This edition of the Cozen O’Connor Aviation Regulatory Update includes DOT’s announcement of the members and meeting schedule of the Advisory Committee on Accessible Air Transportation (Disabled Passenger Negotiated Rulemaking Committee), the FAA’s withdrawal of its rulemaking on slot management at New York area slot-controlled airports, the FAA’s elimination of slot controls at Newark Liberty International Airport and extension of the Orders governing slots at New York’s John F. Kennedy International Airport and LaGuardia Airport, proposed FAA amendments to PFC funding eligibility for on-airport rail projects, the FAA’s creation of a Drone Advisory Committee to advise the FAA on further regulatory steps regarding the safe integration of unmanned aircraft systems/drones into the U.S. national airspace system, PHMSA’s ban on the carriage of battery-powered portable electronic smoking devices in checked baggage, the continuing House and Senate standoff over the next FAA Reauthorization bill, and the latest DOT and FAA enforcement actions.

Department of Transportation

Regulatory

DOT Tentatively Grants Norwegian Air International’s Permit

DOT issued an Order to Show Cause tentatively granting Norwegian Air International (NAI) a foreign air carrier permit that would allow the carrier to begin serving the United States. NAI’s application has been pending for more than two years, as major U.S. carriers and labor organizations allege that NAI is seeking to use Ireland as a “flag of convenience” to evade the labor laws in Norway in order to lower the wages and working conditions of its crews. They complain that NAI’s plans to hire pilots and cabin crew from a third-party company domiciled in Singapore violates Article 17 bis of the U.S.-EU Open Skies Agreement and DOT’s statutory public interest goal of encouraging fair wages and working conditions. In tentatively approving NAI’s application, DOT stated that the carrier is financially and operationally fit; that Irish aviation safety oversight satisfies FAA and ICAO standards; that NAI is substantially owned and effectively controlled by citizens of Member States of the European Union; and that granting NAI a permit would be consistent with the provisions of the U.S.-EU Agreement. Comments and objections to DOT’s show cause order were filed by May 16, 2016, with answers to those comments and objections filed on May 23, 2016.

DOT Announces Membership of Disabled Passenger Negotiated Rulemaking Committee and Schedule of Committee Meetings

DOT issued a notice announcing the appointment of the members of the Advisory Committee on Accessible Air Transportation (Disabled Passenger Negotiated Rulemaking Committee). The Committee was formed to develop proposed amendments to DOT’s disabled passenger regulations regarding: 1) accessible inflight entertainment and accessibility requirements for other in-flight communications; 2) accessible lavatories on new single-aisle aircraft over a certain size; and 3) amendments to the definition of ‘‘service animals’’ that may accompany disabled passengers on a flight. The Committee’s first meeting was held on May 17-18, 2016, with additional meetings tentatively planned for June 14 – 15; July 11 – 12; August 16 – 17; September 22 – 23; and the final meeting on October 13 – 14.

Enforcement

DOT Assesses $150,000 in Civil Penalties Against VivaAerobus for Alleged Consumer Protection Violations

DOT issued a consent order assessing $150,000 in civil penalties against Aeroenlaces Nacionales, S.A. de C.V., t/a VivaAerobus for alleged violations of DOT’s full-fare advertising rule (14 C.F.R. § 399.84(a)); the rule prohibiting use of the opt-out method of selling ancillary services (14 C.F.R. § 399.84(c)); the disclosure of baggage fees and other fees rule (14 C.F.R. § 399.85(d)); and the statutory prohibition against unfair and deceptive trade practices (49 U.S.C. § 41712). DOT stated that VivaAerobus failed to include an “issuance fee” as part of its full-fare to be paid by consumers in the initial fare matrix on its U.S. website; failed to have a reasonable number of seats available for an advertised fare or to take prompt action to discontinue the advertisement of a fare when a reasonable number of seats were no longer available; automatically added certain costs of several optional services to the cost of tickets without consumers “opting in” for such services; and failed to prominently disclose on its website information on fees for all optional services that are available to a passenger purchasing air transportation. The carrier was ordered to pay $15,000 in civil penalties within 30 days of the date of the issuance of the consent order, with each of four additional equal payments of $15,000 due and payable on July 1, 2016; August 14, 2016; November 14, 2016; and February 16, 2017. The remaining $75,000 will be due and payable if, within one year of the date of issuance of the order, VivaAerobus violates the order’s cease and desist provision.

