Future of Aviation Advisory Committee

Record of Meeting

December 15, 2010

United States Department of Transportation Headquarters

Washington, DC

1

Public Announcement

The U.S. Department of Transportation (DOT), Office of the Secretary of Transportation, announced to 

the public this Future of Aviation Advisory Committee (FAAC) meeting in a Federal Register notice 

published November 24, 2010 (75 FR 71789).

Committee Members in Attendance

Name Affiliation(s)

Susan Kurland

(Committee Chair)

Assistant Secretary for Aviation 

and International Affairs

DOT

Juan J. Alonso Associate professor, Department of 

Aeronautics and Astronautics 

Stanford University 

Susan M. Baer Director, Aviation Department Port Authority of New York & 

New Jersey (PANY/NJ)

David Barger President and 

Chief Executive Officer

JetBlue Airways Corporation

(JetBlue)

Bryan K. Bedford Chairman, President and 

Chief Executive Officer

Republic Airways Holdings, Inc. 

(Republic Airways)

Severin Borenstein Professor, Haas School of 

Business

University of California, Berkeley 

(Haas School of Business)

Thella F. Bowens President and 

Chief Executive Officer

San Diego County Regional Airport

Authority

John M. Conley International Administrative 

Vice President and Air Transport 

Division Director

Transport Workers Union of America

(TWU), American Federation of 

Labor and Congress of Industrial 

Organizations (AFL-CIO)

Cynthia M. Egnotovich Segment President, 

Nacelles and Interior Systems

Goodrich Corporation (Goodrich)

Patricia A. Friend International President Association of Flight Attendants

(AFA)–Communication Workers of 

America (CWA), AFL-CIO

Robert L. Lekites President United Parcel Service Airlines (UPS)

Ana McAhron-Schulz Director of Economic and 

Financial Analysis

Air Line Pilots Association, 

International (ALPA)

William J. McGee Travel and Aviation Consultant Consumers Union

Daniel McKenzie U.S. Airlines Research Analyst Hudson Securities, Inc.
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Washington, DC

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Name Affiliation(s)

Jack J. Pelton Chairman, President, and 

Chief Executive Officer

Cessna Aircraft Company (Cessna)

Nicole W. Piasecki Vice President, 

Business Development

Boeing Commercial Airplanes 

(Boeing)

Raul Regalado President and Chief Executive 

Officer

Metropolitan Nashville Airport 

Authority

Glenn F. Tilton Chairman United Continental Holdings, Inc.

Christopher J. Williams Chairman and Chief Executive 

Officer

The Williams Capital Group

Other Officials Present

Name Affiliation(s)

Pam Hamilton 

(Designated Federal 

Official (DFO))

Director of Rulemaking Federal Aviation Administration 

(FAA)

Ray LaHood Secretary DOT

John Porcari Deputy Secretary DOT

Randy Babbitt FAA Administrator FAA

Background and Welcoming Remarks

This is the record of the fifth meeting of the FAAC, a Federal advisory committee formed pursuant to 

and subject to the requirements of the Federal Advisory Committee Act (FACA) Title 5, U. S. Code

Appendix 2 (2007). Ms. Pamela Hamilton, FAA Director of Rulemaking, called the meeting to order 

at 9:39 a.m. and welcomed the committee members and public in attendance. She introduced 

Ms. Susan Kurland, FAAC Committee Chair.

Ms. Kurland stated the committee began its work 7 months ago, after Mr. Ray LaHood, DOT 

Secretary, charged the FAAC with identifying concrete recommendations for meaningful changes on 

which the DOT, Congress, and other stakeholders could immediately act. She added the purpose of 

this meeting is to complete the task.

Ms. Kurland introduced and welcomed Mr. John Porcari, DOT Deputy Secretary. She summarized 

Mr. Porcari’s duties and credentials. Mr. Porcari thanked Ms. Kurland and the committee. He stated 

from the beginning, he and Secretary LaHood had high hopes and expectations for the committee’s

work, adding the committee is composed of a diverse group of experts doing important work for the 

aviation industry, its workforce, and consumers.
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Mr. Porcari explained that the committee will continue discussing how to ensure the U.S. aviation 

industry’s competitiveness, sustainability, and safety. He noted the FAAC is not about the government 

dictating its position but about the committee advising the government. Mr. Porcari listed the 

committee’s areas of concern: ensuring safety, sustaining a world-class aviation workforce, balancing 

the industry’s competitiveness and viability, securing stable funding for aviation systems, and 

addressing the industry’s environmental challenges.

Mr. Porcari emphasized Secretary LaHood’s instructions for the committee to produce a useful report. 

He added the Secretary wants practical, implementable, and commonsense recommendations leading to

meaningful changes. Mr. Porcari stated he and Secretary LaHood are eager to hear the committee’s 

recommendations. He emphasized after today’s recommendations the real work begins. Mr. Porcari 

thanked committee members for their enthusiasm and hard work and stated he looks forward to 

working together on the next steps.

Ms. Kurland stated the committee has a full agenda today. She asked Ms. Hamilton to read the 

FACA requirements. Ms. Hamilton explained the committee’s requirements concerning objectiveness 

and public accessibility. She added that meeting minutes will be available both in the regulatory 

docket established for this committee and on the FAAC Web site at http://www.dot.gov/faac.

Ms. Hamilton read the formal statement required under the FACA and listed the safety and security 

guidelines for the attending members of the public. She then asked to ratify the meeting minutes from 

the October 20, 2010, FAAC meeting, and solicited any comments or corrections to the meeting 

minutes. There were no comments or corrections. On motion, duly seconded, Ms. Hamilton ratified 

the meeting minutes.

Ms. Kurland introduced the FAAC members and summarized the committee’s progress. She stated the 

FAAC began by identifying five areas of interest for consideration in deliberations: (1) safety, 

(2) competitiveness, (3) the environment, (4) financing, and (5) workforce.

Ms. Kurland listed previous committee meetings and summarized the purpose of each:

 May 25, 2010—Members discussed critical issues facing the aviation industry and formed 

subcommittees for five issues.

 July 14, 2010—Each subcommittee chair broadly identified their focus areas.

 August 25, 2010—Members heard presentations from subject matter experts (SME) to enhance 

understanding of topics and reached consensus on the subcommittees’ five focus areas.

 October 20, 2010—The subcommittees presented options for dealing with respective issues to 

the full committee.
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Ms. Kurland stated the committee will vote on the final recommendations this morning and will present 

the recommendations to Secretary LaHood this afternoon.

Ms. Kurland reviewed the day’s agenda. She explained subcommittee chairs will present their 

recommendations to the full committee in the morning, who will then vote on the adoption of those 

recommendations. Ms. Kurland continued, stating Secretary LaHood and Mr. J. Randolph Babbitt, 

FAA Administrator, will join the committee for the afternoon session to hear the final 

recommendations.

Ms. Kurland further commented on recommendations on which the subcommittees failed to reach 

consensus. She explained the committee will include a description of those issues in its final report 

recognizing the importance of the unresolved issues. Ms. Kurland then turned the meeting over to the 

chair of the Environment Subcommittee.

Environment Subcommittee

Mr. Bryan K. Bedford, Republic Airways, Subcommittee Chair, reported on the 

Environmental Subcommittee. He thanked all the committee members and Ms. Lynne Pickard, DFO,

for their hard work and dedication.

Mr. Bedford noted many of this subcommittee’s recommendations touch upon work done by all the 

subcommittees over the last 7 months. He stated there is not a single solution for the environmental 

challenges, nor is there a unified global standard on emissions targets. Mr. Bedford added he believes 

the recommendations present some reasonable and realistic goals.

