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APA Fightline Magazine_ Winter 2005

VIEWS: 10 PAGES: 31

									                                    COMPLACENCY IS NOT AN OPTION
                                    BY CAPTAIN RALPH J. HUNTER, APA PRESIDENT
PRESIDENT’S BRIEFING

                          An oft repeated observation goes something like this: A         in everything that we do as professional pilots. Again, we must
                       professional pilot’s true value is not measured when the           set aside the distractions of the environment, focus on our
                       weather is good and the f light goes as planned. The true          responsibilities, stick to our training, and bring our aircraft,
                       value of professional pilots is measured by their ability to       our passengers, and yes, our company safely home. Make no
                       remain calm and focused in the most daunting of emergencies,       mistake, APA Safety will continue to identify and pursue the
                       to follow their training, and to bring their aircraft and          initiatives that we believe will lead to a safer operation. We
                       passengers safely back to earth. The difficulties we routinely     will continue to press management to make the appropriate
                       face today are no longer just the unexpected events on our         changes to the safety culture of this airline. However, the
                       individual f lights. The threats today also include the many       final responsibility and authority for a safe operation rests
                       storms that have engulfed our individual careers and the           with you and me.
                       pilot profession as a whole. For roughly three years now, our         Each of us needs to conduct an honest and thorough self-
                       profession has been buffeted by one “emergency” after another.     examination. How well do we demonstrate a commitment to
                       Terrorist attacks, an economic downturn, war, excessive            safety to our fellow pilots? Do we find ourselves accepting
                       government taxation and interference, fuel price spikes, and       “close enough” as “good enough?” How prepared are we for
                       cutthroat competition have weighed heavily on all of us. We        each f light? Are we focused on knowing and following
                       are, at times, distracted and frustrated. Nevertheless, as we      well-established procedures the way you historically have?
                       mentally prepare for whatever additional challenges that           Do we operate differently when there is a check airman on
                       2005 holds in store, our mission is largely the same on and        our flight deck? Character is sometimes described as what we
                       off the f light deck - keep our focus, adhere to our training,     do when nobody’s looking. When the f light deck door is
                       and help bring ourselves, our fellow employees, our company,       closed, are we upholding the historically high standards of
                       and our profession safely back to earth.                           the pilot profession?
                          Our future and that of American Airlines remain inextricably       Notwithstanding APA’s strong commitment to safety, we
                       linked. To enjoy the full potential of our careers, American       must also acknowledge that some pilots will find themselves
                       Airlines must survive and prosper. Many of us who had              in the uncomfortable position of defending their actions
                       assumed our careers were safely on autopilot have discovered       when metal gets bent or someone gets injured. In these cases,
                       that the “f light” is not turning out the way we had planned.      APA must also uphold our duty to defend pilots who may be
                       We face complications that we never expected, and we naturally     disciplined for an operational error while at the same time
                       dislike what we cannot control. As a result, many of us are        promoting safety. While seemingly contradictory, I don’t
                       experiencing varying degrees of consternation, resentment, and     believe that one obligation must come at the expense of the
                       even anger at our undeserved and unforecast circumstances.         other. For example, APA recently raised significant objections
                          While there is an understandable desire to fix responsibility   to the Flight Department’s handling of an operational incident.
                       elsewhere in our attempts to deal with adversity, we must not      In this particular case, APA focused on certain premature and
                       be lulled into a belief that we are without the power to control   punitive actions by the Flight Department that we believed
                       our fate. We must always remember the one thing that we,           were largely driven by the appearance of “doing something”
                       and only we, can control: our attention to the details of our      about safety, rather than actually trying to learn something
                       daily operations. Let’s all be brutally honest with ourselves.     that would make American Airlines a safer operation. As this
                       AA’s once industry-leading safety record is now industry-          issue of Flightline goes to press, the Flight Department has
                       trailing in many respects. In addition to the tragedy of lost      responded affirmatively to some of APA’s objections, but we
                       lives and serious injuries, we are quite possibly a single hull    remain at odds on other pieces. Although we’ll disagree at
                       loss from bankruptcy and oblivion. It is easy to blame             times as to the appropriateness or severity of any discipline
                       management, ATC, the government, or even market forces             associated with an incident or accident, APA has a long and
                       that pressure us to operate with lesser margins for safety.        proud history of representing the interests of our pilots and
                       However, only we can stop that increased pressure from             an equally rich tradition of advancing safety in our cockpits and
                       resulting in an accident or incident. We cannot simply wait        line operations. With your continued support, we’ll continue
                       for someone else to fix this problem. We must fix it everyday      to do both!

Flightline                          2                                                                                                      Winter 2004/2005
from the VICE PRESIDENT
                                                          BY FIRST OFFICER SAM BERTLING, APA VICE PRESIDENT




TURMOIL CREATES OPPORTUNITY.                                                                                  As I sit here in
my office in early January and reflect, I want to take a moment and thank you, the membership and wish all of you the
best for 2005. During our first six months in office, the National Officers have attended domicile meetings in almost every
domicile and have been heartened by your response. One question I’ve been asked is what is my biggest frustration
as vice president. My response is the difficulty showing the membership how doing business with management has
changed. At the National Officer level, we see it quite frequently, but at the line pilot level, it is not nearly as evident.
   Unfortunately, change is generally slow to occur, especially if you’re talking about a corporation as big as American
Airlines. Typically, people overestimate what change can happen in a short period of time and underestimate what
change can happen in a long period of time. Since signing the last contract, we have seen the implementation of a
few things showing a different way of doing business. The Multiple Jumpseat agreement, an enhancement to our
Commuter Policy, the TTOT “green light” project and several other small enhancements to our contract. These are
not lightening bolts. They are not restoration of pay rates, recall of furloughed pilots or seat advancement, but they are
tangible improvements to our contract and our quality of life. Does this mean that there is no discord between the
union and management - absolutely not! But we do seem to get things done in a much more productive and less
rancorous fashion. And, so far, it has been a better approach for the membership. To recognize this, you simply have to
ask yourself, “How many of these items would have been accomplished if the old management style was still in place?”
   These incremental changes are important because of the change that is all around us. I had hoped that by now
there would be a more clear view of the future of our industry. But just as things settle down, another hiccup occurs,
creating a dynamic and ambiguous environment. In this turmoil, though, lies opportunity.
   As I said in my first column there is a real chance to shape a better future for the APA and the membership. Grasping
that chance means taking risks and taking action. We must explore ideas and experiment. Asking questions like:
   • Do we need a new reserve system? What does it look like?
   • What is the long-term viability of our pension, what are our options and should we pick any of them?
   • Are there better ways for pilots to control their schedules?
   • What are options for the sub-100 seat aircraft?
   • Should we continually improve the contract or hold everything until Section 6?
   We must explore alternatives because standing still in this environment is not an option and will not lead to the
results we want. If we complacently wait for a cataclysmic event to propel us into action, we will be too late and will
be forced to make distasteful choices. If we are unwilling to engage, we will be left wondering what happened as the
world transforms around us. That is not where we want to be. It is far better to attempt to shape the environment
than react to an environment after it has formed.
   One of the biggest environments to be shaped this year will be in the U.S. Congress. There will surely be activity
in a number of areas near and dear to all of you. We expect that, at a minimum, debate will occur on: mandatory age
60 retirement; pension reform; foreign ownership; and safety and security related issues. The Legislative Affairs
Committee, at the direction of the BOD, is crafting a strategy to work on all of these. Your participation, though, is
vital. You must help shape the environment and debate by:
   • Understanding the issues and the APA’s position and talking points on each of them;
   • Participating in coordinated APA campaigns by contacting your congressional representatives when asked;
   • Contributing to the APA Political Action Committee. Right now, a mere 15% of the pilots participate. If you never
       thought it was worth the $5-$10 a month (that’s 17 to 34 cents a day!) before, take a look at the issues listed
       above and see if you can’t find the return on your investment now.
   This environment will not reward the timid or non-creative. The willingness to explore options and implement
the best ones will help us define the debate and create solutions that best serve each of us. Thanks again for being
involved and informed. As FDR said, “There are many ways of going forward, but only one way of standing still.”

Winter 2004/2005                                                                                                            3    Flightline
                                         BY FIRST OFFICER JIM EATON, APA SECRETARY-TREASURER




                                         “BUT FOR THE GRACE OF GOD”
     S E C R E TA RY-T R E A S U R E R
                                             As I write this column, I am sadly reminded that with the New Year comes additional furloughs. That will

                                         bring the total number of furloughees to 2,778. That’s 2,778 too many.

                                             One of the duties of the Secretary-Treasurer is to be a member of the three-person Furlough Loan Board

                                         of Governors. There are two other pilots on this board with me, Captains Henry Cochran and Bob Garrett.

                                         We are assisted by APA staff member Ms. Jean Little. Our only function is to review loan applications from

                                         furloughed pilots.

                                             I have to say that this is perhaps the most depressing part of being Secretary-Treasurer. Don’t misunderstand.

                                         I enjoy being a participant in a program where pilots are helping pilots. And for those of you who are

                                         contributing to this wonderful program, I thank you for giving me the opportunity to disburse money that

                                         helps people in need.

                                             What gets me down is reading the applications, knowing that these are real people with serious issues, and

                                         but for the grace of God we could all be in their shoes. Our fellow pilots need money for a number of things:

                                         job searches, training, paying mortgages, paying medical bills and recently, recovering from hurricanes.

                                             Let me share with you a couple of recent applicant quotes. “Help pay my mortgage and health insurance for

                                         a year. Savings is almost depleted.” “Purpose of loan is [for] training required for [job certification]. I have a

                                         job offer upon completion. The sooner I receive a loan the sooner I become employed.”

                                             In reviewing applications, one can see how many children a pilot has and how much they are paying for

                                         child-care. A classic trap is where one applicant was paying 20% of gross monthly income for child-care so both

                                         spouses could work. It is also easy to see how some pilots have had to run up credit card debt and then transfer

                                         balances just to keep their monthly payments affordable.

                                             I didn’t start writing this because I planned to ask you for money. I was simply looking for an outlet to vent

                                         after reviewing five or six applications. In the off chance that you do decide to dig a little deeper, thank you,

                                         thank you, thank you.




Flightline                               4                                                                                                  Winter 2004/2005
I N T H I S I S S U E O F FLIGHTLINE   F E AT U R E S

                                               6   GUEST FEATURE: Q&A With Vice Admiral John G. Cotton

                                               8   FEATURE ARTICLE: The “A” Plan: Some Straight Answers
                                                   to Convoluted Issues
                                                                                                              Flightline is the official publication
                                              16   GUEST FEATURE: Aviation Language Proficiency                 of the Allied Pilots Association,
                                                   Standard Promotes Global Safety                                 representing the pilots of
                                                                                                                       American Airlines.

                                                                                                                             National
                                                                                                                   Communications Committee
                                                                                                              Captain Denny Breslin (LAX), Chairman
                                                                                                                   FO Jessica Brightman (BOS)
                                                                                                                    Captain Russ Dennis (MIA)
                                                                                                                      FO Fred Mueller (LGA)
                                                                                                                   Captain Keith O’Leary (SLT)
                                                                                                                  Captain Linda Pauwels (LAX)
                                       C O M M I T T E E S / D E PA R T M E N T S
                                                                                                                      Communications Director
                                                                                                                         Gregg Overman
                                              20   PENSION: The B Plan: Unit Accumulation and
                                                                                                                      Editorial Services Manager
                                                   Lump Sum Distribution
                                                                                                                          Lynne Bowers-Clark

                                              22   AEROMEDICAL: How a Full Body Scan Saved My Life                        Design & Layout
                                                                                                                    Stacey Hull, Graphic Designer
                                              22   AEROMEDICAL: Full Body Scans Have Downside                         Printing Services Manager
                                                                                                                             Bruce Rushing
                                              23   SAFETY: The 2004 Line Operations Safety Audit
                                                                                                                      SUBMIT ARTICLES TO:
                                              24   PILOTS MUTUAL AID: Pilots Helping Pilots                                     Flightline
                                                                                                                      Attn: Lynne Bowers-Clark
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                                              27   TASC: How to Use the SEP Tools: The Conflicted Pick-up              Allied Pilots Association
                                                   and Generic Bid                                                        O’Connell Building
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                                              30   CLASSIFIEDS
                                                                                                            Flightline’s editorial content must be generally
                                                                                                            consistent with Association policies. The guiding
                                              34   BOOK REVIEW: RATTLER by Captain Chuck Gross (ret.)       principle governing all submissions is respect for
                                                                                                            one’s fellow pilots and for the Association.
                                                                                                            Submitted articles should address issues pertinent
                                              34   FINANCIAL MATTERS: Pension factors and stock options     to the Association and its pilots, and must avoid
                                                                                                            references of a personal or political nature.

                                              34   IN MEMORY                                                All articles, including guest editorials, should
                                                                                                            conform with policy positions of the Association, as
                                                                                                            established by the APA National Officers, Board of
                                              35   APA CONTACT INFORMATION                                  Directors, Constitution and Bylaws, and Policy
                                                                                                            Manual. The responsibility for monitoring editorial
                                                                                                            consistency is shared by the National Officers,
                                                                                                            members of the Communications Committee, and
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                                                                                                            final authority over all content.


