Changes to Federal regulations must undergo several economic

analyses. First, Executive Order 12866 directs that each Federal agency

shall propose or adopt a regulation only upon a reasoned determination

that the benefits of the intended regulation justify its costs. Second,

the Regulatory Flexibility Act of 1980 requires agencies to analyze the

economic effect of regulatory changes on small entities. Third, the

Office of Management and Budget directs agencies to assess the effect of

regulatory changes on international trade. In conducting these

analyses, the FAA has determined that this Final Rule will generate

benefits that justify its costs and is "a significant regulatory action"

as defined in the Executive Order. The FAA estimates, however, that the

final rule will not have a significant economic impact on a substantial

number of small entities. No part of the final rule will constitute a

barrier to international trade. These analyses, available in the

docket, are summarized below.

A. Sections Without Cost Impacts

Those part 121 sections that the FAA has determined will not

impose additional costs on part 135 commuter operators are not

described in this summary evaluation. Each of those part 121 sections

will not impose costs for one of the following reasons: (1) current

practice is identical or very similar to the new requirement; (2) the

new requirement represents minor procedural changes; (3) the section

determines general applicability and does not specifically impose any

costs; or (4) certain requirements of part 135 would be incorporated

into part 121 without change. Those part 121 sections without costs

are described in the full evaluation under each of the areas for which

they apply. While not shown in this summary evaluation, it is

important to note that 10 of the sections in the final rule were

identified as having negligible costs. These negligible costs, even

when combined, will not be significant.


The rule will impose costs on part 135 operators with 10-to-30-

seat airplanes. The FAA estimates the total cost of the rule will be

$117.80 million over the next 15 years in 1994 dollars, with a present

value of $75.19 million (7 percent discount rate). The total

potential costs for 10-to-19 and 20-to-30-seat airplanes are presented

in the following areas:



















Cabin Safety





Part 119















Based on the $80.36 million figure shown above, the FAA estimates

that, on average over the next 15 years, the price of a one-way

airline ticket will increase by $0.62 for affected operators with 10-

to-19-seat airplanes. Similarly, based on the $37.44 million figure,

the ticket price will increase by $0.30 for affected operators with

20-to-30-seat airplanes.

It is important to note that the total cost per airplane in each

of the first four years of the rule sheds light on the initial

compliance costs. These costs per airplane are as follows:

10-to-19 seat
















1. Operations

This section of the regulatory evaluation examines the costs of

the changes with regard to operations. Fifteen-year costs for

operations requirements will total $73.19 million ($46.18 million,

present value). The cost items, by section, are provided below.

Section 121.97: Airports Required Data. Each domestic and flag

air carrier must show that each route it submits for approval has

enough airports that are properly equipped and adequate for the

proposed operation. Consideration is given items as size, surface,

obstructions, etc. In short, this requirement will ensure that in the

event of a single-engine failure each operator's airplane type

(regardless of the number of airplanes) can either stop at the end of

the runway or, if it continues to fly, can safely clear all of the

obstacles in the flight path.

To estimate the potential cost of this requirement, the FAA

contacted several commuter operators. According to these operators,

the potential cost of compliance is based on performance-obstacle-data

analyses for airplane types at particular airports. To ensure that

the performance objective will be met, operators are required to make

certain that the maximum-allowable-takeoff weight is always achieved

under certain temperature conditions. This is done by conducting

performance analyses for each airplane type at the airport it intends

to operate. To achieve this objective, operators typically hire a

contractor to perform obstacle-location and height surveys. The

contractor uses the airplane's flight-manual-performance data to

assess flap settings and runway-end capability for a particular

airport for information related to takeoff-run-acceleration distance,

runway length, anti-skid, etc.

The typical contractor fee is $20 per runway. For example, ABC

airlines is a commuter operator with 5 types of airplanes that it

wishes to operate at airports in 10 cities. Each city has an airport

with 10 runways. The operator, however, only intends to use two

runways per airport in each of the 10 cities. The cost performing the

needed obstacle performance data analyses is $2,000 ($20 per runway x

10 airports x 2 runways per airport x 5 airplane types). While this

is a simple example of estimating a fictitious operator's potential

cost of compliance, it sheds light on the difficulty of deriving such

costs reliably. Although reliable information is available on the

cost of contractor conducted obstacle-performance-data analyses, the

same reliability does not apply to the number of runways or airports

commuter operators will use. Potential costs for this requirement

cannot be estimated reliably without knowing what airports, runways,

and the types of airplanes operators will use. It is for this reason

that this section of the evaluation contains no estimate for costs.

Despite this situation, the FAA contends that this requirement is an

important element in achieving the one-level-of-safety objective.

Section 121.99: Communications Facilities. Currently, this

section requires each domestic and flag air carrier to show

availability of a two-way air/ground radio communication system at

points that will ensure reliable and rapid communications, under

normal operating conditions over the entire route (either direct or

via approved point-to-point circuits). Each carrier also must show

that the system is accessible between each airplane and appropriate

dispatch office, and between each airplane and the appropriate ATC

unit. In addition, each system must be independent of any other

system operated by the United States.

To estimate the potential cost, the FAA contacted several

industry sources, including operators and data link service venders.

These sources indicated that the least expensive option for most

operators would be a voice data link service from an FAA-approved

vender. According to Aeronautical Radio, Inc. (ARINC) and several

operators with operations specifications for parts 121 and 135

(scheduled), the needed voice-data-link service consists of a monthly

access fee of $35 per operator and a fee of $14 per contact. Contact

refers to any form of voice communication between the pilot while in

flight and the home dispatcher.

If, from a worst case standpoint, none of the current commuters

have this access service, the total cost will be the number of

affected operators times the monthly access fee of $35 over the next

15 years. This evaluation estimates that the number of commuter

operators will range from 63 in 1996 to 73 in 2010. This will result

in a total cost of $445 million ($269 million, present value). The

contact fee cost can be estimated in a similar manner, though it

employs a great deal more of uncertainty because the actual number of

contacts each operator will make annually is unknown and usually

varies among operators. According to industry sources, there will be

a certain percentage of contacts per annual departures for each

airplane in an operator's fleet. Based on information contained in

the Regional Airlines Association's Annual Report for 1994, each

airplane in the U.S. commuter fleet makes an average of 5.68

departures per day or 2,074 annually. The number of airplanes with 10

to 30 seats in the U.S. commuter fleet is projected to range from 950

in 1996 to 1,099 in 2010.

Initially for this evaluation, the FAA assumed at least one

contact per departure. Multiplying the 2,074 annual departures times

the $14 contact fee gives the total potential contact cost of $445

million ($269 million, present) over the next 15 years. In realistic

terms, however, this cost estimate is too high because it does not

reflect the actual practice in industry. According to several

operators, contacts via ARINC or a similar service would only be made

during emergency situations (for example, flight delays, inclement

weather, etc.). Within an average radius of 50 nautical miles,

contacts can be made directly between the airplane pilot and the home

dispatcher, without the aid of an external-communications-voice-data

network (e.g., ARINC or a similar service). In flat lands, this

communication can be made up to 100 miles, when the dispatcher is

located at the hub. In high terrain areas, communication with the

home dispatcher would have a radius of less than 50 miles. In

emergency situations that arise beyond the average radius of 50 miles,

ARINC or similar service would be needed. This would be especially

true in remote areas such as the U.S. northern frontier (Montana,

Idaho, etc.), Alaska, American Samoa, and Hawaii. This information

indicates that frequency of use of ARINC or a similar service may not

be as high as originally expected. According to some operators, the

likelihood of having at least one contact via ARINC per airplane

departure by an operator, on average, could range from 5 to 10

percent. When considering that contacts via ARINC or a similar

service beyond the 50-mile radius would only be made in emergency

situations, operators, on average, would make contact on 10 percent of

their airplane departures. Employing this approach, costs will amount

to $44 million ($26 million, present value) over the next 15 years.

In addition to the information above, industry sources contacted

indicated that commuter operators with dual or split operations

specifications (both parts 121 and 135) already have this capability.

These operators (approximately 19) account for over 60 percent of all

the airplanes in the U.S. commuter fleet. This scenario will result

in estimated costs of $18.9 million ($11.5 million, present value)

over the next 15 years. This cost estimate also recognizes that the

number of contacts will be lower because pilots typically contact ATC

for information related primarily to weather and air traffic delays.

Therefore, this evaluation assumes only 10 percent of the commuter

airplane departures, by operators without dual operations

specifications, will engage in contacts via ARINC or similar service.

Section 121.135 - Contents of Manual. This section will require

an extensive list of manual contents for operators. Unlike part 135,

part 121 requires more detailed instructions to flight and ground

personnel, including dispatch procedures, airport information, and

approach procedures. The manuals of part 121 operators are, on

average, three times as voluminous as those of part 135 operators.

Thus, compliance with the final rule will result in major rewrites of

manuals. Based on cost information received from industry, affected

operators will spend an additional $50,000 on average ($30,000 to

$70,000) each for new manuals. This cost estimate multiplied times

the number of operators over the next 15 years will total

approximately $3.65 million, ($3.28 million, present value). This

cost estimate for manuals takes into account additional preparation

and distribution requirements.

Section 121.337 - Protective Breathing Equipment (PBE) for the

Cockpit. This section will require PBE units for persons operating

airplanes under part 121. Part 135 has no PBE requirement. While

commuter airplanes are typically smaller than airplanes operating

under part 121, the accessibility of PBE in the cockpit will provide

smoke-and-fumes protection for pilots. The airplane operator is

allowed to use fixed equipment such as oxygen masks and smoke goggles

at each pilot station. Depending on the present airplane

configuration, this may require substantial modifications.

According to FAA's technical personnel, airplanes with 20-to-30

seats already have fixed PBE units for pilot stations in the cockpit

for smoke and fume protection but they are not equipped with a

portable PBE unit for fire fighting. In terms of operators with 10-

to-19-seat airplanes, the FAA is uncertain as to how many part 135

operators are already equipped with PBE (portable or fixed) in the

cockpit. As the result of this uncertainty, this evaluation assumes

that part 135 operators with 10-to-19-seat airplanes are not currently

equipped with PBE in the cockpit. This evaluation also assumes that

operators with 20-to-30-seat airplanes do not have portable PBE in the

cockpit for firefighting. The installation of fixed PBE in some

commuter airplanes could be prohibitively expensive because of

complex breathing gas supply requirements. Since portable PBE is much

cheaper than fixed PBE, operators with 10-to-19-seat commuter

airplanes are assumed to acquire and install portable smoke and fume

PBE in the cockpit if not equipped with an oxygen system. Each

portable PBE is estimated to cost $400 per unit. In 1996 and

subsequent years, operators with 10-to-19-seat airplanes are assumed

to install two smoke-and-fumes portable PBE units in the cockpit: one

at each of the two pilot stations. Over this same period, operators

with 20-to-30-seat airplanes are assumed to install one additional

fire-fighting-portable PBE unit in the cockpit. In addition to PBE

units, costs are also estimated for the weight penalty of each PBE

unit. Each of the cost components multiplied by the number of

airplanes in existence, over the next 15 years, will result in an

estimated cost of $2.64 million, ($1.81 million, present value).

