### Order 2012

- 10

- 8 Served: October 4, 2012



### UNITED STATES OF AMERICA
DEPARTMENT OF TRANSPORTATION


### OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 4 th of October, 2012

Essential Air Service at

Fort Dodge, Iowa Mason City, Iowa Sioux City, Iowa Waterloo, Iowa Bemidji, Minnesota Brainerd, Minnesota Chisholm/Hibbing, Minnesota International Falls, Minnesota Thief River Falls, Minnesota

Devils Lake, North Dakota Jamestown, North Dakota Aberdeen, South Dakota Pierre, South Dakota Watertown, South Dakota

Under 49 U.S.C. 41731 et seq

. D ocket DOT

- OST

- 2001

- 10682

D ocket DOT

- OST

- 2001

- 10684

D ocket DOT

- OST

- 2011

- 0131

D ocket DOT

- OST

- 2011

- 0132

D ocket DOT

- OST

- 2011

- 0134

D ocket DOT

- OST

- 2011

- 0135

D ocket DOT

- OST

- 2003

- 15796

D ocket DOT

- OST

- 2009

- 0304

D ocket DOT

- OST

- 2001

- 10642

D ocket DOT

- OST

- 1997

- 2785

D ocket DOT

- OST

- 1997

- 2785

D ocket DOT

- OST

- 2011

- 0137

D ocket DOT

- OST

- 2011

- 0138

D ocket DOT

- OST

- 2001

- 10644

ORDER SETTING FINAL RATES

On July 1 5 , 20 11, Pinnacle Airlines Corporation and Mesaba Aviation, Inc., d/b/a Delta

Connection (Delta), 1 filed 90

- day notices of intent to suspend their subsid ized Essential Air

Service (EAS) at the 14 above

- captioned communities, e ffective October 1 3, 2011

. 2 By

1 The notice s w ere filed by Pinnacle’s two wholly

- owned subsidiaries, Mesaba Aviation, Inc., and Pinnacle Airlines, both doing business as Delta Connection. The code

- share parent, Delta Air Lines , Inc., volunteered to take on this EAS obligation itself, rather than Pinnacle or Mesaba

. Delta Air Lines indicate d that it would meet that obligation by requiring various code share partners, including Pinnacle, Atlantic Southeast, SkyWes t, Mesaba, or Chautauqua, to provide the service, depending on availability of aircraft and other considerations . This would afford Delta Air Lines

the maximum flexibility to meet its obligations. Hereafter Delta refers interchangeably to all of the airl ines at issue.

2 Delta simultaneously filed notice at 10 other communities , whose past

- periods have been resolved: Orders

2012

- 1

- 23, January 26, 2012, Butte; 2012

- 4

- 6, April 4, 2012, Greenville, Hattiesburg, Muscle Shoals, and Tupelo;

2012

- 4

- 10, April 6, 2012, Pellston and Sault Ste. Marie; 2012

- 4

- 20, April 16, 2012, Alpena, Escanaba, and Iron

Mountain. This order addresses the past

- period and prospective rates at only these 14 communities.- 2

-

Order 20 11

- 9

- 5

, September 13, 2011, we requir ed Delta to continue to maintain EAS and requested proposals at the communities “consistent with the level we are currently subsidizing. ” That level was 14 round trips per week except at Hibbing, where we had selected Delta to provide 19 round trips per week, and at Thief River Falls, where 12 round trips were required. By Order 2011

- 12

- 25, December 29, 2011, we reduced the required frequency at all of the

communities to twelve round trips per week, the minimum level of frequency permitted by

statute , because the 50

- seat regional jet s Delta had begun providing after it filed notice provided significantly more capacity than the 34

- seat Saab 340 aircraft specified by the various selection

Orders shown in the chart below.

T he chart below shows, for each community, the selection Order in effect when Delta filed
notice, 3 the subsequent replacement Order selecting a new carrier, 4 the eligible rate period, 5 t he level of subsidy Delta requested and what it ultimately agreed to , and finally the difference

between the two

. The chart below sets off Devils Lake/Jamestown and Hibbing/Thief River

Falls and International Falls from the other communities because servi ce at those f ive communities was provided , for at least some time, on a linear basis, while the service above was provided on a nonstop basis.

3 Sioux City, Waterloo, Bemidji, Brainerd, Aberdeen, and Pierre were served on a subsidy

- free basis, so no o rder is

shown.

