More than 10 years ago, Congress directed FAA to conceptualize and plan NextGen; FAA is now implementing key NextGen systems and capabilities. NextGen was envisioned as a major redesign of the air transportation system to increase efficiency, enhance safety, and reduce flight delays that would entail precision satellite navigation and surveillance; digital, networked communications; an integrated weather system; and more. Figure 1 provides examples of changes and benefits that are expected to come from NextGen. The transition to NextGen—which encompasses multiple programs, procedures, and systems at different levels of maturity—is a complex, incremental, multi-year process. Since 2006, we have monitored FAA’s development of NextGen and identified a number of key challenges facing the agency’s implementation efforts. The 2012 Act included several provisions that address some of the issues that we have identified in our work, including incentivizing aircraft operators to equip with NextGen technologies, developing performance measures, and involving stakeholders in NextGen development.progress in implementing NextGen has highlighted ongoing challenges in Our recent work on FAA’s three areas: improving leadership, demonstrating near-term benefits, and balancing the needs of the current system while implementing NextGen systems. Our work has found that complex organizational transformations, such as NextGen, involving technology, systems, and retraining key personnel require substantial leadership commitment over a sustained period, and that leaders must be empowered to make critical decisions and held accountable for results. Transitions, inconsistent leadership, and unclear roles and responsibilities can weaken the effectiveness of the internal and external collaboration required for successful implementation. Both the magnitude of the multi-year transition, as well as the numerous efforts under way throughout the different offices and divisions in FAA to effectuate that transition, will require FAA’s leaders to manage all aspects of NextGen in a strategic, timely, and coordinated fashion. FAA has struggled to have the leadership in place to manage and oversee NextGen implementation, but more recently, has begun to fill key positions. In June 2013, FAA appointed a new Deputy Administrator and designated a Chief NextGen Officer, in response to Section 204 of the 2012 Act. In addition, in September 2013, FAA appointed a new Assistant Administrator for NextGen—a position that had previously been vacant. Designating one leader—such as the Deputy Administrator’s responsibility over NextGen—can be beneficial because it centralizes accountability and can speed decision-making. With these positions now filled, FAA should be in a better position to resolve its NextGen leadership challenges. However, as I have stated in other work, a number of offices oversee certain aspects of NextGen, not all of which report to the Assistant Administrator, and implementation will require successful collaboration between these offices. As these positions have only recently been filled, it is not yet clear how effective the changes resulting from the 2012 Act will be in achieving that collaboration. Another key development in NextGen management envisioned by Section 208 of the 2012 Act redesignated the Director of the Joint Planning and Development Office (JPDO) as an Associate Administrator reporting directly to the FAA Administrator and defined that administrator’s responsibility for coordination and planning with FAA’s partner agencies. This change has not been fully implemented by FAA. However, in the Consolidated Appropriations Act of 2014, Congress eliminated direct funding of JPDO, and subsumed JPDO in FAA’s operations budget. At this point, it remains unclear whether a JPDO Director position will continue and, if not, how the roles and responsibilities of that office, particularly with respect to long-term planning and coordination of research and development efforts across partner agencies, will be redistributed within FAA. We will continue to monitor these issues in two studies requested by this committee—one examining the organizational and leadership structure of the NextGen effort, and one looking more in-depth at actions FAA has taken to streamline its organization. We have begun both of these examinations. To convince operators to make investments in NextGen equipment, FAA must continue to deliver systems, procedures, and capabilities that demonstrate near-term benefits and a return on an operator’s investments. In particular, a large percentage of the current U.S. air carrier fleet is equipped to fly more precise performance-based navigation (PBN) procedures, such as following precise routes that use the Global Positioning System or glide descent paths, which can save airlines and other aircraft operators money through reduced fuel burn and flight time. However, aircraft operators have expressed concerns that FAA has been slow to produce new procedures for various reasons, and has not produced the most useful or beneficial PBN routes and procedures. The 2012 Act included a number of provisions aimed at accelerating the creation of PBN procedures. For example, Section 213 of the 2012 Act directed FAA to develop plans to identify beneficial PBN procedures and to prioritize their implementation at key airports. We reported in April of 2013 that FAA had made progress in focusing its PBN efforts at seven priority metroplexes with airport operations that have a large effect on the