The Federal Aviation Administration (FAA) is having a difficult time monitoring and inspecting most of the regional carriers since it implemented the Air Transport Oversight System (ATOS).

The FAA has 585 inspectors for 16 airlines covered by ATOS and 1,100 inspectors covering 99 large low-fare, regional and cargo carriers. That works out to an average of 36 inspectors for each ATOS-covered airline, and 11 inspectors on average for each National Work Program Guidelines (NPG)-covered airline.

The impact of budget cuts is hurting the FAA's inspection program, according to a new Government Accountability Office (GAO) 48-page report, Aviation Safety: System Safety Approach Needs Further Integration into FAA's Oversight of Airlines. ATOS is the system of continuous safety surveillance that is in place at the larger airlines, including four regional carriers, but which has not yet been implemented for almost 100 operators that carried about 200 million passengers in 2004 and that represent the fastest- growing segment of the industry. The safety of these carriers is assessed through the NPG, but the FAA hopes that it will provide more effective oversight when these operators are moved to ATOS in 2007.

It is generally recognized that ATOS takes more FAA inspectors to manage than NPG, yet the transitioning of more airlines to ATOS is occurring at the same time as the FAA inspection workforce is projected to decrease. Among the FAA inspectors assigned to the non-ATOS carriers, the workforce is projected to decline by 195 inspectors per year.

Pending the transition of all carriers to ATOS, the FAA says it will consider the GAO's recommendation to strengthen the Surveillance and Evaluation Program (SEP), which might be likened to a halfway house on the road to full ATOS implementation.

ATOS was developed after the ValuJet crash in 1996. It represents a system safety approach that extends beyond periodically checking the airlines for compliance. Initially implemented for 10 major carriers in 1998, the ATOS program has since been expanded to 14 carriers, including two cargo operators. When the program expanded by four more carriers, the total size of the inspection teams grew by 30 percent, from 73 to 95 inspectors. For example, SkyWest [SKYW] had 20 inspectors under the SEP program, but it now has 30 inspectors under ATOS.

Growing ATOS to cover the rest of the fleet by 2007 may not be realistic, the GAO report says. For one thing, the FAA has only "recently established" the goal of such expansion.

Secondly, there is a shortage of people to oversee the non-legacy airlines due to attrition, "workload shifts," and a hiring freeze on replacements. "In 11 of the 13 FAA field offices that we contacted, officials indicated a shortage of different types of inspectors needed to oversee the non-legacy airlines, which has sometimes resulted in inspections being delayed or eliminated," GAO said.

The inspectors the FAA does have cite lack of training as a major problem. One way around this is to accept free training by the manufacturers. "The FAA has established safeguards to help preclude the appearance of a conflict of interest when [the] FAA accepts training from the entities it regulates," GAO said.

Nevertheless, the FAA's oversight problem seems to be the product of staffing shortages and the late commitment to ATOS.

>>The full GAO report: http://www.gao.gov/cgi-bin/getrpt?GAO-05-726.<<

ATOS Regionals*

• American Eagle
• ExpressJet
• SkyWest
• Trans States

Non-ATOS Regionals*

• Atlantic Southeast
• Mesa
• Independence Air
• Air Wisconsin
• Pinnacle
• Horizon Air
• Chautauqua
• Mesaba
• Midwest Connect
• PSA
• Piedmont

*Regional carriers among the 25 largest non-legacy carriers ranked by 2004 enplanements.