Hillary clinton continues hir visit today in cedar fall. Shes taking part in a roundtable discussion on Small Businesses and lending. And live coverage this morning on capitol hill the Senate Transportation committee holding a hearing on reauthorizing faa programs, focusing on modernizing the air Traffic Control system. The administrator of the faa is michael werta. Well be hearing from him as national air Traffic Controller associations president and others. The chair arrived. South Dakota Republican john thune. Youre watching live coverage on cspan3. This hearing will come to order. Good morning. The Commerce Committee concludes the series of planned hearings on reauthorization of the federal Aviation Administration with an examination of the nations air Traffic Control system. Let me begin by thanking aviation subcommittee chair and Ranking Member for taking us through several valuable hearings on the way to this full committee hearing. Its been a busy work period and a great deal of progress has been made thanks to their efforts. Usair Traffic Control oshgs atc system involves thousands of dedicated air Traffic Controllers guiding flights across the country on daily basis. We can proud of the safety record. At the same time increasing demand, the need to improve efficiency and changes in technology all underscore the need to modernize a system that is still radar based and operated using concepts and procedures developed decades ago. Efforts to modernize hardware and software made progress recently with the long view indicates modernization programs often taken too much time and cost too much. We have stacks of reports from the dots office of Inspector General and the Government Accountability office detailing the implementation delays and cost overruns that have plagued the efforts for decades and stimied leadership for multiple administrations. The initiative in this area is the next Generation AirTransportation System. Before nexgen was given a name it was free flight. It was expected to result in the genuine trance formation of the system away from air Traffic Control to air traffic manage management taking advantage of gps for navigation was at the heart of this idea. Faa would save money eliminating most radars and airspace operators would save time money and fuel by choosing their own direct routes. But more than 15 years after the faa began talking about free flight, we still seem to be more than a decade away from anything resembling it. A recent study by the National Research council concluded that the nexgen is more about incremental programs and improvements rather than a transformational change r change. Airlines and other operators in the system feel burdened with the expense and effort of implementing change thats wont yield direct benefits for them for many years to come. This situation is led several stake holders and policy makers to question whether the current atc structure is best suited for the task at hand. Long standing difficulties with modernization of just one reason to consider reform. The systems reliance on annual transportation appropriations and the vague riz of the political process make long term planning for system capitalization management of the footprint difficult and more costly. And the faa will always face challenges attracting and retaining the talent needed to drive major change when it must compete with cutting edge businesses in the private sector. To address the challenges we must consider if there is a better way to deliver atc services for the traveling public and airspace users. And im open to considering all ideas. Faa has a great record as a safety regulator, something that would certainly continue a fair traffic considering Services Removed out of the faa or government. Many countries arent world have undergone such transitions with success. I look forward to hearing from our Witnesses Today about what reform of our system might look like and how reform could serve the needs of all airspace users. To be sure, the matters we discuss today are part of a larger effort on faa reauthorization where well address a host of other important issues. Im looking forward to working with Ranking Member nelson as other members of the committee to advance such legislation. Lastly, i want sto stress our interest about atc modernization are not focused only on the Current Leadership Team at faa. As i mentioned before it seems clear there are limitation thats impede success over the years. I suppose the key question is whether if we were to build an air Traffic Control system from scratch today, would we necessarily conform to the old structures or strike a better path . I look forward to this discussion. And now i want to turn to my colleague senator nelson Ranking Member, for his opening remarks. Thank you, mr. Chairman and senator thune. He joins me to acknowledge those lost and the flight 3407. Your presence here is a reminder of how much is at stake with the safe operation of our Aviation System. We have the most kblechl airspace in the world. The faa employees, we have an agency that is providing the safest, most efficient airspace in the world. Yet the negative impacts of the uncertainty of the funding and the sequestration have led to widespread concerns about the funding of federal programs and the federal operations. If you take a meat cleaver approach instead of the scalpel approach the sequester forces irresponsible budget decisions and our