Transportation Programs: Challenges Facing the Department of Transportation and Congress
Published: 2009-03-10T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: A safe, efficient, and convenient transportation system is integral to the health of our economy and quality of life. Our nation's vast transportation system of airways, railways, roads, transit systems, and waterways has served this need, yet is under considerable pressure due to increasing congestion and costs to maintain and improve the system. Calls for increased investment come at a time when traditional funding for transportation projects is increasingly strained. The authorizing legislation supporting transportation programs will soon expire. The Department of Transportation (DOT) implements national transportation policy and administers most federal transportation programs. DOT received funds for transportation infrastructure projects through the American Recovery and Reinvestment Act of 2009 to aid in economic recovery. DOT also requested $72.5 billion to carry out its activities for fiscal year 2010. This statement presents GAO's views on major challenges facing DOT and Congress as they work to administer recovery funds and reauthorize surface transportation and aviation programs. It is based on work GAO has completed over the last several years. GAO has made recommendations to DOT to improve transportation programs; the agency has generally agreed with these recommendations. To supplement this existing work, GAO obtained information on the recovery funds provided to DOT.
section_title: What GAO Found
paragraphs: The Department of Transportation received about $48 billion of recovery funds for investments in transportation infrastructure from the American Recovery and Reinvestment Act of 2009. As with other executive agencies, DOT is faced with the challenges of using these funds in ways that will aid economic recovery, making wise funding choices while spending the money quickly, and ensuring accountability for results. GAO will report to Congress bimonthly on how states and localities use the recovery funds received from DOT. DOT and Congress will also be faced with numerous challenges as they work to reauthorize surface transportation and aviation programs. Funding the nation's transportation system. Revenues to support the Highway Trust Fund are not keeping pace with spending levels and the Highway Account was nearly depleted last summer. In addition, the excise taxes that fund Airport and Airway Trust Fund revenues have been lower than previously forecasted, and forecasts of future revenues have declined. Declining revenues in both trust funds may adversely affect DOT's ability to continue to fund surface transportation and aviation programs at levels previously assumed. Improving transportation safety. Although the number of traffic crashes and the associated fatality rate has decreased over the last 10 years, the number of fatalities has remained at about 42,000 annually. The continued high level of fatalities and difficulties experienced by states in implementing grant programs raise issues for Congress to consider in restructuring these programs during reauthorization. While the U.S. commercial aviation industry is among the safest in the world, accidents can have catastrophic consequences. The lack of performance measures and complete data limit DOT's ability to improve safety and manage safety risks. Improving transportation mobility. Despite large increases in transportation spending, congestion on our nation's highways has increased over the last 10 years and increased demand will further strain the system. Flight delays and cancellations at congested airports continue to plague the U.S. aviation system. For example, almost one in four flights either arrived late or was canceled in 2008, and the average flight delay increased despite a 6 percent annual decline in the total number of operations through December 2008. Congestion poses serious economic as well as environmental and health concerns for the nation. Transforming the nation's air traffic control system. The air traffic control modernization program is technically complex and costly. The Federal Aviation Administration will need to accelerate the implementation of new and existing technologies, consider incentives for aircraft operators to acquire those technologies, and sustain the current system while transitioning to the new one, among other things.

section_title: Letter
paragraphs: We appreciate the opportunity to participate in this hearing to discuss the  challenges facing the Department of Transportation (DOT) and Congress  as they work to aid economic recovery and address the reauthorization of  the surface transportation and aviation programs. A safe, efficient, and  convenient transportation system is critical to the nation’s economy and  affects the daily life of most Americans. However, this system is under  pressure, and estimates to repair, replace, or upgrade aging  infrastructure—as well as expand capacity to meet increased demand— top hundreds of billions of dollars. Calls for increased investment in  transportation coincide with growing strains on traditional funding for  transportation projects. For example, revenues to support the Highway  Trust Fund are not keeping pace with spending levels, and the fund’s  Highway Account was nearly depleted last summer. Similarly, excise tax  revenues to support the Airport and Airway Trust Fund have been lower  than previously forecasted, a trend which is likely to continue given the  downturn in the economy. The federal government’s current financial  condition and the nation’s weakening economy will further strain funding  sources for transportation projects.
