PRESIDENT CLINTON ANNOUNCES ACTIONS TO IMPROVE
AIR TRAVEL FOR AMERICAN CONSUMERS
December 7, 2000
President Clinton today will announce three actions to reduce airline
delays and improve air travel for America: an Executive Order directing
the Federal Aviation Administration to create a performance-based
organization to focus solely on efficient operation of the air traffic
control system; appointment of a group of business and labor leaders from
outside of the aviation industry to serve as a board of directors for this
organization; and a review of impediments to congestion pricing at
airports. Joined at the White House by the Secretary of Transportation,
the Administrator of the Federal Aviation Administration (FAA), and the
editor of National Geographic Traveler, a consumer travel magazine, the
President also will call on Congress to reform the way air traffic control
services are financed.
CHALLENGES TO OUR AIR TRAVEL SYSTEM. Our nation has the safest air
transportation system in the world, but air travel is no longer as
efficient as it is safe. The recent, explosive growth in air travel is
straining the limits of the air traffic control system operated by the FAA
as well as the runway capacity at key airports. Flight delays and
cancellations have soared, costing passengers and airlines billions of
dollars and contributing to widespread passenger frustration and anger.
To address this problem, the FAA must be structured to manage the
high-tech, high-demand operations of a 21st century air traffic control
system. As 24/7 service provider, the air traffic system in some respects
is more like a business than a typical government activity. It should
operate with a clear mission, measurable performance goals, and
identifiable users. The Clinton Administration has worked with the
Congress to provide the building blocks of a more efficient air traffic
control system, including flexibility from federal personnel and
procurement rules. Today?s action by the President builds on these steps by
creating a distinct management unit for the air traffic system ? the Air
Traffic Organization ? and giving it the incentives and tools to operate
more flexibly and efficiently. The FAA Administrator will continue to
regulate the air traffic sytem to ensure that it operates safely and
securely, as well as efficiently. At the same time, because it is freed
from the day-to-day operational concerns of air traffic, the rest of the
FAA will be able to focus its energies on leading our aviation system at
large.
PRESIDENT CLINTON WILL TODAY ANNOUNCE STEPS TO REDUCE AIR TRAFFIC CONTROL
AND AIRPORT DELAYS. To accelerate efforts to reduce delay and improve air
travel for consumers, the President will announce the following steps:
? Executive Order Directing FAA to Create a Performance-Based Organization
to Make Air Traffic Control More Efficient: The President is issuing an
Executive Order directing the FAA to create a ?performance-based
organization? -- the Air Traffic Organization -- to manage the operation of
air traffic services. It will be located within the FAA, but will be
separate from, and overseen by, the FAA's safety, regulatory and
enforcement arm. Establishment of this new organization is a major step
towards development of a 21st century aviation system.
The new organization will be devoted exclusively to its ?core business? ?
the delivery of air traffic control services. It will be managed by a
Chief Operating Officer, who will be hired through a nationwide competitive
search; the COO will negotiate a performance agreement with the FAA
Administrator and be paid partly based on performance. In collaboration
with its customers (airlines and other air traffic control users), the
organization will set clear performance goals, which will be spelled out in
a performance agreement; using agreed-upon indicators, customers can
measure the organization?s performance and hold it accountable.
? Designation of Business and Labor Leaders to Oversee Air Traffic PBO:
Secretary of Transportation Rodney E. Slater is designating five
distinguished individuals for appointment to the Air Traffic Services
Subcommittee of the FAA's Aviation Management Advisory Council. Congress
created the five-member Subcommittee in recent legislation. It will
function as a board of directors, overseeing the management and budget of
the Air Traffic Organization and ensuring that it becomes more
customer-driven and performance-based. The designees are:
? John J. Cullinane, President, The Cullinane Group
? Nancy Kassebaum Baker, former U.S. Senator from Kansas
? Leon Lynch, International Vice President, United Steelworkers of America
? Sharon Patrick, President and COO, Martha Stewart Living Omnimedia, Inc.
? John W. Snow, Chairman, President and CEO, CSX Corporation
? DOT/FAA Federal Review of Impediments to Airport Congestion Pricing:
The President is directing the Department of Transportation (DOT) and the
FAA to review the statutory and regulatory impediments to the use of
congestion pricing and other market mechanisms to provide for more
efficient use of existing runway capacity and encourage the creation of new
capacity. For instance, charging airlines more to land at airports during
peak hours could reduce congestion and delays. The FAA is already looking
at options for congestion management, including market mechanisms, to
reduce delay at LaGuardia Airport. DOT and FAA should expand that effort
and seek statutory relief where appropriate.
THE WHITE HOUSE WILL RELEASE A REPORT OUTLINING NEED FOR A NEW AIR TRAFFIC
ORGAN IZATION. The White House report outlines the challenges facing the
aviation system, the steps the FAA has taken to address them, and the need
to create an a new performance-based organization to operate the air
traffic system more efficiently.
