Spurred on by Industry, OIRA Weakens Rule to Prevent Fatigue-Related Aviation Catastrophes

by James Goodwin

May 30, 2012

Last December, the Federal Aviation Administration (FAA) finalized a new aviation safety rule designed to prevent excessive pilot fatigue, a problem that had contributed to at least one high-profile airline disaster—the Colgan Air Flight 3407 crash near Buffalo, New York, in February of 2009, which killed 50 and injured four—as well as to a disturbing series of mishaps and “near misses.”

It turns out that the rule took a mid-flight detour on its journey from proposal to final form, and that the way in which it was weakened along the way is a textbook example of how the White House Office of Information and Regulatory Affairs manages, at the behest of industry, to override the plain meaning of statutes requiring regulation. The proposal, issued for public comment in September 2010, covered cargo-only pilots as well as passenger pilots. That made a certain sense, because while cargo-only pilots don't carry as many passengers, they're still flying big aircraft, the safe operation of which requires an attentive pilot. But when the final rule came out in December, cargo-only pilots were exempted.   In their comments, some members of the cargo-only airline industry had suggested that the FAA amend the proposal to include this exemption, arguing that the costs of the rule outweighed the benefits of preventing all-cargo planes from crashing. According to the draft final rule, however, the FAA had rejected this suggestion.

If the public comments hadn’t persuaded the FAA that an exemption for all-cargo pilots was appropriate, then what could have changed the agency’s mind at the last minute? A close review of the record reveals that the rule was weakened at the behest of the OIRA. A red-lined version of the final rule showing all the changes that had been made to the draft while it was under OIRA review confirms that this exemption was added during OIRA's review process. What’s more, the red-lined version shows that OIRA directed the FAA to include new language in the rule’s preamble justifying this change solely on the basis of cost-benefit analysis, with clear disregard for applicable law and relevant science.

A little background is in order. In 2010, following the Colgan Air disaster, Congress passed the Airline Safety and Federal Aviation Administration Extension Act. In the disaster’s aftermath, investigators attributed the crash primarily to pilot error arising from excessive fatigue; regional pilots, such as those employed by Colgan Air, frequently log long, irregular hours with inadequate time in between shifts to rest properly. The new legislation directed the FAA to take several steps to prevent future fatigue-related plane disasters, including issuing a new regulation establishing maximum flight and duty times for pilots and other flight crew members as well as minimum rest periods between shifts. Significantly, Congress directed the FAA to base these new regulations on the “best available science information” related to fatigue and human sleep requirements.

Quite sensibly, the FAA followed that mandate, and acknowledged in its proposal that the relevant "best available science" applied universally to all pilots—passenger and cargo-only pilots alike. By adopting this standard, the agency reasoned, Congress did not authorize the FAA to treat commercial pilots differently based upon who—or what—they happened to be carrying in their planes. Even if a cost-benefit analysis did support such differential treatment, the FAA did not have the authority to take that into account in its decision-making. That, at least, is what the law says.

Unfortunately, such good sense did not sit well with the all-cargo airline industry. If adopted, the rule would likely force these airlines to hire more flight crew to cover the staffing shortfalls that the rule’s limits on work hours and minimum rest periods might create, cutting into these airlines’ bottom lines. No more would these companies be able to maximize profits on the backs of overworked flight crews.

Recognizing that the FAA might be reluctant to ignore its statutory mandate and the relevant science, the all-cargo airline industry started reaching out to OIRA even before FAA had sent the draft rule to the agency for its review. OIRA has historically been receptive to industry arguments that ignore matters of law and science in pursuit of its single-minded focus on reducing costs for regulated industries at the expense of the public interest. Accordingly, industry representatives met with OIRA officials behind closed doors and argued that the rule would be too expensive and that its benefits would not justify its costs. In all, they met with OIRA at least six times (7/22; 7/25a; 7/26a; 7/26b; 8/17; 10/12). (OIRA online records list a second meeting on July 25th, but the weblink to that meeting is dead.)

In fact, in their zeal to attack the FAA’s proposal through OIRA's back door, the industry representatives met with OIRA at least four times before the FAA even submitted the draft final rule to OIRA for review on August 17, and a fifth meeting took place that very day.  (Even though the industry representatives began their lobbying early, that didn’t encourage OIRA to wrap up its review of the draft final rule in a timely fashion.  In all, the review lasted 125 days, five days beyond the maximum permitted under Executive Order 12866.)

