Transcripts For CSPAN2 Transportation Secretary Elaine Chao Testifies On FAA Reauthorization 20170609

Web actors, increasingly important, but we dont have strategies for how to bring them together. Watch after words, sunday at 9 00 p. M. Eastern on cspan to the tv. Transportation secretary elaine chao testified before the senate and Transportation Committee on the proposal to privatize the air Traffic Control system. [inaudible conversations] good morning. I want to welcome secretary child back today. This is her first time before the committee since being confirmed. Madam secretary, i want tong thank you for appearing to discuss reauthorization. R we are working hard on a bipartisan basis to produce a bill. Hopefully during this work. We appreciate the engagement. The committee has held hearings on a range of topics underpinning this effort including safety, drone policy, role issues, aircraft concerns and infrastructure financing. One of the key issues we have not yet focused on this year but that has been discussed atet pensively occurs in other parts of the world is whether the United States should separate the air Traffic Control provider system from the f aa incom create a Nonprofit Corporation to do the job. this week the president used to join the proponents of significant reform. The president has challenged congress. And it is hard to ignore the many independent studies and reviews that document the flaws with the current structure and look forward on the merits as well as ways the administration will seek to address concerns at Key Stakeholders with the rural perspective. While reform has garnered the attention this week, there are plenty of other important issues that require the situation of the d. O. T. And this committee. The department administers several key programs including essential air Service Program and is response for conle soar protection oversight for the aviation industry. Last month, aviation subcommittee chairman blunt held a hearing on consoom ser issues and i am interested on what step this is the department has taken to address the matter. We craft our bill. We will continue to focus on start ication reform and the integration of drones in the air spis and Airport Infrastructure development and aviation safety and rural air service. There is still a lot of work to be done. I look forward to working with the colleagues throughout the process. With that, i reate the thanks to secretary choo for being her and turn to Ranking Member nelson for the opening statement. For the opening statement. In the way that it is so interested in this subject and with which we dispatched the subject matter last year in an exceptionally bipartisan way and an almost unanimous way. Madam secretary, welcome. The current extension of the faa set to expire the end of september, im hopeful that we were going to have a bipartisan and a longterm reauthorizationn bill ready to go in the coming weeks. And what i had expressed my preference to you just a few minutes ago, a bill summer in the range of five years to give you certainty over time that you have the authorization with which you need to execute the executive branch of government. I remind our committee that we passed this one year extension with a lot of substantive stuff in it. 95 to three in the senate. And at the time the chairman and i focus on areas of agreement. This resulted in legislation that addressed the safe integration of drones in the National Airspace, significant reforms to the faa certification process, and broad ranging aviation consumer issues. This was a win for aviation stakeholders as well as the traveling public, which was reflected in that overwhelming vote. Now, any further progress on that bill was thwarted in the house by the proposal of hybridization of air Traffic Control. So we now operate just on aneyb oneyear bill with a new looming deadline. Madam secretary, i understand that you will present the administrations support for the shifting atc services from the faa to an independent entity. That will be governed in part by the airlines. My views on this matter i have already shared with you are the same as i expressed rather vigorously last year when this subject was up for debate. Why . Because we have the safest air Traffic Control system in the world. Why would we risk that by handling the whole thing over to an untested, unproven entity . And why give away billions of dollars in government assets to an entity that will be governed in large part by the airlines . Even some of our colleagues on the other side of the aisle, is which really is not so much applicable to this committee as it is to the full senate, have not rallied nine this proposaln because they understand the potential harm to general aviation as well as too small and Rural Communities. And a fundamental breakup of the faa cannot advance when there is such Strong Division amonggress. Aviation stakeholders and in eni congress. So this entire discussion over atc privatization distracts from the legitimate matters that must be addressed by the congress on the part of faa reauthorization. Now, its no secret that the traveling public is frustrated, and i want to grant what the chairman has said about this cet matter. M there are certainly ways that we can be more efficient. We are right at the point of handing over a lot of the communication via radar to the gps satellite system. Ersta that is, as i understand it, is going to occur in about three years, whereas the remainingf implementation over, of the entire next generation is going to be over a dozen years. That can certainly be made more efficient and effective, and, indeed, it will save time and t fuel and money for the traveling public, as well as the airlines. If you can go from point a to see instead of having to go on route because of the radio beacon from a to b to c, and you can cut off that dog lag with a beeline straight to your destination, then it saves a lot of time, youll, and money. Fuel. Thats the point of nextgen, plus having Situational Awareness in the cockpit so that you know at all times because you have a much improved Communication System in the cockpit, that you know what of the traffic is around you. At the same time the traveling public is frustrated. Look what we are seeing everyday. They are frustrated they cant check their bags or board flights with increasingly shrinking sizes of, and or overbook seats without paying oe fees. So one of the airlines is ordering a whole new set of boeing 737s. And instead of 31 inches between the seats in tourist, in fact, theyre going to get it down to 29 inches because they are going to put in this new boeing 737 an additional 12 seats in the samea amount of having space. Passengers are expressing their frustration. They are frustrated that the airlines wont design their websites that clearly communicate their views and policies. F they are frustrated that failinn airline i. T. Systems result ints canceled and delayed flights foa days on end. And i see a lot of our members with very interested expressions on their faces because its happened to us as well. So this is why this years faa reauthorization legislation must once again include strong Consumer Protections to address these growing frustrations. Ven after all, if the airlines cant even manage their own i. T. If systems, you can imagine if you took and put all that over into air Traffic Control. That doesnt give us a very gooe result. So lets deal with the real problems like the way passengers are treated as valuable customers, which the airlines obviously want to do. Lets dont go around trying to find a solution in search of a problem thats not a problem. So lets keep the focus on a bipartisan longterm, and iy fie would say, fiveyear comprehensive faa reauthorization bill and lets try to do it and show actually w in this congress we can get something done and something passed and passed in a bipartisan way. L and so as usual, madam secretary, all of us look forward to working with you. You are an excellent public servant. N you have given yourself to Public Service over the years, and we appreciate that very much. Thank you. Thank you, senator nelson. Madam secretary, he gave you a lot to chew on there, so we will look forward to hearing from you. If you would proceed with the remarks and then well open it up to the panel for some questions. So thank you again for being here. Welcome. And he very much. Chairman thune, Ranking Member nelson, and members of the committee, thank you for inviting me to testify before the federal aviation administration, and the faa reauthorization legislation. Nearly a century has passed since the federal government began regulating the nations airspace. We have come a long way since the Transcontinental Airway system of the 1920s. Pilots flying at night withe light towers and huge concrete arrows painted yellow. In the decades since, a and progression of congressional and president ial initiatives has resulted in the air Transportation System we know today, and altered the Regulatory Framework along the way, sometimes quite dramatically. To keep up with the evolving technology, new regulatory entities were created, and old ones were restructured to make more efficient and effective use of our nations airspace and to improve aviation safety. We can all take pride in the t tremendous gains that have been achieved, but as you well know, the pace of technological changs has increased dramatically over the past several decades. Th at the same time, the traditional model of the Government Procurement and a budgeting is making it more and more difficult to keep up. Air Traffic Control is a perfect example. Despite billions of dollars of taxpayer investments over several decades, theofth implementation of stateoftheart air Traffic Control technology is not where it needs to be. So this administration has taken a bold step and enjoyed many of our counterparts worldwide by c separating air Traffic Control operations from the safetys oversight function of the faa. This administrations proposal will create a separatet nongovernmental, nonprofit cooperative to operate our countrys air Traffic Control system. The new entity would be a fully capitalized financially funded selfsustaining entity funded by users of its services. All surplus revenues would bek n reinvested back into the system. Because just because its not proper doesnt mean that it doesnt accumulate surplus. Cess mindful that the key to any organizations success is itsis employees, the administrations proposal poses that the new entity existing labor agreements and that employees transferred from the faa will be kept all in terms of pay and benefits. Although they will no longer be federal employees. These reforms will accelerate the deployment of new air Traffic Control technology that is so critical to managing the National Airspace with more precision, thereby enhancing safety. Passengers will benefit because of these reforms will speed up the delivery of new technology that will delay, that will reduce delays and congestion. Air Traffic Controllers will benefit because