                                                                                                                    www.alliedpilots.org



Winter 2004/2005                                                                                                            5                    Flightline
                    G U E S T                                            F E A T U R E

             Q&A WITH VICE ADMIRAL
                JOHN G. COTTON
                                                BY GRETEL C. KOVACH, SEPTEMBER 26, 2004
                                         (Reprinted with the permission of The Dallas Morning News)


                                           ‘My friends were murdered.     conflict now has been shortened. We quickly respond to
                                        So I’m doing it for them.’        conflict around the world within 10 days, so you need to
                                        Former American Airlines          be ready to go. But really, the big thing in the Navy is
                                        pilot sets out to make the        we can’t look at each other as stovepipe organizations -
                                        Navy ‘one team’.                  active component, reserve component and all the
                                           Vice Admiral John G.           civilians. The culture needs to be changed everywhere
                                        Cotton, an American Airlines      as “one team.” A reservist isn’t a second-class citizen.
                                        pilot originally from Dallas,
                                        became chief of the Naval            Question: What about the differences in training
                                        Reserve in October. Since         between active duty Navy and the reserves?
             taking the helm, he has pushed for some of the                  Answer: In the future, what we would like to do is
             deepest changes in the Reserve’s history. From his           put all sailors through full boot camp and put all
             base at the Pentagon, Adm. Cotton says he aims to            sailors through full training. The reservists might
             remake the citizen sailors into a leaner, faster force       have a different contract. It might be one year active
             more integrated with Navy operations.                        duty to get through training, then six years in the
                After a recent visit to an officers’ symposium at the     reserves. But we need to think of ourselves as a
             Naval Air Station Joint Reserve Base in Fort Worth,          continuous service.
             Adm. Cotton spoke with Dallas Morning News staff
             writer Gretel C. Kovach about today’s changing                  Question: So are the days of the weekend warrior
             military. Here are excerpts:                                 really over?
                                                                             Answer: They’ve been over a long time. Since
                Question: How did you come to take a four-year            Desert Storm, the reserve components have been so
             leave of absence from your job and eventually                integrated that the number of man-days has
             become chief of the Naval Reserve?                           increased astronomically. Every component has
                Answer: I’m doing this because I really believe we        missions that active duty and reserves do together.
             need to change for the better. We need to transform          We are more “joint” than ever, and that’s where we
             our force as one Navy, not two separate Navy and             need to be in the future.
             Navy Reserve. But more importantly, I was an
             American Airlines pilot, and the events of 9-11                 Question: What will happen to the Fort Worth
             impacted me like every American. I was based in              Joint Reserve base in the next round of military
             Washington, D.C., so the people on that airplane             base closures?
             were my friends. My friends were murdered. So I’m               Answer: Navy planners have decided that VFA-201
             doing it for them.                                           is a very important asset. [VFA-201 is the reserve
                                                                          Hornet squadron that served in the Iraq war.]
               Question: You say the Naval Reserve is going                  It will stay here in Fort Worth, which is a model
             through a period of profound change?                         base. It is what we’re going to have in the future all
               Answer: We’ve looked at every billet, at every unit, at    over the country. It is the best value for the taxpayers’
             every capability in the Navy Reserve to provide better       investment to have multiple services using the same
             war-fighting wholeness. The response time to any             world-class facility. As far as base realignment and




Flightline              6                                                                                                       Winter 2004/2005
                    G U E S T                                          F E A T U R E
             closure, that will depend on the department - and on              Question: A group of area cargo-handling Naval
             the politics. And there is certainly an election coming       reservists left recently to work for the Army in Kuwait.
             up. But in the meantime, we in the Navy, we in the            Are we going to see more of this kind of operation?
             military services, appreciate this great base.                    Answer: Absolutely. They’ll train together before
                                                                           they deploy. And once they get into theater, whether
                 Question: What role are North Texas reservists            it’s delivering mail, or unloading ships, no matter
             playing in the war on terror?                                 what their uniform says, they’re all “us,” they’re all
                 Answer: For every person we have in theater, there        United States. We’re in this together. Because I firmly
             are many others in supporting functions, whether they         believe if we don’t win this away game, it will
             are out at sea or back here in the United States. And         become a home game again.
             I’ll tell you, war has gotten so digitized, that right here
             in the great state of Texas, you have some intelligence          Question: The size of the Navy and Reserves will
             operation centers that can link to other centers all          shrink in 2005. How is that affecting the changes?
             around the country, all around the world. So you                 Answer: We are not downsizing, we are becoming
             have people who are at war right here in Texas.               more effective with the expenditure of the taxpayer
                                                                           dollar. We are looking at our Cold War structure in
                Question: Defense Secretary Donald Rumsfeld                many places and saying “We don’t need that anymore.”
             has asked, “Why have a Reserve if we’re not going             We need to be more agile, more responsive, more
             to use it?” But are we overworking our reservists by          forward deployed. We used about 80 percent of our
             treating them like full-time military?                        equipment in the last three conflicts. And we used
                Answer: We don’t want to have the model of the             maybe 80,000 people to do that. Well, the Chief
             past where we just sat and waited for war. Taxpayers          Navy Officer asks: “What are the other 300,000 people
             want some return on the investment. The Secretary of          doing in the Navy? Now, can we do it with a few less
             Defense has said our reservists should plan on being          people?” We probably can.
             utilized one year out of every six.
                                                                              Question: What is spurring these changes? Is it the
                Question: You have had to juggle your civilian             war on terror, or overdue post-Cold-War adjustments?
             career with military duty. What are we doing to               Or personalities like yourself and Sec. Rumsfeld?
             help these sailors make a similar transition?                    Answer: All of the above. I would say that 9-11 was
                Answer: We want to give them a little bit of warning.      a wake-up call for the country. We are fighting a foe
             We think about 30 days is right. And then once they           we have never seen the likes of. This will be a long
             get into theater, we want to make sure they have the          conflict, like the president says.
             same pay and benefits, a single system for all services.         We have about 140,000 military in Iraq, 40 percent
             We have plans to do that in a couple years. We want           of them Guard or Reserve. I don’t know if that is
             Americans operating jointly, with no second-tier              going to increase or decrease, but they are performing
             reserve system.                                               magnificently.
                                                                              Would we all like to see them come home?
                 Question: Why are Naval reservists often                  Absolutely. Do I think they’re going to be there for a
             deployed for only six months, whereas the                     while? Yes, I do. I think we’re going to help that
             National Guard and Army reserves generally serve              country get back on its feet. And then there are other
             a year or more?                                               places in the world that might demand our attention.
                 Answer: It really depends on the skill set and how        We live in a very interesting world.
             long that skill set is needed in theater. But in the             We have to adapt to this new warfare. It’s terrorism,
             Navy, we have a six-month culture. We have found              the third -ism we have fought in the last century.
             it’s a little less impact on the employer and the family.     We fought and beat fascism. We fought and beat
             And we have to think about them all the time.                 communism. And now for the rest of my life, and
             Especially the family.                                        probably yours too, we will be fighting terrorism.




Winter 2004/2005                                                                                                      7           Flightline
A R T I C L E   THE “A” PLAN: SOME STRAIGHT
                ANSWERS TO CONVOLUTED ISSUES
                            BY CAPTAIN JAMES SOVICH, (BOS) DOMICILE CHAIRMAN



                   Editorial note: The following is based on a letter
                sent to his base by CA Jim Sovich, BOS Domicile                                                                                   November 3, 2004
                Chairman, in November.                                   Fellow Pilots:

                               Let’s be clear, up-front. At this point       The purpose behind my letters to you on this pension has been to:
                            in time, nobody at AMR is talking                     1. Educate, and
                            about A Plan termination or delaying                  2. Start an internal discussion on what we want to do on the pension issues.
                                                                             The information I have provided is based on the most current facts available which
                            required plan payments. AMR did,
                                                                         I ran past our Director of Benefits and ERISA attorney.
                            however, take advantage of Deficit               It is certainly in our best interests that we learn just what all our options are honestly
                            Reduction Contribution (DRC) relief          on this critical benefit. As you will see, when it comes to pension, there is good news
                            afforded them under HR-3108. That,           and there is bad news.
                            in and of itself, should be enough to
                                                                         Good News:
                            raise a red flag.                                An outside consultant reviewed our pension funds in 2002.Based on their estimate
                               Currently, AA is solvent and our A        at that time, we were funded at the PC-3 levels used for all pilot examples in my
                            Plan is arguably much better funded          Pension II letter and the PBGC maximum was still the safety net for PC-4 pilots. Based
                                                                         on the fact that AA has made all their mandatory pension payments since then, it would
                            than that of our colleagues at United,
                                                                         appear that PC-3 PBGC levels remain funded at PC-3 levels. Again, all pilot examples in
                            Delta and US Airways. Just how much          Pension II are viable. As the over-used disclaimer goes, however, past performance is
                            better funded on a Termination Basis,        not necessarily a measure of future growth.
                            we don’t know.                                   The BOS resolution to approach AMR to put in place an ongoing program to establish
                               Many of you have asked some               A Plan funding levels passed unanimously last week. I am confident we can get this
                                                                         done in the very near future and you will be provided the most current information in
                            common questions about the state of
F E A T U R E




                                                                         a usable way.
                            our pension. I hope this letter provides
                            you with some insight, additional            Bad News:
                                                                              The fact that today’s funding levels should be adequate for PC-3 level annuities
                            education, ideas and suggestions. I
                                                                         provides no comfort level concerning future funding, and emphasizes our need to come
                            am certain you have all read with            to some consensus on pension structure.
                            interest what is going on in the                  Legislative attempts to eliminate the lump sum take on an even greater importance,
                            pension arena. It is not possible to         if it was not a critical issue already.
                            overemphasize the importance of                   As pilots, we like constants. Very little in the pension arena is not a variable.
                                                                              By next spring, the fight will be on in Washington, D.C., relevant to pension funding
                            keeping yourselves educated on all           and age 60. I am planning once again to set up a contingent to go to our nation’s Capitol,
                            aspects of pension plans, funding and        as well as setting up a user friendly way to get your views to our local politicians. I have
                            alternative approaches. The following        posted this hypothetical situation to several local politicians already:
                            answers to questions you have posed is            If you view lump sums as bad public policy, what do you think will be the reaction
                                                                         of American Airlines pilots if you passed legislation that eliminated such option on
                            based on the most current information        January 1, 2007? My opinion? Several hundred former senior captains will be home,
                            available and was approved by our            newly retired for Christmas and New Year’s Eve 2006 with their lump sums. Numerous
                            Director of Benefits and ERISA attorney.     B-777, 767, 757 and A-300 aircraft will be parked and many voters will not be able to
                            Many terms used (see definitions box         travel home for the holidays.
                                                                              Not surprisingly, the common response to date has been, “We hadn’t thought of that.”
                            on next page) will be the same and
                                                                              As APA members, we have a lot of work to do in 2005. If you don’t give at least
                            hopefully provide ease of reading.           $5 per month to the APA PAC, please start today. Call APA at 1.800.323.1470 and sign
                                                                         up or send in the card found in the next issue of Flightline. Too many bad decisions are
                            Q1. Does a company have to be in             being made in Washington due to bad information. Let’s at least educate lawmakers so
                                                                         that if they make bad decisions, they do so fully informed.
                            bankruptcy to terminate a pension plan?
                            A1. No. The plan can be terminated by:       Fly Safe!
                               • Voluntary Standard Termination.         CA Jim Sovich, (BOS) Domicile Chairman
                                 The plan must be funded to

Flightline                  8                                                                                                                         Winter 2004/2005
       cover plan liabilities. (In effect, funded at                 is the date that a Plan participant can retire with no
       termination level. This is actually the most                  early retirement reduction. Thus, if the FAA retirement
       common way it’s done, but you never hear                      age changed, a pilot could still retire at age 60 with
       about these!)                                                 no early retirement penalties under the A Plan. Pilots
    • Distress Termination by the Company. The plan                  who continued to work would still continue to earn
       is not sufficiently funded to cover liabilities.              benefits under the A and B Plans since the IRS Code
    • Involuntary Termination1. The PBGC views                       prohibits a plan from ceasing either accruals (in the
       continued administration by the plan provider                 case of the A Plan) or contributions (in the case of
       as posing an increasing risk to the PBGC and                  the B Plan) based on attainment of a specified age.
       forcefully takes over. (Rarely done.)                         Thus if you continued to fly under a new FAA age
   According to PBGC published reports, a total of                   limit, you would continue to earn a pension benefit.
1,271 plans were terminated and submitted to the                     (However, you should carefully consider the value of
PBGC during 2003. Of these, 1,119 were voluntary                     the lump sum at age 60 compared to the additional
standard terminations and only 152 were distress                     accruals beyond age 60. In many cases, a pilot would
terminations or involuntary terminations.                            receive a higher present value in his A Plan lump sum
   The PBGC guarantees the benefits of qualified DB                  by retiring at age 60 compared to working to a later
plans only, and generally does not seek to take over                 retirement age.)               (continued on next page)
a pension plan. PBGC is on the financial hook if the
plan is a DB plan qualified under ERISA. In the case                                       DEFINITIONS
of United Airlines, the PBGC is fighting United in
court to keep from taking over the DB plan as a                          DB Plan – Defined Benefit Plan (A Plan)
Distress Termination.                                                    DC Plan – Defined Contribution Plan [B Plan or 401(k)]
   In the case of US Airways, the PBGC participated                      PBGC – Pension Benefit Guaranty Corporation
in the court proceedings to take over the pilots’ DB
                                                                         Qualified Plan – Complies with ERISA rules for
plan as a Distress Termination.
                                                                         preferential tax treatment
   It is also possible, hypothetically, for a plan spon-
sor to subsequently take back control of a terminated                    DRC – Deficit reduction contributions; additional catch-up
                                                                         contributions required by law from plan sponsors
plan that has been turned over to the PBGC under
certain conditions or get approval to initiate a new                     HR 3108 – House Bill adopted last year providing
                                                                         funding relief
qualified plan. This occurred at US Airways, which
now is threatening a 30% reduction to its new pilot                      CLB – Current Liability Basis
DC Plan through court action.                                            TB – Termination Basis
                                                                         FASB (pronounced Fasbee) – Financial Accounting
Q2. Does a company in bankruptcy always terminate                        Standard Board
its pension plans?
                                                                         IRC 401(k) / IRC 415 – Separate Sections of the Internal
A2. No. As mentioned with United, the PBGC is                            Revenue Code
fighting termination. In the case of TWA’s first BK in
                                                                         PC 6/5/4/3/2/1 – Priority category grades used by the
1991, and again in 1994, changes were made, accruals                     PBGC to determine guaranteed benefit levels
frozen, and DC contributions actually increased on a
                                                                         ERISA – The Employee Retirement Income Security Act
percentage of salary basis. However, TWA remained
                                                                         of 1974, as amended
plan sponsor and continued to maintain the frozen
TWA DB Plans. It was not until January 2001--almost                      Section 1113 Filing – Section of the Bankruptcy code
                                                                         companies or creditors use to get a court to set aside labor
10 years after their first BK--that TWA sought to
                                                                         agreement
terminate the plan.
                                                                         FAE – Final Average Earnings
Q3. If Age 60 changes, how does that impact our pension?                 LOS – Length of Service
A3. The pension plan document specifically defines                       BK – Bankruptcy
the Normal Retirement Date (NRD) as Age 60. NRD
1
  The provider of a DB plan qualified under ERISA currently contributes an insurance premium to the PBGC equal to (1) plus (2)
where: (1) $19/year for each plan participant and (2) a variable-rate premium equal to $9 for every $1,000 of unfunded vested
liability as of the end of the prior plan year. This was intended to provide the necessary funding to cover plans that terminated and
were not adequately funded. This has proven to be grossly inadequate to provide such funding.

