Airline scheduling that has replaced mainline aircraft with regional jets prompted the adoption of arrival limits at Chicago's O'Hare International Airport which the Federal Aviation Administration (FAA) extended for another two years. The FAA last week published its final rule limiting arrivals to 88 scheduled arrivals per hour and no more than 50 scheduled arrivals in each half-hour period. The final rule, in force between 7:00 a.m. through 8:59 p.m. Central Time, Monday through Friday, and 12:00 p.m. through 8:59 p.m. Central Time on Sunday, also adopts the higher limit of 98 arrivals during the 8:00 p.m. hour but amends the half-hour limit in that hour to 50 scheduled arrivals. The new rule is effective October 29, 2006 and expires October 31, 2008.

The rule, an interim measure against the completion of parts of the O'Hare Modernization Plan (OMP) which would eliminate the need for such restrictions, is estimated to save $475.6 million in present value dollars including $212.7 million in total airline delay costs and $262.9 million in passenger delay costs. Phased implementation of the OMP will provide incrementally increasing operational benefits. The FAA's analysis projects that the addition of the first new runway will, by 2008 when the final rule expires, allow the airfield to accommodate over 50,000 additional forecast operations with an average annual delay per aircraft no higher than exists today. With the completion of Phase 1, the airfield will accommodate, by the 2010 time frame, approximately 90,000 additional forecast operations (over today's activity level) with a decrease in average annual delay per aircraft approximately 33 percent below today's delay per aircraft at O'Hare. Finally, with the completion of Phase 2 in 2013, the airfield will accommodate approximately 1.12 million annual forecast operations (an increase of more than 140,000 annual operations over today's activity level) with an average annual delay per aircraft nearly 70 percent below today's delay per aircraft.

Until July 2002, the FAA managed congestion at O'Hare with the High Density Rule (HDR). In 2000, Congress relaxed the slot rules at high density airports and phased out the specific regulations then in place at three of them, including O'Hare. With O'Hare, Congress directed several exemptions be granted, including for airlines providing air service to small airports with 70-seat or smaller aircraft.

While the HDR expired in June 2002, by 2003, American (AMR) and United (UAUA) had added a large number of operations and retired other flights, resulting in congestion during peak hours of the day, largely owing to the fact that many of their flights had been replaced by 600 regional jets, which, contrary to the exemption, went to medium and large hubs.

The RJ factor has played a big part in congestion. A study of the OAG from June 2006 revealed regional jets accounted for over 50 percent of operations at O'Hare, Cincinnati, Charlotte, Houston, Salt Lake, Washington Dulles and Cleveland and accounted for more than 30 percent at Atlanta, Dallas/Fort Worth, Philadelphia, Newark, Detroit and LaGuardia. Ironically, regional operators have also been complaining about delays and other operational problems, which they indicate is costing them millions of dollars as they miss performance goals, thereby reducing the compensation from their major partners.

From April 2000 through November 2003, American increased its scheduled operations at O'Hare between noon and 8:00 p.m. by nearly 10.5 percent. Over the same period, United increased its operations by over 41 percent. During the peak period, these two carriers added 375 regional jet operations per day. Overall, American and United added over 600 RJ operations per day. At the same time, they reduced mainline jet operations, resulting in an overall drop in capacity of more than 5.5 percent each, while flights increased by an average of 150 per day. In November 2003, more than 40 percent of American's and United's O'Hare flights were operated with regional jets. The significant increases in scheduled operations during this period resulted in excessive delays and congestion at O'Hare.

By November 2003, O'Hare had the worst on-time performance of any major airport. O'Hare arrivals were on time only 57 percent of the time, well below the FAA goal of 82 percent. Departures were little better. They were on time only 67 percent of the time, well below the average of 85 percent at other major airports.

O'Hare is not the only airport facing increasing congestion. In fact, growing congestion has prompted the agency to look at other delay-prone airports. However, it recognizes there is no one-size-fits-all congestion solution. Even so, it views O'Hare as a special circumstance. Delays there impact the entire system, while delays at other airports do not carry the same ripple effect.

The FAA and Department of Transportation (DOT) continue to evaluate market-based mechanisms, such as auctions or congestion pricing that may improve on prior methods of allocating available capacity at constrained airports. They are also conducting research with the National Center of Excellence for Aviation Operations Research (NEXTOR), in conjunction with various air carriers and the Port Authority of New York and New Jersey, on options to manage demand at LaGuardia in preparation for the expiration of the HDR at that airport. Even so, a market-based approach represents a much longer-term option that is not needed at O'Hare, given its expansion plans.