Defense of AMS Flexibility, Efficiency, and FAA Procurement Needs

---

Summary

• The AMS is a unique system created and tailored to meet the procurement needs of the FAA, including flexibility, efficiency, and life-cycle management.
• While it has its areas for improvement, the things that make the AMS unique are also the things that make it a better option than the FAR for FAA procurements.
• The FAA has had some difficulties with major initiatives like NextGen, but more effective usage of the AMS’s strengths would reduce these issues going forward.

stellalevi/E+ via Getty Images

Jump to:

---

---

Abstract

The Federal Aviation Administration (FAA) has no small task: it must regulate, update, and upgrade the most sophisticated commercial aviation system in the world, all while prioritizing safety above all else. This Note argues that the FAA’s unique Acquisition Management System (AMS) is the best and most efficient way to accomplish these tasks, despite the difficulties that it has faced. Since the 1990s, there has been a major push to update the entire National Airspace System (NAS) from top to bottom, including developing and implementing technology that has never been used before. The NAS connects all aviation in the United States and consists of everything from radar dishes and satellites to software and air traffic controllers. A procurement effort like this requires a robust and flexible system that is sufficient, not just to acquire the technology, equipment, and services in the first place, but also to oversee their implementation and management throughout their life cycle. In 1996, the FAA created a new acquisition system to replace the Federal Acquisition Regulations (FAR) used throughout much of the federal government, which was seen as prohibitively rigid and too slow to meet the needs of the FAA. This new system, the AMS, has been built to promote cost and time efficiency in procurement and to allow flexibility in response to a quickly evolving industry and procurement environment. The AMS has filled this role well, and its success in achieving these goals is particularly visible through the varied projects of the NextGen initiative, the FAA’s name for its system-wide NAS upgrade, which will now continue through the newly announced Air Traffic Control (ATC) modernization efforts. The AMS and its usage are not without error, and there is always room to improve, but overall, the AMS is in the best position to meet the needs of the FAA and encourage cost and time efficiency in procurement, as directed by Congress.

---

---

---

---

I. Introduction

As of 2024, the U.S. federal government was the largest individual buyer for goods and services in the world, with most of these purchases made by executive branch agencies, such as the National Aeronautics and Space Administration (NASA), the Department of Defense (DoD), and, the subject of this Note, the Federal Aviation Administration (FAA). Most of these executive branch agencies guide their procurements and acquisitions using the Federal Acquisition Regulations (FAR), a set of regulations written and maintained jointly by the Secretary of Defense, the Administrator of General Services, and the Administrator of NASA.

Despite the FAR being the most common standard for government procurement in executive agencies, some agencies are exempted from the FAR, including the FAA. The FAA has a variety of constantly evolving duties, such as regulating civil aviation, adopting emerging technologies, aiding in the research and development of aviation and air traffic control systems, managing U.S. commercial space transportation, and, most relevant here, developing and maintaining the National Airspace System (NAS). Underscoring all of these duties is the FAA’s number one priority: preserving and promoting safety above all else. On November 15, 1995, the 104th Congress enacted the Department of Transportation and Related Agencies Appropriations Act of 1996, which, among other things, mandated that the Administrator of the FAA “shall develop and implement . . . an acquisition management system for the Federal Aviation Administration that addresses the unique needs of the agency and, at a minimum, provides for more timely and cost-effective acquisitions of equipment and materials.” This Act also exempted the FAA from adhering to a variety of major federal acquisition laws, such as the Competition in Contracting Act (CICA), the Small Business Act, and most importantly, the FAR. In response to this Act, in 1996 the Administrator of the FAA released the first version of the Acquisition Management System (AMS), a new set of policies, guidance, and contracting documents to guide all acquisition and procurement for the FAA.

This new AMS was created to promote efficiency in terms of both time and money spent on FAA acquisitions, a goal that it seeks to accomplish by allowing for more discretion and business judgment in contracting, as well as by managing the entire life cycle of an acquisition. This development has led to a system with a fundamentally different approach than the FAR, which is used by most other executive agencies, and raises many questions. Has the AMS accomplished its stated goals? How can the AMS be improved? Is this experimental acquisition system better than the FAR, which the AMS was to improve upon? This Note will seek to answer these questions and assert that, even in the face of some performance shortcomings, the AMS is still the best option for meeting the needs of the FAA. This Note argues that the FAA should continue to use and develop the AMS as the best path forward to achieve the stated goals of reducing costs and promoting efficiency in FAA procurements. The AMS meets these goals by giving procurement officials flexibility to adjust to the rapid evolution of both technology and business practices in the government procurement industry, and by managing and accounting for the entire life cycle of procurements. Furthermore, when FAA procurements fall short of these goals, these difficulties are more reflective of the failure to effectively apply the AMS than flaws of the AMS itself. The effective usage of the AMS will be particularly crucial during the new Air Traffic Control (ATC) modernization process recently announced by the Department of Transportation (DoT).

II. Foundations of the Acquisition Management System

This part will discuss a brief history of the AMS, its key attributes, and how they attributes work to achieve Congress’s goals for the AMS as enumerated in the 1996 Department of Transportation and Related Agencies Appropriations Act. This Act mandated that the Administrator of the FAA, with optional help from nongovernmental acquisition experts, create a new acquisition management system that addresses the needs of the FAA and improves the timeliness and cost-effectiveness of the acquisition process. This revamp of the FAA’s acquisition process was part of a major reform and modernization of the FAA that started in late 1981, when the FAA began to upgrade the equipment and facilities of the NAS. This comprehensive reform was mandated in an effort to make the FAA a more efficient, effective, and updated organization to meet future challenges. Congress concluded that the FAA’s way of doing business then, from personnel management and system modernization to the acquisition process, was insufficient to meet the growing demand for commercial aviation in the United States, or to keep pace with the technological advancements required by the extra burden on the system. The AMS was created with these future objectives in mind and was intended to more efficiently procure the technology, equipment, and service needs of the FAA, in light of the blossoming commercial aviation industry.

