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TUESDAY, JUNE 25, 1996

U.S. House of Representatives,

Subcommittee on Aviation,

Committee on Transportation and Infrastructure,

Washington, DC.

    The subcommittee met, pursuant to notice, at 11 a.m. in room 2167 Rayburn House Office Building, Hon. John J. Duncan, Jr. (chairman of the subcommittee) presiding.

    Mr. DUNCAN. The subcommittee will please come to order.

    I want to first welcome all the witnesses here today, and I would particularly like to welcome Senator Cohen.

    Mr. Shuster, the chairman of the full committee, has launched an investigation into the many issues that have been raised since the unfortunate ValuJet accident last month.

    This subcommittee—and I think I can speak for every member—truly regrets the loss of life in that terrible accident, and our heartfelt prayers go out to those families and friends who lost loved ones.
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    Just last week we heard some very compelling testimony from a number of family members of victims who have been killed in airline crashes and how they were treated by airlines, the media, lawyers, and Government agencies.

    This subcommittee plans to introduce legislation that hopefully will help ensure that family members of those tragedies are treated with dignity and respect, and that they receive the information that is so desperately needed when those tragedies occur.

    The purpose of this hearing today is to examine a broad spectrum of airline safety issues, not just ValuJet, but those issues that have been raised since this accident occurred.

    This subcommittee has a number of questions, some of which include the adequacy of the FAA's safety and hazardous materials inspection programs, and specifically the FAA's oversight of ValuJet in this regard.

    We also want to look into other issues, including the FAA's role in overseeing maintenance at contract repair stations, the FAA's implementation of NTSB recommendations, and the latest NTSB conclusions regarding the cause of the crash.

    We want to make absolutely sure that we don't just make cosmetic changes, but real changes and effective changes that solve the problems that exist.

    Let me also say that under the leadership of Chairman Shuster this committee has approved legislation that I and nearly every member of the subcommittee, including Mr. Lipinski and Mr. Oberstar, introduced to reform and streamline the FAA. In fact, I'm pleased that just yesterday the ''New York Times'' once again endorsed the bill that the House passed. In fact, the House unanimously passed H.R. 2276 on March 12.
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    In addition, the full committee and the House overwhelmingly, by a margin of about two to one, approved Chairman Shuster's legislation, H.R. 842, which would provide available and needed resources from the Aviation Trust Fund that can and should be used to update and improve our Nation's air traffic control system, as well as other FAA safety-related functions.

    So I think that this committee and the entire House has acted in a timely and very responsive fashion to help make our already safe aviation system even safer.

    We have emphasized that in this subcommittee—that our system is very safe. As several of us have pointed out, there have been a little over 12,000 people who have lost their lives very unfortunately and very tragically in aviation accidents since the Wright Brothers' flight in this country, but almost that many lose their lives in every 4 months on our Nation's highways.

    I know that millions of Americans rely on and want—and they have shown that they want low-cost airlines by their ticket purchases and their comments, but obviously they want low-cost airlines that are safe.

    We need somehow to strike a balance to make sure that we don't over-regulate the aviation industry in this country so that we end up with just one or two large airlines and no others, because then we will force the price of air travel up so much that we would force millions of Americans back onto our already overcrowded and much less-safe highways.

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    We've got to strike this balance. These low-cost carriers are, for many people, the only opportunity that they could have to fly. We must find a balance to ensure that the low-cost carriers remain in the marketplace and that they and all airlines are as safe as possible.

    We look forward to hearing from our distinguished witnesses.

    Before I recognize the chairman of the full committee, I would like to announce that we will be swearing in our witnesses today, with the exception of Senator Cohen. This follows the custom in this committee to swear in witnesses at investigative hearings.

    Previously, in the Investigations and Oversight Subcommittee, witnesses were routinely sworn in, so this is nothing out of the ordinary, and we just wanted to let the witnesses know about this.

    Also, because we want to get to the witnesses as soon as possible, the leadership of the committee has reached an agreement that the only members who will be giving oral opening statements today will be the chairman, the chairman of the full committee and the ranking members. I hope that other Members are understanding of the need to do that. We will place any statements that they have in the record.

    Also, in order to expedite things, it is our plan—and we have had requests in this respect also—that after Senator Cohen testifies we will have Mr. Hall, Ms. Schiavo, and Mr. Hinson each come up to the table individually and testify, and then we will have Mr. Hall—after Mr. Hall and Ms. Schiavo testify, they will return to their seats, and we will defer questions to them until after Mr. Hinson testifies.
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    After Mr. Hinson testifies, I will recognize Chairman Shuster and one Democratic Member to ask questions of Mr. Hinson and Mr. Broderick only. Then we will bring Mr. Hall and Ms. Schiavo back to the table and all Members will have an opportunity to ask any questions of them. As I said, that has been worked out at the request of some of the witnesses involved and with the agreement of the chairman of the full committee and the ranking member, Mr. Oberstar.

    So at this time I now would like to call on the chairman of the full committee, who has really been the leader of this entire investigation, and that is our fine chairman, Mr. Shuster.

    Mr. SHUSTER. Thank you very much, Mr. Chairman.

    It's very important that these hearings not obscure the very clear fact that air travel is remarkably safe. The chairman has quoted some of the statistics. Let me share one additional one with you.

    The United States has 50 percent of the world's air traffic, but only 8 percent of the fatalities. Indeed, air travel in America is nearly three times as safe as it is in Europe.

    So, having emphasized that, nevertheless, one accident is one too many. The recent ValuJet crash has raised very significant questions about the role of the FAA in overseeing airlines.
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    After the crash, Secretary Peña and Administrator Hinson insisted that ValuJet was safe. Indeed, on Tuesday, June 11, Administrator Hinson, whom I certainly respect, was in my office saying once again that ValuJet was safe.

    Then, a week later, after a political meeting in the White House, ValuJet was grounded. We want to know why. A rational person could conclude that political considerations played a role, and there is no room for politics when we're talking about aviation safety.

    If ValuJet wasn't safe, why wasn't it grounded 6 months ago?

    If we go through the list of items in the consent order grounding ValuJet, you will see that many of them occurred months and months ago. Even the more recent ones seem no worse than the problems cited months ago, and the problems seem similar to those that have been found at virtually every other airline in the past. Why was the penalty not a fine rather than a grounding?

    The FAA has only recently discovered the extent of the problems at ValuJet. That being the case, then the question arises: where has the FAA been all this time? Why didn't the FAA's regular inspection program uncover these problems? Why didn't the special 120-day inspection program uncover these problems? Why did it take a crash, 110 deaths, and an intense 30-day inspection and intense media and Congressional scrutiny to uncover these problems?

    This certainly raises serious questions. Among those questions, we've been told that inspectors haven't been trained as they should have been for the assigned tasks. We've been told that there is an inappropriate allocation of inspectors so that the least-experienced inspectors are assigned to the least-experienced airlines. And we've been told by more than one that a culture of fear exists where inspectors are afraid to tell management of the problems that they find.
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    All of these allegations—and I emphasize the word ''allegations''—certainly deserve our closest scrutiny.

    I want to emphasize that the chairman and I, in consultation with the ranking members, are not placing a limit on these hearings. We are going to continue to pursue this until we get answers to these questions.

    Now, there are two actions that could be taken immediately. The FAA could be made an independent agency to remove allegations of political interference. This committee and the House passed such legislation to reform the FAA last March, passed it overwhelmingly on a bipartisan basis, and the Administration opposes that legislation.

    The second thing that could be done is to take the Trust Funds off budget to free up money for more inspectors, better equipment, and other safety improvements. Again, the House passed legislation in April, but the Administration opposes such legislation.

    Secretary Peña suggested in a press conference changing the FAA's preamble to eliminate the so-called ''promotion'' aspect of its charter, but the Secretary has yet to send us any legislation to do this. It seems that we're getting management by press release rather than legislation with these recommendations. In fact, I believe that's a red herring.

    The law which has been in effect for the past 40 years very clearly says that safety is the prime mission of the FAA. Nevertheless, all of these recommendations should, indeed, be on the table and should be considered, and we're still waiting to receive such recommendation through legislative recommendation rather than press release.
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    Having said all that, I look forward to these hearings. I emphasize again that we're going to get to the bottom of these issues.

    I thank you very much, Mr. Chairman, for recognizing me.

    Mr. DUNCAN. Well, thank you, Mr. Chairman Shuster.

    We will go at this time to our very fine ranking member, Mr. Lipinski, for any opening statement that he has.

    Mr. LIPINSKI. Thank you, Mr. Chairman.

    Mr. Chairman, we are holding this hearing today as a result of the ValuJet plane that crashed into the Everglades on May 11 and killed 110 people.

    As we examine the range of issues raised by this crash, I think it would be wrong not to stop and pay tribute to their memory.

    We were all moved by the testimony at last week's hearing by Richard Kessler, whose wife, Kathleen, was a passenger on Flight 592. As we proceed with today's hearing, I know we do so in the name of the 110 victims of ValuJet Flight 592.

    A tragedy has occurred, and we are here to learn whatever lessons we can to prevent another disaster.
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    Mr. Chairman, you will recall that only days after the ValuJet crash I came to you and suggested that we hold this hearing. I was convinced then, and I am even more convinced today, that there are important issues to be addressed by this subcommittee.

    It is our responsibility to hold this hearing. We simply won't be doing our jobs if we didn't.

    There were two primary reasons I requested this hearing. First, I was very concerned with the conflicting statements about ValuJet safety made by the Secretary of Transportation and the FAA administrator on the one hand and the DOT Inspector General on the other.

    At the time I found it very disconcerting that the three top officials of the United States Department of Transportation could make statements about the safety of an airliner or groups of airliners that were so diametrically opposed. With the grounding of ValuJet last week, I remain even more concerned about these statements.

    The American people rely on the statements of their senior Government officials. They should not be the victims of some inter-agency turf battle. No public official should make statements which he or she cannot substantiate, and no public official should make headline-grabbing pronouncements questioning the safety of our transportation system without making every effort to address the problems through appropriate channels.

    The American people should not be subjected to that type of manipulation. At the same time, though, the American people deserve to fly on airlines that are undeniably safe.
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    The second issue that I hope to raise in this hearing relates to the role of the low-cost, new entrant carriers in the U.S. aviation system.

    In the weeks since the crash of Flight 592, significant attention has been given to the fact that ValuJet has grown at an unprecedented pace since it began operation in October 1993. In recent years, the number of low-cost new entrants has skyrocketed. I see it at Chicago's Midway Airport, located in the heart of my District, which is dominated by low-cost carriers, many of which are new entrants.

    While I am certainly very happy with the positive economic impact of these carriers at midway and throughout the Nation, I am concerned by their rapid growth and low-cost emphasis.

    I do believe that these low-cost carriers, led by Southwest, have made air travel available to a segment of Americans who would not otherwise fly, and I consider this to be a great happening. But I want to make doubly sure that these affordable carriers are safe.

    The FAA's action this week curtailing service by Kiwi Airlines sends up another red flag for me, emphasizing the fact that this subject needs extensive investigation.

    Today's hearing is the first step in that process, and I expect that we will have other hearings to further address the implications of the growing low-cost new entrance airline community.

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    Mr. Chairman, since I first suggested a hearing on these two issues in the middle of May, there have been a number of events which have slightly shifted the focus of this hearing.

    ValuJet was grounded last week. The FAA has announced changes in its inspection program as in the wake of this accident. And, as we all know, although the NTSB has not yet established a cause for the accident, the oxygen containers returned from a maintenance contractor to ValuJet seemed to be at the root of the disaster.

    In the course of today's hearing we will delve into many of these issues. We have a full day. I know other Members wish to speak as soon as possible. But let me take a moment to emphasize the real importance of this hearing.

    Chairman Duncan and I do not sit here to get ourselves on television or in the newspapers. Certainly I expect there to be considerable media attention in this issue, but let's not allow the cameras to drive what we are doing here. A tragedy has occurred, and we are here to learn whatever lessons we can to prevent another disaster.

    Thank you, Mr. Chairman, very much for your time.

    Mr. DUNCAN. Well, thank you very much, Mr. Lipinski, for a fine statement. The Chair certainly appreciates your interest and involvement in this right from the very day that this tragedy first occurred.

    The committee, and this subcommittee, in particular, is very fortunate to have as one of its most dedicated members the ranking member of the full committee and former chairman of this subcommittee, Mr. Oberstar.
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    Mr. OBERSTAR. Thank you very much, Mr. Chairman. And especially thank you for your kind words, as well. I appreciate your comments, those of Mr. Shuster, and my good friend, Mr. Lipinski, our ranking member.

    As we go throughout this hearing, we must all be very conscious of the impact of words and questions and implications, suggestions, because those will have very serious and profound impact upon the families of the victims of ValuJet, the employees of ValuJet, the traveling public, who will be very tuned to the words that we use, questions we raise, and the comments that we make in the course of this hearing and the subsequent ones. And I appreciate the chairman's willingness to extend this process out over a longer period of time than just one hearing.

    We by now know the story. On May 11 an aircraft operated by ValuJet carrying 110 people disappeared into the Florida Everglades. Pilots in the area witnessed the area from a distance, and said it took them 15 minutes to locate the accident site because the aircraft and all of its contents had completely vanished.

    There was virtually no sign that a large jet had just plunged into the earth, unlike other crash sites that we have witnessed in recent years.

    The plane and its contents had been shattered into small pieces, immersed in mud and limestone beneath a murky swamp, filled with predatory animals and rough sawgrass, and with it, stories of 110 people. One of them was a celebrated athlete from Notre Dame, Rodney Culver, for whom ceremonies were just held recently at Notre Dame.
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    America watched mesmerized as Dade County officials, as the National Transportation Safety Board investigators meticulously searched through miles of swamp inch by inch to recover the least scrap of evidence that could be brought to bear on this issue to help us discern a probable cause. Covered in protective suits, investigators meticulously searched into the toxic waters as much as 20 minutes at a time, recovering about 75 percent of the aircraft, including the flight data recorder and the cockpit voice recorders.

    There has been no official NTSB determination of probable cause yet, and we must keep that in mind throughout this process today.

    But speculation certainly began immediately about the inherent safety of so-called ''low-fare'' or ''low-cost'' carriers. A country that had enthusiastically enjoyed the benefits of low fares and the competition they engendered now was wondering whether low fares could be offered, whether they might, in fact, be a partnership in the tragedy at hand.

    Where did low-fare carriers cut costs? In spite of repeated assurance from the Secretary of Transportation and the administrator of FAA that low-cost carriers or low-fare carriers were safe and that the system of FAA safety would protect the public, uncertainty persisted.

    Could cutting meals, cutting other amenities, alone, account for $39 and $49 fares—unheard of among the major carriers? Could it be possible that those low-fare carriers were cutting costs elsewhere with safety matters? Could their fleets, some of which were comprised of aircraft parked in the desert for many years and which were as much as 20 years old and older, could they be received inadequate maintenance in order to save the carrier money?
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    Were these airlines safe? That is the fundamental question people were asking in the aftermath of the tragedy.

    Adding to the public uncertainty were other factors. The Inspector General of the Department of Transportation, Mary Schiavo, took to the airwaves in the aftermath of the accident to proclaim a longstanding concern about the safety of ValuJet specifically, as well as other low-cost carriers, and then dragged regional carriers, commuter airlines, into the mix, as well.

    She had articulated those concerns in an article written for publication in a national periodical scheduled to be published shortly before the crash, written before that crash. Those pronouncements created a media frenzy that questioned the integrity of FAA's oversight of air crash maintenance.

    On June 17 the FAA announced that ValuJet had agreed to ground its fleet, pursuant to a consent order. Intense FAA oversight indicated that ValuJet did not adequately monitor the maintenance of its aircraft, and the decision to ground the carrier and the subsequent decision to take action against another new entrant low-cost carrier fueled speculation that low-cost carriers may, indeed, be inherently unsafe.

    Certainly all of this has raised questions that have prompted this hearing, prompted a widespread inquiry into the matter of low-fare or low-cost new entrant carriers. That concern is not new in this subcommittee.

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    At the conclusion of the 103d Congress, I directed the GAO to undertake two inquiries into low-fare new entrant carriers, one to examine DOT's fitness certification process for reviewing and permitting new entrant carriers to enter the marketplace, and to review FAA's safety certification process for new entrant carriers.

    The first report was completed in January of this year. The second report is due by GAO in July.

    Many of those issues have already been addressed with both the Department and FAA, and many of the recommendations made by GAO to improve the safety certification have already been implemented by the FAA.

    But that still raises questions about whether FAA should have taken this action to ground the carrier at an earlier date or whether maybe they should have taken it at all.

    Of the 34 incidents cited in the consent order grounding ValuJet, at least 13 took place before the May 11 tragedy.

    We need to know, in the course of this hearing, whether FAA was aware of these incidents before May 11. If not, why not? Why did the inspection process fail to uncover these violations and send up a red flag serious enough for the FAA to take action before May 11?

    We also need to know what happened in the internal process at FAA when a February 14 memo was prepared in the Washington office of the flight standards staff which recommended, ''Consideration should be given to an immediate FAR 121 recertification of this airline.'' I'd just say, Mr. Chairman, if I had seen that memo and if I had had that recommendation come across my desk, I would have hit the roof. I've been in this business long enough to know that that's a red flag. That's a signal to take action. Yet, it sat on a desk and didn't go to Mr. Broderick and didn't get to Mr. Hinson.
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    There was an explanation for it. We've asked a number of questions about it. But that kind of thing is serious, and the people in the decisionmaking process and the chain of command that have to make those decisions need to have that kind of information in their hands. There is a shortcoming that needs to be addressed in a structural way within the agency.

    I want to acknowledge that the ValuJet accident and its aftermath have resulted in more than the grounding of ValuJet and public concern about the safety of these new entrant carriers.

    The concerns about the accident and the lessons learned have come at the expense of a single professional within the FAA who has labored the longest to improve aviation safety throughout the toughest era in aviation, in that period immediately following deregulation.

    A report of this subcommittee said safety has taken a back seat to economics, and it was Tony Broderick who was at the forefront of safety within the FAA, doing an objective, tough, and fair job. Without him pushing against a grain that would have had no changes. Instead, we have had reforms in duty time regulations, in de-icing standards, in fabric flammability, in material flammability within the interior cabin of an aircraft and crash survivability standards.

    It's fair to say that the 110 people who walked away from the Sioux City DC–10 crash survived because of 18 G-force seat supports that were in place because of what Mr. Broderick insisted upon and what this subcommittee also insisted upon.

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    I hope that in the aftermath and in the reorganization of FAA that the leadership will be wise enough to find people of the caliber of Tony Broderick with the institutional desire to put safety at the highest possible level conducting this important work of the agency.

    We have a lot of ground to cover today. The hearing has been structured in an appropriate fashion, and I look forward to the witnesses and to the responses that they will be making.

    Mr. DUNCAN. Thank you very much, Mr. Oberstar.

    I can assure you and all of the witnesses that the hearing today will be conducted as fairly as humanly possible, and we are pleased to start now with—as I previously announced, the leadership of the committee, the full committee Chairman, Mr. Shuster, and Mr. Oberstar, and the committee staff have agreed that any other opening statements will be placed in the record.

    We will begin now with the witnesses.

    We are honored to have as our first witness Senator William Cohen, who has been one of the real leaders in the other Body on issues involving the FAA, and recently conducted some extensive hearings into the operation of the FAA.

    Senator Cohen, it's a privilege for us to have you with us. You may begin your testimony.
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    Senator COHEN. Thank you very much, Mr. Chairman.

    I want to thank the committee for allowing me to offer a few comments this morning.

    I want to agree initially with Chairman Shuster when he pointed out that air travel is the safest form of travel that we have in this country and, indeed, globally.

    I also agree with Congressman Oberstar when he says that we should be cautious in the use of our words, and indeed we should, but we should also be candid in our assessments and not in any way paper over some of the safety deficiencies that exist and are in need of correction.

    I want to comment first of all on the specific concerns surrounding the May 11 crash of ValuJet Flight 592. I want to point out initially it's not my intent to in any way denigrate the Clinton Administration or any of its officials. The deficiencies that have existed in some of the safety programs have long preceded the arrival of the Clinton Administration, so my comments should not be construed in any way as being critical of the Administration or in any way as politically motivated.

    I think it's important to focus on the adequacy of the certification process and whether or not ValuJet should have been flying on May 11. Congressman Oberstar raised this issue in his recent comments.
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    As all of you I think are aware, a number of documents have been released since that crash that clearly raise serious questions about the degree of ValuJet's compliance with aviation safety regulations prior to the crash. As has been pointed out, in the aftermath of the crash the Department of Transportation and FAA officials repeatedly made statements such as, ''We found no substantial safety shortcomings or regulatory violations.'' ''The airline is safe; otherwise, we wouldn't allow it to fly.'' ''We have not found a basis to shutdown '' ValuJet.''

    Even ValuJet's recently hired safety czar stated, ''We found nothing so far to cause us to believe the airline is unsafe.'' I frankly find these comments to be rather inconsistent with the information that has been made available for some time to both the Department of Transportation, the FAA, and ValuJet's management.

    More troubling to me were the statements made just last week by the Secretary of Transportation and the FAA administrator when they were questioned as to why ValuJet was not shut down earlier and how they could have given such unqualified endorsements of the airline.

    Both senior officials stated that their earlier declarations were based on information available to them at the time those statements were made. However, when those statements were made, DOT and the FAA had several documents in their possession that clearly questioned ValuJet's safety record and showed that the airline was not in full compliance with the Federal Aviation Regulations.

    Specifically, DOT and FAA had an October 1994, FAA inspection report; an August 1995, Department of Defense inspection report; a September 1995, FAA inspection report; two February 1996, memoranda from the FAA to ValuJet senior management; a February 1996, FAA report; a May 2, 1996, safety analysis of low-cost air carriers; and a May 6, 1996, draft report on FAA's special emphasis inspection.
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    I have copies of all of these documents. I believe the committee has them in its possession.

    A review of these documents, as well as FAA's inspection results since October 1993, clearly shows that ValuJet began having problems almost immediately after it began flying, and some of those problems persisted throughout its period of operation. But, to me, one of the most serious violations was discovered in September 1994 when an FAA inspector found that a ValuJet aircraft made 148 flights while unworthy.

    And then a February 1996, memo from the FAA to the president at ValuJet stated that the FAA had concern that ValuJet was not meeting its duty to provide service with the highest possible degree of safety in the public interest, as required by law.

    This memo further stated that ValuJet did not have a structure in place to handle its rapid growth, and that it may have an organizational culture that is in conflict with operating at the highest possible degree of safety.

    And then, moreover, a February 1996, report prepared by three FAA inspectors recommended that the FAA consider having ValuJet go through an immediate recertification.

    Notwithstanding these documents, the president at ValuJet issued a press release 1 month prior to the crash which stated, in part, ''ValuJet is known by the FAA to have an excellent record of self-audit, self-disclosure, and voluntary efforts to achieve the highest levels of safety.'' And the president further stated that ValuJet's safety record is ''certifiably among the very best in the airline industry.'' Certifiably.
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    Mr. Chairman, we know the documents I've just referred to were available to DOT, FAA and ValuJet's management.

    The Transportation Secretary and the FAA administrator either unintentionally misled the American people with assurances that were false or were mislead by false assurances of their own subordinates, but, in either case, truth became the first victim in the campaign to assure travelers they had no cause for concern.

    Mr. Chairman, the deficiencies in the FAA's inspection program have been documented numerous times over the years. FAA administrators in the past pledged to correct the problems.

    To give you an illustration, in a June 18 press conference, when discussing ValuJet's use of contract maintenance, the Transportation Secretary stated, ''This method of maintenance operation was new and different, and the FAA had to make adjustments in how it oversees these types of operations.'' The FAA administrator also said the use of contract maintenance was a new trend.

    Mr. Chairman, we had a hearing in 1986 in the Permanent Subcommittee on Investigations. At that hearing Mr. Anthony Broderick, who has been praised by Congressman Oberstar, testified, ''Perhaps the biggest single problem our inspector work force has faced is the management of new entrants. The proliferation of contract maintenance has been difficult to deal with, has also caused a large work load.

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    ''We had to educate inspectors in new ways of doing business and to alert airline management to the complexities and problems that such innovation could create.

    Chairman, contract maintenance is not a new trend, it's an old problem that has gone unaddressed and unsolved.

    Another issue related to the crash of Flight 592 is the FAA's apparent lack of standardization—what some call ''selective enforcement.'' The FAA administrator has said that the recent grounding of ValuJet was based on the results of the agency's 30-day intensive inspection program where there were some 2,000 inspections conducted, but just last month the FAA issued an emergency order suspending another air carrier's operating certificate because of discrepancies in its training, testing, and qualifications of flight attendants.

    Meanwhile, the FAA allowed ValuJet to continue flying, despite its knowledge of equally, if not more serious, deficiencies.

    Just 2 weeks before the crash, my subcommittee held a hearing to examine some systemic weaknesses in how the FAA regulates and inspects our Nation's aviation industry. We found at that hearing the FAA is not providing inspectors with sufficient training to adequately prepare them for their jobs, it's not successfully targeting its inspectors to the areas of greatest safety risk, and it's not holding managers and inspectors accountable for the quality of the inspections they perform.

    GAO testified at the hearing. They outlined a series of problems. We had one case in which an inspector received training to inspect an aircraft that he was responsible for 2 years after the airline went out of business.
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    We had another FAA inspector who had spent two decades inspecting general aviation aircraft, was then transferred and required to inspect large modern jets, and he didn't know how to open the door, and he was calling out for retraining for a long time and did not receive it.

    A critical challenge that faces the FAA is the effective use of its limited assets. We all can recognize the FAA is never going to be in a position, given its limited resources, to be able to fully inspect the thousands of entities within its jurisdiction, so it's essential that they target those inspection resources to the areas of greatest safety risk.

    GAO and the Inspector General have both found that the FAA's system for tracking this information is plagued with inaccuracies. We know that Secretary Peña has recently called for accelerating the deployment of the new SPAS system, new tracking system, but that is going to be counterproductive unless they correct the information that is going into it. To simply accelerate the deployment of a new system while the old system has many inaccuracies is not going to deal effectively with the problem.

    I think, Mr. Chairman, that the problem with FAA's data integrity is symptomatic of a greater deficiency with oversight of the inspectors. I think the majority—the overwhelming majority—of FAA inspectors are hard-working, they're dedicated, they're loyal, but the fact is that they are in desperate need of training and more instruction.

    I'll give you another example. With the help, back in 1995, of an inside informant, the FAA sent a special team to Florida. They identified a litany of deficiencies with a particular airline. This carrier was not, for the record, ValuJet.
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    The violations were so egregious the carrier was effectively playing an undetected game of Russian roulette with the aircraft and the unsuspecting public. Despite having conducted over 500 inspections the previous year at that airline, local FAA inspectors had failed to uncover the seriousness of the situation.

    In the absence of the inside informant who alerted the FAA, it's unlikely that those deficiencies ever would have been detected.

    I think, to pour a little more salt into this wound, not a single inspector who conducted those 500 inspections was ever reprimanded or received any kind of discipline for overlooking those serious deficiencies.

    I will comment very quickly, Mr. Chairman—I know time is running—on the need for minimum standards. GAO has indicated it's very hard to make any kind of an assessment on the part of the FAA if they don't have some minimum standards that the inspector is required to meet. When you go in for an automobile checkup for your inspection there is a list. We have brakes, we have horns, we have lights, we have other things. There is nothing in the FAA's inspection process which details what is being inspected.

    The attitude of the FAA is, ''Well, we have qualified inspectors and we trust their judgment.'' But it makes it virtually impossible to determine whether an inspector is making simply a cursory kick at the tires or whether they are, in fact, making a detailed examination of particular aircraft.

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    I also want to point out that, prior to our hearing, my staff interviewed over 200 individuals within the FAA, and the private sector, and since the hearing I had over 150 letters, faxes, and phone calls from throughout the industry, including more FAA inspectors. They're saying we have just scratched the surface, keep going, because there are serious problems.

    I want to give you one example of a problem that has really troubled me. As Congressman Oberstar mentioned, it's very difficult to get FAA inspectors to come forward. They are terrified about their jobs, that they might lose them if they come forward and report some of the deficiencies.

    We interviewed over 40 FAA inspectors. They all said virtually the same thing, but only one was willing to come forward and testify, provided his identity was protected, and we did that. We precluded the press from photographing that individual, we scrambled his voice electronically.

    Since that testimony, however, we have been told by several FAA employees that the FAA has undertaken an investigation to try and track down that individual by calling for the records of all of those who were not on duty that day, who may have been taking flights to Washington that day, and also trying to utilize a computerized system to de-scramble the voice.

    Let me suggest to this committee and to my colleagues in the Senate, this is not action worthy of any Federal agency. This is a gestapo-type activity. If there is any truth to this, those individuals ought to be prosecuted.

    It's for that reason that I referred the matter to the Justice Department and the FBI to conduct an investigation to see if the allegations are true.
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    Mr. Chairman, we also have conducted investigations into what are called ''unapproved parts.'' My prepared statement covers that in some detail. I only mention it in this context: one of the problems we have had in dealing with the FAA is it seems to have a culture that denies a problem exists, that defends the status quo, and then seeks to deflect public criticism.

    When we had a hearing last year about suspected unapproved parts, or bogus parts, making their way into the commercial aviation sector, the FAA testified in a public hearing that it wasn't a serious problem. But, in fact, there is an internal FAA document that I have that indicates it is a more serious problem than the FAA is willing to admit.

    I think that typifies some of the problems that we're trying to deal with here. On the one hand, we don't want to undermine the public's confidence in our agencies, but we shouldn't tolerate the failure to fully disclose information that allows lawmakers and regulators and executives to formulate policies to correct the problems.

    Let me suggest a couple of recommendations that I have.

    First of all, it has been suggested here—and I agree that we should eliminate the FAA's dual mission of promoting air commerce and assuring aviation safety. The dual mission poses an inevitable conflict of interest and, frankly, I don't know why the aviation industry doesn't engage in its own promotion, as opposed to the Government undertaking that function.

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    I hope that the FAA would embrace constructive criticism and address the managerial and oversight deficiencies, rather than attempting to deflect criticism.

    I would hope that the FAA would discontinue concealing unfavorable or critical internal analyses and make full disclosure so the public can make informed decisions about air travel.

    Chairman Duncan, you indicated that FAA should stop making cosmetic changes that simply mask the underlying deficiencies, and I completely agree, and I would hope that FAA would start holding managers and inspectors accountable for the quality of their inspections.

    I would also recommend, Mr. Chairman, that your subcommittee closely monitor the recertification process as far as ValuJet is concerned. I make this point because just last year there was an air carrier in Florida that was grounded for very serious violations. DOT's recertification documents, I believe, contained some questionable, inaccurate, and unsupported statements that may have allowed the air carrier to begin flying again than under normal conditions.

    So, in sum, I think the FAA culture has to change. It is a culture that says, ''Protect your turf, avoid accountability, and resist change.'' Without a change in culture, I think we're not going to see these problems seriously addressed.

    I know that a number of ValuJet employees, thousands of employees, are now imploring our offices. I've been watching this on television. I know they're concerned. They are concerned that Congress must take action which would jeopardize their jobs, and surely we should not take any kind of action which is imprudent or in any way complicates their livelihoods.
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    But I also think the Federal Government has a more compelling duty to ensure that thousands of innocent and trusting travelers do not experience the same horrible fate as those who perished in the Everglades.

    A final comment. When Senator Dole retired from the Senate a couple of weeks ago he made a statement which caught the attention of all of us, democrats and republicans. He said, ''Our word is our bond. It's the most important thing we have.'' The same applies to every single Government institution or agency, be it the White House, Congress, the FBI, the FAA. Our word has to be our bond.

    If we break it, through either neglect or indifference or arrogance or venality, then we breed distrust for the Government, itself, and we give rise to a contempt and a hatred that I think reflects the darker angels of our nature.

    The restoration and maintenance of confidence in Government institutions is one of the most important missions that all of us have, and it is not a mission impossible.

    Thank you, Mr. Chairman.

    Mr. DUNCAN. Well, thank you very much, Senator Cohen, for a really outstanding statement. You've done an excellent job of outlining the problems with which this hearing and our subsequent hearings will deal, and you've made some very fine suggestions.

    I can say, speaking for myself, that I think that when you leave the Senate at the end of this year, the Senate will be losing a very valuable Member. But it's obvious that you have a very great and sincere interest in this area, and we appreciate the work that you've done on it.
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    The policy of this subcommittee has always been that, because we have the opportunity to have private discussions with Members on a frequent basis, and also because we need to move on to the other witnesses and you've got other things that you need to do, that we do not ask questions of Congressional Members, and so we simply want to thank you at this time for being here and for giving such an outstanding start.

    Any questions that Members may have can be submitted in writing, and I'm sure that you and your staff will be glad to respond.

    Senator COHEN. Thank you very much.

    Mr. DUNCAN. Thank you very much for being with us today.

    As previously announced, we've had requests that the first panel testify—that each of the three witnesses testify separately, and so we will call up the first witnesses at this time, and that is The Honorable Jim Hall, who is chairman of the National Transportation Safety Board.

    Mr. Hall, if you will remain standing for a moment, as announced in my opening statement, we will swear in all the witnesses today, because this is an investigative hearing.

    Would you raise your right hand, please?

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    [Witness sworn.]

    Mr. DUNCAN. Chairman Hall, thank you very much for being here with us today. You may begin your testimony.


    Mr. HALL. Good morning, Chairman Duncan, Chairman Shuster, Congressman Lipinski, and Congressman Oberstar, and members of the committee. I appreciate the opportunity to be here this morning and congratulate you for holding these timely hearings.

    Accompanying me this morning are some members of the ValuJet investigative team who are also present in case there are any questions that come up that I want to refer to them.

    It has been 6 weeks since ValuJet Flight 592 crashed into the Everglades following an in-flight fire, killing all 110 persons aboard. Since that time, the FAA has grounded the airline, and as this morning's hearing shows, many questions have been raised about ValuJet's operations and the FAA's oversight of those operations.

    While we have had differences with the FAA over the years, our relationship has always been professional and it has worked to benefit the American people.
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    In an industry that has seen traffic grow from 106 million passengers in 1967, the year the Safety Board opened its doors, to 545 million passengers last year, a fivefold increase, the fatal accident rate has dropped, at the same time, almost 75 percent.

    Mr. Chairman, in 1995, just last year, for example, there was one fatal Part 121 scheduled airline accident fatality for every 4.1 million flights.

    This remarkable safety record did not happen by chance, but by the dedicated efforts of thousands of inspectors, air traffic controllers, investigators, pilots, mechanics, manufacturing personnel, and through the oversight, policy, and budgetary support provided by you and your colleagues in Congress.

    Mr. Chairman, 18 months ago, after a series of fatal accidents, Secretary Peña convened an airline safety summit here in Washington, D.C. It provided a forum for Government agencies and the airline industry to establish heightened safety goals.

    Several hundred senior Government and airline officials attended that 2-day meeting. While at the time I praised the decision to hold the summit, I noted in my speech to the summit that absent from the agenda were certain issues the Safety Board had addressed over the years—issues like airline management, FAA oversight, and corporate culture. Without addressing these issues, I felt we could never approach the summit's goal of zero accidents.

    Although the aviation industry has taken the necessary steps over the years to prevent most accidents through the systematic elimination of hazards and the use of technology to overcome human failures, I question how far we have come in challenging corporate cultures that do not put safety first.
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    Mr. Chairman, that is a question we must continue to address. How far have we come to eliminate a management mind set that allows unsafe practices to flourish at airlines or go undetected at the FAA?

    This hearing has been convened to examine issues raised by the ValuJet crash. No issues more directly concern the circumstances of this accident than the carriage of hazardous materials on aircraft and fire protection on airlines.

    I am sorry to say, Mr. Chairman, that, while we have not yet determined what exactly happened aboard Flight 592 that fateful day, I would not be surprised if, at the conclusion of this investigation, we find that this accident is a result of previous lessons learned and ignored or forgotten.

    As you know, Mr. Chairman, we recently concluded the recovery efforts in the Everglades after an unprecedented month-long search for wreckage, and on the part of the medical examiner, for the remains of victims.

    While our investigation is continuing, some very important facts have emerged.

    It appears that about 5 minutes after takeoff the crew of Flight 592 decided to return to Miami after hearing a noise and reporting smoke in the cabin to air traffic controllers.

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    Wreckage examination indicates an extremely intense fire in the aircraft—hot enough to melt seat railings and floor beams.

    We know the forward cargo compartment carried oxygen generators—perhaps more than 100—packed in cardboard, and at least three airplane tires. It appears that at least some of the generators were not empty, as labeled on the shipping papers, and none were equipped with a safety cap.

    What actually caused the plane to plunge into the Everglades—for example, was the crew incapacitated, or was the aircraft rendered uncontrollable—is unknown at this time, but these facts raise the very real possibility that warnings the airline industry and its regulators received through close calls in previous years, which are discussed in my submitted testimony, went tragically unheeded.

    One of these close calls involved a DC–9 that landed in Nashville on February 3, 1988, with a fire in the cargo hold. The pilot had no way to detect the fire except through reports by cabin personnel that the floor was hot and soft. They also had no way to fight the fire while in the air.

    Mr. Chairman, despite Safety Board recommendations to the FAA to require fire detection systems and fire extinguishing systems and better fire-blocking materials in cargo compartments, the sad fact is that the crew of ValuJet Flight 592 had no more equipment available to warn them of a fire or to fight it than the crew of that DC–9 flight over 8 years earlier.

    The Department of Transportation's program to regulate the transportation of hazardous materials by air and its regulations to protect aircraft and occupants from the effects of fire on airliners will be major focuses of our Board's ValuJet investigation.
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    A focus of today's hearing, Mr. Chairman, is whether there are systemic problems with the oversight of airline operations and maintenance, particularly in those segments that are outsourcing to contractors.

    The Safety Board first addressed the issue of FAA oversight of contract maintenance operations 20 years ago, following an accident in Van Nuys, California. We addressed the issue of contract maintenance again in 1982 following a Boeing 737 accident here in Washington, DC

    The ValuJet tragedy again has shown a spotlight on an evolution that has occurred in segments of the airline industry. The Board has expressed its concern previously about airlines carrying out their own maintenance programs properly in past accident investigations which are discussed in my full testimony.

    Now we are looking at what some have dubbed a ''virtual airline—'' one that provides transportation but conducts none of its own maintenance and training.

    As part of our investigation of this tragic accident, we will analyze how carriers that outsource these services are ensuring the safety of their operations.

    We will also analyze the effectiveness of the FAA and its NASIP program to ensure its compliance with safe practices.

    This brings me to an observation, Mr. Chairman.
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    Last week the FAA announced that it would now require airlines to demonstrate the regulatory compliance of each of their major contract maintenance programs and facilities. The implication is that the airlines have not done that until today. If this is true, Mr. Chairman, then we may not just have a ValuJet problem here; we may also have an FAA problem.

    In conclusion, Mr. Chairman, the ValuJet accident has brought to the forefront the ongoing issues of the need for stronger rules to protect airline passengers from fire dangers aboard airliners, including rules governing the acceptance and carriage of hazardous materials.

    The Board will also be examining the FAA's ability to provide adequate oversight to startup carriers, particularly those that undergo rapid expansion and contract and maintenance operations.

    Finally, Mr. Chairman, we will look closely at whether corporate culture played any role in this tragedy.

    This will be an exhaustive investigation, Mr. Chairman, because these are issues that must be resolved.

    That completes my oral remarks, Mr. Chairman. I would hope that my full testimony could be submitted for the record.

    Mr. DUNCAN. Your full testimony shall be placed in the record, Mr. Hall, and we'll get to questions shortly after we hear from some other witnesses.
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    The next witness will be Ms. Mary Schiavo, who is the Inspector General for the Department of Transportation.

    Ms. Schiavo, would you stand and raise your right hand, please, and be sworn?

    [Witness sworn.]

    Mr. DUNCAN. Thank you very much for being with us today. You may begin your testimony.

    Ms. SCHIAVO. Thank you, Mr. Chairman. Good morning. I appreciate the opportunity to be here.

    With your permission, I will submit the full statement of the Office of the Inspector General for the record. I know that time is limited.

    Mr. DUNCAN. The full statement will be placed in the record.

    Ms. SCHIAVO. I want to do that because after the opening statements here today, I believe there are a few other things that need to be said that are not in my statement, and I feel compelled to respond to them.

    In answering the question of what is wrong at the FAA, at least for myself and my office, we only have to go back through the history of what I have been doing for 5 1/2 years.
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    Starting in 1991, we were addressing these very same issues. We were asking what is wrong with FAA inspections. We came up with a virtual laundry list of things that were wrong.

    We had a hearing. Many distinguished Members of Congress made some important points and asked some important things of the FAA. There were promises made and promises not kept. This is back in 1991—totally different leadership, totally different administration, but the problems go on.

    We found problems in safety oversight, problems in maintenance, problems in repair stations, problems in foreign-manufactured parts. That was an interesting study, as the FAA is supposed to conduct surveillance over the manufacture of foreign aircraft parts.

    When we started that study the FAA said, ''You got us. We do not do it.'' Bogus parts—we all know I have had a big program to combat bogus parts. When my office first got in bogus parts, the FAA actively—I have a letter in writing. This was back, again, in the previous Administration from the then administrator of the FAA saying to the Secretary, ''Get the IG out of bogus parts. The airlines do not need it right now because it will cost them money.''

    Since then I am pleased to report we have approximately 150 convictions, and we have done a lot to clean out bogus parts, but we had to start that initiative without the active support of the management of the FAA, even though in every instance—and kudos to those inspectors out there and to those brave men and women who have come forward to Senator Cohen, have resorted, I might add, to calling me at my home because they are so afraid of the FAA, and have come forward to tell the truth about it.
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    It was the inspectors that were with us in every step of the way. In every single prosecution we brought, we could not have made a bogus parts case without the FAA inspectors in the field.

    But something goes wrong as you are going up the chain of command, and the something that goes wrong appears to be judgment somewhere along the way.

    So bad is this problem that earlier this year I sent a memo to the head of the FAA saying, ''From all of our work and from the things that we have seen, we believe that there is a culture of unaccountability at the FAA.''

    We found that in things where common sense—I mean, you do not have to be a safety engineer, you do not even have to be a bureaucrat to figure out that some things are really wrong.

    For example, we had a whole string of reports such as the buyouts that the Government approved to get the ranks of the Government down and to shrink the size of Government. The FAA was using them, and some of the people were coming right back, in one instance the next day.

