National Airspace System:

Status of Wide Area Augmentation System Project

RCED-98-79: Published: Apr 30, 1998. Publicly Released: Apr 30, 1998.

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Pursuant to a legislative requirement, GAO reviewed the status of the Federal Aviation Administration's (FAA) Wide Area Augmentation System (WAAS) project, focusing on: (1) whether the Secretary of Transportation's report provides a complete assessment of FAA's risks in developing the WAAS project; and (2) how alternative assumptions would affect WAAS' benefit-cost analysis of January 1998.

GAO noted that: (1) the Secretary's report provided a complete assessment of FAA's risks in achieving the WAAS project's performance and cost goals but not its scheduled goals; (2) in terms of system performance, the Secretary's report recognized that WAAS' vulnerability to intentional or unintentional interference from electronic equipment must be addressed; (3) in January 1998, FAA estimated that it would save about $500 million (in net present value) over the WAAS project's life cycle by fully phasing out its network of ground-based navigation aids; (4) if FAA retains some portion of this network, these benefits would decrease; (5) FAA also estimated that aircraft operators could save $350 million by removing ground-based navigation equipment from their aircraft; (6) these benefits would be reduced to the extent that operators must continue to keep such equipment on board; (7) by identifying a range of cost estimates and associated probabilities, the Secretary's report addressed GAO's past concern that FAA's firm, discrete-point cost estimates implied a level of precision that could not be supported; (8) GAO agreed with the Secretary's report that the greatest degree of uncertainty about the WAAS cost estimates relates to the costs of the geostationary communications satellites; (9) the uncertainty exists because FAA does not know exactly how many satellites will be needed and how much the per-unit costs will be; (10) the Secretary's report fell short of providing a complete assessment of the uncertainties FAA faces in achieving WAAS' schedule goals; (11) the report also did not discuss the risks to the overall schedule if FAA does not award the contract to lease the satellites by July 1998 as planned; (12) in January 1998, FAA's analysis found that the benefits to aviation from WAAS would be three times as great as its costs; (13) GAO requested that FAA recalculate its benefit-cost analysis to determine the impact of three alternative assumptions; (14) using these cost and decommissioning assumptions did not cause much of a decrease in the benefit-cost ratio or the net benefits; (15) however, the exclusion of small increments of passenger time savings had a much more significant impact; and (16) when these alternative assumptions were taken together, GAO found that the net present value of the project's net benefits decreased by more than $1 billion but were still about twice as great as the costs.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: The agency completed an alternatives analysis in September 1999 to determine what the future air navigation system would look like. This analysis presents a range of alternatives and discusses the risks associated with implementing FAA's preferred WAAS approach. As a result of this analysis, which will be provided to Congress, decisionmakers will be better able to understand the milestones for achieving system improvements.

    Recommendation: To assist Congress in making future funding decisions for the Wide Area Augmentation System project, the Secretary of Transportation should direct the Administrator, FAA, to report information to Congress on the range of milestones for making the initial and full WAAS operational and the probabilities associated with those milestones.

    Agency Affected: Department of Transportation

  2. Status: Closed - Implemented

    Comments: FAA has considered several options for acquiring additional geostationary satellites. Furthermore, FAA has completed a lease vs. buy analysis to support its strategy for leasing geostationary satellites. This lease vs. buy analysis is being provided to Congress.

    Recommendation: To assist Congress in making future funding decisions for the Wide Area Augmentation System project, the Secretary of Transportation should direct the Administrator, FAA, to report information to Congress on a detailed explanation of the agency's strategy for leasing geostationary satellites.

    Agency Affected: Department of Transportation

  3. Status: Closed - Implemented

    Comments: FAA's alternatives analysis completed in September 1999, included an updated benefit-cost analysis of WAAS along with benefit-cost analyses of alternative investments. It also highlighted how effects of including small increments of passenger time savings impact the value of the WAAS investment.

    Recommendation: To assist Congress in making future funding decisions for the Wide Area Augmentation System project, the Secretary of Transportation should direct the Administrator, FAA to report information to Congress on updated benefit-cost analyses, including a comparison with alternative investments of FAA's resources and an explanation of the effects of including small increments of passenger time savings.

    Agency Affected: Department of Transportation

 

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