A. Key Attributes of the AMS

To understand the AMS, it is crucial to recognize the “key attributes” that the creators had in mind. Six key attributes were explicitly listed in the FAA’s 1997 revision of the AMS, and they provide a useful lens to better understand the AMS and its evolution over time. For the sake of clear discussion, these six attributes will be grouped into three categories: (1) effective operations, consisting of the first two attributes; (2) oversight, consisting of the third through fifth attributes; and (3) public trust, which is the sixth attribute standing alone.

Within the “effective operations” category, the first attribute is effectiveness, which motivates the procurement of products that meet the specific and evolving needs of the FAA. This concept combines closely with the next attribute, flexibility. The AMS is not focused on rigid adherence to restrictive rules; it instead prioritizes discretion and good business judgment to achieve a procurement outcome that is most effective to meet the needs of the FAA. The next attribute in this category is efficiency, which combats wasted resources and undue oversight. This mandate aligns with the overarching goal of streamlining the procurement process, which inspired the initial creation of the AMS.

The first attribute of the “oversight” discussion category is “checks and balances.” This attribute is focused on identifying and correcting problems early, an area where the AMS still has room to improve. Next is the “assurance of balance,” which weighs the importance of certain procurement requirements alongside the technological capabilities of industry. This is particularly relevant to the cost-effectiveness goals of the AMS, which are structured to meet the industry where it is, and refine requirements based on existing technology.

The final attribute, which merits its own category for discussion, is “public trust.” In many government agencies, public trust is centered on honest and clear communication with the industry and the public alike. The AMS was a new and radical approach to procurement; therefore, transparency and clear communication were and continue to be particularly crucial to its success.

In summary, an understanding of these key attributes that the AMS was founded on is crucial to understanding the AMS itself and to understanding the evolution of the AMS over time and in the future. As this Note will further discuss, the effective application of these attributes can be most readily seen in major procurement initiatives, such as the NextGen project, and prospectively in the new modernization efforts recently announced by the DoT.

B. How the AMS Sought to Improve on the Existing FAR-Based Acquisition Process

The modernization of the NAS involved updating and upgrading the entire air traffic control system from towers to satellites, to radar dishes, to a wide variety of other technologies and pieces of infrastructure across the country. This process was a tremendous undertaking for the FAA, and it has been far from seamless. Throughout the process, the FAA’s modernization project “has experienced cost overruns, schedule delays, and performance shortfalls of large proportions.” The FAA stated that these bumps in the road, in part, were a result of some of the federal regulations on acquisition and personnel management. Particularly relevant here was the FAR, which was seen as somewhat rigid and prescriptive, restricting the FAA from maintaining the pace necessary to keep their technology up to date.

In 1996, the Administrator of the FAA signed the AMS into existence to address these concerns and to meet the statutory mandate for improved efficiency of cost and time in procurements. In a 1996 congressional hearing before the House Technology Subcommittee of the Committee on Science, Dr. George L. Donohue, the Associate Administrator of the FAA at the time, explained the three main areas of progress targeted by the new AMS, areas where the FAA wanted to improve on the restrictions of the FAR and improve the efficiency of the acquisition process.

The first of these areas for improvement related to the requirements of the acquisition process. The FAA found that the process was mired by “requirements churn,” which is where requirements continuously change, making it difficult to hold contractors to one testable standard, continuously interrupting the production and procurement cycle. Although “requirements churn” was not mentioned as a unique deficit of the FAR, the AMS has nonetheless sought to improve efficiency of procurement by working more closely with the operator teams to clearly define requirements for each step of the procurement cycle, reducing changes that slowed procurements and delayed project completion. Additionally, the improvements to the requirements included a focus on commercial products, reducing the need for unique products created specifically for the FAA, thus diminishing the burden on industry partners. This focus allowed for interruptions and issues to be resolved more quickly by using products already available on the market. Creators of the AMS hoped that, together, these strategies would work to streamline the requirements of FAA procurements, decreasing wasted time and resources.

The second area for progress that the AMS targeted was procurement regulations. This area was built on a significant difference from the FAR, a difference between standards of competition in the procurement process. Under the FAR, procuring agency Contracting Officers (CO) are generally required to promote “full and open competition.” This process is lengthy and can result in slower procurements. Conversely, in the AMS, despite a preference for competition in procurement, the FAA is relatively free to procure items from a single source if it supports the mission of the FAA. This difference in competition requirements paved the way for the new AMS system to maximize the efficiency of simplified acquisition procedures and to streamline the evaluation process for bids. This was done in a few ways. First, the AMS streamlined the process of assembling a Qualified Vendors List (QVL) by primarily relying on market surveys and past performance to list vendors with a proven track record instead of opening competition to all potentially capable contractors. Second, the AMS allowed the FAA to discuss procurement requirements directly with potential vendors, including during the bidding process. The FAR prohibited this and required the slower “full and open” process, whereas the AMS process allowed the FAA to more efficiently assess what the market could produce, encouraging modernization and the procurement of advanced and emerging technologies.

The AMS removed the requirement of providing certified cost and pricing data for each procurement. The FAR requires this cost and pricing data, and this requirement is reflective of the “paradigm” that goods and services procured by the DoD must be newly developed for government use. While this paradigm has shifted to a government-wide preference for commercial items, the FAR requirement of providing certified cost and pricing data is emblematic of the differences between the two procurement systems. In contrast, the FAA operates in a field where commercial technology and equipment are constantly improving, often even faster than government procurement. This strong preference for commercial items allows the FAA to conduct market research and to take advantage of competition within the industry sector to obtain lower prices. Together, these changes to acquisition procedures were some of the most significant changes brought on by the AMS as well as some of the greatest differences from the FAR.

