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United States Government Accountability Office: 
GAO: 

Report to the Committee on Commerce, Science, and Transportation, U.S. 
Senate: 

September 2012: 

Slot-Controlled Airports: 

FAA's Rules Could be Improved to Enhance Competition and Use of 
Available Capacity: 

GAO-12-902: 

GAO Highlights: 

Highlights of GAO-12-902, a report to the Committee on Commerce, 
Science, and Transportation, U.S. Senate. 

Why GAO Did This Study: 

To help manage airport congestion, airlines operating at four U.S. 
airports—Washington’s Reagan National and the three major New York 
City area airports—must obtain operating authorizations called slots 
from FAA to take off or land. Airlines operating out of Reagan 
National also may not operate flights beyond a 1,250-mile perimeter 
without congressional approval. In addition to the 24 flights (12 
round trips) previously approved, Congress recently authorized 16 more 
beyond--perimeter flights (8 round-trips) at Reagan National—-flights 
that the airport authority fears will adversely affect Reagan National 
and the authority’s ability to continue servicing its debt. Some 
airlines seeking to serve slot-controlled airports assert that slot 
control rules cause the airports to be underutilized or used 
inefficiently. GAO was asked to review (1) the effects of adding more 
beyond-perimeter flights from Reagan National and (2) how well slot 
control rules are working to reduce congestion, while maximizing 
capacity and encouraging competition. GAO analyzed slot allocation and 
airline schedule data, developed a statistical model, and interviewed 
FAA officials and others. 

What GAO Found: 

The 16 new beyond-perimeter flights that were authorized in 2012 for 
Reagan National Airport are likely to have a limited effect on the 
airports in the Washington, D.C., area. Reagan National has sufficient 
runway capacity to accommodate the new beyond-perimeter flights and, 
with some improvements to baggage handling and security screening 
facilities, will have sufficient terminal capacity. Reagan National is 
routinely operating below 67 hourly takeoffs and landings (“slots”)—-
the maximum number authorized in any one hour-—mostly because general 
aviation or other unscheduled aircraft operations decreased 
substantially after new security restrictions were imposed following 
the September 11, 2001, terrorist attacks. GAO’s analysis found that 
the new beyond-perimeter flights could add a maximum of about 5 
percent of 2011 passenger levels at Reagan National, and if all of 
that increase came from passengers moving from Dulles International or 
Baltimore-Washington International Thurgood Marshall, these airports 
could experience a maximum decline of 4.1 percent of 2011 passenger 
levels. As a result, because Reagan National and Dulles generally do 
not share what are largely fixed costs, passengers shifting from 
Dulles to the new beyond-perimeter flights at Reagan National would, 
in the worst-case scenario, increase average airline costs to use 
Dulles by about 4 percent. Similarly, the new beyond-perimeter flights 
are not likely to affect the Washington Metropolitan Airports 
Authority’s (MWAA) ability to service its $5.2 billion debt for the 
two airports. Finally, because half of the new beyond-perimeter 
flights were awarded to low cost airlines, thereby increasing 
competition, these new flights could have a positive effect on 
airfares on routes where new flights were added. 

Slot control rules help the Federal Aviation Administration (FAA) 
manage congestion at these four airports by limiting the number of 
takeoffs and landings that airlines may make per hour. The rules, 
however, in effect, allow some existing airport capacity to go unused, 
and this capacity is therefore unavailable to other airlines because 
airlines are not required to schedule a flight for each of their 
slots, but instead are only required to use their slots 80 percent of 
the time. Moreover, FAA’s recordkeeping and its process for reviewing 
airlines’ self-reported slot utilization data do not provide 
sufficient assurance that FAA can identify instances when airlines do 
not meet the 80 percent utilization requirement or determine how much 
capacity is going unused. In addition, FAA’s allowing airlines to 
apply the requirement collectively to their pool of slots, rather than 
individual slots, further contributes to slots going unused and 
provides an advantage to airlines with large slot holdings. In 
addition to some existing capacity going unused, flights at the slot-
controlled airports, even when operated, tend to be scheduled in such 
a way that available capacity is used more inefficiently than at like-
sized airports that are not slot-controlled, thereby limiting 
passenger growth and access by new-entrant airlines that could offer 
new service or lower fares. For example, GAO found that flights 
operated at slot-controlled airports tend to be scheduled with smaller 
aircraft. Using statistical analyses, GAO found that scheduled 
passenger flights at slot-controlled airports are 75 percent more 
likely to be scheduled by airlines using an aircraft with fewer than 
100 seats than flights at other like-sized airports that are not slot-
controlled. Slot-controlled airports also tend to have certain routes 
that are flown at higher daily rates and aircraft that are less full. 

What GAO Recommends: 

Among other things, GAO recommends that FAA improve its administration 
of the slot control rules, including applying the utilization 
requirement to individual slots. Department of Transportation (DOT) 
and FAA provided technical comments, which GAO incorporated as 
appropriate, and agreed to consider the recommendations. 

View [hyperlink, http://www.gao.gov/products/GAO-12-902]. For more 
information, contact Susan Fleming at (202) 512-2834 or 
flemings@gao.gov. 

[End of section] 

Contents: 

Letter: 

Background: 

Reagan National Can Accommodate New Beyond-Perimeter Flights, Which 
Are Likely to Have a Limited Effect on Other Washington, D.C., Area 
Airports: 

Slot Control Rules Help Manage Congestion, but Allowing Airlines Not 
to Use Some Slots May Hinder Competition: 

Conclusions: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendix I: Objectives, Scope, and Methodology: 

Appendix II: Comparative Information on Major Airports in the New York 
City and Washington, D.C., Area: 

Appendix III: History of Slot Control Rules and Related Actions: 

Appendix IV: Trends in Average Annual Passenger Traffic and Airfares 
at Selected Washington, D.C., Area Airports: 

Appendix V: Logistic Regression Analysis of Slot-Controlled Airports 
and Aircraft Size: 

Appendix VI: Comments from the Metropolitan Washington Airports 
Authority: 

Appendix VII: Comments from the Port Authority of New York and New 
Jersey: 

Appendix VIII: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: Selected Slot Control Rule Provisions for the Four U.S. Slot-
Controlled Airports: 

Table 2: Hourly Aircraft Operations (Takeoffs and Landings) Allowed at 
Reagan National: 

Table 3: Impact of New Beyond-Perimeter Exemptions on Average Peak and 
Non-Peak Hour Slot Allocations at Reagan National for the Summer 2012 
Season: 

Table 4: Projected Impact of the New Beyond-Perimeter Flights at 
Reagan National on the Cost per Enplaned Passenger in 2013 and 2014: 

Table 5: Percentage Difference in Flights at Slot-Controlled Airports 
That Use Small Aircraft Compared with Flights at Non-Slot-Controlled 
Airports, 2011: 

Table 6: Percentage Difference in Likelihood of a Flight's Using Small 
Aircraft at Slot-Controlled Airports Compared with Non-Slot-Controlled 
Airports: 

Table 7: Logistic Regression Results for Slot-Controlled-Airport and 
Aircraft-Size Model, Small Aircraft with 100 Seats or Fewer: 

Table 8: Logistic Regression Results for Alternative Slot-Controlled-
Airport Variable Definitions, Small Aircraft with 100 Seats or Fewer: 

Table 9: Logistic Regression Results for Alternative Slot-Controlled-
Airport Variable Definitions, Small Aircraft with 124 Seats or Fewer: 

Table 10: Logistic Regression Results for Alternative Slot-Controlled-
Airport Variable Definitions, Small Aircraft with 80 Seats or Fewer: 

Figures: 

Figure 1: Annual Percentage of Late Arrivals and Flight Cancellations 
at the Four Slot-Controlled Airports Compared with All Airports from 
2002 through 2011: 

Figure 2: Nonstop Beyond-Perimeter Slot Exemption Destinations from 
Reagan National from 2000 through 2012: 

Figure 3: Areas of Unused Capacity at Slot-Controlled Airports: 

Figure 4: Airports' Share of Scheduled Flights to or from the Same 
Destination by the Same Airline within 15 Minutes or 30 Minutes of One 
Another, February 2011: 

Figure 5: Average Load Factors at Large Hub Airports for Scheduled 
Flights during 2011: 

Figure 6: Proportion of Legacy and Other Airline Passenger Traffic at 
Slot-Controlled and Non-Slot-Controlled Large Hub Airports, 2011: 

Figure 7: Timeline of Major Actions Taken Regarding Slot Controls and 
Perimeter Rules at the Major New York City Area Airports and Reagan 
National: 

Figure 8: Indexed Average Passenger Traffic for All BWI Domestic 
Flights and Flights between BWI and Denver International Airport, 2000 
to 2011: 

Figure 9: Indexed Average Annual Airfare for All BWI Domestic Flights 
and Flights between BWI and Denver International Airport, 2000 to 2011: 

Figure 10: Indexed Average Annual Passenger Traffic for All BWI 
Domestic Flights and Flights between BWI and Las Vegas McCarran 
International Airport, 2000 to 2011: 

Figure 11: Indexed Average Annual Airfares for All BWI Domestic 
Flights and Flights between BWI and Las Vegas McCarran International 
Airport, 2000 to 2011: 

Figure 12: Indexed Average Passenger Traffic for All BWI Domestic 
Flights and Flights between BWI and Los Angeles International Airport, 
2000 to 2011: 

Figure 13: Indexed Average Annual Airfares for All BWI Domestic 
Flights and Flights between BWI and Los Angeles International Airport, 
2000 to 2011: 

Figure 14: Indexed Average Passenger Traffic for All BWI Domestic 
Flights and Flights between BWI and Phoenix Sky Harbor International 
Airport, 2000 to 2011: 

Figure 15: Indexed Average Airfares for All BWI Domestic Flights and 
Flights between BWI and Phoenix Sky Harbor International Airport, 2000 
to 2011: 

Figure 16: Indexed Average Passenger Traffic for All BWI Domestic 
Flights and Flights between BWI and Salt Lake City International 
Airport, 2000 to 2011: 

Figure 17: Indexed Average Airfares for All BWI Domestic Flights and 
Flights between BWI and Salt Lake City International Airport, 2000 to 
2011: 

Figure 18: Indexed Average Passenger Traffic for All BWI Domestic 
Flights and Flights between BWI and Seattle-Tacoma International 
Airport, 2000 to 2011: 

Figure 19: Indexed Average Airfares for All BWI Domestic Flights and 
Flights between BWI and Seattle-Tacoma International Airport, 2000 to 
2011: 

Figure 20: Indexed Average Passenger Traffic for All Dulles Domestic 
Flights and Flights between Dulles and Denver International Airport, 
2000 to 2011: 

Figure 21: Indexed Average Airfares for All Dulles Domestic Flights 
and Flights between Dulles and Denver International Airport, 2000 to 
2011: 

Figure 22: Indexed Average Annual Passenger Traffic for All Dulles 
Domestic Flights and Flights between Dulles and Las Vegas McCarran 
International Airport, 2000 to 2011: 

Figure 23: Indexed Average Annual Airfares for All Dulles Domestic 
Flights and Flights between Dulles and Las Vegas McCarran 
International Airport, 2000 to 2011: 

Figure 24: Indexed Average Annual Passenger Traffic for All Dulles 
Domestic Flights and Flights between Dulles and Los Angeles 
International Airport, 2000 to 2011: 

Figure 25: Indexed Average Annual Airfares for All Dulles Domestic 
Flights and Flights between Dulles and Los Angeles International 
Airport, 2000 to 2011: 

Figure 26: Indexed Average Annual Passenger Traffic for All Dulles 
Domestic Flights and Flights between Dulles and Phoenix Sky Harbor 
International Airport, 2000 to 2011: 

Figure 27: Indexed Average Annual Airfares for All Dulles Domestic 
Flights and Flights between Dulles and Phoenix Sky Harbor 
International Airport, 2000 to 2011: 

Figure 28: Indexed Average Annual Passenger Traffic for All Dulles 
Domestic Flights and Flights between Dulles and Salt Lake City 
International Airport, 2000 to 2011: 

Figure 29: Indexed Average Airfares for All Dulles Domestic Flights 
and Flights between Dulles and Salt Lake City International Airport, 
2000 to 2011: 

Figure 30: Indexed Average Annual Passenger Traffic for All Dulles 
Domestic Flights and Flights between Dulles and Seattle-Tacoma 
International Airport, 2000 to 2011: 

Figure 31: Indexed Average Annual Airfares for All Dulles Domestic 
Flights and Flights between Dulles and Seattle-Tacoma International 
Airport, 2000 to 2011: 

Abbreviations: 

AIR-21: Wendell H. Ford Aviation Investment and Reform Act for the 
21st Century: 

BWI: Baltimore Washington International Thurgood Marshall Airport: 

BTS: Bureau of Transportation Statistics: 

DOJ: Department of Justice: 

DOT: Department of Transportation: 

IATA: International Air Transport Association: 

FAA: Federal Aviation Administration: 

JFK: John F. Kennedy International Airport: 

MWAA: Metropolitan Washington Airports Authority: 

TSA: Transportation Security Administration: 

[End of section] 

United States Government Accountability Office: 
Washington, DC 20548: 

September 13, 2012: 

The Honorable John D. Rockefeller IV: 
Chairman: 
The Honorable Kay Bailey Hutchison: 
Ranking Member: 
Committee on Commerce, Science, and Transportation: 
United States Senate: 

For each takeoff or landing at Ronald Reagan Washington National 
Airport (Reagan National) and the three major New York City area 
airports--John F. Kennedy International (JFK), LaGuardia International 
(LaGuardia), and Newark Liberty International (Newark)--airlines must 
obtain an operating authorization, also known as a "slot,"[Footnote 1] 
from the Federal Aviation Administration (FAA). Although more than 150 
airports are slot-controlled throughout the world, including all major 
European airports, only these four airports are currently subject to 
slot controls in the United States. FAA started limiting the number of 
takeoffs and landings per hour at these airports more than 40 years 
ago because of congestion and delay. Reagan National is also subject 
to a federally-imposed 1,250-mile limit on the distance of nonstop 
flights to and from the airport, called the perimeter rule. However, 
on three occasions since 2000, federal statutes have been enacted 
requiring a total of 40 slot exemptions (20 round trips) to the 
perimeter rule, allowing nonstop flights to destinations more than 
1,250 miles from the airport. This includes 16 more beyond-perimeter 
flights (8 round trips) required as part of the reauthorization of FAA 
in February 2012.[Footnote 2] Although we reported in 1999 and 2007 
[Footnote 3] that Reagan National could accommodate additional 
flights, the airport authority that operates Reagan National--the 
Metropolitan Washington Airports Authority (MWAA)--raised concerns 
about the airport's ability to accommodate these new beyond-perimeter 
flights as well as their effect on the other Washington, D.C., area 
airports and the ability of MWAA to continue servicing its $5.2 
billion debt. 

The New York City area airports are operating under temporary FAA 
orders, which constitute the current slot control rules that limit the 
number of takeoffs and landings for flights out of those airports. 
However, despite operating under slot control rules, these airports 
continue to be among the most delayed in the country, which in turn 
affects the efficiency of the nation's entire airspace system. 
Moreover, although the rules were designed to control congestion, 
while also maximizing the available airport capacity, some airlines 
seeking entry into these airports assert that the current rules do not 
adequately address inefficient uses of the constrained airspace and 
airport capacity, and that not enough of existing capacity is 
allocated to new entrants, restricting competition and access to the 
primary commercial airports in the region. They also assert that 
airlines currently operating out of these airports use their slots in 
ways that keep out competitors. To address these problems at the New 
York City area airports, FAA, which is responsible for managing 
congestion at airports, tried to implement rules in 2006 (that were 
revised in 2008) that, among other things, would have allowed FAA to 
auction some slots held by incumbents and, under one of the two 
options, keep the proceeds. In October 2009, before implementing any 
changes, FAA rescinded the final congestion management rules for the 
New York City area airports, in general, citing congressional and 
airline opposition to auctioning slots, among other things, and a 
federal court ruling.[Footnote 4] In 2010, the Department of 
Transportation (DOT) began developing a "Slot Management and 
Transparency" rule for JFK, LaGuardia, and Newark to replace the 
temporary slot control rules under which they have been operating 
since 2006 for LaGuardia and since 2008 for JFK and Newark. These 
temporary rules have been extended twice, creating a level of 
uncertainty in the market about when the final rule will be issued and 
what it will contain. 

In response to your request, we reviewed the potential effects of 
increasing the number of beyond-perimeter slot exemptions at Reagan 
National and whether slot control rules at the four U.S. slot-
controlled airports are working to reduce congestion, while maximizing 
available capacity and encouraging competition. 

To review the potential effects of increasing the number of beyond-
perimeter slot exemptions at Reagan National, we: 

* compared the airport's airside capacity assessment with actual usage; 

* reviewed terminal space needs; 

* assessed the effects of the additional beyond-perimeter flights on 
security screening wait times, passenger traffic, capital financing, 
and aircraft noise; and: 

* interviewed officials from FAA, MWAA--which operates Reagan National 
and Dulles International Airport (Dulles)--and Baltimore-Washington 
International Thurgood Marshall Airport (BWI) as well as 
representatives from airlines and others. 

* To review whether slot controls at U.S. slot-controlled airports are 
working to reduce congestion while maximizing available capacity and 
encouraging competition, we compared and contrasted DOT data on flight 
delays, as well as airline schedule data on aircraft size, flight 
frequency, and other factors at slot-controlled airports with airports 
that are not slot-controlled. We also constructed a statistical model 
to assess whether flights at the slot-controlled airports are 
maximizing passenger throughput as compared with other large hub 
airports[Footnote 5] that are not slot-controlled by examining 
aircraft size. We reviewed the reliability of the data used in our 
analyses and concluded that they were sufficiently reliable for our 
purposes. We also interviewed officials from DOT, FAA, the Department 
of Justice (DOJ), MWAA, and the Port Authority of New York and New 
Jersey, which operates the New York City area airports, and 
interviewed representatives from airlines and others. We conducted 
this performance audit from October 2011 to September 2012 in 
accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audits to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objective. We believe that 
the evidence obtained provides a reasonable basis for our findings and 
conclusions based on our audit objectives. More details about our 
scope and methodology of our work are presented in appendix I. 

Background: 

The Washington, D.C., region and New York City area airports vary with 
regard to their size, proximity to downtown areas, and type of service 
provided. In the Washington, D.C., region, Reagan National is located 
in Arlington County, Virginia, near the nation's capital, while the 
two other major airports--Dulles and BWI--that are part of the 
Washington, D.C., area air passenger market are larger and located 
farther from city centers. While Reagan National and BWI primarily 
provide domestic service, about one-fourth of enplanements at Dulles 
in 2011 were international. Reagan National and Dulles are owned by 
the federal government and are operated by MWAA under a 50-year lease 
that has been extended 30 years (1987-2067). Reagan National is 
subject to slot controls, but Dulles and BWI are not. In the New York 
City area, LaGuardia is located in Queens, near Manhattan, and 
primarily provides domestic air service, while JFK and Newark are 
larger airports that are located farther from Manhattan and provide 
more international service. Appendix II provides more detailed 
comparative information about the four slot-controlled airports, plus 
Dulles and BWI. 

On-time flight performance at Reagan National is comparatively better 
than the other slot-controlled airports and cancellations and delays 
at the New York City area airports have been among the worst in the 
nation. According to on-time arrival performance data that airlines 
reported to the Bureau of Transportation Statistics (BTS) for 2011, 
among 29 major airports,[Footnote 6] Reagan National ranked 22nd, JFK 
ranked 25th, LaGuardia ranked 27th, and Newark ranked 29th. Because, 
according to FAA, one-third of the approximately 50,000 aircraft that 
FAA guides through the national airspace system every day move through 
the New York area at some point during a typical day, delays in this 
region can have a disproportionate impact on airspace and airport 
delays experienced throughout the rest of the system. According to 
2012 research conducted by the MITRE Corporation for FAA, one-third of 
the flights in the country are directly affected by delays in the New 
York City and Philadelphia areas. Furthermore, the rate of late 
arrivals and flight cancellations--another indicator of on-time 
performance--at the three New York City area airports was worse than 
the system-wide average during the last 10 years.[Footnote 7] The rate 
of late arrivals and cancellations at Reagan National, however, was 
better than the system-wide average during 4 of the 10 years (see 
figure 1). 

Figure 1: Annual Percentage of Late Arrivals and Flight Cancellations 
at the Four Slot-Controlled Airports Compared with All Airports from 
2002 through 2011: 

[Refer to PDF for image: vertical bar graph] 

Year: 2002; 
Reagan National: 15%; 
JFK: 21%; 
LaGuardia: 20%; 
Newark: 18%; 
Systemwide: 17.7%. 

Year: 2003; 
Reagan National: 19%; 
JFK: 20%; 
LaGuardia: 25%; 
Newark: 28%; 
Systemwide: 17.9%. 

Year: 2004; 
Reagan National: 19%; 
JFK: 24%; 
LaGuardia: 27%; 
Newark: 30%; 
Systemwide: 21.7%. 

Year: 2005; 
Reagan National: 19%; 
JFK: 24%; 
LaGuardia: 27%; 
Newark: 30%; 
Systemwide: 22.4%. 

Year: 2006; 
Reagan National: 24%; 
JFK: 31%; 
LaGuardia: 37%; 
Newark: 38%; 
Systemwide: 24.3%. 

Year: 2007; 
Reagan National: 29%; 
JFK: 38%; 
LaGuardia: 43%; 
Newark: 4%2; 
Systemwide: 26.4%. 

Year: 2008; 
Reagan National: 23%; 
JFK: 32%; 
LaGuardia: 39%; 
Newark: 38%; 
Systemwide: 23.7%. 

Year: 2009; 
Reagan National: 20%; 
JFK: 27%; 
LaGuardia: 32%; 
Newark: 35%; 
Systemwide: 20.3%. 

Year: 2010; 
Reagan National: 21%; 
JFK: 25%; 
LaGuardia: 27%; 
Newark: 28%; 
Systemwide: 20.0%. 

Year: 2011; 
Reagan National: 22%; 
JFK: 25%; 
LaGuardia: 29%; 
Newark: 34%; 
Systemwide: 20.2%. 

Source: GAO presentation of BTS data. 

Note: In this figure, the percentage of delays and cancellations has 
been combined. The system-wide data include the four slot-controlled 
airports. Flights that arrived 15 minutes or more late compared with 
the scheduled time are counted as late arrivals. BTS data do not 
include international flights, which represented about half of the 
enplanements at JFK and about one-third of the enplanements at Newark 
in 2011. 

[End of figure] 

FAA previously relied on its statutory authority to manage airspace 
usage to implement slot controls through an FAA regulation called the 
High Density Rule, which capped the number of hourly arrivals and 
departures permitted at five designated "high density traffic 
airports"--LaGuardia, JFK, Newark, Washington National,[Footnote 8] 
and Chicago O'Hare International--and, among other things, required 
airlines to obtain slots for these operations. The High Density Rule 
was implemented at Reagan National and the three New York City area 
airports in the late 1960s to reduce congestion and delay. Reagan 
National has remained slot-controlled under the High Density Rule 
since 1969, although there have been modifications to the operating 
limits and provisions of the rule throughout the years. On the other 
hand, rules at the New York City area airports have at times been 
relaxed or suspended as a result of statutory changes and FAA actions. 
For example, because of lessened concerns about congestion at Newark, 
FAA suspended slot controls at that airport from 1970 through 2008. In 
addition, in the 1990s, there was some perception that slot controls 
were a barrier to improved service, in part, because new airlines were 
unable to establish service at the slot-controlled airports. 
Subsequently, in 2000, the Wendell H. Ford Aviation Investment and 
Reform Act for the 21st Century required the High Density Rule to be 
phased out at JFK and LaGuardia by January 1, 2007. These 2000 
statutory provisions also directed DOT, in the interim, to grant 
exemptions to the High Density Rule to allow for a limited number of 
flights operated by new entrant airlines and for flights serving small 
communities. As a result, airlines scheduled more flights at LaGuardia 
than the airport could handle without unreasonable delays. FAA 
subsequently issued temporary orders limiting scheduled operations at 
LaGuardia to 75 per hour in 2006 and at JFK and Newark to 81 per hour 
in 2008.[Footnote 9] The limits at LaGuardia were based on the limits 
prior to the 2007 phase-out. In setting the limits on scheduled 
operations at JFK and Newark, FAA undertook an analysis that included 
modeling the estimated level of delay associated with various levels 
of operations. (As shown in figure 1, from 2002 through 2011, the rate 
of late arrivals and flight cancellations at the slot-controlled 
airports and system-wide was greatest in 2007 when slot controls were 
not in effect at JFK and Newark.) 

Before FAA adopted slot allocation and transfer rules, in 1985, 
airlines organized scheduling committees through which slots were 
allocated. In 1986, FAA, believing a secondary market in slots would 
address concerns by new entrant airlines and smaller carriers about 
access to and competition at High Density Rule-controlled airports, 
amended the rule to allow airlines to buy and sell slots. Under the 
temporary orders at the New York City area airports, imposed after the 
statutory expiration of the High Density Rule at JFK and LaGuardia, 
FAA allocated slots to airlines based on their current operating 
schedules at those airports in conjunction with voluntary airline 
schedule-reduction agreements or, in the case of LaGuardia, based on 
their current slot or slot exemptions holdings. To encourage 
competition at these airports under the High Density Rule, Congress 
also has periodically directed DOT to allocate slots exemptions to 
airlines operating new service at slot-controlled airports. Generally, 
once airlines have been allocated slots or slot exemptions, so long as 
they comply with the rules, they may keep them indefinitely[Footnote 
10] and consider them to be valuable assets.[Footnote 11] 

Although slot controls were designed to manage congestion by limiting 
the number of scheduled flight operations per hour at each of these 
airports, the rules also contain a provision designed to encourage use 
of airport capacity by requiring airlines to use their slots a minimum 
percentage of the time. Beginning in 1986, FAA's High Density Rule 
required airlines at specified airports to use their slots at least 65 
percent of the time, but starting in 1992, they were required to use 
them at least 80 percent of the time. Although the 80 percent usage 
requirement is applicable to all four slot-controlled airports, other 
provisions of the rules differ between the airports, including: 

* the hours when airlines are required to have a slot to operate a 
flight, 

* the time periods for which slots usage is measured and reported to 
FAA, and: 

* whether airlines can buy or sell slots (see table 1). 

In general, at Reagan National and LaGuardia, slots are allocated for 
every day of the week and must be used at least 80 percent of time in 
a fixed, 2-month reporting period (e.g., January-February, March-
April, etc.).[Footnote 12] At JFK and Newark, slots are allocated for 
a specific day of the week and must be used at least 80 percent of the 
time for that day during a scheduling season.[Footnote 13] Slots not 
used in accordance with the 80 percent rule are subject to withdrawal 
by FAA. Additionally, because the slot rules at the New York City area 
airports are contained in temporary FAA orders and are not considered 
by FAA to be a long-term solution, slots may not be bought or sold at 
those airports.[Footnote 14] Slots may be leased and traded, however, 
at any of the slot-controlled airports. 

Table 1: Selected Slot Control Rule Provisions for the Four U.S. Slot-
Controlled Airports: 

Minimum slot usage requirement; 
Reagan National: 80 percent; 
LaGuardia: 80 percent; 
JFK: 80 percent; 
Newark: 80 percent. 

Hours that airport is slot-controlled; 
Reagan National: All hours; 
LaGuardia: 6:00 a.m. to 9:59 p.m., Eastern Time, Monday - Friday and 
12:00 p.m. to 9:59 p.m., Eastern Time, Sunday; 
JFK: 6:00 a.m. to 10:59 p.m., Eastern Time, daily; 
Newark: 6:00 a.m. to 10:59 p.m., Eastern Time, daily. 

Usage measured for…; 
Reagan National: All days over 2-month reporting period; 
LaGuardia: All days over 2-month reporting period; 
JFK: Each day of the week over a scheduling season[A]; 
Newark: Each day of the week over a scheduling season[A]. 

Authorization to buy or sell slots; 
Reagan National: Allowed; 
LaGuardia: Not authorized; 
JFK: Not authorized; 
Newark: Not authorized. 

Authorization to lease or trade slots; 
Reagan National: Allowed; 
LaGuardia: Allowed; 
JFK: Allowed; 
Newark: Allowed. 

Source: FAA and FAA regulations: 

[A] Slots that are not operated because the airline returned them to 
FAA prior to that season's return deadline are not counted as unused 
for purposes of measuring slot usage. Airlines can return to FAA slots 
during periods of a season that the airline does not intend to operate. 

[End of table] 

According to FAA officials, the differences in the rules for each 
airport are largely a product of history. For example, when FAA 
replaced the High Density Rule with temporary limitations on flight 
operations at LaGuardia in 2007, it adopted most of the rule's 
provisions including, most importantly, the slot caps. Long-term 
changes were expected through a proposed rule issued by FAA in the 
summer of 2006. Additionally, according to an FAA official and 
International Air Transport Association (IATA) representatives, 
because JFK and Newark support a large number of international 
operations, the rules for those airports are more consistent with 
IATA's Worldwide Slot Guidelines. These guidelines contain slot 
processes and policies for slot-controlled airports to facilitate 
international operations to or between other slot-controlled airports 
around the world. 

FAA and DOT's Office of the Secretary share responsibility for 
managing slot control issues. FAA is responsible for administering the 
slot rules, which primarily includes slot allocation, transfers, and 
monitoring and enforcing airlines' compliance with the 80 percent slot 
usage requirement. DOT's Office of the Secretary is responsible for 
awarding within-perimeter and beyond-perimeter slot exemptions at 
Reagan National and monitoring competitive aspects of the airlines' 
slot holdings. 