overall efficiency of the NAS. More recently, FAA reports that it is considering recommendations from the NextGen Advisory Committee (NAC) regarding revalidation of the criteria used to prioritize these metroplexes, and that recent efforts have been diverted to metroplexes where the deployment of the new En Route Automation Management (ERAM) system is complete, in order not to interfere with ERAM deployment at those locations where it is ongoing. Our work also found that FAA does not have a system for tracking the use of existing PBN procedures. As a result, FAA is unable to assure that investment in these routes is worthwhile or that they justify the cost to develop and maintain them. Further, in the absence of data on the use of existing PBN routes, airlines and other stakeholders remain unconvinced that the investments needed for the full implementation of NextGen will be justified. Such data could help the agency demonstrate the value of PBN technologies and any resulting benefits, as well as allow the agency to identify routes that need to be revised to increase their use. We made recommendations to FAA to develop a system to track the use of PBN procedures and a process to proactively identify new PBN procedures based on NextGen goals and targets. We will continue to monitor FAA’s progress in implementing these recommendations. The 2012 Act also included two other key provisions to accelerate the creation of PBN procedures. The first was a categorical exclusion from environmental review for PBN procedures that if implemented could demonstrate measurable reductions in fuel consumption, carbon dioxide emissions, and noise, on a per-flight basis, as compared to aircraft operations that follow existing procedures. However, our April 2013 report found that, according to FAA, potential noise impacts are measured cumulatively for all flights and that FAA has not yet identified an approach for per-flight assessments. FAA officials stated that no currently available methodology resolves the technical problems involved in making such a determination, so the agency has not applied this new categorical exclusion. Second, the 2012 Act called for the agency to establish a program for qualified third parties to develop, test, and maintain flight procedures. FAA has made some progress in this area by awarding a $2.8-million contract to GE’s Naverus and a partner to develop two PBN procedures each at five mid-sized airports. The contractors are to design, evaluate, and maintain these procedures and be responsible for providing environmental data and analysis to FAA to support categorical exclusions and for drafting any required National Environmental Policy Act reviews, for review and approval by FAA. As of January 2014, PBN procedures had been implemented at two of the five selected airports. NextGen represents a transition from existing ATC systems and facilities to new systems, potentially necessitating changes to or consolidation of existing facilities. We have reported over the years that various investment and policy decisions, including what existing ATC systems and facilities will remain in the NAS during the transition and for how long, have yet to be made. For the systems and facilities that remain, FAA will have to monitor and maintain their performance and condition while the agency implements the NextGen transition. Decisions about the number of existing systems and facilities that will remain in operation during the transition have implications for FAA’s capital and operations budgets going forward. If aging systems and associated facilities are not retired, FAA will miss potential opportunities to reduce its overall maintenance costs at a time when resources needed to maintain both systems and facilities may become scarcer. The 2012 Act contained a number of provisions aimed at accelerating the implementation of NextGen systems. However, we found in August 2013 that FAA’s budget planning does not fully account for the potential impact of NextGen systems that will be deployed and the need for continued operations and maintenance of existing systems and facilities. In the 2012 Act, Congress also expressed concern regarding the condition of FAA facilities and mandated that we study their condition. In our September 2013 report, we noted that FAA estimates its staffed facilities like towers and Terminal Radar Approach Control (TRACON) facilities have about $260 million in deferred maintenance; unstaffed facilities, such as shelters and communication towers that house and support NAS equipment, had an estimated $446 million in deferred maintenance in 2012. These, and other cost estimates for maintaining existing systems and facilities, along with implementing NextGen exceed anticipated funding levels. However, we concluded that FAA’s imprecise facility-condition data do not facilitate agency-wide priority assessments, which, in turn, could hinder the agency’s ability to target its limited resources on those projects in greatest need of repair and that are most critical to the NAS. In addition, section 804 of the 2012 Act directed FAA to complete a study on the consolidation and realignment of FAA services and facilities to support the transition to NextGen. However, FAA has yet to identify which facilities would be consolidated or realigned, and according to FAA officials, the study will continue through 2014. In our August 2013 report we recommended improvements to FAA’s budget-planning and infrastructure-condition data, improvements that FAA is currently considering.