    We had problems over their management of things like move money, of what has come to be known as the ''free travel perk,'' and that is where they ask the airlines for a quarter of a million tickets a year for training, and they were using them for the vacation.

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    So not just in one area in inspection and safety oversight, but in many areas we found there was simply no accountability.

    We will not even begin to get in the problems that were uncovered with the replacement of the air traffic control system, which, of course, the original one, AAS, eventually had to be scrapped and basically started over.

    Finding after finding we have come up with in my office, not through one Administration, but through two, three—through several Secretaries, through several administrators. Yet, we got two answers every time we found problems: one, ''Well, safety has not been compromised.''

    One thing we found in preparing for Senator Cohen's bogus parts hearings is that the FAA did not have a definition of what safety is and when it is compromised. It turned out it was when one or two people say it is, and that was the definition.

    ''Yes,'' they said, ''but there has never been a major crash.'' That is how they earned the nickname ''The Tombstone Agency.''

    Now, that is not a very polite name for our Nation's premier air safety agency, but I did not make that up. That has been their nickname for some time—not just this Administration, but for several Administrations.

    Our safety agency is called ''The Tombstone Agency.'' Why? Because they wait for major loss of life before they will make a safety change.
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    Now, is this a resources issue? Heaven knows everybody wants more safety oversight and more inspectors, and every Government agency believes that they need more people. I am sure that the FAA is no different, and there are several areas where, in our work in the Office of Inspector General we have said, ''Give the FAA more resources.'' But let us look at ValuJet.

    They conducted almost 5,000 inspections before the crash—5,000 inspections. Would more money and more inspectors have changed it? And only after the crash and, I might add, after the public scrutiny, after the media started digging, and after some whistleblowers came forward was there action.

    ValuJet is kind of a microcosm for the problems that we have uncovered at the FAA—inspections, maintenance, contractors—that has been an important issue and problem, contracted-out maintenance. We have reported numbers of problems which we found studying bogus parts—for example, repair stations had bogus parts anywhere in numbers from 45 to 95 percent, depending where you got the parts.

    A lot of people ask me what caused my office and myself to come forward and start questioning the oversight of ValuJet back in February, and it seems kind of simple: they had five incidents in a very short period of time.

    They had one incident which one official at the FAA told me was impossible to actually occur—an uncontained engine failure. I have a memo where they said, when we were working bogus parts cases, that if an engine explodes the housing will contain it and you will not have shrapnel flying through the fuselage of an airplane ripping people apart. It would not happen. Of course, a month after the bogus parts hearing, exactly that happened to ValuJet.
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    But the last straw was a blizzard. In that blizzard the planes were grounded, nobody could go anyplace, we could not go anyplace. In D.C. you could not get two blocks. Everybody remembers that. But one jet took off—one. The pilot of this particular company decided he or she was going. It was ValuJet. Again, it belies a judgment issue.

    By the way, the same thing happened yesterday, for any of those of you who are curious. In the midst of all the tornadoes, etc., one carrier chose to take off.

    The problem on judgment boils down to many things, but in one particular case—something I have been arguing since 1991—it boils down to, among other things, the dual mandate. You can not have the Nation's safety agency having responsibility for promoting aviation and for regulating safety.

    Now, I know you will tell me that whenever you pass a regulation OMB takes a cut on what the financial impact will be on the industry. We all know that. I have worked in other departments. I have worked in departments that pass regulations and do safety such as safety of our workers and miners. That could not take a second seat to safety of aviation. But they do not have that as part of their mission.

    Sure, they consider what the financial impact is, but they do not do it every day.

    In response to disasters and death, they do not cite, ''But we have to promote aviation.''
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    So it is going to take more than simply deleting promoting aviation from their mandate. That is a simple word fix. It is going to take a culture change, and it is going to take a change in judgment—how you look at problems, what you do when the NTSB tell you it is time to change.

    You can not just say, ''Well, we will do it like we always do but, 'wink-wink,' we do not have that job any more.''

    The problem with the judgment in the culture is so ingrained. I am going to cite another example from some of our bogus parts battles, and that was when—again, this was back in 1991 or 1992. The Secretary was so concerned about the problem that we had a briefing of the Secretary and all the senior staff, and the head of the FAA walked out of the briefing. Maybe he had a good reason. I do not know. But after that he sent a letter saying, ''Shut it down. Shut down the investigations of the bogus parts because we have got to promote aviation.'' I have it in writing.

    Now we hear that the truth is scaring the public. Well, again, that is what you would expect if your job is promoting aviation. You would treat the public like poor dupes who have to be kept in the dark about the facts, but this is the United States of America and that is not how we operate.

    Time and time again we have made recommendations, as has the NTSB, and we have also seen incidents, but we get the same answer, ''It does not affect safety,'' or, ''There has not been a major crash.'' When I was first invited to this hearing—this will probably come as a surprise to the Members, but this is what I was told by staff, who are going to remain nameless to protect them, but I was told that the purpose of the hearing was to take a major hunk out of my hide for my statements concerning ValuJet and other things.
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    I find that very interesting. I find that very interesting because, unless certain people blew the whistle, I wonder where we would be today. Would all the truth have come out? Would all of these things have come out about ValuJet? Would all of these memo that have dribbled out one at a time—the 7th, the 14th, the 20th, the May 3 memo—we have had to get them piece by piece as brave individuals within the FAA have told the truth.

    Let us turn our attention for a minute to the May 2 report. This report to me is just astonishing, not because what is in it, because the FAA spins data all the time. They have piles of data. We asked for a data tape a few weeks ago. There was so much data on the tape our computers ran all night, and we have big computers. Our computers ran all night and they never did get through this data spin.

    But this May report is interesting because there were people on television citing from this May report about how safe and how equally safe—all carriers are equally safe, and how safe ValuJet is. On the very cover of this report it warns that ValuJet—and, by the way, one airline, I might add, that has a rate about—I have not figured it out, but roughly four times that of ValuJet, is cited in this report.

    It was only days later that the rest of the facts of that report dribbled out, but we had it in our hands. What was I to do? Sit by and allow false implications to go forward? I do not think so.

    Now, what about accident predictions? Sure, I have mentioned the accident predictions because now is the time to act. I do not think we wait on crashes. I do not think we wait on body counts. And I do not think we wait on bloodshed. Frankly, I am horrified by the ValuJet crash, and I think we all should be horrified.
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    But about that safety prediction, which I have been criticized for mentioning publicly, you know, this safety prediction has been floating around the Department for several years. I was at a meeting years ago when the FAA said that they predicted by some time after the turn of the century the rates would go up astronomically, but nothing was allowed to be told to the public.

    Boeing came up with the same study. Yet, when I mentioned it, it is scaring the public. Well, let me tell you something: the FAA administrator actually made this in a statement, ''A recent study by Boeing projects that, given the forecast growth in air travel, if worldwide aviation maintains the same level of safety that it has for the past 5 years, by the year 2013 we can expect to lose one aircraft worldwide every 8 days.''

    You know what? That is worse than what I thought. I thought it was something like between a week to 15 days. One every 8 days. And yet, that was talked about in the industry, it was talked about in the Department, but, ''wink-wink,'' boy, we can not tell the public.

    This is the United States. Of course we can tell the public. We work in the sunshine. Our documents are subject to the Freedom of Information Act. And why should not the public not know? Why should the public not have known about ValuJet's record back on May 2 when this report came out? I will bet a few people would not have been on that plane.

    Now, let us look at the NTSB record. The NTSB, God bless them, has an amazing and, in many respects, awful job to do. For years they have been making recommendations—life-saving recommendations. And they make recommendations to many people, but they also make recommendations to the FAA and about the FAA.
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    I have mentioned that, and I have mentioned that because I am upset that the FAA has been cited as a cause or contributing factor in 241 accidents involving 131 fatal accidents with 970 fatalities from the period 1983 to 1995.

    Ladies and gentlemen, these are not my statistics. They come from the National Transportation Safety Board. Again, that bespeaks a problem with our national safety agency.

    So, again, you can complain about telling the public the facts, or you can complain about speaking with two voices. Frankly, in the light of blatantly untrue statements, I see no choice but to speak the correct statements, so I do not know how we can remedy that, or about scaring the public, or about taking a hunk for what we report and what we find, but we report, and as long as it is possible for us to do it, we will continue to find the problems and report the facts.

    I am not a safety expert. I am a lawyer. I am a prosecutor. I am a bureaucrat. I am a Government investigator. Many people have criticized that I'm not in the FAA. That is absolutely right. But many times we have forced changes through investigations, criminal prosecutions, and through approximately 1,000 convictions and $5 billion of findings over the last 5 years.

    It has taken often, I am sorry to say, criminal prosecution to force action. Who has been our ally in the criminal prosecution? We do not go to court. We are just the investigators. We are like a tiny, little, minuscule FBI—the Department of Justice.
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    The U.S. Department of Justice has been our ally in many, many of these cases and has taken things like bogus parts and run with the ball.

    Now, I have to say one other thing, because it was raised in the opening remarks, and that is about commuter aircraft.

    We do lots of work. Heavens. We have hundreds, if not, in some years, depending on our work load, thousands of findings and inspections and investigations, and you name it. But this spring we did an audit of the aging commuter airplane program run by the FAA. Everybody wants to know why I have been critical of commuters. Well, I am not particularly critical of commuters. I just cite the facts.

    The fact of the matter is that until this year commuters operated at a significantly lower level of safety. It is a fact. You can not argue with it. That was the law.

    And this Secretary—and it's a big credit to this Administration—said no. One level of safety. But, guess what? If you were a carrier already in operation, you have until next year to comply. And, not only that, once you comply, what is a huge problem with our aviation today? Our aircraft are aging, and everybody knows it. We have old fleets. And so what do you do to avoid another situation like Hawaii where an airplane was opened up like a sardine can and victims went flying out over the Pacific? You have an aging aircraft program.

    Guess what, folks? For commuter aircraft we do not. That is why I raised concern about commuter aircraft.
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    But, once again, I hear, ''You can not tell the public.'' I do not understand why not. I think the public is smart and sophisticated, and I will not lie to the public. I will not.

    I think Americans have a different view of all this. I think Americans like to kick their tires, they like to honk their horns. They want to look under the hoods, and they want to know the facts, and they will get on their jump suits and they will check the oil and get under the car——

    Mr. DUNCAN. Ms. Schiavo, I am sorry, but in fairness to other witnesses, I will have to ask that you conclude in about 1 minute.

    Ms. SCHIAVO. All right. I certainly can.

    But they can not do that with the 727. The people who are supposed to do that for them with the 727 is the U.S. Government. It is the FAA. It is the DOT. It is everyone. That is what they rely on us for, and they do not think that that has been done for them. That is why we report our findings, be they good or bad, and that is why I think it is important to do so.

    Thank you.

    Mr. DUNCAN. All right. Thank you very much.

    I can assure you that no Member has brought you here to get a hunk of your hide, and if any staff member told you that they have been reading too many novels or watching too much television. We will—that is not the purpose of this at all.
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    Our next witness is The Honorable David R. Hinson, who is administrator of the Federal Aviation Administration.

    Mr. Hinson, will you stand and raise your right hand, please, and be sworn, and also Mr. Broderick, Mr. Anthony Broderick, who is the associate administrator, is going to testify also. Will both of you please raise your right hands and be sworn.

    [Witnesses sworn.]

    Mr. DUNCAN. Mr. Hinson, you may begin your testimony.

    Mr. HINSON. Thank you, Mr. Chairman, and good morning to the distinguished ladies and gentlemen of the committee.

    Mr. Chairman, I would ask that my formal remarks, written remarks, be entered into the record.

    Mr. DUNCAN. They will be entered in the record.

    Mr. HINSON. Mr. Chairman, this is my 28th hearing since I have had the privilege of serving as the administrator of the Federal Aviation Administration. I have appeared before this committee many times, under your leadership and under Mr. Oberstar's leadership. It has been my observation that this committee has been essentially bipartisan and has dealt with safety matters in an unambiguous and straightforward way, which I want to acknowledge and express my appreciation for to you and the Members.
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    Now, Mr. Chairman, the last 6 weeks have been a real challenge for me and for my colleagues at the FAA, for obvious reasons, and we have heard many of those this morning, but I would like to make one or two comments.

    The first point I want to make, Mr. Chairman, is that I listened to Chairman Shuster's comments this morning on television, and I want to express my appreciation to him, as well, for his willingness in his statement, I believe, as I recall, to say that the questions of aviation safety have to be dealt with in a calm, rational manner.

    I believe that is the essence of what the chairman said, and I appreciate that, and I want him to know that, as well.

    Mr. Chairman, in 1978, when this Body and the Senate deregulated the industry—it has been written recently in one of the local papers that there was a fatal accident every 860-some thousand departures in the United States. Now, 17 years later, there is a fatal accident every 1.82 million or so departures.

    During that time, Mr. Chairman, the number of passengers has gone from about 266 million to almost 600 million.

    In other words, Mr. Chairman, we have had the best of both worlds. We have had an aggressive, expanding airline industry, and we have had a safety rate in terms of fatalities, fatal accidents per departure, that has improved by more than 50 percent. That is a remarkable achievement, and I want to assure you the FAA has been a very important part of that success.
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    I also want to say that I am pleased to note that the Inspector General commented on the fact that many of the problems that she has discussed and that have been pointed out by others preceded me.

    And I also want to make the point that I agree with a number of things that the Inspector General has said and a number of the reports that they have submitted to the FAA. In fact, we concur on a high percentage of their recommendations, and they are an important function for us.

    And I also want to point out that I have spent the last 3 years trying to address many of the problems I inherited. It is important for this committee to note that.

    I also want to say one or two other—I will make one or two other small points here, and then I will be pleased to accept your questions.

    When there is an accident the FAA, as a family, immediately becomes very introspective. I do not know of another agency that looks harder at itself after an accident, particularly one this tragic, as the FAA. We did just that after the crash in Florida.

    As a result of this, Mr. Chairman, there were four issues that I believe are before the FAA and therefore before this committee, and I want to say what those are and talk briefly about them.

    The first is the transportation of hazardous material. I will come back to that.
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    The second is ValuJet's compliance with Federal Aviation Regulations. I will come back to that.

    The third is the allocation of FAA resources and assets relative to its inspection oversight capability. I will come back to that.

    Finally, the issue of making sure that the agency has a permanent, long-term, dependable funding source, because it is critical to what we have to do in front.

    Let me talk first about HAZMAT. Hazardous material transportation is a very important subject. While the NTSB has not reached a final conclusion on their accident investigation, the evidence suggests, as the chairman of the Board said a moment ago, that there was, indeed, a very hot fire on the aircraft. We also know that hazardous material was loaded on the aircraft in the form of oxygen generators, apparently unmarked as hazardous material.

    This drives two questions, Mr. Chairman: why and how did that happen? That is to say, how did hazardous material get tendered to an air carrier unmarked? Second, and most important, what can we do to prevent it again? That is the essence of the issue.

    Now, with respect to ValuJet's compliance with Federal Aviation Regulations, let me start with a comment. There is no apparent relationship between the accident and any issues of compliance at ValuJet. The problems at ValuJet, from a compliance perspective, in my opinion, are a function of their rate of growth, and require us to reassess the way in which we look at the rate that an air carrier grows.
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    Retrospectively, I have said and will say here this morning that we should have done a better job of helping ValuJet manage their infrastructure, their management infrastructure, especially with respect to maintenance, if they were going to grow at the rate they chose to do.

    The third point, Mr. Chairman, was the allocation of the inspector work force. The efficient use of assets and resources is essential if the FAA is to do its job.

    Mr. Chairman, last year I commissioned a study called ''Challenge 2000.'' I believe one of the participants will testify in the next panel. The purpose of Challenge 2000 was to answer a question that I asked, which is: how can the FAA do more with less? It is apparent to us that our financial future is difficult, and that we work in an expanding demand for services, and we want to make sure that our safety and inspection oversight capability is able to deal with that issue.

    It has also been the principal driver for the Safety Performance and Analysis System which is an automated approach to inspection and certification. Its acronym is SPAS.

    The fourth issue, Mr. Chairman, is funding. Right now the Federal Aviation Administration is in the worst of all worlds. The Trust Fund is no longer receiving any income. The taxes have expired—the four taxes. The unobligated balance of the Trust Fund will be extinguished by December or January. From that point forward, assuming nothing is done, 100 percent of the Federal Aviation budget must come from the General Fund, with all of the attendant complexities and competitions.
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    Our data, our budget data, based upon the forecasted balanced budget mark between the House and the Senate, as published, shows that by 2003 the FAA will be $12 billion short in our ability to provide a current services budget.

    Said another way, Mr. Chairman, just to do what we are doing today, not to expand or add capability, we are going to be $12 billion short if we get our pro rata share of the balanced budget forecast.

    That, for us, is a serious problem. It points out some issues that we are all aware of.

    Every day the agency has to make tradeoffs. In our management, we decide, for example, how much to invest in hazardous material compliance versus how many inspectors to have; how much explosive detection work to do versus, for example, how to do more research on the prevention of mid-air collisions; how much more work to do on control flight into terrain and research there versus how much money we can spend on developing free flight.

    These tradeoffs in safety and their direct application are issues we deal with every day, Mr. Chairman. Historically, this Committee has been a very important part of how we make those decisions, and I think historically we have been very successful. The problems, Mr. Chairman, are in the years in front of us, and the funding of the FAA is a critical matter.

    Mr. Chairman, this concludes my informal remarks, and Mr. Broderick and I are ready to answer your questions.
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    Mr. DUNCAN. Thank you very much, Mr. Hinson. We will go for the first questioning to Chairman Shuster.

    Mr. SHUSTER. Thank you, Mr. Hinson. We certainly appreciate your being here, and I appreciate your cooperation over the years in which you have been in your position.

    You have an extremely difficult job, and I know first-hand from my discussions with you, that not only is your heart and soul in the job, but that you have brought to the job an extraordinary background. You were the chief pilot, I believe, of Northwest Airlines; you were president of an airline; you worked for one of the major aviation manufacturers. This is an extraordinary background, and we respect that, and I want to emphasize that to you.

    I agree with you that the FAA employees, overall, do an outstanding job. We need their cooperation. I am sure you agree with me that neither you nor this committee will tolerate any retribution against any FAA employees, and I assume, shaking your head yes, that is a ''yes'' answer.

    Mr. HINSON. Yes, sir. I have communicated that in more ways than one, and more than once.

    Mr. SHUSTER. One of the things I want to do, Mr. Hinson, is try to understand the decisionmaking process at the FAA that led up to the grounding of ValuJet.
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    As you well know, several newspapers, both the ''Wall Street Journal'' and the ''Washington Post'' have reported that the decision to shut down ValuJet and fire Mr. Broderick were made only after a meeting at the White House on Monday, June 17. I assume that you acknowledge having attended a meeting at the White House on that day?

    Mr. HINSON. Well, I was there, Mr. Chairman, but I would be pleased to explain the whole circumstance, if you would like.

    Mr. SHUSTER. Who was at the meeting?

    Mr. HINSON. Which? The one at the White House?

    Mr. SHUSTER. Yes.

    Mr. HINSON. The Secretary, myself, his Chief Counsel, Mr. Panetta, Mr. Stephanopoulos, Ms. Higgins, an attorney who I do not know, and another woman who I do not know.

    Mr. SHUSTER. Was Mr. Broderick there?

    Mr. HINSON. No.

    Mr. SHUSTER. When was this meeting held?

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    Mr. HINSON. The 17th.

    Mr. SHUSTER. At approximately what time? That was Monday, last Monday?

    Mr. HINSON. About mid-day, 1, something like that.

    Mr. SHUSTER. Who initiated the meeting?

    Mr. HINSON. I do not know.

    Mr. SHUSTER. Who would know the answer to that question?

    Mr. HINSON. I was invited to the meeting by the Secretary.

    Mr. SHUSTER. Yes. Before the meeting was initiated, had the decision been made to ground ValuJet?

    Mr. HINSON. Yes.

    Mr. SHUSTER. When was that decision made?

    Mr. HINSON. That decision was made at 6:30—between 6:30 and 7:30 on Monday morning, the 17th, in consultation with Mr. Broderick.

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    Mr. SHUSTER. Excuse me. In——

    Mr. HINSON [continuing]. Consultation with Mr. Broderick.

    Mr. SHUSTER. Who made that decision?

    Mr. HINSON. It was a recommendation of the Atlanta Flight Standards Office through Washington. That recommendation was accepted by Mr. Broderick and recommended to me, and I accepted their recommendation.

    Mr. SHUSTER. Was anybody else involved in consultation?

    Mr. HINSON. No, sir.

    Mr. SHUSTER. Was the Secretary involved?

    Mr. HINSON. No, sir.

    Mr. SHUSTER. Who presented the information? You say it was the Atlanta flight safety people?

    Mr. HINSON. That is correct.

    Mr. SHUSTER. Did they come to Washington?

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    Mr. HINSON. No, sir. They made that decision in Atlanta and made that recommendation to Mr. Broderick.

    Mr. SHUSTER. Would that have been Mr. Accardi and Mr. White?

    Mr. HINSON. Mr. Accardi and Mr. White were in Atlanta on Saturday and Sunday reviewing the analysis that the flight standards office had done of the some 2,000 inspections that had been completed, plus other data.

    Mr. SHUSTER. Who were the individuals, the names of the individuals, that made the recommendation that you referred to?

    Mr. HINSON. Let me ask Mr. Broderick to help me with that, because I do not know everybody in Atlanta.

    Mr. BRODERICK. Well, I can not name all of them, but Mr. Spillner, Mr. Chairman, is the manager of the flight standards district office. He and the three principal inspectors for operations, avionics, and maintenance made that recommendation to their division manager, who is Mr. Sacrey. I am giving you a chain of command. Mr. Sacrey concurred in that recommendation and passed it on to Mr. Accardi and Mr. White, who passed it on to me, in that sense.

    But in an actual discussion sense, all of them—Accardi, White, Sacrey, Spillner, the principal inspectors—were in Atlanta on the weekend at one end of the telephone, and I and my deputy were at the other end of the telephone.
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    Mr. SHUSTER. Was there anyone who dissented from that recommendation?

    Mr. BRODERICK. No one of which I am aware, sir.

    Mr. SHUSTER. Mr. Hinson?

    Mr. HINSON. No, sir.

    Mr. SHUSTER. According to press reports—and, of course, we all know that press reports are not always totally accurate—as late as the previous Thursday afternoon your staff in the southern region were negotiating with ValuJet on a consent order that would have limited their flights and their routes, but allowed them to continue operating. That is correct, is it not?

    Mr. HINSON. Do you want to answer that, Tony?

    Mr. BRODERICK. I do not know specifically if somebody was still talking about that. I can tell you that Wednesday afternoon the general thinking was as reported in some of the media, that that was the way things were turning out.

    Thursday morning I was informed that things looked like they were going in a different direction, and it was then that I was first aware of the fact that it looked like, instead of some kind of an order that would just reduce the size of the airline, that the inspectors and managers in Atlanta thought that something much more severe was called for by the data analysis that they were performing.
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    Mr. SHUSTER. Is not it true that the manager of the southern region, Mr. Sacrey, I believe, and the head of the Atlanta Field Office, Mr. Spillner, had reached an agreement in principle with ValuJet to allow them to continue to fly 36 planes on 20 lines of operation? In fact, they had even gone so far as to draft the language that would have gone into the consent order and the ValuJet operating specifications by mid-day on the Thursday?

    Mr. BRODERICK. I believe that was true as of Wednesday, sir.

    Mr. SHUSTER. It was no longer true as of Thursday?

    Mr. BRODERICK. Yes. In fact, I——

    Mr. SHUSTER. Yes it was true as of Thursday?

    Mr. BRODERICK. Yes, it was no longer true as of——

    Mr. SHUSTER. It was not——

    Mr. BRODERICK. —Thursday morning.

    Mr. SHUSTER. It was not true?

    Mr. BRODERICK. That is right. I placed a phone call to Mr. Sacrey on Thursday morning because I, for some reason that I can not quite remember, had heard that he was concerned that the down-sizing, if you will, was not an adequate remedy, and we had a discussion about whether or not that was the case, and he, in fact, agreed that that was the case—that is, that the downsizing may not be a sufficient action.
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    Mr. SHUSTER. Is it true that on June 7, Mr. Spillner sent a document to you, an interim report, document number 23, which we have, to Washington? Let me quote from that report—which, Mr. Chairman, I ask be made a part of the record.

    Mr. DUNCAN. It may be made a part of the record.

    [The referenced material follows:]

    [Insert here.]

    Mr. SHUSTER. I thank the chairman.

    The analysis section says, under the recommended corrective action, ''The evidence raises a reasonable basis to question whether ValuJet's airline maintenance program is adequate. This is mitigated by inspection reports since May 28, 1996, which indicate that some improvements have been made.'' So that report says that, while there were some problems, the problems had been mitigated. Is that accurate?

    Mr. BRODERICK. That was accurate on that date, sir. I remember that. There are other—that was a dynamically changing report. It exists in various iterations with conclusions that were accurate at the time that it was drafted.

    Mr. SHUSTER. But what changed between the time that was written—between Wednesday, as you say, and Monday? What new information became available that caused you to change your mind?
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    Mr. BRODERICK. I did not change my mind, sir. It was Mr. Spillner, the principal inspectors, and the folks in Atlanta who determined that the data that they were analyzing and the facts that they were seeing pointed, instead of to a series of isolated instances that were not connected—in addition, they began to see a systemic pattern which gave them concern for the fundamental infrastructure in some critical parts of the airline safety organization.

    Mr. SHUSTER. Is it fair to say that there was no new evidence, new occurrences, that actually took place, but rather the analysis of old information that caused them to come to this conclusion?

    Mr. BRODERICK. That is true, but I would want to add to that that it is the—there are inspection results that may have existed yesterday or the day before that a person looking at today considers new information. It is not a new event, but it is new information into the decisionmaking process.

    It was this kind of analysis and new information brought to bear on the analysis that I believe gave them a reason to make the determinations that they did.

    Mr. SHUSTER. Thank you.

    Mr. Hinson, what was the purpose of the meeting at the White House if these decisions had already been made?

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    Mr. HINSON. Why do not I—Mr. Chairman, if I may, why do not I take you through the whole chronology?

    Mr. SHUSTER. Well, I had appreciate it if you had answer what was said at the White House. You told us who was there and when it was. What was said?

    Mr. HINSON. Well, after I finished briefing—Mr. Broderick and his staff and I finished briefing the Secretary about our decision around noon-time on Monday, the 17th, the Secretary informed me that I was to accompany him to the White House to brief the White House staff on this matter.

    I assumed, on the way over, that it was just to bring him up to date on what the issues were surrounding the grounding, what the results would be, what the issues were, and so forth—the normal information flow that would be appropriate in a matter of this significance.

    Mr. SHUSTER. Was Secretary Peña involved in the decision to ground ValuJet?

    Mr. HINSON. No, he was not. And when we got to the White House with the people that I had mentioned before, that is exactly what occurred. Questions were asked about why we were doing this, what were the circumstances, particularly in view of the fact that we had said 5 weeks earlier that the airline was in compliance and safe, and we were now saying it was not in compliance, which obviously causes some embarrassment, and they were concerned about that, as I was and am.
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    And had we called the appropriate Congressional delegations, had we called this Committee and other committees in the House and the Senate, and all of the things that you would normally expect that they would be interested in, representing the President of the United States—a very normal, as far as I could tell, meeting. I did not find it unusual at all.

    Mr. SHUSTER. Did anyone at the White House disagree with your decision?

    Mr. HINSON. No, sir. In fact, Mr. Chairman, since I have been the head of the FAA in 1993, the White House has never, in any way, asked, directed, or in any other fashion tried to temper or direct any of my decisions regarding any safety issues.

    Mr. SHUSTER. Let me ask you this: did you or your staff prepare any memoranda on your decision or for your meeting with the White House for use within the FAA or the Department, or did you provide briefing material to the White House staff?

    Mr. HINSON. I did not, sir. No.

    Mr. SHUSTER. Did your staff?

    Mr. HINSON. I do not remember whether we took any paperwork to see the Secretary or not. I did not take any paperwork to the White House, nor did anybody that was with me, that I am aware of.

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    Mr. SHUSTER. Press reports in the last few days have disclosed that ValuJet is not unique. The FAA has grounded, under your watch, several other airlines in recent years, including Kiwi, Express One, and Arrow Air. I am curious. Did you ever go to the White House to discuss shutting down those airlines?

    Mr. HINSON. Not that I recall, sir. No.

    Mr. SHUSTER. Do you know of anybody else communicating with the White House on that?

    Mr. HINSON. I do not know.

    Mr. SHUSTER. It is also curious, then. What would the reason be for going there to discuss ValuJet when you did not go there to discuss the grounding of these other airlines?

    Mr. HINSON. I think for a very obvious reason. I am the principal aviation person in this Administration. ValuJet had an enormous amount of publicity in the previous 5 weeks or so. I had said publicly that the airline was compliant the day after the accident. I was now about to say it was not. This is obvious cause for concern, for a whole host of reasons that again I think are obvious.

    I think the White House staff appropriately wanted to be able to answer the President's questions if he asked any, and so I——

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    Mr. SHUSTER. Let me turn to another topic concerning Mr. Broderick.

    When was the decision made to fire Mr. Broderick?

    Mr. HINSON. Well, I did not make a decision to ''fire'' Mr. Broderick. Mr. Broderick and I had consultations over the previous 3 or 4 weeks before Monday, the 17th, about various concerns that I had with the certification regulation organization. We discussed a number of options about what we could and couldn't do. And on Monday morning, the 17th, at 6:30, when he and I met to discuss the ValuJet grounding, he handed me a piece of paper which indicated he would elect to retire at the end of this month.

    Mr. SHUSTER. Mr. Broderick——

    Mr. HINSON. I must say I accepted that with mixed feelings.

    Mr. SHUSTER. Mr. Broderick, why did you make the decision to leave the Agency?

    Mr. BRODERICK. Well, Mr. Chairman, as the Administrator said earlier, this past 6 weeks have been extraordinarily challenging ones for the FAA, and we all have to look inside and find out what we can do to help the agency in the best possible way to get beyond this and look to the future.

    It was clear to me that the Administrator felt a need, was under an awful lot of pressure to fix the problems at the FAA. I am the senior safety person at the FAA and have been for some number of years, as you and your colleagues know. Clearly I bear some responsibility for the state that we found ourselves in a week ago last weekend.
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    We had some detailed discussions on Saturday about various organizational change options that might occur.

    Mr. SHUSTER. Let me ask you, Mr. Broderick: was it suggested to you, implied, conveyed in any way by the Administrator or anyone else that you should retire?

    Mr. BRODERICK. No. In point of fact, just the opposite. Quite frankly, the administrator I think wanted to find an organizational arrangement within the FAA in which I would stay. I did not think that that was in the best interest of the FAA or, frankly, myself, and I elected to retire.

    Mr. SHUSTER. So do I understand your inference then that the administrator did convey to you that he wanted to remove you from your present position?

    Mr. BRODERICK. He wanted to make some organizational changes which involved part of my responsibilities. Airline oversight was one of those parts that he needed to make changes in.

    Mr. SHUSTER. And, based on the administrator's decision to want to remove you from your present position, was that a factor in causing you to decide to retire?

    Mr. BRODERICK. Well, Mr. Chairman, again, I wouldn't say that he said to me he was going to remove me from my present position. What he said was that we—and, as he indicated, we have talked about a number of organizational rearrangements over the past several weeks.
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    I didn't find any that I found acceptable from either a personal viewpoint or that I thought were the way the Agency should go. I thought I should give the Administrator the most flexibility possible in making whatever changes he deemed essential.

    Mr. SHUSTER. Let me make sure I understand what you just said. That went past us pretty fast. That you didn't find any of the organizational changes or some of the organizational changes that the administrator was proposing, ones that were—that you felt were proper or acceptable?

    I don't want to put words in your mouth, but I think I heard you say that you were not, in effect, in agreement with some of those organizational changes. You were not comfortable with them.

    Mr. BRODERICK. From a personal viewpoint, I didn't agree with the way the changes that he had suggested might be—might play out. Quite frankly, he also asked me for any suggestions I had. I discussed with some senior people in the FAA the possibilities, and I couldn't come up with anything that I thought was something that was in the best interest of myself or the——

    Mr. SHUSTER. What changes was the administrator talking about that you were personally not comfortable with?

    Mr. BRODERICK. Just the general idea of a change in the way we do airline oversight, from the viewpoint of dividing aircraft certification and flight standards as one of the options.
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    Mr. SHUSTER. Would you be more precise in specifying what organizational changes were being proposed that you personally did not feel comfortable with?

    Mr. BRODERICK. Well, the only one that we discussed in any detail was the dividing of the organization that I currently had into two elements, one of which was focused on airlines, the other of which was focused on aircraft certification and related activities.

    Mr. SHUSTER. And what did you find objectionable about that?

    Mr. BRODERICK. I don't think that dividing the engineering function in the FAA and the maintenance function is something that will advance the cause of safety promotion.

    Mr. SHUSTER. How do you believe—do you believe that the structure should have stayed the same?

    Mr. BRODERICK. No, I don't. I think that the Challenge 2000 activity that we have launched that you'll hear about later is an excellent beginning for positioning the agency for the 21st century, and I wouldn't predispose the agency or my organization to any particular change.

    I think we need to work with the people in it, who have extraordinary talents, and the customers that we serve both internally and externally, and determine what the best organizational arrangements are for the 21st century.
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    Mr. DEFAZIO. Mr. Chairman, could I inquire as to the time arrangements here? Customarily the committee——

    Mr. SHUSTER. If the gentleman had been here when we started the hearing, he would have heard the chairman say that the procedure in this investigative hearing would be that I would conduct the questioning from our side, and that a Member from your side would have equal time to conduct the questioning——

    Mr. DEFAZIO. And are we still on the topic of aviation safety and the ValuJet crash, Mr. Chairman?

    Mr. SHUSTER. I think that's obvious to the gentleman. If the gentleman had been here on time—and everybody else has agreed——

    Mr. DEFAZIO. I arrived about 3 minutes after the hearing started, Mr. Chairman. I'm sorry that I didn't know about the extraordinarily unusual procedure where an unlimited amount of time would be granted.

    Mr. SHUSTER. It's a procedure—if I may, Mr. Chairman—it's a procedure that your leadership agreed to, and so I would suggest that you take it up with your leadership.

    I'd like to continue now with Mr. Hinson.

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    Mr. Broderick, when will you be leaving the agency?

    Mr. BRODERICK. Friday is my last day, sir.

    Mr. SHUSTER. And, Mr. Hinson, have you decided to proceed with the new organizational structure which Mr. Broderick has outlined and which he seems to have a problem with?

    Mr. HINSON. Not at all.

    Mr. DUNCAN. So you have decided not to proceed with dividing the responsibilities, as he has outlined?

    Mr. HINSON. Not at this point. That's correct.

    Mr. SHUSTER. So you still are weighing your options?

    Mr. HINSON. Yes, sir.

    Mr. SHUSTER. When would you expect to make a decision?

    Mr. HINSON. I don't know.

    Mr. SHUSTER. Do you think organizational change is necessary in the light of the information that——
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    Mr. HINSON. Organizational change is always necessary because the FAA, like every other agency, is dynamic. It is not static. Circumstances change.

    One of the questions I posed to Mr. Broderick is how we could make sure, in light of what Challenge 2000 is recommending, that we go forward in the most efficient manner. It was in the context of really a very normal and typical management conversation about how we get the job done we're supposed to do.

    Mr. SHUSTER. You haven't set any time line for making these organizational changes that you think may be necessary?

    Mr. HINSON. No, sir.

    Mr. SHUSTER. Do you think it will be a month or——

    Mr. HINSON. I don't know, Mr. Chairman, for this reason: I have said—I did announce at the press conference on the 18th or 17th—I forget the date—18th, I guess—that I would personally help our H.R. organization conduct a search for the most qualified person we can find to take Mr. Broderick's place, and we are looking both inside and outside of the agency.

    I would hope that we could do that in a reasonably efficient amount of time.

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    Subsequent to that selection, in consultation with the new head of AVR, we will discuss all of these issues.

    Mr. SHUSTER. Mr. Hinson, I saw a press account this morning where you've announced that you will be leaving the FAA by the end of the year, if not sooner. That's the way it was reported. Is that an accurate report?

    Mr. HINSON. Mr. Chairman, every newspaper in the—everybody knows that except the ''USA Today,'' I guess. I have said that from day one. I said that in my confirmation hearing 3 years ago when the issue was the high rate of turnover of FAA Administrators. The President and the Secretary asked me to commit to stay their term. I made that commitment. I intend to honor it, and I intend——

    Mr. SHUSTER. What caught my eye was, if the account was accurate, it was not that you would be leaving by the end of the year, but rather the words were also in there, ''or sooner.'' Is that an accurate——

    Mr. HINSON. Well, it's always possible to leave sooner.

    Mr. SHUSTER. Is that your intention?

    Mr. HINSON. No, sir.

    Mr. SHUSTER. Thank you very much.

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    Thank you, Mr. Chairman.

    Mr. DUNCAN. Thank you, Mr. Chairman.

    Mr. Lipinski?

    Mr. LIPINSKI. Thank you very much, Chairman Duncan.

    It is my understanding that I have roughly about 25 minutes to allocate to the democratic side. Is that correct, Mr. Chairman?

    Mr. SHUSTER. No, that is not correct. Our agreement was that you have to allocate to a Member. It would be unfair to give more than one Member, because we're going to go side by side, but you or a Member has up to the same amount of time that was allocated to me.

    Mr. LIPINSKI. Well, can we agree on the second portion of my statement that it's 25 minutes? Did anyone time that? According to my watch it was 25 minutes.

    Mr. SHUSTER. Yes. I'm told that's the case.

    Mr. LIPINSKI. Thank you.

    Mr. NADLER. Mr. Chairman?

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    Mr. DUNCAN. Yes, Mr. Nadler.

    Mr. NADLER. I just want to ascertain that, after that, other Members on both sides——

    Mr. DUNCAN. After that we're going to go with the usual 5 minutes to every Member.

    Mr. NADLER. Thank you.

    Mr. DUNCAN. Every Member will have a chance to ask questions or make comments.

    Mr. LIPINSKI. Do I have the floor again, Mr. Chairman?

    Mr. DUNCAN. Mr. Lipinski.

    Mr. LIPINSKI. Thank you very much.

    In light of that, I allocate the 25 minutes that the democratic side has to the man who knows more about aviation than any man in the world, our ranking member, Mr. Jim Oberstar.

    Mr. OBERSTAR. Thank you, Mr. Lipinski. I appreciate your very thoughtful comment. It's a heavy burden to wear, however.
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    Mr. OBERSTAR. I want to follow up on the questioning that Chairman Shuster has initiated, and to do so, to pursue the question of the White House involvement and who initiated what.

    There are some missing pieces. At this point, Mr. Chairman, I would like to ask to come to the witness table and to be sworn in Nancy McFadden, the General Counsel of DOT, and Peggy Gilligan, who is the deputy to Mr. Broderick. I ask that the Chair swear them in.

    Mr. DUNCAN. Yes, sir.

    [Witnesses sworn.]

    Mr. OBERSTAR. Thank you, Mr. Chairman.

    Ms. McFadden, you've heard the previous questioning and the responses from Mr. Hinson about the chronology of what unfolded and in which sequence. I think it's very important for us to understand this matter, because——

    Mr. LAHOOD. Mr. Chairman, could we have these witnesses identify themselves? I don't know who they are, what their titles are, or what agency they're with.

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    Mr. OBERSTAR. If the gentleman would yield, I identified them at the outset. Nancy McFadden, General Counsel of DOT; and Peggy Gilligan is a deputy to Mr. Broderick.

    Mr. DUNCAN. All right. You might have—for the record, I'll have each of you state your name so that the Members will know——

    Mr. LAHOOD. Thank you, Mr. Chairman.

    Mr. DUNCAN [continuing]. Which is which.

    Ms. MCFADDEN. I am Nancy McFadden. I am the General Counsel for the Department of Transportation.

    Ms. GILLIGAN. Peggy Gilligan, deputy associate administrator for regulations and certification, FAA.

    Mr. OBERSTAR. There were allegations made about a—in the chairman's words—''a political meeting in the White House.'' I'm not quite sure what those words mean, but their implication perhaps is clear.

    I would like you to describe for us in chronological sequence the initiation of and carrying out of the meeting at the White House on the subject of ValuJet.

    Ms. MCFADDEN. Congressman, I think that the FAA administrator did a good job of describing the purpose of the meeting and what occurred at the White House meeting. The piece that he did not impart to the committee and was not aware of is how that meeting was initiated, so let me—and thank you for the opportunity to make that point clear.
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    As with any major announcement from any Cabinet agency, one of the things that a Cabinet Secretary has an obligation to do is to inform not only the White House but also appropriate Members of Congress.

    Once the FAA administrator made the decision with respect to ValuJet and made the decision that that decision was going to be announced to the general public at some point on Monday, the 17th, the Secretary's chief of staff notified the Cabinet Secretary at the White House that an announcement was going to be made.

    Mr. OBERSTAR. An announcement about——

    Ms. MCFADDEN. About ValuJet was going to be made.

    Mr. OBERSTAR. Yes.

    Ms. MCFADDEN. And I think that was really the essence of the communication at that point. That was some time around the time when Mr. Hinson came over to brief the Secretary about the substance of the decision.

    The Cabinet Secretary——

    Mr. OBERSTAR. Who is that person?

    Ms. MCFADDEN. Kitty Higgins is the Cabinet Secretary, sir. The Cabinet Secretary, recognizing that this is clearly something that has been getting a lot of attention in the last 5 weeks, thought that the chief of staff, Mr. Panetta, would want a little bit more briefing than just ''an announcement was going to be made with respect to ValuJet,'' and asked that the Secretary and the FAA administrator brief the chief of staff with respect to the decision that was going to be announced some time that day.
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    Mr. OBERSTAR. And from the standpoint of Ms. Higgins, that was a request for information?

    Ms. MCFADDEN. For information only. It was a briefing about what the substance of an announcement that was going to be made at some point that day or that evening.

    It so happened that, with respect to the chief of staff's schedule, that about 1:30 in the afternoon was really the only time that he had available. The administrator's briefing of the Secretary was concluding, and so that is why the meeting immediately succeeded the briefing of the Secretary. That was the only time that Mr. Panetta had available.

    Mr. OBERSTAR. At that point was the—was either Ms. Higgins or Mr. Panetta aware of the substance of the action to be taken on ValuJet, prior to the actual briefing?

