Chairman Mica, Ranking Member Lipinski, and other Members of the Subcommittee, on behalf of United Airlines' 84,000 employees worldwide, thank you for the opportunity to submit testimony for this critical infrastructure hearing. As Chicago's and Illinois' hometown airline, we appreciate the chance to explain why we strongly support H.R. 3497, the National Aviation Capacity Expansion Act, and believe swift passage of this legislation is vital to the United States and Chicago area economies, consumers and our air transportation system.

At the outset, I wish to express United's gratitude to four individuals who have made H.R. 3497 and this hearing possible. Ranking Member Lipinski has worked tirelessly to ensure that the Chicago region remains the preeminent aviation crossroad both domestically and internationally. We greatly appreciate your steadfast leadership for Chicago aviation and your efforts writing this legislation and shepherding it through the House. Chairman Mica, thank you for holding this timely hearing. You have been one of the most outspoken Congressional aviation leaders supporting much needed capacity expansion in the national aviation system. We are grateful for that leadership. Last but certainly not least, I wish to express our deep appreciation to Chicago Mayor Richard Daley and Illinois Governor George Ryan whose historic agreement is the foundation of H.R. 3497. It took a great deal of political courage, vision and hard work to reach this agreement paving the way forward for Chicago aviation to fully meet its needs up to 2030. After nearly two decades of inaction and political gridlock, thank you for helping position Chicago aviation to soar even higher.

A little over six months ago, aviation debate in the United States focussed largely on the long overdue need to expand national air transportation system capacity. The state of United States aviation conjured up images of gridlock, system choke points and congestion-related cancellations and delays. The horrific events of September 11 necessarily refocused national aviation policy. None of us ever imagined that a time might come when we looked back nostalgically on the chance to focus on system capacity as our nation's key aviation priority.

Mr. Chairman, while the downturn in commercial flights resulting from September 11 has temporarily masked our nation's air transportation infrastructure challenges, the need to address them remains more critical than ever before. As an industry, we are seeing a gradual increase in flights from September 11-related lows. As the economy recovers and the travelling public continues to gain confidence in heightened security measures, I predict that commercial flights will resume the steady path of annual growth that has been the hallmark of our industry since deregulation over two decades ago. While now certainly is the time to continue focussing on security and other impacts of September 11 on our industry, United Airlines believes it also is the time to look forward and proactively address aviation capacity challenges that inevitably will reemerge. Now, during this temporary capacity pause, Congress has the opportunity to take historic action.

That brings me to the situation at our hometown airport, Chicago's O'Hare International Airport. As Secretary Norman Mineta and others have acknowledged, O'Hare is the single worst choke point in our nation's air transportation system. Too many flights and inefficiently designed runways have proven to be a recipe for O'Hare-related congestion cancellations and delays that literally ripple nationwide. Simply put, O'Hare is a remarkable facility but badly in need of modernization. Despite the inefficient design of its seven runways, O'Hare has once again earned the title of the world's busiest airport back from Atlanta Hartsfield International Airport. However, most telling is the fact that Hartsfield runs neck-and-neck with O'Hare in terms of total annual operations with just four efficiently designed parallel runways while O'Hare competes to stay ahead while operating seven runways based on an outdated and inefficient design.

The runway capacity shortage at O'Hare did not sneak-up on United Airlines, Congressman Lipinski or the City of Chicago. The need for additional runway capacity at O'Hare has been recognized for years. For instance, in 1991, the Chicago Delay Task Force in its final report concluded that new O'Hare runways "represent the greatest opportunity to reduce delays in Chicago, particularly during bad weather conditions." More than a decade ago, a Task Force that included Chicago's Department of Aviation, the Federal Aviation Administration, airport users and air traffic controllers correctly diagnosed the problem. This group prescribed precisely the right remedy. Yet, while O'Hare-related delays increasingly ripple throughout our national air transportation system, no corrective action was taken.

The problem was political gridlock. For nearly two decades, differences in opinion among local and state officials prevented a solution from being reached to meaningfully address capacity problems confronting all Chicago airports. This impasse finally ended when Governor Ryan and Mayor Daley agreed on a historic runway redesign plan to modernize O'Hare. It is a hard fought and delicately balanced agreement between two leaders with strong views on how best to meet the air transportation needs of the Chicago area and the entire region, as well as the State. It is an agreement that United Airlines, the Chicago-area business community and an overwhelming large percentage of local residents strongly support.

H.R. 3497 and S. 1786, its companion bill offered by Senator Richard Durbin, simply codifies the Ryan-Daley agreement into federal law. Importantly for any Member sensitive that the legislation may raise Federalism issues, it does not impose a Federal decision on local decision-makers. To the contrary, it codifies a local decision. By making the Ryan-Daley agreement federal law, the National Aviation Capacity Expansion Act ensures that O'Hare expansion will become a reality in the near future by prohibiting the next Governor or Mayor from changing the terms of the agreement. The stars aligned when Governor Ryan and Mayor Daley brought their unique leadership skills to bear to meet Chicago's current and future aviation challenges. It took nearly two decades for this to happen. In the absence of Congressional action, there is no guarantee a future Governor or Mayor will not modify the agreement in a way that leads back to political gridlock, inaction for perhaps decades and continuing harm to our nation's air transportation system and the traveling public.

