Document ID: DOT-OST-2018-0132-0001
Agency: dot
Document Type: Proposed Rule
Title: Origin-Destination Survey of Airline Passengers; Updates
Posted Date: 2021-01-19T05:00Z

[Federal Register Volume 86, Number 11 (Tuesday, January 19, 2021)]
[Proposed Rules]
[Pages 5052-5063]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-29229]

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DEPARTMENT OF TRANSPORTATION

Office of the Secretary of Transportation

14 CFR Parts 241 and 298

[Docket No. DOT-OST-2018-0132]
RIN 2105-AE45

Updates to the Origin--Destination Survey of Airline Passengers

AGENCY: Office of the Secretary of Transportation (OST), U.S. 
Department of Transportation (DOT).

ACTION: Notice of proposed rulemaking (NPRM).

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SUMMARY: The Department is proposing to update the method of collecting 
and processing aviation traffic data in the Origin-Destination Survey 
of Airline Passenger Traffic (O&D Survey), as well as to expand the 
number of reporting air carriers, the sample size collected, and the 
scope of the data reported. These changes would align the current O&D 
Survey with modern industry business and accounting practices, enable 
cost savings, reduce burden through automation, and provide enhanced 
utility for users of the data. In addition, DOT is proposing to change 
the timing of the release of the Form 41, Schedule T-100(f) ``Foreign 
Air Carrier Traffic Data by Nonstop Segment and On-flight Market'' from 
a 6-month delay to a 3-month delay to match that of Form 41, Schedule 
T-100 ``Air Carrier Traffic and Capacity Data by Non-Stop Segment and 
On-Flight Market.''

DATES:  Submit comments on or before March 19, 2021, 11:59 p.m. Eastern 
Time. The Department will consider late comments to the extent 
practicable.

ADDRESSES: To ensure that you do not duplicate your docket submissions, 
please submit all comments by only one of the following means:
     Federal eRulemaking Portal: Go to http://www.regulations.gov and follow the online instructions for submitting 
comments.
     Mail: Docket Management Facility, U.S. Department of 
Transportation, 1200 New Jersey Ave. SE, West Building, Ground Floor, 
Room W12-140, Washington, DC 20590-0001.
     Hand Delivery: U.S. Department of Transportation, 1200 New 
Jersey Ave. SE, West Building, Ground Floor, Room W12-140, Washington, 
DC 20590-0001, between 9:00 a.m. and 5:00 p.m. ET, Monday through 
Friday, except Federal holidays.
    Instructions: At the beginning of your comments, include the agency 
name, docket name, and docket number (DOT-OST-2018-0132) or Regulation 
Identifier Number (RIN) for this rulemaking (2105-AE45). All comments 
received will be posted without change to http://www.regulations.gov, 
including any personal information provided. Physical access to the 
Docket is available at the Hand Delivery address noted above.
    Electronic Access and Filing: You can view this document by going 
to the Federal eRulemaking Portal: http://www.regulations.gov and 
search for docket DOT-OST-2018-0132. The website is available 24 hours 
each day, 365 days each year. Electronic submission and retrieval help 
and guidelines are available under the help section of the website. An 
electronic copy of this document is available for download from the 
Office of the Federal Register's home page at: http://www.archives.gov/federal-register and the U.S. Government Publishing Office's web page 
at: https://www.gpo.gov/fdsys/ fdsys/.

FOR FURTHER INFORMATION CONTACT: Mark Raggio, Office of Aviation 
Analysis, 1200 New Jersey Ave. SE, Room W86-470, Washington, DC 20590-
0001, 202-366-1271 (phone) or Mark.Raggio@dot.gov (email).

SUPPLEMENTARY INFORMATION:

I. Background

A. Legal Authority

    Section 429(b)(1) of Title 49, U.S.C., requires the Department to 
collect and disseminate information on the origin and destination of 
airline passengers including, at a minimum, information on: (1) The 
origin and destination of passengers in interstate air transportation, 
and (2) the number of passengers traveling by air between any two 
points in interstate air transportation. In addition, 49 U.S.C. 
40101(a)(7) states that the Secretary shall respond to the needs of the 
public, including the airline industry, all levels of government, and 
airports, by disseminating information to foster a national air 
transportation system capable of meeting the present and future needs 
of U.S. commerce. In fulfillment of these responsibilities, DOT 
collects data submitted under:
     14 CFR part 217: Reporting Traffic Statistics by Foreign 
Air Carriers in Civilian Scheduled, Charter, and Nonscheduled Services, 
whereby foreign air carriers that are authorized by DOT to provide 
scheduled passenger services to or from the U.S. must file Form 41 
Schedule T-100(f), accumulated in accordance with the data elements 
prescribed in Sec.  217.5.
     14 CFR part 241: Uniform System of Accounts and Reports 
for Large Certificated Air Carriers, under which all large certificated 
air carriers must report their traffic movements by filing Form 41 
Schedule T-100, Financials Information, and O&D fare information.
     14 CFR part 298: Exemptions for Air Taxi and Commuter Air 
Carriers, whereby air taxi operators and commuter air carriers, which 
are provided certain exemptions from some of the economic regulatory 
provisions of Subtitle VII of Title 49 of the United States Code, are 
required to submit simplified Financials and T-100 traffic.
    In this rulemaking, the Department proposes to update its method of 
collecting and processing O&D fare information under part 241 to: (1) 
Allow full automation of the reporting of the O&D Survey by aligning it 
with current airline passenger accounting practices; and (2) enhance 
the accuracy and usefulness of DOT's collection of aviation traffic 
data.

B. Background on the O&D Survey

    Currently, the O&D Survey, as outlined in 14 CFR part 241, Sec. 19-
7, collects airline tickets from select air carriers,\1\ ``O&D Survey 
Reporting Carriers,'' each quarter. The O&D Survey Reporting Carriers 
combine the information from tickets with the same itinerary and price 
into a summary record reported every 3 months. Under 49 U.S.C. 
329(b)(1), the Department is obligated to collect and disseminate this 
information. There are many private and public stakeholders that depend 
on this data to make decisions on aviation business and policy. For 
example, this data is used by the industry to plan air services, 
develop commercial aviation

[[Page 5053]]

infrastructure, measure the economic impact of passenger flows, and 
create business plans for start-up airlines. The O&D Survey is also a 
primary source of information used to quantify and evaluate the 
effectiveness of Federal aviation policy and programs as well as to 
develop and implement new policies and infrastructure initiatives.
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    \1\ 49 U.S.C. 40102(a)(2).
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    When the current rules for collection of the O&D Survey were 
established in the 1960s, the O&D Survey provided the best reasonably 
obtainable measure of passenger aviation activity. The mainframe 
technologies of the era dictated many aspects of the O&D survey 
business process and the elements selected for collection. A key driver 
of the process was that data storage was expensive in that era which 
resulted in a minimum of data elements being included. This meant more 
robust descriptive data, such as the time of arrival and departure, 
were not included in the collection. Because mainframes were 
centralized computing resources, the O&D Survey process was designed to 
route paper tickets to a centralized facility for processing and 
loading into the systems. In the intervening years, changes in airline 
business models and accounting practices enabled by technology 
improvements were not reflected in DOT's collection methodology, 
leading to a misalignment between the rules for reporting the 
information and current accounting practices that generally requires 
human intervention to reconcile differences and prevents O&D Survey 
Reporting Carriers from fully automating the system of data collection. 
The primary design issue that prevents current improvements is the 
regulatory requirement that the operating carrier that first touches 
the ticket is the carrier that has responsibility to report the ticket, 
known as the ``first reporting carrier rule.'' In the 1960s, this rule 
was selected because the most efficient process was physically to 
detach the ticket coupons as they were flown for each flight and send 
all the coupons to the centralized processing facility to be matched 
and combined with the relevant revenue information. Because the carrier 
that issued the ticket, which had all the necessary information on 
hand, often did not first touch the ticket, the carrier with the least 
amount of information was by rule responsible for reporting the ticket. 
Modern and decentralized E-ticket systems eliminate the need for a 
physical coupon matching process and enables more efficient reporting 
rules and access to more relevant data.
    DOT has worked with representatives of the aviation industry trade 
association Airlines for America (A4A) to determine the best way to 
improve the methodology, collection, and utility of the O&D Survey. DOT 
is proposing this rule to reform and simplify the O&D Survey, 
principally by reorienting the reporting requirements so that air 
carriers report primarily information for tickets that they issue.

