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United States Government Accountability Office: 
GAO: 

Report to Congressional Requesters: 

July 2013: 

Aviation: 

Status of DOT's Actions to Address the Future of Aviation Advisory 
Committee's Recommendations: 

GAO-13-657: 

GAO Highlights: 

Highlights of GAO-13-657, a report to congressional requesters. 

Why GAO Did This Study: 

The aviation industry is important to the U.S. economy and is a 
critical link in the nation’s transportation infrastructure. However, 
the industry has faced challenges, such as an outdated national air-
traffic management system and an increasingly competitive global 
market. In 2010, in response to these and other challenges, DOT 
established the FAAC to develop a manageable, actionable list of 
recommendations for DOT. In April 2011, the FAAC released a report 
outlining 23 recommendations in five areas: environment, financing, 
competitiveness and viability, labor and workforce, and safety. 

GAO was asked to review the status of DOT’s efforts to implement the 
FAAC recommendations. GAO examined 10 of the FAAC’s 23 recommendations 
to determine (1) DOT’s progress in addressing the selected 
recommendations, and any planned future actions; (2) the FAAC members’ 
perspective on the extent to which DOT’s actions address these 
recommendations; and (3) the challenges, if any, that DOT faces in 
addressing the recommendations. The 10 selected recommendations 
covered each of the 5 areas and allowed GAO to leverage ongoing or 
recent GAO work. GAO did not analyze the validity of the FAAC’s 
recommendations, and our work does not take a position on, or 
represent an endorsement of, the recommendations. GAO reviewed agency 
documents and literature, and interviewed FAAC members and DOT and FAA 
officials. DOT provided technical comments, which were incorporated as 
appropriate. 

What GAO Found: 

Future of Aviation Advisory Committee (FAAC) recommendations, DOT and 
the Federal Aviation Administration (FAA) have taken actions on the 10 
FAAC recommendations that GAO reviewed (see table). DOT and FAA 
officials noted that they continue to work on three recommendations as 
part of long-term efforts and have ongoing work related to some of the 
seven recommendations that they believe are addressed. 

FAAC members recognized DOT’s actions to address the recommendations. 
However, a majority of the FAAC subcommittee members believe that more 
work remains to fully address 9 of the 10 recommendations (see table). 
FAAC members stated that some recommendations may not be fully 
addressed because they are linked to ongoing efforts that DOT also 
identified. 

DOT, FAA officials, and FAAC members most frequently identified 
resource constraints and the need to collaborate with multiple 
stakeholders as implementation challenges and in some cases, noted 
efforts to address these challenges. DOT officials noted that fully 
addressing some recommendations may depend on factors outside of DOT’s 
control, such as extending the alternative minimum tax exemption, 
which would require legislation, and developing sustainable 
alternative fuels, which is a long-term, multi-agency effort. 

Table: Status of FAAC Recommendations Selected for GAO Review: 

Environment: 

Area and selected FAAC recommendations: Exercise strong national 
leadership to promote U.S. aviation as a first user of sustainable 
alternative fuels; 
Status per DOT/FAA officials: In progress; 
Status per majority of FAAC members: In progress. 

Area and selected FAAC recommendations: Establish a harmonized 
approach for aviation carbon dioxide emission reductions; 
Status per DOT/FAA officials: In progress; 
Status per majority of FAAC members: In progress. 

Financing: 

Area and selected FAAC recommendations: Support extending the 
alternative minimum tax (AMT) exemption for airport private activity 
bonds; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: In progress. 

Area and selected FAAC recommendations: Fund accelerated Next 
Generation Air Transportation System equipage of aircraft; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: In progress. 

Area and selected FAAC recommendations: Review eligibility criteria 
for the Airport Improvement Program and Passenger Facility Charge 
Program; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: In progress. 

Competitiveness and viability: 

Area and selected FAAC recommendations: Promote the global 
competitiveness of the U.S. aviation industry; 
Status per DOT/FAA officials: In progress; 
Status per majority of FAAC members: In progress. 

Labor and workforce: 

Area and selected FAAC recommendations: Ensure coordination and focus 
on science, technology, engineering, and math (STEM) education 
programs; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: Addressed. 

Safety: 

Area and selected FAAC recommendations: Seek legal protections for 
safety data; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: In progress. 

Area and selected FAAC recommendations: Support predictive analytic 
capabilities for safety data; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: In progress. 

Area and selected FAAC recommendations: Review and reprioritize FAA's 
rulemaking initiatives; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: In progress. 

Source: GAO analysis of DOT/FAA and FAAC member interviews. 

[End of table] 

View [hyperlink, http://www.gao.gov/products/GAO-13-657]. For more 
information, contact Gerald L. Dillingham, Ph.D., at (202) 512-2834 or 
dillinghamg@gao.gov. 

[End of section] 

Contents: 

Letter: 

Background: 

DOT and FAA Officials Believe That Seven of the Selected 
Recommendations Are Addressed and That Three Are In Progress: 

FAAC Members Acknowledge DOT's Actions but Believe That More Work 
Remains in Responding to the Selected Recommendations: 

Resource Constraints and Stakeholder Collaboration Were Most 
Frequently Cited as Implementation Challenges for the Selected 
Recommendations: 

Agency Comments: 

Section 1: Selected FAAC Recommendations and DOT's and FAA's Actions 
to Address Them: 

1. FAAC Recommendation--Sustainable Alternative Fuels: 

2. FAAC Recommendation--Harmonized Approach to CO2 Reduction: 

3. FAAC Recommendation--Support Extending the Alternative Minimum Tax 
Exemption: 

4. FAAC Recommendation--Funding Accelerated NextGen Equipage of 
Aircraft: 

5. FAAC Recommendation--Review Criteria for the Airport Improvement 
Program and Passenger Facility Charge Program Related to NextGen: 

6. FAAC Recommendation--Promote Global Competitiveness: 

7. FAAC Recommendation--STEM Education: 

8. FAAC Recommendation--Legal Protections for Safety Data: 

9. FAAC Recommendation--Predictive Analytic Capabilities for Safety 
Data and Information: 

10. FAAC Recommendation--Prioritize Rulemaking: 

Appendix I: Listing of the 23 Recommendations Made by the Future of 
Aviation Advisory Committee, by Area: 

Appendix II: Future of Aviation Advisory Committee Members: 

Appendix III: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: FAAC Recommendations Selected for GAO Review: 

Table 2: Status of FAAC Recommendations Selected for GAO Review: 

Table 3: FAAC Recommendations Selected for GAO Review and Location in 
Report: 

Table 4: FAAC Recommendation on Sustainable Alternative Fuels and 
DOT's and FAA's Actions to Address It, as of June 2013: 

Table 5: FAAC Recommendation on Establishing a Harmonized Framework 
for Aviation CO2 Reductions and DOT's and FAA's Actions to Address It, 
as of June 2013: 

Table 6: FAAC Recommendation on Extending the AMT Exemption for 
Private Activity Bonds and DOT's and FAA's Actions to Address It, as 
of June 2013: 

Table 7: FAAC Recommendation on Accelerating NextGen Equipage and 
DOT's and FAA's Actions to Address It, as of June 2013: 

Table 8: FAAC Recommendation on Airport Improvement Program (AIP) and 
Passenger Facility Charge (PFC) Eligibility for NextGen Projects and 
DOT's and FAA's Actions to Address It, as of June 2013: 

Table 9: FAAC Recommendation on Promoting Global Competitiveness and 
DOT's and FAA's Actions to Address It, as of June 2013: 

Table 10: FAAC Recommendation on STEM Outreach and DOT's and FAA's 
Actions to Address It, as of June 2013: 

Table 11: FAAC Recommendation on Safety Data Protections and DOT's and 
FAA's Actions to Address It, as of June 2013: 

Table 12: FAAC Recommendation on Predictive Analytic Capabilities for 
Safety Data and Information and DOT's and FAA's Actions to Address It, 
as of June 2013: 

Table 13: FAAC Recommendation on Rulemaking Priorities and DOT's and 
FAA's Actions to Address It, as of June 2013: 

Table 14: Non-Government FAAC Members: 

Abbreviations: 

ADS-B: Automatic Dependent Surveillance-Broadcast: 

ACE: Aviation Career Education: 

AIP: Airport Improvement Program: 

AMT: alternative minimum tax: 

ARAC: Aviation Rulemaking Advisory Committee: 

ASAP: Aviation Safety Action Program: 

ASIAS: Aviation Safety Information Analysis and Sharing: 

ATOS: Air Transportation Oversight System: 

AVSED: Aviation and Space Education: 

CAAFI: Commercial Aviation Alternative Fuels Initiative: 

CLEEN: Continuous Lower Energy, Emissions, and Noise: 

CoSTEM: Committee on Science, Technology, Engineering, and Math 
Education: 

CO2: carbon dioxide: 

Data Comm: Data Communications: 

DOD: Department of Defense: 

DOE: Department of Energy: 

DOT: Department of Transportation: 

EPA: Environmental Protection Agency: 

ETS: Emissions Trading Scheme: 

EU: European Union: 

FAA: Federal Aviation Administration: 

FAAC: Future of Aviation Advisory Committee: 

FACA: Federal Advisory Committee Act: 

FOQA: Flight Operational Quality Assurance: 

HEFA: Hydroprocessed Esters and Fatty Acids: 

ICAO: International Civil Aviation Organization: 

NAC: NextGen Advisory Committee: 

NC3: National Coalition of Certification Centers: 

NextGen: Next Generation Air Transportation System: 

NSTC: National Science and Technology Council: 

NTSB: National Transportation Safety Board: 

OSTP: Office of Science and Technology Policy: 

PBN: Performance-Based Navigation: 

PFC: Passenger Facility Charge: 

PREP: Pre-Rulemaking Evaluation and Prioritization: 

RAISE: Recognizing Aviation and Aerospace Innovation in Science and 
Engineering: 

RFS2: Renewable Fuel Standard: 

RITA: Research and Innovative Technology Administration: 

RPWG: Rulemaking Prioritization Working Group: 

STEM: science, technology, engineering, and math: 

SMS: safety management system: 

USDA: United States Department of Agriculture: 

WAM: Wide Area Multilateration: 

[End of section] 

GAO:
United States Government Accountability Office: 
441 G St. N.W. 
Washington, DC 20548: 

July 25, 2013: 

Congressional Requesters: 

Over the past decade, the aviation industry has faced fluctuating oil 
prices, an economic recession, and safety concerns following the crash 
of a Colgan Air flight in Buffalo, New York, as well as ongoing 
changes in the industry related to air-traffic control modernization, 
increased global competition, and an aging workforce. On November 12, 
2009, the Secretary of the Department of Transportation (DOT) convened 
an Aviation Summit to gather industry and expert opinion on actions 
that would promote future success of the aviation industry. The 
discussion centered on five areas: environment, financing, 
competitiveness and viability, labor and workforce, and safety. With 
these areas in mind, Secretary Ray LaHood chartered the Future of 
Aviation Advisory Committee (FAAC) on April 16, 2010, to develop a 
manageable, actionable list of recommendations in each of these five 
areas for DOT. The FAAC included 19 members--1 government official and 
18 non-government representatives--from a cross-section of 
stakeholders, such as air carriers, airports, airline labor unions, 
manufacturers, and representatives from the finance community, 
academia, and passenger interests. On April 11, 2011, the FAAC issued 
a final report listing 23 recommendations that the FAAC identified as 
critical to the future of the U.S. aviation industry. 

You asked us to review the status of DOT's efforts to implement the 
FAAC recommendations. We examined 10 of the FAAC's 23 recommendations 
to determine (1) DOT's progress in addressing the selected 
recommendations and any further planned actions; (2) the FAAC members' 
perspectives on the extent to which DOT's actions address these 
recommendations; and (3) the challenges, if any, that DOT faces in 
addressing the recommendations. The 10 selected recommendations cover 
each of the 5 areas reviewed by the FAAC and allowed us to leverage 
ongoing or recently completed GAO work. Given that the 10 
recommendations are directed toward specific, discrete actions, our 
statements regarding DOT's progress in addressing the recommendations 
are specific to each recommendation and cannot be generalized to 
assess DOT's overall progress across all 23 FAAC 
recommendations.[Footnote 1] We did not analyze the validity of the 
commission's recommendations, and our work does not take a position 
on, or represent an endorsement of, the recommendations. See table 1 
for a list of the recommendations we reviewed. 

Table 1: FAAC Recommendations Selected for GAO Review: 

Area: Environment; 
FAAC recommendations: 
* Exercise strong national leadership to promote and showcase U.S. 
aviation as a first user of sustainable alternative fuels; 
* Establish a harmonized approach for aviation carbon dioxide emission 
reductions. 

Area: Financing; 
FAAC recommendations: 
* Support extending the alternative minimum tax exemption for airport 
private activity bonds; 
* Fund accelerated Next Generation Air Transportation System (NextGen); 
* [A] equipage of aircraft; 
* Review eligibility criteria for the Airport Improvement Program and 
Passenger Facility Charge Program. 

Area: Competitiveness and viability; 
FAAC recommendations: 
* Promote the global competitiveness of the U.S. aviation industry. 

Area: Labor and workforce; 
FAAC recommendations: 
* Ensure coordination and focus on science, technology, engineering, 
and math (STEM) education programs. 

Area: Safety; 
FAAC recommendations: 
* Seek legal protections for safety data program participants; 
* Support predictive analytic capabilities for safety data and 
information[B]; 
* Review and reprioritize FAA's rulemaking initiatives. 

Source: FAAC report. 

[A] The Federal Aviation Administration (FAA), in collaboration with 
other federal agencies and the aviation industry, is transforming the 
nation's ground-based air-traffic control system to an air-traffic 
management system using satellite-based navigation and other 
technology. This transformation is referred to as the Next Generation 
Air Transportation System (NextGen). 

[B] This recommendation is related to FAA's efforts to shift toward a 
proactive, data-driven safety oversight approach, commonly referred to 
as a safety management system (SMS) approach. 

[End of table] 

To determine DOT's progress and challenges in addressing the selected 
recommendations, we reviewed relevant GAO and DOT Office of Inspector 
General reports, agency documents, including plans for addressing the 
recommendations, DOT and Federal Aviation Administration (FAA) 
documentation of actions taken, and DOT's website for tracking 
progress on the committee's recommendations. We also reviewed 
legislation to determine the extent to which it affected or addressed 
the recommendations. In addition, we interviewed DOT and FAA officials 
about the steps they have taken to address the recommendations and any 
challenges they have faced in implementing the recommendations. We 
also interviewed 17 of the 18 FAAC non-government members to obtain 
their perspectives on the extent to which DOT's actions addressed the 
recommendations from the subcommittees on which they served, any 
challenges DOT faces in addressing the recommendations, and what, if 
any, additional actions DOT should take to address the 
recommendations.[Footnote 2] Although DOT is not required to implement 
any of the FAAC's recommendations, we solicited the committee members' 
perspective on whether DOT should continue monitoring and reporting on 
its progress in addressing the recommendations. A list of the FAAC 
members we interviewed is available in appendix II. 

We conducted this performance audit from November 2012 through July 
2013 in accordance with generally accepted government auditing 
standards. Those standards require that we plan and perform the audit 
to obtain sufficient, appropriate evidence to provide a reasonable 
basis for our findings and conclusions based on our audit objectives. 
We believe that the evidence obtained provides a reasonable basis for 
our findings and conclusions based on our audit objectives. 

Background: 

The U.S. aerospace industry contributes to the nation's economic 
health and national security. The industry's wide-ranging activities--
including aircraft manufacturing and commercial aviation--make it a 
major contributor to U.S. economic growth. DOT and the FAA (an 
administration of DOT) each play a policy and regulatory role in 
aviation, with DOT involved in consumer and economic issues, such as 
licensing airlines and reviewing applications for antitrust immunity 
between airlines, and FAA's overseeing the safety of civil aviation. 
To inform these efforts, various administrations and Congresses have 
periodically established committees or commissions comprised of 
external stakeholders to provide recommendations for DOT and FAA, as 
well as other agencies involved in aviation, to consider in their 
implementation of aviation policy. For example, in 1996, President 
Clinton established the White House Commission on Aviation Safety and 
Security, which provided 57 recommendations in the areas of safety, 
air traffic control, security, and accident response. In 2001, 
Congress established the Commission on the Future of the United States 
Aerospace Industry to study issues associated with the future of this 
industry in the global economy, and to recommend potential actions by 
the federal government to support the maintenance of a robust 
aerospace industry in the 21st century.[Footnote 3] 

In contrast to these two efforts, the FAAC was established as a 
federal advisory committee, subject to the Federal Advisory Committee 
Act (FACA).[Footnote 4] Federal advisory committees exist throughout 
the executive branch of the federal government, providing input and 
advice to agencies in a variety of ways, such as preparing reports and 
developing recommendations. GAO has noted that advisory committees can 
be effective tools for agencies to gather input on topics of interest 
by informing agency leaders about issues of importance to the 
agencies' missions, consolidating input from multiple sources, and 
providing input at a relatively low cost.[Footnote 5] While an 
advisory group's input or recommendations may form the basis for a 
federal agency's decisions or policies, other factors may play a role 
in determining what action an agency ultimately takes. Because such 
groups are by design advisory, agencies are not required to implement 
their advice or recommendations. 

On April 16, 2010, Secretary Ray LaHood chartered the FAAC for a one-
year term and asked the DOT Assistant Secretary for Aviation and 
International Affairs to lead the effort. The FAAC was directed to 
provide information, advice, and recommendations to the Secretary on 
ensuring the competitiveness of the U.S. aviation industry and its 
capability to address the evolving transportation needs, challenges, 
and opportunities of the global economy. The FAAC was comprised of a 
cross-section of aviation stakeholders. During its first meeting, the 
Secretary asked the FAAC to develop consensus-based recommendations 
that could be acted upon immediately or in the near future, with 
tangible results.[Footnote 6] He also stated that the FAAC should 
remain cognizant of the tools that DOT and FAA could use to implement 
the recommendations, such as the federal rulemaking process, proposing 
legislation to Congress, and recommending compliance measures for 
industry. The FAAC established subcommittees to develop 
recommendations in the five areas specified in the FAAC charter: 
environment, financing, competitiveness and viability, labor and 
workforce, and safety. The subcommittees met multiple times over the 
course of 2010, and the full FAAC briefed the Secretary on its 23 
recommendations on December 15, 2010, with a final report outlining 
the recommendations and their underlying rationale released on April 
11, 2011. 

The Secretary publicly emphasized that the FAAC recommendations would 
not "sit on a shelf," and DOT established a process to implement the 
recommendations. DOT officials stated that the Office of Aviation and 
International Affairs has led DOT's work on addressing the FAAC 
recommendations and has provided periodic updates to FAAC members. 
Each recommendation was assigned to an "owner"--DOT or FAA staff--some 
of whom were already conducting work relevant to the recommendation. 
DOT officials also noted that some of the recommendations with 
multiple subactions have more than one owner. DOT staff collaborated 
with recommendation owners to create a "smart sheet" for addressing 
each FAAC recommendation. This document provided information on 
interim goals, or actions that must occur to reach the final goal; 
beneficiaries and allies of the recommendation; and potential 
challenges. The owners were not required to update these documents as 
time progressed. DOT officials stated that for about a year after the 
FAAC report was released, DOT's Office of Aviation and International 
Affairs had regular status meetings with the recommendation owners to 
ascertain their progress, and recommendation owners then reported 
progress periodically to DOT officials. DOT periodically updates a 
website on the status of the FAAC recommendations. During the course 
of our review, we noted that some of the recommendations had not been 
updated for over one year; however, DOT updated the status of all of 
the recommendations on its website in June 2013. 

DOT and FAA Officials Believe That Seven of the Selected 
Recommendations Are Addressed and That Three Are In Progress: 

DOT and FAA have taken actions on the 10 FAAC recommendations we 
reviewed. DOT and FAA officials noted that 3 of the 10 recommendations 
we reviewed--sustainable alternative fuels, global competitiveness, 
and a harmonized approach to carbon dioxide emission reductions--
continue to be addressed as part of long-term efforts. For example, 
DOT officials noted that addressing the global competitiveness 
recommendation is tied to long-term policy efforts with no timetable 
for conclusion, such as negotiating agreements with other countries to 
reduce the barriers for U.S. carriers interested in serving markets in 
those countries. While officials stated that DOT and FAA have 
addressed the other seven recommendations, they highlighted ongoing 
work on issues related to some of these recommendations. For example, 
FAA officials noted they have addressed the recommendation to 
accelerate investment and installation of NextGen equipment on 
aircraft because they are working to develop a program to provide 
financial incentives and operational benefits to operators that 
install NextGen equipment early.[Footnote 7] However, the officials 
added that they are still working to determine what the program will 
entail, including soliciting input from aircraft operators and 
potential private partners to determine how to establish an incentive 
program that operators want to participate in. They also noted that 
the appropriations requirements for a credit program have not yet been 
met. For additional details on actions DOT and FAA have taken on the 
recommendations, see section 1 of this report. 

