Introduction 

Welcome to Richard Anderson

Thank Dennis Roberts:

• It is my pleasure to announce Dennis Roberts as our new Southern Regional Administrator, based here in Atlanta.
  
• Many of you already know Dennis from his tremendous work in the Performance Based Navigation arena.
  
• Since December 2010, Dennis has been serving as Director, Airspace Services for ATO’s Mission Support.
  
• He worked closely with many of you as the key FAA representative on several PBN-related NAC taskings.
  
• He was also instrumental in developing the PBN blueprint for success and in helping industry identify both FAA and industry barriers – and possible solutions – to successful usage of PBN procedures. 
  
• Edie Parish will be Acting Director of Airspace Services.  But I want to thank and acknowledge Dennis for his very significant contributions to our NextGen efforts.  

NextGen Priorities 

• A lot has happened since our last NAC meeting on Oct. 8^th.
  
• We delivered the NextGen Priorities Joint Implementation Plan to Congress on October 17..
• The plan incorporated the NAC’s NextGen Integration Working Group Final Report as an appendix.
  
• We have participated in several Congressional briefings – with the NAC by our side.
  
• We have also developed and implemented an oversight process for monitoring these priorities.
  
• I am pleased to announce that the FAA delivered on 11 out of 11 commitments in calendar year 2014.  We completed wake recat in Atlanta, Cincinnati, and Houston, and completed feasibility assessments for PBN and surface initiatives. We also completed a final investment decision for initial en-route services for Data Comm.
  
• We are on target to deliver on three out of three commitments at the end of the first quarter of this calendar year, making us 14 for 14.
  
• Industry also met their commitment in calendar year 2014.
  - The Performance Based Operations Aviation Rulemaking Committee (PARC) completed their review of the data link recording rule and delivered recommendations in November of last year. 
  - I am very pleased to report that we completed our review of their recommendations, and on Wednesday, February 25, our new policy went on display in the Federal Register. The new policy applies the recorder rule only to new aircraft, manufactured after the effective date of the rule, and to those aircraft which did not have any data link solutions available before the effective date. 
  - This new policy will allow the rule to be applied in a consistent and predictable manner, and it enables thousands–of older aircraft to affordably access the safety and efficiency benefits of data communications.
  
• This work on NextGen Priorities has been very rewarding for the FAA and sets a new standard for how we are working together with the NAC to move NextGen forward.
  
• You will hear more details on all of these accomplishments this afternoon from the leads of the working groups and our FAA subject matter experts.
  
• I would also like to take this opportunity to thank Steve Dickson for his outstanding leadership of the NAC Subcommittee – Tim Campbell has a tough act to follow.

ADS-B Equip 2020 Mandate

• Eleven days after filing our report to Congress on the NextGen Priorities, FAA hosted an industry Call to Action.
  
• This was designed to bring all industry stakeholders together to assess how we’re doing toward being fully equipped with ADS-B Out by January 1, 2020.
  
• It was a very well attended event.
  - Identified a number of issues.
  - Created working groups to roll up our collective sleeves and problem solve.
  - This was led by General Hoot Gibson from the NextGen Institute, and the effort was called Equip 2020.
  
• I’m pleased to report that this initiative has resulted in quite a bit of progress.  I’ll mention just three areas where we’ve made significant progress.
  - In general aviation, we are seeing a marked uptick in equipage – 3,000 aircraft have equipped since October: A 50 percent spike.
  –More significantly, competition amongst avionics manufacturers has led to a dramatic cost reduction in equipage – over a 50 percent price drop since October.
  –Several sources now exist for units at prices lower than $2,000.
  
• In support of airline equipage, the Equip 2020 team reached an agreement that allows air carriers with first and second generation receivers (SA aware) to continue to use these until 2025. This recognizes their dedication in adopting early and it provides time to upgrade to the best available receiver technology. 
  
• It also recognizes that we want to reward – not punish – early adopters of technology.  We want to ensure earlier equippers have flexibility in compliance with final standards.
  
• This has been an unresolved issue for three years … but after the Call to Action, we got an agreement in about 60 days.  It’s a good example of what can be accomplished when experts work together as a team.
  
•  I also want to credit Equip 2020 for producing an equipage tracking database.
  
• With this effort, you’ll be able to capture data from suppliers (the solutions and products they’re offering) … and you’ll be able capture data from the air carriers (what are they buying, when are they buying it, etc.). 
  
• With this information, you’ll be able to track the equipage trends … specifically, by comparing supplier plans with air carrier plans and spot potential risks to achieving equipage compliance by the deadline.
  
• This way, we’ll know if we’re on track for 2020 … and if not, we can redouble our efforts accordingly.

McKinsey Benefits Study 

Like I said, it’s been a busy few months

• In addition to the Priorities and Equip 2020, FAA engaged the consulting firm McKinsey & Company to better understand the benefits NextGen is providing to the aviation industry.
  
• The FAA worked with McKinsey to conduct carrier-specific NextGen benefits evaluations, including the benefits of equipping with ADS-B Out. 
  - This McKinsey study covered major categories of carrier benefits, including:
  –Savings in direct operating expenses
  –Savings in crew time
  –Overhead savings
  –Benefits of added capacity
  –Benefits of increased predictability
  - The consultants used a replicable analysis based on the FAA’s system-wide model, with added elements that can be included in future modeling.
  