In 2006, FAA proposed a congestion management rule for LaGuardia that 
would limit operations, encourage the use of larger aircraft, and 
assign rolling expiration dates for slots. That notice of proposed 
rulemaking was withdrawn and superseded in 2008 by congestion 
management rules at JFK, LaGuardia, and Newark that would have created 
a market by annually auctioning a limited number of slots in each of 
the first 5 years of the rule, which had a 10-year term. In October 
2009, before the terms of the 2008 rules became effective, FAA 
rescinded the rules citing, among other things, that the rulemakings 
had been highly controversial, and a court challenge that resulted in 
a December 2008 stay of the rules by the United States Court of 
Appeals for the District of Columbia Circuit. In addition, because of 
the complexity of the issues, the impact of an Omnibus Appropriations 
Act, 2009 provision,[Footnote 15] and the possible impact of the 
significantly changed economic circumstances on the slot auction 
program, FAA believed it was better to rescind the rule rather than 
propose to extend it. According to DOT's Office of the Secretary and 
FAA, their Slot and Management Transparency notice of proposed 
rulemaking currently being drafted will propose to replace the current 
temporary orders limiting scheduled operations at JFK, LaGuardia, and 
Newark with a permanent rule to address congestion and delay, while 
also promoting fair access and competition, including establishing a 
secondary market that would allow airlines to buy and sell slots at 
the New York City area airports.[Footnote 16] 

In 2009, because airlines are prohibited from selling or purchasing 
slots under the temporary order at LaGuardia, Delta Air Lines and US 
Airways sought a waiver from DOT's Office of the Secretary and FAA 
from this prohibition to exchange slots at LaGuardia and Reagan 
National because Delta wanted to establish a domestic hub at LaGuardia 
and US Airways wanted to increase service at Reagan National. In 2011, 
DOT's Office of the Secretary and FAA together granted the joint 
waiver request that permitted the transfer and sale of more than 300 
slots between the two airlines, provided that they divest a total of 
48 slots (24 slot pairs) at Reagan National and LaGuardia to new 
airline entrants and airlines holding less than 5 percent of the slots 
at those airports. After the slot swap, Delta Air Lines increased its 
share of slot holdings at LaGuardia from 24 percent in April 2011 to 
44 percent in May 2012 and US Airways increased its share of slot 
holdings at Reagan National from 31 percent in April 2011 to 54 
percent in May 2012. The divestiture effort, conducted through a blind 
sale open to new entrants and limited incumbents only, resulted in 
JetBlue attaining 16 slots at LaGuardia for $32 million and 16 slots 
at Reagan National for $40 million, and WestJet attaining 16 slots at 
LaGuardia for $17.6 million. Under the terms of the slot swap, US 
Airways and Delta were to receive the proceeds from the sale of their 
divested slots. 

DOJ is responsible for enforcing antitrust laws for most sectors of 
the economy, including the airline industry. According to DOJ 
officials, this includes reviewing competitive aspects of airlines' 
holdings at slot-controlled airports. For example, transactions that 
increase concentration of slot holdings may substantially lessen 
competition in violation of the antitrust laws. In 2010, DOJ offered 
formal comments in support of the tentative decision by DOT's Office 
of the Secretary and FAA to condition approval of the slots transfer 
between Delta Air Lines and US Airways with regard to the airlines' 
slot holdings at LaGuardia and Reagan National on the airlines 
divesting a certain number of slots. While DOJ did not take action to 
block the slot swap, DOJ officials told us in June 2012 that they are 
still reviewing competitive aspects of the airlines' slot holdings at 
Reagan National following completion of the revised slot swap. 

In addition to slot controls, Reagan National and LaGuardia are 
subject to perimeter rules, which limit nonstop flights serving these 
airports to a distance of 1,250 and 1,500 miles,[Footnote 17] 
respectively. While LaGuardia's perimeter rule is imposed by the 
airport's operator, the perimeter rule at Reagan National is 
statutory.[Footnote 18] Two federal laws--the Wendell H. Ford Aviation 
Investment and Reform Act for the 21st Century (AIR-21)[Footnote 19] 
in 2000 and the Vision 100-Century of Aviation Reauthorization Act 
(Vision 100)[Footnote 20] in 2003--increased the number of slot 
exemptions at Reagan National and for the first time required 
exemptions to be granted to the Reagan National perimeter rule known 
as "beyond-perimeter" slot exemptions. These laws required the 
Secretary of Transportation to grant exemptions to the existing rules, 
adding 44 slot exemption operations (22 round trips) per day during a 
15-hour period and requiring 24 (12 round trips) of these slot 
exemptions to be granted for beyond-perimeter flights.[Footnote 21] In 
February 2012, the FAA Modernization and Reform Act of 2012[Footnote 
22] required the Secretary of Transportation to grant 8 additional 
beyond-perimeter slots exemptions (4 round trips) at Reagan National. 
The 2012 act, similar to AIR-21 in 2000 and Vision 100 in 2003, 
required DOT, in awarding the slot exemptions, to consider specified 
criteria in granting beyond-perimeter exemptions. The 2012 act 
required the consideration of issues such as their impact on providing 
network benefits (connecting flights) outside of the perimeter and 
passenger service to small communities. In May 2012, to implement the 
requirements of the FAA Modernization and Reform Act, DOT awarded the 
beyond-perimeter slot exemptions to airlines proposing to provide 
nonstop service between Reagan National and Austin, Texas; Portland, 
Oregon; San Francisco, California; and San Juan, Puerto Rico. The act 
also authorized the four incumbent carriers at Reagan National to each 
convert two slots that were being used for flights to large hubs 
within the perimeter, to two slot exemptions for nonstop flights 
beyond the perimeter. Accordingly, four round trips were suspended to 
large hubs and four new round trips were initiated instead to Los 
Angeles, San Diego, and San Francisco, California, and Salt Lake City, 
Utah (using a total of eight slot exemptions) (see figure 2). 

Figure 2: Nonstop Beyond-Perimeter Slot Exemption Destinations from 
Reagan National from 2000 through 2012: 

[Refer to PDF for image: illustrated U.S. map] 

Slot exemptions granted between 2000 and 2004 for nonstop air service 
beyond the 1,250-mile perimeter: 
Seattle, WA: 2 round trips (Alaska Airlines); 
Salt Lake City, UT: 1 round trip (Delta Air Lines); 
Denver, CO: 3 round trips (Frontier Airlines) and	one nonstop round 
trip (United Airlines); 
Las Vegas, NV: 1 round trip (US Airways); 
Los Angeles, CA: 1 round trip (Alaska Airlines); 
Phoenix, AZ: 3 round trips (US Airways). 

Slot exemptions granted in 2012 for nonstop air service beyond the 
1,250-mile perimeter: 
Portland, OR: 1 round trip (Alaska Airlines); 
San Francisco, CA: 1 round trip (Virgin America); 
Austin TX: 1 round trip (Southwest Airlines); 
San Juan, PR: 1 round trip (Jet Blue Airways). 

Beyond-perimeter slot exemptions for nonstop air service converted in 
2012 from within-perimeter slots: 
Los Angeles, CA: 1 round trip (American Airlines); 
Salt Lake City, UT: 1 round trip (Delta Air Lines); 
San Diego, CA: 1 round trip (US Airways); 
San Francisco, CA: 1 round trip (United Airlines); 

Sources: DOT and Map Resources. 

[End of figure] 

Appendix III provides more detailed information about the 
implementation of slot controls and perimeter rules, the proposed Slot 
Management and Transparency rule, and the slots transfer between Delta 
Air Lines and US Airways. 

Reagan National Can Accommodate New Beyond-Perimeter Flights, Which 
Are Likely to Have a Limited Effect on Other Washington, D.C., Area 
Airports: 

Reagan National has sufficient airside (runway) capacity to 
accommodate the new nonstop beyond-perimeter flights. The airport's 
terminal and landside facilities are more constrained, but with some 
improvements and adjustments, it will also have sufficient terminal 
capacity. The new flights are also likely to have limited effects on 
passenger security screening wait times, passenger traffic at the 
other Washington, D.C., area airports, MWAA's ability to service its 
debt, and aircraft noise. In addition, the low cost airlines that will 
be operating half of the new beyond-perimeter flights at Reagan 
National will increase airline competition on those routes. 

Airside Capacity: 

Reagan National is routinely operating below the maximum authorized 67 
hourly takeoffs and landings (slots) and the 67.6 hourly takeoffs and 
landings that a 2011 FAA capacity analysis indicated could be 
accommodated based only on average runway capacity.[Footnote 23] While 
67 is the maximum number of hourly takeoffs and landings authorized in 
any one hour, the number of slots and slot exemptions authorized on a 
daily basis is generally less than 67 per hour, on average. Table 2 
shows the maximum number of hourly takeoffs and landings allowed at 
Reagan National, broken down by the type of aircraft operations. 

Table 2: Hourly Aircraft Operations (Takeoffs and Landings) Allowed at 
Reagan National: 

Type of aircraft operations: Air carrier[A]; 
Maximum number of takeoffs and landings (slots) allowed per hour: 37. 

Type of aircraft operations: Commuter aircraft operations[B]; 
Maximum number of takeoffs and landings (slots) allowed per hour: 11. 

Type of aircraft operations: General aviation and unscheduled flights; 
Maximum number of takeoffs and landings (slots) allowed per hour: 12. 

Type of aircraft operations: Slot exemptions[C]; 
Maximum number of takeoffs and landings (slots) allowed per hour: 5. 

Type of aircraft operations: Slides[D] (allowing slots to be used in 
different time periods); 
Maximum number of takeoffs and landings (slots) allowed per hour: 2. 

Type of aircraft operations: Total[E]; 
Maximum number of takeoffs and landings (slots) allowed per hour: 67. 

Source: 14 C.F.R. § 93.123, 49 U.S.C. § 41718(c)(2)(A)(ii), 49 U.S.C. 
§ 41714(d)(1) and FAA. 

[A] Under FAA slot control regulations applicable to Reagan National, 
"air carrier slots" are intended for operations with turboprop and 
reciprocating engine aircraft with 75 or more seats or turbojet 
aircraft with 56 or more seats. However, air carrier slots may be used 
for operations using aircraft of any size. FAA officials estimated 
that 30 to 40 percent of air carrier slots are operated in commuter 
aircraft slots based on a review of published schedules and the number 
of commuter aircraft operated above the commuter slot quota. 

[B] Under FAA slot control regulations applicable to Reagan National, 
"commuter slots" may be used only for operations with turboprop and 
reciprocating engine aircraft with no more than 76 seats or turbojet 
aircraft with fewer than 56 seats. 

[C] These are exemptions to the hourly restrictions at Reagan National 
that are authorized by statute. 

[D] Under 49 U.S.C. § 41714 (d)(1), the Secretary of Transportation is 
authorized to grant certain exemptions from specified slot rules 
applicable to Reagan National. For example, under this authority the 
Secretary may grant exemptions from hourly limitations on slots at 
Reagan National but may not increase the number of aircraft operations 
in any 1-hour period by more than 2 operations. FAA may not grant more 
than 2 exemptions for a 1-hour period. FAA uses this authority to 
consider requests for what are referred to as a grant "slot-slides," 
which would allow slots allocated for certain hours to be reassigned 
and used in a different slot periods. 

[E] Regulatory limits are 60 per hour. However, slot exemptions are 
authorized by statute to increase hourly operations by up to 5 in an 
hour, but only between 7:00 a.m. and 9:59 p.m. In addition, slot 
slides may also increase operations but under statute (1) may not 
result in an increase in the total number of slots per day, (2) may 
not result in an increase in the total number of slots from 7:00 a.m. 
to 9:00 p.m., and (3) may not increase operations in any 1-hour period 
by more than two operations. FAA has not modeled the delay impact of 
67 operations in each hour. 

[End of table] 

Our analysis of FAA data found that a maximum of about 53 slots was 
allocated and used per hour at Reagan National, compared with the 67 
hourly takeoffs and landings that are generally permitted. 
Specifically, FAA reported that a maximum of 52 slots in one hour was 
allocated for airline and commuter operations in April 2012 and an 
average of about 1 aircraft operation per hour was used for general 
aviation or unscheduled aircraft operations from May through August 
2011.[Footnote 24] The new beyond-perimeter flights will cause the 
largest increase in the maximum number of slot allocations for airline 
and commuter aircraft operations from 4:00 p.m. to 6:59 p.m., when the 
number of slot allocations will increase by 2 per hour.[Footnote 25] 
Table 3 shows the impact of the new beyond-perimeter flights on slot 
allocations during peak and nonpeak hours. 

Table 3: Impact of New Beyond-Perimeter Exemptions on Average Peak and 
Non-Peak Hour Slot Allocations at Reagan National for the Summer 2012 
Season: 

Type of aircraft operations: Airline and commuter operations[C]; 
Average number of slots allocated per hour during peak hours[A]: 51.3; 
Average number of slots allocated per hour during peak hours[A] 
including the new beyond-perimeter flights[B]: 52.5; 
Average number of slots allocated per hour during nonpeak hours: 45.6; 
Average number of slots allocated per hour during nonpeak hours 
including the new beyond-perimeter flights[B]: 45.7. 

Source: GAO analysis of FAA data. 

[A] Peak hours used in this analysis are from 7:00 a.m. to 10:00 a.m. 
and from 4:00 p.m. to 7:00 p.m. 

[B] New beyond-perimeter slots that Congress authorized in February 
2012. 

[C] Based on FAA data regarding slot holders for Thursdays for the 
summer 2012 season as of April 5, 2012. 

[End of table] 

Much of the difference between the maximum number of hourly aircraft 
operations authorized and the average number of slots allocated and 
used can be attributed to a substantial decrease in general aviation 
and unscheduled aircraft operations at Reagan National after the 
September 11, 2001, terrorist attacks. After the 2001 terrorist 
attacks, TSA imposed security restrictions on general aviation 
operations operating at Reagan National, such as requiring an armed 
security officer to be on board all flights. Before the attacks, there 
were about 210 general aviation and unscheduled flights per day at 
Reagan National. By comparison, FAA indicated that there were about 17 
general aviation and unscheduled flights per day at Reagan National in 
2011.[Footnote 26] Of the 60 authorized hourly slots at Reagan 
National, excluding any slot exemptions, 12 are allocated for general 
aviation aircraft operations or other aircraft that do not operate on 
a scheduled basis. However, from May through August 2011, an average 
of about 1 of the 12 allocated slots was used per hour. Although 
airlines with large commercial aircraft could not necessarily use the 
slots reserved for smaller general aviation aircraft and unscheduled 
flights, which may use the airport's shorter runways and do not 
generally use airport gates and terminal infrastructure, the reduced 
amount of overall general aviation traffic leaves some airport 
capacity unused. In addition, some slots are available at Reagan 
National during nonpeak hours because airlines are primarily 
interested in obtaining slots at peak hours. FAA indicated that, for 
July and August 2012, 34 airline and 12 commuter slots were available, 
all at early morning (6:00 a.m.) or late evening (10:00 p.m. or 11:00 
p.m.) hours.[Footnote 27] 

Terminal Capacity: 

Although Reagan National has sufficient airside capacity to 
accommodate the new beyond-perimeter flights, the airport has more 
limited terminal capacity, which includes space for gates, ticket 
counters, baggage handling, and security screening. As of May 2012, 
two of the new beyond-perimeter round trips (those operated by Jet 
Blue and Southwest Airlines) are expected to be operated out of 
Terminal A, the airport's original terminal that opened in 1941, and 
two of the new beyond-perimeter round trips (those operated by Virgin 
America, which is the airport's only new airline entrant among the 
operators of the new beyond-perimeter flights, and Alaska Airlines) 
are expected to be operated out of the newer Terminal B/C, which 
opened in 1997. To help accommodate as many as 1,245 additional daily 
passengers who could fly on the new beyond-perimeter flights, MWAA is 
planning to expand baggage and security screening space in Terminal A 
and complete those improvements by the summer of 2013. An MWAA 
official said these improvements were already needed to address 
increased passenger volume and complexity of operations in Terminal A. 
For example, seven airlines, each with its own needs for space in 
Terminal A,[Footnote 28] are now operating separate, uncoordinated 
schedules, compared with a few years ago when one dominant airline and 
a few smaller airlines were operating there. No improvements will be 
needed to accommodate the new beyond-perimeter flights in Terminal 
B/C. MWAA estimated that improvements in Terminal A will cost about 
$45.6 million, which will be financed through bond funds and airline 
leases. However, an MWAA official added that these improvements do not 
allow for any additional growth in Terminal A, which could, if needed, 
require replacing the terminal at a cost of several hundred million 
dollars. 

Gate Usage: 

Based on current gate usage rates at Reagan National, on average, 
gates will be fully used. MWAA data indicated that airlines operating 
at Reagan National will average 7.7 turns per day for each gate. This 
is in the range of six to eight daily turns per gate that was defined 
as full gate utilization in a 2010 Transportation Research Board 
study[Footnote 29] on common-use gates. That report also indicated 
that full gate utilization may be affected by noise restrictions 
limiting the hours of operations or other factors that may vary 
according to the airline using the gate. Exceeding full gate 
utilization could lead to flight delays. 

Passenger Security Screening: 

We asked TSA to estimate the impact of the new beyond-perimeter 
flights on passenger security screening wait times at Reagan National 
using the agency's security screening throughput model. TSA's model 
suggested that the impact of the new beyond-perimeter flights on 
passenger security screening wait times would be minimal.[Footnote 30] 
However, an MWAA official said that until improvements to the security 
screening space in Terminal A are completed next summer, passengers 
may need to wait longer to be screened at that checkpoint. 

Airport Access and Parking: 

The additional beyond-perimeter flights are not expected to affect 
access to the airport or parking, considering that the maximum number 
of additional passengers that the new flights could generate 
represents about 5 percent of the airport's total daily enplanements. 
According to a survey of air passengers in the Washington, D.C., and 
Baltimore area, 16 percent of Reagan National passengers arrive by 
Metrorail, which is among the highest public transportation rates in 
the nation for airport access, 74 percent of passengers arrive by car 
(private and rental) or taxi, and the remaining 10 percent arrive by 
shuttle bus or Metrobus.[Footnote 31] MWAA provided data showing that 
since parking facilities were expanded since 2009, the number of times 
that lots have been filled to capacity has dropped considerably. The 
data indicated that in 2011, the airport's parking lots were filled to 
capacity approximately 38 times, compared with 2009, when they were 
filled to capacity a total of 353 times. According to MWAA, from 
January through May 2012, the parking lots were filled to capacity 13 
times. However, an MWAA official said that the impact of the new 
beyond-perimeter slot exemptions should not be considered in isolation 
and that the sale of slots to JetBlue under the Delta-US Airways slots 
swap earlier in 2011 has had a more pronounced effect. For example, 
the official said that since more JetBlue flights began operating out 
of Terminal A in June 2012, the economy parking lot has been filled to 
capacity an average of 4 days a week. In providing comments on a draft 
of this report, MWAA indicated that during the first 8 months of 2012, 
the economy parking lot has been filled to capacity more than 60 
times, which was more than double the number of times that the lot was 
forced to close in 2011. 

Impact on Other Airports in the Washington, D.C., Area: 

Our analysis found that the beyond-perimeter flights authorized in 
February 2012 could add between zero (assuming that no new passengers 
shift from using other airports) and a maximum of 1,245 daily 
enplanements (departing passengers) at Reagan National.[Footnote 32] 
Longstanding policy designed to guide the operation of Reagan National 
and Dulles, as well as agency rules designed to implement such policy, 
have included the roles of Reagan National in providing short-haul 
domestic service and Dulles in providing all types of service. 
[Footnote 33] In addition, under the policy, MWAA is to promote the 
"better utilization" of Dulles, which was underutilized for many years 
after opening in 1962. During our review, MWAA and BWI officials 
expressed concern about the possible impact of the new beyond-
perimeter flights at Reagan National on passenger traffic at Dulles 
and BWI. We found, on the basis of 2011 enplanement data, that if all 
of the new beyond-perimeter flights are 100 percent full, the number 
of enplanements on those flights would represent an increase of about 
5 percent of annual enplanements at Reagan National. Correspondingly, 
Dulles or BWI would lose a maximum of 4.1 percent of their 
enplanements, respectively, if all the passengers changed from using 
either of these two airports to using Reagan National. Therefore, if 
all the passengers changed from using Dulles or BWI, the new beyond-
perimeter flights are likely to have some impact on passenger traffic 
at these airports. However, it is extremely unlikely that all of these 
passengers would shift from using one airport; instead, any loss 
likely would be shared between Dulles and BWI. In addition, the 
airports are not perfect substitutes for Reagan National, so it is 
unlikely that all the passenger traffic would shift from Dulles or 
BWI. But, even in the worst case, a 4.1 percent change is less than 
the growth expected at these airports over the next 2 or 3 years. The 
actual impact of the new beyond-perimeter flights at Reagan National 
on passenger traffic at the other Washington, D.C., area airports 
cannot be quantified because all of the new flights did not start 
until August 2012 and because of unknown factors such as how competing 
flights will be priced, how the new direct flights at Reagan National 
will draw passengers from the area airports, how other airlines may 
adjust their schedules, and the extent to which the new flights may 
generate new passenger demand on those routes. 

We found no evidence that the previously added beyond-perimeter 
flights at Reagan National had affected passenger traffic or airfares 
at the surrounding airports. We found two cases--one in 2005 and 
another in 2012[Footnote 34]--when airlines discontinued or planned to 
discontinue service between Dulles and beyond-perimeter destinations 
after they were awarded new beyond-perimeter slot exemptions at Reagan 
National, but any shift in passenger traffic, as noted above, 
represented about 4 percent of overall passenger traffic. (Figures 8 
through 31 in appendix IV show trends in average annual passenger 
traffic and airfares at BWI and Dulles for destinations granted beyond-
perimeter slot exemptions at Reagan National under AIR-21 and Vision 
100 between 2000 and 2004). Moreover, any deviation in airfares after 
the initiation of the slot exemptions at Reagan National could be a 
result of many factors, such as airline bankruptcies and mergers. 
Additionally, the presence of low cost airlines on the newly-awarded 
beyond-perimeter flights will increase competition on those routes and 
could help reduce airfares to those destinations. However, of the four 
new nonstop beyond-perimeter destinations, only one low cost airline 
(Virgin America) will be competing with a legacy airline (United 
Airlines) in providing service between Reagan National and San 
Francisco. 

Financial Impact on MWAA: 

If the new beyond-perimeter flights cause passengers to shift from 
using Dulles to using Reagan National, it could increase per passenger 
airline costs of using Dulles, which, if substantial, could cause the 
airlines to reduce service at the airport. To better understand the 
potential financial impact of possible changes in passenger traffic 
resulting from the new beyond-perimeter exemptions, we asked MWAA to 
estimate the flights' impact on the cost per enplaned 
passenger,[Footnote 35] which is a generalized measure of airline's 
airport charges, assuming a worst case scenario. Assuming all of the 
passengers on the new beyond-perimeter flights shifted from using 
Dulles to using Reagan National--the worst case scenario--and all 
other factors stayed the same, MWAA's analysis found that the cost per 
enplaned passenger would increase at Dulles in 2013 by $1.10, or 3.9 
percent, and increase in 2014 by $1.51 or 5.7 percent, and decrease at 
Reagan National in 2013 by $0.58, or 4.4 percent, and decrease in 2014 
by $0.89, or 6.5 percent (see table 4). These results show that 
because the same costs, most of which are fixed costs, would be spread 
among fewer passengers at Dulles and more at Reagan National so that 
the cost per enplaned passenger would change accordingly. However, 
even in the worst case, the changes would be relatively small. 

Table 4: Projected Impact of the New Beyond-Perimeter Flights at 
Reagan National on the Cost per Enplaned Passenger in 2013 and 2014: 

Airport: Reagan National; 
Projected 2013 cost per enplaned passenger: $13.23[A]; 
Projected 2013 cost per enplaned passenger with new beyond-perimeter 
flights: $12.65; 
Projected 2014 cost per enplaned passenger: $13.70[B]; 
Projected 2014 cost per enplaned passenger with new beyond-perimeter 
flights: $12.81. 

Airport: Dulles; 
Projected 2013 cost per enplaned passenger: $27.99[C]; 
Projected 2013 cost per enplaned passenger with new beyond-perimeter 
flights: $29.09; 
Projected 2014 cost per enplaned passenger: $26.61[D]; 
Projected 2014 cost per enplaned passenger with new beyond-perimeter 
flights: $28.12. 

Source: MWAA: 

[A] Based on projected enplanements of 9,765,000. 

[B] Based on projected enplanements of 9,850,000. 

[C] Based on projected enplanements of 12,095,000. 

[D] Based on projected enplanements of 12,415,000. 

[End of table] 

In recent years, the cost per enplaned passenger has increased 
substantially at Dulles, owing to a major capital development project 
at the airport, while it has decreased slightly at Reagan National. 
From 2010 to the first half of 2012, the cost per enplaned passenger 
at Dulles increased from $17.16 to $26.03 or 51.7 percent, but 
decreased at Reagan National from $12.84 to $12.74, or 0.8 percent. 
Airline representatives generally told us that an airport's cost as 
measured by cost per enplaned passenger is among many factors that 
they consider when deciding whether to provide service there. However, 
representatives from one large airline said that if the cost per 
enplaned passenger at Dulles and other costs such as fuel continue to 
increase, it would consider reducing or canceling its service there. 
MWAA officials also said that, given the recent substantial increases 
in the cost per enplaned passenger at Dulles, some airlines may stop 
serving the airport, particularly in providing domestic service, and 
that an increase of even one dollar in the cost per enplaned passenger 
is significant.[Footnote 36] In a recent credit-rating report on MWAA 
prepared in September 2011, before the new beyond-perimeter flights 
were awarded, one agency had a negative outlook on the authority's 
rating because of expected significant increases in the cost per 
enplaned passenger and lower debt service coverage over the next 5 
years. However, two other credit-rating agencies reported in September 
2011 their ratings outlooks for MWAA were stable, citing the strong 
air passenger market in the Washington, D.C., area. Moreover, recent 
increases in the cost per enplaned passenger at Dulles were not due to 
significant shifts in passenger traffic. From 2010 through 2011, 
enplanements at Dulles decreased by about 2 percent, while they 
increased at Reagan National by about 3.6 percent. However, from 2010 
and 2011, international enplanements--which generate higher airport 
revenues because airline fees are based in part on aircraft weight, 
and aircraft used for international flights are generally larger and 
heavier--increased at Dulles by more than 4 percent and represented 28 
percent of all enplanements in 2011. In addition, in a forecast of 
airport activity from 2011 to 2040, FAA ranked Dulles second among 30 
major U.S. airports in terms of projected increases in enplanements, 
with a projected annual growth rate of 3.9 percent. FAA projected that 
from 2011 to 2040, enplanements at Dulles will increase by 215 
percent, compared with 34 percent at Reagan National and 110 percent 
at BWI.[Footnote 37] 

Under current lease agreements between MWAA and its incumbent 
airlines, debt costs are not shared between the two airports which 
could make servicing the much larger debt at Dulles difficult if 
revenue declines at Dulles were substantial. MWAA currently maintains 
$5.2 billion in long-term debt.[Footnote 38] Much of MWAA's debt was 
incurred for recent major capital improvements at Dulles, such as an 
automated train system[Footnote 39] connecting the main terminal to 
gates and construction of a fourth runway. According to an MWAA 
official, about $3.8 billion of the $5.2 billion in total debt is 
allocated to Dulles and about $1.4 billion is allocated to Reagan 
National.[Footnote 40] MWAA officials are concerned about the 
financial impact of the new beyond-perimeter flights on the 
authority's ability to service its debt at Dulles, because revenues 
and debt service charges for Reagan National and Dulles are maintained 
separately.[Footnote 41] According to MWAA officials, in the event 
that one of the two airports could not pay its debt, the lease 
agreements contain an "extraordinary coverage protection payments" 
provision designed to allow for the sharing of debt service between 
the two airports. More specifically, according to MWAA officials, if 
Dulles could not continue paying its debt service, the use of the 
extraordinary coverage provision by the authority could have the 
impact of mitigating airline rates and charges at Dulles and, in turn, 
could mitigate a cost per enplaned passenger increase at Dulles and 
cause a corresponding increase in the cost per enplaned passenger at 
Reagan National. However, an MWAA official said that the airports 
authority does not expect that this provision will be triggered before 
the current lease agreements expire in the fall of 2014. In addition, 
the MWAA official said the inclusion of this provision in the new 
leases is a matter that will be negotiated with the airlines. 

With respect to MWAA's authority to generate additional revenues that 
could help mitigate the cost per enplaned passenger in the future, the 
FAA Modernization and Reform Act of 2012 amended the definition of the 
"airport purposes" that MWAA may engage in to include "a business or 
activity not inconsistent with the needs of aviation that has been 
approved by the Secretary."[Footnote 42] An MWAA official said that, 
pursuant to this authority, the airport authority plans to develop 
land near Dulles for warehouses, cargo-related integrators, freight 
forwarders, and general aviation. However, the official added that the 
property first needs to undergo an environmental impact review, which 
could take 2 to 3 years, and that new revenues from the development 
are not expected to have an impact on airline lease rates in the next 
3 to 7 years. 