Mr. Bedford noted the subcommittee did apply cost-benefit analysis when evaluating the environment 

recommendations. He stated reducing aviation’s environmental impact is a daunting task, and his 

belief is this is a unique opportunity for the United States to take an international position of leadership 

on environmental sustainability, develop key technologies, and create thousands of future jobs.

Mr. Bedford stated the subcommittee’s four recommendations aim to achieve carbon-neutral growth 

from 2020 onward, with a long-term goal of 50 percent reduction of aviation carbon emissions by 

2050. He presented the following four recommendations for Secretary LaHood’s consideration:

1. Exercise strong national leadership to promote and highlight U.S. aviation as a first user of 

sustainable alternative fuels. This would involve increased coordination and enhancement of 

government and industry efforts to pool resources, overcome key challenges, and take actions.

These would also include promoting the use of alternative aviation fuels through certification, 

funding, commercial production and deployment, ―book and claim‖ crediting, and international 

and domestic acceptance. The DOT should take a lead role within the Biofuels Interagency 

Working Group and provide increased support to FAA’s alternative fuels work.
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Mr. Bedford pointed out this recommendation could reduce annual aviation industry lifecycle 

carbon-neutral emissions by 5 percent by the end of the decade.

2. Accelerate aircraft technology development with more robust research and development by 

government and industry. Seek the permanent extension of industry research and development 

tax credits. Seek significant increases in funding to programs such as the FAA’s Continuous 

Lower Energy, Emissions, and Noise (CLEEN) technology program, and continue to advocate 

close coordination with National Aeronautics and Space Agency aeronautical research programs 

to develop aircraft technologies.

Mr. Bedford stated historically, the aviation industry has been able to sustain a 1.5 percent annual 

improvement in aircraft fuel efficiency due to new generation aircraft airframe, engine technologies, 

and operating practices. He noted if the aviation industry is to achieve the long-term greenhouse gas 

emission reduction goals, it needs to develop a step-change function in airframe and engine design. 

Mr. Bedford added given the necessary lead times, these new technologies and designs would require

implementation by the end of the decade in order to meet the goals by 2050.

3. Advocate for substantial additional targeted investment to accelerate equipage elements of the 

Next Generation Air Transportation System (NextGen) that have significant near-term benefits 

and an increased likelihood of successful deployment. Aim for deployment of accelerated 

equipage within the next 4 years. Establish a ground taxi delay management pilot program and 

recommend appropriate deployment within 3 years of taxi delay management methodology for 

U.S. airport operations. Begin an airport energy efficiency and emissions reduction program to 

reduce emissions from airport power sources and increase energy efficiency at airports.

Mr. Bedford noted research consistently suggests that implementing the components of NextGen can 

reduce greenhouse gas emissions by as much as 12 percent. He asserted an obstacle is the debate on 

who should pay for air traffic control (ATC) modernization, but concluded everyone from the industry 

to the consumers are paying for the lack of this modernization. Mr. Bedford stated his subcommittee 

strongly recommends the Secretary champion an accelerated timeline for the implementation of 

NextGen which users can pay for once it has become operational.

4. Lead an effort to align Federal aviation policy to support an aviation sector approach to 

carbon emissions. Building on the International Civil Aviation Organization (ICAO) resolution 

adopted on October 8, 2010, advocate for a coordinated global and domestic framework for 

aviation carbon dioxide emissions. It is important to set a strategic course for further 

international agreement through ICAO and follow with bilateral negotiations to secure the 

support of other countries. The Secretary should take advantage of industry assets to develop 

practical global implementation methods, such as the International Air Transport Association

members have already agreed to create an emissions inventory system—the basis for any 

measurement of emissions reduction progress. Such steps would enhance the confidence of the 

aviation industry to make investments in the technological, alternative fuel, infrastructure, and 

operational improvements necessary to meet greenhouse gas emissions targets and provide a 

harmonized approach among key aviation nations and markets around the world.
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Mr. Bedford noted the subcommittee fully supports the President’s plans to target Federal investment in 

the air carrier sector, specifically to accelerate NextGen deployment. He added research shows 

investment will yield significant return on capital in the form of reduced fuel burn, less time in the air, 

and less loss of productivity by the air carrier customers delayed by air traffic issues. Mr. Bedford 

suggested this would bring new job opportunities in NextGen and development of commercial aviation 

alternative fuels along with enhancements to research and development that would aid in extending our 

international technology leadership. He stated this work in aviation alternative fuels would benefit 

multiple sectors such as providing United States farmers opportunities to grow non-fuel competing 

feedstock without adverse consequences to the domestic food supply.

Mr. Bedford added the United States has a unique opportunity to invest in these sectors and not only 

take a leadership role in environmental sustainability, but also leadership positions in technologies 

which will lead to greater energy independence, security, and the creation of new jobs for 

future generations.

Mr. Bedford yielded the floor to Ms. Kurland who summarized the four recommendations and took a 

vote on each one to the full FAAC. The full FAAC adopted all four of the recommendations with no 

dissenting votes.

Subcommittee on Financing

Ms. Kurland turned the meeting over to Mr. Jack Pelton, Subcommittee on Financing chair, Cessna. 

Mr. Pelton thanked the Subcommittee on Financing members for their active participation and 

meaningful discussions, and Mr. John Hennigan, DFO, for his support.

Mr. Pelton indicated the committee developed four recommendations.

1. Extend the alternative minimum tax (AMT) exemption for airport private activity bonds 

for 4 years.

Mr. Pelton noted most commercial airports are publicly owned and operated. He stated the problem 

and challenge with this issue is that private activity bonds issued to fund airport improvement projects 

are subject to an AMT on the interest payments to bond holders. As a result, investors require higher 

interest rates on these bonds to offset the taxes. Mr. Pelton discussed the benefits of the current two 

year tax holiday from the AMT on airport private activity bonds. He explained the tax holiday expires 

at the end of 2010. Mr. Pelton recommended the Secretary of Transportation support 

Federal legislation to extend AMT relief for 4 years. He stated the committee would help and 

support the Secretary as necessary to achieve permanent AMT relief for airport private activity 

bonds. Mr. Pelton stressed the exemption will lower airports’ costs and support growth of 

aviation infrastructure.
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2. Provide funding to accelerate equipage of aircraft for NextGen.

Mr. Pelton indicated there are three challenges in modernizing ATC systems and in-ground 

infrastructure. The first is historically, operators have equipped their aircraft early and realized no 

benefit due to slow FAA implementation. The second challenge is a weak business case for early 

equipage by some operators. Mr. Pelton added NextGen includes a philosophy shift to infrastructure 

installed in aircraft instead of on the ground, and the weak financial state of industry makes funding for 

new equipment difficult. He stated the third challenge is potential difficulty for the aviation industry to 

accelerate NextGen equipage because of competing financial commitments.

Mr. Pelton stated the Subcommittee on Financing believes the Federal Government should help fund 

this equipage and there should be varied financial structures including grants, loans, and leases. He 

continued by noting the associated costs and benefits will be shared between public and private 

partners. Mr. Pelton added there was not complete consensus on this issue with one dissent.

3. Deliver the benefits of NextGen.

Mr. Pelton attested there are large investments that are required for owners and operators to implement 

NextGen. He stated the committee believes the FAA must do a better job by delivering immediate 

benefits when the industry equips its aircraft. Mr. Pelton also noted the FAA must focus on the aircraft 

that are already equipped and deliver benefits to them now. He explained the subcommittee is asking 

the Secretary to ensure the FAA delivers the operational capability and technology for the industry to 

receive the benefits of NextGen as quickly as possible, and to require the FAA to develop and commit 

to a timetable of when components of NextGen will be implemented and available and required 

training and approvals will be in place.