    Ms. MCFADDEN. I don't believe so, sir.

    Mr. OBERSTAR. And did you make it clear that this briefing would be about an independent regulatory decision?

    Ms. MCFADDEN. Yes. In fact, once the Cabinet Secretary posed that request for such a briefing, the DOT chief of staff asked me, as the General Counsel for the Department, to give her and the Cabinet Secretary a judgment on the appropriateness of such a briefing.
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    Given the timeframe of the public announcement, and given the fact that the decision had been made, and given the fact that both the White House and the Department of Transportation and the FAA recognized that this was an informational briefing only, it was my judgment that it was entirely appropriate that not only the White House be informed but, as I said, that appropriate Members of Congress be informed in advance of a press announcement.

    Mr. OBERSTAR. And were you aware, at the time of arranging the meeting, that it was likely that concurrently with that meeting there might be an announcement or, if not an announcement, an action taken by the Atlanta FSDO to enter into the consent decree with ValuJet?

    Ms. MCFADDEN. We were quite aware. It was made very clear to the Secretary that, as we were going to the White House to brief them on the decision that had been made, the inspectors and lawyers in Atlanta were going to be meeting simultaneously with ValuJet to discuss the decision that had been made that morning.

    Mr. OBERSTAR. And did the FAA legal counsel staff, general counsel staff at FAA, know that a decision would be made about grounding ValuJet before the meeting would be taking place at the White House?

    Ms. MCFADDEN. I'm sorry. I don't think I understood your question. Did the FAA chief counsel——

    Mr. OBERSTAR. Did the FAA legal counsel staff, chief counsel staff, know that it was likely that the flight standards district office would enter into this consent decree to ground ValuJet prior to your meeting with the White House?
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    Ms. MCFADDEN. I believe that they knew that their lawyers in Atlanta were meeting with ValuJet at the same time. Yes.

    Mr. OBERSTAR. All right. The lawyers in Atlanta, not necessarily the staff at FAA headquarters in Washington?

    Ms. MCFADDEN. Yes.

    Mr. OBERSTAR. Right. What time did your meeting begin with the White House staff?

    Ms. MCFADDEN. Mr. Oberstar, as I recall, the meeting was set for about 1:30. I think it began a little bit late, some time between 1:30 and 2, I think, as the Administrator said.

    Mr. OBERSTAR. And how long did it last?

    Ms. MCFADDEN. My recollection is that it was probably about 40 minutes.

    Mr. OBERSTAR. And what time was the decision made or the agreement reached—however you want to characterize it—between FAA and ValuJet in the Atlanta FSDO?

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    Ms. MCFADDEN. I'm not sure. Mr. Broderick might have a better idea—at some point that afternoon the decision was reached by ValuJet that it was going to agree to a consent agreement rather than unilateral FAA action.

    Mr. OBERSTAR. What time did that meeting start, if you know?

    Mr. BRODERICK. It's my recollection, Mr. Oberstar, that that meeting started between the folks in Atlanta—it was scheduled for, I think, about 1:30, 1 or 1:30, and it started late. It was a very brief meeting, less than a half an hour, and it's my recollection that they were out of that meeting certainly by 2 or 2:30, or something like that, while ValuJet decided what it was going to do.

    So if I'm not mistaken, that's the time.

    Peg Gilligan may have a better recollection.

    Ms. GILLIGAN. I actually had conversations with the manager in the southern region around 11:30—between 11:30 and 12:00—to say, ''Go ahead and set up your meetings now with ValuJet. We've briefed the administrator. We've briefed the Secretary. Begin the process.'' They tried to schedule that meeting for between 1 and 1:30. It actually started between 1:30 and 2.

    Mr. OBERSTAR. If this were nuclear warfare, you would say that the missiles had been irretrievably launched on ValuJet?

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    Ms. GILLIGAN. Yes, sir. I think that's an accurate description.

    Mr. OBERSTAR. Who participated, Ms. McFadden, in the meeting at the White House?

    Ms. MCFADDEN. I think the FAA Administrator was correct in naming the chief of staff, Mr. Panetta, Mr. Stephanopoulos, the Secretary, the Administrator, and myself, Ms. Higgins, the Cabinet Secretary, and I believe the deputy chief of staff, Ms. Lieberman, was also there.

    Mr. OBERSTAR. Did any of the White House staff, after Mr. Hinson made a presentation, did any of the White House staff have any comment about the substance of the decision?

    Ms. MCFADDEN. Not at all.

    Mr. OBERSTAR. Did you have any comment about the timing of the decision?

    Ms. MCFADDEN. I do remember that they expressed—that there was an expression of concern that if the decision had been made, that it should be executed and announced as quickly as possible.

    Mr. OBERSTAR. Did anyone, any member of the White House staff, attempt to dissuade Mr. Hinson, you, or any other member of the Department, from making that decision?
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    Think about it. You're under oath.

    Ms. MCFADDEN. No, sir.

    Mr. OBERSTAR. Was there any comment about moving expeditiously or taking any action in any other manner than that which had been decided upon already by the Atlanta FSDO?

    Ms. MCFADDEN. Not that I recall, sir. No.

    Mr. OBERSTAR. Mr. Hinson, do you have any different recollections from the statements and the responses of Ms. McFadden?

    Mr. HINSON. Only, Mr. Oberstar, that there was one additional gentleman at the meeting. His first name is John. I apologize. I don't know his last name.

    Mr. OBERSTAR. John Angel, I suspect.

    Mr. HINSON. Could be. Yes.

    Mr. OBERSTAR. He's the—Mr. Panetta's counsel.

    Mr. HINSON. Yes, sir.

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    Mr. OBERSTAR. And was his counsel on the committee when he served on that.

    Mr. HINSON. That's all, sir.

    Mr. OBERSTAR. So the—actually, the decision about ValuJet was, in effect, made—was—correct that. The decision about ValuJet had been made by technical people on the ground in the Atlanta FSDO prior to the meeting at the White House. There was no attempt by White House staff to influence that decision, change its outcome, or change its timing; is that correct?

    Mr. HINSON. Who are you addressing?

    Mr. OBERSTAR. You, Mr. Hinson.

    Mr. HINSON. That is correct.

    Mr. OBERSTAR. Ms. McFadden.

    Ms. MCFADDEN. That's correct, sir.

    Mr. OBERSTAR. Mr. Gilligan.

    Ms. GILLIGAN. That's correct. As far as I know, those facts are right.
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    Mr. OBERSTAR. Mr. Broderick?

    Mr. BRODERICK. As far as I know that's correct, sir.

    Mr. OBERSTAR. I think that's sufficient on that subject.

    I want to pursue another matter, and that is the issue of the February 14 report on ValuJet entitled ''ValuJet VJA 465W, Atlanta, Georgia, February 14, 1996, Report Prepared by AFS 300.'' It was prepared by Mr. Frederick Leonelli, manager of the Flight Standards Maintenance Policy Office. Is that correct?

    Mr. BRODERICK. Yes. Flight Standards Maintenance Division, sir.

    Mr. OBERSTAR. In this report, Mr. Leonelli gathered together available information contained in reports prepared and emanating from the flight standards district office in Atlanta that reached the FAA headquarters office here, and came to these conclusions:

    The PTRS—and that, as I understand it, is ''Program Trouble Reporting Systems,'' a computer reporting system, is that correct?

    Mr. BRODERICK. Yes. Program Tracking and Reporting System. Yes, sir.

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    Mr. OBERSTAR. Data analysis revealed that some critical surveillance activities did not receive much attention. The data reviewed clearly show some weakness in the FAA's surveillance, referring to ValuJet.

    I won't go through all the rest of them, but I want to read this one recommendation: ''Consideration should be given to an immediate FAR–121 recertification of this airline. This recommendation is based on such known safety-related issues as the absence of adequate policies and procedures for the maintenance personnel to follow. Additionally, the absence of engine trend monitoring data and the possibility of a continuous airworthiness maintenance program that may be inadequate because it uses reliability-based procedures without a reliability program.'' I must say that if I had received that document, whether in my capacity or in your capacity, I would have been agitated. I said earlier I would have hit the roof.

    Why did this not get to your desk in timely fashion?

    Mr. BRODERICK. I don't know, because, had it gotten to my desk, I would have—I think I would have had a similar reaction.

    I have asked Mr. Leonelli, who is the manager of the organization that prepared that report, what he did with it. His recollection is that he passed it to his immediate supervisor, the Deputy Director of Flight Standards. On the other hand, Mr. White, the Deputy Director of Flight Standards, does not recall that happening.

    In any case, what we do have is agreement that the action launched on February 16 by the people in Atlanta, which is the day that they announced their special emphasis inspection that would have intense inspections at the end of February and continue for nearly 4 months, those actions fully satisfied the intent of all the recommendations in the report.
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    So it's my belief that, even though they didn't realize—some may not have realized—that the report never got to Atlanta, the actions that were taken—and in a post hoc review just in the last few weeks this has been confirmed—the actions that were taken quite independently by the people in Atlanta satisfied all of the concerns that they had.

    Mr. OBERSTAR. Mr. Hinson, you did not see this report either at that time, or within a few days after its issuance?

    Mr. HINSON. That's correct.

    Mr. OBERSTAR. If you had received this report, with the recommendations that I've begun to enumerate and the backup for them, do you think that you would have felt that a special emphasis inspection would have been a sufficient response?

    Mr. HINSON. Well, I would have first had to have asked Mr. Broderick or his staff what is entailed in a special emphasis inspection so that I would understand what constitutes what they proposed to do.

    But, based upon what I know now about a special emphasis inspection, the answer is yes. The special emphasis inspection did satisfy the concerns of a author of the memo.

    Mr. OBERSTAR. You would not have gone to the extent recommended, to order recertification of the carrier?

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    Mr. HINSON. Well, first of all, not to be particularly—I don't want to split hairs here, so to speak, but that's not what it says. It says, ''Consideration should be given.'' It does not say emphatically or declaratively we should ground the airline or recertify it. It says we should consider it. That's No. 1.

    No. 2, this is a staff organization, not a line organization. The responsibility for the airworthiness and compliance of the airline resides at the flight standards office in Atlanta, and only there.

    If the staff prepares a memo that raises concerns and brings it to the attention of their appropriate management, they, in turn, go back down the line and say to the line, direct relationship, ''What do you think about this? Do you agree or disagree? What should we do, in any case?'' That also, just while I'm speaking about this issue, brings focus on an issue that I have, which is: when we do internal documents where concerns are raised by staff members, how do we make sure that those concerns are raised to a appropriate level and not left laying on a desk or put in a drawer unattended?

    I have asked my Deputy, Linda Daschle, to do a number of things over the next 90 days in a special report to me, and one of the issues I've asked her to look at is to review how our internal processes work for moving data around within the AVR organization.

    About a year and a half ago I instituted a new program where the senior managers of the agency meet quarterly to discuss, in a body, the major safety issues facing the agency. That was also part of this whole idea of making sure that we don't overlook some issue.

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    It was in that context. That's sort of a long answer, but I think an important answer.

    Mr. OBERSTAR. Well, I'm concerned about that process, about the way information gets to decisionmakers within the agency. This is not new. This is a longstanding issue. It goes way back to the 1980's when there was a different structure at FAA—regional administrators, where decisions were made in the region and didn't make their way to the Administrator or to the top personnel in the agency with ultimate responsibility, such as the over-wing exit issue that we've dealt with very effectively and successfully.

    But you still have that problem. What concerns me, if you had not initiated the most intensive inspection ever conducted on an airline after that accident, and the FAA had led a more routine space of special emphasis inspection play itself out, ValuJet likely would be flying unsafely today, and that bespeaks a shortcoming in the inspection program in the way information gets from those with line responsibility to those with staff responsibility and those with management responsibility.

    That is something, it seems to me, that needs to be addressed, and decisively.

    Mr. HINSON. I agree, sir.

    Mr. OBERSTAR. In the wake of the immediate aftermath of the ValuJet accident, you and the Secretary both made statements, ''The airline was safe.'' When questioned, you have said that you made those statements and the Secretary made those statements based on information you knew at the time, and that it was appropriate at the time.
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    Appearance is given that the airline really was not at the highest level of safety, you just didn't know it. And the public flew in jeopardy for a period of time. That at least is an appearance.

    I'd like to give you an opportunity the respond to that.

    Mr. HINSON. You raise a very interesting point and one that I have thought about, obviously, a lot since I made that statement on the 12th when I was in Miami with the Secretary.

    I want to first point out that the Secretary made his statement based upon information that I and others in the FAA gave him, so I want to say for everybody that the Secretary relied upon data that was given to him by me and my fellow FAA employees, and that should be understood.

    But, having said that, you are addressing a problem that is—I don't want to make it too academic, Mr. Oberstar, but it is a logic problem, and it flows something like this: when an airline is compliant and it moves to non-compliance—and, based upon the data that we had that Sunday, the airline was compliant. We had no reason to believe that the airline was not compliant in terms of Federal Aviation Regulations.

    We can debate—and there are some who believe that the information we had prior to that was adequate to ground the airline, and I will tell you that our inspectors, who are real professionals, do not believe that to be the case.
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    Now, when an airline migrates from being compliant to non-compliant, how does that work? Last year, as you mentioned, we did ground five airlines—or someone mentioned. If you had asked me about any of those airlines a week before, 2 weeks before, a month before, 6 months before, my statement would have been something like this: ''The airline has complied. Airline A has complied. Airline B has complied, and so forth, and yes, they're safe.'' Yet, somewhere in that timeframe, because of inspector insights and investigations, or for a host of other reasons, that airline migrated from being compliant to non-compliant and was asked to stop flying, or parts of the airline were asked to stop flying.

    Technically and logically you could say, ''Well, if it's true that you made an airline non-compliant on this day, and it's the result of something that occurred before that, are they unsafe or non-compliant all the way back through that period of time?'' Perhaps. At what point do you find out that they're non-compliant and then ground them? That is a logic problem that has caused the FAA lots of heartburn over many, many years.

    Mr. OBERSTAR. Mr. Hinson, I'm sorry to interrupt.

    Mr. HINSON. That's all right. I just wanted to——

    Mr. OBERSTAR. In all fairness, we have an agreed-upon time sharing here, and I think you've responded to the question. It will require more in-depth inquiry at subsequent hearings to sufficiently plumb that issue, and I thank you for your response.

    I thank you, Mr. Chairman.
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    Mr. DUNCAN. Well, thank you very much, Mr. Oberstar.

    Ms. McFadden and Ms. Gilligan, thank you for your testimony.

    I'm going to ask Ms. Schiavo and Mr. Hall to come back to the table, please, and we will start moving from Member to Member for questions. Let me just start.

    Mr. Hinson, I'm interested in where we have been, but I'm also interested in where we are now. You know the day after the decision was made to ground ValuJet, I asked you two questions. The first was I asked you was it your goal to get ValuJet back up and flying as soon as possible, or was what you had discovered so terrible that you felt they should be grounded permanently.

    Would you tell me where you stand or what your answer to that question would be today?

    Mr. HINSON. Yes. My answer is the same as I gave you, Mr. Chairman, as I recall it, which is: when ValuJet complies with the terms of the consent order and is in compliance with the appropriate Federal Aviation Regulations, they may fly.

    Mr. DUNCAN. And do you think that that—do you have any kind of timeframe in which that can be done?

    Mr. HINSON. I do not, sir. No.
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    Mr. DUNCAN. Second, I asked you at that time: did you think that ValuJet would tell me at some point that no airline could withstand that kind of scrutiny that you have stated publicly that you had—or the FAA had put them through 4 years of inspections in 4 weeks of time. I'll ask you that again, sir.

    There is a quote or there was a column in one of the—I think in the ''Wall Street Journal.'' It said, ''Aviation is like any business. The sausage factory metaphor applies. If you could see what really goes on, it's not post card perfect. Yet, the industry's safety record speaks for itself.'' How do you respond to that?

    Mr. HINSON. With respect to your first question, if we did 4 years of inspection in 4 weeks on any air carrier we would find things. We would find a number of things.

    The question would be—and I wouldn't speculate on it—to what degree, and would it be serious enough to cause the airline to lose their compliance with respect to Federal Aviation Regulations.

    It is also true that airlines are human enterprises and the machinery is built by humans, and it has, therefore, the typical foibles that we all have.

    What we have tried to do over a long period of time, Mr. Chairman—this is not a year's process, but a 50-or 60-or 70-year process—is: understand why and how airplanes work; try to design them so they are redundant and we have more than one system, both in the air and on the ground; train our people to the highest quality and professionalism that we can; and try to keep those standards as high as possible.
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    I think the long-term safety record would suggest that the whole industry, including the Federal Government, not just the FAA, but all of the research and development that is attendant to the industry, has been rather successful.

    Mr. DUNCAN. In that regard, I would like to re-emphasize some statistics that you ran over quickly at the first of your testimony.

    I believe you said that before deregulation there was one accident for every 860,000 departures, and today it is one accident for every 1.7 million. Is that correct?

    Mr. HINSON. It is fatal accidents per 1.82 million departures.

    Mr. DUNCAN. So 1.82 million?

    Mr. HINSON. Yes, sir.

    Mr. DUNCAN. Let me ask you this: I know you deeply regret this accident, as all of us do. Do you think that the FAA allowed ValuJet to grow too quickly?

    Mr. HINSON. Yes, sir, in retrospect I do. And it's not a question of how fast they can grow. They can grow even faster than this, or what they had grown in the past, I should say.

    The growth rate is really dependent upon an air carrier's ability to have an infrastructure and systems management in place that allows them to accept the growth rate they choose to have, if I can say that. That's fairly straightforward, I think.
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    So where I think the FAA could have done a better job is probably a year ago in April when they were flying, I think, about 25 airplanes and they grew to 50 by February, 51 when we asked them to stop growing. It's in that timeframe that we might have done a better job of saying to them, ''Why don't you slow down. Your systems may not be quite capable of helping you manage your growth.'' And there are some lessons learned there for us.

    Mr. DUNCAN. A few days ago in the ''Christian Science Monitor'' a man named Morton Beyer was quoted as saying, ''I have never seen a single incident where an FAA inspection discovered or prevented a threatening situation.'' And then he went on to say, ''Most of the day-to-day inspection is nothing but a paper chase.'' I believe, Mr. Hinson, and I have said publicly many times I have great respect for you and the job you've done, but I will tell you that the day before I read this, that I had a man who heads up a very successful aviation company—not one of the airlines—but he said to me in my office, ''The FAA does not inspect airplanes, it inspects paper.'' What is your response to this aviation consultant who is quoted in the ''Christian Science Monitor'' and to this gentleman who I quoted?

    Mr. HINSON. Well, Mr. Chairman, I started flying commercially after my Navy flying in 1959, and I've been flying commercially in various phases ever since. I have been the recipient of many FAA inspections, check rides. In fact, I have given personally over 1,000 flight checks and numerous line checks. I've started an air carrier. I started a general aviation service corporation. I've had to be approved by the FAA. I've been involved with the agency as a user and customer for many more years than I've been the Administrator.

    It is true that the FAA inspects paperwork. That is an important part of their job. But it is also true—and I will tell you from personal experience—I have seen FAA inspectors all over airplanes, giving flight checks, doing walk-arounds, and inspecting fuel dumps, parts bins for compliance.
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    There is so much to be done by 2,600 or 2,700 people in the sort of global scheme of things that the FAA does have to depend upon paperwork to a great deal and industry compliance, but it is not true, as Mr. Beyer suggested, all that the FAA inspections do is paperwork. That is simply not true.

    Mr. DUNCAN. On one other topic—and I certainly have no objection to changing the FAA mandate in some respects to one of safety only, but I've been a little bit skeptical of that as being—well, as Ms. Schiavo, she called it a simple word fix.

    Do you think that that is a real problem in the FAA? I have felt really that if you promote something, that if we all work to make the aviation industry more successful, that they then can buy better and newer equipment and they become safer in that way.

    But will that solve the problem? Because if it is that something that simple, then boy we need to do it. I'm wondering what your reaction to that is.

    Mr. HINSON. I think the Secretary's view—and I'll presume to speak for him here—is that we need to remove the ambiguity of that part of the act last written, I believe, in 1967 when the FAA became part of DOT, which would cause the public to have any concerns about what is the mission of the FAA.

    You are suggesting, sir, that we need to do all of the things that the act addresses, and I certainly agree with that. But I also agree with the Secretary, probably with the IG, and with others who have voiced their opinions, that we need to remove any ambiguity about what our principal job is.
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    Mr. DUNCAN. I've got one last question, and then I'm going to move on.

    Ms. Schiavo, the FAA is a huge bureaucracy—I think 48,000-plus employees. Even in a small bureaucracy or in a small office you always have a certain percentage of people who are unhappy at any particular moment. I'm wondering, ma'am, do you—you talk about 40 people contacting you, or 40 inspectors—no, I believe that was Senator Cohen, but you talked about some of these people contacting you.

    I'm wondering if—and I'm really not trying to lead you here, because I really wonder about this. Are we being contacted by some of the malcontents, the unhappy people, or do the people that you—have you contacted those who are happy with the agency and asked them, and do they say some of these same problems exist?

    Ms. SCHIAVO. Well, I can not answer whether the people contact me are just malcontents or speak for the whole agency, and I am sure we can not debate that without revealing them, which I am not going to do. I can only say that, for example, in recent months when folks have contacted me—and particularly some who have called me at home—provided information, and the data turned out to be true.

    So we just take the information and data as we find it, but in these cases they were quite reliable.

    Mr. DUNCAN. All right. Thank you very much.
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    Mr. Lipinski has asked that I go next to Mr. Costello.

    Mr. COSTELLO. Mr. Chairman, thank you very much.

    Mr. Hinson, I wonder if you might, for the benefit of the members of this committee and those in attendance here, give us a little run-down as to what procedure the FAA follows to monitor the quality of maintenance that is performed by subcontractors. We have read, of course, that ValuJet, because of their growth, they have taken on somewhere in the neighborhood of two or three new subcontractors every month for the purposes of training their employees and maintaining their equipment.

    I wonder if you might just tell us a little bit about how you ensure that the quality of the subcontractors, that they actually are doing their jobs and performing the maintenance.

    Also, you announced by a press release in the last week or so that those procedures are going to change, to make sure that the inspections or the quality of the work performed by subcontractors—that the FAA will have a better handle on that.

    So tell us what you currently do and what you intend to change in order to make sure that the quality improves.

    Mr. HINSON. Mr. Costello, thank you for your question. With your permission, I will ask Mr. Broderick to help me with this. I can give you—I could give you a broad overview, but, in the interest of time and more specifics and making sure you get the correct answer, I'll ask Mr. Broderick, if I may.
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    Mr. BRODERICK. Yes, sir. Fundamentally, the FAA certificates, in accordance with our regulations, the repair stations to perform certain kinds of work. They have certain kinds of ratings, they are called.

    Airlines are only permitted to use repair stations for contract work that have the appropriate rating for the work, and, in addition, the airline must submit the airline maintenance program relevant to the work that is being done with all the work cards and things to the repair station, who must carry out that work in accordance with the airline's program.

    The airline is not absolving itself in any way of responsibility for the quality of that work.

    Our oversight has fundamentally focused in this area in two unconnected area, as a general rule—a rule that's going to be changed.

    The first is to make sure that the airlines are only contracting with repair stations with appropriate ratings to do that work. The second is to do surveillance of the repair station to make sure that the work it performs, which may be for many airlines or other companies, is being done in accordance with the regulations that are appropriate to that work.

    But there has not been, until the decision was made recently, a specific program in which the airline maintenance inspectors link up with the repair station's maintenance inspectors, who may be 1,000 or 2,000 miles away, to make sure that the repair station maintenance inspectors see what is going on for their airline and are inspecting on a spot-check basis the work being done for that airline by the repair station to be in conformance with the airline maintenance program.
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    Similarly, turn it around: the repair station inspectors doing their routine surveillance of repair stations will be required to be much more alert to the work that is going on for airlines, make sure that the airline principal inspectors for maintenance are aware of it and are satisfied that the work is properly being done.

    In order to do this, we are sort of elevating the visibility of contracted repair work.

    Right now the airline is required to list all of its vendors in its repair manual for the use of the company people. We are elevating that listing to the operations specifications, which are a contract between the FAA and the airline operator, and requiring an audit of all of the past approved vendors for that airline to have a demonstration that the people that are being used are, in fact, fully qualified to do the work and have the appropriate maintenance instructions from the airline in the repair station.

    Then, prospectively, airlines will be required to modify their operation specifications, which is a joint signature document of the FAA and the airline, to add new repair stations to the maintenance list.

    So it's really—we're not changing the rules. What we're doing is elevating the emphasis on proper coordination of repairs.

    Mr. COSTELLO. The Inspector General testified that, of course, her office makes recommendations to the FAA, as does the NTSB and the GAO and many other agencies.
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    According to some information that I have, the FAA accepts 80 percent or more of the recommendations submitted to the FAA by the NTSB and the GAO. I just wonder, Mr. Hinson, you mentioned earlier about the high percentage of recommendations coming from the Inspector General to the agency are implemented. Is it a similar number, 80 percent or more?

    Mr. HINSON. I don't know the answer to that, but I'll be happy to get it for you. I don't know specifically and I wouldn't want to guess at it, but it is a high percentage.

    [The information received follows:]

    FAA accepts approximately 80 percent of the recommendations made by the DOT Office of Inspector General (OIG) which are implemented in accordance with a schedule provided by the FAA. For the other roughly 20 percent, FAA either partially concurs or nonconcurs. For most of these FAA ''negotiates'' with the OIG informally and reaches some agreement on findings and recommendations which are then implemented. On the few recommendations where FAA and the OIG cannot agree, a Departmental Audit Resolution process has been established and a final decision is made by a top DOT official.

    Mr. COSTELLO. The safety violations are maintenance violations of airlines that are discovered by the FAA through routine inspections. Are they made public in any way?

    Mr. HINSON. Well, there are maintenance reliability reports and other things that are published within the industry, but they probably don't get wide circulation. But the FAA has no—I'm not aware—and I'll ask Mr. Broderick—I'm not aware of any public document that we issue, release, or publish that has any specific air carrier-related service difficulties or other issues.
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    Mr. COSTELLO. Is that something you would like to see changed if, in fact, that is the case?

    Mr. HINSON. You know, this debate has occurred before, Mr. Costello, in previous Congresses and in previous aviation safety forums for the past 20 or 30 years. It is a fairly complex and complicated issue and has some legal aspects to it, as well. So I can't tell you whether I think it's a good idea or not, frankly.

    Mr. COSTELLO. I see the light is on, but let me ask a final question.

    You mentioned earlier, in response to a question by Chairman Duncan, that maybe the FAA could have done more as far as the growth of ValuJet. I wonder, from a legal standpoint, what the FAA could have done to slow down the growth of ValuJet or any new airline growing.

    There are some things that obviously the FAA can recommend, but I think there are some legal restrictions, and you might want to expand on it.

    Mr. HINSON. I want to say first the FAA has no intention, and it would be improper for us to in any way impinge upon the economic decisions of an air carrier or any other aviation organization. That's not our job.

    But our job is this: that if they want to grow or enter into some new business or in any other way change their business and there are regulatory implications to that decision, then we have an obligation to sit down with them and counsel them and say, ''We think—'' let's take the case of ValuJet specifically—''that your maintenance systems, as they are constituted, can accept one new airplane a month, two new airplanes a month, no new airplanes a month—'' whatever our safety oversight people might conclude.
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    It is in that context—I have to tell you, though, in—I'm a little bit hesitant because I don't want to try to mitigate our responsibilities early in the issue of growth of ValuJet, but in my entire airline experience, which is a long experience, I have never seen or been involved in an airline that grew this—a passenger airline that grew this fast. They are truly one of a kind in this context, and so we did learn some lessons.

    Mr. DUNCAN. Thank you, Mr. Costello.

    Mr. Kim?

    Mr. KIM. Thank you, Mr. Chairman.

    I do have one simple question to Mr. Broderick. I'm sorry to hear that this is your last day.

    Mr. BRODERICK. Thank you, sir. It's actually Friday that will be my last day.

    Mr. KIM. How long have you been within FAA?

    Mr. BRODERICK. Just a little over 20 years, sir, 25 in the Government.

    Mr. KIM. Oh, my God, I really feel bad.
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    The last 1 year alone, without going back three or 4 years, I have a copy here of roughly 28 separate violations, which vary from simple procedural non-compliance to some serious mechanical defaults. Mr. Chairman, I'd like to ask unanimous consent to submit these 28 violations as an official document.

    Thank you.

    [The information received follows:]

    [Insert here.]

    Mr. KIM. And then if you go back, 1995, there is 58 violations and 43 of them are maintenance oriented. Then go back to 1994, October, there's 35 violations of which 20 are most serious, category A violations. But during the same period of time, ValuJet was allowed to grow from 2 airplanes to 50 airplanes, as Mr. Hinson mentioned. If you look at that as a percentage, we're talking about 2,500 percent increase during that short period of time.

    Now, I remember watching TV, our Inspector General said she doesn't want to fly ValuJet, because they're not safe, the next day Mr. Peña says, ValuJet is fine airline company, all the problems have been mitigated, I'll fly any time. And then weeks later, grounded.

    Now, did FAA shut down ValuJet after learning of any serious, any additional information or any substantial information that you were unaware of? Would you answer that, please?
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    Mr. BRODERICK. Yes, Mr. Kim, we put a team of about 60 inspectors together for a month to look intensely at ValuJet after the accident. This was quite an intense inspection. I mean, if you compare it to an airline like American Airlines with 640 airplanes, you're talking about the equivalent of 700 inspectors.

    There were an awful lot of discrepancies found, as one might imagine, some small, some more serious. And it was the analysis of this data at just some few days ago now, a little over a week ago, week and a half ago, that led the inspectors to conclude in Atlanta that they had found some systemic problems, in addition to a number of discrepancies that were unconnected. That is the process that we went through.

    Mr. KIM. Well, then obviously, you gave a public impression that ValuJet was growing so fast, obviously they had been complying with all the violations, otherwise they wouldn't have grown that fast.

    Let me ask a question to Ms. Schiavo. Do you believe the ValuJet crash was preventable, if the FAA had handled the situation differently maybe, or worked with you closely, or followed your recommendations? Was that preventable, in your opinion?

    Ms. SCHIAVO. We have to wait until the NTSB cause of the accident comes out. I think what was preventable is there were a great number of things known about ValuJet, which is why I started questioning them, and after the accident report comes out, will some of those be shown to be something we could have prevented, depending on the cause? Unfortunately, yes. Most accidents are preventable. Planes do not fall out of the sky unless something is wrong. And they are almost always preventable.
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    Mr. KIM. Thank you. Thank you, Mr. Chairman.

    Mr. DUNCAN. Thank you, Mr. Kim.

    Mr. Traficant?

    Mr. TRAFICANT. I have a number of questions, I really don't want your answer here. I want you to detail them in writing and submit them to the committee. I've heard more oaths in Elton John songs.

    To Ms. Schiavo, did you submit your safety concerns in detailed writing to the FAA, send copies and documents of every safety concern you had about ValuJet, did you submit it in writing? No. 2, there's been some word that a number of employees in your office expressed concern about how you conducted some of these investigations and your office pursued some of these investigations. I'd like to know the nature of those concerns expressed, if there's any documentation of them, to who they were expressed, and what was done in response to those particular concerns.

    Mr. Hall, did the oxygen generators cause this crash? If they did, other than the human error, what could ValuJet have done? If the Florida crash had not occurred, would we be here today about ValuJet?

    Mr. Hinson, I think you've taken a lot of heat. Quite frankly, I think it's refreshing to see somebody who's taken the heat come here like you have. Not everybody does so with such dignity and courage. There's a lot of people after you. I particularly have some confidence in you, on the way you handled this.
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    What I would like to know specifically is, the reporting after this was over, because DC doesn't stand for the District of Columbia, it stands for damage control any more down here, there are some people saying dangerous, some people saying safe, and my concern is, how do we respond to these types of issues and whom can the American people believe when they hear their Government speak? I don't know if that's a form of a question for you, because I don't think that you're going to have to be the guy who's going to make some of these decisions. I think there's a lot of politics going around, and I hope you survive, personally, because I think you have the heart and the courage to do the job.

    But I just want to know where the politics end and where the American people could believe what they hear from the FAA, not political agendas from people from within, not from rumors, not from individuals who may not like each other. And I am saddened to see Mr. Broderick leaving. I think there are a couple of employees, after looking at this matter, that were very negligent and allowed a very volatile substance to create a fire that probably downed the plane, and everybody's choosing their words about it.

    Now, if that's what happened, the people who allowed that to happen created a great, great tragedy. If there's other things that would have brought ValuJet here, tell us, tell us in writing, Mr. Hall. Tell us in writing what reports you submitted, Ms. Schiavo, how you did them, and why in God's name we've got to hear spin control from every side of the Capitol whenever there's an accident.

    Actually, I agree with Chairman Shuster, we have a very safe aviation industry. But for every accident, there is an answer. This one may be human error. And if it is, let's tell it like it is, because we have started to develop sacrificial lambs around here, starting with Mr. Broderick. And that isn't the type of Government I think that Thomas Jefferson would have supported.
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    So with that, if you understand my questions, and if the staff has taken note of my questions, I want those questions answered in detail and spread upon the record.

    I yield back my time.

    [Responses to questions sent by Rep. Traficant to Ms. Schiavo follow:]

    [Insert here.]

    Mr. DUNCAN. Thank you very much, Mr. Traficant. And we will make sure that those questions are answered in writing and placed in the record.

    Mr. Ehlers.

    Mr. EHLERS. Thank you, Mr. Chairman.

    First of all, to everyone on the panel, I appreciate your coming here. This is precipitated by a very tragic event, and none of us really enjoy this process that much. I suspect especially you, Mr. Hinson, have not enjoyed any of this, or any of the events of the last 5 weeks.

    I do want to say, in somewhat agreement with Mr. Traficant, the gentleman from Ohio, that I've always had the greatest respect for your ability and admired what you tried to do at the FAA. I think it's particularly noteworthy that you've at least stayed with the FAA for a longer time than most of your predecessors, and I think therein may lie a great deal of the problem that the FAA has had in the past. And if you do stay around longer, I hope you're able to straighten some of this out.
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    Much has been said already, and I will try not to repeat it. But there's one point I did not hear much discussion of, although it may have happened while I stepped out briefly for another meeting. But I am really somewhat surprised, dismayed and disturbed about the attention given to this particular accident, compared to many others. Accidents are always tragic, they always draw attention.

    As I pointed out in the hearing last week, the same day that the DC–9 crashed, just as many people were killed in automobile accidents. And that goes on day after day after day.

    This Congress voted for a change in the law this year, which is going to result, by conservative estimates, in probably 2,000 to 3,000 additional highway deaths per year, that's increasing the speed limit. That's equivalent to one ValuJet crash every other week. That created a few column inches in the paper.

    And I don't understand the media feeding frenzy on things like this, I think it blows it all out of proportion and makes it very difficult for us to deal with it, as Chairman Shuster promised we would, carefully, thoughtfully and rationally. But the amount of media space devoted to this is inordinate, much of it over-exaggerating situations, it's made it very difficult for you, it's made it very difficult for the airline. And I simply wanted to make that statement and get that on the record.

    I think it's a gross mistake, it makes it appear when flying is not safe, when in fact it is the safest form of transportation by far. And I commend not only the FAA, but particularly the Transportation Safety Board for the tremendous efforts over the past years. That chart we have up there, which most of the audience can't see, is startling in the number of deaths, and the accident rate has gone down over the past 50 years.
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    So I think we have a very, very safe industry and a very, very safe record, and we shouldn't let the recent events obscure that. It's very important for us to recognize that and point that out.

    I think there's a lot to be learned from this particular incident. One issue that has emerged, as one pointed out, how do we deal with rapidly growing airlines. I'm more concerned, however, about the contract maintenance. It appears to me that's a major part of the problem. Incidentally, it appears to me that's not related to the accident in any way, the best information we have.

    And that again leads me to this great surprise at the media feeding frenzy about ValuJet's record. Because it's hard to establish at this point that what happened was their fault. And clearly, the so-called hazardous cargo, perhaps the oxygen generators should not be allowed, but the airline in good faith took a shipment that said it was safe, that it was not hazardous.

    But your look at the records, and I appreciate the IG's comments on this, too. What disturbs me about all of this is that there is a pattern that was developing and no one was looking at the pattern. And you have to have some mechanism in place to recognize the danger signals as that pattern develops. It doesn't matter whether it's a fast growing airline, it doesn't matter whether it's contract maintenance. There are going to be other things that emerge in the future, and I'm sure the Inspector General can testify to events in the past and perhaps make some predictions about the future.

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    Someone has to be looking at the patterns that are developing and someone has to make sure that as these patterns, these problems are observed, and the patterns of problems are observed, that that gets fed all the way up the ladder. So it seems to me there are two failures in the agency, the FAA. And one is the failure to discern the pattern, second the failure to have that communicated up the ladder.

    I would appreciate your comments on that, Mr. Hinson, as to whether you believe that's an accurate analysis or not, and second, if it is, what you can do about it, and what you will do about it. If it's faulty, I'd like to know that as well and have your comments on why you think that's faulty.

    Mr. HINSON. Mr. Ehlers, thank you for your comments about the FAA and about what we're trying to do.

    The chart that you referenced, which the Committee members can see, which shows the fatal accident for 121 and commuter carriers, when we started keeping the data for commuters in the mid 1960's, I think, or 1970's, demonstrates the collective efforts of the agency and the industry and everybody else that's involved in driving the safety equation.

    But there's something on that chart that speaks directly to what you asked. Over the past five to 10 years, the accident rate has, while it's very, very low, has plateaued. We have been unable to make dramatic increases below the very low rate we have today. And it seems to bumping along at that rate.

    This is the Boeing study that the IG alluded to earlier about, if you have this rate in place, and we double, for example, the number of flights, over the next 20 years, you'll clearly be having, as a function of time, twice as many accidents. And that causes all kinds of societal issues.
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    It is clear to me, and it is clear to many others, that what we have done in the past to get to the low rate we enjoy today may be inadequate to get us to a lower rate, or even to zero in the future. And that speaks directly to your suggestion about early indicators, and the ability to see things before they happen, in whatever context, either with the inspector work force, which we're trying to address through Challenge 2000 and introducing some new technologies, or by a program that we have started called GAIN, which is Global Analysis and Information Network. This is a program that is in its sort of gestation period. It's going to take many years to develop. It is basically going to create, I hope, a data base that can be shared by civil aviation authorities worldwide where we can do analyses of normal operating environments and see trends that cause us to take actions to prevent accidents.

    So I think your comments are appropriate. We agree with them. And we have begun a process to answer your concerns.

    Mr. EHLERS. Mr. Chairman, I realize my time has expired, but I'd appreciate Mr. Broderick's comments briefly on the same issue, particularly from your 20 years experience in this field.

    Mr. BRODERICK. Well, I think that the Administrator has summarized very nicely the long range program. I think the short-range pattern detection program that you're talking about is in its prototype deployment phase right now, and that's the Safety Performance Analysis System, which takes data from all FAA inspections and permits an inspector to use it as an analysis tool and compare his or her airline, as it were, or repair station or whatever, to all the others in a peer group, and see whether it deviates from the norm.
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    We in fact were using ValuJet as a prototype carrier to develop all the computer algorithms and things like that, and it seems to work quite well. We now have to get that over the next couple of years deployed throughout the entire work force. And I believe full deployment to all 3,000 or thereabout inspectors is scheduled for the end of the decade.

    Mr. EHLERS. Thank you very much.

    Thank you, Mr. Chairman.

    Mr. DUNCAN. Thank you, Mr. Ehlers.

    Mr. DeFazio?

    Mr. DEFAZIO. Thank you, Mr. Chairman.

    One hundred and ten people are dead in what I believe was a totally preventable accident. We've heard some of the most provocative testimony I've ever heard in my 10 years in Congress from the Inspector General. And this committee has spent more than half of the hearing trying to stick political blame somewhere, or say, ''was the President involved in grounding ValuJet?''

    I say, ''thank God,'' if the President was involved, he finally did something that I agree with. If the airline was unsafe, someone made that decision whether it was the President or Mr. Hinson or Mr. Broderick. Thank you, and thank you to the President, he's not here, if he was involved.
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    So that was pathetic, for this committee to spend—there are extraordinary questions that should be before this committee, but you know what? Those questions all come back to the stumbling block that we've always had here before, which is, they cost the industry money. That's the stumbling block at the FAA, and that's the stumbling block before this committee.

    We need to prevent accidents. We need an agency that doesn't have a dual charge. You can't minimize how much that weighs upon the different people in the agency. That is an inherent contradiction. I've been saying that for 10 years on the committee. Ms. Schiavo has said it, others have said it, that has to change.

    Mr. Hall, you say here, to its credit, the FAA has adopted over 80 percent of those recommendations and over 90 percent of our urgent recommendations. Were the other 20 percent and 10 percent frivolous recommendations, or were they recommendations that you believe were warranted, that could prevent accidents and save lives?

    Mr. HALL. The Board that made those at the time and my participation on the Board, we consider our responsibility seriously. And if we make recommendations, we think they're important that they all be enacted.

    Mr. DEFAZIO. For instance, say, over-wing exits, what was it, about 5 years from the time you recommended spacing of seats for over-wing exits until the FAA finally adopted a rule?

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    Mr. HALL. I believe that's correct, sir.

    Mr. DEFAZIO. Five years. How about the seat anchors? How long did that take? We have seat anchors that are designed for propeller aircraft that won't withstand the impact of jet speeds. How long did it take to get that little one through?

    Mr. HALL. I can supply that for the record, Congressman. I don't know off the top of my head.

    [ The information received follows:]

    Enclosed is a computer printout of safety recommendation A–80–130 regarding seat crashworthiness aboard general aviation aircraft. The safety recommendation was issued December 21, 1980, and it was closed on October 26, 1988.

    [Insert here.]

    Mr. DEFAZIO. OK. Flight duty time, how long ago did you make recommendations before, and they aren't even fully adopted because the Secretary exempted the commuter airlines because of this ongoing controversy about whether or not it's OK for them to work 6 16-hour days in a row, as we had testimony here, and fly commuter aircraft?

    Mr. HALL. In 1988, the Board made recommendation, not just to the FAA, but to the Secretary of Transportation, that that issue be looked at in all modes, and that as a result of current scientific knowledge that we presently have in the subject of fatigue, that rule changes be implemented. And to their credit, the only agency that has stepped forward with a proposed rule at this point is the FAA. But that has taken some 6 years.
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    Mr. DEFAZIO. So I think we have a pattern here. If it's something that might cost money, it seems to take an awfully long time to implement.