II. The Need To Modernize Current Data Collection Requirements

    The data collected in the O&D Survey provides DOT with the 
information to help foster an air transportation system capable of 
meeting the present and future needs of commerce in the United States. 
However, the current O&D Survey methodology was designed based on 
accounting processes long abandoned by airlines, including manual 
accounting systems that often had handwritten records. As a result, the 
Survey's data collection methodology does not reflect today's 
decentralized and integrated industry-wide practices and technologies, 
and, in some cases, it is not capable of accurately documenting 
consumer behavior. For example, in today's environment, it is far more 
efficient for the carrier that issues the ticket to be responsible for 
reporting the ticket because it is the issuing carrier that has all the 
information about the ticket. Current process requires the operating 
carrier that flies the first coupon of the ticket to report and this is 
often not the issuing carrier. Because current reporting does not 
contain information about the length of stay at each intermediate point 
in a ticket, the system must impute the intended destination of round 
trip tickets. With the advent of large-scale connecting services, this 
has made the determination of intended destination less accurate. 
Though the Survey remains a unique and foundational pillar of industry 
economic analysis, its limitations create high levels of uncertainty in 
certain situations, such as identifying the true origin and destination 
of some passengers; the month of travel; and the portion of the total 
amount paid that is the revenue retained by the air carrier, as opposed 
to taxes and fees remitted to other government entities. By aligning 
the O&D Survey with current industry technology and integrated business 
process, this proposal would vastly simplify the reporting of 
appropriate data elements and increase the utility of the Survey to its 
users.

A. Changes in Airline and Consumer Behavior Since 1978

    The way the airline industry markets and delivers air 
transportation services to the public changed significantly following 
the Airline Deregulation Act of 1978.\2\ The 1978 Act enabled airlines 
to set their own fares, flight frequencies, and route structure. The 
current rules for the collection of ticket information were 
specifically designed to measure the relatively static air travel 
industry of the 1960s, when fares and flight frequencies were set by 
the Federal Civil Aeronautics Board and tended to be from a single 
point to a single point. The current O&D Survey data collection rules 
do not reflect the increasingly dynamic and complex business practices 
that have emerged since deregulation, including the development of hub-
and-spoke systems, frequent flier programs, revenue management systems, 
internet distribution of tickets, and other industry-transforming 
innovations. For example, under the post-deregulation hub-and-spoke 
model developed by legacy air carriers, it became increasingly common 
to fly initially to a single, large ``hub airport'' where some 
passengers would change planes to complete their journey, while others 
remained on the same plane during intervening stop(s), known as a 
``direct'' passenger flight. In the case of the ``direct'' passenger, 
the carriers would use a single ticket that identifies the origin and 
ultimate destination, but not the intermediate stop(s). Furthermore, in 
combination with these changes, new airline loyalty programs altered 
passenger ticket purchasing behavior; travelers in these programs were 
increasingly incentivized to take longer, indirect routes, often 
through an airline's large hub airport, that would allow them to 
accumulate more mileage-based loyalty points, exacerbating reporting 
issues, such as identification of the intended destination of travel, 
with the O&D Survey. The industry innovations forged after deregulation 
changed the fundamentals of airline competition, but the process used 
and the data DOT collects did not modernize concomitant with these 
changes.
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    \2\ Public Law 95-504.
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B. Reevaluation of O&D Survey Burden and Data Quality

    Considering these developments, DOT initiated a retrospective 
analysis of its aviation traffic reporting rules. The Department 
recognizes that there are concerns with the quality of the current O&D 
Survey, and that it is expensive

[[Page 5054]]

and burdensome to collect, validate, and use. Collaborative discussion 
with A4A representatives revealed that there is a substantial hidden 
cost of compliance in reporting aviation statistics due to the 
difficulty in identifying and investigating problems that are often 
only revealed during post-submission quality control processing. The 
carriers are also often in the position of having to interpret how to 
stay in compliance with outdated rules that require them to deviate 
from their current accounting practices. For these reasons, the 
Department believes that the O&D Survey no longer meets the guidance 
outlined in OMB Circular A-130 \3\ or the data collection standards of 
the Information Quality Act.\4\ In addition, DOT identified instances 
in the reporting regulations that contribute to deficiencies in data 
quality. These deficiencies are often not observable until after the 
data from all the carrier submissions is combined during post-
processing analysis. Moreover, ambiguity in the current regulation may 
lead O&D Survey Reporting Carriers to interpret reporting instructions 
differently, contributing to the degradation of the O&D Survey data 
quality and increasing the air carrier's reporting burden as they must 
review the suspected data and resubmit once the problem is found.
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    \3\ Circular A-130 requires DOT to take affirmative steps to 
ensure data quality objectivity and utility of Federal statistics 
before disseminating them and notes that public and private 
resources are allocated inefficiently when uncertainty is introduced 
due to inexact or incorrect data.
    \4\ Public Law 106-554 Section 515 charges Federal agencies with 
a responsibility to produce the best reasonably obtainable 
scientific and economic information available to measure the impact 
of their regulatory responsibilities.
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    Furthermore, DOT determined that the collection and dissemination 
of the O&D Survey remains justified under the regulatory philosophy 
stated in Executive Order (E.O.) 12866, sec. 1(a) which is that ``the 
Federal Government should . . . promulgate regulations as required . . 
.'' It was also determined that, given its role and statutory duties, 
DOT is best positioned to collect uniform, accurate, and complete data 
on the Nation's civil aeronautics sector as well as ensure widespread 
dissemination of the collected data. Diverse public and private 
stakeholders, including air carriers, investors, and aircraft 
manufacturers, rely on this data to inform business decisions, 
infrastructure improvements, and aviation regulations or public 
policies. For example, the airline industry continues to use the O&D 
Survey to plan air services, develop commercial aviation 
infrastructure, measure the economic impact of passenger flows, and 
create business plans for start-up airlines. The data is also a primary 
source of information used to measure and evaluate the effectiveness of 
Federal aviation policy and programs, including by: (1) Improving 
international air services by seeking market liberalization, (2) 
ensuring the benefits of a deregulated, competitive domestic airline 
industry, and (3) developing policies to improve air service and access 
to the national air transportation system for small and rural 
communities. Furthermore, the Federal Aviation Administration (FAA) 
requires airports to use accurate aviation data for qualifying, 
planning, allocating, and monitoring of Airport Improvement Program 
(AIP) funds and to justify the need for Passenger Facility Charges 
(PFCs). The outdated and cumbersome O&D Survey methodologies impose 
excessive burdens on O&D Survey Reporting Carriers and diminish the 
data's utility to its users due to quality, objectivity, and 
completeness issues, and therefore requires modernization. In addition, 
ensuring universal participation across air carriers and collection of 
the best reasonably obtainable measurements of economic activity in the 
aviation sector requires updating the O&D Survey methodologies.

C. Meeting Reporting and Data Quality Demands

    This proposed rule would modernize the O&D Survey to reflect 
current airline passenger behavior and revenue accounting practices, 
which allow air carriers to track the sale and the usage of every 
ticket sold, including through partner carriers. In doing so, the 
proposed rule would ensure that the O&D Survey meets the requirements 
and objectives of the Information Quality Act,\5\ E.O. 12866, E.O. 
13771, and OMB Implementation Guidance for Title V of the E-Government 
Act, Confidential Information Protection and Statistical Efficiency Act 
of 2002.\6\
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    \5\ Public Law 106-554, sec. 515.
    \6\ 72 FR 33362 (June 15, 2007).
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III. Development of the Proposed Rule

A. Prior Related Rulemakings

    The Department initiated a retrospective analysis of its passenger 
traffic statistics on July 15, 1998, when DOT published an advance 
notice of proposed rulemaking (ANPRM),\7\ requesting comment on a 
variety of issues related to aviation economic data collection.
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    \7\ 63 FR 28128.
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    On February 17, 2005, DOT published a notice of proposed rulemaking 
(NPRM) \8\ as part of DOT's effort to revise the rules governing the 
nature, scope, source, and means for collecting and processing aviation 
traffic data as well as modernize the collection, processing, and 
dissemination of this data. While there was considerable support for 
these changes among stakeholders, the comments from the airlines 
indicated that the burdens of reporting the data would be unacceptably 
high relative to the current collection. The 2005 proposal to collect 
all relevant data on the ticket was overly broad and too costly to 
implement. The Department withdrew the proposal on June 1, 2011, 
stating that the proposed approach did not adequately address some 
issues, including measures that could both enhance the utility, 
integrity, and accuracy of the data and reduce the cost of reporting. 
The current proposal, by comparison, is more narrowly tailored to 
address specific well-known quality problems that have been identified 
by both producers and users of the data over a long period of time, 
maintains the same data structure of the current reporting allowing for 
reuse of as much of the existing infrastructure as possible, removes 
elements that are no longer required, adds new useful elements, and 
improves reporting rules.
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    \8\ 70 FR 8140.
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B. Summary of Modifications Suggested by the Industry

    This proposed rule renews DOT's effort to revise its aviation 
statistical reporting process. In an October 5, 2015, letter to DOT, 
A4A recommended changes to the reporting regulation that would increase 
the utility and accuracy of the data while simplifying reporting. 
Representatives of A4A notified DOT that their members favored updating 
the rule governing the collection of the O&D Survey under prescribed 
circumstances. A4A identified changes to reporting that would increase 
the utility of the data and, at the same time, simplify reporting. 
These proposed changes were reflective of numerous interactions related 
to the data collection between government and industry over many years. 
The series of ideas that stemmed from this collaboration are listed 
below.
Methodology Changes
    (1) Change the responsibility of reporting tickets from the First 
Reporting Carrier Rule to the Issuing Carrier; \9\
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    \9\ The current regulation places the reporting responsibility 
on the first O&D Survey Reporting Carrier in the sequence of travel 
for a ticket. The proposed regulation will place the reporting 
responsibility on the carrier that issued the ticket. It is the 
carrier that issues the ticket that will have the most information 
about the ticket.

