Thursday, June 2, 2016

Federal Aviation Administration Restructuring Is Grounded by Senate Opposition: Proposal to shift control of air-traffic control system to nonprofit corporation will likely stall, stopgap funding bill looms

Kathryn's Report:

The Wall Street Journal 
Updated June 2, 2016 8:25 p.m. ET

WASHINGTON—A bid by House Republicans to shift the federal air-traffic control system to a nonprofit corporation’s control has been sidelined by bipartisan Senate opposition, according to congressional staffers, airline industry officials and others participating in the process.

Continuing disagreements between senators and the Republican chairman of the House Transportation and Infrastructure Committee over a Federal Aviation Administration reauthorization bill have created a legislative logjam, these people said, likely to last until at least next spring or summer.

The anticipated result, according to interviews during an industry conference here, is that the agency will be hobbled with another brief, stopgap funding bill that all sides had hoped to avoid. Such an outcome would maintain the FAA’s basic spending levels and programs, while prompting uncertainty about new policy initiatives and leaving the agency without longer-term financial stability that would benefit its efforts to modernize the nation’s aging air-traffic control system.

A temporary extension also would be a blow to Rep. Bill Shuster of Pennsylvania, the House committee’s Republican chairman, who has maneuvered for nearly two years to pass a major restructuring of the FAA’s traffic-control network and its roughly 38,000 workers. His panel has adopted the sweeping structural and revenue changes, but the measure hasn’t reached the House floor. The Senate overwhelmingly approved a bill in April that doesn’t include any of those controversial provisions.

According to industry officials, the committee bill doesn’t have enough support at this point to clear the House.

In a presidential election year, according to industry officials on both sides of the debate, time is quickly running out to hammer out any compromise with the Senate. Current FAA legislation expires July 15.

Some of the most telling comments came from proponents of Rep. Shuster’s proposal, who acknowledged it was essentially dead for the short term. Paul Rinaldi, president of the controllers union and a supporter of the House measure, said in an interview: “I would be really, really surprised if anything other than an extension came out that pushed” reauthorization into early 2017. Given summer legislative schedules and the election, he added, lawmakers have only “a handful of days to try to resolve something.”

Gerald Dillingham, a senior Government Accountability Office official who hasn’t taken sides in the debate, acknowledged the same dynamics have run out the clock on the House position. “We’re not really thinking that this decision is necessarily going to come” in 2016, he told the conference.

The FAA’s leadership, whipsawed by draconian budget cuts and employee furloughs in previous years, has indicated it is prepared to live with a temporary extension. Unlike those earlier times, “we’re not really expecting a budget crisis,” Michael Whitaker, the FAA’s No. 2 official said during a speech to the conference Wednesday. “We’re in a relatively stable place” with regard to air-traffic upgrades, he said.

A staffer for Rep. Shuster said his boss “has not made a decision yet,” adding that his game plan will become clearer in the next few weeks. But according to people familiar with the chairman’s thinking, he has concluded that “a plain-vanilla extension” may leave him in a stronger position to resume the debate in 2017 and try to win converts than a longer extension incorporating various Senate proposals.

A spokeswoman for the major U.S.-airline trade association, which also has strongly backed Rep. Shuster, said “if we want to continue to have the safest air traffic control system in the world, we need to modernize technology and ensure the system can’t be interrupted by congressional budget impasses. We continue to believe this transformational change is necessary.”

Rep. Shuster’s call for dramatic restructuring has run into a barrage of criticism, including from groups representing commercial pilots, private aviators and business-jet operators—all of whom he unsuccessfully tried to woo with favorable treatment under the bill.

Bipartisan leaders of the Senate Commerce Committee in May urged the House to accept their bill, which beefs up airport security, promotes widespread use of commercial drones and streamlines certification of new safety systems for private aircraft. As of earlier this week, according to people familiar with the process, Senate leaders hadn’t focused on the likely length of the looming reauthorization measure or whether they would try to attach certain security and consumer-protection provisions to some other legislative vehicle.

A short term, uncluttered extension “keeps alive the only path forward for air-traffic control reform,” according to Roger Cohen, an industry consultant who previously headed up the trade association representing U.S. regional airlines.

“Congress likes to gripe about airlines, but only acts in crisis mode” such as a government shutdown or planes stuck on the tarmac according to Mr. Cohen, who added “the deck could get re-shuffled after the election.”

—Susan Carey in Chicago contributed to this article.

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