Press Briefing by Senior Administration Officials on Aviation Congestion Announcement

Indian Treaty Room

Dwight D. Eisenhower Executive Office Building

PARTICIPANTS:

Mary Peters, Transportation Secretary

Bobby Sturgell, Acting FAA Administrator

and Jess Sharp, White House Domestic Policy Council Deputy Director

2:48 P.M. EDT

MR. SHARP: Welcome, everybody. I'm Jess Sharp, with the Domestic Policy Council. You've just heard from the President about the state of air travel delays in this country. He just received a briefing from Secretary Mary Peters and from Acting FAA Administrator Bobby Sturgell. Clearly, he understands there's a lot of frustration out there. Travelers are being stranded at the airport, stranded on the plane, stranded on the tarmac. And he expects us to -- as part of his administration, to solve this problem. He expects Congress to enact an FAA modernization bill. And he has asked very directly the Secretary and Bobby to go back and to work with the stakeholder community to try to make as big of a dent in this problem as we possibly can in the shortest amount of time we possibly can. And he's expecting a report back from them by the end of this year.

So with that, I'm going to turn it over here to the Secretary first, and then to Acting Administrator Sturgell for some opening remarks, and then we'll go to some questions, and eventually get to folks on the phone, as well, for some questions.

SECRETARY PETERS: Again, thank you all for being here. As Mr. Sharp said, I've just earlier today -- in fact, just a few minutes ago the President and Acting Administrator Sturgell and I met with the President about the need to fix the aviation gridlock that is making America's skies increasingly unfriendly for a number of travelers. And I said to the President that travelers today are plenty cranky, and they have a good reason to be. I told him that we need to confront this challenge on multiple fronts. We need to use innovative new approaches to provide targeted relief for the nation's most congested airspace. We need to modernize our air traffic control system, and we need to ensure better customer or consumer protection.

Immediate actions that we will be taking on behalf of consumers include advancing a rulemaking to increase the compensation for passengers who are involuntarily bumped from an oversold flight. Today that fee is about $200, the compensation that those travelers would get, and we have proposed moving that up to approximately $624.

We also want to provide better information for travelers, and stepped up oversight of chronically delayed flights. Further, we're updating our complaint system, and we'll be conducting reviews to determine carrier compliance with consumer protection requirements. In addition, we have a report that was released this week by the inspector general, upon my request. I have tasked the Department's consumer protection officials to address the recommendations in the report, the ones that we're not already covering. And we will be ready to act on these proposals and report back to the President by the end of the year.

But consumers need more than that. What they need, really, are solutions to congestion so that these delays aren't happening in the first place. We need to treat the symptom -- not just the symptoms, but the actual cause of the delay. They need real flight schedules, not a guestimate about when a flight may take off. They don't need to be sitting on runways for hours, sleeping at airports. None of that should be part of the adventure of travel.

So we also have just recently undertaken an airspace redesign in the New York City area that Acting Administrator Sturgell will speak to. But to help us get to the real causes of the delays, and to fix them, we're bringing together the top executives from the Port Authority of New York and New Jersey, the airlines that operate in New York's three airports, aviation groups representing pilots, commercial airlines and general aviation, and consumer groups.

They will all serve on what's known as an Aviation Rulemaking Committee, or ARC. At their opening meeting that occurred just earlier this afternoon, I challenged them to be bold, and to identify market-based mechanisms and other policies that can be used to reduce congestion and more efficiently allocate the airspace in the region. And I've asked them to finish their work by the end of the year. This time frame will hopefully allow us to provide relief before next summer's heavy travel season.

And we're focusing on New York-area airports specifically because delays there have a rippling effect throughout the entire system. If we can fix the delays in New York, we'll provide improved flying for a significant number of travelers. One-third of the nation's air traffic goes into, out of, or over the New York airspace, and it accounts for three-quarters of the chronic airline delays that we're experiencing today.

Demand for travel at New York's JFK airport guarantees delays during peak hours even in the absolute best of conditions. The airport has capacity for around 44 departures between 8 a.m. and 9 a.m., but on a typical Tuesday morning in August, airlines needed room for 57 scheduled departures. So we're going to watch the situation, we're going to continue to monitor what happens in New York with the ARC very closely, and if necessary we're prepared to take the next step and issue a scheduling reduction order to reduce the number of flights scheduled at JFK airport.