The third and final area of improvement that the AMS promoted was adding life-cycle management to the procurement process. This area transcended the realm of acquisitions and branched even further into personnel and project management strategy. Under the best practices model of the U.S. Government Accountability Office (GAO), COs are responsible directly to contracting officials higher up the chain, creating a direct chain of responsibility and accountability. This accountability discourages delegation and requires closer monitoring of procurement delivery dates and any issues that arise in the acquisition process, which naturally slows progress. This approach was explicitly changed by the AMS, which instead placed procurement personnel on Integrated Product Teams (IPTs), which later evolved to become the Product and Service Teams (PSTs) today. These teams include not only procurement personnel, but also engineers, operators of technology and equipment, and representatives from the various factors affecting a procurement, such as risk management. This arrangement encourages collaboration and effective delegation to the team member best equipped to address a particular question or issue.

In addition to this unique acquisition management structure, the AMS also puts a focus on life-cycle acquisition. As the name implies, life-cycle acquisition means considering and implementing the steps necessary to utilize and maintain a system throughout its existence. This structure combines the initial procurement with the maintenance and upkeep required for continued use. This was done to build trust and responsibility between the operators who use the acquired goods, and the procurement officials who purchase them on behalf of the FAA. This new approach of life-cycle acquisition management was a fundamental tenet of the AMS, a key to understanding the true cost of acquisitions, thus promoting cost-effectiveness in procurement.

In summary, the AMS was created to increase the efficiency of the FAA’s acquisition procedures by improving the timeliness and cost-effectiveness of all FAA procurements. At its conception, it sought to achieve this goal in three main ways: (1) by clarifying and simplifying the requirements of FAA procurements, with a particular eye on increasing the use of commercial goods; (2) by relaxing procurement regulations that stem from defense-industry-specific needs; and (3) by restructuring acquisition management to place the focus on full life-cycle management. These strategies received bipartisan support from the House of Representatives Committee on Science when it was first created, but the question remains: how has the AMS evolved and is it succeeding in accomplishing its statutory goal of increasing FAA procurement efficiency in terms of timeliness and cost effectiveness? The next part of this Note will evaluate how the AMS has evolved to achieve those goals and then argue that it is still the most effective tool for this job.

III. The AMS Is Actively Evolving to Achieve the Goals of Improved Cost and Time Efficiency, Although Areas for Improvement Remain.

Since its inception, the burden on the AMS to guide the procurement and life-cycle management of every aspect of the NAS has grown exponentially, as it is tied to the growth in volume and complexity of commercial air travel. With the exception of 2020 and the ensuing pandemic, commercial air travel has steadily increased year after year, and, if this growth continues as data suggests, aviation will soon reach new heights in terms of flights and popularity. In addition to traditional air travel, the FAA also has a variety of emerging technologies within its purview, including commercial space travel and the proliferation of unmanned aircraft. As one might imagine, this continued growth throughout the new ATC modernization efforts (and the related acquisition of new equipment and technology) has been and will continue to be a major stress test for the limits and capabilities of the AMS.

In addition to this already monumental task of procuring the equipment and technology to support the NAS, it is important to keep in mind the absolute guiding principle of the FAA: safety above all else. This crucial goal further complicates procurement as well as evaluation of the AMS because it means some cost-saving business considerations may be deprioritized in the face of promoting safety at all costs. This analysis brings back the original question: in the face of this priority for safety and the momentous task of keeping up with the demands of the NAS, is the AMS sufficient to efficiently and cost-effectively procure the needs of the FAA? To answer in short, despite areas for improvement highlighted by the GAO and in NextGen difficulties, the successes of the AMS so far point to yes.

A. The Areas for Improvement and Strengths of the Early AMS

The FAA was one of the first agencies given the opportunity to step back from the FAR, and many kept a watchful eye on the AMS to see how it performs. The FAA is a guinea pig of sorts for the main AMS principles of relying on CO discretion and business judgement, as well as managing and accounting for products and technologies from deployment to decommissioning, also known as “lifecycle acquisition management,” as part of the acquisition process.

As a result of this interest, decades ago the GAO published a thorough and comprehensive analysis of the AMS and its effectiveness, highlighting both the AMS’s successes and areas for continued improvement in its early times. This Note argues that the areas for improvement cast an unfairly pessimistic outlook on the success of the AMS. They failed to fully internalize the foundational premise of the AMS: on the one hand, its strength lies in the flexibility and discretion that it affords in procurement, and the value of this discretion should not be measured in comparison to the FAR or FAR-based industry practices, which are premised on a fundamentally different philosophy of regulation and rigidity. On the other hand, the successes are a reflection of effective and future-minded AMS policy, stemming from the AMS’s diversion from the more rigid and short-term management strategies of the FAR.

In the case of the AMS and its usage by the FAA, difficulties have not arisen because of the policy and guidance of the AMS itself, but instead result from ineffective implementation of acquisition management strategies. The 2004 GAO report does highlight some valid criticism of the FAA’s implementation of the AMS and its outcomes with acquisition management, but these failures in management, which resulted in issues such as cost or time overrun, are not reflective of the AMS system itself. Before elaborating on the successes of the AMS and its approach, this Note will examine the purported deficiencies and expound on why they are not, in most cases, a fair representation and analysis of the AMS and its potential.