Aircraft Noise: 

Although some members of the community surrounding Reagan National 
expressed limited concerns about the additional aircraft noise that 
the new beyond-perimeter flights could generate, FAA and airport 
officials indicated that the relatively small number of flights being 
added will not have a significant overall effect on aircraft noise. 
Concerns about noise affecting nearby residential areas were a primary 
reason why Reagan National became subject to the perimeter rule in the 
1960s, when aircraft were noisier than they are today. We interviewed 
individuals from community organizations concerned about aircraft 
noise at Reagan National as well as officials from the Washington 
Council of Governments, the Arlington County (Va.) Council, MWAA, and 
FAA about the possible impact on aircraft noise from the new beyond-
perimeter flights. Individuals from community organizations said they 
were concerned about aircraft noise at the airport as a whole and that 
continuing to add more beyond-perimeter flights has a cumulative 
negative effect. The Washington Council of Governments opposed 
changing the slot or perimeter rules at Reagan National, which the 
organization indicated are important tools in helping to manage the 
volume of air traffic at the airport and the impact on aircraft noise 
on the surrounding community. In addition, the Arlington County 
Council official said that people would notice noise from the new 
flights if they were added in the early morning or late evening hours. 
However, MWAA and FAA officials said that the additional beyond-
perimeter flights are not expected to cause a noticeable increase in 
aircraft noise because they constitute only 8 of about 800 daily 
flights at Reagan National, or about 1 percent, of the total daily 
aircraft operations. They also noted that aircraft make less noise 
than they did in the past and that the types of aircraft being used or 
planned to be used for the new beyond-perimeter flights (Airbus 319s 
and 320s and Boeing 737s) tend to be newer and quieter. An MWAA noise 
abatement official also said and that in February 2012, a new advanced 
navigational procedure was implemented for northbound departures at 
Reagan National, which is designed for aircraft to follow the river 
and fly less directly over homes. FAA and MWAA officials also said 
that because of the technological advances, noise contours, which 
highlight areas of significant aircraft noise exposure surrounding the 
airport, have generally shrunk and that while noise from the new 
beyond-perimeter flights would be noticeable individually, the 
relatively small number of new beyond-perimeter flights being added as 
a whole is not significant enough to require updating the airport's 
noise compatibility study.[Footnote 43] 

MWAA, which monitors noise at Reagan National, provided data showing 
that in 2011, it received 505 complaints from 117 callers, 255 of 
which came from 5 callers, compared with 197 complaints in 2010 and 99 
complaints in 2009. An MWAA official attributed the increased number 
of complaints to construction on the main runway last year, which is 
now complete. During construction, pilots took a different flight path 
over residential areas at night, rather than following the normal path 
along the Potomac River. 

Slot Control Rules Help Manage Congestion, but Allowing Airlines Not 
to Use Some Slots May Hinder Competition: 

Slot Control Rules Help FAA Manage Congestion: 

Even though the New York City area airports still experience some of 
the worst delays in the country, the delay situation at these airports 
would be far worse in the absence of slot controls.[Footnote 44] The 
best example of what would occur without slot controls at New York 
City area airports occurred in 2000 when a then-new federal law 
required the Secretary of Transportation to grant exemptions to the 
High Density Rule at JFK and LaGuardia to new entrant airlines and for 
service to small communities with small regional jets.[Footnote 45] 
Soon after, qualifying airlines requested more than 600 new slot 
exemptions at LaGuardia and by September 2000, 25 percent of the 
flight delays in the United States were attributed to congestion at 
LaGuardia. FAA reports that after it again capped the number of 
scheduled takeoffs and landings at LaGuardia in 2001, aircraft delays 
of 15 minutes or more fell from 330 per day in October 2000 to 98 per 
day in April 2001.[Footnote 46] In setting operating limits at JFK and 
Newark in 2008, FAA conducted analyses with the goal of reducing 
average departure delays at JFK by about 15 percent compared with 
their 2007 level, and to keep delays at Newark from increasing above 
their 2007 level.[Footnote 47] Airline representatives with whom we 
spoke mostly agreed that some form of slot controls are needed at the 
four airports to manage congestion. However, representatives from two 
airlines believed that if slot controls were lifted, congestion 
initially would spike, but airlines would eventually make the 
adjustments needed to reach a level of manageable congestion. 

Despite Demand for Additional Slots at Slot-Controlled Airports, Some 
Slots Go Unused While Others Are Underutilized: 

Existing slot control rules require airlines to operate their slots at 
least 80 percent of the time, which allows airlines to not schedule 
some of their allocated slots. FAA has interpreted the rules to allow 
airlines to apply the usage requirement across a pool of slots they 
hold within a slot period--an allowance that provides an advantage to 
airlines with large slot holdings in meeting the usage requirement. 
Further, FAA's current process for overseeing airlines' compliance of 
the 80 percent slot usage requirement, including its recordkeeping, 
does not provide sufficient assurance that it can adequately identify 
instances when airlines do not meet the 80 percent slot usage 
requirement. We also found that airlines tend to underutilize the 
slots they do operate at slot-controlled airports as compared with 
like-sized airports that are not slot-controlled.[Footnote 48] 
Specifically, flights operated at slot-controlled airports tend to use 
smaller aircraft and are on average less full, which means that fewer 
passengers are served then would be otherwise. 

Unused Capacity: 

Available airport capacity at slot controlled airports can go unused 
in three distinct ways. The first of these are slots that are 
unallocated (i.e., slots that are not currently held by any airline). 
These slots, however, are generally at times of day that airlines find 
undesirable, such as early morning or late evening slots. Although 
unallocated slots go unused, they are available for any airline to 
request and operate.[Footnote 49] Second, some additional amount of 
available capacity goes unused because airlines do not schedule all of 
the slots that they are allocated. Third, more capacity goes unused 
because airlines do not operate all of the flights that they schedule, 
although this is in part because of cancellations resulting from 
unforeseeable circumstances.[Footnote 50] As discussed below, we could 
not calculate precisely how much capacity is unused among these three 
levels or even overall because current airline reporting and FAA 
recordkeeping do not allow these calculations. Figure 3 illustrates 
the three areas in which capacity can go unused at slot-controlled 
airports. The amount that goes unused varies depending on the airport, 
airline, time of year, and demand for air travel. 

Figure 4: Areas of Unused Capacity at Slot-Controlled Airports: 

[Refer to PDF for image: illustration] 

Operated slots: 
Usage rate: Airlines are required to use their slots at least 80% of 
the time. 

Areas of unused capacity: 
Unallocated slots (at times that are undesirable to airlines); 
Unscheduled slots; 
Cancellations. 

Source: GAO. 

[End of figure] 

Unscheduled Slots: 

Although slot control rules require airlines to operate their slots at 
least 80 percent of the time, or the slots are subject to withdrawal 
by FAA, the rules do not require a minimum level for which the 
airlines must schedule their slots. Therefore, the usage requirement 
allows airlines to not schedule or to suspend flights for operational 
reasons (such as cancellations because of bad weather or ground 
delays) up to 20 percent of the time.[Footnote 51] According to FAA 
officials, it is not the agency's intention for airlines to operate at 
the minimum usage rate of 80 percent because unforeseen circumstances 
would result in the airline losing their slots. Generally, airlines 
consider slots that they hold to be valuable assets, in part, because 
slots are a scarce resource that allows airlines to operate flights at 
airports with a high demand for air travel.[Footnote 52] However, 
airlines may not need all of their allocated slots at a point in time. 
Even so, airlines still have an incentive to hold onto their slots, 
even if that means leasing them, because if they return them to FAA 
the slots could be reallocated to a competitor. During our review, we 
found that airlines at U.S. slot-controlled airports are not 
scheduling all of their allocated slots. Specifically, our analysis of 
aggregated airline schedules for certain days in 2011, indicated that 
generally airlines in aggregate scheduled between 80 percent and 100 
percent of their slot allocations (depending on the airport, day of 
week, and season), but on specific days, one or more airlines 
scheduled as little as 75 percent of all daily allocated slots. 
[Footnote 53] Because slot usage is measured across multiple days of a 
reporting period--all days within a 2-month period at Reagan National 
and LaGuardia and each day of the week within a season for JFK and 
Newark--airlines can schedule less than 80 percent of their allocated 
slots on a single day and still meet the 80 percent usage requirement. 

Internationally, where slot controls are more prevalent than in the 
United States, airlines generally schedule all of their slots. IATA 
representatives told us that airlines operating at slot-controlled 
airports outside of the United States generally schedule 100 percent 
of their allocated slots and that it may be seen as abuse if they 
don't schedule all of their slots. Under the Worldwide Slot 
Guidelines, airlines may only hold slots that they intend to operate, 
transfer, exchange or use in a shared operation, and violations are 
subject to sanction under local regulation or national law. FAA, 
however, in implementing U.S. slot control rules, generally does not 
calculate or know airlines' schedule rates. Requiring airlines to 
schedule all of their slots could encourage airlines to sell or lease 
slots to airlines that desire them or return slots to FAA that they do 
not intend to use, but it could also cause airlines to operate more 
flights than necessary to meet demand for routes within their business 
model as a means of meeting the 80 percent usage requirement. Airlines 
would only operate additional flights, though, if the perceived cost 
of relinquishing their slot--such as the risk of a competitor 
operating the slot--is higher than the cost they would incur from 
operating the flight. 

Slot Usage Rate Compliance: 

FAA's current process for overseeing airlines' compliance of the 80 
percent slot usage requirement, including its recordkeeping, does not 
provide sufficient assurance that it can adequately identify instances 
when airlines do not meet the 80 percent slot usage requirement. FAA 
uses a slot management system to compile usage data reported by 
airlines and validate that data against FAA's slot allocation records. 
FAA then reviews instances of potential noncompliance on an exception 
basis--that is, FAA reviews only those instances that its system 
identifies as below the 80 percent slot usage rate. Our review of 
FAA's process for overseeing airlines' slot usage, combined with FAA's 
inability to provide documentation verifying airlines' compliance with 
the usage requirement and our limited analysis of FAA aggregated data 
on airlines' flight schedules and slot allocation records, raised 
questions regarding FAA's ability to effectively identify instances of 
noncompliance. Issues we identified include the following. 

* Usage rates are generally not calculated: At the end of each 
reporting period, airlines submit reports to FAA that include the 
minimum required data for each slot, including whether the slot was 
operated, the flight number, and the scheduled time of departure, but 
do not include actual usage rates. FAA officials said that they do not 
calculate the actual slot usage rate for each airline's slot holdings, 
in part, because the format in which airlines report the data makes it 
difficult to correlate the slots to the flights that were operated. 
For example, flights operated by Airline A using slots leased or 
exchanged from Airline B may be reported by Airline A, but would need 
to be considered in Airline B's usage rate but not in Airline A's 
rate. The airline reports generally do not make this distinction. 
Furthermore, FAA does not require airlines to report the same flight 
in a specific slot throughout the reporting period, which further 
complicates FAA's ability to correlate a slot to the flight that was 
operated. Without calculating airlines' actual usage rate, FAA does 
not know precisely how much available capacity goes unused, which 
hinders its ability to manage slots and the airspace. 

* Reliance on self-reported data in a variety of formats: Instead of 
calculating the actual usage rate, FAA compares airlines' reported 
data with FAA slot allocation records and in so doing will correct 
discrepancies or errors. However, FAA does not fully verify the 
accuracy of airlines' self-reported data. Furthermore, FAA does not 
require a specific format for airlines' usage reports. Therefore, some 
reports are received in a database format that can be entered into 
FAA's slot management system through an automated interface. Others 
require FAA to manually enter data from a spreadsheet into its system. 
In some cases, FAA officials told us that if extensive reporting 
errors or formatting or other administrative changes are needed, they 
may require the airline to submit a supplemental or corrected usage 
report. 

* Limitations in FAA's database: Because of the difficulties in 
calculating usage rates by FAA, we conducted a limited analysis of 
airline schedule data and FAA data to assess the extent to which 
airlines were using their slots. Using slot allocation records for 
scheduled passenger flights provided by FAA for select days and 
matching them against airline flight schedules for those days, we 
examined the extent to which airlines were scheduling their slots. 
Based on our initial analysis, we determined that in one instance at 
least one airline had not met the 80 percent usage requirement at 
Newark.[Footnote 54] Although our method of analysis is not the method 
that FAA uses to oversee individual airlines' compliance with the 
usage requirement, FAA officials agreed that our method could be used 
to assess whether some of the slots were, at times, operated less than 
80 percent of the time. Our method would not gauge individual 
airline's compliance, but would provide an aggregated check of usage 
by all airlines. FAA officials told us that they were not aware of the 
problem at Newark so they rechecked their slot allocation records and 
realized that the total slot allocation numbers in their data for 
Newark and JFK were inaccurate. Specifically, their records did not 
account for slots that airlines "handback" (i.e., return) to FAA prior 
to the slot's handback deadline. Airlines at Newark and JFK are 
allowed to and routinely do return to FAA blocks of slots (e.g., 
specific days of the week or short periods of time) that they 
initially requested and were allocated by FAA but do not intend to 
operate during the season.[Footnote 55] FAA officials said that they 
do not always update their slot allocation database with the lists of 
returned slots because it would be too resource-intensive and because 
of limitations in the computer software. While removing the handbacks 
from the allocation numbers provided to us increased the airlines' 
presumed usage rate above 80 percent at Newark airport, FAA did not 
calculate the usage rates with the corrected data and thus, could not 
provide us verification that the airlines usage exceeded 80 percent. 
And, it does not remove our concerns regarding the accuracy of FAA's 
data or process for verifying compliance with the 80 percent rule. 

* Slot trades and leases: FAA's review is further complicated by the 
number and frequency of slot trades and leases between airlines. FAA 
officials estimate that it records more than 5,000 airline trades or 
leases per season, which are manually entered into its records. 
Furthermore, slot usage is often reported by the slot operator, but 
the slot holder is responsible for complying with the slot usage 
requirement. Therefore, FAA often has to analyze and correct 
differences in data submitted by a slot holder and the slot operator 
(i.e., the lessee). 

FAA officials acknowledged some inaccuracies in their data and that 
their process is somewhat inefficient, but told us that they have 
identified instances when airlines have not met the 80 percent usage 
rate and required airlines to return the underutilized slots to FAA. 
In these cases, FAA has issued letters to airlines indicating that 
they had lost rights to their slot. Furthermore, FAA officials 
explained that they are replacing the existing software system, which 
they said will address some of the problems we identified in 
maintaining complete and accurate records and make their oversight of 
airlines' compliance with the usage requirement more efficient. In 
particular, the new system should reduce the amount of data that 
requires manual entry into their records system. FAA anticipates 
implementing the new system by the end of 2012. However, because the 
system is not yet operational and its design is not finalized, we do 
not know to what extent the new system will improve the accuracy of 
FAA's records or improve its ability to check airlines' compliance 
with the usage requirement. 

FAA's administration of the slot rules provides airlines with large 
slot holdings an advantage over those airlines that hold few slots 
because they have more flexibility in meeting the 80 percent usage 
requirement. Specifically, FAA does not require that airlines report 
the same flight in a specific slot over the course of a reporting 
period, which essentially allows airlines that hold multiple slots 
within a slot period--30 minutes at the New York City airports and 1 
hour at Reagan National--to apply the 80 percent usage requirement 
collectively to their pool of slots within that slot period, as 
opposed to each individual slot. For example, an airline that holds 5 
slots within one slot period could hold but not operate one of its 5 
slots (20 percent) and still meet the usage requirement if the other 4 
were used at 100 percent by "rotating" 4 flights across its 5 
allocated slots during the reporting period. FAA officials told us 
that they recognize that this method of applying the usage requirement 
provides more flexibility to airlines with multiple slots in a slot 
period, and that although this method is not specifically addressed in 
the slot control rules, it is not prohibited either. FAA officials 
told us that this method is a long-standing custom that has evolved 
within FAA over time. FAA has no written guidance for airlines 
describing the method. Most slot coordinators outside of the United 
States oversee compliance with the usage requirement based on each 
slot's individual usage. Port Authority officials said that measuring 
usage for each individual slot would reduce the incidence of airlines 
holding onto slots that they do not need, making some existing 
capacity available for redistribution. Representatives from four 
smaller slot-holding airlines told us they would favor FAA requiring 
airlines to apply the usage requirement to each individual slot, while 
representatives from five airlines--four of which have larger slot 
holdings--said they were opposed to it because it would reduce their 
scheduling flexibility. Using the current method for measuring usage 
of an airline's slot pool within a slot period, airlines have an 
additional incentive to obtain as many slots as possible to increase 
their operating flexibility without necessarily increasing their 
number of operations--which would be an inefficient use of limited 
airport capacity. Port Authority officials told us that airlines in 
the past have announced new air service without obtaining any new 
slots. However, the only way for an airline to add more flights 
without obtaining more slots is if that airline begins using a slot 
that it was not fully utilizing before. In addition, DOJ raised this 
as a concern in its comments on the US Airways and Delta Air Lines 
proposed slot swap, referring to the practice of airlines using 
flights on slots that exceed the 80 percent threshold to cover for an 
unused slot in the same slot period as "babysitting".[Footnote 56] 

Increasing the minimum usage requirement above 80 percent could also 
result in less capacity going unused. For example, according to 
Airports Council International in Europe, an airport organization that 
supports the European Commission proposal to increase the minimum 
usage requirement in Europe to 85 percent, increasing the slot usage 
requirement would encourage airlines to optimize their use of slots 
and allow slots that are not being used effectively to be returned and 
reallocated. Because airlines operating outside the United States 
generally schedule all of their slots, they tend to operate a higher 
percentage of their slots than in the United States. Even so, 
representatives from the Association of European Airlines told us that 
increasing the required usage rate could result in an unintended 
consequence of having airlines fly more aircraft than consumer demand 
requires on specific routes, and with lower load factors (percent of 
available seats filled with passengers), to meet the higher usage 
requirement. Although most U.S. airline representatives with whom we 
spoke said they opposed increasing the slot usage requirement, 
representatives from two airlines with small slot holdings said they 
would support increasing it and a representative from another airline 
supported increasing it if the new rate did not penalize for 
cancellations because of bad weather and other unforeseeable 
circumstances. Representatives at an airline with a large number of 
slots said that increasing the slot usage requirement above 80 percent 
would not increase efficiency because it would reduce airlines' 
flexibility to cope with unforeseeable events such as weather, air 
traffic control delays, or technical problems. On average, however, 
flight cancellations account for less than 2 percent of the total 
scheduled flights (the cancellation rates at the New York City area 
airports are generally higher than the system-wide average) and FAA 
may grant waivers to the minimum usage requirement under other unusual 
or unpredictable circumstances.[Footnote 57] 

Underutilized Capacity: 

Despite limits on airport capacity, flights operated at slot-
controlled airports--as compared with flights at other like-sized 
airports that are not slot-controlled--: 

* tend to use smaller aircraft; 

* are, in some instances, flown to the same destination at higher 
rates per day; and: 

* have lower overall load factors (percentage of available seats 
filled with passengers). 

As a result, the level of passenger traffic at these airports is not 
as great as the number of slots could allow and would-be-new entrant 
airlines that could potentially offer lower fares or service to other 
destinations may be shut out of these markets. The potential 
inefficient use of slots by incumbent airlines at the New York City 
area airports as a way to block competitors' entry to the New York 
market has been examined before. Under FAA's 2006 proposed, but later 
withdrawn, congestion-management rule for LaGuardia, FAA proposed 
requiring airlines to use an average minimum aircraft size. FAA--in 
explaining its proposal--indicated that some inefficiencies at 
LaGuardia were related to airlines using smaller aircraft and that 
increasing the overall number of passengers without increasing the 
number of flights would result in a more efficient use of the national 
airspace system. Although FAA ultimately withdrew the proposed average 
minimum aircraft size requirement in 2008, the agency indicated that 
the concept behind the proposed minimum aircraft-size requirement 
remained valid because capacity cannot be considered merely on the 
basis of the number of aircraft being handled by FAA's Air Traffic 
Control system.[Footnote 58] In particular, FAA cited certain market 
patterns involving multiple daily flights on small aircraft that were 
not related to the size of the community served, which indicated an 
inefficient use of slots or behavior that stifled competition. 
Similarly, in 2010, when DOJ commented on the competitive aspects of 
the proposed slot swap between Delta Air Lines and US Airways at slot-
controlled Reagan National and LaGuardia, it found that airlines 
engaged in what DOJ referred to as "slot hoarding" by flying excessive 
frequencies or using small planes.[Footnote 59] While the use of 
smaller aircraft, high frequencies, and low load factors may be 
indications that airlines are hoarding slots as a way to keep 
competitors out of the slot-controlled airports, there are also 
possible market-based explanations for these tendencies. Without other 
evidence of airlines' motivations, all that can be determined is that 
flights at the slot controlled airports tend to use the available 
capacity more inefficiently than like-sized airports that are not slot-
controlled. But, given that slots are a scarce resource and interest 
from new entrant airlines is known, this provides sufficient reason to 
improve slot utilization. 

Aircraft Size: 

To examine the extent to which flights at slot-controlled airports use 
smaller aircraft (100 seats or fewer[Footnote 60]), we conducted 
statistical analyses using data on aircraft size of scheduled 
passenger flights between domestic, large hub airports.[Footnote 61] 
We analyzed airline schedule data that included, among other things, 
the scheduled flight date, origin and destination of the scheduled 
flight, and the size of the aircraft. We used data from one Thursday 
each in February 2011 and in August 2011.[Footnote 62] Thursdays are 
generally considered to be a high-demand day, and February and August 
are representative months for the winter and summer seasons, 
respectively. 

Our analysis indicates that the proportion of flights using small 
aircraft is significantly greater at the slot-controlled airports than 
at other large hub airports that are not slot-controlled. The 
proportion of flights using small aircraft at slot-controlled airports 
ranged from 36 percent at LaGuardia to 25.8 percent at Newark, whereas 
the proportion of flights using small aircraft to and from large hub 
airports that are not slot-controlled was 16.4 percent. That is, the 
percent of flights using small aircraft at any of the slot-controlled 
airports was between 9.4 percent and 19.6 percent higher--depending on 
the airport--than the percent of flights using small aircraft at other 
non-slot-controlled large hub airports. We found that these 
differences were all statistically significant (see table 5). To some 
extent, the perimeter rules at Reagan National and LaGuardia 
contribute to the use of smaller aircraft at these airports because 
shorter haul flights are generally served by smaller aircraft, but 
also limit service to larger long-distance markets that use larger 
aircraft. Also, 11 out of the 60 hourly slots allowed under the High 
Density Rule slots at Reagan National are reserved for and require the 
use of smaller aircraft used for commuter flights. And, under 
LaGuardia's temporary order, FAA assigned some slots to airlines that 
held slot exemptions granted under AIR-21, which included slot 
exemptions for flights serving small communities using aircraft with 
fewer than 71 seats. See appendix V for a detailed discussion of our 
analysis and the results. 

Table 5: Percentage Difference in Flights at Slot-Controlled Airports 
That Use Small Aircraft Compared with Flights at Non-Slot-Controlled 
Airports, 2011: 

Airport(s): Newark; 
Percentage of flights that use small aircraft: 25.8 percent; 
Percentage differences in small aircraft at slot-controlled airports 
compared with other large hub airports that are not slot-
controlled[A]: 9.4 percent more. 

Airport(s): JFK; 
Percentage of flights that use small aircraft: 26.6 percent; 
Percentage differences in small aircraft at slot-controlled airports 
compared with other large hub airports that are not slot-
controlled[A]: 10.2 percent more. 

Airport(s): Reagan National; 
Percentage of flights that use small aircraft: 34.0 percent; 
Percentage differences in small aircraft at slot-controlled airports 
compared with other large hub airports that are not slot-
controlled[A]: 17.6 percent more. 

Airport(s): LaGuardia; 
Percentage of flights that use small aircraft: 36.0 percent; 
Percentage differences in small aircraft at slot-controlled airports 
compared with other large hub airports that are not slot-
controlled[A]: 19.6 percent more. 

Airport(s): All 4 U.S. slot-controlled airports; 
Percentage of flights that use small aircraft: 29.3 percent; 
Percentage differences in small aircraft at slot-controlled airports 
compared with other large hub airports that are not slot-
controlled[A]: 12.9 percent more. 

Airport(s): All 3 New York City area slot-controlled airports; 
Percentage of flights that use small aircraft: 30.2 percent; 
Percentage differences in small aircraft at slot-controlled airports 
compared with other large hub airports that are not slot-
controlled[A]: 13.8 percent more. 

Airport(s): Large hub airports that are not slot controlled; 
Percentage of flights that use small aircraft: 16.4 percent; 
Percentage differences in small aircraft at slot-controlled airports 
compared with other large hub airports that are not slot-
controlled[A]: N/A. 

Source: GAO analysis of airline schedule data. 

N/A = not applicable. 

[A] The percentage differences are all statistically significant. 

[End of table] 

To better understand the extent to which small aircraft are used at 
slot-controlled airports, we also developed a logistic regression 
model that controlled for other factors that are likely associated 
with aircraft size.[Footnote 63] The model assessed whether scheduled 
passenger flights to or from slot-controlled airports tend to have a 
greater likelihood of being scheduled with small aircraft compared 
with flights to and from other large hub airports that are not slot-
controlled. In addition, the model controlled for other factors that 
include (1) whether the origin or destination of the flight is a high-
tourism airport,[Footnote 64] (2) whether the airline marketing the 
flight is a "legacy" airline,[Footnote 65] (3) the daily frequency of 
flights to the same destination by the same airline, and (4) the 
flight distance. Although the model controls for distance, which helps 
control the effect of the perimeter rules at Reagan National and 
LaGuardia, the model does not control for the designated commuter 
slots at Reagan National that are limited to commuter-sized 
aircraft.[Footnote 66] However, FAA officials told us that based on 
their analysis, about 30 to 40 percent of slots that do not require 
the use of commuter aircraft also use commuter-sized aircraft. Also, 
as with any regression model, this analysis does not prove a causal 
relationship between different factors, such as slot control rules and 
an airlines' use of a small aircraft. Thus, the extent to which the 
slot-control rules, the perimeter rules at Reagan National and 
LaGuardia, and the commuter-slot designation at Reagan National 
contribute to underutilization at these airports is unknown. Other 
factors related to the use of small aircraft may not be fully 
controlled for, such as the type of passenger traffic. See appendix V 
for a detailed discussion of the model. 

Similar to our analysis discussed above, the model results also 
suggest that airlines are more likely to use small aircraft for 
flights at slot-controlled airports than they are for flights at other 
large hub airports that are not slot-controlled. Specifically, when 
controlling for other factors that may be associated with using a 
small aircraft, flights to or from the four slot-controlled airports 
are between 22 percent and 108 percent more likely--depending on the 
airport--to use a small aircraft than flights that arrive and depart 
large hub airports that are not slot-controlled (see table 6). See 
appendix V for a detailed discussion of the model results. 

Table 6: Percentage Difference in Likelihood of a Flight's Using Small 
Aircraft at Slot-Controlled Airports Compared with Non-Slot-Controlled 
Airports: 

Slot-controlled airport(s): Newark; 
Likelihood (as measured by odds ratio)[A] that a flight to or from a 
slot-controlled airport used a small aircraft compared with other 
large hub airports that are not slot-controlled: 22 percent more 
likely[B]. 

Slot-controlled airport(s): JFK; 
Likelihood (as measured by odds ratio)[A] that a flight to or from a 
slot-controlled airport used a small aircraft compared with other 
large hub airports that are not slot-controlled: 63 percent more 
likely[C]. 

Slot-controlled airport(s): Reagan National; 
Likelihood (as measured by odds ratio)[A] that a flight to or from a 
slot-controlled airport used a small aircraft compared with other 
large hub airports that are not slot-controlled: 72 percent more 
likely[C]. 

Slot-controlled airport(s): LaGuardia; 
Likelihood (as measured by odds ratio)[A] that a flight to or from a 
slot-controlled airport used a small aircraft compared with other 
large hub airports that are not slot-controlled: 108 percent more 
likely[C]. 

Slot-controlled airport(s): All 4 U.S. slot-controlled airports; 
Likelihood (as measured by odds ratio)[A] that a flight to or from a 
slot-controlled airport used a small aircraft compared with other 
large hub airports that are not slot-controlled: 75 percent more 
likely[C]. 

Slot-controlled airport(s): All 3 New York City area slot-controlled 
airports; 
Likelihood (as measured by odds ratio)[A] that a flight to or from a 
slot-controlled airport used a small aircraft compared with other 
large hub airports that are not slot-controlled: 68 percent more 
likely[C]. 

Source: GAO analysis of airline schedule data. 

Notes: The results of our analyses for 124 seat and 80 seat cutoffs 
also found odds ratio values greater than 1, and in some instances the 
results were more significant. 

The percentage differences in the likelihood that a flight used a 
small aircraft presented here are based on odds ratios calculated from 
our model. Specifically, the likelihood equals the odds ratio minus 1, 
then multiplied by 100. 

[A] See appendix V for a description of odds ratios. 

[B] Statistically significant at p-value less than 0.1. 

[C] Statistically significant at p-value less than 1.01. 

[End of table] 

According to representatives from some airlines with smaller slot 
holdings and some airport representatives, airlines with large slot 
portfolios have an incentive and the ability to fly smaller and more 
frequent flights at slot-controlled airports in a desire to hold on to 
slots they would otherwise not use because they do not want to lose 
them to a competitor. Of the 11 airlines that we interviewed for this 
review, representatives from 7 non-legacy airlines favored 
establishing minimum aircraft size requirements at the slot-controlled 
airports, while representatives from 3 legacy airlines opposed 
it.[Footnote 67] Representatives from two airlines also said they 
would support a minimum aircraft size requirement if small aircraft 
could still be used to serve small communities. Representatives from 
two airlines who favored establishing a minimum aircraft size said 
that using small aircraft between major markets is a particularly 
inappropriate use of constrained airspace. However, representatives 
from legacy airlines that we spoke with said establishing minimum 
aircraft size requirements would negatively affect service to small-
and medium-sized markets and that it would limit their ability to use 
aircraft sizes that are most appropriate to meet customer needs, for 
example, regarding schedule frequency and market conditions. 

