Updates to the Origin-Destination Survey of Airline Passengers

Published date19 January 2021
Citation86 FR 5052
Record Number2020-29229
SectionProposed rules
CourtThe Secretary Of Transportation Office
Federal Register, Volume 86 Issue 11 (Tuesday, January 19, 2021)
[Federal Register Volume 86, Number 11 (Tuesday, January 19, 2021)]
                [Proposed Rules]
                [Pages 5052-5063]
                From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
                [FR Doc No: 2020-29229]
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                DEPARTMENT OF TRANSPORTATION
                Office of the Secretary of Transportation
                14 CFR Parts 241 and 298
                [Docket No. DOT-OST-2018-0132]
                RIN 2105-AE45
                Updates to the Origin--Destination Survey of Airline Passengers
                AGENCY: Office of the Secretary of Transportation (OST), U.S.
                Department of Transportation (DOT).
                ACTION: Notice of proposed rulemaking (NPRM).
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                SUMMARY: The Department is proposing to update the method of collecting
                and processing aviation traffic data in the Origin-Destination Survey
                of Airline Passenger Traffic (O&D Survey), as well as to expand the
                number of reporting air carriers, the sample size collected, and the
                scope of the data reported. These changes would align the current O&D
                Survey with modern industry business and accounting practices, enable
                cost savings, reduce burden through automation, and provide enhanced
                utility for users of the data. In addition, DOT is proposing to change
                the timing of the release of the Form 41, Schedule T-100(f) ``Foreign
                Air Carrier Traffic Data by Nonstop Segment and On-flight Market'' from
                a 6-month delay to a 3-month delay to match that of Form 41, Schedule
                T-100 ``Air Carrier Traffic and Capacity Data by Non-Stop Segment and
                On-Flight Market.''
                DATES: Submit comments on or before March 19, 2021, 11:59 p.m. Eastern
                Time. The Department will consider late comments to the extent
                practicable.
                ADDRESSES: To ensure that you do not duplicate your docket submissions,
                please submit all comments by only one of the following means:
                 Federal eRulemaking Portal: Go to http://www.regulations.gov and follow the online instructions for submitting
                comments.
                 Mail: Docket Management Facility, U.S. Department of
                Transportation, 1200 New Jersey Ave. SE, West Building, Ground Floor,
                Room W12-140, Washington, DC 20590-0001.
                 Hand Delivery: U.S. Department of Transportation, 1200 New
                Jersey Ave. SE, West Building, Ground Floor, Room W12-140, Washington,
                DC 20590-0001, between 9:00 a.m. and 5:00 p.m. ET, Monday through
                Friday, except Federal holidays.
                 Instructions: At the beginning of your comments, include the agency
                name, docket name, and docket number (DOT-OST-2018-0132) or Regulation
                Identifier Number (RIN) for this rulemaking (2105-AE45). All comments
                received will be posted without change to http://www.regulations.gov,
                including any personal information provided. Physical access to the
                Docket is available at the Hand Delivery address noted above.
                 Electronic Access and Filing: You can view this document by going
                to the Federal eRulemaking Portal: http://www.regulations.gov and
                search for docket DOT-OST-2018-0132. The website is available 24 hours
                each day, 365 days each year. Electronic submission and retrieval help
                and guidelines are available under the help section of the website. An
                electronic copy of this document is available for download from the
                Office of the Federal Register's home page at: http://www.archives.gov/federal-register and the U.S. Government Publishing Office's web page
                at: https://www.gpo.gov/fdsys/ fdsys/.
                FOR FURTHER INFORMATION CONTACT: Mark Raggio, Office of Aviation
                Analysis, 1200 New Jersey Ave. SE, Room W86-470, Washington, DC 20590-
                0001, 202-366-1271 (phone) or [email protected] (email).
                SUPPLEMENTARY INFORMATION:
                I. Background
                A. Legal Authority
                 Section 429(b)(1) of Title 49, U.S.C., requires the Department to
                collect and disseminate information on the origin and destination of
                airline passengers including, at a minimum, information on: (1) The
                origin and destination of passengers in interstate air transportation,
                and (2) the number of passengers traveling by air between any two
                points in interstate air transportation. In addition, 49 U.S.C.
                40101(a)(7) states that the Secretary shall respond to the needs of the
                public, including the airline industry, all levels of government, and
                airports, by disseminating information to foster a national air
                transportation system capable of meeting the present and future needs
                of U.S. commerce. In fulfillment of these responsibilities, DOT
                collects data submitted under:
                 14 CFR part 217: Reporting Traffic Statistics by Foreign
                Air Carriers in Civilian Scheduled, Charter, and Nonscheduled Services,
                whereby foreign air carriers that are authorized by DOT to provide
                scheduled passenger services to or from the U.S. must file Form 41
                Schedule T-100(f), accumulated in accordance with the data elements
                prescribed in Sec. 217.5.
                 14 CFR part 241: Uniform System of Accounts and Reports
                for Large Certificated Air Carriers, under which all large certificated
                air carriers must report their traffic movements by filing Form 41
                Schedule T-100, Financials Information, and O&D fare information.
                 14 CFR part 298: Exemptions for Air Taxi and Commuter Air
                Carriers, whereby air taxi operators and commuter air carriers, which
                are provided certain exemptions from some of the economic regulatory
                provisions of Subtitle VII of Title 49 of the United States Code, are
                required to submit simplified Financials and T-100 traffic.
                 In this rulemaking, the Department proposes to update its method of
                collecting and processing O&D fare information under part 241 to: (1)
                Allow full automation of the reporting of the O&D Survey by aligning it
                with current airline passenger accounting practices; and (2) enhance
                the accuracy and usefulness of DOT's collection of aviation traffic
                data.
                B. Background on the O&D Survey
                 Currently, the O&D Survey, as outlined in 14 CFR part 241, Sec. 19-
                7, collects airline tickets from select air carriers,\1\ ``O&D Survey
                Reporting Carriers,'' each quarter. The O&D Survey Reporting Carriers
                combine the information from tickets with the same itinerary and price
                into a summary record reported every 3 months. Under 49 U.S.C.
                329(b)(1), the Department is obligated to collect and disseminate this
                information. There are many private and public stakeholders that depend
                on this data to make decisions on aviation business and policy. For
                example, this data is used by the industry to plan air services,
                develop commercial aviation
                [[Page 5053]]
                infrastructure, measure the economic impact of passenger flows, and
                create business plans for start-up airlines. The O&D Survey is also a
                primary source of information used to quantify and evaluate the
                effectiveness of Federal aviation policy and programs as well as to
                develop and implement new policies and infrastructure initiatives.
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                 \1\ 49 U.S.C. 40102(a)(2).
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                 When the current rules for collection of the O&D Survey were
                established in the 1960s, the O&D Survey provided the best reasonably
                obtainable measure of passenger aviation activity. The mainframe
                technologies of the era dictated many aspects of the O&D survey
                business process and the elements selected for collection. A key driver
                of the process was that data storage was expensive in that era which
                resulted in a minimum of data elements being included. This meant more
                robust descriptive data, such as the time of arrival and departure,
                were not included in the collection. Because mainframes were
                centralized computing resources, the O&D Survey process was designed to
                route paper tickets to a centralized facility for processing and
                loading into the systems. In the intervening years, changes in airline
                business models and accounting practices enabled by technology
                improvements were not reflected in DOT's collection methodology,
                leading to a misalignment between the rules for reporting the
                information and current accounting practices that generally requires
                human intervention to reconcile differences and prevents O&D Survey
                Reporting Carriers from fully automating the system of data collection.
                The primary design issue that prevents current improvements is the
                regulatory requirement that the operating carrier that first touches
                the ticket is the carrier that has responsibility to report the ticket,
                known as the ``first reporting carrier rule.'' In the 1960s, this rule
                was selected because the most efficient process was physically to
                detach the ticket coupons as they were flown for each flight and send
                all the coupons to the centralized processing facility to be matched
                and combined with the relevant revenue information. Because the carrier
                that issued the ticket, which had all the necessary information on
                hand, often did not first touch the ticket, the carrier with the least
                amount of information was by rule responsible for reporting the ticket.
                Modern and decentralized E-ticket systems eliminate the need for a
                physical coupon matching process and enables more efficient reporting
                rules and access to more relevant data.
                 DOT has worked with representatives of the aviation industry trade
                association Airlines for America (A4A) to determine the best way to
                improve the methodology, collection, and utility of the O&D Survey. DOT
                is proposing this rule to reform and simplify the O&D Survey,
                principally by reorienting the reporting requirements so that air
                carriers report primarily information for tickets that they issue.
                II. The Need To Modernize Current Data Collection Requirements
                 The data collected in the O&D Survey provides DOT with the
                information to help foster an air transportation system capable of
                meeting the present and future needs of commerce in the United States.