domestic and defense programs. Now some of you are going to suggest that the answer is to privatise how the faa and air Traffic Control. This senator feels like we out to get budget certainty and repeal sequestration. If we do not, the situation will worsen when additional budget cuts return in 2016. The faa has faced unpredictability for too long. The last faa bill took four years and involved 23 extensions and a partial faa shutdown. Now the good news is that senator thune and i working together, were going to do Everything Possible to get this faa reauthorization gone. The faa has had to furlough employees implement a hiring freeze temporarily close their academy and halt a lot of the work that ive had the privilege of seeing with the administrator on the nexgen programs. This is set the faa back in its progress to advance air Traffic Control modernization. So the conversation about moving air Traffic Control into private, not for profit entities has impact far beyond you witnesses here today. They control airspace with the faa and they have for more than 65 years. Today the department of defense controls about 20 of our airspace. For civilians as well as the military. Faa and dod coordinate activities to ensure our military can train war fighters test new concepts, equipment, and defend the nation. Air defense right here in the continental u. S. No other country in the world has the defense assets of the u. S. And we must ensure that our defense interests are not harmed by removing the government from air Traffic Control. I can tell you the department of defense has visited me and they dont want any of this privatization. Well, look at the airlines. Even the airlines are not in agreement. Let me quote from a letter from delta. Rather than wasting months of collective energy only to find ourselves with a less sufficient less responsive, more bureaucratic like costlier, new Monopoly Service provider, we should instead focus our efforts on achieving real reform in the next authorization that brings about tangible benefits for operators and more importantly for the traveling public. Thats delta. So since aviation is the backbone of our u. S. Economy we must prioritize air Traffic Control investments for the good of this country. Thank you, mr. Chairman. Thank you. We have a great panel today led off by the honorable michael huerta. Hell be followed by the honorable john engler, president and Business Roundtable and former governor. The honorable byron dorgan, former colleague of ours from the other dakota. And also a former member of this committee. And mr. Jeff smisek, paul renaldi, and mr. Ed bolen. So a great panel. We look forward to hearing from all of you. Well start on my left and your right with the administrator, mr. Huerta. Please proceed. Thank you. Members of the committee, thank you for inviting me to speak today about the reauthorization of the faa. The upcoming faa reauthorization provides us with the opportunity to propel our system to the next level of safety and to foster the kind of innovative climate that is long been the hallmark of our proud aviation heritage. This reauthorization is provided a forum for many an industry and government to openly discuss possible changes in the governing structure of the faa to help us create the Aviation System that will sustain our nations Economic Growth well into the future. Were open to having this discussion. But we must all agree on the most important problems reauthorization should fix. In our view those are budget instability and the lack of flexibility to execute on our priorities. These challenges exist for the entire agency, not just for the air Traffic Control system and the nexgen organizations. In addition to finding the agreement on the problem were trying to solve we should agree on finding ways to avoid unin unintended consequences. That hinges on relationships within the agency. Nexgen is more than installing technology in our air traffic facilities. It involves participation of our Safety Organization to ebb sure that the technology is safe and the controllers and pilots know how to use it safely. We believe that any discussion about governance must take into account the issues so that we may best serve our nation and the flying public. Some of argue for change saying it is not delivered on air traffic modernization. I argue that the faa already made major progress in modernizing our airspace system through nexgen. We completed the installation of a more powerful Technology Platform with the new High Altitude control system. The system will accommodate the applications of nexgen and allow controllers to handle the expected increase in air traffic efficiently. And last year we finished the coast to coast installation of the network that will enable satellitebased air Traffic Control. On a parallel track, through our collaboration with industry, we identified key priorities and implementing the procedures. We now have more satellitebased procedures in our skies than traditional radarbased procedures. We have created new nexgen routes above our busiest areas saving millions of dollars in fuel decreasing Carbon Emissions and cutting down on delays in each city. In addition to these improvements, we set clear priorities on delivering more benefits in the next three years. These range from improved separations standards for heavy aircraft, better coordination of traffic on the airplane surface, and streamline departure clearances using data communications. Nexgen yielded 1. 