Southwest Airlines 2012 Annual Report Download - page 26

The Company is subject to various other federal, state, and local laws and regulations relating to
occupational safety and health, including Occupational Safety and Health Administration and Food and Drug
Administration regulations.
Security Regulation
Pursuant to the Aviation and Transportation Security Act (“ATSA”), the Transportation Security
Administration (the “TSA”), a division of the U.S. Department of Homeland Security, is responsible for certain
civil aviation security matters. ATSA and subsequent TSA regulations and procedures implementing ATSA
address, among other things, (i) flight deck security; (ii) the use of federal air marshals onboard flights;
(iii) airport perimeter access security; (iv) airline crew security training; (v) security screening of passengers,
baggage, cargo, mail, employees, and vendors; (vi) training and qualifications of security screening personnel;
(vii) provision of passenger data to U.S. Customs and Border Protection; and (viii) background checks. Under
ATSA, substantially all security screeners at airports are federal employees, and significant other elements of
airline and airport security are overseen and performed by federal employees, including federal security
managers, federal law enforcement officers, and federal air marshals. TSA-mandated security procedures can
affect the Company’s operations, costs, and Customer experience. For example, in 2006, the TSA implemented
security measures regulating the types of liquid items that can be carried onboard aircraft. In 2009, the TSA
introduced its Secure Flight program. Secure Flight requires airlines to collect a passenger’s full name (as it
appears on a government-issued ID), date of birth, gender, and Redress Number (if applicable). Airlines must
transmit this information to Secure Flight, which uses the information to perform matching against terrorist
watch lists. After matching passenger information against the watch lists, Secure Flight transmits the matching
results back to airlines. This serves to identify individuals for enhanced security screening and to prevent
individuals on watch lists from boarding an aircraft. It also helps prevent the misidentification of passengers who
have names similar to individuals on watch lists. In 2010, the TSA also implemented enhanced security
procedures as part of its enhanced, multi-layer approach to airport security by employing advanced imaging
technology (full body scans), as well as new physical pat down procedures, at security checkpoints. Such
enhanced security procedures have raised privacy concerns by some air travelers.
Enhanced security measures have also impacted the Company’s business through the imposition of
security fees on Southwest and AirTran and their Customers. Under ATSA, funding for passenger security is
provided in part by a $2.50 per enplanement security fee (the “9/11 Fee”), subject to a maximum of $5.00 per
one-way trip. In September 2011, the Administration proposed to Congress an immediate increase of the
9/11 Fee to a minimum of $5.00 per one-way trip and also proposed additional yearly increases that would raise
the 9/11 Fee to $7.50 per one-way trip by 2017. Congress may consider an increase in the 9/11 Fee, as well as
other changes to ATSA, as part of future security or deficit reduction legislation. ATSA also directs the TSA to
assess an Aviation Security Infrastructure Fee (“ASIF”) on each airline. The ASIF charge that each airline pays is
equal to that airline’s annual cost for passenger security services at airports prior to the creation of TSA in 2001.
The Company has made significant investments to address the effect of security regulations, including
investments in facilities, equipment, and technology to process Customers and cargo efficiently and restore the
airport experience; however, the Company is not able to predict the ongoing impact, if any, that various security
measures will have on Passenger revenues and the Company’s costs, either in the shortterm or the longterm.
Environmental Regulation
The Company is subject to various federal laws and regulations relating to the protection of the
environment, including the Clean Air Act, the Resource Conservation and Recovery Act, the Clean Water Act,
the Safe Drinking Water Act, and the Comprehensive Environmental Response, Compensation and Liability Act,
as well as state and local laws and regulations. These laws and regulations govern aircraft drinking water,
emissions from operations, and the discharge or disposal of materials such as jet fuel, chemicals, hazardous
waste, and aircraft deicing fluid. Additionally, in conjunction with airport authorities, other airlines, and state and
local environmental regulatory agencies, the Company, as a normal course of business, undertakes voluntary
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