Winter 2004/2005                                                                                                                    9   Flightline
A R T I C L E
                Q4. What does a Qualified Plan mean to me?                 “something” is calculated using our A Plan formula
                A4. ERISA was put in place to protect certain workers’     in the plan document modified by the PBGC, as
                benefits. Pension is the largest piece of the act. The     explained later, or by using the minimum benefit
                PBGC was established by ERISA to ensure the                calculation contained in our plan document,
                benefits provided by qualified DB Plans. In addition,      whichever is greater. Only in the case where that
                PBGC acts somewhat as a funding and solvency               “something” has a net present value of less than
                watchdog. If a pension plan qualifies under ERISA, it      $5,000 at the point of plan termination will the PBGC
                allows the plan sponsor to fund it with pre-tax            cash you out with a lump sum. No other lump sums will
                dollars and ensures the monies placed in trust for         be paid, period. Here’s a slightly more technical answer:
                participants are tax exempt until retirement. It also         The amount that you would receive would
                means those trusts cannot be attached by creditors in      depend upon:
                a BK proceeding.                                              • TB funding level at the time of plan termination,
                   A Qualified Plan provides other protections as well.       • PBGC maximum guaranteed benefit at that time,
                Notably, a Qualified Plan ensures accrued benefits            • Date that you start your pension benefit payments,
                could not be cut retroactively, absent new legislation.       • Your accrued benefit at that time, and
                (Last year, APA successfully fought legislation that          • Whether you are PC-3 or PC-4.
                attempted to change lump sum calculations. Our                The 2004 maximum is $28,851/year for a 60 year-
                membership support was critical especially to              old and $44,386/year for a 65 year-old. If you retire
                Senator Judd Gregg, who chairs the Senate committee        before age 60, the amount would be actuarially
                which oversees pensions.)                                  reduced further. Here are a few examples:
                   In 1996, we bargained changes to the pension
                                                                             Active Pilot A - 28 years old with five years LOS
                plan to ensure all our retirement money remained in
                                                                           and FAE of $60,000/year for those five years at point
                a Qualified Plan in response to a legislative change
                                                                           of termination would get the following benefit
                made to the IRC. We were proactive, and successful,        based on our A Plan’s Minimum Benefit Formula:
                by design and effort.
                                                                              A Plan Benefit under Minimum Formula
                   United has limited success using a different
                                                                                           for Accrued Benefit
                approach. They sought to maintain the same level of            (This is Independent of the Standard Formula
                benefits owed them by maintaining their Qualified                LOS-1x1.25% x FAE - the plan compares
F E A T U R E




                DB plan, status quo, and instituted a new Non-                     the two and pays whichever is greater)
                Qualified top-hat plan to make up the penalty the             LOS-1 x $1,500 A Plan’s Minimum Benefit
                IRC change would have imposed. The PBGC has no                          5-1 x $1,500 = $6,000/year
                responsibility to consider the top-hat portion of the
                                                                             $6,000/year would be the annuity benefit
                benefit owed to current or future United retirees if       owed at age 60 for life since it is well above the
                United walks away from their plans.                        benefit accrued under the standard formula.

                Q5. What if AA walks away from their plans?                  The PBGC will run a net present value (NPV)
                A5. Your contract currently prevents this absent Section   function on that money stream starting at 32 years
                1113 Filing (see definition on page 9) under the BK        hence to determine if it exceeds $5,000 NPV. If it
                processes or an Involuntary Termination by the PBGC.       does not, they clear the pilot off the books with a
                                                                           lump sum. If it does, that pilot is entitled to
                Q6. What would happen to me if our A Plan is ever          $6,000/year beginning at 60.
                turned over to the PBGC?                                     This pilot was in PBGC category PC-4. Everyone
                A6. We know what the procedures would be. We               that has at least five years is in PC-3 or PC-4 and,
                know what the rules would be that would govern             depending on funding, could receive additional
                PBGC’s calculation of your benefit. We don’t know,         benefit as PC-5 or PC-6.
                however, exactly what your benefit would be. But we
                can get you in the ballpark by telling you about the       Q7. What are PC-3, PC-4, PC-5 and PC-6?
                PBGC’s minimums and maximums. Here is how it               A7. The PBGC places Plan participants and their
                works in a nutshell:                                       benefits into priority categories (PC) when they take
                   PBGC minimum – if you are vested (this is date of       over a plan. If you are vested (date of hire plus at least
                hire plus five years) you are owed something. That         five years), you would be at least in category PC-4. Once

Flightline      10                                                                                                   Winter 2004/2005
all employees are prioritized and a modified, accrued                   group benefit will be determined. Every vested pilot
PBGC benefit computed, they then look at the funding                    not in category PC-3 will receive a PC-4 benefit.
to determine if it is sufficient to pay that modified,                     The same formula (LOS-1 x 1.25% x FAE) is used to
accrued benefit. The PGBC does this in stages.                          calculate the accrued benefit except for those who are
                                                                        actually owed more through the minimum benefit
Q8. How does the PBGC compute a modified benefit?                       (like our 28 year-old - Pilot A).
A8. First, the PBGC determines if PC-3 levels are                          In the case of PC-4, however, there is no three-year
reached. (We are starting with PC-3 since Categories                    look-back in LOS or correction for FAE. For this
PC-1 and PC-2 are not applicable to the A Plan                          entire group, the benefit under PC-4 at age 60 would
because they cover employee contributions and there                     be the lesser of your accrued benefit at point of
are no employee contributions to the A Plan.) For                       termination or the PBGC maximum. (If your full A
our purposes, pilots currently retired or those 53                      Plan benefit would have been more than the PBGC
years of age or older who have at least 13 years of                     maximum, that amount over the maximum could be
service would be entitled to PC-3 benefits. Since the                   paid as a PC-5 benefit, if there is enough money in
vast majority of our retired pilots took the A Plan as                  our A Plan when it terminates.)
a lump sum, we will move on to a discussion of how
this will affect active pilots. Appendix C (see page 15)                                            Active Pilot C - 50 years old with 21
contains examples of the effect on retirees.                                                      years of service and $140,000/year FAE at
   The other group, besides retirees, included in PC-3                                            the point of plan termination.
are those 53 and older with at least 13 years LOS who
are still flying. The PBGC would compute the benefit                                                      Accrued Contract Benefit
with a three-year look-back as if they had actually                                                     21-1 = 20 x 1.25% x $140,000
retired at that point in time and taken an annuity 2.                                                         = 25% x $140,000
                                                                                                       = $35,000/year accrued benefit
      Active Pilot B - 55 years old with 24 years of service and
    $160,000/year FAE at the point of plan termination whose FAE was
                                                                                                    At age 60, Pilots C will be owed:
    $140,000 three years before plan termination.
                                                                                                  • The minimum payment for this
           Contract Benefit                             PBGC PC-3 Benefit                           PC-4 pilot will be the PBGC
     24-1 = 23 x 1.25% x $160,000                  21-1 = 20 x 1.25% x $140,000                     maximum, currently $28,851/year;
         = 28.75% X $160,000                             = 25% x $140,000                         • The maximum payment will be
     = $46,000/year accrued benefit                 = $35,000/year PC-3 benefit                     $35,000/year if funded at full
                                                                                                    termination level.
      At age 60, Pilot B will be owed:
    • The PBGC modified benefit would be $35,000/year;
    • The maximum payment would be $46,000/year starting at age 60 if                          Most of our older pilots are
      the plan was fully funded at termination level.                                       also more senior. If the A Plan is
    • If the plan is not well enough funded to fully pay all benefits at the                funded well enough to pay all
      PC-3 level, then the benefits will be pro-rated based on the available                PC-3 benefits, they will get an
      assets, but Pilot B will always be entitled to at least the PC-4                      accrued benefit above the PBGC
      guaranteed amount, which is discussed below.                                          maximum, even after the PBGC
                                                                                            adjustment (Pilot B). If the A Plan
  If necessary, all our A Plan’s assets can be                          is not well funded enough to pay all PC-3 benefits,
exhausted on PC-3 before any PC-4 individual is                         the amount of funds available will first be used to
considered. However, the funds will not be used to                      pay as much of the PC-3 benefit as possible, even if
pay above their PC-3 benefit unless there are more                      that depletes all the Plan’s assets. The PBGC is still
than enough assets from our A Plan to let PBGC pay                      responsible for paying the PC-4 benefits, even if
out more than PC-3 and PC-4 benefits.                                   there are not any Plan assets left. If the Plan is not
                                                                        well enough funded to pay all PC-3 benefits, the
The PC-4 category                                                       PC-3 pilots will get their pro-rata share of their PC-3
  After the PC-3 benefits are calculated, the PC-4                      benefits. (continued on next page)
2
    No early retirement penalty occurs unless the pilot starts his payout prior to age 60. See Appendix B for that factor.


Winter 2004/2005                                                                                                                11            Flightline
A R T I C L E
                                  For example, if the A Plan has enough assets to pay
                                                                                                                         APPENDIX A
                               90% of PC-3 benefits, the PC-3 group will each
                               receive 90% of his or her PC-3 amount. The PBGC                             PBGC Maximum Payouts
                               maximum is the backstop PC-3 benefit even if there
                                                                                                  2004 Reduction           Maximum        Maximum
                               are virtually no funds available. The pilots most at
                                                                                                   Age       Factor       Guaranteed     Guaranteed
                               risk are those less than 53 with more than 13 years
                                                                                                                         Annual Benefit Monthly Benefit
                               LOS since they indeed would be capped at the PBGC
                               maximum unless funding exceeded PC-3 levels                          70        1.66        $73,681.29          $6,140.11
                               regardless of their accrued benefit. Everyone would
                                                                                                   69         1.49        $66,135.62          $5,511.30
                               lose the lump sum if the A Plan terminates.
                                  If your accrued benefit was less than the PBGC                   68         1.34        $59,477.67          $4,956.47
                               maximum, you are owed that lower benefit at age 60                  67         1.21        $53,707.45          $4,475.62
                               from the PBGC as a PC-4 benefit.
                                                                                                   66          1.1        $48,824.95          $4,068.75
                                  If a pilot elects to take a payout before his 60th
                               birthday, his payout will be reduced by:                            65           1         $44,386.32          $3,698.86
                                  • The dollar value shown in Appendix A (see right)               64         0.93        $41,279.28          $3,439.94
                                     shows the amount owed if the PBGC maximum
                                                                                                   63         0.86        $38,172.24          $3,181.02
                                     is reached.
                                  • The accrued benefit actuarially reduced for                    62         0.79        $35,065.19          $2,922.10
                                     starting payments before age 60 (see below).                   61        0.72        $31,958.15          $2,663.18
                                  The reduction factors shown in Appendix B are the
                                                                                                   60         0.65        $28,851.11          $2,404.26
                               A Plan’s early retirement reduction factors. They are
                               also actuarial reductions so the PBGC reductions                    59         0.61        $27,075.66          $2,256.30
                               table should be pretty close to those factors.                      58         0.57        $25,300.20          $2,108.35
                                  Similar to Social Security, if you are owed the
                                                                                                   57         0.53        $23,524.75          $1,960.40
                               PBGC maximum and elect to defer payment beyond
                               age 60, your payment would be based on the age                      56         0.49        $21,749.30          $1,812.44
                               you begin taking the benefit.                                       55         0.45        $19,973.84          $1,664.49
F E A T U R E




                                                                                                   54         0.43        $19,086.12          $1,590.51
                               Example
                                  If the plan were terminated today (locks in PBGC                 53         0.41        $18,198.39          $1,516.53
                               maximum of $28,851 at age 60 and $44,386 age 65),                   52         0.39        $17,310.66          $1,442.56
                               and if were you owed the PBGC maximum only and
                                                                                                    51        0.37        $16,422.94          $1,368.58
                               took no action initiating payment until age 65, you
                               would be owed $44,386/year at that point, even                      50         0.35        $15,535.21          $1,294.60
                               though you were younger than 60 at plan termination.                         Applied if your accrued benefit is equal to or
                               If you elected to start payments earlier than age 60,                     greater than PBGC maximum and you elect early
                               the PBGC maximum annuity is likewise reduced.                                         or late initiation of payout.
                               (Appendix A)

                 Early Retirement Reduction Factor per A Plan Defined Benefit Plan Document
                             59     .9165    .9235     .9304     .9374       .944      .9513    .9583       .9652     .9722      .9791     .9861     .9930
                             58     .8418    .8480     .8542     .8604      .8667     .8729     .8791       .8854     .8916      .8978     .9041     .9103
                             57     .7746    .7802     .7858     .7914      .7970     .8026     .8082       .8138     .8194      .8250     .8306     .8362
                             56     .7142    .7192     .7243     .7293      .7344     .7394     .7444       .7495     .7545      .7595     .7646     .7696
                APPENDIX B




                             55     .6596    .6642     .6687     .6733      .6778     .6824     .6869       .6915     .6960      .7006     .7051     .7097
                             54     .6102    .6144     .6185     .6226      .6267     .6308     .6349       .6391     .6432      .6473     .6514     .6555
                             53     .5654    .5692     .5729     .5766      .5804     .5841     .5878       .5916     .5953      .5990     .6028     .6065
                             52     .5247    .5281     .5315     .5349      .5383     .5417     .5450       .5484     .5518      .5552     .5586     .5620
                             51     .4875    .4906     .4937     .4968      .4999     .5030     .5061       .5092     .5123      .5154     .5185     .5216
                             50     .4537    .4564     .4592     .4621      .4649     .4677     .4706       .4734     .4762      .4790     .4819     .4847
                             Applies if your accrued benefit is less than the PBGC maximum at point of termination and you elect early payout (retirement).


