Aviation Finance: Observations on the Effects of Budget Uncertainty on FAA

Since 2007, the Federal Aviation Administration (FAA) has operated and overseen the nation's aviation system amid ongoing budget uncertainty, an issue that has affected other federal agencies as well. This uncertainty is due to a protracted reauthorization process and timing issues associated with the budget and appropriations process. For instance, FAA experienced23 authorizing extensions following the expiration of FAA's authorization in 2007 until the enactment of the FAA Modernization and Reform Act of 2012, as well as a sequestration and the partial shutdown of the federal government in 2013.1 GAO has previously reported that aviation stakeholders are concerned that budget uncertainty makes it difficult for FAA simultaneously to operate the aviation system and implement air traffic control modernization through FAA's Next Generation Air Transportation System (NextGen).2 Some aviation stakeholders also cite budget uncertainty as a justification for the restructuring of FAA's Air Traffic Organization (ATO).