Federal Aviation Administration

Regulatory

DOT and FAA Withdraw Rulemaking on NYC Airports Slot Management

DOT and the FAA issued a notice withdrawing the agencies’ proposed rule to amend regulations governing scheduled operations at John F. Kennedy International Airport (JFK), Newark Liberty International Airport (EWR), and LaGuardia Airport (LGA). The NPRM would have continued the limits on scheduled and unscheduled operations at these airports and would have required use of an allocated slot 80 percent of the time for the same flight or series of flights. The NPRM also proposed five alternatives for a secondary market for the purchase, sale, lease, or trade of slots and proposed procedures to codify the exercise of DOT’s existing authority to review slot transactions for anticompetitive and public interest effects arising from those secondary market transactions. DOT and the FAA based their decision to withdraw the proposed rule on “significant changes in circumstances affecting New York City area airports, including changes in competitive effects from ongoing industry consolidation, slot utilization and transfer behavior, and actual operational performance at the three airports,” as well as the FAA’s recent decision to end slot controls at EWR, with the airport set to become a Level 2, schedule-facilitated airport under the Worldwide Slot Guidelines effective for the Winter 2016 scheduling season. The FAA said that it will continue to monitor the operational performance at the three New York area airports, and DOT stated that if it detects unfair or anticompetitive behavior, DOT would use its “existing authority” to take corrective action.

FAA Eliminates Slot Controls at EWR

The FAA issued a notice announcing EWR’s designation as a Level 2 airport (i.e., schedule-facilitated, but not slot-controlled) effective October 30, 2016, but through the Summer 2016 scheduling season, EWR will remain designated as a Level 3 slot-controlled airport. The FAA plans to use the following EWR capacities for scheduled flights during the Winter 2016 season, reflecting average airport runway statistics during the recent winter scheduling seasons: 79 scheduled operations per hour; 43 in a half-hour; 79 in consecutive half-hours; and 231 in rolling three-hour periods. The three hour limitation will allow a higher number of flights in some hours while also allowing for “system recovery.” The FAA stated that although there is available runway capacity throughout the day at EWR, it “strongly encourages” airlines to propose “reasonable schedules” in recognition that there is limited runway and airport capacity available for new flights or existing flights retimed to certain hours. The FAA asserted that airlines will be asked to consider alternative schedule times if proposed demand exceeds capacity, which is likely to occur during the busiest early morning, late afternoon, and evening hours. The FAA said that it expects to work with the Port Authority of New York and New Jersey (PANYNJ) as it considers gate and terminal availability and how that might impact the FAA’s review of schedules for runway availability, and that airlines should submit information directly to PANYNJ for airport terminal or gate access. The FAA stated that it intends to deny approval for carrier schedules that exceed capacity with limited exceptions, such as flights operated only a relatively short time period in the prior season, ad hoc or limited term cargo flights such as those operated in past years prior to the Christmas holidays, and flights to meet high demand such as Thanksgiving, Christmas, or similar periods.

FAA Extends Orders Governing Slots and Air Traffic Management at JFK and LGA

The FAA issued notices extending the Orders governing slots and limiting operations at John F. Kennedy International Airport (JFK) and New York LaGuardia Airport (LGA) through October 27, 2018. The FAA is maintaining current rules under the Orders, including (1) current hourly limits of 81 Operating Authorizations (OAs) per hour at JFK and 71 OAs per hour at LGA during peak periods; (2) the 80 percent minimum usage requirement for OAs with defined exceptions; (3) the mechanism for withdrawal of OAs for FAA operational reasons; (4) procedures to allocate withdrawn, surrendered, or unallocated OAs; and (5) permission for trades and leases of OAs for consideration for the duration of the Orders. The FAA stated that the reasons for originally issuing the Orders have not changed appreciably since they were implemented, with demand for JFK and LGA access remaining high and the average weekday hourly flights during peak periods being generally consistent with the operating limits allowed under the Orders.

