Delta Air Lines Is Still Not Ready to Back ATC Reform Bill, Sources Say

Once again, much of the airline industry -- key airlines, the industry trade association, and a key congressional ally -- said it was closing in on reform of the nation's antiquated air traffic control system.

And once again, it remains unclear whether it will be possible to move ahead with legislation that lacks support from key players including Democrats in Congress, owners of private airplanes, several labor unions -- among them the International Association of Machinists, the industry's largest union -- and apparently, Delta Air Lines (DAL) .

Both Delta and the IAM have said they support ATC reform but oppose ATC privatization, which has been at the heart of the reform effort to date.

A privatized ATC would be supported by user fees, paid mostly by airlines, and would have the vast advantage that commercial air travel wouldn't be so heavily reliant on Congress.

Last year, ATC reform was left out of the Federal Aviation Administration authorization bill that Congress approved in July. On Wednesday, the House Committee on Transportation and Infrastructure conducted a hearing titled, "The Need to Reform FAA and Air Traffic Control to Build a 21st Century Aviation System for America," where backers once again outlined the benefits.

"Today's hearing clearly showed the need for transformational air traffic control reform," said committee Chairman Bill Shuster, (R-Pa.), the airline industry's primary ally in the reform effort, in a prepared statement released following the hearing.

"I don't know how anyone watching this hearing can come to any other conclusion," Shuster said.

But obstacles remain.

One Washington aviation lobbyist who asked not to be named said the Senate is unlikely to go along with whatever the committee produces. Another said, "Shuster's not ready to throw in the towel," but he would be in a far stronger position if he could get help from Delta, one of the big three airlines and arguably the one with the most muscle in Washington.

"Delta is a thorn in their side," the second lobbyist said, referring to the airlines aligned with A4A in seeking privatization.

Another source said Delta didn't back reform last year, no bill has emerged this year and the carrier hasn't changed its position.

Delta spokeswoman Elizabeth Wolf said, "Delta remains committed to working with the FAA and other aviation industry stakeholders to make U.S. airspace more efficient, with the goals of reducing delays, improving traffic flows and enhancing airline performance."

But Wolf declined to say whether Delta would back ATC reform this year.

In a September 2016 interview with TheStreet, Delta spokesman Trebor Banstetter said that A4A "has shown no evidence that privatizing air traffic control would do anything to actually improve U.S. airspace.

"Delta does not oppose reform," Banstetter said then. "But we do oppose privatization and upheaval, which is really what {American Airlines CEO Doug} Parker and A4A are advocating. "

"The nation's air traffic system needs to be modernized through next generation technologies and procedures," Banstetter said. "That process is underway and already showing benefits.

"The A4A proposal to take the nation's air traffic control system away from the FAA and put it in private hands puts that modernization at risk," he said.

Some speculate that Delta would back FAA privatization in return for backing from A4A and Shuster in the effort to restrict the rapid U.S. growth by subsidized Middle East airlines. That speculation is not true, Wolf said.

In a recent analysis emailed to members of the Business Travel Coalition, an advocacy group, Chairman Kevin Mitchell suggested Delta would make such a deal.

Last year, "Delta lobbied vigorously against ATC reform," Mitchell wrote. "It was the lone voice in the U.S. airline community touting FAA's NextGen accomplishments. It declared that FAA turned the corner on timely and cost-effective modernization, and publicly chided its competitors for blaming FAA for what Delta suggested were their own operational failings."

On May 2, Shuster's committee conducted a hearing on airline customer service, a response to the April incident where a recalcitrant United passenger was dragged off an aircraft by Chicago Aviation Authority security officers.

Even at that hearing, several Democratic members spoke against ATC reform. They included Rep. Dina Titus (D -Nev.), who said, "Pretty soon this committee is set to consider a proposal to privatize ATC to a corporation that will be controlled by you all, by the airlines.

"It will leave customers in the lurch," Titus said. "What do you have to show that means you will be able to take over this corporation?''

United (UAL)   President Scott Kirby responded that "FAA is handicapped today by the model, {by} annual budgets.

"The kinds of investments we would make for the future are hard for the FAA to do," he said. "You have more sophisticated GDS technology in your car than we have.

The FAA "does a wonderful job," Kirby said. "But the process is designed to be difficult."

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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