FAAC Members Acknowledge DOT's Actions but Believe That More Work 
Remains in Responding to the Selected Recommendations: 

FAAC members acknowledged DOT and FAA efforts to address the 10 
recommendations selected for our work; however, a majority of the FAAC 
subcommittee members believe more work remains to fully address 9 of 
the 10 recommendations. See table 2 for a summary of the 
recommendations as well as their status according to DOT and the FAAC 
subcommittee members we interviewed. 

Table 2: Status of FAAC Recommendations Selected for GAO Review: 

Environment: 

Area and selected FAAC recommendations: Exercise strong national 
leadership to promote U.S. aviation as a first user of sustainable 
alternative fuels; 
Status per DOT/FAA officials: In progress; 
Status per majority of FAAC members: In progress. 

Area and selected FAAC recommendations: Establish a harmonized 
approach for aviation carbon dioxide emission reductions; 
Status per DOT/FAA officials: In progress; 
Status per majority of FAAC members: In progress. 

Financing: 

Area and selected FAAC recommendations: Support extending the 
alternative minimum tax (AMT) exemption for airport private activity 
bonds; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: In progress. 

Area and selected FAAC recommendations: Fund accelerated Next 
Generation Air Transportation System equipage of aircraft; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: In progress. 

Area and selected FAAC recommendations: Review eligibility criteria 
for the Airport Improvement Program and Passenger Facility Charge 
Program; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: In progress. 

Competitiveness and viability: 

Area and selected FAAC recommendations: Promote the global 
competitiveness of the U.S. aviation industry; 
Status per DOT/FAA officials: In progress; 
Status per majority of FAAC members: In progress. 

Labor and workforce: 

Area and selected FAAC recommendations: Ensure coordination and focus 
on science, technology, engineering, and math (STEM) education 
programs; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: Addressed. 

Safety: 

Area and selected FAAC recommendations: Seek legal protections for 
safety data; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: In progress. 

Area and selected FAAC recommendations: Support predictive analytic 
capabilities for safety data; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: In progress. 

Area and selected FAAC recommendations: Review and reprioritize FAA's 
rulemaking initiatives; 
Status per DOT/FAA officials: Addressed; 
Status per majority of FAAC members: In progress. 

Source: GAO analysis of DOT/FAA and FAAC member interviews. 

[End of table] 

Similar to DOT and FAA officials, FAAC members stated that some 
recommendations may not be fully addressed due to the recommendation's 
being linked to ongoing or long-term efforts. For example, FAAC 
members noted that DOT and FAA efforts to address the sustainable 
alternative fuels recommendation require collaborating across many 
agencies, such as the Department of Energy (DOE), the United States 
Department of Agriculture (USDA), and the Environmental Protection 
Agency (EPA), and a continued, long-term federal focus. In some cases, 
FAAC members stated that DOT and FAA should continue their current 
efforts to address the recommendations; but some FAAC members felt 
that DOT and FAA should take additional actions to address certain 
recommendations. For example, five of the six finance FAAC 
subcommittee members stated that the recommendation to fund 
accelerated NextGen equipage of aircraft was not addressed, and two 
suggested that the department take additional steps to collaborate 
with industry to design an incentive program and develop a stronger 
business case for airlines to invest in equipping early. Conversely, 
five of the seven subcommittee members believe that the department's 
actions addressed the recommendation on science, technology, 
engineering, and mathematics (STEM) education. For additional details 
on FAAC members' perspectives on the DOT and FAA actions to address 
the recommendations, see section 1 of this report. 

While DOT is not required to monitor or report on the status of the 
FAAC recommendations, 13 of the 17 FAAC members generally agreed that 
the department should continue monitoring and reporting on the 
recommendations' status, with some adding that this ensures continued 
focus on their implementation. On the other hand, two FAAC members 
stated that DOT should continue reporting only on certain 
recommendations, such as recommendations that would be implemented 
over the long term or recommendations it has not addressed. Another 
FAAC member stated that DOT and FAA should ensure that efforts to 
address the recommendations become ingrained into the daily work of 
agency staff, rather than DOT's and FAA's viewing them as a separate 
effort. The remaining FAAC member stated that DOT should reassess 
whether it makes sense to continue or close out the effort, adding 
that as time passes, the recommendations may become irrelevant or 
unlikely to be addressed. DOT officials told us that for ongoing 
recommendations, they will continue work on these recommendations and 
are determining the extent to which it will continue reporting on the 
status of the recommendations. However, DOT has not yet established a 
time frame for when it might make such a decision. 

Resource Constraints and Stakeholder Collaboration Were Most 
Frequently Cited as Implementation Challenges for the Selected 
Recommendations: 

Resource constraints and the need to collaborate with multiple 
stakeholders were cited most frequently by DOT and FAA officials, as 
well as by FAAC members, as implementation challenges. Specifically, 
DOT and FAA officials or FAAC members identified resource constraints, 
such as limited funding for programs or staff, as a challenge in 
implementing 6 of the 10 FAAC recommendations that we reviewed. These 
6 include the recommendations pertaining to sustainable fuels, carbon 
dioxide emission reductions, reviewing eligibility criteria for the 
Airport Improvement and Passenger Facility Charge Programs, STEM 
education, predictive safety risk-discovery capability, and 
prioritizing rulemaking. Agency officials and committee members also 
explained how constrained resources might affect progress in 
addressing these recommendations. For example, when discussing the 
recommendation that DOT and FAA establish a harmonized approach for 
aviation carbon dioxide emission reductions, FAA officials told us 
that resource constraints could hamper their ability to conduct 
necessary research and participate in international forums designed to 
foster discussion on harmonized regulatory approaches. However, DOT 
and FAA officials also outlined their methods for operating within 
these constraints. For example, while noting that funding and limited 
resources pose challenges to maintaining long-term STEM efforts, 
officials stated that the agencies work to leverage resources through 
stakeholder partnerships. In addition, DOT and FAA officials or FAAC 
members identified challenges in collaborating with and gaining the 
consensus of a number of stakeholders for four recommendations, those 
related to sustainable fuels, carbon dioxide emission reductions, 
global competitiveness, and STEM education. These recommendations 
range in the type of involvement needed both within and outside DOT 
and FAA. For example, six of the seven FAAC labor and workforce 
subcommittee members we interviewed recognized DOT's ongoing efforts 
on STEM issues require that DOT maintain the participation of outside 
groups, such as other agencies, industry, and other stakeholders. 

However, each recommendation also had unique challenges. For example, 
with respect to the recommendation that the agencies ensure that 
safety data submitted by air carriers and other stakeholders is 
protected from public disclosure, FAAC members noted that despite 
legal protections provided by recent legislation,[Footnote 8] industry 
concerns remain regarding the disclosure of safety data during legal 
proceedings. FAA officials have recognized that such concerns could 
limit the implementation of FAA efforts to promote safety management 
systems, which depend upon the open sharing of safety information 
among aviation stakeholders.[Footnote 9] In addition, DOT and FAA 
officials noted that in some cases they took actions to address the 
recommendation, but factors beyond DOT's control, such as the need for 
legislative action, affected DOT's ability to fully implement the 
recommendation. For example, while the agency supported a provision 
that would have extended the alternative minimum tax exemption for all 
private activity bonds, including airport private-activity bonds--as 
recommended by the FAAC--this provision did not become law. Agency 
officials view this recommendation as addressed since any further 
action would require legislative action, and there is not currently a 
legislative vehicle for this provision. 

Section 1 of this report includes the 10 recommendations in our 
review, detailed discussions of DOT and FAA completed or planned 
actions to address each of the 10 FAAC recommendations, FAAC members' 
assessment of DOT and FAA progress, and challenges to implementing 
each recommendation. 

Agency Comments: 

We provided DOT with a draft of this report for their review and 
comment. DOT responded by email and provided technical clarifications, 
which we incorporated into the report as appropriate. 

We are sending copies of this report to appropriate congressional 
committees, the Secretary of Transportation, and interested parties. 
This report will also be available at no charge on the GAO website at 
[hyperlink, http://www.gao.gov]. 

Should you or your staff have questions concerning this report, please 
contact me at (202) 512-2834 or dillinghamg@gao.gov. Contact points 
for our Offices of Congressional Relations and Public Affairs may be 
found on the last page of this report. Key contributors to this report 
are listed in appendix III. 

Signed by: 

Gerald L. Dillingham, Ph.D. 
Director, Physical Infrastructure Issues: 

List of Requesters: 

The Honorable John D. Rockefeller IV: 
Chairman: 
Committee on Commerce, Science, and Transportation: 
United States Senate: 

The Honorable Bill Shuster: 
Chairman: 
Committee on Transportation and Infrastructure: 
House of Representatives: 

The Honorable Frank A. LoBiondo: 
Chairman: 
Subcommittee on Aviation: 
Committee on Transportation and Infrastructure: 
House of Representatives: 

The Honorable John L. Mica: 
House of Representatives: 

The Honorable Thomas E. Petri: 
House of Representatives: 

[End of section] 

Section 1: Selected FAAC Recommendations and DOT's and FAA's Actions 
to Address Them: 

This section presents the 10 FAAC recommendations we reviewed and 
includes detail on DOT and FAA actions to address the recommendations, 
FAAC members' assessment of DOT and FAA progress on the 
recommendations, and challenges in implementing each recommendation. 
Also, we numbered these recommendations for reporting purposes, but 
these numbers do not align with the numbers assigned to these 
recommendations in the FAAC report. 

Table 3: FAAC Recommendations Selected for GAO Review and Location in 
Report: 

Area: Environment; 
FAAC recommendations: 
* Exercise strong national leadership to promote and showcase U.S. 
aviation as a first user of sustainable alternative fuels; 
Page number: 13. 

FAAC recommendations: 
* Establish a harmonized approach for aviation carbon dioxide emission 
reductions; 
Page number: 20. 

Area: Financing; 
FAAC recommendations: 
* Support extending the alternative minimum tax exemption for airport 
private activity bonds; 
Page number: 25. 

FAAC recommendations: 
* Fund accelerated NextGen equipage of aircraft; 
Page number: 29. 

FAAC recommendations: 
* Review eligibility criteria for the Airport Improvement Program and 
Passenger Facility Charge Program; 
Page number: 36. 

Area: Competitiveness and viability; 
FAAC recommendations: 
* Promote the global competitiveness of the U.S. aviation industry; 
Page number: 42. 

Area: Labor and workforce; 
FAAC recommendations: 
* Ensure coordination and focus on STEM education programs; 
Page number: 49. 

Area: Safety; 
FAAC recommendations: 
* Seek legal protections for safety data program participants; 
Page number: 57. 

FAAC recommendations: 
* Support predictive analytic capabilities for safety data and 
information; 
Page number: 62. 

FAAC recommendations: 
* Review and reprioritize FAA's rulemaking initiatives; 
Page number: 67. 

Source: FAAC report. 

[End of table] 

1. FAAC Recommendation--Sustainable Alternative Fuels: 

Issue Overview: 

According to the DOT's Transportation and Climate Change 
Clearinghouse, commercial aircraft accounted for about 2.5 percent of 
the total U.S. contribution of greenhouse gas emissions in 2006. We 
reported in June 2009 that global aviation's relative contribution to 
greenhouse gas emissions is forecasted to grow.[Footnote 10] The use 
of alternative fuels, including those derived from biological sources 
(biofuels), has the potential to reduce greenhouse gas emissions from 
aircraft in the future. A domestic source of alternative fuels also 
has the potential to provide energy security to the United States and 
fuel price stability for airlines. While the federal government has 
promoted biofuels as an alternative to petroleum-based fuels since the 
1970s, advanced biofuels--defined as renewable fuels that meet certain 
criteria, including ones that use cellulosic feedstocks such as corn 
stover or switchgrass--are at the earliest stages of being 
commercially produced in the United States.[Footnote 11] Numerous 
logistical and economic challenges, such as developing a sustainable 
feedstock supply and producing cost-competitive fuels, must be 
overcome before they are commercially viable. Several federal 
agencies--including DOT, United States Department of Agriculture 
(USDA), Department of Energy (DOE), Environmental Protection Agency 
(EPA), and Department of Defense (DOD)--play a role in developing the 
supply chain for alternative aviation fuels. Federal agency programs 
and efforts include support for: research and development; developing 
new fuel feedstocks, fuel conversion methods, environmental standards, 
and production methods; scaling up commercial production; and 
certifying new fuel production pathways. Within DOT, FAA's primary 
roles include sponsoring research studies; conducting and developing 
tools for environmental and cost analysis; funding certification and 
qualification testing to inform efforts by the standard-setting 
organization ASTM International;[Footnote 12] and enabling government 
and aviation industry coordination. FAA officials told us FAA does not 
have authority or funding to provide financial incentives for 
development and deployment of alternative aviation fuels. However, 
other federal agencies--such as the Internal Revenue Service, USDA, 
and DOE--have administered programs that provide numerous incentives, 
including subsidies through tax credits, to produce feedstocks, and 
refine and use biofuels. In its report, the FAAC stated that the 
aviation industry has unique fuel requirements and is well-positioned 
to be a national and international leader in the use of sustainable 
renewable alternative fuels. 

The FAAC recommended that DOT exercise strong national leadership to 
promote and display U.S. aviation as a first user of sustainable 
alternative fuels and provide increased support for FAA's work on 
alternative fuels. The FAAC discussed four specific areas in 
supporting its recommendation. 

DOT's and FAA's Actions to Address Recommendation: 

Table 4 provides a summary of the FAAC recommendation and underlying 
rationale, and DOT's and FAA's actions to address it, as of June 2013. 

Table 4: FAAC Recommendation on Sustainable Alternative Fuels and 
DOT's and FAA's Actions to Address It, as of June 2013: 

FAAC recommendation--alternative fuels[A]: Accelerate research and 
fuel approval--Additional federal support is needed to accelerate the 
development and approval of jet fuel specifications[B]; 
DOT/FAA actions: FAA conducts testing that supports the certification 
and qualification for new alternative aviation jet fuels. These 
activities are conducted through its Continuous Lower Energy, 
Emissions, and Noise (CLEEN) program,[C] as well as private contracts. 
Through these efforts, FAA supported ASTM International's approval of 
a bio-derived sustainable alternative "drop-in" jet fuel[D] known as 
Hydroprocessed Esters and Fatty Acids (HEFA) for commercial use in 
July 2011.[E] As of May 2013, FAA had 8 ongoing testing efforts that 
are intended to provide data to support certification and 
qualification of additional "drop-in" jet fuels from renewable 
sources, including sugars and cellulose.[F] In addition, FAA plans to 
select a new Center of Excellence that will include a focus on 
alternative jet fuels later this fall and have it operational by the 
end of calendar year 2013.[G] FAA is also collaborating with other 
entities that conduct research supporting alternative aviation fuels, 
including other federal agencies and international governments, 
through the Commercial Aviation Alternative Fuels Initiative (CAAFI) 
as well as direct interaction.[H] 

FAAC recommendation--alternative fuels[A]: Provide incentives to 
accelerate development and deployment--It would be of significant help 
if in addition to FAA's current research funding, it were empowered to 
provide and promote funding to support deployment of alternative 
aviation fuels; 
DOT/FAA actions: Absent new legislation that provides FAA authority 
and a new funding source, FAA officials noted that they leverage 
existing mechanisms and funding within other federal agencies by 
encouraging them to include aviation fuels as part of their own 
incentive programs. For example, it supports EPA's Renewable Fuel 
Standard program (RFS2)--which created a credit market for renewable 
transportation fuels, of which some aviation jet fuels are approved to 
receive credit--by conducting emissions testing of alternative fuels 
through one of its Centers of Excellence and providing data that 
support EPA's approval of new fuels under the program.[I] In addition, 
through the Farm to Fly initiative and its extension,[J] FAA and USDA 
have partnered with industry in assisting American farmers in the 
selection and cultivation of energy crops for conversion into 
affordable and sustainable aviation biofuels. FAA officials also noted 
that FAA is coordinating with DOE and DOD on their deployment 
activities both directly and via CAAFI. 

FAAC recommendation--alternative fuels[A]: Ensure crediting of 
environmental benefit at the point of purchase--FAA should work to 
establish a regulatory structure that will provide the environmental 
credit to the air carrier purchasing the fuel--commonly referred to as 
a "book and claim" crediting approach; 
DOT/FAA actions: FAA officials said that a precursor to developing a 
regulatory framework for how to credit alternative fuel purchases is 
to have a recognized method for calculating the credit. As discussed 
below, FAA undertakes such efforts through its own analyses, as well 
as collaborating with other agencies on efforts to analyze 
environmental and economic impacts, as well as sustainability of 
alternative jet fuels. 

FAAC recommendation--alternative fuels[A]: Ensure accepted 
environmental criteria for alternative fuels, domestically and 
internationally--The DOT/FAA should develop and execute a plan, 
working with government, industry, and other relevant domestic 
stakeholders to develop and confirm environmental criteria, including 
associated life-cycle analysis protocols, for aviation alternative 
fuels. The DOT/FAA should also work to facilitate international 
acceptance of these criteria so the benefits of alternative aviation 
fuels can be available domestically and internationally; 
DOT/FAA actions: As of May 2013, FAA had six on-going efforts--some of 
which are through one of its Centers of Excellence and the John A. 
Volpe National Transportation Systems Center--that focus on 
environmental impacts, economic impacts, feasibility, and 
sustainability of alternative jet fuels, among other things. FAA also 
collaborates with other Federal agencies--including DOD, EPA, and DOE--
on domestic efforts to develop life-cycle analysis protocols. CAAFI 
stakeholders are currently examining how CO2 emissions would differ 
under different policies and regulatory assumptions, including those 
under EPA's RFS2 program and the European Union's renewable energy 
directive. FAA follows international efforts and shares best practices 
with the United Nation's International Civil Aviation Organization 
(ICAO) and other countries. For example, FAA has formal agreements to 
cooperate with Australia, Brazil, Germany, and Spain on issues related 
to alternative aviation fuels. 

Source: FAAC report and GAO analysis of FAA documents and interviews. 

[A] The FAAC recommended that DOT exercise strong national leadership 
to promote and display U.S. aviation as a first user of sustainable 
alternative fuels and provide increased support for FAA's work on 
alternative fuels. The FAAC discussed four specific areas in 
supporting its recommendation. 

[B] FAA does not certify aviation fuel, rather FAA certifies that 
aircraft, including engines and accessories, meet FAA airworthiness 
standards. Those standards require engines to use fuels that meet 
specific ASTM standards. 

[C] FAA's CLEEN program is an effort to accelerate development and 
commercial deployment of environmentally promising aircraft 
technologies and sustainable alternative fuels. CLEEN is part of 
NextGen, FAA's program to transform the nation's ground-based air-
traffic control system to an air-traffic management system using 
satellite-based navigation and other advanced technology. 

[D] "Drop-in" means that the fuel can be used without changes to 
aircraft systems or fueling infrastructure. 

[E] This approval was for a 50 percent blend of HEFA jet fuel with Jet 
A. 

[F] FAA provides data to five working groups within ASTM International 
that are currently each looking at a new potential alternative jet 
fuel pathway. 

[G] FAA issued a final solicitation for the new Center of Excellence, 
which closed March 20, 2013. Establishment of the Center was permitted 
under the FAA Modernization and Reform Act, Pub. L. No. 112-95, § 
911(d), 126 Stat. 11, 142. 

[H] CAAFI is a coalition of airlines, aircraft and engine 
manufacturers, energy producers, researchers, international 
participants, and U.S. government agencies seeking to enhance energy 
security and environmental sustainability for aviation by exploring 
the use of alternative jet fuels. 

[I] In 2010, EPA approved jet fuel pathways under the RFS2 program, 
and in March 2013, EPA clarified that these jet fuel pathways qualify 
for credits as renewable diesel. 

[J] The Farm to Fly initiative brought together the U.S. aviation 
community, government stakeholders, USDA, DOE, DOT, and DOD, to 
express unified support for the President's goals of environmental 
stewardship and energy independence, and furthered a commitment of 
resources dedicated to research and development and deployment through 
public-sector leadership and financial incentives to bring production 
online. The Secretaries of Agriculture and Transportation joined 
others on April 15, 2013, to sign a 5-year extension agreement of the 
Farm to Fly initiative. 

[End of table] 

DOT's and FAA's Planned Actions: 

FAA officials told us they view actions to address this recommendation 
as a long-term effort given that its goals for the development of 
alternative aviation fuels--that is, for the U.S. aviation industry to 
displace 1-billion gallons of petroleum jet fuel with alternative jet 
fuel by 2018 and to achieve carbon neutral growth by 2020 (baseline 
year of 2005)--are several years or more away. Because of the long-
term nature of this effort, officials told us they plan to continue 
FAA's research and collaboration with other agencies, industry groups, 
and other countries. 