So today I'm also announcing that the Department is convening a scheduling committee made up of the airlines operating at JFK. The committee will develop recommendations for reducing the number of flights into and out of this overcrowded airport. Let me emphasize, though, our strong preference is to find a way to let the market incentives do the job and not to return to the days of government-regulated flights and limited competition.

It's very clear to all of us that without fundamental changes in the way that we manage air traffic in New York, congestion everywhere and all of our system will get worse and even more travelers will be inconvenienced. Directing New York will help, but the current air traffic control system is simply incapable of addressing the flood of travelers that will be taking to the skies; a number that will be more than a billion by 2015.

So to prepare for this growing demand, earlier this year the administration proposed a major reform bill to Congress. This is a bill that overhauls the nation's air traffic control system by changing the way we pay for it and by investing heavily in new technologies. The new satellite-based system that we're building will dramatically expand the airspace capacity over the next 20 years, and that, of course, is the long-term key to reducing congestion.

We've also asked Congress for greater freedom to allow the market to work, to reduce delays in the air and on the ground both now and in the future. And I'm calling on Congress today, as did the President, to put aside special interests and move quickly to pass a bill that includes the kind of reform that will make a true difference for travelers.

We're acting very aggressively to unclog our skies with the ARC, with the New York airspace redesign, and with new ways to manage our traffic. But ultimately the challenge calls for broader solutions; solutions that won't happen without the help of Congress, without the commitment of the airlines, and the understanding of travelers. But with the announcements that we're making today, we're confident that if we all pull together, passengers can look forward to a time when the skies are clear of congestion and air travel again is comfortable, reliable and enjoyable.

Thank you, and I'd like now to ask Bobby Sturgell, our Acting Administrator at FAA, to discuss the steps that FAA is already taking to address the congestion at JFK. And then we'll take your questions.

ADMINISTRATOR STURGELL: Thank you, Madam Secretary, and thank you all for coming. The President put this issue in terms that everybody can understand. The passenger has had enough and all of the parties involved need to step forward to avoid a repeat of this summer. It's not an easy fix or a quick fix. But when all is said and done, it's going to make a difference.

Focusing our efforts on the New York airspace will enable us to keep a spotlight on where the problem is at its worst. In just three years, delays there have doubled. That sends a bow wave through the system that affects airports all the way downstream, even if they're looking at blue skies and not a cloud in sight. The President and the Secretary are providing direction that's going to give a boost to several efforts that are already underway.

As many of you know, we've been working to redesign New York's airspace, a move that could cut delays by 20 percent. It also cuts emissions by 430,000 pounds a year of C02, and it's a net-noise reduction of nearly 600,000 people. We've accelerated the deployment of new technology called ASDE-X -- Airport Service Detection Model X -- that will make runways there safer and more efficient because part of that deployment includes a circuit traffic management system which we intend to make available to the carriers before the summer of next year. This is a full year ahead of the original schedule for deployment of ASDE-X at JFK. We're combining high and low altitude airspace to create more efficient arrivals and departures. Frankly, we're looking at every way we can to cut delays in that area, especially in the short-term.

We've been hard at it at other major airports, as well. Since 2000 we've built 13 new runways at big airports, adding 1.6 million operations per year to the system. We're working on a runway extension in Philadelphia that will hopefully be complete in '09 and will cut delays by another 3 million minutes a year. In Atlanta, we commissioned a runway that enables 100,000 more takeoffs and landings a year -- a 30 percent increase in capacity at that airport. And we redesigned Atlanta's airspace and those new routes are saving $34 million a year in fuel. We have another airspace redesign effort underway in Houston, and in Chicago we've been using temporary, short-term caps that will be lifted as soon as that airport brings on additional capacity.