these reforms will ensure that they have the most uptodate tools and technology. And i want to single out and thanked these dedicatedt in professionals who are indeed the best in the world. They are true heroes keeping the flying public safe everyday. And taxpayers will benefit because the system will be fully financed with user fees. G and let me mention again that 100 of the surplus will be able to be reinvested back into the system. We also believe that the proposed new entity is necessary to accommodate the expected dramatic increase in passenger traffic over the next decade. And to integrate new entrance into our airspace, such as Unmanned Aircraft systems and commercial space operations. My written testimony contains more detailed information on the proposal and, of course, legislative language to be submitted will contain many more details. It is worth noting that over the past 20 years, more than 60 countries have successfully managed similar atc air Traffic Control reform efforts. Each country is different, we recognize that, and we also recognize that the u. S. National airspace is the biggest and most complex in the world. Be nevertheless, are lessons to be gleaned from the experience of other countries, and we need to embrace transformational reform. Innovation and the ability to change with changing times is one of the hallmarks of ourst country, and part of our aviation history. The proposed reform will ensure that the United States remains the world leader in aviation Going Forward into the future, and this is an industry that we pioneered. So thank you for the opportunity to appear before you today, and ill be happy to take any questions that you may have. Thank you, madam secretary. As i mentioned in my opening statement, there been many concerns raise regarding the recent proposals for atc reform, and the potential impact i i should send smoke unity air service. Pr i was glad to see that the principles announced by the president this week underscore the need to maintain access and services for Rural Communities. And my question is how does the administration invision this proposal for a new atc entity insuring that there are such safeguards in place for Rural America . The administrations proposal will enhance safety, improve access, and also increased efficiency. All of these features will help to make the system better. As weve already heard, the congestion and delays that we o are seeing in our airspace can be alleviated by a different governance structure. Tardiness with which are implementing technological advances can be addressed through taking this air Traffic Control entity out ofcratic g bureaucratic governmentafest procurement rules. We have the best and safestt system in the world. We want to maintain that. And to enable the system in the future to maintain its supremacy, we need to have the muchneeded technological advances. We need to have a different way for the air Traffic Control system to be able to space airplanes, for example. C and on the rural front im very concerned about axes for Rural America. Currently the rural areas are most hurt by the status quo inri terms of low traffic towers, a Traffic Control towers, many of which are the first to be cut iu any budgetary cutbacks. So Rural America, access to Rural America would actually be enhanced if the air Traffic Control system were taken out of the bureaucratic government budgeting and procurement processes. Well, i guess youll think i would add is, as you would understand, look at the composition, a lot of people represent rural states that are with a lot of geography, smaller tumors were generally the aviation is very important. I like you, i think sherry concern that rural areas bee treated fairly and that there be safeguards put in place. I guess specifically my question was to what safeguards in the administration proposal, in what ways would they go about insuring that rural areas will continue to have access and have access to the nations ssn wouli be affordable . So if you have, maybe at this point since theres no legislation specifically to look at sort of game that up at that something a lot of people on this committee would be interested in knowing about. There were editorials in yesterdays Washington Post and several other papers that echo the president s call to spin out the atc function from the faa. They note the basic concept has been around for a long time, as enjoyed support by both immigrants and republicans at various times dick still there some equate the need for major change. What would you say, for instance, to those argument nextgen is working out fine andd that reforming the atc system will actually slow down the modernization process . We respectfully disagree. The men and women who work on nextgen are doing their very best pick and we do not want to criticize them. But the nextgen effort has been going on for quite a while. It has expended billions of dollars and we are still facing many, many delays, congestion, procurement issues that existed decades ago. I was a deputy secretary of transportation in 1989. Coming back into the departmente in 2017, i am hearing the samedh arguments, the same descriptions of the problem as i did then. The procurement issues are real, and we need to make sure that the heart of working men and women have the latest technology. Right now the air Traffic Control system is still operating from vacuum tubes and also paper strips, in an age where we have Digital Technology available. So we need to again equip our treatment this air Traffic Controllers with the best tool that they have going into the future. Senator nelson. Madam secretary, we will just have a disagreement on this, and i appreciate the position that you have to articulate for the administration, for the white house. And entirely respect you as you go about your duties. I would point out that one of the reasons for the delays on the nextgen, implementation, is a lack of money. And lack of money also gets in the way, for example, a lot of e rural airports are covered by contract towers. They are not faa. And we went through that drill a couple of years ago and had tof really get with it because somec of those contract towers were being cut out simply a savings. A lot of the rural airports that dont have them now would like to have contract towers. But again is a function of t money. I dont think that when you compare that to the organization of the implementation, that that is a reason why you suddenlyts turn all of the government assets over to a private entity. That is my opinion, and we will certainly in the crucible of debate and amendments proceed and see where it comes. T i want to give most of my time to the other members, because its pretty wellknown where i am. But before i turn it over, i just want to give you another topic for your consideration. En takata airbags have been linked to 180 injuries and 11 deaths. Several of those have occurred in my state. Last week we released data from an independent monitor that y showed that after two years of a nationwide recall, twothirds of the cars out there still have not been repaired. I and it appears that since you were sworn in, madam secretary, the national highway trafficic Safety Administration has not taken any further action to speed up the process. Last friday chairman thune and i sent you a letter requiring additional action to get the process moving again. So i wish you would be refreshed on the contents of that letter and see if you could crack the whip on nhtsa to get them going. Do you have any additional detail or steps that you might want to share with us at this point . Senator nelson, thank you very much for the letter that you and the chairmen have sent. We in receipt of a letter. It just came in the last few days. We understand this is a concern to you. This is also a concern to us. We hope we are working diligently on this issue but obviously its not fast enough. E and so thank you for reminding us, and, indeed, i will go back and we will redouble our efforts. Thanks. Thank you, senator nelson. Senator wicker. Well, its wonderful to see you again, madam secretary. Let me just say with regard to the airTraffic Control is proposal, that this is a toughh sell in states like my state of mississippi, where the small airports are very concerned about where this will leave them. And i think youre going to see this on both sides of the aisle. So the sale needs to be made in needs to made convincingly. What assurances can you give us about the fear of higher airfares and higher fees resulting from this proposal, particularly in light the fact that the privatize model in canada and United Kingdom found that after the first six years, in candidate there was a 59 increase, increase, and in the United Kingdom, a 30 increase. I think canada actually had a 30 decrease in user ease rose 30 according to a y study study that ive seen. But your testimony is, in fact, that the has decreased . For general aviation, which i know theres an area, its a group that is very concerned about let me just say that something we need to nail down. Okay. And folks back home need a Comfort Level about what this might result in. What do you say to the statements, and let me turn into a question of senator nelson, about the effect of this on the contract towers . And can you comment on the value of contract towers . The contract towers are very important to Rural America. So let me emphasize again, i understand and i am very, very concerned about the impact on Rural America because i come from a state that is rural. I know that the majority of the members of this committee come from rural areas and rural states. So i take advisement very sorry sleep is concerned how to address the rural issues. A the ironic thing is the contract towers are actually much better. If the governance system were separate. For example, how do we know that . Contract towers are the first to go in any budgetary cutbacks. When we had sequestration, when there is cdrs, when theres uncertain budgetary demands as senator nelson mention, its a matter of money of the contract towers are always the first to go. And yet they are so important to Rural America. So that the airTraffic Control system were to be separated, and they were able to have much steadier budget, budget scenario, the threat to the contract towers actually drop and that would be very good for Rural America. We will be visiting about this over time. Let me shift in the minute and a half i have left. We had testimony from the air force yesterday about the global shortage of pilots, and certainly that affects the civilian sector, too. Here in the United States and with all of our allies. Can you comment and do you have any specific recommendations about what your Department Might do in working with all concerned entities to address the Pilot Shortage . And the adult that there is the 1500 hour rule was put in by congress and it said a much higher standard for the number of hours obviously that a potential pilot has to attain before they can enter into service. So thats really an act of congress, and