• We presented a business case to carriers in their language based on carrier-specific details, including:
  - Flight schedules and
  - Fleet projections and
  - The Net Present Value investment case for ADS-B Out and partial DataComm equipage by 2020, which in each case has a positive NPV.
  
• We held discussions with the six major passenger carriers:
  - Delta, Alaska, United, Southwest, American and jetBlue
  - We have also met with UPS and are scheduled to visit FedEx and Republic in the coming weeks.
  
• Key themes we heard from the airlines:
  - Appreciation of, and need for, an open, airline-specific dialogue with FAA on NextGen.
  - Perceived challenges with previous programs.
  - Commitment to equip for the ADS-B 2020 mandate.
  - Excitement over NextGen and the promise of future benefits.
  - Specific, near-term improvements each airline would like to see to maximize benefits.
  
• Next steps for the FAA’s work on NextGen benefits and carrier alignment:
  - Follow-up discussions with airlines.
  - Update to the FAA’s NextGen strategy.

 Houston, North Texas and DC Metroplex 

• Finally, just before the last NAC meeting, we implemented the latest Metroplex in North Texas, and subsequently we implemented new procedures in DC.
  
  - Lynn Ray is going to provide an overview of those projects.

Lynn:

• I would like to share a few highlights from our successful Metroplex initiatives in Houston, North Texas and Washington, D.C.
  
• In the spring of 2014, we launched 61 new routes for flights into and out of Houston area airports. At the same time, we also used a Time Based Flow Management capability along with the Houston Metroplex enhancements to help match capacity and demand, and increase throughput and capacity.  Post-implementation data analysis shows an annual savings of $6 million from reduced fuel consumption.
  
• Now in December, as part of NextGen priorities, we added the wake recat capability into Houston Intercontinental and Hobby airports, giving Houston a suite of fully integrated tools and capabilities.
  
• Last September in North Texas, we increased safety by procedurally separating departure and arrival flows to the two major airports serving Dallas with 80 new NextGen procedures. This was the North Texas Metroplex initiative. We continue linking North Texas to the rest of our nation’s airspace with the same repeatable and predictable methods of optimizing TBFM that were used in Houston. We are currently conducting post-implementation analysis of North Texas and will make sure the efficiency of the airspace compliments its increased safety.
  
• In Washington, D.C. our Metroplex initiative employs safer and more efficient procedures throughout the region. The D.C. Metroplex will implement 50 new procedures staged over eight publication cycles. These procedures will be completely implemented by June 25 and have projected savings of $6.8 million in fuel costs, 2.5 million gallons of fuel saved, and a reduction of 25,000 metric tons of carbon. The D.C. area will be more efficient and more green because of Metroplex.
  
• With various NextGen technologies, policies, and procedures coming to fruition and our ability to deliver on our promise to implement NextGen priorities, we are climbing that “mountain of challenges” Bill Ayer so often referred to. 

ERAM 

• Looking forward, I am very pleased to report that we are on the verge of finishing all ERAM sites.  Teri Bristol, ATO’s COO, will provide a few more details.

TERI:

• ERAM is considered the backbone of the nation’s airspace system.  Replacing the 40-year-old Host system, ERAM processes flight and radar data, provides communications, and generates data for controllers' screens—functions that enable air traffic control across the nation.
  
• The transition to ERAM represents one of the largest automation changeovers the FAA has ever undertaken.
  
• ERAM is a flexible and expandable system designed to accommodate the new technologies being implemented as part of the FAA’s NextGen initiative.
  
• To date all 20 En Route centers have reached Initial Operating Capability (IOC), a milestone met when the system is deemed acceptable to be introduced into the operational environment at an Air Route Traffic Control Center (ARTCC) and a local and national plan exists that can support the facility’s goal to move toward extended and continuous operations.
  
• 16 of the 20 centers have declared Operational Readiness Date (ORD) which is the commissioning of a new system into the National Airspace System (NAS).
  
• ORD is the culmination of a series of events and milestones that demonstrate confidence and operational suitability of a system.  ORD occurs prior to decommissioning of a legacy system, and is a separate activity from decommissioning.
  
• By the end of March we anticipate marking the completion of the ERAM deployment as the four remaining centers declare Operational Readiness (ORD).

FACT 3 Report

• Also since our last meeting, the FAA has issued its latest FACT report.  FACT stands for the Future Airport Capacity Task and details the long-term airport capacity needs of domestic airports.   Eddie Angeles, our Associate Administrator for Airports, will share the highlights of this important work

Eddie Angeles:

• As Mike stated, in late January, the FAA published the third edition of its report on long-term airport capacity needs. 
  
• The report identifies airports that are at risk for significant delays and congestion through 2020 and 2030.
  
• For the rest of this decade, much of the U.S. hub airport system has sufficient capacity – except for several high-demand airports that have consistent delays: NYC area airports, ATL, PHL, and SFO to a degree.
  
