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Highlights

In January 2007 Federal Aviation Administration (FAA) reported the results of its study that assigned the fiscal year 2005 costs of its Air Traffic Organization (ATO) to users. FAA used this study to support the President's proposal to replace many current excise taxes with cost-based fees for commercial aviation users and higher fuel taxes for general aviation users. GAO assessed (1) the consistency of FAA's cost assignment methodology with established standards and guidance, (2) the support for selected cost assignment assumptions and methods, and (3) the impact of including budgeted capital costs in the cost baseline. GAO compared FAA's methodology to federal accounting standards and international guidance, reviewed available documents and analyses supporting FAA's assumptions and methods, and interviewed FAA officials and consultants.

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Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Transportation 1. To provide additional support for the reasonableness of FAA's cost assignment methodology and to monitor Facilities and Equipment (F&E) cost assignments to users, the Secretary of Transportation should direct the Administrator of FAA to adequately document the basis on which costs are assigned to user groups.
Closed - Not Implemented
On May 6, 2011, FAA informed us that it had decided not to continue development of a cost model for assigning air traffic control costs to users.
Department of Transportation 2. To provide additional support for the reasonableness of FAA's cost assignment methodology and to monitor F&E cost assignments to users, the Secretary of Transportation should direct the Administrator of FAA to evaluate the methods and basis upon which various overhead, indirect, and other miscellaneous costs are assigned to user groups and document the effect of any changes thereto.
Closed - Not Implemented
On May 6, 2011, FAA informed us that it had decided not to continue development of a cost model for assigning air traffic control costs to users.
Department of Transportation 3. To provide additional support for the reasonableness of FAA's cost assignment methodology and to monitor F&E cost assignments to users, the Secretary of Transportation should direct the Administrator of FAA to determine whether and quantify the extent to which commercial, general aviation, and exempt users who use either single type of aircraft--turbine or piston--impose costs differently on the air traffic control system.
Closed - Not Implemented
On May 6, 2011, FAA informed us that it had decided not to continue development of a cost model for assigning air traffic control costs to users.
Department of Transportation 4. To provide additional support for the reasonableness of FAA's cost assignment methodology and to monitor F&E cost assignments to users, the Secretary of Transportation should direct the Administrator of FAA to establish a mechanism for monitoring, by user group, any cumulative difference between original cost allocations for budgeted facilities and equipment project costs and actual usage of those assets, and adjusting prospective cost assignments accordingly.
Closed - Not Implemented
On May 6, 2011, FAA informed us that it had decided not to continue development of a cost model for assigning air traffic control costs to users.

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