    Mr. HALL. Well, I would say, my experience in my position with the rulemaking process is that it is a time consuming process. And many times it's not as responsive as it should be to changes that should be made for safety.

    Mr. DEFAZIO. I thank you for that comment. I would observe that in my time on the committee, I have shared those concerns. And what we get, I think, is lowest common denominator. That is, the best airlines who want to have the best maintenance are being driven by the airlines that want to have the cheapest maintenance, by the airlines that want to have the cheapest employees. When I look through the records here of ValuJet, and I'll have questions for the president, they talk about, new ValuJet captains have a minimal amount of Part 121 experience. Then they go on to talk about the mechanics, and how they have less than half the hours of training in type than any other mechanics.

    You know, and that's going to affect the good airlines, because they're going to say, ''God, they're flying for this much per passenger month.'' Everything is driven here by the bottom line, and what we're doing is pulling down the entire industry. If we regulate to the highest standard, it's not going to affect the Uniteds or the Deltas or the others. But it is going to affect some of the other airlines. And their prices are going to go up a little bit.

    And you know, I think when the plane's on the way down, most Americans aren't going to feel real good about having saved a tiny bit of money on that ticket. So I would say that we need to remove the promotion from the industry.
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    Ms. Schiavo, you mentioned a couple of times about bogus parts. Now, who was the administrator you referred to, and who was the DOT secretary at the time when you said they wanted to pull you off bogus parts?

    Ms. SCHIAVO. At the time, the administrator was former administrator Richards, and the Secretary was at the time Secretary Card.

    Mr. DEFAZIO. OK, so this is not something that we can attribute to any one particular administration, this is something over time that's been a problem?

    Ms. SCHIAVO. Oh, my, no. As I said, I have been ferreting out problems over several administrators, and two administrations.

    Mr. DEFAZIO. Now, I'm sorry, I just have been sitting here a long time. Mr. Chairman, I'm a little pent up about all this. But I feel that we need, on the committee, to step back a little bit from the political questions that are involved and go to the safety issues that are involved here, and to aggressively pursue whatever it is in the culture of the agency over a number of administrations that I believe has caused a pattern that often errs on the side of the operators and the airlines and against that of the flying public.

    And I believe that removing the promotion versus safety is a good starting point. It is not an ending point. I think the lines of questioning that were begun here regarding maintenance are extraordinary. Because what we heard was, you know, this is a unique airline, as the administrator said.
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    But you know what? It's the wave of the future. Virtual airlines are going to come in and try and compete against the better airlines, the airlines that actually have maintenance facilities and have staff who have been with them a long time and get good pay to do maintenance if we are consistently driven by the bottom line. And I think that the committee could devote a whole hearing just to that issue, and a number of other issues that will be raised here today.

    My time has expired.

    Mr. DUNCAN. Well, thank you very much, Mr. DeFazio, and we are going to hold other hearings on this.

    Mr. LaHood, I believe that you were here next.

    Mr. LAHOOD. Thank you, Mr. Chairman.

    Mr. Chairman, I'm just curious to know from you, does the committee intend to invite the Secretary of Transportation to appear before our committee on this matter?

    Mr. DUNCAN. Yes, we will hear from the Secretary at an appropriate time.

    Mr. LAHOOD. Thank you.

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    Mr. Hinson, I want to associate myself with the comments made by Mr. Oberstar about you. I think that when you came to Government, you could have gone anywhere in the country and made a lot of money. You probably could be clipping coupons somewhere and doing very well. And I think you have brought a professional element to this agency. And I congratulate you for doing that.

    I do have a couple of questions of you, Mr. Hinson, and that would be, No. 1, do you think there has been a cozy deal between ValuJet and the Department of Transportation and certain staff people at the Federal FAA? I mean, that's what's been implied. Last Monday I was struck by the USA article which details the relationship, the fact that the Secretary of Transportation held a press conference some time ago really promoting ValuJet.

    And I know that, I watched Nightline last night, and I know that there was an implication of a booklet that somebody held up, I don't know if it was Chris Wallace or the IG or somebody on that program held up a booklet where you were quoted in there making complimentary statements about ValuJet.

    I want to know if you think there's been a particularly cozy relationship between ValuJet, its president, its staff people, and people in our Government.

    Mr. HINSON. I don't think so. And let me put that in some context, and go back to your comments about the Secretary's press conference. I believe the one you're referring to is about the economic advantages of low-cost airlines and the savings——

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    Mr. LAHOOD. Yes, sir.

    Mr. HINSON [continuing]. The savings that have accrued to the American public because of the advent of low-cost carriers who are willing to provide relatively lower cost transportation.

    From the FAA's perspective, Mr. LaHood, there is no difference in safety oversight between any airline. And how an airline chooses to position itself in the economic market is irrelevant to our safety oversight. They really, there's no relationship there whatsoever. One of the very best safety records in the entire United States belongs to a low-cost, a low-fare airline, Southwest, which has operated since 1972 without a fatality.

    And let me say one other thing which I think is missing from this debate today. Until this accident that brought us here, from the regulation in 1978 and 1979, if you statistically wanted to fly on the safest group of carriers in the United States, you would have chosen a new entry, because they had zero fatalities for 17 years. There are two air carriers that started before deregulation in some form, which had accidents, but they were already in existence when deregulation occurred.

    So until this accident on the 11th of May, there had never been a single fatality in new entrant airlines in deregulation. And so statistically, if you wanted to be safe, that's where you would have gone. Now, those are the facts.

    So when people suggest or studies suggest or anybody suggests that new entrant carriers are relatively unsafe, that is incorrect. Furthermore, there is some other academic work that's been done which is very interesting. All of us who are in this business want to try to find early indicators and correlative data. We have looked, for example, at a lot of data to try to see if the number of incidents that occur, for example, the number of violations or any other sensitive violator would say, here's an airline that may be getting ready to have a, say, major accident or a problem.
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    It's been very difficult, we haven't done a total scientific look, but we don't initially see a whole lot of indication that we can do that. We want to do that some more, but we don't initially, early, see any indications that there is a correlation, at least one we've been able to find.

    Now, with respect to our oversight of ValuJet, I'm not aware that we in any way have tried to treat them any differently than anybody else. And I hope that is the case. There's no evidence that I've been presented that would suggest that.

    Mr. LAHOOD. I wonder if the Inspector General would answer my question. Do you think that there has been a particularly cozy relationship between officials of our Government, whether it be the Department of Transportation, the FAA, or anybody that works with that, and the officials of ValuJet?

    Ms. SCHIAVO. I am unfortunately unable to answer that question, because we have an ongoing criminal question, and that unfortunately is encompassed in it, and I cannot answer that question.

    Mr. LAHOOD. Thank you, Mr. Chairman.

    Mr. DUNCAN. Thank you, Mr. LaHood.

    Mr. Cramer?

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    Mr. CRAMER. I have no questions at this time, Mr. Chairman.

    Mr. DUNCAN. All right.

    Mrs. Seastrand?

    Mrs. SEASTRAND. I guess I'll follow up on what you said that, Mr. Hinson, Business Week magazine is reporting that the Inspector General has opened a criminal investigation of the FAA's handling of ValuJet. You're aware of the report, I'm sure.

    Mr. HINSON. Yes, ma'am.

    Mrs. SEASTRAND. Can you confirm whether that investigation is ongoing?

    Mr. HINSON. No, I cannot.

    Mrs. SEASTRAND. OK. Business Week reports that the investigators are examining the falsification or destruction of ValuJet reports. Do you have any information from any source whatsoever, whether from the Inspector General or independent sources, that would support that allegation?

    Mr. HINSON. No, I do not.

    Mrs. SEASTRAND. And how about you, Mr. Broderick? Do you know of any information whatsoever that supports the allegation that reports have been falsified or destroyed?
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    Mr. BRODERICK. No, I do not.

    Mrs. SEASTRAND. Business Week also reports that the FAA inspectors, or the supervisors, were threatened, though it doesn't say whether by ValuJet or by high level FAA management or by some other source. Mr. Hinson, are you aware of any information whatsoever from any source that would support that allegation?

    Mr. HINSON. No, I am not.

    Mrs. SEASTRAND. And how about you, Mr. Broderick?

    Mr. BRODERICK. No, I am not.

    Mrs. SEASTRAND. So, then, neither of you has any information of any kind that is related to these charges, and that's your testimony.

    I want to take off on a different note. We were talking about the fact of having qualified inspectors. Is it true that the FAA has lost about 5,000, 100 or basically 10 percent of its staff between 1992 and 1995 due to the overall reduction of the Federal work force that was a call from the President?

    Mr. HINSON. When I arrived as the Administrator, we had about 53,000 employees. We have about 48,000 today. So it's plus or minus 5,000.

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    Mrs. SEASTRAND. OK. Now, due to its safety mission, was the FAA given special treatment in the application of this reduction?

    Mr. HINSON. Yes, in the context that we did not reduce our direct safety work forces.

    Mrs. SEASTRAND. OK. And how did you go about accomplishing these reductions? And what effect has it had on your operations?

    Mr. HINSON. We used a Government-wide, we had, as I recall, let me think for a second, I think we used four ways to downsize. We used early retirement, normal retirement, attrition and buy-outs. And those four methods allowed us to downsize about 5,000 employees, avoiding the RIFs or other unfortunate circumstances that would have been required.

    Mrs. SEASTRAND. I noticed in the latest budget request, it shows an increase in employment, reversing the earlier reductions. Can you explain this? Do you think that perhaps originally it was cut too far, or what is your feeling on this?

    Mr. HINSON. No, we, there are a couple of reasons for that. In the controller work force, our large hiring after the strike in the early 1980's is approaching the time now when many of those controllers can begin to retire. They can retire after 20 years of service. And we're going to have to hire between 200 and 500 controllers a year prospectively to account for the loss of controllers that we expect to see.

    So that's part of it, because you have to overlap. I mean, you have to hire before you have the reductions to keep our work force at a constant level.
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    In addition, Mr. Broderick's organization has been hiring 200 to 300 inspectors a year, to try to meet a level that's required by the industrial engineering that's done in terms of staffing levels that are required. So it's in those two direct safety work forces that the hiring is occurring.

    Mrs. SEASTRAND. Last, I'd like you to comment on this. The Washington Times reports that in meeting your hiring goals, you have implemented a stringent diversity requirement. According to the Times, these goals are so at odds with existing laws that ''the FAA is extremely vulnerable to claims of willful and systematic illegal discrimination.'' Is this true, and have your diversity goals made it difficult to hire qualified inspectors?

    Mr. HINSON. Well, the FAA is in compliance with the law of the land relative to diversity, civil rights, and all the other personnel issues that are appropriate for an agency like the FAA. And we have never had difficulty in hiring across ethnic lines qualified people for all the areas of the agency. And we have been developing a work force that is broadly diversified and hopefully a model work place.

    Mrs. SEASTRAND. Thank you, Mr. Chairman.

    Mr. DUNCAN. Thank you.

    Mr. Nadler?

    Mr. NADLER. Thank you, Mr. Chairman.
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    Mr. Chairman, last night there was a Nightline on TV, had Ms. Schiavo appeared on that program. And the moderator was a fellow named Brian Ross, and the following was said on that program. I want to quote it a little to get some reaction to it. Mr. Bob Lukowski, an FAA inspector, said that inspectors have the same power, but they no longer feel they get the support if they use the power they have. Mr. Ross: that's quite a thing to say. Mr. Lukowski: that's what the inspectors come and tell me. When you went out and found something wrong on an airplane 10 years ago, they said, ''Attaboy.'' Now it's, well, we need to justify that and we have to see a report and we have to do all those other things. And it's a totally different outlook, and I can't explain why.

    And FAA former inspector, Mr. Tom Westfall, who after political complaints about his being too harsh about airlines in Alaska, according to the show, was fired. It says that there was a lot of criticism, and there was a time when a new program was introduced, a new policy called partnership with the airlines.

    And Mr. Ross then says that then-Administrator Busey promised personnel changes, again after criticism in Congress that the FAA was being too hard on airlines, startup airlines in Alaska, promised personnel changes that resulted in Mr. Westfall's losing his job. Westfall: after I left, I think the enforcement cases dropped about 80 percent, which is consistent with this softer approach to enforcement. Brian Ross: but that very partnership policy did become the way of doing business at the FAA, and inspectors say defined the FAA's regulation of ValuJet, when ValuJet went into business in 1993. Federal investigators say that helps to explain why safety violation after violation by ValuJet rarely resulted in any fine or enforcement action by the FAA.
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    Further, a little later in the program, Ms. Schiavo is quoted as saying that, well, the moderator says, Ms. Schiavo, you said you were going to investigate allegations that there was pressure on FAA inspectors from within the agency to go easy on ValuJet. Where does that stand. And Ms. Schiavo replies, after saying she was going to conduct an investigation, she says that this whole question is a very major issue, because the industry predictions and the FAA's own predictions are that if something doesn't change in the next decade, or the next 15 years, we will look forward to a major airplane, airline crash every week or 10 days.

    And further on, ValuJet is not the only airline where this has happened. We had hearings a couple of months ago, and there were many other airlines where they had thousands of inspections. And only then when something happened or when a new team went in that was not as close to the airline did they actually do something or shut the airline down.

    And in the case of ValuJet, before the crash, I believe they had something like 5,000 inspections and one has to ask why nothing was found, and only after public pressure was something found. And that will of course be something that investigation studies will have to find out.

    In other words, a number of questions come up from this. No. 1, allegations by current and former inspectors that there is a culture within the FAA over the last few years, since this policy under the former administrator, Mr. Busey, of partnership with airlines was introduced, that there's a pressure on inspectors to go easy on the airlines with respect to safety. Second question is that, both with respect to ValuJet here, and in ValuJet we see that there was a special inspection, a regime of special inspections before the crash, and normal inspections, that program did not find the fault that now has been discovered after the crash when we sent in the 16 inspectors and they investigated for more than a month. And you change policy and say you've got to ground the airplane.
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    Ms. Schiavo is quoted as saying that that's happened similarly in other airlines where the normal inspection program doesn't find any terrible problem. And then when there's special attention, then suddenly there's a terrible problem found. And Ms. Schiavo, you were quoted as saying that if things continue as they are, we're going to have, in 10 or 15 years, an airline crash a week.

    So my first question of Ms. Schiavo, you said that on television last night. What caused you to say that in 10 to 15 years, if things don't turn around, we're going to have one major airline crash a year? Why do you, second question, why do you think that—a week, I'm sorry, that in 10 to 15 years, we'll have one major crash a week. Second, why do you think it is that in the ValuJet situation, we had a lot of inspections, and then intensified inspections. Nothing terrible was found, nothing causing any action was found.

    After the crash, more inspections, and then suddenly they find all these safety violations, you have to close the airline down for a while. And do you think that it is true that there is pressure being exerted either directly or through the culture of the agency on inspectors to play too close to the airlines and not to be too critical of them for safety?

    And after you've answered these questions, I'd ask the Administrator to comment also.

    Ms. SCHIAVO. Thank you.

    What caused me to say that is I was quoting two noted sources. One was the Administrator of the FAA, who predicted that by the year 2013 we can expect to lose one aircraft worldwide every 8 days. And the other source was Boeing. That was reported in the Secretary's, at the conference, one level of safety. That came up, and it was known throughout the industry, but of course it is apparently news to the public, but that is kind of surprising, because it was known throughout the industry.
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    As concerns anything that I know about, or might have seen or might be alleged concerning ValuJet and pressures, I am not able to talk about because of the ongoing criminal investigation.

    Mr. NADLER. Well, have you noted in general, never mind ValuJet, then, the allegations that were made by this current, former inspector on Nightline last night, that since the beginning of this partnership with airlines program in 1988 or 1989, one gentleman said that the inspector, the criticisms have gone down by, the findings of problems have gone down by 80 percent, and that there is pressure on the, there is pressure not to find things critical of the airlines. Have you noticed—just comment on that.

    Ms. SCHIAVO. For example, in April my staff testified at a hearing. They reported, for example, on Arrow Air, where they had had hundreds, I do not know how many inspections off the top of my head, I can provide it for the record, and by the regular inspection team.

    [The information received follows:]

    The Miami Flight Standards District Office made 502 inspections of Arrow Air during 1994, and identified only two violations resulting in enforcement actions. The NASIP inspection of Arrow Air done between February 27, and March 8, 1995, resulted in 12 enforcement actions and suspension of Arrow Air's operating certificate for more than 2 months.

    Ms. SCHIAVO. When a new inspection team went in on a special inspection, where it is not the same people who are there day in and day out, developing a relationship with the people, when the new team went in, they got shut down. The same thing is reported by another major carrier, who wants to remain nameless. They said, and I think this is a pretty close quote, we were good friends with the FAA until we had our white glove inspection. So it was a special team of new people, new groups with special mandates that seems to make a difference.
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    Mr. NADLER. So do you think it would be a good idea that inspectors should change and not have the relationships with the same airlines, the same places?

    Mr. DUNCAN. This will have to be the last question, Mr. Nadler.

    Mr. NADLER. I have one more brief question.

    Mr. DUNCAN. That's being unfair to other members. But go ahead, very briefly.

    Ms. SCHIAVO. Yes. We have recommended that, that it would help to change the teams, and it helps to do the white glove inspections, rather than the regular old inspections, which do not seem to be accomplishing anything. And as concerns your other point about the partnership or the ''kinder, gentler, FAA,'' yes, we have noticed problems with that before, and we also have noticed problems with regional differences in enforcement.

    Mr. NADLER. Mr. Chairman, can I ask a 30 second one, last one.

    Mr. DUNCAN. Go ahead.

    Mr. NADLER. Just one further question, Ms. Schiavo. Some people have suggested that the FAA has statistics on safety records of particular airlines, safety records of particular aircraft types. We have these records for cars, we don't have these records public for airlines. Do you think it would serve the cause of public safety if the records or the statistics with respect to safety for airlines or for that matter, for aircraft, were made public?
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    Ms. SCHIAVO. It's difficult at this point, given the state of the information, and we have asked for it. For example, my office has received disks with all this data on them, and I mentioned earlier in this hearing, literally our computers ran all night and never were able to come up with meaningful information.

    So it will take a major shift in what is collected and how you disseminate it. But for example, in the May 2 report, I think that the public probably would want to know that there is another carrier with a record nearly as bad on incident and accident as ValuJet had, and one that is far worse.

    Mr. NADLER. Thank you.

    Mr. DUNCAN. All right, thank you very much.

    Mr. Tate?

    Mr. TATE. Thank you, Mr. Chairman. Thank you for having this particular hearing.

    Mr. Hinson and Mr. Broderick, you've seen this report that's entitled the special emphasis report that was prepared by your Atlanta office, dated May 6. Do you have a copy? We can provide a copy for you.

    I would like to make this part of the record, if I may, Mr. Chairman.
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    Mr. DUNCAN. Yes, that may be made part of the record.

    [The information referred to follows:]

    [Insert here.]

    Mr. TATE. My first question is for Mr. Hinson. Who prepared this report? Because there's no name on it.

    Mr. HINSON. Well, Mr. Broderick knows, so I won't speculate.

    Mr. TATE. OK, I'll let Mr. Broderick answer.

    Mr. BRODERICK. That was the beginning or that was one version of a continually developing summary report from the special emphasis findings produced by Mr. Spilner and his staff in the Atlanta Flight Standards District Office. Specifically, I'm sure a number of people had input to it. I don't have the exact author. But it was under the Atlanta staff.

    Mr. TATE. OK. Now, this report came out, let's see, May 6, which was just 5 days before the crash, correct?

    Mr. BRODERICK. It didn't come out in any sense that it was completed. That is a work in process. And in fact, I think if you look at it, you will see dates that actually are beyond May 6 on some, if that's the report I'm thinking of. It was a constantly developing summary of the special inspection results. We had a program that started on February 22, that was announced on February 16, and that was doing special emphasis inspections. And that was to be the summary report that at the time they intended to produce at the end of this program. That's been overtaken by events now, of course.
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    Mr. TATE. So this was the compilation? Was it completed on May 6?

    Mr. BRODERICK. That's the draft that existed on, and as a matter of fact, if you have, I think that draft is actually dated May 6, but was prepared later. Because I think you'll find it's got dates beyond May 6. But it's a draft that existed some time around that period of that compilation.

    Mr. TATE. Considering it came out right before the crash, was there anybody in mid or senior management that had an opportunity to review this prior to the crash?

    Mr. BRODERICK. As I say, sir, it didn't come out. It wasn't produced and distributed to people. That is, it's just as if you're in the middle of writing a report and somebody says, stop what you're doing and print that out, that is the work in process. It isn't something that was completed and then given to anybody for action. I'm unaware of that being distributed outside of the Atlanta office at that time.

    Mr. TATE. Pretty important information not to pass along, I would suggest.

    But I'll continue. Let's see. I also have another report, and this is where the confusion comes in, I have a report dated March 13, 1996, which I'd like to submit as part of the record as well, Mr. Chairman.
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    [The information referred to follows:]

    [Insert here.]

    Mr. TATE. And it's troubling for a couple of reasons, and maybe you can help me out on this, Mr. Broderick or Mr. Hinson. First, if it's taken at face value, it seems to indicate that there was critical information back in March, March 13, the date of the front of this particular report, which was 2 months before the crash.

    So it makes me want to know why it was ignored. And I'm even more concerned, because the report seems to be misleading, because there are dates after the fact. It says March 13, but if you look very closely, finding 2.03.04, dated March 27, 2.03.06, which is dated April 2, and it also has an executive summary, March 13, which is not included in the May 6 report or compilation or whatever we want to call it.

    Why was that information held back? Why weren't we aware of that information 2 months in advance? And why was it ignored? I mean, that information, it says right on the front, March 13.

    Mr. BRODERICK. Mr. Tate, I believe what you have are the documents that were produced at the request of the subcommittee's investigating staff that deal with a wide range of issues and include works in progress. I mean, that's—and maybe I'm confusing the March and the May reports.

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    But the point is, it's quite clear from that that these are things that are being developed as part of the office's development of the report on the inspection that was underway, the special emphasis program that was a 4-month long program. And they were naturally summarizing and gathering data during this program with the idea that they were going to have a report at the end of the program. And what you've apparently got is two different iterations of that or related documents. I mean, there's no, as far as I know, no, there was no attempt to distribute that report at that time, other than as a working document within the office, as an existing, evolving compendium of findings.

    Mr. TATE. Well, as a existing findings, it seems kind of odd that March 13 it came out, it wasn't passed up along to senior management, it has information dated after the fact. It seems to me, I'm just perplexed.

    Mr. BRODERICK. It didn't come out, it wasn't completed. And that's why it wasn't passed along to senior management. That is a copy of a work in progress.

    Mr. TATE. Mr. Chairman, I yield back the balance of my time.

    Mr. DUNCAN. Thank you, Mr. Tate.

    Ms. Danner?

    Ms. DANNER. Thank you, Mr. Chairman.

    I'd like to follow up, Mr. Hinson, with Senator Cohen's concern. Is there, to your knowledge, any effort on the part of FAA to look into the individual who testified before the Senate?
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    Mr. HINSON. Not to my knowledge. But let me expand on that a minute. When I appeared before the Senator's hearing on supplemental unapproved parts some time ago, he raised that issue. I assured him then that I would not accept that.

    And later, when he mentioned it again in some other forum, I wrote a letter to Mr. Broderick, reminding him of that, and he in turn communicated with everyone in his organization. And there, we have a code of ethics in the FAA, we have whistle blower protection, we have all of the standard Government protections for our employees. And we really do not want anything like that, or anything broadly resembling that, to occur. And I'm hopeful that it does not.

    Ms. DANNER. I would hope that it does not.

    Mr. Broderick, is it sheer coincidence that you announce your retirement at just about the same time we have the ValuJet problem, or had you planned to announce this retirement prior to this?

    Mr. BRODERICK. I would say, as the Administrator said earlier in his testimony, the last 6 weeks have been extraordinarily difficult ones because of the ValuJet problem. And that ValuJet problem is what gave rise to the circumstances that led me to conclude that it's best for the agency and myself that I resign, that I retire, and I give the Administrator the maximum amount of flexibility he can to make change within the agency and rebuild the public's confidence in not only the safety of the air transportation system, but the agency that I leave behind.
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    Ms. DANNER. Is it logical to assume, then, that you feel that every time there is a major problem that is created in Government, the person who is most closely connected with it should resign, instead of respond to the problem?

    Mr. BRODERICK. No. I believe it is the right course for the FAA and for me for this situation. I won't go beyond that.

    Ms. DANNER. I understand. Thank you.

    With regard to the ValuJet plane that was destroyed, I believe on the runway, in June 1995, that was a result of a fire in an engine that was overhauled, Mr. Broderick, in Turkey. Have we FAA inspectors on line in Turkey?

    Mr. BRODERICK. We have in fact done FAA inspections and certifications of that repair station after the accident. The reason for that accident was a manufacturing flaw in the engine that had existed for some time and went undetected in the inspection.

    After the accident, we sent a team of inspectors in there, and they found that that repair station was technically a very well qualified organization. There are some technical difficulties with whether or not a particular operation that was conducted on that engine, in terms of repair, was permitted. It is not the operation that should have in fact detected the flaw. They were certificated to do that nondestructive inspection at that time, both for their own, by their own government and of course by the FAA for its repair station.
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    Ms. DANNER. Maximum Mary, are you surprised I know that?

    Ms. SCHIAVO. No.

    Ms. DANNER. No, you're not. Some of the audience may be. Obviously, I'm from Missouri. And another well-known Missourian had a plaque on his desk that says, the buck stops here. I understand that yours says Maximum Mary. I will leave it to my colleagues to ask me on the floor later what that means, and I'll be glad to share that with them.

    To me, I want to say that I see it as a compliment to you. I think that you have made a maximum effort to inform people as to your concerns about, frankly, the dual mandate that FAA has had. I believe it was in 1991 that you said that, I believe this is correct, the FAA's oversight of aviation was one of the largest and most important failures in the Department of Transportation, and also that you called for the elimination of the dual mandate since 1991. I will, though, remind those who are interested that it is in statutes that the No. 1 priority of the FAA is safety. And so I think that's very important to recognize.

    I would say to those who are interested that I find your candor very refreshing. I appreciate the fact that you said that you would, and I quote, continue to find problems and report the facts, I will not lie to the public. I would suggest to those who are decisionmakers with regard to the FAA and the Department of Transportation, that they would be well advised to look at someone such as yourself inasmuch as Mr. Hinson is planning to step aside sometime between now and I suppose the inauguration in January. Because I believe that the public believes you are telling the truth. And I don't believe that they see you exercising, as Congressman Traficant said, for DC, the spin, damage control that many others, I believe, are trying to perpetrate on the public.
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    I find it quite concerning that in the manner of weeks, one's statement is turned around from something being perfectly safe to the fact that it's not safe at all. And I think that in the short span of time, that is unacceptable. And I for one on this committee do not intend to take a hunk out of you. I intend to say that I personally applaud you and your efforts and your candor and honestly.

    Ms. SCHIAVO. Thank you. I appreciate that very much. Thank you.

    Mr. DUNCAN. Thank you, Ms. Danner.

    Mrs. Kelly.

    Mrs. KELLY. Thank you, Mr. Chairman.

    And I know it's a long day for you, but I want to ask you some questions, because there is a situation in my own district that came to my desk that brought to mind something that combines a number of you.

    I have a constituent who owns a small helicopter company. One of these helicopters went down. The NTSB, I believe we called the NTSB and asked for a report about March. We don't know at this point where that report is.

    What I'm concerned about is that if there is a problem with the helicopter in question, people are still flying it.
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    Mr. Hall, when you go out and investigate a crash, and you go back with recommendations to the FAA, how long is that process?

    Mr. HALL. There is established in the regulations a timeframe for response to our recommendations by the FAA. Although we have the authority to issue urgent recommendations and the FAA can, of course, then take emergency action, either through A.D.s or other appropriate action. And that's certainly not uncommon. I do not know the exact number of days on an average response, Congresswoman, but I will be glad to get that for the record.

    [The information received follows:]

    By law, the Federal Aviation Administration (FAA) must respond to Safety Board recommendations with in 90 days. The average number of days for a first response from the FAA is 68 days.

    Mr. HALL. But normally, we get a written response within a 90 day timeframe.

    Mrs. KELLY. And on an urgent recommendation, you will——

    Mr. HALL. On an urgent recommendation, that is usually done within 30 days or in many cases, the action is taken immediately and the paperwork follows then days later.
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    Mrs. KELLY. And Mr. Hinson, then you respond immediately, is that correct?

    Mr. HINSON. As timely as possible.

    Mrs. KELLY. What does that mean?

    Mr. HINSON. Well, it means that every circumstance is different and every recommendation of the NTSB might be different. We might have one we can respond to literally within hours, if it's an emergency recommendation. There might be one that will take one or 2 years to respond to, because of circumstances.

    Mrs. KELLY. In the meantime, the public's flying around in planes that could be, where this is a recommendation that's been made for——

    Mr. HINSON. No, no, they are not.

    Mrs. KELLY. Are we talking safety here? What's this one or 2 years that we're talking about here?

    Mr. HINSON. No, they are not. Because if there is an airworthiness issue, it's an emergency and we deal with it immediately.

    Mrs. KELLY. OK.
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    Mr. HINSON. Many of the recommendations, in fact, the majority of the recommendations, have nothing to do with airworthiness of aircraft at all.

    Mrs. KELLY. I'm sitting here looking at a document that's, Mr. Hinson, it's a Safety Analysis Branch Office Accident Investigation. It's dated May 2, 1996. You're familiar with that report?

    Mr. HINSON. I believe so.

    Mrs. KELLY. Mr. Chairman, I'd like to make this document part of the record, if I may.

    Mr. DUNCAN. Yes, it may be made part of the record.

    [The information received follows:]

    [Insert here.]

    Mrs. KELLY. Mr. Hinson, the report says ValuJet has had a particularly poor accident report. It shows that quite clearly. It also cites Tower Air and Carnival Airlines.

    Based on this, have you, FAA, the FAA has undertaken what kind of reviews, have you taken any kind of unusual reviews for those two airlines?
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    Mr. HINSON. Let me make one or two comments and ask Mr. Broderick to join me in the answer, if I may. Before I answer it, however, I want to make one comment, and that has to do with the definition of an accident. And in the context of that report and any other data that's presently published by the FAA, the NTSB and the United States, accidents as described do not have the same weight. A single accident which involves a hull loss and fatalities will be reported statistically identical to a passenger sustaining, say, a broken wrist because of turbulence in flight. And clearly, there's a large discrepancy between the import and the significance of that data, except that statistically it comes out the same.

    Mrs. KELLY. I really think that that's a very good point, and we must clarify that in the minds of the public.

    Mr. HINSON. Well, I'm doing that. As a matter of fact, I've been working for 2 years with the Board, and I'm pleased to say that the Chairman and I are in agreement. We're trying to get ICAO, so the entire international community, including the United States, decides on a definitional issue for accident statistics. Because distorted statistics can often drive bad policy. And it's a fundamental driver to what we talk about.

    So having said that, in the case of Carnival, for example, the severity of the accidents reported are something less than a hull loss and/or loss of life. So they wouldn't have the same import. However, we did look at both airlines.

    Mrs. KELLY. You did look at both airlines. Right now, today, are there any other airlines where you've got all of this special emphasis, airlines?
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    Mr. HINSON. Yes. I looked at that data this morning. We have some between 35 and 45 various aviation organizations around the United States under some form of special emphasis for various circumstances.

    Mrs. KELLY. When are you going to tell the public which ones they are and what's going on? Is that in your, is that something you're going, you intend to do, and is that going to happen quickly?

    Mr. HINSON. That's a question that's been raised, and we haven't made a decision about that yet.

    Mrs. KELLY. Mr. Chairman, I'm out of time. I will yield back. Sorry.

    Mr. DUNCAN. Thank you very much, Mrs. Kelly.

    Mr. Geren?

    Mr. GEREN. Thank you, Mr. Chairman.

    Mr. Broderick, in response to Mr. Kim's question, what intervening events led to the grounding that, and allowed you all to determine some things that you had not learned from before the accident? You said we had a team of 70 inspectors that undertook a very thorough review of ValuJet, and based on what they found, the grounding decision was made?
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    Mr. BRODERICK. Yes, sir. It's actually somewhere, 50, 60, it varied from day to day, and it wasn't all the same inspectors. We drew from other offices up and down the east coast on a daily basis.

    Mr. GEREN. Was the reason for this extensive review, was it, did it arise out of concerns that came about as a result of the crash? Is that really what precipitated the decision to put 60 extra folks on this?

    Mr. BRODERICK. Actually, let me spend 30 seconds. We had started a 4-month review on February 22. We announced it February 16 within the FAA and started it February 22, did an intensive 1 week baselining inspection, and then had a series of special emphasis inspections going on for March, April, May, and intended to finish it up in June.

    Toward the end of that, we had planned a second inspection. As a matter of fact, we had planned to initiate a second inspection to compare to the February results the Monday after—I'm sorry, Monday a week after the accident. So what we did after the accident was, we decided to move that back a week, in other words, start it the next day, and make it, instead of a 1-week long thing, 30 days long in much more detail, just to see if there was anything that we could develop that was in any way related to the accident, which of course seems to be not the case.

    Mr. GEREN. I guess the reason I ask that is, had it not been for the accident, it's possible that it would not have been subjected to this thorough, or as thorough of a review, and likely ValuJet would be flying today, even though the reason for the grounding had nothing to do with the circumstances that led to the accident. Let me just say further, I wonder if you were to subject American Airlines, you said that would be the equivalent of having 700 inspectors there, 600 at Delta, 600 at United, would we be here today with a hearing on the findings of all those airlines if you were to have subjected the whole industry to that kind of review, and if that's the case, does it call into question whether or not our routine review is adequate?
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    Mr. BRODERICK. Well, I think what you see is a difference in the circumstances. If you take a look at what we were doing with ValuJet, there were a number of programs already being put in place to improve the compliance status of the airline with regard to Federal Aviation Regulations. Now, if you take the accident away, the intensive inspection and oversight would have continued. Many of these programs would have matured. As somebody has already referenced, we saw improvements already in May, in early May, following the accident.

    So what I think is a likely scenario is that things would have been a lot different today and a month from now, and the compliance status and the implementation of these programs would be such that ValuJet would have been a better carrier next month than they were 2 months ago or 3 months ago. But this of course is apparently unrelated, as far as we can tell from the Board's work so far on the accident.

    Mr. GEREN. But the exhaustive review and the grounding would have happened with or without the accident?

    Mr. BRODERICK. Not in the depth that it happened, and we certainly wouldn't have had 60 people on the airline. We probably would have had, oh, I'll take an estimate of 20 plus or minus for a week sometime in mid-May, and then we would have been evaluating that data in the June time, right around now, and be completing our effort for the inspection.

    Whether or not we would have turned up the same systemic issues, whether we would have found the same specific difficulties that caused us to suspend ValuJet's operations, is something that you can never answer, a what-if question.
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    Mr. GEREN. Mr. Hinson, regarding the whistle blower question, and following up on a question one of my colleagues asked you earlier, some of the allegations that Ms. Schiavo made, and Senator Cohen, are really very damning indictments of the FAA as far as its environment and whether or not it's conducive to people coming forward with information that would make the agency perform better. You responded that you would, you're hopeful that that environment doesn't exist.

    After what we heard from Senator Cohen, I would think that an exhaustive internal review would result, you wouldn't be here saying, I'm hopeful that environment doesn't exist, but the same sort of intensity that he claims has been used to find this person who spoke through a voice modulator and whatever, and checking airline flights and on and on, it's hard in any agency to have an environment that's conducive for people to come forward and criticize their own agency, probably particularly hard in a safety agency. The consequences are more significant where there's a failure in a safety agency.

    But I guess I would have liked to have heard a little more intensity in your response to the question on whether or not those things actually occur, and it's—Ms. Schiavo, I don't know how long she's been talking to you all and how much of this has been through the press and how much of it's been to you. But have, over your 3 years there, have you worked to try to address this whistle blower environment, and if so, do you have some progress to report? I assume her criticisms, this isn't the first time you've heard them.

    Mr. HINSON. Thank you for the question.

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    The—how do I want to start here. There are a number of processes in place, procedures at the FAA, for people to come forward with concerns. I have a hot line, for example, that can be used anonymously. And we listen to that every day, and we do get complaints and we investigate them and try to work with the employees. Some are not anonymous. Some people leave their name. And we in fact go forward with that.

    The problem of how to have your employees be willing to come forward when you have a hierarchy of management is not unique to the FAA. It's in every organization, in and out of Government. There are always people who believe that they have been taken advantage of or not listened to or lost a promotion because of some circumstance, or who are not listened to for whatever reason, and would suggest, if I go out and talk to somebody, I'm not going to, you know, I won't get promoted or I may even lose my job. That is a challenge for all of us who manage large organizations.

    One of the things that's unique in the FAA is that since 1984, we have had an employee survey conducted biannually. Very few agencies in Government do that. But we do. And we measure the various work forces within the FAA. The single highest job satisfaction in the agency belongs to Mr. Broderick's organization, certification and regulation, and has consistently every 2 years for the past several surveys.

    That is a reasonable indication that his work force is I would say healthy, at least I hope they're healthy. Will we always be able to make everybody happy? No. Are there people out there who will be taken advantage of by some supervisor? Yes.

    We do have management training. All of our people have to go through management training, learn those skills, and we afford them continuing education. I have personally been to almost every single flight standards office in the FAA in the last 3 years, all of the air traffic control centers, etc., and met with employees. I do not get the sense that our employees are particularly unhappy or unsettled or in any way feel like they're taken advantage of. I'm sure there are some.
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    Mr. GEREN. Mr. Chairman, I know my red light's on, and we also have a vote.

    It's not their personal job satisfaction I think that would be the concern of the committee, even though obviously that would affect their morale and their work. It's whether or not somebody could go in front of Senator Cohen's committee and testify openly and not be subject to retribution. It's more that issue that I think is the concern that I raise.

    And I'm imposing upon my time, the red light's on. But it's that issue, rather than——

    Mr. HINSON. I would hope, my answer to that is, without asking everybody individually, I'd just tell you that I would hope that's not the case. There are some, of course, but I would hope that is not the case.

    Mr. DUNCAN. All right, thank you very much.

    Unfortunately, we have to break at this time for a vote. And we'll start back just as soon as we possibly can.


    Mr. DUNCAN. We'll resume with this panel, so that we can move on through.
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    All right, we're going to go ahead and proceed now, and we go now to Mr. Bachus.

    Mr. BACHUS. Thank you, Mr. Chairman.

    Mr. Hinson, I'm very confused by something. Mr. Tate mentioned it. I've got the May 6 report, which is a draft copy. It's called a preliminary inspection report. And I know the press has read over this, it's been in all the news accounts. And it comes just five or 6 days before the crash. And it contains some very serious safety deficiencies in ValuJet's operations.

    As Mr. Tate said, that's not a lot of time to respond. And what really intrigues me, and this is what I'm totally mystified by this, I've got this March 13 report, which is essentially this report with, and it's worse. That's my reading of it. I've looked at both of them.

    This report talks about, you initially looked at six airplanes and you found, you looked at six of their airplanes back in February. How many of them did you find safety violations with? Five?

    Mr. BRODERICK. Mr. Bachus, I believe during the February special emphasis inspection, we actually looked at or rode on every one of their aircraft for that 1 week period, in every route.

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    Mr. BACHUS. But you did a comprehensive look at six, from what I've seen here.

    Mr. BRODERICK. That may be. OK.

    Mr. BACHUS. You initially took a look at six aircraft immediately. And you found five of them had safety problems. Is that right?

    Mr. BRODERICK. I don't have the report in front of me, so I'd have to look at it.

    Mr. BACHUS. One of them had an engine oil leak, which is pretty serious.


    Mr. BACHUS. Hydraulic fuel leaks, missing or loose hardware. One of them had three, the left engine had three different problems, or there were three different problems with one of the engines.

    But that's 83.3 percent of their airplanes had safety problems. But you know, what I don't understand is in this, the final report, that's not in here. I don't see how, you know, I could see how if this were dated March 13, I could see how it grew into this. It seems to me like, it seems like the March report was almost went, got milder as it went along.

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    Mr. BRODERICK. Why don't we just give you a complete analysis of every single one of the findings in there, and why the findings in one report aren't in the other. That's probably the easiest and most time efficient thing to do, sir.

    [The information received follows:]

    [Insert here.

    Mr. BACHUS. Let me ask you this. By March 13, had any of the management looked at the report?

    Mr. BRODERICK. The March 13 report would have been an initial compilation of information from the February 22 through 29 special emphasis that resulted in the letter that went to ValuJet on the 29th of February, limiting their growth and talking about corrective actions that are needed. So the answer is yes, to the local management, that's correct. It wasn't something that came from Washington.

    Mr. BACHUS. It wasn't something that came from higher up, from the executive on up?

    Mr. BRODERICK. No, sir. It's generated by the field people in the Atlanta Flight Standards District Office, the people that are actually managing the certificate.

    Mr. BACHUS. Why does it have an executive summary on it?
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    Mr. BRODERICK. It's written, I mean, my quick review is that it's written in the standard format of a National Aviation Safety Inspection Program report, a NASIP report, or a RASIP report.

    Mr. BACHUS. But you know, the May 6 report does not have any summary or executive summary on it.

    Mr. BRODERICK. All of these reports, as I understand them, are works in progress. They are being, they are development tools that were printed and they were, existed in the files of the office and they were made available to the investigators when requested.

    Mr. BACHUS. Well, if you'll look, I mean, if you'll look at this, this is far more complete. I would think you'd add stuff instead of take away.

    Mr. HINSON. We will do that, Mr. Bachus. Let us answer your question in a careful way. Because again, just to reemphasize something I said earlier, this is a dynamic situation. It's not static. The airline was in fact changing and trying to answer the FAA's concerns all throughout this period. So perhaps some of the things that aren't there had been addressed.

    Mr. BACHUS. Well, I understand that. But you know, May the 6, the press gets, you know, they get hold of this, which they think is a report on all that you found. But there are things in the March 13 that are no longer in this. I mean, could that have misled people to believe it wasn't that bad? Do you understand what—you can understand my——
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    Mr. HINSON. Sure, we have the same problem. Because under FOIA today, and under the ability of everyone to get everything we have, all of our employees have documents in their desks and in their file cabinets all the time. You can accumulate those at any particular point and see about any story you'd like to see. And it makes it very difficult——

    Mr. BACHUS. This is pretty good. This is March 13, and I think you could have put it out March 13, and you'd have more than you had when you put it out May 6. It even has a summary.