DOT will immediately be faced with overseeing the distribution of  economic stimulus funds that were provided in the American Recovery  and Reinvestment Act of 2009 to states and localities. Congress and DOT  will also soon face the challenge of allocating federal resources to meet  demands for a wide range of surface transportation infrastructure  projects, as the current authorization of federal surface transportation  programs expires at the end of fiscal year 2009. Furthermore, federal  aviation programs have been operating under a series of funding  extensions since the authorizing legislation expired at the end of fiscal  year 2007. Timely reauthorization is critical to ensuring the continuity of  the Federal Aviation Administration’s (FAA) current programs and  progress in transforming the nation’s air traffic control system. DOT faces  these challenges with few officials named or confirmed to appointed  posts.
My statement is primarily based on work that we have completed over the  past several years. (A list of related GAO products is included with this  statement.) To supplement our existing work, we also obtained  information on the American Recovery and Investment Act of 2009 and the  President’s budget for the Department of Transportation for fiscal year  2010.
subsections: section_title: Background
paragraphs: The safe, efficient, and convenient movement of people and goods  depends on a vibrant transportation system. Our nation has built vast  systems of roads, airways, railways, transit systems, pipelines, and  waterways that facilitate commerce and improve our quality of life.  However, these systems are under considerable strain due to increasing  congestion and the costs of maintaining and improving the systems. This  strain is expected to increase as the demand to move people and goods  grows resulting from population growth, technological change, and the  increased globalization of the economy.
DOT implements national transportation policy and administers most  federal transportation programs. Its responsibilities are considerable and  reflect the extraordinary scale, use, and impact of the nation’s  transportation systems. DOT has multiple missions—primarily focusing on  mobility and safety—that are carried out by several operating  administrations. (See table 1.) For fiscal year 2010, the President’s budget  requested $72.5 billion to carry out these and other activities.
DOT carries out some activities directly, such as employing more than  15,000 air traffic controllers to coordinate air traffic. However, the vast  majority of the programs it supports are not under its direct control.  Rather, the recipients of transportation funds, such as state departments  of transportation, implement most transportation programs. For example,  the Federal Highway Administration (FHWA) provides funds to state  governments each year to improve roads and bridges and meet other  transportation demands, but state and local governments decide which  transportation projects have high priority within their political  jurisdictions.
We have previously reported that current surface transportation  programs—authorized in the Safe, Accountable, Flexible, Efficient  Transportation Equity Act: A Legacy for Users (SAFETEA-LU)—do not  effectively address the transportation challenges the nation faces. As a  result, we have called for a fundamental reexamination of the nation’s  surface transportation programs to (1) have well-defined goals with direct  links to an identified federal interest and federal role, (2) institute  processes to make grantees more accountable by establishing more  performance-based links between funding and program outcomes, (3)  institute tools and approaches that emphasize the return on the federal  investment, and (4) address the current imbalance between federal surface  transportation revenues and spending.
We have also called for a timely reauthorization of FAA programs that  expired at the end of fiscal year 2007 and have continued under a series of  funding extensions. Such short-term funding measures could delay key  capital projects and may affect FAA’s current programs and progress  toward the Next Generation Air Transportation System.
section_title: Aiding Economic Recovery and Ensuring Accountability for Recovery Funds’ Use
paragraphs: Congress and the presidential administration have fashioned the American  Recovery and Reinvestment Act of 2009 to help our nation respond to  what is generally reported to be the worst economic crisis since the Great  Depression. DOT received about $48 billion of these funds for investments  in transportation infrastructure—primarily for highways, passenger rail,  and transit—mostly for use through fiscal year 2010. (See table 2.) As with  other executive agencies, DOT now faces the challenges of using these  funds in ways that aid economic recovery, making wise funding choices  while spending the money quickly, and ensuring accountability for results.
The act largely provided for increased transportation funding through existing  programs—such as the Federal-Aid Highways, the New Starts transit, and the  Airport Improvement programs. Channeling funding through existing  programs should allow DOT to jump start its spending of recovery funds.  However, there is a need to balance the requirement in the recovery act to get  funds out quickly to help turn around the economy with the equally powerful  need to make sure that funds are spent wisely on infrastructure investments  and are not subject to waste, fraud, and abuse.
We have reported on important design criteria for any economic stimulus  package including that it be timely, temporary, and targeted. This is a difficult  challenge for transportation infrastructure projects. First, they require  lengthy planning and design periods. According to the Congressional Budget  Office (CBO), even those projects that are “on the shelf” generally cannot be  undertaken quickly enough to provide a timely stimulus to the economy.