4. Review of eligibility criteria for Airport Improvement Program (AIP) and Passenger Facility

Charge (PFC) programs and funding requirements for these programs.

Mr. Pelton stated the airports community wants to broaden the criteria for these programs because the 

program eligibility might be out of date. He continued by explaining AIP and PFC dollars might be 

used to invest in NextGen technologies to improve the airports’ capabilities. Mr. Pelton stated the 

subcommittee’s recommendation is the FAA should review and redefine the term ―aviation 

infrastructure.‖ He noted the FAA would do as much as possible of any decided-upon updates 

administratively and develop legislative recommendations for the Secretary for the remainder of the 

suggested changes. Mr. Pelton added there were two constituencies with strong opinions on this topic. 

He stated the airports community believes these eligibility criteria changes must be accompanied by 

increases in AIP and PFC funding levels, and the air carrier community believes more flexibility is 

possible without making these increases. The FAA should determine and make recommendations on 

whether AIP levels and PFC charges need to be adjusted based on eligibility criteria changes.

Dr. Severin Borenstein, University of California, Berkeley, Haas School of Business, dissented on the 

second recommendation stating his belief that government subsidization of aircraft equipment is not 

prudent in these times of extremely tight Federal budgets. He noted he did not see evidence in the 
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recommendation to prove this funding is necessary. Dr. Borenstein also noted he filed a longer dissent

to be included in the FAAC final report.

Ms. Susan Baer, PANY/NJ, asked for clarity on the fourth recommendation. Mr. Pelton noted that the 

recommendation includes only reviewing and revising the criteria, not changing the actual funding 

levels.

Mr. Raul Regalado, Metropolitan Nashville Airport Authority, stated he thought increased AIP and 

PFC funding had not been included as a part of the recommendation, but it later states in the 

recommendation that the FAA should review funding. Ms. Kurland turned to Mr. Pelton who 

explained the recommendation suggests a review of the criteria and a second action for the FAA to 

consider reviewing funding levels based on eligibility criteria changes.

Dr. Juan Alonso, Stanford University, made a statement on the second recommendation. He explained 

his position that the committee is voting on a recommendation to expedite aircraft equipage, not voting 

on how or if it should be funded by the government. Dr. Alonso stated he did not think the committee 

needed to vote on specifics and asked Dr. Borenstein if this allayed his concerns with the 

recommendation in any way. Dr. Borenstein stated the recommendation is explicitly worded to include 

government funding of NextGen equipage on aircraft, and that is the point on which he is basing his 

dissent.

Ms. Kurland called for a vote on the four recommendations. She summarized the four 

recommendations and took a vote on each to the full FAAC. The FAAC adopted recommendations 

one, three, and four with no dissenting votes. The second recommendation, funding accelerated 

equipage of aircraft, had one dissent by Dr. Borenstein. Ms. Kurland noted all the recommendations

were adopted.

Subcommittee on Competitiveness and Viability

Ms. Kurland turned the meeting over to Mr. Glenn Tilton, United Continental Holdings, Inc., to present 

the recommendations proposed by the Subcommittee on Competitiveness and Viability 

(Competitiveness Subcommittee). Mr. Tilton reflected Secretary LaHood had sought recommendations 

that would allow the aviation industry to thrive and compete globally. He stated the economic health of 

the industry is essential to the health of the overall economy.

Mr. Tilton stated the Competitiveness Subcommittee had reached consensus on proposed 

recommendations for—

 Global competitiveness,

 Aviation taxation,

 Jet fuel price volatility,
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 Passenger and community access challenges, including reform of the essential air service 

(EAS) program,

 Development of a national intermodalism policy, and

 Transparency in consumer information.

Mr. Tilton stated the leads of each working group would summarize their respective proposals and 

respond to questions or comments by the committee.

Transparency in Consumer Information

Mr. William McGee, Consumers Union, discussed the proposals about passenger and community 

access challenges and transparency. He stated the subcommittee, with the assistance of DOT 

representatives, had found a middle ground between viewpoints on passenger protection issues. 

Mr. McGee stated the subcommittee agreed greater transparency is needed in these areas:

 Air carrier pricing, particularly with respect to ancillary fees for carriage of checked 

baggage and other services

Mr. McGee stated there was disagreement whether such services are truly optional. He added 

the objective is to ensure consumers booking air travel through any sales channel are aware of 

the total price.

Mr. McGee noted this issue may be addressed, to some extent, by a pending DOT rulemaking. 

He complimented Secretary LaHood on adopting a proactive stance on passenger protections, 

but stated the provisions of the proposed rules can be extended to further safeguard 

passengers’ rights.

 Flight operations

Mr. McGee stated there is a perceptual difference between government, industry participants,

and consumers about code-sharing and marketing agreements, particularly with regional 

operations. He noted regional partners of network air carriers now conduct more than 

50 percent of domestic departures. Mr. McGee stated the DOT differentiates between 

network air carriers and their regional partners using operating certificates, but marketing of 

such air carriers under unified brands may lead to confusion among consumers about the entity 

operating a given flight.

 Air carrier contracts of carriage

Mr. McGee stated air carrier contracts of carriage have become a confusing topic. He added a 

recent study by Consumers Union concluded such contracts of carriage are frequently difficult 

to locate on air carriers’ Web sites. Mr. McGee also noted the language of such contracts is

often legalistic, vague, and offers little practical information to consumers.
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 Monthly Air Travel Consumer Report

Mr. McGee stated the DOT’s monthly Air Travel Consumer Report has been an extremely 

valuable tool for consumers interested in comparing the performance of air carriers. He noted

the fragmentation of reporting between certificate holders marketed under a single brand may 

present incomplete or confusing information to consumers, diluting the value of the report.

Mr. McGee noted realignment of the monthly report to clearly present information across 

brand divisions would generally not require significant expense or effort on the part of 

air carriers, although it would subject some smaller regional carriers not currently required to 

submit information to reporting requirements.

Development of a National Intermodalism Policy

Mr. Tilton turned the discussion over to Ms. Baer and Dr. Borenstein to present the proposals on 

intermodalism and EAS. Ms. Baer stated there has been substantial discussion of intermodalism, but

little practical application. She reported the Competitiveness Subcommittee seeks a fresh examination 

of the benefits and opportunities offered by an intermodal approach. Ms. Baer stated the subcommittee 

proposes a recommendation that DOT explore opportunities to use non-aviation transportation modes 

to serve EAS-eligible communities. She noted that while intermodal efforts tie into a discussion of 

EAS, they also present a basis for actions separate and independent from EAS.

Ms. Baer stated the subcommittee also proposes recommending legislation requiring any new 

infrastructure initiatives consider components linking airports to other modes of transportation. She

stressed modernization of the nation’s ATC system remains the highest priority and stated no funds 

should be diverted from that objective to serve intermodal initiatives. Ms. Baer stated the 

subcommittee proposes recommending the creation of a task force to identify and remove barriers to 

intermodalism, to permit the most efficient movement of passengers and goods possible.

Essential Air Service

Dr. Borenstein noted the purpose of creating the EAS program was to prevent disruption of air carrier 

service to small communities following deregulation of the air carrier industry in 1978. He stated the 

subcommittee has determined, in many cases, continuation of EAS in its current form represents an 

inefficient use of Federal funds because of the availability of alternative means of transportation.