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[[Page 5055]]

    (2) Classify all Certificated air carriers and commuter air 
carriers holding out scheduled passenger service as O&D Survey 
Reporting Carriers by removing the exemptions from reporting given to 
U.S.-based air carriers and commuter air carriers with a business model 
that limits them to flying aircraft with fewer than 60 seats;
    (3) Refrain from requiring foreign air carriers to report O&D 
Survey data, other than foreign air carriers granted anti-trust 
immunity under 49 U.S.C. 41308 and 41309; instead, the responsibility 
to report tickets issued by a foreign air carrier (that does not submit 
data under 49 U.S.C. 41308 and 41309) should remain with the O&D Survey 
Reporting Carrier that appears first in the travel sequence of the 
ticket;
    (4) Change the period of reporting from quarterly to monthly;
    (5) Increase the sample size to 40% of airline tickets so that the 
sample size is statistically valid for measuring travel to small and 
rural communities; and
    (6) Shorten time lag for the release of T-100(f) data from the 
current 6 months to 3 months, consistent with the release of T-100 
Domestic data. Historically this time lag has existed because of 
technological and business practice limitations.
New Data Items To Be Collected
    (1) ``Dwell Time,'' an indication of the hours that the passenger 
spends at an airport between their arriving and departure flights;
    (2) ``Via Airport,'' an entry for airlines to report hidden 
airports or ``via'' airports where a passenger lands, but does not 
necessarily deplane;
    (3) ``Total Tax,'' a value of the total taxes and government-
imposed fees collected for each ticket, to distinguish this value from 
the Total Amount of the fare collected;
    (4) ``Travel Year and Month,'' to include a field detailing the 
year and month the passenger travels for each segment of travel;
    (5) ``Exchanged Ticket Indicator,'' alerting data users that a 
reported fare may not comport with the reported itinerary; and
    (6) ``Reporting Record Identifier,'' facilitating easier record 
identification by the O&D Survey Reporting Carrier when correcting 
tickets reported with errors.
Data Items the Department Proposed No Longer Be Collected
    (1) The fare class the passenger uses on each of the flights;
    (2) The cabin class the passenger uses on each of the flights; and
    (3) The date of ticket purchase.
    In November 2015, the Airline Tariff Publishing Company (ATPCO), 
the leading distributor of airline fares and airline fare information 
for the industry notified DOT that it had the ability to report the 
proposed restructured O&D Survey as envisioned by A4A and DOT and that 
ATPCO could offer that capability as a third-party service to airlines.

C. Goals and Objectives of This Regulatory Action

    The Department established the following objectives for this 
rulemaking: (1) Reduce the long-term reporting burden on the O&D Survey 
Reporting Carriers; (2) make the O&D Survey more relevant and useful to 
airlines, aviation policy makers, researchers, and stakeholders; (3) 
obtain more accurate ticket data from a broader group of air carriers 
and markets; (4) reduce the time it takes to disseminate the O&D Survey 
and the T-100(f); and (5) increase the statistical correlation between 
the O&D Survey and the T-100/T100(f) for data validation purposes. 
Taken together, this proposed rule would alleviate unnecessary 
regulatory burdens placed on the American people and businesses.

IV. Proposed Changes to the Collection of Data

    The Department proposes the following modifications to its 
collection of scheduled passenger aviation data:

D. Altering the Reporting Framework

    The general process for reporting O&D data is to collect the ticket 
information once there is an indication that the ticket has been flown, 
combine all the ticket coupons to determine all the points flown and 
the sequence of travel on the ticket, and integrate the flown 
information with revenue information related to the price the consumer 
paid for the ticket.
1. Selection of Tickets to Report
a. Making the Ticket the Basic Unit of Reporting
    This proposed rule would give O&D Survey Reporting Carriers the 
responsibility for reporting a ticket when it is the Issuing Carrier 
for that ticket, relieving air carriers of the responsibility to report 
any ticket issued by another O&D Survey Reporting Carrier. Under the 
proposed rule, Issuing Carriers would know when a coupon from one of 
their tickets is used for transportation by any other air carrier on 
the ticket, triggering a Reporting Event. Moving the responsibility to 
report to the Issuing Carrier would simplify the reporting process by 
establishing one identifiable air carrier that has all the information 
on a ticket and is responsible for reporting the ticket. These types of 
tickets will account for the majority of reported tickets. Tickets 
issued by an O&D Survey Reporting Carrier would be referred to as 
``Category One Tickets.''
    In addition to Category One tickets, tickets may be issued by air 
carriers who would not fall under the new definition of O&D Survey 
Reporting Carriers; however, those tickets may still present 
information that should be recorded. The proposed rule would continue 
to require each O&D Survey Reporting Carrier to report these 
encountered tickets issued by Non-O&D Survey Reporting Carriers. These 
tickets would be referred to as ``Category Two Tickets.'' Category Two 
Tickets would require a process for recognizing a Reporting Event that 
is different than that for Category One Tickets. The proposed Category 
Two reporting process would be like the existing process, but the 
expected volume of Category Two Tickets will be significantly less 
under this proposed rule due to the expansion of the pool of O&D Survey 
Reporting Carriers and the Category One reporting rule, which will have 
primacy.\10\
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    \10\ For evaluating Category 2 tickets, foreign air carriers 
that have been granted Antitrust Immunity under 49 U.S.C. 41308 and 
41309 will be responsible for reporting Eligible Tickets they issue 
and U.S. air carriers will no longer have to report these.
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    The Department recognizes that it could eliminate Category Two 
Tickets, and therefore the associated burden of reporting these 
tickets, by requiring all foreign air carriers providing scheduled 
service to the United States to submit O&D Survey data. The Department, 
therefore, seeks comment on whether to require all foreign air carriers 
providing scheduled service to the United States submit O&D Survey 
data.
b. Increasing Sample Size to 40 Percent
    This proposed rule would increase the number of passenger tickets 
air carriers are required to report, which would create a statistically 
valid sample for meaningful analysis of smaller markets that is not 
available under the current O&D Data collection. The current sample 
size of 10 percent is only sufficient for analyzing large markets and 
the national air transportation

[[Page 5056]]

system at a broad level. Studies indicate that a 40 percent sample is 
sufficient to allow proper evaluation of small aviation markets, and so 
the Department is proposing to increase the number of passenger tickets 
are required to report to 40 percent.\11\ The ability to measure small 
markets is important to air carriers and to policy makers in order to 
monitor the effectiveness of Federal dollars spent in programs such as 
the Essential Air Service (EAS) and the Small Community Air Service 
Development Program (SCASDP), that are designed to ensure that small 
and rural communities have access to the national air transportation 
system. The 40 percent sample, in combination with expanding the 
universe of O&D Survey Reporting Carriers, would substantially improve 
the ability to measure smaller markets accurately.
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    \11\ Statistical analyses by Michael Wittman (Michael D. 
Wittman, A Note on the Use of U.S. DB1B Passenger Ticket Data for 
Estimating Airfares in Thin Airline Markets or Small Airports, 
Massachusetts Institute of Technology), and Eric Amel (Eric Amel, 
Report on the Results of Different Sampling Rates on the Reliability 
of the US DOT O&D Survey, Compass Lexecon, May 18, 2015) are 
available in the Docket.
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c. Providing an Unbiased Sample Selection
    The proposed rule would designate the final, right-most digit of 
the standard ticket document number as the basis for the new, random 
sample size. Analyses by DOT suggest that the final digit of a ticket 
number does not pertain directly to any particular type of passenger or 
journey, and every digit (0-9) has an equal probability of appearing. 
This method ensures that the random sampling of 40 percent of Eligible 
Tickets for the O&D Survey would be truly unbiased and random, 
protecting the validity and integrity of the data.
    Any O&D Survey Reporting Carrier that does not assign ticket 
numbers to passenger journeys or does not assign ticket numbers such 
that the final, right-most digit is not randomly assigned would be 
required to develop an alternative method of creating a valid 40 
percent sample. Those O&D Survey Reporting Carriers would need to 
submit their alternative sample methods to DOT for approval within 90 
days of the date that the O&D Survey Reporting Carrier recognizes that 
it must make use of the alternative sample selection method to comply 
with the proposed reporting regulation for determining an Eligible 
Ticket.
2. Removing the Requirement for Summarization
    Under the proposed rule, O&D Survey Reporting Carriers would report 
individual tickets as separate records, rather than aggregating tickets 
with identical characteristics into a single reporting record. 
Currently, the number of tickets in each grouping is tracked and 
reported as a passenger count. This process was initially instituted 
because the cost of data transmission and storage exceeded the cost of 
processing the records into summarized records. However, due to 
significant advances in data transmission and storage technology, any 
such savings are now minimal. The process of grouping and summarizing 
similar tickets into one summary reporting record creates an 
additional, unnecessary step for the O&D Survey Reporting Carriers, and 
is inconsistent with modern revenue accounting practices. Combining the 
tickets also increased the difficulty of correcting the occasional, 
inevitable mistakes that arise in reporting to the O&D Survey because 
the individual records that cause the problem are not identifiable in 
the summary record that is provided.