Second, spending on transportation infrastructure is generally not temporary  because of the extended time frames needed to complete projects. Third,  because of differences among states, it is challenging to target stimulus  funding to areas with the greatest economic and infrastructure needs.
The act will substantially increase the federal investment in the nation’s  surface transportation system. However, the current federal approach to  addressing the nation’s surface transportation problems is not working well.  Many existing surface transportation programs are not effective at addressing  key challenges because goals are numerous and sometimes conflicting, roles  are unclear, programs lack links to the performance of the transportation  system or of the grantees, and programs in some areas do not use the best  tools and approaches to ensure effective investment decisions and the best  use of federal dollars. In addition, evidence suggests that increased federal  highway grants influence states and localities to substitute federal funds for  state and local funds they otherwise would have spent on highways. In 2004,  we estimated that states used roughly half of the increases in federal highway  grants since 1982 to substitute for state and local highway funding, and that  the rate of substitution increased during the 1990s. Our work has also shown  that there is still room for improved oversight in surface transportation  programs including the Federal-Aid Highway program. For example, we and  the DOT Inspector General have each recommended that FHWA develop the  capability to track and measure the costs of federally-aided projects over  time.
Among other things, the act gives our office the responsibility of reporting  to Congress bimonthly on how selected states and localities are using the  recovery funds. We will work with the department’s Office of Inspector  General and with the state and local audit community to coordinate our  activities. We also anticipate that committees of jurisdiction will request  that we assess specific issues related to the department’s use of recovery  funds. We look forward to working with this subcommittee and others to  meet Congress’s needs.
section_title: Addressing Funding, Safety, Mobility, and Modernization Challenges in Surface Transportation and Aviation Reauthorization Efforts
paragraphs: DOT and Congress will be faced with numerous challenges as they work  to reauthorize the surface transportation and aviation programs. In  particular, the department and Congress will need to address challenges in  (1) ensuring that the nation’s surface transportation and aviation systems  have adequate funding, (2) improving safety, (3) improving mobility, and  (4) transforming the nation’s air traffic control system. Surface  transportation program funding is one of the issues on our high-risk list.
subsections: section_title: Funding the Nation’s Transportation System
paragraphs: Revenues from motor fuels taxes and truck-related taxes to support the  Highway Trust Fund—the primary source of funds for highway and  transit—are not keeping pace with spending levels. This fact was made  dramatically apparent last summer when the Highway Account within the  trust fund was nearly depleted. The balance of the Highway Account has  been declining in recent years because, as designed in SAFETEA-LU,  outlays from the account exceed expected receipts over the authorization  period. Specifically, when SAFETEA-LU was passed in 2005 estimated  outlays from Highway Account programs exceeded estimated receipts by  about $10.4 billion. Based on these estimates, the Highway Account  balance would have been drawn down from $10.8 billion to about $0.4  billion over the authorization period. This left little room for error.  Assuming all outlays were spent, a revenue shortfall of even 1 percent  below what SAFETEA-LU had predicted over the 5-year period would  result in a cash shortfall in the account balance.
In fact, actual Highway Account receipts were lower than had been  estimated, particularly for fiscal year 2008. Account receipts were lower in  fiscal year 2008 due to a weakening economy and higher motor fuel prices  that affected key sources of Highway Trust Fund revenue. For example,  fewer truck sales, as well as fewer vehicle miles traveled and  correspondingly lower motor fuel purchases resulted in lower revenues.  As a result, the account balance dropped more precipitously than had  been anticipated and was nearly depleted in August 2008—1 year earlier  than the end of the SAFETEA-LU authorization period. In response,  Congress passed legislation in September 2008 to provide $8 billion to  replenish the account. However, according to CBO, the account could  reach a critical stage again before the end of fiscal year 2009. Without  either reduced expenditures or increased revenues, or a combination of  the two, shortfalls will continue.
In the past, we have reported on several strategies that could be used to  better align surface transportation expenditures and revenue. Each of  these strategies has different merits and challenges, and the selection of  any strategy will likely involve trade-offs among different policy goals. The  strategies related to funding sources are also included in the recent report  from the National Surface Transportation Infrastructure Financing  Commission.
Altering existing sources of revenue. The Highway Account’s current  sources of revenue—motor fuel taxes and truck-related taxes—could be  better aligned with actual outlays. According to CBO and others, the  existing fuel taxes could be altered in a variety of ways to address the  erosion of purchasing power caused by inflation, including increasing the  per-gallon tax rate and indexing the rates to inflation.
