NBAA’s President reflects on year one in the NBAA hot seat.
Shortly after September 7- 2004- the day Ed Bolen moved to the National Business Aviation Association (NBAA) from the General Aviation Manufacturers Association (GAMA)- he agreed to a World Aircraft Sales ten-question interview. In that conversation- Bolen talked about the differences he perceived between his old position – running a trade association for general aviation manufacturers and suppliers – and his new post heading up an organization with a vastly larger membership of operators with dozens of member-oriented programs. He also talked about the goals shared by the two associations.
Almost exactly a year after Ed Bolen took over the NBAA reins- he sat down again with us to examine the challenges of the 12 months just past- and those coming downstream.
In the intervening year- Bolen helped NBAA remain true to its mission- his leadership marked by the continuity that only a business aviation insider could bring to the post. He won praise for his effectiveness and his ability to keep the association on track in a way Bolen’s immediate predecessor had not. And he attracted several new executives with depth in their respective fields matched by a scant few others in aviation.
Bolen himself lauded the NBAA’s professional staff- who had weathered the post-John Olcott management change that challenged the tone set by the long-time NBAA president. Not only did Bolen become a common and frequent face at NBAA conventions during Olcott’s tenure – as had his GAMA predecessor Edward Stimpson – but also- he cemented GAMA’s partnership with NBAA on many important initiatives.
In his first year at NBAA- Bolen has cemented his position as spokesman and policy leader for the association of business aircraft operators. Through his appearances at NBAA-sponsored forums and regional events around the country- as well as the international business aviation events that earlier this year expanded into Asia- Bolen has established his leadership.
With that year under his belt – and with the 58th NBAA Convention on the horizon Nov. 9-11 – we put ten new questions to Bolen.
WAS: It’s been 12 months – busy- challenging months- from our vantage point – since you assumed your post as head of NBAA. Can you tell us what you feel were the high points and low points of that first year?
Bolen: I’ve been travelling a lot! I’ve had a real challenging and rewarding 12 months. I think the most important part of it was going back and re-evaluating where we want NBAA to go and establishing a five-year strategic action plan to guide the Association. You have to know where you want to go before you get there.
Another high point has been to be able to recruit high talent to NBAA and promote good people from within. It’s been a very positive and rewarding aspect of the year.
Yet another rewarding part has been getting out to talk to other associations and our members. We have to have open lines of communications between our members and our staff and the membership and the board. We need to give the membership an idea of what we’re doing and why we’re doing it - and to get their feedback.
It’s also been a very challenging year in terms of safety. It has given us an opportunity to talk about how important safety is and to re-evaluate what we’re doing to promote safety. We produced a user guide for charter customers; we created a CD on landings and approaches. We updated what we’re doing to promote safety for the first time in a number of years.
It has also been exciting to work with a community that’s been very discrete- and talk to them about the importance of contacts on Capitol Hill- and communicating directly with their representatives. We created a place on our website that makes it easier for members to express their views to their lawmakers in a more direct way.
WAS: Among the major priorities when you came to NBAA was the resumption of business aviation access to Washington National Airport (DCA) and a few weeks back the general aviation community finally learned under what conditions and mechanisms those flights would resume. How do you feel about the TSA system established for resumption of private aircraft traffic to DCA? How do you feel about the lack of progress on NBAA’s Transportation Security Access Certificate program (TSAC)?
Bolen: When I came to NBAA- a lot of people questioned me and the Association on the importance of our access to Reagan National Airport: Why focus so much time and effort on a resource few use- they wanted to know. But the damage potential of authorities being able to block access to an airport was important to face or else the government could do it elsewhere. We wanted to be out there every day saying- 'This is important- tear down this barrier.'
The DHS/TSA proposals are a first step. The conditions in place are extremely onerous and- for a large part of the business aviation community- completely unworkable. But we’ve got to start somewhere. We’ve got to take the opportunity to work with officials at DCA- and as we do- many of those restrictions will go away.