Dr. Borenstein stated the subcommittee proposes recommending, as an interim measure, the DOT limit 

communities in the contiguous 48 states eligible for air service subsidies under EAS to those receiving 

subsidies on a specified date. He added the subcommittee further proposes updating the criteria for 

EAS eligibility to recognize some communities can be served more efficiently by intermodal 

alternatives or by larger airports reasonably accessible by automobile.
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Ms. Thella Bowens, San Diego County Regional Airport Authority, expressed support for the 

subcommittee’s recommendations on intermodalism. Ms. Patricia Friend, AFA-CWA, requested the 

FAAC note as part of its recommendations on EAS, the Competitiveness Subcommittee proposes the 

Secretary quickly implement its recommendations on intermodalism. She noted, although the 

recommendations on EAS and intermodalism are separate, they are closely intertwined 

and interdependent.

Mr. McGee acknowledged the need for reform of the EAS program, but stressed to the FAAC the 

Competitiveness Subcommittee believes EAS continues to provide value to the markets where it is 

most needed, particularly in rural areas and in Alaska.

Jet Fuel Price Volatility

Mr. Tilton turned discussion over to Mr. Daniel McKenzie, Hudson Securities, Inc. Mr. McKenzie 

stated, following vigorous discussion the subcommittee had reached consensus on jet fuel price 

volatility and taxation.

Mr. McKenzie stated, given the importance of jet fuel price stability to the air carrier industry, the 

subcommittee proposes recommending Secretary LaHood—

 Continue to participate in the United States Commodity Futures Trading Commission (CFTC) 

rulemaking process implementing the provisions of the Wall Street Reform and Consumer 

Protection Act that—

o Set aggregate position limits on speculative trading and

o Require derivatives to trade on exchanges with real time reporting.

 Communicate to the CFTC the economic stresses imposed on the air carrier industry by jet fuel 

price volatility.

 Support responsible regulatory intervention to reduce jet fuel price volatility attributable to 

speculative activities, provided the CFTC concludes such activities have played a significant 

role in price volatility.

Mr. McKenzie noted volatility in the availability and price of jet fuel may result from disruptions in 

production and distribution in addition to fluctuations in oil prices. He stated, as a result, the 

subcommittee proposes a recommendation that Secretary LaHood commission a study of the state of 

the nation’s on- and off-airport downstream infrastructure for storage and distribution of jet fuel.
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Taxation

Mr. McKenzie noted the tax burden on a typical $300 domestic round trip ticket has nearly tripled, 

from $22 in 1972 to $61 in 2010. He stated the subcommittee had identified 17 Federally sanctioned 

taxes and fees, totaling $16 billion annually, applicable to the aviation industry. Mr. McGee reported 

these taxes and fees come from six Federal agencies under three different cabinet level departments. 

Mr. McKenzie stated in 1990, the industry was only subject to six such taxes and fees, totaling 

$3.7 billion.

Mr. McKenzie stated the subcommittee had reached consensus on a proposed recommendation that 

Secretary LaHood commission an independent analysis to determine if existing levels of aviation taxes 

and fees sufficiently balance the DOT’s statutory mandates to ―...encourage efficient and 

well-managed air carriers to earn adequate profits and attract capital...‖ and ―...promot[e], 

encourag[e], and develop civil aeronautics and a viable, privately-owned United States air transport 

industry....‖.

Mr. McKenzie stated the subcommittee further proposes recommending, based on the results of the 

proposed analysis, Secretary LaHood pursue appropriate legislative and regulatory actions to ensure 

existing and future taxes and fees applied to passengers, air carriers, and general aviation are effective 

and collected efficiently. He also stated, under the subcommittee’s proposal, the analysis would 

include input from aviation stakeholders and independent economists, and would address the

following questions:

 How the level of aviation taxes imposed on the U.S. aviation industry compares to those on 

other modes of transportation;

 Whether the existing level of aviation taxes and fees is levied efficiently and effectively for the 

services provided by the Federal Government;

 Whether regular consultation between the departments and agencies that administer aviation 

taxes and fees would result in a more efficient and rational aviation tax system; and

 What the appropriate balance is between General Fund financing and Airport and Airway Trust 

Fund financing of capital and operating costs of the national airspace system.

Global Competitiveness

Mr. Tilton addressed the subcommittee’s proposals about global competitiveness of the aviation 

industry. He noted transactions and occurrences such as mergers, proposed mergers, DOT approval of 

several immunized ventures and global alliances, and the successful negotiation of additional 

open skies agreements, had altered the competitive landscape of the air carrier industry since the 

formation of the Competitiveness Subcommittee. Mr. Tilton stated the subcommittee believed its 

proposals on global competitiveness were both timely and responsive to its mandate.
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Mr. Tilton stated the subcommittee had identified specific policy actions the DOT should take to carry 

out its existing statutory mandate to promote a healthy U.S. air carrier industry and strengthen the 

competitive position of U.S. air carriers in global markets, including—

 Further expanding open skies initiatives with primary focus on the fastest growing 

global markets.

 Eliminating artificial barriers to competition in the global marketplace.

 Updating and reaffirming the 1995 Statement of U.S. International Air Transportation Policy.

 Acknowledging the importance of global alliances, and, when considering proposed alliances, 

placing greater weight on the DOT’s existing statutory mandate, including—

o Strengthening the competitive position of U.S. air carriers to at least ensure equality with 

foreign air carriers and

o Maintaining and increasing U.S. air carrier profitability in foreign markets.

 Leveraging Secretary LaHood’s recent appointment to the President’s Export Promotion 

Council to expand the DOT’s role in promoting United States aviation exports. Mr. Tilton 

noted the close tie between exports and aviation, and aviation contributes to international trade 

more than any other industry.

Mr. Tilton offered thanks to the members of the Competitiveness Subcommittee, to the FAAC, and to 

DOT and FAA representatives assisting the FAAC and its subcommittees for their efforts. He then

turned the meeting over to Ms. Kurland.

Ms. Kurland summarized the recommendations proposed by the Subcommittee on Competitiveness and 

Viability and requested the FAAC’s vote on each of them. Each recommendation was unanimously 

approved for adoption.

The FAAC paused for a break at 10:55 a.m. and resumed at 11:23 a.m.

Labor and World-class Workforce Subcommittee

Ms. Kurland introduced Ms. Friend. Ms. Friend thanked the DOT and the FAA staff for their support 

throughout the process. She also thanked the subcommittee members for their thoughtful discussion 

throughout the meetings, especially for working through the tough topics.
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Ms. Friend explained the subcommittee had formulated three recommendations, the first focusing on 

the development of the workforce of the future. She stated there is general recognition the 

United States needs improved access to science, technology, engineering, and math (STEM) education 

in order to meet the challenges of the future. Ms. Friend reported the recommendation has not changed 

since the FAAC meeting in Los Angeles, California. She mentioned workforce development should be 

a top tier initiative of the DOT in order to develop, oversee, coordinate, implement, and integrate a 

strategic plan that includes a STEM education program and activities.

Ms. Friend added the recommendation includes increasing outreach to educational institutions to raise 

visibility of aviation and aerospace engineering programs. She stated the recommendation encourages 

the initiation of programs that give students hands-on experience applicable to the aviation industry.

Ms. Friend commented the DOT and the Department of Labor should work together as integral parts of 

the Interagency Revitalization Task Force to implement a national strategy focused on recruiting, 

training, and cultivating an aviation workforce. She also stated the DOT and Department of Education 

should work together to create a state of the art STEM education program that will build a career-ready, 

STEM-literate workforce.