Ensure users are paying fully for benefits. Revenues can also be designed  to more closely follow the user-pay concept—that is, require users to pay  directly for the cost of the infrastructure they use. This concept seeks to  ensure that those who use and benefit from the infrastructure are charged  commensurately. Although current per-gallon fuel taxes reflect usage to a  certain extent, these taxes are not aligned closely with usage and do not  convey to drivers the full costs of road use—such as the costs of  congestion and pollution. We have reported that other user-pay  mechanisms—for example, charging according to vehicle miles traveled,  tolling, implementing new freight fees for trucks, and introducing  congestion pricing (pricing that reflects the greater cost of traveling at  peak times)—could more equitably recoup costs.
Supplement existing revenue sources. We have also reported on strategies  to supplement existing revenue sources. A number of alternative financing  mechanisms—such as enhanced private-sector participation—can be used  to help state and local governments finance surface transportation. These  mechanisms, where appropriate, could help meet growing and costly  transportation demands. However, these potential financing sources are  forms of debt that must ultimately be repaid.
Reexamine the base. Given the federal government’s fiscal outlook, we  have reported that we cannot accept all of the federal government’s  existing programs, policies, and activities as “givens.” Rather, we need to  rethink existing programs, policies, and activities by reviewing their  results relative to the national interests and by testing their continued  relevance and relative priority.
Improve the efficiency of current facilities. Finally, better managing  existing system capacity and improving performance of existing facilities  could minimize the need for additional expenditures. We have reported  that the efficiency of the nation’s surface transportation programs are  declining and that the return on investment could be improved in a  number of ways, including creating incentives to better use existing  infrastructure.
In addition to better aligning revenues and outlays, improving existing  mechanisms that are intended to help maintain Highway Account solvency  could help DOT better monitor and manage the account balance, thereby  reducing the likelihood of a funding shortfall. For example, statutory  mechanisms designed to make annual adjustments to the Highway  Account have been modified over time—particularly through changes in  SAFETEA-LU—to the extent that these mechanisms either are no longer  relevant or are limited in effectiveness. Furthermore, monitoring  indicators throughout the year that could signal sudden changes in the  Highway Account revenues could help DOT better anticipate potential  changes in the account balance that should be communicated to Congress,  state officials, and other stakeholders. We recently made  recommendations to help DOT improve solvency mechanisms for the  Highway Account and communication on the account’s status with  stakeholders.
Turning to aviation funding, the excise taxes that fund Airport and Airway  Trust Fund revenues have been lower than previously forecasted, and  forecasts of future revenues have declined because of a decline in airline  passenger travel, fares, and fuel consumption. Moreover, the  uncommitted balance in the Trust Fund has decreased since fiscal year  2001. (See fig. 2). For the short run, lower-than-expected excise tax  revenues will reduce the Trust Fund balance even further and could affect  funding for FAA programs this year and next. In the longer run, continued  declines in Trust Fund revenues may require Congress to reduce spending  on FAA operations and capital projects, increase revenues for the trust  fund by introducing new fees or increasing taxes, or increase FAA’s  funding provided by the General Fund.
section_title: Improving Transportation Safety
paragraphs: Improvements in transportation safety are needed to reduce the number of  deaths and injuries from transportation accidents, the vast majority of  which occur on our nation’s roads. We recently reported that although the  number of traffic crashes and the associated fatality rates has decreased  over the last 10 years, the number of fatalities has, unfortunately, remained  at about 42,000 annually and some areas are of particular concern. For  example, in 2007, over half of the passenger vehicle occupants killed were  not using safety belts or other proper restraint, nearly one-third of the total  fatalities were in alcohol-impaired driving crashes, and motorcyclist  fatalities increased for the 10th year in a row.
While the U.S. commercial aviation industry is among the safest in the  world, aviation safety is also a major concern because when accidents or  serious incidents occur they can have catastrophic consequences.
Moreover, last year there were 25 serious runway incursions—nine of  these involved commercial aircraft—when collisions between aircraft on  runways were narrowly avoided. Runway incursions can be considered a  precursor to aviation accidents. Figure 4 shows the number of serious  incursions involving commercial aircraft from fiscal year 2001 through  fiscal year 2008.