theres very little that the administration with the executive branch can do about that. Let me say theres a larger problem though, and i would direct your attention to the problem that general goldstein mentioned yesterday, the chief of staff of the air force. There is just a shortage across the board in the military, in the air force come in the navy, in the United Kingdom, in the air force and also among the commercial pilots. Theres an overall shortage, which we and our friends are going to have to deal with. So i would simply ask you to go back to the department and see if we can come on the civilian side and on the military side, the part of the solution because it is a serious problem. If i may come a as a former secretary of labor, what we are talking really about is skills gap. Theres a largeish about a skills gap in our economy. So i share share your concerns about the pilot and the shortage of their of and where are we going to get them in the future. I would love to work with you on that. Thank you maam. Senator cantwell. Thank you, secretary chao, for being here and thank you for etching questions about contract towers. Nd you can see is a very hot topic with our colleagues. Thats because or 250 contract towers in 46 states. I think just about every part of the country is interested in this, and given senator wicker question about the value, i would assume then you would be willing to say that you will protect this contract towers or matter what . T . I cant promise you that now because under the currenter wha . Budgetary process, its an issuh of whats available dollars. Is that what youre asking . Yes. So thats why, thats why the proposal of separating out airTraffic Control from the regulatory safety part of faa is to address some of the budgetary issues as well so that this new entity will be selfsustaining. It will be self financing, and it will not be victim to the vagaries of year to year annual appropriations. Are you saying thats good for the contractt towers. Are you saying they will not get protected unless we do thatu under the current to ask about under current budgetary process . Yes. Im not saying that i wont protected. Im just saying i cant guarantee that because it depends on the budget that you give to me and what you ultimately decide. Etary pr okay. Well anyway, i would hope you would protect them no matter what. So on the nextgen system, do you know if the president infrastructure plan supports investment in just nextgen . I hear what you are saying about the airTraffic Controllerg system, but just on nextgen. Obviously one of the things we struggle with your is we get all the players and they sit at the heavier sitting at now and they debate amongst themselves. I mean, i wish we could make and stayed there until we got resolution of funding issues, but thats really what is hampering the implementation of nextgen. So does the president s infrastructure plan include making some investment in nextgen, to . The president infrastructurep proposal has as a major part of it the separation of the airTraffic Control system from the regulatory safety aspect which remains with faa. R traffi so in fact, the modernization of faa is a cornerstone of the infrastructure project. F at again there is an Aviation Trust Fund which we cannot use them even though it has huge surpluses in there, and because have not been appropriated, and is also the whole issue about financing and the budgetary process from year to year and how uncertain it is, which impedeimpeaches the ability of o plan further ahead. So this whole issue about finding certainty is tied in with why the separation will be good to maintain a more robust airTraffic Control system. But again im not here, here to work with all of you because i know this is a controversial issue. I know there are concerns. I am with senator nelson and respect he is a nextgen is paying dividends, so if we get to this point will be dont get there on this discussion, we hope we will keep making progress on implementation just as we did under the lastprogre extension bill. Yes, it would. Thank you. I have one more question. I know its related to more broader freight but ou are cargo freight issues at airports. We recently sent a letter about the National Freight and i would grant program. Are expecting to make a second round of freight grants this year . We hope other grants has been under review because of the new administration. So we hope to finish the review quickly and then get these grants out as quickly as we can. So you think that would happen this year . I sure hope so. Thank you. F senator fischer. Kl thank you, mr. Chairman. Tk welcome, madam secretary, nice to see you. I think you just mentioned about the need to have a longer planning. , and a longer reauthorization. When it comes i think you all infrastructure, not just with regards to air service and airports but with all infrastructure. And i hear that from stakeholders across nebraska as well. Because it takes a long time to plan projects and then get the permitting done and then to go through the construction. First of all, do you agree with that . And if you do, what are you going to do to help us get to that longer planning phase when it comes to infrastructure . Well, it certainly would help if its a longer period that committee can come to some consensus on. If indeed the faa reauthorization for a longer period of time, i think that would alleviate a lot of, relieves a lot of pressure. And as we look at air services, specifically in access thats very, i know you mentioned the needs in Rural America and its very critical that we have that access to our communities and to families and businesses so that they can take advantage of opportunities that come with having their service. I am concerned about the elimination of the congressional appropriations for Central Air Service in the president sns foc budget request. Can you tell us what the administration plans to do, what their intentions are, concerning Rural Communities . How are you going to ensure that these rural areas in america still have access to air services . We had seven Rural Communities in nebraska, and as you know we are a large state and sparsely populated. If Rural America is going to be able to grow and thrive, essential air service is a big part of that, so what are the intentions of your department with regards to that . It is unfortunate that thee t program was restructured the way it is. I am working within the administration to see how we can address that. And im hopeful that i will have a partial solution to this pretty shortly. I would be happy to work with you on that as well, and i know there is many members of this committee for the essential air service plays a big part inthe t keeping areas in our states connected and continue continuew and have opportunities for Economic Growth so i hope that you feel free to reject any and other members of this committee to try and work through the problems that i see with the request that it come down from the administration. I am pleased to hear that the president has talked about the importance of Regulatory Reform as a way we can address Infrastructure Investment and also Freight Movement across this country. Ve sometimes when we look at federal regulations they are pretty prescriptive where the government will dictate in is how things are going to happen. And i try to look for ways that we can look at performancebased standards so that we can involve stakeholders and develop more innovative methods for achieving a regulatory goal that is put out there. Do you agree that performancebased standards could facilitate innovative compliance and Safety Technologies . And if so, has the department of transportation reviewed how it could move away from these more, prescriptive regulations to ame more performancebased series . W we are in total agreement on that and we hope to move in that direction, yes. Do you have any examples of ways, specific ways youre are g at addressing some of those right now . There was an executive order from the white house dated i believe it was federally 28th, and it was an effort to look at all of the regulations from a status quo pointed if you that have been just issued. As you all know everything wast frozen for 60 days and we look at that. As part of infrastructure project, the proposal, were looking also at the permittingoo side and were going to have, announced some of it, and thus may be too ambitious a board but there be a day devoted to how can we work with some of the permitting issues . For example, i do want to court for too long, some of these permitting issues are, we all respective private. We all want to protect the private. Some of these permitting issues occur sequentially. Does it not make sense to have some of these permitting procedures occur concurrently . So very simple issues like that can make a big difference. So we are, in fact, having a gathering of mayors and governors at the department of transportation this friday on this particular issue, and we hope to have some further consultation dialogue and discussion about it as well. Thank you very much. I would just add my concerns about the contract towers and looking for a way that we can continue that. Thank you. Thank you, senator fischer. Senator blumenthal. Thanks, mr. Chairman. Welcome back, madam secretary. At the outset of want to thank my colleague, senator moran, for working with me during a previous session on the contrack tower issue during the continuing resolution. Consideration. And we stated then and i will restate now my commitment to working across the aisle on this very important issue with my colleagues. In a seemingly minor issue, i just want to have vast ramification for country as you well know. I have been discouraged as many of my colleagues have been by the lag in responses to some of her injuries. There was a report in the politico very recently that officials from the white house were telling Agency Officials to ignore oversight requests from democratic members of this congress. Do you know of any such contacta and that you had such discussion with white house officials, madam secretary . Well, first of all, i think you all know that based on my reputation ive always worked very hard to ensure that whatever department i am leaving, that it would be working very well with both sides of the aisle on issues we pride ourselves in being very responsive, and i have a history of working collaboratively with members of congress. Let me ask you then, i hate to interrupt you but my time is limited. I wrote to you two months ago just days after the now infamous incident involving United Airlines, demanding an investigation into the issue that was raised there. W dot had publicly was reviewing that issue and i asked for answers about the airline employees knowledge of passenger rights. In fact, ive helped lead the effort to improve those rights to a new passenger bill of rights, which i hope you would support. But in the meantime i have received no response to my inquiry. What is the status of that investigation . Im sorry you