Air-Traffic Upgrade Over Budget, Facing Delays: Report

Photographer: Scott Eells/Bloomberg

An air traffic control tower stands above the tarmac at John F. Kennedy International Airport in New York. Close

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Photographer: Scott Eells/Bloomberg

An air traffic control tower stands above the tarmac at John F. Kennedy International Airport in New York.

A $438 million replacement of U.S. air-traffic computers, a component of the $42 billion shift to satellite-based navigation, is going over budget and faces “significant risks” of missed deadlines, a report said.

The system, which allows controllers to monitor aircraft within about 50 miles (80 kilometers) of an airport, is expected to cost $270 million more than current estimates, a 62 percent increase, the Transportation Department’s inspector general said in a report today.

Risks of delays are growing because the Federal Aviation Administration hasn’t completed technical requirements or followed its own rules for setting completion schedules, the inspector general found.

“It remains unclear how and when FAA will accomplish all the tasks necessary,” the report said.

The program’s first phase is supposed to install an updated version of a system known as Standard Terminal Automation Replacement System, or STARS, at 11 metropolitan regions by 2017.

It’s built by Raytheon Co. (RTN), the Waltham, Massachusetts-based technology and defense contractor. A call to Caroline Harris, a Raytheon spokeswoman, wasn’t immediately returned.

STARS is needed to accommodate other new technology in the FAA’s NextGen replacement of the air-traffic system, according to the report. Instead of tracking planes on radar, NextGen will rely on more precise satellite-based technology.

Known Risks

Seven of the 11 facilities are the busiest in the U.S., including Southern California and New York, according to the report by Jeffrey Guzzetti, assistant inspector general for aviation audits.

STARS was first introduced in the late 1990s in some medium-sized radar rooms near airports. Because of cost overruns and technical shortfalls, the FAA kept a similar system built by Bethesda, Maryland-based Lockheed Martin Corp. (LMT), called the Common Automated Radar Terminal System, at some facilities.

The agency wants to replace the aging Lockheed system with STARS so all facilities use the same technology, it said in a response to the report. The issues raised by the inspector general had already been identified by the FAA, according to the agency response.

“The key here is that the risks are known, and are being managed,” the FAA wrote.

Satellite Navigation

A separate computer system that allows controllers to track aircraft at higher altitudes, Lockheed’s $2.4 billion En Route Automation Modernization project, known as ERAM, is also over budget and marred by technical breakdowns, according to Inspector General Calvin Scovel.

The system, which is $300 million over budget, could cost an additional $200 million and be delayed as much as two years beyond its 2014 target for completion, Scovel testified before the House aviation subcommittee on Sept. 12.

The network of ground stations and computers at the core of the NextGen system is on track for its scheduled completion by next year, according to a Government Accountability Office report last year.

Known as Automated Dependent Surveillance-Broadcast or ADS-B, it monitors thousands of aircraft, which broadcast their positions using global positioning satellites that are more accurate than radar. The lead contractor on the project is Exelis Inc. (XLS) of McLean, Virginia.

To contact the reporter on this story: Alan Levin in Washington at alevin24@bloomberg.net

To contact the editor responsible for this story: Bernard Kohn at bkohn2@bloomberg.net

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