DOT has taken steps to address surface and aviation safety concerns. To  improve traffic safety, the National Highway Traffic Safety Administration  (NHTSA) has made substantial progress in administering traffic safety  grant programs and high-visibility enforcement programs which, according  to state safety officials, are helping them address key traffic safety issues,  such as safety belt use and alcohol-impaired driving. NHTSA has also  taken steps to improve the consistency of its process for reviewing states’  management of traffic safety grants. To maintain and expand the margin of  safety within the national airspace system, FAA is moving to a system  safety approach to oversight and has established risk-based, data-driven  safety programs to oversee the aviation industry. FAA has also taken  recent actions to improve runway safety, including conducting safety  reviews at airports and establishing an FAA-industry team to analyze the  root causes of serious incursions and recommend runway safety  improvements.
Despite NHTSA’s progress in administering and overseeing traffic safety  programs, several challenges may limit the effectiveness of the programs  and NHTSA’s ability to measure and oversee program effectiveness:    The grant programs generally lack performance accountability  mechanisms to tie state performance to receipt of grants.
Some states have faced challenges passing legislation required to qualify  for some traffic safety incentive grants.
Each safety incentive grant has a separate application process, which has  proven challenging for some states to manage, especially those with small  safety offices.
Some states also would have preferred more flexibility in using the safety  incentive grants to focus on key safety issues within the state.
Over the past several years, we have made recommendations to help  NHTSA further improve its ability to measure and oversee surface traffic  safety programs and to help FAA improve its oversight of aviation safety.  However, some challenges related to traffic safety—such as state  challenges in administering the programs and the lack of performance  accountability measures—result from the structure of the grant programs  established under SAFETEA-LU. These challenges and the persistence of  substantial numbers of traffic fatalities nationwide raise issues for  Congress to consider in restructuring surface traffic safety programs  during the upcoming reauthorization. Furthermore, to maintain the high  level of safety in the aviation industry, FAA needs to address challenges in  accessing complete and accurate aviation safety data, and improving  runway and ramp safety. For example, recent actions by some major  airlines to discontinue participation in an important data reporting  program limit data access. Moreover, a lack of national data on operations  involving air ambulances, air cargo, and general aviation hinders FAA’s  ability to evaluate accident trends and manage risks in these sectors.  Improving runway safety will require a sustained effort by FAA that  includes developing new technologies and revised procedures to address  human factors issues, such as fatigue and distraction, which experts have  identified as the primary cause of incursions.
section_title: Improving Transportation Mobility
paragraphs: Congestion has worsened over the past 10 years, despite large increases in  transportation spending at all levels of government and improvements to  the physical condition of highways and transit facilities. Furthermore,  according to DOT, highway spending by all levels of government has  increased 100 percent in real dollar terms since 1980, but the hours of  delay during peak travel periods have increased by almost 200 percent  during the same period. These mobility issues have increased at a  relatively constant rate over the last two decades. (See table 3.)
In addition, demand has outpaced the capacity of the system, and  projected population growth, technological changes, and increased  globalization are expected to further strain the system. Likewise,  increased demand and capacity constraints have threatened the mobility  of the nation’s freight transportation network. According to DOT, volumes  of goods shipped by trucks and railroads are projected to increase by 98  percent and 88 percent, respectively, by 2035 over 2002 levels, at the same  time that the ability to increase capacity will be constrained by geographic  barriers, population density, and urban land-use development patterns.  One study estimates that highway congestion alone costs shippers $10  billion annually. Constraints on freight mobility can also result in  undesirable environmental effects, such as air pollution, and contribute to  increased risks for illnesses, such as respiratory disease.
Flight delays and cancellations at congested airports also continue to  plague the U.S. aviation system. Flight delays and cancellations steadily  increased from 2002 through 2007 and decreased slightly in 2008. (See fig.  5.) For example, almost one in four flights either arrived late or was  canceled in 2008, and the average flight delay increased despite a 6 percent  decline in the total number of operations through December 2008. Delays  are a particular problem at a few airports, such as those in the New York  area, where less than 70 percent of flights arrive on time. Because the  entire airspace system is highly interdependent, delays at one airport may  lead to delays rippling across the system and throughout the day.