Section 121.357 - Airborne Weather Radar. This section will

require part 135 commuters to equip their airplanes with approved

weather radar. Currently, section 135.173 requires that operators

equip their airplanes with either thunderstorm detection equipment or

approved weather radar. However, section 135.175 requires operators

of airplanes with 20 to 30 passenger seats to equip their airplanes

with weather radar. An estimated 90 percent of all commuter airplanes

with 10-to-19 passenger seats already have approved weather radar

equipment. Based on this information, the rule will only affect an

estimated 10 percent of those operators of airplanes with 10-to-19

seats (excluding commuter operators in Alaska and Hawaii which are not

covered by the rule). Because of their unique flying environments,

commuter operators in Hawaii and Alaska are not required under current

regulations to be equipped with weather radar equipment. Weather

radar costs approximately $30,000 per airplane, including

installation. Each weather radar unit weighs 25 pounds. This weight

translates into an average weight penalty of 87 gallons of fuel per

airplane per year. The sum of these cost components multiplied by the

number of commuter airplanes over the next 15 years will total $5.08

million ($3.73 million, present value).

Sections 121.593-595: Dispatching authority for domestic and

flag air carriers; 121.107: Dispatch centers; 121.533-535:

Responsibility for operational control; 121.683: Crewmember and

dispatcher record; 121.687: Dispatch release; and other sections that

assign specific duties to dispatchers. The rule will require that

flights in scheduled commuter operations with 10-to-30 seat airplanes

be authorized by a dispatcher. Dispatchers currently are not required

under part 135. The FAA assumes that the majority of operators

currently certificated only under part 135 do not employ fully

qualified dispatchers. These operators primarily employ full-time

flight locators . The FAA further assumes that operators conducting

both parts 121 and 135 operations currently employ half as many

qualified dispatchers as they will need to dispatch all of their


The number of dispatchers was primarily calculated using

information provided by Airline Dispatchers Federation (ADF) and

industry sources. The ADF estimated that an air carrier with 30

airplanes will need eight or nine dispatchers to staff a 24-hour

operation. The FAA used a ratio of eight dispatchers to 30 airplanes

of 10 or more passenger seats for each part 135 commuter air carrier.

The total number of required dispatchers was computed by multiplying

the number of airplanes with 10 or more passenger seats operated by

each air carrier by the ratio 8 to 30. However, to take into account

that an 8-hour day might not cover all of an air carrier's daily

flights, as well as vacation and sick leave, the FAA assumes that each

air carrier will need at least two dispatchers. In 1996, 307

dispatchers will be needed to meet the requirements of this rule. In

1997, the number of dispatchers will be 318 and will grow to 353 by


Unlike in regulatory evaluation for the proposed rule, the cost

of compliance for the final rule is based primarily on the median

annual salary differential between flight locators and dispatchers.

The FAA estimated the median annual salary of a part 135 dispatcher on

the hourly wage of $9.10 reported by the ADF. The FAA computed an

annual median salary of $23,849 for a dispatcher by multiplying the

ADF's hourly wage rate estimate of $9.10 times a fringe benefits

factor of 1.26 (or 26 percent) and full-time yearly hours of 2,080 (52

wks. x 40 hrs.). Similarly, the median annual salary of a flight

locator was estimated to be $19,656 ($7.50 x 1.26 x 2,080). The

annual median salary differential was estimated to be $4,193 ($23,849

less $19,656).

Based primarily on information received from FAA technical

personnel and industry (operators and ADF's comments on the NPRM),

about 67 percent of the required flight dispatchers will come from

existing part 135 flight locators and approximately 33 percent of the

required dispatchers will be hired from outside by operators. Some of

these new hires will be supervisors/trainers. According to several

commuter operators contacted recently, they will have to hire

dispatchers from outside of their company in order for them to meet

the proposed dispatcher requirements. The decision to hire

dispatchers from the outside is based primarily on: (1) the need for

additional supervisory personnel because of the projected number of

inexperienced dispatchers to be hired under part 121 and (2) all of

their existing personnel (flight locators and to some flight

followers) cannot be trained at once without seriously disrupting

daily operations. Thus, of all the new dispatchers projected to be

hired over the next 15 years, about 67 percent will be from existing

personnel (upgraded from flight locators and some flight followers)

with the affected commuter operators and 33 percent from the outside

(or non-upgraded employees).

Training costs include 40 hours of initial training, 10 hours of

recurrent training, and 5 hours of operating familiarization for

dispatchers who authorize turbopropeller flights (as required by

sections 121.422(c)(1)(ii), 121.427(c)(4)(ii), and 121.463(a)(2)).

Air carriers are assumed to incur the cost of dispatchers' salaries

during training. In addition to salary costs, the FAA assumes that

the air carrier will incur $1,000 in costs for initial training for

each dispatcher and $500 in costs for recurrent training for each

dispatcher. The FAA estimates that each carrier will incur $1,000 in

administrative costs for each dispatcher hired. The FAA recognizes

that during the initial and follow-up training for new dispatchers,

operators may incur additional costs in the form of reduced

operational efficiency, though to what extent is unknown. However, in

view of all available information, the FAA has no indication that such

costs would be significant.

Total personnel-related costs were calculated by adding the

salary, training, administrative costs, and multiplying by the number

of new dispatchers required. The FAA estimates that the dispatcher

requirement will cost $42.86 million ($25.9 million, present value)

over the next 15 years. Approximately $25.66 million ($15.49 million,

present value) will be borne by operators of 10-to-19-seat airplanes,

and the remaining $17.20 million ($10.38 million, present value) will

be borne by operators of 20-to-30-seat airplanes.

According to the ADF, most part 135 operators already have

facilities and communications equipment that satisfy the dispatch

requirements under part 121. Accordingly, the FAA has not included

estimates of additional costs attributable to facilities and

equipment. The FAA acknowledges that this is a reasonable assessment

since all commuter operators exercise some degree of operational

control with the use of either flight locating or flight following.

The provision of either one of these services requires communication

facilities and associated equipment.

Section 121.383: Age-60 Requirement. This section will prohibit

operators of airplanes in scheduled service with 10-to-30 passenger

seats from using people over the age of 60 as pilots for that

service. Currently there is no age restriction for pilots in part 135

operations. Based on data provided by the Air Line Pilots Association

(ALPA), the FAA estimates that only about 0.55 percent of part 135

commuter pilots are currently over the age of 60. The FAA estimates

that about 45 pilots will be affected if the requirement takes effect

in the year 1999. The FAA also estimates, based on ALPA data, that

0.32 percent of current part 135 pilots would reach age 60 in

subsequent years and thus about 27 pilots would need to be replaced

each year from 1999 on.

The FAA is unable to quantify the costs to operators or to

affected pilots. The nature and magnitude of these costs depend upon

the alternatives available to each party, which the FAA has been

unable to identify in sufficient detail to estimate costs. The FAA

believes that the four-year phase-in of this requirement will help to

minimize any potential disruptions the rule may cause and that the

resulting cost are not likely to be substantial. The FAA also

believes that the age 60 requirement is essential to achieve the "one

level of safety" goal established by the Secretary of Transportation

and that any cost of this requirement is justified by its benefits.

2. Cabin Safety

This section of the regulatory evaluation examines the costs of

the changes with regard to cabin safety. Over the next 15 years,

costs for cabin safety items will total $11.57 million ($8.20 million,

present value). The cost items, by section, are provided below.

Sections 121.133, 121.135, and 121.137 - Flight Attendant Manual.

These sections will require all flight attendants to have an

operations manual. There is no such requirement for flight attendants

currently working for part 135 operators. This requirement

necessitates preparing such manuals for each flight attendant . Since

each flight attendant is required to have a manual, the number of

manuals equals the number of flight attendants. The 15-year cost for

the preparation, copying, and binding of these manuals is $61,600

($47,200, present value). The costs involve the preparation of the

manual contents and the copying and binding of the finished manual.

FAA analysis projects 277 20-to-30-seat airplanes in 20 air carriers

in 1996, increasing to 556 such airplanes in 39 air carriers by 2010.

Each air carrier will employ a flight attendant supervisor (paid at

$24.19 per hour) and a clerical worker (paid at $11.00 per hour) to

spend 40 hours each preparing a manual; hence, it will cost each air

carrier about $1,400 to prepare a manual. The manual is an average of

100 pages long; at $.10 to copy each page, and $2 to bind each manual,

total copying and binding costs is expected to total $12 for each

manual. Existing air carriers with new airplanes in the future will

have to reproduce a new manual for each airplane. All new air

carriers with 20-to-30-seat airplanes, which will total 19 by 2010,

will also have to prepare and publish flight attendant manuals.

Section 121.285 and 121.589 - Carry-On Baggage. These sections

will require affected operators to stow carry-on baggage and develop a

program to screen carry-on baggage. Screening, in this context,

refers to a visual check to ensure that the carry-on baggage is the

proper size and could be stored properly on the airplane; it does not

refer to security screening. Currently, part 135 airplanes adhere to

substantive baggage stowage procedures, but part 121.589 requires that

a crewmember verify that all baggage is properly secured before all

doors are closed and the airplane leaves the gate. Some air carriers

argue that this requirement will increase time at the gate, reduce

airplane utilization time, and thus result in lower revenue to air

carriers. The FAA contends that there will be no costs for this

procedure due to the minimal time necessary to properly secure carry-

on baggage and the fact that airplanes experience routine delays

anyway while waiting for clearance on the runway. The cost of the

rule will involve the preparation of an addendum to the Operations

Specifications in which each carrier will outline its procedures for a

baggage program.

The 15-year cost for operators of 10-to-30-seat airplanes to

prepare a carry-on baggage addendum to the Operations Specifications

will be $20,600 ($18,500, present value). This cost is divided

between 10-to-19-seat airplanes ($12,300) and 20-to-30-seat airplanes

($8,300). For each air carrier, this process involves two people--a

flight attendant supervisor for 20-to-30-seat airplanes or a

crewmember supervisor for 10-to-19-seat airplanes (both paid at $24.19

per hour) and a clerical person ($11.00 per hour) to do the paperwork

(average of 8 hours each) and to develop the addendum. Each carrier

will bear the cost of developing the addendum for the airplanes in its

fleet; it costs each air carrier about $280 for this work. The number

of air carriers is projected to rise from 63 in 1996 to 73 in 2010.

Finally, the actual baggage screening function will not impose costs

because part 135 crewmembers are already required to screen baggage in

order to secure it.

Section 121.291(d) - Ditching Demonstration. This section

requires new air carriers to conduct a ditching demonstration for each

airplane type it proposes to operate in extended overwater operations.

