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June 2014

the hotline 1984


Table of Contents

Sarah Says
Latest News
ARSA Works
Legal Briefs
ARSA on the Hill 
Regulatory Outlook 
Quality Time 
Membership
Regulatory Compliance Training
AVMRO 
International News
Upcoming Events


Sarah Says – Make the Call

By Sarah MacLeod, Executive Director

One call to ARSA can be worth years of membership dues.

Let’s take this scenario—a United States foreign repair station received articles overhauled in Canada and installed them on engines destined for the United States. A Federal Aviation Administration (FAA) inspector mistakenly claimed that the foreign repair station cannot use parts from Canada for installation on the U.S. airline’s engines. Until resolution is reached, the foreign repair station does not feel it can ship engines.

Both foreign repair stations (the one using the parts and the one in Canada) as well as the air carrier are members of ARSA—all call for assistance within hours of each other. The association gets the facts, researches the regulations and presents the misunderstanding to the policy division of the FAA; within a business day, a note is sent to the agency’s regional offices clarifying the requirements of the bilateral between the United States and Canada vis-a-vis 14 Code of Federal Regulations (CFR) part 43. The clarification merely restated the language of part 43 and the U.S./Canadian Maintenance Implementation Procedures (MIP), but it put the words into context. (There is, by the way, continuing confusion among and between countries with multiple but not coordinated bilateral aviation safety agreements. Unfortunately, these issues will continue because we do not [and probably never will have “world aviation regulations”—do you still wonder what WAR is good for?]).

Admittedly, the ability to quickly solve an issue with the correct information and the proper people is rare. Normally, the situation festers for days, months and years before the association is called; both parties have mixed facts with opinion and have misread, misunderstood or misapplied the regulations. Unwrapping those types of issues becomes a long-term commitment for the association and its members rather than providing almost instant gratification.

Nevertheless, consider membership in this association as an insurance policy; if you have a regulatory compliance question, you call the place with resources and quick answers. Even when the response isn’t what you want to hear, ARSA’s experts usually still help you attain an acceptable business solution. If the agency is dead wrong on your issue, the association can usually obtain quick resolution by providing the facts and regulations. In either event, you don’t waste time or money obtaining an evaluation – those resources are a call away.

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Latest News

Take Action: An International Voice on D&A Testing

By Ryan Poteet, Staff Attorney

The FAA’s Advanced Notice of Proposed Rulemaking (ANPRM) is the first stage of a process that could impose drug and alcohol (D&A) testing requirements on aviation maintenance providers around the globe. International stakeholders must be heard; ARSA will help find their voice.

Congress mandated that any foreign D&A testing requirement be “consistent with the applicable laws” of the country where the repair station is located. The ANPRM therefore requests information regarding international drug and alcohol testing rules; the association has developed a government comment template and an industry comment template to facilitate the international community’s response to that request.

The ARSA team encourages industry and government organizations to:

  • Review ARSA’s comment template and distribute to contacts at foreign CAAs and embassies.
  • Review ARSA’s industry comment template and distribute to contacts at fellow maintenance organizations overseas.
  • Circulate the association’s ANPRM survey (http://www.surveygizmo.com/s3/1635615/FAA-Drug-and-Alcohol-Testing) to maintenance providers in their countries.
  • Submit comments on the Advance Notice of Proposed Rulemaking (ANPRM) to the docket by July 17http://www.regulations.gov/#!documentDetail;D=FAA-2012-1058-0014.
  • Continue open dialogue regarding the development of any testing rule and use ARSA as a resource.

To view all of ARSA’s coverage of the ANPRM, click here.

 

Floridians in Flight: ARSA in Miami

By ARSA Communications Staff

The aviation maintenance, repair and overhaul (MRO) community is critical to Florida’s transportation economy. According to the 2014 Global MRO Market Assessment released by the Aeronautical Repair Station Association (ARSA) and TeamSAI Consulting, more than 16,000 Floridians go to work in contract repair stations every day; these businesses will pump close to $1.8 billion into the state’s economy this year.

ARSA’s Executive Vice President Christian Klein and Director of Operations Brett Levanto spent time with ARSA members and local government officials at an outreach breakfast in Miami on June 26. Together, they explored the vital role of aviation maintenance in the lives and livelihoods of the people of Florida, the United States, and the world. The meeting – hosted by ARSA member Barfield, Inc. – provided an ideal forum not only for ARSA to show local industry representatives how the association works on their behalf, but also for South Florida’s MRO community to discuss issues impacting the industry’s continued growth.

“ARSA works every day on behalf of the aviation maintenance industry; we wear a path around Washington and across the world to spotlight the vital work being done by contract repair stations,” Klein said. “Getting to spend a morning in the presence of the men and women who do that work makes it all worth it. We flew to Miami, and the reason we landed safely is right here in this room.”

 

EASA Launches Applicant Portal

By Crystal Maguire, Vice President of Operations

Some EASA forms may now be submitted online. The “applicant portal” is accepting initial and change applications from persons located in the EU or associated member states for major and minor repairs, supplemental type certificates, derivatives and European Technical Standard Order Authorisations.

EASA forms not eligible for online submission, including the U.S. maintenance organization initial certification and renewal form (EASA Form 9), are still available in the EASA document library: http://easa.europa.eu/document-library/application-forms.

 

FAA Resources: Aviation History

By Ciara Chambers, Communications Intern

ARSA staff members frequently search for resources, guides, and tools that might be useful for our members as they work to ensure global aviation safety. This installment comes from the Federal Aviation Administration’s ‘Celebrating a History of Excellence,’ a page devoted to American aviation history.

Historical Resources

The historical webpage contains exciting articles, photos, chronological timelines, and anecdotes designed to provide insight into the history of FAA involvement in aviation in the United States. The stories regarding aviation range from the story of Geraldine “Jerrie” Mock, also known as “The Flying Housewife,” to emergency action taken during the 9/11 terrorist attacks on the Pentagon and the World Trade Center in New York City. The page also features stories pertaining to more scandalous issues, such as whether the FAA headquarters was the past home of slave pens and agency action in the infamous Watergate brigade.

A short Excerpt from Ronald Lamb, Jr.’s ‘FAA and Watergate’

ButterfieldImage“In January 1973, five men were convicted for the Watergate break-in, and former Nixon aides, G. Gordon Liddy and James McCord were convicted of conspiracy, burglary, and wiretapping. Convinced that the scandal went deeper than just the break-in, Washington Post reporters Bob Woodward and Carl Bernstein kept the break-in front page news. The Senate began its own investigation, and established the Select Committee on Presidential Campaign Activities. In May the Senate committee began hearings. As the hearings proceeded, evidence pointed to Nixon’s direct involvement in the scandal. FAA Administrator Alexander Butterfield’s public disclosure of the existence of a secret White House taping system during the hearings, which proved President Nixon’s involvement in the scandal, ultimately led to Nixon’s resignation on August 9, 1974… Butterfield’s responsibilities involved setting Nixon’s schedule and maintaining historical records. He also supervised internal security for the White House. In this capacity, he oversaw the installation of a secret, voice-activated taping system in the White House…

“In public testimony on July 16, 1973, when asked specifically if White House conversations were recorded, Butterfield replied, “Everything was taped . . . as long as the president was in attendance. There was not so much of a hint that something should not be taped.” After Butterfield’s testimony, a protracted legal battle ensued between the White House and the prosecutors trying to gain access to the tapes. Facing impeachment by the House and removal from office by the Senate, on August 9, 1974 Nixon resigned the presidency. Although Butterfield was not involved in the Watergate cover-up and did not face any criminal consequences, his political career became irreparably tarnished among many Republicans…”

To see the entire ‘Celebrating History’ collection, click here.

For more international aviation resources, click here.

 

Filler Speaks on International Issues

By Kelsi Oliver, Communications Coordinator

Marshall Filler, ARSA managing director and general counsel, joined with other international aviation representatives on Wednesday, June 18, at the 2014 FAA-EASA International Aviation Safety Conference. Filler and fellow stakeholders focused on various aspects of the U.S. and EU Safety Agreement along with its Technical Implementation Procedures (TIP) and Maintenance Annex Guidance (MAG).