Next year we'll be commissioning four new runways at major airports across the country -- two in Chicago, Seattle, and Washington Dulles. In addition to these steps, bringing together the stakeholders to make decisive recommendations about fixing what's going on in New York will go a long way. The President made it clear that we've got to get it done, and the Secretary has set a December deadline for the recommendations. We've used this approach bringing stakeholders together with other tough issues like fractional ownership, performance-based navigation, aging aircraft, and most recently with ADSB and satellite navigation. I'm confident that working together we can get this done.

And adding onto the Secretary's comments about what the Department has proposed in terms of compensation for bumped passengers, I would refer you to the DOT website that contains comprehensive information on the new amounts that are being proposed for the various situations. Thank you.

MR. SHARP: Okay, we'll go to questions I guess. I think it's the easiest just to work around the room here. You, you first.

Q: Secretary Peters, the airlines look at the O'Hare experience as not a good model for the future because the airlines that agreed to cut back their schedule complained that others came in and re-crowded it. You had some mention here of market mechanisms. Does this mean negotiated reductions or does this mean congestion pricing? What does this mean? How does this differ from O'Hare?

SECRETARY PETERS: Matt, it is going to be different for O'Hare. It's a different situation with O'Hare. What was implemented in O'Hare we felt was a temporary solution back in '04 pending the completion of the new runway there and a new airport in the area as well. But it's different in New York. As Administrator Sturgell said earlier, we can't fill in the bay and make a new runway there.

And that's why nothing is off the table. We want to provide relief to consumers, we want to better manage our nation's available airspace. So within the context of this ARC and the scheduling, nothing is off the table. We hope that we can bring some real market-based solutions that will continue to give consumers a lot of choices, keep prices down, and increase the options for American travelers.

Q: Market-based solution, meaning variable pricing by hour of the day?

SECRETARY PETERS: It could mean variable pricing, congestion pricing -- it could mean either of those.

Q: Variable by size of airplane? Or something else?

SECRETARY PETERS: More likely variable by time that they're using the airspace. I think that would be probably initially where we would go, but, again, nothing's off the table.

Q: Back in 2000, the Clinton administration had a similar briefing to this, back when the last time flight delays were this bad -- actually, not quite as bad as now, but had gotten their previous highs. And now the teams have come full circle and we're back to where we started. Why should travelers think that this time will be any different?

SECRETARY PETERS: Andy -- I'm sorry, is that the name?

Q: Yes.

SECRETARY PETERS: Andy, the difference -- and of course, we all were talking about these same issues, as you said -- in 2000, into the summer of 2001; Congress was holding hearings on these issues, and some steps had been talked about -- I would say not as extensively as we're talking about today. But then tragically came 9/11/01, and it wasn't the problem anymore.

But today we're seeing air travel back up, increasing to and exceeding the levels that we saw in '01. And that's why we're taking the substantive steps that we are today, and we will over the next few months, to really address this issue not only in a comprehensive manner, but in a sustainable manner, so that we're not dealing with this again next summer or the year after.

Q: You're going to come back -- with these groups, come back with recommendations to the President in December. Will the government, will the Department step in and mandate some of these things? If you feel that the airlines don't go far enough on their own, what is going to be the government's role in that regard?

SECRETARY PETERS: Lisa, we certainly hope that everyone will come together and come up with some substantive recommendations that can move us through this. But we are going to do, as the President asked us to do, we're going to address customer concerns and we're going to address congestion. And we -- our preference, of course, is to get a bill and to work cooperatively with the industry. But if we can't do that, we will take steps to meet the President's two mandates.

Q: Does the Department currently have the authority to impose congestion pricing, or some kind of scheme similar to that?

SECRETARY PETERS: We have limited authority and we do think that we have, with the cooperation of the airports, the ability to implement some of these tools in the near-term. Our strong preference is to get the bill authorized that we have proposed to Congress, which would give us an ability to do pilots not only at LaGuardia, but at 15 other airports. But we do believe we have the authority, working in cooperation with the airports, to move forward today.

Q: I don't think the Port Authority wants congestion pricing, though, right? I mean --

SECRETARY PETERS: They're at the table. They're at the table with everyone else. And I've asked them earlier today to be bold, to be innovative. And it is in the interest of the airports and the airlines to not cause consumers to have the type of problems that they've experienced over the last summer. So I think it's in all of our interests to do everything we can to address these appropriate consumer concerns, but to do so in a manner that doesn't take away alternatives for American business and personal travelers.

