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80–937 PDF 2013

REVIEW OF THE FAA’S PROGRESS IN 

IMPLEMENTING THE FAA MODERNIZATION 

AND REFORM ACT 

(113–15) 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

AVIATION 

OF THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

FIRST SESSION 

MAY 16, 2013 

Printed for the use of the 

Committee on Transportation and Infrastructure 

( 

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

committee.action?chamber=house&committee=transportation 

(II) 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE 

BILL SHUSTER, Pennsylvania, Chairman 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee, 

Vice Chair 

JOHN L. MICA, Florida 

FRANK A. LOBIONDO, New Jersey 

GARY G. MILLER, California 

SAM GRAVES, Missouri 

SHELLEY MOORE CAPITO, West Virginia 

CANDICE S. MILLER, Michigan 

DUNCAN HUNTER, California 

ERIC A. ‘‘RICK’’ CRAWFORD, Arkansas 

LOU BARLETTA, Pennsylvania 

BLAKE FARENTHOLD, Texas 

LARRY BUCSHON, Indiana 

BOB GIBBS, Ohio 

PATRICK MEEHAN, Pennsylvania 

RICHARD L. HANNA, New York 

DANIEL WEBSTER, Florida 

STEVE SOUTHERLAND, II, Florida 

JEFF DENHAM, California 

REID J. RIBBLE, Wisconsin 

THOMAS MASSIE, Kentucky 

STEVE DAINES, Montana 

TOM RICE, South Carolina 

MARKWAYNE MULLIN, Oklahoma 

ROGER WILLIAMS, Texas 

TREY RADEL, Florida 

MARK MEADOWS, North Carolina 

SCOTT PERRY, Pennsylvania 

RODNEY DAVIS, Illinois 

VACANCY 

NICK J. RAHALL, II, West Virginia 

PETER A. DEFAZIO, Oregon 

ELEANOR HOLMES NORTON, District of 

Columbia 

JERROLD NADLER, New York 

CORRINE BROWN, Florida 

EDDIE BERNICE JOHNSON, Texas 

ELIJAH E. CUMMINGS, Maryland 

RICK LARSEN, Washington 

MICHAEL E. CAPUANO, Massachusetts 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

GRACE F. NAPOLITANO, California 

DANIEL LIPINSKI, Illinois 

TIMOTHY J. WALZ, Minnesota 

STEVE COHEN, Tennessee 

ALBIO SIRES, New Jersey 

DONNA F. EDWARDS, Maryland 

JOHN GARAMENDI, California 

ANDRE ́ CARSON, Indiana 

JANICE HAHN, California 

RICHARD M. NOLAN, Minnesota 

ANN KIRKPATRICK, Arizona 

DINA TITUS, Nevada 

SEAN PATRICK MALONEY, New York 

ELIZABETH H. ESTY, Connecticut 

LOIS FRANKEL, Florida 

CHERI BUSTOS, Illinois 

SUBCOMMITTEE ON AVIATION

FRANK A. LOBIONDO, New Jersey, Chairman 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee 

SAM GRAVES, Missouri 

BLAKE FARENTHOLD, Texas 

LARRY BUCSHON, Indiana 

PATRICK MEEHAN, Pennsylvania 

DANIEL WEBSTER, Florida 

JEFF DENHAM, California 

REID J. RIBBLE, Wisconsin 

THOMAS MASSIE, Kentucky 

STEVE DAINES, Montana 

ROGER WILLIAMS, Texas 

TREY RADEL, Florida 

MARK MEADOWS, North Carolina 

RODNEY DAVIS, Illinois, Vice Chair 

BILL SHUSTER, Pennsylvania (Ex Officio) 

RICK LARSEN, Washington 

PETER A. DEFAZIO, Oregon 

ELEANOR HOLMES NORTON, District of 

Columbia 

EDDIE BERNICE JOHNSON, Texas 

MICHAEL E. CAPUANO, Massachusetts 

DANIEL LIPINSKI, Illinois 

STEVE COHEN, Tennessee 

ANDRE ́ CARSON, Indiana 

RICHARD M. NOLAN, Minnesota 

DINA TITUS, Nevada 

SEAN PATRICK MALONEY, New York 

CHERI BUSTOS, Illinois 

CORRINE BROWN, Florida 

NICK J. RAHALL, II, West Virginia 

(Ex Officio) 

(III) 

CONTENTS Page 

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

TESTIMONY 

Hon. Michael P. Huerta, Administrator, Federal Aviation Administration ....... 8 

PREPARED STATEMENTS AND ANSWERS TO QUESTIONS FOR THE 

RECORD SUBMITTED BY WITNESSES 

Hon. Michael P. Huerta: 

Prepared statement .......................................................................................... 22 

Answers to questions from the following Representatives: 

Hon. Frank A. LoBiondo, of New Jersey ................................................. 35 

Hon. Sam Graves, of Missouri; responses include ‘‘A White Paper 

on the National Aeronautical Charting Office (NACO) High Performing Organization (HPO),’’ Federal Aviation Administration 

(June 30, 2008) ....................................................................................... 56 

Hon. Rodney Davis, of Illinois .................................................................. 124 

Hon. Rick Larsen, of Washington ............................................................ 126 

Hon. Andre ́ Carson, of Indiana ................................................................ 131 

Hon. Ann Kirkpatrick, of Arizona ............................................................ 138 

SUBMISSIONS FOR THE RECORD 

Hon. Larry Bucshon, a Representative in Congress from the State of Indiana, 

request to submit letter from the Indiana congressional delegation to Hon. 

Ray LaHood, Secretary, U.S. Department of Transportation and Hon. Michael P. Huerta, Administrator, Federal Aviation Administration, which 

urges Mr. LaHood and Mr. Huerta to consider the application of the Ohio/ 

Indiana Unmanned Aircraft Systems Center and Test Complex to serve 

as one of the six Unmanned Aircraft Systems test sites required by the 

FAA Modernization and Reform Act of 2012 ..................................................... 5 

iv 


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SUMMARY OF SUBJECT MATTER 

TO: 

FROM: 

RE: 

Members, Subcommittee on Aviation 

Staff, Subcommittee on Aviation 

Subcommittee Hearing on "Review of FAA's Progress in Implementing the FAA 

Modemization and Reform Act" 

PURPOSE 

The Subcommittee on Aviation will meet on Thursday, May 16,2013, at 2:00 p.m. in 

2167 Raybum House Office Building to receive testimony in order to re-examine the progress 

that the Federal Aviation Administration (FAA) has made in implementing portions of the FAA 

Mode.l1lization and Reform Act of2012 (the Reform Act) (PL. 112-95). The Subcommittee will 

hear from the agency on the progress it has made and the steps it has taken in implementing the 

Reform Act. 

BACKGROUND 

The FAA reauthorization bill, the FAA Modernization and Reform Act of2012 (p.L. 

112-95) was signed into law by the President on February 14,2012. This key piece of legislation 

contained mUltiple provisions to provide for a modern, safe and efficient civil aviation system 

now and into the future. The RefOlm Act provides the funding necessary for the Administration 

to operate the air traffic control system at the highest standards of safety and to modernize the 

Nation's air traffic control system. It provides policy direction for the FAA's critical safety and 

ail' traffic contl'Ol modernization programs and implements reforms that will allow the FAA to 

become a more efficient, results-oriented safety organization. In addition, the RefOlm Act 

contains provisions that will address passenger service improvements. The Reform Act also 

includes mUltiple provisions that assist the FAA's safety oversight role. After five years of short 

term extensions, the Reform Act provides the FAA with the necessary guidance and stability it 

needs. 

Safety 
v 


Insert offset folio 2 here 80937A.002

The United States aviation system is the safest in the world due to the hard work and 

commitment of government, industry and other stakeholders to provide safe air travel. The 

aviation system is a key part of the Nation's infrastructure and economy and it is the top priority 

of the FAA, stakeholders, and Congress to ensure the safety of the aviation system. Several 

important safety issues are addressed in the Reform Act by requiring the FAA to develop rules, 

on air ambulance operations, maintenance providers, foreign repair stations, and commercial . 

aircraft personnel training requirements. The Reform Act requires the FAA to report to Congress 

on topics such as runway safety, flight standards, and foreign repair stations to ensure that 

regulations are being complied with and address any weaknesses in the system. To help foster 

the safety of the national airspace system (NAS) the Reform Act also requires studies on FAA 

staffing needs and models and addresses a variety of training issues. The FAA is behind on 

meeting the deadlines for the many provisions outlined above, but it is continuing to make some 

progress on addressing the requirements. 

Unmanned Aircraft Systems 

The RefOlm Act requires the FAA to allow for the safe integration of civil unmanned 

aircraft systems (UASs) into the NAS by December 2015. Ultimately, it is the FAA's call 

whether civil UASs can be safely integrated by this date. Currently, public UASs, such as those 

operated by Federal, State, and local government entities, including law enforcement agencies, 

are operating in the NAS, but only with FAA authorization. The Reform Act requires the FAA to 

work with government entities to expedite the authorization process while still ensuring safety. 

Govemment entities are seeking to use UASs for such missions as: search and rescue, wildlife 

and weather research, mapping, firefighting, border patrol, and law enforcement efforts. 

Not later than 180 days after enactment, the FAA is directed to establish a program to 

safely integrate UASs into the NAS at six test ranges. Due to privacy concerns, the FAA is 

currently behind on implementation. The FAA issued a Screening Information Request on 

February 14, 2013, for the test ranges and is currently going through the process of selecting the 

test ranges with the hopes it can announce selections by the end of2013. The establislunent of 

test ranges will allow the FAA to collect valuable data on the operation ofUASs and decide how 

and ifUASs can be safely integrated into the NAS. 

The Secretary of Trans pOl tat ion shall determine if certain UASs may operate safely in the 

NAS prior to completion of the comprehensive plan and guidance required by the Reform Act. In 

making the determination, the Secretary will decide the types of UASs, if any, as a result of their 

size, weight, speed, operational capability, do not create a hazard to users of the NAS or the 

public or pose a threat to national security. In addition, the Secretary will decide whether a 

celtificate of waiver, certificate of authorization, or airworthiness certification is required for the 

operation of small UASs. If the Secretary determines that celtain UASs may operate safely in the 

NAS, the Secretary is required to establish requirements for the safe operation of such aircraft 

systems. 

Finally, in regard to the operation of model aircraft, the Reform Act prohibits the FAA 

from promulgating any rule or regulation regarding a model aircraft or an aircraft being 

developed as a model aircraft, as long as the model aircraft is flown for hobby or recreational use 

2 
vi 


Insert offset folio 3 here 80937A.003

and adheres to the other requirements of the law. While the FAA has made steps to achieve the 

UAS requirements in the law, it has run into several problems that have delayed implementation, 

including addressing privacy concerns. 

Passenger Service Improvements 

The Reform Act acknowledges that airline passengers are critical stakeholders in the 

airline industry and contains provisions to address passenger concerns. It includes provisions that 

instruct the Secretary , FAA, U.S. Depaliment of Transportation (DOT) Inspector General (1G), 

and Government Accountability Office (GAO) to conduct studies and reports and take other 

actions to improve passenger service. Such provisions include a requirement DOT require air 

carriers to provide a monthly report on diverted flights. Additionally, to ensure that passengers 

receive proper treatment during delays, DOT is required to ensure that all air calTiers develop 

emergency contingency plans at airports the carriers serve. DOT is also directed to establish an 

advisory committee on consumer protection to advise the Secretary of Transportation when the 

Secretary is can),ing out airline customer service improvements. The IG and GAO are required 

to conduct reviews and study issues that affect aviation passengers, such as flight delays, 

cancellations, and delayed baggage. All of the studies will provide valuable data to assist 

Congress in future decisions. The FAA and DOT have made progress in cal1),ing out the 

passenger service improvement requirements, similarly the GAO and IG are on schedule with the 

majOllty of their studies and reviews. 

Good Governance 

Through the Reform Act, Congress recognizes the importance of ensuring the FAA is an 

efficient, streamlined, and effective government agency. The Reform Act encourages the FAA to 

reform and streamline its offices, regulations and processes and to seek greater cost efficiencies. 

In fact, the Refotm Act requires the FAA to undertake a review of all programs, offices, and 

organizations to identify duplicative positions or programs, wasteful practices, redundant 

functions, and inefficient processes or policies. The FAA is then directed to submit a report to 

Congress. This report was due to be completed earlier this year. The FAA is also given the 

authority to take any actions necessary to address the findings of its review and report. 

Another important reform provision directs the FAA to develop a facilities realignment 

and consolidation repott. The report is to be comprehensive, include labor and indus!!)' 

patiicipation, and outline recommendations to support the transition to Next Generation Air 

Transportation System (NextGen) and to reduce capital costs without adversely affecting safety. 

After a public review process, the report is to be submitted to Congress. The Administrator may 

not carry out the recommendations included in the report if a joint resolution of disapproval is 

enacted by Congress within 30-days after the submission of the repolt to Congress. The FAA is 

still developing the facilities realignment and consolidation repoli and is delayed in meeting the 

timelines outlined in the Refolm Act. 

Another important provision in the Reform Act addresses concerns by industry and other 

stakeholders related to inconsistent interpretations of regulations by FAA staff and Regional 

offices. To address the concems, the RefOlm Act directs the FAA to fOlm an advisory panel to 

3 
vii 


Insert offset folio 4 here 80937A.004

determine the root cause of inconsistent interpretations and to develop recommendations to 

improve consistency among FAA offices. The report was due one year after enactment and is 

currently overdue. 

Finally, the RefolTIl Act requires the FAA to review and reform its aircraft certification 

process by conducting an assessment, developing recommendations to improve efficiency, 

reduce costs, and streamline and reengineer the certification process. A report was due six 

months after enactment and the FAA is directed to begin implementing the recommendations not 

later than one year after enactment. The FAA is still in the process of developing these 

requirements. 

NextGen 

Under our current air traffic system, controller workload, voice communication 

congestion, limitations of air traffic control radar accuracy, and the coverage and accuracy of 

ground-based navigational signals impose limitations on the capacity and efficiency of air traffic, 

particularly in busy terminal areas near major airports and metropolitan areas. According to the 

FAA, by 2025 our air traffic system will need to handle roughly 1 billion passengers per year 

and, including general aviation flights, more than 79,000 flights every day. It is widely 

acknowledged our current system will not be able to meet future demands. 

For nearly a decade, the FAA has been trying to transition from legacy air traffic systems 

to NextGen. These efforts include transitioning from a ground-based radar system to a satellitebased surveillance system, developing data communications capabilities between aircraft and the 

ground to reduce controller and pilot workload, improving aviation weather forecasting and 

monitoring systems, and creating shared and distributed information technology architectures. 

When it is properly implemented, NextGen will reduce delays and operating costs, improve 

safety and efficiency, increase capacity, and lessen aviation's impact on the environment. This 

will ensure that the United States aviation system maintains its global competitiveness as other 

nations modernize their own air traffic control systems. 

However, NextGen suffers fi'om a lack of accountability, significant cost ovellUUS, and 

numerous project delays. To address underlying shortfalls and unforeseen challenges, Congress 

enacted numerous NextGen refOlms in the Reform Act, which include requiring the FAA to 

establish a ChiefNextGen Officer, responsible for overseeing the entire NextGen program and 

held accountable by Congress. In addition, it elevated the position of the Director of the Joint 

Planning and Development Office (JPDO) to Associate Administrator, reporting directly to the 

Administrator and responsible for inter- and intra-agency coordination. It granted the FAA 

authority to streamline the environmental review process required for the development and 

implementation of pel'fOlmance-based navigation procedures. It authorized the establishment of 

an avionics equipage incentive program and required the FAA to identify operational incentives 

for equipage. In addition, it required the FAA to establish and track NAS performance metrics to 

track the agency's progress in implementing NextGen. 

Unfortunately, to date the FAA does not have a ChiefNextGen Officer and has not 

elevated the head of JPDO to Associate Administrator. Further, the agency has not implemented 

4 
viii 


Insert offset folio 5 here 80937A.005

a plan to make use of its new authority to expedite the environmental review process, has not 

established financial or operational equipage incentives, and has not completed its work on 

establishing and tracking NAS performance metrics. 

Conclusion 

It has been over a year since the FAA Modernization and Reform Act of2012 became 

law, which created a vital four year framework for the FAA and industry. It is the Aviation 

Subcommittee's responsibility to ensure that the FAA is properly implementing the provisions 

contained in the Reform Act. In addition, given the important work that the FAA is responsible 

for, it is critical that the Subcommittee ensure the FAA is properly organized and structured. The 

Reform Act set forth dozens of deadlines that the FAA was required to achieve; some of those 

deadlines have been met, while the FAA is still in the process of meeting others. While the FAA 

may not have met all deadlines, some progress has been made in areas that were facing 

stagnation or inefficiencies. The FAA must be attentive in its efforts to implement the mandates 

and goals of the FAA Modernization and Reform Act of2012. 

WITNESS LIST 

The Honorable Michael P. Huerta 

Administrator 

Federal Aviation Administration 

5 
(1) 

REVIEW OF THE FAA’S PROGRESS IN 

IMPLEMENTING THE FAA MODERNIZATION 

AND REFORM ACT 

THURSDAY, MAY 16, 2013 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON AVIATION, 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, 

Washington, DC. 

The subcommittee met, pursuant to call, at 2:54 p.m., in Room 

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

(Chairman of the subcommittee) presiding. 

Mr. LOBIONDO. The committee will come to order. Good afternoon. Apologies. Series of votes. Longer than expected. Yada, yada, 

yada. But we apologize. 

As a followup to our February hearing we are again going to attempt to examine what progress the FAA has made in implementing the Modernization and Reform Act that was signed into 

law on February 14th of 2012. The reform act was passed after 5 

years—5 excruciating years—of short-term extensions, but it created a stable 4-year framework for the FAA, industry, and other 

stakeholders. The act makes important reforms to the aviation system and to the FAA in order to increase efficiency and modernize 

the system, and ensures that we maintain a safe, modern, and efficient civil aviation system for now and into the future. Ensuring 

implementation of the FAA reauthorization is and will remain a 

top priority of the subcommittee. 

NextGen is a central part of the reform law. I am extremely fortunate to represent New Jersey’s Second Congressional District, 

which happens to include the FAA’s premier technical center. So I 

have seen firsthand the work that goes on there and I have been 

able to learn more about why NextGen is important to the FAA, 

the aviation industry, and the traveling public. 

What has become clear is that we must attempt to do more—we 

must do more—to provide certainty for the FAA and the stakeholders, which is why the reform act requires the FAA to appoint 

a chief NextGen officer for a term of 5 years. This is going to help 

with the technology and accelerates deployment of the performance-based navigation procedures for large, medium, and small airports. The reform act also requires the FAA to include FAA employees, such as air traffic controllers, in the modernization process, and requires the FAA, with input from the industry, to identify 

operational incentives to encourage the aviation industry to equip 

with necessary avionics. 

2 

The FAA is making progress with some of these efforts, and I 

want to thank Administrator Huerta for his efforts. But we know 

that we still have a long way to go together. Since the subcommittee’s last hearing, the Aviation Subcommittee has held the first in 

a series of listening sessions broadly focused on implementation of 

NextGen. We were able to hear from industry stakeholders about 

various issues of concern in the implementation of NextGen air 

traffic control procedures. 

Next week we are holding a second NextGen listening session. 

This will give the subcommittee an opportunity to hear from the 

FAA and industry stakeholders in a less formal setting. We, of 

course, intend to use what we learn in the listening sessions to 

help us, industry, and FAA achieve near-term real world benefits, 

measurable benefits from NextGen. 

Today, I look forward to hearing from Administrator Huerta 

what the plan is for the FAA to fully implement the reform act. In 

particular, I am interested in learning how the FAA is complying 

with the various safety modernization, reform, and good governance provisions included into law. 

The FAA has had some successes in implementing the act. However, similar to NextGen, the FAA has also faced some challenges 

and is behind on some of its deadlines. Administrator Huerta will 

testify that the FAA is on track to meet or has met 80 percent of 

the deliverables, including the FAA reauthorization law, and has 

currently completed half of that. 

But I think, Mr. Huerta, even you would agree that not all of the 

reauthorization requirements are created equal. The FAA has yet 

to complete some of the most important and challenging requirements of the law, including the Unmanned Aircraft Systems, UAS, 

integration plan to allow for safe integration of UAS by 2015. The 

small UAS rulemaking, the facility realignment and consolidation 

plan, and reforming and streamlining certification processes. Completion of these requirements are delayed. And I look forward to 

hearing from Administrator Huerta on what we can expect, when 

we can expect to see more progress, and what we may be able to 

do to help be a force multiplier for you. 

Before we turn to Administrator Huerta for a statement, I would 

like to ask unanimous consent that all Members have 5 legislative 

days to revise and extend their remarks and include extraneous 

material for the record of this hearing. 

Without objection, so ordered. 

Mr. LOBIONDO. I now would like to yield to Mr. Larsen for any 

statement you may have. 

Mr. LARSEN. Thanks, Chairman LoBiondo, for calling today’s 

hearing to review the FAA’s progress in implementing the reauthorization law. For the past several weeks, budget sequestration 

and its effect on the FAA have distracted the subcommittee’s oversight on reauthorization. And I just want to make a few brief remarks on that and refocus on the agency’s implementation of FAA 

reauthorization, which contains several important provisions. 

First, last month we took action to end air traffic controller furloughs and airline delays throughout the system. That said, the 

public should understand that this action was only a temporary solution. Sequestration will have lingering effects this fiscal year that 

3 

we need to better understand, and the bill ending the furloughs 

that passed last month does come at a cost. Lost funding for the 

Airport Improvement Program means less investment in our Nation’s airports and less long-term competitiveness for our economy. 

Our country already does not have a top 25 airport, according to 

annual rankings that came out last month, and cutting AIP makes 

that climb tougher. Moreover, if we don’t pass or enact a longer 

term comprehensive and balanced solution to cut the deficit and 

end sequestration, then none of my colleagues should act surprised 

when we are backed into another crisis in the aviation sector this 

October. 

Mr. Chairman, a key feature of the FAA reauthorization law was 

the new policy direction it provided for the FAA’s NextGen initiative and development of new technologies. The subcommittee must 

provide vigorous oversight to ensure these provisions are effectively 

implemented. For example, theFAA reauthorization sought to increase leadership and accountability over NextGen by creating a 

chief NextGen officer position. Congress created this position to 

break through bureaucratic barriers at the FAA and to unify the 

agency’s NextGen efforts, but it has been vacant for over a year. 

So I am pleased that yesterday the administration announced that 

it would appoint a new deputy administrator who will fill the role 

of chief NextGen officer. 

Section 212 of the reauthorization requires the FAA to implement more fuel-efficient, performance-based navigation procedures 

at the Nation’s top 35 airports and to report to Congress on its 

progress. Yet to date the FAA has not produced the implementation plan and the report required by law that is several months 

overdue. 

The FAA is also working with the RTCA NextGen Advisory Committee and industry stakeholders to analyze nontechnical barriers 

to implementing performance-based navigation. I look forward to 

hearing an update from Administrator Huerta regarding the FAA’s 

efforts to implement these procedures. 

Aviation manufacturing and technology development are major 

economic drivers in my home State of Washington. Therefore, I am 

pleased with the FAA reauthorization, that it contained important 

provisions to improve the FAA’s processes for certifying airplanes, 

engines, and other products. To address these issues raised by the 

GAO, section 313 required the FAA to convene an advisory panel 

to address inconsistent interpretations of flight standards and aircraft certification regulations. Unfortunately, that report to Congress on this effort is overdue. 

The FAA reauthorization also requires the agency to develop a 

plan for safely integrating Unmanned Aircraft Systems into the 

National Airspace System by December 2015. The FAA’s Joint 

Planning and Development Office has collaborated with industry 

stakeholders and other Federal agencies to develop and finalize a 

comprehensive UAS implementation plan. Additionally, the FAA 

will select six test sites this year to gather data on how UAS operations may impact air traffic operations. 

I would like Administrator Huerta to identify some of the technical issues that need to be tested and resolved so that unmanned 

systems can safely and routinely operate in civil airspace. These 

4 

are all critical issues for maintaining an American leadership in 

the aviation sector. And I am hopeful that the FAA and this subcommittee will continue to work together to meet the challenges 

that we have ahead of us. 

Thank you. I look forward to hearing from our witness. And I 

yield back. 

Mr. LOBIONDO. Thank you, Mr. Larsen. 

Mr. LOBIONDO. Normally we don’t go to Members for opening 

sessions, but Mr. Bucshon has a special circumstance with needing 

to manage the floor, so he has asked for 1 minute. And with the 

committee’s indulgence, you are recognized. 

Dr. BUCSHON. Thank you for your indulgence, Mr. Chairman. 

Thank you for coming back today, Mr. Huerta. As you know, the 

FAA reauthorization, in that we authorized several test sites for 

Unmanned Aircraft Systems. Indiana and Ohio have jointly applied 

to be a test site. I just want to submit for the record the letter that 

the entire Indiana delegation sent to the DOT regarding our application and put in a plug for our State. It is a great place to do business. We would love to work with the FAA on this issue. 

Thank you, Mr. Chairman. I want to submit this for the record. 

Mr. LOBIONDO. Without objection, so ordered. 

[The information follows:] 

5 


Insert offset folio 6 here 80937A.006

Q[onureSf5 of tbe WUlte/) $tl1tes 

(w;lllfiiJillllton. n(( 20510 

May 06, 2013 

The Honorable Ray LaHood 

Secretary 

United States Depal1ment of Transportation 

1200 New Jersey Avenue, SE 

Washington, DC 20590 

Dear Secretary LaHood and Administrator Huerta: 

The Honorable Michael Huerta 

Administrator 

Federal Aviation Administration 

800 Independence Avenue, SW 

Washington, DC 20591 

We are writing to urge you to givc full consideration to the application ofthc Ohio/Indiana 

Unmanned Aircraft Systems ((JAS) Center & Test Complex. The states of Ohio and Indiana 

have both the military and civil resources necessary to be a leader in the emerging UAS scctor, 

and the Ohio/Indiana Unmanned Aircraft Systems (UAS) Center & Test Complcx is well suited 

to serve as one of the six UAS Tcst Sitcs required by the FAA Modcrnization and Reform Act of 

2012 (Public Law 112-95). 

The Ohiollndiana proposal fulfills the Federal Aviation Administration's (FAA) goal to develop 

regulatory standards to fostcr lJAS technology and operational procedures and also will add to 

the data the FAA requires to permit future UAS operations in the National Airspace System 

(NAS). This joint effort focuses critical resourccs on UAS research, development, testing, 

manufacturing and training to thc benefit of Federal, Stale and commercial uscrs. The 

Ohio/Indiana proposal is uniquely suited to cany out its efforts in close proximity to a diverse 

and powerful team of FAA partners already conducting research and development work for UAS 

integration. including the Air Force Research Laboratory (AFRL), the National Aeronautics and 

Space Administration (NASA) Glenn Research Center, and the Naval Surfacc Warfare Center 

Cranc Division (NSWC Crane). By locating significant UAS research and development in 

proximity to these facilities and their contractor base, thc Ohio/Indiana proposal creates a new 

and efficient airspace model that lcverages the existing ground infrastructure and research, 

development, and tcclmologics needed for the integration of UAS technologies into the NAS. 

These include sense and avoid technologies al AFRL; secure command, control and 

communication technologies at NASA Glenn Research Center; aud intelligence and information 

leclmologies at NSWC Crane. 

The Ohiollndiana proposal also fulfills the FAA's need lor geographic and climactic diversity in 

its testing area. The Ohio and Indiana region represents a broad array of weather conditions, 

allowing for adequate testing of aircraft and equipment in any weather conditions they may 

cxperiencc throughout thc national airspace. The region currently hosts robust UAS operations 

utilizing existing access 10 restricted airspace and existing Memorandums of Agreement (MOA) 

and certificates of waiver or authorization (COA). With more than I,OO() sorties flown in the 

proposed airspace last year alone, the knowledge base of area pilots, researchers and engineers 
6 


Insert offset folio 7 here 80937A.007

already operating in the UAS aeronautical specialties brings extraordinary understanding, 

commitment and a proven track record of performance and safety. In addition, because 

academic involvement is vital to maintaining next generation technology, the Center has 

partnered with 11 universities, comprising most of thc major institutions of higher education, in 

Ohio and Indiana. 

The UAS industry is projected to become a $94 billion industry by 2020, and the industry 

projects job growth in the field will grow al 3.5% to 4.5% a year through 2025. The 

Ohio/Indiana proposal projects that key research and development activities associated with a 

test site will attract additional suppliers and manufacturers, contributing to significant economic 

development and job creation not only in Ohio and Indiana but throughout the Midwest. 

As you know, the FAA Modernization and Reform Act of 20 12 establishes a tight schedule for 

the development ofplllns to integrate UASs into the National Airspace System. The selection of 

the Ohio/Indiana UAS Center & Test Complex would significantly enhance the FAA's ability to 

create the policies needed to meet the diverse national interests associated with these aircraft in a 

safe and timely manner. Thank you for your consideration of our views, and we stand ready to 

assist you or your staff in any way should you have additional questions. 

/) /II LVI (ONY) 

Dan Coats 

United States Senator 

/# 

Marlin Stutzmlln 

Member of Congress 

Sincerely, 

;]i.: {,j~r;" Jackie Wlllorski 

Member of Congress 

Todd Rokita 

Member of Congress 
7 


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M~ Member of Congress 

ec~~'~ Member of Congress 

Luke Messer 

M,mOC'OfC~b~ 

Larry Bue on --

Member 0 Congress 
8 

Dr. BUCSHON. Thank you. I yield back. 

Mr. LOBIONDO. Thank you. 

Mr. LOBIONDO. Mr. Huerta, once again, we apologize for the 

delay. And you are recognized. 

TESTIMONY OF HON. MICHAEL P. HUERTA, ADMINISTRATOR, 

FEDERAL AVIATION ADMINISTRATION 

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

Larsen, and members of the subcommittee, a year ago Congress reauthorized the Federal Aviation Administration after 41⁄2 years of 

uncertainty and stopgap measures. The biggest benefit of reauthorization was that it would provide predictability and allow us to invest with greater certainty in the future. So we are grateful for 

your effort on this and we have been working very diligently in the 

past year to implement the provisions of reauthorization. 

As we move forward, the number one mission of the FAA is safety. This will always be our priority. In the last few years, Congress 

has given us much guidance on how to advance aviation safety and 

we have accomplished a great deal. The FAA overhauled flight and 

duty rules to guarantee that airline pilots have the opportunity to 

get the rest they need to operate safely, and we are raising the required numbers of hours of experience before a pilot can operate 

the controls on any airline flight. 

We are also finalizing a rule that will require more rigorous 

training so that flight crews can better handle rare but serious scenarios. We are also improving our safety culture at the FAA and 

throughout the industry by voluntarily reporting hazards before 

they could become a problem and by adopting safety management 

systems. Internally, we created the Aviation Safety Whistleblower 

Investigation Office. One of the cornerstones of our safety culture 

is to ensure that employees can provide information without fear 

of reprisal. 

While we are enhancing the safety of the system that we know 

today, we are also working to deliver the benefits of new technology 

to create the aviation system of tomorrow through NextGen. We 

are working to safely integrate Unmanned Aircraft Systems into 

our airspace. Earlier this year, as directed by Congress in reauthorization, we requested proposals to host six test sites across the 

country to test Unmanned Aircraft Systems. 

This is a matter of significant public interest. We need to better 

understand operational issues to safely integrate these aircraft into 

our national airspace. We need to explore pilot training and make 

sure that unmanned aircraft sense and avoid other aircraft. And if 

they lose the link to their ground-based pilot, these aircraft need 

to operate safely. 

If we are going to continue to move aviation forward and remain 

a world leader, we need to collaborate across the FAA as well as 

with other Government agencies and also with industry. Reauthorization asked us to do this, and we have made great strides in collaborative efforts. 

Chairman LoBiondo, as you know, Atlantic City is a leader in 

NextGen research. The William J. Hughes Technical Center plays 

a key role in fostering NextGen, and we appreciate your support. 

9 

We have worked with our labor unions, with industry, airports, 

and others, to address the problem of congested airspace over busy 

metropolitan areas. We are producing satellite-based procedures 

much more quickly and we are using these NextGen procedures 

right now to reduce the miles that aircraft must fly to create more 

direct routes, to cut delays, and to reduce fuel burn and cut greenhouse gas emissions. 