There is no similar requirement in part 135.

In the NPRM, the FAA used an estimate that 25 percent of all 10-

to-30-seat airplanes conduct extended overwater flights. Upon further

examination, this assumption turned out to be too high. Based on a

recent survey, the FAA has ascertained that less than 3 percent of all

10-to-19 seat airplanes (14 airplanes) and no 20-to-30-seat airplanes

currently conduct overwater flights. The percentages were projected

into the future. Based on this paucity of airplanes certificated for

extended overwater flights, the FAA tried to estimate the costs for

part 135 operators to conduct ditching evacuation demonstrations for

new 10-to-30-seat airplanes using two different methods. In both

cases, as will be shown below, the 15-year cost for part 135 operators

to conduct ditching evacuation demonstrations for new 10-to-30-seat

airplanes will be zero.

The first method involves taking an aggregate approach and

examining the entire fleet using the same methodology used in the

NPRM. This involves a demonstration which requires crewmembers to

perform ditching evacuation drills and safety procedures including the

deployment of one raft. For both 10-to-19- and 20-to-30-seat

airplanes the annual incremental change in the number of airplanes

times the applicable percentage of airplanes conducting extended

overwater flights was zero for every year between 1996 and 2010.

Accordingly, using this methodology, the cost will be zero.

The second method involved individually examining those air

carriers that this provision affects. The FAA was able to identify

those operators that conduct extended overwater operations with 10-to-

30- seat airplanes. In every case, the airplanes involved were 10-to-

19-seat types. Since the FAA is projecting only a modest increase in

such airplanes through 1997 and an overall decline in 10-to-19-seat

airplanes after 1997, it is highly unlikely that these operators will

seek to increase their fleet size with a new airplane make and model

currently not in its fleet that will require a ditching evacuation

demonstration. Therefore, there will be no cost.

Both the operator and the FAA incur labor costs to complete a

ditching demonstration. The actual demonstration takes about one hour

to complete and requires two sets of crews. If an operator should need

to conduct a ditching demonstration, the FAA estimates the cost for a

10-to-19 seat airplane at $1,025 per demonstration.

Section 121.309 - Medical Kits. This section will require

affected commuters to have one medical kit on each 20-to-30-seat

airplane for those operators. The FAA has decided to except 10-to-19-

seat airplanes from this requirement due to their smaller size and the

unlikelihood that a medical professional will be on board or a flight

attendant to administer the use of the kit.

The FAA estimates that the 15-year cost for providing medical

kits on the 20-to-30-seat airplanes operating under part 135 will be

$1.11 million ($674,300, present value). The costs of providing

medical kits are composed of acquisition ($200 each) with a 60 percent

spares reserve, installation, annual replacement (5 percent), annual

maintenance ($20 per kit), a weight penalty (7 pounds per unit),

physician consultation expenses ($500 per consultation), engineering

and administrative costs, and record keeping (1 hour each time a kit

is used at $20.58 per hour).

Acquisition, replacement, and maintenance costs for kits are a

function of the number of airplanes. In the first year of the rule,

the bulk of the medical kits will be purchased; 443 kits will be

needed for 277 airplanes, which takes into account the 60 percent

spares reserve. Additional kits are purchased in the future as the

airplane fleet increases to 556 airplanes in 2010, and to take into

account a 5 percent annual replacement rate. Maintenance costs are

calculated based on the number of units that were in use the previous

year. The annual maintenance cost equals $8,860 ($20 per kit x 443

kits) for all kits (active and spares) in 1997.

Historical data on part 121 airplanes shows one medical emergency

for every 124,647 passenger enplanements. The FAA assumes that the

medical emergency rate is the same on 20-to-30-seat airplanes since

all air carriers serve the same base population. The FAA estimates 70

medical emergencies in 1996 and 77 medical emergencies in 1997. A

physician consultation will be required twice a year per air carrier

to obtain certain contents, such as prescription drugs, for the

medical kits at a cost of $500 per consultation. In 1996, for the 20

projected air carriers, total consultations will total $20,000.

Record keeping will be needed per medical emergency; it will take one

hour to write up each emergency. At $20.58 per hour, in 1996, record

keeping costs will total $1,433.

In the NPRM, the FAA assumed that the medical kits could be

secured and installed with industrial strength Velcro tape. The FAA

still believes that securing these kits with Velcro (a low cost

option, at $20 per kit plus two hours for a Maintenance worker at

$20.58 per hour) will meet the 18-G requirement. Also, airplane

manufacturers will need to spend $1,500 for each make and model to

account for the design and administrative costs involved with securing

these kits and to comply with FAA regulations; with 8 makes and

models, this totals $12,000. This cost will be spread across the

entire population of each make and model.

Section 121.309 - First Aid Kit. This section will require 10-

to-19-seat airplanes to have at least one first aid kit. Currently,

part 135 requires all airplanes with greater than 19 seats to have one

kit, but there is no requirement for airplanes with 10 to 19 seats to

have a kit.

The 15-year cost of this requirement will be $371,400 ($267,400,

present value). The costs of providing first aid kits are composed of

acquisition ($70 each based on industry survey) with a 35 percent

spares reserve, installation, annual replacement rate (5 percent of

total), a weight penalty (4 pounds), engineering and administrative

costs, and annual maintenance ($7 per kit). Costs are a function of

the 10-to-19-seat airplane count, which ranges from 673 in 1996 to 543

in 2010.

Section 121.309 - Halon Fire Extinguisher. This section will

require commuter operators of 10-to-30-seat airplanes to replace

existing or install fire extinguishers (2 per 10-to-30-seat airplane

(one in cabin and one in cockpit) with halon fire extinguishers. For

this analysis, the FAA assumes that no part 135 airplanes are

currently equipped with halon fire extinguishers. Since part 135

airplanes are already equipped with fire extinguishers prior to

complying with part 121 standards, there will be no additional

maintenance costs or weight penalties for this equipment.

The 15-year cost of this requirement is $442,900 ($346,500,

present value). The cost of this provision will involve purchasing

the requisite number of halon fire extinguishers per airplane in 1996,

a 13 percent spares reserve ratio, and a 5 percent recharge rate per

year after 1996, and up-front administrative costs.

Section 121.549 - Flashlight. This section will require commuter

operators of 20-to-30-seat airplanes to acquire two additional

portable flashlights for use by the flight attendant and the copilot.

This section will also require 10-to-19-seat airplanes to acquire one

additional portable flashlight for use by the copilot. The analysis

assumes that no part 135 airplanes with 10-to-30 seats are equipped

with portable flashlights. Based on a recent survey, a portable

flashlight costs $5 and 2 D alkaline battery cells cost $2.25.

The 15-year cost of this requirement will be $134,400 ($82,000,

present value) broken out between $56,500 for 10-to-19-seat airplanes

and $77,900 for 20-to-30-seat airplanes. The cost of this provision

will involve purchasing the requisite number of flashlights for

airplanes in 1996 and for airplanes added to the fleet through 2010,

10 percent spares, 5 percent replacement rate for every year after

1996, and a weight penalty (1 pound per flashlight). The analysis

also assumes that all batteries will be replaced each year.

Section 121.313 - Cockpit Key. This section will require all

required crewmembers of affected operators to have access to a key for

the locking cockpit door. This lock and key requirement will provide

additional security for equipment and instruments in the cockpit.

This requirement only applies to 20-to-30-seat airplanes. Airplanes

with 10 to 19 seats are not required to have locking cockpit doors and

will not be affected by this requirement. The rule will require 20-

to-30-seat airplanes to retrofit the cockpit door with a lock and copy

a key ($1 per key). If an airplane does not have a lock, then the

operators will be required to install one.

The 15-year cost is $102,900 ($78,500, present value). The

highest yearly cost ($51,245) will occur in 1996 when all of the 277

20-to-30-seat airplanes will have their cockpit doors retrofitted with

locks and keys. Subsequent yearly costs are based on the annual

increase in airplanes. Hence, in 1997, with 30 new airplanes, costs

total $5,550 ($90 for new keys + $5,460 for door retrofit costs).

Section 121.333 - Portable Oxygen. This section will require

airplanes that are certificated to fly above 25,000 feet to have a

portable oxygen unit for each flight attendant. This requirement will

only apply to commuter airplanes having more than 19 seats. This is

because currently no 10-to-19-seat airplanes in commuter operations

are certificated to fly above 25,000 feet.; also, 10-to-19-seat

airplanes are not required to have flight attendants on board. Of the

249 20-to-30 seat airplanes in 1995, 146 fly over 25,000 feet.

The 15-year cost to equip all affected 20-to-30-seat part 135

airplanes will be $472,900 ($299,200, present value). Costs primarily

are composed of $400 per oxygen unit and weight penalty.

Parts 121.333, 121.571, 121.573 - Passenger Information. New

cards will have to be prepared for 20-to-30-seat airplanes. Industry

experience has shown that each card has a lifetime of approximately 3

years. Thus, every year, only one-third of the cards will normally be


The 15-year cost for the preparation of these cards will be

$125,000 ($72,300, present value). Each air carrier having 20-to-30

seat airplanes (20 in 1996 growing to 39 in 2010) will incur

preparation costs and will then need to prepare enough passenger

information cards for all airplanes in its fleet. Preparation costs

involve two people two hours each: a flight attendant supervisor

($24.19 per hour) and a paperwork layout specialist ($20.58 per hour).

There will be no training costs, as the flight attendant could read

the new passenger information material directly from the manual.

Based on an industry survey, the FAA assumes that it costs $1 to print

and distribute each information card; a total of 5,353 cards will need

to be produced in 1996.

Section 121.337 - Protective Breathing Equipment (PBE) for the

Cabin. This section requires a fire fighting PBE unit in the cabin on

all 20-to-30-seat airplanes. The 15-year costs to supply all 20-to-

30-seat airplanes total $936,800 ($595,600, present value). Costs are

composed of PBE acquisition ($400 per unit) with a 40 percent spares

reserve ratio, installation (two hours of mechanic labor), engineering

and administration costs, a 5 percent replacement rate per year,

annual maintenance ($40 per unit performed annually), and a weight

penalty (5 pounds per unit, one unit per airplane).

Section 121.339 - Life Rafts. This section requires all affected

commuters conducting extended overwater operations to carry an

additional life raft. The 15-year cost to equip the affected

airplanes with an additional life raft will be $265,100 ($183,800,

present value).

Section 121.340 - Flotation Cushions and Life Vests. This

section requires operators to provide a flotation cushion or life vest

for each passenger seat on each airplane. In 1995, 10-to-19-seat

airplanes average 18.66 seats per airplane and 20-to-30-seat airplanes

average 28.99 seats per airplane. In this analysis, the FAA assumes

that these ratios remain constant into the future.