E. Modification to O&D Survey Reporting Carriers

    The proposed rule would simplify the identification of the air 
carriers responsible for reporting a ticket, correcting the current 
onerous and burdensome process. It would also all but eliminate the 
need for an air carrier that may not have information on a ticket in 
its internal systems to obtain the information from other sources 
outside its normal business process.
1. U.S. Air Carriers \12\ as O&D Survey Reporting Carriers
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    \12\ 49 U.S.C. 40102(a)(2).
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    The proposed rule would require that all U.S. air carriers that 
hold either a certificate of public convenience and necessity for 
scheduled passenger air transportation pursuant to 49 U.S.C. 41102 or 
that hold a Commuter Air Carrier Authorization pursuant to 14 CFR part 
298 and that hold out a schedule and issue tickets for scheduled 
passenger air transportation be considered O&D Survey Reporting 
Carriers for the O&D Survey. This proposed rule would require all O&D 
Survey Reporting Carrier to submit O&D Survey data to capture travel in 
markets served by all types of air carriers. However, by making the 
reporting regulation compatible with industry accounting structures, 
DOT expects this reporting would add minimal additional burden to 
affected air carriers. Carriers would only report tickets that satisfy 
the reporting criteria. In most cases, air carriers operating as 
contract lift providers (i.e., code-share branded regional partners) 
would not have to report tickets. If necessary, DOT would work with 
outside third-party vendors, such as ATPCO, to make data collection and 
reporting services available to all O&D Survey Reporting Carriers. The 
Department seeks comment on whether any further accommodation is 
necessary for these smaller air carriers.
2. Foreign Air Carriers That Are Not O&D Survey Reporting Carriers
    Under the proposed rule, foreign air carriers would not report 
passenger O&D data under 14 CFR part 241, Sec. 19-8, which is 
consistent with current reporting requirements. However, foreign air 
carriers would still need to report data as required by a grant of 
antitrust immunity under 49 U.S.C. 41308 and 41309, which represent a 
separate set of reporting regulations. O&D Survey Reporting Carriers 
will determine if a foreign air carrier that reports under 49 U.S.C. 
41308 and 41309 issued a ticket, and if so, the O&D Survey Reporting 
Carrier will not be responsible for reporting the ticket.
3. O&D Survey Reporting Carriers List
    The proposed rule would require that DOT post the O&D Survey 
Reporting Carriers List one month in advance of its monthly effective 
date to ensure that O&D Survey Reporting Carriers are aware of all 
updates and give the O&D Survey Reporting Carriers time to update their 
internal processes to comply with reporting requirements.\13\ For 
example, an update to the list posted January 31st would be effective 
for reporting beginning in March. The O&D Survey Reporting Carriers 
List would be updated as soon as administratively possible when an O&D 
Survey Reporting Carrier becomes qualified or is disqualified as an O&D 
Survey Reporting Carrier.
---------------------------------------------------------------------------

    \13\ Domestic air carriers may change their business model from 
one of only providing contract lift, not holding out scheduled air 
service and not issuing tickets, to selling their own services. When 
this occurs, the carrier will need to be added to the O&D Survey 
Reporting List. The same may happen in reverse requiring a carrier 
to be removed from the list. This same process applies to foreign 
air carriers immunized under 49 U.S.C. 41308 and 41309. They may 
also be added or removed from the list depending on their immunity 
status.
---------------------------------------------------------------------------

F. Increasing the Frequency of Reporting

    The proposed rule would require O&D Survey Reporting Carriers to 
report data monthly instead of the current quarterly reporting period. 
Information would have to be reported to the Department no later than 
45 days after the last day of a reporting month. This would make the 
data available to stakeholders on an

[[Page 5057]]

expedited basis compared to the existing quarterly reporting and 
enables users to validate it against other data disseminated monthly, 
such as the T-100.

G. Expanding Data Elements Collected

    Through discussions with A4A, the Department determined the 
expanded data elements selected below are already collected and 
maintained by industry and therefore are minimally burdensome to 
collect. The Department may expand or change the regulatory language to 
include further definition of the requirements for submission, subject 
to the comments received for the final rulemaking.
1. Reporting Scheduled Year and Month of Travel
    The proposed rule would require the O&D Survey Reporting Carriers 
to report the scheduled year and month of departure of each flight 
coupon. Providing this level of granularity would increase the utility 
of the O&D Survey by enabling users to, for example, better compare 
economic activity in the aviation sector against other measures of 
economic activity in the economy that are reported monthly, or with 
other aviation traffic data collected by DOT. Including month of travel 
also would make it easier to validate the submissions against other 
data sources, such as the T100 and T-100(f). Data in the O&D Survey 
currently cannot properly support a direct comparison to 3 months of T-
100/T-100(f) data because the current survey reporting includes data 
with travel dates outside of the three months of the quarterly O&D 
reporting window that cannot be identified in the collected data; 
therefore, the data cannot be accurately segmented on specific time 
periods for comparison with the T-100 or T-100(f).
2. Reporting All Airports in the Itinerary Including Via Airports
    The proposed rule would require reporting of Eligible Tickets to 
include all airports wherein the passenger is scheduled to travel, even 
when the passenger does not deplane. Whereas most tickets document 
travel that consists of flight coupons with one aircraft take-off and 
one aircraft landing, sometimes the passenger is on a flight that lands 
at an airport but the passenger remains on board. This airport is not 
expressly identified in the ticket, and is generally referred to as a 
``via'' airport. The current rules of the O&D Survey do not allow for 
the reporting of ``via'' airports. Collecting this information would 
enable data users to understand better how passengers travel through 
various airline networks, and would provide the necessary information 
for relating T100/T100(f) segment data directly to O&D Survey 
information.
    Identifying the ``via'' airports, currently hidden in an itinerary, 
requires knowledge of the flight number, because each flight number has 
its own unique routing, as well as the date of the scheduled travel, 
because schedules change within monthly boundaries and some flight 
number schedules change by day-of-week (e.g., differing weekday and 
weekend flight itineraries). The Department is not proposing to require 
the reporting of flight number and flight date. Instead, DOT proposes 
that the O&D Survey Reporting Carriers report the ``via'' airport in a 
``Via Airport'' field because the O&D Survey Reporting Carrier knows 
the flight number and flight date while the Department does not.
3. Reporting Dwell Time
    The proposed rule would assist DOT in creating a more accurate 
record of the passenger's intended destination (i.e., true O&D) by 
requiring O&D Survey Reporting Carriers to report the number of hours 
elapsed between the passenger's arrival at an airport on a flight and 
the passenger's departure from the next airport in the tickets travel 
sequence. The standard measure of continuity of a journey in the 
industry is time between flights at an airport, or ``dwell time.'' 
Reporting ``dwell time'' would enable users to make an accurate 
determination of when a passenger has reached a destination versus when 
the passenger is simply waiting for a connecting flight to the intended 
destination. For example, when a passenger stays only an hour or two at 
an airport, the airline assumes that this airport is not an intended 
destination but, instead, the passenger was only at that airport to 
travel onward to an intended destination.
    As the O&D Survey Reporting Carrier knows the flight dates and 
flight times on an individual ticket, the Department proposes that the 
O&D Survey Reporting Carriers report in one hour increments the number 
of hours elapsed between a passenger's arrival and the passenger's 
departure from an Airport, rounding up to the nearest whole hour. This 
measure of time would be reported as a new element, ``Dwell Time.''
4. Reporting an Exchanged Ticket Indicator
    The proposed rule adds a new element, the ``Exchanged Ticket 
Indicator,'' to notify O&D Survey data users that a ticket may warrant 
further examination. The proposed rule would continue to require that 
tickets issued in exchange for unused coupons of a previously issued 
ticket be reported. For Exchanged Tickets, the user of the data would 
be alerted that the value reported as the Total Amount may include a 
form of payment from unused coupons of a previously issued ticket.
5. Reporting a Frequent Flyer Program Ticket
    The Department seeks comment on whether O&D Survey Reporting 
Carriers should report whether a ticket was purchased in part or in 
whole by redemption through a Frequent Flyer Program (FFP). The user of 
the data would be alerted that the value reported as the Total Amount 
may include a form of payment by redemption of FFP miles or points.
6. Reporting Total Amount and Tax Amount
    The rule proposes adding a data element for the ``Tax Amount'' to 
understand the effect of government policy on aviation and allow data 
users the ability to separate taxes paid from the total fare. The rule 
also proposes to rename the currently reported element ``Total Dollar 
Value'' to ``Total Amount.''
a. Total Amount
    The proposed rule would keep the reporting element ``Total Dollar 
Value'' but change the name of the reporting element to the industry 
standard term ``Total Amount'' and clarify the instructions for 
populating the data element. For all Eligible Tickets, the O&D Survey 
Reporting Carrier would report the Total Amount paid for the ticket 
that was mandatory for the passenger to board the aircraft. The 
Department proposes that the Total Amount would include all mandatory 
carrier-imposed charges and government-imposed fees and taxes. Carrier-
imposed charges, which are variously described as fuel surcharges, 
ticketing, check-in, seat, or other fees or charges that are mandatory, 
that a passenger must pay to board the aircraft would be included. In 
addition, the amount of non-airline imposed taxes and fees for the 
ticket would be included. The Total Amount would not include charges 
for optional or ancillary services such as baggage fees, premium seat 
fees, or ticket change fees. For example, if a consumer can choose a 
no-cost seat or seating category, but chooses to purchase a particular 
seat or seating category, that fee should not be included. However, if 
a passenger has a