I am pleased that the President has announced his intent to appoint Michael Whitaker as Deputy Administrator of the FAA. Mr. 

Whitaker is a veteran of the airline industry and will serve as the 

FAA’s chief NextGen officer, responsible for fostering the transformation of our national airspace. 

The FAA has an initial set of NextGen metrics available on our 

Web site, and we expect to publish additional performance metrics 

in the coming months. Our NextGen performance snapshots show 

that NextGen is happening now. For example, in Chicago we have 

been able to reduce delays at O’Hare International Airport in bad 

weather, thanks to NextGen. O’Hare and nearby Midway Airport 

have overlapping airspace at times. We made better use of this congested airspace in the last 2 years with a satellite-based procedure 

that aircraft use when flying into Midway. This procedure has allowed O’Hare to improve its arrival rate by 8 to 12 aircraft per 

hour when it is rainy or foggy and the ceilings are low. And aircraft 

flying into Midway travel fewer miles and save fuel. This is one of 

the many positive effects of NextGen and the type of improvement 

that reauthorization supports. 

The reauthorization laid out a vision to address the future needs 

of our Nation’s aviation system, and these needs have not gone 

away. It is important for us to work together to protect the great 

contribution that civil aviation makes to our economy of $12.3 trillion and 10 million jobs. 

As you know, we are again facing fiscal uncertainty and unpredictability. The sequester is requiring the FAA to make sizable 

budget cuts that affect our operations and our future. While we are 

very grateful that Congress found a temporary solution to the FAA 

furloughs, this measure does not end the sequester. We will not 

enjoy the benefits or the stability that reauthorization provides 

until we find a solution to the sequester and find a sensible longterm solution. I sincerely hope that we can work together to ensure 

that America continues to operate the safest and most efficient 

aviation system in the world. 

Mr. Chairman, this concludes my prepared remarks. I would be 

pleased to answer any questions you may have. 

Mr. LOBIONDO. Thank you, Mr. Huerta. I am sure we will have. 

Mr. LOBIONDO. In starting off, as you had indicated in your 

opening statements and statements that have been made in the 

past, the FAA Technical Center that I represent is the test and integration facility for NextGen. I understand now the Florida test 

bed also reports through the Technical Center, and I am wondering 

if it is appropriate to assume that the soon-to-be-named six UAS 

test sites will also report to the Technical Center. 

Mr. HUERTA. We haven’t made a determination of the reporting 

because the test sites would actually be privately operated. What 

we are providing as part of the unmanned aircraft test site desVerDate Aug 31 2005 11:39 Sep 27, 2013 Jkt 000000 PO 00000 Frm 00017 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\5-16-1~1\80937.TXT JEAN
10 

ignation is a designation for them to operate and to perform research and analysis so that we can understand how these integrate 

into the national airspace. 

Currently, the process of selection of the test sites is administered through a joint program office that is jointly administered by 

our Aviation Safety Organization and our Air Traffic Organization. 

As we get later in the year we will make some further determinations and decisions regarding the selection of the test sites. We will 

make some decisions as to how best to integrate them into our organization. 

Mr. LOBIONDO. So then the final testing and integration collaboration from the six test sites for UAS into the national airspace remains to be seen whether that will be done at the FAA’s Technical 

Center? 

Mr. HUERTA. I think what we have to see is what the proposals 

put forward and then how we best leverage that data across the 

whole FAA. 

Mr. LOBIONDO. I, obviously, have a keen interest in this. 

Moving on to another topic, the FAA is currently behind on providing Congress with a National Facilities Consolidation and Realignment Report. Can you give us a status of the report and can 

you tell us will it be comprehensive and include all of the FAA’s 

facility consolidation and realignment projects? 

Mr. HUERTA. Yes. As you know, the consolidation of facilities has 

been something that has been a high priority for the agency. Reauthorization provided us important tools to address how we look at 

consolidation of facilities. One of the things that has bedeviled us 

in the past as we have looked at this has been that the agency 

used inconsistent technical approaches in evaluating whether or 

not and how best to achieve benefits associated with consolidation. 

We have been working collaboratively with our stakeholders and 

partners to work through a process of how we would look across 

the full scope of facilities that exist across the country. And while 

it has taken longer certainly than was anticipated by the committee and certainly longer than I would like to see, I think that 

the benefits of this collaboration have been quite fruitful. 

We are expecting to finalize an approach that we would like to 

share with the committee at a point in the future and talk about 

what the way forward would look like. But we are looking at the 

full scope of FAA facilities. 

Mr. LOBIONDO. Any idea at what point in the future? 

Mr. HUERTA. In the coming couple of months. 

Mr. LOBIONDO. Couple of months. 

Last question for now. You may be aware that several Members 

have recently introduced a bill called the Small Airplane Revitalization Act of 2013. The legislation is intended to remove some outdated regulatory barriers to streamline certification processes and 

improve the well-being of general aviation industry, all while keeping a keen eye to improving safety. Have you at all been familiar 

with this legislation or have you seen it or had a chance to look 

after it? 

Mr. HUERTA. I have seen the legislation. And as you know, Mr. 

Chairman, we have been working on safety improvements for small 

airplanes regulated under part 23 for quite some time now. We 

11 

have had an Aviation Rulemaking Committee composed of industry 

experts that have been working since August of 2011 to review our 

regulations and processes and to provide actionable recommendations to the FAA. 

We are expecting that we would soon be receiving the ARC’s recommendations and we will able to evaluate them for implementation planning and assigning resources and establishing timelines. 

I am not able to comment on the pending legislation, but should 

this legislation become law, the FAA will, of course, implement its 

provisions, as we do with any other mandate. 

Mr. LOBIONDO. We would be interested if you and your team 

have an opportunity to take a look at this and if you have any suggestions you can offer us about how we can dovetail in so that we 

are sort of working together on this and not have the committee 

working on something, that you can see some improvements that 

can be suggested with. 

Mr. HUERTA. We can certainly do that. On a high level, the approach that, as I understand the legislation, does acknowledge the 

work that has been ongoing. And I think that there is a great deal 

of convergence there. But we can take a look at it. 

Mr. LOBIONDO. OK. We would appreciate that. Thank you. 

Mr. Larsen. 

Mr. LARSEN. Thank you, Mr. Chairman. 

Administrator, earlier this year Chairman LoBiondo and I met 

with families of Colgan flight 3407. In February as well I asked 

you about the FAA’s progress finalizing a rule on pilot qualifications due this August and another pilot training rule due in October. How would you assess the progress on both of those rules at 

this time? 

Mr. HUERTA. We are making good progress. We are still expecting that we would publish the first rule in August and the second 

in October, as I testified in February. 

Mr. LARSEN. Yeah. All right. Thanks. 

Chairman LoBiondo mentioned next week that we will be having 

a listening session. Our first one had focused on NextGen, and 

some stakeholders stressed the need for the agency to move more 

rapidly to deploy PBN routes into airports. Section 213 of the authorization requires FAA to report to Congress on its plan to implement PBN at the top 35 airports, but to date, we have not received 

that report. Can you update the subcommittee on your efforts to 

implement PBN at the top 35 airports. 

Mr. HUERTA. Well, PBN has certainly been a high priority for the 

agency. It is the centerpiece of our initiative that we call 

Metroplex. And that is a collaborative process that we are implementing across the country that is very much focused on what we 

can do to advance and ensure the use of advanced navigation procedures throughout the National Airspace System. 

The report that you mention is a report that we are finalizing 

our work in now. It is now in executive coordination. I hope to be 

able to provide it to the committee soon. 

Mr. LARSEN. Thank you. With regards to the collaboration, are 

there certain factors that are helping that collaboration and other 

factors that are inhibiting that collaboration? 

12 

Mr. HUERTA. Well, the major thing that characterizes the 

Metroplex initiative and problems that we have had in the past, I 

think it is fair to say that in advancingperformance-based navigation years ago the focus was on quantity rather than quality. And 

by that, I mean that there was a lot of discussion about how do 

we develop and publish advanced navigation procedures and we 

weren’t really focusing on how they were being used or what the 

operational challenges were with actually enabling air carriers and 

other users of the system to take advantage of them. 

What has changed is we are now very focused on these second 

two pieces, how do we ensure that they are actually being used so 

that we can get the benefit and how do we ensure that we are taking all the steps that are necessary to ensure that they can be 

operationalized. That includes an understanding by all of the users 

of the systems—pilots, controllers, airports—if there is military airspace, how does it fit into the Defense Department’s particular requirements, what is the mix of traffic that might exist in a particular metropolitan area. All of that is crucial to being able to develop a procedure that is going to work for the users in the metropolitan area as a whole. 

There are also issues that we identified. We have had an effort 

where we have looked at the operational barriers. That has focused 

us on things such as the air traffic controllers handbook. We had 

an activity underway over the last year which really focused on 

what are specific things that we need to do to update and amend 

the air traffic controllers handbook. Fifteen specific changes were 

recommended as a part of that. We are expecting that we are going 

to complete work on about 10 of them by the end of this fiscal year. 

The others are more complex and will require longer term work to 

get them implemented. But the focus is on what can we do to ensure that these procedures are actually operational. 

Mr. LARSEN. Thanks. The bill created severalmilestones for the 

safe integration of Unmanned Aircraft Systems in the civil airspace, and your written testimony notes that you requested to host 

six test sites around the country. In addition to some of the privacy 

issues that I tend to hear more about from folks when it comes to 

unmanned aerial vehicles and systems, what technical issues, so 

the top three or four technical issues, need to be resolved before we 

can see some safe integration into the NAS? 

Mr. HUERTA. Well, the things that we are looking at relate to the 

types of things that I talked about in my opening statement. How 

does an aircraft operate, for example, when it loses link with its 

ground-based station and what are the rules under which that aircraft would operate until link could be reestablished? That is a different way of looking at the traditional aviation practice of sense 

and avoid. But since the pilot is in the remote location, if link is 

lost between the ground station and the aircraft that is flying 

above, then you have to have a clear set of procedures in place of 

what happens so that that aircraft can avoid other aircraft. 

We also need to understand how these characteristics actually 

operate in different types of airspace, different weather conditions, 

and with particular purposes in mind. For example, a lot has been 

suggested as the potential for the use of unmanned aircraft for 

such things as aerial surveys, environmental monitoring. And those 

13 

raise questions about how do we ensure that those activities can 

be conducted safety in conjunction with other aircraft operating 

within the National Airspace System. 

Weather characteristics and how they operate in inclement 

weather is also a factor that we need to understand. And so while 

there is always bad weather everywhere around the country, we 

also have to understand, are there particular issues that come up 

in different climate conditions? The legislation anticipates that and 

suggests that we look at geographic diversity in the award of the 

six test sites. 

So those are some of the factors that we are focused on: the technical factors of how these aircraft operate, the human factors of 

how the operators actually would interact with other operators 

within the system, and then some of the questions relating to the 

use of these. 

Mr. LARSEN. Great. Thanks. 

Mr. Chairman, I will have a second round, but I will yield back 

for other Members. Thank you. 

Mr. LOBIONDO. Mr. Meadows. 

Mr. MEADOWS. Thank you, Mr. Chairman. 

And thank you for coming to testify. I want to pick up a little 

bit on what the chairman had touched on briefly with regards to 

the Small Aircraft Revitalization Act. I know you don’t want to 

comment on that. But I think earlier this week you convened a 

general aviation safety summit there, where you talked about it. 

And part of that would be really a rewrite of part 23. So that is 

your opinion, that we need to rewrite that. Is that correct? 

Mr. HUERTA. Well, that is what we have been working on, what 

can we do to improve part 23 to achieve the objectives that the industry wants to see in terms of streamlining and faster response 

time. 

Mr. MEADOWS. If you were to highlight three areas that you say, 

Congressman Meadows, these three areas, if we could have legislative assistance on those three, what would those three areas be? 

Mr. HUERTA. I am not sure that we are at a point, since we are 

still working through the process with industry to identify what the 

priorities are, and we expect to receive that report from them later 

on this summer, but the thing that I hear consistently is that 

things just take too long, that the industry is very interested in 

what can be done to streamline the process of achieving a certification for new products coming to market. There are two dimensions to that. One is that it greatly reduces the amount of time for 

a manufacturer to get products into the marketplace, but there is 

also a cost-benefit associated with that, that it reduces the cost of 

these. 

And one of the things that we have heard loud and clear from 

the general aviation industry is that, while they see huge potential 

for improvements in safety as a result of adopting these technologies, they can be expensive. So what can we do through this 

process that would help bring the cost down? 

Mr. MEADOWS. So what would you say is the greatest barrier to 

that? Is that the National Safety Transportation Board? I mean, is 

the enemy us or is it just technology in general? 

14 

Mr. HUERTA. That is exactly what we are looking at right now, 

to try to develop a better understanding of what are those barriers, 

where can we reduce time. I think the big thing is time, that the 

requirement for certification is there for a good reason. You want 

to ensure that if you are installing equipment in aircraft, that it 

will promote safety and not have unintended consequences. Everyone is very interested in doing everything that we can to promote 

safety, but at the same time we have to make sure that we are not 

doing things that are duplicative, redundant, and take more time 

than they need to. 

Mr. MEADOWS. All right. And any specific recommendations that 

you have, I am sure the committee would love to hear those from 

you. And so if you could submit those along with your record. 

But let me pick up on one other thing. You talked about rewriting the controllers handbook. 

Mr. HUERTA. Sure. 

Mr. MEADOWS. And we had a roundtable that the chairman kind 

of convened and I sensed a level of frustration—and that may be 

a harsh word—but a level of concern on the part of some of the airlines where they have installed NextGen equipment and yet they 

are saying the real barrier is FAA controllers that are operating 

under an old set of rules, and even though we might be able to 

adopt the new rules in some of the lower trafficked airspaces, the 

higher traffic that controls so much of the hub and spoke kind of 

arrangement. What are we doing to change that, and is there a 

date certain on when that might be changed? 

Mr. HUERTA. Well, that is exactly the concern that I have heard, 

and that is why we have decided that where we need to focus is 

in metropolitan areas, and that is what Metroplex is really all 

about. We need to look at an entire metropolitan area, bring all the 

stakeholders together, and understand what it is that is really 

going on within that particular metropolitan area and what can we 

do to ensure that, first of all, we know what the priorities are. 

What are the ones that the industry would like to see most? 

The second point is, how do we ensure that they will actually get 

used once they are published? That raises the operational things 

like the controllers handbook and the operational details associated 

with that. 

The final point is we have to track what their utilization is, because you are putting them in place for a particular reason: You 

want to yield benefit. We are all in a much better place if we actually have solid data on their actual utilization. There is a lot of 

folklore that is out there of whether or not they are being used, and 

it is important that we actually have real data to do that. That is 

what we are trying to do through this initiative and why we focus 

it on metro areas. 

Mr. MEADOWS. So bringing those stakeholders together, do have 

you any kind of a timeframe, date certain when that is going to 

happen in terms of getting everybody together? 

Mr. HUERTA. Well, it is rolling timetables that we are working 

through specific metropolitan areas. Like, for example, we had convened two to start, one in north Texas and one here in Washington. 

And we are actually taking advantage of procedures in both of 

15 

those metropolitan areas that have been developed. Later, we started development in other metropolitan areas. 

And so what we are trying to do is separate out the development 

of new procedures into two buckets: What are things that we could 

do right now, what are others that are going to require more analytic and perhaps environmental work in order for us to get 

through the process. We have initiatives in a wide variety of metropolitan areas and they are all operating under difference schedules. 

Mr. MEADOWS. I appreciate the Chair’s indulgence, and I yield 

back. 

Mr. LOBIONDO. Thank you. 

Mr. DeFazio. 

Mr. DEFAZIO. Thank you, Mr. Chairman. 

Mr. Administrator, good to see you. 

In the testimony, you talked about the consolidation, realignment 

of your facilities and said that you are engaging your employees. 

Now, as you know, there has been some controversy in this area 

before about whether or not it was real and meaningful involvement. Can you just give us a little bit of an idea what is going on 

and how engaged the line staff are in this? 

Mr. HUERTA. Well, you know, I would ask them to answer that 

question as well. But I will say this. Yesterday I participated in a 

meeting of well over an hour where there were representatives of 

all of our employee organizations that would be affected by this 

and where they were making a consolidated presentation to me of 

where they are in the process. 

I think the thing that I was most impressed by was that as you 

worked your way around the table, if you didn’t know the people, 

you wouldn’t know who was representing the controllers or the specialists or the technicians or the facility management because they 

were all providing in a very collaborative way meaningful information of how do we get through this. And they were listening to one 

another, they were respecting one another’s positions, and they 

were coming to me with what looked like a lot of thought. It was 

very clear that these people had been working together very closely 

for a long time. 

I thought that was a good sign. I had a bunch of questions. They 

had a lot of good answers. There are some things that they are continuing to work on as we are trying to move this forward. But certainly from my standpoint it looks like the collaboration is working 

quite well. 

Mr. DEFAZIO. Right. Over a number of years the committee has 

expressed concern about overseas foreign repair stations. And there 

was a reauthorization that mandated the implementation of a safety and assessment system. I know sometimes you have problems 

dealing with the State Department and other issues on this. Where 

are we at in terms of the oversight of foreign repair stations? 

Mr. HUERTA. Well, as it relates to the specific State Department 

issue, the issue here related to drug testing and the reauthorization of the requirement that we require that at facilities both inside 

and outside of the United States, which raises territorial issues. 

And so the Secretary of State and the Secretary of Transportation 

wrote a joint letter last fall to the International Civil Aviation Organization membership asking for their willingness to support such 

16 

an approach, and we are continuing to engage ICAO to work 

through developing an international agreement on how we move 

forward. 

Mr. DEFAZIO. OK. So not so much progress. 

Mr. HUERTA. When we are dealing with international oversight, 

as you know, you have to have the consent of the host countries. 

Those are the things that we need to work through. 

Mr. DEFAZIO. Well, yeah, we do, except that we can also prohibit 

our people from using facilities that we haven’t been able to certify 

meet our standards. 

Mr. HUERTA. Well, I think that we have an approach that has 

served us very well in terms of in other parts of the world relying 

on the certification authorities there, just as they rely on us for certification of facilities that take place in this country. That is a process that has served the aviation industry quite well. But we do recognize that we need to continue to push the envelope on oversight, 

and we are doing that. 

Mr. DEFAZIO. Yeah, I mean, I am pretty confident in our oversight, although we have had hearings on that issue also in terms 

of how often you can get to each of these facilities, whether you are 

doing real inspections or whether you are inspecting paperwork 

that certifies inspections, et cetera. So, anyway, it is an ongoing 

concern with me and perhaps other members of the committee. 

And then finally a question about your certification process. We 

obviously have become somewhat more reliant upon the manufacturers themselves to self-certify and test things, and we had a recent concern regarding the new Boeing plane. So are you revisiting 

that in any way? 

Mr. HUERTA. Yes. As part of the Boeing effort we undertook two 

things. One was a detailed review of the specific systems related 

to the battery. As you know, on April 19th we did recertify the battery system and the aircraft are now being modified and gradually 

returned to flight. 

Earlier, we had announced a review of the certification process 

related to the 787, and that review is ongoing. And it is one that 

we think is extremely important because what we want to understand is the whole process, are there issues that we need to take 

another look at and rethink. 

I will say this, though. Certification has always been all about 

bringing the best technical minds together to surface issues, to 

identify what do we need to do to ensure the highest levels of safety. But it is ultimately the FAA that has to issue the certification, 

and that is something that we take very seriously. 

Mr. DEFAZIO. OK. Well, and I appreciate the fact you are reviewing the process, and we don’t need to add unnecessary layers of review and bureaucracy, but we want an effective and safe process. 

So thank you. 

Thank you, Mr. Chairman. 

Mr. LOBIONDO. Thank you. 

Mr. Williams. 

Mr. WILLIAMS. Thank you, Mr. Chairman. 

Mr. Administrator, thank you for being here. Appreciate your 

testimony. 

Mr. HUERTA. Thank you. 

17 

Mr. WILLIAMS. I fly into DFW every Sunday. I am rooting for 

you. OK? But I am a business guy. I come from the business sector. 

Still have a business. And I hear your testimony, and streamlining 

and reforming are two key words in the FAA. And I guess what 

I would like to say—and you have touched on this a little but, just 

as a reminder, ask this question—are you prepared, as the private 

sector is prepared always, to deal with cutting these expenses, 

wasteful spending, so we are not in a crisis management mode like 

we have seen here in the past, that we get on a level of spending 

that we can still give the service but also not have a crisis situation 

every day. 

Mr. HUERTA. Absolutely, sir. We have done an awful lot of work 

to try to reduce the cost of operating the agency. The agency has 

been able to make due with flat budgets for a number of years now, 

at the same time, we are trying to make significant investments in 

new technology while reducing the cost of operating the National 

Airspace System that we have today. 

There has been a lot of focus on areas such as acquisition and 

technology. We have seen a lot of cost savings. We will continue to 

see cost savings in that area. We are also, as we talked about in 

the last few minutes, reducing the costs associated with providing 

the regulatory oversight that we provide through the streamlining 

of processes that enable us to bring new products to market more 

quickly. We have had a lot of focus on what we can do to improve 

our acquisition processes to take advantage of the fact that we are 

a large purchaser. And, yes, this is something that I take very seriously. 

Mr. WILLIAMS. When you go to cutting costs, don’t forget the customer. 

Mr. HUERTA. OK. 

Mr. WILLIAMS. Thank you for your testimony. 

Mr. HUERTA. Thank you, sir. 

Mr. WILLIAMS. I yield back. 

Mr. LOBIONDO. Mr. Nolan. 

Mr. NOLAN. Thank you, Mr. Chairman. 

And, Mr. Huerta, I apologize for coming in late, and thank you 

for your patience. I am sure they told you we had a bunch of votes 

that came up. Our schedule got somewhat conflicted. But congratulations for the work that you have done to implement the major 

new Federal legislation and reauthorization. I certainly believe 

that you are to be commended for the splendid job that you have 

done. 

Mr. HUERTA. Thank you. 

Mr. NOLAN. We are proud of you. 

Together with Congressman Pompeo and several other members 

of this committee, I am one of the sponsors of H.R. 1848, the Small 

Aircraft Revitalization Act of 2013. And as you know—and I saw 

mention of it in your testimony, and I appreciate that—this bill 

will require that the FAA complete a rewrite of the Federal regs 

governing small craft by no later than 2015. If that bill were enacted today with your existing funding and authority do you anticipate you would have a problem with this deadline or do you feel 

that it is doable? 

18 

Mr. HUERTA. Well, I may have mentioned this before you came 

in, sir. This is something that we have been focused on, working 

collaboratively with industry under an Aviation Rulemaking Committee since August of 2011. I think at a high level this is very consistent with the approach that we have been taking. We are expecting this rulemaking committee to provide their report to the agency 

later on this summer and at that point we will see what the specific recommendations are that they are looking at and we will be 

in a much better place to assess the timetables associated with it 

at that point. 

Mr. NOLAN. Very good. That is very helpful. Thank you. 

I didn’t see any mention of the Essential Air Service program, 

which serves several airports in my district and throughout the 

country. And it has been very, very valuable, very helpful to our 

regional economic development and the strong regional centers. Do 

you anticipate that sequester will have an impact on this critically 

important program? 

Mr. HUERTA. Well, while the Essential Air Service program is 

carried in the FAA budget, it is actually administered by the Department of Transportation under the Assistant Secretary for Aviation and International Affairs. And so I am not familiar with what 

their plans are for this year, but we can certainly get you a response for the record. 

Mr. NOLAN. OK. That would be very helpful. 

And, lastly, I know you are looking at half a dozen different sites 

to be considered for the Unmanned Aircraft Systems test sites 

around the country? 

Mr. HUERTA. That is correct. 

Mr. NOLAN. And how many sites are you looking at? Where are 

you at in that process? 

Mr. HUERTA. Well, we are in a competitive process where the 

final submissions were presented to the agency in the last couple 

of weeks. We received 25 distinct submissions from about half of 

the States, and what the legislation provides is for us to designate 

six. And we are in the evaluation process now. We expect to complete that process by the end of this calendar year. 

Mr. NOLAN. OK. Thank you very much, Mr. Huerta. And, again, 

thank you for your work. 

Mr. Chairman, I yield the balance of my time. 

Mr. HUERTA. Thank you. 

Mr. LOBIONDO. Mr. Davis. 

Mr. DAVIS. Thank you, Mr. Chairman. 

Thank you, Administrator Huerta. First off, I want to say thank 

you. And also to Secretary LaHood, my friend from Illinois, please 

offer my thanks to him for administering our recent legislation 

very quickly, especially to save some air towers in my district, and 

also to address the furlough issue. 

I am happy with that response. And as a new Member of Congress, it shows me that you did well when the time came for us 

to pass that legislation, and I have to commend you. 

I came in a little late. I got off the floor, I guess, a little later 

than some of the other Members here. So if I am redundant with 

my first question, I apologize, but it is in regards to the required 

19 

navigation performance procedures. What is the FAA’s plan to 

push for beneficial required navigation performance procedures? 

Mr. HUERTA. Yes, this is an initiative that is a very high priority 

for us because it is something that a lot of air carriers are already 

equipped to be able to take advantage of. This is really the centerpiece of our effort that we call Metroplex, which is focused on major 

metropolitan areas where we bring together the users of the system 

and the operators of the system in a collaborative process with the 

intent of identifying what are priorities for development of navigation procedures, how can we get them implemented as quickly as 

possible, and then once implemented, how do we ensure that they 

are actually being used. 

It raises a host of operational issues and challenges that we need 

to work through as a group. It also raises significant things that 

we need to do on our end as well as the operator needing to do on 

their end. 

I think before you came in we were having some conversations 

about the controller hand book as illustrative of some of the things 

that we needed to work through. But it is as a result of bringing 

the stakeholders together that we identify, hey, we have got a problem with the controller handbook and we need to actually make 

some revisions to it. And so I think it is a process that has served 

us very well. 

It started with a program that we had in north Texas, as well 

as here in Washington. We have since expanded it to include most 

major metropolitan areas of the country. And that work is a very 

high priority for the agency. 

Mr. DAVIS. Great. And third parties are being used to expedite 

the delivery of these benefits? 

Mr. HUERTA. Yes. Reauthorization did request that we consider 

the use of—it provided direction to us to allow for third-party development of these advanced navigation procedures. We did make 

a contract award under that, and that work is ongoing, and we actually think it is progressing quite well. 

Mr. DAVIS. OK. Thank you for ending with you think it is progressing quite well, because that was my next question, what do 

you think this experience is. But I will yield back the balance of 

my time, but I do want to say thank you again. 

And thank you, Mr. Chairman. 

Mr. HUERTA. Thank you. 

Mr. LOBIONDO. Mr. Larsen. Oh, I am sorry, Dan. I didn’t see you 

there. 

Mr. WEBSTER. I have no questions, Mr. Chairman. 

Mr. LOBIONDO. No questions? OK. Apologies. 

Mr. LARSEN. Administrator, the GAO previously reported on the 

need for greater consistency in the FAA’s interpretation of standards for certification and approval decisions. And so in section 313 

the bill required the FAA to establish an advisory panel to develop 

recommendations to address some of those issues raised by the 

GAO. What is the status of that particular advisory committee’s 

work and when can Congress expect to see that report? 

Mr. HUERTA. Now, the section 313 report is something that has 

certainly been, I think, of great importance. This is one of the 

things that I hear a lot about and it is one of the things that we 

20 

need to figure out how we can do a better job of ensuring that we 

have consistency across the NAS. 

The report that we have developed, we do have a draft of the report. It is circulating within the Administration in executive review. And we are working through some comments on that and we 

will have to complete that coordination process before we can 

present it to Congress. But we have a good draft that we are working with. 

Mr. LARSEN. Do you have a timeline on that? 

Mr. HUERTA. I would like to say that I do. 

Mr. LARSEN. I would love for you to say that you do. 

Mr. HUERTA. Unfortunately, I can’t really predict how long it is 

going to take to get all the comments and then to be able to respond to all of them. 

Mr. LARSEN. Well, I think as you are communicating with the 

folks in the Administration and the executive review, letting them 

know that the committee is extremely interested as well in this report and the sooner that we can hear back, the better. 

Mr. HUERTA. We will certainly do that. 

Mr. LARSEN. Not to prolong the discussions on sequestration, but 

I am wondering if you have all done any sort of analysis yet of the 

impact of moving that $253 million out of AIP and what that will 

mean practically. I mean, theoretically we knew what that would 

mean. Do we know yet practically what that will mean in terms of 

a second round of AIP grants for this fiscal year? 

Mr. HUERTA. Yeah. For this fiscal year the $253 million will 

come out of discretionary grants that we would award at the end 

of the year. At this point we don’t have a good sense of what that 

actually means in terms of specific projects because those projects 

tend to come in very late in the year. 

Having said that, I think it is reasonable to expect that you 

would see some delays or that there might be some requests that 

would come in for AIP funding at the end of the year that we 

would not be able to meet as a result of this transfer. 

Mr. LARSEN. Yeah, but it is still a little early—— 

Mr. HUERTA. It is still a little early, yeah. Everyone is still receiving their formula allocation, and so the entitlement funds they 

receive. It is really the final round of discretionary that would be 

affected. 

Mr. LARSEN. OK. Just a moment. 

Yeah. In your written testimony you noted that you are working 

on the ICAO to find some solutions to address aviation greenhouse 

gas emissions and you are encouraged by the EU decision to stop 

the clock on the application of the ETS. Can you update the committee on the progress that FAA is making at ICAO on this issue? 

Mr. HUERTA. Well, as you know, it is a complicated international 

negotiation, but the United States is a very active participant in 

those discussions. The expectation is that this will be one of the 

central discussions that will take place at the ICAO General Assembly, which is scheduled for later on this fall. There is a great 

deal of focus on the part of all of the members of ICAO to present 

actionable recommendations for consideration by the General Assembly this fall. 

21 

Like any large body or semi-legislative body such as ICAO, 

agreements tend to emerge very late in the process. What we are 

seeing right now is a lot of discussion back and forth, a lot of the 

concerns that have been raised by developing countries versus developed countries. But I think that what does unify everyone is a 

sense that the only thing that is going to work is a global solution 

rather than the regional solution that had been proposed originally 

by the Europeans. So we are making progress. It is a very slow 

process. But something will need to be resolved in time for the general assembly this fall. 

Mr. LARSEN. Thank you. 

Thank you, Mr. Chairman. 

Mr. LOBIONDO. OK. That is it. Mr. Huerta, we thank you very 

much. I am sure we will be following up. 

And the committee stands adjourned. 

Mr. HUERTA. Thank you, sir. 

[Whereupon, at 3:37 p.m., the subcommittee was adjourned.] 

22 


Insert offset folio 9 here 80937A.009

STATEMENT OF MICHAEL P. HUERTA, ADMINISTRATOR, FEDERAL 

AVIATION ADMINISTRATION, BEFORE THE COMMIITTEE ON 

TRANSPORTATION AND INFRASTRUCTURE, SUBCOMMITTEE ON AVIATION 

ON A LOOKBACK ON REAUTHORIZATION - ONE YEAR LATER, MAY 16,2013. 

Chainnan LoBiondo, Congressman Larsen, Members of the Subcommittee: 

Thank you for the opportunity to speak to you today. When we last met to discuss the 

subject ofthis hearing in February, the focus of our conversation was, understandably, 

not on the subject of the hearing, but rather on the anticipated effects sequestration would 

have on Federal Aviation Administration (FAA) employees and services. Since that 

time, Congress passed a law that provides FAA with the flexibility to transfer funds of up 

to $253 million in fiscal year 2013. The newly enacted transfer authority provides FAA 

the ability to end the furlough of our employees across the country and restore normal 

operations in the National Airspace System (NAS). Nonetheless, we remain obligated to 

cut $637 million from FAA's budget by the end of the fiscal year. As a result, other, 

significant spending restrictions remain in place, such as a hiring freeze, limitations on 

travel and training, and cancelling or modifying certain contracts. These restrictions will, 

undoubtedly, have long term impacts on the agency and airports which we must continue 

to try to mitigate. The immediate effects on air traffic that were felt across the country as 

a result of the furloughs are now over. Since some of the funding used to end the 

furloughs came from planned airport construction projects, we must make sure that these 

critical projects can still proceed. We are working with airports now to determine which 

projects can be funded this year and which may be delayed. 