did not receive a response. Im not aware that, i will take a look. Nq i was good to say having said what i just said, its actually not unusual for the administration, every administration including the Previous Administration, that any oversight responses be coordinated through the chairman and ranking of each committee. So thats separate from like ordinary kind of correspondence took oversight is a big difference and this has alwaysco been the policy through all administrations. Im very skeptical. I had to say with all due respect, about the plan that has been advanced that would providd for socalled reform in a system that is seen no for talent on a commercial plane since 2009. I am puzzled that the administration wants to breakk apart the faa and put the critical safety oversight role, air Traffic Control, into the hands of an unknown untested entity that in effect will be controlled by the airlines, particularly since nearly 40,000 people are expected to die on our roads every year, and the administration has yet to propose a specific set of measures to build new roads, rails, bridges and other infrastructure i in decamping President Trump promised to replace our quote obsolete end quote rails and tunnels with the quote gleaning end quote infrastructure our country deserves. So i am wondering why the priority on breaking apart the faa when we have yet to see any specifics, in fact, i cut in the investment on infrastructure in the 2017 budget. I wonder if you could explain what the impact will be of the cuts that are contemplated, for example, in the Tiger Program and other programs within the jurisdiction of your department . The separation of faa air Traffic Control from the faa regulatory safety aspect is a cornerstone of the infrastructure project, proposal. The current budget of 2018 does not reflect the priorities of the new infrastructure proposal here so the projects that were cut in the 2018 budget, in fact, will be realigned to newer priorities in the infrastructure proposal. Let me also say that speedy are you saying that tiger would be fully funded and amtrak will be fully funded, in fact, increase on it will be a different kind of funding, as was announced that the infrastructure proposal will be 1 trillion over ten years. He left 200 billion dollars of direct federal funding which is far higher than the past highwae bill of december 2015, and it will be, it will be leveraged through publicprivate partnerships and possible sales of government assets. When will we see the specifics . Hopefully soon. Wi we came out with principles and so we hope to have the legislative language, to be on the congressional schedule, probably Third Quarter of this year. My time has expired. Thank you, mr. Chairman. Senator moran. Mr. Chairman, thank you. Madam secretary, thank you for your presence today. I appreciate senator blumenthal recollecting the efforts to make certain the contract our progran was funded. That occurred back in 2013. I would remain skeptical, madam secretary, you indicating that Rural America and particularly contract tower programs would be more secure with privatization of air Traffic Control with the board of 13 people. Based upon my experience in dealing with this issue in the senate, as i recall to restore the funding for that contract our program there were 26 democrats and 25 republicans who joined together in offering legislation, and a member on the senate floor. So a majority of the senate, a fact the majority of both republicans and democrats in the senate put the efforts together to make sure contract towers were supported. And i would put that, i would put the risk of the survival of contract towers in the hands of Congress Much what easily than i would put in the hands of a board of 13 people making decisions nationwide. 1 i think one of the problems with privatization is the removal of congress from having a role to play, and particularly as, by world what i think i mean by that is almost anyplace except for the largest cities in our country is rural. And so i would put my eggs in the basket of asking congress to be supportive of real programs much more readily than i would put my eggs in a basket of a 13 member private board. I want to comment on your statement about, along senator fishers question, a long the reauthorization is a good thing. Boy, i shar sure that you and is very disappointed that we are unable in this committee to ultimately get a longterm faa reauthorization bill passed through the Congress Last time. H but the reason we are unable to do is this topic that now is in front of us again, privatization of the faa. Ason we so, madam secretary, if it becomes clear that the votes are not present in this committee or in the United States senate, will then you help us past and faa longterm reauthorization without the privatization sen provisions . I wish i can answer that question but as you all know iw cannot. Perhaps im only making a point and perhaps it was rhetorical question, but the issue that now faces us is the same on the face of celestine. O and effect with the administrations support of this concept, the chances of getting a longterm faa reauthorization in my view have now beenion in diminished. So some point in time thee decision is to be made by you and others in the administration, is our priority a longterm faa reauthorization or is it privatization of air Traffic Control because thosese two things may be mutually exclusive. And that i want to thank you for responding to our februarye this letter, senator klobuchar and i wrote you asking about your assurances that your comments in your confirmation hearing about reaching a National Consensus on this topic. We received a response last night and i thank you for answering that letter. Im not sure theres a National Consensus on an old effort was made to seek input from a variety of interested parties when it comes to this topic. And then finally on a different topic, let me ask you about spectrum allocation. Madam secretary, one of the significant recentnt accomplishments that senator udall and i worked on was to expand the Spectrum Reallocation Fund to include a 500 million pool for research and development. Im pleased to see the faain recently announced it is taking advantage of that pool to investigate whether the it can relinquish some of 1300, 1350 megahertz band. Thats encouraging. That will free up more spectrum if you reached the conclusion to deploy nextgeneration Wireless Networks 5g work could you bring me up to speed on your thoughts and the status of that effort to that investigation within your department . The investigation ised extraordinarily complex, i dont have a good answer for you today but i will get one for you. Very good. Madam secretary, thank you again. Inarily thank you, senator moran. I now have an order of appearance, senator schatz is a longer here. Send it in off. Thank you, mr. Chairman. Senator inhofe. Let me first, secretary chao, talked a lot about their other issues other than just the privatization issue that is out there. E. I think, i have severall questions that should be asked. I want to make one comment though about contract towers. I agree with the comments that senator moran made, major request i have of you is, if this becomes a discussion in the administration id like to be a part of that discussion here weve had very good successes with our contract towers and we would be come have a serious problem without. Does that sound reasonable to you . Yes. Okay. On that issue, of the privatization, i think almost every question i could ask youve already answered but ii would like to know if there is just a short answer to specific reason why nextgen would be better served under the systems you are proposing . Is there a short answer to that . Because i have not yet heard one that really makes a lot of sense to me. We can procure new equipment faster. Thats the short answer, all right. [laughing] because a Government Procurement rules are very bureaucratic. By the time the federal government gets the equipment,ee many times its not stateoftheart modern Technology Just because of the lengthy procurement process. On monday, and i didnt attend but i did read what the president was saying about the proposal. The one thing that was not mentioned was having to do with the user fees. One think about the house bill. It specifically excluded user fees in certain areas, starting. With general aviation, then it gets more confusing when it goes up from there because of the quasigeneral aviation organizations that are outorgani there. So i didnt, it was not directy excluded in the presentation that you folks had on monday. Any comments about that . Your assessment is correct. As i mentioned we look forward to working with the committee and congress, and this is a point that needs to be discussed. We are willing to do so. All right. The next thing i want to bring up is with talk to your staff quite a bit about a proposal that i have that we refer to as the flight acts. What this does is give assurance to general aviation airports, those who receive 150,000 a year, to do a number of things, including extending that about from six to seven years, yes, six to seven years. And also assuring that if there is a surplus in those accounts, that they be reserved source general aviation and airports as opposed to others. Thats one provision. Another provision, i chaired a committee when we had the fast accurate one of the things we successfully did in concert iio might add was the Ranking Member Barbara Boxer come was to some of the environmental streamlines put into effect. I think we could do and we could emulate pics ive done that in this legislation. And weve also, well, actually i dont have time to get into a lot of detail on this. But have you had a chance to review the flight act with your staff . We have become interested in specifically what you have in mind. We can have an offline discussion after the hearing. That would be good. Senator booker and i were interested and it actually worked together on some of the drone legislation that we that in the past. Weve been successful if we got language in there that willpa allow drones on the nonline of sight environment take care of problems that are like pipelines in other areas that have been successful. While the faa has established a process to address such applications, and application for such nonline of sight applications, the faa has approved very few of them. I am concerned about this. Is anything that you can think of that is causing the faa to be a lot slower than they should be in this respect on drones . I think they are trying to be very deliberative, very careful. And their kind to take into account all the different viewpoints. But you and senator bookers concerns about this issue is registered with me today, and i will go back to faa and talk with him further. I appreciate that and maybe let us know what the response is. Take you very much. Mr. Chairman, with the city to yield for a point of clarification . With the the faa is exempt from the federal procurement rules. This was set in the 