Audit Initiated of FAA’s Cost Allocation and Revenue Estimation Model
To enhance data transparency, section 519 of the FAA Reauthorization Act of 2018 requires the Federal Aviation Administration (FAA) to report to Congress on the costs allocable to and the total revenues received from users of air traffic services. In addition, the act requires our office to review and determine the validity of the model FAA uses to produce its report. Accordingly, we are initiating an audit of FAA’s Cost Allocation and Revenue Estimation Model (CAREM), which the Agency developed to produce its April 2021 report to Congress. Using CAREM, FAA allocated a total of $11.6 billion in air traffic services costs expended in 2018 to specified segments of users and estimated the revenue received from each group. Our audit objective will be to assess the validity of the model FAA employed to allocate air traffic services costs and estimate the revenues collected from each segment of users.