Flightline                     12                                                                                                               Winter 2004/2005
PC-5 Category                                                maximum if the accrued benefit is above it. The PC-4
   If the funding of the plan is greater than that           reservoir is always filled to the PBGC maximum
needed to bring all participants up to their PC-3 and        guaranteed benefit if the accrued benefit is equal to
PC-4 benefits, calculations are then made of the             or greater than it.
benefits that would have been considered “non-                  If there is extra fluid (money) available, you call
forfeitable” had they been paid by the A Plan without        out the truck which continues to pump in the fluid
a termination.                                               until PC-3 and then PC-4 are 100% full (accrued
   “Non-forfeitable” is defined as benefits for which        benefit under the A Plan). If there is still some fluid
you have met all the entitlement conditions. For             left, it can fill up the auxiliary tank (PC-5 and
example, remember that $11,000 that was cut off              unvested PC-6 pilot) - [Full Termination Funding].
Pilot B’s annuity because of the three-year look-back?       The individual’s level could only be lower if it is real
That money would be thrown into the PC-5 bucket.             cold outside (early retirement reduced benefit per
Was your PC-4 benefit a cutback from the benefit             Appendix A).
you would otherwise have received like Pilot C? The             At this point in time, we do not know, on a
difference between what you would have received              termination basis, how well our A Plan is funded and
from the A Plan and what you received as a PC-4              there is no federal requirement to report it.
benefit is also a PC-5 amount. All of the PC-5                  NOTE: The point of Plan Termination is important
amounts are totaled. If there is not enough money to         because all calculations start there and the PBGC
pay all of the PC-5 amounts, here are the priorities:        maximum is indexed for inflation. Your maximum
   1. Amounts that were cut because of the PC-3’s            benefit is frozen at the point of termination. TWA
      three-year look-back are paid first (and pro           went from 1991 to 2001 and was entering its third BK
      rata, if there isn’t enough to pay all of them);       before the plan was terminated! The 2001 PBGC
   2. Amounts cut back to the retirees (again,               maximum number was therefore the limiting benefit,
      pro rata if there isn’t enough money to pay            and much, much higher than what was in place in 1991.
      them all).
                                                             How do we start to determine how well funded we are?
PC-6 Category                                                STEP I : Determine where we are now.
   PC-6 benefits are paid if enough assets exist to allow       Federal law requires AMR to file a Form 5500
all pilots to collect all of their actual accrued benefits   every year. Schedule B of that form provides the
owed under the plan at point of termination. PC-6            information on the funded status of the A Plan on a
benefits are those that were “forfeitable” under the A       current liability basis, but not on a termination basis.
Plan’s normal rules. A good example is a pilot with
less than five years of service. That pilot would not        STEP II: Determine what AA can do to make us
have vested in any benefit under the A Plan, but if          more secure.
there are assets left over after all the “non-forfeitable”      Obviously, if our A Plan was fully funded on a
benefits have been paid, that non-vested pilot would         termination basis, every penny owed to us would be
receive some pension payment.                                there every day. It is NOT there. Almost nobody funds
   If all of that can be paid, the termination would         like that, and AA does not have the cash to fund it like
have been a standard termination under which all of          that even if they were so inclined. There are several
the plan’s obligations as of date-of-termination are         legal issues governing pension plan funding that
satisfied and all benefits to which participants are         need to change in order to allow (better yet, require)
entitled at date-of-termination would be paid. If the        plan sponsors to increase their contributions during
incredible occurs and there is still money left, it          the good times, and not put additional financial
reverts to the plan sponsor.                                 burdens on them during the bad times.

A Primer on PC-3/4/5/6 For Pilots                            STEP III: Determine what can we do.
   I like to view PC-3 and PC-4 as reservoirs with              We should get AA to sit down with us. It is in their
stand pipes that fill other reservoirs, which also have      interest to prevent a run on early retirements due to
one-way, check valves. The minimum level for                 concerns about the A Plan in the future as you see
dispatch has the PC-3 reservoir filled at least as far as    happening at Delta today. They cannot afford to have
the plan’s assets will fill it, at or above, the PBGC        200 777 Captains retire in December, or January, or

Winter 2004/2005                                                                                                  13    Flightline
A R T I C L E
                February, etc. We should also seek through lobbying          WHEREAS, a reduction in risk to pension security may
                efforts the changes cited in Step II above, as well as    be in the best interest of all our pilots; therefore
                lobbying to raise the IRS 415 limits.                        BE IT RESOLVED, that the APA Board of Directors
                                                                          directs the APA National Officers and APA Pension
                Revisit our pension philosophy.                           Committee to approach AMR with the specific intention
                   Our B Plan has been viewed as your equity              of discovering the current A Fund funding on a termination
                portfolio and our A Plan as your bond portfolio. In       basis, and securing an agreement on access to such data
                fact, most B Plan money managers invest mainly in         in the future.
                equities and the A Plan lump sum acts like a bond            BE IT FURTHER RESOLVED, that the APA Pension
                fund, (i.e., interest rate sensitive, pays a fixed        Committee develop and assess alternative approaches
                amount, responds to the vagaries of the markets,          towards pension preservation that maintain AMR’s
                etc.). This might make sense if we were certain all       obligation while decreasing the AA pilots risk.
                funding levels would be sufficient at retirement.            BE IT FURTHER RESOLVED, that a report be
                   I remember growing up in the 1950s and ‘60s.           provided by the APA Pension Committee, and presented at
                If anyone had suggested that Bethlehem Steel,             the Winter Board of Directors meeting.
                Pan American Airways or American Motors would
                ever go out of business, they would have been             Stay informed.
                accused of having too many Blatz beers. My first car         Ask yourself again these questions:
                in high school was a 1959 Studebaker Lark. It was            Are you convinced AA is as solvent today as the
                unthinkable to believe these companies could              day you were hired?
                simply go away. Corporations like that had the               Are you convinced your A Plan will be there as
                money to take care of you, cradle to grave, and the       surely as you were the day you were hired?
                labor unions would make sure it happened.                    Do you want your Union to look into alternative
                   Deregulation and low cost carriers hit us along with   approaches?
                high foreign oil and no shortage of corporate raiders        As your Chairman, I view it as due diligence to
                masquerading as managers. Creative accounting and         ensure you remain fully informed concerning all
                government approved under-funding exacerbated             aspects of this vital benefit program. We should all
F E A T U R E




                the problem. Defined benefit plans that we now are        plan on being retired for a long, long time. It is up to
                concerned about as risky were once as sound as the        your union to do all we can to ensure you have the
                U.S. dollar. Thus far, the government answer has not      financial security to enjoy it!
                been to fix the under-funding, but rather reduce the
                obligation so that funding now appears adequate.                    Endorsed by
                                                                                    the APA Pension
                                                                                    Committee
                Resolution mitigates risk.
                   At this point in time, there has been no talk of
                terminating the A Plan, but there is no really current
                information on how well it is funded if it were
                terminated. My intent has been to initiate discussion,
                debate, and study of the pension problems facing us
                while it is not a crisis, and we do not have the
                antagonistic backdrop of Section VI negotiations. It
                remains my view that this problem will not go away
                and mitigating risk is possible and may be desirable.
                I plan on bringing the following resolution to the
                Fall Board of Directors meeting on behalf of all
                Boston pilots. [ The resolution passed 17:1]
                   WHEREAS, Defined Benefit Plans are currently under
                funded throughout corporate America; and
                   WHEREAS, many of our colleagues have their plans
                under assault by their respective managements; and

Flightline      14                                                                                                  Winter 2004/2005
                                                  APPENDIX C
      Retirees who took the A Plan as an annuity and have been retired more than three years would only
   have that annuity adjusted if the annuity had been improved by contract and the benefit increased in the
   last five years. In our case, pilots received credit for furlough in their LOS as a result of the TWA agreement
   in 2001. In this hypothetical situation, such retired pilots would not get that part of their annuity as a
   PC-3 benefit (although they might get it as a PC-5 benefit; see explanation of PC-5).

       E.G. Pilot D - retired with 29 years of service four years ago including four years credit for furlough,
     $200,000/year FAE and took an annuity for the A Plan. A Plan benefit computation = LOS-1 x 1.25% x FAE.

                     Contract Benefit                   PC-3 Benefit (Excludes 4 yrs. Furlough)
               29-1 = 28 x 1.25% x $200,000                   25-1 = 24 x 1.25 x $200,000
                     = 35% X $200,000                              = 30% x $200,000
               = $70,000/year accrued benefit                 = $60,000/year PC-3 benefit

        The retiree’s annuity would be reduced $10,000/year. (That $10,000 might be paid as a PC-5 benefit,
     assuming our A Plan’s assets are sufficient to cover all PC-3 benefits, and depending on whether the
     Plan had enough assets to pay any PC-5 benefits, as discussed earlier.) Retirees who took the A Plan
     as an annuity, who have been retired less than three years, will be subject both to reduction for this
     contract improvement (if applicable) and will all have their annuities recalculated with a reduction
     of three years to their LOS regardless of any other adjustment. (Very few pilots have elected an annuity
     since the lump sum physical for the A Plan was removed through successful negotiations.)


        E.G. Pilot E - two years ago and had the same career path as pilot D.
               Contract                    PC-3 Benefit (Adjusted            PC-3 Benefit (Adjusted for
                Benefit                     for Furlough Only)             Furlough and <3 Yr. Retirement
     29-1 = 28 x 1.25% x $200,000        25-1 = 24 x 1.25 x $200,000         22-1=21x1.25% x $200,000
           = 35% X $200,000                   = 30% x $200,000                  = 26.25% x $200,000
     = $70,000/year accrued benefit      = $60,000/year PC-3 benefit         = $52,500/year PC-3 benefit


     Assuming our A Plan’s assets are sufficient to pay all PC-3 benefits.
     • The minimum payment for Pilot D would be $60,000/year; if the plan isn’t sufficiently funded to
       pay all PC-3 benefits, Pilot D would get his pro-rata share of the plan’s assets, but not less than
       the PC-4 amount;
     • The minimum payment for Pilot E would be $52,500/year; if the plan isn’t sufficiently funded to
       pay all PC-3 benefits, Pilot E would get his pro-rata share of the plan’s assets, but not less than
       the PC-4 amount;
     • The maximum for both pilots would be their total accrued benefit of $70,000, but that totally
       depends on how well the plan was funded on a termination basis.




Winter 2004/2005                                                                                                     15   Flightline
                                             Guest Feature
           Aviation Language Proficiency
         Standard Promotes Global Safety
                                              By Marjo Mitsutomi Ph.D., University of Redlands

                Many pilots and air traffic controllers on interna-         language of world-wide aviation, but it was never a
             tional routes know that communication and mutual               mandated expectation. Consequently, international
             understanding can often be a challenge. Although               crews would be faced with situations where their
             crews all over the world have been trained to use the          counterparts might be able to communicate with them
             International Civil Aviation Organization (ICAO)               in the same language; it was never a given, however.
             phraseology in their radiotelephony communications,            The above recommended practice was modified last
             misunderstandings occur routinely. With almost two             year when ICAO adopted annex amendments which
             billion of the world’s people using English to some            require an English language proficiency minimum
             degree daily, it is not surprising to encounter many           for flight crews and air traffic controllers working
             different sounding varieties of the language. Stories          international flights.
             and anecdotes regarding communication problems                    Inadequate language proficiency has been ruled to
             abound especially among those whose duties lead                be the cause of some major high profile accidents as
             them into international aviation contexts across               well as numerous other incidents and near-misses.
             national and linguistic boundaries.                            The ICAO Journal edition of January/February 2004
                To facilitate efficient air-to-air and air-to-ground        reports that in one member State’s review, 70 percent
             communication, ICAO many decades ago developed                 of the problems in 28,000 cases involved some
             an impressively large repertoire of prescribed radio-          aspect of communication. The same Journal also
             telephony phrases (also known as ATC phraseology).             states that between 1976 and 2000, language played
             These phrases were coded to be used for routine                a critical role in accidents which resulted in 1,100
             procedures and some predictable emergencies. They              passengers and crew losing their lives.
             were designed to make the communicative function                  Although most flight operations go according to
             between the ground and aircraft as concise and brief           plan, there are times when things go wrong.
             as possible. The beauty of ATC communication is                Communication problems are implicated in three
             that all parties know what is expected of them in              well known airline accidents. In one of the worst
             terms of their performance-related procedures, both            aviation disasters ever, KLM Flight 4805 in 1977
             technical and linguistic.                                      crashed into a Pan Am plane on the same runway
                Even with all pilots and air traffic controllers adhering   due to a Spanish controller and a Dutch pilot failing
             to this phraseology, situations arise that cannot be           to communicate critical information. In 1990 Avianca
             handled within the context of the phraseology. In              Airlines Flight 052 crash was ruled to have been caused
             unexpected cases crews must resort to the use of               by the flight crew being unable to communicate the
             “plain” or “general” language to establish mutual              seriousness of their fuel emergency to air traffic
             understanding. When pilots and controllers share               control. In the case of the 1995 American Airlines
             the same language, they may communicate with each              Flight 965 to Cali, the Spanish-speaking air traffic
             other in their native language. However, when the              controller was not able to properly communicate to
             language of the ground station is not shared by the            the English-speaking crew that their position seemed
             airmen in question, potential problems arise.                  to be seriously off course.
                Until March of 2003, English was the recommended               Recognizing the significant role that language




Flightline               16                                                                                                     Winter 2004/2005
                                           Guest Feature
            plays in flight operations, the ICAO Air Navigation             is used solely for communication purposes in the
            commission in 1997 mandated a thorough and                   aviation context. It is, therefore, just another tool -
            detailed review of the provisions dealing with               albeit a very critical one - to “get the job done.”
            all voice communications. The Proficiency                       What marks speakers at the Operational Level is
            Requirements in Common English (PRICE) Study                 their ability to think in the target language. They can
            Group, an international group consisting of aviation         manipulate the language purposefully so that they
            and language experts, was formed and commissioned            can deliver their desired message in an original way.
            in 2000 to review the existing provisions and to             Speakers at this level are not restricted to a memorized
            identify the deficiencies and shortcomings of the            set of phrases or sentences but are free to create with
            current system.                                              the language to satisfy the communicative needs of
                During the review process, the experts turned their      the moment. In other words, pilots and air traffic
            attention to language competency itself. The team            controllers at the Operational Level are able to
            recognized that when there is no prescribed ATC              converse spontaneously with one another; they can
            script for a new set of circumstances, airmen must           “talk through” the situation at hand outside of the
            possess sufficient verbal skill to address the emerging      confines of the ATC phraseology. And, that can
            situation quickly, accurately, and precisely. This calls     bridge the difference between life and death.
            for competency in the home language of the station,             To the casual observer it may seem that nonnative
            which can still be used when it is understood by all         speakers of English will be the most affected by
            the crews in question. In addition, the PRICE team           the implementation of the ICAO standard.
            concluded that all airmen – regardless of their native       Communication, however, is a two-way street; the
            language – must possess basic conversational ability         message is negotiated between the one who sends it
            in English, which is to be available as the common           and the one who receives it. The burden of successful
            language of the international sky. The purpose of this       communication is placed on native and nonnative
            strengthened provision is for language to function as        speakers of English equally. The very definition of
            an additional safety net in critical situations.             the ICAO standard requires that proficient speakers
                The newly revised ICAO Annexes 1 and 10 require          of English “use a dialect, accent or variety which is
            pilots and air traffic controllers on international routes   intelligible to an international community of English
            to demonstrate a clearly specified level of proficiency      language users.”
            in speaking and understanding English. All member               The ICAO proficiency scale is unique in that it
            States are to be in compliance with the language             does not measure nonnative speakers against native
            proficiency standard no later than March 5, 2008. As         speakers. It puts all English speakers in the same
            welcome as this regulation change is in standardizing        category of “English users,” requiring everyone in the
            language competency, it causes much anxiety for              system to be careful and considerate users of the shared
            those crews who do not routinely use English in their        language. Native speakers typically have more language
            professional or social contexts. Anyone who has ever         facility than nonnative speakers and, therefore, need
            seriously attempted to master a language knows that          to be especially vigilant in their language use habits.
            it is no simple task.                                        For example, native English-speaking controllers and
                The ICAO English proficiency scale is a detailed         pilots should avoid all regional and colloquial expres-
            six-level matrix (see page 18), with level 4 (Operational    sions at all times. They should enunciate their words
            Level) being the lowest acceptable level of competency       with care to minimize the effect of their particular
            required of pilots and controllers in order to engage        accent. And, if they are still not understood by the
            in their respective aviation operations safely.              other crew, they should paraphrase the intended
            The proficiency requirement focuses on linguistic            message; repeating the same thing or getting louder
            competence rather than knowledge of culture; the             does little to resolve the already tense situation. In
            structure and vocabulary of the English language             other words, if nonnative (continued on next page)




