Budget Cuts Spur Rethink Of U.S. NextGen

By Michael Bruno
Source: Aviation Week & Space Technology
July 29, 2013
Credit: Metropolitan Washington Airports Authority

For the U.S.'s Next Generation Air Transportation System (NextGen), this time the sky really might be falling. Just as the program was demonstrating early results and the FAA was solidifying its pro-NextGen leadership, including Administrator Michael Huerta and new Chief NextGen Officer Michael Whitaker, now comes a one-two budget punch that threatens to disrupt the fragile momentum the decade-old program had built up lately. And no matter how it plays out, the conclusion is likely to be a new, triaged version of NextGen that tries to move forward while fending off its doubters.

But first, there are automatic budget rescissions from March's sequestration cuts to absorb, as well as the increasing likelihood of another round of cuts when fiscal 2014 begins Oct. 1. Even though unwelcome, cuts are the preferred route as House Republicans in their 2014 appropriations bill are aiming instead to set the lowest level of capital funding for FAA since 2000. Last week they approved language that, if enacted, would provide $439 million below sequestered 2013 levels for FAA facilities and equipment (F&E), an account critical to NextGen investments, let alone $623 million below the Obama administration's roughly $1 billion request for 2014.

To independent observers, the impact would be clear. Capital Alpha Partners analyst Byron Callan sees the House language, or “mark,” as worse than sequestration. “That markup cut the fiscal 2014 FAA's facilities and equipment request by 22% and would 'devastate' FAA modernization.”

The FAA-parent Transportation Department's inspector general, Calvin Scovel, 3rd, says the House's mark would freeze air traffic improvements. “In fact, [FAA] would have to devote all of its attention and much of its funding permitted by Congress to simply sustaining the current system as it exists.”

Not surprisingly, congressional Democrats and the administration agree. “This reduction would significantly slow, if not terminate, several aspects of FAA's maintenance of current facilities, equipment and the modernization of the nation's air traffic control system through NextGen,” says the White House Office of Management and Budget (OMB). Because the F&E account covers more than just NextGen upgrades, the House mark is even more damaging as it would slash “critical” infrastructure such as back-up electrical power to keep air traffic facilities going during commercial power outages, OMB says.

House Republicans, who control the lower chamber, are passing appropriation bills this year that follow their overall tea-party-influenced budget framework. Among other elements, it entails unrequested, additional spending for national security but deeper cuts for civil agencies like FAA. The administration has threatened to veto any final bill that adheres to that framework. By comparison, the Democratic-run Senate Appropriations Committee's $962 million related mark for NextGen provides “robust” funding for NextGen, OMB argues.

Competing House and Senate appropriations notwithstanding, sequestration is likely later this year as hope fades in Washington for a “grand bargain” over the federal debt and budget, necessary to undo the 2011 Budget Control Act and its sequestration cuts. If so, FAA supporters should not expect the agency to emerge as relatively unscathed as it did under 2013 sequestration, one congressional aide warns, when Congress spared FAA from some of the worst effects by allowing the agency to use funds from the Airport Improvement Program.

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