FAA Proposes Amendments to PFC Funding Eligibility Requirements for Airport Ground Access Projects

The FAA issued a notice of proposed policy amendment regarding PFC funding eligibility for certain on-airport, ground access projects. The FAA is considering amending its 2004 Policy Regarding Eligibility of Ground Access Transportation Projects for Funding Under the Passenger Facility Charge Program (69 Fed. Reg. 6366 (Feb. 10, 2004)) that only permits rail projects to be PFC-funded where the airport terminal is the terminus of the rail line. Currently, to be AIP and/or PFC eligible, an airport ground access transportation project must “exclusively serve airport traffic.” In March 2014, the FAA received a PFC application from the Metropolitan Washington Airports Authority (MWAA) that included a request to use PFCs to help fund both an on-airport rail station and a portion of the on-airport tracks at Washington Dulles International Airport, where the tracks would not exclusively serve airport patrons and employees since the rail line in question would not terminate at the airport station but continue to other destinations beyond the airport. In its July 11, 2014 final decision, the FAA approved portions of the application and the Dulles Airport Metrorail Station project in particular, but deferred consideration of the track portions of the project. The FAA’s review of MWAA’s application has prompted the agency to consider whether the exclusive use policy is too limiting, preventing the approval of PFC funds for some airport ground access projects that might be consistent with the FAA’s mission to ‘‘encourage the development of intermodal connections on airport property between aeronautical and other transportation modes and systems to serve air transportation passengers and cargo efficiently and effectively and promote economic development.’’ The FAA is requesting comments on whether it should amend its policy to allow rail projects that are located on airport, but that may not exclusively serve air traffic, to be eligible for PFC funding, including where the creation of a separate spur into the airport (in order to ensure exclusive use of the right-of-way) would be materially more expensive than having the rail line transit the airport property and continue beyond. The FAA subsequently published a notice extending the comment period on the proposal to June 17, 2016.

FAA Issues Final Rule on Acceptance Criteria for Portable Oxygen Concentrators Used On Board Aircraft

The FAA issued a final rule amending acceptance criteria used to approve portable oxygen concentrators (POCs) for use on board aircraft in air carrier operations under Parts 121 and 135 and certain operations using large aircraft under Part 125. The final rule replaces the FAA’s existing case-by-case approval process for each POC make and model contained in Special Federal Aviation Regulation (SFAR) No. 106 and allows passengers to use a POC on board an aircraft if the POC satisfies certain acceptance criteria and has a label indicating conformance with the FAA’s acceptance criteria. The rule also requires carriers to accept all POC models that meet FAA acceptance criteria. The final rule eliminates redundant operational requirements and paperwork requirements related to use of POCs, including that users obtain a physician’s statement and provide notice to pilot and aircraft operator regarding POC use and the contents of their physician statement. Some of the provisions of the final rule are effective June 23, 2016, with the primary acceptance criteria and labeling requirements effective August 22, 2016.