More importantly, in materials presented at those meetings, industry representatives argued in favor of exempting cargo-only pilots from the rule’s coverage. (For example, see page 17 here or page 3 here.)

Proponents of a stronger rule met with OIRA on at least five occasions in a valiant effort to resist the industry’s attempts to weaken it.   Even a group of family members of the victims of Colgan Air disaster weren’t able to impress upon OIRA’s bean counters the dangers of pilots suffering from excessive fatigue.

Once the dust from all those meetings had settled, OIRA forced the FAA to rewrite the rule to exempt pilots of cargo-only planes, substituting its judgment for the legal and scientific expertise at FAA. The justification for the change was a new cost-benefit analysis for the rule, seemingly performed for the first time during OIRA’s review of the draft final rule. (The rule was not classified as “economically significant,” and thus under Executive Order 12866, the FAA was not required to perform a full-blown cost-benefit analysis. That probably explains why debates over the rule’s cost-benefit analysis didn’t pop up until the rule was nearly completed.)  Under OIRA’s new cost-benefit analysis, a rule that applied to pilots of passenger planes passed the cost-benefit test, because it would theoretically produce large benefits by potentially saving several human lives, which have a relatively high benefit. In contrast, the benefits of a rule that would only potentially protect the lives of a few flight crew members on an all-cargo plane and whatever cargo they were carrying wouldn’t be enough to pass the same cost-benefit test.

The episode provides vivid illustration of the pattern of OIRA’s political interference in agency rulemaking documented in CPR’s December White Paper, Behind Closed Doors at the White House: How Politics Trumps Protection of Public Health, Worker Safety and the Environment.   In fact, the only element of the tale that breaks with the pattern we saw in the research for that report is that in this instance, there was a rough equivalence between meetings of groups both for and against weakening the rule. Typically, OIRA meets with many more industry representatives than public safety advocates or union or association representatives. What was not at all unique was that industry’s complaints led to a weakening of the FAA’s final rule. To provide a post-hoc rationalization for the rule change, OIRA simply resorted to its old friend, the endlessly malleable technique of cost-benefit analysis.

Remarkably, the story of the FAA’s pilot fatigue rule is not over yet. The Independent Pilots Association (IPA), one of several professional associations representing cargo-only pilots, has challenged the final rule, arguing that OIRA’s last-minute change to the rule violated the law. The IPA filed a brief on April 24, arguing that the statute authorizing the pilot fatigue rule prohibits decision-making based on cost-benefit analysis (similar to the vast majority of environmental, health, and safety statutes.) Instead, the statute required the FAA to base the rule on considerations of science only. The brief argued further that OIRA’s back-of-the-envelope cost-benefit analysis was fatally flawed, pointing out several ways in which it failed to account for obvious benefits of the rule, resulting in an analysis that was skewed against the stronger rule that the FAA had proposed. Finally, the brief argues that the FAA violated the Administrative Procedure Act by making substantive changes in the final rule that were not a “logical outgrowth” of the proposed rule without allowing for public notice and comment, and by failing to disclose for public review and comment the cost-benefit analysis that was the basis for the changes to the final rule.

For its part, the FAA recently requested in a May 17 motion that the DC Circuit Court of Appeals, the court that is reviewing the IPA’s challenge of the pilot fatigue rule, delay the IPA’s case, so that the agency can correct errors in the OIRA-imposed cost-benefit analysis and then release the revised cost-benefit analysis for public review and comment. Significantly, the FAA indicated that it had erroneously underestimated the costs of the rule in the first cost-benefit analysis, which suggests that the agency expects to find an even stronger justification for the exemption for cargo-only pilots. This means that the FAA’s revisions to the cost-benefit analysis are unlikely to lead the agency to amend the rule to eliminate the cargo-only exemption, as the IPA is seeking in its suit.

In the end, though, the IPA’s suit shouldn’t turn on the specifics of the FAA’s cost-benefit analysis. Instead, hopefully, the DC Circuit will get it right, follow the law, and hold that OIRA and FAA had no business substituting a cost-benefit analysis for the "best science" standard Congress established for the rule. And then the court should order the agency to either find a defensible scientific basis for the cargo-only exemption or eliminate it. I’ll be watching to see how the case turns out and what implications, if any, the result has for other instances when OIRA forces agencies to issue rules based on cost-benefit analysis rather than in accordance with applicable law and the best available relevant science.

Tagged as: OIRA FAA
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Also from James Goodwin

James Goodwin, J.D., M.P.P., is a Senior Policy Analyst with the Center for Progressive Reform. He joined CPR in May of 2008.

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