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Pursuant to a congressional request, GAO reviewed the Federal Aviation Administration's (FAA) use of letters of intent (LOI) to fund projects under its Airport Improvement Program (AIP).

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Recommendations

Recommendations for Executive Action

Agency Affected Recommendation Status
Department of Transportation To ensure that letters of intent are used in accordance with congressional direction, the Secretary of Transportation should direct the Administrator, FAA, to set a timetable to establish a goal for improving systemwide capacity and a definition of a significant capacity enhancement in relation to this goal, and analyze projects proposed for letters of intent against this goal and definition.
Closed - Implemented

Recommendation status is Closed - Implemented.

FAA has developed a policy on the criteria it will use to award letters of intent. This policy was published in the Federal Register on October 31, 1994.
Department of Transportation To ensure that letters of intent are used in accordance with congressional direction, the Secretary of Transportation should direct the Administrator, FAA, to provide justification and obtain approval from Congress if the agency wants to expand the statutory criteria for the use of letters of intent beyond projects that significantly enhance systemwide capacity.
Closed - Implemented

Recommendation status is Closed - Implemented.

FAA responded that if it identifies a need to expand LOI eligibility beyond projects that comport with existing statutory criteria, it will seek congressional approval. FAA is formulating a revised policy statement to further clarify the types of projects that it intends to approve for LOI. While FAA previously considered both ground and air capacity improvements as appropriate for LOI, FAA's revised policy will emphasize air capacity projects only.
Department of Transportation To ensure that letters of intent are used in accordance with congressional direction, the Secretary of Transportation should direct the Administrator, FAA, to plan commitments under letters of intent for each fiscal year on the basis of more conservative assumptions about future discretionary funding levels in the Airport Improvement Program.
Closed - Implemented

Recommendation status is Closed - Implemented.

FAA is strengthening the analysis for projects being considered for LOI by increasing its emphasis on more rigorous analyses of the sponsor's financial commitment and the benefit/cost ratio of the projects. Also, FAA plans to analyze the airport for which LOI is requested and estimate the current hours of annual flight delay and then determine the systemwide impact of the project in terms of reduced annual aircraft and passenger delays at current and future airport activity levels.

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