Lockheed Martin is looking for a 10-percent increase in the fees it's being paid to take over flight services. According to a report from the Department of Transportation's Office of Inspector General, the company, which was awarded a $1.8 billion contract to assume the function, says it's owed another $177 million, mostly because the FAA didn't supply accurate labor cost information. Lockheed Martin's claims are now being assessed. Meanwhile, the DOT OIG also reported that the FAA has fined Lockheed Martin $9 million for failure to live up to service and performance guarantees. Pilots in the Washington, D.C., area have recently complained that FSS changes have resulted in a sharp increase in dropped flight plans and that briefers, some of whom were in California, didn't know the procedures for operations in the Air Defense Identification Zone (ADIZ) that surrounds the capital. The OIG is now preparing a report on FSS operations that will be released later this month. Most of the OIG report delivered Thursday dealt with the FAA's funding request for 2008. The OIG noted the FAAs funding request has been tailored to fit the new user-fee-based structure being championed by the agency. The OIG doesn't pass judgment on the user-fee structure, but it does say the agency has become noticeably better at managing its money, particularly with regard to large capital projects. It says the agency seems to have curbed the runaway budgets and slipped schedules that plagued projects, but notes it has challenges ahead with the Next Generation Air Transportation System and more mundane projects like an integrated communications system.