ATC Privatization Off the Radar, For Now

Supporters and opponents of efforts to sever the nation’s air traffic control system from the FAA were surprised Tuesday night when Rep. Bill Shuster (R-PA) announced he was dropping his controversial ATC privatization plan and removing it from any further House consideration, at least for now.

Shuster’s proposal to create a not-for-profit corporation to operate the ATC system emerged last year when the House Transportation and Infrastructure Committee approved the design with a 32-25 vote. Shuster’s legislation is not, however, the first attempt to split ATC away from the agency over the last 20 years and probably won’t be the last.

Shuster said in a statement, “Despite an unprecedented level of support for the legislation – from bipartisan lawmakers, industry and conservative groups and labor groups alike – some of my own colleagues refused to support shrinking the federal government by 35,000 employees, cutting taxes and stopping wasteful spending.” Members of the Senate had earlier decided not to support privatization legislation while working out a plan to reauthorize FAA funding that runs out March 31.

Despite Shuster’s announced plans to retire from the House at the end of his current term, analysts on both sides of the privatization debate were confident the Pennsylvania representative would give the effort another try. As early as this week, proponents of ATC reform told Flying they too believed Shuster would again raise the privatization issue as part of the reauthorization effort. Just a few weeks ago, Shuster’s plan seemed to take on a fresh head of steam when President Trump’s proposed budget addressed support to separate ATC from the FAA.

President Trump last summer declared the nation’s ATC “broken,” and a “total waste of money,” although he didn’t offer specifics to support these claims. Some reports said the president’s perspective on ATC was colored by comments from his personal pilot, John Dunkin, whose name recently began circulating in Washington as a nominee for the role of FAA Administrator.

Major airlines supported efforts to privatize the ATC system, claiming it was the only way to guarantee the solid funding streams needed to finally bring NextGen to fruition. Even the air traffic controllers bargaining agent, the National Air Traffic Controllers Association, that would have seen its members terminated as federal employees, stood behind the idea to reform the funding process. If the switch had occurred, controllers would have become some of the first employees of the new ATC corporation. It is not clear how large a percentage of rank and file NATCA members actually supported the privatization effort, however. The board member selection process also called for selecting an airport representative that seemed likely to come from a location with mostly airline service.

Opposition Turned Up the Heat

Organizations like the National Business Aviation Association, the Aircraft Owners and Pilots Association, the Experimental Aircraft Association and hundreds of other general aviation groups were openly hostile to the privatization idea. Opponents took to Twitter and Facebook, as well as issuing news releases and white papers reminding members of the A4A’s “Aunt Edna” campaign a decade ago. In the Aunt Edna campaign, the airline-supported A4A portrayed business aviation as the major reason for ATC system delays, also highlighting how little this segment of aviation contributed to the cost of running the air traffic control system when compared to the airlines. The difference between the Aunt Edna campaign and the recent opposition to Shuster’s plan however was simple; the recent GA and Biz Av efforts proved successful in putting the “ATC Not for Sale” message in front of people who mattered while also convincing them that splitting ATC from the FAA was too radical an idea to solve any NextGen problems.

A few recurring questions that went unanswered were exactly what problem the new corporatized ATC organization was being created to solves, as well as was how spinning off the system would spur modernization. While Shuster claimed termination of his corporatization efforts were based on a lack of support, even from other Republicans to both shrink the federal workforce and reduce taxes, opponents countered that effort’s logic seemed to make sense only to the plan’s supporters. Supporters also claimed there was nothing political about the privatization move, only economics.

For example, despite the wording in H.R. 2997 that detailed how the ATC corporation's board members would be chosen, opponents did not believe promises that GA and Biz Av would hold as much influence over operations as the airlines.

How disputes within the new ATC system would be handled became another front-burner issue, but never evolved into anything in writing that opponents thought made realistic sense. In a June Politico article, DOT Secretary Elaine Chao said the administration was concerned that so many users, especially those in the GA world, seem so "misinformed" about the Shuster ATC proposal. She said that if members of the general aviation industry thought any new entity running the system was limiting their access to U.S. airspace, they could always appeal to their lawmakers. "Being in the private sector, being in the nonprofit sector, does not mean that it's exempt from congressional oversight," Chao said. The Secretary did not offer any details of how that appeal system might actually work, however.

The plan also called for the FAA to transfer billions in assets purchased with Trust Fund dollars to the new corporation, a giveaway that angered opponents. Supporters called the fuss much ado about nothing, claiming those assets – control towers, enroute center buildings and radar systems - were old and in need of replacement anyway, making their value only slightly greater than worthless.

In a statement released yesterday, NBAA said, “The general aviation community came together like never before and clearly told Congress that handing over our nation’s ATC system to an airline-dominated board is a risk we simply could not take …” AOPA’s Mark Baker added, “This is what advocacy is all about” as “AOPA and other groups identified the threat this bill posed for GA.” EAA highlighted another element of the Shuster plan that wasn’t much discussed. “The government’s own nonpartisan review agencies panned the ATC privatization concept, noting it would add nearly $100 billion to the federal deficit, slow modernization of the air traffic system, and threaten national security.”

Shuster said Tuesday he’s committed to working closely with South Dakota Sen. John Thune to finalize an FAA reauthorization bill before the agency’s funding authority expires. The question on many minds, though, is who might again pick up the privatization torch once Shuster is gone.