When the airlines were able to resume traffic three weeks after 9/11- it was from only eight cities with major restrictions on crew and passenger screening. Now- four years later- most of those restrictions have gone away and there is service to National from more cities than before.
As for TSAC- the pilot program is progressing and we’re learning from it we’ve gotten the attention of Congress- they like it and we’re looking to expand the program. There’s been a lot of focus on Reagan and as it re-opens we’ll be able to focus more on expanding the program. But we expect to see more progress knowing Congress likes it.
WAS: While we’re still looking at the Washington Metro area- what do you see as aviation’s prospects for defeating the FAA’s proposal to make permanent the 'temporary' Washington Air Defense Identification Zone (ADIZ)? Does NBAA worry that the FAA may establish other ADIZ areas around other American cities?
Bolen: It’s a challenging situation. There seems to be a mindset in government that we need some kind of no-fly zone where they know everybody flying through the zone. I would hope over time that other mechanisms will come into play that will ease that mindset. But we’re going to have to be vigilant. We want to make the ADIZ obsolete. In terms of the FAA making another ADIZ elsewhere- the security people have made a pretty good case so far that it’s not needed elsewhere- like Chicago or New York. So far- Washington has been identified as a special place. No other cities have received that designation.
WAS: Recently- the nation suffered another trauma that deeply impacted general aviation the widespread destruction of the Gulf Coast by Hurricane Katrina. As we know- the 2005 NBAA Convention originally was planned for New Orleans- which was severely damaged by the storm. How difficult was it for the NBAA staff and directors to make the shift to Orlando and to what expected impact on the convention itself?
Bolen: The hurricane presented a real challenge to NBAA. I guess what helped us work through it was the television images that showed us what we faced.
The NBAA convention is among the largest and most-sophisticated in the U.S. We need a lot of space- an airport suitable for a static display of 150 airplanes- and a lot of hotel rooms.
Seeing our convention city underwater three months before the convention didn’t leave a lot of wiggle room. A lot of effort went in to making this work. Orlando is usually booked. We stayed in constant contact with the major exhibitors and members and talked to all the cities able to handle the show.
Fortunately- it came together and we now have a premier site in a good time frame and we’ll have a good show. We expect this to be every bit as good as any NBAA convention we’ve ever had.
WAS: Many an operator has offered to help post-Katrina relief efforts and provided lift with their aircraft- and we’ve heard of numerous business aircraft flying missions. How has NBAA played a part in the rescue and recovery efforts?
Bolen: We’ve tried to do it in a number of ways. Developing the special List Serve on our website was a way to facilitate the kind of communications necessary for pairing assets and needs.
We developed a special NBAA registry of available aircraft that we’ve made available to charitable and government efforts – more than 175 airplanes are listed.
We’ve also used staff time to work on this- getting better fuel prices- facilitating co-ordination and helping people in anyway we can deliver the help offered. All of us in business aviation have to be enormously proud of how our community has responded.
WAS: One less-apparent result of Katrina is the spike in fuel prices aircraft operators experienced – adding to the hit they also took on their cars. What are NBAA members telling you about how the higher fuel prices are effecting their operations and what’s the Association’s outlook for the short-term impact of the higher fuel costs?
Bolen: The fuel prices were a front-burner issue for business aviation operators before Katrina. The fuel price shock over the prior 18 months has been exacerbated by Katrina: It’s made some operators curtail some of their flying; it’s made others more sensitive to how they use their planes and where and when they fuel.
But there is no doubt this is a challenge. It affects everyone. Businesses are doing everything individuals do- try to identify good fuel prices- not going when they don’t have to- and working through it in the best ways they can.
WAS: From many sources- we hear that this is a boom time in business aviation operations- with hours growing (based on higher fuel purchase numbers from FBOs); manufacturers’ backlogs are growing again. The industry and community seem healthy. Is the economic fallout from Katrina a potential spoiler in this picture that the operating public needs to address?
Bolen: We’ve been experiencing a strong 2005- to date. If the economy holds- it will end a good year for business aviation. But there is a lot of uncertainty. If the economy holds- we should be on good ground. When the economy grows more than three percent- it’s usually pretty positive for general aviation. So far- growth has been a little better than three percent… but we’ll have to wait and see.