1. The Areas for Improvement Highlighted by the GAO Were Not Consistently a Fair Evaluation of the AMS’s Acquisition Management Strategy

In its 2004 report, the GAO focused on one central issue and offered five recommendations mainly stemming from this single issue. The GAO claimed that the main issue was the FAA’s AMS and, more particularly, how the management decisions made in evaluating and approving each stage of an acquisition were not aligned with “commercial best practices.” These commercial best practices were determined based on major procurements by the DoD, which uses the FAR and the Defense Federal Acquisition Regulation Supplement (DFARS). With the fundamental differences between the FAR and the AMS, evaluating AMS acquisition management with a FAR-based approach will almost certainly uncover deviations from “best practices,” regardless of how effective the AMS approach may be in addressing its specific goals.

i. Decision-Making Structure Under the AMS

To compare this FAR-based process with the AMS-based process, it can be helpful to understand the corporate-level decision-making structure. Needless to say, the AMS allowing more discretion does not mean its procurement officials operate without high-level oversight; in fact, oversight is accomplished by the Joint Resources Council (JRC). The JRC is made up of an intentionally diverse array of specialized officers and experts within the FAA. It includes FAA administrators, legal counsel, acquisition executives, and corporate executives, such as a chief financial officer and chief information officer. Together, this team provides the executive oversight outlined in the following comparison of the FAR and AMS acquisition management and oversight processes.

ii. Comparing the FAR and AMS Procurement Processes

The GAO analysis focused on the comparison between when decision points required executive review and approval in the FAR and AMS processes. The first decision point in the FAR process comes after the “Concept and Technology Development” phase. This is the phase where an acquisition and its needs are planned, and potential solutions are put forward. This stage of the process is analogous to the AMS’s “Needs and Solution Identification” phase, even though the AMS process actually exceeds the FAR in corporate oversight in this stage.

In the AMS’s “Needs and Solution Identification” phase, comprising of mission analysis and investment analysis, three decision points require approval from the JRC. First, after mission analysis, the JRC must approve the “mission needs,” which are the refined requirements as defined by users in the field and the original writers of the mission need statement. This phase gets executive decision-makers on the same page as the boots-on-the-ground experts from the service organizations who are writing requirements and determining what the FAA actually needs from each procurement. Second, although still a part of this “Needs and Solution Identification” phase, the investment analysis process begins. This process requires both an initial and final investment decision from the JRC. This means that, at the most critical phase of an acquisition for determining its cost and timeline, two of the aspects most relevant to the AMS’s goals of improving cost and time efficiency, the AMS actually has more stringent requirements of executive oversight, and more opportunities for corporate-level decision-makers to understand and evaluate the guiding force behind a procurement, as well as its potential cost and timeline. The AMS places a greater focus on corporate executive-level oversight in these earlier stages than the FAR in order to allow for greater flexibility and speed in decision-making. It balances this early investment of high-level resources with a later reliance on product managers who are closer to the work itself. The FAR strategy of waiting on corporate approval throughout the process would likely be too slow to accomplish the efficiency goals of the AMS.

The next two decision points contained in the FAR-based process are where the AMS significantly deviates. The FAR process includes two corporate-level decision points during the “Product Development” phase, one after integration (where the product or solution is created and implemented in the existing system), and one after demonstration (where the product or solution is tested for corporate-level executive approval). In contrast, the AMS progresses from system integration to system demonstration, and finally to system production, without required executive approval from the JRC.

At first blush, it seems as though the GAO presented this course as an AMS deficiency. The GAO seemed to imply that the process moves forward without corporate-level oversight, and that the JRC take a “fire and forget” approach where they do all the legwork up front and then just trust the officers closer to the acquisition to see it through. This is not the case. Instead, in keeping with the overall strategy of the AMS, the focus is on giving the JRC discretion to hand off decisions to the experts and procurement officials who better understand the needs of the FAA in each specific procurement, as well as how to evaluate success accordingly. This method promotes efficiency in decision-making and elevates the expertise and proximity to the procurement of the FAA’s product teams. It does this primarily between the system demonstration and system production steps, where the JRC has the option to delegate this production decision to the service organizations that “own” the procurement.

The other aspect to note in this phase is that the FAR process has an executive decision point after the implementation phase and before the demonstration phase, whereas the AMS does not. This is a reflection of the additional work done by the JRC in the initial “Needs and Solution Identification” phase. By keeping a close eye in that phase to assure that this potential product or system is necessary and feasible for the goals of the procurement, it reduces the need for further design approval after integration and before the demonstration of the new product. This route again reinforces the AMS’s focus on giving discretion to the procurement officers closest to the work, increasing the efficiency of the procurement.

iii. Recommendations from the GAO Report and Their Implementation

With this overarching acquisition management strategy in mind, it should be noted that the GAO highlighted two legitimate concerns here. First, this approach places greater reliance on the requirement-writing phase of a procurement, an area where the FAA has had issues leading to cost and time overrun. Second, the AMS acquisition management strategy also requires that the data being used by the JRC and service organizations at crucial decision points must be comprehensive and paint a clear picture in order to maintain sufficient oversight over this more discretion-based approach of the AMS.

Due to the aforementioned issues and the problems that they have caused, such as cost and time overruns of large system procurements, three of the five recommendations that the GAO issued required greater scrutiny and more structure in the requirement-writing phase as well as clearer metrics for providing comprehensive data at the key decision points. The FAA concurred with these recommendations and implemented these three recommendations, while still maintaining discretion and efficiency, which are the hallmarks of successful AMS usage.

Of the other two recommendations proposed by the GAO report, the FAA only implemented one. The FAA concurred that it needed a more robust and structured approach to evaluating its acquisition workforce’s training process, but it did not implement the fifth and final recommendation asking the FAA to make the process for its acquisition management system mirror the corporate decision points of the FAR. As explained above, this change towards rigidity and more direct corporate oversight would have weakened some of the greatest strengths of the AMS: its efficiency and its ability to entrust decisions, even significant ones, to the capable hands of the service organizations and their product teams that are closest to the procurement. This approach was conditioned by the fact that the JRC still has the ultimate authority to retain these decisions if they deem it necessary.