The 15-year cost for providing flotation cushions or life vests

on 10-to-30-seat airplanes will be $7.50 million ($5.53 million,

present value) composed of $5.03 million for 10-to-19-seat airplanes

and $2.47 million for 20-to-30-seat airplanes. The FAA assumes that

10-to-19-seat airplanes will not be able to install flotation cushions

and hence will obtain life vests. In addition, even though some

airplanes may have flotation cushions currently installed, the

analysis assumes that all operators of 20-to-30-seat airplanes will

replace existing seat cushions with flotation cushions. Data from

industry sources place the same cost and weight on both items: $50 and

2 pounds each. As the current seat cushions weigh the same amount,

there will not be a weight penalty on the 20-to-30-seat airplanes.

The total number of life vests and cushions per year is derived by

multiplying the number of seats per airplane times the projected

airplane count for the 10-to-19-seat and 20-to-30-seat airplane


Section 121.391 - Flight Attendants At The Gate. This section

requires a flight attendant or other authorized person to stay on the

airplane during intermediate stops while passengers are on board. The

final rule adopts new section 121.393(a) for 10-to-19 seat airplanes

to allow crewmembers (not necessarily a flight attendant) to stay near

the airplane.

The only costs imposed on operators, as a result of this rule

will be the training and documentation of authorized substitute

personnel. Based on information received from FAA technical

personnel, there will be no additional crewmember personnel costs for

flight attendants or other crewmembers at the gate requirement due to

the delay. In the NPRM, the FAA attributed additional compensation

costs to operators in the event of a flight delay due to additional

time spent by personnel to monitor passengers. FAA technical

personnel state that delay costs are a result of the air carrier

operations system and not the final rule. The air carrier operations

system currently compensates any additional personnel costs due to


Individual operators can comply by having a flight crewmember

near the airplane (no cost) or by following one of three scenarios.

Under the first scenario, operators could require all passengers to

deplane during intermediate stops at the gate. Because deplaning will

cause inconvenience to the passengers, air carriers will not use this

option all the time. The FAA acknowledges that the deplanement of

passengers under this scenario may impose some cost on passengers in

the form of inconvenience; however, the FAA is unable to quantify this

cost. Under the second scenario, operators can require either a

flight attendant or pilot to remain on the airplane at intermediate

stops as long as passengers are on board. Generally, the 20-to-30

seat airplanes will use a flight attendant, while 10-to-19 seat

airplanes will use a pilot. Under the third scenario, operators can

allow a trained, authorized person to stand in for the flight

attendant or pilot when coverage is needed due to flight delay. Not

all air carriers have authorized personnel at all intermediate stops;

this will put a cap on the amount of time that this option will be

used. This third scenario will require 24 hours of training for each

authorized person ($16.48 per hour) and documentation of personnel

records by a clerical worker (paid at $11.00 per hour for one hour of

work per record). In the NPRM, the FAA assumed that non-Alaska

operators would use the third scenario 20 percent of the time, and the

FAA is keeping this percentage. Based on industry sources, the FAA

does not believe it is very likely that air carriers in Alaska will

have trained substitute personnel waiting at the intermediate stops to

be used in the event that the airplane is delayed; thus, the third

scenario will not be used. Currently, 88.4 percent of all 20-to-30

seat airplanes and 91.9 percent of all 10-to-19 airplanes fly in areas

other than Alaska, and this analysis projects these percentages into

the future.

The 15-year cost for training and documentation of authorized

personnel in areas other than Alaska on 10-to-30-seat airplanes will

be $20,500 (present value, $12,700). This cost is the summation of

the 10-to-19-seat airplane cost and the 20-to-30-seat airplane

category cost. The cost for the 10-to-19-seat category is derived by

multiplying the total 15-year cost for training and documentation

($67,500) by the expected probability of occurrence for the third

scenario (20%) and then multiplying by the percentage of the fleet not

operating in Alaska (91.9%). The cost for the 20-to-30-seat category

is derived by multiplying the total 15-year cost for training and

documentation ($45,500) by the expected probability of occurrence for

the third scenario (20%) and then multiplying by the percentage of the

fleet not operating in Alaska (88.4%).

3. Certification

This section examines the costs of the rule with regards to

airplane certification and performance. The total 15-year costs for

certification are $11.49 million with a present value of

$6.58 million.

Part 121 Subpart I: Performance Criteria. In the NPRM, the FAA

had stated its belief that all of the commuter airplanes would be able

to meet the part 121 performance standards. Consequently, the only

compliance cost would be a manufacturer's one-time recertification

cost of $5,000 per airplane. However, after additional FAA analysis

and input from several commenters, the FAA realizes that some of these

airplanes are not able to meet the part 121 performance standards.

Further, there will be an enormous economic impact if the proposed

rule were to be adopted for all commuter airplanes.

Airplanes operating under part 121 face stricter performance

requirements than those faced by airplanes operating under part 135.

Part 135 performance requirements allow greater gross take-off weights

for a given runway length and, conversely, allow a shorter runway for

a given gross take-off weight than are allowed under part 121 for high

altitude and/or high temperature conditions. However, as airplane

models' performance capabilities differ, a change in performance

requirements has a different effect across airplane models.

For example, the SFAR 41 and predecessor category commuter

airplane performance capabilities are such that compliance with the

part 121 performance requirements would require them to offload so

many passengers or cargo as to become unprofitable to operate in

scheduled passenger service. Due to the potential substantial

economic loss and the potential safety reduction that would result

when many of these airplane operators substitute airplanes with fewer

than 10 passenger seats for these airplanes, the FAA decides that they

will have 15 years to meet the part 121 performance requirements. By

allowing these airplanes to remain in scheduled passenger service,

their operators will have a sufficient amount of time to profitably

exploit these airplanes, to plan their replacement, and to reduce the

potential impact on the resale price in other uses of these airplanes.

In addition, this 15-year period will provide an opportunity for

manufacturers to develop future airplanes that may be better

substitutes than the current available substitute airplane models.

Further, this 15-year allowance will reduce the tendency for many of

these operators to substitute smaller airplanes with less than 10

seats. These airplanes have an accident rate 14 times that of 10-to-

15-seat commuter airplanes. Nevertheless, some of these airplanes

will be phased out of scheduled passenger service before they would

have been phased out if there were no commuter rule.

Currently, there are 112 pre-SFAR 41 commuter airplanes in part

135 scheduled service. As the FAA was unable to directly obtain the

ages of these airplanes, the FAA used a data source to construct an

approximate age-profile distribution for each of these airplane models

and then assigned the appropriate number of airplanes to individual

years based on those distributions. The FAA determines that, due to

the increasing maintenance costs as airplanes age, the economic

lifespan of these airplanes in scheduled passenger service is 30 years

for the Twin Otter and 25 years for all of the other models. On that

basis, the FAA projects that, in the absence of the commuter rule, 4

of these airplanes would still be in scheduled passenger service after

15 years.

Finally, these airplanes' market values will fall over time

because the airplane ages because it takes an increasing level of

expenditure on maintenance and replacement to keep the airplane

airworthy for scheduled passenger service. Currently, the average

market values for the pre-SFAR 41C airplanes are $500,000 for the Twin

Otter and the EMB-110; $350,000 for the Beech 99; and $250,000 for the

SA-226 and the Beech 200.

In light of those factors as they relate to the pre-SFAR 41

airplanes, the FAA determines that a one-year compliance date would

generate a 60 percent loss in these airplanes' average market values

and this percentage loss is reduced by 2.5 percentage points per year

for four years (e.g., the second year would have a percentage loss of

57.5 percent, the third year will be 55 percent, etc.) and by 5

percentage points per year thereafter. Thus, the percentage loss of

the market value of these airplanes in 15 years will be 5 percent of

that airplane's market value. On that basis, the FAA determines that

in 15 years these airplanes will incur a reduction in market value of

$56,000 ($20,000, present value).

SFAR 41 airplane models would also be affected by the part 121

performance criteria because these criteria are stricter than those in

part 135. However, the part 121 performance requirements are very

similar to the performance requirements in the ICAO Annex 8 flight

operating requirements - the flight operating requirements under which

these airplanes must fly in European scheduled service. As all of

these airplanes are used in European scheduled service, they can

comply with the part 121 performance requirements, but at a potential

payload loss. There are some combinations of temperature, airport

elevation (pressure altitude) and airport runway length that would

require SFAR 41C airplanes either: (1) to unload one, two, or even

three passengers from the currently permitted part 135 gross take-off

weight; or (2) to operate out of airports with longer runway lengths

in order to meet the ICAO Annex 8 performance requirements. For

example, the minimum runway length for a Beech 1900-C airplane with a

16,600 lb. maximum takeoff weight (its maximum certificated load) from

a pressure altitude of 1,000 ft. (a typical Midwestern airport) at 13

degrees Centigrade (standard day) would be 4,700 ft. under part 135

but would be 5,900 ft. under ICAO Annex 8. From another perspective,

in order for a Beech 1900-C to operate under ICAO Annex 8 from an

airport with a 4,700 ft. runway, the maximum allowable takeoff weight

would be 14,900 lbs. in comparison to the 16,600 lbs. allowable under

part 135. One commenter reports that these operating limitations may

affect these SFAR 41 airplanes at as many as 65 airports at some point

during the year. Nevertheless, for most of the temperatures, airport

elevations (pressure altitude), runway lengths, and actual takeoff

loads faced by these airplanes, the part 121 performance requirements,

ICAO Annex 8 rules, and the part 135 performance requirements would

have the same limiting effect on these airplanes' operations.

As a result, the FAA will allow SFAR 41 and predecessor category

airplanes 15 years to comply with the part 121 performance

requirements. With a 15-year time horizon, operators will be able to

organize their schedules (for example, departing high temperature

airports earlier in the morning), their airplane/airport pairings,

etc. such that the costs in 15 years will be minimal.

Finally, the commuter category airplanes have the performance

capability of meeting part 121 performance requirements. However, the

manufacturers will need to document these capabilities for the

approved flight manuals. This documentation will require about 20

hours of flight time at a per hour cost of $1,500 (includes instrument

calibration, engineering analysis, ground personnel review, etc.) for

a total cost of $30,000 per type certificate. In addition, there will

be a one-time manufacturer's cost of $5,000 per type certificate to

obtain FAA approval for this flight manual revision. Thus, the one-

time first-year cost for commuter category airplanes will be $105,000.

Section 121.161(a) - Airplane Limitations: Type of Route.

Section 121.161(a) requires that an adequate airport be within one

hour flying time at single engine cruising speed along all points of

the designated flight route. There is no similar requirement in part

135. This requirement is not expected to affect scheduled operators

in the lower 48 states. In the Regulatory Evaluation for the NPRM,

the FAA had estimated that 150 round-trip flights in Alaska would be

affected annually, with reroutings adding one-half hour to each round-

trip, for a total of 75 hours increased flying time. Applying an

hourly variable operating cost for Alaskan air carrier commuter

category airplanes of $500, the FAA had estimated that annual

operating costs would increase $37,500. The 15-year total costs would

be $375,000 ($265,000, present value). As no comments were made on

the estimated costs of this provision, the FAA affirms its previous

calculations. However, carrying them out for 15 years generates a

cost of $570,000 ($346,000, present value).

