A Year In Review

January 2, 2014

It has been more than a year since Tom Hendricks assumed the presidency of NATA and brought in the leadership team to assure NATA’s future as a powerful advocate for general aviation in Washington. That has meant not only a change at the top, but also some course corrections which are already making a difference. To understand some of the changes made and some in-the-works under the association’s new management, the Aviation Business Journal conducted a series of wide-ranging interviews with NATA President Tom Hendricks, NATA Board Chairman Michael Scheeringa, Vice Chairman Gary Dempsey and Treasurer Marian Epps.

ABJ: When you became NATA President, what did you perceive to be the state of the organization at the time, and the primary challenges within the association which required your immediate attention?

Hendricks: In preparation for taking the job of NATA President, I did a considerable amount of research on NATA, and found that it had a rich history, and serves a vital function on behalf of the general aviation industry within the United States. What I wanted to do was to build on this. But, in doing that, it also meant building on the relationships NATA had with the aviation regulatory agencies, as well as Capitol Hill. I also looked at NATA’s organizational structure to make sure it could take us to the next level. I examined NATA’s financial foundation, and saw that it had a very strong balance sheet. At the same time, I wanted to see how we could leverage the kind of talent we had recruited. So, I focused on a thorough structural review and planning process after I arrived. From that, our team developed a strategic plan and we aligned all of our activities with that plan—specifically based on a common direction—and a way to measure our success.

ABJ: Can you tell me about the objectives of the strategic plan?

Hendricks: First of all, we defined the mission and values of NATA, and created a vision for what the association was here to do and what we wanted to achieve. Because I want NATA to be focused on our members, I saw our mission as one that would empower them to become the most successful and the safest aviation businesses. For example, we put together new safety initiatives through the Safety 1st Program and the Air Charter Safety Foundation, and we focused on member advocacy through legislative and regulatory agency engagement. We wanted to increase NATA’s presence and profile in Washington, DC, and to review our membership structure. In fact, this is something we are doing right now. We also set out to build NATA into a high-performance organization. To do this, we looked at ways to avoid conflict of interest, developed a new code of ethics, and looked at employment opportunity. We have implemented those initiatives within the organization and have completely rewritten our employee manual to reflect what we are trying to do.

ABJ: What are some of the programs NATA has either implemented or built upon since you became President?

Hendricks: We rolled out the new NATA Workers’ Compensation Insurance Program™ through Beacon Aviation Insurance Services, as well as an Aviation Legal Services program. We also introduced a new NATA Professional Employer Organization (PEO) program which, for a monthly fee, provides a large share of back-office functions. This will enable our members to concentrate more on their expertise, and outsource payroll, accounting, billing and other back office activities, through a partnering arrangement with Oasis Outsourcing, Inc. We have marketed this to our members under the name “NATA People Solutions.” Last year, we added a new aircraft flight coordinator training program, and brought the NATA supervisor training course online. And, at the request of a member, we translated the NATA Professional Line Services Training program into French—making a foreign language version available for the first time.

ABJ: There have been some staff changes since you became President. Can you tell us about that?

Hendricks: Early in my tenure, it was very apparent that Amy Koranda’s talents weren’t being utilized to their fullest, which is why I promoted her to Vice President, Operations, from Director of Safety and Training. Also, I saw a need for someone to work the regulatory agencies—specifically the FAA and the TSA. For that, I hired John McGraw to be Director of Regulatory Affairs. He interfaces with the FAA and TSA, as well as with our state advocacy networks.

ABJ: Has NATA’s approach to working with Congress and the regulatory agencies undergone any changes since you became President?

Hendricks: We are now more engaged with Capitol Hill and the regulatory agencies. Our philosophy today is that we must build long-term, constructive relationships with regulators and legislators, which means taking a positive approach. Wearer being good listeners who are more solution oriented.

ABJ: Have you forged a closer working relationship with the principal aviation advocacy groups in Washington?