                However, the current O&D Survey methodology was designed based on
                accounting processes long abandoned by airlines, including manual
                accounting systems that often had handwritten records. As a result, the
                Survey's data collection methodology does not reflect today's
                decentralized and integrated industry-wide practices and technologies,
                and, in some cases, it is not capable of accurately documenting
                consumer behavior. For example, in today's environment, it is far more
                efficient for the carrier that issues the ticket to be responsible for
                reporting the ticket because it is the issuing carrier that has all the
                information about the ticket. Current process requires the operating
                carrier that flies the first coupon of the ticket to report and this is
                often not the issuing carrier. Because current reporting does not
                contain information about the length of stay at each intermediate point
                in a ticket, the system must impute the intended destination of round
                trip tickets. With the advent of large-scale connecting services, this
                has made the determination of intended destination less accurate.
                Though the Survey remains a unique and foundational pillar of industry
                economic analysis, its limitations create high levels of uncertainty in
                certain situations, such as identifying the true origin and destination
                of some passengers; the month of travel; and the portion of the total
                amount paid that is the revenue retained by the air carrier, as opposed
                to taxes and fees remitted to other government entities. By aligning
                the O&D Survey with current industry technology and integrated business
                process, this proposal would vastly simplify the reporting of
                appropriate data elements and increase the utility of the Survey to its
                users.
                A. Changes in Airline and Consumer Behavior Since 1978
                 The way the airline industry markets and delivers air
                transportation services to the public changed significantly following
                the Airline Deregulation Act of 1978.\2\ The 1978 Act enabled airlines
                to set their own fares, flight frequencies, and route structure. The
                current rules for the collection of ticket information were
                specifically designed to measure the relatively static air travel
                industry of the 1960s, when fares and flight frequencies were set by
                the Federal Civil Aeronautics Board and tended to be from a single
                point to a single point. The current O&D Survey data collection rules
                do not reflect the increasingly dynamic and complex business practices
                that have emerged since deregulation, including the development of hub-
                and-spoke systems, frequent flier programs, revenue management systems,
                internet distribution of tickets, and other industry-transforming
                innovations. For example, under the post-deregulation hub-and-spoke
                model developed by legacy air carriers, it became increasingly common
                to fly initially to a single, large ``hub airport'' where some
                passengers would change planes to complete their journey, while others
                remained on the same plane during intervening stop(s), known as a
                ``direct'' passenger flight. In the case of the ``direct'' passenger,
                the carriers would use a single ticket that identifies the origin and
                ultimate destination, but not the intermediate stop(s). Furthermore, in
                combination with these changes, new airline loyalty programs altered
                passenger ticket purchasing behavior; travelers in these programs were
                increasingly incentivized to take longer, indirect routes, often
                through an airline's large hub airport, that would allow them to
                accumulate more mileage-based loyalty points, exacerbating reporting
                issues, such as identification of the intended destination of travel,
                with the O&D Survey. The industry innovations forged after deregulation
                changed the fundamentals of airline competition, but the process used
                and the data DOT collects did not modernize concomitant with these
                changes.
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                 \2\ Public Law 95-504.
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                B. Reevaluation of O&D Survey Burden and Data Quality
                 Considering these developments, DOT initiated a retrospective
                analysis of its aviation traffic reporting rules. The Department
                recognizes that there are concerns with the quality of the current O&D
                Survey, and that it is expensive
                [[Page 5054]]
                and burdensome to collect, validate, and use. Collaborative discussion
                with A4A representatives revealed that there is a substantial hidden
                cost of compliance in reporting aviation statistics due to the
                difficulty in identifying and investigating problems that are often
                only revealed during post-submission quality control processing. The
                carriers are also often in the position of having to interpret how to
                stay in compliance with outdated rules that require them to deviate
                from their current accounting practices. For these reasons, the
                Department believes that the O&D Survey no longer meets the guidance
                outlined in OMB Circular A-130 \3\ or the data collection standards of
                the Information Quality Act.\4\ In addition, DOT identified instances
                in the reporting regulations that contribute to deficiencies in data
                quality. These deficiencies are often not observable until after the
                data from all the carrier submissions is combined during post-
                processing analysis. Moreover, ambiguity in the current regulation may
                lead O&D Survey Reporting Carriers to interpret reporting instructions
                differently, contributing to the degradation of the O&D Survey data
                quality and increasing the air carrier's reporting burden as they must
                review the suspected data and resubmit once the problem is found.
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                 \3\ Circular A-130 requires DOT to take affirmative steps to
                ensure data quality objectivity and utility of Federal statistics
                before disseminating them and notes that public and private
                resources are allocated inefficiently when uncertainty is introduced
                due to inexact or incorrect data.
                 \4\ Public Law 106-554 Section 515 charges Federal agencies with
                a responsibility to produce the best reasonably obtainable
                scientific and economic information available to measure the impact
                of their regulatory responsibilities.
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                 Furthermore, DOT determined that the collection and dissemination
                of the O&D Survey remains justified under the regulatory philosophy
                stated in Executive Order (E.O.) 12866, sec. 1(a) which is that ``the
                Federal Government should . . . promulgate regulations as required . .
                .'' It was also determined that, given its role and statutory duties,
                DOT is best positioned to collect uniform, accurate, and complete data
                on the Nation's civil aeronautics sector as well as ensure widespread
                dissemination of the collected data. Diverse public and private
                stakeholders, including air carriers, investors, and aircraft
                manufacturers, rely on this data to inform business decisions,
                infrastructure improvements, and aviation regulations or public
                policies. For example, the airline industry continues to use the O&D
                Survey to plan air services, develop commercial aviation
                infrastructure, measure the economic impact of passenger flows, and
                create business plans for start-up airlines. The data is also a primary
                source of information used to measure and evaluate the effectiveness of
                Federal aviation policy and programs, including by: (1) Improving
                international air services by seeking market liberalization, (2)
                ensuring the benefits of a deregulated, competitive domestic airline
                industry, and (3) developing policies to improve air service and access
                to the national air transportation system for small and rural
                communities. Furthermore, the Federal Aviation Administration (FAA)
                requires airports to use accurate aviation data for qualifying,
                planning, allocating, and monitoring of Airport Improvement Program
                (AIP) funds and to justify the need for Passenger Facility Charges
                (PFCs). The outdated and cumbersome O&D Survey methodologies impose
                excessive burdens on O&D Survey Reporting Carriers and diminish the
                data's utility to its users due to quality, objectivity, and
                completeness issues, and therefore requires modernization. In addition,
                ensuring universal participation across air carriers and collection of
                the best reasonably obtainable measurements of economic activity in the
                aviation sector requires updating the O&D Survey methodologies.
                C. Meeting Reporting and Data Quality Demands
                 This proposed rule would modernize the O&D Survey to reflect
                current airline passenger behavior and revenue accounting practices,
                which allow air carriers to track the sale and the usage of every
                ticket sold, including through partner carriers. In doing so, the
                proposed rule would ensure that the O&D Survey meets the requirements
                and objectives of the Information Quality Act,\5\ E.O. 12866, E.O.
                13771, and OMB Implementation Guidance for Title V of the E-Government
                Act, Confidential Information Protection and Statistical Efficiency Act
                of 2002.\6\
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                 \5\ Public Law 106-554, sec. 515.
                 \6\ 72 FR 33362 (June 15, 2007).
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                III. Development of the Proposed Rule
                A. Prior Related Rulemakings
                 The Department initiated a retrospective analysis of its passenger
                traffic statistics on July 15, 1998, when DOT published an advance
                notice of proposed rulemaking (ANPRM),\7\ requesting comment on a
                variety of issues related to aviation economic data collection.
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                 \7\ 63 FR 28128.
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                 On February 17, 2005, DOT published a notice of proposed rulemaking
                (NPRM) \8\ as part of DOT's effort to revise the rules governing the
                nature, scope, source, and means for collecting and processing aviation
                traffic data as well as modernize the collection, processing, and
                dissemination of this data. While there was considerable support for
                these changes among stakeholders, the comments from the airlines
                indicated that the burdens of reporting the data would be unacceptably
                high relative to the current collection. The 2005 proposal to collect
                all relevant data on the ticket was overly broad and too costly to
                implement. The Department withdrew the proposal on June 1, 2011,
                stating that the proposed approach did not adequately address some
                issues, including measures that could both enhance the utility,
                integrity, and accuracy of the data and reduce the cost of reporting.
                The current proposal, by comparison, is more narrowly tailored to
                address specific well-known quality problems that have been identified
                by both producers and users of the data over a long period of time,
                maintains the same data structure of the current reporting allowing for
                reuse of as much of the existing infrastructure as possible, removes
                elements that are no longer required, adds new useful elements, and
                improves reporting rules.
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                 \8\ 70 FR 8140.
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                B. Summary of Modifications Suggested by the Industry
                 This proposed rule renews DOT's effort to revise its aviation
                statistical reporting process. In an October 5, 2015, letter to DOT,
                A4A recommended changes to the reporting regulation that would increase
                the utility and accuracy of the data while simplifying reporting.