Filler spoke on a panel entitled “Annex 2 of the US/EU Safety Agreement: Updates to the Maintenance Annex Guidance and What to Expect in Sampling Inspections.” The panel also included representatives from the FAA, EASA and MTU Maintenance Hannover.

FAA and EASA representatives updated participants on the changes that have been made to the MAG based on lessons learned since its implementation. They also briefed attendees on the Sampling Inspection System (SIS). The SIS is an effort by the two agencies to consult and share information on quality assurance and standardization activities. Its objective is to ensure that each authority can be confident in the surveillance conducted by the other. Consistent implementation of this system, combined with dependable education addressing MAG procedures and changes, are essential if we are to move forward in today’s international landscape.

ARSA focused on issues and compliance challenges that have not yet been resolved—specifically part tagging requirements, acceptance of a common release certificate and the need to heighten the awareness of the U.S. air carrier industry about the mutual acceptance of most repair data. MTU, while citing its own frustrations with U.S. operators on the repair data issue, echoed a common theme among industry representatives attending the conference: inconsistent regulatory standards and their application do not promote safety and efficiency in the aerospace industry.

ARSA’s leaders work tirelessly to engage with government and industry representatives through public events and engagement. For more information, please visit our industry events page.

 

House Works for Small Business

By ARSA Legislative Staff

On June 9, the House passed the America’s Small Business Tax Relief Act (H.R. 4457), which permanently increases Sec. 179 expensing levels. The bill is awaiting Senate action.

Under current law, beginning in 2014, a taxpayer may immediately expense up to $25,000 of Sec. 179 property annually, with a dollar for dollar phase-out of the maximum deductible amount for purchases in excess of $200,000. H.R. 4457 would permanently increase the maximum amount and phase-out threshold to the levels in effect from 2010 through 2013 ($500,000 and $2 million respectively).

Additionally, the proposal includes adjustments for inflation, repeals the exclusion of air-conditioning and heating units from qualified expenses, and eliminates the $250,000 limit on real property qualifying for expensing.

“ARSA commends Congressman Tiberi and the bill’s bipartisan supporters for introducing a proposal benefitting the 244,000 American aviation maintenance workers,” said Daniel Fisher, ARSA’s vice president of legislative affairs. “Last March, the jointly released ARSA and TeamSAI Consulting report confirmed that more than 84 percent of U.S. repair stations have fewer than 50 employees. That means more than 3,300 small businesses need rapid returns on investments to remain competitive.

“The America’s Small Business Tax Relief Act will help those independent repair stations invest in their companies as well as the country’s economic health. Now is time for the Senate to act by passing the legislation as soon as possible to spur economic growth and job creation.”

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ARSA Works

To see all the ways that ARSA is working as the voice of the aviation maintenance industry, visit our ARSA Works page.

 

FAA Response – Parts Identification

By ARSA Regulatory Staff

In a June 19 letter, the FAA addressed ARSA’s request for guidance regarding the identification that should be referenced in maintenance records when more than one production approval holder number is applied to a part.

While the FAA issued a partial response to the association’s request, it did not address the requirements that a maintenance provider understand and know the part it is receiving vis-à-vis the data needed to ensure work is performed properly. It is commendable that the agency’s guidance in Order 8130-21H partially addresses the issue; however, the responsibility of a maintenance provider is contained in part 43 (and for repair stations, part 145). Those regulations requires appropriate actions by the maintenance provider in spite and despite “instructions from the customer.” The association will work with the agency to ensure the interrelated regulatory responsibilities and nuances are understood and addressed.

Stay tuned for further coverage.

 

FAA Response – Agency to Clarify Final Inspection Guidance

By ARSA Regulatory Staff

In response to ARSA’s Nov. 30, 2011 and May 14, 2014 requests, the Federal Aviation Administration (FAA) will revise Order 8900.1 to reflect that repair station personnel performing final inspections are not required to be certificated under part 65.

On May 14, ARSA submitted a letter to the Federal Aviation Administration (FAA) requesting it correct parts of Order 8900.1 that purportedly requires persons performing final inspections be certificated under part 65. This guidance is incorrect and fails to recognize the regulatory distinction between performing a final inspection and approving the work on an article for return to service. ARSA addressed this issue back in November 2010 but the erroneous guidance remains despite the 2013 and 2014 revisions to Order 8900.1.

The regulations clearly demonstrate that the final inspection and “maintenance release” are two separate and distinct activities. This issue almost never arises because most of the time, persons performing the final inspection are also qualified to issue the approval for return to service; however when a repair station separates these activities, confusion ensues. The regulations certainly make the separation and Order 8900.1 should be revised accordingly.

 

FAA InFO – Right Direction on EASA Data Acceptance

By ARSA Regulatory Staff

On June 12, 2014 the FAA issued Information for Operators (InFO) 14008.

The InFO was developed in response to a Feb. 19, 2014 ARSA letter  highlighting misunderstandings surrounding U.S.-EU Safety Agreement Technical Implementation Procedures (TIP) provisions on mutual acceptance of repair data.

When a European-based approved maintenance organization (AMO) performs maintenance for a U.S. air carrier, an 8110-3 is often requested for data that is already approved under the agreement. ARSA’s request highlighted this redundant and unnecessary U.S. approval of EASA-approved technical data.

The InFO did not include ARSA’s suggested language making clear that any written communication (e.g., memoranda, e-mail, designee communications, etc.) from the agency regarding the approval of data is acceptable, not just formal letters.

While the InFO didn’t incorporate all of ARSA’s recommendations, it is an important step in the right direction. ARSA will continue to work with the FAA and EASA to ensure continued efficiencies are made amongst and between international regulated entities.

To see all the ways that ARSA is working as the voice of the aviation maintenance industry, visit our ARSA Works page.

 

ARSA: Industry Waiting Too Long for Security Rule Classification

By ARSA Regulatory Staff

ARSA’s engagement with the Transportation Security Administration (TSA) concerning the repair station security rules continued as the association pushed the agency for an answer to a previous inquiry and long-promised guidance.

In a June 12 letter, ARSA’s Vice President of Legislative Affairs Daniel Fisher urged the agency to promptly respond to prior correspondence regarding when a repair station assumes dominion and control of a large aircraft under the rule. Additionally, Fisher requested TSA release official guidance and a “question and answer” document addressing key nuances with the regulation’s implementation.

“Our request takes on particular urgency since the agency is conducting audits and inspections of domestic and foreign repair stations despite key outstanding issues and questions surrounding the final rule,” Fisher wrote.

Staying on top of issues like this is just another example of how ARSA works. To see all the ways that ARSA is working as the voice of the aviation maintenance industry, visit our ARSA Works page.

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Legal Briefs

International Regulatory Compliance – The Bouncing Ball

By Crystal Maguire, Vice President of Operations

International business success requires sophistication and knowledge. The repair station (and the authority) must ensure awareness of both foreign and domestic regulations, bilateral and technical agreements, implementation procedures and guidance.

To make your way through the maze, first, ask the right questions:

1: Where are you located?
2: Where was the product (aircraft, engine or propeller) or article located when the work was performed?
3: Where is the product destined or registered?

Based on the answers, create a matrix for regulations, bilateral, technical and implementation agreements and guidance documents for both the country where the repair station is located, the country where the work was performed and the country where the product was registered or is destined.