[[Page 5058]]

choice of seats or seating categories, but there is a cost associated 
with all the options and the consumer must pay a fee regardless of 
which option is chosen, the fee is mandatory and that fee should be 
included in the total cost of the ticket. Regarding mandatory ticket 
purchase fees, if the passenger must pay a fee the amount of which 
depends on the outlet from which the ticket is purchased (e.g., one fee 
for online purchases, a slightly higher (or lower) fee for telephone 
purchases, and a slightly lower (or higher) fee for purchases at the 
ticket counter), payment of one of those fees is mandatory, and the fee 
paid by the passenger should be reported. However, if there is an 
outlet for which there is no ticket fee (e.g., online purchases) and 
the only additional purchase fees are for tickets purchased via the 
airline's disfavored outlets, such as telephone or in-person sales, 
then the fee is not mandatory and would not need to be included in the 
``Total Amount'' reported to the Department.
    The Department seeks comment on whether an ``optional'' ticket 
purchase fee collected from most tickets sold by a carrier should be 
included in the Total Amount of the ticket. For example, if there is a 
disfavored outlet, such as in-person sales, for which there is no 
ticket fee, but a ticket fee is collected from tickets sold from the 
outlet a majority of passengers use (e.g., online purchases), should 
this fee be included in the Total Amount of the ticket? If yes, what 
should the threshold be--greater than 50 percent of tickets sold?
    When reporting Category Two Tickets, the O&D Survey Reporting 
Carrier may not have access to the accounting system of the Issuing 
Carrier. However, because ticket information is routinely shared 
between air carriers and foreign air carriers when transporting shared 
passengers, it can be expected that the O&D Survey Reporting Carrier 
would report as accurately as possible the Total Amount based on the 
information shared by the Issuing Carrier.
b. Tax Amount
    The proposed rule would create a new reporting element, ``Tax 
Amount.'' Along with informing tax policy, this change would allow 
users of the data to determine the actual passenger revenue retained by 
an airline. For Category One Tickets, the O&D Survey Reporting Carrier 
would report the aggregate of fees and taxes imposed by external 
entities (e.g., airport operating authorities and government 
jurisdictions) and paid by the passenger as the Tax Amount, and would 
exclude all carrier-imposed fees.
    When reporting Category Two Tickets, the O&D Survey Reporting 
Carrier may not have access to the accounting system of the Issuing 
Carrier. However, since ticket information is routinely shared between 
air carriers and foreign air carriers in the normal course of business 
when transporting interline passengers, it can be expected that the O&D 
Survey Reporting Carrier would report as accurately as possible the Tax 
Amount based on the information shared by the Issuing Carrier.
    An alternative approach would be to require that the O&D Survey 
Reporting Carrier report all taxes and non-carrier fees separately, 
instead of the current proposal to aggregate the taxes and fees into 
one lump sum. The Department seeks comment regarding the utility to 
users and additional burden to O&D Survey Reporting Carriers of 
reporting individual tax and fee amounts instead of reporting the 
aggregate amount of taxes and fees.
c. Currency and Fractions of a Dollar
    The rule proposes all amounts would be reported in United States 
Dollars (USD), rounded to two decimal places. The rule does not propose 
to impose a uniform methodology for the conversion of foreign currency 
to USD. O&D Survey Reporting Carriers would, however, be expected to 
use a currency conversion methodology that is generally accepted within 
the industry.
7. Record Identification Number
    The rule proposes the creation of a unique Record Identification 
Number (Record ID) generated by the O&D Survey Reporting Carrier for 
each Eligible Ticket submitted to the O&D Survey. This would allow the 
Department to communicate precisely to the O&D Survey Reporting Carrier 
any records that may have missing or incomplete data elements, or are 
otherwise flagged for review. The Department seeks comment on how to 
standardize the format of the Record ID by incorporating helpful 
elements, such as the month and year of travel, plate code of the O&D 
Survey Reporting Carrier, ticket number, or origin/destination, while 
at the same time preserving the number as a unique record identifier.
8. Removal of Fare Basis Code
    The Department seeks comment on whether to cease reporting the Fare 
Basis Code as currently collected, the usefulness of such a data 
element, and how this data element could be revised to minimize the 
burden on O&D Survey Reporting Carriers. Currently, O&D Survey 
Reporting Carriers must map their fare types to a standard set of 
government-defined definitions that do not always match well with their 
business model-specific products, resulting in inconsistent fare basis 
codes being assigned across carriers. Ceasing to report Fare Basis 
Codes would also decrease the burden on the O&D Survey Reporting 
Carriers. Alternatively, the O&D Survey could collect fare class or a 
replacement data element instead, such as cabin class of ticket 
purchased. The Department believes that such a data element would prove 
useful to a variety of industry stakeholders, and would also allow 
users of the data to segment average fares.

V. Proposed Changes to Dissemination of Data

A. Changes to Dissemination of O&D Survey Data

    By collecting data on a monthly basis, instead of quarterly, this 
proposed rule would allow DOT the ability to disseminate the O&D Survey 
statistics more frequently. The Department, however, must balance the 
value of providing timely information to stakeholders with the need to 
protect the business confidentiality of the air carriers. Currently, 
O&D Survey data is typically released 90 days from the end of the 
reporting quarter. The Department proposes withholding the O&D Survey 
monthly data for a minimum of 60 days from the end of the Reporting 
Year and Month. DOT seeks comment on the appropriate amount of time to 
withhold data from dissemination that would still protect the 
competitive interests of the air carriers.
    Another data dissemination issue is the restrictions placed on the 
release of domestic carrier-submitted itineraries with foreign origin 
and destination points in the O&D Survey to non-U.S. citizens. 
Currently, because data covering the operations of foreign air carriers 
that is similar to the information collected in the O&D Survey is not 
available, international itinerary data in the Passenger Origin-
Destination Survey is not generally disclosed because of the potential 
damaging competitive impact on U.S. carriers and the adverse effect 
upon the public interest that would result from unilateral disclosure 
of data related to foreign markets (14 CFR part 241, Sec. 19-7(d)). The 
disclosure policy identifies exceptions for government interests and 
for air carriers contributing data to the O&D Survey. The international 
travel data is available to persons upon a showing that the

[[Page 5059]]

release of the data will serve specifically identified needs of U.S. 
users which are consistent with U.S. interests (14 CFR part 241, Sec. 
19-7(d)).
    The Department is not contemplating a change to its policy 
regarding the release of international travel data; however, DOT 
proposes adding the descriptor ``citizens and non-citizens'' to the 
other persons offered an opportunity to receive the data based on 
specifically identified needs and consistency with U.S. interests. The 
Department seeks comment on the advisability of this clarification of 
language, and whether to grant non-citizens access to the O&D Survey 
data under these circumstances. Finally, DOT seeks comment on whether 
to replace the phrase ``specifically identified need'' with a defined 
list of permissible, specifically identified needs that would be 
codified in the regulation, and, if so, what that defined list should 
include.
    All itineraries that contain a foreign point and involve a U.S. O&D 
Survey Reporting Carrier in the itinerary, regardless of whether a 
domestic or foreign air carrier reports it, would continue to be made 
available under the disclosure policy discussed above.