Section 121.191 Engine Out En Route Net Flight Data. Although

the FAA had not estimated a compliance cost for this provision in the

Regulatory Evaluation for the NPRM, three commenters report that these

data do not currently exist for 10-to-19-seat airplane models and

there is a cost to developing these data. Based on those comments,

the FAA determines that manufacturers' will incur a one-time first-

year cost of $1,900 per type certificated model, resulting in a one-

time first-year compliance cost of $24,700 for the 13 type-

certificated airplanes.

Section 121.305(j) - Third Attitude Indicator. This section

requires that a third attitude indicator be retrofitted on all

affected airplanes (manufactured before March, 1997) within 15 years

of the rule's effective date. Any affected airplane manufactured

after March, 1997, must have the device. This device is not required

under part 135 or part 23.

In the Regulatory Evaluation for the NPRM, the FAA had estimated

that it would cost $16,000 for a retrofit that would add about 5 lbs.

of weight while the annual maintenance, inspection, and replacement

costs would be about 10 percent of the retrofitting costs. The FAA

had also estimated it would cost $8,000 for an installation on a

newly-manufactured airplane. The FAA had also determined that a third

attitude indicator is standard equipment on the Beech 1900-D. The

proposed rule had a 1-year compliance date. On that basis, the FAA

had estimated that the 10-year cost would be $19.2 million

($18.4 million, present value).

The FAA estimates that the retrofitting cost will be $16,000 and

will add 15 lbs. of weight to the airplane. To eliminate the

potential for down time, operators will retrofit this device during

one of the airplane's 200-hour scheduled checks. On that basis, the

FAA expects that this device will be installed in half of the 58 SFAR

41C airplanes in scheduled passenger service during the 13th year and

in the remaining half during the 14th year. On that basis, the FAA

determines that the 15-year compliance cost will be $319,000

($116,000, present value).

Section 121.308 - Lavatory Fire Protection . This section

requires each lavatory to have a smoke detector system connected to

either: (1) a warning light in the flight deck; or (2) a warning

light or an aural warning in the passenger cabin that can be readily

detected by a flight attendant. Section 121.308(b) requires each

lavatory to have a built-in automatic fire extinguisher in each of its

disposal receptacles. These requirements are also found in section

25.854 but only for airplanes type certificated after 1991. There are

no such provisions in part 135 or part 23.

On that basis, the FAA estimates that for the 20-to-30-seat

airplanes, there will be a first-year compliance cost of $78,000 and

an annual cost in each succeeding year of $45,000 to $58,000. The 15-

year total cost will be $858,000 ($519,000, present value). In the

Regulatory Evaluation for the NPRM, the FAA had estimated a 10-year

total cost of $263,000 ($206,000, present value).

Section 121.310(l) Flight Attendant Flashlight Holder. This

section requires an emergency flashlight holder be available to the

flight attendant. A flashlight holder is needed to keep the

flashlight available and within reach of the flight attendant seat.

This provision requires retrofitting within one year of the effective

date of the rule. The FAA had not estimated any compliance cost for

the flashlight holder in the Regulatory Evaluation for the NPRM.

However, after additional analysis, the FAA found that there will be a

per airplane cost of $50 for a retrofit and $25 for an installation on

a newly-manufactured airplane. It will increase the airplane's weight

by 2 lbs. In addition, there will be a one-time engineering design,

development, and FAA approval cost of $250 for each type certificated

model. As there are no flight attendants in 10-to-19-seat airplanes,

no flight attendant flashlight will be required and there will be no

compliance cost for those airplanes. For 20-to-30-seat airplanes, the

first-year cost will be $42,000 and the annual cost thereafter will be

between $2,000 and $6,000. The 15-year total cost will be $88,000

($68,000, present value).

Section 121.312(b) - Passenger Seat Cushion Fire Blocking

Materials. This section requires that 10-to-30-seat airplane seat

cushions comply with the fire protection standards in Section

25.853(b) within 15 years. The proposed rule had allowed a two-year

compliance period with an option for two additional years if there

were demonstrated compliance difficulties.

In the Regulatory Evaluation for the NPRM, the FAA had assumed

that this provision would affect only the 10-to-19-seat airplanes

because the 20-to-30-seat airplanes are type-certificated under part

25, which requires fire blocked seats for airplanes type-certificated

after 1991. As those airplanes are used in both part 121 and part 135

service, the FAA believed that they have already been retrofitted and

are being manufactured with fire blocking cushions. As there were no

comments to the contrary, the FAA has retained that assumption.

In the Regulatory Evaluation for the NPRM for 10-to-19-seat

airplanes, the FAA had estimated that it would cost $20,000 for a

retrofit, $5,000 for installation on newly-manufactured airplanes, and

fire blocking would add 2 lbs. per seat cushion. In addition, the FAA

had believed that the incremental compliance costs from replacing a

fire-blocked cushion with another fire-blocked cushion (due to normal

wear and tear) would be only due to the difference in the costs of the

fire-blocking material, which was estimated to be $5,000. There would

be no incremental labor costs because it would take as long to replace

a fire-blocked cushion with a fire-blocked cushion as it would take to

replace a non-fire-blocked cushion with a non-fire-blocked cushion.

The FAA had also estimated that 10 percent of the 10-to-19-seat

airplanes have fire blocked seats because they are offered as an

option on currently manufactured models. Further, the FAA had

estimated that it would cost $50,000 for engineering, developing,

testing, and documenting the results for FAA approval for those

airplanes no longer in production. Finally, allowing operators four

years to comply means that they can schedule this retrofitting to fit

into the normal cushion reupholstery schedule. Consequently, the

existing cushions would not have been prematurely replaced before they

would have been replaced due to normal wear and tear.

Based on information received from industry, the FAA estimates

that the average retrofitting cost (weighted by the number of each

type of airplane model in the existing fleet) will be $21,500 and the

average new-installation cost (weighted by the number of new airplanes

projected to be sold by each manufacturer) will be $4,875. The

average weight of 38 lbs. (for a 19 seat airplane) results in a yearly

per airplane fuel cost of $105. In addition, an industry source

reports that airplane operators normally reupholster their seat

cushions every four years. Further, the FAA estimates that there will

be no engineering costs for current commuter category airplanes

because all of the manufacturers offer the fire blocked seat cushions

as an option and the engineering and FAA-approval costs have already

been incurred. However, the FAA revises its engineering costs for

each out-of-production airplane model from $10,000 to $5,000 because

there are a sufficient number of fabrics that have been approved so

that each manufacturer will not have to completely reengineer its


In response to the increase in time (from 4 years to 15 years) to

comply with the rule, the FAA assumes that no airplane that will be

withdrawn from scheduled-passenger service during those 15 years will

be retrofitted with fire-blocking-seat-cushion materials. Further, an

operator of an existing airplane that will be employed in scheduled

passenger service beyond the 15-year period will wait until the last

moment (13 to 14 years) before performing the retrofit. Based on

industry statements, commuter-category airplanes are being built with

the expectation of a 25-to-30-year lifespan. Also based on industry

statements, the initial cost (plus one or two cushion reupholsteries)

is less than or about the same as a retrofit 10 or fewer years in the

future. The FAA anticipates that beginning in 5 years, operators will

only purchase new airplanes that have factory-installed-fire-blocked

seat cushions. Over time, the compliance costs will increase because

a greater number of these airplanes will carry the extra 38 lbs. of

weight. On that basis, the annual compliance costs will begin at

$150,000 in the sixth year after the effective date and increase to

$1.25 million by the 13th year. The 15-year total will be $5.88

million ($2.55 million, present value).

Section 121.317(b) - Fasten Seat Belt Lighted Sign . This

section requires that there be a lighted "fasten seat belt" sign that

can be controlled by the pilot. In the Regulatory Evaluation of the

Proposed Rule, the FAA had not estimated any compliance costs because

it was believed that affected airplanes had these lighted signs.

Based primarily on information received from industry, the FAA

estimates that the total 15-year cost for the 2 lb. device will be

$522,000 ($269,000, present value).

Section 121.342 - Pitot Heat Indication System. This section

requires all affected airplanes, within 4 years of the rule's

effective date, to have a pitot heat indication system that indicates

to the flight crew whether or not the pitot heating system is

operating. Section 23.1323 requires a pitot heat system for most

commuter category airplanes, but there are no requirements for a heat

indication system.

In the Regulatory Evaluation for the NPRM, the FAA estimated a

per airplane cost of $500 for a retrofit and $250 for installation on

a newly-manufactured airplane. The FAA did not estimate a weight

penalty or costs for inspection, maintenance, and repair, but it had

estimated a one-time manufacturer cost of $10,000 for initial

engineering design, testing, and documentation for FAA approval. On

that basis, the FAA had estimated that the compliance cost during each

of the first four years would be $280,000 and $10,000 per year

thereafter. The 10-year total costs were estimated to be $1.184

million or $993,000, present value.

After additional analysis, the FAA is persuaded that its initial

cost estimates need revision. Based on its analysis of the technology

required to install these devices, the FAA determines that there is a

per airplane cost of $4,000 for a retrofit and $2,000 for installation

in a newly-manufactured airplane. However, the number of airplanes

expected to be sold by the manufacturer who reported this device is

standard equipment is subtracted from the expected number of newly-

manufactured airplanes that will need to install this device. In

addition, the associated equipment and wiring will add 5 lbs. to the

airplane. Finally, there will be a $10,000 one-time cost to engineer,

design, test, and obtain FAA approval for the manufacturer of each

type certificate.

On that basis, the annual costs in each of the first 4 years will

be between $515,000 and $535,000 and the annual costs in each year

thereafter will be between $17,000 and $23,000. The 15-year total

costs will be $2.29 million ($1.87 million, present value).

121.349(c) Distance Measuring Equipment. This section requires

at least one approved distance measuring equipment (DME) unit within

15 months of the final rule publication date for operations under

VFR over routes not navigated by pilotage or for operations under IFR

or over-the-top. The FAA had estimated no compliance costs for this

provision and there were no comments on this provision. After

additional analysis, however, the FAA determines that some airplanes

are affected by this requirement.

Based on the 1994 AOPA Pilot General Aviation Aircraft Directory

and Avionics Directory and Buyer's Guide, the FAA estimates that the

average price of a 25 lb. DME for an airplane is $7,000 and it will

cost another $7,000 to retrofit for a total cost of $14,000. The FAA

General Aviation and Air Taxi Activity and Avionics Survey for 1993

reports that 3.1 percent of the turboprops in service (twenty-three

10-to-19-seat airplanes and ten 20-to-30-seat airplanes) do not have

this device but that all newly-manufactured airplanes will have this

device installed. On that basis, the FAA estimates that the first-

year-compliance cost is $434,000 ($294,000 for 10-to-19- and $140,000

for 20-to-30-seat airplanes) and the 15-year-compliance cost is

$452,000 of which $303,000 is for 10-to-19-seat airplanes and $149,000

is for 20-to-30-seat airplanes ($418,000, present value of which

$281,000 is for 10-to-19-seat airplanes and $137,000 is for 20-to-30-

seat airplanes).