Winter 2004/2005                                                                                                   17               Flightline
                                                                                                                                Guest Feature                                                              (continued from previous page)




             speakers must engage in the time-
             consuming and costly effort to                                                                                     ICAO LANGUAGE PROFICIENCY RATING SCALE
             master English better than ever
             before, then the least that native
                                                                     LEVEL                      PRONUNCIATION                                    STRUCTURE                                 VOCABULARY                                        FLUENCY                                  COMPREHENSION                                     INTERACTIONS
                                                                                                   Assumes a dialect and/or               Relevant grammatical structures and
             speakers can do is to meet them                                                       accent intelligible to the             sentence patterns are determined by
             “half-way.”                                                                           aeronautical community               language functions appropriate to the task
                Communication is always a
                                                                      EXPERT                Pronunciation, stress, rhythm,              Both basic and complex                       Vocabulary range and accuracy              Able to speak at length with a                 Comprehension is consistently                      Interacts with ease in nearly all
             negotiation of meaning between                              6                  and intonation, though                      grammatical structures                       are sufficient to communicate              natural, effortless flow. Varies               accurate in nearly all contexts and                situations. Is sensitive to verbal
             two or more parties. Nowhere is it                                             possibly influenced by the                  and sentence patterns are                    effectively on a wide variety of           speech flow for stylistic effect,              includes comprehension of linguistic               and non-verbal cues, and
             more critical than in the global                                               first language or regional                  consistently well controlled.                familiar and unfamiliar topics.            e.g. to emphasize a point. Uses                and cultural subtleties.                           responds to them appropriately.
                                                                                            variation, almost never                                                                  Vocabulary is idiomatic, nuanced,          appropriate discourse markers
             aviation context. As international                                             interfere with understanding.                                                            and sensitive to register.                 and connectors spontaneously.
             aviation continues to grow, language
                                                                   EXTENDED                 Pronunciation, stress, rhythm,              Basic grammatical structures                 Vocabulary range and accuracy              Able to speak at length with                   Comprehension is accurate on common,               Responses are immediate,
             capability beyond the established                         5                    and intonation, though                      and sentence patterns are                    are sufficient to communicate              relative ease on familiar topics,              concrete, and work related topics and              appropriate, and informative.
             pilot-controller lexicon is a must.                                            influenced by the first language            consistently well controlled.                effectively on common, concrete,           but may not vary speech flow as a              mostly accurate when the speaker is                Manages the speaker/listener
             Contracting ICAO States, all 188 of                                            or regional variation, rarely               Complex structures are attempted             and work related topics.                   stylistic device. Can make use of              confronted with a linguistic or situa-             relationship effectively.
                                                                                            interfere with understanding.               but with errors which sometimes              Paraphrases consistently and               appropriate discourse markers                  tional complication or an unexpected
             them, last year agreed to adopt the
                                                                                                                                        interfere with meaning.                      successfully. Vocabulary is                or connectors.                                 turn of events. Is able to comprehend
             new language provisions. They                                                                                                                                           sometimes idiomatic.                                                                      a range of speech varieties (dialect
             agreed to put aside all nationalistic                                                                                                                                                                                                                             and/or accent) or registers.
             notions about language for the sake                 OPERATIONAL                Pronunciation, stress, rhythm,              Basic grammatical structures                 Vocabulary range and accuracy              Produces stretches of language at              Comprehension is mostly accurate on                Responses are usually immediate,
             of common safety. In linguistic and                   LEVEL 4                  and intonation are influenced               and sentence patterns are used               are usually sufficient to                  an appropriate tempo. There may                common, concrete, and work related                 appropriate, and informative.
             aviation history this is no small                                              by the first language or regional           creatively and are usually well              communicate effectively on                 be occasional loss of fluency on               topics when the accent or variety used             Initiates and maintains
                                                                                            variation but only sometimes                controlled. Errors may occur,                common, concrete, and work                 transition from rehearsed or                   is sufficiently intelligible for an                exchanges even when dealing
             accomplishment.                                                                interfere with understanding.               particularly in unusual or                   related topics. Can often                  formulaic speech to spontaneous                international community of users.                  with an unexpected turn of
                                                                                                                                        unexpected circumstances, but                paraphrase successfully when               interaction, but this does not                 When the speaker is confronted with                events. Deals adequately with
                Dr. Marjo Mitsutomi with a Ph.D.                                                                                        rarely interfere with meaning.               lacking vocabulary in unusual              prevent effective communication.               a linguistic or situational complication           apparent misunderstandings
                                                                                                                                                                                     or unexpected circumstances.               Can make limited use of discourse              or an unexpected turn of events,                   by checking, confirming,
             in Applied Linguistics from Ball State                                                                                                                                                                             markers or connectors. Fillers are             comprehension may be slower or                     or clarifying.
             University is full-time faculty in the                                                                                                                                                                             not distracting.                               require clarification strategies.
             School of Education at the University            PRE-OPERATIONAL               Pronunciation, stress, rhythm,              Basic grammatical structures                 Vocabulary range and accuracy are          Produces stretches of language,                Comprehension is often accurate on                 Responses are sometimes imme-
             of Redlands in Redlands, California.                    3                      and intonation are influenced               and sentence patterns associated             often sufficient to communicate            but phrasing and pausing are                   common, concrete, and work related                 diate, appropriate, and inform-
                Dr. Mitsutomi has been actively                                             by the first language or regional           with predictable situations are              on common, concrete, or work               often inappropriate. Hesitations               topics when the accent or variety used             ative. Can initiate and maintain
             involved in pioneering English language                                        variation and frequently                    not always well controlled.                  related topics but range is limited        or slowness in language                        is sufficiently intelligible for an                exchanges with reasonable
                                                                                            interfere with understanding.               Errors frequently interfere                  and the word choice often                  processing may prevent effective               international community of users.                  ease on familiar topics and in
             standards for aviation in the US. A                                                                                        with meaning.                                inappropriate. Is often unable             communication. Fillers are                     May fail to understand a linguistic                predictable situations. Generally
             native of Finland, she was appointed                                                                                                                                    to paraphrase successfully when            sometimes distracting.                         or situational complication or an                  inadequate when dealing with
             by the FAA to serve on the ICAO                                                                                                                                         lacking vocabulary.                                                                       unexpected turn of events.                         an unexpected turn of events.
             PriceGroup (Proficiency Requirements                 ELEMENTARY                Pronunciation, stress, rhythm,              Shows only limited control                   Limited vocabulary range                   Can produce very short, isolated,              Comprehension is limited to isolated,              Response time is slow, and
             in Common English) Linguistic Sub-                       2                     and intonation are heavily                  of a few simple memorized                    consisting only of isolated                memorized utterances with frequent             memorized phrases when they are                    often inappropriate. Interaction
                                                                                            influenced by the first language            grammatical structures and                   words and memorized phrases.               pausing and a distracting use of               carefully and slowly articulated.                  is limited to simple routine
             group, which defined and wrote the                                             or regional variation and usually           sentence patterns.                                                                      fillers to search for expressions and                                                             exchanges.
             recently adopted English language                                              interfere with understanding.                                                                                                       to articulate less familiar words.
             standard for global aviation.
                                                              PRE-ELEMENTARY                Performs at a level below the               Performs at a level below the                Performs at a level below the              Performs at a level below the                  Performs at a level below the                      Performs at a level below the
                A private pilot herself, she serves M.I.             1                      Elementary level.                           Elementary level.                            Elementary level.                          Elementary level.                              Elementary level.                                  Elementary level.
             AIR flight school as Vice President.
                                                           Note – The Operational Level (Level 4) is the minimum required proficiency level for radiotelephony communication. Levels 1 through 3 describe Pre-elementary, Elementary, and Pre-operational levels of language proficiency respectively, all of which describe a level of proficiency below the ICAO language
                                                           proficiency requirement. Levels 5 and 6 describe Extended and Expert levels, at levels of proficiency more advanced than the minimum required Standard. As a whole, the scale will serve as benchmarks for training and testing, in assisting candidates to obtain the ICAO Operational Level (Level 4).




Flightline                18                                                                                                                               Winter 2004/2005                           Winter 2004/2005                                                                                                                                     19                 Flightline
I N F O         THE B PLAN : UNIT ACCUMULATION
                AND LUMP SUM DISTRIBUTION
                  BY CAPTAIN HENRY COCHRAN, (DFW), MS, MBA, CPA
                  CA Cochran served for seven years on the Pension Committee

                     Have you ever wondered about the process which             The current year’s adjusted unit values were
                  goes into the building of your individual B Plan units     reported as follows:
                  and, ultimately, the distribution of their value upon         JAN 2004 ..............$ 99.603
                  retirement? Many of our pilots probably have a good           FEB 2004 ..............$101.781
                  handle on the necessary calculations, however, some           MAR 2004 ..............$ 95.948
                  of the finer points may have been lost along the way.         APR 2004 ..............$ 94.004
                  Hopefully, this article will provide a better under-          MAY 2004 ..............$ 94.837
P E N S I O N



                  standing of the mechanics which go into that final            JUN 2004 ..............$ 96.874
                  determination.                                                JUL 2004 ..............$ 93.633
                     It should be noted, first, that the B Plan represents      AUG 2004 ..............$ 93.633
                  the total value of all the units held by the pilots in        SEP 2004 ..............$ 96.041
                  the Plan. Every pilot holds a certain amount of units         Notice the drop in adjusted unit value in MAR
                  which, based on the unit value, gives him or her a         2004. This is primarily because of the adjustment
                  certain asset value of the Plan. It’s hard to say what     which increases the number of units in every pilot’s
                  the average pilot will take with him upon retirement       account by 6%, with an offsetting decrease in unit
                  from American Airlines because the B Plan ownership        value. Another factor which affects the MAR 2004
                  consists of members who were all vested at different       adjusted unit value is the 12/31/03 audited unit
                  times in their professional careers. When you consider     value calculation which takes into account all prior
                  that participation in the plan will be shorter for those   year accounting activity.
                  pilots who were formerly with TWA, Reno, and Air              It should be noted that the year end audit of the B
                  Cal, it’s easy to see why there is no “average” pilot.     Plan takes place after the close of the year, therefore,
                  However, if we look at all of our pilots who retired in    the audited unit value will not be calculated for a few
                  2003, we find that those who retired with 15 years of      months after the 12/31/03 year-end close, and will not
                  service had accumulated an average of 3,269.598            be reported (i.e., included in the adjusted unit value)
                  units worth $257,457, while those who retired with         until MAR 2004 and for the 11 months following.
                  23 years of service had accumulated an average of             Also worth mentioning is that since the early
                  7,830.279 units worth $602,892.                            1980’s, a pilot could walk away at his Normal
                     Very simply put, the individual pilot’s B Plan value    Retirement Date or Early Retirement Date with his
                  is equal to the number of units that he has acquired       lump sum in hand (or in his account) provided he
                  throughout his career multiplied by the unit value         has given the Company at least 120 days advance
                  which he locks in at retirement. You may have seen         notice of his Early Retirement Date. This gives the
                  reference to two different types of unit values. The       Company the time necessary to ensure that all
                  audited unit value is calculated at the end of each        Optional Contributions are stopped and that all
M O R E




                  calendar year and is used to determine the number of       administrative activity necessary to having the pension
                  units the company will purchase for each pilot (based      check ready on the pilot’s benefit commencement
                  on his annual compensation) during the coming              date are completed. On the occasion where 120 days
                  year. The adjusted unit value is calculated each           advance notice is given, the Company uses estimated
                  month, reflects the investment earnings within the         pay for the last few months to enhance the check
                  plan, and is used to determine the lump sum amount         preparation process. Pilots who retire early without
                  to be distributed to each retiring pilot.                  giving the required 120 day notice, will not have
                     To illustrate the concept of B Plan unit accumulation   their lump sums on their retirement dates since their
                  and ultimate lump sum distribution, let’s use current      benefits will be determined using actual pay. These
                  figures as reported by the B Plan. The last two years’     pilots will have their B Plan benefit paid using the
                  audited unit values were reported as follows:              unit value for the month in which their notice of
                     12/31/02..........$72.676                               early retirement is given to the Company. Since in
                     12/31/03..........$92.707                               this case, payment is based on actual pay, the lump