FAA Issues Draft Advisory Circular on Airport Access by Disabled Individuals

The FAA issued a notice requesting comments on the FAA’s draft Advisory Circular (AC) 150/5360-14A regarding airport access by individuals with disabilities. The draft AC provides guidance and recommendations to assist airports with their compliance with federal accessibility regulations under the Americans with Disabilities Act of 1990; the Air Carrier Access Act of 1986; the Rehabilitation Act of 1973, as amended; and the Architectural Barriers Act of 1968, as amended. The draft AC identifies relevant accessibility-related statutes and regulations affecting airports; provides the main features of each of those statutes and regulations; and lists sources of assistance or additional information. The draft AC also provides standards and technical recommendations on the size and surface materials of service animal relief areas, maintenance methods, and time/distance between gates and relief areas. The FAA is seeking comments on new cleaning technology, such as “nano technology” for potential use for self-cleaning of service animal relief areas. The FAA also requested comments on the potential use of: 1) Radio Frequency Identification (RFID) systems by people who are blind or have visual impairments for “wayfinding” and mobility in the airport terminal; 2) audio-haptic systems designed for enhancing orientation and mobility skills in people with visual impairments; and 3) other technology to enhance wayfinding at airports. Comments on the draft AC are due June 6, 2016.

FAA Tasks Aviation Rulemaking Advisory Committee With Developing Recommendations for Certification of Persons Engaged in Cargo Loading

The FAA issued a notice assigning the Aviation Rulemaking Advisory Committee (ARAC) with the task of developing recommendations regarding the certification of persons responsible for the loading, restraint, and documentation of special cargo loads on transport-category airplanes. Such certification requirements were recommended by the NTSB following the April 29, 2013, crash of a Boeing 747–400 BCF aircraft shortly after takeoff from Bagram Air Base in Afghanistan due to the shifting of the cargo loads onboard the aircraft. The notice solicits membership for a new ARAC Loadmaster Certification Working Group, which will provide advice and recommendations to the ARAC, and ultimately to the FAA, on whether safety would be enhanced if persons engaged in the loading and supervision of the loading of special cargo were to be certificated and identifying which operations should require the use of these certificated individuals. The ARAC will have two years to prepare and submit a recommendation report to the FAA. Requests for membership in the ARAC Loadmaster Certification Working Group must be submitted to the FAA by June 13, 2016.

FAA Announces Creation of Drone Advisory Committee, Reclassifies Student and University Drone Operators as “Hobbyists” for Regulatory Purposes

The FAA issued a release announcing the creation of a Drone Advisory Committee to be comprised of industry stakeholders that will provide unmanned aircraft system (UAS)-related advice to the FAA regarding further steps in integrating UAS into the U.S. national airspace system. Intel CEO Brian Krzanich and FAA Deputy Administrator Mike Whitaker will lead the advisory committee. Applications for membership on the committee were due May 19, 2016, and the selection of committee members is expected to be made by May 31, 2016. The FAA also announced that it will make it easier for schools and students to operate UAS as part of their educational coursework by no longer requiring them to apply for a Section 333 exemption. In a legal interpretation letter issued by the FAA Chief Counsel’s office, the FAA said that persons may operate a UAS for hobby or recreation purposes at educational institutions and community-sponsored events without the need for any FAA license as long as that person is “(1) not compensated, or (2) any compensation received is neither directly nor incidentally related to that person's operation of the aircraft at such events.” The FAA also stated that faculty teaching aviation-related coursework at accredited educational institutions may assist students in the operation of UAS without the need for a FAA license provided the student retains operational control of the UAS such that the faculty member’s manipulation of the UAS’s controls is “incidental and secondary” to the student’s control.

FAA Proposes to Reduce Radio Frequency Communications Used by Flight Service Stations

The FAA published a notice proposing to reduce the number of radio frequencies used by flight service stations that communicate with aircraft in flight and decommission 666 remote communications outlets (RCOs). The radio frequencies consist of: 1) those used by RCOs in which aircraft contact a flight service station by transmitting and receiving communications on a common or discrete frequency; and 2) those that are co-located with navigational aids known as VORs in which aircraft contact flight service by transmitting communications on a frequency and receive communications on the appropriate VOR frequency. The proposed elimination of RCOs would not affect the 347 radio frequencies designated for emergency use or the 194 radio frequencies designated for military use. Also, frequencies in the State of Alaska and Ground Communications Outlets (frequencies used by pilots while still on the ground) would not be affected. The FAA is proposing to eliminate duplicate, overlapping and seldom used radio frequencies. The FAA estimates that its proposed reduction in radio coverage will save it approximately $2.5 million annually in maintenance costs alone. The FAA requested comments on the proposal, which are due no later than June 27, 2016.