FAAC Members' Assessment of DOT's and FAA's Progress: 

All five of the FAAC environmental subcommittee members we interviewed 
expressed support for FAA's actions to address this recommendation, 
adding that fully addressing this recommendation will require a long-
term, ongoing effort and collaboration with a number of parties. For 
example, some subcommittee members identified additional actions that 
they think FAA or the federal government should take in response to 
this recommendation. Two subcommittee members noted the need for an 
increased federal focus on supporting the deployment and commercial 
viability of alternative fuels through tax incentives, public-private 
partnerships, direct support, or other means to encourage industry to 
invest its capital. One subcommittee member stated that while DOT or 
FAA may not have the statutory authority to provide incentives to 
accelerate development and deployment, they should explore their 
authority to support additional deployment activities. In our 
discussions with FAA officials on this issue, they stated that FAA has 
not sought direct authority for these activities because they believe 
that it is a wiser use of federal resources to use existing federal 
support mechanisms that are funded by USDA and DOE. Another 
subcommittee member stated that more overall federal funding is needed 
for research on conversion technology and getting through the fuel 
approval process, and that the research projects that receive federal 
funding should be focused specifically on producing the data needed 
for fuel approval, rather than addressing broader issues. In addition, 
this subcommittee member stated that FAA should increase its outreach 
and collaboration with other groups such as the Sustainable Aviation 
Fuel Users Group, the Sustainable Aviation Biofuels for Brazil effort, 
and the Midwest Aviation Sustainable Biofuels Initiative. According to 
FAA officials, the agency is engaged in the latter two initiatives. 

Challenges in Implementing the Recommendation: 

* Resource constraints. FAA officials and two of the subcommittee 
members stated that resources, specifically funding for the programs 
and staff time to work on the projects, pose a challenge in addressing 
this recommendation. Subcommittee members raised concerns about budget 
uncertainty affecting the agencies' abilities to support long-term 
efforts in this area. 

* Scalable, affordable, and sustainable fuel supply. FAA officials and 
two subcommittee members also pointed out the challenges related to 
scalability--that is, being able to produce sufficient quantities of 
alternative aviation fuel at a reasonable price. FAA officials noted 
that building a sustainable supply chain would be a challenge. 
However, officials said that the production activities by USDA, DOE, 
and DOD could help establish the market, and the programs at DOE, EPA, 
and USDA should help lower costs and make commercialization possible. 
FAA officials added that more time, continued funding, and political 
support will help them achieve their goals. 

* Uncertainties inherent in new fuels technologies. According to FAA 
officials, part of the underlying challenge of developing a 
sustainable supply chain is the limited financial investment by 
private industry due, in part, to risk associated with uncertainties. 
Such uncertainties include the ability of alternative fuels to compete 
with petroleum and the effects of possible future regulatory changes, 
such as the sustainability of tax credits, grants, or loan guarantees 
that support the development and commercialization of alternative jet 
fuel, factors which are not under FAA's authority. 

* Collaboration with many stakeholders. Three subcommittee members 
identified challenges related to the need to collaborate with many 
stakeholders on this recommendation. For example, a subcommittee 
member also noted the need to collaborate with non-aviation 
stakeholders, such as agriculture-financing representatives, while two 
other members highlighted that work on this recommendation is a multi-
agency process. 

We recently began work in this area examining the progress made in 
developing alternative jet fuels in the United States, as well as the 
key challenges that exist and federal efforts that should be taken to 
address those challenges. We plan to report the results of our work in 
2014. 

Related Products: 

Biofuels: Potential Effects and Challenges of Required Increases in 
Production and Use. [hyperlink, 
http://www.gao.gov/products/GAO-09-446]. Washington, D.C.: August 25, 
2009. 

Aviation and Climate Change: Aircraft Emissions Expected to Grow, but 
Technological and Operational Improvements and Government Policies Can 
Help Control Emissions. [hyperlink, 
http://www.gao.gov/products/GAO-09-554]. Washington, D.C.: June 8, 
2009. 

Aviation and the Environment: NextGen and Research and Development Are 
Keys to Reducing Emissions and Their Impact on Health and Climate. 
[hyperlink, http://www.gao.gov/products/GAO-08-706T]. Washington, 
D.C.: May 6, 2008. 

2. FAAC Recommendation--Harmonized Approach to CO2 Reduction: 

Issue Overview: 

As previously noted, commercial aviation's contribution to greenhouse 
gas emissions is reported to be relatively small, but is forecasted to 
grow, with carbon dioxide (CO2) emissions being the most significant 
greenhouse gas.[Footnote 13] The 1997 Kyoto Protocol, an international 
agreement to minimize the adverse effects of climate change, stated 
that greenhouse gases from aviation fuels should be limited or 
reduced, and that such efforts should be conducted through ICAO. 
[Footnote 14] In 2010, the ICAO Assembly agreed upon the following 
goals: 

* achieve a global annual average fuel efficiency improvement rate of 
2 percent until 2020 and pursue an aspirational global fuel efficiency 
improvement rate of 2 percent per year from 2021 to 2050; and: 

* achieve global carbon-neutral growth from 2020 onward.[Footnote 15] 

The United States and two airline industry groups--the International 
Air Transportation Association and Airlines for America--also 
established greenhouse-gas emission reduction goals. In line with the 
ICAO goals, FAA adopted a goal improving the National Airspace 
System's energy efficiency by at least 2 percent per year, and a goal 
of achieving carbon neutral growth by 2020 using a baseline of 2005. 
The industry groups agreed to a goal of improving fuel efficiency by 
1.5 percent per year, rather than 2 percent, and achieving carbon-
neutral growth from 2020, and set another explicit goal to halve CO2 
emissions by 2050 relative to 2005 levels. 

However, the European Union (EU) took unilateral steps on this issue 
by including aviation in the EU Emissions Trading Scheme (ETS), a cap-
and-trade system. Under ETS, the EU places a cap on emissions and 
requires airlines to secure allowances to emit greenhouse gasses. The 
EU provides most of the allowances at no charge, but sells about 15 
percent of the allowances to the airlines. ETS was to be applied to 
flights arriving or departing at an EU airport, including those 
arriving from and departing to non-EU ETS countries, beginning in 
January 2012, but those efforts have been delayed. In April 2013, the 
EU approved a one-year suspension. Under the terms of the suspension, 
ETS continues to apply to all flights that depart and land in an EU 
country, but does not apply to flights that depart to or arrive from 
another region. The EU is awaiting action by ICAO to determine its 
next steps. 

Given that the large U.S. commercial airlines serve a global network, 
the FAAC raised concerns on the number of proposals for taxes, 
emissions trading, and other methods intended to constrain emissions, 
noting that overlapping and conflicting proposals could hinder 
progress and siphon funds from industry investments in effective 
emissions reduction methods. For example, in addition to the EU ETS, 
according to the FAAC report, some countries also have their own 
environmental fees on airline activities. 

DOT's and FAA's Actions to Address Recommendation: 

Table 5 provides a summary of the FAAC recommendation to establish a 
harmonized framework for CO2 reductions and DOT's and FAA's actions to 
address it, as of June 2013. 

Table 5: FAAC Recommendation on Establishing a Harmonized Framework 
for Aviation CO2 Reductions and DOT's and FAA's Actions to Address It, 
as of June 2013: 

FAAC recommendation--emission reduction: Lead an effort to align 
Federal aviation policy to support an aviation sector approach to 
carbon emissions by specifically: 
* Building on the International Civil Aviation Organization (ICAO) 
resolution adopted on October 8, 2010, advocate for a coordinated 
global and domestic framework for aviation CO2 emissions; 
* Taking advantage of industry assets to develop practical global 
implementation methods; 
DOT/FAA actions: FAA officials stated they engaged with other agencies 
and industry to establish a domestic approach to reducing CO2 
emissions and participate in ICAO's efforts to establish an 
international consensus on CO2 reduction goals. According to FAA 
officials, while these discussions preceded the issuance of the FAAC 
report in April 2011, the effort to establish a framework to reduce 
emissions is an ongoing process. The officials said that the European 
Union's (EU) Emissions Trading Scheme (ETS) and other unilateral 
efforts to curb emissions helped galvanize efforts to reach consensus 
at ICAO. 
FAA and DOT publicly opposed the ETS in favor of multilateral 
discussions at ICAO. Congress reaffirmed this position in the FAA 
Modernization and Reform Act of 2012 passed in February 2012[A] and in 
the European Union Emissions Trading Scheme Prohibition Act of 2011.b 
Partially as a result of this opposition, the EU approved a one-year 
suspension of ETS in April 2013 for flights between countries 
participating in EU ETS and countries that are not. 
To meet the October 2011 goals agreed upon through ICAO, FAA--working 
with other federal agencies and the aviation industry--developed an 
Aviation Environmental and Energy Policy Statement (Policy Statement) 
as well as an Aviation Greenhouse Gas Emissions Reduction Plan 
(Reduction Plan). The Reduction Plan describes how FAA, other federal 
agencies, and the industry will meet these goals: 
* improve flight operations with NextGen[C]; 
* improve aircraft and engine technology; 
* support the development and deployment of alternative fuels; 
* develop policy mechanisms to supplement efforts on technology, 
operations and fuels; and; 
* conduct research into the environmental impacts of aviations 
emissions. 
This approach is generally consistent with what aviation experts told 
us in 2009--that is, operational improvements stemming from NextGen, 
such as more direct plane routing, and research and development of 
engine and aircraft technologies will help reduce greenhouse gas 
emissions in the aviation sector.[D] 

Source: FAAC report and GAO analysis of FAA documents and interviews. 

[A] Pub. L. No. 112-95, § 509, 126 Stat. 11, 106-107. 

[B] Pub. L. No. 112-200, §§ 2, 3, 126 Stat 1477, 1478 (2012). 

[C] FAA, in collaboration with other federal agencies and the aviation 
industry, is transforming the nation's ground-based air-traffic 
control system to an air-traffic management system using satellite-
based navigation and other technology. This transformation is referred 
to as NextGen. GAO has noted that NextGen, if implemented effectively, 
can help reduce aviation emissions by allowing for more direct 
routing, which could improve fuel efficiency and reduce carbon dioxide 
emission. Additional information on NextGen can be found in this 
report, in the discussion of recommendation 4. 

[D] GAO, Aviation and Climate Change: Aircraft Emissions Expected to 
Grow, but Technological and Operational Improvements and Government 
Policies Can Help Control Emissions, GAO-09-554 (Washington, D.C.: 
June 8, 2009). 

[End of table] 

DOT's and FAA's Planned Actions: 

FAA officials stated that addressing this recommendation is a long-
term effort and noted their ongoing efforts in this area. For example, 
FAA officials noted that continued domestic and international 
coordination are required to address this recommendation. FAA 
officials said implementing its Reduction Plan will continue to 
require sustained collaboration with partner agencies such as the 
National Aeronautics and Space Administration and the aviation 
industry. FAA officials said they would advocate that countries' 
reduction plans be updated on a triennial basis and would plan to 
update the U.S. Reduction Plan in 2015 and triennially afterward, if 
requested by future ICAO agreements. Officials also told us that they 
will participate in discussions on market-based measures at the 
upcoming ICAO Assembly meeting in September 2013.[Footnote 16] 

FAAC Members' Assessment of DOT's and FAA's Progress: 

All five of the FAAC environmental subcommittee members told us that 
the recommendation was not fully addressed, noting that work in this 
area was ongoing and that FAA should continue their involvement in 
ICAO's ongoing efforts. 

Challenges in Implementing the Recommendation: 

* Obtaining stakeholder consensus. GAO previously found that it is 
important to coordinate when dealing with a global aviation network. 
[Footnote 17] FAA officials and FAAC subcommittee members noted that 
an inherent challenge with this recommendation is the need to obtain 
consensus among an array of stakeholders, such as other federal 
agencies, industry stakeholders, and the many countries participating 
in ICAO. FAA officials recognized the threat of unilateral proposals 
to reduce aviation emissions via a market-based mechanism, such as the 
ETS, as a challenge to obtaining a harmonized approach. In addition, 
one subcommittee member raised concerns about FAA's and the industry's 
ability to meet FAA's more stringent goal for carbon-neutral growth 
using 2005 as the baseline year versus ICAO and industry goals that 
use 2020 as the baseline year. FAA officials have acknowledged that 
industry was concerned with the 2005 baseline, but said that they have 
adopted this goal because it is consistent with the U.S. government's 
commitment made during the 2009 round of U.N. negotiations on climate 
change (the Copenhagen Accord) and reflects the position that the 
United States, Mexico, and Canada jointly took prior to the ICAO 
Assembly meeting in 2010. 

* Resource constraints. FAA officials and a FAAC member told us that 
sustained federal financial support will be necessary to achieve the 
technical and operational improvements that are expected to result in 
emissions reductions consistent with ICAO and FAA goals. For example, 
resource constraints at the agency could hamper efforts to implement 
NextGen within the expected time frames; conduct necessary research 
and development of new technologies, including sustainable alternative 
jet fuels; and participate in the work and discussions at ICAO and 
other forums. 

Related Products: 

NextGen Air Transportation System: FAA Has Made Some Progress in 
Midterm Implementation, but Ongoing Challenges Limit Expected 
Benefits. [hyperlink, http://www.gao.gov/products/GAO-13-264]. 
Washington, D.C.: April 8, 2013. 

Aviation and Climate Change: Aircraft Emissions Expected to Grow, but 
Technological and Operational Improvements and Government Policies Can 
Help Control Emissions. [hyperlink, 
http://www.gao.gov/products/GAO-09-554]. Washington, D.C.: June 8, 
2009. 

International Climate Change Programs: Lessons Learned from the 
European Union's Emissions Trading Scheme and the Kyoto Protocol's 
Clean Development Mechanism. [hyperlink, 
http://www.gao.gov/products/GAO-09-151]. Washington, D.C.: November 
18, 2008. 

Aviation and the Environment: NextGen and Research and Development Are 
Keys to Reducing Emissions and Their Impact on Health and Climate. 
[hyperlink, http://www.gao.gov/products/GAO-08-706T]. Washington, 
D.C.: May 6, 2008. 

Aviation and the Environment: Strategic Framework Needed to Address 
Challenges Posed by Aircraft Emissions. [hyperlink, 
http://www.gao.gov/products/GAO-03-252]. Washington, D.C.: February 
28, 2003. 

3. FAAC Recommendation--Support Extending the Alternative Minimum Tax 
Exemption: 

Issue Overview: 

Municipal bond proceeds are a significant funding source for airports' 
capital development.[Footnote 18] Municipal bonds for airports are 
generally classified as private activity bonds, since the bond 
proceeds are used for private business purposes. The private activity 
bonds for airports are tax-exempt (also known as "qualified" private 
activity bonds).[Footnote 19] However, qualified private activity 
bonds are subject to restrictions that do not apply to governmental 
bonds. Among these restrictions, the interest income from qualified 
private activity bonds is included in income when calculating the 
alternative minimum tax (AMT), whereas the interest on governmental 
bonds is not.[Footnote 20] A bondholder whose total income reached the 
level subject to the AMT would have to pay tax on the interest earned 
from airport qualified private activity bonds. 

The FAAC argued that investors in these bonds demand an interest rate 
premium to compensate for the AMT tax liability, which can raise the 
costs of airport projects. The American Recovery and Reinvestment Act 
of 2009 exempted new issuances of all private activity bonds from the 
AMT in 2009 and 2010, and allowed for the refinancing of some private 
activity bonds into non-AMT debt.[Footnote 21] 

DOT's and FAA's Actions to Address Recommendation: 

Table 6 provides a summary of the FAAC recommendation to support 
extending the AMT exemption and DOT's and FAA's actions to address it, 
as of June 2013. 

Table 6: FAAC Recommendation on Extending the AMT Exemption for 
Private Activity Bonds and DOT's and FAA's Actions to Address It, as 
of June 2013: 

FAAC recommendation--AMT exemption: Support federal legislation to 
provide a 4-year extension of the alternative minimum tax (AMT) 
exemption for private activity bonds; 
DOT/FAA actions: In May 2012, DOT sent a letter to Congress supporting 
adoption of the Moving Ahead for Progress in the 21st Century Act.[A] 
DOT specifically supported a provision of the bill that included 
support for extending the AMT exemption for all private activity 
bonds, including airport private-activity bonds; however, the AMT 
exemption was not included in the final legislation. 

Source: FAAC report and GAO analysis of DOT and FAA documents and 
interviews. 

[A] Adopted as the Moving Ahead for Progress in the 21st Century Act, 
Pub. L. No. 112-141, 126 Stat. 405 (2012). 

[End of table] 

DOT's and FAA's Planned Actions: 

FAA officials told us that any further action on extending the AMT 
exemption to private activity bonds would require legislative action, 
and there is not currently a legislative vehicle for this 
provision.[Footnote 22] As a result, DOT does not plan to take any 
additional actions and considers the recommendation to be closed. 

FAAC Members' Assessment of DOT's and FAA's Progress: 

While all six of the FAAC finance subcommittee members acknowledged 
that extending the AMT exemption requires legislation, five of the six 
stated that DOT should continue to work for passage of an AMT 
exemption for airport private activity bonds. Two subcommittee members 
stated that in their view, DOT should reach out to aviation and 
airport industry stakeholders to leverage their support for the 
exemption. One subcommittee member did not think that an AMT exemption 
should be included in legislation without a cost-benefit analysis. 

Challenges in Implementing the Recommendation: 

* Mixed perspectives on the appropriateness of the AMT exemption. FAA 
may face challenges encouraging congressional action on this 
recommendation due to mixed perspectives on the appropriateness of tax-
exemptions for bond financing. Our prior work has shown the importance 
of determining the economic efficiency of applying preferential tax 
treatment to selected investments.[Footnote 23] High-level analyses of 
the AMT exemption have shown it leads to a loss of federal revenue, 
but data specific to airports is limited.[Footnote 24] However, FAA 
and industry stakeholders counter that exempting airport private 
activity bonds has led to significant savings. FAA conducted an 
analysis of the financial impact of the AMT exemption in the American 
Recovery and Reinvestment Act of 2009, and stated that the exemption 
resulted in significant savings for airports, increased capital 
investment, and increased employment. Our tax expenditure guide 
provides useful resources for evaluating the efficiency of applying 
preferential tax treatment to selected investments, and could assist 
Congress as it considers these provisions.[Footnote 25] 

* Legislative change. As previously noted, any further action on 
extending the AMT exemption to private activity bonds will require 
legislative action. One FAAC subcommittee member noted that airport 
stakeholders may face challenges in lobbying for such an exemption 
given their limited financial resources and lack of natural alliances 
with other industries that previously received an exemption from the 
AMT. 

Related Products: 

Tax Expenditures: Background and Evaluation Criteria and Questions. 
[hyperlink, http://www.gao.gov/products/GAO-13-167SP]. Washington, 
D.C.: November 29, 2012. 

Tax Policy: Tax-Exempt Status of Certain Bonds Merits Reconsideration, 
and Apparent Noncompliance with Issuance Cost Limitations Should Be 
Addressed. [hyperlink, http://www.gao.gov/products/GAO-08-364]. 
Washington, D.C.: February 15, 2008. 

Airport Finance: Observations on Planned Airport Development Costs and 
Funding Levels and the Administration's Proposed Changes in the 
Airport Improvement Program. [hyperlink, 
http://www.gao.gov/products/GAO-07-885]. Washington, D.C.: June 29, 
2007. 

4. FAAC Recommendation--Funding Accelerated NextGen Equipage of 
Aircraft: 

Issue Overview: 

FAA is transforming the nation's ground-based air-traffic control 
system to an air-traffic management system using satellite-based 
navigation and other technology. This transformation is referred to as 
NextGen. NextGen is intended to enhance airspace safety, reduce 
delays, save fuel, and reduce carbon dioxide emissions and other 
adverse environmental impacts. 

While some operational improvements can be made with existing aircraft 
equipment, realizing more significant benefits of NextGen necessitates 
additional investment by airlines in new technologies to establish a 
critical mass of properly equipped aircraft.[Footnote 26] However, GAO 
and others have noted that a variety of disincentives may deter 
operators from investing early in NextGen equipment. For example, we 
have reported that aircraft operators may be hesitant to make 
investments in equipment if they do not have confidence that FAA will 
deliver the systems, procedures, and capabilities to realize the 
benefits from their investments.[Footnote 27] In addition, the FAAC 
report identified challenges for FAA to overcome in encouraging 
operators to equip early, including: (1) prior instances in which 
operators equipped aircraft but received little or no benefit because 
the FAA did not implement quickly enough the necessary procedures or 
approvals to enable operators to derive benefits from the equipment; 
and (2) the business case may be weak for individual operators to 
purchase and install equipment early, with costs far exceeding 
expected direct benefits to users. 