Flightline        20                                                                                                  Winter 2004/2005
sum is not available until final payroll is processed,     of the 6% adjustment. If he had opted to retire under
generally 60 days following the date of retirement.        the annuity option, however, there would have been an
For years, retiring pilots have been locking in the unit   increase in his unit total due to a proration equal to
value, trying to maximize their B Plan distribution.       4% (8/12 multiplied by 6%). Eight months multiplied
During periods of decreasing adjusted unit values,         by $11,000 per month equals his 2004 compensation
they would lock in a value during a prior month,           of $88,000. The company contribution of $9,680
thus assuring themselves of a higher unit value than       (11% of $88,000) divided by the 12/31/03 audited
the one which would otherwise be used. Conversely,         unit value of $92.707 equals 104.415, the number of
if adjusted unit values were increasing, they would        units to be added to his account in 2004. Captain
want to wait until the last possible moment to lock        Smith’s account will then have 5,104.415 units. At the
in the unit value, and, if they were to continue flying    JUN 2004 adjusted unit value of $96.874, his B Plan
all the way to age 60, the adjusted unit value for the     units and, ultimately, his lump sum distribution will
third month prior would then be used to determine          be worth $494,485.10. The Company will have his
the lump sum value.                                        check ready for him to pick up on or about
   For the purpose of illustration, assume Captain         November 1.
Smith has been with the company for 20 years and              In the last example, let’s assume Captain Smith
will command an annual salary of $132,000 (at a rate       decided to retire May 1, did not give 120 days advance
of $11,000 per month) for the year 2004. At the end        notice, and locked in an adjusted unit value for FEB
of 2003 he had 5,000 units in the B Plan. Examples         2004 at $101.781. Once again, he does not get the 6%
covering three different scenarios will be offered to      increase in units, but as before, he receives the benefit
further show the concept of unit accumulation and          of having shares accumulate due to his having worked
lump sum distribution. In the first example, Captain       four months. There is one slight difference, however.
Smith will work the entire year of 2004 with plans         Since he locked in an adjusted unit value prior to the
toward continuing his employment into the following        12/31/03 audited unit value being calculated, he
year. No activity will take place within his account       must use the audited unit value for 12/31/02 to
until the end of the year, i.e. his number of units will   determine how many units he will accumulate in
not be increased during any month throughout the           2004. Four months multiplied by $11,000 per month
year. At the end of the year 2004, two things will         equals his 2004 compensation of $44,000. The
happen. First, any units he will have had in his           company contribution of $4,840 (11% of $44,000)
account for the entire year (5,000) will be increased      divided by the 12/31/02 audited unit value of
by 6%. As a result, his account will now have 5,300        $72.676 equals 66.597, the number of units to be
units. In addition, an amount equal to 11% of his          added to his account in 2004. Captain Smith’s
compensation will be used by the Company to                account will then have 5,066.597 units. At the FEB
purchase units for his account for 2004. The units to be   2004 adjusted unit value of $101.781, his B Plan
added are calculated by dividing the aforementioned        units and, ultimately, his lump sum distribution will
contribution by the 12/31/03 audited unit value. In        be worth $515,683.30. The Company will have his
this case, the contribution is equal to $14,520 (11%       check ready for him to pick up on or about July 1.
of $132,000) and the audited unit value is $92.707.           This information has, hopefully, been helpful in
The additional units to be added equals $14,520/           portraying how specific calculations within the B
$92.707, or 156.622. Captain Smith’s account will          Plan are performed. It goes without saying that no
then have 5,456.622 units. At an assumed adjusted          one should be more interested in how the B Plan
unit value of $100 at year end, his B Plan units would     builds value than YOU. As you near retirement, it is
be worth $545,662.20 as of JAN 2005.                       paramount that you understand exactly how the
   In the next example, let’s assume Captain Smith         process works so that, just like those before you who
decided to retire September 1, did not give 120 days       availed themselves of this very same information,
advance notice, and locked in an adjusted unit value       you will also be able to maximize the distribution
for JUN 2004 at $96.874. He does not get the 6%            that you receive from your share of the B Plan.
increase in units, but does get the benefit of having
units accumulate due to his having worked eight
months. (Note: Because Captain Smith is opting for                   Endorsed by
the lump sum distribution and has locked in his                      the APA Pension
retirement in the current year, there is no proration                Committee


Winter 2004/2005                                                                                                  21   Flightline
                                   HOW A FULL BODY
                                  SCAN SAVED MY LIFE
                                                                 BY CAPTAIN RICHARD LINDEKENS (LAX)
     Aeromedical Committee
                                For my 57th birthday, I decided that a full physical     revealed I had a five centimeter-sized renal cell
                             examination and body scan was in order to assess the        carcinoma located in my left kidney. My doctors
                             state of my health. As a commercial airline pilot, I have   referred me to UCLA Medical Center and one week
                             always tried to stay physically fit. I knew about body      later, I was in surgery.
                             scans. I had heard about controversy over whether              My choice to have the body scan to celebrate my
                             body scans were useful or not. As I found out, my           birthday could not have been more timely. Even
                             decision to have one quite possibly saved my life.          though I had no symptoms to suggest I had any
                                The scan itself was pretty easy - the procedure took     medical conditions, the tumor was threatening my
                             about five minutes and I was done. I spent the next         life. If the cancer had gone undetected, within
                             45 minutes of the appointment reviewing with the            months, it would have spread from my kidney
                             doctor a virtual tour of my body. The analysis was          throughout my body. No less than five doctors told
                             better than any anatomy class I had ever attended.          me the tumor was discovered just prior to it being
                             The doctor showed me my lungs, heart, liver, muscle         released into my body. Undoubtedly, if I had not
                             and bone structure. The review was going smoothly.          elected to use a body scan the results could have
                             However, once he examined the part of the scan              been life-threatening.
                             showing my left kidney, the doctor identified what             I am sharing my experience in hopes that it might
                             could be a large tumor. He recommended that I go to         help a fellow pilot who may be considering whether
                             my doctor for an immediate follow-up and further tests.     there is value in a body scan. For me, the choice was
                                The next day I found myself undergoing extensive         a life-saving decision!
                             lab tests and more specific x-ray exams. The tests




                                  Full body scans have downside
                                                                    BY CAPTAIN RANDY POPIEL,
                                                         CHAIRMAN, APA NATIONAL AEROMEDICAL COMMITTEE

                                     If you are contemplating the use of a Body Scan as an additional tool in the evaluation of your
                                  medical health, please keep the following in mind. While results such as the one being mentioned
                                  here are positive and a scan has the possibility of identifying a critical issue, in a large number of
                                  cases the following occurs. The scan data identifies a problem or concern area, which after additional
                                  testing and follow-up is found to be of no consequence or health risk. This is a particularly vexing
                                  problem for the professional pilot. Almost any abnormal finding warrants additional testing and
                                  triggers the possibility of additional FAA-mandated testing and submissions of data to the FAA.
                                  During the period of evaluation, a pilot’s medical certification is put in jeopardy. Undue stress, anxiety,
                                  testing and medical expenses are caused unnecessarily. An asymptomatic pilot should carefully weigh
                                  the decision to use the body scan.
                                     If you are considering the scan, always research the facility’s medical qualification and the
                                  technology it uses. Also beware of facilities that use aggressive marketing practices. Scans produce
                                  high revenues and some providers used high pressure tactics to entice upper income individuals.



Flightline                   22                                                                                                    Winter 2004/2005
                                                                                                                                C O M M I T T E E
THE 2004 LINE OPERATIONS
SAFETY AUDIT
        BY CAPTAIN RICH CUNNINGHAM, MANAGER, FLIGHT SAFETY PROGRAMS, AA SAFETY DEPARTMENT



   The 2004 Line Operations Safety Audit, involving 303 cockpit observations by a team of 20 observers from
American, the Allied Pilots Association, and the FAA AMR Certificate Management Office, concluded on Oct. 31,
2004. The 2004 audit focused on the MD-80 fleet due to the transition of former LLC airplanes to the AA f leet
and the large number and types of destinations. Areas of interest included the following: findings from the
2003 Safety Focus Audit where corrective action was applied, areas of interest to the MD-80 fleet support team,
procedural changes to FM Part I that resulted from Operation Streamline, and other performance indicators. The
results are encouraging, actually dramatic. There was a decrease in the number of non-standard findings in all but
one area previously audited. Some areas improved fivefold. The one area that had received the most emphasis
from Flight Training, Stabilized Approaches, improved to standard on 97.7% of observed flights. I would like
to thank all the crewmembers who graciously received the audit team members into your cockpits. LOSA
contributes toward improved procedures, more focused training, and a safer, more efficient airline. I would like
to extend my personal thanks to the audit team and to Captain Hettermann for making the audit possible.

                   NUMBER OF AUDITS                              AUTOMATION LEVEL INSTALLED IN AIRCRAFT




                                                                                                                                S A F E T Y
                                                  NUMBER OF AUDITS
                                                                               2004 Audit Results Comparison w/ 2003

                                Question Text                                   Percent    Percent Percent +=Positive
                                                                               Standard     Non-     Non-     trend
                                                                                          Standard Standard -=Negative
                                                                                                     2003     trend
  F/A briefing accomplished.                                                    90.0%       10.0%    7.4%      -2.6
  Jumpseat briefing accomplished.                                               93.3%      6.7%
  Captain manages workload during preflight phase to assure logbook review       98%       2.0%
  and flightplan crosscheck concerning MEL items is thorough and complete.
  Takeoff briefing accomplished at gate.                                        81.7%      18.3%
  No head down procedures performed while in ramp area while taxiing.           94.7%      5.3%
  Airport Diagram in use by both pilots while taxiing out 93.3%6.7%             93.3%      6.7%       25.3%          +19.6
  Captain manages workload during taxi in a manner that prevents possibility    98.0%      2.0%
  of runway incursion
  Pressurization checked after takeoff, cleanup                                 85.9%      14.1%      29.0%          +14.9
                                                                                            (continued on page 26)

Winter 2004/2005                                                                                                23           Flightline
                                     PILOTS MUTUAL AID

     PILOTS HELPING PILOTS
                                      BY CAPTAIN STEVE THOMAS, (DFW), PMA CHAIRMAN


       Long before there was an Allied Pilots Association there     excess of the amounts being contributed. While the PMA
    was a Pilot Mutual Aid (PMA) Plan. The 1953 directive stated    Board of Governors was monitoring this situation and
    in part, “PMA was originally started to benefit the pilot’s     planned to address it in the Spring Board of Directors
    widow who was left destitute when her husband died              meeting, PMA reserves and contributions were not
    and…later modified to assist pilots who were ill or injured     sufficient to cover the monthly disability benefits in May. In
    and disabled for an extended period of time, and included a     order to remain solvent, the Board of Directors approved a
    death benefit for use to help defray burial costs, and supply   loan request from PMA.
    immediate cash when joint funds might be restricted.”
       This directive established PMA’s purpose, which remains      What Caused the Problem?
    to this day, “Pilots Helping Pilots.” PMA is an exceptional        There are three primary causes for the rapid decline in
    program that has worked well for over 50 years. Today, PMA      PMA funds.
    pays a benefit in the event of death ($5,000) or when you          First, the number of furloughed pilots has reduced
    are disabled and have exhausted all of your paid sick and       the number of contributing members by approximately
    vacation time.                                                  1,600 since the beginning of 2003. Currently, there are
       Recently, PMA has experienced a significant increase in      approximately 7,184 contributing PMA members; down
    the number of claimants and a significant decrease in the       from 8,860 in January 2003.
    number of contributing members. This combination has               Second, there has been an increase in the number of
    required the APA Board of Directors to approve an increase      claims since January 2003. In January of 2003 there were 47
    in the PMA contribution from $10.75 to $23.00 effective with    disability claims paid; in October of 2004, there were a total
    the June payroll deductions. The following is an explanation    of 79 disability claims paid. Monthly benefit payments
    of the reasons for this increase.                               have increased from $87,133 in January 2003 to $148,600
                                                                    in October 2004 with most of the increase occurring in
    How Is PMA Funded?                                              2004. The chart below shows the benefits paid compared to
       PMA operates as a separate, stand-alone program, outside     contributions received since October 2003. The large rise in
    of the dues monies paid to APA. Prior to 1997, the claims       contributions reflects the increase of June 2004.
    and expenses paid during the month were divided equally
                                                                           PMA Benefits and Contributions
    among the pilots participating in PMA. Thus, while all pilots
                                                                     $200,000
    paid the same amount, this amount varied each month. In
    1997, PMA was changed to set a monthly contribution rate
                                                                     $150,000
    sufficient to cover expected benefits and expenses for the
                                                                                                                                       Contributions
    coming year. This rate was to be reviewed and adjusted, as       $100,000                                                          Benefits Paid
    necessary, each year. The 1997 PMA contribution was $10 a
    month. It was lowered to $6.35 in 1998, but reserves went         $50,000
    below the level necessary to sustain PMA. In January 2001,
    the contribution amount was changed to $10.75. This                          Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Oct
                                                                                 03 03 03 04 04 04 04 04 04 04 04 04 04
    process worked well until last October.
       The trend was cyclical and showed that payouts were             Finally, the period of time that a participant collects
    basically equal to contributions with the reserves running      disability payments (“Duration”) has increased from 8.6
    about $400,000. Since October 2003, this trend has              months to 11 months. The participant is staying out longer
    significantly eroded. PMA has paid out monies well in           by almost 2.5 months.



