At eight big airports, mostly hubs, the FAA expects the controller cut to create average delays of 10-50 min. and maximum delays of 50-210 min.; it also expects significant increases in delays at a half dozen more big airports, and ripple effects throughout the system.
It is too soon to say how accurate the predictions will be. Initial results were not as bad as feared, although on-time departure performance did drop below 70% and even 60% at some major airports in the early days. Delta Air Lines and US Airways described those days as “manageable” with proactive flight cancellations or other mitigating measures. But big storms will really put the system to the test, as will the start of the post-school-year vacation travel season in June.
Major airlines fear they could lose tens of millions of dollars in revenue. American Airlines, for example, says it stands to lose $1 million in revenue per day; United Airlines says it could lose $2 million. Delta projects a more modest direct daily loss of $575,000 but adds that potential revenue damage is greater since, over the longer term, some customers will choose not to fly.
The FAA says it had no choice, and the Budget Control Act does not appear to give agencies much discretion: They must use the final seven months of the fiscal year to cut about 5% from their annual budgets, taking equally from all of their accounts. That amounts to $637 million at the FAA, which has four accounts: operations, facilities and equipment, research and development, and airports grants. But the FAA's difficulty is compounded because the law forbids sequester-driven cuts from airports grants, which amount to more than $3 billion of the agency's $16 billion budget. That means about $490 million must be taken out of operations.
Although the ops budget is $9.7 billion, the FAA's dilemma is that approximately 70% of that account is spent on personnel. FAA Administrator Michael Huerta insists that the agency cut as much as possible from travel, training and information technology, as well as with a hiring freeze, temporary employee layoffs and contract employee terminations.
Many Republicans do not believe him. Other than travel expenses, their biggest target is the $500 million in the ops budget for “advisory and assistance services.” Many Republicans deride that as “consultant” spending, but Huerta contends only $21 million of that amount is for consulting. More than $200 million is for a contract providing telecommunications, he says, and the second and third biggest contracts in that budget line are for flight service stations and the contract tower program—and cuts in the latter are being fought by many in Congress.
None of this seems to leave room for an easy fix. Huerta is being pressed to adjust the furloughs to boost controller presence at bigger airports, but he rejects that approach as inequitable and unlikely to make much difference because of the aviation system's interconnectedness. The procedural schedule for the airlines' lawsuit already is pushing into June. An FAA-brokered agreement for airline capacity cuts would be a less-than-ideal stopgap.
Beyond the political blame game on Capitol Hill, there is increasing talk of quick solutions—mostly involving explicit authority for the FAA to transfer money within accounts or for the Transportation Department to send some of its non-FAA money the agency's way. But there is only nascent legislative work to show for it (see page 23).
Everyone, however, seems to think some kind of resolution is at hand, because the alternative is unthinkable. Avoiding the unthinkable, of course, was also the assumption everyone made about reaching a deal to prevent the sequester in the first place.