The FAAC noted that accelerated deployment of NextGen could lead to 
capacity, efficiency, environmental, and safety benefits. It also 
emphasized the need to overcome challenges in encouraging operators to 
equip early by providing some form of public financing to incentivize 
equipage. One FAAC finance subcommittee member formally dissented to 
this recommendation and questioned the need for public financing of 
airline equipment, citing a lack of evidence that the benefits gained 
from equipment investments would not be sufficient to encourage 
industry adoption without government subsidies. 

DOT's and FAA's Actions to Address Recommendation: 

Table 7 provides a summary of the FAAC recommendation to accelerate 
investment and installation of NextGen equipment on aircraft and FAA's 
actions to address it, as of June 2013. 

Table 7: FAAC Recommendation on Accelerating NextGen Equipage and 
DOT's and FAA's Actions to Address It, as of June 2013: 

FAAC recommendation--accelerated equipage: Undertake a significant 
financial investment to achieve extensive public benefits through the 
accelerated equipage of commercial and general aviation aircraft with 
NextGen equipment and technologies: 
* The federal commitment must be matched in some fashion by financial 
or operational commitments--for example reduced carbon dioxide 
emission on the part of aviation operators; 
* This public-private partnership should focus on equipping aircraft 
and training staff to use key NextGen technology and operational 
capabilities including Performance-Based Navigation (PBN), Automatic 
Dependent Surveillance-Broadcast (ADS-B), Ground-Based Augmentation 
System, and Data Communications; 
* A menu of financial options--grants, loans, leases, and loan 
guarantees--should be designed in consultation with industry, and this 
financing could be managed through an infrastructure bank or other 
financing vehicle. The form and structure of the financial options 
offered depend on the appropriateness of the incentive for the 
technology and capability being funded, the aviation operators 
involved, the costs and benefits associated with the particular 
technology or operational capability, and the shared responsibility 
between the public and private partners. An important part of this 
program will be the detailing of commitments that both the FAA and 
operators should make to deliver promised benefits or mitigate 
financial or other risk; 
DOT/FAA actions: At the request of FAA, in September 2011, the NextGen 
Advisory Committee (NAC)[A] recommended specific avionics required to 
achieve NextGen midterm capability goals, as well as the types of 
operational benefits necessary to incentivize operators to further 
invest in these avionics. In February 2012, FAA received authority 
through the FAA Modernization and Reform Act to establish a program to 
facilitate public-private financing for equipping commercial-and 
general-aviation aircraft with NextGen technologies.[B] 
FAA is in the process of determining how to structure a financial 
incentive program that would encourage deployment of NextGen-capable 
aircraft sooner than would have occurred without such funding 
assistance in place. Since FAA does not have funding for the incentive 
program and the statute directed FAA to maximize private sector 
capital, FAA officials said that they reached out to other federal 
agencies, such as the Departments of Agriculture, Education, Energy, 
and the modal administrations of Transportation to understand various 
options for establishing a loan-guarantee program. Based on the NAC's 
recommendations, FAA proposed two avionics equipage bundles focused on 
operators: one for air carriers flying in the busiest metroplexes and 
one for operators that fly elsewhere. Each equipage bundle identified 
minimum and operational equipment. FAA then conducted outreach through 
public meetings, market surveys, and individual meetings with aviation 
representatives to get industry perspectives on the overall program 
structure and the proposed equipage bundles. 
FAA officials noted that the efforts to establish a financial 
incentive program is one piece in a broader effort to develop 
incentives for aircraft operators. FAA has also noted the need to 
demonstrate the benefits of NextGen equipment, which would help create 
a business case for operators to equip early.[C] For example, FAA has 
entered into agreements with JetBlue, UPS, and United Airlines to 
provide or upgrade equipment and obtain ADS-B data to validate the 
business case for early adoption of ADS-B.[D] FAA officials stated 
that these ADS-B data will help the agency measure operational 
benefits, reduce uncertainty, and help to determine time frames for 
the carriers to obtain a return on their investment. In addition, 
FAA's Data Communications (DataComm) contract includes an incentives 
goal to equip 1,900 aircraft to create a critical mass of equipped 
aircraft and demonstrate the benefits of equipping with this 
technology.[E] 

Source: FAAC report and GAO analysis of DOT and FAA documents and 
interviews. 

[A] The NAC is comprised of aviation stakeholders from the government 
and industry. The NAC was set up by RTCA at the request of FAA, and is 
the follow-on to RTCA's Air Traffic Management Advisory Committee. The 
NAC working group seeks to develop a common understanding of 
priorities in the context of overall NextGen capabilities and 
implementation constraints, with an emphasis on improvements through 
2018. The committee primarily focuses on implementation issues, 
including prioritization criteria at a national level, joint 
investment priorities, and location and timing of capability 
implementation. 

[B] Pub. L. No. 112-95, § 221(a), 126 Stat. 11, 53. 

[C] FAA's current NextGen implementation plans includes midterm 
implementation activities through 2020 and the long term to 2025 and 
beyond. 

[D] ADS-B is a surveillance technology that, in part, enables aircraft 
to continually broadcast flight data, such as position, air speed, and 
altitude, among other types of information, to air traffic controllers 
and other aircraft for more precise tracking of aircraft. 

[E] DataComm is a next generation data communications system that is 
intended to provide a digital communications link for two-way data 
exchanges between controllers and flight crews. 

[End of table] 

DOT's and FAA's Planned Actions: 

FAA officials stated FAA has addressed this recommendation, with the 
help of the authority granted in the FAA Modernization and Reform Act. 
Officials noted that they are still working to determine what the 
program will entail, including soliciting input from aircraft 
operators and potential private partners to determine how to establish 
an incentive program that operators want to participate in. In 
addition, the appropriations requirements for a loan guarantee program 
has not yet been met.[Footnote 28] FAA officials also noted that they 
are considering how to administer the loan guarantee program and FAA 
may need to issue a contract for an external group to fulfill this 
role; however, FAA currently does not have funding to do so. 

FAAC Members' Assessment of DOT's and FAA's Progress: 

Five of the six finance FAAC subcommittee members stated that the 
recommendation was not fully addressed, although one subcommittee 
member did not agree with the recommendation, as noted earlier. The 
remaining subcommittee member said FAA had addressed the 
recommendation, but noted that it still needed legislative authority 
to issue loan guarantees. Of the five subcommittee members who said it 
was not fully addressed, two members stated that FAA is taking steps 
to address the recommendation. Two other members stated that FAA 
should take additional steps to collaborate with industry to design an 
incentive program and develop a stronger business case for airlines to 
invest in equipping early. These two subcommittee members felt that 
FAA should conduct additional outreach on these issues, with one 
stating that FAA should have reached out to industry to discuss 
various incentive options prior to taking steps to create a loan-
guarantee program. FAA officials noted that while they have been 
focused on possibly establishing a loan guarantee program given the 
mandate to maximize private investment and a lack of funding for a 
different type of program, they have solicited input from industry on 
ideas for other incentive programs that would maximize private 
investment and have not received any specific suggestions. 

Challenges in Implementing the Recommendation: 

* Demonstrating benefits to encourage industry participation. FAA 
officials and two FAAC members noted that beyond providing financial 
incentives, demonstrating operational benefits is key to encouraging 
early equipage by operators. However, FAA officials explained that the 
extent to which a new capability or procedure provides an operational 
benefit will vary among carriers. For example, if a new procedure is 
deployed in airspace where a carrier is not operating, the carrier 
will not receive a benefit from early equipage. FAA officials noted 
they are working to address this challenge by asking operators--
through market surveys, as well as public and private meetings--
whether providing certain services in certain locations would 
encourage operators to invest in equipment earlier. However, FAA 
officials told us they have generally faced difficulties in collecting 
specific information on which capabilities and locations specific 
operators would be interested in. 

* Reducing uncertainty with NextGen time frames. We have found that 
stakeholders are concerned that FAA has not made sufficient progress 
in deploying systems and producing benefits. For example, a past FAA 
program's cancellation contributed to skepticism about FAA's 
commitment to follow through with its plans.[Footnote 29] Two FAAC 
subcommittee members noted that FAA's timely installment of 
infrastructure, including equipment at airports and FAA facilities, is 
essential to realizing NextGen benefits. Along those same lines, 
another FAAC subcommittee member noted that FAA needs to make a 
business case for airlines to invest within time frames that FAA can 
deliver on the benefits so that the equipment does not become 
obsolete. Three subcommittee members also noted that uncertainty 
regarding NextGen time frames would pose a challenge to convincing 
operators to equip, with two subcommittee members noting that 
sequestration[Footnote 30] has introduced an additional level of 
uncertainty into NextGen implementation time frames. In April 2013, we 
noted that stakeholders, including RTCA and the NextGen Advisory 
Committee, have stressed the need for additional information to 
understand the potential direct costs, benefits, and return on 
investments that might be realized from technological and equipage 
investments.[Footnote 31] While FAA's NextGen plans include some 
examples of benefits, RTCA reported in 2011 that available FAA plans 
do not include sufficient information for airlines making investment 
decisions such as forecast benefits by either location or usage, or 
the proportion of the local fleet that is currently equipped.[Footnote 
32],[Footnote 33] We noted that without greater certainty on when and 
where NextGen improvements are planned, airlines and others are 
unlikely to invest in the equipment, staffing, and training needed to 
help achieve the full benefits of NextGen implementation. We 
recommended FAA assure that NextGen planning documents provide 
stakeholders information on how and when operational improvements are 
expected to achieve NextGen goals and targets.[Footnote 34] In June 
2013, DOT concurred with our recommendation and stated that it has 
efforts underway to better integrate various NextGen plans to provide 
more of this type of information. 

Related Products: 

NextGen Air Transportation System: FAA Has Made Some Progress in 
Midterm Implementation, but Ongoing Challenges Limit Expected 
Benefits. [hyperlink, http://www.gao.gov/products/GAO-13-264]. 
Washington, D.C.: April 8, 2013. 

Next Generation Air Transportation System: FAA Faces Implementation 
Challenges. [hyperlink, http://www.gao.gov/products/GAO-12-1011T]. 
Washington, D.C.: September 12, 2012. 

Next Generation Air Transportation System: FAA Has Made Some Progress 
in Implementation, but Delays Threaten to Impact Costs and Benefits. 
[hyperlink, http://www.gao.gov/products/GAO-12-141T]. Washington, 
D.C.: October 5, 2011. 

Next Generation Air Transportation System: Challenges with Partner 
Agency and FAA Coordination Continue, and Efforts to Integrate Near-, 
Mid-, and Long-term Activities Are Ongoing. [hyperlink, 
http://www.gao.gov/products/GAO-10-649T]. Washington, D.C.: April 21, 
2010. 

Next Generation Air Transportation System: FAA Faces Challenges in 
Responding to Task Force Recommendations. [hyperlink, 
http://www.gao.gov/products/GAO-10-188T]. Washington, D.C.: October 
28, 2009. 

Next Generation Air Transportation System: Progress and Challenges 
Associated with the Transformation of the National Airspace System. 
[hyperlink, http://www.gao.gov/products/GAO-07-25]. Washington, D.C.: 
November 13, 2006. 

5. FAAC Recommendation--Review Criteria for the Airport Improvement 
Program and Passenger Facility Charge Program Related to NextGen: 

Issue Overview: 

The Airport Improvement Program (AIP) and Passenger Facility Charge 
(PFC) Program provide airports with funding for airport development 
and planning projects.[Footnote 35] Under AIP, FAA may provide 
eligible airports with grants,[Footnote 36] using funds drawn from the 
Airport and Airway Trust Fund,[Footnote 37] for projects related to 
planning, development, or noise-compatibility projects. In general, 
airports can use AIP funds on most airfield capital improvements, such 
as new runways or runway lengthening, or repairs and in some specific 
situations, for terminals, hangars, and non-aviation development. 
[Footnote 38] The PFC program allows eligible airports to collect fees 
up to $4.50 for every boarded passenger at commercial airports. 
[Footnote 39] Airports can use this funding for FAA-approved projects 
related to enhancing airport safety, capacity, security, noise 
compatibility, and for enhancing competition among airlines.[Footnote 
40] Project eligibility is almost identical between AIP and the PFC 
program except that airports may use PFC funding for repaying bonds 
and for airline waiting areas and gates that generally are not 
eligible for AIP grants because they are considered revenue producing 
for airlines. 

In its report, the FAAC noted interest among the aviation community in 
broadening AIP and PFC eligibility criteria to support aviation 
infrastructure projects, including those related to NextGen--FAA's 
initiative to transform the nation's ground-based air-traffic control 
system to an air-traffic management system using satellite-based 
navigation and other advanced technology. However, the FAAC noted that 
current regulations do not generally allow AIP or PFC funds to be used 
for NextGen-related projects. 

DOT's and FAA's Actions to Address Recommendation: 

Table 8 provides a summary of the FAAC recommendation to assess AIP 
and PFC eligibility criteria for NextGen projects and FAA's actions to 
address it, as of June 2013. 

Table 8: FAAC Recommendation on Airport Improvement Program (AIP) and 
Passenger Facility Charge (PFC) Eligibility for NextGen Projects and 
DOT's and FAA's Actions to Address It, as of June 2013: 

FAAC recommendation--AIP and PFC: Review the eligibility criteria for 
AIP and PFC programs and consider whether investing AIP and PFC 
dollars in NextGen equipment, operational capabilities, and 
performance-based procedures is needed. If so, FAA should do as much 
as possible to administratively update the eligibility criteria and 
develop legislative recommendations to the Secretary of Transportation 
for the remainder of the suggested changes; 
DOT/FAA actions: Prior to the FAAC recommendation, in September 2010, 
FAA created a working group tasked to review AIP and PFC funding 
eligibility for NextGen systems that would be beneficial to airports 
and also to make recommendations for expanded AIP eligibility through 
legislation or other means. This group identified several airport 
projects that were already being funded with AIP and PFC funds and 
assisted NextGen systems, such as clearing obstructions, which enable 
lower approaches for aircraft using NextGen technologies, and other 
airfield improvements, such as the installation of lighting and 
signs.[A] 
During the course of the working group's review, FAA issued a 2011 
finding that allowed AIP grants to be used for the purchase of 
transponders ("squitters") for airport ground vehicles, such as snow 
plows, airport rescue and firefighting vehicles, and airside 
operations vehicles. Squitters emit a signal from the vehicles, which 
is tracked using NextGen surveillance technology, improving vehicle 
visibility and enhancing airport safety.[B] In fiscal year 2012, three 
airports applied and received grants, totaling $1,265,625, for this 
equipment. The working group also identified other NextGen-related 
projects that would require statutory changes before they could be 
eligible for AIP funding. For example, the group reviewed the use of 
sensors that rely on NextGen surveillance technology for airports 
located in mountainous areas where radars cannot track aircraft.[C] 
FAA officials said while the sensors are a low-cost investment that 
could improve capacity, they determined that funding such an 
investment with AIP would require legislative changes. According to 
FAA officials, the existing AIP authorizing statute does not allow AIP 
funding for surveillance technology that provides airborne aircraft 
tracking data for air traffic control services, such as 
multilateration technologies. In June 2013, DOT's website on the 
status of the FAAC recommendations stated that, for the next FAA 
authorization, FAA is considering recommending a pilot program to 
permit states to fund installation of ADS-B ground stations to provide 
airborne surveillance coverage. 

Source: FAAC report and GAO analysis of DOT and FAA documents and 
interviews. 

[A] Although our discussion with FAA officials focused on the AIP 
program, they noted that projects eligible under AIP would also be 
eligible under PFC. 

[B] One of the programs under NextGen is the use of Automatic 
Dependent Surveillance-Broadcast (ADS-B), which includes a 
surveillance system where an aircraft or other vehicle uses a global 
navigation satellite system to determine and broadcast its position. 
Squitters are one type of ADS-B Out reporting units and can be used in 
the land-based vehicles, allowing them to broadcast their location to 
air traffic control and other suitably equipped vehicles. 

[C] For example, in Colorado, mountainous terrain made installing 
traditional radar too expensive. Because of the lack of radar 
coverage, FAA limits the number of aircraft flying in the area. To 
address this issue, the Colorado Department of Transportation 
installed Wide Area Multilateration (WAM) stations, which rely on 
distributed sensors that would allow Denver's air traffic control 
center to determine an aircraft's position and allow a greater number 
of aircraft to fly in the area. While the Colorado Department of 
Transportation funded the installation of the radars because FAA 
determined that traditional radars were too expensive, FAA funded the 
installation of the sensors with support from FAA's Surveillance 
Broadcast Services office. 

[End of table] 

DOT's and FAA's Planned Actions: 

Although FAA officials told us they consider this recommendation 
addressed, they said that they continue to track other potential 
NextGen-related projects that could be recommended for funding through 
AIP and PFC. As noted in table 8, DOT's June 2013 update on the status 
of this recommendation stated that for the next FAA authorization, FAA 
is considering recommending a pilot program to permit states to fund 
installation of ADS-B ground stations to provide airborne surveillance 
coverage. 

FAAC Members' Assessment of DOT's and FAA's Progress: 

Four of the six FAAC finance subcommittee members felt that the 
recommendation was not fully addressed. Of the two remaining 
subcommittee members, one did not feel that he had enough information 
about DOT's actions on the recommendation to determine whether it was 
fully addressed, while the other said that the recommendation with 
respect to AIP was addressed, but it was unclear what action DOT had 
taken with respect to the PFC program. Two of the subcommittee 
members, including one that did not provide an opinion on the status 
of the recommendation, stated that FAA's approach to the 
recommendation was very narrow and that the FAAC envisioned a broader 
review to determine how to expand the scope of the AIP and PFC 
programs. One of these subcommittee members stated FAA should have had 
additional meetings with airport representatives after the FAAC 
completed its work to explore options for rewriting the AIP and PFC 
program. Another subcommittee member stated that discussions related 
to AIP and PFC should reflect the context of the FAAC's recommendation 
to commission an independent study of federal aviation taxes and fees, 
which we did not examine as part of this report. Two subcommittee 
members noted the need to address funding issues, which are discussed 
in the challenges section. 

Challenges in Implementing this Recommendation: 

* Legislative change. FAA officials told us that the challenge with 
implementing this recommendation is that extending eligibility for AIP 
and PFC funding often requires making changes to the authorizing 
statute. Two subcommittee members acknowledged this issue, but added 
that FAA should work with Congress to explore changing the programs. 
While during the course of our audit, FAA officials stated that they 
did not plan to recommend extending AIP and PFC eligibility to fund 
projects outside of traditional AIP projects because that funding is 
still needed by airports and NextGen has its own funding mechanism; as 
previously noted, DOT's June 2013 update stated that FAA is 
considering recommending legislation for a pilot program to permit 
states to fund installation of ADS-B ground stations--a key NextGen 
technology--which could potentially expand the use of PFC funds. 

* Limited funding. FAA officials and two subcommittee members stated 
that airports are struggling to address their immediate needs with the 
existing AIP and PFC funds, making it difficult to expand use of these 
funds to include NextGen projects. Appropriations for AIP have been 
flat--roughly $3.5 billion for fiscal years 2005 through 2011--and are 
reduced under current authorized levels to be $3.35 billion from 
fiscal year 2012 through fiscal year 2015. In addition, a recent 
statute allowed DOT to transfer funds from AIP to avoid air traffic 
controllers' furloughs and reduce the impacts of other reductions. 
[Footnote 41] With respect to PFC, two subcommittee members noted that 
the PFC has not been increased. (The PFC has remained capped at $4.50 
since 2000.)[Footnote 42] As we have noted, airports have long sought 
to increase the PFC cap, arguing that the fee cap has not been 
adjusted for inflation, while airlines counter that raising the PFC 
inhibits demand for air travel.[Footnote 43] One subcommittee member 
stated that expanding AIP and PFC eligibility to include additional 
costs would require a significant study to determine the most 
appropriate use of the funds. 

Related Products: 

Transportation: Alternative Methods for Collecting Airport Passenger 
Facility Charges. [hyperlink, 
http://www.gao.gov/products/GAO-13-262R]. Washington, D.C.: February 
14, 2013. 

Airport Noise Grants: FAA Needs to Better Ensure Project Eligibility 
and Improve Strategic Goal and Performance Measures. [hyperlink, 
http://www.gao.gov/products/GAO-12-890]. Washington, D.C.: September 
12, 2012. 

Airport Finance: Observations on Planned Airport Development Costs and 
Funding Levels and the Administration's Proposed Changes in the 
Airport Improvement Program. [hyperlink, 
http://www.gao.gov/products/GAO-07-885]. Washington, D.C.: June 29, 
2007. 