2. The 2004 GAO Report Recognized the Benefits of the AMS’s Increased Flexibility and Discretion but Seemed to Oppose Giving the AMS Full Credit

The GAO report, although focusing on areas for improvements, also acknowledged the main strengths of the AMS as they pertain to not only acquisition management, but also to individual procurements. The beauty of the AMS’s discretion and efficiency is that it scales throughout the process, benefiting acquisitions at the highest and lowest levels of the procurement chain of command.

At the top, the JRC can pass off big decisions, such as sending a product or system into production, to service organization product teams that work most closely with system procurement. The system also benefits acquisitions at the lowest level, like in the procurement of individual pieces of technology as part of the larger system. The GAO gave a seemingly begrudging nod to this innovative pillar of the AMS. The flexibility and its usefulness were acknowledged by the GAO in its report, but the AMS was juxtaposed as being no better than or less useful than the FAR, despite many factors in the report indicating otherwise. This impression underscores a common deficit of the GAO report: measuring the AMS by the standards and goals of the FAR and its “best practices” used by other parts of the government, instead of the new goals that inspired the AMS. Using this incorrect lens can impair objectivity and reduce the effectiveness of the GAO’s evaluation. This concern can then have an outsized impact on how the AMS is evaluated in the future, as the GAO and other internal evaluation systems often draw on previous GAO reports as their bases. This impact is why a critical evaluation of this dated GAO report is key to preserving the effectiveness of the AMS moving forward.

i. The GAO Did Not Evaluate the AMS with Its Specific Goals in Mind

In the section titled, “The AMS Is Broader and Less Prescriptive Than the FAR,” a variety of examples demonstrate that the GAO seemed to shy away from giving the AMS full credit for the value of its more flexible process. The GAO began by acknowledging that the AMS has a much wider scope than the FAR, primarily due to the inclusion of life-cycle management, whereas the FAR is mostly concerned with only the initial procurement and implementation. Governing this broader scope comes with its own challenges as discussed above, but it also provides yet another reason for the necessity of the AMS and its flexibility and efficiency in guiding the entire acquisition life cycle.

Then, the GAO moved into a more comparative stance, explaining that the AMS is not regulatory, but actually a system of guidance, whereas “the FAR is a set of published regulations. It has the force and effect of law, and agencies that are subject to it are bound to follow it.” The way that GAO presents this direction might give the impression that the AMS is somehow optional, and that COs need only follow that guidance in an arbitrary fashion. This is not the case, as the GAO itself identified to some degree by saying that “[the] AMS sets out a nonregulatory FAA policy that is binding on FAA personnel as FAA employees.” Additionally, the GAO seemed to highlight that the AMS lacks the structure and clear-cut rigidity of the FAR to the detriment of the AMS and the FAA’s greater acquisition efforts. This can be seen in the differences highlighted in the AMS’s acquisition management strategy, as well the nature of the AMS as a system of policy and guidance, instead of only firm regulations. This is not a design flaw, but in fact a design feature. What the GAO attempted to present as a negative, or at the very least, a potential liability, is actually one of the greatest tools of the AMS to promote efficiency. By permitting COs to disregard some pieces of guidance in certain cases and with sufficient justification, such as in the name of a more efficient procurement or securing a more optimal product for the needs of the FAA, the AMS brings an aspect of the commercial business industry that can lead to great success in the right hands: the effective use of discretion and sound business judgment.

The general tone of the GAO report remained the same throughout the next few sections comparing the AMS and the FAR. In this report focused on the effectiveness of the AMS, and an objective comparison between the two systems, a surprising amount of energy was placed into not only comparing the AMS to the FAR, but actually defending the FAR from wayward negative comparisons. For example, although some officials stated that the AMS provides more flexibility, efficiency, and options, the GAO made sure to clarify that some current and former officials who were familiar with both systems explained that “the FAR may appear inflexible and cumbersome to persons who lack experience with it, but those who are familiar with it are able to navigate its complexities effectively.” That may seem to insinuate that either the FAR is just as flexible as the AMS, despite the many sections of the report touting the FAR’s rigidity and mandatory structure, or that the user is simply not capable enough to make it so.

ii. GAO’s Disdain for the AMS’s Office of Dispute Resolution for Acquisition Highlights Some Common Shortcomings of the Report

Another “greatest hit” of the GAO’s somewhat dismissive attitude towards the AMS comes in describing the Office of Dispute Resolution for Acquisitions (ODRA), the FAA’s administrative law tribunal governing acquisition. The GAO states that “[the] FAA has adopted a dispute resolution process with some legal underpinnings.” This statement is a unique way to describe an administrative law tribunal that was mandated by Congress to adjudicate disputes under the AMS, and that is controlled by statute.

The ODRA has been a key aspect of the AMS’s success, allowing acquisition disputes, such as bid protests, to be settled within the FAA, in keeping with the policy, guidance, and principles of the AMS. The ODRA has the sole jurisdiction over AMS disputes, its rulings are binding on participants, and, as of 2024, of the more than 994 cases ruled on by the ODRA, which are subject to appeal in any federal circuit court besides the Federal Circuit itself, only one has been repealed, remanded, or modified by any court of appeals, which happened in 2022—after the most recent data sheet was compiled. Additionally, the ODRA has been a pioneer in the effective usage of mediation to settle disputes in a collaborative way, also called alternative dispute resolution (ADR), with sixty-six percent of bid protests and ninety percent of contract disputes resolved via ADR as of 2016.

The GAO’s apparent disdain for the AMS, the AMS’s derivative bodies like the ODRA, and the AMS’s priorities make it harder to analyze the true objectivity of the 2004 GAO report as it relates to the actual effectiveness of the AMS in managing acquisitions and achieving its goals of time and cost efficiency. Certainly, the report presents some legitimate criticisms backed by data, and several of the recommendations are an effective addition to the AMS circa 2004, but ultimately it failed to recognize the true benefits of the AMS and its potential.