    Mr. HINSON. We'll look at that for you.

    Mr. BACHUS. Now, I am confused in that the March 13 has got some things, it's dated March 13, it has some stuff in there from April 2. I mean, you know, it sort of puzzles me.

    Middle of last year, the Defense Department said ValuJet can't carry military personnel. Doesn't say for them to get on there. They said it was unsafe, is that right?

    Mr. BRODERICK. It didn't meet what they call their passenger service standards, I believe. They include the FAA safety findings, they do their own inspection as well with an air carrier survey team. And then they evaluate a number of things that are not safety related.

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    Mr. BACHUS. But looking at it, they expressed serious safety concerns.

    Mr. BRODERICK. Yes, that were corrected by February, or January, actually.

    Mr. BACHUS. Well, you know, I'm not sure they were. Let me tell you why. They said back on August 25, this isn't safe for our military personnel. Now, that's a summary, but I think that's what they said. Then, in the meantime, they came back and they said, later, that you could get back on these planes. But when you asked DOD why they made that decision, they said they were unaware of all you all had found in the interim. Were you all talking to them?

    Mr. BRODERICK. We talk to them on a daily basis and share all data. I've got people that work for me that are posted out in St. Louis at the Air Mobility Command. And all I can tell you is that they made a reevaluation of the carrier in January, and on February 10, I believe was the date, signed a document which admitted ValuJet into the program. We share data with them, but they make independent judgments from ours.

    Mr. BACHUS. And then 3 weeks later, you all had such serious concerns that you all said, you can't add new routes, right? Something happened, and it doesn't seem like you're talking. Do you understand?

    Mr. BRODERICK. You'd have to ask them why they made the judgments that they did. Ours are of course a matter of record.
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    Mr. BACHUS. Mr. Hinson, you said that, you were talking about the low-cost carriers, and Southwest, one of the most safest. But now, ValuJet was 10 times, had 10 times more incidents and their accident rate was 10 times higher than the average low-cost carrier, right?

    Mr. HINSON. Not in fatalities, until this accident.

    Mr. BACHUS. Well, fatalities, yes, but I know you said that accidents don't indicate——

    Mr. HINSON. And that's what I was referring to with Southwest. They haven't had a fatal accident since——

    Mr. BACHUS. But you know, I would think that safety violations and minor accidents, in January alone, they ran off the runway three times. I mean, that might not, that doesn't mean——

    Mr. HINSON. You're absolutely right, and that's why we started, among other reasons, the special emphasis inspection in February.

    Mr. BACHUS. But you all knew they had hard landing and run off the runway three times in January?

    Mr. HINSON. Yes, of course we know that.
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    Mr. BACHUS. Did that cause a red flag to go up?

    Mr. HINSON. Of course it did. And that's why we started the special emphasis inspection on February 22. Yes, sir.

    Mr. BACHUS. You know, I just read this, and I'm, in August the year before, they flew around and they landed with enough fuel, they had so little fuel in the airplane they couldn't have even gone around one more time. Now, that doesn't indicate they had fatalities. But it does indicate that had they had to make one more approach, the plane would have fallen out of the sky.

    Mr. HINSON. We agree with that, absolutely, everything you're saying.

    Mr. BACHUS. That's true?

    Mr. HINSON. Well, I don't know the specifics. Well, to be technically correct, minimum go-around fuel does not mean you can't go around once and land. Minimum go-around fuel is a company policy.

    Mr. BACHUS. But that's 2500——

    Mr. HINSON. They can go around on 2500 pounds, easy.

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    Mr. BACHUS. But thai was 1800.

    Mr. HINSON. Even that. But——

    Mr. BACHUS. All right, they could.

    Mr. HINSON. Yes.

    Mr. BACHUS. But that really scares you. Doesn't it scare you?

    Mr. HINSON. Of course. It scares me, too. And I agree with you. And that's why we did what we did.

    Mr. DUNCAN. All right, I'm sorry, we've got to move on now to Mr. Menendez.

    Mr. MENENDEZ. Thank you, Mr. Chairman.

    I want to thank all the panelists so far for their stamina, if nothing else, so far at this point.

    And I have a lot of questions. I don't know that I'll get through all of them, so I'd appreciate your working with me to be as crisp and precise as possible.

    Ms. Schiavo, you've been a leading critic of the FAA. You've provided the Senate with over 3900 pages of documents, and stated that several of those documents show that the ValuJet accident was preventable. Are these the documents on pages 3906 to 3925 that you refer to in a letter to Senator Stevens on May 31 of this year?
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    Ms. SCHIAVO. I do not have the Senator Stevens document in front of me. But if that is what you say it is, fine.

    Mr. MENENDEZ. Well, OK, would you get back to us to see, when you have that opportunity to review that letter? In this letter you say, we've also included three important documents related specifically to ValuJet. See pages 3906 to 3925. And in context, one would read that that in fact is the essence of what you suggest are the items that, had they been addressed, would have made the accident preventable.

    Now, I'm trying to reconcile your previous testimony, when you were asked, was this accident preventable, you seemed to hesitate from coming to that statement. And yet I think you've made that statement in the past.

    Ms. SCHIAVO. What they were asking about is why I was concerned and why I said I would not fly on ValuJet, and why I thought something was wrong.

    Mr. MENENDEZ. But there's a difference between flying on ValuJet or believing you should or should not fly on ValuJet, and whether or not an accident was preventable or not.

    Ms. SCHIAVO. Oh, in this case, and in almost every case, an accident, all are preventable. Absolutely.

    Mr. MENENDEZ. But you don't know that based upon the specifics of this case?
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    Ms. SCHIAVO. No, because the NTSB report is not in.

    Mr. MENENDEZ. Now, in your same letter of May 31 to Senator Stevens, you said, ''There was indeed some dereliction of duty at the Department of Transportation, but not by me.'' Can you tell us, tell the committee who are the names of the individuals you believe were derelict in their duty?

    Ms. SCHIAVO. I can not give you specific names of individuals without setting off another maelstrom. But I think from all the things that we have talked about and from things that were not done and inspections that were not performed and things that were not found, and from all the things we found at the FAA, I think, yes, some people were not doing their job.

    Mr. MENENDEZ. But the fact of the matter is, you put it here in writing to Senator Stevens, I think I've seen several of your interviews. How can you make such a broad comment as dereliction of duty and then not state who it is that in fact has committed that dereliction of duty, as the Inspector General?

    Ms. SCHIAVO. I think in terms of dereliction of duty, overall, there were lots of people, or maybe an organization as a whole, for what has happened, perhaps the entire organization is.

    Mr. MENENDEZ. But you can't give us any names today?

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    Ms. SCHIAVO. I will not give you any names today.

    Mr. MENENDEZ. You won't give us any names today?

    Ms. SCHIAVO. No.

    Mr. MENENDEZ. Well, did you discuss, since you won't give us any names, did you discuss the specific individuals who you believe were derelict in their duty with the Administrator of the FAA?

    Ms. SCHIAVO. In responding to Senator Stevens, no.

    Mr. MENENDEZ. Or not in response to Senator Stevens, did you in fact go to the FAA Administrator and say, I believe there are several people derelict in their duties, here they are, and here's what I think should be done about them? Did you do that?

    Ms. SCHIAVO. Over the years in my job, I have gone to the Administrator and others at the FAA many times and indicated persons who were derelict in their duty. That is correct.

    Mr. MENENDEZ. I'm talking about, this is cited in the context of this specific accident.

    Ms. SCHIAVO. No, I was not talking about ValuJet in specific.

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    Mr. MENENDEZ. You were not talking about ValuJet.

    Ms. SCHIAVO. I was accused by Senator Stevens of being derelict in duty in not bringing problems to the attention of the FAA and the Secretary, and I think that is grossly incorrect, and I pointed that out.

    Mr. MENENDEZ. Now, is your home number listed?

    Ms. SCHIAVO. The FAA personnel have my home number, because in many instances in the past, I have given it out. Also, as everybody in the FAA knows, the control center will patch you through to my home.

    Mr. MENENDEZ. OK, so it's not——

    Ms. SCHIAVO. Even you could call me.

    Mr. MENENDEZ. Well, I don't intend to bother you at home. Is this a normal procedure, though? Do you normally have people that want to give you information calling you at home?

    Ms. SCHIAVO. Not often, no.

    Mr. MENENDEZ. Let me ask you, I have heard and I'd like to hear from you that FAA inspectors wanted to testify, but in fact only if they could so in public, face to face. Is that a fact? And then they were told by, I believe members of your department, that they would not be needed. In fact, we have, the Senator came before and said they had somebody behind the screen. Is that true?
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    Ms. SCHIAVO. Certainly not by my office.

    Mr. MENENDEZ. So in fact, if inspectors came forward and said, we want to go testify, but only if we can do it face to face with the Members of Congress in open public, you would say that, absolutely, we should have that? Your department never told anybody, no, we don't need you in that respect?

    Ms. SCHIAVO. From my office? Not to my knowledge. And it certainly would not be my opinion. For the rest of the Department of Transportation, I can not speak.

    Mr. MENENDEZ. Mr. Hinson, let me just ask you briefly—I see my 5 minutes are up.

    I'd like to submit a series of questions for the record, Mr. Chairman.

    Mr. DUNCAN. Certainly you may do that.

    [The information received follows:]

    [Insert here.]

    Mr. MENENDEZ. But if I just may pursue on one line——

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    Mr. DUNCAN. Go ahead.

    Mr. MENENDEZ [continuing]. Very briefly. Mr. Hinson, did the Inspector General ever come to you and say that someone in your organization was derelict in their duties as it relates to this accident?

    Mr. HINSON. No.

    Mr. MENENDEZ. Did the Inspector General ever confront you with dereliction of duty on your own part?

    Mr. HINSON. No.

    Mr. MENENDEZ. Did the Inspector General ever provide you with documents which showed that the ValuJet accident was preventable?

    Mr. HINSON. No.

    Mr. MENENDEZ. And last, Secretary Peña was in New Jersey yesterday, and I asked him what I guess is the obvious question, I think you partially answered, I want to just make sure that these stories jive. I asked him, you know, how is it possible that you said that these flights were safe under the context of what we now know. And his response to me was that he had spoken to several FAA employees who had worked with ValuJet and who had actually inspected ValuJet, and that he asked the inspectors a series of questions about the safety of ValuJet, including whether they would recommend grounding ValuJet at that time. And I'm led to believe that the answer at that time was no.
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    Is that a true statement?

    Mr. HINSON. That is correct, because I was in the meeting.

    Mr. MENENDEZ. And so therefore, the Secretary's statements were based upon the information given to him by the people most intimate with the knowledge at that point in time about the safety of ValuJet?

    Mr. HINSON. That is correct.

    Mr. MENENDEZ. Thank you, Mr. Chairman. I have other questions, I'll submit them for the record.

    Mr. DUNCAN. Thank you very much, Mr. Menendez.

    Mr. Coble?

    Mr. COBLE. Thank you, Mr. Chairman. Good to have you folks with us today.

    Mr. Chairman, I missed the early part of the morning, most of the morning session, in fact, all of the morning session. And I don't think the question I'm going to put to the panel has been pursued to this point.

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    Ladies and gentlemen, let me visit with you just a minute. Many observers believe that ValuJet has been trashed because they are not a giant in the industry. Now, giants, as we all know, are more formidable and less vulnerable than those who don't enjoy giant status. I'm thinking aloud, this may or may not be a sound proposal.

    Conversely, there are others who believe that in view of ValuJet's questionable safety record, they should have, the FAA, should have, as we say in the rural south, shut her down long ago. Now, query is to whether either of these two have substance.

    Let me visit with you about my specific question. February 29, 1996, the FAA inspectors in Atlanta, I'm reading from a summary, take extraordinary step of prohibiting ValuJet from adding any new planes or routes without prior FAA approval. Action is motivated by concern over ValuJet's flight pay policy, which I presume denies payment to pilots who do not complete scheduled trips, tight 25 minute turnaround schedules, and failure to manage repetitive discrepancies. Now, I presume that refers to maintenance discrepancies.

    Yet, on May 1, 1996, 2 months subsequent to February 29, the FAA authorized the addition of LaGuardia and Fort Walton to ValuJet routes.

    When one considers that on May 1, the FAA was conducting a thorough review, a special emphasis review, of the ValuJet operations, perhaps Mr. Hinson, you or Mr. Broderick, or anyone, but specifically you two, my gut feeling would say to me that at this point perhaps routes should have been discontinued rather than added. Illuminate for me.

    Mr. HINSON. Let me start, Congressman, and then I'll ask Mr. Broderick to help me.
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    With respect to large and small airlines, we really do not attempt to make any differences in terms of the policies, our inspectors, our programs used to deal with those specific carriers.

    Mr. COBLE. I'm not alleging that. I'm just sharing with you all what other folks have shared with me.

    Mr. HINSON. My apologies. Let me ask Mr. Broderick to talk specifically, then, about the prohibition against them adding aircraft in February, and then the addition of two cities, as you suggested, in May.

    Mr. BRODERICK. The prohibition, sir, was a prohibition against making changes without their specific approval. It's very unusual to put a cap, if you will, on either routes or number of aircraft in operation specifications. It was done with the full knowledge that based on the mutual agreement of the airline and the inspectors as was just referred to, on the scene who best knew what was happening with the carrier, if they thought that an airplane might be appropriately added to the certificate, or that a route might be safely added, that they could do that. That was an authority that was specifically within their competence down at Atlanta, and that's where it was handled. It was done by the people who knew the most about the carrier at the time.

    Mr. COBLE. And so apparently, what was revealed to you all on May the 1, in your continuing investigation, there was nothing inconsistent, I assume, by adding these routes? Is that a valid assumption on my part?
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    Mr. BRODERICK. There was nothing improper about adding the routes. And the adding of the planes gave them some more flexibility for scheduling maintenance.

    Mr. COBLE. All right, let me, and I'm admitting my lack of knowledge with this question, but I have no problem doing that. When I refer to the ValuJet flight policy of denying pilots who do not complete scheduled trips, I presume, Mr. Hinson, if I take off and then something occurs and I have to come back to the point of origin, does that mean under the conditions I just laid out that I would not be paid for that trip?

    Mr. HINSON. I'm going to have to speculate a little bit, because I'm not intimately familiar with ValuJet's pay policies. I will provide you that answer for the record.

    Mr. COBLE. I'd like to know that.

    Mr. HINSON. Yes, sir.

    [The information received follows:]

    [Insert here.]

    Mr. COBLE. Because if what I say is correct, I can see how perhaps compromise of, safety might be compromised, if, my gosh, I can go ahead and make it to Salisbury, Maryland, rather than go back to Washington, so I'll get paid for this.
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    Let me ask you one more question. Mr. Chairman, I see the red light has illuminated.

    Do you know what is normally done among other airlines regarding scheduled or unscheduled flights, or uncompleted flights?

    Mr. HINSON. Well, it's been a while since I've been in the industry. But historically, for most air carriers, pilots, like crew members, are paid on a monthly basis, on a minimum guarantee or schedule, whichever is greater, so that if they don't complete a trip, for example, they still have a monthly minimum guarantee that's say, some number of hours, like 75 hours. If they fly as much as 85 hours, they get paid for that.

    So I believe that's the way it's done still today, for the most part.

    Mr. COBLE. OK, thank you. And thank you, Mr. Chairman, my time has expired.

    Mr. DUNCAN. Thank you, Mr. Coble.

    Ms. Brown.

    Ms. BROWN. Thank you, Mr. Chairman.

    The time that I have allotted, I would like to concentrate on the study that the Department of Transportation recently completed, the low-cost airline service revolution. In the study that came out in April, it discussed how low-cost fares are having a profound effect on efficiency, competition, consumers and industry structure. Was the safety of low-cost carriers reviewed in this study? If so, what did the study indicate about safety of low-cost carriers?
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    Mr. HINSON. I don't think, Ms. Brown, that it was a part of that study, safety, but a quick study was done in another context, which is also public now.

    Ms. BROWN. Southwest Airlines, a low-cost carrier with an outstanding safety record, how are those operations different from ValuJet?

    Mr. HINSON. Well, I don't think they differ a great deal. The difference would be that Southwest Airlines has experienced their growth over a very long period of time, since 1972, for example. So 24 years.

    ValuJet has been growing much more rapidly. Southwest Airlines has a system that's proven and demonstrative in place for maintenance, particularly on the maintenance system management area. And ValuJet has had problems in this area.

    And I think in broad context, those would be the two principal differences.

    Ms. BROWN. Well, in keeping in mind that the growth in the industry is in these low-cost carriers, what precautions and planning has been done to regulate the growth?

    Mr. HINSON. You have raised, I think, of all the things we've talked about today, you have raised one of the really important questions. It's one of the issues that I've asked not only Mr. Broderick's organization, but my deputy, Linda Daschle, to look into.
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    And that is to see if during the first part of an airline's growth, the first, second and third year, for example, there are things we need to do differently than we have done in the past. I think that's a very legitimate question. We may decide no. I don't know what the answer to that will be. We may decide yes in some context.

    But you have put your finger on exactly an issue that we're dealing with.

    Ms. BROWN. How are other countries handling the safety and promotion of their aviation industry? Is it separate agencies or just one agency, the way we're doing it?

    Mr. HINSON. I'd like to get back to you with this. I don't want to speculate about that. I know of some countries that do it differently than we do, but I'd prefer, if it's agreeable with you, to provide that answer for the record.

    [The information received follows:]

    [Insert here.]

    Ms. BROWN. Inspector, would you like to comment on any of these?

    Ms. SCHIAVO. Well, no. My experience with foreign countries would be anecdotal. We have worked with some foreign officials, basically in regards to our bogus parts cases. And that has been my experience with foreign countries.
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    Ms. BROWN. Well, I'm speaking of low-cost airlines. Is there something that we should be doing differently?

    Ms. SCHIAVO. My concerns were raised over some very real trends and some incidents that it literally did not take a rocket scientists to see. There was a carrier with a great number of incidents, five incidents in a very short period of time.

    My concerns did not have anything to do with the fact that it was a low-cost carrier. It had to do with the fact that it was a carrier that was showing a consistent number of incidents or accidents. And in one instance, just plain bad judgment. And that is why I said, hey, wait a minute, there is something going on here. It did not take a room full of statisticians to figure out, you had better start looking at this, because there is just too much going on.

    And so actually, my concerns did not have to do with the fact that it was low cost. It had to do with the fact that it seemed to be incident and accident prone.

    Ms. BROWN. Thank you, Mr. Chairman.

    Mr. DUNCAN. Thank you, Ms. Brown.

    Mr. Lipinski requested that he go last, so we can say we saved the best for last.

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    Mr. LIPINSKI. Thank you, Mr. Chairman. And you're absolutely correct.


    Mr. LIPINSKI. Mr. Hall, I'm glad that you're still here. And since you're still here, sitting patiently, I want to ask you the first question. And the first question for you is, in your testimony, many hours ago, you talked about a management culture. Now, the inference that I drew from that, you were talking about commercial air carriers. The inference I drew from that is that I could reasonably assume that there were some management cultures in the airline industry that would be putting profits ahead of safety. Now, that was the conclusion I drew from your statement.

    Would you please elaborate on that statement for me, so that I will clearly understand what you were referring to them?

    Mr. HALL. Well, the management culture in my remarks, made some time ago, Congressman, referred to a speech that I had made at the aviation summit. As you know, we had a series of accidents in 1994 which precipitated Secretary Peña calling a summit to discuss how we reach a goal of zero accidents. And I said at that time that I felt two of the issues that needed to be addressed were the subject of management culture, I think that's the culture both within the regulatory body and within the private industry or manufacturer.

    As you know, and it has not been discussed in great detail in this hearing, but I'm sure will be in subsequent hearings, we're looking here at the actions, in the ValuJet accident, actions that we will be examining closely in our hearings, the actions of a subcontractor. These issues, along with FAA oversight, are issues that were going to have to be addressed if we were going to reach zero accidents. And I think that is being able for safety to be put first, and the emphasis for safety in an organization to be at the top of the list.
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    I think that's what both the Administrator and the Inspector General have alluded to, is the challenge for all of us in leadership, is to try to be sure that the emphasis is first on safety and then obviously the financial concerns and interests are going to take a very prominent place. But they will, if safety is not put first, then eventually they will overcome.

    Mr. LIPINSKI. Well, based upon your elaboration, I would have to assume that you do have some concerns about safety being placed first by the manufacturers, by the commercial carriers, by the regulatory agencies, which I assume is the FAA.

    Mr. HALL. Well, not necessarily. We do our work on the mandates you give——

    Mr. LIPINSKI. Would it be your agency? I'm asking you a simple question. You said the regulatory agency. Who do you mean by that?

    Mr. HALL. Well, the FAA or the FRA or the RSPA, who is responsible for the handling of hazardous materials, the regulators. We have a situation right now with flight data recorders. A very tragic accident occurred in Pittsburgh, Pennsylvania, that because of the passage of time, a lot of people have forgotten that 132 people died in Pittsburgh, Pennsylvania on a 737.

    We made recommendations back then that those airlines that are still, those planes that are still flying should be retrofitted with modern flight data recorders with up to date parameters. That recommendation has been opposed by the industry. Now, you know, I can take you, walk you through, Congressman, all of the different accidents. But all of the things that we do are based on events that actually happen and recommendations that we think will prevent those events from reoccurring.
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    Mr. LIPINSKI. And I assume that the reason it has been opposed by the industry is, it would cost money, and thereby one could——

    Mr. HALL. That's my understanding.

    Mr. LIPINSKI [continuing]. Draw the logical conclusion that if we would install these, it would improve safety, but we're not installing them because it's going to cost the industry money.

    Mr. HALL. That's correct.

    Mr. LIPINSKI. So when I asked you about the management culture, and I got the inference in regards to putting profits ahead of safety, that is probably what, in a very diplomatic way, you did voice a concern about?

    Mr. HALL. I always try to be diplomatic when I appear. Because I feel that that's the most effective way to get things accomplished. People have different ways of approaching issues, but I do feel that you cannot have a conversation about safety without thinking about the economic consequences, obviously, that drive a lot of the decisionmaking.

    Mr. LIPINSKI. Well, as a southern gentleman, you are always very diplomatic. As a northern, big city individual, perhaps I'm a little bit more direct than you are.

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    Mr. HALL. Yes, sir.

    Mr. LIPINSKI. But now we will move over to my good friend, Mr. Hinson and Mr. Broderick.

    I still have, I still don't understand, and I know you've been asked this question here today, you have been asked this question by the news media and everybody else, that what caused you to shut down ValuJet when you did so? Now, I have the consent decree here that lists all of their problems. I have a chronology of the examination of ValuJet prepared here by the staff. And I also have another one from the FAA itself.

    And I would like Mr. Hinson or Mr. Broderick to tell me what specific problems that ValuJet had that caused you to shut them down that were not there prior to the crash. Because it is my humble opinion that the evidence that you had prior to the crash would have been significant enough to shut them down.

    But I'm just speaking as a lay person. I'm not a lawyer, I'm not an expert in aviation. But it's just my layman's opinion and I really have not yet heard yet from either one of you what was it that caused you finally to move to shut them down.

    Mr. HINSON. With your permission, I'll ask Mr. Broderick.

    Mr. LIPINSKI. Perfectly all right with me.

    Mr. BRODERICK. Mr. Lipinski, I think, as I indicated, the Atlanta folks had been analyzing a lot of data that was coming in, and around the middle of the week, or around the 12th of the month, they did not yet see any kind of systemic problems of the nature that would lead them to believe that they had to suspend ValuJet's operation.
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    There were, I think, several things. Let me give you two. One is, they ran into a parts control problem in the stocks and stores area, and that spread out a little bit, if I can say, when they tried to track it down, to a rapid loss in the organization and confidence of the ability of the company to maintain adequate control over life limited, time limited parts in the inventory, parts that are critical to aviation safety and need to be tracked and very carefully controlled and followed. That was one area that developed toward the middle of the week.

    The second area was a series of x-ray inspections that are a non-destructive inspection for aging aircraft purposes. You know, we have a large series of required inspections for aircraft after they get about 15 years old, because of the aging aircraft activities that we undertook following the Aloha accident.

    We found some questionable inspection results. This goes back to examining paper, not airplanes, but it shows why paper is so important. They indicated that about 25 aircraft had had x-ray inspections done that did not appear from the data available at the time to be appropriate inspections carried by appropriately qualified people. ValuJet could not provide us over a several day period with satisfactory explanations for this.

    And this is not just one single inspection. But it's a series of inspections and airworthiness directives on a wide variety of aircraft. As a matter of fact, as soon as we found that problem, 20 of the aircraft were not being used, 5—I think these are the right numbers—5 of them were immediately taken out of service or required to be taken out of service by the FAA.

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    And those are two good examples of problems which were significant and gave rise to a concern that there was a thread underlying these isolated events that showed an inability to properly conduct the maintenance programs, the control over parts, etc., that is required of an airline. There were others, but those are two that immediately pop to mind as examples of systemic rather than isolated instances.

    So around the 12th, 13th of the month, the view of the people closest to the problem changed from looking at something that was a number of serious but isolated events to not only that, but an underlying fabric of systemic non-compliance. Those two things put together caused them to make the recommendation over the weekend.

    Mr. LIPINSKI. One last question here, of the FAA people. Would a routine inspection ultimately have led to shutdown of ValuJet? A routine FAA inspection evaluation? Would you have ever come to shutting down ValuJet if you had not put on this special emphasis investigation?

    Mr. BRODERICK. It's obviously impossible to say what if. I can tell you that each of the things that were uncovered in the in-depth inspection program that we had going for 30 days were the kinds of things that, if you were at the right time with the right person with the right skills, you would find. It's just normal inspection findings.

    What is a big difference between what we did over that 30 day period and what is normal is the intensity of the inspection. We had an inspector for each airplane for a month. That's an awful lot of inspection.

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    Mr. LIPINSKI. Thank you.

    Ms. Schiavo, in the article that you wrote that appeared in a national magazine prior to the ValuJet crash, did you mention ValuJet in that article originally, or did you mention it after the crash occurred? Because I understand you rewrote it at the last minute.

    Ms. SCHIAVO. No. What happened was, it was written, and the final editing was done, I think it was about 11:40 in the morning, and we had talked about ValuJet, but it was edited after the crash and indicated the crash and used the name ValuJet.

    Mr. LIPINSKI. OK, so if the article that you wrote did not mention ValuJet until it was edited and rewritten after the crash occurred?

    Ms. SCHIAVO. No, there were three edits, and one was to add, or two were to add the name ValuJet and the third was to add the fact that the crash had occurred.

    Mr. LIPINSKI. Well, what I'm saying is that if the crash had not occurred and the article had come out, the article would not have mentioned ValuJet?

    Ms. SCHIAVO. It would not have named a name, that is correct.

    Mr. LIPINSKI. OK. Now, in that article and subsequently, in appearances before the news media, you have said that you wouldn't fly ValuJet, and there are other airlines that you wouldn't fly either. Don't you think that you owe it, based upon your accurate record with ValuJet, don't you think you owe it to the public to tell us who those other airlines are?
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    Ms. SCHIAVO. Given the fallout and given the unbelievable amount of, for example, from Senator Stevens I took from doing my job, and I happen to think, pretty darned good for 6 years, we have had a heck of a lot of uncovering, I wonder what would happen if I told the American people what I knew and what I thought about the rest of the airlines. Or, for example, which airline took off last night in the middle of the tornado warning. You know, I might tell them. I am not going to tell them, I am not going to name the names today. Maybe I will in the future.

    Maybe the public does deserve that. But it will——

    Mr. LIPINSKI. It certainly seems to me that the public does deserve it. I mean, maybe if you had mentioned ValuJet before, we wouldn't have lost 110 people.

    Ms. SCHIAVO. I did mention ValuJet before. On February 6, I had a meeting in my office, and we all said, and it wasn't just me, a lot of us said, we will not fly ValuJet. And we went to the FAA on February 7 and said, what are you going to do about it.

    Mr. LIPINSKI. Now, who did you go to in the FAA?

    Ms. SCHIAVO. My staff went to the Atlanta FSDO.

    Mr. LIPINSKI. Have you ever, based upon your very, very deep concern about ValuJet, have you ever gone directly to Mr. Hinson and told him about it, called him up on the telephone, went over to his office, asked him to come over and see you? Have you ever done that?
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    Ms. SCHIAVO. Mr. Hinson, no.

    Mr. LIPINSKI. Secretary Peña?

    Ms. SCHIAVO. I—because of the ongoing investigation, I am going to decline to answer that.

    Mr. LIPINSKI. Now, wait, what ongoing investigation are we talking about here?

    Ms. SCHIAVO. The investigation of ValuJet.

    Mr. LIPINSKI. By who?

    Ms. SCHIAVO. By my office. And by the way, I am recused. I am not leading that investigation. And the reason I am recused is because I am a witness. And I'm not going to go further than that.

    Mr. LIPINSKI. So you will say that you didn't tell Mr. Hinson about your concerns about Mr. ValuJet, but you won't say yes or no if you told Secretary Peña about it, is that correct?

    Ms. SCHIAVO. I am saying I will not go farther than that statement.
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    Mr. LIPINSKI. Well, it just seems to me that if you said you didn't see Mr. Hinson or talk to him about it, but you won't say anything about Secretary Peña, there must be a different answer there.

    And you have recused yourself from this investigation by your office of ValuJet, correct?

    Ms. SCHIAVO. That is correct.

    Mr. LIPINSKI. But aren't you rather selective in what you won't talk to this committee about, or what you won't talk to the news media about in regards to ValuJet? I mean, you did answer me about Mr. Hinson but you won't answer me about Secretary Peña. You have gone on television and you have made statements about the situation. It would seem to me that if you recused yourself and you want to be, let your office do the investigating, that you shouldn't be on the news media talking about it.

    Ms. SCHIAVO. That is because I have been very careful, and anything that's happened after the crash and concerning the investigation, I am simply not involved in. And that has why Mr. Zinser is sitting here, to advise me when I can not get into certain issues.

    But it concerns my——

    Mr. LIPINSKI. Is he here as your attorney or is he here as your assistant?
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    Ms. SCHIAVO. Mr. Zinser is the head of the investigation.

    Mr. LIPINSKI. Who have you told that, you say you recused yourself from the ValuJet investigation. Have you ever told Secretary Peña that?

    Ms. SCHIAVO. I recused myself in writing, where all the memos went from there, I recused myself in writing to the Deputy, and he took over from there, which is the proper way to do it.

    Mr. LIPINSKI. The Deputy IG's office?

    Ms. SCHIAVO. The Deputy Inspector General.

    Mr. LIPINSKI. Has the Deputy informed the—because actually you work directly for the President of the United States, right?

    Ms. SCHIAVO. Pardon?

    Mr. LIPINSKI. I mean, he appoints you, he can terminate your appointment?

    Ms. SCHIAVO. Yes, he can, sir.

    Mr. LIPINSKI. Have you informed the President of this?
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    Ms. SCHIAVO. Have I informed the President? No. I know I have had oral discussions with the Chief of Staff for the Secretary,and advised that I am recused. I did do it in writing and that is basically——

    Mr. LIPINSKI. You say you didn't do it in writing?

    Ms. SCHIAVO. I did.

    Mr. LIPINSKI. You did?

    Ms. SCHIAVO. Yes.

    Mr. LIPINSKI. And you have the document?

    Mr. ZINSER. Yes, actually the person that the Inspector General advised in writing was my supervisor, the Deputy Inspector General.


    Mr. ZINSER. And we do have copies of that memo. And I do not think that we advised the Secretary in writing, but the Inspector General has indicated she has advised the Secretary's Chief of Staff verbally. And I do believe——

    Mr. LIPINSKI. The Secretary of Transportation's Chief of Staff?
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    Mr. ZINSER. Correct.


    Mr. ZINSER. And I do believe that the Deputy Inspector General has advised the Administrator of the Inspector General's recusal.

    Mr. LIPINSKI. The Administrator is Mr. Hinson?

    Mr. ZINSER. Yes.

    Mr. LIPINSKI. Mr. Hinson, have you heard about this?

    Mr. HINSON. Yes, I'm aware of the IG's recusal.

    Mr. LIPINSKI. Mr. Chairman, obviously this panel has been here an enormously long period of time. There has been an awful lot of questions put to them. I really have many other questions that I would like to ask Ms. Schiavo in regards to this situation. And I will submit them to her, and I would appreciate it if we could get those answered as quickly as possible.

    But based upon the fact I'm way over my time, I thank you very much.

    Mr. DUNCAN. Ms. Schiavo, is Secretary Peña under investigation?
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    Ms. SCHIAVO. I can not answer that question. I am not leading the investigation.

    Mr. DUNCAN. Do you realize that by answering Mr. Lipinski's question about Administrator Hinson but not answering about Secretary Peña, you leave that implication?

    Ms. SCHIAVO. No, I do not leave that implication. I simply can not answer it because of other things that may have happened after there. There is no inference that you can draw from that. I simply can not get into it.

    [A supplemental statement from the Inspector General follows:]

    [Insert here.]

    Mr. DUNCAN. All right, thank you very much.

    I believe Mr. Oberstar has a couple more questions.

    Mr. OBERSTAR. Thank you, Mr. Chairman. I'll be very brief, because I concur, the panel has been on for a very long time.

    I want to come back to the February in-house report, February 14, what I referred to earlier in the day, and quote, the PTRS, that is, the problem tracking and reporting system date, also indicates that no structural inspections were accomplished on ValuJet's aircraft in 2 years. With the supplemental inspection document required by airworthiness directive 871407 to ensure continued structural integrity of an aging fleet of DC–9 aircraft, ASF300, that is the flight safety maintenance policy branch, believes this critical inspection was severely overlooked.
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    I authored that law. We did it to protect the public. We worked on this prior to and in the aftermath of Aloha that rocked the aviation world.

    Mr. Broderick, you have been in the forefront of insisting on compliance with that law and adherence to it. If this information did not get to your desk for you to act upon, it is in my judgment a damning statement about the process within FAA and the way in which information gets to those who need to make decisions. I'd like you to comment on that.

    Mr. BRODERICK. Thank you, Mr. Oberstar. In fact, that is a poorly written sentence or two, and it leads people to believe that maybe there were inspections relating to the aging aircraft program that were not done by ValuJet. And that's not correct. What in fact that reporter was trying to distill from the PTRS records was that he or she, and I don't know exactly who did the analysis, could not find evidence that the FAA had in fact done over the shoulder watching while ValuJet did the inspections.

    And the reason for the fact that FAA didn't do that is actually quite simple. It's a mistake. They should have done some heavy structural inspections during those years. But the office misunderstood the guidance that they were given and thought they were only to do those over the shoulder inspections on the aging aircraft program when an aging aircraft airworthiness directive was being carried out. And none of the aging aircraft airworthiness directives were due in that time period.

    So it's a little bit misleading and I apologize for the author's poor choice of words. It is not that inspections were not carried out. In fact, the inspections were carried out on the aircraft at that time. It was a criticism of the FAA.
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    Mr. OBERSTAR. Can you provide us with information about those inspections, what was conducted, and what was done in the course of conducting them and what the inspections found?

    Mr. BRODERICK. They were the normal inspections that were due for that airplane, but not any special aging aircraft inspections. The AD for the aging aircraft on those particular aircraft isn't due until 1997 or 1998, I think, 1997.

    Mr. OBERSTAR. You know how serious that matter is, and that's an issue of great concern for me, as are all these matters involving these aging aircraft that are required by new entrant carriers.

    Very briefly on another matter, ValuJet had no authorization to carry hazardous material, is that correct? ValuJet was the generator of hazardous material in the form of those oxygen canisters?

    Mr. BRODERICK. No, I wouldn't say ValuJet generated them. The aircraft that ValuJet operated had those canisters on it. And I suppose the generator was the person who took them off the airplane in the course of maintenance.

    Mr. OBERSTAR. The carrier, the aircraft owns the parts and owns the oxygen generators, and they are the responsibility of the carrier, and the oxygen generator, as a disposed item, is hazardous material. Management has to be held accountable as a generator.

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    But the disposal of it was provided for in the work card that accompanied that part of the work to be done on ValuJet by the contractor. My understanding is, when the passenger service unit was removed and the heat shield with it, the work card directed that the caps were to be put on the time expired generators a subcontractor to the contractor did that work, and that was not accomplished, and the packaging was not carried out in accordance with HAZMAT rules, which are not your responsibility, but the responsibility of RSPA and the Department of Transportation.

    Do you find a disconnect there?

    Mr. BRODERICK. It's certainly something that we and RSPA are looking into, and having discussions about literally daily.

    Mr. OBERSTAR. You need to address that matter decisively and quickly.

    Thank you very much, Mr. Chairman.

    Mr. DUNCAN. Thank you, Mr. Oberstar.

    I'm going to ask that all other members submit any additional questions or statements for the record, with two very, very brief exceptions.

    Mr. Bachus has one very brief statement, and Mr. DeFazio has one question.

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    Mr. Bachus.

    Mr. BACHUS. We haven't gone into hazardous materials, but I think that's been touched on. But I'm not going to get into that. But I would like to talk to you, ask something about repair shops. We know the airlines can't operate without them. We know from former testimony that the FAA regulations are good. But Mr. Hinson, are they being enforced?

    Mr. HINSON. Well, I think for the most part they are. Let me just make the point that we don't have any evidence, although the board hasn't ruled yet that there's absolutely any relationship between the accident and repair stations. I mean, in terms of the way they're regulated or anything.

    Mr. BACHUS. Well, we've had other incidents, even on ValuJet, where a plane burned that was——

    Mr. HINSON. Well, that has to do with the failure of an engine, internal engine turbine disk.

    Mr. BACHUS. We had another one where landing gear collapsed after it had been——

    Mr. HINSON. Yes.

    Mr. BACHUS. So we have had instances where repair shops were not even certified by the FAA, is that right? You know, when you look——
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    Mr. HINSON. I'm not aware of any work being done on ValuJet by non-certified maintenance.

    Mr. BACHUS. Is that right?

    Mr. HINSON. No, sir.

    Mr. BACHUS. How about the Turkish shop?

    Mr. HINSON. Except the x-rays we just talked about. Excuse me?

    Mr. BACHUS. Was that the Turkish repair shop?

    Mr. HINSON. No. Not that I'm aware.

    Mr. BACHUS. Let me ask you this. Are we enforcing those rules? Are you inspecting the repair shops?

    Mr. HINSON. We do that. We have a regular basis for doing that. I'll ask Mr. Broderick to explain that.

    Mr. BRODERICK. Yes, we do. We think we need to coordinate better the repair stations with the airlines. But yes, the repair stations are inspected independently by maintenance specialists in the FAA, as are the airlines.
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    Mr. BACHUS. OK, let me ask a final question. If ValuJet had a policy that they denied pay to pilots who did not complete their scheduled trips, is that a, does that reflect to you a lack of concern for safety?

    Mr. BRODERICK. I think the points that were raised in the February 29 letter which you may be referring to were satisfactorily answered by ValuJet later, to the satisfaction of the people in Atlanta with regard to that. I'm not a specialist in ValuJet's pay structure, but I think they will be testifying in the next panel, and you might ask them.

    Mr. BACHUS. Do you have an opinion on whether or not they should do that, whether that lessens safety?

    Mr. BRODERICK. Well, I mean, I don't think that ValuJet, from what the inspectors that know the program best tell me now, I don't think that ValuJet had in place a pay program that endangered safety. I think they did not, when they initially raised it, understand it fully. And when it was explained to them, they found it acceptable, to my understanding.

    Mr. DUNCAN. All right, thank you very much, Mr. Bachus.

    Mr. DeFazio.

    Mr. DEFAZIO. Thank you, Mr. Chairman. I appreciate the time.

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    To piggyback onto Mr. Oberstar's concerns about aging aircraft, do you have now in place or are you contemplating putting in place a special inspection program for planes that have been in foreign ownership and maintained overseas? The previous gentleman referred to the engine fire. It was a Turkish repair station that didn't meet FAA standards which had overhauled that engine.

    These are planes built in the United States of America, great planes, flown in this country until they were obsolete, sold to a Third World airline, maintained by a Third World airline in Third World conditions, and then purchased and brought back to the United States. What extraordinary scrutiny do we apply to those planes at that point in time? Is there any special program, or will you recommend one?

    Mr. HINSON. Mr. DeFazio, any airplane that's been operated outside of the continental United States by another sovereign, in another sovereign state by another air carrier, non-U.S. air carrier, when that airplane comes back into U.S. inventory, it must meet all of the current airworthiness standards of an airplane that is already within the United States inventory.

    And that creates in many cases big problems. Because we can't find the paperwork, the airline can't prove they did certain work. And in fact, often, they have to go in and overhaul an engine when there may not be any need to, because they don't have the paperwork to prove they did it the first time.

    So when an airplane comes back into our inventory, it must be proven to the FAA that it meets our standards. There are no exceptions.
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    Mr. DEFAZIO. And so when we're dealing with bogus parts, as raised by Ms. Schiavo and others, we basically, if they can't document anything on that plane, any critical component of that plane, they will have to replace that component before it's placed into passenger service?

    Mr. HINSON. That is correct.

    Mr. DEFAZIO. All right, thank you.

    Mr. DUNCAN. All right, thank you very much. And thank you for bearing with us. Thank you very much.

    And we will now call up the next panel. We have Mr. Lewis Jordan, who is the President of ValuJet Airlines; Mr. Steven D. Townes, who is President of SabreTech, Inc.; and Mr. Martin J. Bollinger, who is Vice President of Booz-Allen & Hamilton, Inc.

    Gentlemen, I know you just sat down, but would you stand once again and be sworn.

    [Witnesses sworn.]

    Mr. DUNCAN. You may be seated.

    We've had a request that Mr. Townes go first, Mr. Jordan second and Mr. Bollinger third. So that's fine with me.
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    Mr. Townes, you may begin your testimony.


    Mr. TOWNES. Good afternoon, sir.

    I've submitted a detailed written statement for the committee and ask that it be included for the record.

    Mr. DUNCAN. Your full statement will be included in the record, and that applies to all of you.

    Mr. TOWNES. Thank you, Mr. Chairman.

    I would have hoped to appear before you for the first time under different circumstances. But I'd like you to know that we very much respect and appreciate the leadership and critical roles of everyone on this committee, Chairman Shuster, Mr. Oberstar, who's not here right now but certainly integral, Chairman Duncan, Ranking Member Mr. Lipinski and others.