6. FAAC Recommendation--Promote Global Competitiveness: 

Issue Overview: 

Ongoing growth in the demand for international air travel presents 
opportunities for expansion for U.S. carriers. However, we previously 
found that U.S. carriers' ability to establish new routes can be 
limited by the policies of foreign governments.[Footnote 44] 
Preferential treatment of national airlines restricts U.S. carriers' 
access to possibly large international markets. Other impediments to 
entry to foreign markets include barriers, such as slot restrictions, 
that limit the potential for service by U.S. carriers.[Footnote 45] 

DOT has taken steps to address restrictive market access policies. In 
1992, DOT launched an initiative to enter into new "Open Skies" 
agreements with foreign countries. Open Skies agreements remove the 
vast majority of restrictions on how airlines of the two signatory 
countries may operate between and beyond their respective territories. 
For example, these agreements remove prohibitions on the routes that 
airlines of the signatory countries can fly or the number of airlines 
that can fly them. Open Skies agreements also provide underlying 
traffic rights and provisions for cooperative marketing arrangements 
that allow airlines from different countries to form alliances with 
one another. Operating in an alliance allows an airline to greatly 
expand its service network, without having to increase the number of 
routes it flies using its own aircraft. U.S. and foreign air carriers 
wishing to enter into an alliance may also request that DOT grant them 
immunity from the U.S. antitrust laws.[Footnote 46] Antitrust immunity 
allows these airlines to coordinate their fares, services, and 
capacity as if they were a single carrier in these markets, subject to 
certain conditions. As part of its antitrust immunity review, DOT 
determines the effects of the immunized alliance on competition and 
whether the alliance serves the public interest. However, there is not 
universal agreement that alliances best serve the traveling public. 
[Footnote 47] 

DOT issued a 1995 Statement of U.S. International Air Transportation 
Policy recognizing the importance of international air service and the 
need to enable U.S. carriers to serve foreign markets. The policy 
provides a broad umbrella under which actions such as bilateral 
negotiations and antitrust immunity alliance reviews are taken and 
emphasized a number of objectives, including, but not limited to: 

* providing carriers with unrestricted opportunities to develop 
services and systems to meet market demand; 

* eliminating market distortions internationally, such as government 
subsidies and unequal access to infrastructure; and, 

* encouraging the development of a cost-effective and productive air-
transportation industry through addressing infrastructure needs, 
privatizing airlines, and reducing barriers to the creation of global 
aviation systems, such as limitations on cross-border investment, 
wherever possible.[Footnote 48] 

The Secretary of Transportation also serves as a member of the 
President's Export Promotion Cabinet.[Footnote 49] This cabinet was 
established through executive order in 2010 and was tasked with 
implementing the National Export Initiative, which seeks to double the 
dollar value of U.S. exports by the end of 2014. 

The FAAC report applauded DOT's efforts to open foreign markets to 
U.S. airlines, but also noted that some of the world's fastest-growing 
aviation markets--including those in Asia, South America, and the Near 
East--remain restricted to U.S. air carriers. In addition, the FAAC 
noted that in some key markets, U.S. passenger and cargo air carriers 
not only face restrictive aviation agreements, but also must confront 
a wide range of practical market access barriers--including slot 
restrictions, airspace limitations, and local ground-handling rules--
that increase their operating costs and limit U.S. air carriers' 
ability to compete, both domestically and globally. In addition, while 
many different factors can be included in DOT's public interest 
analysis of antitrust immunity for alliances, including wages and 
working conditions, some FAAC members expressed concerns on the 
impacts of immunized alliances between U.S. and foreign carriers on 
U.S. workers. 

DOT's and FAA's Actions to Address Recommendation: 

DOT officials told us that their actions on this recommendation 
consisted of a three-prong approach: (1) fostering conditions that 
enable global alliances to develop as well as ensuring DOT gives 
weight to existing statutory criteria when reviewing requests for 
antitrust immunity for alliances between U.S. and foreign carriers; 
(2) continuing efforts to open foreign markets to U.S. carriers; and 
(3) expanding DOT's role in promoting aviation exports. Table 9 
provides a summary of the FAAC recommendation to promote global 
competitiveness and DOT's actions to address it, as of June 2013. 

Table 9: FAAC Recommendation on Promoting Global Competitiveness and 
DOT's and FAA's Actions to Address It, as of June 2013: 

FAAC recommendation--global competitiveness: Foster conditions that 
enable global air carrier alliances that enhance the viability and 
global competitiveness of U.S. air carriers, airports, and 
manufacturers, and protect and create U.S. aviation industry jobs by 
reaffirming the general objectives of the Department of 
Transportation's 1995 Statement of U.S. International Air 
Transportation Policy (the 1995 Statement)[A]; 
DOT/FAA actions: DOT officials noted that, because the 1995 statement 
remains applicable today, it was not necessary to reaffirm it. DOT 
officials added that they worked to foster conditions that enable 
global alliances by working with foreign regulatory authorities to 
discuss industry trends or specific transactions, such as an 
application for antitrust immunity. DOT officials noted that they meet 
periodically with other regulators to share information on cases and 
cooperate on alliance monitoring efforts. DOT also stated that they 
had established a dialogue with stakeholders to facilitate the 
exchange of information on any impediments to the implementation of 
alliances around the world. 

FAAC recommendation--global competitiveness: Ensure that, as the DOT 
performs its public interest analysis, it gives substantial weight to 
existing statutory criteria that would help ensure an economically 
healthy and globally competitive U.S. air carrier industry and 
prosperous workforce, including: 
* Strengthening the competitive position of air carriers to at least 
ensure equality with foreign air carriers, including the attainment of 
the opportunity for air carriers to maintain and increase their 
profitability in foreign air transportation; 
* Placing maximum reliance on competitive market forces and on actual 
and potential competition…to provide the needed air transportation 
system [and] encourage efficient and well-managed air carriers to earn 
adequate profits and attract capital; 
* Promoting, encouraging and developing civil aeronautics and a 
viable, privately owned United States air transport industry; 
* Encouraging fair wages and working conditions[B]; 
DOT/FAA actions: According to DOT officials, DOT reviewed its process 
for conducting a public interest analysis of alliance applications and 
has conducted outreach to get the perspectives of airlines and labor 
stakeholders during DOT's review of specific industry actions. For 
example, DOT officials stated they conducted outreach to pilot unions, 
and subsequently and separately, pilot unions participated in 
proceedings concerning antitrust immunity (e.g., the pilot union for 
Delta Air Lines filed comments in support of Delta's alliance with 
Virgin Australia.) DOT officials stated that this outreach helped the 
department better communicate its approach to these reviews. DOT 
officials stated that they continue to focus on the statutory goals 
when conducting the public interest analysis. They also noted that 
their review of alliances is not formulaic and that when issuing an 
order on a specific alliance, DOT explains the public interest 
analysis it conducted during the review. 

FAAC recommendation--global competitiveness: Build upon and expand the 
DOT's Open Skies initiative, focusing on: (1) the largest and fastest-
growing international markets that remain constrained by restrictive 
bilateral aviation agreements; (2) ensuring de facto market access and 
a level playing field for U.S. passenger and cargo air carriers facing 
impediments to doing business abroad; and (3) promoting employment 
opportunities for U.S. air carrier workers; 
DOT/FAA actions: Since the issuance of the FAAC report, DOT reached 
new Open Skies agreements with additional countries, including those 
with Sierra Leone and Macedonia. These agreements bring the total 
number of Open Skies partners to 110, as of May 6, 2013. DOT officials 
told us they are continuing their efforts to establish Open Skies 
agreements or significant liberalization agreements with China, 
Mexico, Argentina, South Africa, and Russia. They also said that DOT 
may use its regulatory authority to redress unfair or discriminatory 
practices by foreign governments or entities against U.S. interests. 
For example, on March 15, 2013, DOT issued a "show cause" order 
related to Italian airport fees.[C] DOT officials noted that they 
continually work with foreign governments to address unfair or 
discriminatory practices, but issues rarely rise to the level of 
requiring formal regulatory action by DOT. 

FAAC recommendation--global competitiveness: Leverage the Secretary of 
Transportation's appointment to the President's Export Promotion 
Cabinet, and support an expansion of the DOT's role in promoting 
aviation exports for U.S. air carriers, manufacturers, and airports, 
and facilitating international tourism; 
DOT/FAA actions: The Secretary serves on the President's Export 
Promotion Cabinet, and DOT is also part of a working group for the 
National Export Initiative. This initiative was established in 2010 to 
support trade promotion, is led by the Secretary of Commerce, and 
includes representatives from the United States Trade Representative, 
Department of State, and the U.S. Trade and Development Agency. The 
initiative includes an emphasis on addressing aerospace market access 
and infrastructure issues, seeking to establish Open Skies agreements 
and eliminate restrictive aviation practices worldwide. Removal of 
such restrictions could allow U.S. airlines to more fully participate 
in the transport of U.S. exports overseas. 

Source: FAAC report and GAO analysis of DOT documents and interviews. 

[A] See, Statement of United States International Air Transportation 
Policy, 60 Fed. Reg. 21,841 (May 3, 1995). The FAAC subcommittee was 
unable to reach consensus supporting the 1995 Policy Statement's 
objective of reducing existing limitations on cross-border investments. 

[B] 49 U.S.C. § 40101(a). 

[C] Specifically, DOT reached the tentative conclusion that Italian 
airport authorities charge air carriers operating flights to and from 
points outside the European Union a different, higher, set of fees 
than carriers operating flights within the European Union. DOT stated 
that this imposed an unjustifiable or unreasonable restriction on 
access of U.S. air carriers to the Italy market and violated the U.S.-
EU Air Transport Agreement. If DOT finalizes the order, it will impose 
operational restrictions on the Italian carrier, Alitalia, forbidding 
it to engage in air service between Italy and the United States. 

[End of table] 

DOT's and FAA's Planned Actions: 

DOT officials noted that they are working to ingrain these 
recommendations into their existing efforts and processes. They stated 
that DOT continues to pursue Open Skies agreements with China, Mexico, 
Argentina, South Africa, and Russia, but given the nature of 
negotiating such agreements, there is no timetable for concluding 
these discussions. DOT is also considering a "best practices" template 
outlining how to implement Open Skies provisions in other countries 
but has not set a timeframe for finalizing this template. 

FAAC Members' Assessment of DOT's and FAA's Progress: 

Of the nine FAAC competitiveness subcommittee members, two members 
felt that the recommendation was addressed; six members felt that the 
recommendation was not fully addressed, and one did not express an 
opinion. The members who did not feel the recommendation was addressed 
cited the ongoing nature of competitiveness issues and, in some cases, 
simply suggested DOT continue its current efforts. However, in other 
cases, members suggested DOT take additional actions to address the 
recommendation, for example: 

* Three subcommittee members stated additional action should be taken 
with respect to DOT's work with the Departments of State, Homeland 
Security, and Commerce on the National Export Cabinet. Two members 
stated that the agencies should work to make it easier for tourists 
and business travelers to obtain visas, and another member noted the 
need to ensure U.S. carriers receive the same opportunities overseas 
that foreign carriers receive in the U.S. market. 

* Three members stated that DOT should take a more aggressive approach 
when addressing anti-competitive practices by other countries and 
supporting the U.S. aviation industry. One subcommittee member stated 
that DOT needs to refocus on its statutory mandate to strengthen the 
competitive position of air carriers to at least ensure equality with 
foreign air carriers; and that the federal government should pursue a 
national airline policy to follow through on this and other FAAC 
recommendations. Another member noted that concerns remain with 
respect to equal access to airport slots during popular travel times 
while the third member said that DOT should push harder to get an 
agreement in place with China. 

In addition, two subcommittee members, including one that felt the 
recommendation was addressed, emphasized the need for DOT to consider 
the labor impacts of Open Skies agreements and the resulting alliances 
between U.S. and foreign carriers.[Footnote 50] Another member noted 
the need to consider the safety impacts. These members noted a lack of 
consensus during the FAAC discussions regarding how DOT should address 
these issues; as a result, these issues are not included in the FAAC 
recommendation but were discussed in the FAAC report as "other areas 
of significant discussion."[Footnote 51] 

Challenges in Implementing the Recommendation: 

* Obtaining consensus from many stakeholders, including foreign 
governments. DOT officials and four FAAC subcommittee members noted 
challenges in negotiating Open Skies agreements with other countries--
a process that can take many years and ultimately depends on securing 
the agreement of another nation. Two subcommittee members also noted 
that addressing competitiveness issues involves input from a number of 
other stakeholders with conflicting viewpoints, including airlines, 
airports, labor, other government agencies, and elected officials. As 
previously noted, DOT officials stated that they had established a 
dialogue with stakeholders regarding impediments to the implementation 
of alliances around the world, and conducted outreach to get airlines' 
and labor stakeholders' perspectives on DOT's public interest analysis 
of alliances. 

Related Products: 

Slot-Controlled Airports: FAA's Rules Could be Improved to Enhance 
Competition and Use of Available Capacity. [hyperlink, 
http://www.gao.gov/products/GAO-12-902]. Washington, D.C.: September 
13, 2012. 

Airline Industry: Potential Mergers and Acquisitions Driven by 
Financial and Competitive Pressures. [hyperlink, 
http://www.gao.gov/products/GAO-08-845]. Washington, D.C.: July 31, 
2008. 

U.S. Aerospace Industry: Progress in Implementing Aerospace Commission 
Recommendations, and Remaining Challenges. [hyperlink, 
http://www.gao.gov/products/GAO-06-920]. Washington, D.C.: September 
13, 2006. 

Transatlantic Aviation: Effects of Easing Restrictions on U.S.-
European Markets. [hyperlink, http://www.gao.gov/products/GAO-04-835]. 
Washington, D.C.: July 21, 2004. 

Issues Relating to Foreign Investment and Control of U.S. Airlines. 
[hyperlink, http://www.gao.gov/products/GAO-04-34R]. Washington, D.C.: 
October 30, 2003. 

International Aviation: DOT's Efforts to Promote U.S. Air Cargo 
Carriers' Interests. [hyperlink, 
http://www.gao.gov/products/GAO/RCED-97-13]. Washington, D.C.: October 
18, 1996. 

7. FAAC Recommendation--STEM Education: 

Issue Overview: 

Aviation and aerospace employers, including government transportation 
agencies, airlines, and manufacturers, are facing a number of 
workforce challenges, such as an aging workforce, a lack of needed 
skills in the current and future workforce, and the need to adapt to 
rapidly evolving technology and compete in a global marketplace. A 
number of organizations, including the FAAC, have noted that 
addressing these challenges will require a focus on science, 
technology, engineering, and mathematics (STEM) education. The 
challenges faced by aviation and aerospace employers reflect a larger 
national trend, as research has shown that the United States lacks a 
strong pipeline of future workers in STEM fields and that U.S. 
students continue to lag behind students in other highly technological 
nations in mathematics and science achievement. 

For over three decades, Congress and the executive branch have 
continued to create new STEM education programs, even though, as we 
found in 2005, there has been a general lack of assessment of how well 
STEM programs were working.[Footnote 52] In January 2012, we reported 
that thirteen agencies administered 209 STEM education programs in 
fiscal year 2010 and spent over $3 billion to prepare students and 
teachers for careers in STEM fields.[Footnote 53] We noted that the 
lack of a government-wide strategic plan hampered the effectiveness of 
the federal effort, and made a number of recommendations related to 
the larger federal effort on STEM, which is described in more detail 
in the next paragraph.[Footnote 54] Last year, the Office of 
Management and Budget established a cross-agency priority goal to 
improve the quality of STEM education at all levels.[Footnote 55] In 
May 2012, we reported that by naming STEM education as a cross-agency 
goal, the administration is taking the first step towards creating a 
government-wide plan to achieve its goal. However, we also stated that 
a number of limitations could hamper progress, such as overlapping 
STEM programs; agencies that did not connect STEM education activities 
to agency goals in their annual performance plans or measure the 
progress of their STEM activities; and a lack of information about the 
effectiveness of STEM programs. We reiterated our prior 
recommendations.[Footnote 56] 

In addition, the America COMPETES Reauthorization Act of 2010 called 
for the Office of Science and Technology Policy's (OSTP) National 
Science and Technology Council (NSTC) to establish a committee to 
inventory, review, and coordinate federal STEM education programs. 
[Footnote 57] The Committee on Science, Technology, Engineering, and 
Math Education (CoSTEM) is comprised of representatives from eleven 
agencies, including DOT.[Footnote 58] In December 2011, CoSTEM 
published an inventory of the federal STEM education portfolio. In May 
2013, CoSTEM released a 5-year strategic federal STEM education plan. 
DOT officials told us that DOT's Research and Innovative Technology 
Administration (RITA) represents DOT on the CoSTEM effort, and 
participated in the development of an inventory of federal STEM 
programs and the development of the Federal STEM education plan. The 
bulk of DOT's and FAA's activities that are related to STEM education 
are conducted through FAA's Aviation and Space Education (STEM-AVSED) 
outreach program. STEM-AVSED's goals include encouraging students to 
explore aviation and aerospace career opportunities; promoting the 
skills and knowledge critical to aviation safety; and increasing 
awareness and understanding of the agency's role in aviation and 
aerospace.[Footnote 59] 

DOT's and FAA's Actions to Address Recommendation: 

DOT and FAA officials have taken steps to address the wide-ranging 
actions identified in the recommendation by improving internal 
coordination, collaborating with external stakeholders, and conducting 
STEM outreach to educational institutions and students through a 
variety of programs. Table 10 provides a summary of the FAAC 
recommendation on STEM outreach and DOT's and FAA's actions to address 
it, as of June 2013. 

Table 10: FAAC Recommendation on STEM Outreach and DOT's and FAA's 
Actions to Address It, as of June 2013: 

FAAC recommendation--STEM: Ensure coordination and focus within DOT on 
workforce development of STEM as a centralized and focused top-tier 
initiative of the DOT; 
DOT/FAA actions: According to FAA officials, FAA established a STEM 
Council that meets monthly to coordinate STEM activities across FAA's 
business lines. DOT officials stated that it has an internal group 
that meets 8 to 12 times per year to discuss workforce development, 
including retraining and succession planning, and that STEM issues are 
frequently discussed during these meetings. 

FAAC recommendation--STEM: Assign the Assistant Secretary for 
Administration the task of developing, overseeing, coordinating, 
implementing, and integrating a strategic workforce development plan 
that includes STEM education programs and activities for the current 
and future workforce; 
DOT/FAA actions: DOT has not developed a strategic workforce 
development plan that includes STEM education. DOT officials stated 
that DOT's next strategic plan, scheduled to be released in 2015, may 
include some STEM components. 

FAAC recommendation--STEM: Create an advisory council comprised of 
outside experts, focused on aviation and aerospace, who can provide 
expertise to help identify, align, and coordinate efforts on workforce 
development and STEM education within the DOT; 
DOT/FAA actions: DOT has not created an advisory council of external 
aviation and aerospace experts because, according to DOT officials, 
STEM education is not part of DOT's mission, making it difficult to 
establish a STEM council under the Federal Advisory Committee Act. DOT 
officials noted that DOT and FAA partner with outside stakeholders on 
workforce development and STEM issues through a number of programs, 
such as the University Transportation Centers Program[A]. 

FAAC recommendation--STEM: Increase education outreach from pre-
kindergarten to institutions of higher education; 
DOT/FAA actions: FAA officials noted that they continued their 
outreach to educational institutions through the Aviation and Space 
Education (STEM-AVSED) program. FAA updated its STEM-AVSED website, 
which is designed to appeal to an audience unfamiliar with aviation, 
such as students and teachers. FAA officials stated they plan to 
augment the existing STEM-AVSED efforts to target middle and high 
school students with additional programs for elementary students. FAA 
also developed and distributed a brochure on aviation engineering 
careers. FAA worked with the National Aeronautics and Space 
Administration to develop an educational program called Smart Skies 
that uses an air traffic control simulator to teach algebra. According 
to FAA, this program has been rolled out to hundreds of schools; 
FAA worked with DOT to develop the Real World Design Challenge, which 
is a free engineering competition, and FAA and the Federal Highway 
Administration are collaborating to combine two youth summer programs: 
the Aviation Career Education (ACE) Academy[B] and the National 
Transportation Summer Institute.c FAA and its partners developed Ask 
Polaris, a website designed to help graduating high school students 
learn more about the field of aerospace engineering, including the 
types of college degrees available. DOT also established a Youth 
Employee STEM Mentoring Program, through which DOT mentors work 2 
hours per week assisting students with these subjects. 

FAAC recommendation--STEM: Consider improving programs and connections 
with 2-and 4-year educational institutions that give students hands-on 
experience applicable to the aviation and aerospace workplace; 
DOT/FAA actions: FAA officials stated they improved lines of 
communication with the Centers of Excellence, which award aerospace 
research grants to colleges. Also, FAA has an MOU to increase the 
visibility of technical careers in aviation and aerospace with the 
National Coalition of Certification Centers (NC3), a network of 
schools and industry leaders that develop aviation certifications. As 
part of this effort, FAA and NC3 developed a brochure on aviation 
careers for college recruiters to share with high school counselors, 
embarked on a national poster campaign--Yes I Can Do That, and 
implemented a job shadowing program called Walk in Your Boots. 

