Source: http://thefederalregister.com/2012/11/13/2012-27433.html
Timestamp: 2018-03-17 16:37:57
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Matched Legal Cases: ['art 121', 'art 121', 'art 121', 'art 121', 'art 135', '§ 121', '§ 121', '§ 135', '§ 121', '§ 121', '§ 121', '§ 121', 'art 121', 'art 121', 'art 121', '§ 121', '§ 121', '§ 121', '§ 121', '§ 121', 'art 121', 'art 135', 'art 121', 'art 135', 'art 121', 'art 121', 'art 121', 'art 135', 'art 121', 'art 121', 'art 135', 'art 121', 'art 119', 'art 121', 'art 135', 'art 121', 'art 135', 'art 121', 'art 135', 'art 121', 'art 121', 'art 121', 'art 135', 'art 121', 'art 121', 'art 121', 'art 135', 'arts 121', 'arts 121', 'art 121', 'art 121', 'art 135', 'art 135', 'art 121', 'art 135', 'art 121', 'art 135', 'art 121', '§ 121', '§ 121', '§ 135']

Federal Register | Air Carrier Contract Maintenance Requirements
SUMMARY: The Federal Aviation Administration (FAA) proposes to amend the maintenance regulations for domestic, flag, and supplemental operations, and commuter and on-demand operations for aircraft type certificated with a passenger seating configuration of 10 seats or more (excluding any pilot seat). The proposed rules would require these operators to develop policies, procedures, methods, and instructions for performing contract maintenance that are acceptable to the FAA and to include them in their maintenance manuals. The rules would also require the operators to provide a list to the FAA of all persons with whom they contract their maintenance. These changes are needed because contract maintenance has increased to over 70 percent of all air carrier maintenance, and numerous investigations have shown deficiencies in maintenance performed by contract maintenance providers. The proposals would help ensure consistency between contract and in-house air carrier maintenance and enhance the oversight capabilities of both the air carriers and the FAA.
DATES: Send comments on or before February 11, 2013.
FOR FURTHER INFORMATION CONTACT: For technical questions concerning this action, contact Patricia K. Williams, Aircraft Maintenance Division, Air Carrier Maintenance Branch, AFS-330, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC 20591; telephone (202) 385-6432; emailpatricia.k.williams@faa.gov.
For legal questions concerning this action, contact Ed Averman, Office of the Chief Counsel, Airworthiness, Advanced Aircraft, and Commercial Space Law Branch, AGC-210, Federal Aviation Administration, 800 Independence Avenue SW., Washington, DC; telephone (202) 267-3147; facsimile (202) 267-5106, emailed.averman@faa.gov.
In addition, the “FAA Modernization and Reform Act of 2012” (the Act), Public Law 112-95 (February 14, 2012), in section 319 (Maintenance providers), requires the FAA to issue regulations “requiring that covered work on an aircraft used to provide air transportation under part 121 * * *, be performed by persons in accordance with subsection (b).” Subsection (b), in addition to listing persons authorized under existing regulations, referenced additional terms and conditions in subsection (c) that would apply to persons who provide contract maintenance workers, services, or maintenance functions to a part 121 air carrier for covered work. The Act definescovered work,and mandates that the applicable part 121 air carrier must be directly in charge of covered work being performed for it under contract, and that the work be done under the supervision and control of the air carrier. These statutory requirements are addressed in this proposal.
The proposed amendments would apply to certificate holders who conduct either domestic, flag, or supplemental operations under 14 CFR part 121, and who conduct either commuter operations or on-demand operations with aircraft type certificated for a passenger seating configuration, excluding any pilot seat, of ten seats or more1 under 14 CFR part 135, if they contract any of their maintenance, preventive maintenance, or alteration work to an outside source. The amendments would require that each certificate holder who contracts for such work must first have developed policies, procedures, methods, and instructions for the accomplishment of that work. These must ensure that, if they are followed, the work will be performed in accordance with the certificate holder's maintenance program and maintenance manual. Each certificate holder would also be required to ensure that its system for the continuing analysis and surveillance of that work contains procedures for its oversight. All of these policies, procedures, methods, and instructions would have to be acceptable to the FAA and be included in the certificate holder's maintenance manual. In addition, each certificateholder who contracts any of its maintenance, preventive maintenance, or alteration work to an outside source would be required to provide to its local FAA Certificate Holding District Office a list that includes the name and address of each maintenance provider it uses and a description of the type of maintenance that would be performed.