Flight Frequency: 

In analyzing airline schedule data, we found instances when airlines 
scheduled flights to or from slot-controlled airports for the same 
destination at a more frequent rate than other large hub airports that 
are not slot-controlled. For example, airlines might fly smaller 
aircraft at higher rates to provide frequent shuttle service for 
business travelers. We found, however, that on February 11, 2011, one 
airline scheduled more than 20 daily flights from LaGuardia to 
Philadelphia--a distance of 96 miles by air--and that some of those 
flights were scheduled 10 minutes or less apart. As of June 21, 2012, 
the airline had reduced the number of daily nonstop flights on this 
route to 15. Representatives from the airline operating these flights 
said the high frequency of flights between LaGuardia to Philadelphia 
is driven by consumer demand and provides more choice for customers. 
They also said that almost all of the passengers on these flights are 
connecting to other flights and that the airline is not competing with 
other airlines in this market, but with cars and trains. To better 
understand the extent to which airlines schedule flights to or from 
slot-controlled airports for the same destination at short intervals, 
we examined the frequency of scheduled flights to the same destination 
by the same airline between all large hub airports for one day in 
February 2011.[Footnote 68] February is a low demand month in which 
airlines at slot-controlled airports might not reduce the number of 
scheduled flights as they might at other airports that are not slot-
controlled. Rather, the airline might operate smaller, more frequent 
flights to meet the 80 percent usage requirement.[Footnote 69] Our 
analysis found that of the scheduled flights to or from the same 
destination by the same airline within 15 minutes of one another, 
LaGuardia accounted for 17 of the 50 total scheduled flights 
identified (34 percent). The airport with the next highest proportion 
was Philadelphia International with 11 of the 50 identified flights 
(22 percent) - all of which were scheduled to fly to or from 
LaGuardia. Moreover, the 11 scheduled flights that we identified 
within 15 minutes of one another operated by the same airline between 
LaGuardia and Philadelphia had an average aircraft size of 38 seats. 
When we examined scheduled flights within 30 minutes of one another to 
or from the same destination by the same airline, LaGuardia still had 
the highest share with 70 of the 264 identified flights (27 percent), 
followed by Philadelphia International with a share of 29 of the 264 
identified flights (see figure 4). While current slot control rules do 
not prohibit airlines from this type of scheduling practice, FAA 
officials noted that the slot swap between Delta Air Lines and US 
Airways have enabled these airlines to use their resources more 
efficiently. Port Authority officials told us that they believe that 
any airline that schedules a second flight to the same destination 
within a slot period (30 minutes at the New York City area airports) 
should have to demonstrate that there is demand for that second flight 
that could not be met by a single larger aircraft. 

Figure 4: Airports' Share of Scheduled Flights to or from the Same 
Destination by the Same Airline within 15 Minutes or 30 Minutes of One 
Another, February 2011: 

[Refer to PDF for image: 2 pie-charts] 

Airport share of scheduled flights to or from same	destination by same 
airline within 15 minutes of one another: 
LaGuardia: 34%; 
Philadelphia	International: 22%; 
Phoenix Sky Harbor International: 12%; 
Other	airports	(6 airports, each less than 10%): 32%. 

Airport share of scheduled flights to or from same	destination by same 
airline within 30 minutes of one another: 
LaGuardia: 27%; 
Philadelphia	International: 11%; 
Chicago O'Hare: 10%; 
Other airports (18 airports, each less than 10%): 52%. 

Source: GAO analysis of airline schedule data. 

Notes: "Other" airports in the 15 minute chart include Charlotte/ 
Douglas International, Chicago O'Hare International, Dallas-Fort Worth 
International, Las Vegas McCarran International, Newark, and San Diego 
International. 

"Other" airports in the 30 minute chart include Hartsfield-Jackson 
Atlanta International, Boston Logan International, BWI, Charlotte/ 
Douglas International, Dallas-Fort Worth International, Denver 
International, Detroit Metro Wayne County, Dulles, Las Vegas McCarran 
International, Los Angeles International, Orlando International, Miami 
International, Newark, Phoenix Sky Harbor International, Reagan 
National, San Diego International, San Francisco International, and 
Tampa International. 

[End of figure] 

Load Factors: 

We also examined FAA data on average load factors (percentage of seats 
occupied) at large hub airports for all domestic scheduled passenger 
flights in calendar year 2011 and found that flights at slot-
controlled airports were overall less full than flights at other large 
hub airports that are not slot-controlled. As shown in figure 5, we 
found that Reagan National (70 percent) and LaGuardia (72 percent) had 
the lowest average load factors for 2011 among the large hub airports, 
with Newark (77 percent) tied with Boston Logan International and 
Philadelphia International for the third lowest load factor. 

Figure 5: Average Load Factors at Large Hub Airports for Scheduled 
Flights during 2011: 

[Refer to PDF for image: horizontal bar graph] 

Airport: Orlando International; 
Annual average load factor: 84%. 

Airport: Seattle-Tacoma International; 
Annual average load factor: 84%. 

Airport: Denver International 
Annual average load factor: 83%. 

Airport: Las Vegas McCarren International; 
Annual average load factor: 82%. 

Airport: San Francisco International; 
Annual average load factor: 82%. 

Airport: San Diego International; 
Annual average load factor: 82%. 

Airport: Fort Launderdale-Hollywood International; 
Annual average load factor: 82%. 

Airport: Los Angeles International; 
Annual average load factor: 82%. 

Airport: Atlanta Hartsfield International; 
Annual average load factor: 82%. 

Airport: Salt Lake City International; 
Annual average load factor: 81%. 

Airport: JFK; 
Annual average load factor: 81%. 

Airport: Miami International; 
Annual average load factor: 81%. 

Airport: Chicago Midway; 
Annual average load factor: 81%. 

Airport: Charlotte/Douglas International; 
Annual average load factor: 81%. 

Airport: Chicago O'Hare International; 
Annual average load factor: 80%. 

Airport: Phoenix Sky Harbor International; 
Annual average load factor: 80%. 

Airport: Tampa International; 
Annual average load factor: 80%. 

Airport: Dallas-Fort Worth International; 
Annual average load factor: 80%. 

Airport: Minneapolis-St. Paul International; 
Annual average load factor: 8%. 

Airport: Detroit Metro Wayne County; 
Annual average load factor: 80%. 

Airport: George Bush Intercontinental; 
Annual average load factor: 79%. 

Airport: Dulles; 
Annual average load factor: 78%. 

Airport: BWI; 
Annual average load factor: 78%. 

Airport: Boston Logan International; 
Annual average load factor: 77%. 

Airport: Philadelphia International; 
Annual average load factor: 77%. 

Airport: Newark; 
Annual average load factor: 77%. 

Airport: LaGuardia; 
Annual average load factor: 72%. 

Airport: Reagan National; 
Annual average load factor: 70%. 

Source: GAO analysis of DOT data. 

[End of figure] 

According to Port Authority officials and some airline 
representatives, some airlines at slot-controlled airports might 
operate flights with lower load factors to help meet the 80 percent 
usage requirement and maintain control of their slots, whereas flights 
with similarly low load factors at a non-slot-controlled airport might 
be discontinued. However, another factor to explain the comparatively 
low load factors at New York airports is the relatively high airline 
yields (a measurement of airline revenue per mile). Yields at Newark, 
LaGuardia, and Reagan National are some of the highest among the large 
hub airports, which means that a flight with a low load factor may 
still be profitable for these airlines. If the objective is to 
maximize the number of passengers at these airports, however, this 
represents an inefficient use of airport capacity. 

Slot Control Rules Limit New Entry and Hinder Competition: 

Representatives from low cost and other airlines that have sought to 
obtain slots told us that they have had difficulty gaining access to 
slot-controlled airports. Airline representatives seeking slots at 
these airports told us that they have spoken to FAA, but generally not 
enough slots are available or the slots are at undesirable times of 
day (e.g., early morning or late evening) for these airlines to 
operate profitable service.[Footnote 70] DOT officials are also aware 
of the access issue, and it was a focus of the previous congestion-
management rulemakings and an advisory Aviation Rulemaking Committee 
report for the New York City area airports.[Footnote 71] DOT also took 
steps to mitigate potential competitive harm from the Delta Air Lines 
and US Airways proposed slot swap by requiring divestiture of some 
slots at the airports to airlines with small or no presence at the 
airports. DOJ, in commenting on competition at LaGuardia and Reagan 
National during the Delta Air Lines and US Airways proposed slot swap 
in 2010, indicated that the lack of availability of slots is a 
substantial barrier to entry at those airports, especially for low 
cost airlines. Based on literature that we reviewed, airfares can drop 
up to 30 percent on a flight route as a result of a low cost airline 
entering the airport and beginning service on that route.[Footnote 72] 
Because average airfares at the slot-controlled airports are some of 
the highest among domestic large hub airports, the entrance of low 
cost competition could be helpful in bringing down airfares at those 
airports. While in some cases Congress has directed that new airport 
capacity in the form of slot exemptions be allocated to new entrants 
or "limited incumbents," which are generally low cost airlines, those 
new slot exemptions are a small percentage of the total slots at the 
airport. Figure 6 shows that the proportion of passenger traffic 
handled by the nonlegacy airlines in 2011 generally is smaller at slot-
controlled airports compared with the other 24 large hub airports. 

Figure 6: Proportion of Legacy and Other Airline Passenger Traffic at 
Slot-Controlled and Non-Slot-Controlled Large Hub Airports, 2011: 

[Refer to PDF for image: 5 pie-charts] 

Newark: 
Legacy airlines: 86%; 
All other airlines: 14%. 

Reagan National: 
Legacy airlines: 82%; 
All other airlines: 18%. 

LaGuardia: 
Legacy airlines: 79%; 
All other airlines: 21%. 

JFK: 
Legacy airlines: 49%; 
All other airlines: 51%. 

Non-slot-controlled large hub airports average: 
Legacy airlines: 61%; 
All other airlines: 39%. 

Source: GAO analysis of DOT data. 

[End of figure] 

DOJ also indicated in 2010 that increasing the number of slots held by 
two large legacy carriers at the slot-controlled LaGuardia and Reagan 
National airports would make it more difficult for new entrants to 
obtain slots because large legacy carriers would have greater 
incentives to forestall entry by refusing to sell or lease their 
slots. Representatives of some airlines with few slot-holdings told us 
that they believe that the airlines that hold the majority of slots at 
the airports are hesitant or unwilling to lease to them. In general, 
airlines holding a slot under FAA's slot rules may lease or trade 
slots to other airlines and can select which airlines they lease or 
trade slots with.[Footnote 73] Airlines may have legitimate business 
reasons for leasing slots to code-share partners, for example, to feed 
into the lessor airlines' network. In addition, representatives from 
large slot-holding airlines said that they may hold onto slots that 
they do not currently need by leasing to other airlines in case they 
want them back later. In general, airlines only return slots to FAA 
that airlines are unable to find other airlines interested in leasing 
or buying. Airlines with large slot holdings also noted that they have 
made substantial financial investments in terminal facilities, such as 
terminals at JFK, at the slot-controlled airports. While the slots 
that are returned can be reallocated to other airlines, including new 
entrants or limited incumbents, the returned slots generally are the 
least desirable--such as early morning or late evening or weekend-
only--and may only be for a couple of months, which makes them 
undesirable for airlines trying to build year-round service. 

According to Port Authority officials and some airline 
representatives, if FAA were to limit the length of time that an 
airline could hold on to a slot when that airline was not using or 
leasing it to another airline--after which the slots would be 
withdrawn by FAA for reallocation--this could provide opportunities 
for new entrants or small slot-holders to obtain slots. 
Representatives from most of the airlines we contacted, except the 
legacy airlines, said they favored limiting how long airlines can hold 
onto slots they are not using. However, representatives from a legacy 
airline said that imposing such a holding limit is unnecessary because 
slots do not go unused. These representatives told us that although 
there are some instances that on paper it appears that airlines are 
not using their slots, the airlines are actually holding the slots by 
leasing them to other airlines for a future time when they want to use 
them again. Also, the representatives noted that airlines may be 
holding onto slots for long periods of time (e.g., over multiple 
seasons) because the temporary slot orders for the New York City area 
airports do not allow airlines to buy or sell slots. 

FAA's administration of its slot rules can hinder the ability of 
airlines to add service at slot-controlled airports because it does 
not provide complete transparency about what slots are available. FAA 
officials said that, upon request, FAA provides airlines with lists of 
slot holders and operators as well as available slots, but some 
airline representatives and Port Authority officials told us that the 
format of this information does not make clear what slots are 
available. Furthermore, as discussed earlier, because of discrepancies 
in FAA's slot allocation records, it is unclear whether the 
information provided to airlines is accurate. Port Authority officials 
recommend public reporting of slot leasing and slot usage, including 
the reasons why the slots are not being operated (e.g., flights were 
not scheduled or were canceled) to provide transparency of 
information. In addition, although FAA requires the submission of 
certain records of all trades and leases between airlines, it does not 
require the submission of the information--such as the origin and 
destination that a lessee intends to use for the slot--that would 
allow FAA or DOT to monitor the extent to which leases occur between 
nonpartner airlines.[Footnote 74] While DOT officials questioned the 
efficacy of reviewing data currently collected on airline slot leases 
in isolation, additional information relating to the transaction could 
be helpful. But, officials noted that even with additional data, the 
department faces a very high burden of proof in alleging that an 
airline is engaged in unfair or deceptive competitive 
practices.[Footnote 75] DOT officials told us that they believe that 
under the current temporary orders, they are unable to react to 
certain market failures at slot-controlled airports, such as 
inefficient use of constrained airspace. DOT officials could not 
comment further on this because of the pending Slot Management and 
Transparency rulemaking for the New York City area airports. DOJ 
officials told us that, unless they have an open investigation, they 
do not monitor ongoing day-to-day activities such as short-term leases 
at slot-controlled airports. An investigation of competition-related 
issues at these airports is generally "triggered" by a transaction 
such as an airline merger or slot swap, although DOJ may also 
investigate in response to complaints, such as complaints by airlines 
unable to obtain slots. Additional information on leases and trades of 
slots, particularly the relationship between the lessor and the 
lessee, would allow FAA to provide more complete information to 
airlines on the availability of slots, which increases transparency. 

Conclusions: 

Because the New York City airports are both capacity constrained and 
among the nation's most sought after by airlines to serve, FAA has had 
to institute slot controls to manage congestion and resultant delays. 
It is therefore important that slots allocated to airlines are 
efficiently utilized, thereby maximizing the airports' available 
capacity, or reallocated to other airlines that will use them 
efficiently, which could, in turn, provide access to new entrant 
airlines that offer new service destinations and lower fares. Despite 
these goals, we found that considerable existing capacity is not being 
used or is used inefficiently at these airports. Certain aspects of 
the slot control rules, as well as FAA's administration of them, 
contribute to this situation and, thus, may hinder the ability of some 
new entrant airlines to obtain slots at the four U.S. slot-controlled 
airports. In particular, although the current slot control rules 
require slot holders to operate their slots 80 percent of the time, 
they do not require slot holders to schedule a flight for each of 
their slots. And, as opposed to airlines operating at slot-controlled 
airports outside the United States that generally schedule flights for 
all of their slots, domestic airlines operating at the U.S. slot-
controlled airports do not always schedule all of their slots, which 
contributes to capacity going unused. Further, FAA's current 
recordkeeping and process for reviewing airline slot usage data do not 
provide sufficient assurance that it can adequately identify when 
airlines do not meet the 80 percent usage requirement. Not requiring 
airlines to report usage data in a standard format or having 
management systems that can adequately compile data received in 
different formats, as well as its reliance on airlines' self-reported 
data and discrepancies in its slot allocation record, hinders FAA's 
ability to check compliance with the slot usage requirement. Moreover, 
because FAA does not calculate the actual slot usage rates for 
airlines, the amount of capacity that goes unused is unknown, which 
limits FAA's ability to manage slots or set policy for the airspace. 
FAA's planned upgrades to its slot management software later this year 
will hopefully improve its oversight capabilities, but not without 
better and more standardized reporting by airlines. Other practices 
that affect utilization, however, will not be fixed with the new 
software. For example, FAA allows an airline to apply the usage 
requirement across its entire pool of slots within a slot time period, 
rather than applying the requirement to its individual slot--a 
practice that provides advantages to airlines with large slot holdings 
over those with small slot holdings in meeting the requirement. This 
practice can lead to underutilization of individual slots and hinder 
other airlines' ability to obtain slots at these airports. Limitations 
in FAA's recordkeeping, particularly the discrepancies in its slot 
allocation records, as well as its lack of information on the 
relationship between slot lessors and lessees and public disclosure on 
the availability of slots and lease information, also hinder access to 
new entrant airlines at slot-controlled airports. 

Recommendations for Executive Action: 

To help maximize the use of available capacity at slot-controlled 
airports, enhance competition through greater airline access to slots, 
and enhance transparency of slot information, we recommend that the 
Secretary of Transportation direct the FAA Administrator to take the 
following five actions: 

* require airlines to report usage data in a standard format at the 
end of each reporting period or ensure that future slot management 
systems have the capability to compile data in different formats; 

* periodically calculate the rates at which airlines are scheduling 
and using their slots; 

* apply slot rules to individual slots, as opposed to pools of slots 
within a slot period; 

* periodically disclose information, which may include current slot 
holders and operators, on currently available slots; and: 

* collect and disclose data, including the relationship between 
lessors and lessees, on slot leases. 

Furthermore, with respect to possible future regulatory action, we 
recommend that DOT Secretary consider requiring airlines to schedule a 
certain percentage, or all, of their slot allocations, similar to 
practices maintained elsewhere in the world. 

Agency Comments and Our Evaluation: 

We provided DOT, MWAA, the Port Authority of New York and New Jersey, 
DOJ, and the Department of Homeland Security (DHS) with a draft of 
this report for their review and comment. DOT's Office of the 
Secretary and FAA provided technical comments that we incorporated as 
appropriate. In addition, in comments e-mailed to us, FAA reiterated 
that the slot control rules at the three New York City area airports 
and Reagan National were adopted primarily to manage congestion and 
delay at these airports by limiting planned operations during peak 
hours. Officials highlighted that complex issues arise with the 
allocation and use of a scarce resource like airport slots and that 
congestion-management policy objectives must be balanced with 
realistic competition and market access goals. FAA indicated that 
economic and compliance benefits and costs to stakeholders and 
regulatory and statutory guidelines must also be considered. We agree 
that the slot control rules can manage congestion and delay and that 
issues may arise when allocating a scarce resource. We also believe 
that the rules can be improved to make the use of current capacity 
more efficient, as well as enhance competition. Officials also noted 
that DOT's Office of the Secretary and FAA are developing rules to 
replace the temporary slot control Orders at the New York City area 
airports with more permanent rules. As stated in our report, these 
temporary rules have been extended twice, creating a level of 
uncertainty in the market about when the final rule will be issued and 
what it will contain. While we acknowledge DOT's and FAA's efforts to 
develop a permanent rule, we also believe that FAA could take separate 
action now to help maximize the use of available capacity at slot-
controlled airports, enhance competition through greater airline 
access to slots, and enhance transparency of slot information. 

MWAA provided written comments, which are reprinted in appendix VI. 
MWAA agreed with our recommendations to improve FAA's oversight of 
slot utilization and encouraged DOT to adopt these recommendations to 
better manage available airport capacity and provide a more 
transparent process. However, MWAA disagreed with our conclusion that 
the additional beyond-perimeter slot exemptions at Reagan National are 
likely to have a limited effect on the Washington, D.C., area airports 
and can be supported by terminal capacity at Reagan National. In the 
comments, MWAA indicated that the impact of the beyond-perimeter 
flights should be viewed in the broader context of other changes under 
way at Reagan National, for example, those resulting from legacy 
carrier mergers, the Delta Air Lines and US Airways slot-swap 
transaction, and other recent commercial slot transactions. MWAA 
believes that these factors are changing the operating character of 
Reagan National, change that may require considerable additional 
capital investment for extensive facility modifications. However, our 
review was expressly limited to the impact of the additional slot 
exemptions authorized in 2012, and not the cumulative effect of 
previously authorized beyond-perimeter slot exemptions and other slot-
related and commercial changes. The report includes the views of MWAA 
management with regard to the specific challenges faced by the 
expansion of beyond-perimeter slot exemptions throughout, but our 
overall assessment remains that the effect of the 2012 FAA 
Reauthorization slot exemptions is manageable and that the impact on 
other Washington, D.C., area airports is relatively small. On this 
point, MWAA disagrees with our report in regard to the financial 
impact of potential passenger erosion on Dulles International. Our 
report does recognize the potential effect on per-passenger airline 
costs at Dulles and Reagan National, but also states that this 
estimated effect is a worst case scenario and should be considered in 
light of (1) the recent substantial increases in costs from capital 
investments at Dulles that are unrelated to the new slot exemptions; 
(2) the passenger growth forecast by FAA that could ameliorate that 
erosion; (3) the views of airlines and credit-rating agencies that 
airline service is also dependent on market demand, which is strong in 
this region; and (4) the "extraordinary coverage protection payments" 
provision in the airline lease agreements that may allow MWAA to share 
debt service between the two airports should they need to and the 
possibility of revising this provision in the new lease. Finally, as 
we indicate in the report, we concur with MWAA that because some of 
the new beyond-perimeter flights only started in August 2012, the 
actual impact of the new beyond-perimeter flights cannot yet be fully 
determined. MWAA also provided some specific updated information, 
which we incorporated as appropriate in the report. 

The Port Authority of New York and New Jersey provided written 
comments, reprinted in appendix VII, agreeing with the report's 
conclusions and recommendations. The Port Authority of New York and 
New Jersey provided some clarifications that we incorporated as 
appropriate. DHS, on behalf of TSA, also provide some clarifications 
that we incorporated. DOJ provided no comments. 

We are sending copies of this report to interested congressional 
committees and the Secretary of Transportation. In addition, the 
report is available at no charge on the GAO website at [hyperlink, 
http://www.gao.gov]. 

If you or your staff have any questions about this report, please 
contact me at (202) 512-2834 or flemings@gao.gov. Contact points for 
our Offices of Congressional Relations and Public Affairs may be found 
on the last page of this report. GAO staff who made major 
contributions to this report are listed in appendix VIII. 

Signed by: 

Susan A. Fleming: 
Director, Physical Infrastructure Issues: 

Appendix I: Objectives, Scope, and Methodology: 

In this report, we reviewed (1) the potential effects of increasing 
the number of beyond-perimeter slot exemptions at Reagan National and 
(2) whether slot control rules at the four U.S. slot-controlled 
airports are working to reduce congestion, while maximizing available 
capacity and encouraging competition. 

To review the potential effects of increasing the number of beyond-
perimeter slot exemptions at Reagan National, we: 

* compared airside capacity assessments with actual usage; 

* reviewed terminal space needs; 

* assessed the impact on the additional beyond-perimeter flights on 
passenger traffic, capital financing, security screening wait times, 
and noise; and: 

* interviewed officials from the Federal Aviation Administration 
(FAA), the Metropolitan Washington Airports Authority (MWAA), and the 
Baltimore-Washington International Thurgood Marshall Airport (BWI), as 
well as representatives from airlines[Footnote 76] and others. 

Regarding airside capacity, we analyzed data on the volume of aircraft 
operations at Reagan National, regulations and FAA actions regarding 
slot allocations at the airport, and a capacity assessment conducted 
by an FAA contractor. With respect to terminal capacity, we observed 
the airport's baggage handling equipment, gates, ticket counter space, 
and security screening facilities; reviewed usage data on gates and 
parking lots; and discussed plans to expand terminal and security 
screening space with MWAA officials. 

To assess the maximum impact that the new beyond-perimeter flights 
would have on passenger traffic, we assumed that the new flights would 
be 100-percent full and that all passengers would be shifting from 
Dulles to Reagan National. This provided the highest possible estimate 
of the loss of passengers and the associated rise in cost per enplaned 
passenger at Dulles because of the new beyond-perimeter flights at 
Reagan National. However, for a variety of reasons, it is unlikely 
that the number of passengers shifting from Dulles to Reagan National 
would actually be this high. First, the new flights are unlikely to 
draw travelers solely from Dulles. For example, consumers who have a 
strong preference for flying out of Reagan National might have been 
choosing to fly from Reagan on a connecting basis but will now have a 
direct choice and, despite the likelihood of a substantially higher 
fare, some of these passengers will opt for the more expensive direct 
flight. Similarly, some travelers might shift to the new flights at 
Reagan National from BWI. Second, the availability of the new flights 
may induce some pricing impacts that could influence travelers' 
decisions. For example, airlines that fly the same routes from Dulles 
may attempt to maintain their traffic by lowering prices on those 
routes to better compete for passengers who now have a nonstop choice 
from Reagan National. This would likely mitigate the flow of 
passengers from Dulles to Reagan National, and may even induce some 
new travelers on these routes. And finally, although the new routes 
will likely be very popular, it is possible that not all seats will be 
sold indicating that not all seats are filled with passengers who 
would have previously chosen Dulles. For these various reasons, it is 
likely that our "worst case" estimate of the number of passengers 
shifting from Dulles to Reagan National is likely overstated. We did 
not include the within-perimeter flights that were converted to beyond-
perimeter slot exemptions in our analysis because there were too many 
unknown factors, such as whether the passengers those flights were 
connecting or originating at Reagan National and the load factors on 
those flights. 

Regarding the new beyond-perimeter flights' impact on capacity 
financing, using our estimate of the number of passengers who could 
shift from using Dulles to Reagan National, we asked MWAA to estimate 
the impact on the cost per enplaned passenger at the two airports. We 
also discussed the methodology that MWAA used and determined that its 
methods were sufficiently reliable for our purposes. We also reviewed 
credit-rating reports on MWAA and discussed the reports with rating 
agency officials. Moreover, we reviewed passenger traffic and airfare 
and Dulles and BWI data relating to the beyond-perimeter flight 
destinations that were added between 2000 and 2004. 

With respect to the impact that the new beyond-perimeter flights could 
have on aircraft noise, we reviewed the most recent noise 
compatibility report on Reagan National and noise complaints since 
2008 and interviewed individuals from community groups concerned about 
aircraft noise at Reagan National as well as officials from the 
Washington Council of Governments, the Arlington County (Va.) Council, 
MWAA, and FAA. 

To assess the impact that the new beyond-perimeter flights could have 
on passenger security screening wait times, we asked the 
Transportation Security Administration (TSA) to estimate, using its 
security screening throughput model, how the wait time would be 
affected. As inputs to the model, we provided TSA with the flight 
times for the new beyond-perimeter flights, data on the maximum number 
of passengers on those flights, and the screening checkpoints that the 
passengers would use. We did not report the precise estimates of wait 
time changes because they would imply a greater level of precision 
than the model could reasonably provide. 

To review whether slot controls at U.S. slot-controlled airports are 
working to reduce congestion, while maximizing available capacity and 
encouraging competition, we analyzed airline schedule data and FAA 
slot allocation data to determine the rate at which slots at slot-
controlled airports are scheduled. We also analyzed and compared and 
contrasted airline schedule data on aircraft size and flight frequency 
and Department of Transportation (DOT) data on average annual load 
factors and passenger traffic at the four slot-controlled airports 
with the remaining large hub airports[Footnote 77] that are not slot-
controlled. We interviewed officials from DOT; FAA; Department of 
Justice (DOJ); MWAA; and the Port Authority of New York and New 
Jersey, and interviewed representatives from 11 airlines that 
currently serve or have interest in serving one or more U.S. slot-
controlled airport. We also contacted other stakeholders, including 
representatives from Airlines For America; the International Air 
Transport Association; Airports Council International, North America; 
and others, about slot control issues. We also reviewed slot control 
regulations for the four U.S. slot-controlled airports and obtained 
and analyzed applicable federal laws, regulations, and agency orders. 
In addition, we reviewed studies on airline competition, airport 
capacity, and demand management measures, including slot controls, as 
well as the slot reform proposal for the European Union and the 
Worldwide Slot Guidelines. 

To calculate the rate at which slot allocations for scheduled 
passenger flights are scheduled at slot-controlled airports, we 
divided the total daily scheduled passenger flights within slot-
controlled hours for a specific day and airport by the total number of 
daily slot allocations (provided by FAA) for that day and airport. We 
obtained airline schedule data from Innovata for scheduled passenger 
flights for the third week of February and August 2011 for JFK, 
Newark, LaGuardia, and Reagan National. FAA provided the daily total 
slot allocation numbers for scheduled passenger flights during slot-
controlled hours for the same days for JFK, Newark, LaGuardia, and 
Reagan National.[Footnote 78] FAA officials told us that the third 
week of the month is most representative of the month. To further 
examine schedule rates at Newark, we also obtained and analyzed daily 
slot allocations and airline schedule data for the third Saturday of 
April, May, June, July, September, and October 2011 for Newark. During 
our review FAA reported discrepancies in the slot allocation numbers 
provided to us. Specifically, FAA does not systematically update their 
slot allocation records with the lists of returned slots received from 
airlines each season for JFK and Newark. As a result, the data on slot 
allocations used for our analysis for JFK and Newark generally 
represents the number of flights initially allocated to each airline 
for the season rather than the final number they held. 