4 No replacement order is shown at Pierre. Order 2012

- 1

- 7, J an uary 10, 2012, indicated that Delta’s eligible period

would end when Gr eat Lakes began subsidy

- free service to Minneapolis, which it did on February 1 , 2012. Jamestown shows twice in the chart above, because Order 2011

- 12

- 6, December 14, 2011, split service at Devils Lake from Jamestown, and Order 2012

- 1

- 17, January 23, 2012 , ultimately selected Great Lakes at Jamestown only. Likewise, International Falls shows twice as well.

5 Except for Brainerd and International Falls, replacement service has already begun. Order 2012

- 9

- 11

, September 11 , 2012, selected SkyWest to provide subsidized EAS at Brainerd and International Fall s , but SkyWest has not yet begun that service. Thus the hold

- in rate is effective from October 13, 2011, thru “UFN

, ” meaning until

fu rt her notice, i.e., when SkyWest inaugurates that service. Estimated Subsidy Based on Historical Regional Jet Operations Only

Selection Replacement Eligible Period Community Order Order From Thru Delta Agreed Difference Fort Dodge 2011-6-7 2011-11-30 1-Nov-11 11-Apr-12 $1,638,627 $1,168,744 $469,883
Mason City 2011-6-7 2011-11-30 1-Nov-11 11-Apr-12 $2,171,684 $1,196,087 $975,597
Sioux City NA 2011-12-2 13-Oct-11 3-Apr-12 $722,123 $343,635 $378,488

Waterloo NA 2011-12-2 13-Oct-11 3-Apr-12 $1,314,736 $591,045 $723,691
Bemidji NA 2012-1-23 13-Oct-11 2-Mar-12 $888,808 $429,364 $459,444

Brainerd NA 2012-9-11 13-Oct-11 14-Dec-12 $2,077,989 $2,070,454 $7,535

International Falls 2010-5-18 2012-9-11 11-Jan-12 4-Sep-12 $987,112 $987,112 $0

Jamestown 2009-8-6 2012-1-17 11-Dec-11 17-Mar-12 $1,374,875 $996,130 $378,745

Aberdeen NA 2012-1-23 13-Oct-11 2-Mar-12 $517,246 $178,137 $339,109

Pierre NA NA 21-Nov-11 31-Jan-12 $523,520 $473,114 $50,406

Watertown 2011-6-6 2011-11-30 1-Nov-11 3-Apr-12 $1,960,373 $1,034,083 $926,290

Devils Lake/ 2009-8-6 2011-12-6 1-Oct-11 10-Dec-11 $242,559 $190,828 $51,731

Jamestown 2009-8-6 2012-1-17 1-Oct-11 10-Dec-11 $242,559 $190,828 $51,731
Hibbing/ 2009-8-8 & 2012-4-10 1-Nov-11 17-May-12 $1,113,102 $1,379,684 -$266,582

Thief River Falls 2010-12-9 2011-11-30 1-Nov-11 17-May-12 $1,113,102 $1,379,684 -$266,582

International Falls 2010-5-18 2012-9-11 5-Sep-12 14-Dec-12 $275,077 $275,077 $0
$4,279,486- 3

-

All of the rates in the chart above , except for the linear service at Devils Lake and Jamestown during the initial period October 11, 2011, through December 10, 2011, reflect service with regional jet aircraft. At Brainerd and International Falls, D elta anticipates it will be replaced on De cember 15, 2012 , and the chart reflect s that assumption. However, Delta would continue to be compensated at the agreed rates if replacement service does not materialize.

T he suspension notices were precipitated by Delta planning to and ultimately dispo s ing

of its fleet of 34

- seat Saab 340 aircraft . However, the bulk of the EAS during the periods at issue was provided with 50

- seat regional jets

. In order to simplify matters

, Delta and the EAS staff agreed to exclude the operations of any Saab 340 aircr aft

– flights, revenue, and expenses

-- and to base the subsidy per flight exclusively on the expenses and revenue of regional jet operations . The applicable weekly ceilings were then determined by multiplying those subsidy rates for regional jets by the ceiling number of flights required by Order 2011

- 9

- 5 and Order 2011

- 12

- 25

. 6

Several factors drove t he subsidy decreases shown in the chart from those which Delta first proposed . First, Delta and the EAS staff agreed to base unit costs on those previously agreed to at the Memphis hub by Order 2012

- 4

- 6, April 4, 2012

, increased for expenses, such as deicing, to reflect the greater cost of operating during the mostly winter

months at the upper Midwest communities at issue here

. 7 In sum, we find th at the subsidy rates reflected in the Appendices appear reasonable.