For example, say a U.S.-based Federal Aviation Administration (FAA) repair station seeks to maintain a U.S.-aeronautical product or article in Canada. (A U.S. or Canadian aeronautical product is one under the regulatory control of the FAA or TCCA, respectively.) Under 14 CFR § 145.203, repair stations may work away from their fixed location in accordance with procedures in their repair station quality manual. However, since the U.S. and Canada have a bilateral agreement, the work must be done in accordance with the Transport Canada Civil Aviation (TCCA)/U.S. Maintenance Implementation Procedures (MIP). Chapter II, paragraph 2.0(b) of the MIP states that:

“[M]aintenance and modifications performed on a civil aeronautical product under the regulatory control of the TCCA may be accomplished and that product returned to service by an FAA-certificated repair station …  when the product is located in the United States.” (Emphasis added)

So, the U.S.-based FAA repair station may not utilize its working away procedures to maintain a Canadian-aeronautical product or article located in Canada, but what about maintaining a U.S.aeronautical product or article in Canada? Chapter II, paragraph 2.0(c) provides—

Maintenance and alterations performed on a civil aeronautical product under the regulatory control of the FAA may be accomplished and that product returned to service by a [Canadian Aircraft Maintenance Organization (AMO)] or [Canadian Aviation Maintenance Engineers (AME)] that has been certificated by the TCCA … when the product is located in Canada. (Emphasis added)

Paragraph 2.1(a) of that same chapter further states—

The FAA agrees that an AMO or AME that has been approved or rated for maintenance and modification work by the TCCA in accordance with [Canadian Aviation Regulations (CARs)] 571 and 573, and complies with the special conditions … will be eligible to perform maintenance, preventive maintenance, and alteration work on aeronautical products under the regulatory authority of the FAA.

In other words, only a TCCA-certificated AMO can maintain a U.S. aeronautical product located in Canada. A U.S.-based FAA repair station may not “work away” in Canada, even if the work is performed on a U.S. aeronautical product. To make that determination, the U.S.-based facility must consult the FAA regulations, the TCCA CARs and the TCCA/U.S. bilateral agreement.

What about countries that do not have a bilateral agreement with the country where the repair station is located? It is important to note that when country A has a bilateral agreement with country B, and country B has an agreement with country C, country A’s agreement typically does not “extend” to country C.

For a simple illustration of these international complexities, see this month’s A Member Asked which concerns a company with an FAA-approved foreign repair station in Brazil, a Canadian AMO and an engine under the regulatory control of the FAA. The moral of that story: obtain knowledge along with each certificate and when you don’t know or can’t find the answer — call your trade association!

The following online resources will help you navigate the international web — bookmark them!

ARSA summary of FAA, TCCA and EASA bilateral agreements: http://arsa.org/wp-content/uploads/2014/07/ARSA-BASAMatrix-20140107.pdf.

U.S. Federal Aviation Administration

Bilateral agreements: http://www.faa.gov/aircraft/repair/

Electronic code of federal regulations: http://www.ecfr.gov/cgi-bin/ECFR?page=browse

Approved repair stations:* (the organization’s profile denotes EASA approval): http://av-info.faa.gov/repairstation.asp

Transport Canada

Bilateral agreements: https://www.tc.gc.ca/eng/civilaviation/standards/int-baa-menu-3672.htm

Canadian Aviation Regulations: http://www.tc.gc.ca/eng/civilaviation/regserv/cars/menu.htm?campaign=Twitter-eng

Approved maintenance organizations*: http://wwwapps.tc.gc.ca/saf-sec-sur/2/CAS-SAC/aooal.aspx?typ=1&lang=eng

European Aviation Safety Agency

Bilateral agreements: http://easa.europa.eu/easa-and-you/aviation-domain/partnerships/bilateral-co-operation

Regulations: http://easa.europa.eu/regulations

EASA-approved foreign maintenance organizations located in:

 

 

*Under the Canadian/U.S. bilateral agreement, all repair stations in the U.S. are “accepted” by Canada and all AMOs in Canada are “accepted” by the FAA. Neither authority issues “foreign” air agency nor approved maintenance organization certificates to the other’s entities. Verification must be made on the appropriate authority’s website.

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ARSA on the Hill

All Politics is Local
By Daniel Fisher, Vice President of Legislative Affairs

Former House Speaker Tip O’Neill used to say, “all politics is local”; representatives must attend to and address their constituents issues in order to win election.

In June, Capitol Hill was shocked by House Majority Leader Eric Cantor’s loss in his Richmond, Va., area district.  Denied a seventh congressional term, political pundits were looking for answers.  Was it the beginning of a Tea Party wave?  No. Was Cantor too liberal for the district?  No.

Cantor, while campaigning across the country and working hard on behalf of the national GOP, lost touch with his district.  And he paid the ultimate political price as his constituents realized there was an alternative.  Current lawmakers and congressional candidates have taken note.

Every week, on behalf of ARSA, I meet with House and Senate members, senior staff, and candidates.  Since Cantor’s defeat, both Democrats and Republicans got the message loud and clear – be active and present in the district or you won’t be sent back to Washington.  The aviation maintenance industry must take advantage.

Lawmakers and candidates have never been more willing to touch businesses and their employees.  In Washington, I recently met with Tony Strickland.  Strickland, a Republican congressional candidate, is the frontrunner to be California’s 24th congressional district’s next congressman.  In May, ARSA coordinated a facility visit and ARSA PAC check presentation for Strickland at Fortner Engineering in Glendale, Cal.  During our meeting, Strickland expressed his gratitude to ARSA for introducing him to a family-owned business that’s creating jobs, economic growth, and ensuring aviation safety in Southern California.  And, he wanted to know if we had more maintenance companies for him to visit!

Strickland’s not alone.  And never has there been a better time to have your lawmakers or candidates visit your facility.  We’re standing by to make it as easy as possible on you.

It’s a small investment of time that can pay major dividends for your company and the broader industry.  At best, Fortner Engineering and ARSA have a new ally fighting for our top policy priorities; at worst, we have a policymaker educated on the impact of the aviation maintenance sector in his area.  Seems like a win-win for everyone.

Let’s take advantage of the realization that all politics is indeed local.  Contact me to learn more about setting up a facility visit.

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Regulatory Outlook

Time: The Fire in Which We All Burn

By Andrew Langer, President, Institute for Liberty © 2014 Andrew Langer ALL RIGHTS RESERVED.

In the first two articles on regulatory burdens, we discussed the direct impact of federal regulations on the American economy, as well as the how those direct costs actually understate the true impact, given the lost “opportunity costs.”  We also discussed the tremendous gains that could be made by even the most meager attempts at regulatory reform.

In this third article, we will take the next step: to talk about new ways in which to assess burden and offer some further reform suggestions.

It should be noted that when it comes to regulatory reform, there are no silver bullets – no all-encompassing solutions.  The problem is multifold – some solutions simply don’t actually get to the problems they are trying to address, while others are limited by federal bureaucrats who pay mere lip service to the reform laws.  Other solutions just create more workarounds for regulators to try and sidestep.

For example, federal regulators are supposed to assess and minimize regulatory burdens in theory.  But when these rules become too restrictive, regulators sidestep them by issuing administrative guidance documents or letters, pronouncements that (debatably) have the force of law but didn’t go through the usual “notice and comment” process of public review and input required by the Administrative Procedures Act (APA).

Whether it is President Reagan’s Executive Order on Regulatory Takings, or agency adherence to the Paperwork Reduction Act, or any one of a number of rules put into place to assess and/or minimize the impact of federal rules, in too many cases the agencies simply go through the motions at compliance, resulting in a regulatory state that continues to grow—somewhat checked but growing nevertheless.

Since, as was demonstrated in the second article in this series, “opportunity costs” are a far more accurate depiction of regulatory burden, I suggest that we consider placing a greater emphasis on time burdens in regulatory impact assessment.  To recap – an opportunity cost is the productivity lost when a regulation forces a business to have its employee spend his or her time dealing with regulatory compliance, as opposed to engaging in the firm’s business.  We discovered, using the research of economists at North Carolina State University and Appalachian State, that there is a $19 multiplier between direct cost and opportunity cost (i.e., that for every dollar in direct regulatory burden, there are $19 lost in opportunity cost).

“Time” is a limited resource — there is only so much of it in the universe.  And while the forces of those in favor of ever-increasing amounts of regulation can always use the “people are more important than profits” argument, while stating that a business can simply eat the profits or try to make more money (as if that were possible), stating burden in terms of time makes this more difficult.

