Up in the Air

When pilots get lost in the fog of Virginia's Shenandoah Valley, or try to navigate the Blue Ridge Mountains for the first time, they rely on Federal Aviation Administration specialists like Curt Lasley to help them get their bearings. On a cloudy night three years ago, Lasley helped a pilot who had lost the electronics on his plane-he was essentially flying blind-rise above the cloud line and find an airport where he could land. But after 18 years of being a lifeline for pilots in a jam, Lasley now faces his own quandary. He is one of 2,711 FAA flight service specialists whose jobs could be contracted out as a result of the largest, most complex public-private competition ever held in government. § On a rainy April morning, Lasley walked into a group interview with a reporter at an automated station in Leesburg, Va. When a manager extolled the possible benefits of the competition, including a separate budget for flight service, Lasley, a regional vice president with the National Association of Air Traffic Specialists, was quick to disagree. "You give one side, I'm going to give the other," he told his manager. "We look at it as nothing more than a check mark by the box for the President's Management Initiative."

Strong feelings and political agendas are the hallmarks of FAA's attempt to use the public-private competition process to solve a long-standing management problem: how to upgrade its flight service operation. For decades, the customers of flight service, the 550,000 noncommercial pilots who make up the general aviation community in the United States, have called specialists on the phone to file flight plans, receive preflight weather briefings, and hear the latest airport conditions and flying restrictions. But pilots now can get many of these services online, particularly weather forecasts, without talking to a specialist. Since the early 1990s, the demand for flight services has dropped, but FAA has not closed any of its 58 stations in the continental United States, Hawaii and Puerto Rico. Some stations, like the one in rural DeRidder, La., struggle to attract staff. But they stay open.

FAA officials say the flight service system begs for reform. "The buildings are old, the equipment is falling apart, the people are disgruntled," says Joann Kansier, FAA's director of competitive sourcing. Kansier has spent 19 years at FAA in various acquisition jobs, and for as long as she can remember, the agency has been studying different ways of providing flight services. But political pushback from Congress and NAATS has kept reforms from getting off the ground. "We've wanted to do something in this area for a long time, but because we're in 58 congressional delegations, the question is how," she says.

Enter competitive sourcing. For Kansier and other FAA officials, including Marion Blakey, FAA administrator, the Bush administration's management agenda offered a way to modernize the outdated system. It gave them a highly structured process, outlined in Office of Management and Budget Circular A-76, and a political ally in the White House. "You need the strong support and backing of OMB, and we have that," says Blakey.

So in 2002, when some agencies were staging A-76 competitions over a single job, FAA set out to hold a nationwide contest involving thousands of specialists and the entire infrastructure at its 58 stations (three in Alaska are not part of the competition). The agency gave bidders free rein to propose where its stations should be, how many specialists should staff them, and what technology to use. Chasing a potential $2 billion payday, blue-chip firms flocked to the contest, and innovative partnerships sprouted up. Northrop Grumman is competing alongside NAV CANADA, the private air traffic corporation in Canada. FAA's own employees have teamed with Harris Corp., an experienced FAA contractor. After nearly two years of work, FAA will start evaluating proposals in August, and could pick a winner this winter.

That is, if political considerations don't stop the competition first. Many legislators, including Republicans such as Oklahoma Sen. James Inhofe, remain opposed to the competition. Massachusetts Sen. John Kerry, the Democratic presidential standard-bearer, will halt the competition if he is elected president, according to Andy Davis, his Senate spokesman. "Why would we federalize passenger and baggage screening functions only to privatize control over the nation's air traffic safety system, including flight service?" asks Davis. "It doesn't make any sense, and in Sen. Kerry's view, it would be detrimental to our aviation security efforts."

The politics of flight service led FAA to try competitive sourcing on a grand scale. And politics may be the undoing of its effort.

Hearing Voices

For some specialists, the competition has compounded the feeling that they are second-class citizens inside FAA. Technically, specialists are a type of air traffic controller. But over the years, they have received far less attention and funding than controllers who work in air traffic control towers and centers. The core flight service technology, still in use at more than 40 stations, is something called Model 1 Full Capacity, a 1970s-era system that long ago was declared obsolete. FAA technicians scour hospitals and schools to find replacement parts. "We are still stuck in the 1970s," says Lasley.

Despite their museum-worthy systems, specialists are good at what they do. They distill weather data and flight restrictions into three- to five-minute briefings, tailored to pilots' experience level. Like a crisis counselor, a specialist learns to listen for voice inflections that reveal a pilot's background and frame of mind. "Their first words betray them," wrote Jay Wade, a specialist in Nashville, Tenn., in "I Hear Voices," a tribute to specialists published in Flying magazine in May 2001. "It is not age, sex or pitch, but their pace and tone."

Pilots value this expertise. In a survey of fliers conducted for Kansier's office, the Mitre Corp. found pilots wanted more back-and-forth with specialists. "We can have all the automation in the world, but the human expert and the ability to interpret is considered to be a large quality factor by people who use that service," says James Washington, FAA's vice president for flight services.

But specialists may take customer service too far. "We found cases where flight service specialists were turning on airport lights," says Kansier. Mission creep contributes to flight service's steep price tag: It cost $564 million to operate the system in fiscal 2002. FAA estimates that each pilot call to a specialist costs between $20 and $36. "I frankly have not had anyone debate me that the cost-benefit [ratio] on this makes sense," says Blakey.