1For brevity throughout this preamble, we will refer to these aircraft as “10 or more.”
The requirement that any person performing maintenance for an air carrier must follow the carrier's maintenance program is not new—FAA regulations have long required this. For example, § 121.363(b) authorizes a certificate holder to arrange with another person to perform its maintenance,2 and the regulation makes clear that doing so does not relieve the carrier from remaining primarily responsible for the airworthiness of its aircraft. Further, § 121.367(a) requires specifically that maintenance performed by either a certificate holder, or by another person, must be performed in accordance with the certificate holder's manual. Similar provisions are found in §§ 135.413 and 135.425. Despite those general requirements, the Department of Transportation Inspector General (IG) had noted lapses in the means to ensure air carrier manuals are followed when contracted maintenance is performed. The deficiencies noted include a lack of guidance and training for the maintenance providers, and insufficient oversight of that maintenance. The IG reports recommended the FAA develop a means to identify these contract maintenance providers so the agency could better target its inspector resources in surveilling air carrier maintenance. In a separate rulemaking the FAA is proposing mandatory training programs for air carrier maintenance that would have to be approved by the FAA.
2Throughout this preamble, unless otherwise indicated, when we refer to the generic term “maintenance,” the term is meant to include “maintenance, preventive maintenance, and alterations.”
II. Background A. Statement of the Problem
A 2003 Department of Transportation IG report3 identified a trend of air carriers increasingly contracting their maintenance to outside sources such as repair stations. The report revealed that major air carriers spent approximately $1.5 billion on outsourced maintenance in 1996 and approximately $2.5 billion in 2002. The report attributed the trend to cost savings that can be realized by air carriers contracting their maintenance to outside repair facilities. The report was based, in part, on investigators' visits to several FAA field offices and to 21 repair stations to evaluate the effectiveness of the FAA's oversight of the maintenance work being performed for air carriers. The investigation identified weaknesses in maintenance practices at 15 of the 21 repair stations and concluded that a lack of FAA oversight, especially for repeat issues, contributed to the deficiencies. The IG report made several recommendations on ways the FAA could enhance the effectiveness of its oversight of air carrier contracted maintenance. Among them was that the FAA should develop a process to identify repair stations air carriers use to perform aircraft maintenance, and to target FAA inspector resources based on risk assessments or analysis of the data collected on air carrier maintenance outsourcing practices (Recommendation 2).
3 Review of Air Carriers' Use of Aircraft Repair Stations,Report No. AV-2003-047 (July 8, 2003).
In 2005, the IG issued a second report on air carriers' use of outside maintenance providers4 —this one reporting on the use of non-certificated repair facilities. The report discussed aircarriers' use of both non-certificated facilities (i.e.,maintenance facilities not certificated by the FAA as repair stations) and individual mechanics hired on a temporary basis. The report echoed a recommendation from the 2003 IG report by recommending that the FAA inventory air carrier vendor lists that include all maintenance providers working on air carrier aircraft and identify non-certificated repair facilities that perform critical or scheduled maintenance (Recommendation 1). The report also recommended that the FAA determine whether air carriers evaluate the background, experience, and qualifications of the temporary maintenance personnel used by the contractors to ensure the work they perform is completed in accordance with FAA and air carrier requirements (Recommendation 7).
4 Air Carrier's Outsourcing Use of Non-Certificated Repair Facilities,Report No. AV-2006-031 (Dec. 15, 2005).
The problem areas discussed above were emphasized at Congressional hearings in testimony by the Inspector General in 2007. The Inspector General stated: “If FAA is to achieve the planned improvements in oversight of outsourced maintenance, it will need to obtain definitive data on where air carriers are getting the maintenance performed, including critical and scheduled maintenance work done at non-certificated repair facilities, so that it can focus its inspections to areas of greatest risk.”5
5Scovel, Aviation Safety, FAA Oversight of Repair Stations, June 20, 2007, CC 2007-076 Senate Committee on Science, Transportation and Commerce, Subcommittee on Operations, Safety and Security.