1 
23 


Insert offset folio 10 here 80937A.010

There are a number of important ongoing aviation safety-related initiatives that I know 

are of interest to this Committee. Weare working hard to meet the future demands of 

aviation. From transitioning to NextGen to integrating Unmanned Aircraft Systems 

(UAS) into the national airspace system (NAS), the goals we are striving to meet are 

challenging, especially in light of the existing fiscal constraints. But our workforce is 

dedicated and very aware that these goals are vital to FAA's ability to continue leading 

the world in aviation safety and innovation. 

The Federal Aviation Reauthorization Modernization and Reform Act of2012 

(Reauthorization) was enacted into law on February 14,2012. As the returning Members 

of this Subcommittee may recall, passage of the bill was a long odyssey that involved 23 

extensions before a comprehensive bill was passed. During that period, I spoke with 

members individually about the impact the short-term extensions were having on our 

programs. The Airport Improvement Program (AIP) was adversely impacted without the 

stability of a long-term authorization. Airports across the country postponed important 

capital projects due to the concern that funding was being authorized in very small 

amounts due to the short length of the extensions. As a consequence, there was 

uncertainty about committing to projects of all sizes, ranging from safety improvements 

to crucial infrastructure preservation to environmental impact mitigation, such as sound 

insulation. During extension periods, those impacts affected the ability of engineers, 

construction contractors, material and equipment suppliers to place orders and conduct 

work. Only small amounts of funding were made available in accordance with the shortterm extensions, so committing to long-term investments was problematic. We very 

2 
24 


Insert offset folio 11 here 80937A.011

much appreciated the passage of a comprehensive authorization that promised important 

stability and predictability. 

Reauthorization required over 200 separate deliverables, nearly half of which were due 

within the fIrst year of enactment. FAA is on track to meet or has met approximately 

80% of those action items required to date in the law. We have currently completed 

about half of the deliverables in the law. Now, as I'm sure you can appreciate, all action 

items are not created equal. Some are very complex and require a good deal of input 

from our workforce and industry partners. I believe that meaningful collaboration is the 

only way to achieve a workable path forward. Doing what we need to do to get the most 

effective work product is our goal, although we recognize that may mean some deadlines 

are not met. 

Safety 

Safety is FAA's number one mission, and our system has never been safer. There has not 

been a fatal commercial passenger accident in the United States since 2009. I am proud 

of the hard work that has gone into providing a basis for achieving this level of safety. 

We need to make aviation safety interventions smarter through risk based approaches. 

The best way to prevent accidents before they happen is to accurately identifY risk areas 

and work to mitigate them. That is one reason we are working hard to improve runway 

safety areas (RSAs) at commercial service airports. Some of the RSA improvements 

include the installation of the Engineered Materials Arrest System (EMAS). This soft 

3 
25 


Insert offset folio 12 here 80937A.012

concrete block system has been installed in RSAs at 45 airports in the U.S. These EMAS 

systems have already stopped eight overrunning aircraft with no fatalities or serious 

injuries to passengers. Voluntary incident reporting for both FAA and industry 

employees, safety management systems (for both FAA and industry) and the creation of 

the Aviation Safety Whistleblower Investigation Office have also helped to improve the 

level of safety in our aviation system, by providing us with additional data and incident 

information that we may not have had access to previously. More information results in 

FAA being able to see trends and take action to mitigate the associated risks. Adjusting 

the safety culture to ensure employees that they can provide information without fear-of 

reprisal is a cornerstone of our approach to safety. 

Prior to Reauthorization, we had been working on the requirements of the Airline Safety 

and Federal Aviation Administration Extension Act of201O. That act mandated 

rulemakings to revamp flight and duty time regulations to better address the issue of pilot 

fatigue, to increase the required number of hours offlight experience before a pilot can 

qualify to be a commercial pilot, and to revise pilot training to better simulate challenging 

conditions so that pilots can better handle serious, but rare situations. We completed the 

flight and duty time rulemaking just over a year ago, and plan to complete our work on 

the final pilot qualification rulemaking (New Pilot Certification and Qualification 

Requirements) by August 2013 and pilot training (Qualification, Service, and Use of 

Crewrnembers and Aircraft Dispatchers) by October 2013. 

4 
26 


Insert offset folio 13 here 80937A.013

With respect to other safety directives in Reauthorization, FAA commissioned an 

Aviation Rulemaking Committee (ARC) to develop recommendations to improve our 

aircraft certification process: we delivered our Report to Congress on that effort in 

August oflast year and have begun implementation of the report's recommendations. 

We also established an ARC consisting of govemment and industry experts to develop 

recommendations on improving the consistency of regulatory interpretations. Weare in 

the process of finalizing a report informing Congress of the recommendations presented 

to the FAA. 

Reauthorization also required a number of safety-related reports. We have delivered the 

report required on runway safety alert systems and the first annual report of the Aviation 

Safety Whistleblower Investigation Office summarizing the disclosures the office has 

received and how they were handled. We published the report on Research and BirdDetecting Radar. In the upcoming weeks, we expect to issue reports on the Air Carrier 

Evaluation Program, night vision goggles for helicopter pilots, improved pilot licenses, 

and limiting access to the cockpits in all cargo aircraft. Weare also finalizing a report to 

Congress on common sources of distraction on the flight deck. 

Pursuant to Congressional direction, we have also worked with the Occupational Health 

and Safety Administration (OSHA) to draft a statement of policy which permits some 

OSHA standards to be applied to improve workplace safety for aircraft cabin crew. We 

published a draft policy statement in the Federal Register in December of2012 for 

comment, and are in the process of reviewing those comments. 

5 
27 


Insert offset folio 14 here 80937A.014

Also in accordance with reauthorization, in October of last year, the FAA, in conjunction 

with the Department of State, issued a cable regarding international drug and alcohol 

standards for foreign repair stations. An advanced notice of proposed rulernaking 

(ANPRM) is currently in executive review. 

Delivering Technology 

Our goal in the area of delivering technology is to efficiently and sustainably deliver 

benefits to our stakeholders and society. One of the responsibilities of the Deputy 

Administrator is to serve as our ChiefNextGen Officer, so that is one of many reasons I 

hope to appoint a Deputy relatively quickly. 

Throughout Title II of the Reauthorization, there is a theme that modernization of the 

system must be done in collaboration with our industry partners. FAA wholeheartedly 

agrees with this concept. Imposing technological changes without the input of the users 

would be a recipe for failure. We continue to improve the efficiency of our Nation's 

airspace through our work with Optimization of Airspace and Procedures (OAPM) 

initiatives, which are being done in close collaboration with industry and stakeholders. 

OAPM work has begun in nine of the 13 metroplexes identified in Phase 1 of the 

program. Of these, one of the metroplexes (Houston) is currently in the implementation 

phase with an additional site (Washington, DC) planned to start implementation of 

additional new procedures later this fall. We continue to assess the best way forward to 

produce benefits at metroplex sites in light of sequestration impacts. The metroplex 

6 
28 


Insert offset folio 15 here 80937A.015

initiative optimizes procedures in a geographic area where there are a number of airports, 

rather than focusing on each airport separately. Through this initiative, we are untangling 

our busiest airspace and creating more direct routes, cutting fuel, and becoming more 

environmentally friendly. In the congested airspace in the skies above our busiest 

metropolitan areas, these new modifications are being put in place in about three years, 

much more quickly than the five to ten years it had taken previously. We are also 

actively engaged with our industry and government partners in the development of 

NextGen through the NextGen Advisory Committee (NAC). This group is helping to 

guide many aspects of our air traffic modernization work. The NAC also works with 

FAA on developing and tracking performance metrics and advising on the technical 

challenges of one of the new categorical exclusion provisions included in 

Reauthorization. FAA has an initial set ofNextGen metrics available on our websites 

and expects to publish additional performance in the coming months. On our NextGen 

Performance Snapshots (NPS) site we are making the information more robust in order to 

better report on performance as a result ofNextGen implementation. 

Reauthorization also provides FAA with the ability to consider using operational and 

fmancial incentives for commercial and general aviation operators to equip their aircraft 

with NextGen technology. We are actively engaging aircraft operators and potential 

private partners to assess interest and receive feedback on equipage incentive programs 

and how use of this authority could attract additional investment in NextGen technologies 

and training. 

7 
29 


Insert offset folio 16 here 80937A.016

FAA has completed a departure queue management pilot program that was required in 

the statute in order to continue to advance plans to enhance surface management at 

airports. Also, in accordance with Reauthorization, we will be issuing guidance for AlP 

funding eligibility that supports the importance of sustainability initiatives in the way that 

airports do business, in 2013. We have also initiated a new study on the National Plan of 

Integrated Airport Systems (NPIAS), which is a long-established process for identifying 

and prioritizing strategic investments. The new study will ensure we are making the best 

use of available data in supporting our decisions to advance safety, capacity, efficiency, 

and sustainability initiatives. 

Finally, in February, pursuant to Reauthorization, the FAA requested proposals for 

interested state and local govermnents, eligible universities, and other public entities to 

develop six Umnanned Aircraft Systems (UAS) test sites around the country, which will 

gather information to help inform research, development, operational and privacy issues. 

We expect to select the six sites by the end of the year. These sites will conduct critical 

research that will help determine how best to integrate UAS into the NAS. Once the sites 

are operational, we expect to leam how UAS operate in different enviromnents and how 

they impact air traffic operations. I know this Committee is very interested in UAS 

integration. Use of the six sites will provide us with essential information to facilitate 

integration ofUAS into the NAS and to address outstanding issues, such as privacy. 

Prior to finalizing the FAA's UAS five-year "Roadmap", the FAA is coordinating the 

roadmap with other UAS stakeholder agencies and ensuring aligmnent of that roadmap 

8 
30 


Insert offset folio 17 here 80937A.017

with the Joint Planning and Development Office's (JPDO) Interagency Comprehensive 

UAS Plan. 

Empower and Innovate FAA's Workforce 

In the current fiscal climate, we have to find a way for FAA's employees to work smarter 

and enhance our productivity. You tasked us to undertake a thorough review of each 

program, office, and organization within the agency. Our report on FAA Review and 

Reform highlights 36 initiatives to improve and update processes, eliminate duplication 

and waste, and make the agency more efficient and effective. The initiatives identified 

cover many aspects of our operations and include improvements to cost analysis, 

governance, acquisition processes, standard operating procedures, and human resources. 

Of the 36 initiatives, 22 have been implemented and 14 are in progress. In addition, we 

are actively engaging our employees in the development of recommendations for 

facilities consolidation and realignment. 

At your direction, we are looking closely at improvements to staffmg and training for our 

employees. Four studies are underway looking at frontline manager staffing 

requirements, technician staffing, air traffic controller staffing and air traffic training and 

scheduling. As required by law, the FAA submitted interim Aviation Safety and traffic 

Controller workforce plans to Congress on March 31, ten days prior to the FY 2014 

budget submission which was sent on April 10. Due to the requirement to produce these 

plans by March 31, 2013, the workforce plans do not reflect the effects of sequestration, 

as modified by the recent change to FAA budget reprogramming authority. In addition, 

9 
31 


Insert offset folio 18 here 80937A.018

the reports do not reflect the restrictions in place as a result of sequestration, such as the 

hiring freeze and reduced contract training support and travel. The FAA will adjust the 

actual staffing and hiring forecasts to reflect future funding levels as they become 

available. Finally, in accordance with Reauthorization, we developed staffing and 

scheduling plans for New York City and Newark air traffic control facilities. 

Develop and Fund the Efficient FAA ofthe Future 

FAA must not only meet our day to day responsibilities, we must also look to the future 

and figure out how to shape the agency to meet the demands and opportunities of the 

future. As noted earlier, the u.s. aviation system is going through significant, even 

revolutionary changes. NextGen is a major transformation which will increase our 

efficiency and safety, reduce delays and reduce fuel consumption. UAS have the 

potential to change the face of aviation. Weare also looking at ways to restructure our 

small airplane certification rules so new safety standards and technologies can be 

introduced more quickly while, at the same time, we reduce the overall costs of certifying 

general aviation airplanes. In the midst of these changes, budget pressures are making us 

ask hard questions about what the FAA needs to deliver in the coming years to ensure the 

safety and efficiency of the NAS and how to do it most cost-effectively. 

In addition, we will face major changes in our workforce in the coming years. About one 

third of FAA employees will be eligible to retire starting 2014. So for us, succession 

planning remains a crucial aspect of the agency's focus, and we realize that we will begin 

to lose a vast amount of corporate knowledge in the coming years. To prepare for that, 

10 
32 


Insert offset folio 19 here 80937A.019

we must impart this knowledge to today's emerging leaders and experts to ensure a 

successful agency in the 21st century. We need to embrace innovation and to work 

efficiently. 

Efficiencies are not just for the future. FAA has worked very hard to fInd cost savings 

and we have been quite successful. In fiscal year 2012, FAA efficiencies and cost cutting 

resulted in $81 million in savings. As part of our ongoing efforts to reduce our costs, we 

had set a target of$91 million in cost savings for fiscal year 2013, including aggressive 

targets for IT spending reductions and strategic sourcing initiatives. As you can see, cost 

savings are part of our ongoing program and are helping us meet cuts needed for 

sequester. However, larger cuts as a result of sequestration are challenging and will have 

impacts to the maintenance of the NAS, certifIcation of new systems, and the 

development of NextGen programs. 

Finally, we must chart innovative and collaborative ways to engage with all segments of 

the aviation sector, from airlines to association groups, to general aviation, to unions. We 

must embrace the opportunity to make long-lasting changes together that ensure a vital 

and vibrant aviation industry that serves the needs of this nation. 

Advance Global Collaboration 

The world is increasingly interdependent, so international collaboration is essential if we 

want to move forward effectively. FAA needs to continue to work with international 

partners to improve global aviation safety and sustainability. This effort will require us 

11 
33 


Insert offset folio 20 here 80937A.020

to improve the harmonization and interoperability of new technology with international 

aviation standards and procedures to improve safety on a global basis. We need to work 

to ensure the roadmaps agreed to by the International Civil Aviation Organization 

(lCAO) to advance communications, navigation, and surveillance improvements for 

global air navigation are compatible with our NextGen concepts and implementation and 

our domestic regulatory plan. We are working at lCAO to find practical and 

collaborative solutions to address aviation's greenhouse gas emissions and are 

encouraged by the European Union decision to "stop the clock" on application of their 

emissions trading system on foreign airlines. Our international partnership will require 

us to develop and begin to implement a strategic plan for technical assistance, training, 

and other activities to maximize the value of FAA's expertise and United States 

resources. The FAA is committed to working proactively with countries around the 

world to create the initiatives and achieve the outcomes we need in the areas of safety, air 

traffic management, and the environment to foster a safe, efficient and sustainable global 

aviation sector. 

Conclusion 

Let me conclude by saying that it is essential to the effective management of FAA's 

programs to have programmatic and funding stability and predictability that can be relied 

upon. The many extensions over the last few years took a toll on FAA's work in certain 

areas, and unfortunately the current sequester also reintroduces the uncertainty that we 

had hoped the passage of reauthorization would address. All of us in this room want the 

same things. We want to get better at what we do, think smarter, improve safety, 

12 
34 


Insert offset folio 21 here 80937A.021

streamline certification, and remain the agency that can work collaboratively with the 

world to develop safer and more efficient practices. 'Even without furloughs, funding 

restrictions ,are preventing us from hiring and training our next generation workforce and 

are forcing us to rely on employee attrition to meet required deficit targets. Identifying 

and implementing processes that help us do more with less is always a valuable exercise, 

but our ability to meet the long-term goals of reauthorization will be in jeopardy. 

Mr. Chairman, that concludes my statement. I will be happy to take questions at this 

time. 

13 
35 


Insert offset folio 22 here 80937A.022

The House Committee on Transportation and Infrastructure's Subcommittee on Aviation 

Hearing on Review of FAA's Implementation of the FAA Modernization and Reform Act 

Thursday, May 16, 2013 

First Set of Questions for the Record, May 21, 2013, for FAA Administrator Michael Huerta 

Frank A. loBiondo - New Jersey 2nd District 

Question: 

l.The FAA Reform Act tasked the FAA with working with industry to review, 

assess and reform the certification and approval process for aircraft and aircraft 

engines and parts. In conducting the assessment, the FAA was to make 

recommendations to improve efficiency and reduce costs through streamlining and 

re-engineering the certification process and provide Congress with a report by 

August 2012 and implement the recommendations by February 2013. What is the 

status of these recommendations? 

Answer: 

The report was submitted to Congress on Aug 13,2012. The FAA Aircraft 

Certification Service developed an implementation plan that is responsive and ontrack to address the reforms identified as mandated in Section 312 of the FAA 

Modernization and Refonn Act of 20 12. 

Question: 

2. Has the FAA established the Advisory Panel, mandated by the Reform Act, to 

determine the root causes of inconsistent interpretations of regulations and to 

develop recommendations to improve consistency and communication? If so, what 

is the status of this panel's activities and when can we expect the report which was 

due in February? 

Answer: 

The FAA established the Consistency of Regulatory Interpretation Aviation 

Rulemaking Committee (CRI ARC) in accordance with P.L. 112-95 (Section 313) 

to determine the root causes of inconsistent application/interpretation of 

regulations, and develop recommendations to improve consistency and 

communication. The CRI ARC has completed its analysis and submitted six 

recommendations to the FAA. The FAA Report to Congress now in executive 
36 


Insert offset folio 23 here 80937A.023

review details the ARC's recommendations, as well as the FAA's evaluation and 

proposed implementation plan to address each recommendation. 

Question: 

3. Following the FAA's subm ission of its report on the review of each program, 

office and organization within the FAA identifYing duplication, wasteful practices, 

redundancies, inefficiencies, and outdated policies, the FAA was required to 

undertake such actions as may be necessary to streamline and reform the Agency. 

The Act specifically gives you the authority to take those actions necessary. What 

actions have you undertaken to date? What actions are planned in the near future? 

Answer: 

The FAA Modernization and Refonn Act of2012, Section 812, requires the 

Federal Aviation Administration (FAA) to undertake a thorough review of each 

program, office, and organization within the Agency to improve and update 

processes, eliminate duplication and waste, and make the Agency more efficient 

and effective. The FAA was then to take the actions necessary to address the issues 

found, using the authority granted under the Section, and report to Congress on the 

actions taken. The report submitted in January 2013, was organized according to 

each FAA organization for which actions were identified for process improvement. 

It highlighted 36 major projects and recommended solutions from across the FAA. 

Of the 36 projects listed, 16 are implemented and complete and 20 are in-progress. 

All of the implemented or in-progress initiatives identified in this report were 

completed or are presently being executed in FY 2013 and are described in more 

detail in the attached summary file. 

r~-ro-b-l-e;;_m;;:::::::::_-::::::::_~:-=S-c::o--=-I-u:t=I-' o:n~-:~-=·=======~:S=ta:t=u:s====.·.· .. ·_-_-._-_-=·---1-

2.1 Office of Finance and 

Management (AFN) 

2.1.1 Shared Services Financial functions Implemented. 

I Optimization (Finance) previously performed 

I Finance functions are performed in the Air Traffic 

in many FAA organizations Organization moved 

resulting in lack of standardized to the Office of the 

processes, inadvertent duplication Chief Financial 

i of effort, lack of economies of: Officer. Finance 

I scale, difficulty of oversight and I resources from the L cost control. and/or created Regions and Center, I 
37 


Insert offset folio 24 here 80937A.024

--- . unclear lmes of aUUlVlllY and 

responsibility. 

2.1.2 Shared Services 

Optimization (Acquisitions) 

FAA's Acquisition Executive is 

responsible for all of the FAA's 

acquisitions but was housed in the 

Air Traffic Organization (ATO) 

and Contracting Officers were in 

different Vl too. 

Acquisitions, and 

Infonnation 

Technology 

organizations moved 

to the Office of the 

Chief Financial 

Officer (CFO). A 

portion of the Office 

of Aviation Safety 

(AVS) workforce 

planning positions 

moved to the CFO as 

well. 

Centralize Acquisition 

functions and identifY 

areas of process 

improvements. 

Implemented. 

2.1.3 Shared Services Centralize 

Optimization (Information Infonnation 

Services/CIO) Technology 

There are duplicative infonnation functions 

In-Progress. 2014 

President's Budget 

(IT) includes base 

and transfer to complete 

services, systems, and establish the transition to one 

infrastructures making it difficult Memorandums Of 

to integrate the infonnation Agreements shifting 

centralized IT 

Shared Services 

systems, achieve economies of the supervision of organization. 

scale, provide efficient server full-time IT 

usage, consolidate data professionals to the 

processing facilities and maintain centralized 

'1 cyber security across multiple infonnation servIces 

platforms/organizations. , organization. 

2.1.4 Shared Services ! Establi~h---=S-er-v-:i-ce--t--:C-Im'plemented. 

Optimization (Service Level Level Agreements 

Agreements) (SLA). 

Customer organizations need a 

way to set levels of expected 

services. 

I 

I 
38 


Insert offset folio 25 here 80937A.025

------ ---~------:c----::-------- ---------:----,----,:::----:-:-::---::----,:::---:--------:--------1 

2.1.5 Shared Services Consolidate Property Implemented. 

Optimization 

Management) 

(Property functions (assets 

Property Management 

responsibilities reside III many 

FAA organizations. 

inventory and real 

property) into Regions 

and Center Operations 

(ARC) (Assets 

inventory and real 

property). 

2.1.6 Shared Services The Administration 

Optimization (Administration functions within 

Management) Employee Services, 

Administration functions Operational Services, 

performed across the AFN and Performance 

organizations varied. Management were 

centralized in the new 

AFN Administration 

and Field Integration 

organization. 

In-Progress. The 

Division of 

Administration and 

Field Integration 

Services (AFN 100) 

was established June 

5,2012. 
39 


Insert offset folio 26 here 80937A.026

r-------- --------r~-~~ ~-------~-_rc---~--~-~--~--., 

Problem Solution Status 

2.1.7 Shared Services 

(Common 

Implement a common Implemented. 

Optimization 

Timekeeping) 

Employees being transitioned 

into AFN from the A TO have 

been using a different 

timekeeping system and labor 

~ing system. 

2.1.8 Records Management 

Reform 

The FAA Records Management 

environment is out-of-date, 

lacks automation, and is not 

fully compliant with all 

National Archives and Records 

timekeeping system 

withinAFN. 

Modernize 

management 

Electronic 

Management 

eDiscovery 

records 

via the 

Records 

and 

Initiative. 

In-progress. Issued a 

FOIA/eMail search 

policy May 2013. 

Administration requiremel1-=:ts:.:... -+::_-_,__----__:_---:-1--::--.,-------:----1 

2.1.9 Cost Reductions Implement a broad- Implemented. 

The Executive Order on based set of initiatives Agency achieved 

efficient spending has identified to reduce cost across $81 M in cost savings 

opportunities to find savings FAA in support of the in FY2012. As part 

through efficiencies m SIX Executive Order on of our ongoing 

targeted categories. Efficient Spending. efforts to reduce 

costs. We had a 

target savings of 

$91M for FY20l3, 

including aggressive 

targets for IT 

spending reductions 

and strategic 

I--_______ ~ ____ +-__________ +_=_so-'-u:.c.r'-'-c=ing~initiatives. 

2.1.10 Governance Executive level 

A review of the FAA's cross- committees were 

I organizational executive reviewed, consolidated, 

I 

committees showed inefficient and streamlined; roles 

use of executives' time with and responsibilities 

Implemented. 

I I' . ! over appmg commlttee.-,-s_. ~~. ___ --:-+-::w=--e-'--r ...... e_c'__:l_ar'_'_ic...fi ..... ed_.=___--__:_-+::_-_,__---_:_--__I 

1

2.1.11 Regional International Executive Operations Implemented. 

I Organization for will collaborate with the Executive 

I Standardiz~tion (ISO) Office OL!h~B:~g~,-Q£.erations and the 
40 


Insert offset folio 27 here 80937A.027

,----------------

Implementation Administrators to 

There is a of develop Standard 

standardization each Operating Procedures 

Region's Executive Operations (SOP), implement ISO 

Division key functional area and conduct a staffing 

lack 

of 

processes and staffing study. 

inconsistencies. 

Logistics Service 

Areas are ISO 

certified. 

2.1.12 Cost/Price Analysis Establish a Cost/Price Implemented. 

Internal and Office of Inspector Analysis Services group 

General (OIG) reviews of FAA within Acquisitions. 

acquisitions identified 

weaknesses in cost and price 

analysis. 

2.1.13 Strategic Acquisitions Consolidate strategic Implemented. 

Strategic acquisition initiatives sourcing, purchase card 

dispersed among multiple program, and other 

organizations. strategic initiatives into 

a new Strategic 

Acquisitions 

Organization. -.~-~~-~--0~~--~--~ 

2.1.14 FAA Academy iPad The Academy will use Implemented. 

Pilot the iPad tablets and 

Create a paperless efficient other technology to 

learning environment. present course 

materials, training aids, 

and equipment 

documentation. 
41 


Insert offset folio 28 here 80937A.028

r------------------,-c:-:-c---:---~ ~-----___r_::c_---~-- -----~, 

Problem Solution Status 

2.2 Office 

Resources 

(AHR) 

of Human 

Management 

2.2.1. Back to Basics and HR continues to work 

Office of Human Resources with our line of business 

Transformation 

Lines of Business (LOB) and 

services/offices were not 

satisfied with the level of 

customers. 

Collaborated with 

customers to identifY the 

15 core HR functions 

service they were receiving considered critical to 

Surveyed 

in FAA's 

from Human Resources (HR). success. 

customers 

LOB to identifY 

suggestions for 

improvements and to 

baseline current service 

to measure future 

improvements. 

2.2.2. HR Training HR and the Training 

Redundancies in purchasing and Development 

training. Council conducted a 

training audit that 

identitied redundancies 

In-Progress. Project 

IS no longer called 

"Back to Basics"; 

has been renamed 

"Customer Service." 

In-Progress. 

2.3 Office of NextGen (ANG) 

in training ef=-fo:c:rt-"s=-:. __ --f ________ -I 

2.3.1. NextGen Initiative 

An assessment of the current 

state of NextGen, and the 

location and role of the 

NextGen office within the FAA 

showed that internal structures 

and operating models needed to 

improve III order to ensure 

successful implementation of 

I NextGen. 

Processes - improve the Implemented. 

concept-to-program 

process to include 

program management 

best practices, enhanced 

transparency, and clear 

ties to the FAA 

Acquisition 

Management System 

(AMS). 

Governance establish 

critical decision points 

throughout the conceptto-program process to 
42 


Insert offset folio 29 here 80937A.029

-~~~~~~~------~~~~--~-------~~-~~-~~------~~~---

elevate infonnation for 

senior level decisions. 

Operating Model -

establish an FAA 

NextGen staff office 

(via an appropnatlOns 

reprogramming of the 

ATO NextGen office) to 

report directly to the 

FAN s Deputy 

Administrator. 

2.3.2. NextGen Initiative Create a centralized Implemented. 

Transfonn the National organization (NAS 

Airspace System (NAS) Lifecycle Integration 

through NextGen activities. Directorate) to drive a 

NAS-wide focus for 

I-~-~-----~ instituting chang_~s.:_~ ____ +-____ ~ _____ ~ 

2.3.3. NextGen Initiative 

Transfonn the NAS with a 

structured, coordinated, 

collaborative process to enable 

NextGen activities. 

Refine and implement 

Ideas 2 Implementation 

(121) Process related 

initiatives to ensure 

cross Agency alignment 

on NextGen 

Implemented. 121 

was completed in 

March 2013. 

Implementation. I--___________ ~~ _ _+~::L.:..:.:=:..:=.:.:.:.:::.c:.c::"---_+---------~-~ 

Institutionalize 121 Implemented. 12Iwas 

integrated into AMS 

in April, 2013. 

2.3.4. NextGen Initiative 

Current acquisition process 

show that NextGen programs 

and activities are not 

process. 

adequately manag~~.~~ ______ --L __________ L _______ _._J 
43 


Insert offset folio 30 here 80937A.030

~~-~~--~ I St.t., ---~-

Problem Solution _.-.-

2.4. Office of the 

~dministrlltor (AOM ~~-

2.4.1. Office of Audit and Consolidate hotline Implemented. 

Evaluation Hotline reporting functions to 

Consolidation make interactions with 

Multiple data collection Office of the Inspector 

points existed for safety General/Government 

I 

concerns and whistle blower Accountability 

contributions. Office/Office of Special 

Counsel (OIG/GAO/OSC) 

more productive. 

2.5 Policy, International 

Affairs & Environment 

(APL) 

2.5.1. FAA Greening The Office of In-Progress. 

Initiative Environment and Energy 

The FAA has a large number (AEE) facilitates Agencyof employees, buildings, wide sustainability 

facilities, and vehicles to program that promotes 

support and maintain the energy efficiency 

NAS. increases and improved 

stewardship of natural 

resources, resulting in cost 

savings. ~ ~ 

2.6 Office of Airports (ARP) -

2.6.1. Geographic Balancing Standardizing field office In-Progress. 

Effort structure(s) and balancing 

Field staff overload due to field work load within the 

96% increase in grants and Office of Airports. I 

safety workload, with only an 

8% increase in staff positions. - 2.6.2. Standardization and Standardize the field In-Progress. 

Standard Operating operations by developing 

Procedures (SOP) Standard Operating 

Development Procedures of core 

Lack of standardization functions, allowing 

creates internal confusion, stakeholders to expect 

adds additional workload/_(lI1~ consistent ivery from 
44 


Insert offset folio 31 here 80937A.031

,-:--:----_ ... _-_._----;--,....---------_.-----_._-- ~----.------~ 

lacks corporate risk region to region. 

~<lgement. ________________ +-_________ .. _ 

2.7 Security & Hazardous 

Materials Safety (ASH) 

2.7.1. Security Awareness 

Virtual Initiative (SA VI) 

Pretest Training Option 

Employees who took the 

annual SA VI Training wanted 

an opportunity to have an 

option to test out of the 

annual requirement that 

results In a more efficient 

manner of meeting this 

ASH established a test out Implemented. 

option for employees to 

complete this annual 

mandatory training. 

~e~m~en~t~.----~~----~~~~-----~~~:~~~=---------~ 2.7.2. Safety Management Collaborate with Flight In-Progress. 

System Integration Standards to integrate 

Currently A VS and ASH have Hazardous Materials 

two separate systems used to inspection data into a 

collect safety data. This central safety management 

results in duplicative system. 

'--p~ograms and inefficiencies::..:.-=-+-= __ :__----=---:c------~-=---:~--:__---__1 2.7.3. Emerging Role of Review core functions to Implemented. 

ASH ensure they are properly 

Internal FAA customers have aligned towards ASH's 

come to ASH requesting mission, business plan 

various activities which we objectives, and 

believe are not within ASH's Destination 2025 goals. 

responsibilities. This may 

result in using resources on 

functions that are duplicated 

elsewhere within the FAA. 
45 


Insert offset folio 32 here 80937A.032

'P=-ro-cb:-clc-e--m---------r=S-O-:--luii-o-n-------~I-S-t-a-tu-s---_~~~~ __ ~ 

2.8 Office of Commercial :--

Space Transportation {!\.ST) 

2.8.1. Reorganization Create a new division Implemented. 

Increasingly varied and and staff offices; shift 

complex space launch systems focus to specialized 

and increased workload functions within 

requirements demand that AST divisions. 

become more efficient In 

meeting its operational 

~guirement=s~.~~-~----+.~---:--------~~~~----------~ 

2.8.2. Staff Relocations to Move inspectors and In-Progress. 

Field Offices engineering staff to 

AST inspectors and technical 

staff must travel from FAA HQ 

in Washington, DC, to perform 

their safety functions at the 

various space launch facilities 

across the United States. 

field offices to reduce 

travel costs. 

~--~--------~--------r-----------------r_---------------

2.9 Air Traffic Organization 

~IQL)-----~~~---j~~~~----~~~ __ ~----~ '2.9.1. ATO Realignment: The PMO was created Implementation 

Project Management Office to consolidate complete and 

(PMO programs which were functional. 