WAS: As of October- federal taxes collected on jet fuel were to be remitted to the Highway Trust Fund – at the higher rate levied on highway fuel. Operators will have to seek a refund for the difference in tax paid- as well as to assure that the fuel taxes are transferred to the Airport and Airways Trust Fund where they belong. How do you expect this new law to impact your members and the aviation community?
Bolen: It’s going to be hard for people to understand because it’s just about the dumbest clause ever enacted in a tax law. Right now- (late September) the government gets 24 cents per gallon for highway fuel that goes into the Highway Trust Fund; the government gets 22 cents a gallon for Jet A aviation fuel. Because Jet A is taxed at two cents less than highway fuel- Congress decided there must be a lot of fraud in the world with people buying jet fuel and using it for highway travel.
So Congress decided when you buy fuel – as in everybody’s guilty until proven innocent – you pay the higher highway tax. And when you prove you’re an aviation user- you can apply for the two cent per gallon rebate. But people or companies have to prove they are in aviation to get their two cents excess tax back.
The dumber part of it is you can’t just use Jet fuel in your Diesel vehicle without adding something to it. You have to treat it to make it useable in a highway truck or it will foul up the engine. When you note that Jet fuel costs more than Diesel- you have to wonder where and how this 'fraud' is occurring.
Worst of all- the fuel taxes collected on Jet fuel first go into the Highway Trust Fund- where those monies stay until the payer applies for a refund. Only at the end of all this is the money moved over to the Airport and Airways Trust Fund.
Our biggest fear is that some operators won’t bother to apply for a refund of only two cents and deprive the aviation trust fund of the revenues it’s owed. It’s a mess – an absolute mess.
We tried to delay the October 1 implementation and at the same time explain on Capitol Hill how flawed their reasoning is. Now we’re trying to find a way to make sure people apply for that refund.
WAS: User fees have returned like some cinematic monster and the White House seems bent on portraying the Airport and Airways Trust Fund in the same way they’ve tried to portray Social Security – broke with in need of a radical fix. Does NBAA see this issue differently?
Bolen: The drumbeat for user fees is definite and growing louder. It’s coming from three areas for three different reasons:
It’s coming from the FAA because they need more money. They think moving to user fees is a way to generate more money for the agency. It’s coming from the airlines because they believe there’s a way to come up with a formula to shift more of the burden on general aviation.
Then there are the people at the think tanks- who believe the aviation system should be privatized- that government shouldn’t be in the business of operating the system. At the end of the day you have a lot of user fee advocates.
For a lot of people like you and me- who’ve been around for a while- there’s a tendency to believe we’ve seen it before- we won it before- we’ll win it this time. I don’t think that’s a good way to look at it.
The last time this came around- the 'Legacy Carriers' wanted user fees because they believed they could get a benefit over the upstarts like Southwest. That was really a mega battle between the Legacy Carriers and the Low Cost carriers. This time you have the Legacy and Low-Cost carriers in this together. They believe they can lower their costs and attack business aviation.
We have a fight on our hands.
WAS: Finally- what do you see as the most enjoyable moment of your first 12 months as head of NBAA?
Bolen: There’ve been a lot of good moments. Every time a good person agrees to come to work here or I’ve been able to promote someone. Every time we’re able to accomplish something in-house. Being able to announce a good site and a good time frame for our November convention- that was a particularly good day.
Having attended law school in New Orleans- this has been personally disappointing and realizing we had to face moving the convention was a low point. But we have a great convention coming at the alternative and we’ll get back to New Orleans.
WAS: Thanks- Ed! See you in Orlando.
Ed Bolen and the rest of his staff can be contacted through NBAA’s offices at National Business Aviation Association- Inc. 1200 18th St.- NW Suite 400- Washington- DC 20036-2527 Tel: +1 202 783 9000; Fax: +1 202 862 5552 Web: www.nbaa.org Photos Courtesy of NBAA