A poet, Delmore Schwartz, wrote that time is the fire in which we all burn — and when it comes to your business, you certainly know this to be true.  A full-time equivalent position is 2,000 hours per year (40 hours per week, 50 weeks per year).  Every eight-hour day that your employees are spending doing tasks mandated by a federal rule is nearly a half a percentage point of their annual productive time – time that they (and you) will never get back (“burned up,” as it were) doing what someone else considers a higher priority than what you hired that person for.

What I suggest is that a greater emphasis be placed on measuring, reporting, and reforming these time burdens.  When we focus on the overall monetary costs in rules, at the very least we become mired in the discussion (mentioned above) of “people versus profits”. This is not to say that assessing monetary impact isn’t important –it is, but it only gets us so far.

Time is a constant, the value of the dollar (especially in this day and age), not so much.  So when we create laws that focus on burdensome regulations that cost “X”, that value can change over time (and thus the rules that fall under it) can change over time.  Moreover, we also know two things about rules (and the agencies that create them).  First, we know that it’s almost never the biggest rules that cause the biggest headaches.  They do cause them, but it’s the cumulative impact of the smallest rules that really create the burden (the so-called “death by a thousand pinpricks”—tiny burdens that eat away at a business).

Second, we know that if we do create restrictions on agencies with massive new rules, the agencies will merely assess their impact at below that threshold, thus not triggering the new restrictions.

So I suggest that we require agencies to start assessing their annual cumulative impact in terms of the time burden that their rules place on the businesses they regulate.  Then, taking that cumulative number, assessing the number of firms that fall under their framework and averaging that number will give an average annual time burden (AATB).

We then institute a system called “no net loss of time,” initially setting that AATB as a baseline that agencies cannot exceed.  For every 15 minutes of AATB that the agency wants to add, they have to subtract minutes from someplace else.  The agencies have to annually assess this burden and report on it to Congress.  Then, after five straight years of AATB constancy, the agencies will then be mandated to start reducing the AATB.

One of the great problems in the past with regulatory reform statutes is the lack of accountability to Congress.  With the “no net loss of time” law, I suggest a different approach.

Not only does Congress hold the “purse strings,” given the constitutional relationship between the Senate and the executive branch’s senate-approved appointees, Congress has greater powers when it comes to these staffers.  I suggest that “no net loss of time” come with the added caveat that Senate-approved executive branch employees will have their salaries “docked” if they fail to live up to these requirements. (While it is constitutionally questionable to personally single out such appointees, I believe that a rule that focuses on these individuals based upon the job they hold would withstand constitutional muster.)

With personal (as opposed to agency) accountability, I believe we could achieve tremendous gains — and again, given the multiplier effect of opportunity costs, marginal gains in productive time could produce tremendous economic benefits overall.

There are no easy answers to regulatory burdens and no quick fixes.  It has taken us more than four decades to get us into the regulatory mess we find ourselves in.  It will take some time to get us out of it.  But knowing where the problem is, and taking meaningful steps to deal with that problem, will get us out.

Andrew Langer is the President of the Institute for Liberty, a Washington, DC-based advocacy organization focusing on the American regulatory state.  He has testified before Congress nearly two dozen times on regulatory issues.

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Voluntary Disclosure – Know the Process

By Crystal Maguire, Vice President of Operations

Steve Pazar’s May 2014 Legal Waypoints illustrated how essential it is to follow each and every step in a required process. Specifically, the article related one company’s experience when it failed to follow the FAA’s Voluntary Disclosure Reporting Procedure (VDRP).

While the FAA encourages prompt reporting of nonconformities through its VDRP, the certificate holder must ensure its internal processes and the FAA’s procedure are strictly followed; otherwise, disclosure only creates an easy target.

Advisory Circular (AC) 00-58B Voluntary Disclosure Reporting Program outlines the procedures that, if followed, limit the agency’s authority to “punish” the certificate holder for properly disclosed regulatory violations:

Step 1: Obtain access to the VDRP web-based system, available at https://av-info.faa.gov/vdrp/Login.aspx. Your principal maintenance inspector (PMI) will provide login information to the named company representative. Repair stations are required to use the VDRP web-based system for voluntary disclosure submissions unless “extenuating circumstances” prevent its use. If your repair station representative does not currently have log in information, contact your PMI now, before you need it.

Step 2: Confirm that the disclosure requirements are met:

  • You can notify the FAA (through its local inspector) of the apparent violation in a “timely” manner and before the agency learns of it by other means (i.e., you can’t disclose during an FAA inspection or accident investigation). Notification should be accomplished within 24 hours after discovery; however, inspectors may make exceptions when deemed “justifiable”.
  • The apparent violation was inadvertent.
  • The apparent violation did not indicate a lack, or reasonable question, of the regulated entity’s qualifications.
  • You took immediate action upon discovery to terminate the conduct that resulted in the apparent violation.
  • You developed (or are developing) a comprehensive fix and have scheduled implementation, including a follow-up self-audit.
  • You are not otherwise required to report the issue (e.g., failures, malfunctions and defects under 14 CFR § 21.3).

Step 3: Notify the FAA of the apparent violation. Notification will normally be made via the VDRP web-based system (see Step 4). When extenuating circumstances prevent initial notification using that venue, notice may be submitted orally, via a written hardcopy, or by electronic mail provided you enter the initial notification data via the VDRP web-based system within 72 hours.

Step 4: Submit (through the VDRP web-based system) an initial disclosure report, to include:

  • A brief description of the apparent violation,including an estimate of the time it remained undetected and how it was discovered.
  • Verification that the apparent non compliance has ceased.
  • A brief description of the immediate action taken,the action taken to terminate the conduct and the person responsible for taking the immediate action.
  • Verification that an evaluation is underway to determine if there are systemic problems and a description of the remedial steps necessary to prevent a recurrence.
  • Identification of the person responsible for preparing a comprehensive fix.
  • Acknowledgement that a detailed written report will be provided to the FAA within ten working days.

Step 5: Obtain written confirmation that the FAA received the initialdisclosure report and that it meets the stated requirements. If notification was submitted through the VDRP web-based system, the FAA will acknowledge receipt through that system.

Step 6: Within 10 working days of notification, submit(through the VDRP web-based system) a detailedwrittenreport, to include:

  • A list of the specific regulation(s) that may have been violated.
  • A description of each apparent violation, including the duration of time it remained undetected (e.g., hours, cycles, days), how and when it was detected.
  • The immediate action(s) taken to terminate the conduct, when it was taken and who was responsible for each action.
  • An explanation that shows the apparent violation(s) was/were inadvertent.
  • A summary of the evidence that describes the scope of each apparent violation, how it was detected, the seriousness (its effect on safety) and any conclusions reached regarding systemic deficiencies (i.e., who, what, when, why and how each potential noncompliance occurred).
  • Supporting documentation/evidence associated with discovering each potential violation and its scope.
  • A completed Risk Assessment Matrix to aid in evaluating the significance of the event.
  • A detailed description of the proposed comprehensive fix including the identification of the root cause, corrective steps, the responsible parties and the timetable for completion.
  • Identification of the person responsible for the implementation and completion of the comprehensive fix.

Step 7: Collaborate with the FAA and agree upon (in writing!)the proposed comprehensive fix and implementation schedule. Remember that the comprehensive fix must be acceptable to the FAA.

Step 8: Implement the agreed-upon comprehensive fix according to its implementation schedule.

Step 9: Obtain a letterofcorrection from the FAA.

Step 10: Complete and file aself-audittoensurethe comprehensive fix will preventarecurrence.

Step 11: Undergo final FAA assessmenttoensureallelementsofthecomprehensivefixwereaccomplished.

Step 12: Receive confirmation that the PMI has closed the case (generally through the VDRP web-based system).

The FAA may rescind a letter of correction and/or reopen a case if the comprehensive fix is not properly implemented and/or completed. It is therefore very important that you ensure each step is properly accomplished.

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Final Documents/Your Two Cents

This list includes Federal Register publications, such as final rules, Advisory Circulars, and policy statements, as well as proposed rules and policies of interest to ARSA members. To view the list, click here.

 

Quality Time

Editor’s note: The views and opinions expressed by contributing authors do not necessarily state or reflect those of ARSA, and shall not be used for endorsement purposes.