ATO System acquisitions were previously embedded 

distributed throughout several In several atr traffic 

operational service units. offices. Placing the 

responsibility for the I 

program management I 

of major ATO system 

acquisitions into a 

single organization is 

. facilitating work with 

thc NextGen 

organization on 

NextGen related air 

traffic system , 

acquisitions and their 

integration into air 

fully 
46 


Insert offset folio 33 here 80937A.033

r::--:--c---:-="C:--=---:c:--------r-=--::---;------------- ---::-----,-----::-------

2.9.2. ATO Realignment: Following industry Implemented. 

Safety & Technical Training best practices, Safety 

Safety and Technical Training and Technical Training 

for the entire A TO Operational were aligned into one 

workforce were conducted organization to help 

separately, and risk the Service Units 

management was not well identify risk better and 

enough connected to ensure the maintain a well-trained 

development of a well-trained workforce. 

workforce. 

r-- . 2.9.3. ATO RealIgnment: Strategy and Implementation 

Management Services Perfonnance was completed for most of 

Strategic labor relations, transitioned into the Management 

human capital management, Management Services Services Functions. 

employee and organizational to combine redundant In particular, Labor 

development, communications, organizations into one Relations, Business 

business and administrative, location, and to and Administration, 

fiscal prioritization and provide shared and Fiscal 

contract functions were business and Prioritization. 

distributed across all service administrative 

units. operations supp_..:.o_rt_. __ L-_________ --' 
47 


Insert offset folio 34 here 80937A.034

----~----------,_:c_c---c-- ---------,-:c-----------

Problem Solution Status f~~~~----~~~~_+=~ 

2.10 Office of Aviation 

~~~----1--- c--------c'-t-------:------j 

2.10.1. Unmanned Aircraft Establish a new UAS Implemented, The 

Systems Integration Office Integration Office in Administrator 

Stand-Up Flight Standards assigned executive 

Integration of Unmanned dedicated to integrating level leadership m 

Aircraft Systems (UAS) into UAS operations safely March 2012 and 

the NAS is a top agency into the NAS within a officially approved 

priority and IS a complex NextGen context. the UAS Integration 

effort. Create a single focal office on Jan II, 

point for UAS 2013. 

operations 

direction 

executive, 

under the 

of one 

----~--~~--+ 2.10.2. Office Consolidation The two offices were Implemented. 

The Office of Safety Analysis merged and their 

(ASA) provided the data functions combined to 

analysis capability while the create the Office of 

Office of Accident Accident Investigation 

Investigation (AlA) and Prevention (AVP), 

investigated the accidents. 

2.10.3. Office Closure 

Flight Standards Service is 

examining its "international 

office footprint" to improve 

the efficiency of its service 

delivery. 

Close 

International 

Office (IFO). 

London Implemented. 

Field 

Office 

responsibilities 

transferred to Frankfurt 

[FO and IFO in NY. 

2.11 FAA - Joint Resources 

Council (JRC) Review of 

investments ~~~~~----------+--_c_--~-----~--------------

FAA - Joint Resources Review acquisitions In-Progress. 

Council (JRC) Review of and FAA investment 

investments The FAA has not strategy to optimize the 

:~::~;:zed its SYS~~~::~~a~~ ~:~eiv~~ the fund~~~ II 

decisions on capital projects anticipated. 

I 

and operations and 

maintenance requirements 

L_given c()rnp~ting funding ~ 
48 


Insert offset folio 35 here 80937A.035

FAA 

Question: 

4. The Refonn Act required the FAA to redesignate the Director of the Joint 

Planning and Development Office, currently Dr. Karlin Toner, to Associate 

Administrator, has this been done? Ifnot, why not? 

Answer: 

Action regarding the Chief NextGen Officer and the redesignation of the JPDO 

position has been pending the appointment of a new Deputy Administrator. 

During this time, the JPDO has continued to function as the primary body to 

consider long-tenn concepts for NextGen, as well as take the lead for interagency 

coordination on NextGen and other select issues. While the JPDO Director 

currently reports to the Chief Operating Officer for daily operations, she meets 

regularly with the Secretary of Transportation and FAA Administrator in her role 

as principal advisor on strategic policy, as well as industry and intergovernmental 

issues relating to NextGen. The new Deputy Administrator took office on June 3. 

As deputy, he will fulfill the position of Chief NextGen Officer and will have 

broad responsibilities for NextGen within the agency. Among his priorities, will 

be addressing the reauthorization NextGen requirements including the JPDO 

Director redesignation. 

Question: 

5. The FAA has indicated that in January 2013, the Agency granted "pay 

increases" to a quarter of the agency's 45,000 employees. When were these 

increases approved, and what was the total dollar amount provided in January? 

(Please provide details on the breakout by appropriations account and by line of 

business.) 

Answer: 
49 


Insert offset folio 36 here 80937A.036

Approximately 11,000 FAA employees were approved to receive performancebased pay increases in January 2013 under FAA's Core Compensation Plan. This 

group consists primarily of FAA employees not covered by collective bargaining 

agreements and field supervisors for air traffic and aviation safety personnel. 

These increases, which were approved in January, averaged 1.6% and include the 

OSI (Organizational Success Increase) based on FAA performance and the SCI 

(Superior Contribution Increase) based on individual performance. In aggregate, 

FAA estimated that the FY 13 cost of these pay increases would be approximately 

$19 million across all budget accounts. 

Question: 

6. According to FAA statements, the recently enacted "Reducing Flight Delays Act 

of 20 13" will allow the FAA to transfer sufficient funds to end employee furloughs 

and keep the 149 contract towers originally slated for closure in June open for the 

remainder of the fiscal year 2013. 

• Which accounts and lines of business received additional funding (please break 

out how much will be transferrcd to end the furloughs and how much to keep 

the contract towers open.) 

• How much did FAA save from furloughs? 

• Were there any costs incurred by State or local communities who had intended 

to continue the contract tower program at their respective airports? 

Answer: 

The agency intends to transfer $253 million from the Grants-in-Aid airports 

account to the FAA operations account ($247.2 million) and the Facilities and 

Equipment account ($5.8 million). The transfer will allow FAA to end employee 

furloughs and keep 149 low-activity contract towers, originally slated for closure 

in June, open for the remainder ofFY 2013. The FAA will also minimize cuts and 

delays in core NextGen programs and partially restore infrastructure support 

activities in the national airspace system, thereby reducing the risk of delays. 

FAA estimates that one week of furloughs from April 21, 2013 to April 27, 2013 

resulted in an estimated savings of $8.7 million. 

Finally, the FAA is unaware of costs incurred by airport authorities or local 

communities who had planned to continue to operate these towers at their airports. 
50 


Insert offset folio 37 here 80937A.037

Question: 

7. According to the FAA statements, the "Reducing Flight Delays Act 0[2013" 

will also allow the FAA to put $10 million towards reducing cuts and delays in 

core NextGen programs and approximately $11 million to partially restore the 

support of infrastructure in the national airspace system. 

• Which accounts will receive the additional funding? 

• What programs and activities will be funded? 

• How were these programs impacted by the sequester? 

• Will these funds be obligated in FY 2013? 

Answer: 

The additional $10 million provides for $5 million to fund operational personnel 

backfill, overtime, and travel to support key modernization systems and activities 

related to NextGen. These include continued support for the delivery ofERAM to 

the field including key NextGen capabilities, such as the teams that support 

surveillance data processing in support of ADS-B and strategic weather reroutes 

that link ERAM with our strategic flow, the teams supporting the T AMR program, 

and the teams necessary to design and implement PBN procedures in the OAPM 

program. 

The other $5 million supports the NextGen ERAM D-position program, more 

accurately named System and Sector Enhancements. In the near tenn, this 

program provides improvements to enroute automation that have been identified 

while the original program was in its three releases. These improvements are 

identified through the nonnal operations and were addressed every 12-18 months. 

These improvements, which support NextGen goals, have been on hold for several 

years. This additional funding will allow not only the investment decision to be 

completed this year and but also engineering efforts to begin with the upgrades 

hitting the field in 2015. This matches our ERAM deployment schedule 

completion and meets our commitment to the workforce to begin providing these 

additional capabilities. 

Question: 

8. What is the status ofInternational Civil Aviation Organization (ICAO) talks 

related to international aviation emissions? 
51 


Insert offset folio 38 here 80937A.038

Answer: 

In November 2012, the International Civil Aviation Organization (ICAO) Council 

established a High-Level Group of Senior Government Officials to provide 

recommendations for further action on addressing aviation greenhouse gas 

emissions in advance of the upcoming Assembly in September. As of April 20 13, 

this group has met three times and provided input to the ICAO Council for 

consideration in advance of the Assembly. The focus ofthe group includes further 

work on market-based measures, such as cap-and-trade, but also includes 

consideration of technology, operational improvements and alternative fuels. The 

U.S. Government is actively engaged in efforts to shape the eventual outcome of 

the ICAO Assembly in order to achieve U.S. objectives of making further progress 

on climate change. 

Question: 

9. Do you believe the Small Airplane Revitalization Act will better utilize FAA 

resources, decrease the cost of certification, and improve safety? 

Answer: 

The Administration has not taken a position on proposed legislation. In this case, 

we note that the proposal closely aligns with recommendations we have received 

from industry to improve our certification process. 

Question: 

10. The Small Airplane Revitalization Act essentially implements the 

recommendations of the Part 23 Aviation Rulemaking Committee (ARC). Do you 

know when this ARC is scheduled to complete its report and make their 

recommendations? 

Answer: 

The ARC final report is expected to be completed by this summer. 
52 


Insert offset folio 39 here 80937A.039

The House Committee on Transportation and Infrastructure's Subcommittee on Aviation 

Hearing on Review of FAA's Implementation of the FAA Modernization and Reform Act 

Thursday. May 16. 2013 

Second Set of Questions for the Record. May 24. 2013. for FAA Administrator Michael Huerta 

Frank A. loBiondo - New Jersey 2nd District 

Question: 

1. Mr. Huerta, last month we saw airline delays and cancellations nearly double due to your 

decision to furlough air traffic controllers. Despite repeated requests, you failed to provide this 

Subcommittee with the agency's plan for implementing the sequester cuts that led to the 

disruption of our National Airspace System for nearly a week last month. I assume you are 

already making plans to implement FY 2014 sequester cuts. Can you assure the committee that 

the agency will provide Congress and affected stakeholders a detailed impact analysis of 

controller furloughs, control tower closings, or any other sequester related budget cuts that will 

impact the National Airspace System in an appropriate timeframe? 

Answer: 

While the flexibility in the Reducing Flight Delays Act allowed the FAA to maintain its core safety 

functions, the reductions made to system modernization projects and airport improvement projects are 

unsustainable. Without additional congressional action, on October 1, FAA will again face the prospect 

of reductions to aviation services in order to achieve the long-term funding reductions called for in the 

Budget Control Act. The FAA will again be faced with making difficult choices in order to operate at this 

reduced funding level in FY 2014. Given the large percentage of the Operations budget devoted to 

payroll and the comparably small amount devoted to variable non-payroll costs, FAA will be forced to 

reduce compensation costs and make significant reductions to contracts. FAA will be unable to continue 

the same level of services to the flying public under a continued sequester in FY 2014 and we will make 

reductions to programs which will have the least impact to the largest number of flying passengers. 

That is why the FY 2014 President's Budget replaces the across the board spending cuts required by 

sequestration with a balanced approach to solving our Nation's budgetary challenges. 

Q!,Lestion: 

2. Section 213 directs the FAA to streamline the environmental review process and issue 

more categorical exclusions when a performance-based navigation procedure will result 

in a reduction in fuel consumption, carbon emissions and noise on an average per flight 

basis. What is the status of the FAA's implementation of Section 213(c)? 

Answer: 

There are two subsections under Section 213(c). Section 213(c)(1) provides a categorical exclusion for 

certain required navigation performance and area navigation procedures. The FAA has issued guidance 

for implementing this provision. Section 213(c)(2), referred to above, requires a determination of three 

measurable reductions-fuel consumption, carbon dioxide emissions, noise-on a per flight basis. The 

FAA has conducted an assessment of existing methodologies for determining noise and has to date not 

been able to identify a sound approach for making the noise determination on a per flight basis. In 

September 2012, the FAA asked the NextGen Advisory Committee (NAC) for assistance in further 

exploring how to make use of this categorical exclusion. The NAC is in the process of finalizing their work 
53 


Insert offset folio 40 here 80937A.040

for reporting back to the FAA. The timeline going forward depends on the outcome of the NAC work 

and FAA's assessment of their recommendation. 

Question: 

3. Mr. Huerta, the FAA has mandated that aircraft operators equip for ADS-B Out by 2020. 

What initiatives do you plan to undertake to effectively layout the business case for 

ADS-B In and other long-term NextGen programs to ensure sufficient buy-in by 

commercial airline and general aviation operators? 

Answer: 

The national deployment of ADS-B is steadily progressing and the FAA continues work on ADS-B 

procedures and applications for both Air Transport and General Aviation users that that will bring 

further near-term improvements to the NAS. To date, more than 550 radio stations have been installed 

throughout the NAS, of which 481 are currently operational. The operational radios are: 

Providing traffic and weather information to more than 1,400 properly equipped aircraft on the 

East Coast, West Coast, and in Alaska (ADS-B In) 

Supporting ATC separation services at 8 en route sites and 36 terminal sites (ADS-B Out) 

Supporting surface advisory services at 17 sites (ADS-B Out) 

National deployment of the ADS-B ground infrastructure will complete in FY2014. 

Air Transport Initiatives: 

The FAA is using Other Transaction Agreements (OTAs) to help expedite early adoption of ADS-B by air 

carriers. Through OTAs with industry partners, the agency is able to demonstrate real benefits of 

advanced ADS-B In applications and procedures while allowing the FAA to share costs and risks with the 

participants. The use of ADS-B In applications will give the agency and airlines detailed cost and benefit 

data, and encourage other airlines and operators to equip early to capitalize on ADS-B benefits. 

Any ADS-B-In application operational benefits validation activity requires at least one fleet operator to 

be willing to take the risk of being the "early adopter" to adequately exercise the application. Based on 

FAA's experience, this typically requires the Government to provide financial incentives via FAA funding 

of the Non-Recurring Engineering to develop and certify the initial ADS-B-In avionics and some number 

of these systems to reduce the operator's financial exposure. The FAA must also engage with resources 

in Air Traffic and Aviation Safety to ensure that controller and flight crew procedures are in place to 

enable operations. 

One example is the agency's partnership with United Airlines to demonstrate an ADS-B In-Trail 

Procedures application in the Oakland Oceanic Flight Information Region. An operational evaluation of 

this capability is ongoing. In May 2012, the FAA made the decision to fund the integration of In Trail 

Procedures into the automation system for use by air traffic controllers, which will be operational in 

2017. 

In addition, the agency plans to continue the evaluation and business case development of additional 

ADS-B In applications that were previously recommended by the user community through the ADS-B-In 

Aviation Rulemaking Committee (ARC). Based on ADS-B-In application research and feedback from the 
54 


Insert offset folio 41 here 80937A.041

ARC, the major near-term benefits from ADS-B-In will be generated by Interval Management 

applications'. 

Current FAA plans call for Initial Investment Decisions for changes to the automation systems to support 

Interval Management to occur by the end of FY14, with Final Investment Decisions to occur by midFY16. If these investment decisions are made on this schedule, then FAA would expect to be able to 

commence support of Interval Management operations by 2019-2020. Interval Management avionics 

should be available in the 2016-2019 timeframe. 

General Aviation Initiatives: 

For the general aviation community, an agreement was signed in 2007 with Alaska Aviation 

Organizations and Alaska Aircraft Operators for safety enhancements, aircraft equipage, and airport 

improvement in the State of Alaska. As an extension of this agreement, the FAA recently awarded a 

contract to FreeFlight Systems to upgrade the aircraft previously equipped (ADS-B Out and In) under the 

legacy Capstone program with rule-compliant DO-282B avionics. In addition, the FAA is working with 

the University of North Dakota through the Center for Excellence for General Aviation Research (CGAR) 

to develop and certify an ADS-B In Portable Electronic Device (PED) for use in helicopters. 

lastly, the FAA has been investing in the development of standards and prototype avionics for an ADS-B 

In application known as Traffic Situational Awareness with Alerts (TSAA). This application provides 

pilots of non-TCAS II equipped aircraft with enhanced traffic situation awareness in all classes and 

domains of airspace by providing timely alerts of qualified airborne traffic operating in their vicinity 

(alerts using voice annunciations and visual attention cues). The avionics standards for this application 

are scheduled to be completed in late 2013. 

Note that Sequestration funding cuts and other impacts are still being assessed and understood at the 

program level within FAA. 

Q.uestion: 

4. Mr. Huerta, the Administration has issued a series of regulatory reform executive orders. 

Among the common themes of these orders is the directive that the regulatory programs 

Of federal agencies should be less burdensome. Are you committed to assuring that future 

regulatory initiatives at FAA will be fact- and science-based, and can be justified on a 

cost-benefit basis, and do you plan to eliminate inefficient and costly rules that do not 

impact safety or the passenger experience? 

Answer: 

The FAA will continue to develop and implement Congressional mandates and rules required for safety, 

on a data-derived and cost effective basis. We will continue our efforts to eliminate rules that are no 

longer effective in meeting their safety purpose. 

I During Interval Management, the controller assigns the flight crew to manage a time/distance interval from the 

lead aircraft using ADS-8-tn capabilities. Having the controller give an instruction to maintain a specitic time or 

distance interval, as opposed to multiple tactical speed, altitude, or vector maneuvers should decrease controller 

workload and enable more accurate delivery of aircraft to the runway, with the net effect of reducing arrival delay. 
55 


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In response to Executive Order 13563, Improving Regulation and Regulatory, and Executive Order 

13610, Identifying and Reducing Regulatory Burdens, the FAA has identified 10 rules, 3 of which have 

been issued, through the Retrospective Regulatory Review (RRR) that would streamline the regulations. 
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Insert offset folio 43 here 80937A.043

Questions for FAA Administrator Michael Huerta 

The House Committee on Transportation and Infrastructure's Subcommittee on Aviation 

Thursday, Mav 16,2013 

Sam Graves - Missouri 6'h District 

FAA Reauthorization. Se(tion 816 - Historical Aircra/i Documents 

Administrator Huerta, could YOll please give me a status update on the implementation of Section 816 of 

the FAA Reauthorization Act, which deals with the preservation of Historical Aircraft Documents? 

The FAA is now developing internal guidance to facilitate responses to FOIA requests pursuant to 

Section 816 of Pub. L. 112-95, for Historical Aircraft Documents. The guidance will include a clear 

cxplanation of the meaning of the limitation that all sllch releases are subject to a " ... prohibition on use 

of the documents for commercial purposes." 

[FRs 

I am sure that you are aware of the TemporalY Flight Restrictions (TFRs) that currently exist over certain 

sports stadiums and theme parks. 

• Ifnot mandated to do so under current statute, would the FAA be inclined to issue similarTFRs 

for these theme parks and sports industries today if they received such a request from them? 

No. The current Disney and stadium NOTAMS are statutory mandates detailed in Section 352 of Public 

Law 108-7 and as amended by Section 521 of Public Law 108-199 and were issued to address security of 

the venues and the potential for a terrorist attack upon the facilities. The Disney properties do not meet 

the criteria for any of the TFR's available under 14 eFR part 91. Please note, however, that 14 eFR 

section 9l.l45, "Management of Aircraft Operations in the Vicinity of Aerial Demonstrations and Major 

Sporting Events", contain provisions for TFR's over some sporting events. These TFR's are issued if the 

FAA detcnnines that such action is needed for the management of aircraft operations and/or to prevent 

the congestion of aircraft in the vicinity. The rule is not intended to address security concerns nor would it 

be practical to issue a TFR for the hundreds of sporting events that take place around the country. 

• Would the FAA be inclined to support a legislative fix that would allow for air shows, taking 

place concurrently while sporting events are taking place and within the restricted airspace, to be 

granted an exemption to the TFRs'l 
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The Administration has not takcn a position on legislation. Should new legislation be dratled that 

amends the current legislation and contains specific recommendations, we will provide technical 

assistance if requested. 

Question: 

Living Histmy Flight Experience - Part 91 Exemption 

The Living History Flight Experiences (LHFE) is a FAA program authorized under Exemption No. 6802, 

which allows FAA approved organizations to carry passengers for compensation or hire for historical 

flight experiences. These operations include flights aboard our nation's most prestigious and well-known 

military aircratl, such as the P-51 Mustang. However, FAA modifications to Exemption No. 6802, 

specifically Condition 25 and Condition 29, will adversely affect the ability of these dedicated 

organizations to of Tel' truly historic flight experiences. 

For two decades, the LHFE program has allowed individuals to safely experience historical and vintage 

military aircraft in flight. The pilots and mechanics that fly and maintain these aircraft are often militarytrained or otherwise extremely capable of performing their job. This in-flight experience cannot be 

replicated in a classroom, observing a tlyover, or viewing a static display. 

Condition 25 prohibits the pilot in command (PIC) from "performing aerobaticflights while passengers 

are aboard the aircraft," and Condition 29 states that "No persons other than the assignedflight 

crewmembers may be permilted to manipulate the flight controls duringflight operations." 

Unfortunately, the FAA fails to recognize, or chooses to ignore, the fact that LHFE customers want to 

experience aerobatics in vintage aircraft and want to manipulate the controls under the supervision of the 

pilot. Prohibiting qualified organizations to provide this experience will seriously affect the viability of 

the LHFE industry and the ability to keep these aircraft flying for future generations to enjoy. 

What was the basis for or justification the FAA used in imposing Condition 25 and 29 to the 

LHFE program? 

• Would you give any consideration to removing those conditions'! 

The FAA must be able to ensure the safety of the pilot, passengers and the public during the conduct of 

aerobatics. These aircraft were not designed for aerobatics but for aerial combat. Many have performance 

characteristics that make aerobatics hazardous unless the pilot is familiar with the acrobatic limitations on 

the aircraft. In addition, these historic aircraft range from extensively restored to minimally airworthy. 

Other concerns include: 
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• Aircraft design limitations that may not be mitigated by civil operators; 

• Thc military set requirements for pilot training, proficiency, and currency to 

conduct combat flying, similar to acrobatic maneuvers, for many of these historic 

aircraft. The FAA only has pilot requirements for acrobatic flight at air shows; 

Degradation of the aircraft's original structural limitations (e.g., a 1955 aircraft should not 

be pushed to its limits); and 

• Inadequate inspection procedures because (a) basic maintenance and inspection 

requirements not met; and (b) continued operations beyond design limits (e.g., age, 

number of hours) were not contemplated. 

Restrictions on passenger manipulation of controls are based on the requirement for the LHFE holder to 

train and eheck any pilot who is flying a LHFE flight. The passenger has not been trained to serve as a 

crewmember and should not be manipulating the flight controls. [n some aircraft there may be timctions 

in the passenger cockpit that can jeopardize the safety of flight since the pilot would be unable to take 

corrective action. 

Navigational Charts 

It's my understanding that the FAA is the primary source for compiling the data that ends up on sectional 

charts or VFR charts. Additionally, I am aware that the FAA also prints these charts. 

Could you please tell me or provide this committee with the annual budget for this program 

including costs to produce, revenue generated, use of surplus funds from revenue generated, and 

the number of FAA personnel assigned to this process? 

The Federal Aviation Administration (FAA) has had the legislative authority to recover the cost 

of aeronautical charts and related products for over 13 years (Public Law 106-181, dated April 

5,2000, which was later codified in 49 USC Section 44721). Even as far back as 1926, when the 

Aeronautical Charting Program was under the Department of Commerce, the Program operated 

as a fee based Program. This legislation provides "The price of an aeronautical product sold to 

the public shall be not more than necessary to recover all costs attributable to: (i) data base 

management and processing; (ii) compilation; (iii) printing or other types of reproduction; and 

(iv) dissemination of the product." The current fcc structure is established to ensure the FAA 

realizes full allowable cost recovery in accordance with this legislative authority. 
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AeroNav Products cost for producing VFR Charts in FYl2 was approximately $16M. The 

actual revenue collected was approximately $7.6M, therefore, no surplus funds were received. 

The personnel assigned to the accomplishment of compiling, database management, printing and 

distributing VFR Charts represents approximately 71 Full-time Equivalent (FTE) personnel 

resources. 

I am additionally aware that after the FAA compiles this data, there appears to be a two week delay by 

FAA in releasing the tinalized chart data to private sector firms that also print sectional charts. This lag 

gives the FAA a two week head start, and as such, is an impediment to private sector printing capacity. 

Can you explain to me why this lag in providing data to the private sector is happening? 

Digital sectional charts arc available to customers via e-commerce and electronic dovmload as 

soon as they are compiled and printed, which is two weeks in advance of the chart effective date. 

The same Sectional charts are placed for free use for flight planning purposes on the FAA public 

web site 24 hours prior to the chart effective date. Any company desiring a two week advance 

version of the Sectional charts for use in reprinting, can purchase the digital Sectional product 

via e-commerce and electronic download. 

As currently the FAA performs this printing service for navigational charts, [ would like some more 

information as to why the FAA would engage in the business of producing these charts when there are 

commercially available producers in the private sector? 

Has a cost analysis been conducted by the FAA to determine ifsavings could be achieved by 

outsourcing production of these navigational charts to the private sector? If so, could you please 

provide me and the committee with this analysis? 

In the fall of2007, a High Performing Organization (HPO) Team composed of members from 

the FAA's Office of Enterprise Solutions (OES), National Aeronautical Charting Organization 

(NACO) - now known as Aeronautical Navigation (AeroNav) Products, and at that time 

NACO's parent organization, Aviation System Standards (A VN), began a comprehensive 

assessment of the organization, building on previous studies. The assessment included an 

evaluation of NACO's business model, workload analysis, and a benchmarking study of other, 

similar printing operations to identify best practices. 

Attached is a copy of the High Performing Organization White Paper, which includes the 

findings from the benchmarking studies. The White Paper established an implementation 

strategy, allowing the Printing Operation to remain in-house while achieving a more efficient 

level of operation. The HPO Plan was a five-year plan and will be successfully completed by 
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September 2013. Since thc baseline year of2007. the Printing Operation has achieved over a 

35% cost savings. 

Although the Printing Operations has achieved signiticant savings over the last 5 years, as the market 

moves toward reduced paper sales and as program requirements change, a program review and cost study 

is currently on-going with the intent for a decision for next steps to be made within the next 6 months. 

~Jion: 

If a cost savings could he achieved through outsourcing to the private sector, then would you not 

agree, given our current budgetary climate, that this would be preferable to reducing hours, 

closing towers, or enacting furloughs? 

At this time, we have no plans for outsourcing this function. 

Air Traffic Controllers Report 

Administrator Huerta, recognizing concerns for the quality of Air Traffic Controller training and attrition 

rates after finishing their entire training program at the academy and their facility, the committee directed 

you in the FAA Reform Act (specifically section 607) to report to us the graduation rates of FAA certified 

controllers with a Control Tower Operator Certification from an educational entity. It is my 

understanding that the FAA has not yet begun this study which would evaluate the effectiveness of hiring 

qualified controllers with a CTO certificate. 

• Can you please give me an update on this process? 

The FAA is well underway with the analysis required to complete this report as outlined in Section 607 of 

the FAA Refonn and Modernization Act of2012 (P.L 112-95). The report to Congress is due not latcr 

than two years from the enactment of P.L. 112-95. 

Information Technology 

In these challenging budget times, how does the FAA plan to use information technology as a 

way to drive cost savings? 

FAA will leverage technologies corporately, including cloud, collaboration, mobility, video conferencing, 

etc to drive cost savings across the agency. As we consolidate applications, FAA will have a greater 

focus on data and information to serve the agency's mission needs and requirements. 
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It is my understanding that the FAA is planning to consolidate and modernize a significant 

portion of the agency's IT systems. What is the planned process for conducting this 

consolidation? Please provide the committee with a timeline, including plans for any 

procurement of goods and services. 

FAA is consolidating 720 IT professionals into one IT organization. We are also creating agency-wide IT 

services (e.g. email, cloud, VTC, security, etc.). Through the consolidation, FAA will maintain a single 

applications inventory which will be used as a basis for eliminating redundant applications and/or 

redundant data sources. Consistent with the FY 2014 Budget request, we plan to stand up the new IT 

Shared Services organization effective October I, 2013. 

Will this consolidation also look to utilize new technology, including cloud computing, as a way 

to achieve cost savings? 

Yes, our consolidation efforts will look to utilize new technologies to achieve cost savings. FAA released 

a draft Screening Inlormation Request tor enterprise cloud services in April 2013. The estimated 

timeframe for contract award is FY 2015. FAA awarded a Softwarc-as-a-Service private cloud contract 

in May 2013 for email services. Implementation will be completed in Q4 FY 2013. FAA is planning to 

implement a mobile computing Bring Your Own Devi::e (BYOD) pilot in late FY 2013, allowing 

employees to use their personal devices to securely access the FAA network. 

When the FAA does move forward with procurements around the IT consolidation effort, how 

are you ensuring that the agency will perform a robust search to evaluate all possible solutions, 

including the latest in cloud computing0 

FAA anticipates awarding approximately five major contracts in support of IT services. These 

acquisitions will follow the FAA Acquisition Management System, conducting Market Surveys and 

soliciting marketplace information through Screening Information Requests. As an example, FAA's 

enterprise cloud services initiative released a draft SIR in April2014 seeking industry input on cloud 

services. 
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Can you ensure that these critical IT solutions will be obtained without any arbitrary limits or 

preferences placed around these procurements? 

Yes, FAA's acquisition policy prescribes that business needs, or requirements, be defined and that viable 

altematives be considered for meeting those needs. The Contracting Officer participates during 

acquisition process to ensure the acquisition is fairly administered and promotes competition. 

Agriculture Aviation 

In its attempts to integrate Unmanned Aircraft Systems (UAS) into the airspace, what is the FAA 

doing to ensure other, long-standing users of low-level airspace, such as aerial applicators, are 

protected from mid-air collisions and other operations that may prevent them from safely and 

effectively treating crops, protecting the public health, and conducting forest fires at low-levels? 

Authorized UAS operations currently fall into three categories 1) Public aircraft operations under a 

Certificate of Waiver or Authorization or 2) Civil aircraft authorized to fly in an experimental category 

and 3) Model aircraft. Currently, the FAA does not authorize commercial UAS operations for hire. 

Operators operating under category 1 or 2 must provide specific operating parameters, must identify risks 

posed by their operations and must have FAA-approved risk mitigation procedures in place. Among the 

risks that the FAA would expect to be identified in an application to conduct a UAS operation are the 

risks associated with conducting UAS operations in the vicinity of other long-standing users of low-level 

airspace, such as aerial applicators. In reviewing the application, the FAA would expect to see proposed 

risk mitigation procedures to protect those other users of low-level airspace from mid-air collisions and 

interference with operations such as treating crops, protecting the public health, and conducting tirefighting at low-levels. All UAS operations, regardless of category, including those that operate in lowlevel airspace, must comply with FAR 14 CFR Part 91.13, which states that "no person may operate an 

aircraft in a careless or reckless manner so as to endanger the life or property of another." Reported 

violations of FAR 14 CFR Part 91.13 are investigated by the FAA 

The aerial application industry consists of both turbine and piston engine aircraft that use Jet A and Avgas 

fuel, respectively. With the President's user-fee proposal it could potentially levy a fee on a turbine 

aircraft used to conduct aerial application activities by as much as $5,000-$6,000 a day since they take off 

and land frequently to treat farmer's crops. This is not something fair for farmers, aerial applicators or 

food consumers. 

Would the Administration include an exemption for all aerial application activities to user fees to 

prevent such a handicapping tax on a vital American industry and small businesses? 
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Aircraft conducting aerial application activities and that fly outside of controlled airspace, like those used 

in agricultural aviation, would not pay the proposed flight surcharge fee. The proposal would create a per 

flight fee by aviation operators who fly in controlled airspace only. 

Question: 

Has sequestration delayed the feasibility study FAA is conducting on the development of a 

database that would show the location of free-standing and guy-wired towers below 200 fcet? 

This was part of the FAA Reauthorization Bill that was enacted last year. 

No. the FAA has completed the analysis as directed in Section 219 of the P.L. 112-95. Our report 

is in final executive review and will be delivered to Congress in the near future. 

Question: 

• Will sequestration delay the publication of AC No.7017460-1, which includes new, important 

safety guidance on marking meteorological evaluation towers (METs) below 200 feetry The 

changes were published in the Federal Register the summer of2011, but the actual guidance 

document still has not been published. FAA has stated that it will be published this summer but 

will that be further delayed now? 

No. In consultation with industry representatives and the public, the FAA has provided guidance on 

voluntary marking of Meteorological Evaluation Towers (METs) erected in remote and rural areas that 

are less than 200 feet above ground level in order to increase the conspicuity of the towers for low level 

operations. These structures often fall under the threshold, specified in 14 Code of Federal Regulations 

(CFR), Aeronautics and Space, Part 77. Sqfe. Efficient Use, and Preservation of the Navigable Airspace, 

and are not subject to the notice requirements therefore do not trigger an aeronautical study by the FAA. 

In order to increase awareness of this voluntary guidance we are incorporating these recommendations 

into the next update of the Obstruction Marking and Lighting Advisory Circular (AC) 7017460-1. In 

addition to the voluntary guidance there are several other changes being incorporated into the update of 

this document. We have experienced some delay in getting this AC published due to the complexity of 

the issues surrounding some of the other updates. IIowcver, our goal is to have it published by the end of 

2013. It is important to note that the publication of this updated Advisory Circular does not impact the 

actual recommended guidance as it became final with the publication of the Federal Register notice. 
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Agricultural aviation interests have requested that the FAA expand AC No. 7017460-1 to include marking 

guidance not just for METs under 200 feet but for all towers-freestanding and guy-wired. 

• Will sequestration or any other FAA issues delay the Agency from considering this expansion of 

the AC? 

Requirements to file notice under 14 CFR Part 77 generally do not apply to structures at heights lower 

than 200 feet unless close 10 an airpOJ1 environment. METs under 200 feet do not meet the provisions of 

Part 77 and the FAA does not conduct aeronautical studies to determ ine whether these structures are 

obstructions or whether they adversely impact air navigation. However, the FAA acknowledged that 

METs in remote, rural agricultural areas may be difficult to see by low-level agricultural flights operating 

under visual flight rules. It was the combined factors of these structures being in rural, remote areas, the 

speed oftheir construction, and skeletal composition that led to additional, limited marking guidance. 

Guidance was not applicable to METs that are erected in urban areas and far removed from rural 

agricultural spraying operations. 

The request to expand marking guidance for structures other than METs is not based on safety of flight 

issues. The guidance used for METs is not fcasible or warranted for other structures under 200 feet. 

Other structures do not carry the same visibility concerns of skeletal METs, and additional marking 

guidance may cause an undue burden on the public. 

Washington, D.C. Metropolitan Area Special Flight R1!les Area 

The FAA Reauthorization bill required the FAA to submit to Congress a plan for the D.C. Metropolitan 

Area Special Flight Rules Area. The plan is to include specific changes that will decrease operational 

impacts and improve general aviation access to airports in the National Capital Region that are currently 

impacted by the zone. 

• What's the status of this plan which was due 6 months ago? 

Answer: 

The FAA has been working extensively with our other agency partners and the General Aviation 

community to improve access to airports in the National Capital Region. The plan is in final 

executive review in the FAA. A 60 day trial is scheduled to begin May 31, 2013. This trial will 

allow TSA-vetted general aviation pilots to conduct practice approaches and pattern work at 

Potomac Airfield, Washington Executive/Hyde Field and College Park Airpo11. 

Do you agree that more can be done to improve GA access in the DC area? 

Answer: 

The FAA is always looking at ways to improve access to airspace in the National Capital Area, 
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and continues to meet regularly and work with its interagency security partners and the general 

aviation community presenting proposals to expand general aviation access to the Washington, 

D.c', area. These proposals are subject to agreement by the National Capital Region interagency 

security partners. 

As you know, the FAA bill includes a provision on NextGen public private partnership and the 

establishment of an avionics incentive program for facilitating the acquisition and installation of 

equipment that is deemed to be in the interest of achieving NextGen capabilities in commercial and 

general aviation aircraft. 

Does the FAA have experience in public private partnerships? 

The agency has many agreements with private companies, airport authorities, and others. Most 

particularly, the agency is working with several air carriers to validate the business case for early adoption 

of NextGen avionics equipment. These efforts are governed by memorandums of agreement in which 

both the government and the air carriers contribute-a public private partnership. 

Additionally, the FAA has met with colleagues in the Department of Transportation regarding the 

Railroad Rehabilitation and Improvement Financing (RRIF) and Transportation Infrastructure Finance 

and Innovation Act (TIFIA) programs-two long-standing public private partnerships facilitating 

infrastructure financing. 

What is the status of the program? 

The agency continues evaluating and assessing feedback received from various stakeholders, researching 

previous pUblic-private partnerships, and assessing ways to reduce risk. The FAA held two public 

meetings, solicited stakeholder feedback via two market surveys, and held various one-on-one meetings 

with stakeholders. The FAA identified two avionics equipage bundles focused on operators: one for air 

carriers, flying in the busiest metroplexes, and one towards operators that fly elsewhere. 

Additionally, before the FAA issues any loan guarantees, consistent with the Federal Credit Refonn Act, 

additional authority in an appropriation is needed 

Question: 

Will you ensure that general aviation aircraft will not be left out of any incentive program? 
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Yes. 
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Federal Aviation Administration 

A White Paper on the 

National Aeronautical Charting Office 

(NACO) 

High Performing Organization (HPO) 

June 30, 2008 

Federal Aviation Administration 
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Federal Aviation Administration National Aeronautical omce 

< This page intentionally left blank> 

HPO White Paper 
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Federal Aviation Administration National Aeronautical Office 

EXECUTIVE SUMMARY 

The National Aeronautical Charting Office (NACO) is an organization within the Federal 

Aviation Administration (FAA) whose mission is to promote safe and efficient air travel by 

producing and disseminating aeronautical navigation charts and data to both public and private 

customers, In the spring of 2007, the FAA's leadcrship elected to pursue a High Performing 

Organization (HPO) designation for NACO as part of the FAA's Commercial Services 

Management program I and an alternative to a public-private competition, The main objectives of 

the HPO effort were to identify and realize savings from a more efficient organization, to 

increase performance and quality, to re-focus the organization on its core mission of 

disseminating aeronautical information, to rc-align NACO with the FAA's broader goals, and to 

prepare NACO to meet its long-term challenges, 

In the fall of 2007, an HPO Team composed of members from the FAA's Office of Enterprise 

Solutions (OES), NACO, and NACO's parent organization, Aviation System Standards (AVN), 

began a comprehensive assessment of the organization, building on previous studies, The 

assessment included an evaluation of NACO's business model, workload analysis, and a 

benchmarking study of other, similar printing operations to identify best practices, In addition, 

A VN established new Integrated Information Technology (IT) and Data Services Teams to focus 

on business process re-engineering (EPR) and integration opportunities as part of the HPO, 

Since its transition from the National Oceanic and Atmospheric Administration (NOAA) to the 

FAA in 2001, NACO had initiated several improvements to its business processes, However, the 

lIPO Team identified a number of key challenges still facing NACO as well as additional 

opportunities for improving the organization's efficiency and effectiveness, Despite 

technological advancements in cartography and printing, NACO continued to utilize costly and 

labor-intensive manual processes in its Aeronautical Charting and Reproduction Teams, 

NACO's chart agent distribution network numbered over 2,500 agents, many of which were not 

compliant with the sales provisions of their contractual agreements, In addition, although 

NACO's authorizing legislation allowed it to charge customers for its products and recover a 

significant portion of costs, NACO lacked a structured pricing methodology, NACO also lacked 

a strategy for responding to an expected long-term shift in demand from paper to digital 

products, Finally, the integration of database systems presented a significant opportunity to 

eliminate redundant work processes and ensure the consistency of source data by combining 

parallel activities within AVN, 

The HPO Core Team concluded its organizational assessment and adopted the following key 

recommendations for implementation of the NACO HPO: 

• Integrate AVN database systems to significantly improve operational efficiencies and ensure 

the use of consistent and quality data across AVN: 

• Establish International Organization for Standardization (ISO) quality objectives and metrics 

in the A VN Quality Management System to measure improvements in the quality of products 

and services; 

• Shift operational control for IT and Applications to the AVN Integrated IT and Data Services 

Team, The deployment of new systems and applications is critical to the success of the HPO, 

I In May 2008. the Competitive Sourcing initiative was superseded by a hroader program known as Commercial 

Services Management. 

HPO White Paper II 
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Federal Aviation Administration National Aeronautical Office 

Close collaboration and coordination is essential for the development of these highly 

specialized IT Applications. A VN' s IT Application support currently resides in Acquisition 

and Business Services; 

• Combine NACO with the National Flight Procedures Office (NFPO) and integrate data 

compilation activities and database systems to eliminate redundant processes and improve the 

quality of aeronautical navigation data; 

• Replace manual, paper-based cartography with computer-to-plate (CTP) technology and 

digital mapping to eliminate contracting costs, increase efficiency, and enhance the quality 

and precision of NACO's aeronautical products; 

• Reform the chart agent distribution model to reduce costs, increase efficiency, and promote ecommerce; 

• Institute a new pricing methodology for paper products that links prices to costs to producc 

charts, increasing and maximizing revenue collected as provided for in the authorizing 

legislation; 

• Establish a new discount structure for federal customers to increase NACO cost recovery, to 

increase customer accountability and to reduce waste; 

• Consolidate facility space in Glenn Dale, Maryland and turn over unused space to the General 

Services Administration (GSA); 

• Manage continuous improvement of the organization throughout and beyond the HPO time 

frame. 

The HPO Team projects savings to gradually increase along with implementation progress from 

around S2.8M during the first year (FY09) to an annual savings of approximately SIS.2M by 

FYI3 and beyond. This savings represents a 28% reduction from the COMPARE baseline cost 

estimate of S55.IM. In addition, the new pricing structure is expected to increase revenues by 

approximately $8.9M. The total yearly financial benefit (cost savings plus increased revenue) 

from implementation of all HPO initiatives is expected to reach close to S24M by FYI3. To 

ensure that the projected cost savings are realized by FY13, the initiatives must be implemented 

prior to the end ofFY12. Furthermore, an estimated implementation cost of $17.3M must be 

funded by FYII in order to realize the projected benefits by FY 13. The Core Team recommends 

the use of NACO's retained receipts to fund the implementation cost. 

As part of the integration of NACO and NFPO, the organization will assume new and increased 

work requirements during the HPO period. These new requirements will require an additional 47 

FTEs at a cost of around S5.7M annually. Due to NACO becoming an HPO, it is expected that 

the additional 84,020 annual labor hours will be met by shifting resources through the efficiency 

gains rather than increasing resources. 

In June 2008, the HPO Team began working with NACO and FAA leadership to develop an 

implementation plan for the HPO. To minimize the disruption to NACO's business processes, 

and considering the size of this implementation, full implementation of the NACO HPO is not 

expected to be completed until FY 13. Careful management of the transition will enable NACO 

to reduce staffing levels through attrition. 

In summary, the NACO HPO is projected to save the Federal Government a total of 

approximately $45.5M during the five-year HPO performance period (not including the 

increased revenues increasing NACO's receipts by an estimated $44M over five years), and an 

estimated SI5 .2M per year thereafter. The new organization will be better positioned to serve the 

HPO White Paper iii 
71 


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Federal Aviation Administration National Aeronautical 

needs of the FAA and meet future challenges. As an HPO, NACO will remain focused on 

safety, while delivering higher quality aeronauticalllavigation products and service to its 

customers in the aviation community. 

HPO While Paper iv 

Office 
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Administration National Aeronautical Office 

< This page intentionally left blank> 

lIPa White Papcr v 
73 


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Federal Aviation Administration National Aeronautica! Office 

SECTION 1: RATIONALE FOR BUSINESS PROCESS REENGINEERING 

(BPR)I PURSUIT OF A HIGH PERFORMING ORGANIZATION (HPO) .............. 8 

1.1 Background ............................................................................................................................... 8 

1.2 Rationale and Benefits ................................................................................................................ 8 

SECTION 2: DESCRIPTION OF CURRENT ORGANIZATION ..................... 10 

2.1 Overview of NACO Operations ................................................................................................ 10 

2.2 Current Products and Services Offered and Customers Served ............................................... 10 

2.3 Current Funding and Expenditures ........................................................................................... 13 

2.4 FY07 Organizational Chart and Staffing ................................................................................... 17 

2.5 Identified Challenges ................................................................................................................. 18 

SECTION 3: DESCRIPTION OF ENVISIONED ORGANIZATION ............... 22 

3.1 Work Processes and Performance Improvements ..................................................................... 22 

3.2 Organizational Chart and StatTing ............................................................................................ 42 

3.3 Business Model and Strategy .................................................................................................... 43 

SECTION 4: EXPECTED SA VINGS, PERFORMANCE TRACKING AND 

CONTROL, IMPLEMENTATION, AND CONTINUOUS IMPROVEMENT ....... 50 

4.1 

4.2 

4.3 

4.4 

Expected Savings/Financial Impact and Costs ............ . ..................................................... 50 

Performance Tracking and Control ........................................................................................... 51 

HPO Implementation ................................................................................................................. 52 

Continuous Improvement Management Plan ............................................................................ 53 

SECTIONS: MILESTONES ................................................................................... 56 

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SECTION 1: RATIONALE FOR BUSINESS PROCESS 

REENGINEERING (BPR)! PURSUIT OF A HIGH PERFORMING 

ORGANIZATION (HPO) 

1.1 Background 

Office 

In December 2005, the Federal Aviation Administration (FAA) Administrator directed the Office 

of Enterprise Solutions (OES), which is part of the Air Traffic Organization's Finance Service 

Unit, to analyze the functions performed by the National Aeronautical Charting Office (NACO). 

The analysis included an examination of the functions and services performed by NACO, the 

costs associated with these functions and services, and the revenue generated through the sale of 

NACO products to the public. 

The assessment of NACO uncovered potential areas for improvement and in August 2006, OES 

presented a series of near-, mid- and long-term recommendations to the Administrator. Under the 

Administrator's direction, OES began implementing the near and mid-term recommendations in 

September 2006. Due to the success of the implementation efforts and the potential for 

substantial and sustainable long-term cost savings, FAA leadership determined in the spring of 

2007 that NACO was a suitable candidate for the High Performing Organization (HPO) 

designation. OES was charged with the development of an HPO business case. Since July 2007, 

OES has been extending the original assessment of NACO to include a more refined look at the 

NACO business model, an assessment of NACO processes and activities, and the calculation of 

NACO baseline costs. 

In the fall of 2007, the FAA leadership appointed an HPO Core Team consisting of Aviation 

System Standards (A VN), NACO, and OES members to begin assessing the current state of 

NACO through cost analysis, workload analysis, examination of the existing business model, 

best practices benchmarking and analysis of current processes. The team planned to finalize the 

assessment of the current state and the design of a future, more cost effective organization by the 

end of FY08. 

1.2 Rationale and Benefits 

The rationale for NACO's pursuit of a High Performing Organization is the desire to realize 

tangible and sustainable benefits, such as cost and performance improvements, while meeting the 

goals of the President's Management Agenda (PMA). The rationale and benefits of achieving 

HPO status include: 

• Lack of Suitable Private Sector Competitors - Market research determined there were too few 

responsible available competitors due to the highly specialized nature of the work. 

• Address Human Capital Issues and Secure Future for NACO - The NACO HPO provides a 

framework for the proactive management of operational challenges including obsolete 

technology and retirement/attrition of staff. 

• Increased Efficiencies Efficiency improvements will allow NACO to better utilize limited 

resources. increase performance, and meet the needs of future workload increases. 

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Federal Aviation Administration National Aeronautical 

• Savings and Peiformance Improvements As an HPO, NACO can yield savings and 

performance improvements comparable to public-private competition, but with lower 

implementation costs and less disruption to the workforce. 

• Recognition of Accomplishments - As FAA's first HPO, NACO would be recognized for 

efficiency gains and model business practices. 

Ornee 

• Commercial Services Managemen/ Credit - Receiving the HPO designation will provide the 

Department of Transportation (DOT), the FAA and NACO with credit in meeting PMA 

objectives. 

'In May 2008. the Competitive Sourcing initiative was superseded by a broader program known as Commercial 

Services ~lanagemcnt. 

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SECTION 2: DESCRIPTION OF CURRENT ORGANIZATION 

2.1 Overview of NACO Operations 

In 2000, NACO was transferred from the National Oceanic and Atmospheric Administration 

(NOAA) to the FAA by the Wendell H. Ford Aviation Investment and Reform Act for the 21 st 

Century. NACO's function and mission is to compile, print, and distribute aeronautical 

navigation charts, data, and related publications 3 In addition, NACO supports the global 

aviation community by supplying other countries with aeronautical chart products and 

participating in national and international aeronautical committees. Involvement in these 

committees and with the International Civil Aviation Organization (ICAO) helps set the strategic 

direction and U.S. position for the standardization of international aeronautical charts and flight 

information products. In addition, NACO provides chart seminars and participates in community 

outreach programs to support aviation safety. 

2.2 Current Products and Services Offered and Customers Served 

2.2.1 Products and Services Offered 

NACO offers an array of products and services to the aviation community, the U.S. Department 

of Defense (DoD), internal FAA customers, and to other government agencies. 

2.2.1.1 Aeronautical Charts 

NACO compiles, prints, and distributes paper and digital aeronautical charts. These charts are 

reproduced and distributed to the FAA, the military and to the commercial and general aviation 

communities through direct sales (by telephone, fax, and e-commerce), retail outlets (chart 

agents), and intergovernmental requests. NACO aeronautical charting products include: 

• Visual Flight Rules (VFR) charts 

• AirportlFacitity Directory (AfFD) and other flight supplements 

• Instrument Approach Procedures (IAP) charts 

• Instrument Departure and Arrival charts 

• Instrument Flight Rules (lFR) High and Low Altitude Enroute charts 

• Controller charts 

• Controller Radar Video Maps (RVMs) and Minimum Vectoring Altitude (MVA) data 

Figure 2.1 illustrates the production process for aeronautical charting product. 

:t Definition of compile: creation of new charts, processing and updating of information on charts including removal 

of obsolete information, and the collection and addition of data to the charts. 

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Federal Administration National Aeronautical Office 

...... --------------

I I --------,1 I 

I 

Aeronautical 

I,n'onnalmn Sub· Team 

Visual Chart Sub- ! Team I 

Enroute 

NaVigation SubTeam 

Instrument 

Approach 

Procedures (lAP) 

Sub-Team 

II 

II 

I I Services Provided to Other Government Charting 

I '- _ _ _ _ Functions 

I r------, r------, 

II I I 

II I J 

I I Reproduction I I 

Team I!! 

---.I I I 

II 

, , 

I J 

II 

I I 

I I 

I I 

I I 

, I 

II 

Enroute Only 

Printing 

Contractors 

Distribution Team 

No 

Stand;n~ I, 

Subscriptions I Yej 

I 

Chart Agents 

Gov'tEntites 

Public 

I 

I 

I 

I 

II 

II 

II 

II 

II 

II 

II Distnbutlon 

I I 

L _____ Customers J _ 

Figure 2.1: NACO Process Flow - Aeronautical and Nautical Charts 

22.1.1.1 Visual Flight Rule (VFR) Charts 

NACO is the only producer of original U.S. VFR charts. which are updated every six or twelve 

months (with the exception of Helicopter Route Charts. Special Charts and some isolated area 

Alaskan charts). VFR charts are updated using data from a variety of sources including the 

National Flight Data Digest (NFDD). the Weekly Obstruction List. UK Geological Survey 

(USGS) topography maps, road atlases. railroad maps, county/state bighway maps, aerial 

photography, flight edit updates, airspace dockets, U.S. Coast Guard Marine Light lists and input 

from map users. 

The compilation of aeronautical data for VFR charts is currently a manual process. Modifications 

are done by hand and verified by cartographers before VFR charts are sent to the Reproduction 

Team for printing. The handwritten changes to the VFR charts are then added to the printing 

negatives by negative engravers using computer cartography. Once all the changes are complcte, 

the negatives are used to create printing plates. Once printing and other finishing processes are 

complete the VFR charts are transferred to the Distribution Team for storage and distribution to 

customers. 

2.2.1.1.2 Instrument Flight Procedure (IFP) Charts 

The Instrument Approach Procedures (lAP) Sub-Team produces lAP, Arrival, and Departure 

procedure charts. IFR charts are compiled using data from the National Flight Procedures Office 

(NFPO), National Flight Data Center (NFDC) and other FAA sources. Compilation of each IFP 

chart is a semi-automated process utilizing computer-aided design (CAD) as opposed to a fully 

automated database dri ven process. 

After IFP charts are updated, the CAD files are converted to Portable Document Format (PDF) 

files and sent directly to the printing contractor (the Reproduction Team docs not handle IFP 

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charts). The contractor fills subscription and chart agents' standing orders before sending the 

remaining inventory to the Distribution Team for storage and further distribution in response to 

future sales. 

2.2.1.1.3 Enroutc Charts 

Approximately 75% of Enroute charts are purchased by the Department of Defense (DoD) with 

the public accounting for the remaining 25% of charts produced. These charts are updated 

digitally and changes are sent directly from the NACO Aeronautical Chart Team to the printing 

contractor. As of FY08, the Reproduction Team does not handle Enroute changes. The contractor 

fills standing orders and subscription sales before sending the remaining inventory to the 

Distribution Team. 

2.2.1.2 Digital Data Products 

NACO provides aeronautical information in digital form to NACO charting Sub-Teams, the 

aviation community and to FAA Air Traffic Control, NFDC and DoD. Digital products include: 

• Radar Video Maps (RVMs) These digital maps, including Minimum Vectoring Altitude 

Maps (MV A), are provided to 410 Air Traffic Control facilities. NACO maintains over 7,000 

map files and must provide the information in five data formats due to lack of standardization 

at A TC facilities. 

• Minimum Safe Altitude Waming System (MSA W) - This system is maintained in accordance 

with FAA orders and provides controllers with the information they need to warn pilots of 

terrain or obstruction hazards. NACO maintains 323 MSA W sites and provides updates to 

FAA and DoD through the Internet. 

• Digital Obstacle File (DOF) - The DOF contains all reported man-made obstructions for 29 

different structure types within the U.S. and in areas of the Caribbean, Mexico, Canada and 

the Pacific. Weekly DOF updates are sent to DoD and FAA offices while the 56-day DOF is 

available by subscription to government agencies and the aviation community. 

• National Flight Database (NJc1) - The NFD contains information to support Enroute and 

Terminal GPS navigation including: information on instrument procedures, airspace, airways, 

fixes, navigational aids (NA VAIDs) and airports. Information can be provided directly to a 

pilot or the Flight Management System of an aircraft. The FAA Enroute Automation 

Modernization (ERAM) Program is currently evaluating the NFD for use as source 

aeronautical data in future ERAM releases. 

• Digital Terminal Procedures Publication (dTPP) - This DVD product contains all U.s. IFPs 

and airport diagrams that are contained in the printed TPP volumes. The dTPP product is 

updated every 28 days. 

• NA V AID Digital Data File This file provides a current listing of NA V AIDs in the U.S., 

Puerto Rico, and the Virgin Islands and select locations in Canada, Mexico, the Atlantic and 

Pacific. This file is updated every 56 days. 

• Digital Aeronautical Chart Supplement (DACS) - This CD provides digital airspace data not 

otherwise available. The DACS is primarily an Air Traffic Control (ATC) data product, bnt is 

also provided to the general public. DACS is updated every 56 days. 

• Digital Aeronautical Information compact disc (CD) (DAICD) - This CD contains the DACS, 

the DOF and the NA V AID Digital Data File. 

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• Sectional Raster Aeronautical Chart (SRAC) product - This three set DVD product contains 

Geo-referenced digital VFR charts for the U.S. including Alaska, Hawaii and Puerto Rico. 

The SRAC is updated every 28 days. 

2.2.1.3 Other Products 

NACO produces the AirportlFacility Directory (AlFD) which contains airport data including 

information on NA VAlDs, communications data, weather resources, special notices, and hours 

of operation, lighting codes, VFR waypoints and runway data. The directory also contains airport 

diagrams and sketches. NACO also produces a Pacific and Alaska Supplement Publication. 

In addition, NACO produces the Aeronautical Chart Users Guide, which is a VFRlIPR teaching 

aid, a reference document, and an introduction to the wealth of information provided on FAA's 

aeronautical charts and publications. It includes explanations of chart terms and symbols, and a 

comprehensive display of aeronautical charting symbols organized by chart type. 

2.2.1.4 Services Offered 

In addition to producing its own products, NACO provides printing and distribution services to 

other government agencies. In PY07, NACO printed USGS maps4, printed and distributed 

NOAA nautical charts, and distributed DoD aeronautical and nautical charts. 

2,2.2 Customers Served 

NACO serves both the general public (via direct sales and chart agents) and the government. 

Table 2.1 shows a breakdown in the number of paper charts sold to each customer in FY 2007. 

Table 2.1: Breakdown of Customers Served 

Percent of Total Charts 

Customer Charts Purchased Purchased 

Public - Direct Sales 1,251,796 11.5% 

Public - Chart Agent Sales 3,031.669 27.9'70 

DoD 5,515,304 50.7% 

FAA' 753,246 6.9% 

Other Government 324,640 3.0'70 

2.3 Current Funding and Expenditures 

2.3,1 Funding 

2.3.1.1 Operations 

NACO receives operations funding through its parent organization. A VN. When NACO was 

transferred to the FAA in 2000, AVN initially funded the Personnel Compensation & Benefits 

(PC&B) expenses for all of NACO's employees. In FY03, AVN and NACO agreed that NACO 

would fund PC&B expenses for 24 FTEs from its retained receipts account, thus reducing the 

amount of operations funding received from A VN. As shown in Figure I, A VN funded 270 of 

NACO's 294 FTEs in PY07, which amounted to $27.4M in operations funding. NACO applied 

$0.95M from the retained receipts account to cover PC&B expenses for the remaining FI'Es. The 

, As of FYOS. NACO no longer prints USGS maps. 

, At present, FAA receives charts from NACO at no cost. 

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Air Traffic Organization (A TO) provided NACO with an additional $2.3M in operations funding 

in exchange for the production of RVMs. 

FY07 

Retained Receipts FAA Funding 

Funding 

Brought In 

_ ....• TT •..• 'I $54,812,646 

I'CI"'''''OFTB~ Exp.n~ituresi {$55,l'6$,O71l. 

._._ J 

Figure 2.2: FY07 NACO Funding and Retained Receipts Flow 

Since the allocation from A VN covers PC&B for only 270 FfEs, charges from the OPS account 

must bc transferred to the retained receipts account to fund the remaining FfEs. 

2.3.1.2 Retained Receipts 

The retained receipts account contains the proceeds from the sale of NACO, DoD and NOAA 

maps to the public (via direct sales or through chart. agents) and other Government agencies 6 

Retained receipts are used to fund PC&B not covered by operations funding and all other 

expenditures including printing and distribution contracts and supplies. Starting in FY06, this 

account funded capital improvements. The balance of funds in the retained receipts account is 

carried over from year to year. 

In FY07, NACO generated $19.3M in revenue. Total obligations in FY07 exceeded total 

appropriated funds and revenue from the sale of aeronautical products. The difference between 

the amount received from sales and appropriated funds and the total amount of obligations was 

funded from the remaining balance of the retaincd receipts account. Figure 2.2 above illustrates 

the drawdown of the retained receipts balance in FY07. At the beginning of FY07 the balance of 

the retained receipts account was SI8.7M. During that year, $952,425 was withdrawn to cover 

" Regarding DoD and NOAA charts. NACO is only authorized to recover the cost of producing and distributing 

DOD and NOAA charts; proceeds above and beyond those costs must be returned to Treasury. 

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Administration National Aeronautical Office 

the remaining obligations. The balance at the end of FY07 was 517.8M. In the future, NACO 

will continue to use retained receipts to fund modernization eff0l1s. 

2.3.2 Expenditnres 

Table 2.2 shows NACO actual expenditures for FY07 (excluding expenditures for United States 

Postal Services (USPS) mailings). Building expenditures of 55,066,500 are based on the cost of 

the Silver Spring and Glenn Dale facilities (but is shown separate from Rent, Communications 

and Utilities since it is paid directly to GSA by ATO). 

Table 2.3 provides an overview of the services and supplies for which NACO has contracts. 

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2.4 FY07 Organizational Chart and Stafiing 

National Aeronautical Charting Office 

Terry Laydon, Manager n r 