Enforcement

City of Cleveland Agrees to $200,000 FAA Civil Penalty, Will Enhance Compliance Systems

The City of Cleveland reached an agreement with the FAA to resolve four pending enforcement cases for allegedly failing to meet FAA requirements for maintaining a safe airport during winter weather. The FAA alleged that over a 15-month period ending in March 2015, managers at Cleveland Hopkins International Airport failed on numerous occasions to keep the airport’s runways and taxiways safe and clear of snow and ice. While the FAA originally proposed a $735,000 civil penalty in September 2015, the city will instead pay $200,000 and has agreed to build upon and maintain existing improvements to its airfield snow and ice removal plan at the airport. Specifically, the city must maintain appropriate staffing and submit reports to the FAA twice each year through 2020; document the staffing allocated per shift for each winter event; procure new and replacement snow removal equipment by 2019 with review by the FAA; construct a snow removal equipment storage building; and comply with specific requirements for executive management oversight in the airport’s Airport Certification Manual (Snow and Ice Control Plan). The airport has already taken numerous steps to address the FAA’s concerns, including providing full staffing as of December 23, 2015, including an increase in the number of field maintenance foreman positions, additional equipment drivers, and improved management oversight; updating its staffing requirements, including minimum staffing levels related to forecast weather conditions; and creating a coordinated snow desk that is operational during significant snow events.

FAA Proposes $162,500 Civil Penalty Against Airbus Defence and Space for Alleged HazMat Violations

The FAA proposed a $162,500 civil penalty against Airbus Defence and Space of Madrid, Spain, for allegedly violating federal hazardous materials regulations. The FAA alleges that on May 25, 2015, Airbus knowingly offered an undeclared shipment of hazardous material containing two protective breathing equipment units, each of which contained a chemical oxygen generator, on a passenger-carrying flight from Seville, Spain, to Miami, Florida. FAA regulations prohibit the transport of these devices as cargo on passenger-carrying aircraft because the chemical is an oxidizer, which can cause or enhance the combustion of other materials. After arriving in Miami, the shipment was offered undeclared to FedEx for overnight shipping by air from Miami to Lenexa, Kansas. The FAA alleges that the shipment was not accompanied by shipping papers indicating the hazardous nature of the contents, was not properly packaged, marked, or labeled, and did not include required emergency response information.

Pipeline and Hazardous Materials Safety Administration

PHMSA Finalizes Ban on E-Cigarettes in Checked Baggage

DOT’s Pipeline and Hazardous Materials Safety Administration (PHMSA) issued a final rule prohibiting passengers and crewmembers from carrying battery-powered portable electronic smoking devices (e.g., e-cigarettes, e-cigs, e-cigars, e-pipes, e-hookahs, personal vaporizers, electronic nicotine delivery systems) in checked baggage and from charging such devices and their batteries on board aircraft. This final rule is consistent with the interim final rule that PHMSA issued in October 2015 and a recent similar amendment to ICAO’s Technical Instructions for the Safe Transport of Dangerous Goods by Air. The ban on carrying such devices in checked baggage was prompted by recent fire incidents. PHMSA also prohibited the charging of devices and their batteries during flight because many of the documented device-related safety issues occurred while these devices were charging, resulting in the ignition of nearby combustible materials. The final rule continues to allow such devices to be carried by passengers and crewmembers on their person and in carry-on baggage. PHMSA stated that allowing these devices to be carried only in carry-on baggage or on a person is appropriate since flight crews can quickly intervene in the case of a device’s overheating, short circuit, or fire in the aircraft cabin. The final rule is effective on June 20, 2016.