 

Legal Waypoints: Accountable Manager – 14 CFR part 145

By Steven E. Pazar, Attorney at Law, 11 Carriage House Lane, Boxford, Massachusetts 01921. © 2014 Steven E. Pazar ALL RIGHTS RESERVED

Acting in an official capacity on behalf of a certificated repair station is a serious matter.  Improper use of authority can result in violations of the law that risk assessments of civil and/or criminal penalties – notwithstanding the real possibility that aviation safety may be compromised in the process.  Understanding the sources and limits on your authority can aid in reducing the chance for unintended violations. Take a few minutes to check your authority and refresh your understanding of your role and obligations.

Depending on your role within the part 145 organization, you may be authorized by the regulations to take certain specific actions and make particular representations. For example, technicians have a particular role and a related set of authorized actions that guide their work and decision-making. Likewise, inspectors have a unique role, must meet specific qualifications under part 145 and their own related limits of authority. Specific roles are designated by the repair station to specifically qualified individuals – to understand your specific roles and responsibilities see your Repair Station Manual (RSM) and Quality Control Manual (QCM).

The authority to perform most of these “operational” roles comes from the regulations and flows to the individual by express actual authority from, and at the discretion of, the company. The RSM/QCM’s organizational chart should depict each role and the chain of command from top to bottom. Needless to say the RSM and QCM should be consistent with the latest regulatory guidelines and requirements of the regulatory authority (FAA, EASA, TCCA, etc.).

In addition to the “operational” roles of those who are directly involved in the maintenance, preventive maintenance, alteration and inspection process, or provide direct supervision, each repair station also has a designated “authorized representative”. The definition for this term has been modified slightly over time but the current version makes it clear that the company must designate a:

Person “responsible for, and having authority over all repair station operations conducted under part 145. This person’s duties include ensuring that repair station personnel follow the regulations and serving as the primary contact with the FAA.”

For those Certificated Repair Stations that also comply with EASA requirements the definition of the term is more specific but equally relevant to this discussion:

Accountable Manager [EASA]: The accountable manager is normally intended to mean the chief executive officer of the organization, who by virtue of position has overall [including in particular, financial] responsibility for running the organization. When the accountable manager is not the chief executive officer, he must have direct access to the chief executive officer and have a sufficiency of maintenance funding allocation.

In summary the authorized representative means that person who will be held accountable for compliance with the dictates of part 145. This individual will be the point of contact with the government regarding official communications, such as letters of investigation and notices of proposed (or final) civil penalty. More importantly, that person must have authority to buy or fix necessary housing, facilities, equipment, data and materials; hire and fire personnel and ensure personnel are trained, and/or do any other thing that is required for compliance with the applicable regulations.

Similar to the specific grants of authority for the operational roles set out in the RSM and QCM, the repair station’s corporate records should reflect the specific grant of authority for the Chief Executive Officer or other designated individual to serve in this official capacity. If you have been “designated” the accountable manager without the authority to perform the necessary corporate functions, violations can result.

Steven counsels businesses operating in high-risk industries – including aviation – he provides templates, tools and training that will improve contracting efficiency, close deals faster and control costs.

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I Need a DER – Or Do I?

By Peter Lauria, Principal, JT Consulting, LLC  © 2014 Peter Lauria ALL RIGHTS RESERVED

Choices to be Made

What can a repair station do with articles that require repairs beyond those listed in the manufacturer’s documents? The article received for maintenance has one or more conditions that individually, or in combination, exceed the existing reusable/repairable parameters due to erosion, wear, cracking, loss of plating, handling damage, burning and delamination.

Well, your choices are to replace the part, or to find or develop a new repair that addresses the condition. Replacement is usually the easier, although more costly, approach. Replacement with a new part from a production approval holder (PAH) creates certainty that the article will be returned to its original (or properly altered) condition. The manufacturer will sell a new part (with an appropriate markup); the repair station’s task is simplified and the customer is reassured because there are original equipment manufacturer (OEM) parts being used.

Replacement, however, may not be the best approach—for either the repair station or the customer.

A Look at Repair and Inspection Limits

When repair station inspectors are faced with a part exhibiting damage or wear, the first step (after disassembly and cleaning) is a dimensional check against the limits in the applicable maintenance documents. The manual or service bulletin will usually have specific pass/fail criteria for all “nonstandard hardware” or parts. The criteria could be as simple as minimum material thickness remaining, or could be more complex with crack length, numbers of cracks and combined crack length, delaminated area, and erosion or oxidized (burned) area limits. If the part meets the criteria the decision is simple – reuse or repair the part as directed by the maintenance instructions.

If the inspection result falls “outside” the stated limits, you are faced with the replacement or repair development decision.

A Look at the Options

(1)    Replacement with a new OEM PAH part– This is straightforward, especially if your repair station contract requires it. However, cost, timing and/or availability of new parts might not make this a viable or desirable option. Even if it is a good short-term solution, it may not be a viable long-term option.

(2)    Replacement with an independent Parts Manufacturer Approval (PMA) article– If usage is high enough and you have, can develop or find the capability to produce a replacement part, you could produce it yourself. The “independent” PMA may need to be approved by your airline customer and may be prohibited by your contracts. The development of owner-operator or maintenance fabrication may be against your contractual obligations and/or will need approval from your airline customers. While this option may be inconvenient or costly at the outset, it certainly can be considered for long term viability and capability.

(3)    Replacement of a used part from searching the marketplace — This option will require additional inspection and/or repair by your repair station or another repair station (if you do not have the capability for the internal article). This may be a short-term option and it can be as costly as OEM-PAH replacements depending upon timing and availability. If the articles are becoming scarcer the continual search for maintainable articles will not provide a long-term solution; eventually other options will need to be explored.

(4)    Replacement by way of new “repairable limits”– You could develop new repair procedures, and with those procedures, establish new limits. Repair stations have looked to this option as the most cost-effective choice that also assures long-term capabilities. Unfortunately, this option is the least straightforward of the choices.

Do I Call a DER Now?

When you make the decision to develop a repair, the first couple of steps are critical. To save time and energy in the long haul, this is the time to contact an FAA-Designated Engineering Representative (DER) to help you through the process.

Since not all repairs require FAA DER approval, there are some steps you can take before calling a DER that will limit costs:

(1)     Gather all applicable information about the original article and the proposed repair:

(a)    Description of the part (P/N, S/N (if applicable); function; location in the component, engine, or airplane; modification status; service bulletin incorporation level and so on)

(b)   Description of damage (type, size and location) that you wish to repair—establish your own new limits, since all damage cannot be “repaired.”

(c)    Reference material (all maintenance or overhaul manuals and/or Illustrated Parts Catalogue (IPC) number, chapter, page, item number, all service bulletins, airworthiness alerts and airworthiness directives).

(d)   Potential failure modes and effects for the original article and for the article as repaired.

(2)    Outline the potential result to determine if the repair should be considered major or minor. If the repair is classified as minor, the data developed to substantiate the action will not need to be approved by the FAA DER. If the end result of the repair is determined to be major, you must have the substantiating data FAA-approved through the FAA directly or with the assistance of a DER.

Peter Lauria has over 30 years’ experience with aircraft manufacturers, test equipment manufacturers, repair stations and airlines. He is the owner and principal of JT Consulting, LLC., providing engineering consulting, DER services, and ODA guidance.

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The Five Priorities for Critical Decision Making

By Bill Peterson, Lean Instructor, University of Tennessee © 2014 William Peterson ALL RIGHTS RESERVED
Speed with Discipline

This central tenet of operations for the United States Air Force Life Cycle Management Center was recently established by its commander, Lt. Gen. C.D. Moore, and it captures in just three simple words a universal goal: the need to reduce lead times and cost while ensuring the work is done right the first time. But this goal often creates tension between managers and the workforce, especially when safety is at stake.

This was my dilemma as a manager in the ‘90s at an aircraft component repair shop, when my constant challenge was to get components repaired and placed back into stock better, cheaper and faster.  As I communicated this goal to my department, my technicians were adamant about one thing:  they would not compromise safety or their livelihood by expediting any process.