To examine whether flights at slot-controlled airports use smaller 
aircraft, we conducted statistical analyses, including the 
construction of a logistic regression model to assess whether flights 
at slot-controlled airports use smaller aircraft than flights at other 
large hub airports that are not slot-controlled, while controlling for 
other factors that are likely associated with aircraft size, such as 
the flight distance (see appendix V for more details on our model and 
results). We analyzed Innovata airline schedule data for one Thursday 
each in February 2011 and in August 2011.[Footnote 79] Thursdays are 
generally considered to be a high-demand day, and February and August 
are representative months for the winter and summer seasons, 
respectively. We calculated the proportion of scheduled passenger 
flights arriving or departing each large hub airport that use aircraft 
with 100 seats or fewer. We also compared and contrasted the 
proportion of flights using aircraft with 100 seats or fewer departing 
or arriving slot-controlled airports with other large hub airports 
that are not slot-controlled. We tested that the difference was 
statistically significant. Since a variety of factors, in addition to 
slot controls, may be correlated with the use of a small aircraft, we 
developed a logistic regression model. The model assessed whether 
flights to or from slot-controlled airports used an aircraft with 100 
seats or fewer compared with flights that arrive and depart other 
large hub airports that are not slot-controlled, while controlling for 
other factors that include (1) whether the origin or destination of 
the flight is a high-tourism airport,[Footnote 80] (2) whether the 
airline marketing the flight is a legacy airline,[Footnote 81] (3) the 
daily frequency of flights to the same destination by the same 
airline, and (4) the flight distance. We also conducted alternative 
scenarios examining aircraft with 124 seats or fewer (the median-sized 
aircraft in our sample) and 80 seats or fewer. See appendix V for more 
details on the logistic regression model and results. 

To examine closely-scheduled flights to the same destination by the 
same airline, we analyzed airline schedule data, obtained from 
Innovata, for all flights arriving or departing FAA-identified large 
hub airports on Thursday February 10, 2011. For this analysis we 
calculated the number of minutes between each flight and the flight 
immediately prior to and following on the same route and by the same 
airline. We then identified those flights with another flight less 
than or equal to15 or 30 minutes apart, and calculated the proportion 
of such flights from each airport. 

Average annual load factor data and average annual airline yield data 
for large hub airports was obtained from DOT's T-100 database, which 
includes operational data collected from airlines and DOT's origin and 
destination survey, respectively. To calculate airlines' proportion of 
passenger traffic on domestic scheduled passenger flights, we obtained 
and analyzed data from DOT's origin and destination survey for 2011 at 
each of the large hub airports. 

To assess the reliability of airline schedule data, and DOT's T-100 
and origin and destination survey, we (1) reviewed existing 
documentation related to the data sources and (2) interviewed 
knowledgeable agency officials and representatives about the data. We 
determined that the data were sufficiently reliable for the purposes 
of this review. 

Appendix II: Comparative Information on Major Airports in the New York 
City and Washington, D.C., Area: 

Airport: Location; 
JFK: Queens County, NY, 15 miles from midtown Manhattan; 
LaGuardia: Borough of Queens, New York City, 8 miles from midtown 
Manhattan; 
Newark: Newark and Elizabeth, NJ, 14 miles from Manhattan; 
Reagan National: Arlington County, VA, 3 miles from downtown 
Washington, D.C.; 
Dulles: Chantilly, VA, 26 miles from downtown Washington, D.C.; 
BWI: Anne Arundel County, MD, 10 miles south of Baltimore and 32 miles 
north of Washington, D.C. 

Airport: Operator; 
JFK: Port Authority of New York and New Jersey; 
LaGuardia: Port Authority of New York and New Jersey; 
Newark: Port Authority of New York and New Jersey; 
Reagan National: Metropolitan Washington Airports Authority; 
Dulles: Metropolitan Washington Airports Authority; 
BWI: Maryland Department of Transportation's Aviation Administration. 

Airport: Acres of land; 
JFK: 4,930; 
LaGuardia: 680; 
Newark: 2,027; 
Reagan National: 733; 
Dulles: 11,830; 
BWI: 3,596. 

Airport: Number of runways; 
JFK: 4; 
14,572 feet 11,351 feet 10,000 feet 8,400 feet; 
LaGuardia: 2; 
both are 7,000 feet; 
Newark: 3; 
11,000 feet 9,980 feet 6,800 feet; 
Reagan National: 3; 
6,869 feet 5,204 feet 4,911 feet; 
Dulles: 4; 
2 are 11,500 feet 10,500 feet 9,400 feet; 
BWI: 4; 
10,502 feet 9,501 feet 6,000 feet 5,000 feet. 

Airport: Number of gates[A]; 
JFK: 124; 
LaGuardia: 76; 
Newark: 115; 
Reagan National: 44; 
Dulles: 139; 
BWI: 68. 

Airport: Number of airlines[A]; 
JFK: 77; 
LaGuardia: 17; 
Newark: 28; 
Reagan National: 11; 
Dulles: 29; 
BWI: 11. 

Airport: Airline holding the most slots[B]; 
JFK: Delta Air Lines (33 percent); 
LaGuardia: Delta Air Lines (44 percent); 
Newark: United Airlines (75 percent); 
Reagan National: US Airways (54 percent); 
Dulles: United Airlines (73 percent)c; 
BWI: Southwest Airlines (57 percent)[C]. 

Airport: 2010 enplanements; 
JFK: 22,892,372; 
LaGuardia: 11,988,578; 
Newark: 16,542,619; 
Reagan National: 8,726,183; 
Dulles: 11,251,041; 
BWI: 10,770,973. 

Airport: 2011 enplanements; 
JFK: 23,585,722; 
LaGuardia: 11,983,322; 
Newark: 16,786,357; 
Reagan National: 9,039,072; 
Dulles: 11,020,479; 
BWI: 10,985,559. 

Airport: Change in enplanements from 2010 to 2011; 
JFK: 3 percent; 
LaGuardia: 0 percent; 
Newark: 1.5 percent; 
Reagan National: 3.6 percent; 
Dulles: (2 percent); 
BWI: 2 percent. 

Airport: Domestic share of 2011 enplanements; 
JFK: 50 percent; 
LaGuardia: 96 percent; 
Newark: 66 percent; 
Reagan National: 98 percent; 
Dulles: 72 percent; 
BWI: 98 percent. 

Sources: MWAA, Port Authority of New York and New Jersey, BWI, and BTS. 

[A] As of June 2012. 

[B] As of May 15, 2012. 

[C] Because Dulles and BWI are not slot-controlled airports, the data 
reflect the airlines' percentage of total scheduled departures on May 
15, 2012, rather than the percentage of slots held. 

[End of table] 

[End of section] 

Appendix III: History of Slot Control Rules and Related Actions: 

Slot controls at Reagan National and the New York City area airports 
were first implemented in the late 1960s. Since then, the number of 
takeoffs and landings permitted at these airports has been revised 
periodically as well as the slot control procedures that airlines 
should follow. In addition, since the 1950s at LaGuardia and since the 
1960s at Reagan National, airlines have been subject to limitations on 
the distance of their nonstop flights known as "perimeter rules." 
Figure 7 shows when major events related to slot controls and 
perimeter rules occurred at the four airports. 

Figure 7: Timeline of Major Actions Taken Regarding Slot Controls and 
Perimeter Rules at the Major New York City Area Airports and Reagan 
National: 

[Refer to PDF for image: timeline] 

April 1969; 
Reagan National:	High Density Rule implemented[A];	
JFK:	High Density Rule implemented[A];	
LaGuardia:	High Density Rule implemented[A];	
Newark: High Density Rule implemented[A].	 

Date: October 1970; 
Newark: High Density Rule suspended[A].	 

Date: December 1981;	
Reagan National:	1,000-mile limit for nonstop	flights set[A].	 

Date: October 1985; 
1,250-mile limit for nonstop	flights enacted[B]. 

Date: April 2000; 	
Reagan National:	Twelve beyond-perimeter slot exemptions authorized[B];	
JFK:	High Density Rule to be phased	out by January 1, 2007[B];	
LaGuardia:	High Density Rule to be phased	out by January 1, 2007[B].	 

Date: December 2003; 
Reagan National:	Twelve more beyond-perimeter slot exemptions 
authorized[B].	 

Date: August 2006; 
LaGuardia:	Congestion management	rule proposed[A].	 

Date: January 2007; 
JFK:	High Density Rule	expired[B]; 
LaGuardia:	High Density Rule expired[B]. Temporary controls	
implemented by FAA order[A].	
	
Date: March 2008; 
JFK:	Temporary controls	implemented by FAA order[A]. 

Date: April 2008; 
LaGuardia:	Congestion management rule	proposed (second round)[A].	 

Date: May 2008; 
JFK:	Congestion management	rule proposed[A];	
Newark: Congestion management rule proposed[A].	 

Date: June 2008; 
Newark: Temporary controls	implemented by FAA order[A].	 

Date: October 2008; 
JFK:	Congestion management rule	effective December 2008[A];	
LaGuardia:	Congestion management rule	effective December 2008[A];	
Newark: Congestion management rule effective December 2008[A].	 

Date: October 2009; 
JFK:	Congestion management	rule rescinded[A];	
LaGuardia:	Congestion management	rule rescinded[A];	
Newark: Congestion management rule rescinded[A].	 

Date: April 2011; 
JFK:	Temporary slot controls extended	until a congestion management	
rule is effective or October 2013[A];	
LaGuardia:	Temporary slot controls extended	until a congestion 
management	rule is effective or October 2013[A];	
Newark: Temporary slot controls extended	until a congestion management	
rule is effective or October 2013[A].	 

Date: October 2011; 
Reagan National:	Slots transfer between Delta Air Lines and US Airways 
at Reagan National and LaGuardia approved, with conditions (final 
application)[A];	
LaGuardia:	Slots transfer between Delta Air Lines and US Airways at 
Reagan National and LaGuardia approved, with conditions (final 
application)[A].	 

Date: February 2012; 
Reagan National:	Eight more beyond-perimeter slot exemptions 
authorized and eight within-perimeter slots authorized to be converted 
to beyond perimeter slot exemptions[B]. 		 

Date: May 2012; 
Reagan National:	Eight new beyond-perimeter slot	exemptions awarded to 
airlines[A].	 

[A] DOT Office of the Secretary/FAA action. 
[B] Congressional	action. 

Sources: GAO	analysis of U.S. Code and FAA orders.		 

[End of figure] 

Slot controls were implemented in 1969 when the Federal Aviation 
Administration (FAA) designated JFK, LaGuardia, Newark, Chicago 
O'Hare, and Washington National[Footnote 82] as high density airports. 
In implementing what became known as the High Density Rule, FAA 
indicated that slot controls were needed to provide relief from 
excessive delays at these airports.[Footnote 83] Under the rule, FAA 
required airlines to obtain slots to operate during certain hours at 
those airports and initially imposed limits of 60 takeoffs and 
landings per hour at Newark, LaGuardia, and Washington National, and 
80 per hour at JFK. In 1970, FAA lifted the High Density Rule at 
Newark because of a lower level of usage of the slots at that airport 
as evidenced by, among other things, that the average number of 
aircraft operations at peak hours was 18 less than the 60 slots 
allowed.[Footnote 84] In general, Newark was not slot-controlled from 
late October 1970 until 2008.[Footnote 85] FAA implemented the High 
Density Rule in 1969 and, because of its effectiveness in reducing 
congestion and delays, extended it for an indefinite period of time in 
1973. Airline scheduling committees, operating under then-authorized 
antitrust immunity, conferred by the Civil Aeronautics Board, 
initially allocated the slots. However, according to FAA officials, 
after the Airline Deregulation Act of 1978 was enacted into 
law,[Footnote 86] increased airline competition made it more difficult 
for the scheduling committees to agree on slot allocations and 
antitrust immunity for the committees' operations expired under the 
terms of the Airline Deregulation Act. In 1986, as a part of its High 
Density Rule, FAA replaced the scheduling committees with slot 
procedures such as providing for the withdrawal of slots not used at 
least 65 percent of the time, the voluntary return of slots, the 
reallocation of withdrawn and returned slots, and allowing airlines to 
buy, sell, or lease their slots.[Footnote 87] In implementing this 
1986 minimum slot usage rule, FAA cited the Department of Justice's 
(DOJ) concerns that a use or lose provision "may be necessary to 
prevent large carriers or several large carriers from hoarding slots 
in an attempt to restrict service to drive up fares or keep smaller 
competitors from entering into or expanding in certain markets." 

In the 1990s, we,[Footnote 88] Transportation Research Board,[Footnote 
89] Department of Transportation (DOT)[Footnote 90], and new entrant 
carriers, respectively, studied the High Density Rule and presented 
reports and congressional testimony that the High Density Rule was a 
barrier to competition and to improved service, in part because new 
airlines were unable to establish service at the slot-controlled 
airports because of the lack of slot availability.[Footnote 91] 
Subsequently, in April 2000, Congress required that the application of 
the High Density Rule be phased out at JFK and LaGuardia airports by 
January 1, 2007, and directed DOT, in the interim to grant exemptions 
to the High Density Rule to allow for a certain number of flights 
operated by new entrant airlines and flights serving small hub and 
nonhub airports if the aircraft had fewer than 71 seats.[Footnote 92] 
By the fall of 2000, DOT had granted the exemptions required by 
statute, and airlines had added 300 scheduled flights at LaGuardia, 
resulting in a 144 percent increase in the average minutes of delay 
for arriving flights, from 15.52 minutes in March 2000 (a month before 
the law was enacted) to 37.86 minutes in September 2000. Furthermore, 
FAA reported that by September 2000, flight delays at LaGuardia 
accounted for 25 percent of the nation's delays, compared with 10 
percent during the previous year. To address congestion at LaGuardia, 
FAA reduced the number of daily slot exemptions and distributed the 
exemptions through a lottery.[Footnote 93] 

In 2006, FAA proposed a congestion management rule for LaGuardia that 
would have replaced the High Density Rule when it expired on January 
1, 2007.[Footnote 94] The proposed rule would have encouraged the use 
of larger aircraft by implementing an average aircraft size 
requirement (with proposed exemptions for service to small 
communities). However, because FAA did not expect to complete the 
congestion management rule before the High Density Rule expired, the 
agency imposed temporary slot controls at LaGuardia effective on 
January 1, 2007 (a maximum of 75 slots per hour) and required airlines 
to use slots at least 80 percent of the time.[Footnote 95] In 
addition, in 2007, the New York Aviation Rulemaking Committee[Footnote 
96] explored ways to reduce congestion and efficiently allocate scare 
capacity at the New York City area airports, including making 
operational and infrastructure improvements; using congestion pricing 
or auctions; requiring airlines to use larger aircraft; modifying gate 
allocations; amending or eliminating the perimeter rule; implementing 
priority aviation traffic preferences; or following International Air 
Transport Association's Worldwide Slot Guidelines. 

After JFK and Newark airports experienced flight delays during the 
summer of 2007, in October 2007, FAA announced operational targets of 
81 flights per hour from 3:00 p.m. to 7:59 p.m. at JFK. In March 2008, 
by order, FAA imposed temporary slot controls at JFK (a maximum of 81 
slots per hour)[Footnote 97] and in June 2008, by order, imposed 
temporary slot controls at Newark (a maximum of 81 slots per 
hour)[Footnote 98] and required airlines at those airports to use 
slots at least 80 percent of the time.[Footnote 99] Since 2008, FAA 
has extended the duration of the orders imposing slot controls at JFK, 
LaGuardia, and Newark; they are now in effect until October 2013 or 
until DOT's Office of the Secretary and FAA issue a congestion 
management rule.[Footnote 100] In April 2008, FAA proposed that the 
congestion management rule for LaGuardia include two different options 
for auctioning new or returned slots at LaGuardia whereby under one 
option, the agency would have kept the proceeds and under the second 
option, the proceeds would have gone to the incumbent carrier holding 
the slot.[Footnote 101] In May 2008, FAA proposed applying such 
congestion management rules to JFK and Newark.[Footnote 102] In 
October 2008, FAA published final congestion management rules for JFK, 
LaGuardia, and Newark assigning to existing operators the majority of 
slots at the airports and creating a market by annually auctioning off 
a limited number of slots in each of the first 5 years of the 10-year 
rule.[Footnote 103] Before going into effect, on October 9, 2009, FAA 
rescinded[Footnote 104] the final rules for the congestion management 
rules for JFK, LaGuardia, and Newark citing, among other things, that 
the rulemakings had been highly controversial, a court challenge, and 
a resulting December 2008 United States Court of Appeals for the 
District of Columbia Circuit ruling[Footnote 105] that put on hold the 
implementation of the congestion management rules and their slot 
auction provisions.[Footnote 106] In its rescission of the congestion 
management rules, FAA additionally cited fiscal year 2009 
appropriations act legislation[Footnote 107] providing, among other 
things, a statutory prohibition on using fiscal year 2009 funds to 
take any action regarding the auctioning of rights or permission to 
conduct airlines operations at U.S. commercial airports.[Footnote 108] 
Subsequent to the rescission of the slot auction rules, FAA sought a 
dismissal of the case that was granted on October 14, 2009.[Footnote 
109] 

In 2010, DOT's Office of the Secretary and FAA began drafting a "Slot 
Management and Transparency" rule for the New York City area 
airports.[Footnote 110] According to DOT, this rulemaking would 
replace the current temporary orders limiting scheduled aircraft 
operations at JFK, LaGuardia, and Newark with a more permanent rule to 
address congestion and delay while also promoting fair access and 
competition. DOT's rulemaking is also aimed at ensuring that 
congestion and delay are minimized by limiting scheduled and 
unscheduled aircraft operations. Although the temporary orders 
prohibit the buying and selling of slots at the New York City area 
airports, according to DOT, the rulemaking would establish a secondary 
market for U.S. and foreign air carriers to buy, sell, trade, and 
lease slots at the three airports and "allow carriers serving or 
seeking to serve the New York area airports to exchange slots as their 
business models and strategic goals require." Under DOT's rulemaking 
schedule, the department was to provide the draft to the Office of 
Management and Budget for review by April 25, 2011, but as of July 
2012, that had not yet occurred. At present, the High Density Rule 
applies only to Reagan National. 

In 2009, Delta Air Lines and US Airways proposed trading slots that 
they held at LaGuardia and Reagan National, a trade that would allow 
Delta to establish a domestic hub at LaGuardia and US Airways to 
enhance its network at Reagan National. The airlines sought FAA's 
permission because the transaction was considered a purchase of slots 
that, under the order limiting operations at LaGuardia, was not 
allowed. Under the proposal, Delta would transfer 42 slot pairs it 
held at Reagan National in exchange for 125 slot pairs at LaGuardia, 
among other provisions. DOT's Office of the Secretary and FAA granted 
the waiver request with conditions to counteract a substantial 
increase in market concentration by the two airlines that would result 
at those airports and to provide an opportunity for low cost airlines 
to compete, which required them to divest 14 pairs of slots at Reagan 
National and 20 pairs of slots at LaGuardia to new entrant and limited 
incumbent airlines (those holding less than 5 percent of slots at 
Reagan National and LaGuardia).[Footnote 111] However, Delta and US 
Airways decided not to proceed with the transaction under these 
conditions. In 2011, the two airlines reapplied for permission to 
exchange slots. Under the revised proposal, Delta would acquire 132 
slot pairs (265 slots) at LaGuardia from US Airways and US Airways 
would acquire 42 slot pairs at LaGuardia from Delta, among other 
provisions. Delta would also pay US Airways $65 million. In their 
application, the two airlines said consumers would benefit from the 
transaction through, among other things, improved connectivity at 
LaGuardia and Reagan National and by using larger aircraft. DOT's 
Office of the Secretary and FAA approved the transaction and granted 
the waiver request from the temporary order's prohibition on 
purchasing slots, with conditions, citing expected consumer benefits 
and the increased presence of low cost airlines at LaGuardia and 
Reagan National since the previous application.[Footnote 112] The 
conditions required Delta and US Airways to divest to new entrants and 
limited incumbents fewer slots--8 slot pairs at Reagan National and 16 
slot pairs at LaGuardia--than DOT's Office of the Secretary and FAA 
had required when they approved the first application. DOT's Office of 
the Secretary and FAA directed that the divested slots be sold through 
a bidding process, permitting Delta and US Airways to keep the 
proceeds. In 2011, Jet Blue purchased 8 slot pairs at LaGuardia for 
$32 million and 8 slot pairs at Reagan National for $40 million, and 
West Jet purchased 8 slot pairs at LaGuardia for $17.6 million. 

Perimeter Rules Subject Airlines to Flight Distance Limitations to and 
from Reagan National and LaGuardia: 

Since the 1950s, the Port Authority of New York and New Jersey, which 
operates the New York City area airports, has had a rule limiting the 
distance of nonstop flights into and out of LaGuardia known as the 
perimeter rule. Until 1984, the perimeter rule was informal and 
prohibited nonstop flights into or out of LaGuardia to or from 
destinations more than 2,000 miles from the airport. In 1984, the Port 
Authority formally instituted a 1,500-mile perimeter rule but exempted 
service to Denver, which is more than 1,600 miles from LaGuardia, and 
flights on Saturdays. 

In 1966, airlines at Reagan National voluntarily agreed to limit 
nonstop flights from the airport to destinations less than 650 miles 
away, with some exceptions. The Metropolitan Washington Airports 
Authority Act of 1986, enacted into law in October 1986, authorized 
the transfer of authority over Reagan National and Dulles from the 
federal government to the Metropolitan Washington Airports Authority, 
set Reagan National's perimeter rule at 1,250 miles, and prohibited 
the Airports Authority from increasing slot limits at Reagan National 
set in FAA's High Density Rule.[Footnote 113] Two federal laws 
respectively enacted in 2000 and 2003 (the Wendell H. Ford Aviation 
Investment and Reform Act for the 21st Century[Footnote 114] (AIR-21) 
and the Vision 100-Century of Aviation Reauthorization Act[Footnote 
115] (Vision 100)) enacted statutory modifications relating to the 
slot and perimeter rules at Reagan National. Among other things, AIR-
21 required the Secretary of Transportation to grant 12 beyond 
perimeter and 12 within perimeter exemptions at Reagan National. 
Vision 100 amendments increased these numbers to 24 beyond perimeter 
exemptions and 20 within perimeter exemptions.[Footnote 116] In 
effect, AIR-21 and Vision 100, combined, required the Secretary of 
Transportation to award 22 round trips, 12 with service to airports 
beyond the perimeter and 10 with service to airports within the 
perimeter.[Footnote 117] In 2012, the FAA Modernization and Reform Act 
of 2012[Footnote 118] was enacted into law, which reauthorized FAA, 
authorized 16 additional beyond perimeter exemptions at Reagan 
National comprised of eight within-perimeter flights to large hub 
airports to be converted to nonstop beyond-perimeter flights (four 
round-trips) and eight new additional nonstop beyond-perimeter flights 
(four round trips). With respect to the converted flights, under the 
2012 act, each incumbent airline with 40 or more slots at Reagan 
National could convert one within-perimeter slot pair to one beyond-
perimeter slot pair,[Footnote 119] while the new beyond-perimeter 
slots were to be awarded to new entrants or airlines holding fewer 
than 40 slots. As the converted nonstop beyond-perimeter destinations, 
the incumbent airlines chose Los Angeles (American Airlines); Salt 
Lake City (Delta Air Lines); San Diego (US Airways); and San Francisco 
(United Airlines). Seven airlines applied for the four new beyond-
perimeter slot pair exemptions, which, on May 14, 2012, DOT awarded to 
Alaska Airlines for Portland, Ore.; Jet Blue for San Juan, Puerto 
Rico; Southwest Airlines for Austin, Tex.; and Virgin America for San 
Francisco. 

[End of section] 

Appendix IV: Trends in Average Annual Passenger Traffic and Airfares 
at Selected Washington, D.C., Area Airports: 

Figures 8 through 31 below show the trends in average annual passenger 
traffic and airfares at Baltimore-Washington International Thurgood 
Marshall Airport (BWI) and Dulles International Airport (Dulles) for 
destinations granted beyond-perimeter slot exemptions at Reagan 
National Airport (Reagan National) under AIR-21 and Vision 100 between 
2000 and 2004. 

Figure 8: Indexed Average Passenger Traffic for All BWI Domestic 
Flights and Flights between BWI and Denver International Airport, 2000 
to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed annual passenger traffic: 

Year: 2000; 
BWI to Denver International: 100; 
BWI to all domestic destinations: 100. 

Year: 2001; 
BWI to Denver International: 87.4; 
BWI to all domestic destinations: 101.7. 

Year: 2002; 
BWI to Denver International: 98.4; 
BWI to all domestic destinations: 95.2. 

Year: 2003; 
BWI to Denver International: 96.1; 
BWI to all domestic destinations: 98. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
BWI to Denver International: 88.7; 
BWI to all domestic destinations: 98.5. 

Year: 2005; 
BWI to Denver International: 94.1; 
BWI to all domestic destinations: 96.1. 

Year: 2006; 
BWI to Denver International: 137.5; 
BWI to all domestic destinations: 101. 

Year: 2007; 
BWI to Denver International: 144.2; 
BWI to all domestic destinations: 101.7. 

Year: 2008; 
BWI to Denver International: 122.1; 
BWI to all domestic destinations: 98.4. 

Year: 2009; 
BWI to Denver International: 121.6; 
BWI to all domestic destinations: 97.7. 

Year: 2010; 
BWI to Denver International: 131.1; 
BWI to all domestic destinations: 97.6. 

Year: 2011; 
BWI to Denver International: 138.9; 
BWI to all domestic destinations: 96.7. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 9: Indexed Average Annual Airfare for All BWI Domestic Flights 
and Flights between BWI and Denver International Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed average annual airfare: 

Year: 2000; 
BWI to Denver International: 100; 
BWI to all domestic destinations: 100. 

Year: 2001; 
BWI to Denver International: 98.4; 
BWI to all domestic destinations: 93.4. 

Year: 2002; 
BWI to Denver International: 85.2; 
BWI to all domestic destinations: 90.5. 

Year: 2003; 
BWI to Denver International: 83.4; 
BWI to all domestic destinations: 89.4. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
BWI to Denver International: 81.4; 
BWI to all domestic destinations: 87.2. 

Year: 2005; 
BWI to Denver International: 78.1; 
BWI to all domestic destinations: 87.8. 

Year: 2006; 
BWI to Denver International: 71.1; 
BWI to all domestic destinations: 94.6. 

Year: 2007; 
BWI to Denver International: 69.8; 
BWI to all domestic destinations: 94.8. 

Year: 2008; 
BWI to Denver International: 82.8; 
BWI to all domestic destinations: 105.9. 

Year: 2009; 
BWI to Denver International: 74.2; 
BWI to all domestic destinations: 94.7. 

Year: 2010; 
BWI to Denver International: 78.7; 
BWI to all domestic destinations: 105.6. 

Year: 2011; 
BWI to Denver International: 82.4; 
BWI to all domestic destinations: 119. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 10: Indexed Average Annual Passenger Traffic for All BWI 
Domestic Flights and Flights between BWI and Las Vegas McCarran 
International Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed annual passenger traffic: 

Year: 2000; 
BWI to Las Vegas McCarran International: 100; 
BWI to all domestic destinations: 100. 

Year: 2001; 
BWI to Las Vegas McCarran International: 104.1; 
BWI to all domestic destinations: 101.7. 

Year: 2002; 
BWI to Las Vegas McCarran International: 106.9; 
BWI to all domestic destinations: 95.2. 

Year: 2003; 
BWI to Las Vegas McCarran International: 123.6; 
BWI to all domestic destinations: 98. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
BWI to Las Vegas McCarran International: 115.4; 
BWI to all domestic destinations: 98.5. 

Year: 2005; 
BWI to Las Vegas McCarran International: 112.9; 
BWI to all domestic destinations: 96.1. 

Year: 2006; 
BWI to Las Vegas McCarran International: 110.8; 
BWI to all domestic destinations: 101. 

Year: 2007; 
BWI to Las Vegas McCarran International: 114.3; 
BWI to all domestic destinations: 101.7. 

Year: 2008; 
BWI to Las Vegas McCarran International: 99.1; 
BWI to all domestic destinations: 98.4. 

Year: 2009; 
BWI to Las Vegas McCarran International: 90.7; 
BWI to all domestic destinations: 97.7. 

Year: 2010; 
BWI to Las Vegas McCarran International: 86.9; 
BWI to all domestic destinations: 97.6. 

Year: 2011; 
BWI to Las Vegas McCarran International: 88.6; 
BWI to all domestic destinations: 96.7. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 11: Indexed Average Annual Airfares for All BWI Domestic 
Flights and Flights between BWI and Las Vegas McCarran International 
Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed average annual airfare: 

Year: 2000; 
BWI to Las Vegas McCarran International: 100; 
BWI to all domestic destinations: 100. 

Year: 2001; 
BWI to Las Vegas McCarran International: 89.5; 
BWI to all domestic destinations: 93.4. 

Year: 2002; 
BWI to Las Vegas McCarran International: 90.9; 
BWI to all domestic destinations: 90.5. 

Year: 2003; 
BWI to Las Vegas McCarran International: 94.9; 
BWI to all domestic destinations: 89.4. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
BWI to Las Vegas McCarran International: 92.3; 
BWI to all domestic destinations: 87.2. 

Year: 2005; 
BWI to Las Vegas McCarran International: 96.9; 
BWI to all domestic destinations: 87.8. 

Year: 2006; 
BWI to Las Vegas McCarran International: 112.5; 
BWI to all domestic destinations: 94.6. 

Year: 2007; 
BWI to Las Vegas McCarran International: 108.2; 
BWI to all domestic destinations: 94.8. 

Year: 2008; 
BWI to Las Vegas McCarran International: 123; 
BWI to all domestic destinations: 105.9. 

Year: 2009; 
BWI to Las Vegas McCarran International: 111.5; 
BWI to all domestic destinations: 94.7. 

Year: 2010; 
BWI to Las Vegas McCarran International: 129.9; 
BWI to all domestic destinations: 105.6. 

