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Cost Control Issues for the Federal Aviation Administration's Operations and Modernization Accounts

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The Inspector General testified regarding cost-control issues for FAA’s operations and modernization budget before the House Transportation-Treasury Appropriations Subcommittee. He told the subcommittee that FAA urgently needs to bring its costs under control. FAA’s budget has grown from about $8.2 billion in FY 1996 to $14 billion in FY 2004, an increase of $5.8 billion or nearly 70 percent. The magnitude of cost growth FAA has experienced over the past 4 to 5 years is no longer sustainable given the financial state of the airline industry, and multibillion-dollar declines in projected Aviation Trust Fund receipts. FAA Administrator Marion Blakey also testified.