Moving On?

Late last year, Air Traffic Management magazine’s industry commentator Bob Poole considered what the November 8 election results could mean for reform of US air traffic control.

Election day produced the surprise result of populist Republican Donald Trump as president-elect and continued Republican majorities in both the House and Senate. In addition, the leading legislative advocate of ATC corporatization – House Transportation chairman Bill Shuster – was easily re-elected and plans to resume the corporatisation effort next year. Airline trade group A4A expects the Trump Administration to support the effort and controllers’ union NATCA remains supportive.

The question many are asking is whether this is mostly wishful thinking. Is there any evidence that the new Administration will be on board?

The Trump campaign was a lot less specific in its policy agenda than the Clinton campaign. Its three-page paper on infrastructure included in a long list of bullet points, ‘work with Congress to modernise our airports and air traffic control system, end long wait times, and reform the FAA and TSA’.

Much of the paper stressed the use of public-private partnerships and user-fee based financing to ‘transform America’s crumbling infrastructure’. A plan produced for the campaign by investment banker Wilbur Ross and economist Peter Navarro proposes a $1 trillion, 10-year infrastructure investment effort financed by the private sector based on user-fee revenue streams, with the aid of federal tax credits for the equity investors.

Intention

While that plan is focused more on highways, airports, and seaports, it shows a clear intention to not base infrastructure modernisation on large increases in federal taxes or spending. A self-funded ATC corporation is consistent with all that.

Another clue is that the Trump campaign has had a fully staffed transition team in operation since September, with team leaders for every major federal agency. These people are drawn from think tanks, law firms, financial firms, etc.

The identities of the team leaders were revealed by Politico the day after the election. Heading the team for the Department of Transportation is my former Reason Foundation colleague, Shirley Ybarra. She was a special assistant to DoT secretary Elizabeth Dole during the Reagan Administration, and one of her projects was the successful effort to remove Washington National and Dulles Airports from the FAA and convert them into self-supporting, bond-financed airports.

In the 1990s, she was secretary of transportation for Virginia, where she introduced the successful Public-Private Transportation Act that has produced four highway mega-projects thus far and has served as a model for other states. Shirley was also a member of the Business Roundtable task force on ATC reform.

Appointment

The transition team is an encouraging sign, but a great deal will depend on who gets appointed as secretary of transportation. If the new secretary’s mandate includes getting the ATC corporation through Congress, that will make a big difference.

The current FAA administrator, Michael Huerta, has a fixed term with one more year to go. FAA’s authorisation – the act of Congress that defines its priorities and authorizes its budget and the taxes that support it – expires next September 30. So a new FAA bill is a key priority for the new Congress.

None of the above guarantees that ATC corporatisation will happen. The 2016 attempt got no farther than party-line approval by Shuster’s committee in February. Government employee unions other than NATCA made opposing it a litmus test for Democrats. The business jet people organised a fear campaign among private pilots, small-city airports, and rural legislators, portraying the reform as major airlines taking over the ATC system that would likely reduce or eliminate ATC service such as control towers at small and rural airports. These opponents will be back in force in 2017

Concerns

Because concerns about private pilots and rural areas cut across party lines, the coalition working for ATC corporatisation will have to be expanded and made bipartisan – and do a much better job explaining what the proposal is and is not. A key to doing this will be active participation by veterans of the Clinton/Gore Administration’s reinventing government effort, one of whose major projects was ATC corporatisation – the proposed self-supporting, stakeholder-governed US Air Traffic Services corporation.

That effort had the support of DoT secretary Pena and FAA administrator David Hinson, and nominal support from NATCA. But it died in Congress because it was seen as a solution looking for a problem to solve.

Today there is bipartisan concern that FAA’s funding is insecure, its facilities are obsolete, and its NextGen modernisation is lagging behind its counterparts in other countries. And today there are more than 50 corporatised ANSPs with established track records, rather than the handful of startups in existence 20 years ago. So the case, on the merits, is far stronger than it was in 1995.

At the Transportation Research Board symposium on ATC reform in July 2015, former DoT undersecretary for Policy Jeff Shane reminded attendees that government is capable of changing. He cited airline deregulation in 1978 and Open Skies agreements in the early 1990s as examples. And he suggested that the time may be right for major institutional reform of ATC today. We will find out in 2017.

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