B. Changes to Dissemination of T-100/T-100(f)

    The Department is considering shortening the time that it withholds 
public release of the T-100(f). Such a change would not only expedite 
public access to O&D Survey data, but it would also make the T-100(f) 
release more consistent with T-100 domestic data by having each 
released on the same schedule. This would simplify the process of using 
DOT's aviation data products by making it easier to harmonize domestic 
and international planning tasks. Considering the increased utility of 
the data in the O&D Survey, DOT is requesting comment on shortening the 
time that T-100(f) is withheld from the current 6 months to 3 months.

VI. Complete List of Elements To Report

    Below is the proposed list of all elements that would be reported 
in the O&D Survey. Elements marked with an asterisk (*) indicate new or 
significantly changed elements. Elements for each submitted report 
would be submitted only once with each report; elements for each 
submitted ticket would be submitted once for each ticket; and elements 
submitted for each airport in the ticket sequence of travel would be 
submitted once for each airport in the sequence of travel.

A. Elements for Each Submitted Report

     O&D Survey Reporting Carrier Identifier: The two-character 
International Air Transport Association (IATA) identifier of the air 
carrier that reports the ticket.
     Reporting Year: Year in which a coupon in a ticket is used 
for air transportation for the first time.
     Reporting Month:* Month in which a coupon in a ticket is 
used for air transportation for the first time.

B. Elements for Each Submitted Ticket

     Record Identification Number:* A unique number assigned by 
the O&D Survey Reporting Carrier to each Eligible Ticket submitted to 
the O&D Survey, allowing DOT to precisely communicate to the O&D Survey 
Reporting Carrier any records that may have missing or incomplete data 
elements, or are otherwise flagged for review.
     Issuing Carrier:* The two character IATA/DOT identifier of 
the air carrier or foreign air carrier that issued the ticket.
     Total Amount: The gross total of funds collected on a 
ticket by the Issuing Carrier for the transportation of a passenger, 
inclusive of taxes and fees imposed by non-carrier entities or air 
carriers, and exclusive of ancillary fees not required to board the 
plane charged by the air carrier.
     Tax Amount:* The portion of the Total Amount that is 
imposed by and remitted to a non-air carrier entity, such as a 
government. This value may also include airport-imposed taxes or fees 
assessed by privately operated airports.
     Exchanged Ticket Indicator:* A record indicator when at 
least one form of payment for the ticket is one or more Coupons of a 
previously issued ticket.

C. Elements for Each Airport in the Ticket Sequence of Travel

     Airport: The IATA/DOT airport code of the station in the 
ticket's sequence of travel that represents the point of embarkation 
for the flight segment indicated by Operating Carrier, Marketing 
Carrier, Scheduled Flight Year, Scheduled Flight Month. The elements 
Dwell Time, and Via Airport would apply to this Airport.
     Operating Carrier: The IATA/DOT designator code for the 
air carrier or foreign air carrier whose aircraft are used to operate 
from the subject airport.
     Marketing Carrier: The IATA/DOT designator code for the 
air carrier or foreign air carrier which marketed the seat on the 
aircraft that is scheduled to depart that appears on the flight segment 
for the subject airport. In the case of a Franchise (contract lift) or 
Marketing Codeshare, the Operating Carrier would be different than the 
Marketing Carrier.
     Scheduled Flight Year:* Departure year in which the flight 
is scheduled to depart the subject Airport.
     Scheduled Flight Month:* Departure Month in which the 
flight is scheduled to depart the subject Airport.
     Dwell Time:* A value that describes the time reported in 
one hour increments between the time a passenger arrived at the subject 
airport and departed from the subject airport. When an itinerary shows 
that the passenger arrives at an airport that is different from the 
departure airport (i.e., there is a surface segment in the itinerary), 
the Dwell Time would still report the elapsed time between arrival and 
departure by air.
     Via Airport(s):* Any points of scheduled stopover or 
connection at airports as part of a ``direct'' or ``through'' flight.

VII. Implementation and Compliance Date

    The Department proposes that the compliance date for these 
improvements to the O&D Survey would be no earlier than one year from 
the publication of the final rule. The Department envisions the 
submission of 12 months of data under Sec. 19-8 for testing and 
validation as sufficient to resolve any problems that may arise in the 
submission and processing of data. DOT seeks comment on what a 
reasonable compliance date would be based on the scope of the proposal 
in this NPRM.
    Carriers would continue to report under Sec. 19-7 until such a time 
that it is determined by DOT that testing and validation of data 
submitted under Sec. 19-8 is complete and suitable to replace data 
collected under Sec. 19-7 as the statistics of record. The Department 
seeks comment on this reporting requirement.

VIII. Regulatory Analysis and Notices

A. E.O. 12866 (Regulatory Planning and Review), E.O. 13563 (Improving 
Regulation and Regulatory Review), E.O. 13771 (Reducing Regulation and 
Controlling Regulatory Costs), and DOT Regulatory Policies and 
Procedures (49 CFR Part 5)

    This rulemaking is not considered a significant regulatory action 
under section 3(f) of E.O. 12866,\14\ as supplemented by E.O. 
13563,\15\ which define a significant regulatory action as one that is 
likely to result in a rule that may have an annual effect on the

[[Page 5060]]

economy of $100 million or more or adversely affect, in a material way, 
the economy, a sector of the economy, productivity, competition, jobs, 
the environment, public health or safety, or State, local, or tribal 
governments or communities. The impact on the economy would be less 
than $100 million; it would create no conflicts with actions taken by 
other agencies; it would not alter budgetary impacts of entitlements, 
grants, fees, or loans; nor would it raise any unusual legal or policy 
issues.
---------------------------------------------------------------------------

    \14\ 58 FR 51735; September 30, 1993.
    \15\ 76 FR 3821; January 21, 2011.
---------------------------------------------------------------------------

    This proposed regulatory action would modify an existing regulation 
and is expected to result in cost savings to producers and users of the 
data as well as to the Federal government. The proposed action is also 
expected to result in benefits to users of the data, including the O&D 
Survey Reporting Carriers themselves.
1. Cost Savings
    The net costs of the proposed rule were determined by comparing the 
costs of the existing system to the projected costs with the proposed 
modification. The Department's analysis identified three primary 
categories of potential cost reductions:
     Cost reductions to data producers: The reduction in the 
costs of producing information for government reporting, due to 
technological simplification of data processing and submission.
     Cost reductions to the government: The reduction in costs 
to edit, manipulate, and validate the O&D data for release.
     Cost reductions to the public/users of the data: The 
reduction in time that users must spend applying specialized analytical 
skills to manipulate and adjust the data to account for current 
deficiencies in the Origin and Destination Survey.
    Cost reductions to data producers include costs for accounting and 
auditing clerks, computer systems analysts, and computer programming 
analysts that are part of the ongoing production of data by the air 
carriers. Labor rates were taken based on Bureau of Labor Statistic's 
Standard Occupational Classification (SOC) and hours were estimated 
based on industry input for current operations. Average cost per 
airline based on the labor rates and estimated hours was then 
calculated, and this was multiplied by the expected number of carriers 
that will report over a 10-year timeframe. The ``as is'' costs were 
then compared to the ``to be'' costs that would be achieved under the 
proposed rule. The ``to be'' costs include the transition costs from 
the current system to the new system as well as an ongoing cost 
estimate for the processing of the data by a third-party fee-for-
service provider. ATPCO, the leading distributor of airline fares and 
airline fare information, notified DOT that it can create software to 
assemble the O&D Survey report for any air carrier that exchanges 
ticket information using their services. ATPCO is a non-profit industry 
consortium that provides tariff services and other ticket-related 
services to air carriers and foreign air carriers ``at-cost.'' ATPCO's 
shared software would relieve air carriers from the cost of maintaining 
separate systems, each of which carries attendant secondary expenses 
for training and technical maintenance. This option would not only 
simplify the information technology operations, but also amortize the 
cost of creating and maintaining the software. Therefore, upfront costs 
resulting from this proposed action are expected to include the 
expenses related to developing, installing, and maintaining an 
automated reporting system. These upfront costs have been accounted for 
as ongoing payments to a third-party provider.
    Cost reductions to the government include systems investment costs 
and ongoing production costs. Labor rates were taken based on Bureau of 
Labor Statistic's Standard Occupational Classification (SOC) and hours 
were based on estimates provided by the Bureau of Transportation 
Statistics (BTS), the agency responsible for the current processing. 
The ``as is'' comparison assumed the use of existing infrastructure 
while the ``to be'' assumed a 2-year development and implementation 
window as well as ongoing production costs.
    Cost reductions to the public/users estimated for the ``as is'' 
total hours users of the data spend on computer systems analysts to 
further prepare the data and the number of hours an analyst may take to 
perform final data quality procedures that must be done to ensure clean 
data for final analysis outputs. The comparison ``to be'' calculation 
includes an estimated investment cost for creating processes for the 
new data prior to its release to public/users.
    All costs were estimated over 10 years and discounted at a 7 
percent rate.