• New runways have helped to improve capacity at many formerly congested airports.  Going forward, both new runways and NextGen improvements are needed to improve efficiency at capacity-constrained airports.

Small UAS Proposed Rule

• Also, as I’m sure you are aware, earlier this month, we issued a UAS proposed rule as the next step in our continuing efforts to integrate unmanned aircraft systems into our nation’s airspace.
  
• We’ve made a lot of progress in our task to integrate UAS. Last year, we published a comprehensive plan and road map to safely integrate unmanned aircraft; we opened six test sites across the country for research on unmanned aircraft; we approved the first ever commercial operations in the Arctic; and we have granted more than two dozen exemptions for commercial use of unmanned aircraft in domestic airspace.
  
• The proposed rule is a big step forward in outlining the framework that will govern the use of small unmanned aircraft weighing less than 55 pounds. This proposed rule offers a very flexible framework that provides for the safe use of small unmanned aircraft, while also accommodating future innovation in the industry.
  
• Safety is always our number one priority. This proposed rule makes sure that we are protecting other aircraft, as well as people and property on the ground.
  
• The unmanned aircraft industry is expanding greatly and this technology has the capability to dramatically change the way we use our nation’s airspace. 
  
• We are doing everything that we can to safely integrate these aircraft while ensuring that America remains the leader in aviation safety and technology.

Catex 2 Decision

• Continuing on our theme of recent accomplishments, I am pleased to share our most recent decision on Categorical Exclusions.
  
• In the fall of 2012 we asked the NAC to provide technical suggestions for determining ways to measure reduction in noise on a per flight basis. 
  
• The NAC approved their Catex task group’s recommendation to implement a system for noise analysis in the summer of 2013.
  
• The FAA has decided that we will use the NAC’s recommended net noise reduction methodology to implement the Categorical Exclusion that is called for in the 2012 reauthorization, with a couple of technical modifications:
  1. We’ll evaluate net changes in noise, instead of net changes in the affected population.  This is more consistent with the statute, which requires a determination of measurable reductions in noise.  A net day-night average sound level reduction would support this determination.
  2. We’ll rule out using the categorical exclusion if noise increases are significant. Instead of the NAC’s add-on significant test, this will be embedded in FAA’s interpretation of what constitutes a measurable noise reduction.  We won’t make a reduction determination in situations where there are significant noise increases.
  
• Our noise staff tested these modifications using the same data at two airports that the NAC Task Group used to test the NAC’s recommendation, and we got the same results.
  
• The FAA will provide a detailed debrief at the March 11 subcommittee meeting for those who are interested.
  
• I do want to call to your attention that industry provided the only positive comments on this categorical exclusion and this net reduction methodology. 
  
• All other comments were negative, and highlight the problem we’re experiencing with opposition to PBN procedures that shift noise over communities.  One of the expressions of community concern is to demand more detailed and participatory environmental reviews than occur when we implement a procedure using a categorical exclusion. The opposition to using categorical exclusions to bypass environmental reviews is a symptom of the larger issue of noise.  We’ll be discussing this in more depth at the June NAC meeting when we review the Blue Print for Success to Implementing PBN.

SESAR

Moving to the international scene, Ed and I made a trip to Brussels two weeks ago to meet with SESAR, Eurocontrol, the Commission, and the new Deployment Manager.

Ed, you want to provide a brief update on that?

• Since the NAC last met, the FAA and European teams have continued their harmonization work on many fronts.
  
• We've also had constructive discussions on how we are working together, and how we will do so going forward, especially as the new SESAR Deployment Manager section takes shape. 
  
• This was included in our discussions during our recent visit to Brussels. 
  
• One major accomplishment in the trans-Atlantic partnership that I would like to highlight is the recent completion of the Joint Harmonization Report that we have noted at previous meetings.  This document was written by a team of representatives from SESAR, EuroControl, and the FAA's NextGen and Air Traffic Organizations. 
  
• The report provides details of major initiatives and accomplishments made via the FAA-Europe agreement on harmonization over the last few years.  The report was presented to the High-Level Committee that oversees the trans-Atlantic agreement, and this committee approved the document and its public release. 
  
• And, I'm happy to report that the document has been printed and we've got a few copies here today.  The report will also be posted on the FAA and SESAR websites, and we'll have many more copies available at World ATM Congress in a few weeks in Madrid. 
  
• I think you'll find it a useful document that showcases the important work being done in partnership across the Atlantic.

Reauthorization and Capital Investment Plan

• The work on reauthorization progresses, we have a hearing before Congress scheduled for March 3. This hearing will cover our progress in implementing NextGen and areas where Congress can help us to create a more efficient system. With the current FAA authorization set to expire at the end of September, passing a new bill that helps lay the groundwork for the future of U.S. aviation is a top priority. 
  
• And finally, I’ve asked Mark House, our Chief Financial Officer to be here today to provide some highlights on our current capital investment plan.  In the interest of transparency, Mark is here to share our capital investment process and challenges we have in funding NextGen multi-year programs without multi-year funding. 

Mark House:  Presented Brief from a Slide Deck

Thank you, and that concludes the FAA remarks.