1990s. So in your examination of the procurement rules, and whether or not there are delays, i point that out. You want to look at the faa specific procurement roles. [inaudible] they are dragging their feet and this should be done much more expeditiously. Thanthank you, senator inhof. Next up is, he is returned, senator schatz. Thank you for being here. It seems every week there has been a new episode of passengers on airplanes being treated unfairly and its created a new pair of debacles. But every instance is an example of airlines violating the trust of their customers have put in with their dollars. I would like to get your perspective of what you think the department of transportation can do and what we ought to consider doing the reauthorization. I know this is a delicate space because it is a private enterprise, and we dont want to be too prescriptive but from my it is difficult to understand the meeting of the minds when someone clicks agree on expedia or an airline so i would like your perspective on what ought to be done, what should be gotten done with your department. Ave ke in light of what happened, we have kept track of the incident and created a whole new section of the dot website that informs the traveling public what their rights are as passengers and what they can expect and demand in regards of lost luggage, overbooking, delays, so we have tried to help theub traveling public to know what their rights are. That is on our website. I am not sure what the protocol is, but i will make this point. They did indeed supposedly streamline Government Procurement, but having done all of that the procurement of faa equipment is still a problem. We are still dealing with paper strips and a long gap of what we need to do so without being disrespectful, i wanted to respond that there has not been much improvement, unfortunately. Think you. I wanted to talk to about drones and drone registration when mr. Lawrence testified on march 15, he shared more than 750,007 small u. S. Owners have registered their drones. Congress is happy about this accomplishment in relatively short amount of time and were looking forward to getting to one 100 there is a wrinkle because the u. S. Court of appeals ruled the faa regulation requiring drone registration for Recreational Use was illegal. I basic question is, what are we going to do next . We have not yet decided. C the Decision Just came out a few days ago so we are in the process of reviewing and evaluating what our next step is. If you have specific view points, we would be pleased to work with you. If you could consider this request for Technical Assistance on the question of whether or not we need to make any statutory changes. Ha drones are exciting. From a civil dispense perspective, from a recreational perspective, there are lots of great opportunities, but there are new issues and i think its important to make policy and not the vault all of our authority to the executive branch. Since the authorization bill is alive vehicle, its an opportunity to make policy on a bipartisan basis. Senator fisher mentioned air service, and i think i can speak for nearly everyone on the committee when i say the proposed reduction in funding to 108 million in fy 18 budget is alarming. I would like to get your reassurance that you understand how important this is to the committee and that we will work to make sure essential air service is part of the basic promise that the department of transportation makes to our constituents. I certainly do. The budget was put together in the beginning parts of the administration when many key members were absent. Think you. Next up is senator marquis. Thank you very much. We have a situation where airlines are overcharging captive passengers just because they need to change or cancel their flight or check a couple of bags. Its not fair to the passengers across the country. Today, several airlines actually charge 200 to change or cancel. That might be greater than the value of the ticket which the person purchased. On top of that, many are charging me as much as 25 for the first check by a, 35 for the second so that could be up to 120. Roundtrip for that bag. The fee epidemic is a growing. Carryon bags, print boarding passes, blankets. The reason they can do it is theyre not operating in competitive situations. For airlines now control 85 of the traffic in the skies. An analysis from the u. S. Travel Association Found that 74 airports are served by only one airline 155 airports are dominated by one carrier controlling 50 of the seat capacity. The result is the airline reap fourpoint to billion in baggage fees. 2. 9billion in cancellation fees, just last year end passengers are demanding some relief. They are put in situations where they can be tipped upside down at the desk. What can the department of transportation do to give relief to these passengers . As i mentioned, we try to give people, weve posted on our website a passenger bill of rights but these are a frustrating issue. Weve all traveled, we all have experienced it. I look forward to working with you. Thats what im afraid of. You can only get people notice that they dont have any rights. I think as we do this faa reauthorization, senator blumenthal and i are intending to ensure we make an amendment that gives passengers rights, gives them protections. We want to make sure the farest are fair and reasonable and proportionate to the cost of the service being provided we do try to help passengers and we put the passengers bill of rights their back these are issuesch ai that do emerge and we really cant do very much about pricing. We want to work with you. Thats the point that im making we need to pass legislation so there is a definition of what is fair and reasonable and proportionate. Over on it the whole world is operating but Southwest Airlines and Delta Airlines experienced Technology Issue that resulted in thousands of Flight Cancellations across the country. Last summer, earlier this year, delta and United Airlines had two large outages within a week causing even more flight disruptions. The airlines it systems still havent been brought into the 2t century. Weve also found airlines have not fulfilled their obligation to take care of the stranded passengers when there are cancellations and delays, many do not have internet Airline Agreements in place which allow them to book stranded passengers at no additional cost to the consumer. It will be critical for us to deal with this issue so the airlines understand its critical for them to up trade their it services. In many instances they dont even notify passengers they have a right to compensation because of the delay or the cancellation of flights. They are not expressly notified. Can the Department Help on that issue . To make sure the airlines. Passengers are supposed to be told they have a right to compensation. As you may have heard, a number of airlines, in response to a recent incident on united has raised compensation for overbooking up to 10000. From my perspective, when i look at the airlines in their own it systems, and their need to be upgraded dramatically in order to deal with all these issues, and then i look at a proposal to give the airlines the preponderance of the control of that board, to move us back to the 20th century, if they cant upgrade their own it systems, if they cant figure out how to do it for their own passengers, to give them the key seats on this kind of a board seems to me, given the record of safety of the existing system would be, from my perspective sequentially wrong. First they should prove they can do all of these things for their own passengers before were giving themof responsibility for taking on all of these larger governmentally controlled responsibilities. We thank you for your service we will have a big debate on this authorization. Thank you. Thank you. Thank you mr. Chair and Ranking Member and welcome secretary chal. It is good to see you. See you as you know, earlier this years there was a truly unfortunate incident with United Airlines forcibly removing a passenger from an aircraft, bringing new attention to Consumer Protection will lacks that exist. It does not represent a onetime situation of mistreatment of passengers. There have been several incidences between that in todays hearing. Dot received over 17000 complaints across the industry and those were just the cases reported. I am sure you join my a colleagues and me in finding these unacceptable and its why i introduced the ticket act with several of my colleagues. This will improve policies, guarantee paying customers have a right to fly and it makes other common sense reform. Does the department of transportation share my concerns and that of people across the country that more needs to be done to ensure better flying conditions for consumers and specifically, how does your team plan to oess this . Of course we are concerned. What has happened, obviously, is inexcusable. We have alerted all of the airlines of what their responsibilities are and we have posted a passengers bill of rights so individual passengers can access the website and as we go forward, we want to make sure also that the airlines understand what their responsibilities are, and its its in their own best interest to treat passengers with respect and courtesy. I think that effort is ongoing and the Airlines Need to take that responsibility on themselves. Thank you. You and your staff will work with those above sponsoring the bill to look at the elements and see if it makes sense to incorporate them into the faa reauthorization. Thank you. Last congress the house of representatives put forth a proposal to privatize air Traffic Control system and change the way our nations airspace is governed. Senators on both sides of the aisle has raised questions on how and whether the plan might work. As we assess changes to the current system, we have to make sure safety remains paramount and we also have to be mindful of the impact privatization could have on smaller and more Rural Communities like the ones i represent in new hampshire. Of in march of this year they wrote to the leadership they noted their concern that commercial airline would be essentially governing themselves which would devastate rule and midsized communities where its harder to attract robust service. Secretary chao what is the president s plan if any to safeguard communities should major changes take place to our air Traffic Control system. Thank you for the questions. I want to make very clear because i think theres a lot of concern. This new Traffic Control system, if it were to be taken away from faa, so that the inherent conflict of interest which currently exists which is that we have an air Traffic Control operating system that is regulating itself on safety, that is an intrinsic conflict of interest. We need to separate out the safety function from the operational function. Number two, this new air Traffic Control system is not going to be controlled by airlines. What the president s proposal merely says is that there willt be a new governance and financing