As this Note has argued, no existing literature has sufficiently and comprehensively evaluated whether the AMS is the best tool to achieve the goals of cost-effectiveness and efficiency, and, in fact, almost no such reviews exist. Therefore, it may be more useful to look at the modern applications of the AMS to get a full picture of why it is the best option for the FAA to procure its needs in a cost-effective and timely manner. This Note next examines the successes and failures in the procurement of NextGen, the FAA’s process to majorly update the NAS, as well as briefly casting a prospective eye towards the recently announced new ATC modernization efforts, which will pick up where NextGen left off, and replace the remainder of the NextGen process.

B. The AMS Is the Best Tool to Maintain and Update the Safest and Most Effective Airspace System in the World

As the NAS continues to grow in both size and complexity, and the technical needs of the ATC system continue to evolve, the AMS has been and will continue to be the procurement tool used for procuring the necessary technology, software, real estate, and equipment for the FAA. To bundle these updating, upgrading, and expanding efforts under one roof, the FAA created the aptly named NextGen program, which set out to modernize the NAS and all of its related systems. The NextGen initiative was a tremendous undertaking by the FAA to update and upgrade every aspect of the NAS and particularly the ATC system. Recently, the FAA has announced that it will pick up where NextGen left off with a new effort to modernize the ATC. These efforts will continue to push the AMS to wider usage, and the FAA has demonstrated that, even with some imperfections and difficulties, the AMS has empowered the FAA to procure a variety of cutting-edge technologies and massive systems, deriving a huge benefit for the U.S. people and maintaining the United States as the gold standard in operating a safe and effective airspace.

Currently, all of NextGen’s major program infrastructure is projected to be implemented and in place by the end of 2025, with this program infrastructure leading to full system implementation of NextGen’s technologies by 2030. While newer data suggests that these projections are unrealistic, the existing pieces of NextGen will be wrapped into the newly announced and updated modernization strategy to build on NextGen, and to set more realistic goals. This procurement, implementation, and management of NextGen and the follow-up efforts are arguably the FAA’s biggest undertaking ever, and, as one might imagine, the functionality of the AMS can be viewed in tandem with the eventual functionality and success of these original NextGen systems, as well as the follow-on efforts recently announced by the DoT to take a new approach to ATC modernization. In short, the greatest test of the AMS may still be yet to come, and, despite difficulties with NextGen, the AMS will still be the best tool for this test.

Even though the implementation of NextGen has succeeded in many ways, it has also faced difficulties in updating the NAS’s vast system in a timely fashion. Every aspect of this process is a tremendous undertaking; the NextGen update is one of, if not the largest, aviation infrastructure updates in the history of the United States, and the new modernization efforts are slated to be even bigger. This progression makes it particularly critical for the AMS to be used to its absolute fullest. Cost and time efficiency can save years of delay and billions of dollars in procuring each of these complex and multifaceted systems that make up the modernization efforts, while delays can and have held back progress and reduced efficiency in spending.

1. The AMS Procurement, Implementation, and Management of NextGen Showcases the Ongoing Improvements to the AMS in the Face of Program Difficulties, and the Real-World Impact of Its Usage

Since efforts began in 2003 with the Vision 100—Century of Aviation Reauthorization Act, NextGen has been a proving ground of how efficient and successful the AMS can be for major system acquisitions when used correctly. As previously discussed in Part II, the AMS was first created in 1996 in response to the challenges faced by the FAA in updating the key systems of the NAS, including the ATC systems, which were a focus of NextGen and are a focus of the newly announced modernization efforts. In fact, as of the 2004 GAO report, the FAA was on the GAO’s “High-Risk List” due to the safety issues caused by the aging NAS system, and the associated difficulties in procuring and implementing the technology necessary to update and expand the NAS. Naturally, the AMS took some time to become fully functional, particularly because it was so different from the FAR and required an entire workforce to learn this new system. Once the AMS became fully functioning, progress was quickly realized in keeping with the goals of increased cost and time efficiency in FAA procurement. One sign of this success was in 2009, when the FAA was removed from the GAO High-Risk List. While NextGen itself has not panned out in full, it has laid a foundation for ongoing progress through the new ATC modernization efforts. This Note argues that this progress would not be possible without the implementation of the AMS to replace the FAR for FAA procurement.

To elaborate on the improvements driven by the AMS, it may be helpful to reflect on a 2016 report prepared by the FAA Acquisition Executive that showcases how the AMS has improved on pre-AMS procurement. One statistic is particularly telling: from 1994 to 2004, a period in which the AMS was 38% higher than predicted over the course of system procurement. From 2004 to 2014, when the AMS was starting to really evolve and hit its stride, cost growth was reduced down to 3.9%. It would be hard to imagine a clearer reflection of the AMS achieving its goal of promoting cost-effectiveness and efficiency in FAA procurement. Additionally, from 1994 to 2004, FAA major system procurement suffered from a 25% schedule delay, meaning that major system procurements were finishing 25% later than the target date. By comparison, during the 2004 to 2014 period with the AMS in full effect, schedule delay was reduced to 10.1%. Again, this figure demonstrates empirically that the AMS is increasing the time efficiency of FAA procurements. These statistics also show that, despite overall program delays to NextGen, the AMS has been steadily improving the acquisition process, and should not be blamed for NextGen delays.

2. The Wide Variety of Component Systems That Constitute NextGen Demonstrate the Value of the AMS’s Flexibility and Efficiency

In addition to these time and cost efficiency improvements demonstrating the success of the AMS from a statistical standpoint, it is also worth examining the value of the NextGen program as a whole, and its various individual component programs, because the AMS’s effectiveness is directly demonstrated by the ability to procure, implement, and maintain the wide variety of cutting edge technological systems that made NextGen so revolutionary in its efforts to update the NAS. The versatility and adaptability of the AMS will continue to be important in the recently announced new approach to modernization.