The FAA estimates that over the 15-year period, the total cost of

compliance for the relevant maintenance sections affected by the final

rule will amount to an estimated $18.18 million ($11.92 million,

present value). A discussion of the individual maintenance costs is

presented below.

Section 121.361 Applicability. The final rule requires all

affected commuter operators to have an airplane maintenance program

that is appropriate for part 121 operations. All part 135 commuters

currently operating under a part 135 continuous airworthiness

maintenance program (CAMP) will be required to revise and possibly

upgrade their programs in accordance with the new part 121 standards.

Currently, commuter operators of airplane type-certificated with a

passenger seating configuration of 10 seats or more operate under a

CAMP as specified in section 135.411(a)(2). Most differences among

the respective part 135 operators' CAMP's arise from the varying

complexity of the different airplanes, not solely from the type of

operation. Therefore, the only new requirement will be to revise and

possibly upgrade part 135 operators' existing CAMP's, not to develop

entirely new maintenance programs.

The FAA estimates the one-time total compliance cost of the

maintenance applicability section is $104,000. Of this total, $63,000

will be incurred by operators of 10-to-19-seat airplanes and $41,000

will be borne by operators of 20-to-30-seat airplanes. The FAA

assumes, based on information received from its technical personnel,

that an average of 80 hours will be required of each affected

operator's maintenance shop foreman to review an operators' CAMP to

ensure compliance with the final rule. Assuming a loaded hourly wage

of $20.58 for a maintenance foreman, the one-time cost estimate for

each operator will be approximately $1,650 (80 x $20.58).

Section 121.377 Maintenance And Preventive Maintenance Personnel

Duty Time Limitations. The final rule will require all commuter

operators to adhere to the part 121 limitation of time that

maintenance and preventive maintenance personnel can be required to

remain on duty. Section 121.377 requires maintenance personnel to be

relieved from duty for a period of at least 24 consecutive hours

during any 7 consecutive days, or the equivalent thereof within any

one calendar month. Maintenance and preventive maintenance personnel

employed by part 135 operators have no such duty time limitation.

The FAA maintained in the NPRM that simple adjustments in work

scheduling or duty requirements of maintenance personnel were on-going

costs of doing business which would not be affected by the commuter

rule. Furthermore, the FAA held that the existence of union work

rules, Department of Labor regulations and the generally accepted

notion of a "day of rest" would be sufficient to limit the amount of

time that part 135 maintenance and preventive maintenance personnel

remained on duty. The FAA, therefore, did not estimate any

incremental costs associated with this section, and treated it as one

not contributing to the total maintenance costs.

For the final rule, in considering the unique operating

environment of Alaska, the FAA has determined that imposing the

requirements of the maintenance and preventive-maintenance-personnel-

duty-time limitations for part 121 operators onto part 135 operators

will be a cost factor. The cost for the Alaskan operators is $312,000

per year for all Alaskan 10-to-19-seat airplane operators. This cost

estimate was provided by the Alaskan Air Carriers Association (AACA)

and adopted by the FAA for this analysis. For the remaining

operators, the annual cost is an estimated 80 hours per year at $20.44

per hour for the maintenance foreman to perform the additional

scheduling necessary to comply with the rule. The FAA estimates that

a maintenance foreman will spend approximately 80 additional hours per

year to meet the part 121 standards. Thus, the cost for non-Alaskan

10-to-19-seat operators in 1996 will be 23 operators x $20.58 x 80

hours or $37,870. For 20-to-30-seat seat operators, the cost in 1996

will be 25 operators x $20.58 x 80 hours or $41,000. The calculations

would be the same in subsequent years.

Over the 15-year period, the total cost imposed due to the new

duty-time-limitation requirement will be approximately $6.02 million

($3.65 million, present value). Most of this cost, $4.68 million,

falls on Alaskan part 135 operators of 10-to-19-seat airplanes. This

disproportionate amount reflects the probable added labor requirements

of Alaskan operators owing to the uniqueness of the Alaskan operating


Section 121.380 Maintenance Recording Requirements. This section

provides for the preparation, maintenance, and retention of certain

records using the system specified in the certificate holder's manual.

It further specifies the length of time records must be retained and

the requirements for records to be transferred with the airplane at

the time the airplane is sold. Section 121.380a, Transfer Of

Maintenance Records, develops the transfer of records in more detail.

It requires the certificate holder to transfer certain maintenance

records to the purchaser, at the time of sale, in either plain

language or coded form which provides for the preservation and

retrieval of information. The section ensures that a new owner

receives all records that are to be maintained by an operator as

required under section 121.380.

In the NPRM, the FAA maintained that because section 135.439 was

essentially identical to 121.380, there would be minimal new

recordkeeping requirements imposed on part 135 operators and thus,

assumed no incremental costs would result from changes to this

section. The FAA also maintained that there would be no incremental

cost impact resulting from changes to part 121.380a. Upon review of

the proposal and subsequent comments received, the FAA has determined

that the merging of the recordkeeping requirements of sections 121.380

and 135.439 brought on by the commuter rule will involve incremental

administrative costs. The FAA therefore, has revised its NPRM position

of no costs, and estimated the administrative costs for the new

requirements incorporated in the changes to sections 121.380, 121.380a

and 135.439.

The cost was derived from averaging the total recording cost for

Alaskan commuter airplanes as provided by the AACA and applied to the

total 10-to-19-seat airplane fleet. The AACA estimated the total

first-year cost for Alaska operators to be $156,000. This was divided

by the number of 10-to-19-seat airplanes in Alaska (44) for an average

cost of $3,545 per airplane. This was then multiplied by the total

number of airplanes in the 1996 U.S. fleet. In 1996, the number of

airplanes will be 629 (673-44), 44, and 277 for 10-to-19-seat non-

Alaska airplanes, 10-to-19-seat Alaska airplanes, and 20-to-30-seat

airplanes respectively. For subsequent years, the additional

reporting cost will be $26,000 for the 10-to-19-seat airplanes in

Alaska. The FAA divided that cost by the number of Alaskan airplanes

(44) and then multiplied it by the total U.S. fleet. Thus, in 1997

the fleet count is 639 (683-44) 10-to-19-seat non-Alaska airplanes and

307 20-to-30-seat airplanes. The total costs for 1997 are $26,000 for

Alaska, $377,590 ($26,000/44 x 639) for 10-to-19-seat non-Alaska, and

$181,409 ($26,000/44 x 307) for 20-to-30-seat airplanes. The same

procedure is used for the remaining years. The total cost imposed on

operators of part 135 airplanes due to the additional recordkeeping

required to merge parts 121 and 135 maintenance recording requirements

is approximately $11.5 million ($7.8 million, present value) for the

15-year period.

As a final point, this rule will impose costs on some part 121

operators by requiring them to maintain information on engine and

propeller time in service as specified in section 135.439/121.380.

The FAA concurs with a commenter's objection that for the few

operators of older, part 121 propeller-driven airplanes, this will

necessitate a substantial search-cost for historical records. In this

instance the costs will not be borne by part 135 operators who, for

the most part, utilize propeller-driven airplanes, but rather, by a

few part 121 operators who do not utilize jet-driven airplanes.

However, in the final rule, the FAA will make this requirement

prospective only; those part 121 operators of propeller-driven

airplanes will be required to maintain information on engine and

propeller time in service only from the date of the first overhaul of

the engine or propeller as applicable. Thus, this new requirement

should only impose negligible costs on these part 121 operators.

5. Part 119

Part 119 is a new part that consolidates the certification and

operations specifications requirements for persons who operate under

parts 121 and 135. Most of these regulations are currently in SFAR

38-2; therefore, moving them to part 119 would not impose any

additional cost. However, some sections currently under parts 121 and

135 would be moved to part 119. The costs imposed on affected

operators by those sections are presented below. Over 15 years, the

costs of these provisions are estimated to be $3.36 million

($2.30 million, present value).

Sections 119.33(c) and 121.163 - Proving Tests. When an operator

changes the type of operation it conducts or purchases an airplane

that is new to a certain type of operation, that operator must

undertake a proving test. A proving test generally consists of a non-

passenger flight in which the operator proves that it is capable of

safely conducting that type of operation or airplane. Going from a

part 135 operation to a part 121 operation would be a change in

operation and be subject to a proving test. Under the final rule,

there would be two costs associated with proving tests--initial and

recurring. The initial cost would be proving tests for upgrading the

existing part 135 fleet that would become part 121. The recurring

costs would be for any future operational or airplane changes that

would normally require a proving test( as required by the existing


The current regulation prescribes 50 hours of flight for a part

121 (section 121.163(b)(1)) proving test. This is the number that

part 135 operators switching to part 121 will be subject to. However,

the current rule also allows for deviations from the 50-hour

requirement. A sample of FAA records on proving tests shows that,

since 1991, there has been a wide range of hours actually flown for

proving tests. This is because the amount that the operator is

allowed to deviate from the prescribed number of hours is based on

what that operator requests and on what the FAA will allow. However,

based on the above sample, the FAA assumes for the purposes of this

analysis that the average deviation will be down to a total of 15


The FAA recognizes that some operators who currently operate

under a split certificate already have experience operating under part

121. Also, some part 135 operators already voluntarily comply with

part 121 requirements for much of their operation. To the extent

practicable, for these and possibly other operators, the FAA will not

require a proving flight. However, some operators who will have to

make significant changes to the operation as a result of the final

rule will have to have a proving flight. The FAA anticipates that 50

percent of the estimated number of proving tests will not have to

include a proving flight. The only cost to these operators will be

the preparation and completion of the test for the dispatch system.

For this analysis, the FAA assumes three days preparation for the

manager, maintenance director, and secretary.

For those operators who must take the proving test, the cost will

be the same three days preparation plus the 15 hours of flight time.

The FAA estimates that the 15 hours of proving test flights will cost

the operator approximately $8,560 for a 20-to-30-seat airplane and

$7,000 for a 10-to-19-seat airplane. The difference in cost is due to

the flight attendant being on board in the 20-to-30-seat airplanes.

The FAA estimates that there will be 90 proving tests necessary

1n 1996 to bring the existing fleet up to part 121 standards (assuming

a proving test for each type of airplane for each part 135 carrier

affected by the final rule.) The cost to the 60 part 135 operators in

1996 to complete the initial 90 proving tests would be approximately

$393,660 ($367,900, present value). Of this cost, approximately

$128,300 would be incurred by operators with 20-to-30-seat airplanes

and $265,360 by operators with 10-to-19-seat airplanes.