                Representatives of A4A notified DOT that their members favored updating
                the rule governing the collection of the O&D Survey under prescribed
                circumstances. A4A identified changes to reporting that would increase
                the utility of the data and, at the same time, simplify reporting.
                These proposed changes were reflective of numerous interactions related
                to the data collection between government and industry over many years.
                The series of ideas that stemmed from this collaboration are listed
                below.
                Methodology Changes
                 (1) Change the responsibility of reporting tickets from the First
                Reporting Carrier Rule to the Issuing Carrier; \9\
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                 \9\ The current regulation places the reporting responsibility
                on the first O&D Survey Reporting Carrier in the sequence of travel
                for a ticket. The proposed regulation will place the reporting
                responsibility on the carrier that issued the ticket. It is the
                carrier that issues the ticket that will have the most information
                about the ticket.
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                [[Page 5055]]
                 (2) Classify all Certificated air carriers and commuter air
                carriers holding out scheduled passenger service as O&D Survey
                Reporting Carriers by removing the exemptions from reporting given to
                U.S.-based air carriers and commuter air carriers with a business model
                that limits them to flying aircraft with fewer than 60 seats;
                 (3) Refrain from requiring foreign air carriers to report O&D
                Survey data, other than foreign air carriers granted anti-trust
                immunity under 49 U.S.C. 41308 and 41309; instead, the responsibility
                to report tickets issued by a foreign air carrier (that does not submit
                data under 49 U.S.C. 41308 and 41309) should remain with the O&D Survey
                Reporting Carrier that appears first in the travel sequence of the
                ticket;
                 (4) Change the period of reporting from quarterly to monthly;
                 (5) Increase the sample size to 40% of airline tickets so that the
                sample size is statistically valid for measuring travel to small and
                rural communities; and
                 (6) Shorten time lag for the release of T-100(f) data from the
                current 6 months to 3 months, consistent with the release of T-100
                Domestic data. Historically this time lag has existed because of
                technological and business practice limitations.
                New Data Items To Be Collected
                 (1) ``Dwell Time,'' an indication of the hours that the passenger
                spends at an airport between their arriving and departure flights;
                 (2) ``Via Airport,'' an entry for airlines to report hidden
                airports or ``via'' airports where a passenger lands, but does not
                necessarily deplane;
                 (3) ``Total Tax,'' a value of the total taxes and government-
                imposed fees collected for each ticket, to distinguish this value from
                the Total Amount of the fare collected;
                 (4) ``Travel Year and Month,'' to include a field detailing the
                year and month the passenger travels for each segment of travel;
                 (5) ``Exchanged Ticket Indicator,'' alerting data users that a
                reported fare may not comport with the reported itinerary; and
                 (6) ``Reporting Record Identifier,'' facilitating easier record
                identification by the O&D Survey Reporting Carrier when correcting
                tickets reported with errors.
                Data Items the Department Proposed No Longer Be Collected
                 (1) The fare class the passenger uses on each of the flights;
                 (2) The cabin class the passenger uses on each of the flights; and
                 (3) The date of ticket purchase.
                 In November 2015, the Airline Tariff Publishing Company (ATPCO),
                the leading distributor of airline fares and airline fare information
                for the industry notified DOT that it had the ability to report the
                proposed restructured O&D Survey as envisioned by A4A and DOT and that
                ATPCO could offer that capability as a third-party service to airlines.
                C. Goals and Objectives of This Regulatory Action
                 The Department established the following objectives for this
                rulemaking: (1) Reduce the long-term reporting burden on the O&D Survey
                Reporting Carriers; (2) make the O&D Survey more relevant and useful to
                airlines, aviation policy makers, researchers, and stakeholders; (3)
                obtain more accurate ticket data from a broader group of air carriers
                and markets; (4) reduce the time it takes to disseminate the O&D Survey
                and the T-100(f); and (5) increase the statistical correlation between
                the O&D Survey and the T-100/T100(f) for data validation purposes.
                Taken together, this proposed rule would alleviate unnecessary
                regulatory burdens placed on the American people and businesses.
                IV. Proposed Changes to the Collection of Data
                 The Department proposes the following modifications to its
                collection of scheduled passenger aviation data:
                D. Altering the Reporting Framework
                 The general process for reporting O&D data is to collect the ticket
                information once there is an indication that the ticket has been flown,
                combine all the ticket coupons to determine all the points flown and
                the sequence of travel on the ticket, and integrate the flown
                information with revenue information related to the price the consumer
                paid for the ticket.
                1. Selection of Tickets to Report
                a. Making the Ticket the Basic Unit of Reporting
                 This proposed rule would give O&D Survey Reporting Carriers the
                responsibility for reporting a ticket when it is the Issuing Carrier
                for that ticket, relieving air carriers of the responsibility to report
                any ticket issued by another O&D Survey Reporting Carrier. Under the
                proposed rule, Issuing Carriers would know when a coupon from one of
                their tickets is used for transportation by any other air carrier on
                the ticket, triggering a Reporting Event. Moving the responsibility to
                report to the Issuing Carrier would simplify the reporting process by
                establishing one identifiable air carrier that has all the information
                on a ticket and is responsible for reporting the ticket. These types of
                tickets will account for the majority of reported tickets. Tickets
                issued by an O&D Survey Reporting Carrier would be referred to as
                ``Category One Tickets.''
                 In addition to Category One tickets, tickets may be issued by air
                carriers who would not fall under the new definition of O&D Survey
                Reporting Carriers; however, those tickets may still present
                information that should be recorded. The proposed rule would continue
                to require each O&D Survey Reporting Carrier to report these
                encountered tickets issued by Non-O&D Survey Reporting Carriers. These
                tickets would be referred to as ``Category Two Tickets.'' Category Two
                Tickets would require a process for recognizing a Reporting Event that
                is different than that for Category One Tickets. The proposed Category
                Two reporting process would be like the existing process, but the
                expected volume of Category Two Tickets will be significantly less
                under this proposed rule due to the expansion of the pool of O&D Survey
                Reporting Carriers and the Category One reporting rule, which will have
                primacy.\10\
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                 \10\ For evaluating Category 2 tickets, foreign air carriers
                that have been granted Antitrust Immunity under 49 U.S.C. 41308 and
                41309 will be responsible for reporting Eligible Tickets they issue
                and U.S. air carriers will no longer have to report these.
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                 The Department recognizes that it could eliminate Category Two
                Tickets, and therefore the associated burden of reporting these
                tickets, by requiring all foreign air carriers providing scheduled
                service to the United States to submit O&D Survey data. The Department,
                therefore, seeks comment on whether to require all foreign air carriers
                providing scheduled service to the United States submit O&D Survey
                data.
                b. Increasing Sample Size to 40 Percent
                 This proposed rule would increase the number of passenger tickets
                air carriers are required to report, which would create a statistically
                valid sample for meaningful analysis of smaller markets that is not
                available under the current O&D Data collection. The current sample
                size of 10 percent is only sufficient for analyzing large markets and
                the national air transportation
                [[Page 5056]]
                system at a broad level. Studies indicate that a 40 percent sample is
                sufficient to allow proper evaluation of small aviation markets, and so
                the Department is proposing to increase the number of passenger tickets
                are required to report to 40 percent.\11\ The ability to measure small
                markets is important to air carriers and to policy makers in order to
                monitor the effectiveness of Federal dollars spent in programs such as
                the Essential Air Service (EAS) and the Small Community Air Service
                Development Program (SCASDP), that are designed to ensure that small
                and rural communities have access to the national air transportation
                system. The 40 percent sample, in combination with expanding the
                universe of O&D Survey Reporting Carriers, would substantially improve
                the ability to measure smaller markets accurately.
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                 \11\ Statistical analyses by Michael Wittman (Michael D.
                Wittman, A Note on the Use of U.S. DB1B Passenger Ticket Data for
                Estimating Airfares in Thin Airline Markets or Small Airports,
                Massachusetts Institute of Technology), and Eric Amel (Eric Amel,
                Report on the Results of Different Sampling Rates on the Reliability
                of the US DOT O&D Survey, Compass Lexecon, May 18, 2015) are
                available in the Docket.
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                c. Providing an Unbiased Sample Selection
                 The proposed rule would designate the final, right-most digit of
                the standard ticket document number as the basis for the new, random
                sample size. Analyses by DOT suggest that the final digit of a ticket
                number does not pertain directly to any particular type of passenger or
                journey, and every digit (0-9) has an equal probability of appearing.
                This method ensures that the random sampling of 40 percent of Eligible
                Tickets for the O&D Survey would be truly unbiased and random,
                protecting the validity and integrity of the data.
                 Any O&D Survey Reporting Carrier that does not assign ticket
                numbers to passenger journeys or does not assign ticket numbers such
                that the final, right-most digit is not randomly assigned would be
                required to develop an alternative method of creating a valid 40
                percent sample. Those O&D Survey Reporting Carriers would need to
                submit their alternative sample methods to DOT for approval within 90
                days of the date that the O&D Survey Reporting Carrier recognizes that
                it must make use of the alternative sample selection method to comply
                with the proposed reporting regulation for determining an Eligible
                Ticket.