CONGRESS MUST TAKE ADDITIONAL ACTION. These Executive actions, building
upon current reforms within the FAA, are necessary but not sufficient to
allow the Air Traffic Organization to operate a 21st century air traffic
system. As the Administration said in 1995, the individual reforms of the
ATC system are interrelated, and "fundamental air traffic reform requires
that these changes be made together or the benefit of individual changes
will be greatly reduced." Thus, the President also will call on Congress
to reform the way air traffic services are financed, in keeping with
recommendations from both the Administration and the congressionally
created National Civil Aviation Review Commission:
? Congress should replace the excise tax on passengers with authorization
for the Air Traffic Organization to set cost-based charges on commercial
users of the air traffic control system. (General aviation should continue
to pay the fuel tax.). The Air Traffic Organization must be able to price
its services, in order to balance supply and demand in the short run and
meet customer demand in the long run.
? As soon as the Air Traffic Organization is fully financed by cost-based
fees, Congress should allow it to borrow funds from Treasury or on private
markets to finance long-term capital investments. Fees would replace
direct appropriations for capital, and would enable debt financing of
needed capital investment.
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AIR TRAFFIC SERVICES SUBCOMMITTEE DESIGNEES
Nancy Kassebaum Baker
Former U.S. Senator Nancy Kassebaum Baker will be designated for
appointment to the Air Traffic Services Subcommittee for a three-year term.
She currently serves on the Board of Trustees for the Robert Wood Johnson
Foundation and the Kaiser Family Foundation. She also chairs the national
advisory committee on rural health to the Secretary of Health and Human
Services and is on the Board of Directors of the National Committee on
U.S.-China Relations, the African Law Institute Council-ABA, the
International Medical Corps and Handgun Control. During her three terms
(1979-97) as a U.S. Senator from Kansas, Senator Kassebaum served as
chairperson of the Subcommittee on Aviation, the Labor and Human Resources
Committee and the Subcommittee on African Affairs. Senator Kassebaum
received a bachelor?s degree from the University of Kansas and a master?s
degree from the University of Michigan.
John J. Cullinane
John J. Cullinane will be designated for appointment to the Air Traffic
Services Subcommittee for a four-year term. Mr. Cullinane is president of
The Cullinane Group, Inc., and was the founder, president, CEO and chairman
of the board of Cullinet Software, Inc., a pioneer in the computer software
industry. He was a Fellow in the Center for Business and Government at the
John F. Kennedy School of Government at Harvard University and also
organized and chaired a series of seminars sponsored by Harvard University
for CEOs. An investor and board member in a number of emerging software
companies, he has worked extensively with the Irish software industry, and
has promoted economic development in Northern Ireland. Mr. Cullinane
graduated from Northwestern University.
Leon Lynch
Leon Lynch will be designated for appointment to the Air Traffic Services
Subcommittee for a five-year term. Mr. Lynch is currently serving his sixth
term as international vice president for human affairs for the United
Steelworkers of America (USWA). In this position, he oversees the union?s
civil rights and human rights efforts. Mr. Lynch was elected in 1995 to the
AFL-CIO Executive Council. He frequently represents the USWA and the
AFL-CIO at conferences of the International Labor Organization and in
international labor matters. President Clinton appointed Mr. Lynch to the
Advisory Council on Unemployment Compensation, and he is a member of the
executive committee of the Democratic National Committee, chair of the A.
Philip Randolph Institute, president of the Workers Defense League, a board
member of the National Endowment for Democracy and a member of the Labor
Roundtable of the National Black Caucus of the State Legislators.
Sharon Patrick
Sharon Patrick will be designated for appointment to the Air Traffic
Services Subcommittee for a four-year term. Ms. Patrick is a co-founder and
the president and COO of Martha Stewart Living Omnimedia, Inc., as well as
a member of the corporation?s executive office and board of directors.
Prior to her current venture, Ms. Patrick served as president and CEO of
Rainbow Programming Holdings, Inc. Previously, she was a partner of
McKinsey and Company, an international consulting firm, where she led a
team that conducted a comprehensive management review of the U.S. air
traffic control system. This team investigated problems underlying the
Professional Air Traffic Controllers Organization (PATCO) strike and
recommended actions for improvement that were subsequently adopted. Ms.
Patrick received a bachelor's degree from Stanford University and a
master?s degree from Harvard Business School.
John W. Snow
John W. Snow will be designated for appointment to the Air Traffic Services
Subcommittee for a three-year term. He is currently chairman, president and
CEO of CSX Corporation, a transportation company that provides rail,
container-shipping, intermodal and logistics services. He has served in
senior executive positions with the company since 1977. Mr. Snow previously
served in the U.S. Department of Transportation as Administrator of the
National Highway Traffic Safety Administration (1976-77), Deputy
Undersecretary (1975-76), Assistant Secretary for Governmental Affairs
(1974-75), Deputy Assistant Secretary for Policy, Plans and International
Affairs (1973-74), and Assistant General Counsel (1972-73). Mr. Snow
received a bachelor?s degree from Kenyon College, University of Toledo, a
doctorate in economics from the University of Virginia and a law degree
from George Washington University Law School.
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