The recurring costs would accrue over the next 15 years as

affected operators conduct part 121 proving tests instead of part 135

proving tests. If the prescribed number of hours for part 135 and

part 121 operators is 25 and 50 respectively, and the average

deviation is 50 percent, then the difference in hours would be 13

[(50-25) x .5]. Also, the FAA found from the survey of its records

that, on average, operators conduct one proving test every four years,

which equates to approximately 3 tests over the 15-year period.

The average number of operators in any given year over the next

15 years is 68. Based on this, the FAA will conduct approximately 14

((68 operators x 3 tests)/15 years) proving tests annually: 8 for 10-

to-19-seat airplanes and 6 for 20-to-30-seat airplanes. The FAA

estimates that the increased cost of a proving test per part 135

operator would be $6,050 for a 20-to-30-seat airplane and $5,800 for a

10-to-19-seat airplane. For all affected operators, the final rule

will impose approximately $82,700 annually in additional costs for

proving tests. Over the next 15 years, the total recurring cost of

this provision would be $1.24 million ($0.75 million, present value).

Sections 119.65, 119.67, 119.69, and 119.71--Directors of

Maintenance, Operations, and Safety; Chief Inspector; and Chief Pilot.

The existing requirements for establishing and the eligibility of

management personnel only apply to part 135 operators (excluding those

that use only one pilot) and supplemental and commercial part 121

operators. The final rule will expand the applicability of the

requirement for management positions to all part 121 operators as

well. However, the FAA contends that part 121 operators, by the very

nature and size of their operations, already have personnel in these

positions (or the equivalent of these positions). Thus, there will be

no cost to incorporate part 121 operators under these requirements.

There are three other potential cost areas for the management

positions required in the final rule. First, is the new recency of

experience for first time Directors of Operations and Maintenance.

Second, is the new Director of Safety position for both part 121 and

part 135 operators. Third is the Chief Inspector, which will be a new

position for those part 135 commuters who upgrade to part 121.

Recency of Experience. The final rule will impose new recency of

experience requirements for those Director of Maintenance and

Operations candidates who will have that title for the first time. In

addition to other requirements, these candidates will have to have

three years of experience (within their respective fields) within the

past six years to be eligible for a Director position. This will

ensure that those candidates who do not have any experience as a

Director at least have recent on-the-job experience in their

respective fields.

The potential cost of the recency of experience requirement is

the reduction at any given time in the number of first-time candidates

available for these positions. This is because some first-time

candidates may have to acquire additional years of experience if they

do not have it at the time that they are being considered for a

Director position. It is extremely difficult to project how many

future first-time Director candidates will be affected by the final

rule. However, this will have little if any affect on an operator's

ability to find potential applicants to fill a Director position.

This is for three reasons. First, the FAA contends that the number of

potential candidates who do not meet the recency of experience

requirement both now and in the future is small in relation to the

total number of potential applicants for a Director position. Second,

the FAA contends that the supply of existing personnel who would

qualify for a Director position, plus those who are already a

Director, is sufficient to keep wages from increasing as a result of

the new qualification requirements. Further, the new requirements are

not substantive enough to cause wages to increase. Third, operators

can always request authorization from the FAA to hire an applicant who

has comparable experience. For the initial upgrade to part 121, the

FAA will approve these authorizations to the extent practicable.

Thus, the FAA contends that the final rule will not impose a hardship

on operators in having enough potential qualified applicants to fill

the Director positions.

Director of Safety. This is a new position for part 121 but the

FAA contends that this position will impose little if any additional

cost to operators. The rationale for this assessment is based on two

factors: 1) there are no eligibility requirements for the Director of

Safety so virtually anyone can be designated as such; and 2) most

operators already have a Director of Safety or the equivalent.

Chief Inspector. For existing part 135 commuter operators who

will now operate under part 121, the position of Chief Inspector will

be new. The FAA contends that this requirement will impose little if

any additional cost. Many part 135 operators already have personnel

that are the equivalent of a Chief Inspector. The operator may

petition the Administrator to combine positions or request authori-

zation to appoint someone who has comparable experience. For the

initial upgrade to part 121, the FAA will consider these requests on a

case-by-case basis.

On-Demand Operators Conducting Scheduled Operations. Under part

135, on-demand operators will be allowed to conduct up to four

scheduled operations a week and still remain an on-demand operator.

There is no such allowance in part 121. Thus, if a current on-demand

operator conducts even one scheduled passenger flight with a 10-to-30-

seat airplane, then that airplane must be upgraded to and the

operation flown under part 121. The FAA has identified 5 airplanes in

the current fleet with 10 to 19 seats that are used by on-demand

operators in scheduled service. To bring these airplanes up to the

part 121 standards will cost approximately $1.73 million

($1.18 million, present value). The components behind this estimate

are provided below (explanations of these costs components are

provided in their respective sections).


The commuter segment of the U.S. airline industry is a vital and

growing component of the nation's air transportation system. Commuter

airplanes transport passengers between small communities and large

hubs, and they play a vital role in transporting passengers over short

distances, regardless of airport or community size. In many cases,

they are a community's only convenient link to the rest of the

nation's air transportation system.

Over the past 15 years, the size of the commuter industry has

grown considerably. In 1993, for example, enplanements for commuter

carriers grew by over 10 percent, far outpacing the one percent growth

of enplanements on larger carriers. Forecasts of commuter industry

activity give every indication that growth in this segment of the

airline industry will continue to be robust during the next 15 years.

Many commuter carriers operate in partnership with large air

carriers, providing transportation to and from hub locations that

would be unprofitable with larger airplanes. These partnerships

frequently operate within a seamless ticketing environment, in which

the large carrier issues a ticket that often includes a trip segment

on a commuter airplane. As these relationships between large carriers

and commuter airlines continue to grow, it will become more common for

the average long distance flyer to spend at least one flight segment

on commuter airplanes.

The combined effect of a continuing growth in the commuter

industry and the ever growing relationship between large carriers and

their commuter counterparts will progressively blur the distinction

between commuter carriers and larger air carriers. In other words,

passengers will no longer readily distinguish between one type of

carrier and another, but will simply view each component as a part of

the nation's air transportation system. It is imperative, therefore,

that a uniform level of safety be afforded the traveling public

throughout the system. Air carrier accidents, perhaps more than

accidents in any other mode, affect public confidence in air


What is the public value or benefit of air transportation? It

would be nearly impossible to calculate something that has been so

widely accepted in the American lifestyle. One figure that represents

the very least value the public places on traveling by air is the

annual amount the public spends on air transportation, or in other

words, annual air carrier revenues. In 1994, the FAA estimated that

amount to be $88 billion. If public confidence wavers by only one

percent, annual total air carrier revenues would be reduced by $880

million, which is a minimum dollar estimate of the cost that would be

experienced by the public in terms of being denied a fast, safe means

of transportation.

Some studies have been done to measure the effect of change in

public confidence. In 1987, the FAA studied the impact of terrorist

acts on air travel on North Atlantic routes. The study investigated

the relationship between the amount of media attention given to a

specific terrorist act and reductions in air traffic. The study

concluded that there was a measurable, short-term, carrier-specific

correlation between the two. Following a well-publicized incident,

ridership on the carrier experiencing the incident dropped by as much

as 50 percent for a few months. In another instance, a major air

carrier reported that two catastrophic accidents in 1994 resulted in a

half-year-revenue loss to that carrier of $150 million. These

examples relate to carriers operating large airplanes, but they

illustrate how the prevailing level of public confidence can affect

the public use of air transportation.

It is clear that the American public demands a high degree of

safety in air travel. This is manifested by the large amount of media

attention given to the rare accidents that do occur, by the short term

reductions in revenues carriers have experienced following accidents

or acts of terrorism, and by the pressure placed on the FAA as the

regulator of air safety to further reduce accident rates.

The FAA is confident that the final rule will further reduce air

carrier accidents. The final rule will require dozens of changes to

the way that smaller air carrier airplanes are built, maintained, and

operated--all aimed at eliminating or at the very least minimizing the

differences between small and large airplanes and the way they

operate. Many of these changes result in small, unmeasurable safety

improvements when examined in isolation, but taken together result in

a measurable difference. That measurable difference ultimately is to

bring commuter accident rates down to the very low level of that of

the larger carriers. That rate is nearing the point of rare, random


What follows is a quantified analysis of the potential benefits

of the final rule based on the assumption that it will reduce the

number of commuter airplane accidents and (possibly mitigate the

severity of those casualties in accidents that will occur). The

analysis finds that measurable potential benefits substantially exceed

the cost of the final rule, but the FAA believes that the larger but

unquantifiable benefit is continued public confidence in air


Safety Benefits From Preventing Accidents. The intent of the

Commuter Rule is to close, to the extent practicable, the accident

rate gap between airplanes with 10 to 30 seats currently operating

under part 135 and airplanes with 31 to 60 seats operating under part

121. The smaller "commuter-type" part 121 airplanes were used for

comparison because their operations best resemble those of commuters

than do larger part 121 airplanes. If the accident rate gap were

completely closed, the FAA estimates that up to 67 accidents involving

airplanes with 10 to 30 seats could be prevented from 1996 to 2010.

This would generate a benefit of $588 million, with a present value of

$350 million.

Typically, the FAA estimates aviation safety benefits based on

rates of specific types of accidents that the rulemaking would prevent

in the future. For this rulemaking, however, the FAA used a more

broad-based accident rate. This approach was adopted because the

scope of the various components of the rule covers such a wide range,

and many of those components are interrelated.

To estimate the benefits of the rule, the FAA assembled a

database of applicable part 121 and part 135 accidents between 1985

and 1994 using National Transportation Safety Board (NTSB) accident

reports. These accidents were categorized by the passenger seating

configuration of the airplanes involved -- 10 to 19, 20 to 30, and 31

to 60. The FAA then divided the annual number of accidents by the

annual number of scheduled departures for each group to derive the

annual accident rates. After calculating the 10-year historical

average accident rates, the FAA took the difference in the accident

rates between the part 135 airplanes and the part 121 airplanes. The

difference in rates was then multiplied by the projected annual number

of scheduled part 135 departures of airplanes with 10 to 19 seats and

20 to 30 seats from 1996 to 2010. Each step of this estimation

procedure is described in detail below.

The Accident Database. The NTSB defines an accident as an

occurrence associated with the operation of an airplane which takes

place between the time any person boards the airplane with the

intention of flight and the time such that persons have disembarked,

and in which any person suffers death or serious injury or in which

the airplane receives substantial damage. The FAA looked at only

those accidents for which the final rule could have an effect.

Accidents in which the probable cause was undetermined, the result of

turbulence, or was related to the ground crew were not included in the

database. The FAA also excluded midair collisions, since the current

airspace rules (Mode C, TCAS, positively-controlled-airspace areas,

etc.) would not be affected by the final rule. Finally, the FAA

excluded accidents involving unscheduled and all-cargo operations.

