DOT IG: FAA bungled modernization projects

 - October 2, 2007, 9:39 AM

It is no secret that the FAA in the last several months has been forced to shelve a number of important ATC modernization projects. But now a blunt assessment by Department of Transportation inspector general Kenneth Mead accuses the agency of misjudging the technological maturity of the canceled programs and failing to gauge their true costs.

The projects include the FAA’s LAAS (local-area augmentation system), CPDLC (controller-pilot datalink communications) and Nexcom (next-generation communications) systems. Each could be described as a linchpin in the agency’s vision to overhaul ATC for the 21st century, and each faces serious doubts, according to Mead.

Mead delivered a negative assessment of the big-budget FAA programs in testimony before a transportation subcommittee hearing on ATC modernization after his office completed an independent review of these and other FAA programs.

He warned that the FAA should not be allowed to become entangled in costly and complicated technological undertakings without first having a clear understanding of the potential challenges and risks. Such an approach is especially important, he said, after the lessons of WAAS (wide-area augmentation system), the troubled navigation project that was significantly over budget and several years late, and Stars (standard terminal automation replacement system), a largely fruitless attempt to replace the nation’s ATC ground radars with new technology.

“FAA modernization projects have historically experienced considerable cost growth, schedule slips and shortfalls in performance,” Mead told subcommittee members at the hearing in late April. “In the current budget environment, cost growth and schedule slippages experienced in the past are no longer affordable or sustainable.”
Mead said the FAA needs to develop more realistic cost and schedule estimates for its modernization programs. This must begin with improved oversight of contracts with outside suppliers, he said, adding that rising costs, delays and performance shortcomings have serious consequences because they delay benefits to aircraft operators, crowd out other modernization projects and require costly Band-Aid fixes and interim systems.

LAAS: Lost Cause?

He noted that the FAA has made downward adjustments in its fiscal year 2005 request for LAAS, CPDLC and Nexcom funding, stating that while these projects have merit, “they face fundamental problems with respect to misjudging technological maturity, unexpected cost growth or concerns about how to move forward in a cost-effective way.”

LAAS is a precision approach and landing system that uses GPS and precisely surveyed ground stations to provide accurate vertical and lateral guidance to aircraft. In December 2002, the DOT reported that expectations for the cost, schedule and performance of LAAS needed to be “reset” because the new landing system concept was not as mature as the FAA thought. Then in January this year, the FAA canceled further expenditures on LAAS, leaving the program in limbo.

According to Mead, “Category I LAAS was planned for 2006, and more demanding Category II/III performance is now a research and development effort with uncertain completion dates. After assessing contractor progress, the FAA believes that it will take considerably longer, as much as 21 months, to complete just the first phase of LAAS,” meaning that it will likely be 2008 before Cat I capability is available–assuming no more delays.

The CPDLC concept, meanwhile, is a method for controllers and pilots to share information that is akin to wireless e-mail. Instead of talking on the radio, pilots would communicate with controllers using short text messages that would appear on a display in the cockpit. Mead said the FAA is “deferring plans” for CPDLC because of concerns about how quickly the airlines would equip with the necessary avionics and because “the approved program baseline of $167 million was materially understated and is no longer valid.” After 9/11 the airlines decided to focus more on survival by paring their flight schedules and operating costs than on spending money on initiatives such as CPDLC. Mead’s comments underscore the fact that the project was also over budget and about to require more money than stated in original projections.

The FAA last year deferred plans to deploy CPDLC beyond Miami Center because the agency doubted many users would equip with new avionics. As for its program cost miscalculation, the FAA estimated that it would take $69 million more than originally forecast to field fewer than half the CPDLC locations initially planned. The FAA now reports that CPDLC also would have added $63 million in operating costs for controller training and overtime and $20 million more annually for transmitting datalink messages, according to Mead’s report.

Nexcom Shelved

Somewhat unexpected was the news that the Nexcom project has also been shelved. An effort to replace aging analog radios with digital communication systems, Nexcom is involving R&D work and testing on the parts of Honeywell, Rockwell Collins and Avidyne. The first segment of Nexcom was to include new radios and ground infrastructure for digital communications and was expected to cost $986 million.

Yet Mead painted a troubling picture of Nexcom, saying that the full cost of implementing the concept throughout the National Airspace System simply is not known and adding that later segments were estimated to cost as much as $3.2 billion. In addition, he said Nexcom was controversial with airlines because the FAA preferred VDL Mode 3 technology over VDL Mode 2, which the airlines and others favored. While the FAA still has plans to move forward with replacement of older radios through contracts already awarded, the agency has postponed making decisions about Nexcom ground system development.

It is unclear at this point how the FAA will proceed with its ATC modernization initiatives, but even the DOT IG concedes that upgrades to ATC infrastructure are necessary and inevitable. For her part, FAA Administrator Marion Blakey said the FAA in the past 12 months has made progress to rein in costs and operate more like a business than a big government bureaucracy.

“We are doing better,” she told subcommittee members after Mead’s testimony. “In the past year, we have made changes that will fundamentally alter the way the agency operates. First, we began tracking goals, programs and spending through our Flight Plan–the agency’s new blueprint for action through 2008. For the first time in FAA history, our business plan is tied directly to our budget. The Flight Plan is making the FAA more business-like, more performance-driven, more customer-centered and more accountable.”