structure. That will comprise of 13 members and only two seats are available i airlines. The restlessly filled by airports, labor groups, labor representatives, general aviation will have at least two so itll be a whole state code group. There responsibility is not to look after their parochial interest, but to look after the interest of the whole air Traffic Control system. Rural america is very much a part of that. Were very much aware that the members of this committee come primarily from rural states. It is an issue we are very cognizant of. As we go forward, weve now released this proposal. We we look forward to working with members of this committee and the senate and thef congress on this issue. Thank you. I think it will be veryf helpful if we can include mayors and governors as well. We are meeting with them this friday. Thank you. Tha thank you for being here and taking time from your busy schedule to answer some of our questions. Can i change directions for just a minute and talk about drones. Its an issue ive been working on the last couple of years, and its important to the state of nevada because its one of the six nationally recognized Unmanned Aircraft system test sites. You are probably familiar with that. I think our state is the Perfect Place for commercial testing and i think its proven so because of the states expertise. We have 300 days of sun in nevada and there are low startups and operational costs. Ive worked with my colleagues during the last congress from states other sites and their support through 2019. Fortunately, its my opinion that the Previous Administration, the faa did not utilize the test sites to the best of their ability. My question for you is to ask if you support extending the authorization and these sites beyond 2019. That is the question which i did not anticipate. Is i will go back and take a look at the issue. There was a folder on my table but i didnt think it was going to be asked today. Anticipate a followup and thank you for that. One of the reasons we need the extension is the ability to conduct these tests beyond the line of sight. Right now they are limited. They have to be able to see the drone and actually its prohibited to testing these things if youre only limited to line of sight. In fact some of the commercial companies that are being tested right now are saying ifif they cant go beyond the line of sight, they will have to do their testing overseas. That is the concern we have and i just wanted to see if you had any insight or do you support any testing that would be done outside the line of sight. Im cognizant but i hadnt linked the two together. The other issue is having drones fly over the head of populations. We are looking at those two issues. Could we have to come up with something that is very common sense. As you are well aware, there are a lot of drones out there. You can walk into costcolo tomorrow and buy yourself ayo drone and start flying and one of my sons, its just the latest and greatest and he wanted to see how these things work. Now he has learning the restrictions of what you can and cant do. I think there are some real possibilities in the future and i just want to make sure nevada stays in the forefront of this particular issue when it comes to commercial use and being able to work on this issue. It means a lot to our state. That be great. Theres actually a difference between the commercial and the hobbyist. Most commercial operators understand very well what the rules are. Its much more the hobbyist. He is a hobbyist. Because of recent court action that just came out, we are reviewing this whole issue of how to deal with hobbyists and their concerns. I would like to you on that. I think there is a group of millenniums that have to be aware and educated of the use of these things and the practicality of it. I do know there restricted around airports, in fact i was with him one time as he was flying it and it just stopped and its programmed up to every airport in america how close you can get to it, that drone will stop and hover and wont move forward. Its fascinating to see that the technology is there forhe the necessary protections around corridors that are little more sensitive than others. I understand. We look forward to working with you. Thank you. Thank you, mr. Chairman. Thank you madame secretary for being here today. Its always good to see you and we appreciate all the work youre doing in the Auto Industry as well as what were doing here with the faa. I want to start off and just add my comments to what i think is incredibly importantin for my state and clearly important to other senators. That deals with rule airports. Michigan is a very industrial state and were proud of our Auto Industry but we are also an incredibly rule state. I know you responded to several questions related to that but it goes back to the privatization of air Traffic Control and in your opening comments you talked about that type of privatization would help rule airports, if i got your testimony right, that it will be able to preserve contract towers and some of the smaller airports, there wont be any sort of movement away from Regional Airports, excuse me well airports and larger Regional Airports but we have a budget put forward by the president to cut essential air service which is truly essential in these small communities. Without airplane service its difficult to attract any business to have economic development. Its a major negative for the rural areas of our country, and if we are moving to a privatized system, its basically run by the airlines who are profitmaking entities. The reason they dont serve these rural areas is because they dont make money. How do you square that . How do you square that theth administration wants to cut essential air services and yet says actually privatizing air traffic system will help rule airports by putting the Major Airlines that dont make money. Help me, walk me through this. If i may, these are actually two separate issues, but having said that, let me assure you that the interest and concerns of Rural America are ones that i share. It was part of the budget for fiscal year 2018. I can defend it but i will say that decision was made when a lot of people. We are very concerned about Rural America. Some of the issues with contract towers is actually an issue of budgeting uncertainty. If you take it out of federal government the budgeting certainty will actually benefit rule america. In the third issue is the new air Traffic Control system, the structure that we are suggesting through the administrations proposal is not one thats controlled by airlines. There is a board of directors of 13 people, and only two seats of the 13s are to airlines. The rest are to airports and laborers and advocates. Its two other stakeholders, so this is not controlled by the airlines. I think thats a very importan important i appreciate you bringing that up and we will have to see what the actual legislation states to have fuller discussion about this. I appreciate that. With the recent attacks at airports in Fort Lauderdale and brussels, it is clear we need to do more to protect our airports and the traveling public from attacks. However, i have heard from airports that they are frustrated that the faa of the tsa cant agree who is responsible to help airports meet their security needs. Putting the public at risk is quite frankly, unacceptable. One issue ive been working on would provide airports greater flexibility to use passenger facility charges to improve their infrastructure. I know for airports in my state, if money were no object and they had flexibility, they would already be investing inng various Public Safety initiatives such as ballistic protective podiums permanent force protection barriers along with curbside dropoff to protect from vehicle borne attacks like the one we tragically saw in london. Additionally we should look at allowing airport improvement programs to be used for perimeter systems. Just your sense, does that make some sense to you . That we look to provide greater flexibility for our airports to provide the type of infrastructure necessary to protect passengers going through them. I think security is very important, obviously. So much of this with the passenger facility charge is really up to the congress. Thank you. Thank you senator peters. Next up senator gardner. Thank you for your time and testimony today. I truly do appreciate the opportunity and last congress they passed a bill called the screen fast act. I encourage the faa and the tsa, obviously two different departments to continue their Work Together to implement the screen fast act and the opportunity it has to develop new technologies and how we make sure our passengers are secure and how our airports are secure because i do think there are some opportunities for innovative security options. The opportunities are there for the faa and tsa to continue to Work Together on those new technologies. Secretary chao, in october, the Northern Colorado regional airport, working with the Colorado Department of transportation put forward a site for remote tower Pilot Program. The goal of the program is to demonstrate the airspace using t century technologies. One of the goals would be to include language. The faa would be would you support remote towers being eligible for funds. Yes. Thank you very much for that. Th the other question is dealing with Rocky Mountain airport. Revelatory challenges related to land use decisions make it difficult for these airports to operate. In Jefferson County colorado theyve been attempting to get faa approval to move forward with non federal parkway near the airport. The parkway is the final piece of the denver beltway that would go around the metropolitan area. Obviously a very critical transportation needs. They have significant challenges and this would help alleviate that. Faa was first requested for approval by the rightofway near the airport. It is my understanding there undertaking a review of the parkway even though its been a the subject of a 159dollar environmental study. In march of this year i joined with my colleague from colorado sending a letter urging expeditious consideration to resolve the issue as quickly as possible. Given the administrations goal of expedited approval, would you commit to me toto reviewing. I would be happy to. Thank you. The Denver Airport has been pursuing key Infrastructure Projects to develop its aeronautical landuse to raise additional revenue for reinvestment. Unfortunately they have run into red tape. Do you think theres opportunities to eliminate reform these burdensome regulations i can hamper this type of redevelopment and reinvestment. If so could you describe some steps the department is taking to illuminate the redtape. We are working on addressing the permitting activity of the infrastructure proposal. Many are very interested in helping to enhancing infrastructure, but in certain states they are actually discriminated against and unable to participate in the structure needs. Thats another area you didnt specifically ask about