Blakey adds that current specialists will continue to be part of the flight service system, even if a contractor wins the competition. Forty percent of the specialists are retirement-eligible, meaning they could go work for a contractor and still collect a retirement check from Uncle Sam. "They could earn two salaries to do what they're getting paid one salary for now," says Kansier.

But many specialists don't see this silver lining. They note that the competition almost certainly will result in fewer specialists at fewer stations, and those who remain may have to uproot their families and move to new cities. Across the country, National Association of Air Traffic Specialists members are contacting lawmakers to rally opposition to the competition. In Washington, NAATS has hired lobbyist Chet Lott, son of Sen. Trent Lott, R-Miss., to press its case with Congress.

Other specialists are trying to influence the competition itself. Wade, the specialist laureate, has launched a quixotic attempt to bid in the competition himself, through a company he formed called Wade & Associates. While other bidders regard Wade as a curiosity, his steady stream of technical comments has made an impression at FAA headquarters. "He keeps us on our toes," says Kansier. "Jay cares about flight service, and I think he just wanted to have a voice in the process," says Derek Buchanan, a fellow specialist in Nashville.

Advocates for the specialists, including FAA's Washington, worry the competition could erode the local weather knowledge that pilots depend on. If a contractor consolidates the system into 10 stations in large cities, will future specialists understand the fog off Machias, Maine, or the distinctive wind patterns along the Blue Ridge Mountains? There are risks in putting an entire branch of your agency on the auction block. "This has never been done before," says Washington. "There have been other A-76 studies, but none this large, and none in a truly operational context."

Cutting-Edge Competition?

By tweaking A-76 rules and asking for technology-heavy solutions, FAA attracted top-tier systems integrators that usually ignore A-76 competitions. "This is not a typical A-76 where you just re-badge government employees as contractors," says Michael Freeman, a senior director at Northrop Grumman IT. "You have to provide a huge technical infusion."

Freeman is full of compliments for Kansier's office, which has used FAA's custom acquisition rules-the agency is not covered by the standard Federal Acquisition Regulation-to be more responsive to bidders. As part of FAA's performance-based approach, bidders can propose to use or scrap any of the 58 facilities where specialists now work, as long as they meet performance targets.

FAA is holding bidders to tight spending limits. Bidders will receive no more than $435 million a year, and FAA expects them to slash costs by an additional 22 percent over five years, yielding at least $478 million in savings. Despite these caps, contractors believe they can still turn a profit. "We think there is a sound business case here," says Richard Kramer, director of business development with Computer Sciences Corp.

Still, bidders say FAA could do more to encourage creative proposals. Freeman would like the agency to indemnify contractors from potential lawsuits over the flight services they would provide, a move FAA so far has resisted. Robert McMullen, FAA program manager for the in-house team, says a requirement that bidders use an existing FAA communications network could "blunt" technological innovation.

Some observers worry FAA is rigging the competition to favor contractors-a claim repeated not only by NAATS members, but also by OMB's former top competitive sourcing official, Angela Styles. In September 2003, shortly before she left OMB, Styles called Kansier and other agency officials into her office to voice her concern that the competition's tight deadlines would prevent the in-house team from crafting a competitive bid. At the time, FAA had allotted just two months for teams to craft proposals after the final solicitation was released, a startlingly short amount of time to write a bid, particularly for the in-house team, which had never submitted a proposal before.

"I remain concerned in light of recent events that the FAA has no intention of giving the in-house workforce a fair shot at competing," says Styles, now a partner at Miller & Chevalier law firm. In December, after an appeal from NAATS president Wally Pike, Blakey agreed to extend the deadline. Proposals are now due in August, and FAA will make an award sometime between Oct. 1, 2004, and March 17, 2005. "We are trying our best to be very fair to our own employees," says Blakey.

While Kansier says a contract award is "unlikely" before December, FAA technically could make an award as soon as Oct. 1, the start of fiscal 2005, when a Blakey pledge that FAA would not outsource any workers in fiscal 2004 expires.

An earlier award date would please contractors, who fear a potential Kerry administration would halt the competition. "We would love it," says Freeman. "We actually advocated that it be awarded before November of this year, because of the potential change in administration."

Playing Politics

But when FAA tries to close stations, politics can be hard to avoid. It spent much of the 1980s trying to consolidate 316 stations into the present configuration of 61. NAATS supported the move. But because legislators sought to protect stations in their districts, the move took 15 years.

Already, legislators are mobilizing to resist FAA competition, which undoubtedly will result in some closures. In the Senate, Democratic appropriators may press Blakey for a written pledge against outsourcing any jobs in fiscal 2005, according to a Democratic staffer. "At this point, I don't currently see a need for further letters," responds Blakey. "We've been pretty clear about what we are doing."

There is something ironic in how FAA has tried to use competitive sourcing, which has been a magnet for political controversy, to carry out sweeping changes to its flight service system outside the political process. Kansier is adamant that better management, not politics, is FAA's sole concern. "This is not about scoring points for Bush," she says.

But the controversy is unlikely to ebb. NAATS member Lasley says he is a "Republican-leaning independent" who plans to vote for Kerry. "I've talked to quite a few specialists about this, and they're all going to go for Kerry this year," he says. Once again, flight service's future may be settled by politics.