Flightline            24                                                                                                                  Winter 2004/2005
     Comparing other Airline PMA Plans.
       Below is a chart comparing Southwest’s, Delta’s, and APA’ s Pilot Mutual Aid Programs.
                                              PILOT PMA PROGRAM COMPARISON
                                                              Benefit: (Amount,
       Company         Eligibility       Contribution                                                                Other
                                                              Duration, Offsets, etc.)
       Southwest       Date of Hire      $18/mo.              Amount: $1,000/mo. ($5,000 after exhausting            There is a provision
                                                              banked sick time and prior to LTD payments)            to reduce benefits if
                                                              Payments Begin: (later of)                             assets are insufficient
                                                                • 30 days after disability;                          to pay claims.
                                                                • Exhaustion of paid sick
                                                              Duration: 12 months
                                                              Death Benefit: $5,000
       Delta           Date of Hire      $.47 per $100 of     Amount: 42%-22% of average earnings for prior          Benefits reduced for
                                         gross monthly        12 months based on earnings (75%-92% of pre            other disability pay
                                         earnings.            disability pay between PMA and Company LTD).
                                         ($47.00 for a        Duration: 12 months per disability; 24-month           Company benefit
                                         $10,000/mo.          lifetime maximum                                       50% average monthly
                                         Pilot)               Death benefit: $15,000 paid within 48 hours of         earnings over last
                                                              death (5-6 deaths per year)                            36 months
       APA             Within first $23/mo.                   Amount: $2,000/mo.
                       5 years of                             Duration: 12 months
                       active service                         Death Benefit: $5,000

       Delta PMA has a greater benefit scale but the amount per month is double that of the APA Plan. The Southwest Plan
     decreases in both contributions and benefits. The APA Plan is comfortably situated between the Southwest and Delta Plans.
     Benefit Distribution by Code.
        This chart shows the amount of money distributed by disability. Code 1 is Accidents, Code 8 is Cancer. I have chosen not
     to label each column due to sensitive illnesses. These illnesses include AIDS, Alcohol, Drugs, Mental and Nervous disorders.
                                     AMOUNT OF MONEY DISTRIBUTED BY DISABILITY
       Month        Code 1       Code 2      Code 3     Code 4     Code 5          Code 6      Code 7     Code 8      Code 9       Total
       Jan-04      $22,600.03   $7,933.43   $16,400.12 $16,000.00 $34,200.21       $2,000.00     –       $8,866.81   $8,334.21   $116,334.81
       Feb-04      $21,733.42   $8,000.00   $19,933.43 $17,266.73 $47,000.25       $2,000.00     –       $6,000.00   $6,466.69   $131,000.38
       Mar-04      $22,000.00   $6,000.00   $20,800.04 $13,733.42 $54,000.23       $2,000.00     –       $6,000.00   $6,466.69   $131,000.38
       Apr-04      $21,426.74   $6,000.00   $21,133.39 $14,200.01 $62,267.08       $2,000.00     –       $6,000.00   $8,000.00   $141,027.22
       May-04      $20,000.00   $6,000.00   $20,000.00 $16,000.00 $68,333.75       $2,000.00     –       $5,733.45   $8,000.00   $146,067.20
       Jun-04      $18,933.48   $3,600.08   $19,133.39   $16,600.13   $71,866.96   $2,000.00     –       $6,000.00   $4,333.35   $142,467.39
       Jul-04      $17,266.73   $2,000.00   $21,866.76   $20,600.13   $73,333.70   $2,000.00     –       $6,000.00   $4,400.12   $147,467.44
       Aug-04      $18,266.88   $2,000.00   $21,266.73   $20,533.46   $79,133.59   $2,000.00     –       $7,600.08   $4,666.70   $155,467.44
       Sep-04      $13,933.43    $133.34    $22,000.00   $17,200.16   $84,400.12   $2,000.00     –       $7,466.74   $7,800.09   $154,933.88
       Oct-04      $14,000.00        –      $22,000.20 $14,466.79 $84,200.01        $866.71      –       $6,000.00   $7,066.72   $148,600.43
       Nov-04      $14,000.00        –      $23,666.95 $13,600.08 $80,133.54                             $6,000.00   $8,733.47   $146,134.04
       Dec-04            –           –            –          –          –               –        –            –           –             –
       Totals $204,160.71 $41,666.85 $228,201.01 $180,200.91 $738,869.44 $18,866.71              –      $71,667.08 $73,801.35 $1,557,434.06
     What Does this Mean to Me?
        PMA contributions have always been set as the minimum amount necessary to pay the benefits and expenses. Unlike
     other plans, PMA does not use your contributions to build a large reserve. While this keeps the contribution rate as low as
     possible, it means that contributions will fluctuate as needed to pay the claims and expenses. Thus, while the current rate
     is $23.00 per active member per month, if claims or expenses are lowered, the contributions will be lowered accordingly.
     The Board of Directors will again review the performance of PMA in the annual Fall Board meeting in October 2005.
                                                                                                        (continued on next page)


Winter 2004/2005                                                                                                        25             Flightline
    PILOT MUTUAL AID                      (continued from page 25)       completed five (5) cumulative years of Active Service with
       We realize this is a significant increase in your monthly         American Airlines.
    contributions. We ask that all of you remember that this is             Whatever resolution we find to this matter, be it
    a program of Pilots Helping Pilots and only pays disabled            maintaining the current contribution or a combination of
    pilots who have exhausted all of their paid sick and                 contributions and benefits changes, please remember this is
    vacation time and surviving family members following the             an inexpensive way to help out your fellow pilots in their
    death of a pilot. We would also like to remind you that              times of need, and hopefully you won’t become one of
    if you are considering dropping PMA and you have                     those whom this program continues to help.
    completed more than five (5) years of active service, you               One last important note, Captain Terry Cecil resigned as
    will not be allowed to re-enroll.                                    Chairman for the Board of Governors of PMA during the
       A special note to the St. Louis Domicile: If you were a           Fall APA Board of Directors meeting. Captain Cecil faithfully
    member of the ALPA PMA plan, you did not automatically               and diligently served the pilots of American Airlines for over
    roll over to the APA PMA Plan. Check your pay stub under             20 years as a member and Chairman. He was instrumental
    “After Tax Deductions.” If Pilot Mutual Aid is not listed as a       in the many changes that took place in order to keep PMA
    deduction then you are not enrolled. You may also call the           about “Pilots Helping Pilots.” This organization and the
    APA Benefits Department to confirm your enrollment.                  Allied Pilots Association owe a great debt of gratitude to
    Former TWA pilots are still able to enroll having not                Captain Terry Cecil.

THE 2004 LINE OPERATIONS SAFETY AUDIT                                              (continued from page 23)
                                                         NUMBER OF AUDITS
                                                                                            2004 Audit Results Comparison w/ 2003

                                         Question Text                                       Percent    Percent Percent +=Positive
                                                                                            Standard     Non-     Non-     trend
                                                                                                       Standard Standard -=Negative
                                                                                                                  2003     trend
 Crew maintained fuel log                                                                    89.4%       10.6%   20.7%     +10.1
 With FMS, verified with other pilot before executing                                        83.3%      11.7%      19.0%         +6.3
 Donned O2 mask above FL250 when required                                                    83.5%      16.5%      27.1%         +10.6
 Approach briefing accomplished (timing, content)                                            98.3%       1.7%       6.1%         +4.4
 Stabilized approach, met all criteria                                                       97.7%       2.3%       10.3%        +8.0
 Touchdown point (centerline, touchdown zone)                                                98.7%       1.3%       7.9%         +6.6
 On visual approach, used all available navaids                                              99.6%       0.4%       2.3%         +1.9
 Airport Chart out and referenced while taxiing in                                           84.2%      15.8%      30.4%         +14.6
 Crew takes time to ensure equipment clearance is adequate during gate arrival               99.7%       0.3%
 Sterile cockpit procedures utilized throughout taxi, takeoff, climb, descent and landing    93.7%       6.3%      12.4%         +6.1
 “Point and Shoot” used for all altitude changes                                             90.0%      10.0%       10.6%        +0.6
 Read back of all clearances per Flight Manual Part                                          94.7%       5.3%       6.1%         +0.8
 Captain manages workload during heading/altitude changes in a way that minimizes            100.0%      0.0%
 possibility of TCAS RAs.
 PA announcement to flight attendants when approaching or entering turbulence is             90.4%       9.6%
 specific and standard in accordance with procedures
 Single engine taxi utilized when appropriate                                                89.0%      11.0%
                                                                                            1-3 min    3-5 min Over 5 min      not done
 Time for external power to be plugged in …                                                  87.0%       9.0%       0.0%         4.0%
 Time for external air conditioning to be plugged in*                                        18.0%       8.0%       3.0%        72.0%
 *NOTE: Ambient temperatures throughout October were quite mild, which probably
  contributed to the low use of external air conditioning.

Thanks to all of the LOSA Auditors, whose dedication and professionalism made this study possible: From AA – CA Rick Ash, CA
E.D. Crowe, CA David Culbertson, CA Bob East, FO Brad Ewing, FO Howard French, CA Randy Klaus, CA Mike Leone, CA Ted
Osowski, CA Jay Schwartz. From the FAA – John Cowan, Thomas Daniell, Walter Garrard, Eugene Hill, Willard McMillen, Lonnie
Ramon, Michael Spencer, Robert Teer, Robert Whitley.

Flightline             26                                                                                                    Winter 2004/2005
                                                                                                                            C O M M I T T E E
HOW TO USE THE SEP TOOLS: The
Conflicted Pick-up and Generic Bid
                                           BY FIRST OFFICER RICHARD G. “DOC” MILLER, (DCA), TASC & JSC



    The Schedule Enhancement Period (SEP) is a line-        dropped (traded) based upon a predetermined
holder’s first opportunity to interact with Open Time.      hierarchy, as follows:
It is the only part of our TTOT system that is seniority-      • First the programming looks at the legalities. If
based. The most senior pilots have the distinct                   there are clear conflicts with the return/departure
advantage of being able to go into the SEP knowing                of any of the two trips and the pick-up sequence,
what trips are available for possible trade or pick-up.           that specific two-day will be eliminated from
All the rest of us know from experience, the open time            consideration.
mix changes dynamically as the SEP run progresses              • Programming also looks at the RED/REDDER
down the seniority list.                                          rules for each of the sequences on my schedule
    SEP provides two tools that are often misunder-               and will eliminate any trade that would not
stood – the Conflicted Pick-up and the Generic Bid.               meet the TTOT rules.
While the Conflicted Pick-up is a useful tool for all,         • If both sequences are still in the running for the
the Generic Bid is less likely to be needed by the                pending trade, then the following will determine
most senior pilots but is a very useful tool for those            which sequence I drop:
with less seniority.                                                 The one with the lowest projection;
                                                                     Then the most legs;
SEP CONFLICTED PICK-UP                                               Then the highest time away from base (TAFB);
   The Conflicted Pick-up, under most circumstances,                 Then the latest return time;
is essentially a trade. I offer the following example                And if both sequences are still the same,
schedule for the week of the 10th:                                   the trip that is latest in the month.
                                                               The programming will try to complete each of my
  10       11      12     13      14       15      16       Conflicting Pick-ups in the order I have selected. If
    10027                                   10126           one is successful, it now counts as my one allowed
                                                            Pick-up and Drop and the program will stop processing
   In this case my schedule has two two-day trips,          my SEP Ballot.
and there are several three-day trips open on the              I could study each of the possible trades involved,
12th. I wish to pick-up one of the trips on the 12th        relying on my knowledge of contractual and other
but realize I have possible conflicts with my current       FAA regulations and list each of the six possible
schedule. The obvious conflict is a seven-day problem.      trades that I determine are legal and in the specific
The less obvious possible conflicts are “30 in seven,”      order I prefer. But since I don’t have any overriding
exceeding MMAX + five, or time off between                  preference, other than getting one of the three open
sequences (return/departure legalities). If there are       three-day sequences on my schedule, I’ll let the
three known three-day sequences open on the 12th,
I could make six separate SEP entries where I try to
                                                            programming do the mental gymnastics for me.
                                                               In some cases, there might not be a conflict. If,
                                                                                                                            T A S C
trade each of my two-days with each of the three            instead, I had chosen to go for several two-day
open three-days. Or, I could just make three SEP            sequences open on the 13th, I could end up with all
entries using the Conflicted Pick-up. The three SEP         three trips on my schedule. In other words, if I placed
entries for this situation appear below.                    a Conflicted Bid on my SEP ballot, yet no conflict exists,
 HISEP/#/P/10014/12/C
                                                            and the pickup is awarded, I may still drop another trip
 HISEP/#/P/10004/12/C
                                                            into open time with an entry further down my SEP ballot.
 HISEP/#/P/10022/12/C                                          One final note on the use of this tool. The trip to
                                                            be “picked up” in a conflicted pick-up transaction
  I listed the three open sequences in the order I          must have a specific sequence number and date. Generic
prefer for pick-up. The computer programming will           “conflicted pick-ups” are not currently permitted.
then determine which of my two-day trips gets                                                (continued on next page)

Winter 2004/2005                                                                                                   27    Flightline
C O M M I T T E E
                    SEP GENERIC BID                                              discuss the optional entries individually then put
                       Depending on how junior you are, you may have             them together with varying scenarios.
                    often found when you tried to pick-up or trade for a            The next two fields I might need allow me to
                    specific sequence that was open before SEP ran, the          specify scheduled Departure and/or Return windows,
                    results of your SEP Ballot returned “SEQ NOT                 based upon the departure and return times of the
                    OPEN.” That simply means someone senior to you               flights that define a sequence.
                                                                                  HISEP/#/P/2D2P/10-16/D10-16/R15-20
                    got your request. What to do? Try the Generic Bid.
                       The Generic Bid is designed primarily for picking up
                    or trading for non-specific sequences but it is also            Here I have specified I want the program to search
                    useful for minimizing the number of bids a pilot needs       for 2D2P trips departing on any day between the
                    to make. (There is no such thing as a Generic Drop.)         10th and the 16th that depart (not sign in) between
                    First, we need to explore all the separate entries.          1000 and 1600 on each of those days. I also specified
                       There are both mandatory and optional entries. The        that they must return between 1500 and 2000 (not
                    mandatory entries are order specific and appear below.       including debrief). Again, because of limited character
                       For a Pick-up:                                            spacing, only whole hours may be used. In either
                     HISEP/#/P/xDxP/date or date range                           field, if you enter a specific time, i.e., “D08,” then it
                                                                                 will only consider trips that depart exactly at 0800L.
                         For a Trade:                                               Another useful aspect of these entries is that you
                     HISEP/#/D/your seq/date/P/xDxP/date or date range           may invert them to eliminate a departure or return
                                                                                 window. If I were to enter “D10-07,” then the program
                       You determine the unknown “x” entries as you fill         will first look for departures between 1000-2400,
                    in the bid. In this instance, the xDxP is an entry           then 0000-0700 on each of the dates I specified. It
                    unique to the Generic Bid and represents number of           will exclude all departures in the 0700-1000 window.
                    Days and number of Duty Periods you are looking              The same applies for the return window. For those
                    for in an open sequence. It is important that pilots         who wish to avoid commuting to the airport during
                    understand the differences between days and duty             rush hour, this inverted entry might work well.
                    periods. Days are simply the number of calendar days            Besides the operating times, I might also wish to
                    a trip covers. Duty Periods refers to the number of          narrow the choices of which airports are involved.
                    periods on duty. Multiple Duty Periods are separated         The CITY field (xxx) has three alternate options. I could
                    by a layover. A typical two-day domestic trip is a 2D2P,     either specify my Departure (by default, the same
                    whereas a typical LHR trip is a 3D2P. Anytime you            return) airport, or my Layover airport, or Eliminate a
                    wish to verify the number of days and duty periods           city from departure, arrival or layover consideration.
                    associated with any sequence use the HIQUAL entry.           If no CITY entry is used, then everything is in play.
                    Among other information, this entry will specify the         The examples:
                                                                                  HISEP/#/P/2D2P/10-16/D10-16/R15-20/DSNA
                    number of days and duty periods. Remember duty
                    periods run 0000-2359.
                     HIQUAL/seat/seq #/date                                       HISEP/#/P/2D2P/10-16/D10-16/R15-20/LMSY