NextGen and the AMS are closely intertwined, particularly because the AMS is not only a vessel for procuring the wide array of purpose-built and innovative systems that made up NextGen, but the AMS will also be guiding the full-scale implementation of these systems across the country, as well as their maintenance throughout their life cycle. The AMS will continue to be used in this way as the tremendous new modernization efforts are undertaken, building on the progress and lessons of NextGen, while also nimbly improving the AMS itself. To give an idea of the scope of this accomplishment, this Note will briefly examine the varied technical categories of the main NextGen components, showcasing how the AMS has the flexibility to be applied in any, if not all, use cases that the FAA requires. Additionally, this Note will highlight the myriad benefits to the public and to industry partners, which are a direct result of NextGen and its effective usage of the AMS, benefits that will continue to be realized in the new modernization efforts. Finally, this Note will review the difficulties associated with NextGen, how these difficulties could be avoided in the future through more effective application of the AMS, and how the AMS will be used in the new efforts to complete what NextGen started: the modernization of the NAS.

i. The Varied Categories of NextGen Upgrades Showcase the Versatility of the AMS and the Ways That It Facilitates Collaboration

For the sake of clear discussion, this Note will divide the planned and realized upgrades into categories based on the types of mission-critical technology that they include, ranging from communication to surveillance. The first category that NextGen aims to upgrade is communications, specifically using digital communication tools between pilots and air traffic controllers. Here, the AMS can empower the FAA to collaborate with manufacturers that will put this new technology in their aircrafts. The next category is navigation. A particular goal here is to increase the resiliency of the “Performance Based Navigation” (PBN) system. From an acquisition perspective, this category again relies in part on working closely with industry partners because it will best serve aircrafts that are properly equipped to use the FAA’s Distance Measuring Equipment (DME) sites. Interfacing with industry partners is made easier with the flexibility of the AMS, which allows for more informed acquisition management. The navigation category is still in the early stages of full implementation, with 19 out of 126 DME sites built. The life-cycle management strategy of the AMS supports long-term programs such as NextGen and the recently announced new modernization efforts.

Another category to be upgraded is surveillance. One major aspect of this improvement requires the retrofitting of existing aircrafts to receive real-time weather, traffic, and flight information. This new procurement is still in its research stage, and data is being collected through an industry partnership with American Airlines and Aviation Communications & Surveillance Systems. The AMS encourages collaboration with the aerospace industry, allowing the FAA to more easily accomplish projects that span generations, and even eras of technology, by working alongside the constantly evolving aerospace industry.

The next category focuses on automation, and highlights how the AMS can be useful in the procurement and development of complex software-based systems. Much of the automation software seeks to lessen the burden on air traffic controllers when managing traffic. A unique aspect of this component is that it often runs custom software, purposely built for the FAA on commercial hardware available to the public. This use of commercial goods is explicitly encouraged by the policy and guidance of the AMS, reducing the burden associated with “reinventing the wheel.” The projects in this category have varying timelines, with some reaching the end of their life cycle and being decommissioned via AMS processes, others reaching completion in 2024, and others being planned to continue into 2031 for full implementation, showcasing the long-term viability of the AMS.

The final two categories—systems and weather—work together in some capacities. One category focuses on System Wide Information Management (SWIM), which is a secure data-sharing platform allowing for real-time data to be shared between international partners, airline partners, research and development partners, and key industry partners. This system is constantly being updated with new cybersecurity technology, and the AMS is a great tool for these cybersecurity procurements due to its flexibility and capacity to quickly adapt to the emerging technology in this sphere. The final category is weather. Weather problems are the number one cause of delays in the NAS, and full implementation of these new weather systems will be achieved at some key sites by 2025, with complete coverage planned for the future. These systems will likely continue to be a part of the new ATC modernization efforts. The NextGen program demonstrates how the AMS can be used to combine new systems with existing ones, as the new weather technology will be set up to disseminate information via SWIM by the end of 2025.

The intricacies of each of these system procurements as part of NextGen could be a Note of its own, but, in this brief overview, it is clear to see how the efficiency, flexibility, and life-cycle management approach of the AMS is integral to the procurement of such varied technology over such a long period of time. With more of the nuts and bolts laid out, this Note will review some of the realized and predicted benefits to the U.S. public and industry as a result of NextGen and newer efforts, summarize the areas where NextGen struggled, and explain why the AMS is still the best procurement tool for the future of the FAA despite these difficulties.

ii. How the Benefits of NextGen Are Calculated, and How They Reflect on the AMS

Starting in 2010, the FAA began measuring the benefits of implemented NextGen systems. These measured benefits helped show the direct impact of the AMS that was used to procure and implement these systems and that is still in use to maintain and adapt these systems as the NAS environment evolves and demand increases, particularly with the newly slated ATC improvements.

The FAA does not measure these benefits in a bubble. Starting in 2016, the FAA further strengthened partnerships with the aviation industry by creating the Joint Analysis Team (JAT), an FAA-Industry partnership that provides valuable external perspective with which to evaluate NextGen and other improvements. The JAT was created as a part of the NextGen Advisory Committee (NAC). The NAC is a committee comprised of FAA members and industry partners that advise on the evolution of the NAS, and allow the FAA to stay on the cutting edge of emerging technology and capabilities in the aviation industry. This collaboration is fostered by the AMS and its focus on working alongside industry.