Q: Two related questions. When will the schedule reduction meeting be convened for JFK? And why not also for Newark? And when would the schedule reduction take place?

SECRETARY PETERS: The scheduling reduction should be -- both the rulemaking committee and the scheduling committee were convened earlier today -- in fact, at 1:00 p.m. today we kicked off that effort. Is that not accurate, Bobby?

ADMINISTRATOR STURGELL: We still need at this point to put out what we think is the right number of operating authorizations for the airports. So we plan to do that next week, and specifically have folks involved in the scheduling piece of this by the following week. We certainly did put everybody on notice today at the rulemaking committee that this would be one of the things, in addition to the other market-based and other measures that are on the table that we'll be moving forward with concurrently.

SECRETARY PETERS: And this is LaGuardia and JFK.

Q: Why not Newark?

SECRETARY PETERS: We believe that we can achieve the solutions with these two airports; if we can't, we will reach out to Newark, as well.

Q: And a quick follow-up question. You mentioned consumer protection. What is your plan with regard to your current Office of Consumer Protection? It's a very small department of 13 people. And the way it stands now, if airlines don't want to refund your money they simply don't, and there's no one who can force them to do it. Are you interested in increasing the personnel or the legal powers of your consumer protection office to give them more clout, to intervene in customers' problems?

SECRETARY PETERS: Well, what we're asking them to do and what the President had asked us to do is to make sure that they're more responsive to consumer complaints. And ma'am, I haven't yet discussed whether or not we do need to increase the staff, the authority, the funding, but we will address those issues in making sure that we are responsive to consumer complaints -- and timely responsive to the complaints.

Q: Do you have any intention of affecting the airlines' business models, specifically when it comes to regional jets at some of these airports that are congested?

SECRETARY PETERS: Well, as I said, everything is on the table right now. And you make a very good point. We expect to see -- we are seeing a lot more planes in the sky, and there are more regional jets today, perhaps, than there were even back in the pre-2000 era.

But the other side of that is that they're providing more flight options for consumers. So we don't necessarily want to say you can't do that, but we do want to say, at the end of the day, we have to reduce congestion and delay. And so, again, everything is on the table today.

Q: You mentioned reducing the number of flights as a way of curtailing delays, as well as the penalty fee for the airlines. What measures will be in place to make sure that some of the cost is not passed on to the consumer, because obviously, some of these measures may affect the bottom line of the airline. So what measures will be implemented to prevent that from happening?

SECRETARY PETERS: The ultimate goal is to make sure that we are reducing the congestion and delays. And so, by pricing, perhaps by using congestion pricing or variable pricing, if we can move some of those flights out of the peak, we're going to be better off.

But the truth is that consumers are paying today, but they're paying with their time in a very debilitating manner. And we've heard stories of people who missed weddings, funerals, important business trips, anniversaries, things like that. So people are paying today. And what we hope to be able to do is come up together with a solution that will alleviate that kind of unplanned expenditure, in terms of their time and convenience, that consumers are paying today.

Q: And there's no chance of the cost being passed back on to them from the airline?

ADMINISTRATOR STURGELL: I'd like to add, if you look at O'Hare as an example, I mean, I just think this is a very, very competitive industry. So we're not aware of any evidence that we've seen costs being passed on at O'Hare, even though we do have operating authorization limitations in place at that airport.

And when you look at JFK, I mean, it's largely split between three carriers: American, Delta and JetBlue. So again, you've got very competitive airlines with substantial route networks, and it's a very competitive industry.

Q: Democrats in the House Transportation Committee this morning criticized the administration for taking this long in order to announce anything, any kind of action at all to address delays. Can you comment on that, please?

SECRETARY PETERS: Well, what I will comment on are several things. Back in February, we submitted a very comprehensive bill to Congress that would have dealt with many of these issues.

In the spring of last year, I asked the Investigator General to do a comprehensive investigation about the issue of consumer delays and consumer concerns. In June, I established an internal working group that has reported back to me and has resulted in the recommendations that we're briefing on today. In early September we announced the airspace redesign for the New York area and again, today's announcement of the additional consumer protection, the Aviation Regulatory Committee, as well as the scheduling committee. So I think we have certainly taken decisive action.