As Chicago's hometown airline, United obviously has a significant interest in the modernization of O'Hare. O'Hare is the anchor of our global network so the efficiency of O'Hare and the efficiency of our network are inextricably linked. Moreover, United's ongoing ability to fully respond to the traveling needs of our valued customers depends on O'Hare becoming a 21st century airport. If the Ryan-Daley agreement is permitted to modernize O'Hare, United finally will have the operational flexibility to fully expand competitive service offerings and small community flights as market conditions warrant. Importantly, modernization of O'Hare also is an important part of United's financial recovery plan and critical to our long-term success.

Mr. Chairman, aside from the interest of United and our customers in the modernization of O'Hare, there is a broad array of other stakeholders who are depending on the Ryan-Daley agreement. I would like to take a few moments to briefly mention some of the other stakeholders in H.R. 3497.

First, modernizing and expanding O'Hare is a national economic issue and should be considered to be a national economic priority. One fact that was reinforced in the aftermath of September 11 is that commercial aviation is an economic engine. When our national air transportation system is vibrant and efficient, the United States' economy benefits. When it is not, our economy suffers.

I think few would argue with the fact that O'Hare congestion-related cancellations and delays are not just frustrating and inconvenient, they also negatively impact our economy. It is impossible to place an economic value on the disappointment a parent traveling on business feels when an O'Hare-related congestion problem prevents her from participating in an important family event in Orlando. However, it is possible to quantify some of the many economic costs of congestion delays. For instance, in your hearing last April, the Subcommittee indicated that initial analysis showed delays in 2000 cost the airlines an estimated $6.5 billion, up from $5.4 billion in 1999. A sizeable portion of that amount is attributable to O'Hare. This is just one economic cost of delays, and does not include the cost of missed sales meetings, cancelled appointments, and lost productivity resulting from delays. Passage of the National Aviation Capacity Expansion Act will help eliminate the myriad of national economic losses resulting from O'Hare-related congestion and that clearly is in the best interest of our country.

Second, the Chicagoland regional economy is a very significant stakeholder in passage of this legislation. In fact, swift passage of H.R. 3497 would be tantamount to approving an economic stimulus bill for the United States' economy, with the Chicago area and our entire economic region being the principal beneficiaries. O'Hare is one of the largest employers in the Chicago region with more than 50,000 direct employees and an additional 365,000 jobs that indirectly depend on it. Currently, O'Hare generates more than $37 billion in annual economic impact, including about $10 billion in annual payroll. It has been estimated that modernization would increase O'Hare related employment by nearly 200,000 jobs and increase annual economic benefits by an estimated $16-20 billion. Conversely, it is estimated that failure to modernize O'Hare will deprive Chicago's economy of $8-10 billion annually in economic output by 2015.

Third, consumers are key beneficiaries and stakeholders in the passage of this legislation. In the first phase of the Ryan-Daley plan alone, it is estimated that O'Hare customers will see a 36 percent decrease in overall delays. Additionally, 50 percent of bad weather delays will be eliminated. Moreover, it is estimated that the first phase will bring $171 million in annual passenger delay savings. The consumer benefits of H.R. 3497 are even more dramatic when the projected benefits of the fully implemented Ryan-Daley plan are considered. It is estimated that by its final phase 95 percent of bad weather delays will be eliminated. At the same time, consumers will experience a 79 percent decrease in overall delays and enjoy $380 million in annual passenger delays savings.

Finally, our national air transportation system will benefit greatly if this legislation is passed. Given its importance as a national and international hub, improving and modernizing O'Hare is essential for a safe, efficient and on-time national aviation system. From a national system standpoint, if O'Hare were to remain a congestion choke point, this likely would marginalize any congestion relief progress we make elsewhere in system. Simply put, while solving the O'Hare congestion problem is not a silver bullet for all capacity challenges in our system, it is difficult to imagine any meaningful progress on a system-wide basis if the O'Hare problem is not addressed.

Let me summarize my remarks and conclude them. Congress issued a challenge to the leadership of the State and local governments to end the political gridlock and to craft a realistic blueprint for modernizing O'Hare. Governor Ryan and Mayor Daley rose to the occasion and met that challenge. Now, United Airlines believes it is time for Congress to do its part by passing the National Aviation Capacity Expansion Act to codify their agreement and ensure their vision for putting Chicago aviation back on-course until 2030 becomes a reality. It has been a very long journey for the traveling public to this point. Passage of H.R. 3497 will guarantee there is light at the end of the tunnel.