Year: 2011; 
BWI to Las Vegas McCarran International: 149.8; 
BWI to all domestic destinations: 119. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 12: Indexed Average Passenger Traffic for All BWI Domestic 
Flights and Flights between BWI and Los Angeles International Airport, 
2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed annual passenger traffic: 

Year: 2000; 
BWI to Los Angeles International: 100; 
BWI to all domestic destinations: 100. 

Year: 2001; 
BWI to Los Angeles International: 92.6; 
BWI to all domestic destinations: 101.7. 

Year: 2002; 
BWI to Los Angeles International: 77; 
BWI to all domestic destinations: 95.2. 

Year: 2003; 
BWI to Los Angeles International: 74.5; 
BWI to all domestic destinations: 98. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
BWI to Los Angeles International: 74.5; 
BWI to all domestic destinations: 98.5. 

Year: 2005; 
BWI to Los Angeles International: 67; 
BWI to all domestic destinations: 96.1. 

Year: 2006; 
BWI to Los Angeles International: 74; 
BWI to all domestic destinations: 101. 

Year: 2007; 
BWI to Los Angeles International: 63.9; 
BWI to all domestic destinations: 101.7. 

Year: 2008; 
BWI to Los Angeles International: 51.7; 
BWI to all domestic destinations: 98.4. 

Year: 2009; 
BWI to Los Angeles International: 55.1; 
BWI to all domestic destinations: 97.7. 

Year: 2010; 
BWI to Los Angeles International: 62.5; 
BWI to all domestic destinations: 97.6. 

Year: 2011; 
BWI to Los Angeles International: 65.2; 
BWI to all domestic destinations: 96.7. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 13: Indexed Average Annual Airfares for All BWI Domestic 
Flights and Flights between BWI and Los Angeles International Airport, 
2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed average annual airfare: 

Year: 2000; 
BWI to Los Angeles International: 100; 
BWI to all domestic destinations: 100. 

Year: 2001; 
BWI to Los Angeles International: 91.9; 
BWI to all domestic destinations: 93.4. 

Year: 2002; 
BWI to Los Angeles International: 89.4; 
BWI to all domestic destinations: 90.5. 

Year: 2003; 
BWI to Los Angeles International: 89.6; 
BWI to all domestic destinations: 89.4. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
BWI to Los Angeles International: 83.7; 
BWI to all domestic destinations: 87.2. 

Year: 2005; 
BWI to Los Angeles International: 85.4; 
BWI to all domestic destinations: 87.8. 

Year: 2006; 
BWI to Los Angeles International: 90.3; 
BWI to all domestic destinations: 94.6. 

Year: 2007; 
BWI to Los Angeles International: 98.1; 
BWI to all domestic destinations: 94.8. 

Year: 2008; 
BWI to Los Angeles International: 110.4; 
BWI to all domestic destinations: 105.9. 

Year: 2009; 
BWI to Los Angeles International: 93.2 
BWI to all domestic destinations: 94.7. 

Year: 2010; 
BWI to Los Angeles International: 102.2; 
BWI to all domestic destinations: 105.6. 

Year: 2011; 
BWI to Los Angeles International: 116.7; 
BWI to all domestic destinations: 119. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 14: Indexed Average Passenger Traffic for All BWI Domestic 
Flights and Flights between BWI and Phoenix Sky Harbor International 
Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed annual passenger traffic: 

Year: 2000; 
BWI to Phoenix Sky Harbor International: 100; 
BWI to all domestic destinations: 100. 

Year: 2001; 
BWI to Phoenix Sky Harbor International: 99.4; 
BWI to all domestic destinations: 101.7. 

Year: 2002; 
BWI to Phoenix Sky Harbor International: 87.2; 
BWI to all domestic destinations: 95.2. 

Year: 2003; 
BWI to Phoenix Sky Harbor International: 92.1; 
BWI to all domestic destinations: 98. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
BWI to Phoenix Sky Harbor International: 88.6; 
BWI to all domestic destinations: 98.5. 

Year: 2005; 
BWI to Phoenix Sky Harbor International: 83.9; 
BWI to all domestic destinations: 96.1. 

Year: 2006; 
BWI to Phoenix Sky Harbor International: 85.7; 
BWI to all domestic destinations: 101. 

Year: 2007; 
BWI to Phoenix Sky Harbor International: 84.6; 
BWI to all domestic destinations: 101.7. 

Year: 2008; 
BWI to Phoenix Sky Harbor International: 76.4; 
BWI to all domestic destinations: 98.4. 

Year: 2009; 
BWI to Phoenix Sky Harbor International: 72.1; 
BWI to all domestic destinations: 97.7. 

Year: 2010; 
BWI to Phoenix Sky Harbor International: 77; 
BWI to all domestic destinations: 97.6. 

Year: 2011; 
BWI to Phoenix Sky Harbor International: 75; 
BWI to all domestic destinations: 96.7. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 15: Indexed Average Airfares for All BWI Domestic Flights and 
Flights between BWI and Phoenix Sky Harbor International Airport, 2000 
to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed average annual airfare: 

Year: 2000; 
BWI to Phoenix Sky Harbor International: 100; 
BWI to all domestic destinations: 100. 

Year: 2001; 
BWI to Phoenix Sky Harbor International: 89.4; 
BWI to all domestic destinations: 93.4. 

Year: 2002; 
BWI to Phoenix Sky Harbor International: 87; 
BWI to all domestic destinations: 90.5. 

Year: 2003; 
BWI to Phoenix Sky Harbor International: 84.2; 
BWI to all domestic destinations: 89.4. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
BWI to Phoenix Sky Harbor International: 84.4; 
BWI to all domestic destinations: 87.2. 

Year: 2005; 
BWI to Phoenix Sky Harbor International: 90.9; 
BWI to all domestic destinations: 87.8. 

Year: 2006; 
BWI to Phoenix Sky Harbor International: 104.6; 
BWI to all domestic destinations: 94.6. 

Year: 2007; 
BWI to Phoenix Sky Harbor International: 103.5; 
BWI to all domestic destinations: 94.8. 

Year: 2008; 
BWI to Phoenix Sky Harbor International: 118.4; 
BWI to all domestic destinations: 105.9. 

Year: 2009; 
BWI to Phoenix Sky Harbor International: 108.1; 
BWI to all domestic destinations: 94.7. 

Year: 2010; 
BWI to Phoenix Sky Harbor International: 122.2; 
BWI to all domestic destinations: 105.6. 

Year: 2011; 
BWI to Phoenix Sky Harbor International: 132.2; 
BWI to all domestic destinations: 119. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 16: Indexed Average Passenger Traffic for All BWI Domestic 
Flights and Flights between BWI and Salt Lake City International 
Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed annual passenger traffic: 

Year: 2000; 
BWI to Salt Lake City International: 100; 
BWI to all domestic destinations: 100. 

Year: 2001; 
BWI to Salt Lake City International: 116.4; 
BWI to all domestic destinations: 101.7. 

Year: 2002; 
BWI to Salt Lake City International: 107.7; 
BWI to all domestic destinations: 95.2. 

Year: 2003; 
BWI to Salt Lake City International: 108.6; 
BWI to all domestic destinations: 98. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
BWI to Salt Lake City International: 100.9; 
BWI to all domestic destinations: 98.5. 

Year: 2005; 
BWI to Salt Lake City International: 109.8; 
BWI to all domestic destinations: 96.1. 

Year: 2006; 
BWI to Salt Lake City International: 111.9; 
BWI to all domestic destinations: 101. 

Year: 2007; 
BWI to Salt Lake City International: 99.1; 
BWI to all domestic destinations: 101.7. 

Year: 2008; 
BWI to Salt Lake City International: 90.6; 
BWI to all domestic destinations: 98.4. 

Year: 2009; 
BWI to Salt Lake City International: 92.2; 
BWI to all domestic destinations: 97.7. 

Year: 2010; 
BWI to Salt Lake City International: 103.3; 
BWI to all domestic destinations: 94.6. 

Year: 2011; 
BWI to Salt Lake City International: 75; 
BWI to all domestic destinations: 96.7. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 17: Indexed Average Airfares for All BWI Domestic Flights and 
Flights between BWI and Salt Lake City International Airport, 2000 to 
2011: 

[Refer to PDF for image: multiple line graph] 

Indexed average annual airfare: 

Year: 2000; 
BWI to Salt Lake City International: 100; 
BWI to all domestic destinations: 100. 

Year: 2001; 
BWI to Salt Lake City International: 92.4; 
BWI to all domestic destinations: 93.4. 

Year: 2002; 
BWI to Salt Lake City International: 96.3; 
BWI to all domestic destinations: 90.5. 

Year: 2003; 
BWI to Salt Lake City International: 92; 
BWI to all domestic destinations: 89.4. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
BWI to Salt Lake City International: 88.1; 
BWI to all domestic destinations: 87.2. 

Year: 2005; 
BWI to Salt Lake City International: 94.8; 
BWI to all domestic destinations: 87.8. 

Year: 2006; 
BWI to Salt Lake City International: 109.3; 
BWI to all domestic destinations: 94.6. 

Year: 2007; 
BWI to Salt Lake City International: 119.2; 
BWI to all domestic destinations: 94.8. 

Year: 2008; 
BWI to Salt Lake City International: 127.8; 
BWI to all domestic destinations: 105.9. 

Year: 2009; 
BWI to Salt Lake City International: 118.5; 
BWI to all domestic destinations: 94.7. 

Year: 2010; 
BWI to Salt Lake City International: 135.8; 
BWI to all domestic destinations: 105.6. 

Year: 2011; 
BWI to Salt Lake City International: 151.3; 
BWI to all domestic destinations: 119. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 18: Indexed Average Passenger Traffic for All BWI Domestic 
Flights and Flights between BWI and Seattle-Tacoma International 
Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed annual passenger traffic: 

Year: 2000; 
BWI to Seattle-Tacoma International: 100; 
BWI to all domestic destinations: 100. 

Year: 2001; 
BWI to Seattle-Tacoma International: 110.9; 
BWI to all domestic destinations: 101.7. 

Year: 2002; 
BWI to Seattle-Tacoma International: 84.3; 
BWI to all domestic destinations: 95.2. 

Year: 2003; 
BWI to Seattle-Tacoma International: 82.6; 
BWI to all domestic destinations: 98. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
BWI to Seattle-Tacoma International: 79.9; 
BWI to all domestic destinations: 98.5. 

Year: 2005; 
BWI to Seattle-Tacoma International: 75.6; 
BWI to all domestic destinations: 96.1. 

Year: 2006; 
BWI to Seattle-Tacoma International: 85.9; 
BWI to all domestic destinations: 101. 

Year: 2007; 
BWI to Seattle-Tacoma International: 83.4; 
BWI to all domestic destinations: 101.7. 

Year: 2008; 
BWI to Seattle-Tacoma International: 98.5; 
BWI to all domestic destinations: 98.4. 

Year: 2009; 
BWI to Seattle-Tacoma International: 101; 
BWI to all domestic destinations: 97.7. 

Year: 2010; 
BWI to Seattle-Tacoma International: 97.6; 
BWI to all domestic destinations: 94.6. 

Year: 2011; 
BWI to Seattle-Tacoma International: 87.3; 
BWI to all domestic destinations: 96.7. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 19: Indexed Average Airfares for All BWI Domestic Flights and 
Flights between BWI and Seattle-Tacoma International Airport, 2000 to 
2011: 

[Refer to PDF for image: multiple line graph] 

Indexed average annual airfare: 

Year: 2000; 
BWI to Seattle-Tacoma International: 100; 
BWI to all domestic destinations: 100. 

Year: 2001; 
BWI to Seattle-Tacoma International: 85.3; 
BWI to all domestic destinations: 93.4. 

Year: 2002; 
BWI to Seattle-Tacoma International: 84.3; 
BWI to all domestic destinations: 90.5. 

Year: 2003; 
BWI to Seattle-Tacoma International: 83.3; 
BWI to all domestic destinations: 89.4. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
BWI to Seattle-Tacoma International: 77.8; 
BWI to all domestic destinations: 87.2. 

Year: 2005; 
BWI to Seattle-Tacoma International: 82.4; 
BWI to all domestic destinations: 87.8. 

Year: 2006; 
BWI to Seattle-Tacoma International: 91.2; 
BWI to all domestic destinations: 94.6. 

Year: 2007; 
BWI to Seattle-Tacoma International: 93.6; 
BWI to all domestic destinations: 94.8. 

Year: 2008; 
BWI to Seattle-Tacoma International: 93.6; 
BWI to all domestic destinations: 105.9. 

Year: 2009; 
BWI to Seattle-Tacoma International: 79.7; 
BWI to all domestic destinations: 94.7. 

Year: 2010; 
BWI to Seattle-Tacoma International: 95.7; 
BWI to all domestic destinations: 105.6. 

Year: 2011; 
BWI to Seattle-Tacoma International: 114.6; 
BWI to all domestic destinations: 119. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 20: Indexed Average Passenger Traffic for All Dulles Domestic 
Flights and Flights between Dulles and Denver International Airport, 
2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed annual passenger traffic: 

Year: 2000; 
Dulles to Denver International: 100; 
Dulles to all domestic destinations: 100. 

Year: 2001; 
Dulles to Denver International: 95.2; 
Dulles to all domestic destinations: 84.3. 

Year: 2002; 
Dulles to Denver International: 89.2; 
Dulles to all domestic destinations: 79.5. 

Year: 2003; 
Dulles to Denver International: 91.6; 
Dulles to all domestic destinations: 83.8. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
Dulles to Denver International: 108.7; 
Dulles to all domestic destinations: 112.7. 

Year: 2005; 
Dulles to Denver International: 94.3; 
Dulles to all domestic destinations: 131.5. 

Year: 2006; 
Dulles to Denver International: 96.1; 
Dulles to all domestic destinations: 110.1. 

Year: 2007; 
Dulles to Denver International: 95.5; 
Dulles to all domestic destinations: 112.1. 

Year: 2008; 
Dulles to Denver International: 94.5; 
Dulles to all domestic destinations: 102.5. 

Year: 2009; 
Dulles to Denver International: 81.8; 
Dulles to all domestic destinations: 93.4. 

Year: 2010; 
Dulles to Denver International: 90.6; 
Dulles to all domestic destinations: 93.8. 

Year: 2011; 
Dulles to Denver International: 91.9; 
Dulles to all domestic destinations: 90.7. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 21: Indexed Average Airfares for All Dulles Domestic Flights 
and Flights between Dulles and Denver International Airport, 2000 to 
2011: 

[Refer to PDF for image: multiple line graph] 

Indexed average annual airfare: 

Year: 2000; 
Dulles to Denver International: 100; 
Dulles to all domestic destinations: 100. 

Year: 2001; 
Dulles to Denver International: 88.7; 
Dulles to all domestic destinations: 98.6. 

Year: 2002; 
Dulles to Denver International: 81.6; 
Dulles to all domestic destinations: 94.7. 

Year: 2003; 
Dulles to Denver International: 73; 
Dulles to all domestic destinations: 89.5. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
Dulles to Denver International: 62.3; 
Dulles to all domestic destinations: 75.1. 

Year: 2005; 
Dulles to Denver International: 69; 
Dulles to all domestic destinations: 68. 

Year: 2006; 
Dulles to Denver International: 75.6; 
Dulles to all domestic destinations: 84.1. 

Year: 2007; 
Dulles to Denver International: 75.1; 
Dulles to all domestic destinations: 85.1. 

Year: 2008; 
Dulles to Denver International: 78.8; 
Dulles to all domestic destinations: 94.9. 

Year: 2009; 
Dulles to Denver International: 77.6; 
Dulles to all domestic destinations: 86.1. 

Year: 2010; 
Dulles to Denver International: 82.5; 
Dulles to all domestic destinations: 94.1. 

Year: 2011; 
Dulles to Denver International: 86; 
Dulles to all domestic destinations: 104. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 22: Indexed Average Annual Passenger Traffic for All Dulles 
Domestic Flights and Flights between Dulles and Las Vegas McCarran 
International Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed annual passenger traffic: 

Year: 2000; 
Dulles to Las Vegas McCarran International: 100; 
Dulles to all domestic destinations: 100. 

Year: 2001; 
Dulles to Las Vegas McCarran International: 105.9; 
Dulles to all domestic destinations: 84.3. 

Year: 2002; 
Dulles to Las Vegas McCarran International: 127.3; 
Dulles to all domestic destinations: 79.5. 

Year: 2003; 
Dulles to Las Vegas McCarran International: 164; 
Dulles to all domestic destinations: 83.8. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
Dulles to Las Vegas McCarran International: 271.4; 
Dulles to all domestic destinations: 112.7. 

Year: 2005; 
Dulles to Las Vegas McCarran International: 391.4; 
Dulles to all domestic destinations: 131.5. 

Year: 2006; 
Dulles to Las Vegas McCarran International: 420.6; 
Dulles to all domestic destinations: 110.1. 

Year: 2007; 
Dulles to Las Vegas McCarran International: 496.2; 
Dulles to all domestic destinations: 112.1. 

Year: 2008; 
Dulles to Las Vegas McCarran International: 383.6; 
Dulles to all domestic destinations: 102.5. 

Year: 2009; 
Dulles to Las Vegas McCarran International: 315; 
Dulles to all domestic destinations: 93.4. 

Year: 2010; 
Dulles to Las Vegas McCarran International: 319.6; 
Dulles to all domestic destinations: 93.8. 

Year: 2011; 
Dulles to Las Vegas McCarran International: 286.6; 
Dulles to all domestic destinations: 90.7. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 23: Indexed Average Annual Airfares for All Dulles Domestic 
Flights and Flights between Dulles and Las Vegas McCarran 
International Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed average annual airfare: 

Year: 2000; 
Dulles to Las Vegas McCarran International: 100; 
Dulles to all domestic destinations: 100. 

Year: 2001; 
Dulles to Las Vegas McCarran International: 79.4; 
Dulles to all domestic destinations: 98.6. 

Year: 2002; 
Dulles to Las Vegas McCarran International: 72.9; 
Dulles to all domestic destinations: 94.7. 

Year: 2003; 
Dulles to Las Vegas McCarran International: 74.3; 
Dulles to all domestic destinations: 89.5. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
Dulles to Las Vegas McCarran International: 59.4; 
Dulles to all domestic destinations: 75.1. 

Year: 2005; 
Dulles to Las Vegas McCarran International: 52.3; 
Dulles to all domestic destinations: 68. 

Year: 2006; 
Dulles to Las Vegas McCarran International: 59.8; 
Dulles to all domestic destinations: 84.1. 

Year: 2007; 
Dulles to Las Vegas McCarran International: 55.1; 
Dulles to all domestic destinations: 85.1. 

Year: 2008; 
Dulles to Las Vegas McCarran International: 67; 
Dulles to all domestic destinations: 94.9. 

Year: 2009; 
Dulles to Las Vegas McCarran International: 65.3; 
Dulles to all domestic destinations: 86.1. 

Year: 2010; 
Dulles to Las Vegas McCarran International: 74.7; 
Dulles to all domestic destinations: 94.1. 

Year: 2011; 
Dulles to Las Vegas McCarran International: 86; 
Dulles to all domestic destinations: 104. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 24: Indexed Average Annual Passenger Traffic for All Dulles 
Domestic Flights and Flights between Dulles and Los Angeles 
International Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed annual passenger traffic: 

Year: 2000; 
Dulles to Los Angeles International: 100; 
Dulles to all domestic destinations: 100. 

Year: 2001; 
Dulles to Los Angeles International: 86.3; 
Dulles to all domestic destinations: 84.3. 

Year: 2002; 
Dulles to Los Angeles International: 79.3; 
Dulles to all domestic destinations: 79.5. 

Year: 2003; 
Dulles to Los Angeles International: 83.9; 
Dulles to all domestic destinations: 83.8. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
Dulles to Los Angeles International: 110.1; 
Dulles to all domestic destinations: 112.7. 

Year: 2005; 
Dulles to Los Angeles International: 120.5; 
Dulles to all domestic destinations: 131.5. 

Year: 2006; 
Dulles to Los Angeles International: 109; 
Dulles to all domestic destinations: 110.1. 

Year: 2007; 
Dulles to Los Angeles International: 111.9; 
Dulles to all domestic destinations: 112.1. 

Year: 2008; 
Dulles to Los Angeles International: 143.3; 
Dulles to all domestic destinations: 102.5. 

Year: 2009; 
Dulles to Los Angeles International: 147.6; 
Dulles to all domestic destinations: 93.4. 

Year: 2010; 
Dulles to Los Angeles International: 143.5; 
Dulles to all domestic destinations: 93.8. 

Year: 2011; 
Dulles to Los Angeles International: 143.2; 
Dulles to all domestic destinations: 90.7. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 25: Indexed Average Annual Airfares for All Dulles Domestic 
Flights and Flights between Dulles and Los Angeles International 
Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed average annual airfare: 

Year: 2000; 
Dulles to Los Angeles International: 100; 
Dulles to all domestic destinations: 100. 

Year: 2001; 
Dulles to Los Angeles International: 96.2; 
Dulles to all domestic destinations: 98.6. 

Year: 2002; 
Dulles to Los Angeles International: 93.4; 
Dulles to all domestic destinations: 94.7. 

Year: 2003; 
Dulles to Los Angeles International: 87.3; 
Dulles to all domestic destinations: 89.5. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
Dulles to Los Angeles International: 68.8; 
Dulles to all domestic destinations: 75.1. 

Year: 2005; 
Dulles to Los Angeles International: 62.8; 
Dulles to all domestic destinations: 68. 

Year: 2006; 
Dulles to Los Angeles International: 74.1; 
Dulles to all domestic destinations: 84.1. 

Year: 2007; 
Dulles to Los Angeles International: 75.7; 
Dulles to all domestic destinations: 85.1. 

Year: 2008; 
Dulles to Los Angeles International: 69.2; 
Dulles to all domestic destinations: 94.9. 

Year: 2009; 
Dulles to Los Angeles International: 59.1; 
Dulles to all domestic destinations: 86.1. 

Year: 2010; 
Dulles to Los Angeles International: 67; 
Dulles to all domestic destinations: 94.1. 

Year: 2011; 
Dulles to Los Angeles International: 77.2; 
Dulles to all domestic destinations: 104. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 26: Indexed Average Annual Passenger Traffic for All Dulles 
Domestic Flights and Flights between Dulles and Phoenix Sky Harbor 
International Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed annual passenger traffic: 

Year: 2000; 
Dulles to Phoenix Sky Harbor International: 100; 
Dulles to all domestic destinations: 100. 

Year: 2001; 
Dulles to Phoenix Sky Harbor International: 89.4; 
Dulles to all domestic destinations: 84.3. 

Year: 2002; 
Dulles to Phoenix Sky Harbor International: 89.3; 
Dulles to all domestic destinations: 79.5. 

Year: 2003; 
Dulles to Phoenix Sky Harbor International: 130.2; 
Dulles to all domestic destinations: 83.8. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
Dulles to Phoenix Sky Harbor International: 153.3; 
Dulles to all domestic destinations: 112.7. 

Year: 2005; 
Dulles to Phoenix Sky Harbor International: 167.5; 
Dulles to all domestic destinations: 131.5. 

Year: 2006; 
Dulles to Phoenix Sky Harbor International: 152.3; 
Dulles to all domestic destinations: 110.1. 

Year: 2007; 
Dulles to Phoenix Sky Harbor International: 160.7; 
Dulles to all domestic destinations: 112.1. 

Year: 2008; 
Dulles to Phoenix Sky Harbor International: 144.4; 
Dulles to all domestic destinations: 102.5. 

Year: 2009; 
Dulles to Phoenix Sky Harbor International: 136.9; 
Dulles to all domestic destinations: 93.4. 

Year: 2010; 
Dulles to Phoenix Sky Harbor International: 127.2; 
Dulles to all domestic destinations: 93.8. 

Year: 2011; 
Dulles to Phoenix Sky Harbor International: 125.8; 
Dulles to all domestic destinations: 90.7. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 27: Indexed Average Annual Airfares for All Dulles Domestic 
Flights and Flights between Dulles and Phoenix Sky Harbor 
International Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed average annual airfare: 

Year: 2000; 
Dulles to Phoenix Sky Harbor International: 100; 
Dulles to all domestic destinations: 100. 

Year: 2001; 
Dulles to Phoenix Sky Harbor International: 85.5; 
Dulles to all domestic destinations: 98.6. 

Year: 2002; 
Dulles to Phoenix Sky Harbor International: 76.5; 
Dulles to all domestic destinations: 94.7. 

Year: 2003; 
Dulles to Phoenix Sky Harbor International: 64.2; 
Dulles to all domestic destinations: 89.5. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
Dulles to Phoenix Sky Harbor International: 58.8; 
Dulles to all domestic destinations: 75.1. 

Year: 2005; 
Dulles to Phoenix Sky Harbor International: 57.3; 
Dulles to all domestic destinations: 68. 

Year: 2006; 
Dulles to Phoenix Sky Harbor International: 68.3; 
Dulles to all domestic destinations: 84.1. 

Year: 2007; 
Dulles to Phoenix Sky Harbor International: 63.5; 
Dulles to all domestic destinations: 85.1. 

Year: 2008; 
Dulles to Phoenix Sky Harbor International: 71.9; 
Dulles to all domestic destinations: 94.9. 

Year: 2009; 
Dulles to Phoenix Sky Harbor International: 60.3; 
Dulles to all domestic destinations: 86.1. 

Year: 2010; 
Dulles to Phoenix Sky Harbor International: 68.8; 
Dulles to all domestic destinations: 94.1. 

Year: 2011; 
Dulles to Phoenix Sky Harbor International: 72.7; 
Dulles to all domestic destinations: 104. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 28: Indexed Average Annual Passenger Traffic for All Dulles 
Domestic Flights and Flights between Dulles and Salt Lake City 
International Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed annual passenger traffic: 

Year: 2000; 
Dulles to Salt Lake City International: 100; 
Dulles to all domestic destinations: 100. 

Year: 2001; 
Dulles to Salt Lake City International: 97.3; 
Dulles to all domestic destinations: 84.3. 

Year: 2002; 
Dulles to Salt Lake City International: 95.1; 
Dulles to all domestic destinations: 79.5. 

Year: 2003; 
Dulles to Salt Lake City International: 66.3; 
Dulles to all domestic destinations: 83.8. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
Dulles to Salt Lake City International: 91.6; 
Dulles to all domestic destinations: 112.7. 

Year: 2005; 
Dulles to Salt Lake City International: 90.1; 
Dulles to all domestic destinations: 131.5. 

Year: 2006; 
Dulles to Salt Lake City International: 93.7; 
Dulles to all domestic destinations: 110.1. 

Year: 2007; 
Dulles to Salt Lake City International: 97; 
Dulles to all domestic destinations: 112.1. 

Year: 2008; 
Dulles to Salt Lake City International: 91.2; 
Dulles to all domestic destinations: 102.5. 

Year: 2009; 
Dulles to Salt Lake City International: 82.3; 
Dulles to all domestic destinations: 93.4. 

Year: 2010; 
Dulles to Salt Lake City International: 78.6; 
Dulles to all domestic destinations: 93.8. 

Year: 2011; 
Dulles to Salt Lake City International: 92.6; 
Dulles to all domestic destinations: 90.7. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 29: Indexed Average Airfares for All Dulles Domestic Flights 
and Flights between Dulles and Salt Lake City International Airport, 
2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed average annual airfare: 

Year: 2000; 
Dulles to Salt Lake City International: 100; 
Dulles to all domestic destinations: 100. 

Year: 2001; 
Dulles to Salt Lake City International: 91; 
Dulles to all domestic destinations: 98.6. 

Year: 2002; 
Dulles to Salt Lake City International: 90.2; 
Dulles to all domestic destinations: 94.7. 

Year: 2003; 
Dulles to Salt Lake City International: 80.7; 
Dulles to all domestic destinations: 89.5. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
Dulles to Salt Lake City International: 73.7; 
Dulles to all domestic destinations: 75.1. 

Year: 2005; 
Dulles to Salt Lake City International: 76.4; 
Dulles to all domestic destinations: 68. 

Year: 2006; 
Dulles to Salt Lake City International: 89.7; 
Dulles to all domestic destinations: 84.1. 

Year: 2007; 
Dulles to Salt Lake City International: 89.8; 
Dulles to all domestic destinations: 85.1. 

Year: 2008; 
Dulles to Salt Lake City International: 92.1; 
Dulles to all domestic destinations: 94.9. 

Year: 2009; 
Dulles to Salt Lake City International: 78.8; 
Dulles to all domestic destinations: 86.1. 

Year: 2010; 
Dulles to Salt Lake City International: 92.4; 
Dulles to all domestic destinations: 94.1. 

Year: 2011; 
Dulles to Salt Lake City International: 97.9; 
Dulles to all domestic destinations: 104. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 30: Indexed Average Annual Passenger Traffic for All Dulles 
Domestic Flights and Flights between Dulles and Seattle-Tacoma 
International Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed annual passenger traffic: 

Year: 2000; 
Dulles to Seattle-Tacoma International: 100; 
Dulles to all domestic destinations: 100. 

Year: 2001; 
Dulles to Seattle-Tacoma International: 103.7; 
Dulles to all domestic destinations: 84.3. 

Year: 2002; 
Dulles to Seattle-Tacoma International: 123; 
Dulles to all domestic destinations: 79.5. 

Year: 2003; 
Dulles to Seattle-Tacoma International: 135.2; 
Dulles to all domestic destinations: 83.8. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
Dulles to Seattle-Tacoma International: 133; 
Dulles to all domestic destinations: 112.7. 

Year: 2005; 
Dulles to Seattle-Tacoma International: 165.9; 
Dulles to all domestic destinations: 131.5. 

Year: 2006; 
Dulles to Seattle-Tacoma International: 130; 
Dulles to all domestic destinations: 110.1. 