FAAC recommendation--STEM: Establish an award for innovation to 
recognize persons, businesses, or organizations that develop unique 
scientific and engineering innovations in aerospace and aviation; 
DOT/FAA actions: DOT established the Secretary's Recognizing Aviation 
and Aerospace Innovation in Science and Engineering (RAISE) award to 
recognize innovative scientific and engineering achievements that will 
have a significant impact on the future of aerospace or aviation. The 
award is open to students at the high school, undergraduate, and 
graduate levels. DOT awarded its first RAISE award in October 2012. 

FAAC recommendation--STEM: Work with the Secretary of Labor as an 
integral part of the Interagency Aerospace Revitalization Task Force, 
originally established in 2006, to implement a national strategy 
focused on recruiting, training, and cultivating the aerospace 
workforce. Work with the Department of Education to provide resources 
that would create state-of-the-art STEM elementary and secondary 
educational facilities; 
DOT/FAA actions: DOT officials noted that while the Interagency 
Aerospace Revitalization Task Force was disbanded, DOT has held 
semiannual Aviation Industry Workforce-Management Conferences with the 
Departments of Labor and Education. In addition, in September 2011, 
the Secretaries of Transportation, Education, and Labor signed a 
memorandum of understanding to collaborate on implementing strategies 
for using STEM education to develop a qualified aerospace workforce. 
DOT officials stated that the agencies developed an informal work 
plan, and have coordinated on efforts to provide information on 
transportation careers for the Department of Labor's American Job 
Centers. In addition, as previously mentioned, RITA represents DOT on 
a federal agency-wide effort to coordinate STEM programs through the 
Committee on Science, Technology, Engineering, and Math Education. 

Source: FAAC report and GAO analysis of DOT and FAA documents and 
interviews. 

[A] RITA's University Transportation Centers program provides grants 
for universities to operate centers that: advance U.S. technology and 
expertise in transportation through research, education, workforce 
development, and technology transfer; provide a critical 
transportation knowledge base outside the US DOT; and address vital 
workforce needs for the next generation of transportation leaders. 

[B] ACE Academies are interactive aviation summer camps geared towards 
middle and high school students who are interested in aviation and 
aerospace. 

[C] The National Transportation Summer Institute program is designed 
to introduce secondary school students to all modes of transportation 
careers and encourage them to pursue transportation-related courses of 
study at the college and university level. 

[End of table] 

DOT's and FAA's Planned Actions: 

DOT officials stated that the spirit and intent of the recommendation 
have been addressed, but added that work will continue as education is 
an evolving process with new audiences to reach. DOT and FAA officials 
stated they will continue efforts to coordinate programs, partner with 
stakeholders, and leverage resources. FAA officials noted that it is 
important that the agency continue to keep a spotlight on STEM 
education. To maintain that focus, officials stated that the agency 
could include FAA's STEM work into FAA's Business Plan Goals. FAA 
officials stated they would like to eventually augment the existing 
STEM-AVSED efforts to target middle and high school students with 
additional programs for elementary students but have not established 
time frames to do so. DOT officials noted that they are working to 
determine how to attract students through STEM programs, as well as 
attracting students more interested in technical training. 

FAAC Members' Assessment of DOT's and FAA's Progress: 

Five of the seven FAAC labor and workforce subcommittee members stated 
that DOT and FAA had addressed the recommendation, but all of the 
members stated that the DOT's and FAA's work on this issue should 
continue. Four of the subcommittee members praised DOT efforts such as 
establishing the RAISE award or the Aviation Industry Workforce-
Management Conferences. Two of the subcommittee members--one that 
thought the recommendation was addressed and one that did not--stated 
that DOT and FAA should conduct outreach outside of Washington, D.C., 
on workforce and STEM issues and made diverse suggestions, including 
involving FAA regional offices, hosting regional workforce summits, 
providing a regional RAISE award, and interacting with students in 
university and high school settings. One of the FAAC members who did 
not think the recommendation was addressed stated that DOT should 
provide more detail on what they are doing, and how they are measuring 
their performance. 

Challenges in Implementing the Recommendation: 

* Coordinating with larger federal efforts to avoid duplication and 
leverage resources. We have previously reviewed STEM programs across 
the federal government and raised concerns about the patchwork of 
fragmented and overlapping federal STEM programs, noting that poor 
coordination among the many agencies that oversee these programs and 
the lack of a government-wide strategic plan have hampered the 
effectiveness of the federal effort.[Footnote 60] Six of the seven 
FAAC subcommittee members we interviewed recognized that STEM 
education is a broad policy issue, and efforts on this recommendation 
require collaborating with and maintaining the participation of 
outside groups, such as other agencies, industry, and other 
stakeholders. The administration is also taking steps to address these 
issues through establishing a cross-agency priority goal and creating 
a 5-year strategic plan for STEM education. As previously noted, RITA 
has participated in the government-wide effort to coordinate STEM 
programs. 

* Sustaining long-term efforts. DOT and FAA officials and a FAAC 
subcommittee member noted that education is an evolving, ongoing 
effort, which can be difficult to sustain interest and support for 
over the long term. They added that funding and limited resources pose 
challenges to maintaining these efforts, but the agencies work to 
leverage resources through the partnerships previously noted. 

* Attracting students to aviation careers. FAA officials stated that 
attracting students to technical careers can be challenging given 
misconceptions about aviation maintenance careers. Five of the FAAC 
subcommittee members also noted the challenges in enticing students 
into the STEM fields or related aviation careers, and three of the 
members stated that a viable and sustainable aviation industry would 
help address this challenge. FAA officials also noted challenges in 
developing web content that appealed to students and educators while 
staying within FAA's branding guidelines, which are typically geared 
toward FAA's traditional audience of aviation professionals. However, 
FAA officials stated they were working across departments within FAA 
to address these issues. 

Related Products: 

Science, Technology, Engineering, and Mathematics Education: 
Governmentwide Strategy Needed to Better Manage Overlapping Programs. 
[hyperlink, http://www.gao.gov/products/GAO-13-529T]. Washington, 
D.C.: April 10, 2013. 

Aviation Safety: Additional FAA Efforts Could Enhance Safety Risk 
Management. [hyperlink, http://www.gao.gov/products/GAO-12-898]. 
Washington, D.C.: September 12, 2012. 

Managing for Results: GAO's Work Related to the Interim Crosscutting 
Priority Goals under the GPRA Modernization Act. [hyperlink, 
http://www.gao.gov/products/GAO-12-620R]. Washington, D.C.: May 31, 
2012. 

2012 Annual Report Opportunities to Reduce Duplication, Overlap and 
Fragmentation, Achieve Savings, and Enhance Revenue. [hyperlink, 
http://www.gao.gov/products/GAO-12-342SP]. Washington, D.C.: February 
28, 2012. 

Science, Technology, Engineering, and Mathematics Education: Strategic 
Planning Needed to Better Manage Overlapping Programs across Multiple 
Agencies. [hyperlink, http://www.gao.gov/products/GAO-12-108]. 
Washington, D.C.: January 20, 2012. 

Federal Aviation Administration: Agency Is Taking Steps to Plan for 
and Train Its Technician Workforce, but a More Strategic Approach Is 
Warranted. [hyperlink, http://www.gao.gov/products/GAO-11-91]. 
Washington, D.C.: October 22, 2010. 

8. FAAC Recommendation--Legal Protections for Safety Data: 

Issue Overview: 

For decades, FAA and the aviation industry have used data to identify 
the causes of aviation accidents and incidents and take actions to 
prevent their recurrence. Our prior work has shown that FAA is in the 
midst of a shift toward a proactive, data-driven safety oversight 
approach, commonly referred to as a safety management system (SMS) 
approach.[Footnote 61] Under this new approach, FAA plans to use 
aviation safety data to identify system-wide trends in aviation safety 
and manage emerging hazards before they result in incidents or 
accidents. 

In addition to mandatory reporting systems and inspection programs 
that collect information on safety issues and events, FAA has 
developed a number of voluntary reporting systems that air carrier and 
industry personnel can use to report safety issues and events. 
[Footnote 62] For example, FAA's Aviation Safety Action Program (ASAP) 
allows air carrier employees to voluntarily report safety issues and 
events and provides protection from enforcement action by FAA and 
disciplinary action by airline management or others. To improve FAA's 
capability for automated analysis of multiple databases, FAA has 
partnered with industry through the Aviation Safety Information 
Analysis and Sharing (ASIAS) program. According to FAA documents, 
ASIAS leverages data from multiple sources, including FAA data sets, 
airline proprietary safety data, publicly available data, and 
manufacturer data, allowing FAA to (1) perform integrated queries 
across multiple databases, (2) search an extensive warehouse of safety 
data, and (3) display pertinent elements in an array of useful 
formats. The ASIAS home page shows that as of February 2013, 44 
airlines were participating in ASIAS, including 13 of the 14 airlines 
with at least 1 percent of total domestic scheduled passenger service 
revenue. FAA is also in two rulemaking processes to require SMS--which 
will include the development of systems for reporting, tracking, and 
analyzing safety data--for air carriers and airports. 

Our prior work has shown that the success of a SMS program depends 
upon the open sharing of safety information among aviation 
stakeholders; however, FAA officials have recognized that aviation 
industry concerns about data protection and legal liability could 
hinder the implementation of SMS.[Footnote 63] The FAAC stated that 
the development, analysis, and availability of shared safety 
information could be inhibited by the potential that this information 
may be used for other purposes, such as exposure through the media, 
admissions in criminal or administrative prosecution, or use in civil 
litigation. 

DOT's and FAA's Actions to Address Recommendation: 

Table 11 provides a summary of the FAAC recommendation to ensure 
safety data protections and DOT's and FAA's actions to address it, as 
of June 2013. 

Table 11: FAAC Recommendation on Safety Data Protections and DOT's and 
FAA's Actions to Address It, as of June 2013: 

FAAC recommendation--data protection: Seek comprehensive legal 
protection for participants in voluntary and mandated safety 
management system (SMS) data programs to ensure the programs' 
continued benefits to safety, pursue essential legislative action that 
is vital to provide ongoing protection of safety information-sharing 
systems in the United States, and work with Congress to introduce such 
legislation at the earliest possible opportunity; 
DOT/FAA actions: Since the FAAC report was issued, Congress passed the 
FAA Modernization and Reform Act.[A] This Act prohibits the public 
disclosure by FAA of data and information submitted voluntarily to FAA 
and developed under the following programs: Aviation Safety Action 
Program; Flight Operational Quality Assurance Program; and Line 
Operations Safety Audit Program, as well as reports, data or other 
information produced or collected for purposes of developing and 
implementing a SMS program, and reports based thereon, including 
reports under the Aviation Safety Information Analysis and Sharing 
(ASIAS) Program. FAA officials stated they provided technical 
assistance to Congress on this issue. FAA officials also noted that 
FAA is involved in an ICAO task force that is developing standards and 
recommended practices related to safety data including guidance for 
judiciary bodies on the issue of protecting safety data during 
litigation. 

Source: FAAC report and GAO analysis of DOT and FAA documents and 
interviews. 

[A] Pub. L. No. 112-95, § 310, 126 Stat. 11. 

[End of table] 

DOT's and FAA's Planned Actions: 

FAA officials consider this recommendation addressed. More 
specifically, while the FAA Modernization and Reform Act did not 
prohibit the disclosure of data in civil or criminal litigation, or 
provide protections if data are submitted through mandatory programs, 
FAA officials consider the law to address the intent of this 
recommendation. As previously noted, FAA is in the midst of a 
rulemaking process to require SMS for air carriers, and FAA officials 
acknowledged that there are remaining concerns among industry 
stakeholders regarding the extent to which data collected under 
mandatory SMS programs would be protected.[Footnote 64] FAA officials 
stated they plan to address this issue in the publication of a final 
rule on SMS implementation by air carriers, which is expected to be 
completed in October 2013. FAA officials also stated they will 
continue to encourage the voluntary reporting of data into ASIAS. 

FAAC Members' Assessment of DOT's and FAA's Progress: 

The evolving nature of aviation safety and remaining concerns 
regarding the potential disclosure of data led to varying opinions on 
the extent to which the recommendation was addressed. Two subcommittee 
members said it was addressed, with one citing the provisions 
protecting safety data from disclosure in the FAA Modernization and 
Reform Act, and another noting the work is ongoing. Four of the seven 
FAAC safety subcommittee members did not believe that the 
recommendation was addressed, but three of them noted that work was 
ongoing or that safety was an evolving issue. One subcommittee member 
stated he did not have enough information to comment on the status of 
this recommendation. Three subcommittee members expressed concern on 
the potential disclosure of data during criminal and civil litigation 
while another member expressed concern on protecting data that is 
mandated to be submitted--neither of which is addressed by current law 
but were included in the FAAC recommendation. One member noted that 
FAA needs to better communicate to Congress how the lack of 
protections could have serious ramifications on voluntary reporting of 
safety data. Two subcommittee members suggested additional areas of 
focus beyond the recommendation, including collecting data on the 
amount of time pilots spend flying to the city where they begin their 
work day--an issue discussed in the aftermath of the 2009 Colgan 
accident--and the need for international harmonization on the 
definition of legal protections for safety data. 

Challenges in Implementing the Recommendation: 

* Addressing remaining data protection concerns. FAA officials as well 
as two FAAC subcommittee members acknowledged industry concern with 
respect to protecting safety data during criminal and civil litigation 
and recognized its potential impact on SMS implementation. However, 
they noted that it will be difficult to determine the extent to which 
this issue could affect SMS and data sharing until it is tested in 
court. Four of the subcommittee members stated that the potential for 
disclosure could also affect operators' or their employees' 
willingness to voluntarily report safety issues. 

While protection of airport safety data was not specifically discussed 
as part of the FAAC's recommendation, we reported in September 2012 
that these data are subject to state-specific FOIA laws, which could 
make air carriers less willing to share safety information with 
airports.[Footnote 65] Specifically, while air carriers are not 
directly subject to state FOIA laws because they are privately owned, 
data that airports collect and submit to FAA for SMS--such as 
information on hazards or other safety data--may be subject to public 
disclosure under state FOIA laws. FAA officials and experts stated 
that state FOIA laws could affect the willingness of air carriers to 
share safety data with airports because any data they choose to share 
with airports could then be subject to these laws. We recommended that 
the FAA Administrator consider strategies to address airports' 
concerns, including asking Congress to provide additional protection 
for SMS data collected by public entities. Officials stated that FAA 
is working to address this recommendation. 

Related Products: 

Aviation Safety: FAA Efforts Have Improved Safety but Challenges 
Remain in Key Areas. [hyperlink, 
http://www.gao.gov/products/GAO-13-442T]. Washington, D.C.: April 16, 
2013. 

Aviation Safety: Additional FAA Efforts Could Enhance Safety Risk 
Management. [hyperlink, http://www.gao.gov/products/GAO-12-898]. 
Washington, D.C.: September 12, 2012. 

Aviation Safety: FAA Is Taking Steps to Improve Data, but Challenges 
for Managing Safety Risks Remain. [hyperlink, 
http://www.gao.gov/products/GAO-12-660T]. Washington, D.C.: April 25, 
2012. 

Aviation Safety: Improved Data Quality and Analysis Capabilities Are 
Needed as FAA Plans a Risk-Based Approach to Safety Oversight. 
[hyperlink, http://www.gao.gov/products/GAO-10-414]. Washington, D.C.: 
May 6, 2010. 

9. FAAC Recommendation--Predictive Analytic Capabilities for Safety 
Data and Information: 

Issue Overview: 

As previously noted, FAA is in the midst of a shift toward a 
proactive, data-driven safety oversight approach, commonly referred to 
as a safety management system (SMS) approach. Under this new approach, 
FAA plans to use aviation safety data to identify system-wide trends 
in aviation safety and manage emerging hazards before they result in 
incidents or accidents. The FAAC noted that to develop the robust 
predictive risk-discovery capabilities needed for SMS, FAA must 
develop advanced analytical tools and methods, as well as modeling and 
simulation capabilities. According to FAA, the Aviation Safety 
Information Analysis and Sharing (ASIAS) program--a joint industry and 
FAA effort that serves as a central exchange of safety information--is 
a cornerstone of its effort to implement SMS. According to FAA 
documents, ASIAS leverages data from multiple sources--including FAA 
data sets, airline proprietary safety data, publicly available data, 
and manufacturer data--allowing FAA to (1) perform integrated queries 
across multiple databases, (2) search an extensive warehouse of safety 
data, and (3) display pertinent elements in an array of useful 
formats. The ASIAS home page shows that as of February 2013, 44 
airlines were participating in ASIAS. 

According to the FAAC, the initial results of ASIAS analyses have 
demonstrated the value of using safety information to produce a system 
safety baseline. However, the FAAC noted that realization of 
predictive safety risk-discovery requires investment in expanding, 
accelerating, and maturing ASIAS capabilities. 

DOT's and FAA's Actions to Address Recommendation: 

Table 12 provides a summary of the FAAC recommendation on developing 
predictive safety risk analysis capabilities and FAA's actions to 
address it, as of June 2013. 

Table 12: FAAC Recommendation on Predictive Analytic Capabilities for 
Safety Data and Information and DOT's and FAA's Actions to Address It, 
as of June 2013: 

FAAC recommendation--predictive capabilities: Provide focus, priority, 
and resources to develop improved tools and methods that will result 
in robust predictive analytic capabilities for safety data and 
information; 
DOT/FAA actions: Consistent with the FAAC's recommendation, FAA has 
pursued action to expand and support Aviation Safety Information 
Analysis and Sharing (ASIAS). In 2011, the ASIAS program received FAA 
approval for $15 million per year[A] for 5 years (fiscal years 2013 
through 2017) to collect additional data and further develop its 
analytical capabilities in support of a more proactive safety 
management approach. For example, according to FAA, there are efforts 
under way to add air-traffic-control voice data and general aviation 
data to ASIAS, which currently includes airline-collected data, data 
from the voluntary Flight Operational Quality Assurance (FOQA) 
program, pilot-provided data, weather data, air traffic control-
generated data, and radar-tracking data. FAA is also working with 
three airlines to demonstrate the modeling capabilities of ASIAS if 
more airline-provided data were combined with FAA data sources. 
According to its current plan, by 2017, FAA would like to deploy 
modeling capabilities that cover all phases of flight and to have 
developed and refined risk models that incorporate the risk factors 
developed through the identification and validation of safety issues, 
accident precursors, and other vulnerabilities. 

Source: FAAC report and GAO analysis of DOT and FAA documents and 
interviews. 

[A] Though ASIAS received approval for these funds, funds must still 
be appropriated for ASIAS on an annual basis. 

[End of table] 

DOT's and FAA's Planned Actions: 

By securing the funds for execution, FAA believes that it has 
fulfilled the spirit of the recommendation and is positioned to 
deliver predictive safety risk-discovery capabilities. Officials told 
us that FAA intends to continue executing its 5-year ASIAS Plan. 

FAAC Members' Assessment of DOT's and FAA's Progress: 

While six of the FAAC safety subcommittee members who provided an 
opinion stated that FAA's efforts to address this recommendation would 
be ongoing, members varied in their opinion as to whether the 
recommendation was fully addressed. One subcommittee member stated he 
did not have enough information to comment on the status of this 
recommendation. Two subcommittee members stated it was fully addressed 
because FAA has secured the resources currently needed for ASIAS, but 
noted that the nature of the recommendation meant the work and support 
would need to be ongoing. Four members did not feel the recommendation 
was fully addressed, and three noted this was due to the ongoing 
nature of the recommendation, but stated that they were satisfied with 
FAA's actions.[Footnote 66] For example, one subcommittee member said 
that developing predictive safety risk-discovery capabilities requires 
constantly refining and making the capabilities more sophisticated. 

Challenges in Implementing the Recommendation: 

* Data protection. FAA officials and FAAC members noted that 
addressing the FAAC's other safety data-related recommendations--that 
is, to expand its collection of voluntary safety data sources and to 
legally protect that information--will affect the development of 
predictive capabilities.[Footnote 67] Two subcommittee members stated 
FAA should highlight the benefits of data-sharing systems, such as 
improved safety outcomes, to encourage more participation in such 
programs. Three FAAC subcommittee members noted the need to address 
legal concerns regarding data protection. 

* Data quality. According to FAA, simply collecting the data is not 
enough; once collected, the data need to be of reliable quality and 
share a common lexicon and format across contributors.[Footnote 68] 
For example, FAA's ASIAS plan explains that since ASIAS pulls data 
from a number of sources, it is important to ensure that a data 
element from one source represents the same issue as a data element 
from another source. One FAAC subcommittee member noted that FAA will 
need to address this issue in order to develop methods to 
automatically mine the data (i.e., use computer programs to identify 
patterns and trends in the data), since having a systematic method to 
analyze the data would further enable FAA's ability to use ASIAS data 
to proactively identify risks. According to its ASIAS Plan, FAA will 
address and monitor these issues regularly as new data sources are 
added. It plans to develop taxonomies to better merge data from 
programs like ASAP, the Air Traffic Safety Action Program, and FOQA in 
2013 and 2014. 

