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Reason Foundation - Airport Policy and Aviation Security Newsletter

  • Airport Policy and Security Newsletter #52

    In this issue:

    • Who Should Run Airports?
    • ACLU Curbs TSA Mission Creep
    • Comprehensive Airport Operations Software
    • Liquids Ban Still With Us
    • Technology Upgrades Airport Parking
    • NORAD Doing Aviation Security Risk Assessment
    • News Notes
    • Quotable Quote


    Airport Ownership Form Really Does Matter

    What difference does it make who owns and operates an airport? Economists and management consultants theorize that it should make a difference to airport performance, since different owners would pursue different goals and operate under different incentives. One of the best studies to examine this question empirically came out last year in the Journal of Urban Economics. Tae Oum, Jia Yan, and Chunyan Yu’s paper is “Ownership Forms Matter for Airport Efficiency: A Stochastic Frontier Investigation of Worldwide Airports.”(http://dx.doi.org/10.1016/j.jue.2008.03.001)

    Oum and his colleagues used a data set of 109 airports of a variety of sizes and types. Of those in the 2004 sample, 27 were owned and operated by a city or state government, 25 by a U.S. airport authority, 16 had majority or totally private ownership, 12 were public-sector corporations, 7 were owned by U.S. port authorities, and 12 had mixed ownership.

    Nearly all previous studies of comparative airport performance have largely ignored the ownership question, according to the authors. In addition, their analysis used a broader set of inputs and outputs than previous studies to measure airport efficiency. The econometric technique they used is called the stochastic frontier method. It’s similar in principle to the “production possibilities frontier” you may remember from Economics 101—that any firm or agency has an optimum (cost-minimizing) set of outputs (the frontier), but may fail to achieve it due to various inefficiencies and constraints. The paper’s math is beyond me, but assuming they are competent econometricians, let’s focus on what their analysis found.

    First, airports in the categories of (a) private (or majority private), (b) public corporation (corporatized), and (c) airport authority are more efficient than those with various forms of majority or 100% government ownership. Second, among those with the four different types of government ownership, the least efficient are those owned by U.S. port authorities. Third, in those metro areas with multiple airports, efficiency is lower when those airports are government-owned, but not when they are owned by any of the corporate forms.

    Based on these results, the authors reach the following policy conclusions:

    • Countries considering airport privatization should transfer 100% (or at least a majority stake) to the private sector and should avoid mixed ownership with a government majority;
    • The Unites States should reconsider ownership and management of airports by port authorities; and,
    • Although the efficiency of airports directly owned by city and state governments is lower than that of airport authority airports, the difference is not statistically significant. Hence, further research on this aspect is called for.

    ACLU Curbs TSA Mission Creep

    The phenomenon of mission creep is well-known among government agencies. Established to perform one function, the agency may decide on its own to expand into related or other areas, sometimes without any authority to do so.

    I have written before about this danger as it relates to the Transportation Security Administration. The TSA was set up in the wake of 9/11 not as a generalized police agency but solely and specifically to guard aviation against threats from terrorists. Its legal authority to search travelers is based on a narrow exception to the Fourth Amendment (at least as interpreted by Congress) that it is not an “unreasonable” search to require travelers to pass through metal detectors or be searched for weapons or explosives prior to boarding a plane.

    But some TSA screeners have expanded their mission, conceiving of themselves as general law enforcers. An example of that behavior took place at Lambert-St. Louis International Airport last March. Steve Bierfeldt was detained at a checkpoint after he sent a metal box containing $4,700 in cash and checks through the X-ray machine. TSA and local police officers spent about half an hour aggressively interrogating him about why he was carrying so much money—the audio of which Bierfeldt recorded on his iPhone. It turns out Bierfeldt, an aide to Rep. Ron Paul (R, TX) was carrying the cash as part of his duties with the Campaign for Liberty, an offshoot of the Ron Paul for President campaign.

    Several months later, the American Civil Liberties Union sued the TSA on Bierfeldt’s behalf. “We had been hearing of so many reports of TSA screeners engaging in wide-ranging fishing expeditions for illegal activities,” the ACLU’s Ben Wizner told the Washington Times. One example he gave was TSA screeners reading the labels on prescription bottles to see if the patient name matched the name on the passenger’s boarding pass.

    The good news came this fall, when the TSA issued two directives telling officers that “screening may not be conducted to detect evidence of crimes unrelated to transportation security” and that large sums of cash do not meet the threshold as suspicious for reasons of aviation security. In response to those directives, the ACLU announced last month that it was withdrawing its lawsuit. Although the existence of the directives is now public knowledge, TSA has not published them, and says it will not release them unless someone files a Freedom of Information Act request.

    That last point suggests that TSA may have acted under duress, rather than understanding that its screeners had overstepped their bounds. So I think we must all remain vigilant over possible further instances of TSA mission creep.

    More Examples of Comprehensive Airport Operations Software

    Several months ago I wrote about Sensis Corporation’s Aerobahn software—a web-based airport operations tool that can provide real-time information on aircraft and ground vehicles on and near an airport, based in part on multilateration data. Competitor Era Systems Corporation is offering its own web-based airport software—a family of applications called AirScene. The newest application—AirScene.com Symphony— was introduced in October. Symphony competes with Aerobahn for airport surface management.

    Two other Era applications have been purchased by airports in recent months. AirScene.com Noise & Operations Monitoring System (NOMS) allows airport neighbors to enter noise complaints online, while collecting data about the nature, frequency and location of such complaints. The software correlates aircraft identification and flight track data to determine the likely source of each noise complaint. It has recently been installed at both Reagan National and Dulles International Airports, and has just been selected for Bradley International Airport near Hartford, CT.

    Another application is AirScene.com RevenueVue, a system that automates flight tracking and billing, while also providing audit capabilities. Most airports rely on airline self-reporting of flight activity in order to bill for landing fees. RevenueVue automates this process, making billing faster, less labor-intensive, and more accurate. The Port Authority of New York & New Jersey in October began operating a module called Itinerant Aircraft Billing (IAB) at Kennedy, LaGuardia, Newark, and Teterboro Airports, for all non-airline flight billing. Era installed its own multilateration system to generate the flight-tracking data for revenue billing at these airports.

    These kinds of technologies offer a host of possibilities for improved airport operations. They also give us a foretaste of the coming NextGen environment.
    Liquids Ban Will Be with Us a Few More Years

    Last fall the media in both Europe and the United States carried optimistic stories that the end of the hated carry-on liquids ban was in sight—by the end of 2009 in the USA and sometime in 2010 in Europe. These predictions (from senior aviation security officials) were based on the rapid replacement of pre-9/11 two-dimensional checkpoint X-ray machines with advanced-technology, multi-view machines, such as the Smith’s Detection aTiX and comparable products from Rapiscan. Unfortunately, things don’t look that promising one year later.

    The problem seems to be two-fold. First, neither the European Union nor our TSA wants airport-by-airport lifting of the current restrictions; that would be too confusing to air travelers. So that means the ban cannot be lifted in either jurisdiction until all airports are equipped with the new machines at all checkpoints. And because funds are tight all over, that is taking longer than originally hoped. Second, the new-generation X-ray machines are considered reliable enough to detect dangerous liquids only if they include advanced software to distinguish substances by atomic weight—and that software is still being tested by TSA and European agencies, with no certain deadline for approval.

    So the latest word from the TSA i