Commissions, proposals, and actions have attempted to address mobility  issues in past years. To address concerns with the performance of the  surface transportation system, including mobility concerns, Congress  established two commissions to examine current and future needs of the  system and recommend needed changes to surface transportation  programs, one of which called for significantly increasing the level of  investment in surface transportation. Various other transportation industry  associations and research organizations have also issued proposals for  restructuring surface transportation programs. DOT has also taken several  steps in the last 5 years to address key impediments to freight mobility by  developing policies and programs to address congestion in the United  States. For example, it has drafted a framework for a national freight  policy, released a national strategy to reduce congestion, and created a  freight analysis framework to forecast freight flows along national  corridors and through gateways. DOT and FAA began implementing  several actions in summer 2008 intended to enhance capacity and reduce  flight delays, particularly in the New York region. These actions include  redesigning the airspace around the New York, New Jersey, and  Philadelphia metropolitan area and establishing schedule caps on takeoffs  and landings at the three major New York airports. In addition, as part of  a broad congestion relief initiative, DOT awarded over $800 million to  several cities under its Urban Partnership Agreements initiative to  demonstrate the feasibility and benefits of comprehensive, integrated,  performance-driven, and innovative approaches to relieving congestion.
We have previously reported on several challenges that impede DOT’s  efforts to improve mobility:    Although all levels of government have significantly invested in  transportation, and recommendations have been made by transportation  stakeholders for increasing investment in surface transportation even  further, we have previously reported that federal transportation funding is  generally not linked to specific performance-related goals or outcomes,  resulting in limited assurance that federal funding is being channeled to  the nation’s most critical mobility needs. Federal funding is also often tied  to a single transportation mode, which may limit the use of those funds to  finance the greatest improvements in mobility.
DOT does not possess adequate data to assess outcomes or implement  performance measures. For example, DOT lacks a central source for data  on congestion—even though it has identified congestion as a top  priority—and available data are stovepiped by mode, impeding efficient  planning and project selection.
Although DOT and FAA should be commended for taking steps to reduce  mounting flight delays and cancellations, as we predicted this past  summer, delays and cancellations in 2008 did not markedly improve over  2007 levels despite a decline in passenger traffic. The growing air traffic  congestion and delay problem that we face is the result of many factors,  including airline practices and inadequate investment in airport and air  traffic control infrastructure. Long-term investments in airport  infrastructure and air traffic control, or other actions by Congress, DOT, or  FAA could address the fundamental imbalance between underlying  demand for, and supply of, airspace capacity.
section_title: Modernizing the Air Traffic Control System and Ensuring a Safe and Efficient Transformation to the Next Generation Air Transportation System
paragraphs: FAA has made significant progress in addressing weaknesses in its air  traffic control modernization. It established a framework for improving  system management capabilities, continued to develop an enterprise  architecture, implemented a comprehensive investment management  process, assessed its human capital challenges, and developed an updated  corrective action plan for 2009 to sustain improvement efforts and  enhance its ability to address risks, among other things. Because FAA has  shown progress in addressing most of the root causes of past problems  with the air traffic control modernization effort and is committed to  sustaining progress into the future, we removed this area from the high- risk list in January 2009. Nonetheless, we will closely monitor FAA’s  efforts because the modernization program is still technically complex and  costly, and FAA needs to place a high priority on efficient and effective  management.
FAA’s improvement efforts are even more critical because the  modernization has been extended to plan for the Next Generation Air  Transportation System (NextGen)—a complex and ambitious multiagency  undertaking that is intended to transform the current radar-based system  to an aircraft-centered, satellite-based system by 2025. As the primary  implementer of NextGen, FAA faces several challenges that, if not  addressed, could severely compromise NextGen goals and potentially lead  to a future gap between the demand for air transportation and available  capacity that could cost the U.S. economy billions of dollars annually.  Challenges facing FAA include the following:    Accelerating the implementation of available NextGen technologies,  which, according to some industry stakeholders, are not being  implemented fast enough to have NextGen in place by 2025.
Working with stakeholders to explore a range of potential options that  would provide incentives to aircraft operators to purchase NextGen  equipment and to suppliers to develop that equipment. These options  could include some combination of mandated deadlines, operational  credits, or equipment investment credits.
Reconfiguring facilities and enhancing runways to take full advantage of  NextGen’s benefits. FAA has not developed a comprehensive  reconfiguration plan, but intends to report on the cost implications of  reconfiguration this year.
Sustaining the current air traffic control system and maintaining facilities  during the transition to NextGen. More and longer unscheduled outages of  existing equipment and support systems indicate more frequent system  failures. These systems will be the core of the national airspace system for  a number of years and, in some cases, become part of NextGen.
