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Monday, August 25, 2008

Commentary: FAA Does Not Trust Itself

Kathryn B. Creedy

As the Federal Aviation Administration faces more Congressional questioning of its oversight programs, one of the alphabet soup groups has actually quantified the FAA’s lack of standardization actually costs just one part of the industry.
The aviation industry has long known that FAA inspectors and their superiors in various district, field and regional offices disagree about the exact interpretation of the Federal Aviation Regulations, something experienced by the regional airline industry in the 1980s which resulted in the loss of some of its largest airlines.
But now, the National Air Transportation Association has loosely quantified the cost in the hundreds of millions of operator dollars. It is taking the FAA on and is asking for Congressional help, requesting Congress call for a GAO report to review fully how much inconsistent regulatory interpretations are costing the FAA and the aviation industry millions of dollars in resources and raising serious concerns about unified safety standards.
Its approach is a critical signal of what is wrong with FAA oversight on any number of levels and should be supported by every aviation interest because making the FAA more efficient and the rules clearer is in everyone’s interest.
“Inconsistent and varying interpretations of compliance are not only costly for the industry, they also demonstrate a shortcoming in the FAA's ability to coordinate its workforce and ensure that the decision-making abilities vested in inspectors are respected across all divisions of the agency, impairing efforts to achieve a uniform safety standard nationwide,” said NATA in announcing the results of a survey of members. (See sidebar below)

Cautionary Tale
The implications of FAA’s scattershot method of enforcement and oversight go far beyond the occasional suspension or revocations of an operator’s license and have been known for 20 years, which makes the NATA effort so critically important.
In addition to costing the industry dearly, the survey clearly signals that FAA does not trust itself, although most of us suspect this has more to do with CYA than in any actual safety goal. Second, operators are not the only ones paying dearly since it is the taxpayers who pick up the tab for the duplicate efforts of FAA offices to approve the same application or to ensure operators are in compliance. I know the safety of the aviation industry is built on redundancy, but this is not only ridiculous it is one of the major barriers to making FAA the efficient and business-like organization that the industry has been calling for.
While the duplicative efforts may serve an excess of caution, especially with respect each FAA entity covering its own back, it certainly does nothing to foster operator trust or even confidence that the FAA is able to effectively carry out its prime directive – aviation safety.
The FAA may say that it knows the cost of serving the different aviation segments as far as air traffic control is concerned, it can’t possibly know its actual costs because it is highly unlikely that the cost of duplicate FAA rulings on a single application is figured into its overall business costs. This becomes more important as the industry screams for the FAA to do what industry has done – streamline to reduce costs – just as every aviation entity has done in the past several years.
Yes, I know we are talking about a bureaucracy here but it is hardly an excuse when the government turns to industry to fund its pet projects and pressure comes every year to reduce the amount of general funds dedicated to the FAA. Every security, airport and aviation fee amounts to a tax and prompts the question of what the taxpayer is paying for if not to run the government and, just as important, how much tax can a passenger take. It should also prompt the industry and passenger groups to say it will no longer be the government’s ATM machine until crucial changes are made. That may be easier said than done, but at least NATA is making a start by highlighting FAA’s inefficiency and its impact on aviation safety.
Far from being an excuse, we know this particular bureaucracy can change as evidenced by the reforms implemented through the development of data and information sharing programs that have transformed aviation safety from a learn-from-accidents environment to a pro-active, data-driven methodology designed to avoid accidents in the first place. Related Story These programs have been lauded by operators and the alphabet soup groups, including NATA, as not only catching negative safety trends but in helping operators find more efficient ways of doing business that further enhances safety. Now all FAA has to do is turn the tables on itself and find more efficient ways to determine operator compliance that not only enhances confidence it is abilities but streamlines its services and cuts costs.
Of course there is the argument that cozy relationships between local FAA offices and those they oversee lead to critical compromises in aviation safety as evidenced by the Southwest and American violations this spring. Certainly that is a concern, but the data and information sharing programs indicate such concerns can be overcome when industry and regulators work together to achieve a common goal.
This is not a new problem since the same treatment now being experienced by charter operators was given to another burgeoning segment of the aviation industry – the regional airline industry of the 1980s. The same charge about differing FAR interpretations was made then and even led to the failure of some of the industry's major players. Seemingly, 20 years has done little to make the FAA realize anything more than to let the political storm pass so it can go back to business as usual as soon as it flexes its muscles enough to indicate that, after all, it may be doing its job. While FAA may be sanguine about such controversies, it does nothing to improve aviation safety except to provide more window dressing and ignores a huge opportunity to change things for the better.
The industry talks of FAA reform largely in the context of its failure to modernize the ATC system, but the reform needed goes much deeper as suggested by NATA and really indicates a need to review the very nature of how the industry has changed and FAA’s role in safety oversight in light of those changes. No, this is not a new thought, but NATA’s efforts create an essential movement everyone should join.

NATA Survey
The lack of a standardized interpretation of the Federal Aviation Regulations is one of the biggest worries on the minds of the general aviation industry, according to a survey released recently by the National Air Transportation Association. In fact, trying to please the nine FAA regionals, 10 aircraft certification offices and 80 flight standards district offices that issue approvals on a wide range of maintenance and operational requests, is creating a huge burden on the industry, costing hundreds of millions of dollars annually when previously approved actions are subject to re-interpretation. Perhaps what it indicates most is the lack of efficiency in the FAA which cost taxpayers dearly and really indicates that the FAA does not trust itself.
The NATA survey captures specific examples from membership of how the lack of standardization within the FAA has affected their aviation business and is destined for a report to Congress on the magnitude of loss these re-interpretations have caused the general aviation industry.
The results of the survey showed:
• 89 percent of NATA members responded that their businesses have suffered owing to inconsistent regulations.
• Affected aspects of aviation businesses included aircraft (30 percent), operations (35 percent) and approval of manuals (35 percent).
• 81 percent stated that lack of standardization is the result of the FAA’s reluctance to accept prior approval.
• Seven percent of NATA members reported waiting at least 30 days to resolve a discrepancy with an FAA regional office; 20 percent waited 30-60 days; 19 percent waited 61-120 days and 51 percent waited 121 days or longer.
• Most importantly, the report highlighted that significant financial loss resulted, $10,000 to over $2,000,000 in costs, not including legal fees, owing to instances such as delayed Minimum Equipment Lists approvals.
• Examples of lack of standardization include a Part 135 on-demand air charter operator who spent approximately $25,000 to secure FAA approval to move an aircraft on his air carrier certificate from one FAA region to another. First, the operator demonstrated compliance with FAA officials from the region where the aircraft was based. The operator then had to work with FAA officials in the region to where the aircraft was being moved as its new base location. The new FAA office would not accept the determination of compliance from the original FAA office and insisted that the operator again demonstrate that the aircraft was in compliance with the FARs. The aircraft was out of service and unavailable for customer use for more than five weeks, at a cost of more than $200,000 in lost revenue to the operator.
• As another example, an NATA member Part 145 repair station was informed by the FAA that the region with responsibility for oversight of the repair station would be changing. The NATA member company endured a lengthy, costly process as the new region with jurisdiction decided to reapprove the repair station's manual, used to prescribe performance of maintenance functions, and identified more than 75 "deficiencies." The manual had been deemed to be fully compliant with all FAR requirements and approved by the first FAA region, but the new region insisted that revisions be made according to its interpretation of the regulations. This drawn out process cost the repair station countless hours of employee time and hundreds of thousands of dollars in lost revenue while it implemented the new region's revisions.
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