but we are at work on that. One example of how we can perhaps ease the permitting process without compromising Environmental Concerns is some procedures are occurring sequentially, whether we can have them occur concurrently. Something as simple as that can shorten the permitting process. Thank you very much. I dont know if senator leenk brought this up or not, but over the past several decades weve watched as Aviation Industries have made incredible strides and development of new airplanes and technology. Planes are safer, more fuel efficient and reliable. The u. S. Is a leader in that manufacturing and we must maintain that leadership. One area thats remained stagnant is the development of the speed of commercial aircraft. In colorado we made rapid advancements and i think theres incredible opportunities to pursue supersonic Aviation Technology that allows for safe and quick air travel over the United States far differently than pursued in the past that safe and reasonable. To have a position on expanded supersonic Aviation Technology. There are noise limits, number one. Nasa is working on this issue and to the extent that the noise level of the supersonicc flights can be reduced, that would meet current regulations, that is something we hope will happen. Thank you. Senator young. Thank you, mr. Chairman. Thank you madam secretary. Let me begin by commending the administration for proposing something new with respect to our air Traffic Control system. So often government falls into this space where we dont propose creative new ideas, even those that have been tested, tried and proven to work in other areas. I know we have to incorporate v the very valid concerns that i share about our rule communities and their service into this proposal, but as youve indicated, this modernization proposal may enhance safety, lead to independence between the t safety side and the Operations Side and the improved procurement. Hopefully we can improve themp proposal and make it something acceptable to more members of congress. I would like to turn to standards that your department is currently reviewing with respect to transportation of lithium ion batteries aboard passenger aircraft. I respect your request that you consider the impact of these policies on Public Health as it pertains to the transportation of lifesaving medical devices. S many of which are produced in the state of indiana, that utilize these High Standard batteries. I urge your department to carefully consider the implementation of anyio restrictions that would impede the transport of these lifesaving medical devices aboard aircraft. As your Department Review moves forward, i look forward to working with you however possible and your staff to ensure there are limited exceptions established to protect Public Health and provide the seamless delivery of lifesaving medical devices in Time Critical situations. Could you briefly offer your thoughts in establishing an exception. Lithium batteries can be a problem on flight, on airplanes. There is a problem of them instantaneously and spontaneously igniting and they dont need oxygen to keep burning and its very difficult to put it out. Thats why there is such concern about it. One of the Current Issues is whether these batteries should be banned overall or whether put in the cabin where if something did occur that the human factor, the human beings would be able to see something is burning and do something about it versus putting it into the cargo hold where it was thought originally to be safer, but if there is no human surveillance, then not actually makes it more dangerous. Let me assure you this is a difficult issue the administration is grappling wit with, especially from a Security Point of view. You bring up a new point which i have not heard being voice before. Let me have my staff work with your staff on us understanding more of that issue. Thank you. I think its worth noting that not all lithiumion batteries are created equally. Y. Some are more hardened than others, some are more stable than others, and these devices which are implanted inside human beings to improve their lives and save their lives are hardened with very low failure rates. It is my strong conviction they should be treated distinctly from lithiumion batteries found in a cell phone, for example. We look forward to continuing the dialogue. Its my intention to move forward with any improvements. If i could briefly turn to reiterating the importance of a dot program that is outside of the purview of faa. It is the Capital Investment grant program. Ities de back home in indiana, we have several communities dependent on the longterm viability of this transport program for projects like the south shoreline which provides a vital corridor from south bend indiana to chicago. Indiana communities have worked diligently to provide the necessary local funding for the transit program, and we believe any state matches are also going to be there. On we are depending on this federal Program Viability and continuance. Transi we just want to ensure the economic benefits of this program can be realized in communities like south bend, gary and east chicago indiana. On behalf of our bipartisan hoosier congressional area i hope you prioritize these improvements and do so in fiscal year 2019 annual report. I also want to invite you to visit the south shoreline in northwest indiana to see the potential of this line and its double track project in the Westlake Court or extension project. T. I know in your nomination hearing we discussed you visiting indiana and i was encouraged by your response and im hopeful that you might visit and observe this project. I look forward to it. Thank you so much. Thank you senator young. Next is senator cortez. Thank you. Chairman. Secretary chao, its good to see you. I appreciate you being here. It is a long morning and i appreciate you answering questions. Let me say this, thank you for the passenger bill of rights thats on your website. I found it after sitting for just under three hours on the tarmac on a commercial airline. It was there and thank you very much. A couple of things that my colleagues touched on, i just want to say for the record, while i understand your position on air Traffic Control privatization, like my colleagues, i have concerns that have been expressed by the dozens of mayors across the country, including from many of my rule communities, and one of the rule communities, boulder city, i want to talk about. In boulder city, there is a non towered airport that had about 100,000 Aircraft Operations in 2016. They have experienced several incidents where aircraft using crossing runways at the same time has have close calls. It was clearly at an important layer. There was an increase of 15 over 2013. What can i tell the mayor of boulder city, who is looking to be a part of the contract our program and whether it will exist and be protected for their potential benefit. Whenever there is a budgetaryy pressure, what happens is these contract towers become the easiest towers for elimination and cut back which is why, once again, the administration is making the point that the air Traffic Control system needs to be separate from the regulatorye part of faa. It would be selfsustaining. Its basically a change in the governance structure in the financing structure. Nothing will change from one day to another during the transitio transition. Either way, is boulder city assured they could obtain a contract tower whether we privatize or not, should they be able to rely on that benefit. I would hope so. In the new entity the rulent communities will continue to be very important and again, because of the steady budget process, there is actually greater chance of steady funding and greatest ability for programs like the contract p towers. Is that something you will be advocating for to ensure our communities are protected. Yes, because im always very concerned about rule b america. We would be more than glad to talk to them specifically. You heard from my colleague, we are looking for an extension of the programs in nevada beyond 2019. Im also curious, i want to make sure if you could lay out for me how much time is left. I want to make sure policies are not holding back any of the development into the research and regulation. I do not believe so. The hiring freeze was put into place as is the case with every administration when they first come in. None of the safety physicians are ever impacted by the freeze. I will take a look. Uld take i dont believe the project youre talking about has been impacted. You did talk a little bit about it with respect to the commercial users versus the hobbyists, and i appreciate that. I know youve stated recently, at a drone conference in fargo that the administration is working collaboratively to resolve the unique policy and legal issues in safely integrating drones into our airspace. Ha would you concur there are a number of unresolved conflicts about u. S. Jurisdiction, safety and oversight. Im not quite sure how to answer that. It is a new field. There are lots of issues with the line of sight and flying over heads of people, for example. Can i get a commitment you are willing to work with us to address the needs and that there is a fine balance and we are not hindering the innovation. Also, let me know or let us know in congress, is there a way, is there space for us to clarify the intent regarding the balance related to this space of Unmanned Aircraft if i can just get a commitment that youre willing to work. Easy enough. Thank you very much. Thank you. Ank thank you, mr. Chairman. Its good to see you. Thank you for being here. As you know, im a pilot. I have flown aircraft all over the world professionally for our country but as a private citizen, our air Traffic Control system is the best but the most complex in the world. Air Traffic Controllers to a phenomenal job in ensuring that u. S. Air travel is safe and efficient. The technology does need an upgrade, absolutely, but that is a procurement issue. If there is a problem with our system, its that congress does not guarantee the faa consistent and reliable funding to do their job more successfully. The fed they could procure theneed technologies they need far faster than the current rate. Ed when we last spoke, i highlighted that the goal is to provide highway and transit workers with the funding they need to make good decisions. In that same vein, if congress was willing to provide faa with funding certainty and speed up nexgen implementation and dangerous reorganization of our air Traffic Control o system by privatizing it. We are not canada or great britain. We manage the busiest airspace in the entire world. Its not even in the same ballpark. And yet, despite the great challenge the faa has made the air traffic system the safest in the world. Its safer than any of the example championed by advocates of privatization. I dont take our air Traffic Controllers for granted and i will not gamble with the safety of the public to address funding issues. I strongly oppose any vote to privatize the faa. The