And I couldn’t blame them. I was licensed, too – I could absolutely relate. In industries where there is a safety factor for technicians in the execution of tasks, there is a whole different dimension of danger to compromising safety and compliance. And as a manager, I would of course be held accountable for any safety or compliance issues.

But I had a process improvement initiative to implement, and I was getting nowhere. I needed to be able to define how to execute the Speed with Discipline concept in a way that satisfied my conscience and that would alleviate the technicians’ concerns.

I debated about speed versus discipline in my head over and over again, but I continued to spin my wheels until I found a way to articulate, in my own words, how to reconcile the challenge with my own supervisory responsibilities. I needed a compass to guide me for whatever hot requirement arose– be it a flavor-of-the-month request or pressures from my superiors, technicians, inspectors, auditors or finance department.

I decided that a list of five priorities, in order of importance, would be my compass regardless of the situation.

#1: Safety. No task is worth risking the safety of our customers or each other. We will ensure the safety of the users of our products by making sure we take the time and steps necessary to achieve the level of quality necessary. To ensure the safety of our co-workers and ourselves, we will follow the guidelines in our organizational policies, and we will have a monthly “stand-down” to ensure safety items are in place.

#2: Compliance is a checklist for safety; we will follow our policies, processes, and technical manuals.  Naturally, organizations that are not in compliance are shut down.  We will work to revise the processes that can be improved.  In the monthly stand-down, we will include time to audit ourselves to ensure that we maintain compliance.

#3:  Quality. We will perform our tasks to the point where we meet all of our technical requirements, do the job right the first time and improve the length of time between removals. To be most effective, we will focus extra attention on the top five issues that affect the quality of our outputs.

#4: Productivity. We will enjoy increases in productivity through safety, compliance and quality. However, we must constantly look for ways to reduce effort through process improvement and staying focused on the job at hand.

#5: Economy. To improve job security in an increasingly competitive environment, we must try to find less expensive ways to execute our processes without compromising safety, compliance or quality.

I tested the order of these priorities against all the metrics that I was being held accountable for as well as any operational emergencies that might arise, and I found I could easily come to a resolution with integrity each and every time. Now the challenge was to get buy-in from my organization.

My first move was to share the priorities with peer managers and higher management to make sure there were no holes in the thought process. The list was received well – in fact, the priorities were implemented in a similar form in the higher organization.

The next step was to win over the technicians.  By giving credence to their dilemma and providing them with a tiered decision-making strategy with safety as the top priority, I was able to reassure them that they would not have to compromise their integrity for the organization’s goals.  The monthly stand-down demonstrated that safety and compliance were regarded above productivity and economy. This gave us unity of purpose as we implemented a very successful process improvement initiative that lowered costs and increased quality and productivity.

Finally, to maintain emphasis on the priorities, I changed the weekly staff meeting to a daily battle rhythm. The shorter daily meeting started with direct reports to discuss operational issues. Then each day of the week focused on one of the five priorities:  Monday included safety representatives; Tuesday, compliance representatives; Wednesday, engineers for quality improvements; Thursday, green and black belts for productivity; and Friday, finance representatives for economy.

Speed and discipline really are compatible. The key is that leadership must make these five priorities explicit and use all five in the decision-making process, never allowing the push for improvement to rank ahead of safety, compliance and quality.

Bill Peterson is a lean consultant and practitioner and creator of the workshops Lean Applied to Business Processes, Disciplines of Speed, and Lead Smarter. He teaches in the University of Tennessee’s Department of Graduate and Executive Education.

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The S3 Story: Due Diligence as a Business Advantage

By Aksel Sidem, General Manager, S3 International © 2014 Aksel Sidem ALL RIGHTS RESERVED

S3 International has been in the military and commercial spare parts industry since 2005. S3 Repair Services, a subsidiary of S3 International, is an FAA-certified Repair Station that offers efficient and cost-effective repair and overhaul solutions with the highest quality.  We’re based in Milwaukee but our business has us working and competing globally. In fact, the great majority of our work is in international markets, and we’d like to see that sector continue to grow.

The field is a fragmented one with both multinational companies and mom-and-pop vendors vying for a piece of the estimated $58 billion pie. Accordingly, any point of differentiation that allows us to establish a competitive advantage is one we’re going to consider.

In 2013, S3 had the opportunity to initiate a distribution agreement with a major original equipment manufacturer (OEM).  The business was sizable and the possibility of establishing a relationship was too good to pass up. One of the requirements of the new business proposal was that S3 provide proof of a robust anti-bribery due diligence compliance system. We knew we were compliant, but we needed documentation.

Integrity, Quality and Innovation

Since our founding, S3 has been committed to customer service, superior innovation and working with integrity. We’re accredited by Det Norske Veritas (DNV) under ISO 9001:2008 and EN/AS9120:2009; and by the Aviation Suppliers Association under the ASA-100 quality standard. The company has been a member of good standing of the ARSA for four years. Good corporate citizenship is a hallmark of how we conduct our business, so undergoing a due diligence review process was one we welcomed as an illustration of our seriousness about anti-bribery compliance.

The prospective business partner specifically asked us to undergo TRACEcertification conducted by TRACE, an internationally recognized anti-bribery standard setting organization. TRACE works with businesses in the global marketplace to enhance transparency by providing due diligence, compliance tools and training. TRACEcertification is a comprehensive review and approval process based on internationally accepted due diligence procedures that provides certified entities with portable compliance information. So, not only would the report meet the compliance requirements of this prospect, but we could reuse the information on an as needed basis with other global and governmental partners.

While we were familiar with such certifications, none of our customers had ever required us to complete one in the past, so our first step was to investigate the advantages of such a comprehensive review. We realized the regulatory landscape was quickly evolving though, and with increased oversight in the U.S. and abroad we could see that to get this business and put ourselves ahead of the competition,a recognized international certification was a must.

The Compliance Process

The process was pretty straightforward, mainly because we had a due diligence analyst who walked us through the process. TRACE has different degrees of reporting based on where you do business, how many partners or vendors you work with, your own company’s history, and other risk-sorting factors. After reviewing the options, we agreed that TRACEcertification was appropriate for S3. (I should note that S3 also applied for – and got — a TRAC number, a company-specific identification number that multinational companies can use to search for baseline compliance information. Both levels of due diligence include screening against all major watch lists on a daily basis.)

I completed the paperwork, provided the necessary information regarding our financials, ownership and reputational screening. I was able to turn around the papers within a few weeks. In all, the whole process took two months at most and we were TRACE certified. It was easy.

What It Means: More Business

First, let me say that we got the distribution deal with the major OEM which initiated the compliance verification process.

Aside from documenting our compliance, having a recognized international certification enhances our corporate image. It differentiates S3 from the competition and shows a certain seriousness about being compliant. It signals that we aren’t just saying we are an ethical company but by working with a partner who is committed to international transparency, we’re keeping good company.

Additionally, having the compliance documents ready to go opens a lot of doors for us and tends to speed the pace of business. The discussion doesn’t get stuck on compliance issues. We can honestly say – and prove – “Yes, we’re compliant. Let’s move on.” In fact, we’re courting other OEMs and have found that our existing certification meets their requirements as well– drastically reducing the time and red tape involved in the process.

The compliance requirement works on both sides of the supply chain at S3. Our partners require due diligence proof from us, and we’ve started looking for similar affirmation from our suppliers. Just as having that documentation can move us to the head of the line, the same goes for partners looking to work with us.

On our website, S3 proudly illustrates our various professional affiliations. Like memberships in a Milwaukee civic organization or ARSA, we view our TRACEcertification and TRAC number as marketing tools that reinforce the fact that S3 is a good global citizen and a trustworthy business partner committed to transparency.

The overarching lesson is when your company has committed itself to doing good work in the right way, your mission should be to ensure the world knows. Find the resources that are available to you – and recognized by your strategic partners – to help tell that story.

S3 International is the parent organization of S3 Repair Services, which is based in Milwaukee, Wisc. and has been an ARSA member since 2010.