    As you had asked, I'll try to address issues today. We welcome the oversight and fully understand your need for constructive answers to tough questions. You have an abundance of facts in my written testimony with no mincing of words. So briefly, let me explain this.
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    A little over 6 months ago, I became the President of Phoenix-based SabreTech, one of the top 10 commercial aircraft maintenance and modification companies in the U.S. I lead 1,500 aviation professionals. We perform nearly 2 million manhours per year of technical services.

    Last June 30, SabreLiner purchased from DynCorp its DynAir Tech maintenance operations in Texas, Arizona and Florida. What is now SabreTech has been in the aircraft maintenance business for 43 years under various names. This past January, we undertook substantial management change, focused on continuous improvement of the newly acquired company.

    Mr. Chairman, we are painfully aware of the tremendous losses and hardships that have accompanied this tragedy, from the victims' families to the many dedicated and professional employees of ValuJet, SabreTech, the FAA, NTSB and many others. In particular, I know that this has been an extraordinarily difficult and tragic experience for the families and for ValuJet. I wish for ValuJet the very best as they renew their operations, which I know they will.

    We are all taking very difficult and painful lessons from this accident. This is an experience that must never, ever be repeated. We must examine every aspect of the accident and move swiftly to prevent a recurrence of this tragic thin line of human errors.

    Examining that thin line gives rise to what might very well be national imperatives. I've thoughtfully considered these issues and I have five recommendations today for your consideration.

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    First, without question, we must focus far more attention on the proper identification and handling of hazardous materials. The HAZMAT issue has not been given the attention it deserves. To its credit, the NTSB has issued the warning signs and the recommendations, but now we need a more failsafe system.

    We urge a joint FAA symposium and action oriented task force on hazardous materials in air transport, much like the approach that was used successfully to address the aging aircraft issue after the Aloha accident. I think this should be done very soon.

    Second, we believe the Government ought to consider recurrent training requirements to maintain the licenses of air frame and power plant mechanics, or A&Ps, as they're known. There should be a strong HAZMAT content added to their recurrent training. No recurrent certification rules exist for mechanics today like there are for pilots, for example.

    Given today's complex environment in the maintenance shop, it's time for the Government, I think, to consider mandating, and for myself and others in the industry to welcome, recurrent training and relicensing exams for the A&Ps. In fact, I'd take it a step further and have it apply to HAZMAT course syllabuses right in our vocational and technical colleges where they get their initial licensing. So all the thousands of young mechanics coming into the industry for the first time have that as their basic, licensed knowledge.

    Third, we welcome additional tough auditing from the FAA and from our airline customers. We agree wholeheartedly with the FAA's recent actions to require greater oversight and auditing for third party maintenance. Regular audits can only help to improve quality, and I urge more funding for the FAA's NASIP auditing program. I've undergone it. It's a constructive process. And as Ms. Schiavo said, it works very well.
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    We would, however, respectfully disagree with those who would use this tragic but isolated incident to condemn out-sourcing. Out-sourcing is a proven process, a safe process, and certainly not a new trend. Third party aircraft maintenance and modification industry represents $7 billion in annual revenue, 85,000 jobs and about 150 million manhours per year of technical services for airline and cargo operators.

    Whether independent or in-house, mechanics licensing is the same. Inspection requirements are the same. Repair stations are certificated the same by the FAA. The FAA assigns its own inspectors to every maintenance facility. And we're under the oversight of customers inspectors as well. The key is effective communication in the project management process between the airline and its contractor.

    Fourth and without question, we need to guarantee the safe air transport of oxygen generators and any other high strength oxidizer. We endorse the NTSB recommendation to permanently ban oxygen generators as cargo on passenger aircraft, unless effective fire detection and suppression systems are in those cargo holds.

    But more can be done. Today's system of sealing certain types of cargo holds to control fire simply is inadequate. Until safety can be assured, all high strength solid oxidizers should be banned from any cargo hold on a passenger aircraft.

    In addition, we urge that the DOT consider regulating these generators and any similar product as forbidden materials. This approach is presently employed by the DOT for a variety of products, including such things as cigarette lighters, whenever there's ignition capability.
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    Let me explain why. We've shared evidence with the NTSB and with the FAA and we'll be happy to share it with this committee that these generators can be accidentally discharged, even when secured by a shipping cap. That should worry everyone. It doesn't excuse or mitigate the thin line of errors that I described earlier, but it should worry us. The design of this or similar devices and their inner packaging should be examined by the DOT Bureau of Explosives and be specifically approved by RSPA.

    Fifth and finally, sir, from a human factors standpoint, we should consider much clearer labeling on all aircraft parts that may constitute hazardous materials at every stage in their life cycle: installation, use, and upon removal. Adoption of a HAZMAT labeling system for aircraft parts is going to definitely raise issues in my industry.

    But we believe a labeling requirement merits very serious consideration. In this case, the manufacturer of the oxygen generators that SabreTech handled for ValuJet began to place some warning labels on them in the mid–1980's after the DC–10 oxygen generator fire at O'Hare. The generators we removed from the ValuJet aircraft, however, were manufactured in the late 1970's and early 1980's, and to my knowledge, did not have any of the typical, large warning labels of the later models. Later models did say that they get hot, but there was no HAZMAT label as we know it.

    After this incident, even experts disagreed about whether oxygen generators should be transported as hazardous materials, full or empty. Why isn't it required that any aircraft part that may be hazardous material be clearly labeled as such, so that it's obvious to the average mechanic or clerk? We ought to consider making identification of aircraft parts that may be hazardous easier, by requiring the prominent placement of warnings. The mechanic should not have to guess.
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    Those are my recommendations. I'll turn very briefly to our response.

    We're committed to making sure that nothing like this can ever happen again, sir. First, we're conducting an extensive and exhaustive investigation of the facts. We're cooperating fully with all the investigating authorities.

    Second, our counsel has returned a leading hazardous materials expert to do a complete review of our hazardous materials identification, training and handling at each of our large facilities. He's recommending immediate changes that we're taking to further enhance and improve our HAZMAT policies and procedures. We've already conducted intensive back to back training sessions on HAZMAT for over 340 individuals in our Miami facility alone. We've also sent virtually all of our shipping and receiving folks to an intensive 3 day course on hazardous materials recognition, so they can spot the not so obvious.

    We have a new director of quality assurance and quality control for our company. We've transferred a Phoenix based quality expert to Miami to become director of quality there. We've hired a true technical leader from our industry to become senior vice president of technical operations back in February. They all have my complete confidence and authority to do what's right.

    And our parent company has established stringent environmental and safety disciplines for all its companies. Our goal is to go well beyond what is required and to try to do the right thing at all times.

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    Sir, my written statement contains detailed, straightforward recitations of the facts. So in the interest of time, because most of those relative facts have been widely reported in the press, I won't repeat them here. Am I comfortable with those facts? Absolutely not. However well intentioned, our performance in Miami did not meet the standards of excellence that I've set for this company, period.

    We'll continue to cooperate with all the authorities. It bears noting that the NTSB report and hearing has not been accomplished yet. We all want to know what happened and why, what could be done to prevent any recurrence. Our goal is to constructively present possible solutions. Our sympathy goes to the families, our prayers, and our support for our colleagues.

    To all of us here, I think we all should commit, never again. Thank you.

    Mr. DUNCAN. Thank you, Mr. Townes.

    Congressman Collins has been here with us all day and has requested that I call on him at this point. Mr. Collins?

    Mr. COLLINS OF GEORGIA. Thank you, Mr. Chairman.

    And it is good to visit back with the Aviation Subcommittee that I had the pleasure of serving on in my first term in Congress.

    I have the privilege of introducing to you and the other members of the committee Mr. Lewis Jordan, President of ValuJet Airlines at College Park, Georgia. Mr. Jordan is accompanied here today by many of the ValuJet employees, very dedicated employees.
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    Mr. Jordan lives in the third district of Georgia, as do many of his employees and also many of his customers. I've had quite a few conversations with Mr. Jordan just recently, and then also prior to the incident that happened in Florida.

    I must say that he has stepped up to the table, he's looking after his airline, and he's doing it in a manhood way. He could have fought the consent order, but he chose to agree with it. But fighting it would have been a long, drawn-out process in court. He wants to save his airline. He wants to save the jobs of many employees that work for him who are also former employees of a company called Eastern Airlines. He not only has found a niche in the market, but he's found a niche that has put a lot of people back to work who have suffered through this same type trauma before, and that was with the demise of Eastern Airlines.

    I commend him for his efforts, and I have full faith in him, that he will meet the consent order requirements and that ValuJet will be back in the air very, very soon, and they will be one of the safest airlines flying, if not the safest.

    Mr. Chairman, Lewis Jordan, President of ValuJet Airlines. Mr. Jordan.

    Mr. DUNCAN. Mr. Collins, thank you very much.

    Mr. Jordan, you may begin your testimony.

    Mr. JORDAN. Thank you, Congressman Collins.

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    Chairman Duncan, Chairman Shuster, members of the subcommittee.

    My name is Lewis Jordan, I'm here to represent the 4,000 people of ValuJet Airlines, most of whom have recently lost their jobs. I would like to begin by saying from everything I've heard here today, I would like to reiterate that the people of ValuJet are here to ask for a bipartisan effort. We don't believe that this is a political situation. We've had a tragedy. We're here to represent the millions of Americans who have told us they want affordable air travel, they want it safe, and we're committed, as Congressman Collins indicates, to complying with the consent order, and we'll talk about that later.

    This tragic accident in the Everglades has had a profound effect on everyone associated with ValuJet Airlines. For the last 6 weeks, we have lived with our lives centered around those who lost their lives in the tragic accident. We continue on a daily basis to extend our compassion and our sympathy and our prayers to all of them.

    We want to thank the subcommittee for last week acknowledging ValuJet's attempts to reach out to the families, to the NTSB for recognizing that our people went above and beyond in trying, as feeble as our attempts may have been, to console those who had lost loved ones. And I want to thank everyone who worked so hard in the severe conditions in the Everglades in assisting the NTSB in gathering the wreckage and assisting the medical examiner in gathering the human remains. It was terrible, terrible duty, and truly unsung American heroes fulfilled it with heroism.

    I wanted to begin by telling you that we had not come here today to get into a lot of detail about the oxygen generators. But in the last week or so, there's been so much confusion and misunderstanding about those, I felt compelled to at least bring forth, Mr. Chairman, one visual aid. We've talked a lot about boxes, we've talked a lot about hazardous materials markings. And with your permission, sir, I'll bring in two boxes, the approximate size of the boxes that held the oxygen generators that were boarded on our airplane. These are not intended to be identical replicas, but are very reasonable facsimiles of what we had and what we should have had.
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    If I could direct the subcommittee's attention to the box on my far left, your far right, you'll see a box with what has on it an ordinary COMAT sticker, company materials, like that that would be placed on a box that had ordinary nuts and bolts, completely benign hardware. The other box, Mr. Chairman, has on it the markings and labels that would be required to comply with the laws and the EPA regulations. And it is my simple and straightforward contention that had those boxes been so marked, ValuJet simply would not have accepted them. They never would have been on the airplane, and those 110 people would not have lost their lives.

    We think that any lack of understanding of that is not fair to First Officer Richard Hazen and Captain Candalyn Kubec, who lost their lives. And Mr. Chairman, if I may, I would just like to take a moment to introduce the mother of Captain Kubec, Ms. Marilyn Chamberlain, who is with us today in the back. We appreciate her being with us.

    Neither the NTSB nor the FAA has given any indication whatsoever that either pilot error, equipment failure, or maintenance factors played any role in this tragic accident. Indeed, it has been recognized that the crew reacted promptly and heroically. The NTSB has pointed to five boxes of oxygen generators, and we've talked about how they were packed, labeled and delivered. The boxes delivered looked like the one we showed you there with the plain COMAT sticker, absent the proper markings that would have had the right warnings to the people that would have accepted them.

    ValuJet does not permit the shipment of such generators on the aircraft, and we never would have accepted them if they had had the proper labels. It has already been determined that the safety caps were not installed, that the labels were not installed, that the generators were not disposed of properly, they were not discharged properly, and they were presented to ValuJet as empty. ValuJet had nothing to do with this, and we're sorry about the misunderstanding that has led up to the discussion of these items in the past.
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    I would like to move forward and talk about ValuJet's safety record, because candidly, there's been a great deal of confusion between the tragic accident and what was the cause of that accident, and all the other things that have been said about ValuJet, its training, its aging aircraft and its maintenance practices. I can state without doubt ValuJet is a safe airline. I will repeat: ValuJet is a safe airline. We can talk a lot about that. I know we don't have the time in detail today, but we certainly will be responding to your questions.

    I have a 33 year career in this industry. I'm an aerospace engineer by training and almost all of my career has been in operations and maintenance. I've served as the president of three airlines, including the world's largest air cargo airline and one of the major carriers in the United States, before becoming a cofounder at ValuJet.

    I would have grounded this fleet myself if I had had any reason to believe that the airplanes were not safe. The safety of our customers is our No. 1 priority and far and away ahead of any other priority. I simply do not understand the logic of those who think that running an unsafe airline could ever contribute to profitability, could ever contribute to marketing an airline in the public's eye.

    ValuJet has undergone an unprecedented series of inspections. It's been said repeatedly, the Administrator himself indicated, we had 4 years worth of inspections in a 4-week period. I cannot possibly tell you exactly what would have been found at other airlines under a similar level of inspection. And I have refused to speculate from the beginning. But it is my honest opinion that because we have no basis for comparison, ValuJet has been misrepresented to the public. And I think that is a grave miscarriage of justice.
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    To have the same level of inspection as has been pointed out that we had, would have required 500 or 600 inspectors for 30 days, night and day, crawling all over whatever may be your favorite airline. As Chairman Shuster noted in last week's hearing, it's likely that many of the writeups that were seen would be found on any airline with similar scrutiny.

    I want to acknowledge right up front some of these writeups point up to us some very real deficiencies and discrepancies, and we are committed to dealing with each and every one of those, both with corrective actions and preventive actions. The question has been asked as to whether the FAA was too severe on ValuJet, and I want to say, as Congressman Collins acknowledged, I've told him, we're putting that question behind us.

    We are committed to going forward. We are committed to building back ValuJet Airlines as the new ValuJet, and we want it to be the safest airline in the skies. I owe it to the 4,000 good people who make their career at ValuJet to do that as fast as possible, and we will be presenting a schedule very, very soon to the FAA on how we will comply with the consent order, item by item. And we will present quality documentation to them, and ample evidence that ValuJet should be allowed to fly again, and again soon.

    We would ask, and we would hope, that we would get a similar amount of attention and energy and effort into helping us get back into the sky as we got in the unprecedented level of inspection that led to our shutdown. We are particularly concerned. We have been cooperating with the FAA completely, and we will continue to do so. But we were concerned that at the time we were presented the information, we weren't given time to respond. And we will deal with that at another time.
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    Leading aviation experts agree that the incidents cited about ValuJet really should not have shut down this airline. We talked earlier about a report from AvMark that's led by Ms. Barbara Beyer, who's also in the audience today—Ms. Beyer, I just wanted to recognize you—who has stated that these incidents cited by the FAA happen at all airlines. And in fact, Jeffrey Shane, former Assistant Secretary of DOT in International Policy, indicated that he had come to the same conclusion, that there was not enough evidence here to shut ValuJet down.

    But again, our emphasis and effort is on getting ValuJet back up as soon as we possibly can.

    How does ValuJet offer its lower fares over and over and over again? There's been an accusation that lower fares mean lower safety. That is patently false. And because of the time constraints on the subcommittee today, I will not go into detail here. But I will offer myself at any time you would like to go into detail on the things ValuJet does to save money. It is not safety. It is not regulatory compliance. We cut frills. We don't ever cut safety. We will never cut safety at ValuJet Airlines. In fact, we will spend whatever it takes to provide the highest level of safety.

    Concerning the age of the fleet, I think it's important to point out that over and over again, ValuJet's aged fleet is pointed out. In fact, we only operate 4 percent of the airplane seats of planes 20 years or older. The DC–9s we fly are actually a smaller fleet than those operated by many of the big carriers. Today, for example, there are a total of 137 DC–9–30's among TWA, Continental and US Air. Northwest alone has 107 of these airplanes.
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    And I have included in my testimony that was submitted for the record, Mr. Chairman, a statement from MIT statistics professor Arnold Barnett who really goes a long way toward pointing out how some of the interpretation of the accident rates can easily be misinterpreted. Where, for example, turbulence on an airplane caused a flight attendant standing in a galley to have a broken ankle, that is one accident, just like an airplane where the flaps were not set and there was a tragic crash that took the lives of people on board.

    The lower fare airlines are safe, no frills travel offered at an affordable price. They enable people who otherwise could not fly to travel. I don't have the time today to outline all the folks who have thanked us for the opportunity to travel when they couldn't otherwise have afforded it.

    ValuJet customers are families, the elderly, students, and small business people. The proof of our success is that with our shutdown, airfares are increasing every day.

    Quickly, I'll reiterate that I appointed General J.B. Davis as ValuJet's safety czar to provide oversight, without limitation, and to look at anything and everything it takes so he can give his blue ribbon seal of approval to the Congress, to the FAA, to the NTSB, that ValuJet is absolutely safe. General Davis has said, I would not fly on an unsafe airline. I have flown ValuJet several times since the accident. My family has flown on ValuJet. We will implement his recommendations.

    I won't go into details in the interest of time, but specifically today, we have recognized General Davis' No. 1 recommendation, and that is the appointment of a senior vice president of maintenance and engineering, reporting directly to me as the president of the company. And we'll be announcing the named individual in the near future.
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    We will revise our entire maintenance organization to address some of the recommendations General Davis has made that he believes will help us do a better job in complying with the consent order and going forward.

    How can you be sure if we're safe? It's been mentioned earlier today that maybe it's time that the DOT include in its reporting not just the mishandled bags and not just the situation where customers complain, and not just the on-time performance. I will say, as the most inspected airline in the world, and since all of our results have been printed anyway, we welcome them to be printed in any forum where you'd like to see them. I think the traveling public has a right to choose, and I believe when they see our record as compared to other records, and when they see what we have to offer and our commitment to safety that we will do very, very well in the business world.

    Again on behalf of our 4,000 unemployed workers, I think as a matter of simple fairness, I ask the Congress to urge the FAA to assist us in getting back up in a timely fashion. We don't ask for anything except safety. We will prove it, and we ask for the help in going forward. Safety first, culture is not a matter. I can spend a lot of time talking about at least four misperceptions I heard. The issue on the pay was absolutely wrong. We pay when a pilot does a return. And I won't go into detail unless you want to question me on that.

    I will say that the country needs good, safe, low-cost air travel. I will point out that even since our accident, while we were cut in half, 285,000 people chose to fly on us.

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    I will close, Mr. Chairman, by again saying, I cannot understand the logic of how anyone could think the president of an airline would choose to do anything other than be the safest it could possibly be.

    Thank you.

    Mr. DUNCAN. Thank you very much, Mr. Jordan.

    Mr. Bollinger, you may begin your testimony.

    Mr. BOLLINGER. Thank you. My name is Martin Bollinger. I am a vice president with Booz-Allen and Hamilton. We're a management and technology consulting firm and we were engaged by the FAA Administrator in the summer of 1995 to undertake a long-term review of the FAA's approach to certification and regulation. It supported the Challenge 2000 Initiative.

    The objective of our engagement was to propose a vision of how the FAA should operate in the future in these areas in order to accommodate the challenge of a constrained fiscal environment, a rapidly changing aircraft and airline industry, and the need to drive the accident rate down further to zero. Our review was completed in April 1996, about a month before the ValuJet accident. So it is important to understand that we did not conduct this assessment in the context of the ValuJet accident.

    Our recommendations and findings in April 1996, this April, were as follows. First, by any relative or absolute measure, air travel in this country is phenomenally safe and it has been for a long time. Nonetheless, there are opportunities to improve the execution of the current regulation and certification system. However, that was not our charter. There's been a lot of work done by others looking at that issue. Ours was to question whether that system was the most appropriate system going forward.
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    Second, while air travel remains relatively safe, after years of declining accident rates for the last five or 8 years, the rate has plateaued at a very low level. The simple math of the situation is that if the rate doesn't change and air traffic doubles, we're going to have twice as many accidents as we do today. That's math. In our judgment, the current regulatory system wouldn't achieve the administrator's goal of zero accidents. You're pretty much tapped out how you can optimize the current system.

    Looking forward, the environment being regulated by the FAA has changed, and will change, considerably. Let's go back to the way things were when the FAA was formed in the late 1950's and early 1960's. It was a national industry in the United States that was serving people in the U.S. for the most part. That's not true any more. There are whole classes of aircraft for passenger use that are not built in this country. It was an industry operating with the new technology—jet-powered air transport aircraft—that was relatively new. It is no longer new. It is a very mature and well-understood technology foundation. Air travel in the U.S. was growing very rapidly. It is still growing rapidly but it is growing faster overseas.

    Perhaps the most significant change though was with the nature of the airlines. If you go back ten, twenty years, you had a group of large air carriers that carried the bulk of air passengers. That still is the case. In fact, the percentage of passengers carried by the largest airlines is increased over the last ten, fifteen years. Those older, larger carriers operated with firmly established safety programs that in many cases ensure performance well above baseline standards. However, we projected that there would still continue to be a churn of new entrants into the air transport system that have less well-established safety programs—that's important; I didn't say less safe or more safe, just less well-established—and we felt that would require disproportionate attention from the FAA. We also felt this could challenge the conventional approach of the FAA's organization and how they deploy their resources.
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    Another finding was that the current approach to regulation and certification is very costly, both to the Government and the industry. And that while in a fiscally constrained environment you may see productivity improvements that close the gap, in our judgment that would not be sufficient.

    Therefore, we're confronted with three factors. You have a radically different aviation environment than that which forms the basis of the current regulatory and certification approach, we have constrained financial resources, and we have an imperative to drive the accident rate down again after it has plateaued. In our judgment, the current system, no matter how well executed, would not simultaneously accomplish those three things.

    Therefore, we made a recommendation that a new framework be adopted. That has four elements to it. This is the Challenge 2000 recommendations you've heard mentioned a few times today. The first, and perhaps the most important in the current context, is to shift the role between FAA and industry, in which the FAA takes a greater role in defining higher standards of performance in areas that relate to safety, built around demonstrated best practices in the industry, and in which the FAA actively helps participants in the system achieve those higher standards of performance. You would redeploy resources away from the carriers and other participants that exceed baseline standards, and deploy toward those that fall short of the best practices.

    Second, we suggested reorganizing the resources within the FAA part we're talking about so that they're managed centrally rather than through a regional hierarchy. We also suggested a major upgrade of the quality and training of the inspection workforce including adding 300 to 400 additional national resource specialists, up from about 10 today.
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    The other two recommendations were to streamline the rulemaking process, and, last, to reengineer the day-to-day operations of the FAA to reduce the administrative burden and cost and to improve the processes.

    It is important to note that many of these changes that we recommend are reflected in programs currently in process at the FAA. Our judgment though was that, even in aggregate, they don't represent the kind of restructuring that's embedded in the four recommendations I've discussed. These are all good initiatives but they tend to be layered on top of the current regulatory system. In our view, the challenge for the FAA is to make these discreet initiatives currently underway part of a broader restructuring of the entire approach to regulation and certification of the aviation system.

    In summary, the basis behind the current approach to regulation and certification has its origin in the challenges facing a national, highly regulated, including economically regulated, airline industry in the 1950's and 1960's. It has proven highly successful and it is the model for the rest of the world. Nonetheless, sufficient change has occurred, and will occur, that in concert with the need to drive the rates down to zero and in a fiscally constrained environment, in our conclusion, a new framework was warranted. Thank you.

    Mr. DUNCAN. Thank you very much, Mr. Bollinger.

    We will go first for questions to Chairman Shuster.

    Mr. SHUSTER. Thank you very much, Mr. Chairman. We appreciate the testimony. When were you notified, Mr. Jordan, that ValuJet would be grounded?
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    Mr. JORDAN. Monday, 1 week ago, I was working away from the office, I received a phone call approximately 1 in the afternoon that day, sir, and I was asked to come to a meeting to be held at ValuJet's headquarters at approximately 2. It was at my request that there was a slight delay because I thought it would be difficult to get there. We scheduled the meeting for 2:30 at ValuJet offices on Monday afternoon. At that time, I was informed that we either would shut down voluntarily or be shut down.

    Mr. SHUSTER. Were there any negotiations between ValuJet and the FAA with regard to the shutdown or the consent decree?

    Mr. JORDAN. Mr. Chairman, we had been in active negotiations with the FAA and we had actually proposed a reduced operating plan that would have allowed ValuJet to operate not 51 airplanes, but 37 airplanes and 20 lines of flying. The FAA had negotiated with us on that and had, in fact, indicated at the level of the top people in the Southern Region that it looked favorable to them, they believed they could approve it. We hoped to have our operations specifications modified, revised on Thursday or Friday of the week before. We were told on Thursday that it was not going to be possible. So the negotiations ceased while they reviewed our input. And the only negotiation that really occurred the day we were told was a discussion as how this would actually occur and did we have any opportunity for appeal. We were told no because this was being done under emergency procedures.

    Mr. SHUSTER. Who do you believe made the decision to shut you down?

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    Mr. JORDAN. I really don't know, Mr. Chairman. I only know that I had strong indication from the people in the Southern Region that things were moving along and that we believed we had the opportunity to have the revised plan to operate at a lower level. I was informed that the review that Mr. Broderick described earlier that took place of the data over the weekend was going to be taking place. The people in the Southern Region told us that actually two officials came down from Washington to go through that information. So I don't know and I really won't speculate.

    Mr. SHUSTER. Let me back up a minute. If I understood you correctly, you said that you were given indications from the Southern Region that you were going to be able to work out continued operation.

    Mr. JORDAN. That is correct.

    Mr. SHUSTER. When were you given those indications?

    Mr. JORDAN. I believe the exact day was the Wednesday of that week prior to our shutdown the following Monday. And as Mr. Broderick testified, on Wednesday it looked like we were going to have that approval and by Thursday things had changed.

    Mr. SHUSTER. And that was from the Southern Region. But I think I heard you say a moment ago that the Southern Region told you that somebody from Washington was coming down to review the data.

    Mr. JORDAN. Yes, sir. The Southern Region had, as you know, the 2,000-plus inspection results and they were compiling those. I was told that Mr. White and Mr. Acardie of the FAA Washington office would be flying into Atlanta to go through those data and review them with the people in the Southern Region. That implied to me that they were being reviewed at the Washington level, but I have no basis for any knowledge specifically on that.
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    Mr. SHUSTER. Do you believe that the decision to shut you down was made after the Washington gentlemen you mentioned arrived in the Southern Region and reviewed the data?

    Mr. JORDAN. From every indication I had from every individual that I talked to in the FAA, I believed that all through the week. Thursday, it looked a little more doubtful. We were very concerned that the Wall Street Journal ran an article that had leaked the entire detail of what we thought was going to be the revised ValuJet plan. That was very concerning to us. On Friday I continued to believe we had an opportunity to go forward with that plan but I was advised that we would not get our answer on Friday as we had hoped. I was advised that it would be Sunday night or Monday before I would hear. So I had to conclude that the input of the gentlemen from Washington in reviewing the data on Saturday and Sunday was a factor.

    Mr. SHUSTER. Are you suggesting that the information that was leaked to the news media was a basis or a reason for changing direction?

    Mr. JORDAN. I'm not suggesting that at all. I'm telling you that because we were in what I considered to be confidential negotiations and I thought we were very close to working out an arrangement at a local level, I was disappointed to see something that put our entire negotiation in the newspapers. I didn't mean to imply anything on that.

    Mr. SHUSTER. My time is up, but one final question. Who do you believe leaked the information to the news media?

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    Mr. JORDAN. I have no idea, sir, I wish I did.

    Mr. SHUSTER. Did it come from ValuJet?

    Mr. JORDAN. No, sir.

    Mr. SHUSTER. Thank you.

    Mr. DUNCAN. Thank you very much, Chairman Shuster. Mr. Costello.

    Mr. COSTELLO. Mr. Chairman, thank you. Mr. Jordan, it is your testimony that the boxes were improperly marked. Is that correct?

    Mr. JORDAN. That is correct.

    Mr. COSTELLO. Who were the boxes marked by? SabreTech?

    Mr. JORDAN. The boxes were not marked is the primary point that I'm making regarding the proper markings for hazardous materials. I don't know exactly how the COMAT label was put on there at the moment. That's all part of the NTSB investigation. But the point I wanted to make is that the proper markings would have kept ValuJet from ever putting the boxes on the airplane.

    Mr. COSTELLO. And whose responsibility was it to make sure that the boxes were marked properly?
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    Mr. JORDAN. It is my belief and my understanding, and, by the way, we will run out of my specific knowledge on this subject pretty quickly, I do have an attorney with me who can answer specific questions about the details, but it is my understanding that SabreTech, as the company that removed these generators in accordance with the maintenance manual, was required to cap them, discharge them, dispose of them, and see that they were properly packaged and labelled.

    Mr. COSTELLO. So it is your position that if the boxes were not properly labelled, that mistake, that error was made by SabreTech.

    Mr. JORDAN. That is my position.

    Mr. COSTELLO. Is it your position that it is ValuJet's responsibility or the outside maintenance contractor's responsibility to make sure that all FAA regulations are complied with?

    Mr. JORDAN. It is a shared responsibility. The agency, as an FAA certificated agency, has responsibility to comply with all of the regulations. ValuJet certainly has oversight responsibility, as do all the big airlines who use these kinds of agencies out there, and it is also shared with the FAA.

    Mr. COSTELLO. So if there is either cargo or packages loaded on a ValuJet airplane, it is your position that it is shared responsibility, not the responsibility of ValuJet to know exactly what is contained in those packages?
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    Mr. JORDAN. I understood your question to be in regard to specific maintenance work within the walls of a SabreTech, for example. From the time that those items were put in boxes, sealed up, and labelled with plain, ordinary COMAT labels, then a shipping ticket was filled out and delivered with those to the airport to ValuJet. At that point, we had an employee who took them, looked at them, took the shipping ticket to review with our First Officer to be sure that everything appeared to be in order, and the labeling specifically had the word ''empty'' on it. Empty canister would signal to an airline employee that those are items that are normal, routine, benign hardware parts.

    Mr. COSTELLO. And that ticket was filled out by an employee of SabreTech?

    Mr. JORDAN. That is correct.

    Mr. COSTELLO. ValuJet does not have the authority to transport hazardous material; is that correct?

    Mr. JORDAN. That is correct, sir.

    Mr. COSTELLO. I understand that ValuJet's standard practice on dangerous goods shipping procedures adopted in April 1996 states, ''In order to keep ValuJet aircraft in an air worthy condition and in compliance with regulations, some aircraft equipment considered dangerous goods must routinely be shipped between stations.'' Is that, in fact, a policy that ValuJet has adopted and issued in April 1996?
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    Mr. JORDAN. That is my understanding, yes, sir.

    Mr. COSTELLO. Isn't that in conflict with the fact that you are not authorized to transport hazardous material?

    Mr. JORDAN. Perhaps I didn't make clear, I should have pointed out that there is an exception under the Federal regulations and under our manuals that allow us to transport certain items under certain conditions. However, under no circumstances are we ever allowed to transport the oxygen generators. The kinds of things that are considered to be hazardous materials and the kinds of things that are considered to be potentially dangerous under some circumstances, such as batteries and partially inflated tires and those kinds of things, we have specific exemptions for.

    Mr. COSTELLO. So it is your testimony that had the boxes been properly marked you couldn't have transported those packages. Is that correct?

    Mr. JORDAN. That is correct.

    Mr. COSTELLO. The red light is on, but let me ask two quick questions, if I may, of Mr. Townes. You have heard the testimony of Mr. Jordan about the improper marking of the boxes. What is your response to that?

    Mr. TOWNES. I won't minimize the obvious error of the word ''empty'' on the shipping ticket. We've seen it. We've all seen it. If we look just to the facts and the four corners of the document which has been widely portrayed in the press, I needn't try to refute what it says. The error that was made was in marking it ''empty'' when they weren't all empty.
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    But what I would like to speak to is the difference between us shipping things like we normally do, handling dangerous goods like we do with outside dangerous goods certified contractors, and handling COMAT. With absolute full respect to my colleague, Mr. Jordan, COMAT is outside the system. As Mr. Oberstar accurately pointed out, equipment comes off of an airplane, goes into a customer lock-up, is returned eventually along with many other shipments in the normal course of doing business. That's how COMAT works. I am not an airline executive, but I think if you asked many airline executives they would probably confirm that. That doesn't relieve us of the shared responsibility that Lewis referred to. But it does highlight the need for improvement and reform that I talked about in my opening comments.

    Mr. COSTELLO. Mr. Townes, how did SabreTech come into possession of these canisters?

    Mr. TOWNES. Well, the canisters were part of the work that we performed on MD–80 aircraft that were coming through for heavy maintenance and some modifications. If I could walk you through the human factors involved with the removal and replacement of those canisters, you might get a better understanding of the work flow and the circumstances involved with what I'll call the tragic, thin chain of events.

    Picture yourself as a mechanic and we're in the airplane on an MD–80. You're removing and replacing the oxygen generators in the overhead passenger service unit. You might assume, OK, I'm going to pull one out of the passenger service unit, I've got a new one here, I'll take the safety cap off of the new one and put it on the old one, set it over here, reinstall. But that's not the case. The actual work flow in typical management of a project like this is all the passenger service units come down, go to work tables, those out of shelf life 12 years old or order oxygen generators are removed and boxed. They are not boxed with 12 year old spare shipping caps. They are put over here. Weeks later, hundreds of man hours later, and indeed hundreds of yards later in the process, those canisters have made their way through the logistics pipeline back toward the shipping dock just like all company owned material that came off this customer's airplane. As I said, weeks later, new canisters arrive, the exact number ordered of course for how many needed to be replaced. Now the mechanic goes to that passenger service unit and installs the oxygen generator, does a drop test for the masks to make sure that everything is in there properly, and only then do they carefully put those masks back up inside and remove the shipping cap, and then close the passenger service unit. You can see the distance of time and activity between the company owned material generators heading toward the shipping dock from the work tables and the reinstallation of the new generators.
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    The error that was made is that our shipping clerk saw green tags as being unserviceable on those generators as they came down that logistics pipeline and he erroneously thought that meant empty. And that is one of the small human errors that I talked about in my opening comments. If I could, sir, that's what I mean when I say we need a complete industry-wide task force on the identification and proper recognition in terms of training for the not so obvious hazardous materials that can come down that logistics pipeline in any repair station. They weren't properly labelled in the sense that while some were empty, others were full. But, of course, the ticket clearly identified the items as oxygen canisters, which empty or full can only be shipped as hazardous materials. I understand that ValuJet's own Hazmat training manual alternatively identifies such items as a ''common hidden hazard'' that should ''arouse your curiosity.'' ValuJet had no authority to carry such items, and should not have put them on board its aircraft. They were old and those old models didn't have the new style labels.

    Mr. COSTELLO. The last question that I have, did the work order that you received from ValuJet specify that the generators were to be safety capped?

    Mr. TOWNES. The work order stated that shipping caps should be placed on unitiated generators, but that same work order gave no instructions as to the discharge or disposal of the generators. I have a copy of it right here. It is work order No. 69 off 802 Victor, Victor, one of the airplanes in question. In fact, it does state that shipping caps should be reinstalled as part of the removal process. And as you have seen widely reported, there was an unfortunate signing off and, hence, probable misrepresentation on the part of two contractor mechanics on that work card stating that they had reinstalled the shipping caps and, in fact, they had not.
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    I think in good faith they tried to achieve equivalent safety. They cut the lanyards, they wrapped the lanyard string around the post of the oxygen generator, and I believe the taped all or most of them over. That's the way they look when they arrive in a new box. And, again, the same pipeline of activity took it toward the shipping dock. Nothing can forgive those two people for making a misrepresentation. Nothing allows false statements. We don't condone it; nobody should. It can't happen, but it did. So, in fact, those shipping caps were not put on.

    Mr. GEREN. Mr. Chairman, could I just ask a clarification of a statement he made?

    Mr. DUNCAN. I'm getting ready to, Mr. Geren. I think we'll clear up some things here. Thank you, Mr. Costello.

    Mr. Townes, I heard you say that you don't want to minimize the error. But it sounded to me like Mr. Jordan said that this accident would not have occurred if that box had been properly labelled. That seems to me that he is saying that this accident was your fault in plain language. You say shared responsibility. Do you think this accident would have happened if your employee had labelled the box correctly?

    Mr. TOWNES. Well, I've asked myself that many times, Mr. Duncan, and I don't think any of us here can answer that fully until the NTSB is finished with their investigation. I am not a lawyer. I am not sure this is the right place to adjudicate complex legal issues. But given the events that occurred and the tragedy that occurred, the one thing I did commit myself today to do was to try to call for action that would make sure that this would never happen again. That's the best way I can answer you today. Insofar as responsibility is concerned. I would tend to agree with ValuJet's own hazmat training manual, which states: ''It is the Airline Representative's responsibility to know the contents of air freight and combat shipments tendered for shipment and to determine the acceptability of such commodities.''
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    Mr. DUNCAN. And the mechanics that you're talking about who failed to put the safety caps on or gave misinformation about that, were those employees of SabreTech or was that a company that SabreTech had contracted with?

    Mr. TOWNES. They were employees of two separate companies. One was a contractor with one company and one was a contractor with another company.

    Mr. DUNCAN. And what companies were those?

    Mr. TOWNES. Those two companies were PDS and STS, well- known contract suppliers in our industry segment.

    Mr. DUNCAN. Had SabreTech ever had any violations like this before?

    Mr. TOWNES. To the best of my knowledge, no. There had, in fact, been some small violations in the summer months of 1995 but they had to do with our telecommunications business unit and not having to do with airworthiness incidents.

    Mr. DUNCAN. Has your employee explained why he wrote ''empty'' on the shipping ticket for the canisters when the canisters were in fact full?

    Mr. TOWNES. Yes, he has.

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    Mr. DUNCAN. What has he told you in that regard?

    Mr. TOWNES. What he has said is he thought he was doing it right. They were green tagged, marked as unserviceable. He made an apparently erroneous assumption that they were empty. He wrote ''empty'' on the ticket. The ticket does, in fact, speak for itself. It is part of that COMAT flow that I described earlier. It was delivered by a second employee over to the cargo ramp area of ValuJet. That's where it left our custody and I have no knowledge of what happened after that.

    Mr. DUNCAN. Do you not feel it is at least attempting to pass the buck to say that there should be industry-wide standards, as if that in some way absolves you from blame for this incident?

    Mr. TOWNES. Not at all, sir. When the final analysis is done and the responsibilities are being assessed, we will stand up to whatever responsibilities are in fact assessed. Nevertheless, I do think this is a proper forum to talk about the broader issues that this does raise. That's what you wanted me to do in this testimony and I have tried to do that, sir.

    Mr. DUNCAN. When you say shared responsibility, what do you think ValuJet did in this situation that they shouldn't have done? What did they fail to do? Were you talking about shared responsibilities with ValuJet or with these other companies?

    Mr. TOWNES. Well, I think there are a lot of complex legal issues there, sir. I really choose not to try to adjudicate complex law, not being a lawyer and not having all the facts from the NTSB investigation. I am absolutely committed not to use this forum to turn into a blame lobbing session.
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    Mr. DUNCAN. Thank you very much for your frankness. Mr. Jordan, before my time runs out, let me ask you one question. You stated at the very last of your testimony that you had heard four misconceptions here about ValuJet and you started to mention one about the pay of the pilots. What are those four misconceptions and what is your position in regard to those?

    Mr. JORDAN. Mr. Chairman, they are relatively minor but they imply much more significant things. We had a landing gear failure in Nashville. It is under investigation from McDonnell-Douglas. The metallurgical analysis has been ongoing for quite some time. Neither the NTSB nor McDonnell-Douglas has been able to determine what caused that failure. It is the type of failure that has occurred on a number of different airlines at times. I heard it today described as a ''hard landing.'' It was, in fact, a normal, routine smooth landing with a gear failure.

    We heard about x-ray inspections today. I think it came across as a misunderstanding that the same two people who had been doing the x-ray inspections for a licensed agency went across the street, hung out their own shingle, continued to do the work. We re-x-rayed every one of the airplanes and found them all to be OK. I just didn't believe that came across very well.

    There was discussion about our going off a runway when we were the only airline operating out there in the snow. As a matter of fact, it was a very difficult day when in this fine city cars were running into each other all over town, we were on a taxiway that was covered with snow and ice attempting to taxi when the nose wheel went off into the snow and it was not a case where we ran off the runway. Minor differences but I think the subtlety is important.
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    Mr. DUNCAN. Do you think, sir, that today you would have been treated differently if your airline was an older, more well-established, much larger airline? If you were heading up a much larger, much more established airline, do you think you would have been shut down?

    Mr. JORDAN. I cannot imagine that I would have even gotten anywhere near the same amount of attention. I can only compare to what I've seen in this business over thirty years. I cannot explain, Mr. Chairman, what has gone on with the news media, with everything that has occurred here, the unprecedented level of inspection. I am, quite frankly, very baffled by what has happened. But, again, we're committed to the knowledge that we did sign the consent order, we are grounded, and we will do what we can to get back up.

    Mr. DUNCAN. My time is up. Thank you very much. Mr. Oberstar.

    Mr. OBERSTAR. Thank you, Mr. Chairman. Mr. Jordan, in your responses to Chairman Shuster, you seemed to believe that the recommendation to Administrator Hinson to ground ValuJet was influenced by flight standard officials from Washington. If your suspicions are correct, then I'm wondering, in your opinion, whether there's anything wrong with officials from the Washington office that oversees aviation safety, if there's anything wrong with those officials playing a role in the recommendation?

    Mr. JORDAN. No, sir. I think that if I implied suspicion, that was not my intent. I thought I was asked specifically what had happened and how I thought the decision may have been made. I found it unusual that the decision was made at the local level by the local people but yet the Washington people spent Saturday and Sunday in town looking at everything. I assume they made comments and recommendations and played a part. I didn't find that unusual, I didn't find that out of the ordinary, I didn't find that anything untoward. I did find it out of step with where I thought we had an agreement earlier in the week with the Southern Region where I was told they had the authority to speak on behalf of the FAA.
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    Mr. OBERSTAR. Had Washington Flight Standards Office come to a different conclusion and overruled a recommendation from the field, would that be improper or inappropriate?