~~~~~~~~~~~G=====::;::========~; I Safety~)ec,a"st I 

Program & Production Mgmt. Staff I I Requirements and Technology Team 

(9) (9) 

I ~--------------~ 

Management Team & Staff (1) f---- Management Team & Staff (1) 

Fmancia! and Resource Management (3) 

L.....-.-..- Contract Mangement, Program Coordination (5) 

~ Marketing/Advanced Technology (7) 

I..........-Product Evaluation and Development (1) 

Visual Chart Sub-Team 

(45) 

Enroute Navigation Sub-Team 

(35) 

2.4.1 Program and Production Management Team 

The Program and Production Management Team: 

• Manages NACO Human Resource functions 

• Provides financial management 

• Determines procurement requirements 

• Coordinates and processes personnel actions 

• Manages property and facilities 

• Monitors and reviews contracts 

• Evaluates production capacities 

• Coordinates special projects and requests 

• Coordinates and monitors interagency agreements 

• Determines basis for chart and product pricing 

2.4.2 Requirements and Technology Team 

The Requirements and Technology Team: 

Distribution Team 

(31) 

Inventory Management & Quality 

Assurance, AgentlGov't and Public 

Sales & Services 

(26) 

• Provides organizational technical guidance and long range planning 

• Establishes and validates NACO charting requirements 

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National Aeronautical Office 

• Coordinates product development and/or enhancements 

• Performs product evaluation functions 

• Represents NACO on government and industry aviation standards and advisory 

committees and working groups 

• Manages Marketing Program 

• Conducts pilot seminars on chart use and symbols 

• Manages the NACO Internet site 

2.4.3 Aeronautical Chart Team 

The Aeronautical Chart Team: 

• Supports the NACO mission directly by converting, validating and compiling aeronautical 

data received from a variety of sources 

• Produces VFR and IFR charts and maintains aeronautical charting databases using 

val ida ted data 

• Provides cartographic support to FAA Air Traffic Service 

• Produce a wide range of hardcopy and digital products to general aviation and military 

pilots and to FAA facilities including: VFR charts, IFR charts, the AlFD, controller charts, 

RVM and NFD 

2.4.4 Reproduction Team 

The Reproduction Team: 

• Provides pre-press work including negative engraving and photo servicing 

• Prints and finishes VFR, USGS and NOAA nautical charts (as of FY08, NACO no longer 

supports USGS products) 

2.4.5 Distribution Team 

The Distribution Team: 

• Oversees warehouse and shipping contractors 

• Maintains product sales accounting and payment collections 

• Manages direct to public charts sales (one-time and subscription) and sales to chart agents, 

DoD and other government agencies 

• Determines print quantity levels 

• Approves and monitors authorized chart agents 

2.5 Identified Challenges 

2.5.1 NACO and A VN Integration 

Since alTiving at the FAA from NOAA in 2000, NACO's processes and systems have not been 

optimally integrated with those of its parent organization, AVN. To address these integration 

issues, Integrated Information Technology (IT) and Data Services Teams (Integrated Teams) 

were established to focus on opportunities that would increase NACO's integration with its 

parent organization A VN and improve data services throughout the A VN organization. 

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2.5.2 Product Pricing 

2.5.2.1 Structure 

National Aeronautical Office 

During the original assessment of the NACO organization, OES found that NACO's prices had 

not been adjusted since the organization was transferred from NOAA to the FAA in October 

2000. At the time of the assessment, prices remained at the level set by NOAA authority prior to 

FYOl. While a part of NOAA. NACO had adjusted prices regularly based on the products' unit 

costs. Since its transfer to the FAA in 2000, however, NACO no longer had a system in place to 

calculate and analyze unit costs. In FY07, NACO increased the prices for all of its products by 

an average of 8% as a short-term measure to keep pace with rising costs. 