Annual Accident Rate. Based on the annual number of accidents

from the database and the annual number of departures, the FAA

estimated the accident rates for 10-to-30-seat airplanes operating

under part 135 and 31-to-60-seat airplanes operating under part 121.

From 1986 to 1994, the FAA found that part 135 airplanes with 10 to 19

seats were involved in accidents at a rate of .32 accidents per

100,000 departures and airplanes with 20 to 30 seats occurred at an

average rate of .17 accidents per 100,000. Accidents involving part

121 airplanes with 31 to 60 seats had an average accident rate of .13

accidents per 100,000 departures.

The Average Cost of a Part 135 Accident. From the accident

database discussed above, the FAA found that the average part 135

accident involving 10-to-19- and 20-to-30-seat airplanes cost

$6.3 million and $24.6 million, respectively.

Estimating Potential Benefits. To estimate the benefit of

closing the accident-rate gap between part 135 and part 121 airplanes,

the FAA took the difference in average accident rates for 10-to-30-

seat part 135 airplanes and 31-to-60-seat part 121 airplanes and

multiplied them by the projected annual number of departures for 10-

to-30-seat part 135 airplanes. This gives the projected annual number

of accidents that the final rule could prevent. The FAA estimates

that, from 1996 to 2010, 67 accidents could be prevented. Multiplying

the number of potential accidents by the average cost of a part 135

accident ($6.3 million for 10-to-19-seat airplanes or $24.6 million

for 20-to-30-seat airplanes) results in total potential benefits of

$588.2 million ($350 million, present value).

The extent to which the accident rate gap closes will determine

how much of the $350 million in potential benefits is actually

achieved. Based on the scope of the final rule, the FAA anticipates a

significant closing of this gap.


Over the next 15 years, the Commuter Rule will impose total costs

of $117.80 million, with a present value of $75.19 million. Of the

total costs, $80.36 million will be for airplanes with 10 to 19 seats

and $37.44 million will be for airplanes with 20 to 30 seats.

The benefit of the Commuter Rule is its contribution to closing

the accident rate gap between part 121 and existing part 135 commuter

operators. The FAA estimates that closing this gap will prevent 67

accidents over the 15 year period for a total present value benefit of

$350 million. It is not certain how much of the accident-rate gap the

final rule will close. In view of this uncertainty, the FAA contends

that the final rule will be cost-beneficial because it will have to be

only 21 percent effective for costs to equal benefits. Given the

broad scope of the rule, the FAA anticipates that, at a minimum, the

rule will be this effective and more.

One additional observation needs to be made. The FAA considers

the Commuter Rule to be complimentary to the Air Carrier Training

Program final rule and the Flight Crewmember Duty Period Limitations

and Rest Requirements NPRM. A common goal of these three rulemaking

actions is to prevent the 67 accidents that represent the accident-

rate gap between part 135 commuters and part 121 operators.

In terms of the accident-rate gap, the benefits of the Commuter

Rule are a part of this total benefit. However, it is not possible to

allocate that benefit among the three rulemaking actions because it is

difficult to determine which rulemaking action would prevent a given

accident. For example, individual accidents may be prevented by any

one or a combination of several factors such as:

preventing the occurrence of a problem with an airplane in the first

place (Commuter rule);

providing more or better crew training to properly respond to the

problem after it occurs (Air Carrier Training Program rule);

providing a dispatcher to help identify a problem before it becomes

a potential accident (Commuter rule); and

ensuring pilots are not over-worked and tired (The Rest and Duty


The Commuter Rule only addresses a portion of the necessary

requirements to close the accident-rate gap. If the $75 million

present value cost of this rule is combined with the $51 million in

cost-savings of the Flight and Duty NPRM, and the cost of Pilot

Training, $34 million, the total cost, $58 million ($34 - $51 + $75),

is still less than the estimated $350 million benefit of eliminating

the accident-rate gap. These rules combined need only be 17 percent

effective to be cost-beneficial.


Overview. The final rule will have a minimal effect on

international trade. Although there are a number of across-the-border

commuter services between the U.S., Canada, and Mexico, they represent

a small number of routes and airplanes. The only other concern with

regard to international trade is airplane sales. There is the

potential that increased equipment requirements and standards may

limit the ability of commuter airplanes manufactured for the U.S.

market to be resold to buyers in developing nations. Often, these

countries do not have extensive safety requirements and may prefer

less sophisticated airplanes.

International Routes. Most of the nation's 63 commuter airlines

operate almost exclusively on domestic routes, with only limited

international operations and no transoceanic routes. The majority of

these international operations are across-the-border services between

cities in the United States and locations in Canada and Mexico. There

are relatively few carriers engaging in this kind of commuter service,

with only a limited number of flights. Most of these services are

between points in the border states, such as California, Arizona,

Texas, Wisconsin, Michigan, Washington, and New York, flying to

Mexican and Canadian cities. Although the final rule may require some

foreign carriers to comply with its requirements, the primary effect

will still be borne by the domestic air carrier market with a minimal

affect on international trade.

Airplane Sales. Commuter airplanes are sold on a worldwide

basis, and this creates the potential for international trade impacts.

The final rule could affect the competitiveness of airplanes made for

the U.S. market that are resold internationally. Under the final

rule, commuter airplanes made for the American market would include

new equipment and upgrades necessary to meet expanded safety

requirements. These improvements will increase the cost and

maintenance requirements for the airplane and could negatively affect

their sales potential in foreign markets, particularly to customers in

developing nations.

Many small air carriers in the developing world fly under

significantly lower safety requirements than are required in the

United States. Operators are generally not motivated to purchase

airplanes that exceed their countries' minimum requirements. Further,

these operators sometimes lack the facilities, equipment, and

expertise that are necessary to keep sophisticated systems

operational. Therefore, when purchasing either new or second-hand

airplanes, operators tend to focus on airplanes that rely on a minimum

of complex systems and equipment and that meet their basic

requirements at the lowest cost.

Although sales of smaller airplanes to the developing countries

represent an important component of the market, the largest market by

far is in North America. In this case, since the airplanes will have

to operate under the same standards as before their resale, there

would be no impact. According to recent estimates, the worldwide

market for commuter airplanes is estimated to be almost $20 billion

over the next 15 years, with a projected 59 percent of those sales

occurring in North America. Sales to Europe account for approximately

20 percent of the total sales.

F. Regulatory Flexibility Determination Summary

The Regulatory Flexibility Act of 1980 (RFA) was enacted by

Congress to ensure that small entities are not unnecessarily or

disproportionately burdened by Federal regulations. The RFA requires

a Regulatory Flexibility Analysis if a final rule will have "a

significant economic impact on a substantial number of small

entities." The definitions of small entities and guidance material

for making determinations required by the Regulatory Flexibility Act

of 1980 are contained in the Federal Register [47 FR 32825, July 29,

1982]. Federal Aviation Administration (FAA) Order 2100.14A outlines

FAA's procedures and criteria for implementing the RFA. With respect

to the final rule, a "small entity" is defined as a commuter operator

(with 10 to 30 seats) that owns, but does not necessarily operate nine

or fewer airplanes. A "significant economic impact on a small entity"

is defined as an annualized net compliance cost to a small scheduled

commuter operator that is equal to or greater than $67,000 (1994

dollars). The entire fleet of a small scheduled commuter operator has

at least one airplane of seating capacity of 60 or fewer seats. The

annualized net compliance cost to a small operator whose entire fleet

has a seating capacity of over 60 seats is $119,900 (1994 dollars). A

substantial number of small entities is defined as a number that is 11

or more and that is more than one-third of small commuter operators

subject to the final rule.

The FAA is requiring certain commuter operators that now conduct

operations under part 135 to conduct those operations under part 121.

The commuter operators that will be affected are those conducting

scheduled passenger-carrying operations in airplanes that have a

passenger-seating configuration of 10 to 30 seats and those conducting

scheduled passenger-carrying operations in turbojets regardless of

seating configuration. The rule will revise the requirements

concerning operating certificates and operations specifications. The

rule will also require certain management officials for all operators

under parts 121 and 135. The rule will increase safety in scheduled

passenger-carrying operations and clarify, update, and consolidate the

certification and operations requirements for persons who transport

persons or property by air for compensation or hire.

The total present value cost to small entities with 10-to-19-seat

airplanes is $16.7 million. The section on operations represents

$10.1 million or 64 percent of the total. The section on maintenance

represents $4.0 million or 24 percent of the total. The total present

value cost to small entities with 20-to-30-seat airplanes is

$4.0 million. The section on operations represents $2.9 million or 73

percent of the total. The section on part 119 represents $416,000 or

10.4 percent of the total.

This determination shows that for an operator with only 10-to-19-

seat airplanes, the average annualized cost will be $61,900 and for an

operator with 20-to-30-seat airplanes, the average annualized cost

will be $35,600. Given the threshold annualized cost of $67,000 for a

small commuter operator (with 60 or fewer seats), the FAA estimates

that this final rule will not have a significant economic impact on a

substantial number of small entities. A complete copy of the

Regulatory Flexibility Determination is in the public docket.

Federalism Implications

The regulations do not have substantial direct effects on the

states, on the relationship between the national government and the

states, or on the distribution of power and responsibilities among

various levels of government. Thus, in accordance with Executive

Order 12612, it is determined that such a regulation does not have

federalism implications warranting the preparation of a Federalism


Paperwork Reduction Act

The information collection requirements associated with this rule

have been approved by the Office of Management and Budget, until

December 1998, in accordance with 44 U.S.C. Chapter 35 under OMB No.

2120-0593, TITLE: Commuter Operations and General Certification and

Operations Requirements.


For the reasons set forth under the heading "Regulatory

Analysis," the FAA has determined that this regulation: (1) is a

significant rule under Executive Order 12866; and (2) is a significant

rule under Department of Transportation Regulatory Policies and

Procedures (44 FR 11034; February 26, 1979). Also, for the reasons

stated under the headings "Trade Impact Statement" and "Regulatory

Flexibility Determination," the FAA certifies that the rule will not

have a significant economic impact on a substantial number of small

entities. A copy of the full regulatory evaluation is filed in the

docket and may also be obtained by contacting the person listed under


List of Subjects

14 CFR Part 91

Aircraft, Airmen, Aviation safety, Reporting and recordkeeping


14 CFR Part 119

Administrative practice and procedures, Air carriers, Air taxis,

Aircraft, Aviation safety, Charter flights, Commuter operations,

Reporting and recordkeeping requirements.

14 CFR Part 121

Air carriers, Aircraft, Airmen, Aviation safety, Charter flights,

Reporting and recordkeeping requirements.

14 CFR Part 125

Aircraft, Airmen, Aviation safety, Reporting and recordkeeping


14 CFR Part 127

Air carriers, Aircraft, Airmen, Aviation safety, Reporting and

recordkeeping requirements.

14 CFR Part 135

Aircraft, Airplane, Airworthiness, Air transportation.