This order is issued under authority delegated in 49 CFR Part 1.56a(f).

A CCORDINGLY ,

1. We set the final rates for Delta Air Lines, Inc., for meeting its obligation to provide

EAS at Fort Dodge, Mason City, Sioux City, and Waterloo, Iowa; Bemidji, Brainerd, Chisholm/Hibbing, International Falls, and Thief River Falls, Minnesota; Devils Lake and Jamestown, North Dakota; and Aberdeen, Pierre, and Watertown, South Dakota

, as descri bed in Appendices B , C, and D ;

2. These rates are in lieu of, and not in addition to, those set by Order s 2009

- 8

- 6,
2009

- 8

- 8, 2010

- 5

- 18, 2010

- 12

- 9, 2011

- 6

- 6, and 2011

- 6

- 7 , and 2012

- 9

- 11 ;

6 When Delta bills the Department, it will be able to apply those rates for 50

- seat aircraft to any service it provided with Saab 340 aircraft, pro

- rated on the number of seats, i.e., 34 out of 50.

7 In other words, the agreed unit costs are lower than what Delta origi nally proposed for these communities but higher than it agreed to at Memphis.- 4

-

3 . We direct Delta Air L ines, Inc., and its code

- share partners that actually provided the service, to retain all books, records, and other source and summary documentation to support claims for payment and to preserve and maintain such documentation in a manner that readily permits the audit and examination by representat ives of the Department. Such documentation shall be retained for seven years from the service date

of this O rder, or until the Department indicates that the records may be destroyed, whichever comes first. Copies of flight logs for aircraft sold or disposed of must be retained. The carrier may forfeit its compensation for any claim that is not supported

under the te rms of this order;

4 . These Dockets will remain open until further Department action; and

5 . The Department will serve copies of this O rder on Mesaba Aviation, Inc., Pinnacle Airlines Corporation, and Delta Air Lines, Inc.

By:

Susan Kurland

Assista nt Secretary for

Aviation and International Affairs (SEAL)

An electronic version of this document is available on the World Wide Web at http://www.regulations.govAppendix A

Nonstop Great Circle Miles to MSP Other Distances Fort Dodge, Iowa, FOD 168 HIB

- TVF 163 Mason City, Iowa, MCW 119 DVL

- JMS 83 Sioux City, Iowa, SUX 233 INL

- HIB 86 Waterloo, Iowa, ALO 166 Bemidji, Minnesota , BJI 199 Brainerd, Minnesota, BRD 114 Hibbing, Minnesota, HIB 174 International Falls, Minnesota, INL 255 Thief River Falls, Minnesota, TVF 261 Devils Lake, North Dakota, DVL 351 Jamestown, North Dakota, JMS 299 Aberdeen, South Dakota, ABR 257 Pierre, South Dakota, PIR 350 Watertown, South Dakota, ATY 193Appendix B
Page 1 of 11

Essential Air Service Provided at ABR (Aberdeen), ALO (Waterloo), ATY (Watertown), BJI (Bemidji),
FOD (Fort Dodge), JMS (Jamestown), MCW (Mason City), PIR (Pierre), and SUX (Sioux City)
Only Communities with Nonstop Turnaround Service

ABR ALO ATY BJI FOD JMS 2/ MCW PIR SUX

Docket 2011-0137 2011-0132 2001-10644 2011-0134 2001-10682 1997-2785 2001-10684 2011-0138 2011-0131
Nonstop Miles to MSP 257 166 193 199 168 299 119 350 233
Eligible Time Period 10-13-3/2 10/13-4/3 11/1-4/3 10/13-3/2 11/1-4/11 12/11-3/17 11/1-4/11 11/21-1/31 10/13-4/3
Replacement Order 2012-1-23 2011-12-2 2011-11-30 2012-1-23 2011-11-30 2012-1-17 2011-11-30 3/ 2011-12-2
Aircraft Type 1/ CRJ-200 CRJ-200 CRJ-200 CRJ-200 CRJ-200 CRJ-200 CRJ-200 CRJ-200 CRJ-200

Flts, both directions 548 638 415 513 463 333 563 122 635

Blk. Hours 626 567 420 502 467 406 464 153 714

Seats 27,555 29,500 20,750 25,650 23,199 16,649 28,150 6,100 31,905

Pax. 20,711 16,634 6,390 16,260 8,192 4,044 8,188 983 23,839
Imputed Pax. Fare $101.29 $92.73 $82.53 $89.03 $67.48 $105.96 $70.34 $150.94 $96.27