Year: 2007; 
Dulles to Seattle-Tacoma International: 118.3; 
Dulles to all domestic destinations: 112.1. 

Year: 2008; 
Dulles to Seattle-Tacoma International: 114; 
Dulles to all domestic destinations: 102.5. 

Year: 2009; 
Dulles to Seattle-Tacoma International: 98.1; 
Dulles to all domestic destinations: 93.4. 

Year: 2010; 
Dulles to Seattle-Tacoma International: 110.2; 
Dulles to all domestic destinations: 93.8. 

Year: 2011; 
Dulles to Seattle-Tacoma International: 112.1; 
Dulles to all domestic destinations: 90.7. 

Source: GAO analysis of DOT data. 

[End of figure] 

Figure 31: Indexed Average Annual Airfares for All Dulles Domestic 
Flights and Flights between Dulles and Seattle-Tacoma International 
Airport, 2000 to 2011: 

[Refer to PDF for image: multiple line graph] 

Indexed average annual airfare: 

Year: 2000; 
Dulles to Seattle-Tacoma International: 100; 
Dulles to all domestic destinations: 100. 

Year: 2001; 
Dulles to Seattle-Tacoma International: 82.9; 
Dulles to all domestic destinations: 98.6. 

Year: 2002; 
Dulles to Seattle-Tacoma International: 67.4; 
Dulles to all domestic destinations: 94.7. 

Year: 2003; 
Dulles to Seattle-Tacoma International: 64.9; 
Dulles to all domestic destinations: 89.5. 

Years that beyond-perimeter nonstop service from Reagan National began: 

Year: 2004; 
Dulles to Seattle-Tacoma International: 57.1; 
Dulles to all domestic destinations: 75.1. 

Year: 2005; 
Dulles to Seattle-Tacoma International: 49.7; 
Dulles to all domestic destinations: 68. 

Year: 2006; 
Dulles to Seattle-Tacoma International: 63.6; 
Dulles to all domestic destinations: 84.1. 

Year: 2007; 
Dulles to Seattle-Tacoma International: 70.3; 
Dulles to all domestic destinations: 85.1. 

Year: 2008; 
Dulles to Seattle-Tacoma International: 78.3; 
Dulles to all domestic destinations: 94.9. 

Year: 2009; 
Dulles to Seattle-Tacoma International: 70.8; 
Dulles to all domestic destinations: 86.1. 

Year: 2010; 
Dulles to Seattle-Tacoma International: 71.9; 
Dulles to all domestic destinations: 94.1. 

Year: 2011; 
Dulles to Seattle-Tacoma International: 75.2; 
Dulles to all domestic destinations: 104. 

Source: GAO analysis of DOT data. 

[End of figure] 

[End of section] 

Appendix V: Logistic Regression Analysis of Slot-Controlled Airports 
and Aircraft Size: 

The regression analysis explained in this appendix is designed to 
assess whether airlines tend to use smaller aircraft on flights to or 
from slot-controlled airports. The analysis is based on data for all 
scheduled passenger airline flights between large hub domestic 
airports for two different Thursdays (one in winter and one in summer) 
in 2011, and assesses whether and how several factors--including 
whether the flight is scheduled to arrive or depart a slot-controlled 
airport--are correlated with the use of smaller aircraft. For the base-
case analysis we defined a smaller aircraft as ones with 100 seats or 
fewer. Specifically, this appendix discusses (1) the model hypothesis, 
(2) the conceptual framework of the model, (3) data source and 
variable definitions, and (4) base-case model results and sensitivity 
analyses. 

Model Hypothesis: 

As discussed in the report, a variety of parties--airlines, the Port 
Authority of New York and New Jersey, and Department of Justice--
assert that airlines currently operating out of slot-controlled 
airports use some of their slots in ways to keep out their 
competitors. One of these ways is using smaller aircraft, on average, 
at the four slot-controlled airports in an effort to meet the 80 
percent usage rule. 

Conceptual Framework of Model: 

As discussed in our report, we examined the number and proportion of 
scheduled passenger flights using smaller aircraft departing or 
arriving slot-controlled airports (which includes four airports) and 
the remaining 24 large hub airports.[Footnote 120] In comparing 
flights arriving and departing the slot-controlled airports with other 
large hub airports that are not slot-controlled, we found that the 
four slot-controlled airports had a higher proportion of scheduled 
flights with smaller aircraft than flights to or from the remaining 24 
large hub airports. We found that these differences are statistically 
significant. 

Many factors may contribute to an airline's decision to use smaller 
aircraft, such as location and proximity to other major markets, 
restrictions on distance flown, the type of passengers being served, 
and the airline's route structure (e.g., a hub-and-spoke structure 
verses point-to-point). For example, all four of the slot-controlled 
airports are on the Eastern Seaboard of the United States with many 
destinations--large and small--within reasonably close proximity. 
Because shorter distance flights are generally served by smaller 
aircraft, flights to and from the slot-controlled airports may have a 
higher proportion of flights with small aircraft. Also, LaGuardia and 
Reagan National are subject to perimeter rules of 1,500 and 1,250 
miles, respectively, that limits the distance of flights from these 
airports. A restriction on flight distance such as this would likely 
skew aircraft use toward smaller sized craft. Whether an airport being 
served is a business versus leisure (tourist) market may also affect 
the size of aircraft--for example, flights serving leisure markets may 
tend to use larger aircraft less frequently than a business market. 
And finally, an airline's route structure could influence the distance 
of flights or aircraft size--for example, an airport that serves as a 
hub for an airline will require more short distance flights than a 
point-to-point business model. 

Since a variety of factors in addition to slot controls may be 
correlated with the use of a small aircraft, we developed a logistic 
regression model that controls for other factors that may be 
correlated with aircraft size. To isolate the correlation between 
flights arriving or departing slot-controlled airports and aircraft 
size, we defined aircraft as small if its capacity was 100 seats or 
fewer.[Footnote 121] We applied a logistic regression technique (or 
logit model) in which the scheduled flights are defined as using small 
aircraft (100 seats or fewer) or large (more than 100 seats), and 
assessed how each of a set of independent factors (including whether 
the flights arrives or departs a slot-controlled airport) correlates 
with the odds of a small aircraft used on that flight. All factors 
related to aircraft size may not be fully controlled for by this 
model. Also, as with any regression model, this analysis does not 
prove a causal relationship between aircraft size and slot-controlled 
airport, only the correlation between the two. 

Data Source and Variables: 

The primary data source for the model is airlines' schedule data from 
Innovata, which provides information on all airlines scheduled 
flights. The level of observation for this analysis is each 
individually scheduled passenger flight. We used all flights between 
the 28 large hub airports[Footnote 122] on two Thursdays in 2011--
February 10, 2011, and August 11, 2011--for a total of 13,901 flights. 
Thursdays are generally considered to be a high-demand day, and 
February and August are representative months for the winter and 
summer seasons, respectively. The schedule data provide relevant 
information for each flight, including the size of aircraft, the date 
and time of the scheduled flight, the origin and destination airport, 
and the marketing and operating airline. 

Dependent Variable: 

The dependent variable for the analysis is a dummy (or indicator) 
variable--that is, a variable that takes a value of one or zero 
depending on the presence or absence of some characteristic. In this 
case, the dependent variable takes the value of one if the scheduled 
flight uses a small aircraft size (100 or fewer seats) and the value 
of zero if the flight uses a large aircraft (greater than 100 seats). 

Independent Variables[Footnote 123] 

Slot-controlled airport (variable of interest): A dummy variable that 
takes the value of one if either the origin or destination of the 
flight is a slot-controlled airport. We used several different slot-
controlled airport dummy variables, including one for all four slot-
controlled airports as a group (slot4), one for only the three New 
York City area slot-controlled airports (slot3) and one for each 
individual slot-controlled airport alone. 

Legacy airline: A dummy variable that takes the value of one if the 
flight is marketed by one of the legacy airlines we defined (Delta Air 
Lines, United Airlines, American Airlines, US Airways, and Continental 
Airlines) and takes the value of zero for all other marketing 
airlines. Airlines vary in their fleet mix. Some airlines--either on 
their own or through partnerships with other airlines--operate a 
varied fleet mix with both large and small aircraft, while other 
airlines tend to fly only a few aircraft types that may have little 
variation in the size of aircraft. We expect that when the marketing 
airline is a legacy airline, all else equal, there is a greater 
propensity to use smaller aircraft because these airlines and their 
partners tend to deploy a wide range of aircraft size, including many 
commuter-sized aircraft, across a broad range of types of routes. 

Flight distance: A categorical variable that is derived from distance 
quartiles of the flights analyzed. The four distance categories are 
less than 325 miles, 325 to 602 miles, 603 to 998 miles, and greater 
than 998 miles. Flight distance is a key factor in the decision 
underlying the assignment of aircraft to flights. We used the flights 
that fell into the second quartile (325 miles to 602 miles in 
distance) as the reference category that the other flight distance 
dummy variables are compared to. We expect that shorter flights would 
tend to use smaller aircraft. 

Flight frequency for an airline route: A categorical variable 
indicating the importance of a particular route to an airline's 
operations. We define flight frequency on an airline's route as the 
total number of flights operated by the same airline on a given day 
from the same origin to the same destination. Few frequencies on an 
airline's route indicate that the route may not be highly connected to 
the airline's network, while numerous frequencies indicate a greater 
degree of connection, possibly involving one of the airline's hub 
airports.[Footnote 124] We divided the number of flights on an 
airline's route into quartiles and used the two lower quartiles (which 
together included all airlines' routes with fewer than 6 flights per 
day) as reference categories that the remaining two quartiles are 
compared to. The third quartile includes airlines' routes with 6 to 8 
flights and day and the fourth quartile includes routes with 9 or more 
flights per day. We expect that greater dedication to serving a route 
(higher flight frequency) will be correlated with reduced odds of 
using a small aircraft. 

Tourism: A dummy variable that takes the value of one if either the 
origin or destination of a flight is one of three cities that have 
substantial tourist travel (Las Vegas, Nevada; Orlando, Florida; and 
Fort Lauderdale, Florida) based on hotel revenues relative to 
population and our judgment about which cities have substantial 
tourist travel. We defined Las Vegas McCarran International, Orlando 
International, and Fort Lauderdale-Hollywood International airports as 
the three tourism-oriented airports in the analysis. We expect that 
smaller aircraft will be less likely to be used on flights to and from 
these airports. 

Base-Case Model Results and Sensitivity Analysis: 

Table 7 provides results of our base-case model that defines a small 
aircraft as one with 100 seats or fewer. The results are expressed as 
odds ratios, which represents the odds that a flight uses a small 
aircraft (100 seats or fewer) divided by the odds that a flight uses a 
large aircraft (more than 100 seats). The odds ratio for the variable 
of interest (slot4) is greater than 1, indicating that a flight to or 
from any of the four slot-controlled airports is more likely to use a 
small aircraft than a flight to or from the other 24 large hub 
airports that are not slot-controlled.[Footnote 125] Specifically, the 
odds that a flight to or from a slot-controlled airport uses a smaller 
aircraft is 75 percent higher than the odds for a flight to and from 
the other 24 large hub airports that are not slot-controlled. This 
result and the odds ratios for all other variable in the base-case 
scenario are statistically significant. 

Table 7: Logistic Regression Results for Slot-Controlled-Airport and 
Aircraft-Size Model, Small Aircraft with 100 Seats or Fewer: 

Variable: To or from any of the four slot-controlled airports; 
Odds ratio[A]: 1.75. 

Variable: To or from tourism airport; 
Odds ratio[A]: 0.16. 

Variable: Marketed by a legacy airline; 
Odds ratio[A]: 8.71. 

Variable: 6 to 8 flights per day by same airline from same origin to 
same destination; 
Odds ratio[A]: 0.32. 

Variable: 9 or more flights per day by same airline from same origin 
to same destination; 
Odds ratio[A]: 0.11. 

Variable: Flight distance less than 325 miles; 
Odds ratio[A]: 3.99. 

Variable: Flight distance between 603 and 998 miles; 
Odds ratio[A]: 0.40. 

Variable: Flight distance more than 998 miles; 
Odds ratio[A]: 0.06. 

Source: GAO analysis of airline schedule data: 

[A] All odds ratios are significant at the p-value <0.01 (1 percent 
level). The significance of the coefficients in the models was 
evaluated using a simple Wald test statistic, which is asymptotically 
equivalent to the likelihood-ratio chi-square statistic. The 
percentage of flights correctly predicted by the model to be on small 
versus larger aircraft was 85-percent. The measure is known as the 
concordance rate. 

[End of table] 

In addition to the model discussed above, we also ran with the model 
with alternative definitions of the slot-controlled-airport dummy 
variable. Table 8 shows the odds ratios from these 5 addition model 
runs for the variously defined slot-controlled-airport variable. The 
results for the independent variables in these model runs were 
reasonably stable both in the direction and magnitude of the odds 
ratios. 

Table 8: Logistic Regression Results for Alternative Slot-Controlled-
Airport Variable Definitions, Small Aircraft with 100 Seats or Fewer: 

Slot-controlled-airport variable: To or from any of the three New York 
City area slot-controlled airports; 
Odds Ratio: 1.68[A]. 

Slot-controlled-airport variable: To or from LaGuardia; 
Odds Ratio: 2.08[A]. 

Slot-controlled-airport variable: To or from JFK; 
Odds Ratio: 1.63[A]. 

Slot-controlled-airport variable: To or from Newark; 
Odds Ratio: 1.22[B]. 

Slot-controlled-airport variable: To or from Reagan National; 
Odds Ratio: 1.72[A]. 

Source: GAO analysis of airline schedule data: 

[A] Indicates odds ratio is significant at a p-value > 0.01. 

[B] Indicates odds ratio is significant at a p-value < 0.1. 

[End of table] 

We also conducted sensitivity analyses by testing two alternative 
definitions for small aircraft. We ran the same models described 
above, but defined a small aircraft as (1) aircraft with 124 seats or 
fewer (which is the median aircraft size for this data set) and (2) 
aircraft with 80 seats or fewer (which excludes the largest regional 
jets). Tables 9 and 10 show the results of these model runs, including 
the results for each of the six different slot-controlled airport 
dummy variable definitions. All other independent variables included 
in the models were robust--both in terms of the direction, magnitude, 
and statistical significance of odds ratios--across the three 
definitions for small aircraft. 

In addition, the odds ratios for all definitions of the slot-
controlled-airport dummy variable are greater than 1--indicating a 
greater odds of a flight using a small aircraft to or from the slot-
controlled airport, however the slot variable was defined. The 
magnitude of the odds ratio, however, varies based on the definition 
of a small aircraft (that is, a cutoff of 80, 100, or 124 seats). 
Also, the degree of the statistical significance of the odds ratios 
for Newark and JFK vary. The odds ratio for Newark becomes more 
significant under the alternative aircraft definitions (i.e., a cutoff 
of 80 or 124 seats). And, while odds ratio for the JFK dummy variable 
was significant in both the base case (100-seat cutoff) and the 124-
seat cutoff, the odds ratio for JFK is not statistically significant 
in the 80 seat cutoff. 

Table 9: Logistic Regression Results for Alternative Slot-Controlled-
Airport Variable Definitions, Small Aircraft with 124 Seats or Fewer: 

Slot-controlled airport variable: To or from any of the four slot-
controlled airports; 
Odds Ratio: 2.49[A]. 

Slot-controlled airport variable: To or from any of the three New York 
City area slot-controlled airports; 
Odds Ratio: 2.18[A]. 

Slot-controlled airport variable: To or from LaGuardia; 
Odds Ratio: 3.68[A]. 

Slot-controlled airport variable: To or from JFK; 
Odds Ratio: 1.53[A]. 

Slot-controlled airport variable: To or from Newark; 
Odds Ratio: 1.48[A]. 

Slot-controlled airport variable: To or from Reagan National; 
Odds Ratio: 4.29[A]. 

Source: GAO analysis of airline schedule data: 

[A] Indicates odds ratio is significant at p-value < 0.01. 

[End of table] 

Table 10: Logistic Regression Results for Alternative Slot-Controlled-
Airport Variable Definitions, Small Aircraft with 80 Seats or Fewer: 

Slot-controlled airport variable: To or from any of the four slot-
controlled airports; 
Odds Ratio: 1.55[A]. 

Slot-controlled airport variable: To or from any of the three New York 
City area slot-controlled airports; 
Odds Ratio: 1.61[A]. 

Slot-controlled airport variable: To or from LaGuardia; 
Odds Ratio: 2.17[A]. 

Slot-controlled airport variable: To or from JFK; 
Odds Ratio: 1.22. 

Slot-controlled airport variable: To or from Newark; 
Odds Ratio: 1.26[B]. 

Slot-controlled airport variable: To or from Reagan National; 
Odds Ratio: 1.41[A]. 

Source: GAO analysis of airline schedule data: 

[A] Indicates odds ratio is significant at p-value < 0.01. 

[B] Indicates odds ratio is significant at p-value < 0.05. 

[End of table] 

[End of section] 

Appendix VI: Comments from the Metropolitan Washington Airports 
Authority: 

Metropolitan Washington	Airports	Authority: 
1 Aviation Circle: 
Washington, DC 20001-6000: 
[hyperlink, http://www.mwaa.com] 

August 31, 2012: 

Ms. Susan A. Fleming:	
Director:	
Physical Infrastructure:	
U.S. Government Accountability Office:	
441 G Street, N.W.	
Washington, DC 20548:	 

Dear Ms. Fleming:	 
On behalf of the Metropolitan Washington Airports Authority (Airports 
Authority), thank	you for the opportunity to comment on the September 
2012 report entitled "Slot-Controlled	Airports, FAA's Rules Could be 
Improved to Enhance Capacity and Competition." We appreciate the time 
dedicated by the Government Accountability Office (GAO) team in 
studying	the impacts of the additional 16 new beyond-perimeter flights 
authorized under the FAA	Modernization and Reform Act of 2012, Public 
Law 112-95, on both Ronald Reagan	Washington National (Reagan 
National) and Washington Dulles International (Dulles	International) 
Airports. We concur with the five GAO recommendations to improve the 
Federal	Aviation Administration's (FAA) oversight of slot utilization. 
However, we do have several	significant concerns with the report 
content specific to Reagan National and Dulles International	
Airports.	 

We strongly disagree with the report's conclusions stating the 
additional beyond-perimeter flights are "likely to have a limited 
effect on the Washington, DC Airports" and can be	supported by 
"sufficient terminal capacity" at Reagan National. In addition, we are 
greatly	concerned about the assertion that the new beyond-perimeter 
flights effect on Dulles	International will be insignificant. The 
issues considered in the report are complex and must be	viewed in a 
broader context to form a complete and accurate understanding of the 
situation.	 

As the report acknowledges, the analytics related to the new flight 
activity are limited	since the flights have just begun, with some 
being inaugurated as recently as August 2012. To	ensure accuracy, an 
analysis must be based on a longer observation period and, most	
importantly, consider broader changes underway in Reagan National's 
flight activity resulting	from legacy carrier mergers, the Delta-U.S. 
Airways slot swap transaction, and other recent	commercial slot 
transactions.	 

As the operator of both Reagan National and Dulles International, we 
can attest that the cumulative result of the legislative mandate and 
commercial transactions is significant. Key impacts include: 

* A considerable change in the operating character of Reagan National; 

*	The need for extensive facility modifications at Reagan National, 
requiring major long term capital investment; and; 

* A shift of flights from Dulles International to Reagan National, 
which is increasing costs for Dulles. 

In 2012, as a result of the combination of legislative and commercial 
changes, the airlines' utilization of Reagan National facilities has 
increased dramatically, vastly challenging the Terminal facilities.	
Specifically: 

* A large concentration of slot allocations has enabled one major 
airline to essentially create an East Coast hub operation at Reagan 
National, requiring significant passenger transfers to other 
unconnected gates, inconveniencing passengers and further stressing 
security checkpoints; 

* Airline mergers create passenger congestion when merged carriers 
accommodate passengers in consolidated space, and increase the number 
of aircraft turns per gate; and; 

* Air carriers with limited slot allocations also are turning to 
larger aircraft, bringing more passengers. New low cost flights have 
almost doubled in the last two years. 

These cumulative changes have had a negative impact on the customer 
experience, resulting in: 

* Congested passenger screening checkpoints. Although the "TSA mode] 
suggested that the impact of the new beyond-perimeter flights on 
passenger security screening wait times would be minimal," recent wait 
times at the South Pier security checkpoint have consistently exceeded 
30 minutes. Further, the newly established hubbing operation has 
exacerbated customer inconvenience and wait times by forcing many 
passengers to exit and re-enter security to reach their connecting 
flights; 

* Limited vehicle parking availability. More passengers flying means 
more people parking, with DCA's economy lot filling to capacity more 
than 60 times during the first eight months of 2012, more than double 
the number of times the lot was forced to close in 2011; 

* No excess gate capacity. Currently, there are no vacant gates at 
Reagan National, and additional flights will push the limits on gate 
utilization. As the report points out, in September 2012, when the new 
beyond-perimeter flights are operating, Reagan National's gates will 
average 9.9 turns a day, while six to eight turns per gate is defined 
as full gate utilization in a recent Transportation Research Board 
study. 

We wholeheartedly agree with the GAO's observations that "the terminal 
has more limited capacity" than the airfield, with the new slot 
exemption flights airline "gates will be fully used," and "exceeding 
full gate utilization could lead to flight delays." 

The changes in slot allocations and new authorization of more beyond-
perimeter flights have generated the need for facility upgrades at 
Reagan National. Passengers bear the brunt of squeezing more flights 
into Reagan, given that the legislative and regulatory framework has 
not provided the airport operator sufficient time or additional 
resources to upgrade facilities. 

The Airports Authority has initiated a short-term capital investment 
plan of approximately $45 million for physical facility improvements 
to Reagan National to address the cumulative effects of the 
regulatory, legislative and commercial changes. Improvements include 
an expansion to security screening areas, replacement of aircraft 
boarding bridges, and construction of additional baggage handling 
systems, scheduled for completion by May 2013. We regret there will be 
passenger inconvenience in the interim. Recognizing that operational 
changes continue to evolve, a larger, long-term capital investment 
effort is also under evaluation. 

We appreciate that the GAO report considers the impact of the new 
beyond-perimeter flights at Reagan National on Dulles International; 
however, we disagree with the characterization of the impact as 
"insignificant" on Dulles International's passenger volumes and
"relatively small" on the operating cost structure. Airlines receiving 
new slots and/or beyond-perimeter flight allocations at Reagan 
National have shifted similar service away from Dulles International, 
escalating that airport's costs and, therefore expenses to airlines. 

We disagree with the GAO conclusion that the potential passenger 
erosion on Dulles International from the beyond-perimeter flights at 
Reagan National would be less than the growth expected at these 
airports over the next two or three years. Further, we challenge the 
assertion that the changes in potential airline cost per enplaned 
passenger estimated by GAO to be a potential cost increase of $1.10 
(3.9 percent) in 2013 and $1.51 (5.7 percent) in 2014 are "relatively 
small," when placed in proper context. Airport costs are a major 
factor in airline decisions to schedule airport service. The 
difference between the cost structure at Reagan National and Dulles 
International is already substantial, $12.74 and $26.03 in 2012 
respectively, and Dulles International costs are already high as 
compared with many peer airports. The 2013 estimated cost per enplaned 
passenger for Thurgood Marshall Baltimore Washington International 
Airport (BWI) is $9.08, one-third of the anticipated rate for Dulles 
International in 2013. New beyond-perimeter flights at Reagan National 
have already led to corresponding Dulles flight reductions, increasing 
the potential airline cost structure differential between our two 
airports and BWI. The negative impact of Reagan National beyond-
perimeter flights on Dulles International is a continuing, valid 
concern with far-reaching consequences for the traveling public.
In administering the slot allocation process, we encourage USDOT to 
embrace GAO's recommendations enabling better management of available 
airport capacity and providing for a more transparent process. Also, 
we urge Congress to carefully consider the substantial consequences of 
additional slot and/or perimeter mandates. 

It is imperative that the safety, convenience and satisfaction of the 
traveling public be a hallmark of Washington, D.C.'s major airports. 
Assuring that airport facilities are adequate to accommodate changes 
in passenger traffic levels is vital to achieving and sustaining that 
goal. 

We appreciate the GAO's interest in and recommendations for optimizing 
the utilization of slot-controlled airports in a way that also 
safeguards their efficiency and quality of service for the millions of 
people who depend on them. 

Sincerely, 

Signed by: 

John E. Potter: 
President and Chief Executive Officer: 

JEP:bb: 

[End of section] 

Appendix VII: Comments from the Port Authority of New York and New 
Jersey: 

The Port Authority of NY & NJ: 
Susan M. Baer: 
Director: 
225 Park Avenue South: 
New York NY 10003: 
T: 212-435-3720: 
F: 212-435-3833: 

August 31, 2012:	 

Ms. Susan S. Fleming: 
Government Accountability Office: 
441 G Street, NW: 
Washington, DC 20548: 

Dear Ms Fleming: 

The Port Authority of New York & New Jersey appreciates the 
opportunity to review and "Slot-Controlled comment on the Government 
Accountability Office report	Airports: FAA's Rule Could Be Improve to 
Enhance Capacity and Competition", dated September 2012. The
Senate Committee of Commerce, Science and Technology asked that you 
review how well slot control rules are working to reduce congestion, 
while maximizing capacity and encouraging competition. 

The GAO's analysis was sound, your research thorough, and your 
conclusions reasonable. In addition, we concur with your recommended 
actions. We believe that if there were improvements to the reporting 
requirements, a regular review of the usage rates, an application of 
the usage rate to match individual slots and flights, periodic 
disclosure of slot information including ownership, as well as a 
limitation to the leasing of slots for carriers who have ceased 
operations, both competition and transparency would be enhanced. 

The Port Authority also believes that the GAO's approach to assess not 
only airside capacity but also terminal and landside capacity when 
reviewing changes in slot rules is appropriate. While each airport 
faces a unique set of circumstances, it is critical to consider all 
impacts on an airport's operational capacity. 

Thank for you for your efforts in this study which is of vital 
importance to our slot-controlled airports. 

Sincerely, 

Signed by: 

Susan M. Baer: 
Director: 
Aviation Department: 

[End of section] 

Appendix VIII: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Susan Fleming (202) 512-2834 or flemings@gao.gov: 

Staff Acknowledgments: 

In addition to the individual named above, Amy Abramowitz, Paul 
Aussendorf, Geoff Hamilton, Bob Homan, David Hooper, Delwen Jones, 
Kirsten Lauber, Josh Ormond, Dae Park, and Gretchen Snoey made 
significant contributions to this report. 

[End of section] 

Footnotes: 

[1] FAA regulations at 14 C.F.R. Part 93, subparts K and S applicable 
to Reagan National Airport use the term "slots," whereas FAA orders 
applicable to JFK, LaGuardia, and Newark use the term "operating 
authorization." For the purposes of this report we refer to both as 
slots. 

[2] FAA Modernization and Reform Act of 2012, Pub. L. No. 112-95, § 
414, 126 Stat. 11 (2012). 

[3] GAO, Reagan National Airport: Capacity to Handle Additional 
Flights and Impact on Other Airports, [hyperlink, 
http://www.gao.gov/products/GAO/RCED-99-234] (Washington, D.C.: Sept. 
17, 1999) and Reagan National Airport: Update on Capacity to Handle 
Flights and Impact on Other Airports, [hyperlink, 
http://www.gao.gov/products/GAO-07-352] (Washington, D.C.: Feb. 28, 
2007). 

[4] 74 Fed. Reg. 52132 (Oct. 9, 2009); 74 Fed. Reg. 52134 (Oct. 9, 
2009). The federal court ruling was an order by the United States 
Court of Appeals for the District of Columbia Circuit. Port Authority 
of New York and New Jersey v. Federal Aviation Administration, Court 
of Appeals for the District of Columbia, Order No. 08-1329 (Dec. 8, 
2008). 

[5] Federal law defines large hub airports as those commercial service 
airports that have at least 1 percent of the passenger boardings. 49 
U.S.C. § 40102(29). 

[6] BTS defines these airports as those within the continental United 
States that enplaned 1 percent or more of the domestic scheduled-
service passengers as of June 2010. Federal law defines large hub 
airports as those commercial service airports that have at least 1 
percent of the passenger boardings. 49 U.S.C. § 40102(29). 

[7] The data indicated that the cancellation rate at LaGuardia was 
generally twice the system-wide average during this period. See also 
GAO, National Airspace System: DOT and FAA Actions Will Likely Have a 
Limited Effect on Reducing Delays during Summer 2008 Travel Season, 
[hyperlink, http://www.gao.gov/products/GAO-08-934T] (Washington, 
D.C.: July 15, 2008). 

[8] In 1998, Washington National Airport was renamed Ronald Reagan 
Washington National Airport. 

[9] In 2009, FAA reduced the operating limits at LaGuardia to 71 
scheduled operations per hour to improve operational efficiency. The 
current slot allocations were kept, but any slots returned to FAA, 
withdrawn for non-use, or unallocated during each affected hour would 
be retired until the number of slots in that hour reaches 71. 

[10] Slots are subject to FAA withdrawal, for example, if a slot is 
not used at least 80 percent of the time over the applicable time 
period. In addition, slots are subject to FAA withdrawal at any time 
to meet operational needs such as reduced airport capacity. 

[11] Although airlines consider slots to be valuable assets, FAA slot 
regulations at 14 C.F.R. § 93.223(a), for example, provide that slots 
do not represent a property right but represent an operating privilege 
subject to absolute FAA control. The FAA slot regulations applicable 
to Reagan National also provide, in general, that slots may be bought, 
sold, leased, or traded for slots at other slot controlled airports. 
14 C.F.R. § 93.221(a). 