                                             Summary of Cost Savings
----------------------------------------------------------------------------------------------------------------
                                                                    Costs under     Costs under
                           Stakeholder                              the current    the proposed    Cost savings
                                                                    regulation      regulation
----------------------------------------------------------------------------------------------------------------
Regulated Entities (Data Producers).............................      $8,355,747      $7,458,801        $896,946
Government......................................................      18,127,583      10,912,800       7,214,783
Public (Data Users).............................................       2,452,586         196,613       2,255,973
                                                                 -----------------------------------------------
    Total Cost Savings (10 years @7% Discount Rate).............  ..............  ..............      10,367,702
                                                                 -----------------------------------------------
    Annualized Cost Savings.....................................  ..............  ..............       1,476,128
----------------------------------------------------------------------------------------------------------------

    This analysis finds that the proposed modification would result in 
annualized cost savings of approximately $1.5 million at a 7 percent 
discount rate.
2. Implementation and Transition Costs
    To comply with the proposed revised O&D Survey, a certain 
investment is likely necessary by data producers. The proposed 
modification would simplify the design of the O&D Survey sufficiently, 
allowing for third-party providers to create fee-for-service software 
that would produce the Survey reporting records for all air carriers.
3. Benefits to Users of the Data
    Users of the data include both air carriers and industry-related 
entities, such as airports, manufacturers, researchers, and investors, 
who often cite the O&D Survey as one of the most critical datasets used 
to formulate short- and long-term business plans and forecast industry 
trends. Improving the quality of the O&D Survey data would also yield 
several other unquantified benefits to users of the data, including:
     Reporting the Dwell Time between flights would help reduce 
the

[[Page 5061]]

difficulties and potential errors associated with determining when a 
passenger has reached a destination (``Trip Break'') and when the 
passenger is simply waiting for a connecting flight to the intended 
destination.
     Reporting all the cities in the itinerary would better 
align O&D Survey data with the T-100, removing much of the uncertainty 
in market validation analysis. This would allow the T-100 to facilitate 
validation of O&D Survey data submissions.
     Reporting a larger sample size to capture small and rural 
markets with the statistically significant equivalence of larger 
markets would reduce the need to make much less accurate manual 
statistical adjustments as well as increase the accuracy of data 
available for the analysis of small markets.
     Differentiating the amount of tax collected from the 
amount of total fare collected would remove uncertainty in determining 
the actual passenger revenue retained by the airlines.
     Reporting the month and year of travel would enable 
determinations of market trends that are not discernable inside the 
quarterly data reports and would allow direct cross-validation to other 
datasets such as the T-100.
4. Cost-Benefit Analysis Summary

------------------------------------------------------------------------
                                                          10-Year costs
   Major provisions of this             Benefit          (discounted at
       regulatory action                                       7%)
------------------------------------------------------------------------
Change sample size to 40%.....  Would enable more       The estimated
                                 effective oversight     total reduction
                                 of Congressional        in cost over 10
                                 programs designed to    years
                                 help small              discounted at
                                 communities and         7% for all the
                                 provide more accurate   major
                                 market information      provisions
                                 for a wide variety of   would provide a
                                 research and industry   reduction of
                                 uses.                   $10,367,702
                                                         from the cost
                                                         of continuing
                                                         the current
                                                         methodology.*
Report each ticket as a single  Would simplify
 record.                         reporting and
                                 improves quality
                                 assurance.
Designate all certificated air  Would simplify the
 carriers and commuter air       reporting procedures
 carriers holding out            to enable full
 scheduled passenger service     automation of
 as O&D Survey Reporting         reporting, which
 Carriers and require them to    enhances efficiency
 report the tickets that they    and accuracy; and
 sell.                           eliminate loopholes
                                 in collection secure
                                 integrity of the
                                 sample of tickets.
Move to monthly reporting.....  Would create more
                                 useful and timely
                                 economic information;
                                 and align the
                                 reporting process
                                 with the
                                 corresponding
                                 industry accounting
                                 process.
Report the month/year of        Would create more
 travel.                         useful, timely
                                 economic information;
                                 and align reporting
                                 process with the
                                 corresponding
                                 industry accounting
                                 process.
Report all airports in the      Would provide clarity
 itinerary.                      and completeness in
                                 passenger movements.
Report Dwell Time as the        Would allow accurate
 number of hours between each    determination of the
 arrival and next departure in   passenger's intended
 the itinerary.                  destination based on
                                 industry standard
                                 practice.
Report an Exchanged Ticket      Would alert data users
 Indicator.                      that the fare on a
                                 specific ticket may
                                 require further
                                 investigation.
Elimination of Fare Basis Code  Would remove sensitive
 reporting.                      business information
                                 that is burdensome to
                                 report.
Report taxes paid on the        Would inform tax
 ticket.                         policy and allow data
                                 users to separate
                                 taxes paid from the
                                 total fare.
Report a Record Identification  Would enable
 Number.                         communication between
                                 a O&D Survey
                                 Reporting Carrier and
                                 DOT regarding data
                                 quality.
------------------------------------------------------------------------
* The industry requests to align the regulation with current accounting
  practices, which means that the system is to be restructured, so all
  new provisions can be included in a one-time programming cost.

    This proposed rule is expected to be an E.O. 13771 deregulatory 
action.\16\ As is described above in the discussion of the benefit-cost 
analysis that was conducted for the proposed rule, this action is 
expected to result in annualized cost savings (to producers and users 
of the data and the Federal Government) of approximately $1.5 million 
per year, while also yielding additional unquantified benefits to users 
of the data through improved data quality and utility.
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    \16\ 82 FR 9339; Feb. 3, 2017.
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B. The Unfunded Mandates Reform Act of 1995.

    The Unfunded Mandates Reform Act of 1995 \17\ requires Federal 
agencies to prepare a written assessment of the costs, benefits, and 
other effects of proposed or final rules that include a Federal mandate 
likely to result in expenditures by State, local, or tribal 
governments, in the aggregate, or by the private sector, of more than 
$100 million annually. The proposed changes we are considering making 
to the aviation data collections would not result in expenditures by 
State, local, or tribal governments.
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    \17\ 2 U.S.C. 1531-1538.
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C. Regulatory Flexibility Act

    The Regulatory Flexibility Act \18\ requires an agency to assess 
the impacts of proposed and final rules on small entities unless the 
agency determines that a rule is not expected to have a significant 
economic impact on a substantial number of small entities. The 
Department has evaluated the effects of this action on small entities 
and anticipates that the action will not have a significant economic 
impact on a substantial number of small entities.

[[Page 5062]]

The small entities which will begin reporting the data collected under 
this proposed rule routinely collect this data as a normal course of 
business, as a necessity to common industry accounting practices. The 
Department hereby certifies that this action would not have a 
significant economic impact on a substantial number of small entities.
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    \18\ 5 U.S.C. 601 et seq.
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D. E.O. 13132 (Federalism)

    E.O. 13132 \19\ requires agencies to ensure meaningful and timely 
input by State and local officials in the development of regulatory 
policies that may have a substantial, direct effect on the States, on 
the relationship between the National Government and the States, or on 
the distribution of power and responsibilities among the various levels 
of government. The Department has analyzed this action in accordance 
with the principles and criteria contained in E.O. 13132. This rule 
does not include any provision that substantially directly affect the 
States, the relationship between the National Government and the 
States, or the distribution of power and responsibilities among the 
various levels of government. It imposes no direct compliance costs on 
State and local governments nor does it preempt State law. States are 
already preempted from regulating in this area by the Airline 
Deregulation Act.\20\ Therefore, the consultation and funding 
requirements of E.O. 13132 do not apply.
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    \19\ 64 FR 43255; August 10, 1999.
    \20\ 49 U.S.C. 41713.
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E. E.O. 13175 (Consultation and Coordination With Indian Tribal 
Governments)

    The proposed changes to the O&D Survey would not have tribal 
implications, impose substantial direct compliance costs on Indian 
tribal governments, or preempt tribal law. Therefore, this NPRM is 
exempt from the consultation requirements of E.O. 13175, ``Consultation 
and Coordination with Indian Tribal Governments.'' \21\ If tribal 
implications are identified during the comment period, the Department 
will undertake appropriate consultations with the affected Indian 
tribal officials.
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    \21\ 65 FR 67249; November 9, 2000.
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F. Paperwork Reduction Act