                2. Removing the Requirement for Summarization
                 Under the proposed rule, O&D Survey Reporting Carriers would report
                individual tickets as separate records, rather than aggregating tickets
                with identical characteristics into a single reporting record.
                Currently, the number of tickets in each grouping is tracked and
                reported as a passenger count. This process was initially instituted
                because the cost of data transmission and storage exceeded the cost of
                processing the records into summarized records. However, due to
                significant advances in data transmission and storage technology, any
                such savings are now minimal. The process of grouping and summarizing
                similar tickets into one summary reporting record creates an
                additional, unnecessary step for the O&D Survey Reporting Carriers, and
                is inconsistent with modern revenue accounting practices. Combining the
                tickets also increased the difficulty of correcting the occasional,
                inevitable mistakes that arise in reporting to the O&D Survey because
                the individual records that cause the problem are not identifiable in
                the summary record that is provided.
                E. Modification to O&D Survey Reporting Carriers
                 The proposed rule would simplify the identification of the air
                carriers responsible for reporting a ticket, correcting the current
                onerous and burdensome process. It would also all but eliminate the
                need for an air carrier that may not have information on a ticket in
                its internal systems to obtain the information from other sources
                outside its normal business process.
                1. U.S. Air Carriers \12\ as O&D Survey Reporting Carriers
                ---------------------------------------------------------------------------
                 \12\ 49 U.S.C. 40102(a)(2).
                ---------------------------------------------------------------------------
                 The proposed rule would require that all U.S. air carriers that
                hold either a certificate of public convenience and necessity for
                scheduled passenger air transportation pursuant to 49 U.S.C. 41102 or
                that hold a Commuter Air Carrier Authorization pursuant to 14 CFR part
                298 and that hold out a schedule and issue tickets for scheduled
                passenger air transportation be considered O&D Survey Reporting
                Carriers for the O&D Survey. This proposed rule would require all O&D
                Survey Reporting Carrier to submit O&D Survey data to capture travel in
                markets served by all types of air carriers. However, by making the
                reporting regulation compatible with industry accounting structures,
                DOT expects this reporting would add minimal additional burden to
                affected air carriers. Carriers would only report tickets that satisfy
                the reporting criteria. In most cases, air carriers operating as
                contract lift providers (i.e., code-share branded regional partners)
                would not have to report tickets. If necessary, DOT would work with
                outside third-party vendors, such as ATPCO, to make data collection and
                reporting services available to all O&D Survey Reporting Carriers. The
                Department seeks comment on whether any further accommodation is
                necessary for these smaller air carriers.
                2. Foreign Air Carriers That Are Not O&D Survey Reporting Carriers
                 Under the proposed rule, foreign air carriers would not report
                passenger O&D data under 14 CFR part 241, Sec. 19-8, which is
                consistent with current reporting requirements. However, foreign air
                carriers would still need to report data as required by a grant of
                antitrust immunity under 49 U.S.C. 41308 and 41309, which represent a
                separate set of reporting regulations. O&D Survey Reporting Carriers
                will determine if a foreign air carrier that reports under 49 U.S.C.
                41308 and 41309 issued a ticket, and if so, the O&D Survey Reporting
                Carrier will not be responsible for reporting the ticket.
                3. O&D Survey Reporting Carriers List
                 The proposed rule would require that DOT post the O&D Survey
                Reporting Carriers List one month in advance of its monthly effective
                date to ensure that O&D Survey Reporting Carriers are aware of all
                updates and give the O&D Survey Reporting Carriers time to update their
                internal processes to comply with reporting requirements.\13\ For
                example, an update to the list posted January 31st would be effective
                for reporting beginning in March. The O&D Survey Reporting Carriers
                List would be updated as soon as administratively possible when an O&D
                Survey Reporting Carrier becomes qualified or is disqualified as an O&D
                Survey Reporting Carrier.
                ---------------------------------------------------------------------------
                 \13\ Domestic air carriers may change their business model from
                one of only providing contract lift, not holding out scheduled air
                service and not issuing tickets, to selling their own services. When
                this occurs, the carrier will need to be added to the O&D Survey
                Reporting List. The same may happen in reverse requiring a carrier
                to be removed from the list. This same process applies to foreign
                air carriers immunized under 49 U.S.C. 41308 and 41309. They may
                also be added or removed from the list depending on their immunity
                status.
                ---------------------------------------------------------------------------
                F. Increasing the Frequency of Reporting
                 The proposed rule would require O&D Survey Reporting Carriers to
                report data monthly instead of the current quarterly reporting period.
                Information would have to be reported to the Department no later than
                45 days after the last day of a reporting month. This would make the
                data available to stakeholders on an
                [[Page 5057]]
                expedited basis compared to the existing quarterly reporting and
                enables users to validate it against other data disseminated monthly,
                such as the T-100.
                G. Expanding Data Elements Collected
                 Through discussions with A4A, the Department determined the
                expanded data elements selected below are already collected and
                maintained by industry and therefore are minimally burdensome to
                collect. The Department may expand or change the regulatory language to
                include further definition of the requirements for submission, subject
                to the comments received for the final rulemaking.
                1. Reporting Scheduled Year and Month of Travel
                 The proposed rule would require the O&D Survey Reporting Carriers
                to report the scheduled year and month of departure of each flight
                coupon. Providing this level of granularity would increase the utility
                of the O&D Survey by enabling users to, for example, better compare
                economic activity in the aviation sector against other measures of
                economic activity in the economy that are reported monthly, or with
                other aviation traffic data collected by DOT. Including month of travel
                also would make it easier to validate the submissions against other
                data sources, such as the T100 and T-100(f). Data in the O&D Survey
                currently cannot properly support a direct comparison to 3 months of T-
                100/T-100(f) data because the current survey reporting includes data
                with travel dates outside of the three months of the quarterly O&D
                reporting window that cannot be identified in the collected data;
                therefore, the data cannot be accurately segmented on specific time
                periods for comparison with the T-100 or T-100(f).
                2. Reporting All Airports in the Itinerary Including Via Airports
                 The proposed rule would require reporting of Eligible Tickets to
                include all airports wherein the passenger is scheduled to travel, even
                when the passenger does not deplane. Whereas most tickets document
                travel that consists of flight coupons with one aircraft take-off and
                one aircraft landing, sometimes the passenger is on a flight that lands
                at an airport but the passenger remains on board. This airport is not
                expressly identified in the ticket, and is generally referred to as a
                ``via'' airport. The current rules of the O&D Survey do not allow for
                the reporting of ``via'' airports. Collecting this information would
                enable data users to understand better how passengers travel through
                various airline networks, and would provide the necessary information
                for relating T100/T100(f) segment data directly to O&D Survey
                information.
                 Identifying the ``via'' airports, currently hidden in an itinerary,
                requires knowledge of the flight number, because each flight number has
                its own unique routing, as well as the date of the scheduled travel,
                because schedules change within monthly boundaries and some flight
                number schedules change by day-of-week (e.g., differing weekday and
                weekend flight itineraries). The Department is not proposing to require
                the reporting of flight number and flight date. Instead, DOT proposes
                that the O&D Survey Reporting Carriers report the ``via'' airport in a
                ``Via Airport'' field because the O&D Survey Reporting Carrier knows
                the flight number and flight date while the Department does not.
                3. Reporting Dwell Time
                 The proposed rule would assist DOT in creating a more accurate
                record of the passenger's intended destination (i.e., true O&D) by
                requiring O&D Survey Reporting Carriers to report the number of hours
                elapsed between the passenger's arrival at an airport on a flight and
                the passenger's departure from the next airport in the tickets travel
                sequence. The standard measure of continuity of a journey in the
                industry is time between flights at an airport, or ``dwell time.''
                Reporting ``dwell time'' would enable users to make an accurate
                determination of when a passenger has reached a destination versus when
                the passenger is simply waiting for a connecting flight to the intended
                destination. For example, when a passenger stays only an hour or two at
                an airport, the airline assumes that this airport is not an intended
                destination but, instead, the passenger was only at that airport to
                travel onward to an intended destination.
                 As the O&D Survey Reporting Carrier knows the flight dates and
                flight times on an individual ticket, the Department proposes that the
                O&D Survey Reporting Carriers report in one hour increments the number
                of hours elapsed between a passenger's arrival and the passenger's
                departure from an Airport, rounding up to the nearest whole hour. This
                measure of time would be reported as a new element, ``Dwell Time.''
                4. Reporting an Exchanged Ticket Indicator
                 The proposed rule adds a new element, the ``Exchanged Ticket
                Indicator,'' to notify O&D Survey data users that a ticket may warrant
                further examination. The proposed rule would continue to require that
                tickets issued in exchange for unused coupons of a previously issued
                ticket be reported. For Exchanged Tickets, the user of the data would
                be alerted that the value reported as the Total Amount may include a
                form of payment from unused coupons of a previously issued ticket.