* Resource constraints. Three FAAC subcommittee members raised 
concerns about how budget issues would affect FAA's efforts to 
implement the recommendation. One subcommittee member noted that 
making substantive progress on this recommendation will not be 
possible until budget issues are addressed. According to FAA 
officials, funding reductions due to sequestration will not have a 
major effect on the program's development in fiscal year 2013. 
However, the officials noted that these reductions will delay some 
specific improvements, such as ASIAS's ability to detect instances 
where aircraft situational awareness is lost. 

* Analytical capabilities. According to FAA officials, labor 
agreements and other factors can affect the agency's ability to fully 
develop the analytical capabilities of ASIAS. For example, the ASIAS 
Executive Board must authorize analyses of ASIAS data, and in some 
cases, the members of the board are constrained by labor agreements 
that limit how their airlines' data can be used.[Footnote 69] FAA 
officials noted that while they provide the airlines with industry 
benchmarks from ASIAS so the airline can see how it compares on 
certain metrics, it is unclear how the airlines are using the data. In 
addition, FAA officials told us that because some of the identifying 
information is stripped from the data, FAA is limited in its analyses 
that would indicate the relative safety performance of a particular 
airline. For example, if the information is left with identifiers, 
then FAA would be able to pull other relevant reports associated with 
a particular flight, and could merge that data to understand all the 
relevant factors, and then de-identify the information. As mentioned 
in Table 12, FAA stated it is working with three airlines to 
demonstrate the benefits of using this approach. 

Related Products: 

General Aviation Safety: Additional FAA Efforts Could Help Identify 
and Mitigate Safety Risks. [hyperlink, 
http://www.gao.gov/products/GAO-13-36]. Washington, D.C.: October 4, 
2012. 

Aviation Safety: Additional FAA Efforts Could Enhance Safety Risk 
Management. [hyperlink, http://www.gao.gov/products/GAO-12-898]. 
Washington, D.C.: September 12, 2012. 

Aviation Safety: FAA Is Taking Steps to Improve Data, but Challenges 
for Managing Safety Risks Remain. [hyperlink, 
http://www.gao.gov/products/GAO-12-660T]. Washington, D.C.: April 25, 
2012. 

Aviation Safety: Improved Data Quality and Analysis Capabilities Are 
Needed as FAA Plans a Risk-Based Approach to Safety Oversight. 
[hyperlink, http://www.gao.gov/products/GAO-10-414]. Washington, D.C.: 
May 6, 2010. 

10. FAAC Recommendation--Prioritize Rulemaking: 

Issue Overview: 

The safety of the nation's flying public depends, in large part, on 
the aviation industry's compliance with safety regulations and FAA's 
enforcement of those regulations when violations occur. As part of 
FAA's oversight of aviation safety, FAA develops rules and regulations 
through the rulemaking process.[Footnote 70] FAA, the National 
Transportation Safety Board (NTSB), and we have previously expressed 
concerns about the efficiency and timeliness of FAA's rulemaking 
efforts.[Footnote 71] In 2010, we noted that a number of issues may 
contribute to a lengthy rulemaking process at FAA, including the need 
to conduct research, obtain public comment, and provide industry time 
to comply with the rule. In addition, we reported that external 
pressures--such as highly publicized accidents, recommendations by 
NTSB, and congressional mandates--as well as internal pressures, such 
as changes in management's emphasis, continued to add to and shift the 
agency's priorities, and that shifting priorities can add to delays. 
The FAAC report raised similar concerns, stating that the queue of 
potential rulemaking projects far exceeds the FAA capacity for action 
in a reasonable time period, and there does not appear to be a 
universally understood methodology for FAA to ensure the most 
effective projects receive the highest priority. 

Historically, FAA attempted to gain the industry's compliance with 
rules and regulations through enforcement tools, including levying 
fines and suspending or revoking operating certificates. However, as 
previously noted, FAA and the U.S. aviation industry are moving toward 
the adoption of safety management systems (SMS)--a data-driven, risk-
based safety oversight approach. The FAAC report raised concerns that 
FAA's enforcement policies are not reflective of the shift to SMS, 
because FAA focuses its enforcement on regulatory non-compliance, 
regardless of risk level, rather than prioritizing its efforts to 
address unacceptable risks. 

DOT's and FAA's Actions to Address Recommendation: 

Table 13 provides a summary of the FAAC recommendation to review FAA's 
rulemaking priorities and FAA's actions to address it, as of June 2013. 

Table 13: FAAC Recommendation on Rulemaking Priorities and DOT's and 
FAA's Actions to Address It, as of June 2013: 

FAAC recommendation--rulemaking: Promptly review the existing 
regulatory and safety initiative calendar to provide parameters and 
criteria for the FAA to prioritize its current and future rulemaking 
program. This review should include industry, or at a minimum seek 
industry input, and the results be made publicly available. In 
addition, FAA should review field safety and enforcement policies, 
procedures, and training to ensure they align with the safety 
management system (SMS) philosophies and supporting policies 
established by FAA; 
DOT/FAA actions: To address this recommendation, FAA tasked the 
Aviation Rulemaking Advisory Committee (ARAC) on March 30, 2011, to 
provide advice and recommendations on how to prioritize rulemaking 
projects. The ARAC, in turn, established the Rulemaking Prioritization 
Working Group (RPWG) to conduct its task. The RPWG developed a 
rulemaking prioritization model to collect and analyze information to 
prioritize rulemaking projects. The model includes: 
* A 3-part questionnaire that ensures that the problem is defined and 
factual data are gathered so that weighting and scoring of the problem 
and potential solution can take place; and; 
* A tool that uses the results of the questionnaire to weight and 
score the problem and potential solution within the following 
attributes: safety, environment, capacity, access, international, 
cost/impact, benefit, technology, legislative mandate, social impacts, 
and security effects. 
From May to October 2012, the RPWG and FAA subject matter experts 
tested the model by applying it to 12 final rules. As a result of the 
testing, the RPWG made improvements to the model. The RPWG submitted a 
final report recommending that FAA adopt the model across its lines of 
business. FAA accepted the recommendation report on January 31, 2013, 
and the Office of Rulemaking formed an implementation team, which 
drafted a plan outlining the process for implementing the RPWG's 
recommendation. FAA officials stated that the implementation team 
developed a tool that will provide a standardized basis for evaluating 
and prioritizing potential projects. The tool will be used by each 
line of business to evaluate potential rulemaking projects for the 
next fiscal year and will serve as the basis in establishing FAA's 
forecast list of potential rulemaking projects, which will replace the 
existing 4-Year Look Ahead.[A] 
With respect to aligning enforcement policies with SMS, FAA officials 
told us that because SMS was addressed by an earlier Aviation 
Rulemaking Committee and FAA was in the early stages of determining 
its SMS policy when the RPWG was tasked, SMS was not addressed by the 
RPWG. In 2012, FAA issued an order establishing a safety risk 
management policy for FAA and, according to FAA officials, the 
rulemaking prioritization team has included safety risk management 
questions in its tool. 

Source: FAAC report and GAO analysis of DOT and FAA documents and 
interviews. 

[A] The 4-Year Look Ahead provided a list of proposed projects that 
each line of business was considering for submittal to the rulemaking 
council to initiate rulemaking. 

[End of table] 

DOT's and FAA's Planned Actions: 

Officials from FAA's Office of Rulemaking stated that this 
recommendation has been addressed through ARAC and added that the 
implementation team is evaluating how to integrate the recommended 
model into the current rulemaking process without creating unnecessary 
redundancies. FAA officials stated they requested external feedback on 
the model through the ARAC, at ARAC's June 20, 2013, meeting. 
According to FAA officials, ARAC members generally support 
implementation activities and FAA is considering the feedback ARAC 
provided on the tool and future ARAC involvement. FAA plans to beta 
test the model in June 2013 and fully implement it in fiscal year 
2014. FAA officials stated that the current tool is supported by MS 
Excel, but noted that FAA is developing an automated version of all 
rulemaking tools and is including the prioritization model in the 
requirements. 

FAAC Members' Assessment of DOT's and FAA's Progress: 

Four of the six FAAC safety subcommittee members felt the 
recommendation was not fully addressed; two members felt it was 
addressed, although one stated that FAA should take additional actions 
as its work on this recommendation continues, and one member did not 
provide an opinion. One of the subcommittee members who stated the 
recommendation was not addressed, as well as one member who stated it 
was, suggested that FAA should be more transparent about its process. 
Another subcommittee member felt that FAA should communicate more with 
the NTSB when prioritizing rulemakings.[Footnote 72] Another 
subcommittee member stated FAA was making progress, but he was unsure 
where FAA was in the process since receiving the recommendations from 
the ARAC. The remaining member had concerns beyond prioritization of 
rulemaking, such as the clarity of FAA rules and the role of external 
input versus data when crafting rules. 

Challenges in Implementing the Recommendation: 

* Resource constraints. FAA officials noted that budget constraints 
could affect their efforts to implement and automate the model. For 
example, automating the model from current Microsoft Word and Excel 
files will require funding, though FAA officials stated that they can 
use an internal system for the initial implementation. 

* Addressing competing interests. Two FAAC subcommittee members noted 
that one challenge to implementing a rulemaking prioritization process 
is appropriately addressing aviation safety issues raised by external 
parties, such as the public, Congress, the DOT Inspector General, and 
GAO, without shifting FAA's focus from continuing to address other top 
priority issues. 

* Culture change. Two other FAAC subcommittee members noted that 
implementing this recommendation would require a culture change at 
FAA, which could be difficult. For example, one stressed the need for 
FAA to be proactive in addressing safety issues, and the other stated 
that FAA will need to develop a holistic approach toward rulemaking 
that allows it to address issues quickly. 

Related Products: 

Federal Rulemaking: Agencies Could Take Additional Steps to Respond to 
Public Comments. [hyperlink, http://www.gao.gov/products/GAO-13-21]. 
Washington, D.C.: December 20, 2012. 

Aviation Safety: Additional FAA Efforts Could Enhance Safety Risk 
Management. [hyperlink, http://www.gao.gov/products/GAO-12-898]. 
Washington, D.C.: September 12, 2012. 

Aviation Safety: Improved Planning Could Help FAA Address Challenges 
Related to Winter Weather Operations. [hyperlink, 
http://www.gao.gov/products/GAO-10-678]. Washington, D.C.: July 29, 
2010. 

Aviation Safety: Better Management Controls are Needed to Improve 
FAA's Safety Enforcement and Compliance Efforts. [hyperlink, 
http://www.gao.gov/products/GAO-04-646]. Washington, D.C.: July 6, 
2004. 

Aviation Rulemaking: Incomplete Implementation Impaired FAA's Reform 
Efforts. [hyperlink, http://www.gao.gov/products/GAO-01-950T]. 
Washington, D.C.: July 11, 2001. 

Aviation Rulemaking: Further Reform Is Needed to Address Long-standing 
Problems. [hyperlink, http://www.gao.gov/products/GAO-01-821]. 
Washington, D.C.: July 9, 2001. 

[End of section] 

Appendix I: Listing of the 23 Recommendations Made by the Future of 
Aviation Advisory Committee, by Area: 

Environment: 

1. Exercise strong national leadership to promote and showcase U.S. 
aviation as a first user of sustainable alternative fuels. 

2. Support research and development related to airframe and engine 
technologies. 

3. Secure operational and infrastructure improvements (NextGen, ground 
taxi delay management programs, and airport energy efficiency and 
emissions reduction program). 

4. Establish a harmonized approach for aviation carbon dioxide 
emission reductions. 

Financing: 

5. Support extending the alternative minimum tax exemption for airport 
private activity bonds. 

6. Fund accelerated Next Generation Air Transportation System 
(NextGen) equipage of aircraft. 

7. Deliver the benefits of NextGen. 

8. Review eligibility criteria for the Airport Improvement Program and 
Passenger Facility Charge Program. 

Competitiveness and viability: 

9. Promote the global competitiveness of the U.S. aviation industry. 

10. Commission an independent study of federal aviation taxes and fees. 

11. Ensure transparency in ticket pricing, fees, code-share, contracts 
of carriage, and travel statistics. 

12. Support intermodalism by establishing a task force, examining the 
Essential Air Service Program, and recommending that legislation 
prioritize intermodal links. 

13. Reform the Essential Air Service program. 

14. Continue to be involved in efforts to address jet fuel price 
volatility. 

Labor and world-class workforce: 

15. Ensure coordination and focus on science, technology, engineering, 
and math education programs. 

16. Urge the National Mediation Board to implement the Dunlop II 
recommendations. 

17. Implement a semi-annual Aviation Industry Workforce-Management 
Conference. 

Aviation Safety: 

18. Seek legal protections for safety data program participants. 

19. Support predictive analytic capabilities for safety data and 
information. 

20. Identify new sources of safety data and establish criteria for 
inclusion in voluntary data-sharing programs. 

21. Include safety performance standards and training into NextGen 
planning and implementation. 

22. Review and reprioritize FAA's rulemaking initiatives. 

23. Address issues related to child safety for air travel. 

[End of section] 

Appendix II: Future of Aviation Advisory Committee Members: 

The Department of Transportation (DOT) chartered the Future of 
Aviation Advisory Committee (FAAC) on April 16, 2010, to develop a 
manageable, actionable list of recommendations for DOT. The FAAC 
included 19 representatives --1 government official (DOT Assistant 
Secretary for Aviation and International Affairs) and 18 non-
government representatives--from a cross-section of stakeholders, such 
as air carriers, airports, airline labor unions, manufacturers, and 
representatives from the finance community, academia, and passenger 
interests. The FAAC established five subcommittees to develop 
recommendations in the five areas of interest specified in the FAAC 
charter: environment, financing, competitiveness and viability, labor 
and workforce, and safety. A list of the FAAC members, as well as the 
subcommittees they served on, is provided in table 14. 

Table 14: Non-Government FAAC Members: 

FAAC member: Juan J. Alonso, Associate Professor in the Department of 
Aeronautics & Astronautics, Stanford University; 
Groups represented: Academic - Environment; 
Subcommittees: Environment; Safety. 

FAAC member: Susan Baer, Director, Aviation Department, Port Authority 
of New York and New Jersey; 
Groups represented: Airports; 
Subcommittees: Competitiveness; Safety. 

FAAC member: David Barger, President and CEO, JetBlue Airways 
Corporation; 
Groups represented: Airlines; 
Subcommittees: Labor; Safety. 

FAAC member: Bryan Bedford, Chairman, President & CEO, Republic 
Airways Holdings, Inc.; 
Groups represented: Airlines; 
Subcommittees: Environment; Competitiveness. 

FAAC member: Severin Borenstein, E.T. Grether Professor of Business 
Administration and Public Policy at the Haas School of Business and Co-
Director of the Energy Institute at Haas, and Director of the 
University of California Energy Institute; 
Groups represented: Academic - Economics; 
Subcommittees: Finance; Competitiveness. 

FAAC member: Thella Bowens, President & CEO, San Diego County Regional 
Airport Authority; 
Groups represented: Airports; 
Subcommittees: Finance; Labor. 

FAAC member: John Conley, International Administrative Vice President, 
Transport Workers Union of America, AFL-CIO; 
Groups represented: Labor; 
Subcommittees: Labor; Safety. 

FAAC member: Cynthia Egnotovich, President for Customer Service, UTC 
Aerospace Systems; 
Groups represented: Manufacturers; 
Subcommittees: Environment; Labor. 

FAAC member: Patricia Friend, Retired (former International President, 
Association of Flight Attendants-CWA, AFL-CIO); 
Groups represented: Labor; 
Subcommittees: Competitiveness; Labor. 

FAAC member: Robert Lekites, Executive Vice President, Customers, 
Airbus (former President of United Parcel Service Airlines); 
Groups represented: Airlines; 
Subcommittees: Labor; Safety. 

FAAC member: Ana McAhron-Schulz, Director of Economic and Financial 
Analysis, Air Line Pilots Association; 
Groups represented: Labor; 
Subcommittees: Competitiveness; Labor. 

FAAC member: William McGee, Travel and Aviation Consultant for 
Consumers Union; 
Groups represented: Consumers; 
Subcommittees: Competitiveness; Safety. 

FAAC member: Daniel McKenzie, Analyst, Buckingham Research Group; 
Groups represented: Analyst - Finance; 
Subcommittees: Finance; Competitiveness. 

FAAC member: Jack Pelton, Managing Director for Aviation Alliance LLC 
(former Chairman, President, and CEO, Cessna Aircraft Company); 
Groups represented: General Aviation; 
Subcommittees: Finance; 
Competitiveness. 

FAAC member: Nicole Piasecki, Vice President for Propulsion, Boeing 
Commercial Airplanes; 
Groups represented: Manufacturers; 
Subcommittees: Environment; Safety. 

FAAC member: Raul Regalado, Principal, Raul Regalado and Associates 
(former President & CEO, Metropolitan Nashville Airport Authority); 
Groups represented: Airports; 
Subcommittees: Environment; Finance. 

FAAC member: Glenn Tilton, Vice Chairman at JPMorgan Chase (former 
Chairman, President & CEO of UAL Corporation--United Airlines); 
Groups represented: Airlines; 
Subcommittees: Finance; Competitiveness. 

FAAC member: Christopher J. Williams[A]; 
Chairman, CEO and founder of The Williams Capital Group, L.P. and 
Williams Capital Management, LLC; 
Groups represented: Finance; 
Subcommittees: Finance; Competitiveness. 

Source: GAO analysis of DOT documents. 

[A] Mr. Williams was not available for an interview. 

[End of table] 

[End of section] 

Appendix III: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Gerald L. Dillingham, Ph.D., (202) 512-2834 or dillinghamg@gao.gov: 

Staff Acknowledgments: 

In addition to the contact named above the following individuals made 
important contributions to this report: Heather Krause (Assistant 
Director); Amy Abramowitz; Melissa Bodeau; Anne Dore; Kevin Egan; 
Crystal Huggins; Bert Japikse; Aaron Kaminsky; Bill Keller; Tim 
Minelli; SaraAnn Moessbauer; Susan Offutt; Paul Revesz; Marylynn 
Sergent; Gretchen Snoey; Pamela Vines; and Jessica Wintfeld. 

[End of section] 

Footnotes: 

[1] See appendix I for a complete list of all 23 recommendations from 
the FAAC. 

[2] One FAAC member was not available for an interview. 

[3] In 2006, GAO reviewed the progress that federal agencies, 
including the FAA, had made in addressing the recommendations made by 
the Commission on the Future of the United States Aerospace Industry. 
GAO, U.S. Aerospace Industry: Progress in Implementing Aerospace 
Commission Recommendations, and Remaining Challenges, [hyperlink, 
http://www.gao.gov/products/GAO-06-920] (Washington, D.C.: Sept. 13, 
2006). 

[4] Pub. L. No. 92-463, 86 Stat. 770 (1972), codified, as amended, at 
5 U.S.C. app. § 2. The FACA sets forth requirements for FACA advisory 
groups' formation, their operations, and how they provide advice and 
recommendations to the federal government. 

[5] GAO, Federal Advisory Groups: DOT and DOE Can Take Steps to Better 
Assess Duplication Risk and Enhance Usefulness, [hyperlink, 
http://www.gao.gov/products/GAO-12-472] (Washington, D.C.: Mar. 29, 
2012). 

[6] Future of Aviation Advisory Committee, Record of Meeting 
(Washington, D.C.: May 25, 2010). 

[7] FAA's current NextGen implementation plans include midterm 
implementation activities through 2020 and the long term to 2025 and 
beyond. 

[8] FAA Modernization and Reform Act of 2012, Pub. L. No. 112-95, § 
310, 126 Stat. 11, 64 (2012). 

[9] GAO has reported that FAA is in the midst of a shift toward a 
proactive, data-driven safety oversight approach, commonly referred to 
as a safety management system (SMS) approach. Under this new approach, 
FAA plans to use aviation safety data to identify system-wide trends 
in aviation safety and manage emerging hazards before they result in 
incidents or accidents. See GAO, Aviation Safety: FAA Efforts Have 
Improved Safety but Challenges Remain in Key Areas, [hyperlink, 
http://www.gao.gov/products/GAO-13-442T] (Washington, D.C.: Apr. 16, 
2013). 

[10] GAO, Aviation and Climate Change: Aircraft Emissions Expected to 
Grow, but Technological and Operational Improvements and Government 
Policies Can Help Control Emissions, [hyperlink, 
http://www.gao.gov/products/GAO-09-554] (Washington, D.C.: June 8, 
2009) 

[11] Feedstock refers to the raw material from which fuel is derived. 
Cellulosic feedstocks are a specific type of feedstock that are made 
of cellulosic (plant-based) materials such as corn stover (the cobs, 
stalks, leaves, and husks of corn plants) or switchgrass. 