                        If I am using the Generic Bid to look for a trip on       HISEP/#/P/2D2P/10-16/D10-16/R15-20/EEWR
                    a specific day, then I’ll only enter a specific date after
T A S C




                    the xDxP entry. This is the calendar date of departure.         In the first example, I am LAX based and I have
                    If I am looking for a sequence over a date range, then       specified I want my trip to depart and return to Orange
                    I’ll enter it using the format “10-16” or “10-16JAN.”        County, John Wayne Airport. All other sequences
                    The program recognizes any of the conventional date          that fail this requirement will not be considered. The
                    ranges. The only time the month (MON) must be                second example specifies I want the trip to have a
                    used is when you are in a contractual month that has         New Orleans Layover. The third example would
                    two dates with the same number, like the contractual         either eliminate any trip that lays-over at Newark
                    month of February, 01FEB-01MAR. Due to limited               airport or, if I were LGA based, would then only
                    character spacing, only a single date or date range          search for JFK and/or LGA departures and returns.
                    may be used per Generic Bid.                                 Specifically, for pilots based at Domiciles serving
                        Unlike the mandatory entries, the optional               multiple airports the D and E city fields can be used
                    Generic entries have no specific order and may be            to fine-tune your search.
                    used as needed. All the optional entries are the same           Another tweaking I might wish to specify is what is
                    for either a Generic Pick-up or Generic Trade. I will        the minimum time I want from my Generic bid. Take

Flightline          28                                                                                                     Winter 2004/2005
this Generic trade entry:                                       Not knowing what sequences will populate OT when
 HISEP/#/D/10021/10/P/2D2P/10-13/12H                            SEP gets to you doesn’t have to be a shot in the dark.
                                                                By a careful mix of all the optional entries, you
   Here I am looking to trade my 10-hour, two-day               should be able to zero in on any specific sequence on
on the 10th for any 2D2P on the 10-13th that is                 any day or number of days throughout the month.
worth a minimum of 12 hours. Simple enough.                       Take the following DFW S80 Sequence for example:
Again we must use whole hours because of the                      Let us assume, for whatever reason, I would like to
character limits.
   The final optional entries
are for First Officers. The
multiple crew positions, FO,
FB, FC are always associated
with different sequence num-
bers despite the possibility
of having the same flights in
the sequence. Currently, there
are four possible Generic Bid
entries: FO, FB, FC, or no
entry. For International FOs,
you need to understand how
the programming is set up. If
you are in an International
bid status with multiple
crew position options, know
that when using the Generic
Bid without one of the FO/FB/FC designators (the no             trade one of two trips for this specific sequence. I
entry option), the program will first search for all FO         don’t know if it will be open when the SEP run gets
sequences that meet your specifications. If it finds            down to me or if it is, on which day. My line is dis-
none, it will then search for any suitable FB, followed         played in the example below and the two trips I
by suitable FC sequences that fit your criteria. If you         would like to consider for trade are first the one on
want the search to only look for FO sequences, then             the 10th and then the one on the 15th. To cover all
your bid would look something like this:                        the possibilities I could make multiple entries for
 HISEP/#/D/10101/4/P/3D2P/1-31/FO
                                                                each day and each specific trip I wish to trade. If I
                                                                wanted to try to trade sequence 10027 on the 10th
  Here the bid is a generic trade, dropping sequence            for any day 7-12, I would need to make six separate
10101 on the 4th and looking to pick-up any 3D2P                SEP entries. Alternately, if I wanted to try to trade
FO sequence between the 1st and 31st. If I had specified        sequence 10126 on the 15th for this three-day
FB instead, then the programming will only look for             between the 12 and 17th, I would need an additional
FB then FC sequences. If I specified FC, then only FC           six SEP entries – 12 in all. (see below)
  5   6            7   8     9      10 11        12        13     14     15 16        17     18     19    20 21
  10027                              10027                                10126                            10027
sequences would be considered. Most importantly,              Or I could get by with just two Generic Bid
remember that if you are in such a bid status, leaving     SEP entries:
                                                   HISEP/1/D/10027/10/P/3D3P/7-12/D10-11/R19-20/LAUS/16H
it blank or no entry will allow the program to
                                                   HISEP/2/D/10126/15/P3D3P/12-17/D10-11/R19-20/LAUS/16H
search for any crew position you are qualified
for in this specified order: FO, FB, and then FC.
    Okay, those are all the possible optional entries.        I have made very narrow use of the optional
So what? Well, if you are not a senior line holder, you    entries for the Generic Bid. Essentially, I have limited
know from experience that you have little way of           my results to this one specific bid. The program will
knowing what will be available in Open Time                take care of checking for all the proper legalities and
through SEP when the run gets down to your seniority.      the RED/REDDER lights and will make the trade if the
Most likely, the trips you eyed before the run began       sequence is available. The narrow departure and return
were picked-up and traded by pilots senior to you.         windows, along with the AUS (continued on next page)

Winter 2004/2005                                                                                                   29    Flightline
C L A S S I F I E D S T A S C
                                               layover specification probably was specific enough,                                     At TASC we have learned that some pilots at
                                               but I added the time limit just in case.                                             American find these tools to be very powerful and
                                                  Here is another example. A senior SFO-based pilot                                 are getting positive results from their SEP bids. We
                                               who only wants to pick-up a turn during the month                                    have also discovered that there is much confusion
                                               to fill up to MMAX might use this one final example.                                 and hesitation concerning what may result with

                                                 HISEP/1/P/1D1P/1-31/DSFO/6H
                                                                                                                                    their employ. Hopefully, this article broadens your

                                                 HISEP/2/P/1D1P/1-31/EOAK
                                                                                                                                    knowledge sufficiently so that more of you will take
                                                 HISEP/3/P/1D1P/1-31/7H
                                                                                                                                    advantage of the tools available.
                                                                                                                                       One last reminder…Posted Trips can only be
                                                  The first SEP bid is most narrow and asks for a                                   Picked Up. You can never trade, use the Conflicted
                                               pickup anytime during the month, out of SFO worth                                    Bid, or use the Generic Bid to interact with a Posted
                                               a minimum of 6.00 hours. This is followed by a                                       Trip. Good luck and be sure and use the TTOT & SEP
                                               broader search for any turn other than an Oakland                                    help e-mails. If you have any comments or questions
                                               departure (SFO or SJC) with no minimum time                                          e-mail us at TTOT-HELP@ALLIEDPILOTS.ORG or
                                               specified. Finally, if there is no success on either of                              SEP@ALLIEDPILOTS.ORG
                                               the first two bids, include OAK (no city entry), but
                                               with a minimum of 7.00 hours.




                                                                         CLASSIFIED AD GUIDELINES
                                Flightline accepts classified advertising based on the   I Minimum 20 words per ad; maximum 100 words                  I A 10% discount is available on classified ads that
                                following guidelines:                                      per ad. No artwork or logos, please.                          run for three or more consecutive issues.
                                I Ads may be placed by APA members in good                                                                             I APA reserves the right to refuse advertising deemed
                                                                                         I Ads will be accepted in typed format only. To ensure
                                  standing and their spouses only.                                                                                       unsuitable for publication. No advertising will be accepted
                                                                                           complete accuracy, no handwritten ads, facsimile
                                                                                                                                                         on behalf of candidates for any APA elected office.
                                I Cost is $1.00 per word (“a,” “an,” “the” and             transmissions or telephone dictation will be accepted.
                                  telephone numbers each count as a word).                 Include a phone number where you can be reached             I You may mail, fax or e-mail your typed ad copy; and
                                                                                           in case we have any questions.                                mail your check or money order to: David Dominy,
                                I Must be prepaid with check or money order, made                                                                        Communications Coordinator; Allied Pilots Association;
                                  payable to “Flightline Classified Ads.” Include APA    I Due to U.S. Postal Service regulations governing              14600 Trinity Boulevard, Suite 500, Fort Worth,
                                  member’s employee number on check for reference.         non-profit organizations, we cannot accept any                Texas 76155-2512; Fax 817.302.2249; E-mail
                                  NOTE: APA waives the fees for all furloughed AA          advertising relating to airlines, credit cards, insurance     ddominy@hq.alliedpilots.org. Also, please contact
                                  pilots for the duration of their time on furlough.       or travel agencies.                                           Mr. Dominy for renewals or changes to your ad.
                                                                      For more information, call APA Communications at 817.302.2269 or 800.323.1470, ext. 2269.

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Flightline                                     30                                                                                                                                                Winter 2004/2005
R E V I E W   A Vietnam Helicopter Pilot’s War Story
                                By Captain Chuck Gross (ret.)
                    (University of North Texas Press, www.unt.edu/untpress)
                                                                                   FINANCIAL MATTERS
                   Rattler One-Seven puts you in the helicopter seat, to see the
                                                                                                   MONTHLY PENSION FACTORS
               war in Vietnam through the eyes of an inexperienced pilot as                 The following shows the interest discount rate for computing
               he transforms himself into a seasoned combat veteran.                       lump-sum payments under the Fixed Income Plan (A Plan) and
                                                     When Chuck Gross left for                    Unit Value for the Variable Income Plan (B Plan).
                                                Vietnam in 1970, he was a
                                                                                                             FIXED INCOME PLAN (A PLAN)
                                                nineteen-year-old Army heli-
                                                                                                                   Lump-Sum Interest         Estimated Age 60
                                                copter pilot fresh out of flight                                  Rate For Retirements       Lump-Sum Factor*
                                                school. He spent his entire
                                                                                                    8/1/04               5.42%                     12.74
                                                Vietnam tour with the 71st                          9/1/04               5.41%                     12.75
                                                Assault Helicopter Company                         10/1/04               5.22%                     12.98
                                                flying UH-1 Huey helicopters.                      11/1/04               5.06%                     13.18
                                                Soon after the war he wrote                        12/1/04               4.90%                     13.38
                                                down his adventures, while his                      1/1/05               4.86%                     13.43
                                                memory was still fresh with                                VARIABLE INCOME PLAN (B PLAN)
                                                the events.                                                       Adjusted Unit Value As Of
                                                     Rattler One-Seven (his call                                 5/31/04                 $94.837
               sign) is written as Gross experienced it, using these notes along                                 6/30/04                 $96.874
               with letters written home to accurately preserve the mindset                                      7/31/04                 $93.633
               he had while in Vietnam. During his tour Gross flew Special                                       8/31/04                 $93.633
               Operations for the MACV-SOG, inserting secret teams into Laos.                                    9/30/04                 $96.041
               He notes that Americans were left behind alive in Laos, when                                     10/31/04                 $97.986
B O O K




               official policy at home stated that U.S. forces were never there.   *The lump sum benefit from the Fixed Income Plan is determined by multiplying your annual
                   Rattler One-Seven will appeal to those interested in the        lifetime annuity by a conversion factor. This conversion factor, shown above, varies by the
               Vietnam War and to all armed forces, especially aviators, who       applicable interest rate, which changes monthly, and by age at retirement.
               have served for their country. It is the inaugural book in a new    IMPORTANT NOTICE TO RETIREES RECEIVING MONTHLY ANNUITY UNDER THE B PLAN:
               series called “The North Texas Military Biography and Memoir        As of your April 1, 2004 payment, your monthly payments will be based on the December 31,
                                                                                   2003 Audited Unit Value of $92.707.
               Series”. It was also picked by the Military Book Club as a
               recommended read.                                                      (Note: We publish the new rates and factors in Flightline as they are received.)
                   Chuck Gross logged more than 1,200 hours of combat
               flying and achieved Senior Aircraft Commander status. After                          1997 PILOT STOCK OPTIONS
               the war he became a commercial pilot and recently retired                              Activity since inception as of October 2004
               from American Airlines as a 767/757 Captain. Gross is also an                                     (Post SABRE Stock Split)
               instructor in the martial arts and has published a self-defense
               video course. He lives in Gallatin, Tennessee.                         Total number of pilots who have exercised some or all shares                   9,775
                                                                                      Average exercise price                                                       $28.717
                                                                                      Average number of shares exercised                                             1,769
                                                                                      Average amount (per pilot)                                                   $19,676

                          IN MEMORY                                                 (NOTE: This is for informational purposes only. It is not intended to provide advice
                                                                                                   regarding the exercise of options under the program.)
              We honor the following AA pilots and extend
                deepest sympathies to their loved ones.
      Ret. CA William T. Newkirk                              08/13/04               Have you updated your personal
      Ret. CA John “Jack” Myronuk                             08/29/04
      Ret. CA Robert P. Gormly                                09/10/04                   information with APA?
           CA Eddie Valdez                                    09/18/04               Help us keep our APA membership database accurate. When you change your
      Ret. CA Rodger Lochhead                                 09/24/04               address, phone number, e-mail address, etc., please advise us as soon as possible.
      Ret. CA Richard G. Brown                                09/28/04               (Changing your information with the Company is a separate procedure.)
      Ret. CA Miles G. Burford                                09/30/04               To update your information in the APA database, you may contact APA’s
      Ret. CA Travis A. Hinson                                10/06/04               database administrator via:
      Ret. CA Thomas R. Urban                                 10/12/04                 I E-MAIL     sfluty@hq.alliedpilots.org
      Ret. CA Charles “Chuck” Wilson                          10/17/04                 I WEB SITE www.alliedpilots.org (click ”UPDATE MEMBER PROFILE”
                                                                                                    on the Member’s Home Page.)
      Ret. CA Walter J. Hawker                                10/19/04
                                                                                       I PHONE 800.323.1470, ext. 2248
      Ret. CA W. W. “Bill” Wing                               11/07/04
           FO Gregory D. Sten                                 11/07/04                 I FAX        817.302.2119
      Ret. CA Freeman “Irby” Cobb                             11/19/04                 I MAIL       Attn: Database Administrator
                                                                                                    APA, 14600 Trinity Blvd., Suite 500
      Ret. CA Joseph “Milt” Coppage                           11/19/04
                                                                                                    Fort Worth, Texas 76155-2512


Flightline                     34                                                                                                                          Winter 2004/2005
ALLIED PILOTS ASSOCIATION
                                     Nonprofit Org.
O’Connell Building
                                      U.S. Postage
14600 Trinity Boulevard, Suite 500
                                          PA I D
Fort Worth, TX 76155-2512
                                      Arlington, TX
817.302.2272
                                     Permit No. 269
CHANGE SERVICE REQUESTED

								
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