                5. Reporting a Frequent Flyer Program Ticket
                 The Department seeks comment on whether O&D Survey Reporting
                Carriers should report whether a ticket was purchased in part or in
                whole by redemption through a Frequent Flyer Program (FFP). The user of
                the data would be alerted that the value reported as the Total Amount
                may include a form of payment by redemption of FFP miles or points.
                6. Reporting Total Amount and Tax Amount
                 The rule proposes adding a data element for the ``Tax Amount'' to
                understand the effect of government policy on aviation and allow data
                users the ability to separate taxes paid from the total fare. The rule
                also proposes to rename the currently reported element ``Total Dollar
                Value'' to ``Total Amount.''
                a. Total Amount
                 The proposed rule would keep the reporting element ``Total Dollar
                Value'' but change the name of the reporting element to the industry
                standard term ``Total Amount'' and clarify the instructions for
                populating the data element. For all Eligible Tickets, the O&D Survey
                Reporting Carrier would report the Total Amount paid for the ticket
                that was mandatory for the passenger to board the aircraft. The
                Department proposes that the Total Amount would include all mandatory
                carrier-imposed charges and government-imposed fees and taxes. Carrier-
                imposed charges, which are variously described as fuel surcharges,
                ticketing, check-in, seat, or other fees or charges that are mandatory,
                that a passenger must pay to board the aircraft would be included. In
                addition, the amount of non-airline imposed taxes and fees for the
                ticket would be included. The Total Amount would not include charges
                for optional or ancillary services such as baggage fees, premium seat
                fees, or ticket change fees. For example, if a consumer can choose a
                no-cost seat or seating category, but chooses to purchase a particular
                seat or seating category, that fee should not be included. However, if
                a passenger has a
                [[Page 5058]]
                choice of seats or seating categories, but there is a cost associated
                with all the options and the consumer must pay a fee regardless of
                which option is chosen, the fee is mandatory and that fee should be
                included in the total cost of the ticket. Regarding mandatory ticket
                purchase fees, if the passenger must pay a fee the amount of which
                depends on the outlet from which the ticket is purchased (e.g., one fee
                for online purchases, a slightly higher (or lower) fee for telephone
                purchases, and a slightly lower (or higher) fee for purchases at the
                ticket counter), payment of one of those fees is mandatory, and the fee
                paid by the passenger should be reported. However, if there is an
                outlet for which there is no ticket fee (e.g., online purchases) and
                the only additional purchase fees are for tickets purchased via the
                airline's disfavored outlets, such as telephone or in-person sales,
                then the fee is not mandatory and would not need to be included in the
                ``Total Amount'' reported to the Department.
                 The Department seeks comment on whether an ``optional'' ticket
                purchase fee collected from most tickets sold by a carrier should be
                included in the Total Amount of the ticket. For example, if there is a
                disfavored outlet, such as in-person sales, for which there is no
                ticket fee, but a ticket fee is collected from tickets sold from the
                outlet a majority of passengers use (e.g., online purchases), should
                this fee be included in the Total Amount of the ticket? If yes, what
                should the threshold be--greater than 50 percent of tickets sold?
                 When reporting Category Two Tickets, the O&D Survey Reporting
                Carrier may not have access to the accounting system of the Issuing
                Carrier. However, because ticket information is routinely shared
                between air carriers and foreign air carriers when transporting shared
                passengers, it can be expected that the O&D Survey Reporting Carrier
                would report as accurately as possible the Total Amount based on the
                information shared by the Issuing Carrier.
                b. Tax Amount
                 The proposed rule would create a new reporting element, ``Tax
                Amount.'' Along with informing tax policy, this change would allow
                users of the data to determine the actual passenger revenue retained by
                an airline. For Category One Tickets, the O&D Survey Reporting Carrier
                would report the aggregate of fees and taxes imposed by external
                entities (e.g., airport operating authorities and government
                jurisdictions) and paid by the passenger as the Tax Amount, and would
                exclude all carrier-imposed fees.
                 When reporting Category Two Tickets, the O&D Survey Reporting
                Carrier may not have access to the accounting system of the Issuing
                Carrier. However, since ticket information is routinely shared between
                air carriers and foreign air carriers in the normal course of business
                when transporting interline passengers, it can be expected that the O&D
                Survey Reporting Carrier would report as accurately as possible the Tax
                Amount based on the information shared by the Issuing Carrier.
                 An alternative approach would be to require that the O&D Survey
                Reporting Carrier report all taxes and non-carrier fees separately,
                instead of the current proposal to aggregate the taxes and fees into
                one lump sum. The Department seeks comment regarding the utility to
                users and additional burden to O&D Survey Reporting Carriers of
                reporting individual tax and fee amounts instead of reporting the
                aggregate amount of taxes and fees.
                c. Currency and Fractions of a Dollar
                 The rule proposes all amounts would be reported in United States
                Dollars (USD), rounded to two decimal places. The rule does not propose
                to impose a uniform methodology for the conversion of foreign currency
                to USD. O&D Survey Reporting Carriers would, however, be expected to
                use a currency conversion methodology that is generally accepted within
                the industry.
                7. Record Identification Number
                 The rule proposes the creation of a unique Record Identification
                Number (Record ID) generated by the O&D Survey Reporting Carrier for
                each Eligible Ticket submitted to the O&D Survey. This would allow the
                Department to communicate precisely to the O&D Survey Reporting Carrier
                any records that may have missing or incomplete data elements, or are
                otherwise flagged for review. The Department seeks comment on how to
                standardize the format of the Record ID by incorporating helpful
                elements, such as the month and year of travel, plate code of the O&D
                Survey Reporting Carrier, ticket number, or origin/destination, while
                at the same time preserving the number as a unique record identifier.
                8. Removal of Fare Basis Code
                 The Department seeks comment on whether to cease reporting the Fare
                Basis Code as currently collected, the usefulness of such a data
                element, and how this data element could be revised to minimize the
                burden on O&D Survey Reporting Carriers. Currently, O&D Survey
                Reporting Carriers must map their fare types to a standard set of
                government-defined definitions that do not always match well with their
                business model-specific products, resulting in inconsistent fare basis
                codes being assigned across carriers. Ceasing to report Fare Basis
                Codes would also decrease the burden on the O&D Survey Reporting
                Carriers. Alternatively, the O&D Survey could collect fare class or a
                replacement data element instead, such as cabin class of ticket
                purchased. The Department believes that such a data element would prove
                useful to a variety of industry stakeholders, and would also allow
                users of the data to segment average fares.
                V. Proposed Changes to Dissemination of Data
                A. Changes to Dissemination of O&D Survey Data
                 By collecting data on a monthly basis, instead of quarterly, this
                proposed rule would allow DOT the ability to disseminate the O&D Survey
                statistics more frequently. The Department, however, must balance the
                value of providing timely information to stakeholders with the need to
                protect the business confidentiality of the air carriers. Currently,
                O&D Survey data is typically released 90 days from the end of the
                reporting quarter. The Department proposes withholding the O&D Survey
                monthly data for a minimum of 60 days from the end of the Reporting
                Year and Month. DOT seeks comment on the appropriate amount of time to
                withhold data from dissemination that would still protect the
                competitive interests of the air carriers.
                 Another data dissemination issue is the restrictions placed on the
                release of domestic carrier-submitted itineraries with foreign origin
                and destination points in the O&D Survey to non-U.S. citizens.
                Currently, because data covering the operations of foreign air carriers
                that is similar to the information collected in the O&D Survey is not
                available, international itinerary data in the Passenger Origin-
                Destination Survey is not generally disclosed because of the potential
                damaging competitive impact on U.S. carriers and the adverse effect
                upon the public interest that would result from unilateral disclosure
                of data related to foreign markets (14 CFR part 241, Sec. 19-7(d)). The
                disclosure policy identifies exceptions for government interests and
                for air carriers contributing data to the O&D Survey. The international
                travel data is available to persons upon a showing that the
                [[Page 5059]]
                release of the data will serve specifically identified needs of U.S.
                users which are consistent with U.S. interests (14 CFR part 241, Sec.
                19-7(d)).
                 The Department is not contemplating a change to its policy
                regarding the release of international travel data; however, DOT
                proposes adding the descriptor ``citizens and non-citizens'' to the
                other persons offered an opportunity to receive the data based on
                specifically identified needs and consistency with U.S. interests. The
                Department seeks comment on the advisability of this clarification of
                language, and whether to grant non-citizens access to the O&D Survey
                data under these circumstances. Finally, DOT seeks comment on whether
                to replace the phrase ``specifically identified need'' with a defined
                list of permissible, specifically identified needs that would be
                codified in the regulation, and, if so, what that defined list should
                include.
                 All itineraries that contain a foreign point and involve a U.S. O&D
                Survey Reporting Carrier in the itinerary, regardless of whether a
                domestic or foreign air carrier reports it, would continue to be made
                available under the disclosure policy discussed above.
