Summary
The National Airspace System (NAS) is a complex network of airports, aircraft, air traffic control (ATC) facilities, employees, and pilots. The aviation industry, which depends on the NAS, contributes about 9 percent to the gross domestic product. The Federal Aviation Administration (FAA), funded through a tax-financed trust fund and General Fund appropriations, is pursuing a multibillion-dollar modernization program. Persistent cost, schedule, and/or performance shortfalls have kept this program on GAO's list of high-risk programs since 1995. GAO was asked to review the status of NAS modernization. This report addresses NAS status by identifying the challenges that FAA faces in managing (1) infrastructure, (2) human capital, and (3) financial resources.
GAO's recent reports indicate that FAA has made progress in managing its infrastructure--the systems, facilities, airports, and navigation aids that comprise the NAS--but acquisition, security, and capacity challenges remain. FAA met its fiscal year 2004 acquisitions performance goal. This goal was consistent with the President's Management Agenda and represents a positive step. However, FAA needs to continue addressing four key factors that, as GAO has reported, have historically contributed to acquisitions' missing their original cost, schedule, and performance targets: (1) actual funding less than planned, (2) increases in projects' scope, (3) underestimates of software complexity, and (4) insufficient stakeholder involvement. To address these factors, FAA has begun to prioritize its investments by considering their potential to reduce operational costs and by developing a blueprint for information technology investment; but FAA still needs to secure information technology systems and expand the NAS's capacity for an expected 25 percent increase in air travel by 2015. Human capital management challenges include hiring and training thousands of air traffic controllers to replace those expected to retire over the next decade and creating a results-oriented culture. FAA has developed a controller staffing plan, but has not estimated its cost, and therefore, cannot determine its impact on future budgets. Efforts to transform FAA's workforce culture address an impediment to ATC modernization that GAO has identified, but will require a sustained, multiyear commitment. Rising costs and shrinking revenues pose financial management challenges. To manage costs, FAA is using a new cost accounting system and emphasizing accountability. However, in view of current and anticipated funding reductions, FAA has eliminated initial research and development funding for new technologies that could support the next-generation air transportation system. Some stakeholders and FAA officials are discussing potential changes to FAA's funding mechanism. Some experts, and GAO's work, suggest that FAA pursue near-term options, such as contracting out more services. After establishing a sound financial management record, FAA could pursue options for greater financial management flexibility.
Recommendations
Our recommendations from this work are listed below with a Contact for more information. Status will change
from "In process" to "Implemented" or "Not implemented" based on our follow up work.
Director:
Team:
Phone:
Gerald L. Dillingham
Government Accountability Office: Physical Infrastructure
(202) 512-4803
Recommendations for Executive Action
Recommendation: To provide Congress with accurate information on the resources needed to hire and train thousands of air traffic controllers over the next decade, the Secretary of Transportation should direct the FAA Administrator to estimate the cost of FAA's controller hiring and training plan and incorporate these estimates into future budget requests.
Agency Affected: Department of Transportation
Status: In process
Comments: Although FAA told us that the cost to hire and train the new controllers to support the most recent updated staffing plan, A Plan for the future: The FAA's 10-Year strategy for the Air Traffic Control Workforce, is embedded in the agency's annual budget, FAA has not provided supporting documentation. We are awaiting documentation that we can review to determine if the recommendation should be closed.
Recommendation: To ensure that FAA provides the long-term focus needed for an effective cultural transformation, the Secretary of Transportation should direct the FAA Administrator to provide sustained oversight of efforts to transform FAA's workforce culture to one that is more results-oriented, including periodically monitoring the agency's progress against baseline data.
Agency Affected: Department of Transportation
Status: In process
Comments: FAA has taken steps to transform to a workforce culture that is more business-like and results oriented. However, it is too early to determine whether FAA has institutionalized these changes to ensure that they become permanently embedded in the workforce culture. We will review this recommendation again to determine if FAA has institutionalized changes.
Recommendation: To position FAA to best meet NAS needs in both the near term, and the longer term, the Secretary should direct the FAA Administrator to balance current and long-term investment priorities.
Agency Affected: Department of Transportation
Status: In process
Comments: We are awaiting documentation from FAA that can demonstrate how the agency has met this recommendation.
Recommendation: To position FAA to best meet NAS needs in both the near term, and the longer term, the Secretary should direct the FAA Administrator to use all available management tools and, after establishing a record of improved financial management, explore more fundamental changes that could provide greater financial management flexibility.
Agency Affected: Department of Transportation
Status: Implemented
Comments: GAO has removed FAA from its high risk list for financial management. FAA has submitted a reauthorization proposal that is based on a user fee approach in an attempt to better align the agency's costs and revenues, as well as an attempt to secure debt financing for some modernization investments. FAA has made a number of management changes to manage its finances and acquisitions in a more business-like manner and has institutionalized these changes.