Ms. Bowens stated the recommendation supports the integration of STEM activities with other 

stakeholders in the industry focused on the same initiative. Ms. Cynthia Egnotovich, Goodrich, added 

the subcommittee believes there is a great deal of work done already and promoting STEM education 

will help to coordinate those efforts.

Ms. Friend stated the second recommendation deals with the state of labor-management relations. She 

added the current relationship between labor and management representatives is not effective, and as a 

result, there is a considerable amount of distrust between the groups. Ms. Friend noted there is an 

inability to accomplish negotiations or reach agreements that would benefit all stakeholders, lead to a 

better workplace, provide workers with dignity and respect, and stabilize the industry. She mentioned 

there are many reasons for the current state of labor management relations, but rather than focusing on 

history, the recommendation focuses on how to improve the situation.

Ms. Friend further explained the second recommendation covers how the National Mediation Board 

(NMB) can contribute to improving the relationship between labor and management in the aviation 

industry. She stated in September 2009, the NMB established an independent joint labor-management 

committee to help improve collective bargaining, mediation process, and the delivery of mediation 

services. Ms. Friend reported the NMB issued a report, known as Dunlop II, in April 2010. She added 

the recommendation urges the Secretary of Transportation to support and urge the NMB to quickly 

adopt the recommendations in Dunlop II and ensure the NMB obtains adequate funding to implement 

Dunlop II. Ms. Friend stated the subcommittee recognizes the NMB cannot resolve 

labor-management relations alone, and members of the aviation industry must be proactive in fostering 

a workplace environment that provides stability for all involved.
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Ms. Friend stated the third recommendation is for Secretary LaHood to endorse and implement a 

semiannual workforce management conference beginning in September 2011. She reported the 

purpose of the conference is to bridge the gap of information and understanding between the workforce 

and management. Ms. Friend explained the subcommittee recognizes there are multiple emotional and 

contentious issues facing the workforce. She stated there is value in exploring these problems through 

continued discussion that may lead to a greater understanding of the issues as well as potentially reach 

consensus. Ms. Friend mentioned the issues include foreign repair stations, job outsourcing, 

foreign ownership, entry standards, and continued fitness standards. She asserted the subcommittee 

was unable to reach consensus on these topics, but did document their opinions on bankruptcy code, 

human rights conventions, and entry standards. Ms. Friend encouraged Secretary LaHood to review 

these papers and take note of the subcommittee’s concerns.

Mr. McKenzie commented on the bankruptcy code and stated when an air carrier files for bankruptcy it 

typically has run out of cash. He expressed concern the change of bankruptcy legislation could lead to 

the liquidation of an air carrier, rather than stabilization. Ms. Friend added the revision of bankruptcy 

code is not a formal recommendation; rather, it is a topic for greater discussion.

Mr. Bedford inquired if there was any discussion of baseball-style arbitration as a solution for the labor 

management relations problem. Mr. Lekites stated Dunlop II outlines the preparation of parties, the 

expectations of management, and labor standards. He asserted the NMB helps to facilitate training on 

how to negotiate and Dunlop II is the guideline for the process. Ms. Friend added the current process 

does include a possibility for a presidential emergency board. She noted while Dunlop II does not 

include baseball-style arbitration, it does include the opportunity for non-negotiated resolution.

Mr. Regalado inquired about the terminology for the aviation workforce in recommendation three. He 

stated the term aviation workforce is very broad, and would include air carriers, airports, and general 

aviation. Mr. Regalado added a gap does not exist between airport employees and airport management. 

He observed there should be clarification in the recommendation. Ms. Friend asserted the 

recommendation is to have Secretary LaHood issue invitations to the various areas of the industry. She 

stated those who are interested in engaging in the conversation are welcome to do so. Ms. Friend noted 

the conversation was very air carrier-centric; however, there may be issues in other areas of the aviation 

and aerospace industry.

Ms. Kurland stated the FAAC was ready to vote on the Labor and World-class Workforce 

Subcommittee recommendations. In turn, each recommendation was unanimously approved for 

adoption.

Ms. Kurland thanked Ms. Friend and the Labor and World-class Workforce Subcommittee for their 

hard work.

Aviation Safety Subcommittee

Ms. Kurland introduced the Aviation Safety Subcommittee and turned the meeting over to its chair, 

Ms. Nicole Piasecki, Boeing. Ms. Piasecki stated she was pleased to bring six recommendations to the 

Secretary of Transportation. She added there is strong consensus among the subcommittee members on 
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all six recommendations. She thanked Mr. Fazio, FAA, Mr. Steve Predmore, JetBlue, 

Mr. Paul Feldman, GAMA, Mr. Arnie Konheim, DOT, and Mr. Dan Grace, Cessna for their 

contributions to the subcommittee’s work.

Ms. Piasecki stated, as requested by the Secretary, the recommendations are strategic but actionable. 

She noted, given the strides in aviation safety over the last 2 decades, the subcommittee’s goal was to 

determine how to make further systemic improvements over the next 10 to 20 years.

Ms. Piasecki asserted that industry and governments have embarked on Safety Management Systems

(SMS) as an overall framework to make continuous and comprehensive improvements in safety. She 

also informed the committee that the FAA has embarked on a rulemaking process to require SMS

implementation at certificated air carriers in the United States. Ms. Piasecki continued by discussing 

the SMS culture and resultant safety responsibilities when implemented in an organization. 

Ms. Piasecki emphasized that the subcommittee’s task was to look for strategic improvements within 

the context of an industry already taking steps to implement SMS.

Ms. Piasecki noted improvements to safety in the past have revolved around collaborating with the 

government for data gathering and analysis. She continued by discussing the work of the 

Commercial Aviation Safety Team (CAST) in the late 1990s to achieve an 80 percent reduction in

accidents over a 10-year period. She stated procedural changes were implemented and the 80 percent 

goal was achieved by using comprehensive accident data and specific training technologies. 

Ms. Piasecki added that since then, the accident rate leveled. She observed the industry will still need 

to rely on data going forward, but the data will need different analysis.

Ms. Piasecki stated the safety community’s traditional approach could be described as forensic, but the 

approach now needs to be predictive. Ms. Piasecki indicated that using SMS principles, the industry 

has already started using proactive programs, such as Flight Operations Quality Assurance, the Aviation 

Safety Action Program, and the Aviation Safety Information Analysis and Sharing program. She 

explained the reports generated from these programs will be the backbone of future safety efforts. 

Ms. Piasecki added that SMS set the context of the subcommittee’s recommendations. 

Ms. Piasecki stated the subcommittee’s first recommendation states the Secretary of Transportation 

should seek comprehensive legal protections for voluntary and mandated SMS safety data programs 

and information to ensure their continued benefits to safety. She continued by explaining the Secretary 

should pursue legislative action to provide ongoing protection of safety information systems in the 

United States and work with Congress to quickly introduce such legislation. Ms. Piasecki discussed 

the benefits of legislative action, noting the need to ensure the free flow of safety data between all areas 

of the aviation industry. She stated this is necessary to determine causation and prevent recurrences in 

the future. Ms. Piasecki added the FAA needs to transition from accident diagnostics to 

prognostic prevention.

Ms. Piasecki discussed the need for comprehensive protection of data to ensure ongoing and robust 

data collection. She noted the industry stakeholders are threatened by use of data for civil or criminal 

litigation. Ms. Piasecki observed that enhancement of aviation safety with an SMS approach requires a 

free flow of safety data and ideas among organizations responsible for the design and operation of 
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aircraft. She concluded by stating development analysis and documentation will be inhibited if 

submitted data potentially could be used in media admonitions, criminal or administrative prosecution,

or civil litigation. 