Following the original assessment, the OES team worked closely with the FAA's legal counsel 

to determine which costs could be recovered through product pricing under NACO's authorizing 

legislation (Public Law 106-181). On the basis of the legal interpretation, OES collaborated with 

NACO and A VN staff to develop a methodology for collecting cost data and classifying costs as 

recoverable or non-recoverable for each product. The OES team then began the development of a 

pricing model that would yield updated product prices that maximize the recovery of allowable 

costs, in accordance with the legislation. Table 2.4 shows NACO's total revenue and costs for 

FY07. NACO's revenue fell short of the costs it was allowed to recover in FY07 by 

approximately $14M (recoverable production costs minus total receipts). 

2.5.2.2 Discount Rates 

NACO offers a range of discounts by customer group, product, and type of order. Table 2.5 

summarizes the discounts offered to major customer groups. 

Table 2.5: NACO Product Discounts 

Individual on-time sales & subscriptions 0% 

Chart agents 40% 

Federal Aviation Administration lOO% (frec) 

Department of Defense Ran.!!cs from l7% to 90% (avera JC of 86%) 

Libraries. schools, & scientific institutions 10% 

Members of Congress ._~.~ .. ___ -... ----.-1-- 100 free charts. full price after 100 

Other g~~_menl agcnc,,>jc='s'--_-cc.,---,----o-o-,,--_-f ___ ._. ____ . ___________ 4:::O:c"'"'-!o 

~nal Archives, Depository Libraries, & Library 

of Congress 

2.5.2.2.1 DoD Discounts 

100% (free) 

NACO offers multiple discount rates to DoD. Not only do DoD's discounts vary by product, 

NACO also offers DoD a lower set of discounts for unscheduled orders than for scheduled 

(advance) orders to reflect higher costs. Consequently, DoD received discounts ranging from 

16% to 90% in FY07, with an average weighted discount of slightly more than 86%. Just as for 

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Federal Aviation Administration National Aeronautical 

the prices offered to NACO's other customcrs, the prices offered to 000 were not changed 

between October 2000 and the start of FY07. 

2.5.2.2.2 Chart Agent Discounts 

Oftlce 

NACO sells its products at a 40% discount to approximately 2,500 aeronautical and nautical 

chart agents, who resell them to retail customers at no more than NACO's full prices. In the 

retail industry, offering a standard discount to product vendors is common practice. The NACO 

discount rate has varied over time but has not been changed in approximately 30 years. 

2.5.3 Product Sales 

In FY07, NACO received approximately $19.34M in revenue from the sale of approximately II 

million NACO paper and digital products. The majority of NACO products were purchased by 

chart agents and 000. These customer groups also received the largest discounts (with the 

exception of the FAA), which significantly reduced the proportion of costs recovered through 

product sales (these customers purchase a large proportion of NACO products, but generate a 

smaller proportion of total revenue). 

2.5.3.1 Returns 

NACO allows chart agents to return all unsold expired charts within 60 days of the expiration 

date for a full refund to their chart agent accounts. As part of the agreement that chart agents sign 

with NACO, agents must keep their return rate below 20% or face cancellation. Accounts are 

reviewed annually to identify vendors with return rates exceeding 20%. In December 2006, 

letters were sent to agents that were not compliant with the 20% ceiling on returns. Enforcement 

of this policy was subsequently reviewed, as some chart agents remained non-compliant. In 

FY07, NACO's chart agents returned a total of 848,541 items with a total sales value of 

$2,584,664. Nearly 50% of chart agents had return rates above 20%, with the total weighted 

average return rate equaling approximately 24% in FY07. The average return rate for those 

agents above the 20% limit equals 39.8%. 

2.5.3.2 Condemnation of Expired Charts 

The production level for each NACO product is based on historical sales figures. Aeronautical 

products not sold before their expiration date are kept within the distribution facility and 

discarded ("condemned") to ensure that obsolete aeronautical information is not made available 

to the public. [n FY07, 266,455 aeronautical products including visual charts, digital products, 

Enroute charts and books were produced but not sold. This represented a condemnation rate of 

about 3%. 

2.5.4 Digital Product Sales 

NACO is not currently able to protect its products from unauthorized reproduction. NACO's 

digital products are widely shared and can be obtained from unauthorized third party sources at 

little or no cost. As demand for digital products increases and paper sales decline, it is likely that 

NACO will have difficulty in sustaining a revenue stream from additional digital product saJes. 

If NACO were to expand its digital product offering. without copyright protection, to meet 

changing technology and customer needs, it is possible that NACO would experience a decline 

in retained receipts as revenue from the sale of digital products may not compensate NACO for 

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Federal Aviation Administration National Aeronautical Office 

the decrease in the sale of paper products. If NACO is not able to secure copyright protection, 

other strategies for maintaining this revenue stream will have to be ex.amined. If NACO is not' 

able to maintain this revenue stream, it will experience a decrease in retained receipts and 

become more dependent on operations funding. 

2.5.5 Workforce Retirements/Shortage 

Like many federal agencies, NACO faces the challenge of an aging workforce. Approximately 

30% of NACO's employees will be eligible to retire by FYI3. Without proper assessment and 

planning. NACO could face a staffing shortage or staffing misalignment in the next several 

years. Figure 2.3 depicts the number of staff eligible for retirement by the FY13. 

120 

100 

" " " '" 0 80 

a. 

E 

w 

:0 "60 :~ 

iii 

(5 

a; 

.Q 40 E 

=> 

Z 

20 

Pre-FYOB 

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FY08 FY09 rYl0 

Year 

FY11 

Figure 2.3: NACO Staff Eligible for Retirement 

21 

FY12 FY13 
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National Aeronautical Office 

SECTION 3: DESCRIPTION OF ENVISIONED ORGANIZATION 

3.1 Work Processes and Perfonnance Improvements 

In addition to the analyses performed by the NACO HPO Team, A VN established Integrated IT 

and Data Services Teams to identify business process re-engineering opportunities across A VN. 

The teams analyzed current processes and evaluated their alignment with the mission, vision, and 

goals of the FAA and ATO. Based on these assessments, they developed recommendations for 

new business processes and a new organizational stmcture that will significantly improve the 

efficiency of the organization and its ability to fulfill its mission within A VN. 

This section describes the envisioned organization based on the assessments of the HPO Team 

and Integrated Teams. It is divided into the following three sections: 

• A VN Integration - Although A VN Integration touches all parts of NACO, this section 

mainly describes changes to the Aeronautical Chrut Team, the Program and Production 

Management Team, and the Requirements and Technology Team. 

• Reproduction Team - This section describes all process improvements recommended for 

the Reproduction Team. It includes some changes recommended by the A VN Integrated 

Teams but is separated for clarity. 

• Distribution Team - This section describes the process and staffing changes in the 

envisioned organization. Changes to the chrut agent model are described in Section 3.3.2. 

3.1.1 A VN Integration 

3.1.1.1 AVN Gold Standard National Flif?ht Data (NFD) Implementation 

The A VN "Gold Standard" is an integrated process that will ensure that the data used for the 

design and development of Instmment Flight Procedures (IFPs) and the associated coded Flight 

Management System (FMS) data is the same data that is flight inspected, provided for rule 

making, and published in the NFD. The Gold Standard process will improve the quality and 

safety of the NFD by ensuring the consistency and integrity of the data throughout the IFP 

process. The implementation of the Gold Standard will also result in significant cost savings. 

In the current process, a commercial contractor provides coded NFD terminal procedures data to 

NACO employees, who assure the quality of the data. The current contract, which includes the 

maintenance of RNAVs, SIDs, and STARs, costs $700K annually and requires 4,500 in-house 

staff hours for quality assurance. Expanding the current process to include all [FPs (which is 

planned with the Gold Standard Process) would cost an estimated additional $500K in contract 

costs alone. The Gold Standard process will expand the use of IT tools funded through the 

Instrument Flight Procedures Automation (IFPA) Capital Investment Plan (CIP AI41 across 

A VN. In the new process, the NFD will be maintained from data that is generated using 

established business rules from a database system that has been quality assured as part of the 

procedure development and flight inspection processes. See Attachment I in Appendix for visual 

depictions of the current process and the A VN Gold Standard NFD re-engineered process. 

Implementation of the Gold Standard Process is already under way, and is nearly complete for 

RNA V IFPs. To monitor quality improvements with the Gold Standard process, International 

Organization for Standardization (ISO) quality objectives are being added to the A VN IFP 

Quality Management System and mctrics arc being established to measure performance against 

these quality objectives. 

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Implementation Cost for Initiative: In order to realize this significant annual benefit, as shown 

in the table above, by FYI3, the implementation cost of this initiative must be funded prior to the 

close of FYIl. 

3.1.1.2 Enroute Chart Automation 

NACO currently uses an outdated manual compilation process that relies on contractor support 

to produce Enroute products. Automating the Enroute production process will improve the 

accuracy and quality of Enroute products, eliminate the need for contracted compilation support, 

and reduce labor costs. 

The current process for Enroute charting is paper-based and incorporates an extensive amount of 

manual compilation. Cartographers manually review and apply changes in writing to paper 

standards. These standards are sent to a contractor who applies the changes and prints the charts. 

Phase one of this initiative includes creating digital Enroute charts using CAD software. This 

will enable NACO to compile and maintain the files digitally and provide updates directly to the 

Reproduction Team. Maintaining these charts digitally will allow NACO to rely on its own 

resources instead of the current drafting contractor used to maintain the standards. The 

Reproduction Team will not have to create negatives to support Enroute charting. 

The second phase will consist of the creation of a centralized geo-referenced database. which 

will allow NACO to replace and update multiple production processes. Once this is 

accomplished. there will no longer be a need for individual databases and individual data 

maintenance tools. With a central geo-database and a common set of GIS tools, NACO will be 

able to more easily adapt to new requirements, products and services, and a more demanding 

digital cllstomer. 

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The current workload is accomplished by a team of 17 cartographers that maintain the entire 

Enroute series of charts. Phase one will allow NACO to use in-house resources instead of a 

drafting contractor, reducing Reproduction Team labor hours and material costs. Once databasedriven chart technology has been fully implemented, the same workload will be accomplished 

with only 10 cartographers, realizing a 41 % savings in labor hours. See Attachment 2 in the 

Appendix for a visual depiction of the Enroute Chart Automation re-engineered process (current 

and "to-be" workflow). 

Implementation Cost for Initiative: To ensure the cost efficiency benefit of this initiative is 

realized by FY 13, the implementation cost of this initiative must be funded prior to the close of 

FYI!. 

3.1.1.3 Airport/Facility Directory Automation 

As in the production of Enroute charts, the current process for maintaining and producing the 

Airport/Facility Directories (AIFD) and supplement products requires extensive manual 

compilation and contractor support. Automation of the A/FD will utilize commercial off-theshelf (COTS) software tools to strcamline the process, improving quality. reducing in-house 

labor costs, and eliminating the need for contractor support. 

The current process for maintaining the NFD and supplements involves extensive data review 

and manual drafting. Aeronautical Information Specialists manually review source data and 

apply changes in writing to paper standards or manuscripts. These standards are sent to a 

production contractor that makes all the changes for the next edition of the publication. The 

current process is not only inefficient, but can lead to multiple errors. Consequently, this process 

requires additionallcvels of quality assurance. The fe-engineered process will use proven COTS 

tools to extract data from the FAA's databases and send completed electronic files to the 

contractor for printing. See Attachment :l in the Appendix for a visual depiction of the reengineered process for the A/FD and supplement products (current and "to-be" workflow). 

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Implementation Cost for Initiative: To begin to realize the annual cost savings benefit as 

shown in the table above, by FY 13, implementation of this initiative must be funded no later than 

FYI!. 

3.1.1.4 Common Airport Mapping Initiative (CAM!) 

The Common Airport Mapping Initiative (CAMl) will combine separate airport mapping 

activities in NACO into a single team. improving the quality of several products and reducing 

labor costs. Subsequently transitioning to COTS Geographic Information System (GlS)-based 

technology will provide NACO with the capability to support new FAA requirements for airport 

mapping products. 

Three of NACO's sub-teams currently perform duplicate airport mapping activities in support of 

separate NACO products. The Instrument Approach Procedures Sub-Team produces airport 

diagrams and airport sketches using separate production processes to support the Terminal 

Procedures Publication. The Aeronautical Information Sub-Team produces airport sketches in 

support of the AlFD. The Visual ChaIt Sub-Team produces airpoIt patterns to support visual 

chart products. This organizational structure results in considerable duplication of effoIt in the 

evaluation and application of airport inspection and survey data and the quality assurance of the 

separate products. Even with strict quality assurance processes in each sub-team, inconsistencies 

in critical airpOIt data still occur. 

The CAMI will improve quality and result in considerable efficiency gains by eliminating 

duplicative processes (see benefits table 3.7). Using GIS-based technology, a common graphic 

will be used to generate various airpOIt map products. This will improve product quality by 

providing consistency in airpOIt data across all chart products. CAMI will also support the 

creation of ncw products for usc in modern cockpit display systems. These new products would 

meet existing requirements and directly support thc FAA's goal of reducing runway incursions 

and improving safety. See Attachment 4 in the Appendix for a visual depiction of the Common 

Airport Mapping re-engineered process (current and "to-be" workflow). 

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Implementation Cost for Initiative: To begin to realize the annual cost savings benefit as 

shown in the table above, by FY13, implementation of this initiative must be funded no laterthan 

FYI!. 

3.1.1.5 Integrated AVN Production Tracking Systems 

The integration of the Procedure Tracking System (PTS) and Consolidated Production Control 

System (CPCS) processes will eliminate redundant databases and data entry procedures, 

resulting in considerable efficiency gains and improving data quality. 

PTS is a centralized database for tracking and managing all IFP projects and tasks. Service area 

Flight Procedures Offices (FPOs) currcntly enter data for these projects and tasks into PTS, 

which tracks them from development through quality assurance, flight inspection, and charting. 

When the projects and tasks reach the charting stage, NACO's Charting Team manually enters 

the project data into the CPCS, which is used to track production, cross-reference data, and 

assemble the chart data for reproduction. By integrating PTS and CPCS, the IFP data will be 

transferred electronically from the PTS to the CPCS, eliminating manual data entry and resulting 

in a faster processing time and greater data accuracy. See Attachment 5 in the Appendix for a 

visual depiction of the AVN PTS Integration re-engineered process (current and "to-be" 

workflow). 

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Implementation Cost for Initiative: To begin to realize the annual cost savings benefit as 

shown in the table above, by FYI3, implementation of this initiative must be funded no later than 

FYI!. 

3,},J,6 Digital Topographic Maps across AVN 

Replacing NACO's manual obstacle plotting procedures with digital processes will reduce the 

labor hours required for chart production, increase the accuracy of obstacle data, and enable 

cross-referencing of data with other digital datasets, 

NACO currently uses paper quadrangles for plotting obstacle information, extracting elevation 

data, obtaining city shapes, and charting cultural and physical features, Using paper quadrangles 

for these activities requires labor-intensive manual manipulation and physical storage space, The 

USGS Digital Raster Graphics (DRGs) are electronic topographical maps that can be 

manipulated using a graphical software application, By replacing paper quadrangles with DRGs, 

NACO will eliminate the need to maintain physical quadrangles and enable cartographers to plot 

and update obstacle data in digital files. DRGs are maintained electronically and can be replaced 

as new DRGs become available, eliminating the nced for physical storage space. DRGs are also 

geo-referenced, which makes plotting easier and more accurate and will allow cross-referencing 

with other digital graphics. See Attachment 6 in the Appendix for a visual depiction of 

implementing the use of digital topographic maps across AVN (current and "to-be" workflow), 

Implementation Cost for Initiative: To begin to realize the annual cost savings benefit as 

shown in the table above. by FYI3, implementation of this initiative must be funded no later than 

FYll. 

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3.1.1.7 AVN Database Integration 

As a data-driven organization, NACO's long-term success depends on the reliability and 

capacity of thc tcchnology it uses. In the context of comprehensive organizational change, 

NACO will undertake a database integration and system upgrade initiative that will strengthen 

the organization by eliminating redundant processes and replacing antiquated IT infrastructure 

with modern systems that are more reliable, easier to operate, have greater functionality, and are 

compatible with the agency's IT architecture. The AVN Database Integration initiative will 

improve the production processes and the overall quality of products that rely on the following 

source data: 

• Obstacle Data 

• Airport Data 

• NA V AID Data 

• FixfWaypoint Data 

• Military Training Route (MTR) Data 

• Preferred, Terminal Enroute Control (TEC), and North American Route (NAR) Data 

• Airspace Data 

• Standard Instrument Departures (SID) and Standard Arrival (STAR) Data 

The replacement of the Civilian Airspace Route System (CARS) is a key component of this 

initiative. CARS is critical to the creation of the DACS and the NavInfo file, which are included 

on the DAICD. It is also used to generate reports and files in support of NACO charting. CARS 

is a legacy system that runs on an unsupported VAX 4300 server. The system's antiquated 

COBOL programming makes troubleshooting extremely time consuming, imposes limitations on 

integrity checks needed for quality assurance, reduces the precision of data output, and requires 

frequent system maintenance. A new version of CARS would utilize data maintained by A VN 

for airports, NA YArDs, fixes, airways, SrDs, and STARs as the source for DACS. 

The second component of the A VN Integration initiative is the consolidation and enhancement 

of redundant database systems maintained by NACO and NFPO. NACO currently relies on 

National Airspace System Resources (NASR)lNFDD, NavCanada, and the National GeospatialIntelligence Agency (DoD) for the airport and runway data used to create charts, publications, 

and digital products. The National Flight Procedures Office uses similar sources to maintain the 

AIRNA VIA VNIS, obstacle, and airspace fix databases in support of night inspection and night 

procedures development. Consolidation of these databases will eliminate redundant data 

collection and allow A VN to fOCllS efforts on the integrity of fewer data sets. Modernization of 

these databases to meet AVN requirements is already underway. Once completed, system's 

enhanced capabilities will yield significant labor savings and its automated integrity checks will 

provide an additional layer of quality assurance. The upgrade will also streamline NACO's 

procedures for tracking charting updates. Completion of this modernization initiative is 

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scheduled for 2009. See Attachments 7 thru 14 in the Appendix for a visual depiction ofthcsc rcengineered processes (current and "to-be" workl1ow). System enhancements that will automate 

and streamline the compilation ofMTR, Enroute, airspace, SID and STAR data will result in 

higher data quality and additional labor savings. 

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A VN Database 

Integration- NA V AID 

Data 

A VN Database 

Integration - NA V AID 

Radar Data 

A VN Database 

Integration - TEe and 

NARData 

A VN Database 

Integration Airspace 

Data 

A VN Database 

Integration - SID, 

STAR Data 

A VN Database 

National Aeronautical Office 

168 42% 

280 60% 

Summary ofImplementation Cost for AVN Database Integration Initiative: Table 3.14 

summarizes the implementation cost for the eight sub-initiatives, whicb fall under the category of 

A VN Database Integration. The cost reflects an estimated one-time cost, which will ensure the 

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implementation of the recommended initiative, in order to realize the total annual benefits 

identified in Table 3.13. To begin to realize the annual cost savings benefits by FYI3, 

implementation of this initiative must be funded no later than FYI\' 

3.1.1.8 VFR Digital to Plate 

Office 

NACO currently relies on labor-intensive manual compilation, contractor drafting support, and 

the use of film negatives to create VFR products. Automation of the VFR production process 

will improve the precision and quality of visual products, eliminate the need for contracted 

drafting support, enable NACO to sustain operations as older technology becomes obsolete, and 

reduce costs from labor and materials. 

The current process for visual chart compilation requires NACO's cartographers to review and 

apply changes to paper standards by hand. The standards arc then sent to a drafting contractor. 

who compiles the changes and prepares the next edition of each publication. When ready, the 

Charting Team sends the standards to NACO's Reproduction Team for the creation of single-line 

film negatives. Automation of the VFR production process will enable NACO's Visual Chart 

Sub-Team to compile visual charts digitally and provide them directly to the Reproduction 

Team, eliminating the need for contractor support. The use of digital files will also eliminate the 

negative engraving processes and the need for film, which has become scarce due to innovation 

in printing technology. See Attachment 15 in the Appendix for a visual depiction of VFR Digital 

to Plate re-engineered process (current and "to-be" workflow). 

Implementation Cost for Initiative: To begin to realize the annual cost savings benefit as 

shown in the table above. by FY 13, implementation of this initiative must be funded no later than 

FYI\' 

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T bl 3 16 HPO VFR D' . 't I I PI I I . If C isS 

Software 

Software Development/ Labor/ 

Inilialhe Hardware Procuremenl Conversion Contract Training Tolal 

VFR Dl Ital to Plate $25,000 $ 0,000 $20,( 00 

3.1.1.9 Standardized Use of Sectional Aeronautical Chart (SRAC) AVN· Wide 

NACO currently produces data tiles for the Instrument Approach Procedures Automation 

(lAP A) system using a specialized process that requires the creation of a custom color proof. The 

paper used to create the proof is no longer manufactured and is in limited supply. However, 

NACO already produces the Sectional Raster Aeronautical Chart (SRAC), a product for public 

sale that is very similar to the tinal files used for IAPA. By processing the SRAC for use in the 

current lAP A/future Instrument Procedures Design System (IPDS) system, NACO will realize 

savings in labor hours for processing and reproduction as well as materials and conserve its 

supply of scarce materials. See Attachment 16 in the Appendix for a visual depiction of the use 

of SRAC re-engineered process (current and "to-be" workflow). 

Implementation Cost for Initiative: Benetits from this initiative can be realized without any 

initial investment in the implementation of the new re-engineered process. 

3.1.2 Reproduction 

3.1.2.1 Pre·Press Process 

The pre-press function can achieve signiticant savings over a five year time frame through its 

transition from a manual film production process to a digital/Computer-to-Plate (CTP) process. 

Currently, a large portion of production is associated with manual film processes with an BPO 

plan to transition to all digital/CTP processes within two to three years. NACO has already 

started to systematically transition their pre-press production to digital/CTP, with the expectation 

that all pre-press production will be digital/CTP by FY 11. In doing so, NACO will reap 

significant savings in both labor and material costs. Furthermore, NACO will realize several 

benefits to the quality and consistency of their products. 

Computer-lo-plate is an imaging technology used in modem printing processes. This technology 

allows an image that's created in a desktop publishing application to be output directly onto a 

printing plate. Among the many advantages of CTP, other than cost savings, include improved 

imagc quality, registration, and consistency, as well as increased productivity. 

Going digital while utilizing CTP technology will effectively eliminate all manual processes in 

the pre-press production process (reducing process cycle time) accounting for approximately 

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11,000 annual process hours (see Table 3.18). The negative engraving process cycle time (PCT) 

will be effectively reduced by 23%, the Photo lmaging PCT reduced by 79%, and the 

Lithography PCT by 62% when the transition is complete (for a total pre-press PCT reduction of 

35%). Table 3.18 summarizes the projected processing time reductions throughout the HPO 

performance period. 

3.1.2.2 Press/Printing Process 

As part of the HPO effort, the HPO Team conducted a benchmarking study to identify best 

practices in the printing industry. The team observed press operations at two peer organizations, 

Jeppesen, a commercial producer and distributor of aeronautical charts, and the Department of 

the Treasury's Bureau of Engraving and Printing (BEP), and collected data on presses from 

Williams & Heintz, a commercial printer that specializes in maps. Press specifications for each 

organization arc included in Attachment 17 in the Appendix. 

NACO's press equipment consists of two five-color sheet-fed offset presses and one two-color 

sheet-fed offset press. Among the equipment for which data was collected, NACO's presses arc 

the oldest and have the lowest level of automation. Consequently, NACO's presses require more 

pressmen to operate and have a lower printing capacity than those included in the study. 

Refurbishment or replacement of NACO's presses would entail significant expenditures. 

Therefore, in light of the expected long-term decline in demand for paper products, the HPO 

Team does not recommend additional capital investment. 

The optimal staffing level for press operation depends on a combination of factors related to the 

workload, the characteristics of the products, the number of presses, and the type of presses used. 

In regard to the type of presses, the level of automation is a critical overarching feature in 

determining the staffing requirements. While NACO's presses compare unfavorably to the 

presses of peer organizations in terms of press speed, paper size, the number of safety features, 

and level of automation, the HPO Team concluded that the efficiency of NACO's press staffing 

could be improved. NACO employed more pressmen per press than any of the peer 

organizations, in some cases more than twice as many. The HPO Team has determined the 

following as the optimal stamng level while maintaining safety standards in the press area: 

• Reduce the number of full-time press operators of both five-color presses from five to four 

with one rotating alternate press operator to assist with adjustments, fill in for absent press 

operators, and provide floor support. 

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• Decommission the two-color press. Transfer work currently performed on the two-color 

press to the five-color presses. Eliminate two press operator positions for the two-color 

press. 

Table 3.19 shows the baseline vs. the HPO press area staffing. 

T bl 319 B r HPOP A aStaffi 

Description Baseline HPO FTE Comments 

FTE 

2-Color Harris Press 2 0 Press will no longer be used 

5-Color Harris Press # I 4 Reduced by 20% 

5-Color Harris Press #2 5 4 Reduced by 20% 

~B=ac~k~u~pP~re~s~sm~en~ ______ -+ ____ ~O ____ ~ ____ ~I ____ t7B~a~ck~-~uLp~a=dd~e~d~ _______________ ____ 

Supervisor I I No changes 

Refer to Table 3.21 for the projected reduction in press area FTE's over the entire HPO 

performance period. 

3.1.2.3 Quality Assurance Process 

The baseline staffing for the quality assurance (QA) function includes a total of four (4) FTEs. 

Based on the elimination of USGS workload and more efficient QA practices, it has been 

determined that the QA function's most efficient staffing level is two (2) FTEs. Table 3.21 

shows the projected reduction in QA staff over the entire HPO performance period. 

3.1.2.4 Finishing Process 

The baseline staffing for the finishing function includes a total of seven (7) FTEs working on one 

cutting machine and two folding machines. The staffing in this area is based on the minimum 

staffing required to operate the machines safely. The capacity of the machines dictates the 

operational efficiency regardless of staffing. Based on scheduling and minimum staffing required 

for the machines, the appropriate staffing level is five (5) f<iEs (reducing tbe staff by 2 FTEs) 

operating the three pieces of equipment. Table 3.21 shows the projected reduction in FrE's over 

the entire HPO performance period. 

3.1.2.5 Maintenance Process 

The baseline staff-hours required for the maintenance function is approximately 4,687 hours. 

These hours include maintenance duties in negative engraving, photo imaging, lithography, press 

area, finishing, and Environmental Occupation Safety and Health (EOSI-l) commitments. In 

conjunction with NACO's transition to all digital/CTP processes, an approximate 25% reduction 

in the maintenance hours from the baseline requirement is anticipated. This digital transition will 

enable the maintenance group to achieve an optimal staffing level of two (2) FTEs by FYlO. 

Table 3.20 summarizes the approximate change in maintenance workload hours from the 

baseline to the HPO. 

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3.1.2.6 Management and Support Processes 

The baseline staffing level for the management and support ofthe Reproduction Team was nine 

(9) FIEs. Due to the Reproduction Team's overall improvement in work processes, reduction in 

staffing to the most efficient levels, and work consolidation/reassignment, the appropriate 

management support staff level in the NACO HPO will be five (5) FTEs (a reduction of 4 FTEs). 

A projected timcline of this reduction is shown in Table 3.21. 

3.1.2.7 Staffing Plan 

Based on the reduced process cycle times and an analysis of the work requirements over the 

HPO performance period, NACO's HPO will be able to reduce the total FIEs by 33 (a net 47% 

reduction from the baseline). This will yield a savings of approximately $3.4M annually (60% 

cost reduction) once the transition to the new stafting plan is complete (targeted for FYII). Table 

3.21 summarizes the l<lE requirements and savings over the HPO five-year performance period 

in each of the reproduction processes. For a detailed staffing plan by position over the 

performance period, refer to Attachment 18 in the Appendix. 

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3.1.2.8 Materials and Equipment Savings 

In addition to the process cycle time reduction from CTP, the digital technology will allow for 

savings in the maintenance of pre-press equipment and material/supply costs. Total projected 

HPO annual savings in maintenance and material/supply costs of approximately $430,000 by 

FY 11 as summarized in Table 3.22: 

3.1.2.9 HPO implementation Costs for Reproduction 

The transition from manual pre-press processing to the use of CTP technology will require the 

purchase of an additional CTP machine by FY to to support NACO's current transition schedule. 

At an estimated cost of 5300,000, NACO is expected to recover the investment in less than one 

year through maintenance contract and materials savings directly attributable to CTP, as shown 

in Table 3.22. 

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3.1.3 Distribution 

3.1.3.1 Inventory Management and Quality Assurance (IMQA) 

The baseline slaffing for IMQA consists of a total of five (5) ~IEs. This includes four (4) 

Inventory Specialists and one (1) Team Leader. IMQA is responsible for managing the 

warehouse inventory for FAA aero, 000 aero, 000 nautical and NOAA nautical, and 

forecasting print quantities for FAA aero and NOAA nautical products. There are currently two 

(2) Inventory Specialists responsible for 000 aero and 000 nautical products, along with other 

FAA products. With the elimination of 000 aero and 000 nautical products in FYlO, IMQA 

will have a decrease in workload resulting in a reduction in staff by one (1) ~IE, leaving a total 

of four (4) ~TEs in FYI!. Refer to Table 3.23 for the projected reduction in ~TEs over the entire 

IIPO perfornlance period. 

3.1.3.2 Agents/Government Sales and Services Sub-Team 

The Agents/Government Sales and Services Sub-Team is responsible for the all aspects of the 

product ordering process, including setting up chart agent or Government agency accounts, 

processing orders, and collecting payments. The baseline staffing for the Agents/Government 

Sales and Services Sub-Team is 12 FTEs. There are 10 sales representatives in the group-seven 

(7) in charge of chart agent accounts and three (3) in charge of government agency accounts. 

As ofFY07, NACO's chart agent network is comprised of approximately 500 nautical and 2,000 

aeronautical chart agents located throughout the U.S., as well as in a number of other countries. 

As part of this HPO, a new chart agent model, which will reduce a number of agents, is 

described in Section 3.3.2. Implementing these recommendations will allow the 

Agents/Government Sales and Services Sub-Team to reduce by seven (7) FTEs, yielding an 

average annual savings of $440,000 by FY II. Table 3.23 in the Staffing Plan section shows the 

projected reduction in FTEs over the entire HPO performance period. For more information 

regarding the proposed chart agent model. refer to 3.3.2. 

3.1.3.3 Public Sales and Services Sub-Team 

Streamlining the ordering process towards utilizing e-commerce will reduce the time intensive 

ordering options such as phone. email and fax orders. This will increase efficiency for public 

sales representatives to process orders and decrease their workload. This decrease workload will 

result in a projected reduction of three (3) FTEs in the Public Sales and Services Sub-Team by 

FY II. Table 3.23 in the Staffing Plan section shows the projected reduction in ~TEs over the 

entire HPO performance period. 

3.1.3.4 Distribution Team Support Staff 

The Distribution Team support staff consists of management and support staff for all functions of 

the Distribution Team. The baseline staffing for the Distribution Team is a total of seven (7) 

FTEs. This includes one (l) Distribution Analyst Supervisor, two (2) Distribution Analysts, one 

(1) Financial Analyst, one (l) Management & Program Analyst, one (l) Logistics Management 

Supervisor and one (1) Traffic Management Specialist. Since the baseline period, one of the 

Distribution Analysts left the team and the position was not backfilled. With the reductions in the 

other groups. the Distribution Team will be able to reduce staffing by one (I) FTE (Distribution 

Analysis) for a total of six (6) FTEs and will continue with the current staffing level through 

FYII. The reorganization of NACO and NFPO into the National Aeronautical Information 

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Service (NAIS) is planned within FY09fFYIO time frame (see Section 3.2.3), eliminating 

duplicative staff positions. Therefore it is estimated that two (2) of the administrative positions 

will be eliminated after the reorganization to NAIS by FY 13, which brings the original 

Distribution Team support staff to three (3) PTEs. Table 3.23 in the Staffing Plan section shows 

the projected reduction in PTEs over the entire BPO performance period. 