[12] ASTM International, formerly known as the American Society for 
Testing and Materials, works to deliver the test methods, 
specifications, guides, and practices that support industries and 
governments worldwide. 

[13] GAO, Aviation and Climate Change: Aircraft Emissions Expected to 
Grow, but Technological and Operational Improvements and Government 
Policies Can Help Control Emissions, [hyperlink, 
http://www.gao.gov/products/GAO-09-554] (Washington, D.C.: June 8, 
2009). 

[14] ICAO is an advisory organization affiliated with the United 
Nations that aims to promote the establishment of international civil 
aviation standards and recommended practices and procedures. 

[15] In subsequent meetings, ICAO's Committee on Aviation 
Environmental Protection also agreed on a metric to characterize 
aircraft CO2 emissions and aircraft emissions certification procedures. 

[16] Market-based measures can establish a price for emissions and 
provide incentives to airlines and consumers to reduce emissions. 
Examples include a cap-and-trade system or a tax on emissions. 

[17] GAO, Next Generation Air Transportation: Collaborative Efforts 
with European Union Generally Mirror Effective Practices, but Near-
Term Challenges Could Delay Implementation, [hyperlink, 
http://www.gao.gov/products/GAO-12-48] (Washington, D.C.: Nov. 3, 
2011). 

[18] See GAO, Airport Finance: Observations on Planned Airport 
Development Costs and Funding Levels and the Administration's Proposed 
Changes in the Airport Improvement Program, [hyperlink, 
http://www.gao.gov/products/GAO-07-885] (Washington, D.C.: June 29, 
2007). 

[19] The interest earned on most bonds issued by state and local 
governments is tax-exempt, meaning that the interest paid to 
bondholders is generally not included in their gross income for 
federal income tax purposes. Tax-exempt bonds reduce the issuer's 
borrowing costs because purchasers of such debt are willing to accept 
a lower rate of interest than that of taxable debt of comparable risk 
and maturity. 

[20] AMT is a separate federal tax system that applies to both 
individual and corporate taxpayers. It parallels the income tax system 
but with different rules for determining taxable income, different tax 
rates for computing tax liability, and different rules for allowing 
the use of tax credits. 

[21] Pub. L. No. 111-5, § 1503, 123 Stat. 115, 354 (2009), amending 26 
U.S.C. §§ 56, 57. 

[22] In addition, the President's budget proposal for fiscal year 2014 
includes provisions that may affect AMT exemptions, such as a proposal 
to limit the tax rate at which high income taxpayers can reduce their 
tax liability to a maximum of 28 percent. 

[23] GAO, Tax Expenditures: Background and Evaluation Criteria and 
Questions, [hyperlink, http://www.gao.gov/products/GAO-13-167SP] 
(Washington, D.C.: Nov. 29, 2012). 

[24] The Joint Committee on Taxation estimated that temporarily 
exempting all private activity bonds from the AMT for 2012 would have 
reduced federal revenue by $215 million over the 10-year period from 
2012 through 2022. In addition, the Congressional Budget Office and 
the Joint Committee on Taxation issued a joint report in 2009 which 
found that tax-exempt bonds are a costly and inefficient method for 
delivering a subsidy, because the loss of federal receipts is greater 
than the reduction in the interest costs of tax-exempt issuers. 

[25] [hyperlink, http://www.gao.gov/products/GAO-13-167SP]. 

[26] In April 2013, we reported on FAA's efforts to deliver benefits 
in the midterm (through 2018) by implementing operational improvements 
that use available technologies. See GAO, NextGen Air Transportation 
System: FAA Has Made Some Progress in Midterm Implementation, but 
Ongoing Challenges Limit Expected Benefits, [hyperlink, 
http://www.gao.gov/products/GAO-13-264] (Washington, D.C.: Apr. 8, 
2013). 

[27] GAO, Next Generation Air Transportation System: FAA Faces 
Implementation Challenges, [hyperlink, 
http://www.gao.gov/products/GAO-12-1011T] (Washington, D.C.: Sept. 12, 
2012). 

[28] See Federal Credit Reform Act of 1990, Pub. L. No. 93-344, § 504, 
as added by Pub. L. No. 101-508, 104 Stat. 1388-609 (1990), codified 
at 2 U.S.C. § 661c(b). 

[29] GAO, Next Generation Air Transportation System: Progress and 
Challenges Associated with the Transformation of the National Airspace 
System, [hyperlink, http://www.gao.gov/products/GAO-07-25] 
(Washington, D.C.: Nov. 13, 2006). 

[30] The Balanced Budget and Emergency Deficit Control Act (BBEDCA), 
as amended, established discretionary spending limits for fiscal years 
2012 to 2021. 2 U.S.C. § 901. BBEDCA also required the Office of 
Management and Budget to calculate, and the President to order, a 
sequestration, i.e., cancellation, of budgetary resources on March 1, 
2013. See 2 U.S.C. § 901a. For fiscal year 2013, the President ordered 
a sequestration of about $85 billion. Sequestration Order for Fiscal 
Year 2013 Pursuant to Section 251A of the Balanced Budget and 
Emergency Deficit Control Act, As Amended, 78 Fed. Reg. 14633 (Mar. 6, 
2013). 

[31] [hyperlink, http://www.gao.gov/products/GAO-13-264]. Organized in 
1935, RTCA (once known as Radio Technical Commission for Aeronautics) 
is a private, not-for-profit corporation that develops consensus-based 
recommendations for communications, navigation, surveillance, and air 
traffic management system issues. 

[32] RTCA, NextGen Equipage: User Business Case Gaps, A Report of the 
NextGen Advisory Committee in Response to Tasking from the Federal 
Aviation Administration (September 2011). 

[33] Information about the level of local equipage is important 
because the level of equipage can affect how often airlines are able 
to use new routes. A new route into Chicago, for example, that allows 
for the simultaneous use of runways at O'Hare International and Midway 
has to be closed whenever a non-equipped aircraft arrives on the 
approach to Midway. 

[34] [hyperlink, http://www.gao.gov/products/GAO-13-264]. 

[35] The AIP was established by the Airport and Airway Improvement Act 
of 1982 (Pub. L. No. 97-248, § 505, 96 Stat. 324, codified as positive 
law at 49 U.S.C. chapter 471), and the PFC was authorized under the 
Aviation Safety and Capacity Expansion Act of 1990 (Pub. L. No. 101-
508, § 9110, 104 Stat. 1388-353, codified as positive law at 49 U.S.C. 
§ 40117). 

[36] To be eligible for AIP, an airport must be included in FAA's 
National Plan of Integrated Airport Systems, which identifies airports 
that are significant to national air transportation and contribute to 
the needs of civil aviation, national defense, and the Postal Service. 

[37] The Airport and Airway Trust Fund is funded principally by a 
variety of excise taxes paid by users of the national airspace system, 
as well as by interest revenue. The excise taxes are imposed on 
airline ticket purchases and aviation fuel, as well as the shipment of 
cargo. 

[38] Projects related to airport operations and revenue-generating 
improvements are typically not eligible for funding. For example, 
operational costs, such as salaries, equipment, and supplies, and 
commercial revenue-producing portions of airports and airport 
terminals are generally not eligible for AIP grants. 

[39] PFCs are collected as part of the current ticket payment and 
distribution process, which involves many parties. Airlines remit PFCs 
to airports minus a small administrative charge per PFC collected. 
GAO, Alternative Methods for Collecting Airport Passenger Facility 
Charges, [hyperlink, http://www.gao.gov/products/GAO-13-262R] 
(Washington, D.C.: Feb. 14, 2013). 

[40] According to a 2013 GAO report, most PFC funds, or 74 percent of 
approved collection revenue for PFC projects, are used to enhance 
capacity and reduce congestion. [hyperlink, 
http://www.gao.gov/products/GAO-13-262R]. 

[41] Reducing Flight Delays Act of 2013, Pub. L. No. 113-9, § 2, 127 
Stat. 443, 444 (2013). 

[42] The President's Fiscal Year 2014 budget submission includes a 
proposal to raise the PFC cap from $4.50 to $8.00 and lower AIP 
funding to $2.9 billion, offset in part by eliminating passenger and 
cargo entitlement funding for large hub airports. This proposal also 
would allow all commercial service airports to increase their non-
federal passenger facility charge. 

[43] [hyperlink, http://www.gao.gov/products/GAO-13-262R]. 

[44] GAO, Transatlantic Aviation: Effects of Easing Restrictions on 
U.S.-European Markets, [hyperlink, 
http://www.gao.gov/products/GAO-04-835] (Washington, D.C.: July 21, 
2004). For decades, international air service has been governed by 
aviation agreements negotiated between countries to specify "traffic 
rights," such as the number of airlines that can operate between 
markets, the airports from and to which they operate, the number of 
flights that can be provided, and the fares that airlines could charge. 

[45] Airport slots refer to the permission to land or take-off at a 
congested airport at a specific time on a specific day, and are also 
used at certain airports in the United States, such as three in New 
York and New Jersey. We reported on FAA's administration of slot 
restrictions. See, GAO, Slot-Controlled Airports: FAA's Rules Could be 
Improved to Enhance Competition and Use of Available Capacity, 
[hyperlink, http://www.gao.gov/products/GAO-12-902] (Washington, D.C.: 
Sept. 13, 2012). 

[46] 49 U.S.C § 41308. 

[47] Economists in the Department of Justice's Economic Analysis Group 
published a review of DOT's prior decisions to grant antitrust 
immunity for alliance requests and found that a grant of antitrust 
immunity to carriers in an alliance reduces competition in routes 
where these carriers offer competing flights and that fares paid by 
passengers for travel in non-stop trans-Atlantic flights are higher in 
routes with fewer independent competitors. The review's authors also 
stated that the data show that alliances can produce pricing 
efficiencies for trans-Atlantic passengers who travel with connecting 
itineraries, but antitrust immunity within an alliance is not 
necessary to achieve such efficiencies. Gillespie, William and Oliver 
M. Richard, Antitrust Immunity and International Airline Alliances, 
EAG 11-1 (February 2011), accessed April 11, 2013, [hyperlink, 
http://www.justice.gov/atr/public/eag/267513.htm]. 

[48] Many countries limit foreign ownership of national airlines. For 
example, non-US citizens may not own more than 25 percent of the 
controlling interest in an American airline (or 50 percent of an 
equity interest). 

[49] The Export Promotion Cabinet consists of the Secretaries of 
State, Treasury, Agriculture, Commerce, Labor, Energy, and 
Transportation; the Director of the Office of Management and Budget; 
the United States Trade Representative; the Assistant to the President 
for Economic Policy; the National Security Advisor; the Chair of the 
Council of Economic Advisers; the President of the Export-Import Bank 
of the United States; the Administrator of the Small Business 
Administration; the President of the Overseas Private Investment 
Corporation; and the Director of the United States Trade and 
Development Agency. 

[50] These FAAC members noted that during the development of the FAAC 
report, there were concerns regarding the U.S. labor impacts of an 
agreement between United Airlines and Aer Lingus to share profits for 
a route between Washington, D.C. and Madrid. United marketed the 
flight and Aer Lingus operated it. 

[51] The FAAC recommendation stated that DOT should consider existing 
statutory criteria, which includes encouraging fair wage and working 
conditions, when conducting its public interest analysis. However, the 
discussion of the specific issues raised by the FAAC members we 
interviewed were included in the "Other Areas of Significant 
Discussion" section of the report, under "Outsourcing" and 
"Incorporating Core Workers' Human Rights Conventions into 
International Aviation Trade Agreements." DOT, The Future of Aviation 
Advisory Committee Final Report (Washington, D.C.: Apr. 11, 2011). 

[52] GAO, Higher Education: Federal Science, Technology, Engineering, 
and Mathematics Programs and Related Trends, [hyperlink, 
http://www.gao.gov/products/GAO-06-114] (Washington, D.C.: Oct. 12, 
2005). 

[53] The number of programs within agencies ranged from 3 to 46, with 
the Departments of Health and Human Services and Energy and the 
National Science Foundation administering more than half of these 
programs. GAO, Science, Technology, Engineering, and Mathematics 
Education: Strategic Planning Needed to Better Manage Overlapping 
Programs across Multiple Agencies, [hyperlink, 
http://www.gao.gov/products/GAO-12-108] (Washington, D.C.: Jan. 20, 
2012) 

[54] We previously recommended that as the Office of Science and 
Technology Policy (OSTP) leads the government-wide STEM education 
strategic planning effort, it should (1) work with agencies to better 
align their activities with a government-wide strategy, (2) develop a 
plan for sustained coordination, (3) identify programs for potential 
consolidation or elimination, and (4) assist agencies in determining 
how to better evaluate their programs. OSTP stated that it would 
address our recommendations in the 5-year federal STEM Education 
Strategic Plan. As part of our ongoing work on duplication, overlap, 
and fragmentation, we report on the status of OSTP's efforts on these 
items through our action tracker [hyperlink, 
http://www.gao.gov/duplication/action_tracker]. As of March 6, 2013, 
item 3 is addressed, item 1 is partially addressed, and items 2 and 4 
are not addressed. 

[55] The GPRA Modernization Act of 2010, Pub. L. No. 111-352, § 5, 124 
Stat. 3866, 3873 (Jan. 4, 2011), codified at 31 U.S.C. § 1120, 
requires that OMB, in coordination with agencies and in consultation 
with Congress, develop long-term goals for a limited number of 
crosscutting policy areas and management improvement areas--referred 
to as cross-agency priority goals--every 4 years. 

[56] GAO, Managing for Results: GAO's Work Related to the Interim 
Crosscutting Priority Goals under the GPRA Modernization Act, 
[hyperlink, http://www.gao.gov/products/GAO-12-620R] (Washington, 
D.C.: May 31, 2012). GAO also discussed STEM education in GAO, 2012 
Annual Report: Opportunities to Reduce Duplication, Overlap and 
Fragmentation, Achieve Savings, and Enhance Revenue, [hyperlink, 
http://www.gao.gov/products/GAO-12-342SP] (Washington, D.C.: Feb. 28, 
2012). 

[57] America COMPETES Reauthorization Act of 2010, Pub. L. No. 111-
358, 124 Stat. 3982 (2011). 

[58] CoSTEM members include the Departments of Agriculture, Commerce, 
Defense, Education, Energy, Health and Human Services, Interior, 
Transportation, as well as the Environmental Protection Agency, 
National Aeronautics and Space Administration, and National Science 
Foundation. 

[59] STEM-AVSED was established in response to Pub. L. No. 94-353, § 
21, 90 Stat. 871 (1976), which empowered the FAA Administrator to 
establish a civil aviation information distribution program to provide 
state and local school administrators, college and university 
officials, and officers of civil and other interested organizations 
with informational materials and expertise on civil aviation. 

[60] [hyperlink, http://www.gao.gov/products/GAO-12-620R], GAO, 
Science, Technology, Engineering, and Mathematics Education: Strategic 
Planning Needed to Better Manage Overlapping Programs across Multiple 
Agencies, [hyperlink, http://www.gao.gov/products/GAO-12-108] 
(Washington, D.C.: Jan. 20, 2012), and GAO, 2012 Annual Report: 
Opportunities to Reduce Duplication, Overlap and Fragmentation, 
Achieve Savings, and Enhance Revenue, [hyperlink, 
http://www.gao.gov/products/GAO-12-342SP] (Washington, D.C.: Feb. 28, 
2012). 

[61] We have previously reported on FAA's implementation of SMS. See 
GAO, Aviation Safety: FAA Efforts Have Improved Safety but Challenges 
Remain in Key Areas, [hyperlink, 
http://www.gao.gov/products/GAO-13-442T] (Washington, D.C.: Apr 16, 
2013); GAO, Aviation Safety: Additional FAA Efforts Could Enhance 
Safety Risk Management, [hyperlink, 
http://www.gao.gov/products/GAO-12-898] (Washington, D.C.: Sept 12, 
2012); GAO, Aviation Safety: FAA Is Taking Steps to Improve Data, but 
Challenges for Managing Safety Risks Remain, [hyperlink, 
http://www.gao.gov/products/GAO-12-660T], (Washington, D.C.: Apr 25, 
2012); and GAO, Aviation Safety: Improved Data Quality and Analysis 
Capabilities Are Needed as FAA Plans a Risk-Based Approach to Safety 
Oversight, [hyperlink, http://www.gao.gov/products/GAO-10-414] 
(Washington, D.C.: May 6, 2010). 

[62] One example of a mandatory system is the Air Traffic Quality 
Assurance database, which contains information recorded by air traffic 
controller supervisors, support specialists, and managers. With 
respect to inspections, FAA records data from maintenance and 
operations inspections in the Air Transportation Oversight System 
(ATOS). Under the ATOS concept, FAA inspectors use data analysis to 
focus their inspections on areas that pose the greatest risk. ATOS 
also permits inspectors to shift the focus of their inspections in 
response to changing conditions within air carriers' operations. 

[63] [hyperlink, http://www.gao.gov/products/GAO-12-898]. 

[64] The Airline Safety and Federal Aviation Administration Extension 
Act of 2010, Pub. L. No. 111-216, § 215, 124 Stat. 2348, 2366 (2010), 
required the FAA to require all part 121 air carriers to implement 
SMS. In its Notice of Proposed Rulemaking on implementing this 
requirement, FAA stated that SMS should include systems for safety 
performance monitoring and measuring, including a confidential 
employee safety reporting system. FAA noted that while certain 
voluntary programs, such as the Aviation Safety Action Program (ASAP), 
would be useful as part of a carrier's SMS system, it would not 
mandate the use of such programs, as that would result in the data 
becoming mandatory and thus losing existing statutory protections. 75 
Fed. Reg. 68224, 68228 (Nov. 5, 2010). FAA has not issued a final rule. 

[65] [hyperlink, http://www.gao.gov/products/GAO-12-898]. FAA issues 
airport operating certificates to airports that (1) serve unscheduled 
air carrier aircraft with more than 30 seats; or (2) serve scheduled 
air carrier operations in aircraft with more than 9 seats. 14 C.F.R. § 
139.1(a). Most certificated U.S. airports are either owned by a state, 
a subdivision of a state, or a local government body, and thus are 
subject to state laws, including state FOIA laws. 

[66] Another subcommittee member had underlying concerns regarding 
FAA's oversight of airlines and felt those should be addressed. These 
concerns were not discussed in the FAAC report's discussion of the 
recommendation, but were discussed in the "Other Areas of Significant 
Discussion" section of the report, under "Safety And Security Of 
Contract Maintenance Facilities." DOT, The Future of Aviation Advisory 
Committee Final Report (Washington, D.C.: Apr. 11, 2011). 

[67] The FAAC report included a recommendation for DOT and FAA to work 
with stakeholders to identify potential new sources of safety data to 
be included in voluntary data-sharing programs. While we did not 
review DOT's and FAA's progress on this recommendation, we did review 
their progress in addressing the FAAC recommendation on protecting 
safety data from disclosure: see the discussion of recommendation 8. 

[68] GAO has previously commented on and made recommendations about 
the data quality issues. See [hyperlink, 
http://www.gao.gov/products/GAO-13-442T], [hyperlink, 
http://www.gao.gov/products/GAO-13-36], [hyperlink, 
http://www.gao.gov/products/GAO-12-898], [hyperlink, 
http://www.gao.gov/products/GAO-12-660T], and [hyperlink, 
http://www.gao.gov/products/GAO-10-414]. 

[69] ASIAS is governed by an Executive Board comprised of 
representatives from government and industry. 

[70] The basic process by which agencies develop and issue regulations 
is spelled out in the Administrative Procedure Act (5 U.S.C. §§ 551-
570a.) Although there are exceptions, rulemaking generally involves 
the agency publishing a notice of proposed rulemaking and asking for 
public comment, then issuing a final rule and responding to the public 
comments received. A need for rulemaking can be identified internally, 
by one of FAA's offices, or externally, by an outside source such as 
the Congress or the National Transportation Safety Board, which issues 
mandates or recommendations, respectively, calling for rulemaking. 

[71] GAO, Aviation Rulemaking: Further Reform Is Needed to Address 
Long-standing Problems, [hyperlink, 
http://www.gao.gov/products/GAO-01-821] (Washington, D.C.: July 9, 
2001) and Aviation Safety: Improved Planning Could Help FAA Address 
Challenges Related to Winter Weather Operations, [hyperlink, 
http://www.gao.gov/products/GAO-10-678] (Washington, D.C.: July 29, 
2010). 

[72] This subcommittee member was particularly concerned about FAA's 
policy regarding child restraint systems in aircraft, which was 
discussed in the FAAC report under recommendation 23. 

[End of section] 

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