    The Paperwork Reduction Act of 1995 (PRA) \22\ requires that the 
Department consider the impact of paperwork and other information 
collection burdens imposed on the public and obtain approval from the 
Office of Management and Budget (OMB) for each collection of 
information it conducts, sponsors, or requires through regulations.
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    \22\ 44 U.S.C. 3501, et seq.
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    This action contains the following proposed amendments to the 
existing information collection requirements previously approved under 
OMB Control Number 2105-AE45. As required by the PRA, DOT has submitted 
these proposed information collection amendments to OMB for its review.
    Summary: Origin-Destination Survey of Airline Passenger Traffic 
(O&D Survey), which collects information on the origin and destination 
of passengers including, at a minimum, information on: (1) The origin 
and destination of passengers in interstate air transportation, and (2) 
the number of passengers traveling by air between any two points in 
interstate air transportation. Modifications to the existing 
requirements would include making the air carrier that issues the 
ticket primarily the carrier responsible for submitting the ticket, 
reporting each ticket as a single record, expanding the O&D Survey 
Reporting Carrier threshold, changing the period of reporting to 
monthly, increasing the sample size to 40 percent, reducing the lag 
time for release of T-100(f), adding dwell time, adding a Via Airport 
data element, adding a Total Tax element, adding Travel Year and Travel 
Month as recorded elements, adding an Exchange Ticket Indicator, adding 
a Reporting Record Identifier, and removing the requirement to record 
the Fare Basis Code.
    Use: The Department is obligated by statute to collect and 
disseminate this information. There are many private and public 
stakeholders that depend on this data to make decisions on aviation 
business and policy. For example, this data is used by the industry to 
plan air services, develop commercial aviation infrastructure, measure 
the economic impact of passenger flows, and create business plans for 
start-up airlines. The O&D Survey is also a primary source of 
information used to quantify and evaluate the effectiveness of Federal 
aviation policy and programs as well as develop and implement new 
policies and infrastructure initiatives.
    Respondents (including number of): All certificated air carriers 
and commuter air carriers holding out scheduled passenger service. The 
Department currently estimates approximately 27 air carriers will 
qualify to submit data to the O&D Survey as envisioned by this 
rulemaking.
    Frequency: Monthly.
    Annual Burden Estimate: The Department is soliciting comments to--
    (1) Evaluate whether the proposed information requirement is 
necessary for the proper performance of the functions of the agency, 
including whether the information will have practical utility;
    (2) Evaluate the accuracy of the agency's estimate of the burden;
    (3) Enhance the quality, utility, and clarity of the information to 
be collected; and
    (4) Minimize the burden of collecting information on those who are 
to respond, including by using appropriate automated, electronic, 
mechanical, or other technological collection techniques or other forms 
of information technology.
    Individuals and organizations may send comments on the information 
collection requirement by March 19, 2021, 11:59 p.m. Eastern Time, and 
should direct them to the address listed in the ADDRESSES section at 
the beginning of this preamble. Comments should also be submitted to 
the Office of Management and Budget, Office of Information and 
Regulatory Affairs, Attention: Desk Officer for OST, New Executive 
Building, Room 10202, 725 17th Street NW, Washington, DC 20053.

G. National Environmental Policy Act

    The Department has analyzed the environmental impacts of this 
proposed action pursuant to the National Environmental Policy Act of 
1969 (NEPA) (42 U.S.C. 4321, et seq.) and has preliminarily determined 
that it is categorically excluded pursuant to DOT Order 5610.1C, 
Procedures for Considering Environmental Impacts (44 FR 56420, Oct. 1, 
1979). Categorical exclusions are actions identified in an agency's 
NEPA implementing procedures that do not normally have a significant 
impact on the environment and therefore do not require either an 
environmental assessment (EA) or environmental impact statement (EIS). 
The purpose of this rulemaking is to update the method of collecting 
and processing aviation traffic data as well as expanding the number of 
reporting air carriers, the sample size collected, and the scope of the 
data reported in the O&D Survey. The Department does not anticipate any 
environmental impacts, and there are no extraordinary circumstances 
present in connection with this rulemaking.

H. Regulation Identifier Number

    2105-AE45.

[[Page 5063]]

List of Subjects

14 CFR Part 241

    Air carriers, Reporting and recordkeeping requirements, Uniform 
system of accounts.

14 CFR Part 298

    Air taxis, Reporting and recordkeeping requirements.

    Issued in Washington, DC.
Elaine L. Chao,
Secretary of Transportation.

Proposed Rule

    Accordingly, the Department proposes to amend 14 CFR parts 241 and 
298 as follows:

PART 241--UNIFORM SYSTEM OF ACCOUNTS AND REPORTS FOR LARGE 
CERTIFICATED AIR CARRIERS

0
1. The authority citation for part 241 continues to read as follows:

    Authority: 49 U.S.C. 329, 41101, 41708, and 41709.

Sec. 19-7  [Removed]

0
2. Remove Sec. 19-7.
0
3. Add Sec. 19-8 to read as follows:

Sec. 19-8  Passenger Origin--Destination Survey applicability.

    (a) All U.S. certificated and commuter air carriers conducting 
scheduled passenger services (except helicopter carriers) shall 
participate in a Passenger Origin-Destination (O&D) Survey covering 
domestic and international air carrier operations, as prescribed by the 
Department's Bureau of Transportation Statistics (BTS), Office of 
Airline Information (OAI).
    (b) A statistically valid sample of flight coupons shall be 
selected for reporting purposes. The sample shall consist of a 
selection of all Tickets involving a Reporting Carrier that meet the 
reporting criteria as defined in the Instructions, or further defined 
in Directives, except those participating O&D carriers with nonstandard 
ticketing procedures, or other special operating characteristics, may 
propose alternative procedures. Such departures from standard O&D 
Survey practices shall not be authorized unless approved in writing by 
the Director, Office of Airline Information under the procedures in 
Sec. 1-2. The data to be recorded and reported, as stipulated in the 
Instructions and Directives, shall include at a minimum the following 
data elements: Reporting Carrier, Reporting Month, Reporting Year, 
Record Identification Number, Issuing Carrier, Total Amount, Tax 
Amount, Exchanged Ticket Indicator, Airport, Operating Carrier, 
Marketing Carrier, Scheduled Flight Year, Scheduled Flight Month, Dwell 
Time and Via Airport(s).
    (c) Any Ticket that is submitted that involves a O&D Survey 
Reporting Carrier providing service in whole or in part under this part 
or 49 U.S.C. 41308 or 41309 and any data covering the operations of 
foreign air carriers that are similar to the information collected in 
the Passenger Origin-Destination Survey are generally not available to 
the Department, the U.S. carriers, or U.S. interests. Therefore, 
because of the damaging competitive impact on U.S. carriers and the 
adverse effect upon the public interest that would result from 
unilateral disclosure of the U.S. survey data, the Department will not 
disclose the international data in the Passenger Origin-Destination 
Survey except:
    (1) To an air carrier directly participating in and contributing 
input data to the Survey or to a legal or consulting firm designated by 
an air carrier to use on its behalf O&D data in connection with a 
specific assignment by such carrier;
    (2) To parties to any proceeding before the Department to the 
extent that such data are relevant and material to the issues in the 
proceeding upon a determination to this effect by the Administrative 
Law Judge or by the Department's decision-maker. Any data to which 
access is granted pursuant to this section may be introduced into 
evidence subject to the normal rules of admissibility of evidence.
    (3) To agencies and other components of the U.S. Government.
    (4) To other persons upon a showing that the release of the data 
will serve specifically identified needs of U.S. users which are 
consistent with U.S. interests.
    (5) To foreign governments and foreign users as provided in formal 
reciprocal arrangements between the foreign and U.S. Governments for 
the exchange of comparable O&D data.
    (6) Or as otherwise determined by the Department as consistent with 
its regulatory functions and responsibilities.
    (d) Each O&D Survey Reporting Carrier shall maintain its prescribed 
reportable records in a manner and at such locations as will permit 
ready accessibility for examination by representatives of DOT. The 
record retention requirements are prescribed in part 249 of this 
chapter.

PART 298--EXEMPTIONS FOR AIR TAXI AND COMMUTER AIR CARRIER 
OPERATIONS

0
4. The authority citation for part 298 continues to read as follows:

    Authority:  49 U.S.C. 329 and chapters 401, 411, and 417.

0
5. In Sec.  298.60, revise paragraph (a) to read as follows:

Sec.  298.60  General reporting instructions.

    (a) Each commuter air carrier and each small certificated air 
carrier shall file the applicable schedules of Form 298-C, ``Report of 
Financial and Operating Statistics for Small Aircraft Operators'', 
Schedule T-100, ``U.S. Air Carrier Traffic and Capacity Data by Nonstop 
Segment and On-Flight Market'', and the ``Passenger Origin--Destination 
Survey'' prescribed in part 241, Sec. 19-8, of this subchapter.
* * * * *

[FR Doc. 2020-29229 Filed 1-15-21; 8:45 am]
BILLING CODE 4910-9X-P