3.1.3.5 Staffing Plan 

Based on the proposed chart agent model, the requirement that chart agents use e-commerce for 

placing orders, and the anticipated increase of online orders from the public, NACO will be able 

to reduce the Distribution Team staff by 14 PTEs within the BPO performance period. This 

equates to a 39% reduction in staff and a savings of $1 ,094,323 over the five-year period, which 

is a 43% cost savings from the baseline. Table 3.23 summarizes the FrE requirements and 

savings over the BPO five-year performance period in eaeh of the Distribution processes. For a 

detailed staffing plan by position over the performance period, refer to Attachment 19 in the 

Appendix. 

3,l.4 New and Increased Work Requirements 

Beginning in FY09 and continuing beyond FY13, NACOfAVN will be able to meet documented 

growth in existing work, as well as, meeting requirements for new products and services. 

Furthermore, this additional and significant increased workload will be met without increasing 

existing resources. The annual labor hour savings described in Section 3.1.1, A VN Integration, 

will be re-directed towards the new and increased workload requirements. Without the BPO 

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labor hour savings, NACO would need to increase staff by a substantial amount, subsequently 

increasing its operating cost. The following describes the new and increased work requirements. 

3.1.4.1 Enroute Automation Modernization (ERAM) 

The ERAM Development Contractor (Lockheed Martin) has specified that Enroute aeronautical 

data be provided in an industry standard ARINC 424 data format for support of the ERAM 

system. The A VN produced NFD product is in this format, but additional 

enhancements/additions are required for the NFD to meet the ERAM requirements for 

international data for Mexico, Canada, the Caribbean, Pacific, and Atlantic. In order to 

accomplish this additional workload, resources will need to be shifted to this activity (see Table 

3.24 for level of effort). Although not included as part of the NACO HPO savings benefit, this 

NACO initiative will result in a considerable cost savings to the FAA ERAM Program Office. 

This agency savings is based on eliminating the ERAM Program Office having to procure the 

data from commercially available data sources at a very high cost of over $850K annually. The 

additional annual workload requirements to be funded within the A VN program are shown in 

Table 3.24. 

3.1.4.2 Common Airport Mapping Initiative (CAM!) 

There is a critical need to reduce runway incursion accidents and incidents, and this target has 

been reflected in FAA Flight Plan Goals for a number of years. One of the key cornerstones to 

reducing runway incursions is for aircraft crews to have up-to-date airport surface movement 

diagrams/maps to use while taxiing in low visibility, low light, or unfamiliar conditions. For 

optimum safety, these surface movement diagrams should also be provided in an electronic 

display showing the aircraft's position on highly accurate airport surface diagrams. Creation of 

such necded digital detailed airport surface movement charts is a significant safety benefit, and 

will provide the airport surface information necessary to directly support high level FAA Flight 

Plan Goals for reduction of runway incursions. The additional annual workload requirements to 

be funded within the A VN program are shown in Table 3.25. 

3.1.4.3 Obstacle Repository System (ORS) 

Within the FAA there is a critical need for comprehensive obstacle data to support instrument 

procedure design, charting, and air traffic control required MSA Wand MV A production. 

Although different, all of these products are dependent on a comprehensive obstacle information 

source. Within A VN there are currently two different obstacle databases, which contain (with 

some overlap) obstacles of interest for specific production needs. In addition, there is a 

significant backlog of obstacle accuracy determinations for obstacles, which impact procedure 

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design and also have charting impact. In order to meet A VN production requirements in an 

efficient manner, A VN needs to integrate obstaclc databases, resolve conniets bctween internal 

obstacle databases, and make progress on resolving the current growing back-log of existing 

unverified obstacles that impact instrument procedure design and charting. The additional annual 

workload requirements to be funded within the AVN program are shown in Table 3.26. 

3.1.4.4 New Aeronautical Chart Products 

Due to changes to the NAS and as the result of new FAA charting rcquirements there will 

continue to be a need to develop new aeronautical chart products to support both air traffic 

operations and U.S. aviation needs. Some recent examples of new charting requirements include 

the development and support of FAA IFR Enroute charts to replace 000 canceled charts of the 

Caribbean, Pacific and Atlantic areas, development of new VFR Terminal Area Charts, and 

development of new off-shore IFR charts to support efforts such as the West Atlantic Route 

System (WATRS). These on-going chart development requirements will continue to demand 

NACO support in the future. Thc additional annual workload requirements to be funded within 

the AVN program are shown in Table 3.27. 

Table 3.27: Additional Annual Workload from New Aeronautical Charts 

3.1.4.5 Radar Video Maps (RVM) 

Production of RVMs is critical for supporting Terminal Air Traffic operations. The production of 

RVMs, which is funded by ATO-T, has been expanding for many years. The increase in the 

number of RVMs produced each year is attributed to the introduction of Performance-Based 

Navigation (PBN) terminal procedures into the NAS, as well as the deployment of new Air 

Traflie Control (ATC) systems to high impact airports (e.g., STARs), and the shifting of older 

A TC systems to smaller airports not previously serviced by radar. NACO has been tracking the 

number of RVMs produced for many years, and based on this historical data they have projected 

that the workload will increase by about 300 RVMs a year for the next 5 years. NACO's 

projection is substantiated by planned increases in FAA Flight Plan goals for PBN terminal 

procedures over the next several years. The additional annual workload requirements to be 

funded outside the A VN program through separate Ops Funding are shown in Table 3.28. 

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3.1.4.6 Increase in New and Amended Instrument Flight Procedures and NOll-Procedures 

Revisions 

Due to the growth in the aviation industry, National Airspace System (NAS) traffic is expected 

to continue increasing over the next 20 years, increasing the risk of flight delays, schedule 

disruptions, choke points, and inefficient flight operations, particularly when inclement weather 

and other factors impact airport capacity. 

Through NextGen, the FAA is addressing the impact of traffic growth by increasing NAS 

capacity and efJiciency while simultaneously improving safety, environmental impacts and user 

access to the NAS. The FAA is implementing new routes and procedures that leverage emerging 

aircraft navigation capabilities. 

In support of increasing the capacity of the NAS and the Agency's NextGen initiative, the 

Agency is requesting to increase the current production rate of Performance-Based Navigation 

[FPs (i.e., Required Navigation Performance - RNP, Wide Area Augmentation SystemW AAS) as early as 2008 and is expected to continue expanding at an increasing rate over the 

next 20 years. 

After the publication of the IFP, A VN is responsible for life-span maintenance of the procedure. 

An IFP must be continually maintained until it is cancelled. IFP amendments are an integral part 

of the continual maintenance activity. Amendments or revisions are issued based on various 

changes, which occur after an IFP is published. Examples are user/customer request changes, 

criteria changes, new obstacle constructions, airport infrastructure changes, magnetic variation 

changes, and navigational aid facility relocations. 

As IFP production increases and inventory continues to expand, the number of required 

amendments will increase at an equivalent rate. Historically, the NFPO has accumulated a large 

backlog of IFP maintenance workload. As the IFP development and revision process is 

automated, this backlog will be accomplished by increasing the current rate of production to be 

worked by NACO. 

Based on a historical trend on the increase of non-procedural revisions over the last several 

years, a 12% increase is expected for at least the next 20 years. Factors that playa role in the 

need to make a non-procedural change to a chart product are as follows: any change at an airport; 

a communication type of change; airport construction; or an enhancement to a communication 

system; etc. 

With the efficiency gains realized from the process re-engineering activities identified in this 

document, this additional workload can be accomplished without any additional staffing, thus 

creating a cost avoidance as shown in Table 3.29. 

Table 3,29: Additional Annual Workload from IFP and Non-IFP Revisions 

FY 13 and Beyond Requirements Annual Labor Annual Cost of New 

Hours Workload 

Increase m On mal IFP 'W orkload 

Increase in IFP Amendment Workload 

Increase in Non~Proccdural Revision Workload 

Total 

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3.2 Organizational Chart and Staffing 

3.2.1 NACO / NFPO Process Integration 

The NACO HPO will merge with the NFPO by FYlO, ereating a new organizational structure. 

This new structure will be an integral part of the implementation of the A VN Integration 

Initiatives described in Section 3.1.1. Business process re-engineering efforts supported by 

developing and planning for new information technologies will facilitate the integration of most 

activities within NACO and NFPO. Sophisticated IT systems with built in business rules will 

require staff in both organizations to have a common set of higher IT and aeronautical 

information skills. and less manually-oriented specialized cartographic and procedures 

development skills. Through this initiative, the number of FTEs in these organizations will be 

reduced. The resulting integrated organization will reduce costs, increase production capacity, 

and improve quality. Integration will also result in shorter delivery times to customers, and lower 

unit costs for products and services. The NACO HPO and NFPO combination will occur in two 

phases. 

3.2.2 Phase One - HPO Organization Chart and Staffing 

Phase one of the HPO will occur in FY09. This phase of the integration effort will combine all 

IT planning, data services, and digital product planning and development into a single Integrated 

IT and Data Services Team (refer to Attachment 20 in the Appendix for the Phase I 'to be" 

organizational chart). This organizational structure will support all IT planning and development 

necessary to support this HPO Plan. It will ensure that A VN systems and processes are properly 

integrated and designed consistent with the NAS IT Enterprise Architecture and future 

FAAIATO data stewardship/federated database model requirements. This organizational 

structure is also necessary to support many of the re-engineered processes presented in the HPO 

Plan, which eliminate duplicate data maintenance work/processes and streamline production 

processes of digital products. 

3.2.3 Phase Two - NACO HPOINFPO Integration 

The second phase, to be implemented in FYlO, will integrate all production components and 

associated staff support in NACO and NFPO. This organizational structure supports a next level 

of business process re-engineering where all activities from development through publication 

(except flight inspection) involving Terminal and Enroute Instrument Flight Procedures as well 

as Visual Aeronautical Charts and support products are integrated in a single team (refer to 

Attachment 21 in the Appendix for the Phase 2 "to be" organizational structure). This 

organization. to be called the National Aeronautical Information Service (NAIS), will support a 

further reduction in FTEs beyond the initiatives presented in the HPO Plan through more 

efficient allocation of work and the elimination of overlapping activities. Work activities 

currently divided into specialized skill areas with some overlapping activities, can be assigned to 

a single team with common IT and aeronautical information skill sets. These streamlined 

processes will also improve quality by ensuring that consistent data is used throughout the 

production process. 

The current process for Enroute airways is a good example of how NACO and NFPO have 

overlapping activities. Currently, NACO receives requests from the ATO-Airspace and Rules 

Group to validate airway change proposals prior to Notice of Proposed Rule-Making publication. 

In addition to providing certification of the proposed description, NACO also provides air traffic 

with graphics of the proposed changes. NACO reviews airway changes throughout the regulatory 

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process and upon final rule publication in the Federal Register updates its airway data files in 

support of DACS, NFD, and NACO charting. NACO reviews all supporting airway data such as 

fixes. NA V AIDs, and altitudes to ensure accurate and timely publication concurrent with airway 

publication. The NACO Airspace Section is also required to identify all NACO charts and 

create/provide the charting sections with airway change lists confirming published changes. At 

about the same time NACO is working airway proposals, specialists at the NFPO are using 

TERPS to certify airway requirements prior to flight check and publication of airway changes. 

This responsibility includes creation of 8260-2 and 8260-16 forms for airway fixes and altitudes. 

The current processes are not in harmony with each other and need to be improved. 

Combining administrative support staffs within NACO, and between NACO and NFPO, would 

recognize further reductions in FrEs. There are currently three separate administrative groups 

within NACO alone performing similar administrative services, in addition to the duplication 

between NACO and NFPO. Through the elimination and restructuring of the current 

management levels at NACO, additional FTE's could be reduced, further meeting the FAA 

organizational guidelines. See Attachment 21 in the Appendix for a depiction of Phase II. 

Benefits: An annual cost savings benefit of $1.54M will be realized as early as FY 13 by 

implementing the proposed re-organization. Implementing the proposed organization in phases 

will allow for a phased reduction in FTE for a total reduction of 12 in NACO (18 total) by FYI3. 

Implementation Cost for Initiative: The implementation cost for this initiative is primarily to 

cover an increase in PC&B, which will occur with the proposed restructuring of management, 

position types, and position grades. The cumulative cost for this initiative covering the period 

from FY09 through FYI3 will be $2.2M. The increased PC&B will be a phased increase and is 

offset by a planned phased attrition rate beginning in FY II. 

3.3 Business Model and Strategy 

3.3.1 Pricing Model- Paper Based Products 

To account for an FY07 recoverable cost shortfall of approximately $14M, the HPO Team 

developed a pricing methodology and recommended new prices for NACO's line of paper 

products. The tcam also recommended new, standardized discount rates for customer groups, 

subscriptions, and product sets to simplify pricing, increase revenues, reduce waste, and 

encourage bulk and advance orders. 

3.3.1.1 Pricing Model Methodology 

The pricing model methodology developed by the HPO Team is based on the principle of 

recovery of allowable costs pursuant to Public Law 106-181. Using production, sales, and cost 

data from FY06 and FY07, the team calculated prices for NACO's paper products that would 

fully rccover allowable costs for sales to public customers. The team then adjusted each 

product's price according to two factors: how far below the calculated price the current price 

was, and the estimated price sensitivity of the product's primary customer groups. In the long 

term, the HPO Team envisions that NACO will continue to evaluate prices annually. adjusting 

them as necessary to minimize the gap between recoverable costs and revenues. 

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3.3.1.2 New Discount Structure by Customer Segment 

During FY07, NACO offered discounts ranging from 10% to 100% (free) to customer groups 

representing three major categories-the general public, 000, and the FAA (internal customers). 

The HPO Team reviewed the discount structure for each customer group and proposed several 

changes with the goal of increasing total revenue. 

3.3.1.2.1 DoD Discount Structure 

The 000 is NACO's single largest customer group, purchasing nearly 50% of NACO products 

during the last two years. In FY07, DoD received a weighted average discount of 86% on paper 

products. While NACO produces some products on behalf of 000 and benefits from DoD's 

cooperation in the production of others, the HPO Team was unable to justify offering a higher 

discount to 000 than to other federal agencies. Consequently, the team recommended that 

DoD's discount be reduced to 40%, the rate offered to NACO's other federal customers. 

3.3.1.2.2 Chart Agent Discount Structure 

Chart agents, who purchase products from NACO and resell them for profit, represent the single 

largest public customer group and benefit from a 40% discount on NACO products. Although 

the discount structure remains the same for chart agents, the model as a whole has been 

improved significantly for the HPO. Section 3.3.2 contains a complete description of the changes 

made to the chart agent agreement. 

3.3.1.2.3 FAA and Other Government Agencies Discount Structure 

Prior to the HPO initiative, FAA customers received NACO products at no cost and without 

restriction. As a result, NACO filled a significant number of standing orders from FAA 

customers without being able to verify receipt or use of the products. Furthermore, NACO was 

forced to bear the full cost of products ordered for FAA usc. In order to increase accountability 

and reduce waste, it was recommended that NACO institute a pricing structure for internal 

customers at a 40% discount beginning in FY09. NACO stands to benefit from increased 

revenues and the expected reduction in unused charts will reduce costs to the FAA as a whole. 

The 40% discount for FAA internal customers will be the same discount offered to all other 

federal agencies. 

3.3.1.2.4 Special Price Groups 

Among the other customer groups, there was little opportunity for a significant increase in 

revenue through changes to the discount structure. Federal law requires that free charts be 

distributed to the Federal Depository Libraries, the Library of Congress, Congressional offices, 

and the National Archives. The team recommends, where products are available on digital 

media, NACO should provide these products in the format with the lowest cost. Public schools 

and libraries represent a very small percentage of sales with a 10% discount. All other public 

customers, including private citizens and commercial enterprises, pay full price for NACO 

products. 

3.3.1.3 New Pricing Structure for Subscription and Sets 

Prior to the HPO initiative, NACO offered a range of discounts on subscriptions. Subscriptions 

are orders for multiple editions of a single product or a set of products to be issued over a period 

of six months or a year. They require payment at the time of sale. Subscription sales require less 

effort in terms of customer service support and payment collection than processing mUltiple onetime sales from the same customer. Recognizing this, the HPO Team sought to raise prices and 

standardize subscription discounts while at the same time maintaining prices at a level that would 

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encourage purchases of subscriptions. To reduce order processing time and costs. the team also 

instituted a discount for full product sets. 

The process for adjusting subscription prices involved two steps. First. the team recalculated 

subscription prices based on the new prices established for constituent products. The team then 

applied a discount of 0% (no discount), 10%. 20%, Of 40% to the subscription price depending 

on the following factors: the number of editions or items in the subscription, the price sensitivity 

of the primary customer groups. the availability of alternatives, and the discount currently 

offered for the subscription. As a result of this process, the average discount on subscriptions 

increased from 12.3% to 14.6%. A 10% discount was applied to full product sets. 

3.3.1.1 Projected Impact of New Pricing Structure 

Production, sales, and cost data for paper products from FY06 and FY07 were used to estimate 

the effect of changes to the pricing structure on revenues givcn historical demand. Thc team 

projects the new pricing structure will incrcase revenues by up to $ll.RM (if demand rcmains 

stable), thus reducing the recoverable gap from approximately $12.3M down to nearly zero, 

maximizing overall allowable cost recovery. The $11.8M revenue projection is based on the new 

pricing and discount structure against the FY07 demand for each customer group. However, to 

account for the transition time/delays to the new structure and any decrcased demand, a more 

conservative revenue projection of $8.9M (75% of maximum revenue projection) is anticipated. 

Thc increased revenue projection and reduced recoverable gap is in-line with the legislation 

mentioned earlier (Public Law 106-ISl) on what NACO is allowed to recover. Table 3.30 

summarizes the projected impact of the new pricing structure on paper products. 

Tb 330P' dI , fN P" -S 

FY07 FY07 FY07 Non- FY07 FY07 Projected Projected 

Customer Production Recoverable Recoverable Rc\cnue Recoverable ReH"nue Recoverable 

Group Cost (AI Cost (BI Cost (CI (DI Gap (B + DI (EI Gap (B + E) 

3.3.2 Chart Agent Model 

To meet the goals of aeronautical safety first, NACO's products are currently available to public 

customers worldwide through mail, telephone and Internet orders. NACO's chart agent network 

increases the distribution of aeronautical products by providing additional points of sale in areas 

frequented by NACO's customers, such as airports and flight schools. This model allows chatt 

retailers to determine the extent of additional distribution. However, they are not allowed to sell 

to other businesses that will resell the products (known as Sub-Agents). Furthermore, chart 

agents ure free to determine which NACO products they sell without restriction to the public. 

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Currently, NACO offers chart agents a 40% discount. which creates an opportunity for profit, 

and the ability to return obsolete merchandise for credit, which reduces the risk to the agent from 

fluctuations in sales. The credits from returned merchandise are applied towards future agent 

purchases, thus reducing NACO's revenue. 

3.3.2.1 Evaluating the Current Chart Agent Model 

In FY07, NACO's chart agent network was comprised of approximately 500 active nautical and 

2,000 active aeronautical chart agents located throughout the U.S., as well as in a number of 

other countries. A vcrage net sales per aeronautical chart agent in FY07 were just under $4,700, 

an increase of about $150 over FY06. However, sales in both years were heavily weighted 

toward the largest aeronautical chart agents. In FY07, the highest-selling 3% of aeronautical 

chart agents accounted for 50% of all aero chart agent sales, with the six highest-selling agents 

alone accounting for about 30% of sales. Net sales per nautical chart agent were $4,348 in FY07, 

a slight decrease from FY06. Nautical chart agent sales were also weighted toward the largest 

agents, with the five highest selling agents accounting for 32% of sales. 

3.3.2.1.1 Average Return Rate 

In FY07, nearly half of all aeronautical chart agents (1,021) had returned more than 20% of 

products purchased, reducing NACO revenue and violating the chart agent agreement. The 

average return rate among all aeronautical chart agents was greater than 24% in FY07. The 

average return rate for those agents above the 20% limit equals 39.8%. Since returns cannot be 

resold, NACO bears the full cost of initial production and distribution of those charts returned. In 

FY07, the cost of returns above the 20% level was approximately $750,000 for aeronautical chart 

agents. 

3.3.2.1.2 Number of Agents below Sales of $500 

In FY07, approximately 20% of all aeronautical chart agents had yearly net sales below $500. 

This number represented an improvement of about 3% from the previous year. Slightly more 

than 30% of nautical agents had less than SSOO in sales in FY07, also an improvement from 

FY06. The administrative expenses of maintaining the chart agent model consist of sales 

materials, the production of agent newsletters, new agent kits, special notices, other 

communication, and shipping costs. 

3.3.2.2 HPO Chart Agent Model 

NACO recognizes that a wide dissemination of aeronautical and nautical navigation data is 

critical to ensuring the safety of air and sea travel. Therefore, in addition to selling products 

directly to the public through NACO's web site, NACO maintains a network of chart agents to 

ensure that aeronautical and nautical navigation products are widely available. In order to 

enhance the chart agent model to run in a lean and efficient manner in-line with HPO goals, the 

following changes will be made: 

• Ensure strict compliance with the current return policy by denying credit to chart agents that 

return 20% or more of merchandise ordered. Based on FY07 quantities, this will achieve an 

estimated savings of nearly $750,000 per year. 

• Increase chart agents' minimum sales requirement from $SOO to $5,000 per year. By 

increasing the minimum sales requirement, NACO will provide agents with an incentive to 

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increase sales. This change will also reduce the total number of agents, thereby reducing the 

number of staff NACO needs for contract administration and records maintenance. 

• Require chart agents to place orders online. This will consolidate sales records and eliminate 

the need for customer service representati ves to take orders by telephone. 

• Permit chart agents to create Sub-Agent networks allowing smaller businesses, which do not 

meet the new minimum requirements, to continue to sell NACO products. Chart agents are 

currently prohibited from reselling NACO's aeronautical and nautical products to other 

vendors. 

• Conduct a survey every six months to solicit feedback and monitor chart agents' satisfaction 

with NACO's service. Chart agents are a significant component of NACO's current public 

distribution strategy and are uniquely able to collect information about the public's demand 

for aeronautical and nautical products. NACO should utilize chart agents to increase the 

NACO's responsiveness to public demand as well as to ensure that NACO is providing the 

agents themselves with the resources they need to distribute NACO's products. 

The team recommends a phased implementation of the changes above to ease the chart agents' 

transition to the new requirements. As a first step. the Distribution Team will begin notifying 

chart agents of the impending changes to the chart agent agreement by October 1. 2008. Chart 

agents will be given one year to demonstrate their ability to comply with the new requirements. 

Beginning on October 1, 2009, agents will be required to sign and abide by the new agreement. 

The projected HPO savings from this new chart agent model are summarized in Table 3.31. 

T a e bl 3 .31: Agent Model Projected Annual 

3.3.3 Miscellaneous 

3.3.3.1 DoD Catalogs 

o' 

Returns above 20% 

Distribution Staff FTE 

Administrative Expenses 

TOTAL 

• H P OS ~ avings 

$750,000 

$375,000 

$107,800 

$1,232.800 

By the beginning of FYIO, NACO will no longer sell DoD aeronautical or nautical products. 

NACO currently produces and distributes a catalog for both DoD aeronautical and nautical 

products at an annual cost of nearly $100,000. Based on the FY07 figures, the expected annual 

savings from discontinuing the DoD catalogs is expected to be approximately $100,000 over the 

HPO period (starting FYIO). Table 3.32 summarizes the savings from the elimination of DoD 

catalogs. 

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T bl 332 D DC 1<'1' • r s' s - Cumulative Expected 

n 2007 FY 2007 Savings 

DoD Catalog Description Quantity Costs (FY 2010-13) 

DoD Ae~()J1autical Catalog 

Production 5,052 $34.828 

Distribution 

DoD Nautical Catalo 

3.3.3.2 Facility Space Savings 

NACO's printing and distribution operations are currently housed in a 142,810 ft2 facility in 

Glenn Dale, Maryland. The building is owned by the General Services Administration (GSA) 

and leased by NACO at a cost of S2.97M per year. Approximately 29,0081'1.2 of NACO's 

warehouse space is currently occupied by DoD products, whieh NACO currently distributes, and 

supplies for the Reproduction Team' s Photo Imaging Sub-Team. The annual cost of this space is 

nearly $605,000. As ofFY10, NACO will no longer distribute DoD products, and the changes to 

NACO's pre-press processes will eliminate the need for photo imaging supplies. NACO will be 

able to return the unoccupied space to the GSA for an annual savings of approximately 

$605,000. Table 3.33 summarizes the savings. 

3.3.3.3 Facility Services Savings 

NACO currently provides space in its Glenn Dale and Silver Spring facilities to the FAA A TOA. Although ATO-A currently pays NACO for the use of the space, ATO-A does not pay for any 

portion of the services associated with these facilities, such as security and on-site health care. 

The HPO Team recommends that NACO begin charging ATO-A for these services in proportion 

to the amount of space leased and the number of employees on-site. In doing so, NACO would 

save approximately $194,000 annually beginning in FY09. Table 3.34 shows the potential 

benefit to NACO from recovering these facilities service costs. 

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Table 3.34 Facilitv Service Costs Summary 

ATO-A Share ATO-A Share 

Facility Service Total Cost (%) ($) 

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SECTION 4: EXPECTED SAVINGS, PERFORMANCE TRACKING AND 

CONTROL, IMPLEMENTATION, AND CONTINUOUS 

IMPROVEMENT 

4.1 Expected Savings/Financial Impact and Costs 

4.1.1 Expected Savings/Financial Impact 

The NACO HPO will realize significant savings throughout the five-year time frame, with year 

five realizing the most savings, The year five annual savings of $152M is expected to continue 

on an annual basis beyond the HPO performance period, In addition, the new pricing structure 

will increase revenues annually by a projected $8,9M, As NACO implements the HPO 

initiatives, an annual total financial impact of approximately $24M (cost savings plus increased 

revenue) is projected by FY 13, Over the entire five year HPO performance period. estimated 

cumulative impact is projected at $90M, The final year savings from the baseline cost estimate is 

approximately 28%, The increased revenue from the new pricing model is expected to continue 

after the five year HPO time frame at least in the short term until further analysis of digital 

pricing impact can be achieved, Table 4, I summarizes the entire HPO projected cost savings and 

total Ilnancial impact, and Table 42 summarizes the FTE savings, 

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4.1.2 Implementation Costs Summary 

Nearly all of the implementation costs are associated with the AVN Integration described in 

Section 3.1.1. To ensure the cost savings are realized by FY13, the envisioned organization must 

be implemented prior to the end of FYI2. Therefore. the estimated implementation cost of $17M 

must be funded by FY II. The Reproduction implementation cost of $0.30M for an additional 

CTP machine should be funded by FY 10 for the full benefit. Table 4.3 summarizes the projected 

HPO implementation costs. 

T bl 43 S fPr' t dHPOI t ti C t 

Software 

Hardware! Software De\elopmentl Labor I 

Initiathe Equipment Procurement Con"ersion Contract Training Total 

AVN 

Integration $0.82 M $0.63 M $9.24M $S.77M O.54M $17.0 

Reproduction 0.30 M $0 

4.1.3 Additional Workload Cost Summary 

As mentioned in Section 3.1.4, NACO/ A VN will realize new and increased work requirements 

in addition to the baseline requirements during the HPO time frame. These new requirements 

represent an equivalent of approximately 47 FfE's costing around $5.7M annually. Due to the 

NACO HPO changes, it is expected that the additional 84,020 annual labor hours will be met 

using the significant amount of resource savings through the efficiency gains described in 

Section 3. Approximately $IM will be funded separately for the additional RVM and ERAM 

workload and the remaining $4.6M cost avoidance will be achieved with the HPO 

implementation. Table 4.4 summarizes the additional work requirements and associated costs. 

T bl 44 Add'f I W kI d R . Is S 

Annual Labor Annual Cost of 

Section FY13 and Beyond Requirements Hours New Workload 

3.1.4.1 

3.1.4.2 

3.1.4.3 

3.1.4.4 

3.1.4.5 

3.1.4.6 

Enroute Automation ~odernization (ERAM) 

Common Airport Mapping Initiative (CAM]) 

Obstacle Repository System (ORS) 

New Aeronautical Chart Products 

Radar Video Maps (RVM) 

Increase in New & Amended IFP and NonProcedures Revisions 

4.2 Performance Tracking and Control 

4.2.1 Periormance Management Plan (PMP) 

_-I-_____ -..C1"".04Q..f-____ $70,720. 

3.520. $239.360 

29.894 $2,0.32,792 

922 $62,719 

14.256 $969,40.8 

34.388 $2.338.394 

A PMP will be created to evaluate the HPO's performance in each of the initiatives described in 

the Envisioned Organization. The PMP will include, but may not be limited to, a performance 

management team structure, surveillance/performance evaluation methods and plans, 

documentation requirements, corrective action plans, reporting requirements, and a work change 

notification plan. In addition, ISO quality objectives and metrics will be established in the AVN 

Quality Management System (QMS) to measure improvements in the quality of products and 

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services. The PMP and ISO QMS will ensure that the HPO implementation and performance 

goals are met. 

4.2.2 HPO Cost and Savings Tracking Report 

The HPO Team created an HPO Cost and Savings Tracking Sheet to capture and monitor actual 

cost and savings against the baseline over the five-year performance period. There are four 

sections to the tracking report: 

• Actual Costs The report allows NACO to track costs and savings by labor and non-labor 

categories, such as equipment costs. material and supply costs, travel costs, and other costs. 

This is a higher level report that provides an overview of costs and savings at the agency 

level. 

• COMPARE Costs The baseline and HPO labor and non-labor costs were entered into 

COMPARE. The tracking sheet covers four sections grouped by COMPARE: Personnel 

Costs, Material and Supply Costs, Other Specifically Attributable Costs, and Overhead Costs. 

• Initiative Tracking Each initiative has its own report which includes a Before and After 

Trackin[? table with key metrics, costs and revenue, and a Financials Trackin[? table that 

shows revenue impact, cost savings. and return on investment. Initiatives include the pricing 

model, Reproduction and Distribution staffing analysis, chart agent model and the AVN 

Integrated initiatives. 

• Actual Savings Summary - This sheet summarizes the costs savings and impact on rcvenue 

for each initiative across the five year HPO performance period. 

4.3 HPO Implementation 

4.3.1 Implementation Plan 

The overarching objective of the HPO implementation will be to transform NACO from its 

current state to the envisioned organization efficiently and without any negative impact on 

NACO's sustained performance of core activities. The HPO Team was mindful of the feasibility 

of implementation in developing recommendations for the NACO HPO. The HPO Team and 

NACO's leadership will jointly develop an implementation plan that identifies clear and 

achievable goals, specifies a realistic timetable for the change initiatives, and delineates clear 

roles and responsibilities for NACO/AVN staff. As a long-term initiative, NACO staff will begin 

to monitor organizational perfonnance more closely through the use of performance metrics. As 

part of the HPO effort. the tools created to enable NACO staff to track progress toward the 

envisioned organization will be explicitly linked to implementation milestones. Full 

implementation of the envisioned organization is expected to be complete by the fifth year of the 

HPO period (FY13). 

Managing the workforce transformation required to implement the HPO is a critical element of 

the effort. Since the beginning of the process, avoiding a costly and disruptive reduction in force 

has been a principal concern of the FAA leadership. The HPO Team recognized early on that the 

high number of NACO employees that would become eligible for retirement during the HPO 

period represented both a threat and an opportunity for the organization. By communicating the 

organization's plan effectively to their employees, the HPO Team anticipates that the NACO 

leadership will be able to achieve the necessary workforce reduction through attrition, To reach 

HPO White Paper 52 
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Federal Aviation Administration National Aeronautical omce 

the Reproduction Team's optimal staffing levels within the projected time frame, the HPO Team 

recommends that NACO pursue buy-out authority. 

4.3.2 Training Program 

An enhanced training program is critical to ensure a successful transition to the Envisioned 

Organization. Formal training will be needed to transition the workforce from their current skill 

sets into an Aeronautical Information Specialist role in support of the HPO plan. The HPO Team 

recommends that NACO establish a formalized training program, which should include a 

training team carved from the current resources (FTEs) and also convert the current server room 

(space) in Silver Spring Metro Center (SSMC). This space should be converted into a training 

roomlcollaborative meeting space. 