To implement NextGen, the department is undertaking several initiatives.  For example, FAA has formed partnerships with industry to accelerate the  availability of NextGen capabilities. These partnerships include (1)  entering into agreements with private sector firms to conduct NextGen  technology demonstration projects; (2) working with industry and the  local community on their plans to build an aviation research and  technology park where FAA can work with industry on the research and  development, integration, and testing of NextGen technologies; and (3)  establishing a NextGen midterm task force to forge a consensus on  operational improvements and planned benefits for 2013 to 2018. In  addition, to increase the capacity of existing runways at busy airports,  FAA has begun implementing the High-Density Terminal and Airport  Operations initiative that changes requirements for aircraft separation and  spacing, among other things.
One step for moving forward with the NextGen transition was proposed in  the 2009 House reauthorization bill, which directed FAA to establish a  working group to develop criteria and make recommendations for the  realignment of services and facilities—considering safety, potential cost  savings, and other criteria, in concert with stakeholders, including  employee groups. Until FAA establishes this working group and the group  develops recommendations, the configurations needed for NextGen  cannot be implemented and potential savings that could help offset the  cost of NextGen will not be realized.
Mr. Chairman, this concludes my prepared statement. I would be pleased  to respond to any questions that you or other Members of the  Subcommittee might have.
section_title: GAO Contact and Staff Acknowledgments
paragraphs: For further information on this statement, please contact Katherine  Siggerud at (202) 512-2834 or siggerudk@gao.gov. Contact points for our  Congressional Relations and Public Affairs offices may be found on the  last page of this statement. Individuals making key contributions to this  testimony were Sara Vermillion, Assistant Director; Steve Cohen, Matthew  Cook, Heather Krause, Nancy Lueke, James Ratzenberger, and Teresa  Spisak.
section_title: Related GAO Products
paragraphs: National Airspace System: FAA Reauthorization Issues Are Critical to  System Transformation and Operations. GAO-09-377T. Washington, D.C.:  February 11, 2009.
High-Risk Series: An Update. GAO-09-271. Washington, D.C.: January  2009.
FAA Airspace Redesign: An Analysis of the New York/New  Jersey/Philadelphia Project. GAO-08-786. Washington, D.C.: July 31, 2008.
Surface Transportation Programs: Proposals Highlight Key Issues and  Challenges in Restructuring the Programs. GAO-08-843R. Washington,  D.C.: July 29, 2008.
Traffic Safety Programs: Progress, States’ Challenges, and Issues for  Reauthorization. GAO-08-990T. Washington, D.C.: July 16, 2008.
Physical Infrastructure: Challenges and Investment Options for the  Nation’s Infrastructure. GAO-08-763T. Washington, D.C.: May 8, 2008.
Surface Transportation: Restructured Federal Approach Needed for More  Focused, Performance-Based, and Sustainable Programs. GAO-08-400.  Washington, D.C.: March 6, 2008.
Federal Aviation Administration: Challenges Facing the Agency in  Fiscal Year 2009 and Beyond. GAO-08-460T. Washington, D.C.: February  7, 2008.
Federal-Aid Highways: Increased Reliance on Contractors Can Pose  Oversight Challenges for Federal and State Officials. GAO-08-198.  Washington, D.C.: January 8, 2008.
Freight Transportation: National Policy and Strategies Can Help  Improve Freight Mobility. GAO-08-287. Washington, D.C.: January 7, 2008.
Highlights of a Forum: Transforming Transportation Policy for the 21st  Century. GAO-07-1210SP. Washington, D.C.: September 19, 2007.
Surface Transportation: Strategies Are Available for Making Existing  Road Infrastructure Perform Better. GAO-07-920. Washington, D.C.:   July 26, 2007.
Performance and Accountability: Transportation Challenges Facing  Congress and the Department of Transportation. GAO-07-545T.  Washington, D.C.: March 6, 2007.
Highway Trust Fund: Overview of Highway Trust Fund  Estimates. GAO-06-572T. Washington, D.C.: April 4, 2006.
Highlights of an Expert Panel: The Benefits and Costs of Highway and  Transit Investments. GAO-05-423SP. Washington, D.C.: May 6, 2005.
Federal-Aid Highways: FHWA Needs a Comprehensive Approach to  Improving Project Oversight. GAO-05-173. Washington, D.C.: January 31,  2005.
Federal-Aid Highways: Trends, Effect on State Spending, and Options  for Future Program Design. GAO-04-802. Washington, D.C.: August 31,  2004.
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