Transportation secretary Federico Peña has announced the administration's plan to scale back DOT from 10 agencies (including the Federal Aviation Administration, the Research and Special Projects Administration and the Coast Guard) and 104,000 employees to three transportation sectors and just 54,000 workers. The department is relying heavily upon the privatisation of the Federal Aviation Administration's ATC system, which would allow 40,000 workers to be taken off the government payroll.
DOT has been conducting a departmental survey headed by assistant secretary Mort Downey. Four task forces comprising more than 200 people have been considering ways of making the department more cost-efficient and productive.
Of two restructuring options, most attention is being given to a proposal that would break DOT into three modal administrations: aviation, surface and maritime.
Generally, aviation interests favour a downsized DOT, which has been the primary focus of mandated cuts by President Clinton along with other departments like Housing and Urban Development. However, a plan to give states block grants of federal funds for transportation projects - theoretically giving individual states more control over their infrastructural needs - is being resisted by the airlines.
Showing their federalist tendancies, carriers like Delta have complained that putting control over aviation infrastructure improvement projects in the hands of states would create a slew of new state aviation bureaucracies. 'The national system must not be eroded,' says Rex McClelland, Delta's senior vice president of corporate services. 'Decisions made at the state and local level must be consistent with the overarching national concerns regarding the expansion of the nation's airport and airways system.'
But, DOT argues, giving states more control will help lessen dependence on federal funds by providing seed money that 'state infrastructure banks' could then use to promote partnerships with local governments and private business. Though projects of 'national importance' would continue to be paid for from Washington, department planners see airports relying more on their own ability to raise money. Sources say that could involve allowing for a greater collection of passenger facility charges. In a more revolutionary vein, DOT is considering lifting the ban on airport privatisation, which is being seriously considered by Los Angeles (LAX) and New York (LaGuardia and JFK).
Still, there is a fear spreading throughout the airline and airport community over the federal government's level of commitment to use existing revenues supposedly earmarked solely for aviation projects for that purpose. Of specific concern is the Aviation Trust Fund, the multi billion dollar federal account that pays for ATC and the federal Airport Improvement Programme, and is supported primarily through user fees like the federal passenger ticket tax and cargo surcharges. In the past, the trust fund has accumulated unspent funds that were used to offset the US deficit.
Though DOT has vowed that 'the Aviation fund will only be used to pay for airport-related projects', there is a commonly held belief that it will be raided to help pay for a politically popular middle-class tax cut. The American Association of Airport Executives has set up a $500,000 'Airport Defence Fund' to campaign against federal pilfering of the fund for non-aviation uses.
This debate reflects concerns over a standard the Clinton administration established long ago: favouring corporate interests over small business interests. This failed in the 1994 healthcare debate, largely because corporate America could not support an administration it considered ideologically separate.
Meanwhile, with prodding from several quarters, the DOT has found money to continue funding the departmental office that analyses airline financial and operating data. The office of airline statistics of the Research and Special Programmes Administration (RSPA) will be funded this year, though what happens thereafter has to be decided.
An uproar of sorts occurred in November and December when nine aviation consultancies got together to complain that the quality of federally mandated data from airlines was suffering from the effects of department-wide cutbacks. Their campaign, focusing on financial and operating reports and the origin and destination survey, resulted in an investigation into late and lacking analyses. The consultants were later joined by airline interest groups and airlines.
Sources say that DOT has found $400,000 from the Federal Aviation Administration's budget to support the aviation statistical reports, which are heavily relied upon by the department's policymakers as well as most commercial airline interests. Though the requested appropriation had been $500,000, the lesser amount is enough to 'extend' the contracts of two of eight statisticians who recently took early retirement options.
However, yet to be answered is DOT's long-term solution to the question of where aviation statistical analyses should actually be carried out. It is expected that the department's restructuring will result in RSPA being closed. Its responsibilities may be given over to the economic analysis unit under the secretary, a move supported by many people in the department. However, sources say the aviation unit may also end up being privatised.
It is most important to the groups that use the information that the data collection be continued. When threatened with its termination, the desire to overhaul the sampling methodology and statistical analysis in an effort to make the data completely 'clean' may be receiving secondary consideration.
It is most important to the groups that use the information that the data collection be continued. When threatened with its termination, the desire to overhaul the sampling methodology and statistical analysis in an effort to make the data completely 'clean' may be receiving secondary consideration.
Source: Airline Business