ADMINISTRATOR STURGELL: I would also add, since February of this year, I've been meeting with the stakeholders at the New York area, where we've been working through about a dozen operational improvements, on a very technical level, of things we can do to add capacity and efficiency to the New York major airports.

So this has been an ongoing issue. Many of you that follow the industry and the whole history of caps and high density rules know that the caps came off, the HDR was lifted in JFK in January of this year. Very competitive market, very competitive growth, and on top of that, I think some of the extreme weather we saw this year was really focused in the New York area, which added to the problems there.

Q: I think it was Mr. Sturgell who mentioned that the airspace redesign plan is going to have a net noise reduction for nearly 600,000 people. I was wondering if he also knows whether there will be any net noise increase for any people, and if he knows how many?

ADMINISTRATOR STURGELL: Obviously, the airspace redesign is a redesign of routes into and out of the New York metropolitan area. I cannot emphasize enough how much the airspace affects the capacity and efficiency of the system. And as we transform this system to a satellite-based system, we need to incorporate those kinds of routing -- area navigation, RNAV and RNP procedures -- like we've been able to do in places like Dallas and Atlanta, where we've added anywhere between 11 and 20 operations per hour at those airport. These are huge efficiency gains.

So to some extent, yes, flights will be redistributed differently. Folks will hear airplanes. I think to a large degree it is perception, because under the NEPA guidelines, we found a de minimis increase in noise as part of that air design. And again, it is a net reduction of nearly 600,000 people in noise, with 20 percent cut in delays. It's extremely important. We cannot solve the capacity on the ground without also solving the capacity in the air.

Q: But just as a quick follow-up, do you know how many people will see a net noise increase? Do you -- have you quantified that?

ADMINISTRATOR STURGELL: Well, in terms of net, it is a net noise decrease.

Q: Right. But planes are going to be moving from one area and they're going to be going over different areas. That means a lot of people will see noise decrease, but other people who never had noise before will see an increase. I guess I'm wondering, do you know how many people who will see a noise increase?

ADMINISTRATOR STURGELL: Any increases under the NEPA guidelines will be de minimis, according to our analysis.

Q: But you don't know how many people that will affect?

ADMINISTRATOR STURGELL: I don't off-hand, no.

Q: Okay, thank you.

Q: Secretary, you said that airlines don't need to be sitting -- or, passengers don't need to be sitting on runways for hours. Precisely how many hours are too many?

SECRETARY PETERS: Well, that's something that we're working with each of the airlines with right now. And I'll ask Acting Administrator Sturgell to tell you what some of the airlines have done already and -- in determining what is reasonable.

What we don't want to do though is put some arbitrary amount out there. Let's say I said it was three hours, and a plane is second in line for takeoff and they hit that three hours and they have to taxi back to the gate. So we want to have some flexibility so that we're able to use common sense.

But, Bobby, if you want to talk about what some of them have already defined?

ADMINISTRATOR STURGELL: Yes. Just, again, going back to what the Secretary was saying, I think the important thing is to have plans in place. So a couple of carriers have already voluntarily adopted plans, and I know specifically American has a four-hour plan, JetBlue has a five-hour plan. And then on the airport side, I do know that the New York Port Authority is look -- is developing a plan to address this issue, as well.

One of the things we are finding in these chronic delay situations is that surface management is extremely important, and that's one of the reasons why we're going to accelerate ASDE-X into JFK, and why we're going to add a surface traffic management capability to that system.

Q: Should there be some kind of civil penalty if they have passed plans -- have approved plans and don't use them?

ADMINISTRATOR STURGELL: The Department is looking at a whole range of options. The Secretary has had a senior working group working on consumer issues throughout the summer. She asked for the Inspector General's report, which the Department has just received this week. So there will be, again, a number of options that the Department is looking at, with respect to consumer issues.

Certainly they have already stepped-up enforcement oversight for chronically delayed flights, flights that are delayed more than 75 percent of the time, that also operate more than 45 flights per quarter.