    Mr. JORDAN. Mr. Oberstar, I will say to you that I never meant to imply that whether they ruled for me or against me that it was improper. I like it when they rule for me much better.

    Mr. OBERSTAR. I think it is important to clarify the role of the Washington Flight Standards Office. They have the role of affirming or overturning recommendations of the field offices and that's why you have the headquarters offices. There is a need for national uniformity on issues of sanctions and issues of actions and that's supposed to be their role.

    Mr. JORDAN. Yes, sir.

    Mr. OBERSTAR. I just wanted to clarify that. I was getting a different impression. In the acquisition of your fleet, moving from two aircraft to fifty-one in 3 years, you grew very, very fast without having an in-house maintenance capability. In hindsight, would you have grown that fast if you knew the problems you were going to experience along the line? I say that to you in your role as a person long experienced in aviation. You served with the Flying Tigers, one of the most celebrated cargo carriers in American history. You've had a long career in aviation. Do you think that was a good road to follow?

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    Mr. JORDAN. Every step of the way we were asked about our rate of growth. Congressman, if I could determine that the rate of growth contributed to this accident or contributed to any deterioration in our level of safety, and your question, if I could in retrospect look at it, then I would change it. But I will say we looked at a number of things in the industry. UPS is a cargo airline but they grew much faster than ValuJet Airlines, but they have to be held to the same standards because cargo airlines can crash into a school house and it is a very serious matter, as you well know. We found that growth alone, as long as we watched the factors that we were supposed to watch, was not in and of itself a problem.

    Mr. OBERSTAR. You felt from a safety standpoint that the rate of growth could be accommodated by the maintenance contracts you had with outside maintenance providers; is that your judgment? You made those evaluations periodically and concluded that you could sustain the growth with the maintenance program you had?

    Mr. JORDAN. Congressman, we have agreed with the FAA to narrow the number of agencies. But as far as the concept of using contract agencies themselves, as you well know, Southwest Airlines has the best safety record in the industry over the last twenty-five years and they have always out-sourced their heavy maintenance. We didn't find anything wrong with that in and of itself.

    Mr. OBERSTAR. I'm not criticizing out-sourcing the maintenance as such. What I do question is the rate of growth that ValuJet experienced either caused you or accommodated a policy of contracting out to many maintenance providers. I have visited virtually every major maintenance facility of major airlines in this country, every aircraft manufacturer in the United States, have been through D-checks, C-checks, ramp checks, I've talked to line mechanics, I've been to spare parts depots. I think I understand a good deal about this business.
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    What disturbed me right from the outset, and why I asked for a GAO report on FAA's conduct of safety certification, is the propensity to contract out maintenance but to many different providers, and, in your case, of aircraft that have many different cockpit configurations, and that there was not a uniformity required by FAA of cockpit conformity. And second, that you were permitted to spread this maintenance around among a number of providers, some of whom would never see that same aircraft again. They might do a C-check on it but a D-check might be done by somebody else. My experience has been that the best safety is provided when there is continuity in the conduct of maintenance and when there is the possibility of a holistic conduct of safety, that the provider sees the whole aircraft in all of its aspects.

    You have agreed now to reduce the number of maintenance providers and to have the work done as closely under one roof as is possible. I think that's a good judgment. I wish you had done it a year ago.

    Mr. JORDAN. Congressman, that's not exactly what I said. We said to narrow it to fewer at this moment.

    Mr. OBERSTAR. I thought it was two.

    Mr. JORDAN. But we could go under one roof. I am saying we've chosen to go with two for good reason I think. But may I make one just brief comment. One of the things that happened, Congressman Oberstar, is that during our growth, it was well published that ValuJet was the fastest growing airline of the startups. We got a lot of attention. At the time when we were at only sixteen aircraft, we underwent a detailed FAA inspection. Shortly after, when we were at thirty-four aircraft, we underwent a detailed FAA inspection, and again at forty-three before we ever got to fifty-one.
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    As you well know, the airline does not rely upon the FAA to be its policeman to the neglect of its own job. But we were paying close attention to our growth rate, to our maintenance, and to our quality control. So I thought that all along the way there were a number of safety checks, a number of reconsiderations, a number of reassurances that we were getting. But in retrospect, to come back to your original question, we have agreed with the FAA the best course of action for us now is to reduce the number of agencies and provide more oversight, and we will do that.

    Mr. OBERSTAR. I have said many times, and I will conclude, Mr. Chairman, but I have said many times that safety responsibility starts at the corporate board room. That is the front line of safety responsibility. It is not the primary responsibility of the FAA, but they have a significant role. And when we looked as a committee at whether an airline is performing appropriately, we look for an attitude of compliance, a compliance spirit. What I have observed from all the records is that you've certainly demonstrated an attitude of compliance. Every time the FAA has made recommendations, suggestions, you have done it. I think that's much to your credit. You need to continue to move in that direction.

    And the public also needs to understand that when a provider such as SabreTech does work, they're not doing it according to their maintenance standards or somebody else's maintenance standards, but according to your maintenance manual that has been approved by the safety certification process you entered into with the FAA. Their conduct of maintenance is in accordance with that manual. If there is something inappropriate, it goes back to your manual and to FAA's certification. That's why the recertification request by the desk survey of FAA was so critical an issue.
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    There are many other items we could explore, but I thank you.

    Mr. DUNCAN. Thank you, Mr. Oberstar. We will go next to Mr. Coble.

    Mr. COBLE. I thank the Chairman. Mr. Jordan, let me revisit the Wall Street Journal article. Do you know, and you may not know, but do you know whether the Southern Region advised the FAA in Washington prior to June 13 of the general terms of the proposed decree allowing you at ValuJet to continue to fly?

    Mr. JORDAN. Sir, I do not know for a fact. I can only tell you that I was told by the officials of the Southern Region that they would be keeping Washington informed every step of the way of what we were doing but that they had the authority at the Southern Region level to approve or disapprove our operations specifications.

    Mr. COBLE. I'm thinking aloud. I think if we knew the answer to this question, and if the answer were in the affirmative that in fact it was done, perhaps we may be a little farther along as to who may have let that story out of the bag. Again, I'm thinking aloud.

    Mr. Jordan, it is I who talked about the uncompleted scheduled trips. I am not alleging that you all don't pay for those unscheduled trips. I was reading from a chronology of the FAA examination of ValuJet airlines. I want to hear from you because you indicated that was not accurate. What I read were these words: ''Action is motivated by concern over ValuJet's flight pay policy (which denies pay to pilots who do not complete scheduled trips)'' and then it continues about the tight twenty-five minute turnaround schedules and the failure to manage the repetitive discrepancies, which I presume are maintenance discrepancies. I'd be glad to hear from you.
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    Mr. JORDAN. Thank you, Congressman. The concern that I have and the frustration that I have is that often we find that FAA inspectors blur the line between the regulation and what they may have been accustomed to on some other carrier that they may have overseen or even worked for. We have repeatedly had difficulty as ValuJet has attempted to do its business in a different way in the confusion that's been caused by some of the folks who have been charged with the regulatory oversight of our company. Quite frankly, our compensation program was designed to be different. It was designed to have a lower base pay than big airlines pay. It was designed to have a very healthy profit-sharing bonus program to go with it. It was designed to have stock options to go with it so that our employees could do very well as the company, the shareholders, and customers did very well.

    And then there were just some assumptions made that we didn't pay when we did an air return when, in fact, the opposite is true. We not only, if an airplane takes off and the captain decides that he/she should go back for the safety of the customers, that individual is paid for the trip as if it had been flown to the original destination and is also paid for the subsequent trip when the airplane is repaired and it goes on out. So it has been bothersome that those things are misunderstood.

    Regarding the twenty-five minute turn times. Again, the airline with the safest record in the industry is Southwest. They've built themselves around fifteen minute turn times, twenty minute turn times, often twenty-five minute turn times. And quite apart from what the regulations show or what specific inspections show or what any sort of irregularity might be vis a vis what we're required to do under the law, I was frustrated by the kinds of remarks that are put into the report that are somewhat anecdotal and opinions.
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    Mr. COBLE. I'm glad to hear you clarify that. I repeat, I was merely reading from the report. But I can see, and, again, this is my opinion, and I, unlike you, am not well versed in aviation and day-to-day operations——

    Mr. JORDAN. I'm happy to answer the question, sir.

    Mr. COBLE. But I can see how if that, in fact, had been the case that the pilots were not paid, that would present a situation where safety may well be compromised. You know, my gosh, I'm in the air now, I'm not going to get paid if I go back, let's full ahead. Are you reading me? Do you see where I'm coming from?

    Mr. JORDAN. I do, but I now see a great need to clarify a point. We do have a situation where under normal routine cancellations in the ongoing everyday business that we do not pay for every single cancellation for whatever the reason might be. I would concur with you that it might become an area of concern if that became a prevalent factor or something that happened frequently. ValuJet's record will show that time and again, month in and month out, we completed well more than 99 percent of all of our scheduled flights. Therefore, on those rare occasions when a flight was canceled, we put in a policy that allows our pilots to then volunteer to pick up other trips to augment that pay. I think our pay promotes safety.

    Mr. COBLE. I have not yet violated the red light all day, but can I have one more quick question?

    Mr. DUNCAN. Yes, sir. Go right ahead.
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    Mr. COBLE. I know how upset the Chairman gets when that red light comes on. I try to run for cover when it does illuminate. Mr. Jordan, now, by gosh, I forgot what question I was going to ask. [Laughter.] It'll come back to me in due time. Let me reclaim it at a later time. Go on to the next side, Mr. Chairman.

    Mr. DUNCAN. Well, we've let people run over.

    Mr. COBLE. Oh, it comes to me now.

    Mr. DUNCAN. Go right ahead.

    Mr. COBLE. Mr. Jordan, is there a rule of thumb as to the number of mechanics per airplane in a fleet? In other words, if I have six in my fleet, should I have an average of five per plane? Is there a rule of thumb in the industry addressing that?

    Mr. JORDAN. There are some rules of thumbs that various carriers have based upon their work rules and the amount of productivity they normally get. Back to what Congressman Oberstar talked about earlier, of course there would be a higher number of mechanics if we did not do out-source work for our heavy checks, we would have to hire for that much like the big airlines do. So we separate normally heavy maintenance of what we call C's and D's of sort of the annual physical checks or the ones we do every 5 years from what is called line maintenance that we do every night when we check tire pressure and check oil and that sort of thing. There are rules of thumb, yes, sir.

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    Mr. COBLE. Thank you, sir. Thank you, gentlemen, for being with us. Thank you, Mr. Chairman.

    Mr. DUNCAN. Thank you, Mr. Coble. Mr. DeFazio.

    Mr. DEFAZIO. Thank you, Mr. Chairman. Mr. Jordan, in listening to your testimony, unfortunately I hear some echoes of bad days on this committee when we spent hours listening to the management of Eastern. Do you think there were any problems? Did you sign that consent order under total duress feeling that your airline has conducted itself as well as any other airline flying out there today in terms of safety and maintenance?

    Mr. JORDAN. I really don't understand the Eastern reference.

    Mr. DEFAZIO. The thrust of the question, sir, is that you had the DOD suspend you for 7 months, you had the February 14 report which I find contains some alarming things, we had the May 6 report, and now we have the consent order. You then said if any other airline had been subjected to this scrutiny, I don't know if they might have come out worse than us and I consider this basically standard. So there's no feeling that there were any problems that needed correction?

    Mr. JORDAN. I didn't say that. I will go back to my testimony and I will say that I acknowledged there were problems. There were deficiencies that we expect to correct and for which we expect to put in preventive actions for the future. The DOD failure to approve ValuJet came at a time that we were under the first national inspection and I think it is somewhat understandable they chose to withhold that certification at the time. As Mr. Broderick testified, they shortly thereafter in January gave us full approval. Recently it was reported that we no longer have it. They merely put it in a temporary state of non-use. They have had a practice since the Arrow Air accident a number of years ago whenever there's an accident they do a complete review and make a determination whether that carrier should have a temporary——
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    Mr. DEFAZIO. Thank you. We don't have much time here. If we can move on to another point. Back to the long discussion about the canisters, whose responsibility is it to determine the disposition of the canisters, and either of you two gentlemen can answer. It is my understanding that normally the airline would send a work order to the contractor and the contractor would then execute the terms of that work order. In this case, it didn't seem to happen. Mr. Townes has some problems here, but I am just trying to figure out who should have initiated the disposition. Why would you send an obsolete canister back to an airline, Mr. Townes?

    Mr. TOWNES. Our people were operating under what they thought to be instructions and normal standing orders for the return of company owned materials.

    Mr. DEFAZIO. So it wouldn't be normal for you to receive a work order to would say obsolete canisters, please dispose of properly. Someone would go to the expense of having the obsolete canisters routinely returned to the them so that they could dispose of them through another subcontractor I assume since ValuJet doesn't handle these sorts of things. Your subcontractor gave them to you who gave them to ValuJet and ValuJet would have then turned around and given them to another subcontractor to dispose of. It seems like an awful lot of steps to me. Why wouldn't you just dispose of them? Why wouldn't ValuJet tell you to do that?

    Mr. TOWNES. Again, unfortunately, ValuJet's work order regarding removal and installation of the oxygen generators contained no instructions as to discharge or disposal. ValuJet put out a statement after the accident suggesting they had given us instructions to discharge and dispose of the generators, but all of our relevant personnel immediately and categorically denied receiving any such instructions. When we dispose of hazardous materials we use typically a certified outside hazardous materials contractor to whom we'll send various types of hazardous things. As I said, the COMAT system is sort of out of the loop. Our people, believing that they were operating under standing instructions and returning equipment that came off the customer's airplane, no matter how well intended they were, no matter the issue surrounding putting the word ''empty'' when it wasn't empty, et cetera——
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    Mr. DEFAZIO. Right. I'm trying to get at whose responsibility. So this was normal operating procedure?

    Mr. TOWNES. I believe so.

    Mr. DEFAZIO. Standard operating procedure under your contract with ValuJet then. These two subcontractors that you had who handled them, how large are they? How long had they been subcontractors? What was the training that these two subcontractor individuals who have been identified as the problem received?

    Mr. TOWNES. Those were individual contractors.

    Mr. DEFAZIO. You mean these weren't companies; they were individual people who were contractors?

    Mr. TOWNES. The two people we're talking about are two individual contractors who worked for these contractor companies.

    Mr. DEFAZIO. So you subcontracted with a company who subcontracted with individuals? So those companies didn't employ anybody, they had a bunch of people working piece rate as subcontractors, is that it?

    Mr. TOWNES. That's a fair way to describe it, yes.

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    Mr. DEFAZIO. That's fairly extraordinary. So this is the future of maintenance in America. He subcontracts with you, you subcontract with someone, those people don't employ anybody but they subcontract with people who are individual subcontractors who then don't get worker's compensation or any other benefits paid and they're responsible for paying themselves, I've seen this dodge before, and don't get any benefits because they're individually employed subcontractors. What were the qualifications these people had?

    Mr. TOWNES. I don't have those in front of me right now, Mr. DeFazio, but I'd be very happy to get the exact background and all certified training on the two individuals involved and bring it back to you for the record.

    Mr. DEFAZIO. I think the committee would like to see that.

    [The information received follows:]

    Answer: Each of the subcontractors employees were licensed airplane and powerplant mechanics and were fully qualified to perform the work required.

    Mr. DEFAZIO. If we could go back to Mr. Jordan. Would you say is there a tradeoff between cost and safety at some point?

    Mr. JORDAN. Congressman, you offered both of us an opportunity to answer that question. May I just comment on it?

    Mr. DEFAZIO. If you know anything about the subcontractors, that would be fine.
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    Mr. JORDAN. Well, I know something that is quite pertinent to your question, and that is that we had given instructions that when items are removed from our airplanes of this nature, they are to be disposed of and not returned to ValuJet without our specific instructions. I think that's important.

    Mr. DEFAZIO. OK. And those were standing orders that were essentially violated by the subcontractor?

    Mr. JORDAN. That's correct.

    Mr. DEFAZIO. And the subcontractor's subcontractor's subcontractors. It has been brought to my attention that recently ValuJet was seeking another subcontractor to overhaul thrust reversers and a reputable company offered that they thought they could do this for about $23,000 each and they were told by your maintenance people that a $13,000 flat rate was all that could be paid. This seems to me to present a potential safety problem. This company assures me that this is something that couldn't be done for $13,000 without perhaps subcontracting to subcontractors to subcontractors and individuals. You don't think there is at some point when you're squeezing from the top, when the management is squeezing to get profits, that at some point as it goes down the chain and other people are squeezing and other people are squeezing that you don't compromise safety at some point?

    Mr. JORDAN. First of all, I have no knowledge whatsoever of what you just said about the thrust reverser. But I can tell you that we will pay whatever it costs to have the thrust reverer overhauled in accordance with the regulations and in accordance with the maintenance manual. And upping the price and doubling it or tripling it won't make it any safer either.
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    Mr. DEFAZIO. Where you've subcontracted with someone who has then subcontracted with someone who doesn't employ anyone but just subcontracts with people, would you feel confident about that person working on a critical component of your plane?

    Mr. JORDAN. Not the way you state it, sir.

    Mr. DEFAZIO. Well, that's apparently the way this worked.

    Mr. JORDAN. That's not exactly how I see it. Each of these individuals has to hold an FAA A&P certificate in order to do any work on an airplane.

    Mr. DEFAZIO. But how many hours do they have in type? We had another FAA memo where the FAA was concerned about the number of hours in type and it was for comparison purposes only. ValuJet's familiarization training is considerably less than other operators of DC–9s, approximately half with your nearest competitor, who also gave additional training according to an asterisk which you didn't. And then we have the DC–9 chute tail cone problem where the mechanic told the FAA inspector, ''Hey, I just got here, you know, I've never worked on one of these things before. Is that rigged wrong? I didn't know that.''

    Mr. JORDAN. Those are great stories except the FAA can't find who that guy was, they don't know his name, they can't tell us anything that allows us to do an investigation so we can come back and follow up on it, and we had zero time to respond. It reads well in the newspaper, and I'm sorry I can't respond to you right now, but each and every one of those are things that we will go through. I can talk to you about the level of training and experience that mechanics have at other carriers if you would like.
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    Mr. DEFAZIO. Do you believe it is excessive at other carriers, more than 40 hours is excessive in type?

    Mr. JORDAN. Absolutely not. No, sir.

    Mr. DEFAZIO. So they are not doing something that's excessive but it is something you don't feel is necessary?

    Mr. JORDAN. I didn't say that either. I have not acknowledged that we have less than half the training. I heard you say it.

    Mr. DEFAZIO. It is in this FAA memorandum here. I'm sure you have read it. It is the May 6 memorandum from the FAA and it is at page 19.2.04, halfway down the page, ''Duration of Training.'' Mr. JORDAN. Would you like me to talk about the report in detail?

    Mr. DEFAZIO. I would be happy to have your response to that in writing too, because I don't want to over-indulge the patience of the committee here. But I guess the point is that they do have .26 in this other memo which is the consent order which you signed which talks about the tail cone not being rigged properly and at least three other ValuJet aircraft did not have tail cones rigged properly. And you're saying now that can't be substantiated and it wasn't true, yet you signed the consent order. If you thought that was really untrue, you would have asked to have it struck from the consent order.

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    Mr. JORDAN. No, sir. If the Congressman will read the consent order, you will see that in there we have an acknowledgement agreed to by the FAA that we have not admitted to any of those things. We had less than an hour to discuss them. They wanted them listed in the document, for whatever reasons they had, but as late as last night they acknowledge that item number 26 is something that they can't explain exactly how it got into the report. It is all part of an investigation. Normally, when there's a NASIP inspection, which is usually the biggest thing an airline ever undergoes before there was a ValuJet, then there is at least 30 days given to the carrier to respond. We have had no time to respond. That item is something I can't talk about. It sounds really bad and I'm sorry that I can't give you any good explanation, but I have nothing to go on at this point.

    Mr. DUNCAN. Mr. DeFazio, I've let you go for 12 or 13 minutes and I've got other members who want to ask questions. I'll come back to you in a minute.

    Mr. DEFAZIO. Thank you, Mr. Chairman. I'm sorry.

    Mr. DUNCAN. Mr. Ehlers.

    Mr. EHLERS. Thank you, Mr. Chairman. Mr. Bollinger has been sitting there very bored. I think it's time for a question to him. The Challenge 2000 study that you did, several questions about that. First of all, you referred to zero accidents. That may be a worthy goal, but are you serious about achieving that goal?

    Mr. BOLLINGER. I can't think of any other goal to set, frankly. I think the issue isn't to achieve a specific number of accidents, but to recognize that the goal needs to be expressed in numbers of accidents rather than a rate, because no matter how small you make the rate, if it doesn't keep going down, as traffic grows accidents will increase. So I think it's a worthy goal. If we don't achieve it, at least it starts putting people's minds around the problem in a slightly different way.
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    Mr. EHLERS. Are you familiar, I assume you are since you were hired to do this, but are you familiar with the current accident theory which says that as you reduce the accident rate below a certain level, you have a different regime of type of accidents. It's that the old model doesn't work here. You're dealing with random events and certain sequences which tells me that you're never going to get down to zero. There are always events. The best one I can think of is the accident which occurred recently in Calli, Colombia, where there were approximately six errors committed by two individuals, the pilot and the air traffic controller, all of them very minor errors that occurred in precisely the right sequence at the wrong time to cause the accident. I think that's the type of accident we're going to be dealing with in the future primarily, rather than the single incident as we do with ValuJet.

    In looking at your recommendations for the FAA, a couple of questions. First of all, I just want to clarify one thing. I understand that an initial report was submitted to the Secretary of Transportation which was somewhat critical of the Office of the Secretary of Transportation and that they asked that the criticism of their office be removed. Is that correct or incorrect?

    Mr. BOLLINGER. Not exactly. We had a process where we wanted to interact with the Office of the Secretary of Transportation, the FAA, and other parties during the conduct of the study. We had offsite meeting, a series of sessions with the leadership. OST didn't really participate fully in that process and waited until after a draft report was being sent for comment to make their suggestions. There was a series of about a dozen suggestions. We thought all of them were valid points. We elected to make one or two what I would characterize as relatively minor changes.
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    The specific point related I think to some data on OST's role in driving the length of the rulemaking process. I think if you look at the report, we're still quite critical of the whole process and all the participants in terms of driving the time, but didn't feel the data itself would substantiate whether it was in OST hands or FAA hands in whether that was driving the time delay.

    Mr. EHLERS. But isn't the problem with OST precisely the one that you had; namely, they get involved too late and throw a monkey wrench into the regulatory process by coming in too late and saying, hey, we don't want it done that way?

    Mr. BOLLINGER. You might say that, but I'm not comfortable drawing conclusions from just one data point.

    Mr. EHLERS. OK. I thought your study also had looked at that. The recommendations that you have here about how the FAA should change its performance, two questions on that. No. 1, how would that have impacted on the current situation with ValuJet that we're talking about today? And No. 2, do you see the FAA moving in the direction of your report, and how long will it take to implement that?

    Mr. BOLLINGER. In terms of the ValuJet, it is again one of these what if questions. But I can comment on a couple of things. One is that we recommended in the report that a new airline, merely by virtue of the fact that it's new, has a less well-established safety culture and safety program, doesn't mean it's any better or worse, just less well-established, and that in and of itself might justify additional oversight.
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    The second comment is that right now there is a binary standard—you're safe or you're not. I think if you set a higher objective well beyond safety, but a standard of operational excellence, that in and of itself gives you additional margin for safety. That you can't just have a binary standard. We felt that it might be possible to have an ability to stratify the airlines based upon a level of best practices achieved within the industry and give those that haven't yet achieved those best practices additional support and FAA assistance, not just oversight but assistance, in developing those best practice programs.

    In terms of your second question, I think the senior executive panel of the FAA has fully accepted the recommendations. The pace of change in the FAA over time has been relatively slow, and, frankly, I think that's a topic worth investigating at some point. I personally don't work that extensively within the Government, but compared to a lot of the companies I work with, it is quite slow. But I feel that they have accepted the validity of the findings. The stage that they're in now is some detailed implementation of exactly how to implement them, and that's ongoing.

    Mr. EHLERS. If I may, Mr. Chairman, just one last question. We've heard a lot earlier today about the culture at the FAA and implications that was a problem. Do you perceive that to be a problem? And second, I'm not quite clear on what is meant by that culture issue, whether it is a standard Civil Service problem that everyone talks about, or the standard bureaucracy problem everyone talks about, or is there something intrinsically wrong in the FAA that they don't communicate with each other, things don't move up and down the chain of command, and so forth?

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    Mr. BOLLINGER. To the extent we looked at culture, it was really in terms of processes, management approaches, tools, decision support aids, and the like. Frankly, I think we're dealing with an organization that was set up at a different time to deal with a different aviation environment. It is now dealing with a very fluid environment, a lot of different kinds of participants, and where non-institutionalized rules of thumb may no longer work as well as they did in the past. Lots of airlines operate very differently from each other and how they all did from the past.

    And so our recommendations lead in the area of greater institutionalization, more rigorous data collection, established tolerance bands around operational performance to allow for more rigorous approach. That may not reflect the way the culture of the FAA has evolved over time, but I did not sense, for example, there was a cultural barrier toward implementing those kinds of changes. On the contrary, a lot of that stuff is already underway within the FAA.

    Mr. EHLERS. Thank you very much. Thank you, Mr. Chairman.

    Mr. DUNCAN. Thank you, Mr. Ehlers. Mr. Menendez.

    Mr. MENENDEZ. Thank you, Mr. Chairman. Mr. Jordan, my questions to you are primarily as a result of Chairman Hall of the NTSB's written statement today. And so let me ask you in essence the questions he poses, which are, was ValuJet properly ensuring that their contractors were complying with their operating specifications? And if so, how so?

    Mr. JORDAN. We believe we were, sir. We made a determination as part of the selection process to determine that every agency that we choose has experience, that SabreTech, for example, has a long list of fine airlines that it does business for. We verify that they are, in fact, FAA certified to perform the work we ask of them. We put ValuJet employees on the scene to oversee what they do. We send in audit teams to review the work from time to time. But what we have said with the FAA is we're more than glad to provide additional oversight to continue to move in the direction of the highest level of safety.
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    Mr. MENENDEZ. The individuals from ValuJet who are there and the people who do the auditing, what's their training in order to make sure that your operating specifications are being complied with?

    Mr. JORDAN. In general, these are individuals with 20, 25, sometimes 30 years of experience, licensed A&P mechanics trained in their jobs with dozens of different training courses, in their records from big airlines, past experience that they've had.

    Mr. MENENDEZ. In general you said, but what is the average of their time experience, do you know?

    Mr. JORDAN. I don't at the moment, but I do know that the last three that I looked at on this specific assignment were in the 20 to 25 year range.

    Mr. MENENDEZ. Let me just say, notwithstanding the accident, my view is that these are questions that, while we're talking about your particular airline, go to a broader cross-section. But our focus is this and I'm not suggesting these are the causes of the accident. Why were ValuJet's manuals found to be so deficient?

    Mr. JORDAN. I don't understand the question, sir.

    Mr. MENENDEZ. The Chairman of the National Transportation Board poses this question. How did ValuJet's manuals, which were found to be so deficient in so many ways last week, get to be approved by the FAA? That's another question we're going to ask the FAA. But the question to you is, how did you as a company permit your manuals to be so deficient?
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    Mr. JORDAN. Well, I'm not prepared to concur that we did. I am telling you that right now General Davis and his team is going through every manual that we have on ValuJet property. I would point out that we modelled our manuals after another airline that was recently certificated in the not too distant past and every one of our manuals was submitted in the process of our getting certification the first time around to the FAA for detailed review and approval. So I look forward to going through those deficiencies, but I can't respond at the moment.

    Mr. MENENDEZ. The Inspector General has made comments that she would not fly your airline. You've heard her testimony here; I think you sat through most of it. Do you think her comments are unwarranted?

    Mr. JORDAN. First of all, I have tried to make a practice of not criticizing the person who overseas the group who oversees the group that oversees us.

    Mr. MENENDEZ. She did a pretty good job of criticizing your airline. Do you think it is unwarranted, yes or no?

    Mr. JORDAN. Well, I'm happy to say that I think it is inappropriate for her to state her choice of airlines.

    Mr. MENENDEZ. The question is, do you think her comments about your airline are unwarranted, yes or no?

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    Mr. JORDAN. I do.

    Mr. MENENDEZ. With reference to that, do you believe that when the Inspector General of the Department makes those type of unwarranted statements that they affect you in your administrative procedures that you may have as you may have to appeal whatever decision the FAA has had?

    Mr. JORDAN. Yes, I do. The Inspector General of the Department of Transportation is a very powerful person in a highly respected office.

    Mr. MENENDEZ. In other words, you feel that having had these public comments may compromise or prejudice the possibility of your case before an administrative agency?

    Mr. JORDAN. I'm not aware of a news network or newspaper that didn't quote the Inspector General on her comment that she wouldn't fly ValuJet. I find that harmful.

    Mr. MENENDEZ. Let me turn to Mr. Townes for a moment. In follow up to Mr. DeFazio's questions, which I understood, if I heard correctly, I understood in essence to say that ValuJet's out-sourcing to you of maintenance was, as it relates to these canisters, was subsequently out-sourced to a different group to deal with as a supplier, and that they out-sourced it in terms of dealing with the specific task that was at hand. Is that factual?

    Mr. TOWNES. No. I think there's one too many steps in the chain. Let me describe our Miami operations. Slightly in excess of 400 people, about 82 percent of those are direct front-line technicians touching airplanes, and about half of those are what I'll call core employees and about half are contractor employees provided by substantial I think well run companies that provide skilled technicians with A&P licenses to projects around the industry. The nature of the industry is such that projects flex up and flex down, hangar loads flex up and flex down. Companies typically have a core group of employees and they supplement that core group with some contractor employees. That doesn't mean they are not well-qualified, they are A&P qualified people that have good checked backgrounds, typically good experience. The typical order that one gives to a contracting source like that is I'm working on MD–80's, I need 40 A&P mechanics with MD–80 experience, send me their training records, send me the certification thereof, the project starts in 30 days. So I hope that helps you to understand that use of the term contractor.
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    Mr. MENENDEZ. In this incident, which is what I'm specifically trying to determine, ValuJet hired your company to do a series of tasks including the task that deals with these canisters that have been described. Is that correct?

    Mr. TOWNES. That's correct.

    Mr. MENENDEZ. Subsequently, did you not then out-source part of that task as it relates to these canisters to two companies that I think you described to Mr. Oberstar?

    Mr. TOWNES. Part of the task, if you will, was performed by contractors integrated into our ranks. I don't want to characterize them as a special single cell operating over here.

    Mr. MENENDEZ. But they're not your people?

    Mr. TOWNES. That's correct.

    Mr. MENENDEZ. And did they then get someone who was not in fact——

    Mr. TOWNES. No, sir.

    Mr. MENENDEZ. So there's three steps here—ValuJet to you to these other two companies as part of contracting with you in-house.
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    Mr. TOWNES. That's right. And those two individuals that I referred to in my opening remarks were employees of those contractor source companies, A&P qualified people with good backgrounds and, as I said earlier, well-intended and made mistakes and then they misrepresented the sign-off on the work order.

    Mr. MENENDEZ. My concern is I was trying to gather how many times removed does a process become and what are the safeguards in each and every time as that process goes along from ValuJet to you to these individuals who were contracted. What are the safeguards, the fire walls that are created there to make sure that we don't have similar circumstances like that? That is my concern.

    Mr. TOWNES. I can speak to that. It starts with the overall project definition between the airline and his contractor. It starts with a disciplined approach toward program management as to what will be accomplished on this particular check or this particular modification package. That manifests itself in a deep set of individual work cards and task instructions, much like the one that I referred to earlier, and each one of those would have any number of subsets to sign off on the final work card. So to answer your question, I think the safeguard that's there is proper communication and good project management disciplines like any complex project. Whether you have contractors integrated in your ranks or not, if you do have a good, solid general maintenance manual, excellently prepared project management disciplines, thoroughly prepared and managed engineering orders, as things change or as repair orders are made as the airplane is opened up, for example, and non-routine tasks become apparent for performance, as long as all of that is in good stead, then you have excellent safeguards. That's why this entire industry of out-sourcing that I talked about earlier is, in fact, a safe process.
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    When I isolate the errors of what happened in this tragedy, I isolate it down to some very finite tasks of just a few people. Even in our own company, among 2 million man-hours a year, our people show up for work every day knowing they want to do the right thing. So that's how those safeguards are guaranteed, those types of disciplines. Perhaps Mr. Jordan would like to add to that.

    Mr. JORDAN. May I just add one thing. I think what's been left out of this discussion a little bit is the detailed written instructions that are handed to these individuals. These are like an attending physician as part of another surgical team. It doesn't mean they are not qualified, these are A&P licensed people who know what they're doing, they're put in with another team and they are told to go follow instructions one through nine in the maintenance manual, use what you learned as an A&P trained mechanic, follow exactly what Douglas wrote in the manual, when you sign off item by item on the card be sure you have complied with that. It is all part of becoming a certified mechanic. The written word is a big part of that process.

    Mr. MENENDEZ. Thank you, Mr. Chairman. Let me just ask one thing, so if your manual is bad then, having the licensed individual who goes and says follow steps one through six, if the manual is bad, are they supposed to override the manual if their personal knowledge is such or do they have to follow the manual?

    Mr. JORDAN. A bad manual will have been FAA-approved, airline approved, manufacturer approved, and if the individual finds something that's wrong, it is his or her responsibility to raise his hand immediately and say there's something wrong with this and I won't comply with that work. Generally speaking, the manuals are not wrong.
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    Mr. MENENDEZ. Thank you for your answers. Thank you, Mr. Chairman.

    Mr. DUNCAN. Thank you, Mr. Menendez. Mr. Bachus.

    Mr. BACHUS. Thank you, Mr. Chairman. Mr. Jordan, when I arrived here today I received your letter. It says on here ''Each and every time we fly our single most important priority is safety.'' That's true?

    Mr. JORDAN. Yes, sir.

    Mr. BACHUS. It says you're concerned that ''these hearings not be used to unfairly characterize ValuJet's dedication to safety.'' And that's a concern, is it not?

    Mr. JORDAN. Yes, sir.

    Mr. BACHUS. You have attached to this packet a letter from a well-known CEO in Atlanta which says, ''It appears the real reason for shutting ValuJet down is not safety but bureaucratic politics.'' You may not have endorsed that, but it was attached.

    Mr. JORDAN. We put together a big packet of materials that represent the feelings of our customers.

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    Mr. BACHUS. Right. It says, ''No business should be shut down for paperwork violations.'' Do you think that the violations that we've heard about today are paperwork violations?

    Mr. JORDAN. We've had a number of paperwork violations. I have said repeatedly I acknowledge genuine deficiencies that we plan to both fix and put preventive actions in place for.

    Mr. BACHUS. Which are not paperwork violations.

    Mr. JORDAN. That's correct, sir. There are some real ones that are paperwork as well.

    Mr. BACHUS. It says in your testimony, ''We have not, and will never, cut corners when it comes to safety.'' Is that true?

    Mr. JORDAN. Yes, sir.

    Mr. BACHUS. If I were looking at the evidence, you started your corporate existence two and a half years before the crash in the Everglades. Is that right?

    Mr. JORDAN. Approximately, yes, sir.

    Mr. BACHUS. So you have been operating two and a half years. You started with two planes, you have fifty-one in service now or shortly before you were shut down. Now two of those planes have been destroyed in two and a half years. That's 4 percent of your fleet has been destroyed in accidents. That's a pretty large number. That's true, isn't it?
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    Mr. JORDAN. Yes, sir, and neither resulted from a cut corner by ValuJet.

    Mr. BACHUS. Let me ask you, the one that was destroyed on a runway, it was caused by fire in an engine that was overhauled at a Turkish repair station that did not meet FAA standards. Is that correct?

    Mr. JORDAN. I think you heard Mr. Broderick testify that that failure was a result of a manufacturing defect in the disc deep inside the engine which was purchased by ValuJet with certification that it was fully air worthy and that defect was something that not one airline in the world could have prevented.

    Mr. BACHUS. OK. Let me accept that. Let's just go back for the last year. I'm sitting on this committee and I'm trying to figure this out. A year ago, you heard me question the earlier witnesses about it, you had an airplane that landed with 1,400 pounds of fuel on board when less than 2,000 is minimum FAA standards. So it almost had no fuel. That's pretty horrifying, is it not?

    Mr. JORDAN. It's a serious incident. Horrifying is a choice of word. Big airlines have shut down both engines in flight with zero fuel.

    Mr. BACHUS. But this was total fuel.

    Mr. JORDAN. I understand that. And I think we heard Mr. Hinson testify that was enough fuel to return to the alternate airport. It sounds like a very serious problem. We don't minimize it at all. I don't call it horrifying.
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    Mr. BACHUS. I went through January of this year. Let's start with January 7, this is just a few months ago. You had a ValuJet plane make a pretty bad landing in Nashville. In fact, it bounced down the runway and its tail hit the runway. Is that right?

    Mr. JORDAN. There were two incidents in Nashville. The one I described earlier had some bouncing to it because its landing gear failed. Nobody knows yet why it failed. No indication that a cut corner caused that. We had another incident in Nashville where the airplane did strike its tail on landing, yes, sir.

    Mr. BACHUS. So two of those?

    Mr. JORDAN. Yes, sir.

    Mr. BACHUS. And one of them had been repaired just a month before. It had failed a month before and then it was repaired I think by SabreTech and then it landed February 1 and collapsed again.

    Mr. JORDAN. Well, there's millions of parts on an airplane and the fact that one has been repaired before and has another incident is not necessarily connected.

    Mr. BACHUS. And within the same month you had a jet overrun the runway in Atlanta, you had one that ran off the runway at Dallas, and you had one on the 28th of the next month that overran the runway in Savannah.

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    Mr. JORDAN. In a very short period of time, sir, we had those four airplanes go off runways or taxiways. The FAA obviously was very concerned about that, as was ValuJet airlines. We put in some very specific changes and new requirements for the captain to follow for landings and take-offs in inclement weather on icy, wet runways and that sort of thing. The FAA has said since January and February they have been extremely pleased with those changes we put in place and they were all part of changes that had taken that concern away prior to our shutdown.

    Mr. BACHUS. I understand that. But I think it is fair to say that since your inception you have had some pretty serious safety violations, a number of them. Is that not correct?

    Mr. JORDAN. Any safety violation is serious to me. And, yes, sir, we've pointed out that we've had several. But I do think they have to be put in context.

    Mr. BACHUS. But it says ''We have not, and never will, cut corners when it comes to safety.''
    Mr. JORDAN. That is correct. And I would be happy to have the captain at the control of the airplane that overran the end of the runway confirm to you that didn't result from cutting corners.

    Mr. BACHUS. You flew a plane 148 times with a leaking hydraulic line. Is that correct?

    Mr. JORDAN. I have read the report. I understand that report. I have not had an opportunity to respond to it yet. I really believe that it is important to understand that entire issue.
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    Mr. BACHUS. I'm saying look at it from our point of view. We see one after another, one after another.

    Mr. JORDAN. I guess I'm maybe suggesting that it is important to read some reports from some other airlines sometime maybe.

    Mr. BACHUS. ValuJet has landed on a wrong runway, ran off the end, and then failed to report it. Are you aware of that incident?

    Mr. JORDAN. No, sir.

    Mr. BACHUS. So that's not something you have any knowledge of?

    Mr. JORDAN. No, sir. Could you tell me where that came from?

    Mr. BACHUS. It was reported in the U.S. News and World Report, June 24 edition. So they could tell you. I read in The Washington Post just a few days ago that they report an incident that occurred in late February where mechanics working for ValuJet in Atlanta used a hammer and chisel to remove a bulky DC–9 engine part being replaced. They did not have a Pratt & Whitney maintenance manual that would have informed them that a special tool is required for such work. On a flight to New Orleans shortly afterwards, the engine lost oil pressure and shut down in flight. Could you explain how that happened?

    Mr. JORDAN. Well, the hammer and chisel incident has been widely reported and widely discussed. I guess it is probably the most dramatic one and it sounds the zippiest in the news media. We had a highly skilled and experienced mechanic who made a choice to use actually a screwdriver and a hammer to dislodge a part that was frozen in its place. There is a specific Pratt & Whitney part that is called for in a Pratt & Whitney manual that can be used to remove it. The manual does not say whether or not the Pratt tool would have removed it since it was in a lodged position. But the individual used tools that don't sound particularly good, and by the way, I'm not excusing it nor condoning it at this point. But what was done after he completed the removal of that part and the replacement of that part is the engine was run up at speed and the airplane was pressure checked to be sure there were no oil leak, and the crew was made aware and the maintenance people were aware of what was done, and there was a subsequent failure after take-off.
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    Mr. BACHUS. But it did fail.

    Mr. JORDAN. Yes, sir. The seal failed and caused loss of oil.

    Mr. BACHUS. But can you see how these instances would raise a red flag?

    Mr. JORDAN. Yes, sir. Could you someday let me read to you from some other airline NASIP reports?

    Mr. BACHUS. This is the only airline that we're having a hearing on today. I am aware that one report in May of this year said that you were not the worst low-cost carrier as far as accident rates; it rated you second worst.

    Mr. JORDAN. Well, I'm not proud of being No. 2 on that scale. What I am trying to suggest is that in the accident rate, the broken ankle of the flight attendant and the broken toe bar count as one full accident. We really don't have the time, I'm quite sure I need to stop very soon, but I would love to be able to put these into context. What I am trying to do is say to you there are many, many things about these rules that I don't understand that you deal with everyday. There are many things about the airplane maintenance that I understand that may be a little different to you and when you read them in the paper the way they've been construed and displayed, I think they're misrepresentative, and that's unfair to you.

    Mr. BACHUS. I understand what you're saying.
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    Mr. DUNCAN. Mr. Bachus, I apologize to you but I've let you go on for about 17 minutes now. I have got to get to other members.

    Mr. BACHUS. Let me just close by saying I hope that you can understand that when we ask questions about these things it is not bureaucratic politics and that we don't consider some of these things paperwork violations.

    Mr. JORDAN. No, sir. I didn't mean to imply that I think that at all. I know in fact our people visited with you and you expressed very genuine and sincere concerns about safety. I may be a little defensive right now but I didn't mean to be disrespectful.

    Mr. BACHUS. I don't think you were. And let me say I have heard from people who fly ValuJet. I think your employees, like those at Southwest and many other airlines, I think they bend over backwards. I think they are a dedicated group of people. I think there are some serious matters here that have to be addressed.