airspace, excuse me. E. As you know, transportation plays a Critical Role in connecting americans and communities across this country and to economic opportunities. Relate one of my Top Priorities is ensuring that communities benefit from the results from that investment so those jobs remain in those particular areas for this is particularly important if a worker is in low income and rural areas. In 2015, congress established a local labor Pilot Program lab that enables space and municipalities to consider geographic hiring preferences and labor preferences for veterans, highways and transportation projects. It has been renewed twice, most recently for five years. Yu would you commit to working with me to expand that Pilot Program to aviation projects. I dont know enough about it, but im always willing to work with members of congress. Okay, that would be great. Thank you. I think this is, if you look at the fact that it has been renewed twice, its a good sign of its success. I would hope we could expand it. Earlier this year, your officeda had a rule that would make it easier for consumers living with disabilities to know how frequently they damage critical mobility equipmentel like wheelchairs or scooters. I sent you a letter asking you to explain that decision to delay the rule, but you havent responded yet. In fact, you just told senator blumenthal that you have a reputation. Will you commit to responding to my letter. Absolutely. Thank you. Along that vein, as a former member of the House Oversight committee, i believe congress has a constitutional obligation to ensure that taxpayers dollars are spent wisely and we help foster an environment of any individual regardless of background to achieve the american dream. Sh i am deeply troubled that the white house ordered agenciess fr to disregard request from information from Congressional Democrats but im sure my republican counterpart see the folly in this direction. Both have experience in the minority. We commit to providing all congressional offices not justst republicans, with timely responses to request for information. Ul i always have, but this particular issue is different. Its an oversight issue. The oversight always comes from the chairman and the ranking. But weve not always required the chairman to sign off on the request. This is not a new practice by this administration. P it was followed by the Previous Administration as well. So why did they feel the need to issue a new letter . I request unanimous consent that this article i have on white house agencies to ignore democrat request to be at and transmitted to the record. Why would they do that. You have asked the white house. Thank you so much. Thank you very much madame secretary. I was there earlier and heard a few of your answers, but i wanted to reiterate, senator moran had talked about are concerned with air Traffic Control reform and i know we will be talking about those Going Forward and hes covered some of that and also the essential budget cuts that were mentioned. Focus on i thought i would focus on something that hasnt been discussed, the small airplane revitalization act. It was signed into law requires the faa to modernize certification regulations for small airplane the Senate Passed a bill last time to include provisions to streamline the process, and im hopeful this reauthorization bill includes important recertification reforms. I would companies be affected if they fell behind other d countries in developing new standards. We would not like that happen and we want to be uptodate and responsive so we continue to work on that. Thank you. I think its really important that we manufacture some ofp these and we really try to keep uptodate to compete with other nations. A lot of it is safety reforms, o as you know open skies agreement are an important part of the u. S. Transportation policy for all air carriers. Both administrations have pursued and expanded agreements which provided u. S. Consumers and carriers in airports with more choice. Senator isaacson recently sent you a letter about support for state owned carriers. You reaffirmed the value of the open skies agreement. Ps we are very concerned about the effect this will have on american carriers and american jobs. What steps are they taking to ensure the agreement is protecting workers from unfair competition. They are concerned about protecting u. S. Jobs. This is a complicated issues. We are consulting with one another and hope to have a decision pretty soon. That would be good because it just keeps getting worse and worse. Thank you. Safety isnt just about the quality of the planes, its also depends on our aviation workforce a retired pilot as we saw in the buffalo area is not just a danger to themselves but those in the air and on the ground. The safe skies act that i plan to reintroduce is something i introduced with senator boxer. It would take the requirements put in place for passenger pilots and apply them to cargo pilots. Currently they have looser requirements. What action is the administration taking to combat pilot fatigue. There are rules and regulations on the books already so we are certainly enforcing them. If has a different point of view or additional concerns about safety we look forward to working with you. Thank you. One last question, i recently wrote a letter urging the dot to investigate incidents of fraudulent and effective practices in the Online Travel and tourism marketplace. We know some deceptive Online Companies imitate the websites of actual airlines in order to attract bookings and theresct legislation on this. Fraudulent sites can leave passengers with airline itineraries that cant be honored and missed connections and lost money. They taking new steps to combat this new problem of Online Travel fraud. We are very cognizant ofog the issue and we are looking at it. I hope to have more staff in the future to help us address this issue. One last question, the extension bill required the department to take measures to allow families to sit together on a plane. There hasnt been a study yet. The deadline to establish policies is coming up. What is the departments plan. We are sympathetic to traveling public who have family members that are separated. It seems like the airlines themselves could take it upon themselves to do something about it or voluntary action in the cabin itself but we look forward to working with you on it. Thank you. Madam secretary, we appreciate your patience. We will wrap up momentarily. Let me ask a question regarding general Aviation Community which is concerned about whats fair under the new proposed system. They stressed the importance of maintaining access and feel all users of the system should pay their fair share. Does it ministration and vision the entity charging. Flight user fees on general aviation operators. Im so glad you brought it up. In my various previous statements, i had not mentioned general aviation enough when i was going and my testimony today with a mention of the general aviation interest. A we are very concerned about their concerns about the administration proposal. Ith maintenance of access is a huge issue. General aviation will be nominating two of the seats out of 13 seats. General aviation interest ande influence will be felt. General aviation also includes corporate jets. Thats a bit different than the momandpop single pilot that is flying around the country. We understand the issues general aviation is concerned about and we want work with them. Too that point, one of the Major Concerns they have is cost to access the airspace and whether or not user fees would be assessed, so theres a specific question about her flight user fees. That is a question. I think its open at this point but using one example, in canada, they currently just decreased, once again there fees for general aviation. I think its 65 for the year. Its quite low. Has youve heard today, there are a lot of westerns that need to be addressed and there is consensus on that particular issue. We are moving forward with our legislation. We would love to do a multi year reauthorization bill thatth would attract rod support of the senate. That was the case we had last time. I guess what i would suggest, coming out of this hearing is that you and your team and the T Administration make every effort possible to try to find consensus among the Stakeholder Community on this issue because its much easier to get consensus on this committee and the senate if there is consensus among those most impacted by any proposed changes. Right now, i think as you heard there are lots ofow questions on both sides about how the new system would function and operate. The more precise, as you work through this, the more clarity you will have about this committee and in a broader sense the whole senate might be. I know there is a great interest in moving forward in the house with this approach and we will be monitoring the action to see what they are able to do in responding accordingly. We wont wait forever. We will move forward. We are in the process of drafting legislation right now. There are range of other issues that affect aviation in this country, most of which we will address in legislation. We will continue to work with you and hear from you and your team on all of those issues, but particularly with regard to the proposal on air Traffic Control reform we would encourage you to reach out to the Stakeholder Community and try to find consensus to make it a lot easier moving forward. I think with that, we will keep the hearing record open for a couple weeks and if members wish to submito questions we laugh they do that in that timeframe to the degree that you can respond as quickly as possible, that would be most appreciated. Thank you for being here todayfo and for your response to the many questions raised by members of this committee. We look forward to continuing to working with you. Thank you. We look forward to working with you. This hearing is adjourned. Thank you. [inaudible conversation] [inaudible conversation] [inaudible conversation] [inaudible conversation] le conv] [inaudible conversations] [inaudible conversations] [inaudible conversations] President Trump today meet with the president of romania. After that the two link to hold a meeting at the white house. Were expecting question about james comey congressional testimony yesterday saying the president lied about his reasons for firing mr. Comer. A News Conference scheduled for 2 45 p. M. Eastern today live on cspan. This weekend booktv is live from the 33rd annual Chicago Tribune printers wrote that fast in chicago. Our coverage starts on saturday at 11 a. M. Eastern. Watch our coverage of the 33rd annual Chicago Tribune printers row lit fest tarting saturday at 11 a. M. Eastern on cspan2s booktv. The Arms Control Association held its annual meeting in washington, d. C. , and considered the best approaches to combat arms proliferation and previewed a Nuclear Weapons nonproliferation treaty conference scheduled for 2020. All right. Good morning, ladies and gentlemen. Good morning and welcome to the