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Membership

 “Teaching You How to Fish” – Answering A letter of Investigation

By Ciara Chambers, Communications Intern

Access to regulatory, business, and legislative knowledge is one of the key benefits of ARSA membership. We are standing by for your calls, questions, or clarifications. The association will go a step further, though, and give you the tools to build your own knowledge before the problem even arrives.

Our recorded webinars and training sessions are one way ARSA will “teach you how to fish.” They’re all waiting for you; you can start a session right now.

Featured Session

One of the featured training courses available through ARSA is “How to Answer a Letter of Investigation.” In this session, ARSA Executive Director Sarah MacLeod outlines the steps for a company to take in order to answer a letter of investigation from the FAA in writing.

Regardless of the alleged violation, a company will want to handle the scenario in the same way, with a written response. As an “alleged violator”, this is how you tell your side of the story. MacLeod describes the effective format to properly respond to all of the allegations in a factual manner.

You don’t have to panic when you receive an LOI. Take 30 minutes right now to prepare yourself: sign up to view Sarah MacLeod’s training webinar here.

 

Member Spotlight – S3 Repair Services, Milwaukee, WI

By Kelsi Oliver, Communications Coordinator

s3repairlogo

S3 Repair Services is compliant and they know it. The repair station prides itself on meeting the highest possible standards of both product value and corporate ethics. A subsidiary of S3 International, they boast high quality, rapid turn times and reduced repair costs. An ARSA member since 2010, S3 provides efficient and cost effective repair and overhaul solutions to their customers.

The company provides repairs for airframe and engine accessories, engines, avionics, auxiliary power units, landing gear, propellers and structures. A particularly customer-friendly option gives users an around-the-clock online portal to check incoming inspection, evaluation reports and test results.

When asked the most interesting thing S3 Repair Services is working on now, Business Development Manager Nicholas Weissenborn detailed growth in their pneumatics, hydraulics and electromechanical components. “As the volume of work increases, we continue to equip our newly-renovated 15,000 square foot facility, while adding experienced aerospace technicians who will continue to reinforce the strong reputation with our customers,’ Weissenborn said.

S3 Repair Services is no stranger to seizing good business opportunities and taking advantage of good business practices. Their parent company, S3 International, has completed a review by TRACE, who granted its TRACEcertification in recognition of the company’s robust anti-bribery due diligence compliance system. S3’s TRACEcertification marks their devotion to transparency in international commercial transactions and ensures a stronger workplace for all.

Read their other piece in this month’s hotline where S3 International General Manager Aksel Sidem details why certification is of particular importance and why your company should employ due diligence to demonstrate your company’s standards for the world.

For more information about S3 Repair Services, click here.

Are you an ARSA member who would like to be in the “Member Spotlight?” If so, please contact Kelsi Oliver at kelsi.oliver@arsa.org.

 

Have You Seen this Person?

Each month, the hotline spotlights key regulatory, legislative, and business leaders making important contributions to the aviation industry. This month we look at John Sammons of the Transportation Security Administration.

Assistant Administrator for Office of Security Policy and Industry Engagement, John P. Sammon, Transportation Security Administration

John P. Sammon

Created in the wake of 9/11 and housed in the Department of Homeland Security as of 2003, the Transportation Security Administration’s (TSA) goals are two-pronged: to enable secure transportation for our nation and to allow freedom of movement for people and commerce.

John P. Sammon, as assistant administrator for Office of Security Policy and Industry Engagement, works toward this combined mission to protect and secure our multiple transportation systems. These include aviation, rail, transit, maritime, cargo, highway and energy pipelines.

With a background full to the brim of valuable experience, Sammon has managed customer networks for railroads, motor and ocean carriers, petrochemical manufacturers, ports and other public agencies. Various jobs at software venture e-Carload and in the railroad industry with CSX and Conrail comprise 25 years of transportation business development, operations and change management.

Sammon and ARSA have crossed paths recently as ARSA has been working with the TSA on their repair station security rule. ARSA has been working on behalf of the industry to ensure clarity and consistency of the agency’s regulations. Read on in the hotline here about ARSA managing the intersection of government and business through their interaction with the TSA.

To learn more, visit tsa.gov.

 

Take Advantage of ARSA’s Members Getting Members Program, Get 10% Off on Membership Dues

The best form of advertising is word of mouth. Use the Members Getting Members Toolkit to recruit an ARSA member and your company will receive a discounted membership rate for your next membership term. Get more information at http://arsa.org/membership/members-getting-members/

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Target Your Message: Advertise Today in ARSA’s Newsletters and Website!
ARSA recently updated its menu of advertising opportunities for arsa.org, the hotline and the ARSA Dispatch. Take advantage of these great opportunities today to showcase your company, a new product or event. For more information go to http://arsa.org/advertise/

Exhibit, Sponsor the 2015 Repair Symposium

As the maintenance industry’s top event devoted exclusively to regulatory compliance, the ARSA Symposium attracts a highly qualified professional audience. Use this opportunity to promote your company while showing support for ARSA. Get more information at http://arsa.org/news-media/events/arsa-symposium/arsa-annual-repair-symposium-sponsorship/

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A Member Asked…

Q: Three ARSA members (two repair stations and an air carrier), contacted the association within hours of each other. Their issue: a United States foreign repair station received articles overhauled in Canada and installed them on engines destined for the United States. A Federal Aviation Administration (FAA) inspector mistakenly claimed that the foreign repair station cannot use parts from Canada for installation on the U.S. airlines’ engines. Until resolution is reached, the foreign repair station does not feel it can ship the engines.

A: It is clear from the regulations and the MIP that any repair station, foreign or domestic, working under the authority of its Federal Aviation Administration (FAA)-issued part 145 air agency certificate may use persons to perform maintenance in Canada under Transport Canada-issued approved maintenance organization certificates (AMO).

In other words, 14 Code of Federal Regulations (CFR) authorizes Canadian AMO’s to perform and approve for return to service maintenance, preventive maintenance and alterations in Canada on and/or for U.S. aeronautical products.

The applicable regulations are:

§ 43.3   Persons authorized to perform maintenance, preventive maintenance, rebuilding, and alterations.

(a)  Except as provided in this section and § 43.17, no person may maintain, rebuild, alter, or perform preventive maintenance on an aircraft, airframe, aircraft engine, propeller, appliance, or component part to which this part applies. Those items, the performance of which is a major alteration, a major repair, or preventive maintenance, are listed in appendix A.

§ 43.7   Persons authorized to approve aircraft, airframes, aircraft engines, propellers, appliances, or component parts for return to service after maintenance, preventive maintenance, rebuilding, or alteration.

(a)  Except as provided in this section and § 43.17, no person, other than the Administrator, may approve an aircraft, airframe, aircraft engine, propeller, appliance, or component part for return to service after it has undergone maintenance, preventive maintenance, rebuilding, or alteration.

(c)  The holder of a repair station certificate may approve an aircraft, airframe, aircraft engine, propeller, appliance, or component part for return to service as provided in Part 145 of this chapter.

§ 43.17   Maintenance, preventive maintenance, and alterations performed on U.S. aeronautical products by certain Canadian persons.

(a)  Definitions. For purposes of this section:

Aeronautical product means any civil aircraft or airframe, aircraft engine, propeller, appliance, component, or part to be installed thereon.

(b)  Applicability. This section does not apply to any U.S. aeronautical products maintained or altered under any bilateral agreement made between Canada and any country other than the United States.

(c)  Authorized persons.

(1)  A person holding a valid Transport Canada Civil Aviation Maintenance Engineer license and appropriate ratings may, with respect to a U.S.-registered aircraft located in Canada, perform maintenance, preventive maintenance, and alterations in accordance with the requirements of paragraph (d) of this section and approve the affected aircraft for return to service in accordance with the requirements of paragraph (e) of this section

(2)  A Transport Canada Civil Aviation Approved Maintenance Organization (AMO) holding appropriate ratings may, with respect to a U.S.-registered aircraft or other U.S. aeronautical products located in Canada, perform maintenance, preventive maintenance, and alterations in accordance with the requirements of paragraph (d) of this section and approve the affected products for return to service in accordance with the requirements of paragraph (e) of this section.