                B. Changes to Dissemination of T-100/T-100(f)
                 The Department is considering shortening the time that it withholds
                public release of the T-100(f). Such a change would not only expedite
                public access to O&D Survey data, but it would also make the T-100(f)
                release more consistent with T-100 domestic data by having each
                released on the same schedule. This would simplify the process of using
                DOT's aviation data products by making it easier to harmonize domestic
                and international planning tasks. Considering the increased utility of
                the data in the O&D Survey, DOT is requesting comment on shortening the
                time that T-100(f) is withheld from the current 6 months to 3 months.
                VI. Complete List of Elements To Report
                 Below is the proposed list of all elements that would be reported
                in the O&D Survey. Elements marked with an asterisk (*) indicate new or
                significantly changed elements. Elements for each submitted report
                would be submitted only once with each report; elements for each
                submitted ticket would be submitted once for each ticket; and elements
                submitted for each airport in the ticket sequence of travel would be
                submitted once for each airport in the sequence of travel.
                A. Elements for Each Submitted Report
                 O&D Survey Reporting Carrier Identifier: The two-character
                International Air Transport Association (IATA) identifier of the air
                carrier that reports the ticket.
                 Reporting Year: Year in which a coupon in a ticket is used
                for air transportation for the first time.
                 Reporting Month:* Month in which a coupon in a ticket is
                used for air transportation for the first time.
                B. Elements for Each Submitted Ticket
                 Record Identification Number:* A unique number assigned by
                the O&D Survey Reporting Carrier to each Eligible Ticket submitted to
                the O&D Survey, allowing DOT to precisely communicate to the O&D Survey
                Reporting Carrier any records that may have missing or incomplete data
                elements, or are otherwise flagged for review.
                 Issuing Carrier:* The two character IATA/DOT identifier of
                the air carrier or foreign air carrier that issued the ticket.
                 Total Amount: The gross total of funds collected on a
                ticket by the Issuing Carrier for the transportation of a passenger,
                inclusive of taxes and fees imposed by non-carrier entities or air
                carriers, and exclusive of ancillary fees not required to board the
                plane charged by the air carrier.
                 Tax Amount:* The portion of the Total Amount that is
                imposed by and remitted to a non-air carrier entity, such as a
                government. This value may also include airport-imposed taxes or fees
                assessed by privately operated airports.
                 Exchanged Ticket Indicator:* A record indicator when at
                least one form of payment for the ticket is one or more Coupons of a
                previously issued ticket.
                C. Elements for Each Airport in the Ticket Sequence of Travel
                 Airport: The IATA/DOT airport code of the station in the
                ticket's sequence of travel that represents the point of embarkation
                for the flight segment indicated by Operating Carrier, Marketing
                Carrier, Scheduled Flight Year, Scheduled Flight Month. The elements
                Dwell Time, and Via Airport would apply to this Airport.
                 Operating Carrier: The IATA/DOT designator code for the
                air carrier or foreign air carrier whose aircraft are used to operate
                from the subject airport.
                 Marketing Carrier: The IATA/DOT designator code for the
                air carrier or foreign air carrier which marketed the seat on the
                aircraft that is scheduled to depart that appears on the flight segment
                for the subject airport. In the case of a Franchise (contract lift) or
                Marketing Codeshare, the Operating Carrier would be different than the
                Marketing Carrier.
                 Scheduled Flight Year:* Departure year in which the flight
                is scheduled to depart the subject Airport.
                 Scheduled Flight Month:* Departure Month in which the
                flight is scheduled to depart the subject Airport.
                 Dwell Time:* A value that describes the time reported in
                one hour increments between the time a passenger arrived at the subject
                airport and departed from the subject airport. When an itinerary shows
                that the passenger arrives at an airport that is different from the
                departure airport (i.e., there is a surface segment in the itinerary),
                the Dwell Time would still report the elapsed time between arrival and
                departure by air.
                 Via Airport(s):* Any points of scheduled stopover or
                connection at airports as part of a ``direct'' or ``through'' flight.
                VII. Implementation and Compliance Date
                 The Department proposes that the compliance date for these
                improvements to the O&D Survey would be no earlier than one year from
                the publication of the final rule. The Department envisions the
                submission of 12 months of data under Sec. 19-8 for testing and
                validation as sufficient to resolve any problems that may arise in the
                submission and processing of data. DOT seeks comment on what a
                reasonable compliance date would be based on the scope of the proposal
                in this NPRM.
                 Carriers would continue to report under Sec. 19-7 until such a time
                that it is determined by DOT that testing and validation of data
                submitted under Sec. 19-8 is complete and suitable to replace data
                collected under Sec. 19-7 as the statistics of record. The Department
                seeks comment on this reporting requirement.
                VIII. Regulatory Analysis and Notices
                A. E.O. 12866 (Regulatory Planning and Review), E.O. 13563 (Improving
                Regulation and Regulatory Review), E.O. 13771 (Reducing Regulation and
                Controlling Regulatory Costs), and DOT Regulatory Policies and
                Procedures (49 CFR Part 5)
                 This rulemaking is not considered a significant regulatory action
                under section 3(f) of E.O. 12866,\14\ as supplemented by E.O.
                13563,\15\ which define a significant regulatory action as one that is
                likely to result in a rule that may have an annual effect on the
                [[Page 5060]]
                economy of $100 million or more or adversely affect, in a material way,
                the economy, a sector of the economy, productivity, competition, jobs,
                the environment, public health or safety, or State, local, or tribal
                governments or communities. The impact on the economy would be less
                than $100 million; it would create no conflicts with actions taken by
                other agencies; it would not alter budgetary impacts of entitlements,
                grants, fees, or loans; nor would it raise any unusual legal or policy
                issues.
                ---------------------------------------------------------------------------
                 \14\ 58 FR 51735; September 30, 1993.
                 \15\ 76 FR 3821; January 21, 2011.
                ---------------------------------------------------------------------------
                 This proposed regulatory action would modify an existing regulation
                and is expected to result in cost savings to producers and users of the
                data as well as to the Federal government. The proposed action is also
                expected to result in benefits to users of the data, including the O&D
                Survey Reporting Carriers themselves.
                1. Cost Savings
                 The net costs of the proposed rule were determined by comparing the
                costs of the existing system to the projected costs with the proposed
                modification. The Department's analysis identified three primary
                categories of potential cost reductions:
                 Cost reductions to data producers: The reduction in the
                costs of producing information for government reporting, due to
                technological simplification of data processing and submission.
                 Cost reductions to the government: The reduction in costs
                to edit, manipulate, and validate the O&D data for release.
                 Cost reductions to the public/users of the data: The
                reduction in time that users must spend applying specialized analytical
                skills to manipulate and adjust the data to account for current
                deficiencies in the Origin and Destination Survey.
                 Cost reductions to data producers include costs for accounting and
                auditing clerks, computer systems analysts, and computer programming
                analysts that are part of the ongoing production of data by the air
                carriers. Labor rates were taken based on Bureau of Labor Statistic's
                Standard Occupational Classification (SOC) and hours were estimated
                based on industry input for current operations. Average cost per
                airline based on the labor rates and estimated hours was then
                calculated, and this was multiplied by the expected number of carriers
                that will report over a 10-year timeframe. The ``as is'' costs were
                then compared to the ``to be'' costs that would be achieved under the
                proposed rule. The ``to be'' costs include the transition costs from
                the current system to the new system as well as an ongoing cost
                estimate for the processing of the data by a third-party fee-for-
                service provider. ATPCO, the leading distributor of airline fares and
                airline fare information, notified DOT that it can create software to
                assemble the O&D Survey report for any air carrier that exchanges
                ticket information using their services. ATPCO is a non-profit industry
                consortium that provides tariff services and other ticket-related
                services to air carriers and foreign air carriers ``at-cost.'' ATPCO's
                shared software would relieve air carriers from the cost of maintaining
                separate systems, each of which carries attendant secondary expenses
                for training and technical maintenance. This option would not only
                simplify the information technology operations, but also amortize the
                cost of creating and maintaining the software. Therefore, upfront costs
                resulting from this proposed action are expected to include the
                expenses related to developing, installing, and maintaining an
                automated reporting system. These upfront costs have been accounted for
                as ongoing payments to a third-party provider.
                 Cost reductions to the government include systems investment costs
                and ongoing production costs. Labor rates were taken based on Bureau of
                Labor Statistic's Standard Occupational Classification (SOC) and hours
                were based on estimates provided by the Bureau of Transportation
                Statistics (BTS), the agency responsible for the current processing.
                The ``as is'' comparison assumed the use of existing infrastructure
                while the ``to be'' assumed a 2-year development and implementation
                window as well as ongoing production costs.
                 Cost reductions to the public/users estimated for the ``as is''
                total hours users of the data spend on computer systems analysts to
                further prepare the data and the number of hours an analyst may take to
                perform final data quality procedures that must be done to ensure clean
                data for final analysis outputs. The comparison ``to be'' calculation
                includes an estimated investment cost for creating processes for the
                new data prior to its release to public/users.