Q: Just to clarify, is the schedule reduction meeting just for JFK, or is it JFK and Newark?

ADMINISTRATOR STURGELL: At this point, it is just for JFK. We're looking at -- this administration, this Secretary, this President's policies is always to grow capacity first. And that is what we've been focused on, and that's one reason why Chicago is a short-term cap right now, is because we expect runways to come online at that airport and we'll lift it. We want the market to operate as the market should. So our goal is to enhance capacity.

Q: And the market-based mechanisms, is that something you're looking at for all three New York airports, or just JFK, or just LaGuardia?

ADMINISTRATOR STURGELL: I think it will be discussed with respect to all three. Our real focus is JFK, because we do see, especially in the afternoon, a lot of overscheduling of what that airport can handle.

I go back to the redesign on the Newark issue. One of the short-term things we'll be able to do with airspace redesign is expand departures out of Newark, which we think is going to add probably one to two operations per hour. It doesn't sound like much, but that's a very significant increase at that particular airport. We're also talking with Continental about their plans, and I think everybody saw that Delta announced, with respect to JFK, they're going to move part of their afternoon bank into the evening hours. So they are voluntarily shifting into a less-used time of day at that airport, similar to what American did voluntarily at Dallas, and what Delta did voluntarily at Atlanta.

Q: I'm sorry, did you say that -- what will happen is the flights will move -- there will be less flights at JFK and more at Newark?

ADMINISTRATOR STURGELL: No, I did not say that.

Q: I'm sorry --

ADMINISTRATOR STURGELL: I would point out that the Port Authority is acquiring Stewart, and --

Q: You said expand the flights out of Newark? What does that mean?

ADMINISTRATOR STURGELL: Expand departures. Right now, airplanes have to take off on set headings out of Newark, and you have to leave so much time in between those airplanes as they depart. If planes are going off in different directions, you can move them off the runway quicker because you're not worried about the in-trail separation or the wake turbulence issues for the previous departure.

Q: I'm wondering, this morning at a Senate hearing, I talked with a passenger activist who said that all of this is interesting, but the only thing she really wants is the passenger bill of rights passed; if we don't have that, none of this will really protect passengers. What's the administration's position on that now? Would you accept some provisions of that being included in the FAA reauthorization, or is there no part of the passenger bill of rights that would be acceptable?

SECRETARY PETERS: No, we're not ruling that out at this point in time at all. And I know Congress has talked about that as well. What I want to do is take the Inspector General's report that we just received, look at that, and as we implement that over the next few months, make a decision about what best makes sense to deal with passengers' concerns.

Q: Can I just do a follow-up on something? We already have kind of a lottery restriction in place at LaGuardia, but you're still looking at some additional measures there, right? Just to be clear.

ADMINISTRATOR STURGELL: Yes, there is a notice of proposed rulemaking for LaGuardia. We have comments on it. We'll certainly be considering the results of the ARC as to what the next steps will be for LaGuardia, as well.

Q: What's your goal -- this may sound like a stupid question, but what's your goal of the schedule reduction committee? Is it to actually reduce the number of operations at JFK, or simply reduce the number per hour during peak times? What's the goal of that group?

ADMINISTRATOR STURGELL: Well, it's a combined effort, it's concurrent with the ARC recommendations and the scheduling. The whole goal of this effort? We want to reduce congestion, cut delays for the flying public. That's what this is all about.

SECRETARY PETERS: And let me say this, too. What we don't want to do is for the government to arbitrarily decide how we do that and impose some sort of restrictions that might not be good for the market; it might not, at the end of the day, be good for consumers. So we want to give this group, the ARC, an opportunity to put everything on the table and work together with us to decide how best we can address this issue and how best we can respond to consumers' concerns.

ADMINISTRATOR STURGELL: And I'll go back to -- our position is to grow capacity first. And that is certainly the reforms we proposed in our reauthorization and financing bill for the FAA. And we are hopeful that the Congress will act and act quickly and act with us to make these kinds of needed reforms.

MR. SHARP: We'll make that the last one. We've got to get the Secretary to her next appointment.

Thanks, everybody.

END 3:20 P.M. EDT