Sharp cost increases and delays in implementation are harming efforts to modernize the air traffic control system, the Transportation Department's Office of Inspector General said in a report yesterday.

At a time when air travel continues to grow, the Federal Aviation Administration has become focused on maintaining the system it has rather than increasing capacity through system enhancements, the report said.

Sixteen FAA projects, such as new terminals for air traffic controllers and equipment to prevent runway accidents, were examined and 11 were found to have grown by more than $5.6 billion, pushing total current costs to about $14.5 billion.

The report said nine of the 16 projects had delays of two to 12 years and two projects have been deferred.

Congress appropriated $2.5 billion for facilities and equipment funding for fiscal 2005.

The two biggest cost increases and two of the bigger delays were in FAA projects led by Raytheon Co.

The cost of making the Global Positioning System fully usable for navigation and non-precision approaches, the Wide Area Augmentation System (WAAS), has grown 274 percent to $3.3 billion and is 12 years behind schedule, the inspector general found.

Another Raytheon program, known by its acronym STARS (standard terminal automation replacement system), to give air traffic controllers color displays, has grown 194 percent to $2.8 billion and is seven years behind.

The report said the FAA needed to reassess the benefits and timing of each project given the cost increases, the delays and cuts in congressional funding for equipment purchases. If the expected benefits justified the project, then the cash flow requirements needed to be determined and Congress advised of future funding requirements, the report said.

The FAA said it agrees with the recommendations and is setting realistic cost and performance schedules.

"We have made this effort a top priority for the FAA and its air traffic organization," said FAA spokesman Paul Takemoto.

The IG report said it was undecided whether FAA would reduce its operating costs through WAAS because the agency had yet to determine which surface navigation aids would be replaced in favor of WAAS and airliners already had similar capabilities.

The report said the cost of completing STARS remains uncertain and there is concern about aging controller displays at sites such as Chicago and Denver where replacement is not slated for several years.

Responding to the report, Raytheon said budget reductions had delayed deployment of STARS but the company had performed on schedule and cost for the past six years, delivering 75 systems to the FAA and 39 to military air traffic controllers.

The company also predicted airliners would gain advantages from WAAS through superior navigation from less expensive equipment.