[12] Under FAA's temporary order applicable to LaGuardia, slots are 
not allocated on Saturdays. 

[13] The summer season runs from the fourth Sunday in March to the 
fourth Saturday in October. The winter season runs from the fourth 
Sunday in October to the fourth Saturday in March. 

[14] See, e.g., 73 Fed. Reg. 3510, 3513-14 (Jan. 18, 2008). In 
comparison to the temporary FAA orders in place at the New York City 
area airports, the FAA High Density Rule regulations applicable to 
slots at Reagan National provide, in part, that except as otherwise 
provided, slots may be bought, sold, or leased. 14 C.F.R. § 93.221. 
The major exception to this regulation at Reagan National is that slot 
exemptions may not be bought, sold, leased, or otherwise transferred, 
except through an air carrier merger or acquisition. 49 U.S.C. 
41714(j). 

[15] Pub. L. No. 111-8, Division I, Title I, §115, 123 Stat. 524, 921 
(2009). The Omnibus Appropriations Act, 2009 contained a provision 
prohibiting the Secretary of Transportation from using such fiscal 
year 2009 appropriations to promulgate regulations or take any action 
regarding the scheduling of airline operations at any commercial 
airport in the U.S. if such regulation or action involved, among other 
things, auctioning or rights or permission to conduct airline 
operations, the implementation of peak-period pricing or other forms 
of congestion pricing, withdrawing a right or permission to conduct 
operations at such an airport, or requiring a carrier to transfer 
involuntarily any such right or permission to another. 

[16] From 1986 to 2006, when FAA managed congestion at JFK and 
LaGuardia under the High Density Rule, airlines were allowed to buy 
and sell slots at these airports. However, in comments to FAA on a 
proposed congestion management rule for LaGuardia, some airlines 
indicated that a secondary market did not develop because the Wendell 
H. Ford Aviation Investment and Reform Act for the 21ST Century (AIR-
21) granted exemptions from the High Density Rule's flight 
restrictions to some airlines for free. 

[17] The perimeter rule for LaGuardia provides an exception for 
nonstop flights to and from Denver because there was existing service 
to Denver when the rule went into effect. 

[18] Pub. L. No. 99-500, 100 Stat. 1783, 1783-375 (1986); Pub. L. No. 
99-591, 100 Stat. 3341, 3341-376 (1986). 

[19] Pub. L. No. 106-181, 114 Stat. 61 (2000). 

[20] Pub. L. No. 108-176, 117 Stat. 2490 (2003). 

[21] The statutes also authorized 20 additional slot exemptions within 
the 1,250-mile perimeter. 

[22] Pub. L. No. 112-95, 126 Stat. 11 (2012). 

[23] MITRE, an FAA contractor, conducted this analysis in August 2011. 
For information about how MITRE analyzes airport capacity, see 
Appendix V of GAO, National Airspace System: Setting On-Time 
Performance Targets at Congested Airports Could Help Focus FAA's 
Actions, [hyperlink, http://www.gao.gov/products/GAO-10-542] 
(Washington, D.C.: May 26, 2010). 

[24] Based on an FAA analysis of unscheduled operations from May 
through August 2011 indicating that there was an average of 17.3 daily 
general aviation operations weekdays from 6:00 a.m. to 10:59 p.m. We 
reported in 2007 that there were about 200 general aviation and 
unscheduled flights at Reagan National in 2006, or an average of one-
half of a flight operation per day. The number of general aviation and 
unscheduled flights has increased at Reagan National since 2006 in 
part because TSA updated security procedures that made more general 
aviation flights possible, for example, by expanding the number of 
airports from which flights can emanate. 

[25] From 4 p.m. to 4:59 p.m., the number of slot allocations will 
increase from 52 to 54, and from 5 p.m. to 5:59 p.m. and from 6 p.m. 
to 6:59 p.m., the number of slot allocations will increase from 51 to 
53. 

[26] Based on an FAA analysis of general aviation and unscheduled 
weekday operations from May through August 2011. 

[27] Three slots each were available at 6:00 a.m. and 10:00 p.m. and 
40 were available at 11:00 p.m. These numbers exclude other slots that 
are allocated on an ad hoc day-of basis following a request from the 
operator and one commuter slot that is available at 9:00 p.m. and 
another at 10:00 p.m. that are allocated on a temporary basis and 
subject to recall by FAA. 

[28] The official said that although these airlines need the same type 
of space to function, e.g., ticket counters, gates, and baggage 
systems, each airline needs a different amount of space, so economies 
of scale cannot always be maximized. 

[29] Transportation Research Board of the National Academies, 
Reference Guide on Understanding Common Use at Airports, (Washington, 
D.C.: 2010). 

[30] We asked TSA to assess the impact of the new beyond-perimeter 
flights on wait times using its security screening throughput model. 
As inputs to the model, we provided TSA with the flight times for the 
new beyond-perimeter flights, data on the maximum number of passengers 
on those flights, and the screening checkpoints that the passengers 
would use. Although the results from this model suggested that any 
increase in wait times at Reagan National would be minimal, we are not 
reporting the precise estimates of wait time changes because they 
would imply a greater level of precision than the model could 
reasonably provide. 

[31] National Capital Region Transportation Planning Board and 
Metropolitan Washington Council of Governments, Draft 2011 Washington-
Baltimore Regional Air Passenger Survey, (Washington, D.C.: May 2011). 

[32] In calculating the maximum number of enplanements, we included 
the eight new daily beyond-perimeter departures and assumed that each 
daily flight used the aircraft specified in the airline's application 
for the slot exemption and that those aircraft were 100 percent full. 
We did not include the passenger impact of the within-perimeter 
flights that were converted to beyond-perimeter slot exemptions 
because there were too many unknown factors, such as whether the 
passengers on those flights were connecting or originating at Reagan 
National or the load factors on them. 

[33] In 1981, FAA adopted rules to implement FAA's Metropolitan 
Washington Airports' policy (45 Fed. Reg. 62398 (Sept. 18, 1980)) to 
guide the future operations and development of Reagan National and 
Dulles. This implementing Metropolitan Washington Airport rule 
provided, among other things, that the perimeter rule would maintain 
the long-haul nonstop service at Dulles and be consistent with the 
roles proposed for Reagan National as a short/medium-haul facility and 
for Dulles as an unrestricted facility available for all types of 
operations. 48 Fed. Reg. 58036 (Nov. 27, 1981). In 1986, the federal 
law creating MWAA provided that the regulations of MWAA's predecessor 
agency shall become the regulations of MWAA. Pub. L. No. 99-500, 100 
Stat. 1783, 1783-375 (1986); Pub. L. No. 99-591, 100 Stat. 3341, 3341-
376 (1986). 

[34] The 2005 example involved Frontier Airlines and the 2012 example 
involved Delta Air Lines. 

[35] Cost per enplaned passenger is defined as all landing fees, 
airside usage charges, fuel flowage fees, terminal rents, and other 
terminal payments to an airport, divided by the number of enplaned 
passengers. We did not assess the possible impact of the new beyond-
perimeter flights on the cost per enplaned passenger at BWI because of 
differences in how airport authorities calculate those numbers. 
Airlines use cost per enplaned passenger as a standardized measure of 
relative unit costs to compare costs among airports. 

[36] For comparison purposes, MWAA provided data showing that the 
costs per enplaned passenger was substantially higher at Dulles than 
at most other large hub airports. However, these data were not 
directly comparable because airports vary in terms of what airlines 
and airports pay for, which affects the costs per enplanement. 

[37] Federal Aviation Administration, Terminal Area Forecast Summary, 
Fiscal Years 2011-2040. 

[38] According to Moody's Investors Service, Inc., MWAA is among five 
U.S. airport authorities with the most debt. In 2011, MWAA incurred 
$222 million in interest expense. 

[39] The automated passenger train system at Dulles, called Aerotrain, 
is separate from the project to extend Metrorail to Dulles. MWAA 
aviation funds are responsible for 4.1 percent of the total cost of 
the Metrorail extension to Dulles. However, according to MWAA, all 
bonds for the corridor project are backed by a separate MWAA toll road 
credit that is firewalled from the MWAA's aviation credit. 

[40] According to an MWAA official, debt is not issued on an airport-
by-airport basis; but rather as airport-system revenue-bond debt for 
both airports. However, MWAA tracks where the debt proceeds are 
applied by airport. 

[41] MWAA receives revenues from landing fees, which are based on 
aircraft weight; airport leases with airlines; and concessions. 
Although non-aeronautical revenues, such as concessions, are not 
maintained separately by airport, MWAA officials said revenues are not 
sufficient to cover much debt. 

[42] Pub. L. No. 112-95, 126 Stat. 11, 92 (2012). 

[43] FAA supports airports' efforts to mitigate aviation noise mainly 
through its voluntary noise compatibility program, known as the Part 
150 Noise Compatibility Program, which provides guidance to airports 
on how to develop noise compatibility plans to mitigate noise on and 
around airports. MWAA last conducted a noise compatibility study on 
Reagan National in 2004. See also the forthcoming GAO report, Airport 
Noise Grants: FAA Needs to Better Ensure Project Eligibility and 
Improve Strategic Goal and Performance Measures, [hyperlink, 
http://www.gao.gov/products/GAO-12-890]. 

[44] Slot controls are one type of demand management measure used to 
help manage congestion. Other demand management measures include 
congestion pricing and slot auctions. 

[45] Wendell H. Ford Aviation Investment and Reform Act for the 21ST 
Century (AIR-21), Pub. L. No. 106-181 (2000). AIR-21 mandated that the 
High Density Rule slot controls would no longer apply to JFK and 
LaGuardia after January 2007. The exemptions for new entrant airlines 
and for service to small communities using regional jets at JFK and 
LaGuardia were interim measures until the AIR-21 slot related phase-
out became effective. 

[46] In announcing its intent to limit the number of slot exemptions 
allowed to operate at LaGuardia, FAA noted language in section 231 of 
AIR-21 providing, in general, that AIR-21's slot phase out provisions 
shall not be construed to affect FAA's authority for safety and the 
movement of air traffic. 65 Fed. Reg. 69126 (Nov. 15, 2000). FAA 
explained that under its authority for safety and the movement of air 
traffic, and pending the development of a longer term solution, it 
sought to temporarily cap AIR-21 slot exemptions at LaGuardia. This 
limit, according to FAA, still allowed a significant increase in 
operations at the airport above the regulatory limits, thus serving 
congressional objectives while stretching capacity to its practical 
limits. 71 Fed. Reg. 51360 (Aug. 29, 2006). 

[47] FAA and its federally funded research and development center, the 
MITRE Corporation's Center for Advanced Aviation System Development, 
used a model that estimated the level of delay associated with various 
levels of operations at both JFK and Newark airports. 

[48] Because our analysis did not assess the behavior of individual 
airlines, we could not determine the prevalence of this practice among 
airlines. See appendix V for a detailed discussion of our analysis and 
the results. 

[49] FAA officials told us that some additional operations have been 
added in less desirable hours. 

[50] According to DOT and enforcement case precedent, airlines may not 
routinely cancel flights for economic reasons. This practice, 
according to DOT, would constitute an unfair method of competition to 
engage in "unrealistic scheduling of flights" identified in 14 C.F.R. 
§ 399.81 as an unfair or deceptive practice. See, DOT Order 97-1-6, 
Bellair Incorporated (Jan. 13, 1997). 

[51] Under specified circumstances, FAA may waive the 80 percent usage 
requirement. For example, with respect to JFK, LaGuardia, and Newark, 
FAA may waive the usage requirement "in the event of a highly unusual 
and unpredictable condition which is beyond the control of the carrier 
and which affects carrier operations for a period of five consecutive 
days or more." Waiver provisions applicable to Reagan National require 
such a condition to exist for a period of 9 or more days. 76 Fed. Reg. 
18616 (Apr. 4, 2011); 76 Fed. Reg. 18618 (Apr. 4, 2011); 76 Fed. Reg. 
18620 (Apr. 4, 2011); 14 C.F.R. § 93.227. 

[52] Although airlines might consider slots to be valuable assets, FAA 
slot regulations at 14 C.F.R. § 93.223(a), for example, provide that 
slots do not represent a property right but represent an operating 
privilege subject to absolute FAA control. 

[53] To conduct this analysis, we compared the total number of 
scheduled flights for each of 7 days in February 2011 and each of 7 
days in August 2011 with daily slot allocation numbers provided by FAA 
for each slot-controlled airport. 

[54] Specifically, we found that one or more airlines at Newark 
scheduled less than 80 percent of their allocated slots for selected 
Saturdays in the 2011 summer season. We calculated schedule data for 
the third Saturday of each month of the summer season (April, May, 
June, July, August, September, and October), which represented 7 of 
the 30 Saturdays during the 2011 summer season. FAA officials said 
that the third week of each month is most representative of the rest 
of the month. Of the 7 Saturdays that we examined, schedule rates were 
between 66 percent and 77 percent. Given average cancellation rates 
for Newark and the typical scheduling rates observed for the days that 
we examined, it is practically impossible (though theoretically 
possible) for all airlines to have met the 80 percent usage 
requirement for all slots on Saturdays in the 2011 summer season at 
Newark. 

[55] This practice is also common at slot-controlled outside the 
United States and required under the Worldwide Slot Guidelines. The 
returned slots do not count against the airline's usage rate, so long 
as they are returned before the handback deadline, which is about 10 
weeks before the start of the season. 

[56] See, DOJ, Comments of the United States Department of Justice on 
Notice of Petition for Waiver of the Terms of the Order Limiting 
Scheduled Operations at LaGuardia Airport and Solicitation of Comments 
on Grant of Petition with Conditions, (Washington, D.C.: Mar. 24, 
2010). 

[57] At the New York City area airports, FAA may waive the 80 percent 
requirement in the event of a highly unusual and unpredictable 
condition which is beyond the control of the carrier and which affects 
carrier operations for a period of 5 consecutive days or more. The 
provision applicable to Reagan National provides that such period must 
be for 9 or more days. This provision further provides examples of 
conditions which could justify waiver - weather conditions which 
result in the restricted operation of an airport for an extended 
period of time or the grounding of an aircraft type. 

[58] In April 2008, FAA published a supplemental congestion-management 
rule proposal for LaGuardia without the minimum aircraft size 
requirement. 75 Fed. Reg. 20846 (Apr. 17, 2008). The final rule for 
the Congestion Management Rule for LaGuardia, based on the 
supplemental proposal, was issued in October 2008 and rescinded in 
2009. 

[59] See, Department of Justice, Comments of the United States 
Department of Justice on Notice of Petition for Waiver of the Terms of 
the Order Limiting Scheduled Operations at LaGuardia Airport and 
Solicitation of Comments on Grant of Petition with Conditions, 
(Washington, D.C.: Mar. 24, 2010). In an analysis of aircraft size, 
DOJ controlled for the fact that commuter slots at Reagan National 
come with a restriction as to the size of the aircraft that can be 
flown. 

[60] For the purpose of this report, we defined "small" aircraft as 
one that contains 100 seats or fewer. We also examined flights for 
which a "small" aircraft was smaller than or equal in size to the 
median-sized aircraft (124 seats) in the sample of flights used for 
the model, as well as fewer than or equal to 80 seats. 

[61] For the purposes of this report, we define large hub airports as 
all FAA-identified large hub airports in the United States for 
calendar year 2010 (the most recent year available for this list), 
excluding Honolulu. Federal law defines a large hub airports as those 
that have at least 1 percent of the passenger boardings. 49 U.S.C. § 
40102(29). 

[62] The specific dates we selected were Feb. 10, 2011, and Aug. 11, 
2011. 

[63] A logistic regression (or logit model) provides an indication of 
which independent variables are correlated with the dependent 
variable--which in this case, is a flight using a small aircraft. 
Moreover, it provides this measure of correlation independent of the 
effects of the other independent variables included in the model. It 
is important to note, however, that this type of statistical method 
only suggests correlations between variables and not causation. That 
is, our findings do not provide an indication that any of the 
independent variables we included in the model actually caused (or did 
not cause) an airline to use a small aircraft for a flight, but only 
how those variables are correlated with the use of a small aircraft. 

[64] We defined Fort Lauderdale and Orlando, Florida, and Las Vegas, 
Nevada, as high-tourism airports. 

[65] The airlines classified as "legacy" included Delta Air Lines, 
United Airlines, American Airlines, US Airways, and Continental 
Airlines. Legacy (sometimes called network) airlines support large, 
complex hub-and-spoke operations with thousands of employees and 
hundreds of aircraft (of various types), with flights to domestic 
communities of all sizes as well as to international destinations. The 
modifier "legacy" derives from the fact that these airlines were 
operating when the industry deregulated in 1978. 

[66] Under federal statute and FAA slot control regulations applicable 
to Reagan National, "commuter slots" may be used only for operations 
with turboprop and reciprocating engine aircraft with no more than 76 
seats or turbojet aircraft with fewer than 56 seats. 

[67] Representatives from the remaining airline did not oppose 
establishing a minimum aircraft size, but did not believe that it was 
the best method to incent airlines to use larger aircraft. 

[68] We examined airline schedule data for scheduled domestic 
passenger flights for Feb. 10, 2011. 

[69] FAA's 80 percent minimum usage requirements pertain to how often 
a slot is used and not size or capacity of the aircraft using the slot. 

[70] One airline representative told us that the airline would need 
enough slots for three transcontinental flights per day to be 
profitable. 

[71] New York Aviation Rulemaking Committee Report, December 13, 2007. 

[72] See Steven A. Morrison, "Actual, Adjacent, and Potential 
Competition: Estimating the Full Effects of Southwest Airlines," 
Journal of Transport Economics and Policy, Vol. 35, part 2, May 2001, 
and Austan Goolsbee and Chad Syverson, "How Do Incumbents Respond to 
the Threat of Entry? Evidence from the Major Airlines," The Quarterly 
Journal of Economics (2008). 

[73] Under FAA's slot control orders for JFK, LaGuardia, and Newark, 
slots may not be bought or sold but may be leased or traded through 
the effective date of the orders, or relinquished to FAA. Under FAA 
slot regulations for Reagan National, slots may be bought, sold, 
leased, or traded, with the exception of slot exemptions, which may 
not be bought, sold, leased, or otherwise transferred, except through 
an air carrier merger or acquisition. 49 U.S.C. 41714(j). 

[74] Airlines partner with other airlines on some routes and not 
others. Under current slot control rules, airlines are not required to 
provide FAA copies of slot leases (or any information regarding 
consideration for slots transferred). FAA slot control orders for JFK, 
LaGuardia, and Newark require airlines to submit notice of a slot 
trade or lease to FAA in writing. Such trades or leases are subject to 
the confirmation and approval of FAA. The FAA slot-control regulations 
for Reagan National provide, in part, that requests for FAA 
confirmation of transfers, including leases, shall include the names 
of the transferor and recipient; whether the slot is to be used for an 
arrival or departure; the date the slot was acquired by the 
transferor; whether the slot has been used by the transferor for 
international or essential air service operations; and whether the 
slot will be used by the recipient for international or essential air 
operations, among other things. A recipient may not use a transferred 
slot without written confirmation from FAA. 

[75] Under 49 U.S.C .§ 41712, DOT may investigate whether airlines 
have engaged in "unfair and deceptive practices and unfair methods of 
competition." 

[76] To obtain views from airlines on these issues, we contacted 12 
airlines that serve Reagan National, had applied for beyond-perimeter 
slot exemptions there, or had expressed interest to FAA in serving 
that airport. Representatives from 11 of the 12 airlines agreed to 
talk with us. 

[77] For the purposes of this review, we defined large hub airports as 
all FAA-identified large hub airports in the United States for 
calendar year 2010 (the most recent year available for this list), 
excluding Honolulu. Federal law defines large hub airports as those 
commercial service airports that have at least 1 percent of the 
passenger boardings. 49 U.S.C. § 40102(29). The large hub airports 
included in our study are: Hartsfield-Jackson Atlanta International, 
Boston Logan International, Baltimore-Washington International 
Thurgood Marshall, Charlotte/Douglas International, Ronald Reagan 
Washington National, Denver International, Dallas-Fort Worth 
International, Detroit Metro Wayne County, Newark Liberty 
International, Fort Lauderdale-Hollywood International, Dulles 
International, George Bush Intercontinental, John F. Kennedy 
International, Las Vegas McCarran International, Los Angeles 
International, LaGuardia International, Orlando International, Chicago 
Midway, Miami International, Minneapolis-St. Paul International, 
Chicago O'Hare International, Philadelphia International, Phoenix Sky 
Harbor International, San Diego International, Seattle-Tacoma 
International, San Francisco International, Salt Lake City 
International, and Tampa International. 

[78] From the total slot allocations numbers, FAA removed all UPS and 
FedEx cargo operations from the totals. Additionally, FAA only 
provided slot totals for those assigned during slot-controlled hours. 
At JFK and Newark, slot-controlled hours are 6:00 a.m. to 10:59 p.m. 
Eastern Time. At LaGuardia, slot-controlled hours are 6:00 a.m. to 
9:59 p.m. Eastern Time, Monday through Friday, and 12:00 p.m.to 9:59 
p.m. Eastern Time on Sunday. At Reagan National, the airport is slot-
controlled 24 hours a day, but we examined high-demand hours, which 
are from 7:00 a.m. to 9:59 p.m. Eastern Time. 

[79] The specific dates we selected were Feb.10, 2011, and Aug. 11, 
2011. 

[80] We defined Fort Lauderdale and Orlando, Florida, and Las Vegas, 
Nevada, as high-tourism airports. 

[81] The airlines classified as legacy included Delta Air Lines, 
United Airlines, American Airlines, US Airways, and Continental 
Airlines. Legacy (sometimes called network) airlines support large, 
complex hub-and-spoke operations with thousands of employees and 
hundreds of aircraft (of various types), with flights to domestic 
communities of all sizes as well as to international destinations. The 
modifier "legacy" derives from the fact that these airlines were 
operating when the industry deregulated in 1978. 

[82] Slot controls at Chicago O'Hare Airport expired in 2002. In 1998, 
Washington National Airport was renamed Ronald Reagan Washington 
National Airport. 

[83] 33 Fed. Reg. 17896 (Dec. 3, 1968). 

[84] 35 Fed. Reg. 16591 (Oct. 24, 1970). 

[85] 73 Fed. Reg. 29550 (May 21, 2008). 

[86] Pub. L. No. 95-504, 92 Stat. 1705 (1978). 

[87] 50 Fed. Reg. 52180 (Dec. 20, 1985). The 1986 allocation and 
withdrawal rules at the High Density Traffic Airports rules did not 
apply to Newark because the High Density Rule was not then in effect 
at that airport. 

[88] GAO, Airline Competition: Industry Operating and Marketing 
Practices Limit Market Entry, [hyperlink, 
http://www.gao.gov/products/GAO/RCED-90-147] (Washington, D.C.: Aug. 
29, 1990). 

[89] National Research Council Transportation Research Board, Entry 
and Competition in the U.S. Airline Industry: Issues and 
Opportunities, Special Report 255 (Washington, D.C.: 1999). 

[90] Department of Transportation, Study of the High Density Rule: 
Report to Congress (Washington, D.C.: May 1995). 

[91] See, e.g., H. R. Rep. No. 106-67, at 77 (1999). 

[92] Wendell H. Ford Aviation Investment and Reform Act for the 21ST 
Century (AIR-21), Pub. L. No. 106-181, 114 Stat. 61, 108-109 (Apr. 5, 
2000). AIR-21 also required the phase-out of the application of the 
High Density Rule at O'Hare by July 1, 2002. 

[93] 66 Fed. Reg. 48157 (2001). 

[94] 71 Fed. Reg. 51360 (Aug. 29, 2006). 

[95] 71 Fed. Reg. 77854 (Dec. 27, 2006). 

[96] Committee members included officials from DOT's Office of the 
Secretary and FAA, the Port Authority of New York and New Jersey, and 
the State of New York as well as representatives from airlines and 
consumer groups. 

[97] 73 Fed. Reg. 3510 (Jan. 18, 2008). 

[98] 73 Fed. Reg. 29550 (May 21, 2008). 

[99] 73 Fed. Reg. 3510 (Jan. 18, 2008); 73 Fed. Reg. 29550 (May 21, 
2008). 

[100] 74 Fed. Reg. 845 (Jan. 8, 2009); 74 Fed. Reg. 51648 (Oct. 7, 
2009); 74 Fed. Reg. 51650 (Oct. 7, 2009); 74 Fed. Reg. 51653 (Oct. 7, 
2009); 76 Fed. Reg. 18616 (Apr. 4, 2011); 76 Fed. Reg. 18618 (Apr. 4, 
2011); and 76 Fed. Reg. 18620 (Apr. 4, 2011). 

[101] 73 Fed. Reg. 20846 (Apr. 17, 2008). 

[102] 73 Fed. Reg. 29626 (May 21, 2008). 

[103] 73 Fed. Reg. 60544, 60574 (Oct. 19, 2008). 73 Fed. Reg. 60544 
(Oct. 10, 2008). 

[104] 74 Fed. Reg. 52132 (Oct. 9, 2009); 74 Fed. Reg. 52134 (Oct. 9, 
2009). 

[105] See, Dec. 8, 2008 Order, Port Authority of N.Y. & N.J. v. FAA, 
No. 08-1329. 

[106] In addition, in a legal opinion issued to multiple congressional 
requesters, we concluded that FAA lacked the authority to auction 
slots and therefore also lacked authority to retain and use auction 
proceeds. GAO Legal Opinion on Federal Aviation Administration--
Authority to Auction Airport Arrival and Departure Slots and to Retain 
and Use Auction Proceeds, B-316796 (Sept. 30, 2008). The United States 
Department of Justice, Office of Legal Counsel, opined that FAA "would 
not violate the [Anti-Deficiency Act] by issuing and implementing the 
slot auction regulation." U.S. Dep't of Justice, Office of Legal 
Counsel, Whether the Federal Aviation Administration's Finalizing and 
Implementing of Slot Auction Regulation Would Violate the Anti-
Deficiency Act (Oct. 7, 2008). 

[107] Omnibus Appropriations Act, 2009, Pub. L. No. 111-8, 123 Stat. 
524, 921 (2009) 

[108] 74 Fed. Reg. 52132 (Oct. 9, 2009); 74 Fed. Reg. 52134 (Oct. 9, 
2009). 

[109] See Oct. 14, 2009 Order, Port Authority of N.Y. & N.J. v. FAA, 
No 08-1329. 

[110] Reagan National is not included in this rulemaking because it is 
covered under FAA's High Density Rule regulations. 

[111] 75 Fed. Reg. 26322 (May 11, 2010). 

[112] 76 Fed. Reg. 63702 (Oct. 13, 2011). 

[113] Pub. L. No. 99-500, 100 Stat. 1783, 1783-375 (1986); Pub. L. No. 
99-591, 100 Stat. 3341, 3341-376 (1986). 

[114] Pub. L. No. 106-181, 114 Stat. 61 (2000). 

[115] Pub. L. No. 108-176, 117 Stat. 2490 (2003). 

[116] In addition, these two laws together mandated that the slot 
exemptions at Reagan National (1) could not be used for operations 
between the hours of 10:00 p.m. and 7:00 a.m. and (2) could not 
increase the number of operations in any 1-hour period during the 
hours between 7:00 a.m. and 9:59 p.m. by more than 3 operations. 

[117] More specifically, these two laws together required the 
Secretary of Transportation to grant 24 beyond perimeter exemptions 
and 20 slot exemptions within the 1,250-mile perimeter. 

[118] Pub. L. No. 112-95, 126 Stat. 11 (2012). In addition the FAA 
Modernization and Reform Act of 2012 amended the hourly limitations 
provision whereby such slot exemptions may not increase the number of 
operations in any 1-hour period during the hours between 7:00 a.m. and 
9:59 p.m. by more than 5 operations 

[119] Four airlines each qualified to convert one slot pair. 

[120] We included all large hub airports in the United States 
identified by FAA for calendar year 2010 (the most recent year 
available for this list), excluding Honolulu International. 

[121] One hundred seats is generally the maximum seat capacity of most 
regional jet aircraft. See below for a discussion of alterative 
cutoffs for the definition of a small aircraft. 

[122] The large hub airports included in our analysis are: Atlanta 
Hartsfield International, Boston Logan International, Baltimore-
Washington International, Charlotte/Douglas International, Reagan 
National, Denver International, Dallas-Fort Worth International, 
Detroit Metro Wayne County, Newark, Fort Lauderdale-Hollywood 
International, Washington Dulles International, George Bush 
Intercontinental, JFK, Las Vegas McCarran International, Los Angeles 
International, LaGuardia, Orlando International, Chicago Midway, Miami 
International, Minneapolis-St. Paul International, Chicago O'Hare 
International, Philadelphia International, Phoenix Sky Harbor 
International, San Diego International Lindbergh, Seattle-Tacoma 
International, San Francisco International, Salt Lake City 
International, and Tampa International. 

[123] In addition to the independent variables listed here, we tested 
whether scheduled flights in February (winter) had any greater 
likelihood of using a small aircraft than scheduled flights in August 
(summer). We did not find any significant difference, so we did not 
include this variable in our analysis. 

[124] Flight frequency also serves as a proxy for an airport hub 
variable that would consider whether the airport serves as a network 
hub for an airline. 

[125] Odds are a ratio of the probability that an event will occur 
versus the probability that the event will not occur, or probability/ 
(1-probability). Odds ratios, therefore, are simply a ratio of odds; 
in general they refer to the ratio of the odds of an event (small 
aircraft) occurring in the exposed group (slot-controlled airports) 
versus the unexposed group (other large hubs). 

[End of section] 

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