Ms. Piasecki delivered the Aviation Safety Subcommittee’s second recommendation as beginning with 

the fiscal year 2012 budget for the FAA. She explained the Secretary should supply focus, priority, and 

resources to develop improved tools and methods for providing predictive safety risk discovery 

capabilities for the aviation system. Ms. Piasecki explained these tools will enhance the ability to 

identify risks of future accidents and require application by both the industry and government so the 

safety initiatives can be proactively implemented. Ms. Piasecki noted modeling and simulation 

capability must be developed and used in parallel, and this will require resources and technology 

beyond what is currently in place. 

Ms. Piasecki then described the third recommendation, which states the Secretary and 

FAAAdministrator, working with aviation system partners and other groups, should identify new and 

potentially valuable sources of safety data. She added the Secretary and FAA should establish criteria 

for identifying and adding those sources to data sharing efforts. Ms. Piasecki noted safety can be 

increased by identifying additional participants or stakeholders for aviation rulemaking committees and 

voluntary safety programs. 

Ms. Piasecki discussed the subcommittee’s fourth recommendation and stated the Secretary should 

ensure safety performance standards and training are included in NextGen programs. She discussed the 

importance of NextGen in the subcommittee’s recommendations and the systematic implementation of 

NextGen and SMS. Ms. Piasecki noted that during the design and implementation of NextGen, 

government and industry must systematically manage the inherent risks of introducing new 

technologies. She finished by observing that steps are needed to ensure there are mechanisms to

identify risks.

Ms. Piasecki continued to the fifth recommendation, which urged the Secretary to review the existing 

regulatory calendar and provide parameters for the FAA to prioritize rulemakings. She indicated 

prioritizing rulemaking efforts should include industry input and be visible to the public. Ms. Piasecki 

added that the Secretary should review rulemakings and ensure they are in line with SMS philosophies 

and policies established by FAA headquarters. She discussed current rulemaking initiatives and means 

of identifying the aviation industry’s needs. Ms. Piasecki described a similar CAST review completed

in the early 1990s. She noted the benefits the recommended review could have on the industry,

including a refocus on top safety priorities and a more prompt rulemaking process. Ms. Piasecki 

expressed the subcommittee’s belief that this review will allow the FAA to move forward on efforts to 

enhance regulatory efficiency and effectiveness.

Ms. Piasecki discussed the sixth recommendation, on use of child restraint systems on aircraft. The 

subcommittee suggests—

 The Secretary should utilize all resources in his office to educate the public on dangers of flying 

with children sitting in the lap of an adult.
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 The Secretary should update all data on families flying with children sitting in the lap of an 

adult, including accidents and incidents involving injury and death.

 Based on the findings, the Secretary should take necessary actions.

Ms. Piasecki noted the only people not required to be fastened in a seat on an aircraft are children under 

2 years old. She observed this is a problem because the parents of these children lack knowledge about 

the potential dangers of children flying unrestrained and do not think this is a dangerous situation. 

Ms. Piasecki thanked Mr. McGee for keeping the child restraint issue before the subcommittee.

Ms. Piasecki reported there was subcommittee discussion on oversight of external and contract 

maintenance. She noted some members were concerned with the increasing use of contract

maintenance providers and whether the FAA has adequate resources and personnel to oversee these

maintenance providers. Ms. Piasecki stated other members of the subcommittee believe the current 

maintenance standards exceed the FAA standards. She explained the subcommittee could not reach 

consensus on a recommendation for this issue. Ms. Piasecki thanked the subcommittee and opened the 

floor for comments.

Ms. Kurland called for a vote by the FAAC on all six recommendations of the Aviation Safety 

Subcommittee. In turn, each recommendation was unanimously approved for adoption.

Ms. Kurland reported that the full panel of 23 recommendations has been adopted. 

She commended the committee for having a good discussion and noted that she and Mr. Porcari 

thanked the members for all of their work over the past 7 months. She indicated the committee has 

accomplished the tasks given to them by the Secretary. Mr. Porcari also stated the recommendations 

are exactly what the Secretary asked for: concise and actionable recommendations. Ms. Kurland turned 

to Ms. Pam Hamilton for information on lunch and housekeeping items. Ms. Hamilton moved for 

recess and lunch, there was a second, and lunch was approved.

The FAAC recessed for lunch at 12:03 p.m. and reconvened at 1:32 p.m.

Presentation of Recommendations

Ms. Kurland welcomed the committee members and attendees back from lunch, and noted Secretary 

LaHood and FAA Administrator Babbitt had joined the meeting. She introduced Secretary LaHood, 

giving a brief summation of his responsibilities as Secretary of Transportation and his experience prior 

to joining the DOT. Secretary LaHood thanked Ms. Kurland and expressed his appreciation to the 

FAAC members for their hard work and thoughtful input in forming the recommendations. He stated 

the health of the U. S. aviation industry has improved since the first FAAC meeting in May 2010, and 

this reflects the work by done by everyone in the industry. The Secretary asserted the collaborative 

work between the DOT and air carriers has been helpful, but there is work remaining. 

Secretary LaHood stated he was grateful for actionable recommendations from the committee. He 

stated the DOT would reach out to each of the FAAC members for their assistance moving the 
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recommendations forward. Secretary LaHood added the recommendations were important topics, and 

he looked forward to hearing the committee’s briefing.

Secretary LaHood recognized Ms. Kurland and Ms. Christa Fornarotto, DOT, for their work in leading 

the FAAC over the past 7 months. Ms. Kurland thanked the Secretary and asked Mr. Babbitt to address 

the committee. Mr. Babbitt thanked the members for their hard work and dedication, and recognized 

their personal commitment for participating in the FAAC in addition to their demanding full-time jobs. 

Mr. Babbitt stated the U. S. aviation industry continues to improve and will use the FAAC 

recommendations to continue to do so. He recognized the committee members for taking on tough 

issues and staying focused during discussions that ultimately produced actionable recommendations.

Mr. Babbitt thanked Ms. Kurland for her leadership of the FAAC, and recognized the important 

contributions of Ms. Hamilton for serving as the committee’s DFO, as well as other FAA personnel 

who assisted the committee with its work. Ms. Kurland thanked the Secretary and Administrator for 

their remarks.

Ms. Kurland began the presentation of the FAAC’s recommendations to Secretary LaHood, expressing

her belief that he would be pleased with the 23 recommendations from the committee. She noted the 

committee members and other attendees seated at the table had the full text of the recommendations 

and a summary document highlighting the recommendations would be shown on the video monitors 

throughout the meeting facility, for the benefit of the audience. This document is available as 

Attachment 1 to this record of meeting. Ms. Kurland read brief summaries of all 23 recommendations, 

and concluded by stating this was the official presentation of the FAAC’s recommendations to the 

Secretary of Transportation.

Secretary LaHood thanked the committee for the recommendations. He stated because he was not part 

of the discussions leading to creation of the recommendations, he would like to hear some of that 

discussion. Secretary LaHood began with Recommendation 23, Child Safety on Airliners, and asked if 

the FAAC believed the DOT should undertake rulemaking on this issue. Ms. Friend stated the 

committee was divided on the issue, with some members believing use of child restraint systems (CRS) 

on aircraft should be mandated, as recommended by the National Transportation Safety Board. She 

stated the FAA believes mandatory use of CRS would push some families to drive because of the 

increased cost of purchasing a seat for the child, subjecting the children to a more dangerous form of 

travel. Ms. Friend asserted her belief that this theory is unproven and based on outdated data, but for 

these reasons, the recommendation is not more firm.