                 All costs were estimated over 10 years and discounted at a 7
                percent rate.
                 Summary of Cost Savings
                ----------------------------------------------------------------------------------------------------------------
                 Costs under Costs under
                 Stakeholder the current the proposed Cost savings
                 regulation regulation
                ----------------------------------------------------------------------------------------------------------------
                Regulated Entities (Data Producers)............................. $8,355,747 $7,458,801 $896,946
                Government...................................................... 18,127,583 10,912,800 7,214,783
                Public (Data Users)............................................. 2,452,586 196,613 2,255,973
                 -----------------------------------------------
                 Total Cost Savings (10 years @7% Discount Rate)............. .............. .............. 10,367,702
                 -----------------------------------------------
                 Annualized Cost Savings..................................... .............. .............. 1,476,128
                ----------------------------------------------------------------------------------------------------------------
                 This analysis finds that the proposed modification would result in
                annualized cost savings of approximately $1.5 million at a 7 percent
                discount rate.
                2. Implementation and Transition Costs
                 To comply with the proposed revised O&D Survey, a certain
                investment is likely necessary by data producers. The proposed
                modification would simplify the design of the O&D Survey sufficiently,
                allowing for third-party providers to create fee-for-service software
                that would produce the Survey reporting records for all air carriers.
                3. Benefits to Users of the Data
                 Users of the data include both air carriers and industry-related
                entities, such as airports, manufacturers, researchers, and investors,
                who often cite the O&D Survey as one of the most critical datasets used
                to formulate short- and long-term business plans and forecast industry
                trends. Improving the quality of the O&D Survey data would also yield
                several other unquantified benefits to users of the data, including:
                 Reporting the Dwell Time between flights would help reduce
                the
                [[Page 5061]]
                difficulties and potential errors associated with determining when a
                passenger has reached a destination (``Trip Break'') and when the
                passenger is simply waiting for a connecting flight to the intended
                destination.
                 Reporting all the cities in the itinerary would better
                align O&D Survey data with the T-100, removing much of the uncertainty
                in market validation analysis. This would allow the T-100 to facilitate
                validation of O&D Survey data submissions.
                 Reporting a larger sample size to capture small and rural
                markets with the statistically significant equivalence of larger
                markets would reduce the need to make much less accurate manual
                statistical adjustments as well as increase the accuracy of data
                available for the analysis of small markets.
                 Differentiating the amount of tax collected from the
                amount of total fare collected would remove uncertainty in determining
                the actual passenger revenue retained by the airlines.
                 Reporting the month and year of travel would enable
                determinations of market trends that are not discernable inside the
                quarterly data reports and would allow direct cross-validation to other
                datasets such as the T-100.
                4. Cost-Benefit Analysis Summary
                ------------------------------------------------------------------------
                 10-Year costs
                 Major provisions of this Benefit (discounted at
                 regulatory action 7%)
                ------------------------------------------------------------------------
                Change sample size to 40%..... Would enable more The estimated
                 effective oversight total reduction
                 of Congressional in cost over 10
                 programs designed to years
                 help small discounted at
                 communities and 7% for all the
                 provide more accurate major
                 market information provisions
                 for a wide variety of would provide a
                 research and industry reduction of
                 uses. $10,367,702
                 from the cost
                 of continuing
                 the current
                 methodology.*
                Report each ticket as a single Would simplify
                 record. reporting and
                 improves quality
                 assurance.
                Designate all certificated air Would simplify the
                 carriers and commuter air reporting procedures
                 carriers holding out to enable full
                 scheduled passenger service automation of
                 as O&D Survey Reporting reporting, which
                 Carriers and require them to enhances efficiency
                 report the tickets that they and accuracy; and
                 sell. eliminate loopholes
                 in collection secure
                 integrity of the
                 sample of tickets.
                Move to monthly reporting..... Would create more
                 useful and timely
                 economic information;
                 and align the
                 reporting process
                 with the
                 corresponding
                 industry accounting
                 process.
                Report the month/year of Would create more
                 travel. useful, timely
                 economic information;
                 and align reporting
                 process with the
                 corresponding
                 industry accounting
                 process.
                Report all airports in the Would provide clarity
                 itinerary. and completeness in
                 passenger movements.
                Report Dwell Time as the Would allow accurate
                 number of hours between each determination of the
                 arrival and next departure in passenger's intended
                 the itinerary. destination based on
                 industry standard
                 practice.
                Report an Exchanged Ticket Would alert data users
                 Indicator. that the fare on a
                 specific ticket may
                 require further
                 investigation.
                Elimination of Fare Basis Code Would remove sensitive
                 reporting. business information
                 that is burdensome to
                 report.
                Report taxes paid on the Would inform tax
                 ticket. policy and allow data
                 users to separate
                 taxes paid from the
                 total fare.
                Report a Record Identification Would enable
                 Number. communication between
                 a O&D Survey
                 Reporting Carrier and
                 DOT regarding data
                 quality.
                ------------------------------------------------------------------------
                * The industry requests to align the regulation with current accounting
                 practices, which means that the system is to be restructured, so all
                 new provisions can be included in a one-time programming cost.
                 This proposed rule is expected to be an E.O. 13771 deregulatory
                action.\16\ As is described above in the discussion of the benefit-cost
                analysis that was conducted for the proposed rule, this action is
                expected to result in annualized cost savings (to producers and users
                of the data and the Federal Government) of approximately $1.5 million
                per year, while also yielding additional unquantified benefits to users
                of the data through improved data quality and utility.
                ---------------------------------------------------------------------------
                 \16\ 82 FR 9339; Feb. 3, 2017.
                ---------------------------------------------------------------------------
                B. The Unfunded Mandates Reform Act of 1995.
                 The Unfunded Mandates Reform Act of 1995 \17\ requires Federal
                agencies to prepare a written assessment of the costs, benefits, and
                other effects of proposed or final rules that include a Federal mandate
                likely to result in expenditures by State, local, or tribal
                governments, in the aggregate, or by the private sector, of more than
                $100 million annually. The proposed changes we are considering making
                to the aviation data collections would not result in expenditures by
                State, local, or tribal governments.
                ---------------------------------------------------------------------------
                 \17\ 2 U.S.C. 1531-1538.
                ---------------------------------------------------------------------------
                C. Regulatory Flexibility Act
                 The Regulatory Flexibility Act \18\ requires an agency to assess
                the impacts of proposed and final rules on small entities unless the
                agency determines that a rule is not expected to have a significant
                economic impact on a substantial number of small entities. The
                Department has evaluated the effects of this action on small entities
                and anticipates that the action will not have a significant economic
                impact on a substantial number of small entities.
                [[Page 5062]]
                The small entities which will begin reporting the data collected under
                this proposed rule routinely collect this data as a normal course of
                business, as a necessity to common industry accounting practices. The
                Department hereby certifies that this action would not have a
                significant economic impact on a substantial number of small entities.
                ---------------------------------------------------------------------------
                 \18\ 5 U.S.C. 601 et seq.
                ---------------------------------------------------------------------------
                D. E.O. 13132 (Federalism)
                 E.O. 13132 \19\ requires agencies to ensure meaningful and timely
                input by State and local officials in the development of regulatory
                policies that may have a substantial, direct effect on the States, on
                the relationship between the National Government and the States, or on
                the distribution of power and responsibilities among the various levels
                of government. The Department has analyzed this action in accordance
                with the principles and criteria contained in E.O. 13132. This rule
                does not include any provision that substantially directly affect the
                States, the relationship between the National Government and the
                States, or the distribution of power and responsibilities among the
                various levels of government. It imposes no direct compliance costs on
                State and local governments nor does it preempt State law. States are
                already preempted from regulating in this area by the Airline
                Deregulation Act.\20\ Therefore, the consultation and funding
                requirements of E.O. 13132 do not apply.
                ---------------------------------------------------------------------------
                 \19\ 64 FR 43255; August 10, 1999.
                 \20\ 49 U.S.C. 41713.
                ---------------------------------------------------------------------------
                E. E.O. 13175 (Consultation and Coordination With Indian Tribal
                Governments)
                 The proposed changes to the O&D Survey would not have tribal
                implications, impose substantial direct compliance costs on Indian
                tribal governments, or preempt tribal law. Therefore, this NPRM is
                exempt from the consultation requirements of E.O. 13175, ``Consultation
                and Coordination with Indian Tribal Governments.'' \21\ If tribal
                implications are identified during the comment period, the Department
                will undertake appropriate consultations with the affected Indian
                tribal officials.
                ---------------------------------------------------------------------------
                 \21\ 65 FR 67249; November 9, 2000.
                ---------------------------------------------------------------------------
                F. Paperwork Reduction Act
                 The Paperwork Reduction Act of 1995 (PRA) \22\ requires that the
                Department consider the impact of paperwork and other information
                collection burdens imposed on the public and obtain approval from the
                Office of Management and Budget (OMB) for each collection of
                information it conducts, sponsors, or requires through regulations.