Customs and Border Protection

CBP Designates the Automated Commercial Environment (ACE) as the Sole CBP-Authorized Electronic Data Interchange System for Processing Electronic Entry of Cargo

U.S. Customs and Border Protection (CBP) issued a notice announcing that, effective July 23, 2016, the Automated Commercial Environment (ACE) will be the sole electronic data interchange (EDI) system authorized by CBP for processing electronic entry and entry summary filings associated with most cargo entering the United States. CBP also announced that the Automated Commercial System (ACS) will no longer be a CBP-authorized EDI system for purposes of processing electronic entry filings.

Department of Commerce/National Telecommunications and Information Administration

NTIA and Industry Stakeholders Release Best Practices for Protection of Privacy Relating to Unmanned Aircraft Systems/Drone Operations

The Department of Commerce’s National Telecommunications and Information Administration (NTIA) and a group of industry stakeholders, including Amazon, the Association for Unmanned Vehicle Systems International, the Center for Democracy and Technology, the Consumer Technology Association, Future of Privacy Forum, Intel, New America’s Open Technology Institute, PrecisionHawk, X (Formerly Google [x]), the Small UAV Coalition, Online Trust Alliance, News Media Coalition, Newspaper Association of America, National Association of Broadcasters, Radio Television Digital News Association, Digital Content Next, Software & Information Industry Association, and NetChoice released a report, Voluntary Best Practices for UAS Privacy, Transparency, and Accountability, that outlines steps that can be taken by UAS/drone operators to advance UAS/drone privacy, transparency and accountability for the private and commercial use of UAS/drones. The best practices are the result of President Obama’s February 15, 2015, Presidential Memorandum instructing NTIA to convene such a process to develop and communicate best practices for privacy, accountability, and transparency issues regarding commercial and private UAS/drone use in the National Airspace System.

Federal Energy Regulatory Commission

FERC Publishes Notice of American Airlines’ Complaint Against Plantation Pipe Line Company Alleging Illegal Jet Fuel Delivery Suspension

The Federal Energy Regulatory Commission published a notice stating that American Airlines has filed a formal complaint against Plantation Pipe Line Company alleging that Plantation unlawfully proposed to suspend jet fuel transportation service in violation of the Interstate Commerce Act and that its “transmix policy is unduly discriminatory and unduly preferential.” Petitions to intervene or to protest the complaint, as well as Plantation’s answer, are due June 13, 2016.

Congressional Action Impacting Aviation

Senate Passes FAA Reauthorization Bill; House Still Holding Out for ATC Reorganization

On April 19, 2016, the Senate passed its version of an FAA Reauthorization bill, the “Federal Aviation Administration Reauthorization Act of 2016.” The bill, originally introduced as S. 2658 and merged with a previously unrelated House bill, H.R. 636, would reauthorize FAA programs through FY 2017 and contains provisions relating to consumer protection, strengthened aviation security, and the safe operation of drones. The Senate passed the bill by a decisive 95-3 vote. In the House of Representatives, the pending FAA Reauthorization bill is H.R. 4441, the “Aviation Innovation, Reform, and Reauthorization Act of 2016 (AIRR Act),” which would reauthorize FAA programs through FY 2022. While House Transportation and Infrastructure Committee Chairman Bill Schuster (R-Pa.) had hoped to pass the legislation with bi-partisan support, the bill was introduced without the support of the Committee’s Ranking Member, Congressman Peter DeFazio (D-Ore.). The bill was brought up for consideration in February by the full Committee a week after its introduction. After working through dozens of amendments, the Committee passed the bill and ordered it reported out to the full House for further consideration. The House and Senate bills have a number of common aspects, but the most significant difference between the two is the inclusion of a complete overhaul of the U.S. Air Traffic Control system in the House version. This reform, which would privatize ATC operations, has been a priority for Chairman Shuster. In the Senate, however, leadership has maintained the position that ATC privatization should not be included in the next FAA reauthorization. This impasse has caused a recent standstill on moving the legislation forward. The current FAA authorization legislation expires on July 15, 2016, and both the House and Senate leadership have indicated that they would prefer not to pass another short-term extension.