Mr. McGee added the recommendation began as a proposal for a mandate, but evolved to at a 

minimum, continuous education of the flying public on the dangers of children flying unrestrained, and 

more action should be undertaken by the DOT if warranted by updated data. Mr. McGee stated he 

chaired a meeting in October 2010 with representatives from the FAA, NTSB, and the ATA, and no one 

in attendance would argue that a child flying in their parent’s lap is safer than in a CRS. He noted 

much of the data supporting diversion of families from flying to driving is quite old, and needs 

updating. Mr. Barger added that a more holistic approach from the air carrier industry and government 

is needed to better study this topic, as much work on this subject has already been done. 
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Secretary LaHood stated he was supportive of Recommendation 17, Workforce/Management 

Conference. He expressed a commitment to making this conference happen and including as many 

representatives as possible from labor and management.

Secretary LaHood noted that recommendations 12 and 13 concerned the EAS program. He stated there 

are concerns of too many airports in the program and asked the committee for further explanation. 

Dr. Borenstein explained he worked at the Civil Aeronautics Board in 1978, when the EAS program 

was created. He added the program has veered from its original intent, noting several cities currently in 

the program are within easy driving distance of larger airports with frequent air service. .Dr. Borenstein 

cited an example of one airport in the EAS being only 71 miles from a major airport. He asserted, 

based on discussions with DOT personnel who manage the program, that over 90 percent of the people 

in some EAS-subsidized communities fly out of nearby major airports instead of using the EASsubsidized service. Dr. Borenstein characterized some EAS subsidies as generating 10 cents of value 

for every dollar spent on subsidizing air service.

Dr. Borenstein continued by explaining the EAS program was originally planned to end after 10 years, 

but was first extended by Congress and then made permanent. He stated the committee did not dispute 

that there were communities to which this program is vital, but there are some cities in the program that 

do not need aid. Dr. Borenstein cited Hagerstown Regional Airport in Maryland as a specific example, 

stating this airport receives EAS subsidies but is within easy driving distance of Washington Dulles 

International Airport via major highways.

Ms. Baer stated the committee believes the intermodal aspect is tangential to the future of the EAS 

program, citing scheduled bus service used in a codeshare agreement with Continental Airlines between 

Newark Liberty International Airport and the Lehigh Valley International Airport in 

Allentown/Bethlehem, Pennsylvania. She noted many foreign countries heavily use intermodal 

transportation to link airports with cities and added her belief that intermodal transportation is an 

opportunity for cities in the EAS program to have new transportation options.

Ms. Friend explained the interlinked recommendations of intermodal transportation and EAS program 

requirements demonstrate the work done by the committee to reach consensus. She stated she was 

originally opposed to any reduction of air service to small communities, but after listening to testimony 

from SMEs and other committee members, she understood there were efficient alternatives to link 

communities through intermodal transportation. Ms. Bowens added the intermodal discussion is tied to 

EAS program cities and crucial to larger airports where physical infrastructure barriers block growth. 

She noted the topic of intermodal transportation historically has not been a popular subject to discuss in 

the airport community, but she believes intermodal transportation is the way of the future for 

airport growth.

Secretary LaHood asked the committee if the phrase ―transparency on pricing‖ in recommendation 11 

was in reference to the DOT’s recently released Passenger Protections notice of proposed rulemaking 

(NPRM). Mr. McGee acknowledged the uncertainties the NPRM faces during the process of 

development of a final rule and noted consumer advocacy groups were generally in favor of the 

proposed rule. He added there were areas of the rule he believed could go further. Mr. McGee 

expressed his belief that more work was needed on air carrier contracts of carriage, and more 
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specifically, areas of these contracts dealing with delays and cancellations. He clarified he was not 

referring to lengthy onboard delays addressed in the DOT’s Consumer Rule, but rather common delays 

and cancellations faced by passengers. Mr. McGee noted passengers in these situations are provided 

little information on their rights. 

Mr. McGee stated at a minimum, uniformity is needed in contracts of carriage to make passengers’ 

rights clearer, and more transparency is needed on code-share agreements so passengers have a clear 

understanding of which air carrier is operating their flight. He explained most passengers believe they 

are flying on the air carrier through which they purchased the ticket, when they may actually be flying 

on one of the air carrier’s partner regional air carriers or another air carrier altogether. 

Mr. McGee stated the expanded use of codeshare partnerships has diminished the reliability of the 

DOT’s monthly report on air carrier performance in areas of delays, cancellations, and mishandled 

baggage. He explained that ranking the air carriers individually masks the true performance of major 

air carriers because their partner regional air carriers are not included in the performance statistics, but 

rather ranked as another individual air carrier. Mr. McGee expressed concern that with regional 

air carriers flying approximately half of all flights conducted by major air carriers, the statistics for 

major air carriers appear better than actual, because many of their partner regional air carriers are

performing worse on delays, cancellations, and mishandled baggage.

Secretary LaHood expressed his belief that the Obama Administration would be pleased with the 

recommendations on environmental topics. He stated, although these are difficult topics on which to 

achieve consensus, they are in line with the President’s position.

Secretary LaHood stated he was in full agreement with the committee’s recommendations on NextGen. 

He recalled a conversation with Mr. Tilton discussing how to pay for NextGen improvements. 

Secretary LaHood noted since that time, many people within the aviation industry and Federal

government have begun to understand the importance of this issue and that funding needs to be 

available to air carriers to upgrade their aircraft. He expressed his belief that the Obama 

Administration is supportive of this topic and asked Mr. Babbitt for his input. Mr. Babbitt stated 

NextGen is a positive business case with clearly visible benefits and return on investment. He 

cautioned that NextGen suffers from a lack of public visibility, but added the FAAC’s 

recommendations would make a good case to get the message to the public.

Secretary LaHood thanked the Committee for noting in recommendation 5 that AMT relief for airports 

has been effective and observed that the DOT received praise for its efforts in getting relief for airports 

from the AMT in the American Recovery and Reinvestment Act of 2009, Public Law 111–5.

Secretary LaHood asked the committee for further explanation of the tax burden on air carriers, 

passengers, and general aviation covered in recommendation 10. Mr. McKenzie explained that the 

recommendation is about making taxes more efficient and ensuring the taxes being collected are 

resulting in economic benefits and benefits to the aviation industry and passengers. He cited the 

disproportionate level of taxes since the 1990s and a general lack of pricing power among air carriers 

on ticket prices. 
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Mr. Tilton added the FAAC Subcommittee on Competitiveness and Viability was able to consider 

multiple points of view on this topic and develop a recommendation stating the committee does not 

believe 17 separate taxes are efficient, effective, and transparent, and some government officials may 

not even understand that there are 17 taxes or whether they are appropriate. Mr. Tilton stated the spirit 

of the recommendation was to have the DOT bring some clarity to the issue and determine whether 

these taxes are indeed necessary and serving their purpose. Ms. Ana McAhron-Schulz, ALPA, added 

that taxes and fees are not a new issue for the aviation industry, but the committee believes another 

look at this issue is warranted.