    Mr. JORDAN. Yes, sir, and we've committed to fix them and we want to let the FAA see our fixes and recertify us under the tightest rules they choose.

    Mr. BACHUS. Thank you. Thank you, Mr. Chairman.

    Mr. DUNCAN. Thank you very much, Mr. Bachus. Mr. Geren.

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    Mr. GEREN. Thank you, Mr. Chairman. Mr. Townes, Mr. DeFazio expressed some concern about the subcontracting and the subcontracting of that. I personally don't have any negative reaction to that. I think the subcontracting allows a level of specialization and concentration of activity that is not possible with employees perhaps. But I ask do you feel that the FAA requirements that lead to the certification of these mechanics are adequate? Has it been your experience that folks that come to you FAA certified have the qualifications that are reflective of those certifications from the FAA? Do you think we need to ask them to do a better job in that area?

    Mr. TOWNES. Throughout the course of the mechanic's career, he starts off in a technical vocational college and he gets the equivalent of an associate's degree with an A&P license. It is a very good level of education. These are skilled workers with great backgrounds. And as they come into the industry, whether it's an airline repair shop or independent repair station, throughout the course of their career there will be various types of refresher courses, general familiarization courses on an aircraft type, troubleshooting courses, that sort of thing, especially in a training-conscious company. But once he gets that first A&P ticket, that's it. He's got it. Unless he does something gross to lose it, he keeps it. And that's fine. That's a good process and in the independent section of this industry that's 85,000 great people doing a good job.

    What I have proposed today is something that I know has been kicking around at the top end of our industry with the FAA for the last few years. That is, much like a pilot has to retrain and recertify and relicense himself periodically, with the pace of change and the technical complexity of what we do with so many different aircraft types and the proliferation of new carriers and the growing phenomenon of the out-sourcing industry, I think it would be a very, very good idea to go through recurrent relicensing and recurrent mandated training just like a pilot does or perhaps like a CPA does, to give it an easy to understand analogy. That's what I have suggested.
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    I am not saying there is anything wrong with the A&P mechanics that are out there. I have got 1,250 that work for me and they're great people. But I think it is time that we look as an industry and say perhaps it's time to do some recertification training. Some sort of continuing education.

    Mr. GEREN. Could you tell me some of the other commercial airlines that SabreTech does work for.

    Mr. TOWNES. Sir, I think that my customers would probably rather not have me discuss them in the context of this forum right now. If you don't mind, I would like to respectfully decline.

    Mr. GEREN. OK. Could I ask it another way then. Of the four largest airlines in America, any of them regularly use your services?

    Mr. TOWNES. Again, sir, I think I would like to repeat what I said. In the context of this highly public forum, I think——

    Mr. GEREN. I won't ask you to go beyond four, but I think it is important. There are people on this committee that implicit in what they are saying is they think ValuJet was somehow negligent in doing business with you. I would like to get a feel for whether or not there are other major airlines in this industry use you. I think it is important for us to understand the context of the decision that ValuJet used.

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    Mr. TOWNES. Yes, sir. Our two largest customers are one of the top four airlines in the industry and a $12 billion aerospace corporation.

    Mr. GEREN. OK. Thank you. I think that's important because the way some of my colleagues have characterized your method of business might lead some to the conclusion that ValuJet's decision to use you was something less than prudent. In fact, I knew the answer to my question before I asked it but I think it is important for that to come before the committee.

    Mr. Bollinger, one thing that struck me earlier today listening to Ms. Schiavo was that as if we've got this Department of Transportation and we have this one person or this one piece of it that knows more, knew it sooner, and has more courage of its convictions than all the rest of the Department, and somehow all of these convictions and this knowledge doesn't filter through the rest of the system. In your work in looking at reforms that you think might be appropriate to make FAA work better, did you look at this isolated pocket of information that somehow doesn't seem to filter through the rest of the organization? I've never heard such a scathing indictment of an agency of Government from another person in Government as I heard earlier today. It was like she was from Mars and they were from Venus. [Laughter.] I just couldn't understand how she would know all this and somehow she was sitting right here and the FAA folks were right here and it was as if there was some kind of wall that had blocked any type of communication between the two. It was really an extraordinary event to see that today.

    Mr. BOLLINGER. I'm happy to say we did not look at that.

    Mr. GEREN. You did not?
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    Mr. BOLLINGER. No, sir, we did not look at the role of the Inspector General with respect to the FAA.

    Mr. GEREN. Mr. Chairman, I won't go 17 minutes. If I could ask one more question.

    Mr. DUNCAN. Go ahead.

    Mr. GEREN. Mr. Jordan, real quickly, Ms. Schiavo told us that as early as February she was aware of all these problems. She said she didn't communicate it to Mr. Hinson. We don't know if she communicated it to Mr. Peña or not. Had you heard anything back in February that the Inspector General thought that your airline was unfit to fly?

    Mr. JORDAN. No, sir.

    Mr. GEREN. Did that come as a surprise to you to learn it on the news or learn it from the hearing today?

    Mr. JORDAN. Well, I've heard about it since then, so today wasn't a surprise.

    Mr. GEREN. Thank you very much. Thank you, Mr. Chairman.

    Mr. DUNCAN. Thank you. Mr. LaHood.
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    Mr. LAHOOD. Gentlemen, you will be happy to know that I am the lowest ranking member on this committee and I think you're about done. I guess Mr. Lipinski feels like he has some important things that he may have to ask. Mr. Chairman, let me first of all compliment you for the way that you've handled this hearing today. You have not only handled it very judiciously, but you have been very patient with every member. You have extended way beyond the time members would ordinarily have allotted, and I think members appreciate that. You have done a marvelous job here today and I know I speak for all members on the committee in saying that you've really done a great job here today. Thank you for holding this hearing.

    Mr. Townes, the two gentlemen that were involved with mislabelling or however you want to characterize it, are they still working for the company that they were working for when this incident happened?

    Mr. TOWNES. I don't know their exact status. I know they're not at our facility. We can't tolerate that kind of person to have done that, no matter how well-intended their safety actions might have been with the taping and wrapping. The signing off of the work order about the shipping caps when in fact they had not put the shipping caps on there was instant release as far as we're concerned. I don't know the status of those two individuals in terms of their continuing to work. I imagine they remain A&P licensed mechanics.

    If I could say so, if you recall what I said earlier about filling some of the gaps in the system about training and hazardous materials and that kind of thing, perhaps that's another example. If the system overall as an industry would allow those gentlemen, after making a misrepresentation on such a crucial work order, to be out there working someplace on airplanes, then perhaps that's another good thing for the FAA to take a look at with industry immediately.
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    Mr. LAHOOD. I wonder if you could find out if they are still under the employment of the subcontractor and let the committee know that.

    Mr. TOWNES. For the record, I will do that, sir, by name and by A&P license number.

    [The information received follows:]

    Answer: To the best of my knowledge, the two subject individuals are still working as AIP licensed mechanics for their employers. I also understand, however, that both individuals are subject to an ongoing FAA investigation. We have offered the committee their names and AIP license number, but the committee has declined such information. We have provided, however this information and other records to the FAA, and are cooperating fully with their investigation.

    Mr. LAHOOD. Mr. Jordan, do you feel that there was a joint responsibility for this accident, that ValuJet shares the responsibility for the fact that these boxes were mislabelled and were a part of the cargo of the plane?

    Mr. JORDAN. No, sir.

    Mr. LAHOOD. Do you have any notion of whether as a routine your pilot or co-pilots would check to see what kind of cargo is loaded on the plane just as a matter of routine? Would they check that out? Would they check with somebody and say what's the cargo we're carrying today and maybe even take a look to see what it looks like? Is that something they would do as a routine matter?
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    Mr. JORDAN. Sir, it would not be unusual for a pilot, as part of the walk around, to take a look at what is in the cargo hold. In addition to that, the manifest of what goes into the airplane is presented to the pilot. In this particular case, the actual shipping ticket was presented by the ramp agent who loaded it to our First Officer for his review.

    Mr. LAHOOD. Do you know if the pilot or co-pilot visually inspected the cargo on this flight?

    Mr. JORDAN. I don't personally know that. I think the NTSB probably does from their investigation.

    Mr. LAHOOD. Do you feel that you have been treated unfairly in written reports that have been written by the Inspector General?

    Mr. JORDAN. Yes, sir.

    Mr. LAHOOD. In what way?

    Mr. JORDAN. I believe that, first of all, there has been a dual standard applied. As I sit today and I hear testimony that points out ValuJet Airlines was the one airline that attempted to operate in ice and snow, another airline attempted to take off in a tornado, or whatever was said about that, but I guess it has no name. On and on and on it goes.

    Mr. LAHOOD. So you could cite chapter and verse citations and written documentation of where you've been treated unfairly in written reports?
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    Mr. JORDAN. I've just been reminded that you specifically asked me about written reports. And so my sensitivity to fair treatment may have caused me to respond inappropriately. I have not been through detailed written reports by the Inspector General.

    Mr. LAHOOD. Do you think the Inspector General has a vendetta against ValuJet Airlines?

    Mr. JORDAN. I have no reason to believe that. I think the Inspector General has a very strong desire to see a safe system. But I think ValuJet Airlines, because of our current situation, has had the highest spotlight put on it any airline has ever had.

    Mr. LAHOOD. Do you think you would be flying today if it weren't for the Florida incident?

    Mr. JORDAN. Absolutely, yes.

    Mr. LAHOOD. Do you think that your airline will ever fly again?

    Mr. JORDAN. It is my absolute strong optimistic belief that we will fly again and we will fly again soon. I will hasten to add that from the things that I have seen over the last few weeks I know it will be a difficult task. Therefore, we have committed ourselves to working very, very hard to present to the FAA an absolutely strong case that they can approve our return to service under the highest level of safety. I have to believe we'll be allowed to fly again. We're a great airline. We have 4,000 fine professional people who are out of work ready to go out and provide the highest level of safety in running a great little airline. There's no reason to not allow us to fly.
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    Mr. LAHOOD. Thank you, Mr. Chairman.

    Mr. DUNCAN. Thank you, Mr. LaHood. Mr. Lipinski.

    Mr. LIPINSKI. Thank you, Mr. Chairman. I would like to echo what Mr. LaHood had to say in regards to the Chairman presiding over this long, long, detailed hearing today. It has been a very sensitive hearing and it could have been potentially an enormously confrontational hearing. But thanks to the demeanor of our Chairman, that has not occurred. Although I'm not surprised because, in having worked very closely with him since the first part of this year, I know him to be one of the fairest minded men I've run across here on Capitol Hill and it continues to be a pleasure to work with him day in and day out.

    Getting back to our witnesses who have also been here a long time, probably as long as we have been here, but I do have a few questions. The maintenance manual that you have in dealing with the removal of these canisters and the disposal of these canisters, Mr. Jordan, I would assume that Mr. Townes' company received a copy of that maintenance manual?

    Mr. JORDAN. Yes, sir, I believe that Mr. Townes' company has the maintenance manual and also the work cards themselves that specifically lift the instructions from that manual and outline on them for purposes of signing for the work.

    Mr. LIPINSKI. How are they transmitted to SabreTech? You sign a contract with SabreTech to do some of your maintenance work. At the time of the contract signing are those documents turned over to SabreTech, or just how are they conveyed to SabreTech?
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    Mr. JORDAN. Sir, we employ a vice president of what we call heavy maintenance whose responsibility includes the oversight of all of our contractors. It is his job in working with the professionals who work for Mr. Townes' organization, for example, to determine, A, do they already have those manuals in their possession, for example an MD–80 maintenance manual; B, is that manual acceptable for work on ValuJet's MD–80's; or C, do we need to provide them the manuals for our particular airplanes. Any one of those should be an acceptable way of doing business and we have quality assurance people who have to oversee that, Mr. Townes employs quality assurance people because of his FAA certification who also have to oversee that. So there are a number of ways that those manuals can get into their hands and a number of ways they get cross-checked.

    Mr. LIPINSKI. Does ValuJet itself try to confirm that the subcontractors of SabreTech receive these maintenance manuals? Do you do anything independently?

    Mr. JORDAN. As I tried to point out earlier, our contract is with SabreTech as a licensed FAA certificated agency. We have a contract whereby they agree to perform specific work that we call out. And in the refurbishment of this airplane, in preparing it for service, one of the things that was required is removing out of date generators and replacing them with in-date generators. That requires such things as the capping of the ones that got removed.

    Mr. LIPINSKI. I remember your testifying to all of this. I am simply asking do you have any independent audit of their subcontractors getting a maintenance manual or do you rely upon their ability to make sure their subcontractors get this information?
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    Mr. JORDAN. We, in addition to the work they do, have individuals who work for ValuJet who go to their property and oversee the work and look at such things as whether they have the proper manuals in their hands when they're doing the work.

    Mr. LIPINSKI. Do you know if you had anyone there overseeing this particular work when the canisters were being removed?

    Mr. JORDAN. It is my understanding that we had ValuJet employees on SabreTech property during the time that this airplane was being received looking at a variety of things. I have no personal knowledge that that individual was looking at this specific activity on this particular airplane.

    Mr. LIPINSKI. How much time elapses from the time the canisters are removed and the canisters wind up back on a ValuJet plane?

    Mr. JORDAN. I think there's a little confusion here. These generators were removed. They, A, should have been capped, and B, should have been discharged, and I know you don't want to hear all that again. But the fact of the matter is they never should have gone on an airplane. They're junk.

    Mr. LIPINSKI. But they did. I am just saying how long a period of time was it?

    Mr. JORDAN. In this particular case how long from the time they were removed to the time they went on the airplane, I don't know. Mr. Townes may have that information.
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    Mr. TOWNES. Approximately 2 weeks or more.

    Mr. LIPINSKI. Approximately 2 weeks.

    Mr. TOWNES. Yes.

    Mr. LIPINSKI. Maybe Mr. Jordan has something to add.

    Mr. JORDAN. I was just looking and the inspection date indicates March 4, 1996, and the accident of course was May 11, 1996.

    Mr. LIPINSKI. So it was longer than 2 weeks then that they were down with SabreTech people?

    Mr. JORDAN. Well, as I continue to look, the actual date on this sign off is April 28, 1996. So several months.

    Mr. LIPINSKI. OK. Let me go to Mr. Townes over here. Mr. Townes, do people who you subcontract to, do you have someone in your company that is responsible for seeing to it that they get the maintenance manual on how to do this all properly?

    Mr. TOWNES. Yes, two documents are the Bibles that guide our work. One is the general maintenance manual and the work deck of these types of task cards that come from the airline customer, and the other document that guides our work is the FAA approved inspection procedures manual which, if you will, is the SOP for running the repair station. The blending of those two is conducted by management. You have leads, supervisors, project managers, shift managers, director of maintenance, director of quality, and typically in our company vice president and general manager of a particular facility. So there's ample well-qualified people in place to oversee and guide the work according to the general maintenance manual.
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    If I could just point out that I tried constructively earlier to say that there may be some gaps and there may be a gap in that if the general maintenance manual and the task card from an engineering order point of view, in terms of the overall management of the workflow that has to come first from the airline and manifest itself in this card, if it doesn't specify how to remove, how to discharge, or how to dispose of the inherently hazardous canisters, it is the gap that I talked about earlier. These work cards don't say that. ValuJet's work order contained no instructions as to disposal or discharge. There is no end game specification in the work deck. Beyond that, it is the issue that I talked about before that we need to fix, and that is the mechanic should not have to guess. I don't forgive the false sign off. I can't ignore and I don't minimize the word ''empty.'' But when the work deck itself doesn't go to that detailed specification and we're required to work to those types of written engineering instructions, we have a problem that goes beyond one incident and should be fixed industry-wide. At the same time, I think it highlights in painful detail that relatively thin but tragic chain of events that I talked about.

    Mr. LIPINSKI. But that it is ValuJet's responsibility to see to it that this card for maintenance is comprehensive, wouldn't it be? It wouldn't be your responsibility, it would be ValuJet's responsibility.

    Mr. TOWNES. Mr. Lipinski, I think the best way to answer that is that I truly believe it is a broader responsibility. I don't want to sit here in a public forum and lob blame in any direction.

    Mr. LIPINSKI. Well, they actually have the ultimate responsibility anyway. I mean, they can subcontract out to you and you can subcontract out to somebody else and they can even subcontract out, but ultimately the responsibility comes back to ValuJet. Isn't that right, Mr. Jordan?
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    Mr. JORDAN. Congressman, perhaps it would be helpful, as Mr. Townes testified, these individuals, even though they are subcontractors, are part of a seamless system where they work under the supervision of a lead mechanic within the SabreTech organization. But I would like to also point out that I can submit for the record if you would like the actual documents from which these individuals worked. I think when you see the warnings, the cautions that are on these cards to be certain that these things are dealt with as the highly explosive devices they are, that's important. Additionally, we'll be happy to submit for the record a written statement we have from a ValuJet employee on the scene where he instructed that these things be disposed of.

    Mr. LIPINSKI. Yes, sir, I would like to have you submit all of that for the record.

    [The information received follows:]

    Answer: As SableTech's President, I am also providing for the record three signed affidavits from Sabretech's personnel indicating that ValuJet never gave them any instructions whatsoever regarding the hazardous nature of these generators, nor did they give Sabretech employees any instructions regarding discharge or disposal of the generators.

    [Insert here.]

    Mr. LIPINSKI. Let me read here to you. ''A certificate holder,'' which you are the certificate holder, ValuJet is, ''may make arrangements with another person for the performance of any maintenance, prevention maintenance, or alterations. However, this does not relieve the certificate holder of the responsibility outlined in section A. Each certificate holder is primarily responsible.'' This is simply saying in black and white what I just said earlier, that actually the ultimate responsibility rests with you no matter how many people you subcontract out to. Now that they may very well have made mistakes and they were wrong may be true, but it is ultimately your responsibility even though you contract this out. Would you not agree with that?
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    Mr. JORDAN. Mr. Lipinski, what we're trying to say, however, is we have the right to rely upon certain assurances, such as the compliance with EPA laws and certain regulations. What you just read is the responsibility we have for the oversight for everything that gets done on our airplanes by a subcontractor. That's our responsibility. But when it comes to the proper disposal of hazardous waste and we ask the agency to dispose of said waste, then we have a right to rely upon that to be done properly.

    Mr. LIPINSKI. The individuals who removed the canisters from the plane, were they also the individuals who wound up giving the canisters back to ValuJet and ValuJet having them be put on a plane?

    Mr. TOWNES. No, sir. Those are different people.

    Mr. LIPINSKI. Do we have any reason to suspect that the people who gave these canisters back to ValuJet assuming they were empty, not marking them, really had any idea of what they were dealing with whatsoever?

    Mr. TOWNES. Sir, I can't get inside their heads but I think they were well-intended.

    Mr. LIPINSKI. It just seems to me that people who are part of the aviation industry and have had some experience in maintenance would realize how dangerous these canisters could be and they would have taken the appropriate action. If they have had experience in the aviation industry and they didn't know how dangerous the situation was with these canisters, then I seriously question that they should be involved in the aviation industry at all. But my time is running down fast and we don't really seem to be getting awfully far with this particular line of testimony. Let me just get back to Mr. Jordan for a moment, Mr. Chairman, if you will indulge me, and say there have been numerous times when people referred to the consent decree and listing specific areas of concern, dates, occurrences where you have said you really don't know if those are true or not, that you haven't had the opportunity as of yet to really investigate them and to be able to testify satisfactorily to the validity of these charges that the FAA has put forth. You have done that a number of times. Which brings me to wonder, your company signed this consent decree, you've said that you didn't sign it under duress, but, on the other hand, you were told I am sure that if you didn't sign it, you were going to be taken into court and they were going to try to shut you down anyway, so you would take the consent decree trying to get it over and done with as quickly as possible, cost you as little money as possible, and get on the road to being able to fly again. But after reading this over, having some time to reflect upon it, do you believe that the FAA did the right thing to you in shutting you down?
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    Mr. JORDAN. Sir, I really didn't mean to imply that. General Davis and his team are actively going through each and every one of those, and as soon as I get back to Atlanta, I'll be doing the same thing. The consent order we signed, and if I said I didn't feel any duress, I didn't mean to say that. The fact of the matter is it was made very clear that we could voluntarily shut down, in which case we could work to get back up sooner, and that's the course of action I chose, or we could not voluntarily shut down and things would be more difficult, and that's the alternative I did not choose. Out of well over 2,000 inspections you have heard here said today, over 5,000 inspections since ValuJet has been in business, but over 2,000 of this 30-day period alone, some 31 or 34 items are in this consent order. And, as I pointed out with number 26, there seems to be some concern as to what even happened at all in that instance.

    Mr. LIPINSKI. We have to move on. I appreciate that answer.

    Mr. OBERSTAR. Would the gentleman yield?

    Mr. LIPINSKI. I'll yield to the gentleman from Minnesota, Mr. Oberstar.

    Mr. OBERSTAR. Just briefly on another subject. Earlier this afternoon in your questioning of the Inspector General, you raised a number of issues, among which was a question to Ms. Schiavo: ''Did you ever talk to the Secretary?'' meaning the Secretary of Transportation. There was an awkward silence and a consultation, and then the response, ''I can't answer that because I have recused myself due to a criminal investigation that is underway.'' The implication was left that the Secretary of Transportation was under investigation. There have been a number of consultations now and the Inspector General's chief counsel has called back to the committee and has a statement to make about this matter. And I believe you have some additional information on which you should comment at this point.
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    Mr. LIPINSKI. Thank you, Mr. Oberstar. Mr. Chairman, earlier in the hearing the impression was left by the Inspector General that the Secretary of Transportation may be under a criminal investigation. This impression was created by the Inspector General refusing to comment on whether she had talked to Secretary Peña about safety issues after saying she had not talked with FAA Administrator Hinson. She claimed that she was unable to answer the question about the Secretary because there was a pending criminal investigation. This clearly implied that the Secretary was the subject of a criminal investigation.

    It is my understanding that the Deputy Inspector General is preparing a statement that the Secretary is not the subject of an investigation. We would like to make this statement a part of the record when it becomes available. I am also perplexed about how the IG can be recused from answering a question about meetings with the Secretary but not recused about answering questions about meeting with the Administrator. In addition, I don't understand why her recusal precludes her from answering our questions but not from appearing on television shows as recently as last night to discuss ValuJet. We will be conducting a further investigation of the terms of the recusal. The Inspector General was specifically advised by Chairman Duncan that she was creating the impression that Secretary Peña was under criminal investigation. We have serious concerns about her motivation in letting this impression stand.

    Mr. Chairman, I make that request of you and knowing you as well as I do I am sure you will honor that request.

    Mr. DUNCAN. I certainly will, Mr. Lipinski. Thank you for clearing that up. The statement from the Deputy Inspector General will be made a part of the record as soon as it becomes available.
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    Mr. LIPINSKI. Mr. Chairman, if you would just indulge me one more minute. I have one more question to ask Mr. Jordan. Mr. Jordan, I want your opinion. If the Inspector General had not written in her article that appeared just after your tragic crash that she wouldn't fly on ValuJet, and she had not said ValuJet until after the crash occurred because she testified here today that she didn't name any airlines in her original story, if she had not added ValuJet to that story after the crash, do you believe that you would be grounded today?

    Mr. JORDAN. I honestly don't know the answer to that question. I don't know that I even have an opinion. There have been too many factors that have entered in. I do know this, that my lawyers tell me that we could have overturned a shut down had we chosen to fight, that we had grounds to do so. We decided to take the upper ground, to go forward in building ourselves back and not fight on the legal front. The comments that the Inspector General has made have been disturbing to me, but I can't possibly tell you how much of our shut down can be attributed to them.

    Mr. LIPINSKI. Thank you.

    Mr. DUNCAN. Thank you, Mr. Lipinski. Do we have other questions? I believe Mr. Bachus has another question and Mr. DeFazio. Mr. Oberstar may have additional questions. We'll go first to Mr. Oberstar and then we'll go back to Mr. Bachus.

    Mr. OBERSTAR. Just briefly, Mr. Chairman. I want to join in the chorus of appreciation and respect for the manner in which you've conducted the hearing, in the objectivity that you've shown and the respect for each member's concerns and interests in asking questions. This hearing has raised so many issues that need further inquiry and in depth review that I feel we are just scratching the surface and have just begun to inquire into the range of issues raised here.
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    I think it was very important for us to set to rest some of the questions raised by the Inspector General, questions that were raised without substantiation, without documentation. For example, her statement about recusal, there were no terms set forth, no documentation about it, just suspicions raised, questions raised. The news story that she wrote about ''I go out of my way to stay off commuter planes.'' without any substantiation, without saying on what grounds and what basis. Words have consequences. If you say something like that, you engender fear among a wide sector of the traveling public. And if you're in that position and you are going to make such a profound statement, you had better back it up. If I were ever to say anything like that, or you were ever to make a statement like that, I think every news organization would want to know the basis on which we make that statement, every airline in whatever sector, regional, commuter, or major carriers would want to know on what basis we would make such a statement. Yet, her statements go unchallenged and unsubstantiated. I think there are some very, very serious questions raised in that arena.

    The process of contracting out and the basis on which contracting out is conducted and the terms and conditions, the certification process that FAA has followed, even a statement raised here by Mr. Townes of ''I think it is time for recertification training for FAA personnel,'' I think these raise a whole new chapter of inquiry for the committee to follow up on a long-standing concern about the quality of oversight of maintenance surveillance conducted by FAA and, indeed, the quality of maintenance conducted by the airlines themselves. This has been a very instructive hearing and a very useful one.

    Mr. TOWNES. Congressman Oberstar, if I could?

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    Mr. OBERSTAR. Yes, Mr. Townes?

    Mr. TOWNES. I didn't say that the FAA people necessarily needed recertification training. I was referring to——

    Mr. OBERSTAR. You said, ''I think it is time for recertification training for FAA personnel.''
    Mr. TOWNES. I meant A&P personnel, sir, A&P mechanics. It is not my place to try to offer corrections like that to the FAA. But I do know mechanics very well.

    Mr. OBERSTAR. You're right on both counts.

    Mr. DUNCAN. Thank you very much, Mr. Oberstar, and thank you for your kind comments. Mr. Bachus.

    Mr. BACHUS. Thank you. I want to go into more conversation about the oxygen canisters. Mr. Townes, let me start with you. It is pretty common for you to handle these oxygen canisters, is it not?

    Mr. TOWNES. Actually, no, it's not. They have a 12 year shelf life and it is not an everyday occurrence to be handling these canisters.

    Mr. BACHUS. So it is not ordinary to be handling oxygen canisters for your employees?

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    Mr. TOWNES. I can't give you the exact frequency with which they're handled, but they do have a 12 year shelf life and it is not something we do every day. In our Miami facility, I'm told it has been a relatively infrequent task.

    Mr. BACHUS. But it is foreseeable?

    Mr. TOWNES. Yes, in the life of an airplane, especially an older one, there will eventually have to be a replacement of anything that is life limited.

    Mr. BACHUS. What training do your employees have or receive for handling hazardous materials or oxygen canisters?

    Mr. TOWNES. The training that we have had to date up through the date of this incident was the typical and what I will call obligatory OSHA type training—this is a bad liquid, this is a bad chemical and here's how to stay safe in your work. Not bad training, but the training clearly did not go far enough to the standard of excellence in my company.

    Mr. BACHUS. You have said that you're committed to make all changes necessary. What specific changes have you made?

    Mr. TOWNES. I'm glad you asked me that because since this incident there's obviously been a lot of searching for the right thing between Mr. Jordan and myself. We have done a number of things, starting first with the Miami facility. We have, in fact, installed a quality expert from our Phoenix location which I consider our flagship and is a very good operation. We have installed a quality expert from there to be the director of quality of Miami. Second, back in February we again I think did a very good thing by selecting and hiring a well-known industry technical leader to be our overall corporate senior vice president of technical operations, obviously well before the incident. And please keep in mind the time line of having purchased the company the middle of last year in the summer and undertaken substantial management changes commencing in January of this year.
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    Coming back to your question, we have additionally installed tighter program disciplines at the hangar floor. We have trained 340 personnel in our Miami facility alone, not on the obligatory OSHA regulations, but I'm talking about by expert outside trainers on hazardous materials recognition training, not just the rote items that everybody else does. I would urge everybody in my industry to do the same thing, not wait for a regulation to change and not wait for an order to come down, but just do it.

    Mr. BACHUS. So these are system-wide changes that you've made, the last things you described to make sure that something like this doesn't happen again, or is it just Miami?

    Mr. TOWNES. No. Absolutely company-wide. In fact, across all of the 14 major locations in 7 States of our entire parent company as well. The engagement of a renowned HAZMAT expert, somebody who comes from a very, very strong national and international background and is a hazardous materials expert who is guiding this training process. It is part of my written testimony. We take this very, very seriously. No one can undo what has happened, but I would suggest aggressive, fast, proactive actions by everybody, not just me.

    Mr. BACHUS. Based on your training and experience, would you recommend that the FAA or this Congress ban the transportation of these oxygen canisters, just a total ban?

    Mr. TOWNES. As I said earlier, until the NTSB recommendation for installing fail safe fire detection and suppression systems in cargo holds is put into effect, yes, I recommend the outright ban of any oxidizer on any passenger airplane cargo hold, period.
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    Mr. BACHUS. So any oxidizer?

    Mr. TOWNES. Any oxidizer.

    Mr. JORDAN. May I just comment on that last point?

    Mr. BACHUS. Sure.

    Mr. JORDAN. I believe that with or without fire and smoke detection, with or without fire and smoke extinguishing equipment, these things do not belong on airplanes that carry people, ever.

    Mr. BACHUS. I tend to agree with you that even if you have the fire retardant compartment or a detector particularly, it just tells you you've got a problem but it's not going to solve it. So I would agree with that.

    Let me ask you, Mr. Jordan, ValuJet is classified as a will not carry carrier of hazardous materials, is that correct?

    Mr. JORDAN. That's correct, sir.

    Mr. BACHUS. Accordingly, ValuJet is responsible for recognizing hazardous materials and making sure that no hazardous materials are loaded onto your aircraft.

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    Mr. JORDAN. Yes, sir, that is correct.

    Mr. BACHUS. Who is responsible at ValuJet for determining or identifying hazardous material?

    Mr. JORDAN. Every individual who comes in contact with it. The individuals who work for us on the ramp go through a training that cautions them that if anything arouses their suspicion they are to pay particular attention to that. Again, all the more importance as to why anything that referred in any manner to hazardous material or had any of the flame decals on there would have—the very fact that this individual looked at this box and saw the word ''empty'' on there with the word ''canister'' and then he went and showed that particular item to the First Officer are things that obviously weren't enough. We had a problem here. But the individuals are trained to look for anything that might arouse suspicion.

    Mr. BACHUS. I did notice the FAA requires 2 hours of initial training in identification of hazardous waste materials. Last year, I understand that you all asked that they reduce that to 1 hour of training. Fortunately, it was not reduced. But do you now agree that 2 hours is——

    Mr. JORDAN. In some ways, to me, that's like the price of overhauling a thrust reverser. What we were trying to say, I think, is we want quality training and we'll do whatever amount it takes, if we need 10 hours, 20 hours, or 3 weeks. But I think right now we carry almost no hazardous materials. We don't want them on the airplane at all. So, therefore, an extensive training program probably wouldn't be necessary at ValuJet. But that's part of what General Davis and his team will be looking at also.
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    Mr. BACHUS. I understand what you're saying. Even if these canisters were empty, they would still be considered hazardous material.

    Mr. JORDAN. That is correct. Empty, discharged, and capped, they still have a residue that is hazardous material. We shouldn't have them on there but that residue won't bring an airplane down.

    Mr. BACHUS. But someone should have recognized that oxygen canisters were hazardous material and not allowed them on the airplane.

    Mr. JORDAN. I think this may point out the kind of thing that Mr. Townes is saying we all need to take a look at. For example, our older model DC–9–30's have standard green metal oxygen cylinders that you have seen. When those are empty, under our own approved standard practice and FAA regulations, we are allowed to carry those. So one person's cylinder is someone else's canister. If it is empty, then that is OK. It is inert hardware, it is benign, it can do no harm. So, again, in retrospect we can say that whether it said empty or not empty, maybe the item should have been completely ripped open and subjected to a microscope and a bright light, I don't know. But I can tell you that had they been properly labelled they never would have been on the airplane.

    Mr. BACHUS. But I guess my point is that it was already against FAA regulations to have those oxygen canisters in the cargo hold whether they were empty or not.

    Mr. JORDAN. Yes, we'll violate the regulations if you put a flammable something in your suitcase and check it. We then need to determine whether we should have opened your suitcase for some reason. Certainly, in the final analysis, we can't put hazardous materials on the airplane under any circumstances.
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    Mr. BACHUS. This was not in a passenger suitcase.

    Mr. JORDAN. I understand, sir. Maybe it was bad example.

    Mr. BACHUS. I have no further questions.

    Mr. DUNCAN. Thank you very much, Mr. Bachus. I certainly agree that I think arising out of this should be possibly some sort of ban on carrying hazardous materials on passenger airplanes. Mr. DeFazio.

    Mr. DEFAZIO. Thank you, Mr. Chairman. Mr. Chairman, you have been most generous and I'll try and use less than 5 minutes. I just want to return, Mr. Townes, to the issue of licensure. My understanding is that in some cases a person may work in a repair station who is not licensed, they conduct work under supervision, and then someone who is licensed signs off on that work. Is that the case in your repair station, or are you saying that in your repair station 100 percent of the people who work there are fully certified A&P licensed people?

    Mr. TOWNES. That's a very good question and let me be very specific. In fact, I'll go to a ValuJet airplane, the C-check that we did on November 904 Victor Juliet last September. That's this airplane. On that airplane, we went back and did an analysis of all the personnel on that airplane—83 percent were A&P licensed, the contractor mix was about 50–50. That's not atypical. That's probably a fairly good microcosm of how work like this is conducted in this industry segment. Those 17 percent personnel, if they don't have an A&P license, they may be in training getting one, they be doing school at night or weekends. They are certainly not signing off on any critical tasks. They work for and through A&P licensed leads, supervisors, managers, et cetera.
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    Mr. DEFAZIO. In this case, were these two subcontractors who we have now identified as individuals both A&P licensed?

    Mr. TOWNES. Yes, to the best of my knowledge they both were, sir. As I said, I will insert for the record their exact and detailed personal histories to make sure that I'm 100 percent accurate.

    Mr. DEFAZIO. There has been some question or discussion about language proficiency. Are these manuals available in other than English to individuals who are working on the planes who might not be fully conversant with English and fully literate in English?

    Mr. TOWNES. Especially in the context of our Miami facility, I'm very glad you asked that question, I've seen it raised in the press and elsewhere. The official language of aviation is English. All official documents of this type that are written for the aviation industry, whether it's a pilot instruction manual or work cards to an A&P mechanic, are written in what is termed simple English. The fact that we've been accused of having people that speak Spanish in our Miami facility should not be surprising.

    Mr. DEFAZIO. And it's not an accusation. I'm certain someone is just raising a question, and I'm raising a question. If you have someone whose native language is other than English, do you have manuals available to them in their native language, be it Spanish, myself, I'm Italian, or other languages?

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    Mr. TOWNES. No, sir. The official language is English. But you can't get an A&P license without being proficient in the official language.

    Mr. DEFAZIO. But 17 percent of the employees are not licensed, so they may not have any proficiency in English. They haven't passed the exam. So you're saying 17 percent of the people who worked on that C-check were not licensed. So I'm curious as to their proficiency and how they might take to written instruction. It could be a problem.

    Mr. TOWNES. With all due respect, I'm not sure I can agree to syllogism. The logic of what you're saying on the surface does make sense, but I think if we went to our Miami facility, sure, there are a number of Hispanic workers there but all of our management are bilingual including the anglo president of the company. So I don't see that as an issue.

    Mr. DEFAZIO. Well, I'm pleased to hear that. I will look forward to receiving the documentation that shows that the two individuals who have been identified as the problem here were 100 percent A&P licensed and were fully qualified. Frankly, I've got to say you've taken a lot of the burden here off Mr. Jordan today even though the CFR, as quoted by Mr. Lipinski, would not lift the burden off his back. It's very generous of you. But then, obviously, more scrutiny falls on you and your operation. So I would like to receive that information on those two individuals.

    Mr. TOWNES. Again, since it is not at my fingertips, we'll get it for the record.

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    Mr. DEFAZIO. Thank you.

    Mr. DUNCAN. Thank you, Mr. DeFazio.

    Mr. Jordan, I don't want this hearing to conclude without at least mentioning that last week at our hearing at least three of the witnesses, including the husband of one of the victims of the crash, the Chairman of the NTSB, and the head of a victims group from another crash, I think all stated that ValuJet had gone above and beyond the call of duty and had probably done more than any other airline in working with the families of the victims. I want to commend you for that, sir.

    I might also, as a way of closing this, just ask you a couple of things. One is, there apparently is at least a reasonable possibility that we may find or the NTSB may report that this accident was not the fault of ValuJet. Obviously, this hearing has gone, and intentionally so, far beyond this one accident and it has caused us to look, as well it should, at the entire operation of the FAA and into almost all the issues or questions that have been raised by this terrible tragedy, and we're going to continue looking into this. But your company before this crash had done many things right. You carried how many passengers safely before this accident?

    Mr. JORDAN. The official number was 9.7 million people, almost 10 million people without a fatality, sir.

    Mr. DUNCAN. And you also carried a number after the crash.

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    Mr. JORDAN. In the short period before we were shut down we carried 285,000.

    Mr. DUNCAN. But also, going in an opposite direction, you I'm sure have been very disturbed, upset, possibly even angry about some of the things that you have found out that your company has done that probably you didn't know about in regard to maintenance and some of the problems that the FAA has raised. I guess what I'm getting at is what have you learned from all of this. In other words, I don't want to hear now about what you've done right, what I want to know is what have you learned from all of this. You must have learned a great deal out of all of this experience. In fact, I'd say you could probably write a book based on this. I don't want you to write a book now, but tell me what you've learned from this.

    Mr. JORDAN. First, on behalf of the ValuJet people, thank you for the kind remarks about what they did in showing the concern for the families of the victims. One of the things I've done from the first moment is feel a strong responsibility to step up personally and take responsibility for the leadership of our company. The things that I have learned as reams and reams and reams of documentation have come out is certainly there are things in there that I want to see improved upon, things that we want to learn from. I have said repeatedly the only safety record that's acceptable is a perfect safety record. We don't have a perfect safety record and I won't go into great detail. But I think that one of the things that hurts the most is having grown up in the maintenance-engineering-technical operating side of the business is the very fact that we don't have perfection. If we go through all of these dozens and dozens and thousands and thousands of reports, I continue to believe that no airline could have gone through this degree of scrutiny. But I set that aside because I have responsibility only for ValuJet.
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    I'm proud of General Davis and his team. The burden is on us now to hand to the FAA documentation, certification, justification to approve ValuJet again. When we do, I believe it will be somewhat credible for you. I think you will be able to believe that we will highly likely have been held to the highest standard any airline ever has. We will take everything that we have done that is less than perfect in the safety arena, we'll fix it, we'll put preventive actions in place. I can go down item after item. When we taxi off a runway, that's not pleasing to me. If somebody uses a hammer when a Pratt & Whitney tool is called for, I'm not happy about that. When we do anything that is less than perfect in the arena of safety, I'm not happy with that. We will hold ourselves to the highest standard in this industry.

    Mr. DUNCAN. Let me ask you this in that regard. Mr. LaHood asked you a while ago if you thought that you would get back open again and you optimistically stated that you hoped so. It has been widely reported in the press that you're losing $10 million for every month that you're not operating. I don't know how accurate that is but I've seen that figure in the press. In addition, I understand that you've had to pay $2 million or some figure like that to the FAA for the extra inspections that they've had to do. Is that correct?

    Mr. JORDAN. That is correct, yes, sir.

    Mr. DUNCAN. I'm sure the FAA wouldn't use this language, they would use more technical language, but if they came to you tomorrow and said what we're going to require of you is absolute certainty that you're operating the safest airline in the world, how soon do you think you could reasonably certify to the FAA or assure them that that's what you're going to be operating?
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    Mr. JORDAN. I firmly believe we can do it in less than 30 days because we have a major head start. Over 5,000 inspections on our company give us the ability to hand the FAA documentation they couldn't possibly have on any other airline. It will take a lot of hard work on our part and we're going to have to answer many, many questions. We'll redo every manual, we'll resubmit every organizational chart and every resume on every human being. I think it is doable and we're committed to doing whatever the FAA needs to see to certify us accordingly.

    Mr. DUNCAN. You have hired General Davis, but would you make an offer to the FAA that they could hire any independent outside aviation consultant of their choosing to inspect your plan and your overall operation in order to assure the FAA that you did now have the safest airline in the world?

    Mr. JORDAN. I would be more than pleased to do that. I asked General Davis to come aboard for one reason, he was someone that has impeccable credentials, an individual whose integrity is beyond reproach, someone I believed would give us a fair and unbiased unlimited overview of our safety. I didn't have the ability to ask the FAA to send somebody in; we had to act on our own. I think General Davis makes an outstanding safety czar. I'm very proud of him. If the FAA wants to send in an independent agency of their choosing to assist in our certification, I think I would have no choice it would be in our best interest to cooperate.

    Mr. DUNCAN. All right. Thank you very much.

    Mr. COLLINS OF GEORGIA. Will the Chairman yield?
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    Mr. DUNCAN. Yes, Mr. Collins?

    Mr. COLLINS OF GEORGIA. I want to say that I have full confidence in Lewis Jordan and his staff to hand over the requirements that the FAA has presented to them in the consent order. He has told this committee today in the last few minutes that he hopes to be able to hand that over within a week to 10 days. Having talked with Administrator David Hinson last Thursday in my office, he, too, is looking forward to that documentation being handed over to the FAA. We have an event coming up in Atlanta, Georgia in July that the FAA Administrator understands very well that the services of ValuJet is going to be much needed. But those services will only be used upon certification and documentation of the safety of the airline. And I am confident that ValuJet will be back in operation and will be operating as a safe airline. I thank you, Mr. Chairman, for indulging me in this meeting today.

    Mr. DUNCAN. Thank you for being here, Mr. Collins.

    I want to thank our witnesses for being here today and for their excellent testimony.

    That will conclude this hearing.

    [Whereupon, at 7:09 p.m., the subcommittee adjourned, to reconvene subject to the call of the Chair.]

    [The witnesses prepared statements follow:]
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