In 2008, the IG issued a third related report on air carriers' outsourcing of maintenance.6 The report noted a continuing trend of air carriers outsourcing more of their maintenance. The IG based this report on its review of nine major air carriers, which sent 71% of their heavy maintenance checks to repair stations in 2007—up from 34% in 2003.7 The report pointed out the continuing need for better oversight of contract maintenance, both by the FAA and by air carriers, especially when the air carriers are contracting repairs of critical components. In addition, the report found that air carrier maintenance manuals have traditionally been geared toward in-house maintenance, and noted that repair stations may perform work for various air carriers, all with different in-house procedures. In this regard, the report concluded that the FAA should ensure that air carriers provide well-defined maintenance procedures and guidance for their outsourced repairs. The report specifically recommended that the FAA: “Encourage the industry best practice of using airworthiness agreements between air carriers and repair stations that more closely define maintenance procedures and responsibilities” (Recommendation 7).
6 Air Carrier's Outsourcing of Aircraft Maintenance,Report No. AV-2008-090 (Sept. 30, 2008).
7The report noted that, “overall, major air carriers outsourced an average of 64 percent of their maintenance expenses in 2007, compared to only 37 percent in 1996.” Report No. AV-2008-090 (Sept. 30, 2008) at p. 1.
As noted in the IG reports discussed above, air carrier use of contract maintenance providers continues to grow, averaging 64% of air carrier maintenance costs in 2007. The air carrier regulations have long stipulated that each certificate holder is primarily responsible for the airworthiness of its aircraft, even if maintenance is contracted to another person. (See§§ 121.363 and 135.413.) Air carriers cannot abrogate this responsibility. Consistent with this responsibility are the requirements that when persons other than the certificate holder (i.e.,contract maintenance providers) perform maintenance for it, the maintenance must be performed in accordance with the certificate holder's maintenance manual.
Section 121.367 has long required that each certificate holder shall have a maintenance program that ensures that: “Maintenance, preventive maintenance, and alterations performed by it,or by other persons,are performed in accordance with the certificate holder's manual.” (§§ 121.367(a) and 135.425(a) (emphasis added).) And, current § 121.369(b) requires, in pertinent part, that:
While the current regulations do require that any person (whether certificated or not) with whom an air carrier arranges to perform maintenance must follow the carrier's manual, the requirement is broadly stated and often loosely implemented. In order to assure consistency in any future FAA guidance material, we are proposing in new §§ 121.368 and 135.426 to define amaintenance provideras any person (whether certificated or not) who performs maintenance for a certificate holder other than a person who is trained by and employed by that certificate holder. These new sections would also require each air carrier that contracts any part of its maintenance to a maintenance provider to first have policies and procedures in place to ensure that, if they were followed, the carrier's contracted maintenance would be performed in accordance with its maintenance program and maintenance manual. Proprietary data issues could be addressed by carefully drafted airworthiness agreements between the air carrier and its maintenance provider, as recommended in the 2008 IG report. Each certificate holder would also be required to ensure that its system for the continuing analysis and surveillance of that work contains procedures for its oversight. All of these policies, procedures, methods, and instructions would have to be acceptable to the FAA and be included in the certificate holder's maintenance manual.
In addition, as explained in the Authority for this Rulemaking section of this preamble, the “FAA Modernization and Reform Act of 2012” (the Act), Public Law 112-95 (February 14, 2012), in section 319 (Maintenance providers), requires the FAA to issue regulations “requiring that covered work on an aircraft used to provide air transportation under part 121 * * *, be performed by persons in accordancewith subsection (b).” Subsection (b) of the Act, in addition to listing persons already authorized to perform maintenance under existing regulations, referenced additional terms and conditions in subsection (c) that would apply to persons who provide contract maintenance workers, services, or maintenance functions to a part 121 air carrier for the performance of covered work. The Act definescovered workas any of the following: “(A) Essential maintenance that could result in a failure, malfunction, or defect endangering the safe operation of an aircraft if not performed properly or if improper materials are used. (B) Regularly scheduled maintenance. (C) A required inspection item (as defined by the Administrator).” The Act also requires that covered work be carried out under thesupervision and controlof the part 121 air carrierdirectly in chargeof the covered work being performed for it by a maintenance provider, and that the covered work be carried out in accordance with the air carrier's maintenance manual.
