Future Infrastructure budget cuts are inevitable – We must locate other means of investment to rebuild and innovate

Ext 2—NIB Solves NextGen

The bank would help fund NextGen

Testimony of Scott Thomasson Progressive Policy Institute October 12, 2011, United States House Of Representatives Committee On Transportation And Infrastructure: Hearing before the Subcommittee on Highways and Transit “National Infrastructure Bank: More Bureaucracy and Red Tape” October 12, 2011, http://republicans.transportation.house.gov/Media/file/TestimonyHighways/2011-10-12%20Thomasson.pdf

The driving motivation behind the national infrastructure bank is twofold. First, the financing offered by the bank would provide an additional tool for reducing the costs of new projects and attracting private capital to share in the risks and expenses of these investments. The bank would be an optional tool available to states and local governments and for federally-sponsored projects like NextGen Air Traffic Control. Second, the bank’s evaluation and financing of projects would be a transparent and predictable process, staffed by professional finance experts and guided by clearly defined, merit-based criteria. This would ensure that at least some portion of our public investment decisions would focus on projects that will generate economic benefits and enhance competitiveness at a national or regional level.

The bank would lay out plans to purchase future NextGen ATC

What, you may ask, is an infrastructure bank? Well, it’s what it says it is: a public bank that invests in infrastructure, such as bridges, roads, rail lines, ports, and even energy projects and things like broadband capacity. Here’s how theWhite House presented the idea:¶ The Administration’s six year plan would invest $30 billion to found a National Infrastructure Bank (I-Bank). The I-Bank would leverage this Federal investment by providing loans and grants to support individual projects and broader activities of significance to our Nation’s economic competitiveness. For example, the Bank could support improvements in road and rail access to a West Coast port that benefit farmers in the Midwest, or a national effort to guarantee private loans made to help airlines purchase equipment in support of the next generation air traffic control system (NextGen). A cornerstone of the I-Bank’s approach will be a rigorous project comparison method that transparently measures which projects offer the biggest “bang for the buck” to taxpayers and our economy. This marks a substantial departure from the practice of funding projects based on more narrow considerations. ¶ If $30 billion sounds relatively modest, that’s because it is. It’s seed money, which the I-Bank could them use to attract private capital. And there's private capital out there. For example, Goldman Sachs runs a $10 billion infrastructure fund.

A national infrastructure bank would fund aviation

Department of Transportation, 2012 “Budget Estimates: Fiscal Year 2012: National Infrastructure Bank” Department of Transportation—submitted for the use of the committees on appropriates as a FY 2012 Congressional Budget Justification. http://www.dot.gov/cfo/documents/IBankFY2012_CJ.pdf

The National Infrastructure Bank (I-Bank) will leverage federal dollars and focus on investments of national and regional significance that often fall through the cracks in the traditional transportation programs. The I-Bank will base its investment decisions on clear analytical measures of value-for-cost and level of non-Federal co-investment, competing projects against each other to determine which will produce the greatest returns to Federal investment. Unlike traditional Federal funding programs that rely solely on regular solicitations for proposals, the I-Bank will also incorporate an entrepreneurial approach to investing that seeks out the most promising projects, nationwide. Transportation and transportation-related projects proposed by states, local governments, other public agencies, and private entities with a public co-sponsor would be eligible for assistance, which could be made through grants, loans or a blend of both. A transportation related project means a project that is part of or related to a transportation improvement that involves a highway, rail, bridge, aviation, port and marine, or public¶ transportation facilities and systems; intercity passenger bus or passenger or freight rail facilities and vehicles.

Ext 3—NextGen k2 Economy

NextGen reduces weather flight delays—that maximizes economic efficiency

Joint Planning and Development Office 2007 (Joint Planning and Development Office USFG “Business Case for the Next Generation Air Transportation System” 8/24/07

Complex, dynamic systems such as our NAS will always experience some unavoidable disruptions. Weather is one significant source of disruption to system capacity, sometimes causing protracted delays and inefficient routes of flight. NextGen capabilities will help mitigate portions of these weather-related delays, maximizing the economic value per flight even on the most challenging days. NextGen performance benefits in bad weather were analyzed based on three actual days of NAS operations: Results suggest that NextGen decreases the average flight delay by a factor of 7 for the excellent weather condition, a factor of 14 in a moderate weather, and by a factor of about 4.5 in a severe weather day. The Air Transport Association estimates that each minute of delay costs approximately $50 per minute per flight (excluding passenger value of time). The demand set used for this analysis contains approximately 87,000 flights; therefore, the estimated delay savings enabled by NextGen is approximately $282 million a day in moderate weather and $239 million a day in severe weather.