                ---------------------------------------------------------------------------
                 \22\ 44 U.S.C. 3501, et seq.
                ---------------------------------------------------------------------------
                 This action contains the following proposed amendments to the
                existing information collection requirements previously approved under
                OMB Control Number 2105-AE45. As required by the PRA, DOT has submitted
                these proposed information collection amendments to OMB for its review.
                 Summary: Origin-Destination Survey of Airline Passenger Traffic
                (O&D Survey), which collects information on the origin and destination
                of passengers including, at a minimum, information on: (1) The origin
                and destination of passengers in interstate air transportation, and (2)
                the number of passengers traveling by air between any two points in
                interstate air transportation. Modifications to the existing
                requirements would include making the air carrier that issues the
                ticket primarily the carrier responsible for submitting the ticket,
                reporting each ticket as a single record, expanding the O&D Survey
                Reporting Carrier threshold, changing the period of reporting to
                monthly, increasing the sample size to 40 percent, reducing the lag
                time for release of T-100(f), adding dwell time, adding a Via Airport
                data element, adding a Total Tax element, adding Travel Year and Travel
                Month as recorded elements, adding an Exchange Ticket Indicator, adding
                a Reporting Record Identifier, and removing the requirement to record
                the Fare Basis Code.
                 Use: The Department is obligated by statute to collect and
                disseminate this information. There are many private and public
                stakeholders that depend on this data to make decisions on aviation
                business and policy. For example, this data is used by the industry to
                plan air services, develop commercial aviation infrastructure, measure
                the economic impact of passenger flows, and create business plans for
                start-up airlines. The O&D Survey is also a primary source of
                information used to quantify and evaluate the effectiveness of Federal
                aviation policy and programs as well as develop and implement new
                policies and infrastructure initiatives.
                 Respondents (including number of): All certificated air carriers
                and commuter air carriers holding out scheduled passenger service. The
                Department currently estimates approximately 27 air carriers will
                qualify to submit data to the O&D Survey as envisioned by this
                rulemaking.
                 Frequency: Monthly.
                 Annual Burden Estimate: The Department is soliciting comments to--
                 (1) Evaluate whether the proposed information requirement is
                necessary for the proper performance of the functions of the agency,
                including whether the information will have practical utility;
                 (2) Evaluate the accuracy of the agency's estimate of the burden;
                 (3) Enhance the quality, utility, and clarity of the information to
                be collected; and
                 (4) Minimize the burden of collecting information on those who are
                to respond, including by using appropriate automated, electronic,
                mechanical, or other technological collection techniques or other forms
                of information technology.
                 Individuals and organizations may send comments on the information
                collection requirement by March 19, 2021, 11:59 p.m. Eastern Time, and
                should direct them to the address listed in the ADDRESSES section at
                the beginning of this preamble. Comments should also be submitted to
                the Office of Management and Budget, Office of Information and
                Regulatory Affairs, Attention: Desk Officer for OST, New Executive
                Building, Room 10202, 725 17th Street NW, Washington, DC 20053.
                G. National Environmental Policy Act
                 The Department has analyzed the environmental impacts of this
                proposed action pursuant to the National Environmental Policy Act of
                1969 (NEPA) (42 U.S.C. 4321, et seq.) and has preliminarily determined
                that it is categorically excluded pursuant to DOT Order 5610.1C,
                Procedures for Considering Environmental Impacts (44 FR 56420, Oct. 1,
                1979). Categorical exclusions are actions identified in an agency's
                NEPA implementing procedures that do not normally have a significant
                impact on the environment and therefore do not require either an
                environmental assessment (EA) or environmental impact statement (EIS).
                The purpose of this rulemaking is to update the method of collecting
                and processing aviation traffic data as well as expanding the number of
                reporting air carriers, the sample size collected, and the scope of the
                data reported in the O&D Survey. The Department does not anticipate any
                environmental impacts, and there are no extraordinary circumstances
                present in connection with this rulemaking.
                H. Regulation Identifier Number
                 2105-AE45.
                [[Page 5063]]
                List of Subjects
                14 CFR Part 241
                 Air carriers, Reporting and recordkeeping requirements, Uniform
                system of accounts.
                14 CFR Part 298
                 Air taxis, Reporting and recordkeeping requirements.
                 Issued in Washington, DC.
                Elaine L. Chao,
                Secretary of Transportation.
                Proposed Rule
                 Accordingly, the Department proposes to amend 14 CFR parts 241 and
                298 as follows:
                PART 241--UNIFORM SYSTEM OF ACCOUNTS AND REPORTS FOR LARGE
                CERTIFICATED AIR CARRIERS
                0
                1. The authority citation for part 241 continues to read as follows:
                 Authority: 49 U.S.C. 329, 41101, 41708, and 41709.
                Sec. 19-7 [Removed]
                0
                2. Remove Sec. 19-7.
                0
                3. Add Sec. 19-8 to read as follows:
                Sec. 19-8 Passenger Origin--Destination Survey applicability.
                 (a) All U.S. certificated and commuter air carriers conducting
                scheduled passenger services (except helicopter carriers) shall
                participate in a Passenger Origin-Destination (O&D) Survey covering
                domestic and international air carrier operations, as prescribed by the
                Department's Bureau of Transportation Statistics (BTS), Office of
                Airline Information (OAI).
                 (b) A statistically valid sample of flight coupons shall be
                selected for reporting purposes. The sample shall consist of a
                selection of all Tickets involving a Reporting Carrier that meet the
                reporting criteria as defined in the Instructions, or further defined
                in Directives, except those participating O&D carriers with nonstandard
                ticketing procedures, or other special operating characteristics, may
                propose alternative procedures. Such departures from standard O&D
                Survey practices shall not be authorized unless approved in writing by
                the Director, Office of Airline Information under the procedures in
                Sec. 1-2. The data to be recorded and reported, as stipulated in the
                Instructions and Directives, shall include at a minimum the following
                data elements: Reporting Carrier, Reporting Month, Reporting Year,
                Record Identification Number, Issuing Carrier, Total Amount, Tax
                Amount, Exchanged Ticket Indicator, Airport, Operating Carrier,
                Marketing Carrier, Scheduled Flight Year, Scheduled Flight Month, Dwell
                Time and Via Airport(s).
                 (c) Any Ticket that is submitted that involves a O&D Survey
                Reporting Carrier providing service in whole or in part under this part
                or 49 U.S.C. 41308 or 41309 and any data covering the operations of
                foreign air carriers that are similar to the information collected in
                the Passenger Origin-Destination Survey are generally not available to
                the Department, the U.S. carriers, or U.S. interests. Therefore,
                because of the damaging competitive impact on U.S. carriers and the
                adverse effect upon the public interest that would result from
                unilateral disclosure of the U.S. survey data, the Department will not
                disclose the international data in the Passenger Origin-Destination
                Survey except:
                 (1) To an air carrier directly participating in and contributing
                input data to the Survey or to a legal or consulting firm designated by
                an air carrier to use on its behalf O&D data in connection with a
                specific assignment by such carrier;
                 (2) To parties to any proceeding before the Department to the
                extent that such data are relevant and material to the issues in the
                proceeding upon a determination to this effect by the Administrative
                Law Judge or by the Department's decision-maker. Any data to which
                access is granted pursuant to this section may be introduced into
                evidence subject to the normal rules of admissibility of evidence.
                 (3) To agencies and other components of the U.S. Government.
                 (4) To other persons upon a showing that the release of the data
                will serve specifically identified needs of U.S. users which are
                consistent with U.S. interests.
                 (5) To foreign governments and foreign users as provided in formal
                reciprocal arrangements between the foreign and U.S. Governments for
                the exchange of comparable O&D data.
                 (6) Or as otherwise determined by the Department as consistent with
                its regulatory functions and responsibilities.
                 (d) Each O&D Survey Reporting Carrier shall maintain its prescribed
                reportable records in a manner and at such locations as will permit
                ready accessibility for examination by representatives of DOT. The
                record retention requirements are prescribed in part 249 of this
                chapter.
                PART 298--EXEMPTIONS FOR AIR TAXI AND COMMUTER AIR CARRIER
                OPERATIONS
                0
                4. The authority citation for part 298 continues to read as follows:
                 Authority: 49 U.S.C. 329 and chapters 401, 411, and 417.
                0
                5. In Sec. 298.60, revise paragraph (a) to read as follows:
                Sec. 298.60 General reporting instructions.
                 (a) Each commuter air carrier and each small certificated air
                carrier shall file the applicable schedules of Form 298-C, ``Report of
                Financial and Operating Statistics for Small Aircraft Operators'',
                Schedule T-100, ``U.S. Air Carrier Traffic and Capacity Data by Nonstop
                Segment and On-Flight Market'', and the ``Passenger Origin--Destination
                Survey'' prescribed in part 241, Sec. 19-8, of this subchapter.
                * * * * *
                [FR Doc. 2020-29229 Filed 1-15-21; 8:45 am]
                BILLING CODE 4910-9X-P
                

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