4.4 Continuous Improvement Management Plan 

In addition to the measures described in detail in this document, the HPO Team recommends that 

NACO undertake several initiatives to meet future challenges and sustain organizational 

improvement during and beyond the HPO period. An HPO Continuous Improvement 

Managcment Plan (CIMP) will be created to ensure continuous progress, forward planning, and 

further efficiencies throughout the HPO time frame. The CIMP will include a review committee 

structure to evaluate. approve, and track improvements as part of the HPO. As an example, the 

HPO Team makes the following continuous improvement recommendations to be undertaken 

during the HPO performance period: 

• Pursue to shift the USPS budget authority and funding currently allocated to FAA Printing, 

Distribution and Mail Program, APF-OOI over to NACO to provide flexibility in procuring 

the best value for small parcel shipping. Currently the small parcel shipping options for 

NACO's distribution program are FAA mandated options of U.S. Postal Service (USPS) and 

Federal Express (FedEx). Current annual shipping costs are approximately $2M, and 

substantial savings (estimated at 10% of current expenses) could be realized by allowing 

NACO to obtain alternative shipping services to include other sources such as the United 

Parcel Service (UPS) to provide for competitive pricing. 

• Convene a working group to study and develop a strategy to address the expected long-term 

decline in demand for paper products and growth in demand for digital products. As 

electronic navigational equipment becomes more widely available and accepted, NACO faces 

a shift in demand that will entail fundamental changes to its business model. The HPO Team 

recommends that a working group be created to forecast the long-term trends in demand for 

NACO's products, establish a pricing methodology for NACO's digital products. and identify 

strategies for efficiently and effcctively meeting the aviation community's need for reliable 

aeronautical information in the future environment. 

• Implement robust data collection and analysis processes to more accurately forecast demand 

in the short and mid term. Improved forecasting processes could reduce waste from 

overproduction, prevent costly re-prints, and help managers anticipate fluctuations in revenue 

and costs. 

• Implement an electronic data interchange (EDI) system to standardize and streamline 

commercial interactions with chart agents. Once established. an EDI system could 

HPO White Papcr 53 
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Federal A viation Administration National Aeronautical Office 

significantly reduce NACO's need for clerical and administrative support for the distribution 

unit and ensure the integrity of NACO's accounting records. 

• Implement best practices in procurement. NACO currently relies on contractor assistance at 

the data transfer, production, and distribution stages. NACO should re-evaluate its current 

contract arrangements to ensure that they offer the best available combination of price and 

service. Specifically, all future and existing printing support contracts need to be evaluated for 

nationwide competition and elimination of unnecessary requirements. This will prevent high 

cost sole-sourced printing contract awards. NACO will realize the best value from future 

procurement by specifying contract requirements clearly and targeting them to NACO's needs 

and by facilitating competitive, nationwide solicitations. 

HPO While Paper 54 
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Federal Aviation Administration National Aeronautical Office 

< This page intentionally left blank> 

IIPO White Paper 55 
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Federal Aviation Administration National Aeronautical Charting Orfice 

SECTION 5: MILESTONES 

Table 5.1 lists key HPO milestones along with schedul ed completi on and current status. 

Table 5. 1: K ey H PO M ilestones 

" .,',1' Milestone Schedule Status 

Completion 

Establishment of BPRlHPO Team Completed 

Calcul ation of baseline costs refl ecting full costs of February 2008 Compl eted 

gove rnment performance 

Development of improved work acti viti es/processes and May 2008 Completed 

business mode l 

Final HPO White Paper & Briefin g for OMB September 2008 Earl y (June) 

Completion 

Implementati on of BPRlHPO September 2008 On-schedule 

Performance tracking FY 2009 and On-schedule 

later 

HPO White Paper S6 
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The House Committee on Transportation and Infrastructure's Subcommittee on Aviation 

Hearing on Review of FAA's Implementation of the FAA Modernization and Reform Act 

Thursday, May 16 2013 

Questions for the Record for FAA Administrator Michael Huerta 

Rodney Davis - Illinois 13th District 

(1) What is the status of the report that details the FAA's plans to develop and implement Required 

Navigation Performance (RNP) procedures specifically at 35 mid-sized commercial airports, which is 

required under Section 213(b)? 

The Report to Congress on Section 213 has been completed and is currently in coordination within the 

Agency and the Department of Transportation before publication. 

(2) Can you please explain the level of stakeholder involvement in the development of the two reports 

required under Subsections 213(a) and (b)? 

As part of the process for developing the reports required by 213 (a) and (b), a comprehensive review of 

airports was completed and resulted in the focus of accelerated PBN efforts at 30 core (formerly titled 

Operational Evolution Partnership airports, or OEP) and 35 non-OEP airports. The results of the review, 

by airport, have been provided to all stakeholders via the FAA public website. As we move forward, 

stakeholder participation is paramount to success of PBN development. Therefore, stakeholder inclusion 

and participation during workgroups is a vital part of procedure development. 

https:l/www.faa.gov/air traffic/flight info/aeronav/procedures/reports/ 

Before and since enactment of the FAA Modernization and Reform Act, the FAA has been actively 

collaborating with the parties listed in Section 213 about the acceleration of NextGen technologies. In 

addition, representatives of these stakeholders are an integral part of several working groups and 

initiatives designed to accelerate NextGen implementation. Airport industry groups, Airlines for America 

(A4A), and air carriers are members of the NextGen Advisory Council (NAC) and the RTCA Operational 

Capabilities Working Group (OCWG). Aircraft and avionics manufacturers are also part of the NAC. 

Qualified third party vendors and the Aircraft Owners and Pilots' Association (AOPA) and National 

Business Aircraft Association (NBAA) belong to the RTCA Airspace and Procedures Working Group. Air 

carriers and aircraft and avionics manufacturers are part of the Performance-Based Operations Aviation 

Rulemaking Committee (PARC). On January 14,2013, FAA sent letters to representatives of these 

groups summarizing the information available on the FAA's Instrument Flight Procedures Information 

Gateway, a public website listing all PBN instrument flight procedures. Existing and proposed procedures 

are identified on the website and individuals can sign up for alerts about future procedures. 
125 


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(3) During the hearing we talked about how the FAA is currently utilizing the services of third party 

designers to help develop RNP procedures at a handful of smaller commercial airports. What are the 

FAA's plans to use third parties to comply with Section 213? 

On May 10, 2012, the FAA awarded the Third Party Vendor Performance Based Navigation (PBN) 

Demonstration contract to GE-Naverus, ITT -Excelis teammate for the demonstration of third party 

development and delivery of two (2) public Required Navigation Performance (RNP-AR) procedures at 

five (5) FAA-selected mid-size airports (Syracuse NY, Milwaukee WI, Anchorage AK, Dayton OH, and 

Buffalo NY). In this demonstration project, the 3rd Party Vendor is solely responsible for all aspects of the 

full life-cycle development, design, and implementation of the RNP Procedures. 

They are delivering a total of 10 RNP Procedures (two for each airport) within two (2) years of the 

Contract Award (May 11, 2012 to May 10, 2014). The Vendor is tasked with conducting feasibility 

studies, sites outreach, and environmental assessments to include the preparation of all environmental 

paperwork, and providing pre and post implementation support at each location. 

To date, none of the procedures have been fully implemented. The FAA developed a draft Plan to 

conduct reviews and assessment of the Pre and Post Implementation Reports, Environmental Study 

Reports, and the Final Procedure Design Review Package. The Plan also includes coordination with the 

Systems Analysis & Modeling Division to identify measurable benefits and develop metrics criteria to track 

and report progress. 

After the procedures are developed and implemented at all five sites, the FAA will conduct an 

assessment of the Demonstration Program to determine the efficiency and benefits of using third parties 

to expedite the delivery of Performance Based Navigation benefits. The results of this demonstration 

project will be evaluated to determine future 3rd Party involvement in FAA RNP procedural development. 

(4) What is the status of the FAA's implementation of the procedural streamlining provisions under 

Section 213(c)? In particular, please explain how the FAA plans to use its expanded categorical exclusion 

authority in circumstances when a performance-based navigation procedure will result in reduced fuel 

consumption, carbon emissions and noise on an average per flight basis? 

There are two subsections under Section 213(c). Section 213(c)(1) provides a categorical exclusion for 

certain required navigation performance and area navigation procedures. The FAA has issued guidance 

for implementing this provision. Section 213(c)(2), referred to above, requires a determination of three 

measurable reductions-fuel consumption, carbon dioxide emissions, noise-on a per flight basis. The 

FAA has conducted an assessment of existing methodologies for determining noise and has to date not 

been able to identify a sound approach for making the noise determination on a per flight basis. In 

September 2012, the FAA asked the NextGen Advisory Committee (NAC) for assistance in further 

exploring how to make use of this categorical exclusion. The NAC has provided a recommendation to the 

FAA, as approved at a June 4 meeting and the FAA is evaluating the recommendation. 
126 


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The Honorable Michael P. Huerta 

Administrator 

F ederal Aviation Administration 

800 Independence Avenue S.W. 

Washington, D.C. 20591 

Dear Administrator Huerta: 

May 20, 2013 

Nick .ll. illnqnl!. 1111 

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JamesJl.ZQ'u.,i)cmQcn>-!Slaff)lin)'-:lo;>!" 

I thank you for your testimony before the Subcommittee on Aviation on May 16,2013, 

regarding implementation of the FAA Modernization and Reform Act. I would also appreciate 

your written response to the following questions for the hearing record. 

As part of the Federal Aviation Administration's (FAA) NextGen program, the agency 

intends to require that the majority of aircraft be equipped with Automatic Dependent 

Surveillance-Broadcast (ADS-B) systems by 2020 (14 CFR Part 91). The FAA exerted its 

global leadership in aviation technologies by adopting ADS-B as a cornerstone of the next 

generation of air traffic control, making use of GPS technology to detennine and share aircraft 

location information. ADS-B is intended to improve upon and replace today's current system of 

radar based navigation. 

Because almost all aircraft will be equipped with ADS-B to comply with FAA's 2020 

mandate, some have argued that using space-based ADS-B to extend uninterrupted coverage over 

oceanic environments could provide benefits well beyond the traditional limitations of the 

ground-based radar system - including important environmental benefits through fuel 

consumption optimization by allowing for efficient routes and flight altitudes. 

As you are aware, the President recently signed into law the Reducing Flight Delays Act 

of 2013, which provides your agency with additional fund transfer authority to implement 

sequestration. The intent of this legislation was primarily to end air traffic control furloughs and 

to avoid the closure of 149 contract air traffic control towers. 
127 


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Honorable Michael P. Huerta 

May 20, 2013 

Page 2 

(1) Do you envision transferring any funds from NextGen programs to cover 

furlough-avoidance and contract tower costs? 

(2) What effect will this have on the FAA's consideration and possible adoption of oceanic 

ADS-B? 

I would appreciate your written responses no later than May 31, 2013. Thank you again for 

your testimony. 

Sincerely, 

RICK LARSEN 

Ranking Democratic Member 

Subcommittee on Aviation 

Committee on Transportation and Infrastructure 
128 


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The House Committee on Transportation and Infrastructure's Subcommittee 

on Aviation 

Hearing on Review of FAA's Implementation of the FAA Modernization and 

Reform Act 

Thursday, May 16,2013 

Questions for the Record for FAA Administrator Michael Huerta 

Rick Larsen - Washington 2nd District 

QUESTION: 

As you are aware, the President recently signed into law the Reducing Flight 

Delays Act of 2013, which provides your agency with additional fund transfer 

authority to implement sequestration. The intent of this legislation was 

primarily to end air traffic control furloughs and to avoid closure of 149 

contract air traffic control towers. 

Do you enVISIOn transferring any funds from NextGen programs to cover 

furlough avoidance and contract tower costs? 

ANSWER: 

The Reducing Flight Delays Act of 2013 (P.L. 133-9) provided FAA with the 

budget flexibility needed to end employee furloughs across the agency and keep 

149 low-activity contract towers originally slated for closure in June open for the 

remainder of fiscal year 2013. 

Section 2(a)(I) of this legislation permits FAA to transfer up to $253 million from 

the Grants-In-Aid for Airports (AlP) account pursuant to section 47117(t) of title 

49, United States Code. The FAA therefore intends to transfer $247.2 million to 

the FAA Operations account and $5.8 million to the Facilities and Equipment 

account. The first transfer of at least $100 million will occur on July I and the 

remaining balance will be transferred on August 15. Funds will only be transferred 

out of the AlP account, not out of any NextGen programs. 
129 


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In fact, in addition to ending furloughs and keeping contract towers open, the 

transferred funds will also minimize cuts and delays in core NextGen programs 

and partially restore infrastructure support activities in the national airspace 

system, thereby reducing the risk of delays. As such, our overall NextGen efforts 

will benefit from this budget transfer. 

QUESTION: As you are aware, the President recently signed into law the 

Reducing Flight Delays Act 0/2013, which provides your 

agency with additional fund transfer authority to implement 

sequestration. The intent of this legislation was primarily to 

end air traffic control furloughs and to avoid closure of 149 

contract air traffic control towers. 

ANSWER: 

What effect will this have on the FAA's consideration and 

possible adoption of oceanic ADS-B? 

The FAA has been evaluating various approaches for improving separation 

services by providing surveillance coverage in Oceanic Flight Information Regions 

(FIRs) and remote domestic airspace via a satellite-based solution, including, but 

not limited to, Space Based Automatic Dependent Surveillance - Broadcast (ADSB). In 2012, the agency began an Investment Analysis of various alternatives to 

determine technical feasibility, validate concepts, and develop a detailed benefit 

and cost analysis. 

The work on this analysis was not impacted by Sequestration and the analysis is 

still ongoing. However, given the agency's current budget constraints, we have 

not yet reached a final decision of whether or not to financially commit to the 

Space Based ADS-B initiative. 

In addition to the Space Based ADS-B activity described above, the FAA is 

currently conducting operational flight evaluations of the ADS-B In Trail 

Procedures (ITP) concept on United Airlines aircraft in revenue service, on oceanic 

routes between the Oakland Flight Information Region (FIR) between the U.S. 

west coast and Australia, using certified avionics equipment. The data collected 
130 


Insert offset folio 117 here 80937A.117

will be used to validate operational perfonnance and economic benefits oflTP, 

validate safety requirements and assumptions and monitor operational hazards. 

This data collection was not impacted by Sequestration or furloughs and is 

expected to end in April 2014. 
131 


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The House Committee on Transportation and Infrastructure's Subcommittee on Aviation 

Hearing on Review of FAA's Implementation of the FAA Modernization and Reform Act 

Thursday, May 16, 2013 

Questions: 

Question for the Record for FAA Administrator Michael Huerta 

Andre Carson, Indiana 7th District 

During our last hearing, I expressed my concerns about the integration of Unmanned 

Aircraft Systems, or UAV's, into civilian airspace Icading up to the issuance of 

regulations by FAA in 2015. Since that hearing, I have become even more concerned 

about reports regarding the inappropriate commercial use of drones, including a number 

of disturbing incidents of "drones for hire." In fact, a local television station in 

Indianapolis hired such a "drone for hire" which flew over a Department of Defense 

facility in my district and collected video images during this flight. Mr. Chairman, I'd 

ask unanimous consent to otfer an article about this incident into the record. Mr. 

Administrator, these unauthorized flights pose a threat to public safety, and as a former 

law enforcement officer, I have urged unauthorized operators to stop breaking the law. 

But I am particularly concerned about the instances where the FAA issued cease and 

desist orders against commercial operators of drones and they were ignored. So, Mr. 

Administrator, [ have a couple of questions: 

a) To what extcnt are cease and desist orders being enforced? In situations where 

they have not been enforced, can you tell us why? 

b) How many ccase and desist orders have been issued regarding unauthorized 

use of drones? How many of these wcre commercial or non-recreational 

operators? How many ofthese cases have been referred for prosecution or 

have had fines assessed? 

c) Does the FAA need additional staffing to adequately investigate these 

problems? Or can the FAA utilize assistance from DI-lS, FBI or other federal 

agencies? Is this happening? 

Answers: 

The FAA has not needed to issue any UAS cease and desist letters to datc. We have 

issued three Lettcrs of Investigation (LOI) and three Enforcement Investigative Reports 

(ErR). None of the LOIs or ErRs were issued to "commercial" operators as a commercial 

operations category is currently not authorized. The operators who receivcd the LOIs and 

EIRs are eonsidered uncategorized as they did not fall into one of the three authorized 

categories: I) Model aircraft. 2) Public aircraft operating under a Certificate of Waiver or 
132 


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Authorization, or 3) Civil aircraft authorized to fly in an experimental category. There 

are three EIRs proposed fines; two are pcnding and onc is in abeyance due to 

incarceration of the recipient. 

OUf resources are sufficient to deal with current enforcement needs. Should the FAA 

need to expand its enforcement actions related to UAS operations, we welcome 

coordinated assistance from othcr govcrnment agencies, such as DHSIDOJ/FBI. 

Question: 

d) Finally, please tell us about the status ofthe preliminary UA V guidelines due 

this summer? Can you tell us when these guidelines will be released? And 

what wil\ be the general provisions of these guidelines? 

The FAA and DOT are coordinating a Notice of Proposed Rulemaking (NPRM) to address 

requirements for small VAS, which is targeted for release later in 2013. 
133 


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Indiana pilots call drones for hire a growing threat 

FAA struggles to drones for hire 

INDIANAPOLIS - A hidden camera investigation from the Call 6 Investigators found a growing 

threat from illegal business flights of drones nationwide, prompting concerns from Indianapolis 

pilots and calls for action in Congress. 

While the Federal Aviation Administration has not approved a single drone flight for business 

purposes anywhere in the country, the Call 6 Investigators found many businesses and 

entrepreneurs flying drones for aerial photography, including several that advertise drone flights 

in Indiana. 

The Call 6 Investigators also pushed for the release of new documents from the FAA that show a 

rising number of safety complaints from pilots, as well as several drone companies that continue 

to fly after being warned by the FAA that their flights are illegal. 

"I hope that the FAA gets involved in this and we get this stopped. This is a dangerous situation," 

Indianapolis pilot Roger Tomey said in response to the Call 6 Investigators' report. 

Drones, or Unmanned Aircraft Systems (UAS), are only legal for hobbyists to fly under 400 feet 

of altitude and away from airports and populated areas, according to standing FAA rule s. The 

agency has ruled that any time money changes hands or profits are generated from flying a 

drone, those hobbyist rules no longer allow such flights. 

The Call 6 Investigators requested enforcement documents, never before released by FAA, 

showing a rising number of complaints about drones surprising manned aircraft pilots in the air. 

The documents also show the FAA frequently issuing cease and desist letters or other warnings 

to drone services found to be advertising flights for hire, usually to produce aerial photography. 

Among the highlights of those enforcement documents reviewed by Call 6 Investigators: 
134 


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23 investigations were launched by FAA over the past two- years in response to 

complaints or inspectors finding drone flights depicted online 

10 drone operators received warning letters or advisories that their flights were illegal 

5 unauthorized drones were spotted by pilots and reported to FAA 

Several drone operators garnered new complaints after having been previously warned by 

the FAA that their flights were illegal 

In some cases, the FAA closed its investigations into illegal drone flights when the suspected 

drone operators would simply claim that photos posted online were actually taken from licensed 

and manned planes or helicopters. 

"It concerns me greatly. This is an accident waiting to happen," said Tomey. "You"re going to 

end up causing a very serious situation that could cost somebody their life," he said, calling the 

Call 6 Investigators reporting "highly upsetting." 

FAA enforcement records provided to the Call 6 Investigators also included: 

March 2011 -- The only fine ever issued: A proposed $10,000 fine against a drone 

operator for an aerial picturc-taking flight at University of Virginia (Charlottesville), where 

FAA inspectors wrote that dangerous maneuvers were performed near bystanders. 

March 2012 -- FAA inspectors wrote that drones were used in filming of "On Dangerous 

Ground" in Alaska. Case closed when drone operator couldn't be established. 

October 2012 -- FAA asked for Orlando police assistance in locating a drone near an 

airport. Pictures were posted online, but case was closed when operator couldn't be 

established. 

Several investigations launched in New York City after photos were posted online or 

drones were reported by bystanders. 

August 2012 -- Contractor hired to map out evacuation routes for FEMA admitted to 

flying up to 10,000 feet without any approval by FAA 

November 2012 -- Operator of drone warned to stop after online video showed Hight near 

Winthrop, Mass. 

September 2012 -- Air traffic controller in Warwick, R.I. complains of drone flying in his 

airspace 

September 2011 -- Pilot in Houston reported spotting drone flying near him along 

Interstate 10 near downtown 

May 2012 -- Pilot in Fredericksburg, Va. reported seeing drone pass within 100 feet of 

his wing 

In March of this year, an Alitalia airliner made national news headlines when the pilot reported 

spotting a drone as he was trying to land at New York's JFK Airport. 

An Indianapolis pilot of a small plane reported spotting a drone to airport managers in 

Greenwood. Those managers told Call 6 Investigators that the pilot spotted the drone a few 

hundred feet below him and flying in the opposite direction at a high rate of speed. 

Another Indianapolis pilot, Tom Jeffries. who runs a night school at the same Greenwood 

airport. said, "It just puts a whole new dimension on the idea of safety, because we're concerned 

about birds, we're concerned about other airplanes, and now we're throwing in something that is 

totally uncontrolled. 
135 


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"They're not going to appear on radar, you're never going to see them until they hit something," 

Jeffries said. 

"When they suck one of those drones into the engine of an airplane, then it'll get everybody's 

attention. And they'll have to do something at that point," he said. 

Hidden cameras aimed at Indianapolis drone flight 

The Call 6 Investigators found several companies advertising drone flights anywhere in Indiana. 

One company quoted the price of$500 per hour or $2,000 per day for snapping photos or 

shooting video from a drone. 

That company representative said he had flown hundreds oft1ights for TV commercials and real 

estate ventures, including a TV commercial last month for a Houston car dealership. 

The Call 6 Investigators went undercover to hire another drone company for a flight above a 

neighborhood on the eastern edge of Indianapolis. 

Brandon Spencer, owner of Drone Photo Scrvices of Louisville, offered to snap photos of several 

parcels ofreal estate along Post Road and East 56th Street for $300, claiming he'd flown 

hundreds of other f1ights. 

When he did not know he was speaking to a reporter, Spencer said he could fly at any altitude 

that a customer would want. He said he "wasn't supposed to" l1y above 400 feet, but he 

sometimes f1ew above 1,000 feet or higher, depending on the job. 

Local pilots pointed out that they often f1y at that same altitude in small planes and helicopters. 

Some pilots expressed concerns about mid-air collisions or "drones for hire" crashing into 

homes, cars, or people on the ground. 

Spencer arrived for the arranged meeting and cameras were rolling as he scouted out a small lot 

from which to launch his drone. He removed thc aircraft from the passenger seat of his pickup 

truck, strapped on a remote control device on a vest, attached a battery and then took to the air. 

Passing motorists barely noticed as the drone rose into the air, clearing the tree line and then 

hovering more than 300 feet in the air. 

After he was paid $300 for the aerial photos, the Call 6 Investigators team emerged to question 

him on camera. 

When asked ifhe researched the laws on f1ying drones for profit, Spencer answered, "No ... I 

just got into it thinking I could make a little money." 

When asked if he was putting people in danger with f1ights that were not approved by the FAA, 

he answered, "Not that I know of." 

While his company's website displayed pictures of a water treatment plant, construction sites and 

a pedestrian bridge in Louisville, he claimed no money changed hands for those flights. 

"You're actually my first paying customer," he told the Call 6 Investigators. 

"1 just figured, you know, they're selling it out there, I can buy it, I can get it and, it's a 

helicopter. People fly helicopters and planes all the time, put a camera on it and try to make a 

little bit of money. That's what I thought," he said. 

"IfI'm going to get in any trouble over it, it's not worth it," said Spencer. 
136 


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He said he had paid $10,000 for his helicopter-like drone, known as an F800 Hexacopter that 

was made in China. 

Several pilots and other drone operators also mentioned another leading competitor for paid 

drone flights known as Copter Kids LLC of Reno, Nev. Company representatives did not 

respond to emails requesting comment. 

A spokesman with the FAA's Unmanned Aircraft Systems section, Les Door, said that no 

commercial flights have ever been permitted anywhere in the country, including those involving 

real estate agents or news organizations. 

Several types of drones were on display for sale earlier this month at the National Association of 

Broadcasters convention in Las Vegas. Television and news executives saw a number of aircraft 

that could be used for aerial photography once the FAA establishes guidelines. 

Congress has mandated that the FAA come up with regulations for allowing commercial flights 

of drones in late 2014, but it remains unclear whether training will be required for all drone 

operators or whether air traffic controllers will be alerted to all flights. 

With so many flights taking to the air in advance of those regulations, the Call 6 Investigators 

asked FAA headquarters whether enough was being done to protect people from unauthorized 

drone flights. 

The agency responded with a written statement (in its entirety): 

"The FAA thoroughly investigates possible violations of the agency's regulations by unmanned 

aircraft operators. In cases where we have verifiable proof of a violation, we do not hesitate to 

pursue enforcement action. Lacking such proof: we still make sure the operator understands FAA 

regulations and policy on unmanned aircraft systems. We expect to publish a proposed rule on 

small unmanned aircraft later this year that will offer regulations for a wide variety of users in 

the small UAS community, including commercial operators." 

U.S. Representative Andre Carson, D-Indi<mapolis, member of the House aviation 

subcommittee, said the Call 6 Investigators' reporting has him pushing for action at the FAA and 

among members of his committee. 

He wrote in a statement (in its entirety): 

"As a member of the Transportation and Infrastructure Subcommittee on Aviation and as a 

former law enforcement officer, I am very concerned about the instances where the FAA issued 

cease and desist orders against commereial operations of drones and they were ignored. 

Commercial drones, including drones for rent, arc not authorized under current law and pose a 

threat to public safety. 

"Even before the new regulations go into effect in 2015, we must ensure the FAA is enforcing 

current law as vigorously as possible and adequately protecting the safety of air traffic and those 

of us on the ground. I will be raising these coneerns with the committee, as well as the FAA. 

"I also encourage all drone operators to do the right thing and stop all flights. Unauthorized 

drone Hights put lives at risk and should not be continued, even when FAA fails to enforce the 

law." 
137 


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A trade group that represents industries using robotics or unmanned aircraft, the Association for 

Unmanned Vehiele Systems International in Arlington, Va., has released a code of conduct for 

its members who may be testing or designing drones for future use. 

"AUVSI condemns the misuse ofUAS, and believes that anyone who abuses UAS technology 

should be held accountable," said the group's Melanie Hinton in an email to the Call 6 

Investigators. 

She said her group is working with the FAA and others to carve out rules for the safe operation 

of unmanned aircraft. 

"AUVSI expects all users ofUAS to abide by FAA guidelines, including receiving an FAA 

Certificate of Authorization before using the technology," she wrote. 

Indiana State University in Terre Haute has actually started its own drone program to train 

students how to fly unmanned aircraft. The program's leader and another instructor did not 

respond to requests for comment. 

Even local police agencies are not yet approved to fly drones for routine public safety missions. 

In January 2010, the nation's first-evcr test flight ofa police drone made headlines worldwide, 

but the FAA still hasn't drawn up plans for how police drones can be safely integrated into the 

nation's airspace. 

Unlike commercial drones, police agencies can apply for a Certificate of Authorization (COA) 

from the FAA for specitlc flights, but very few flights have actually been requested or approved, 

according to the FAA. 

While police use of drones have spurred debate over civil liberties or spying on people without a 

warrant, the FAA's review of how to regulate police flights has focused solely on airspace safety. 

The FAA is poised to announce six drone test sites around the country, including one in Indiana, 

where police or private commercial ventures will be able to test their aircraft prior to a full 

battery of regulations being issued for all drone tlights. 

For Jeffries, the Indianapolis Hight instructor, it's a scary notion. 

"Everybody could have their own drone. They could do all kind of things from taking pictures, 

who knows, seeding their yard, anything! I mean, it's just organized confusion," he said. "It has 

some broad-reaching implications if we don't get some kind of control of what's going on." 

Copyright 2013 Scripps Media, Inc. All rights reserved. This material may not be 

published, broadcast, rewritten, or redistributed. 

http://www.theindychannel.com/news/call-6-investigatofs/indiana-pilots-call-drones-for-hire-agrowing-threat 
138 


Insert offset folio 125 here 80937A.125

lllitl JS.iju.ltr 

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Christopherl'.B<.>rua.m,Stafrm",C(or 

Hon. Michael P. Huerta 

Administrator 

Federal Aviation Administration 

800 Independence Avenue, SW 

Washington, DC 20591 

Dear Administrator Huerta: 

May 20, 2013 

Nick ill. lR.4.U. :!J3J 

lRankiuglll!embt< 

Jnm""ll,ZQ>a, Democ:ratSt.lITD!l'<:'ct\l' 

On May 16,2013, the Subcommittee on Aviation held a hearing on "FAA's Progress in 

Implementing the FAA Modernization and Reform Act." 

Attached are questions from Rep. Ann Kirkpatrick for you and your staff to answer for 

the record. I would appreciate receiving your written response to these questions no later than 

Friday, May 31st so that they may be made a part of the hearing record. 

Enclosure 

Sincerely, 

Rick Larsen 

Ranking Democratic Member 

Subcommittee on Aviation 
139 


Insert offset folio 126 here 80937A.126

ANN KIRKPATRICK 

11>1 O'STRICT>AII!~OtM 

VETERANS' AFFA!RS COMMlTIEE SV!jCOMMln€~s 

RANKING MliM6€R. OVEl'lSI('\"''' AND iN"FSTIG"'TIONS 

ECONOMIC OPf'Q'lTl.JNITY 

(,ongress of tbe Wniteb ~ta:tes 

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1!llIta!ilJington, :11:\11[: 20515-0301 

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211 NOAfflFLOfI"ENCESTF\fiH#1 

CASA GIlANO~. AZ85122 

11555 WriST CNIC CfiNT~R DAIIffi #1MA 

MARANA., AZ S5653 

550 NOltTM9TH PtACF. 

SHOW lOW, AZ 85901 

1400 EAST ASH 

Congresswoman Ann Kirkpatrick >t K . O'A~.'"'' . Questions for the Record I ,0q 

May 17,2013 I 

FAA Modernization and Reform Act Implementation 

Question for Administrator Huerta 

I would like to acknowledge the hard work the 

FAA has put into the UAS test site program this 

past year. The SIR Volumes are quite detailed and 

impressive; I am sure they will lead to selection of 

six highly professional test ranges and I appreciate 

the opportunity for my state, Arizona, to 

participate in this critically important process. The 

2012 Act had finite time lines for the operation of 

the 6 UAS Test Ranges, with 2017 as the range endyear, The important additional time it took to 

address range needs and now privacy concerns 

has contributed to a revision in the original starting 

timeline, If the Six UAS test ranges are selected 

by the end of 2013 and become operational 180 

days into 2014, do you anticipate that the 2017 

timeframe would afford the six ranges sufficient 

time for a comprehensive research plan and data 

collection to be fully executed? 
140 

Æ 


Insert offset folio 127 here 80937A.127

The House Committee on Transportation and Infrastructure's Subcommittee 

on Aviation 

Hearing on Review of FAA's Implementation of the FAA Modernization and 

Reform Act 

Thursday, May 16,2013 

Questions for the Record for FAA Administrator Michael Huerta 

Ann Kirkpatrick - Arizona 1st District 

Unmanned Aircraft Systems (UAS): 

OUESTION: 

I would like to acknowledge the hard work the 

FAA has put into the UAS test site program this 

past year. The SIR Volumes are quite detailed and 

impressive; I am sure they will lead to selection of 

six highly professional test ranges and I appreciate 

the opportunity for my state, Arizona, to 

participate in this critically important process. The 

2012 Act had finite timelines for the operation of 

the 6 UAS Test Ranges, with 2017 as the range endyear. The important additional time it took to 

address range needs and now privacy concerns 

has contributed to a revision in the original starting 

timeline. If the Six UAS test ranges are selected 

by the end of 2013 and become operational 180 

days into 2014, do you anticipate that the 2017 

timeframe would afford the six ranges sufficient 

time for a comprehensive research plan and data 

collection to be fully executed? 

ANSWER: 

UAS industry and academia will conduct research at the test sites and will 

therefore be responsible for research planning and data collection within the time 

frame of the program.