Hendricks: Yes. We are interacting more with the leadership of those associations, which has helped to raise NATA’s profile. Across all segments of aviation, we are in agreement on all the big issues, and focus on what we agree upon, not on what we don’t.

ABJ: Over the past year, what legislative or regulatory priorities did you identify on which NATA needed to focus, on behalf of its members?

Hendricks: We worked with other aviation associations to build the House General Aviation Caucus. Currently, 235members of the US House of Representatives have signed onto the General Aviation Caucus. We also spent a lot of time talking about the tax burden on our members, and have worked to ensure that there will never be a $100.00 user fee imposed on general aviation, which has been proposed. The Administration admitted that this additional tax would go toward general deficit reduction rather than improving the aviation infrastructure. Of course, we also worked closely with the IRS to reverse its position on Federal Excise Tax (FET) applications to amounts paid by an aircraft owner to an aircraft management company with respect to that owner’s use of his own aircraft in Part91 operations. The IRS position, we argued, was contrary to several longstanding commercial FET rulings, which said that the FET does not apply to a Part 91 operation carried out by the management company for the aircraft owner. As a result, last May, the IRS suspended potential assessments associated with current ongoing audits of aircraft management companies regarding FET liability, and promised to move forward to issue new guidelines on FET applications to this issue. The other challenge was sequestration, under which 149 contract towers were slated for closure, and the people who manned those towers were going to be furloughed. Last spring, we were able to work with Congress and the FAA to stop that from happening. Now that the new federal fiscal year is upon us, we continue to monitor this situation very closely.

ABJ: The Airline Services Council (ASC) is a component o f NATA. Are any changes anticipated with regard to it?

Hendricks: We want to grow the membership and make sure we are doing as much as possible to advocate for this group. For example, we have worked with the ASC members on TSA issues. Keep in mind, although TSA’s regulatory authority more directly impacts the airlines, it could also impact ASC members, given their support of airline operations.

ABJ: When you became NATA President, how many members did it have? What steps have you taken to increase that number?

Hendricks: Last year, we had approximately 2,000members. We want to grow this significantly in the coming years, and we are making a major effort to do that. In fact, we are seeing a healthy influx of new members. Historically, NATA has been viewed as representing FBOs, charter/management companies, fuel services, flight schools and maintenance repair and overhaul (MRO) organizations. But, in an effort to grow our membership, we have modified the bylaws to establish more membership categories, in order to engage all businesses that operate at airports.

ABJ: Looking ahead, what are the challenges to the general aviation industry you will be confronting in your second year as NATA President?

Hendricks: At the top of this list is the economy which is still tepid. This is why we will be closely watching any proposed legislation and regulations that can financially impact our members. At the same time, we want to do a better job of educating the public about the importance of general aviation to the U.S. economy. Long term, we are working with the FAA on finding an alternative to leaded avgas, and we are definitely looking at ways to expand our Safety 1st program to address safety and performance improvements. In order to underscore the importance of the relationships between airports and airport businesses, we expanded our Board of Directors to include an airport representative. We appointed Clara Bennett, who is Director of the Ft. Lauderdale Executive Airport, because we believe we can leverage her knowledge of the relationships between airport authorities, and others who are engaged in businesses at airports.

ABJ: I understand that NATA is planning to sell its headquarters building in northern Virginia in order to move into Washington, D.C., proper. Can you comment on that?

Hendricks: Yes. We closed on the sale of our headquarters building at the end of October 2013, but will lease the building back for an additional year to give us the time to find a suitable location in Washington, where we can establish a world class meeting and headquarters facility. Prompting this is our belief that we need a stronger presence in Washington; and by having our headquarters in the city, our legislative and regulatory team will be able to interface more efficiently with members of Congress, as well as with the regulatory agencies and their staffs, and the staffs of other aviation associations. We want to make it easier for those people to have access to NATA staff.

ABJ: Anything more you’d like to add?

Hendricks: I’m very positive about our direction and our staff and how we are being perceived in Washington.

Click here to read this ABJ Q4 article in its entirety.