FAAXX702: Traffic Flow Management System (TFMS)
Investment ID: 021-782222331
Overview
Program Title
FAAXX702: Traffic Flow Management System (TFMS)
Description
TFM sustains the operational hardware and software systems of the TFMS hub site and remote sites. TFMS Enhancements add new software capabilities based upon user needs identification and FAA JRC approval. TFMS Sustainment activities maintain the operational software and hardware required to support the TFMS.
Type of Program
Major IT Investments
Multi-Agency Category
Not Applicable
Investment Detail
The FAA prescribes the format and calculations for Benefit Cost (B/C) or Return On Investment (ROI) as part of guidance to programs during investment decision analysis and approval activities, using OMB Circular A-94 as its basis. In 2005, the initial segment of Traffic Flow Management Modernization/CATMT WP 1 calculated a B/C ratio of 1.3 using the standard OMB Circular A-94 techniques and a 7% discount rate (based on benefits not accruing to the government). In 2008, using the same A94 guidance and 7% discount rate for a non-government benefit accrual, TFM calculated its B/C Ratio for TFM CATMT Work Package 2 at 3.41. In 2010, again using A94 and a 7% discount rate, the Benefit/Cost Ratio for TFM CATMT Work Package 3 had a calculated B/C Ratio of 1.06. In these cases, the B/C ratio yielded a significant positive return. The B/C ratio can be interpreted as an ROI. Details of the economic analysis performed for TFM is available in the program's Business Case Analysis Report (BCAR), a standard FAA investment decision document. Neither TFM Infrastructure nor TFMS Sustainment 2 (formerly known as TFM Remote Site Technology Refresh) required a B/C ratio, as the JRC determined those efforts to be an ACAT Level 4 and 5 Technology Refresh, respectively. TFMS Enhancement 4 (formerly known as CATMT WP4) has a FAA JRC approved B/C ratio of 8.41.