NextGen increases overall air mobility—that increases economic success

National Science Technology Council 2010 (National Science and Technology Council 10 Chaired by President Obama and VP Biden (Executive Branch to Coordinate Science and Technology Policy “National Aeronautics Research and Development Plan)

Mobility through the air is a key function of the nation’s air transportation system . The U.S. economic system revolves around the capability to move goods and people efficiently throughout the nation and the world. Aviation contributes an estimated $741 billion to the U .S . economy or roughly 5 .6 percent of the nation’s gross domestic product . Over 11 mil- lion jobs with $369 billion in wages are estimated to be associated with the aviation indus- try . The aerospace products and parts sector is the largest U .S . manufacturing exporter and contributes a net surplus of approximately $61 billion to the U.S. trade balance.7 Enabling mobility through the air with sufficient flexibility and affordability to accommodate the full range of aircraft requirements and attributes, as well as projected passenger and cargo traffic, is essential to America’s economic success. As a result of the recent worldwide economic turmoil and the volatility of fuel prices, projections for air traffic in the 2025 time period have varied considerably. The FAA’s fore- cast of the growth of passenger enplanements and operations between 2008 and 2025 was reduced between 35–40% in its Terminal Area Forecast (TAF) Summary 2008–2025 as com- pared to the TAF for the 2007–2025 time period. However it is interesting to note that the active general aviation fleet is forecast to grow almost 20% during the next 17 years with the more expensive, and sophisticated turbine-powered fleet (including rotorcraft) and turbine jet fleet expected to grow at forecast rates of 3.2% and 4.8%, respectively, between 2008 to 2025 (FAA Forecast 2009) . Additionally, increased operations involving very light jets, UAS, rotorcraft, and suborbital space vehicles are possible . These projections have led to increased uncertainty in demands on the NAS by 2025 . Additionally, by 2025, the possi- bility exists that new aircraft with significant changes in their performance capabilities will join the fleet (e.g., hybrid-wing body aircraft, supersonic business jets and small transports, and advanced rotorcraft) . The message remains clear that by 2025, the NAS needs to be scalable and flexible to accommodate a significant increase in the number of operations,8 as well as significant changes in the capabilities of the fleet. The environment where the NAS must accommodate a projected increase in the number of operations over a 2004 baseline9 is referred to as the “A× environment” where A refers to the growth factor over 2004 (e.g., 1 .8× refers to an environment to accommodate 1 .8 times the number of operations that occurred in 2004) . Finally, the future NAS must help enable the capabilities necessary to provide for aviation security, national security and homeland defense, and the required reduction in environmental impacts from aviation .There are clear signs that the nation’s air traffic management system is under serious stress as a result of current demand levels . The system is extremely sensitive to local perturba- tions and reacts with system-wide ripple effects. Delays result in a huge cost to industry, passengers, shippers, and government. The forecast growth in air transportation over the next two decades has also triggered community concerns over aircraft noise, air quality, and congestion . Many market-based, economic solutions could be pursued to reduce con- gestion, such as implementing congestion pricing or developing an alternative to first- come-first-served service. These have not been fully explored yet. Despite these potential nearer term solutions, current demand predictions still point to the need for a fundamental transformation of the NAS for long-term growth, which is the focus of the R&D recom- mendations in this section . A mandate for the design and deployment of a transformed air transportation system was established in Vision 100 – Century of Aviation Reauthorization Act (Public Law 108-176).10 The law established a Joint Planning and Development Office (JPDO) representing six government departments and agencies and the private sector to develop the Next Gen- eration Air Transportation System (NextGen – formerly referred to as NGATS) . NextGen will entail a revolutionary transformation of the U.S. airspace system to a performance- based, scalable, network-enabled system that will be flexible to adapt to meet future needs. Achieving NextGen will require focused and coordinated R&D to address key decisions and challenges associated with system transformation.

NextGen is the lynchpin for airline jobs and industry growth.

James C. May, March 18, 2009. “Air Traffic Control Modernization and Near-Term Achievable Goals” White House Backfiles. James C. May is the President and CEO of Air Transportation Association of America, Inc., this is from his statement before the Subcommittee on Aviation of the House Committee on Transportation and Infrastructure. http://www.whitehouse.gov/files/documents/cyber/Congress%20-%20NextGen%20ATS%20HouseAvSubc_090318_ATAWritten_FINAL.pdf¶ The ATC system is a critical national infrastructure that serves the American people and the commerce of the United States, and all system users rely on it, especially the scheduled airline industry. The airline industry is the foundation of the commercial aviation sector, which comprises airlines, airports, manufacturers and associated vendors. U.S. commercial aviation ultimately drives $1.1 trillion per year in U.S. economic activity and 10.2 million U.S. jobs. By any measure, the U.S. airline industry is a valuable national asset and its continued economic health should be a matter of national concern. Without a modern, efficient ATC system, the airline industry will slowly strangle, U.S. commerce and productivity will be impaired and U.S. businesses will not be able to compete effectively in the global economy. For these reasons, modernizing the ATC system now is critically important to the growth and competitiveness of our economy.

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