Southwest Airlines 2013 Annual Report Download - page 26

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. The TSA has 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. In response to a congressional mandate, beginning
in June 2013, airport scanners were outfitted with software designed to enhance passenger privacy by eliminating
passenger-specific images and instead using only a generic image of a passenger.
Beginning in November 2013, Southwest, in conjunction with the TSA and CBP, is participating in TSA
PreCheck™, a pre-screening initiative that allows a select group of low risk passengers the ability to move
through security checkpoints with greater efficiency and ease when traveling. Eligible passengers may use
dedicated screening lanes at certain airports that Southwest serves for screening benefits, which include leaving
on shoes, light outerwear and belts, as well as leaving laptops and compliant liquids in carryon bags.
Southwest also participates in the TSA Known Crewmember®program, which is a risk-based screening
system that enables TSA security officers to positively verify the identity and employment status of flight-crew
members. The program expedites flight crew member access to sterile areas of airports.
The Company has made significant investments to address the effect of security regulations, including
investments in facilities, equipment, and technology to process Customers, checked baggage, and cargo
efficiently and restore the airport experience; however, the Company is not able to predict the impact, if any, that
various security measures or the lack of TSA resources at certain airports 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
investigation or remediation of soil or groundwater contamination at several airport sites. The Company does not
believe that any environmental liability associated with these airport sites will have a material adverse effect on
the Company’s operations, costs, or profitability, nor has it experienced any such liability in the past that has had
a material adverse effect on its operations, costs, or profitability. Further regulatory developments pertaining to
the control of engine exhaust emissions from ground support equipment could increase operating costs in the
airline industry. The Company does not believe, however, that pending environmental regulatory developments
in this area will have a material effect on the Company’s capital expenditures or otherwise materially adversely
affect its operations, operating costs, or competitive position.
The federal government, as well as several state and local governments, the governments of other countries,
and the International Civil Aviation Organization are considering legislative and regulatory proposals and voluntary
measures to address climate change by reducing green-house gas emissions. At the federal level, the Environmental
Protection Agency’s Endangerment Finding in January 2010 regarding greenhouse gas emissions set the stage for
possible legislative or regulatory action to reduce greenhouse gas emissions from various segments of the economy,
including from aviation. The airline industry could be affected directly through new unfunded mandates or
indirectly through higher fuel costs as fuel providers pass on any additional costs to fuel consumers. Regardless of
the method of regulation, policy changes with regards to climate change are possible, which could significantly
increase operating costs in the airline industry and, as a result, adversely affect operations.
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