In accordance with these statutory requirements, we are proposing to include in §§ 121.368(a) and 135.426(a) the definition ofcovered workset forth in the statute, and to provide definitions ofsupervision and controlanddirectly in charge.The definition ofdirectly in chargewould be similar to the current definitions in §§ 121.378 and 135.435. As required by the statute, we are also proposing: In §§ 121.368(b) and 135.426(b), that each certificate holder must be directly in charge of all covered work it contracts to a maintenance provider; in §§ 121.368(c) and 135.426(c), that all covered work must be carried out in accordance with the certificate holder's maintenance manual; and in §§ 121.368(d) and 135.426(d), that no covered work may be performed by a maintenance provider unless that work is carried out under the supervision and control of the certificate holder. Although the statute mandates these amendments for part 121 air carriers, the FAA believes that, in the interest of providing an equivalent level of safety for commuter and on demand operations, the same requirements should apply to persons conducting operations under part 135 in aircraft configured with 10 or more passenger seats. Accordingly, we are proposing the changes mandated by the Act for both part 121 and part 135 (10 or more) certificate holders.
In addition, this proposed rule responds to a provision (Section 319 on Maintenance Providers) in the FAA Modernization and Reform Act of 2012 mandating that the FAA issue regulations “requiring that covered work on an aircraft used to provide air transportation under part 121 * * *, be performed by persons in accordance with subsection (b) [of that section].” Subsection (b), in addition to listing persons authorized under existing regulations, referenced additional terms and conditions in subsection (c) that would apply to persons who provide contract maintenance workers, services, or maintenance functions to a part 121 air carrier for covered work. The section definescovered work,and mandates that the applicable part 121 air carrier must be directly in charge of covered work being performed for it under contract, and that the work be done under the supervision and control of the air carrier. As already explained under Discussion of the Proposal in this preamble, in the interest of providing an equivalent level of safety for commuter and on demand operations, we are proposing the above statutory requirements for certificate holders operating under part 135 as well as for those operating under part 121.
• The rule is expected to take effect in 2014. The time horizon for these potential benefits is 10 years, 2014 through 2023.
• All monetary values were expressed in constant 2011 dollars. We calculated the present value of the potential benefit stream by discounting the monetary values using a 7 percent interest rate from 2014 to 2023.
• The FAA identified 301 part 121 and part 135 (10 or more) air carriers that would be affected by this proposed rule.
Title II of the Unfunded Mandates Reform Act of 1995 (Pub. L. 104-4) requires each Federal agency to prepare a written statement assessing the effects of any Federal mandate in a proposed or final agency rule that may result in an expenditure of $100 million or more (in 1995 dollars) in any one year by State, local, and tribal governments, in the aggregate, or by the private sector; such a mandate is deemed to be a “significant regulatory action.” The FAA currently uses an inflation-adjusted value of $143.1 million instead of $100 million. This proposed rule does not contain such a mandate; therefore, therequirements of Title II of the Act do not apply.
Summary:Each operator which seeks to obtain, or is in possession of, an air carrier operating certificate must comply with the requirements of 14 CFR part 121 in order to maintain data which is used to determine if the air carrier is operating in accordance with minimum safety standards. Original certification is completed in accordance with part 119.
Use:This information collection supports the Department of Transportation's strategic goal of safety. Specifically, the goal is to promote the public health and safety by working toward the elimination of transportation-related deaths, injuries, and destruction of property.
Respondents (including number of):There are approximately 94 part 121 air carriers and 207 part 135 operators affected by this proposed rule.
Frequency:The manual requirements will be submitted as part of the submission of maintenance manuals to the FAA for acceptance.
Annual Burden Estimate:The proposed rule would require that the air carrier's manual has all the policies, procedures, methods, and instructions for the accomplishment of maintenance by another person to include the information necessary for certificate holders to ensure all maintenance is performed in accordance with its maintenance program. The proposed rule would also require that the air carrier provides a list with the name and address of each maintenance provider used and the type of maintenance that is to be performed.
• 94 part 121 manuals have to be revised in year 1.
• 207 part 135 manuals have to be revised in year 1.
• 94 part 121 air carriers have to provide a list in year 1.
• 207 part 135 air carriers have to provide a list in year 1.
• Part 121: amount of time revising manual (manager): 4 hours.
• Part 121: amount of time revising manual (technical writer): 40 hours.