This partnership is particularly crucial in commercial aviation because, although the FAA regulates the airports and controls the operations of the entire NAS, industry partners produce and fly the planes, and often help supply the FAA with data, technology, and innovative strategies. Because the government and industry are uniquely and necessarily intertwined in aviation, the AMS is once again the clearly optimal system for the job of managing the procurement, implementation, and operations of each FAA system. The AMS’s flexibility and discretion in decision-making give the government the leverage and capacity that it needs to manage the symbiotic relationship with the aviation industry in a way that the FAR would prohibit due to laws such as CICA. These industry relations are once again clearly present in the evaluation of the NextGen system and add credibility to the benefits of NextGen recorded by the FAA. These relationships will continue to be valuable as the new modernization efforts get underway, assisting the FAA in benchmarking effectively and setting reasonable goals based on industry capabilities.

As to the benefits themselves, the FAA measures them by comparing the various systems before and after NextGen implementation and then adjusting for the demand for commercial aviation at any given time. Using this methodology, which is approved by the JAT, the FAA is then able to calculate cumulative benefits over time. These benefits will increase exponentially over time, all under the purview of the AMS, as new NextGen components are procured, implemented, and managed throughout their life cycle, adding to the benefits of previous components. These efforts will compound further with the new modernization efforts that are taking the air traffic control systems into the future.

Now to the numbers themselves: from 2010 to 2024, implemented capabilities of NextGen functions alone generated an estimated $12.4 billion in benefits to the public and industry. These benefits are divided into four main categories: (1) safety benefits, (2) fuel savings, (3) aircraft operating cost savings, and (4) passenger travel time savings. These categories cover a mix of industry and public interests, with the greatest benefits coming from passenger travel time savings, approximately $7 billion. This is a direct data point to show what the AMS has already accomplished via the goals of time and cost efficiency.

But the success does not stop there. Based on projections of cumulative benefit into the year 2040, the outcomes are even better. With only the already implemented functions of NextGen so far, the cumulative benefits are projected to reach $36 billion by 2040, and with the highest projection of NextGen system success and implementation, this number balloons to a projected cumulative total of $76 billion dollars in benefits by 2040. These numbers, both achieved and projected, speak volumes of the trust that the FAA has placed in the AMS and its continued evolution and success, and cement the fact that the AMS is the best system to promote time and cost efficiency, as well as life-cycle management strategies, that the FAA needs to succeed going forward with modernization efforts.

These benefits and successes are a testament to the potential of the AMS as a procurement system, but this potential was not fully realized with the struggles of NextGen. As the FAA moves forward with the new ATC modernization efforts, it will be imperative that the FAA learn from previous mistakes, including improper application of the AMS, as the AMS has the potential to maximize the efficiency and cost-effectiveness of procuring these new modern ATC systems.

iii. The FAA Must Learn from the Mistakes of NextGen and Adapt the AMS to Achieve Success in the New Modernization Efforts

The FAA achieved great things with NextGen and realized many benefits for both industry and the U.S. public, but the FAA did not succeed in achieving their plans in full. Some reasons for these shortcomings, such as the COVID-19 pandemic, were out of its control, but many were due to ineffective management and unrealistic decision-making. From these mistakes, two lessons presented by the DoT Office of Inspector General (OIG) stand out in particular as relevant to the effective usage of the AMS: (1) “developing and implementing realistic long-term plans and assessing risks” and (2) “managing and overseeing major acquisitions and funding.”

During the acquisition of NextGen, the FAA sometimes overestimated the timeline of implementation and underestimated the risks, leading to underdelivering on some key programs. The DoT OIG suggested these issues may have stemmed from unclear requirements at the outset, as well as reliance on individually managed programs. Greater reliance on the AMS decision-making structure, including the JRC and team management-driven approach, could have reduced these issues.

Another area for improvement relates to the management of major acquisitions. Here, the FAA utilized large individual contracts where future requirements had not yet been determined. This grouping requires less work up front, but, in the future, the FAA should utilize the AMS more effectively by awarding multiple smaller contracts, allowing for increased competition (by creating more chances to compete for discrete areas of the project) and more comprehensive management.

As the FAA moves forward with the new ATC modernization efforts, it will be crucial to learn from the mistakes made in the implementation of NextGen, particularly in regard to the effective usage of the AMS. These modernization efforts are varied and largely rely on the implementation of new technologies and systems to update current outdated ATC system. The versatility and efficiency of the AMS will be the ideal tool to meet these varied needs, but it must be used effectively. The AMS acquisition management strategy must first be deployed to accurately assess timelines and cost estimates, and this must be done with the buy-in of industry, operators, procurement officials, and FAA executives. This type of collaboration is an area where the AMS can shine. Once requirements have been set and plans have been made, the life-cycle acquisition management of the AMS will be crucial to effectively monitor existing contracts, set follow-on contracts, and assure that the connection between those procuring the technology, those implementing the technology, and those using the technology is maintained. If these lessons from the NextGen procurement are followed, the AMS will be able to facilitate these crucial modernization efforts.

IV. Conclusion

Even though the AMS has proven to be effective in achieving the FAA’s goals, it does have potential for improvements. With NextGen procurement and management, the AMS faced some of the common issues in government procurement as an industry, such as cost overrun and project delays. These problems pale in comparison to the actual technical quality of the results being delivered, and the FAA is consistent in delivering on its performance goals, thus preserving the safety and effectiveness of the NAS. Furthermore, when issues do arise in NextGen procurement, the AMS is able to quickly adapt and evolve, changing its policies in as little as three to six months, where the FAR often takes at least two years. This shorter timeline reinforces that, at its best, the AMS has been a key component in revolutionizing the NAS through NextGen, and, when it does stumble, no comparable system is more capable of correcting its own course and getting back on the path to efficient and effective procurement and life-cycle management. This next test of the ATC modernization project will be a new arena for AMS growth, and, if the FAA learns from the mistakes made during NextGen, the AMS will continue to thrive and evolve into the system that the FAA needs now and for the future of U.S. aviation.

---

Endnotes