Secretary LaHood expressed his belief that open skies agreements negotiated between the United States 

and foreign countries have benefited the aviation industry. He asked if the committee was suggesting 

expansion of these agreements in recommendation 9. Mr. Tilton responded that the air carrier industry 

is realizing the benefits of open skies agreements, and the competitive landscape of the global aviation 

industry is changing dramatically. He cited the need to continue reviewing whether there are 

inhibitions to global competition, as well as ensuring that air carriers outside the United States are not 

receiving benefits over U.S- based air carriers to ensure a level playing field for the global aviation 

industry. Ms. Friend stated an area of significant discussion in the Labor and World-class Workforce 

Subcommittee that did not result in a recommendation was whether future open skies agreements 

should have provisions for human and workers’ rights. She asserted workers in the U.S. aviation 

industry have concerns that some open skies partner countries are not providing these rights.

Mr. Robert Lekites, UPS, cited the positive effects of open skies agreements on his air carrier. He 

explained these agreements have led to global growth for UPS, allowing the company to carry 

packages to over 200 countries worldwide, which has in turn fueled UPS’s domestic job growth. 

Mr. Lekites added opportunity for growth in global markets still exists, and that open skies agreements 

help domestic companies expand globally.

Mr. Barger pointed out that some of the topics that were tough issues and the most debated issues 

formed the basis of good recommendations, such as the Workforce/Management conference in 

recommendation 17. He cited these venues as good opportunities for both parties to educate each other 

on important topics, such as work performed by foreign repair stations.

Secretary LaHood asked Mr. Babbitt if he had any further comments on the recommendations. 

Mr. Babbitt asked the Committee for further explanation of Recommendation 22, Identification of 

Safety Priorities. He noted rulemaking efforts at FAA take significant time and are influenced by a 

number of parties, including Congress. Mr. Babbitt asked what prioritization methods the committee 

had considered during development of this recommendation. Ms. Piasecki stated the committee was 

aware of the numerous rulemakings the FAA undertakes by recommendation or mandate from a wide 

variety of sources, and that all of them could not possibly be implemented. She added the committee 

did not prescribe a specific action to be taken by the DOT or FAA because it lacked the time to discuss 

this specific issue in depth. Ms. Piasecki offered the safety prioritization work of CAST in the early 

1990s as an example of how industry and government can collaborate for the benefit of aviation safety. 

Ms. Piasecki concluded by stating the committee’s intent is to ensure that the FAA gives priority to

rulemakings that directly improve aviation safety.
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Mr. Lekites briefly discussed the enforcement aspect of this recommendation, stating that compliance 

inspections by FAA personnel that are not directly related to safety improvements, such as discovering 

an item in a maintenance log book that was not signed off, do not improve aviation safety. He cited the 

need to focus on a safety-driven agenda by regulatory agencies, rather than more traditional 

enforcement, in which violations are often issued for relatively minor infractions that ultimately have 

no direct impact on aviation safety.

Mr. McGee stated significant discussion occurred on the topic of the FAA’s oversight of contract 

maintenance facilities, though no recommendation resulted because of lack of consensus. He 

expressed his belief that the topic was not solely a labor issue but had safety implications. Mr. McGee 

described the changes that have taken place in how maintenance is performed on air carrier aircraft 

over the last few years, with a greater amount being performed by contract facilities. He noted many of 

these contract facilities are not located in close proximity to FAA field offices, as air carrier 

maintenance bases traditionally are, and it would seem oversight would be more difficult. Mr. McGee 

added while data may not support that this is a safety risk, from a predictive standpoint, there would 

certainly be the chance for such a dramatic shift in air carrier maintenance to introduce risk into 

the system.

Ms. Bowens noted it was apparent that recommendations on NextGen went through every FAAC 

subcommittee, and were independently developed but all tie together in some form. She expressed her 

belief that this nexus should indicate NextGen is a priority for the DOT and the aviation industry.

Mr. Barger added he is a co-chair of the NextGen Advisory Committee, and the FAAC’s 

recommendations on this topic should blend well with that committee’s work. Dr. Alonso cautioned 

that as the aviation industry transitioned to new processes with the implementation of NextGen, new 

safety hazards should be anticipated and mitigated.

Mr. Porcari stated on the topic of environmental recommendations, the committee made good 

recommendations, and efforts such as NextGen efficiencies, the FAA CLEEN program, and research 

and development work on alternative aircraft fuels provide a real opportunity for the aviation industry 

to highlight its efforts to reduce environmental impacts. He further asserted this opportunity should be 

seized to demonstrate the aviation industry is taking the lead in these areas in order to avoid the 

imposition of new regulations. Secretary LaHood stated he had no further questions, and thanked the 

committee for their explanations of the recommendations.
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Closing Remarks

Ms. Kurland moved to her closing remarks. She thanked the FAAC members for their work and 

commitment. Secretary LaHood called for final comments before the meeting closed. Ms. Piasecki 

emphasized that aviation is a global industry and commented on the heritage in the United States 

around aviation across the value stream. She noted the importance of recognizing the United States is 

competing with countries making significant investments in infrastructure, equipment, and air carriers. 

Ms. Piasecki expressed her appreciation for Secretary LaHood’s leadership in taking a coordinated 

approach in critical areas such as intermodality and NextGen. Secretary LaHood acknowledged the 

importance and added his surprise at the rapid expansion of international airports, particularly in China. 

He agreed with Ms. Piasecki’s comment on the work already done and the work that needs to be done 

to stay competitive. 

Mr. McKenzie raised the issue of jet fuel price volatility. He commented on how excessive volatility 

has the possibility of wreaking havoc with air carrier financials. 

Ms. Baer commented that the FAAC members have been thanked as a committee. She expressed her 

appreciation for the DOT and FAA staff support, and also recognized the hard work of the staff from 

United, PANY/NJ, Boeing, and others who have worked together. Secretary LaHood thanked everyone 

from the DOT, FAAC, and industry, and recognized everyone’s hard work. 

Mr. Conley expressed his gratitude to hear Secretary LaHood embrace the semi-annual workforce/

management conversation. Secretary LaHood emphasized its importance and stated his intention to 

assign a full-time person from his office to immediately work with Ms. Kurland and Ms. Fornarotto to 

implement these recommendations. He further stated his intention to develop a timeline for each 

recommendation and report the timelines to the FAAC by the middle of February 2011. 

Secretary LaHood explained the next step will be to gather the resources of talented people, including 

some FAAC members, and implement recommendations. 

Secretary LaHood expressed his enthusiasm for the opportunity to incorporate NextGen into FAA 

activities and harmonize the recommendations. He commented on how the White House will become 

involved in the environmental recommendations. Secretary LaHood explained the DOT will be candid 

and simply identify recommendations that cannot be quickly implemented. He stated many of the 

recommendations can be accomplished quickly with the proper resources. Secretary LaHood promised 

the recommendations will not sit on a shelf. He expressed his gratitude to everyone involved. 

Secretary LaHood explained these recommendations will improve the industry and will improve the 

opportunity for the flying public to fly safely for affordable prices. He promised to keep in touch and 

thanked everyone. 

Ms. Kurland reviewed some housekeeping items. She added the DOT will prepare and issue a final 

report based on the recommendations, which will include other areas of significant discussion from 

each of the subcommittees. Ms. Kurland mentioned the report will be available on the FAAC Web site. 

She offered her final words of appreciation and asked Ms. Hamilton to close the meeting for the 

final time.
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Adjournment

Ms. Hamilton solicited a motion for adjournment. On motion, duly seconded and approved by the 

majority of the FAAC members present, the meeting adjourned.

The meeting adjourned at 2:32 p.m.

I hereby certify that, to the best of my knowledge, the foregoing minutes are accurate and complete.

Approved by: _______________________________________________

Pamela Hamilton-Powell, Designated Federal Official

Dated: _________January 25, 2011______________________________