6 billion in benefits to airlines in the traveling public. In the next 15 years, the changes we have already made will produce 11. A 11. 5 million in benefits. Thats why we go back and study the benefits that certain improvements provided to users. For example, in atlanta, we safely reduced wake separation standards to improve efficiency at the airport. Because of this change, atlantas Heartsfield Jackson International airport increased number of planes it can land by 5 or about five planes more per hour. Delta is saving two minutes of taxi time per flight. The improvements are saving them between 13 million to 18 million in operating costs annually. Were aware of the implementation of nexgen. There are different theories about how to Deploy Technology if a complex operating environment. Some take the position that you should start from a wideranging vision and work back from there on developing a range of scenarios. Others suggest mapping out the entire picture and only proceeding when youre sure of the end game. Others say take a more pragmatic approach and this is the path that faa has chosen based on close consultation with industry. This approach used by the office of management and budget manages them to airlines and passengers. We acknowledge it requires up front investment but careful not to strand framz in theprograms. When dealing with widespread change and die namic airspace system, there is no margin for error. The system must transport 7 auto million passengers every year with the highest levels of safety. Any technology we implement must be reliable and safe from the outset. To achieve this high standard, we must remain nimble and we must have flexibility. Our Aviation System is a valuable asset for the american public. We should use the upcoming reauthorization to provide the faa with the tools necessary to meet the demands of the future and to minimize disruption to the progress weve already made with nexgen and to intergrate new use nears the airspace system. I thank you for the opportunity to appear today. Im happy to take your questions. Thank you. Here we go. Every one of the members relies on air transportation as a customers cargo and passenger airlines. Thert largest they are the largest system. Sadly are we lost our position and our future leadership is in doubt. The usair traffic system remains the largest worlds safest and it is not the most technologically advanced. The system relies on the same technology, ground based radar. The technology is still analyzed. They have the pace of modernization and represented by the faas nexgen situation. This month clearly stated the problems. The original vision for nexgen is not implemented today. Its offered for nexgen. A modern innovative air Traffic Control system would offer tremendous benefits to the usersst airspace. They lower emissions. It is Small Community airports. So what are the obstacles . Last year my seat mate here, faa administrator huerta offered an explanation at the Aerospace Club of washington. There is no wait faa can implement nexgen, recapitalize our aging infrastructure. That is something that the senator referred to in the opening comments. I would agree i believe on this critical point that current funding system clearly does not provide the needed resources. But a deeper problem is with the budget airy process itself. Stepbystep Technological Improvement that standard. Four generations of Cellular Technology from basic flip phone to 4g streaming videos and todays modern iphone are adopted. The faa is trying to fund a 20 billion capital modernization effort on an annual and unpredictable cash flow. Most sectors issue Revenue Bonds to finance Large Capital modernization. But bonding is something the faa cannot do. States do it. Private sector does it. The forecast government does not. I convened at the roundtable an expert group to help study this issue including the faa Department Officials and knowledgeable aviation policy advisors. Their conclusion, the status quo is simply too costly, too inefficient. They identified the necessary elements of the alternative system. Separation of the air Traffic Control operator from the regulators to improve transparency and accountability and to further increase safety. An organizational structure that accounts for multiple objectives so that safety and access are valued along with cost efficiency. Governance of the air Traffic Control by a board of 25 stake holders. A revenue structure that enables air Traffic Control to be selfsupporting without government Financial Support and completely free of the federal budget airy process. They accelerate modernization. Wage and benefit structures to protect employees, prevent disruption of employee reasonable career expectations and preserve a collaborative culture. Over the last two decades, most other western countries have restructured the way air Traffic Control is funded and governed. Determining that its a hightech service business, part of Critical Infrastructure that can be funded directly by the aviation users and customers separating air Traffic Control into an independent from the rest of the faa is of manageable process. Tools exist to address the problems that come with innovation and this is necessary. In the end, i hope you use the reauthorization process to put america on a trajectory to a modern air Traffic Control system that is again the Gold Standar