(d)  Performance requirements. A person authorized in paragraph (c) of this section may perform maintenance (including any inspection required by Sec. 91.409 of this chapter, except an annual inspection), preventive maintenance, and alterations, provided—

(1)  The person performing the work is authorized by Transport Canada Civil Aviation to perform the same type of work with respect to Canadian aeronautical products;

(2)  The maintenance, preventive maintenance, or alteration is performed in accordance with a Bilateral Aviation Safety Agreement between the United States and Canada and associated Maintenance Implementation Procedures that provide a level of safety equivalent to that provided by the provisions of this chapter;

(3)  The maintenance, preventive maintenance, or alteration is performed such that the affected product complies with the applicable requirements of part 36 of this chapter; and

(4)  The maintenance, preventive maintenance, or alteration is recorded in accordance with a Bilateral Aviation Safety Agreement between the United States and Canada and associated Maintenance Implementation Procedures that provide a level of safety equivalent to that provided by the provisions of this chapter.

(e)  Approval requirements.

(1)  To return an affected product to service, a person authorized in paragraph (c) of this section must approve (certify) maintenance, preventive maintenance, and alterations performed under this section, except that an Aircraft Maintenance Engineer may not approve a major repair or major alteration.

(2)  An AMO whose system of quality control for the maintenance, preventive maintenance, alteration, and inspection of aeronautical products has been approved by Transport Canada Civil Aviation, or an authorized employee performing work for such an AMO, may approve (certify) a major repair or major alteration performed under this section if the work was performed in accordance with technical data approved by the FAA.

(f)   No person may operate in air commerce an aircraft, airframe, aircraft engine, propeller, or appliance on which maintenance, preventive maintenance, or alteration has been performed under this section unless it has been approved for return to service by a person authorized in this section.

In this case, the work was performed and approved for return to service in Canada under the provisions of the U.S./Canadian bilateral. Both the work on the component in Canada and the engine in Brazil are specifically authorized by part 43 (see, sections 43.3 and 43.7 above). Further, the Brazilian repair station must follow sections 145.201(a), 145.217 and 145.219(a).

The confusion may be that the part was installed in Brazil; however, the bilateral contemplates that by stating its terms apply to articles that transfer from the jurisdiction of one authority (TCCA, in this case) to the other (in this case FAA). When the Brazilian-located U.S. part 145 foreign repair station performs work, it must do so under part 43, just like any U.S.-located repair station. In other words, when it exercises the privileges of its FAA-issued part 145 air agency certificate, it is under the jurisdiction of that authority! See, U.S./Canada Maintenance Implementation Procedures, Chapter 2, Paragraphs 2.0(b) and (c) (page 5 (or 7 of 17 if reading in Adobe mode)).

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Regulatory Compliance Training

Test your knowledge on § 145.155 ratings.

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AVMRO

ARSA strives to provide resources to educate the general public about the work of the association’s member organizations; should you need to provide a quick reference or introductory overview to the global MRO industry, please utilize AVMRO.ARSA.org.

 

AVMRO Industry Roundup

ARSA monitors media coverage on aviation maintenance to spread the word about the valuable role repair stations play in their communities by providing jobs and economic opportunities and in civic engagement. These are some of this month’s top stories highlighting the industry’s contributions.

AIA names Faoro vice president for membership services and business development (AIA Aerospace)

Keystone Aviation donates aircraft to community college (AIN Online)

Ribbon cut on tech school’s new aviation maintenance program (The McDuffie Progress)

Clay Lacy donates two jets to Van Nuys A&P school (AIN Online)

AAR becomes the first MRO operator to sign data-sharing pact with FAA (AAR Corp.)

LORD Corporation announces channel partner alliance with Aero Products Component Services, Inc. (Helicopter Association International)

Aviation Institute of Maintenance joins Imagine America Foundation scholarship program (Aviation Pros)

Nejets first to reach new safety level (Aero-News Network)

Gulfstream donates business aircraft to Savannah Technical College (Aviation Pros)

New materials promise self-healing airplanes (AV Web)

Wichita Falls Flight School receives FAA accreditation (Texoma Home Page)

TIMCO secures CRJ200 interiors modification program (Aviation Pros)

Metro delivers law enforcement aircraft to Seminole County(Helicopter Association International)

SkyWest considering Boise for $20-30 million maintenance building (Aviation Pros)

FAA raps up data-sharing efforts to enhance global airline safety (Wall Street Journal)

EagleMed Air Medical Transport selects Metro Aviation for helicopter flight sim training (Rotor News)

Gulfstream opens west coast parts distribution center (AIN Online)

Heico subsidiary acquires aviation parts company (Miami Herald)

GE Aviation is poised for solid growth in the coming years (NASDAQ)

Open house celebration for business aviation’s newest state-of-the-art aircraft maintenance facility (Aviation Pros)

TIMCO opens new line services locations (AVI Trader)

AAR CEO pledges $350K to support STEM education at Miami youth center (Aviation Pros)

Floridians in flight: New report shows aviation maintenance vital to state (General Aviation News)

New Kansas City repair station awarded FAA certification (Aviation Pros)

Southwest Airlines announces executive changes (Southwest Airlines)

Organizations offer range of training scholarships (AOPA)

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International News

IATA – Industry Celebrates Centennail in the Black

The International Air Transport Association (IATA) launched the Economic Performance of the Airline Industry report outlining how air transport is adding value for consumers, the wider economy, governments, and investors. The report illustrates how the airline industry continues to improve profitability through efficiency gains while connecting more cities, lowering transport costs, supporting jobs, and making major investments.

Global spending on air transport is expected to reach $746 billion in 2014, which equals 1% of world GDP. The number of passengers is expected to reach 3.3 billion as travelers benefit from a growing global network and airfares that are expected to fall 3.5% in real terms (after inflation). Businesses are also benefiting from the growth in connectivity and a 4% fall in freight rates, after inflation. 

Click to read more…

 

International Roundup

To provide more international coverage, ARSA presents a monthly roundup of world events pertaining to the industry.

We’re flying into an aviation skills crisis, with safety under the radar (The Conversation)

70th IATA AGM: A global mindset for commercial aviation’s next century (Air Transport News)

Airline industry to face rapidly expanding competition, according to PsC US (PricewaterhouseCoopers)

Commercial aircraft maintenance, repair and overhaul market 2014-2024 (PR Newswire)

Air Canada’s Rovinescu is the new IATA chairman (ATN AERO)

Regulations must be global, says IATA Chief Tony Tyler (The Australian)

WW2 planes fly to Normandy to mark D-Day 70th anniversary (BBC)

HAECO opens new component MRO facility at Xiamen (HAECO Ltd.)

Nigeria: Federal government to build aircraft maintenance school in Anambra (All Africa)

Dassault Falcon Jet to provide comprehensive operator support for the 2014 FIFA World Cup (Aviation Pros)

StandardAero Singapore signs agreement to become first independent Rolls-Royce authorized MRO facility for RR300 helicopter engines in Asia (Aviation Pros)

PPG Aerospace adds packaging capabilities at site in France (MRO Magazine)

Gulfstream Brazil moves to larger hangar ahead of World Cup (Corporate Jet Investor)

India: aviation sector will create 350,000 jobs in the next decade (The Hindu Business Line)

FL Technics Training signs a technical training agreement with Aeroman (FL Technics)

FAA ramps up data-sharing efforts to enhance global airline safety (Wall Street Journal)

IATA April premium air traffic growth: summary (Bloomberg)

ExecuJet Mx Tianjin, China open for business (AIN Online)

Embraer welcomes Tianjin Airlines as AHEAD-PRO system launch user in China (Aviation Pros)

Etihad and Air New Zealand to share maintenance services (Australian Aviation)

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Upcoming Events

EAA AirVenture – Oshkosh, Wisconsin – July 28-Aug. 3, 2014

Previous issues:

2014: Jan Feb Mar Apr May
2013: Jan Feb Mar Apr May June July
Aug Sept Oct. Nov Dec.
2012: Jun Jul Aug Sep Oct Nov Dec

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