IT a big reason Congress is pondering a private air traffic control system

The Federal Aviation Administration is facing calls in Congress and from stakeholders to privatize key functions, in large part because of the failure of the government to field NextGen, the planned $40 billion satellite-based modernization of the air traffic control system.

"Efforts to modernize [air traffic control] hardware and software have made some progress recently, but the long view indicates modernization programs have often taken too much time and cost too much," Sen. John Thune (R-S.D.) said at a May 19 hearing of the Senate Commerce Committee.

One proposed solution that has been gaining traction is the possibility of spinning air traffic control off from the FAA into some other kind of organization that is not subject to annual appropriations. "The system’s reliance on annual appropriations and the vagaries of the political process make long-term planning for system capitalization and management of the agency’s footprint difficult, and probably more costly," Thune said.

Other countries have privatized or created new government-supported entities to carry out air traffic control functions. Australia, Germany and New Zealand use government corporations. Canada, the world's second-largest system after the U.S., uses a nonprofit cooperative, and the United Kingdom operates a public-private partnership.

While the safety record of the FAA-operated air traffic control system leads the world, stakeholders are concerned about the slow pace of technological upgrades. Reports from the Office of Inspector General at Transportation and the Government Accountability Office have bemoaned the slow, uncertain pace of NextGen implementation. A May 1 report from the National Research Council said that "NextGen, as currently executed, is not ... broadly transformational." The report found that the system "has not been significantly changed to take advantage of available information and communications technologies."

At the hearing, FAA Administrator Michael Huerta said that NextGen has had some recent successes, including the deployment of the En Route Automation Modernization (ERAM) system, which expands the number of aircraft that can be tracked by the system, and expands the range of individual controllers. However, Huerta also noted that funding has been unpredictable in recent years because of sequestration and the reliance on continuing resolutions to fund government agencies.

But large-scale modernization projects like NextGen pose particular problems for appropriators in the best of times. Former Michigan Gov. John Engler, who heads the Business Roundtable, told senators that "what the FAA is trying to do is to fund a $20 billion capital modernization effort out of annual and unpredictable cash flow."

A new report from the Eno Center for Transportation advocates shifting air traffic control functions to a new independent entity, either a government-backed corporation or a non-profit. The new entity should have budget independence, borrowing authority, be funded by its users, and governed in a way that is responsive to airlines, travelers and airport authorities.

Former Democratic Sen. Byron Dorgan, who co-chaired the group that wrote the Eno report, told the committee that "I honestly think it is triumph of hope over experience to believe that the funding issue is going to change. ... You cannot build what we want to build for this country and retain the leadership opportunities in this critical area of technology of air traffic control with this approach."

The Senate is in the midst of considering a reauthorization of the FAA. On the House side, Rep. John Mica (R-Fla.) has introduced a bill that would create a private entity to handle air traffic control.