In a performance-based organization (PBO), government executives are given broad exemptions from federal procurement and personnel rules in exchange for tough performance standards. The idea is that some federal programs can perform better if they are run more like private companies. Vice President Al Gore's National Partnership for Reinventing Government spearheaded the performance-based organization management concept in 1996. Since then, several agencies have asked permission to become PBO's, but the Education Department's Office of Student Financial Assistance (OSFA) and the Commerce Department's Patent and Trademark Office are the only federal agencies that have done so. OSFA became the first congressionally created performance-based organization in 1998. Clinton's executive order creates the Air Traffic Organization (ATO), which will be composed of FAA organizations that have direct connection to air traffic services. The order also creates a new position, chief operating officer of the air traffic control system, to head ATO. Under the terms of the PBO agreement, ATO must create a five-year plan for overhauling operations. The five-year plan aims to improve air traffic safety and customer service. As part of the deal, top executives will be offered monetary incentives for meeting performance goals. The chief operating officer, who will be hired through a nationwide competitive search, will be eligible for bonuses of up to 30 percent of his salary if annual performance goals are met. Other senior managers will be eligible for bonuses as well. "The fact is, the FAA's 20-year effort to modernize its air traffic control technology simply has not been able to keep pace with either the emergence of new technology or the growth and demand for air travel. And while we've made significant progress, as the horrendous--and I don't know how else to say it--just the horrendous flight delay statistics demonstrate, we have not done nearly enough," Clinton said at a press conference announcing the creation of ATO. The new flexibilites granted to FAA's air traffic division will allow the organization to better manage its operations and thus better control air traffic, Clinton said. "This semiautonomous organization, located within the FAA, will have the incentives and tools necessary to operate more effectively and efficiently," he said. The order also created a board of directors that will oversee ATO operations. Its members are private industry executives with extensive experience in business or in the transporatation industry. They are:
- John J. Cullinane, President, The Cullinane Group
- Nancy Kassebaum Baker, former U.S. Senator from Kansas
- Leon Lynch, International Vice President, United Steelworkers of America
- Sharon Patrick, President and COO, Martha Stewart Living Omnimedia, Inc.
- John W. Snow, Chairman, President and CEO, CSX Corp.