• Part 121: amount of time revising manual (editor): 2 hours.
• Part 135: amount of time revising manual (manager): 8 hours.
• Part 121: amount of time to provide the list (manager): 1 hour.
• Part 121: amount of time to provide the list (technical writer): 3 hours.
• Part 121: amount of time to provide the list (auditor): 10 hours.
• Part 135: amount of time to provide the list (manager): 5 hours.
• Parts 121 & 135: amount of time to maintain list (manager): 6 hours/year.
• Parts 121 & 135: amount of time to maintain list (technical writer): 6 hours/year.
• Wage per hour for manager: $69.78.
• Wage per hour for technical writer: $36.76.
• Wage per hour for editor: $43.45.
• Wage per hour for auditor: $49.79.
First Year Costs for Part 121 Cost = 94 × ((4 hours × $69.78) + (40 hours × $36.76) + (2 hours × $43.45) + (1 hour × $69.78) + (3 hours × $36.76) + (10 hours × $49.79) + (6 hours × $69.78) + (6 hours × $36.76)) = $296,454. Time = 94 × (4 hours + 40 hours + 2 hours + 1 hour + 3 hours + 10 hours + 6 hours + 6 hours) = 6,768. Subsequent Year Costs for Part 121 Cost = 94 × ((6 hours × $69.78) + (6 hours × $36.76)) = $60,091. Time = 94 × (6 hours + 6 hours) = 1,128. First Year Costs for Part 135 Cost = 207 × ((8 hours × $69.78) + (5 hours × $69.78) + (6 hours × $69.78) + (6 hours × $36.76)) = $320,114. Time = 207 × (8 hours + 5 hours + 6 hours + 6 hours) = 5,175. Subsequent Year Costs for Part 135 Cost = 207 × ((6 hours × $69.78) + (6 hours × $36.76)) = $132,329. Time = 207 × (6 hours + 6 hours) = 2,484. Total Over 10 Years Cost = ($296,454 + $320,114 + (9 × $60,091) + (9 × $132,329)) = $2,348,351. Time = (6,768 hours + 5,175 hours + (9 × 1,128 hours) + (9 × 2,484 hours)) = 44,451. Average Per Year Cost = $2,348,351/10 = $234,835. Time = 44,451/10 = 4,445 hours. FAA Costs
• Part 121: amount of time revising manual (FAA inspector): 1 hour.
• Part 135: amount of time revising manual (FAA inspector): 1 hour.
• Wage per hour for FAA inspector: $96.14.
First Year Costs for Part 121 Cost = 94 × ((1 hour × $96.14)) = $9,037. Time = 94 × (1 hour) = 94 hours. First Year Costs for Part 135 Cost = 207 × ((1 hour × $96.14)) = $19,901. Time = 207 × (1 hour) = 207 hours. Total Over 10 Years Cost = ($9,037 + $19,901) = $28,938. Time = (94 hours + 207 hours) = 301 hours. Average Per Year Cost = $28,938/10 = $2,894. Time = 301/10 = 30 hours.
Individuals and organizations may send comments on the information collection requirement to the address listed in theADDRESSESsection at the beginning of this preamble by February 11, 2013.Comments also should be submitted to the Office of Management and Budget, Office of Information and Regulatory Affairs, Attention: Desk Officer for FAA, New Executive Office Building, Room 10202, 725 17th Street NW., Washington, DC 20053.
V. Executive Order Determinations A. Executive Order 13132, Federalism
List of Subjects 14 CFR Part 121
§ 121.368 Contract maintenance.
(1) Amaintenance provideris any person who performs maintenance, preventive maintenance, or an alteration for a certificate holder other than a person who is trained by and employed directly by that certificate holder.
(2)Covered workmeans any of the following:
(3)Directly in chargemeans having responsibility for covered work performed by a maintenance provider. A representative of the certificate holder directly in charge of covered work does not need to physically observe and direct each maintenance provider constantly, but must be available for consultation on matters requiring instruction or decision.
(4)Supervision and controlmeans that a representative of the certificate holder must be available to personally observe the covered work being done to the extent necessary to ensure it is being done properly, and when the representative is not physically present to observe the work, the representative must be available for consultation on matters requiring instruction or decision.
§ 121.369 Manual requirements.
§ 135.426 Contract maintenance.