Pax Revenue $2,097,884 $1,542,531 $527,346 $1,447,614 $552,799 $428,495 $575,966 $148,378 $2,294,902

Other Revenue $257,346 $194,566 $64,437 $183,386 $68,001 $52,390 $70,162 $17,805 $287,679

Total Revenue $2,355,230 $1,737,097 $591,783 $1,631,000 $620,800 $480,885 $646,128 $166,183 $2,582,581

Direct Expenses $1,588,544 $1,438,825 $1,065,796 $1,273,880 $1,185,064 $1,030,269 $1,177,451 $466,181 $1,811,854

Indirects $824,186 $778,453 $482,648 $688,371 $519,264 $376,412 $577,039 $142,673 $975,018

Operating Expense $2,412,730 $2,217,278 $1,548,444 $1,962,251 $1,704,328 $1,406,681 $1,754,490 $608,854 $2,786,872

Economic $2,533,367 $2,328,142 $1,625,866 $2,060,364 $1,789,544 $1,477,015 $1,842,215 $639,297 $2,926,216
Subsidy per Above $178,137 $591,045 $1,034,083 $429,364 $1,168,744 $996,130 $1,196,087 $473,114 $343,635 $ per Departure $325.07 $926.40 $2,491.77 $836.97 $2,524.29 $2,991.38 $2,124.49 $3,877.98 $541.16

Weekly Ceiling, 2011 $9,102 $25,939 $69,770 $23,435 $70,680 $83,759 $59,486 $93,072 $15,152
Weekly Ceiling, 2012 $7,802 $22,234 $59,802 $20,087 $60,583 $71,793 $50,988 $93,072 $12,988

1/ Delta, in fact, provided some service with Saab 340 Turboprops, but the operations above only reflect service with Regional Jets.

Eligible service provided with Saab 340s will be billed at 34/50 of the regional jet subsidy rate.

The rates above were devleoped based on Delta's unit costs previously agreed to for the Memphis hold-ins.

Maintenance costs were increased slightly, and aircraft costs more significantly, to reflect the increased costs of operating during the

off-peak season in MSP. Delta separately developed subsidy costs for operations with both aircraft types, but after review,

it was agreed that to simplify matters by basing the above rates on the RJ operations, and we determined that would provided a reasonable result.

2/ See Appendix C for the linear service Delta provided on the routing DVL-JMS-MSP from October 1, 2011, through December 10, 2011.

3/ Order 2011-9-5, September 13, 2011, allowed Delta to terminate service. Order 2011-11-14, November 2, 2011, required Delta to reinstate

service, and order 2012-1-7, January 10, 2012, allowed Delta to terminate service once Great Lakes began Pierre to Minneapolis service.

Note: Unit costs shown above do not apply to Pierre, where the carrier was ordered back into service on an emergency basis.Appendix B Page 2 of 1 1

Subsidy Rate Agreement for the Provision of Essential Air Service by Delta Air Lines, Inc.

, at Aberdeen (ABR) , South Dakota, Docket 20 11

- 0137

SERVICE : Nonstop to Minneapolis ( MSP )

AIRCRAFT TYPE: CRJ

- 200

, 50 seats

TIMING OF FLIGHTS: Flights must be well

- timed and well

- spaced to ensure full compensation.

October 13 , 2011 January 1, 2012 December 31, 2011 March 2, 2012

WEEKLY ROUND TRIPS 14 12

RATE PER CRJ FLIGHT: 1 $ 325 $ 325

RATE PER SAAB FLIGHT 2 $221 $221

WEEKLY CEILING: $ 9,100 3 $ 7,800 4

Note: Order 2011

- 12

- 25, December 29, 2011 , reduced the required frequency from 14 round trips per week per Order 2011

- 9

- 5 to 12 , which Delta began providing on January 1, 2012.

1 See Appendix B, page 1 of 11.

2 $325 * 34/50 = $221.

3 $325 * 28 flights per week.

4 $325 * 24 flights per week.Appendix B Page 3 of 1 1

Subsidy Rate Agreement for the Provision of Essential Air Service by

Delta Air Lines, Inc., at Waterloo (ALO), Iowa, Docket 20 11

- 013 2

SERVICE: Nonstop to Minneapolis ( MSP )

AIRCRAFT TYPE: CRJ

- 200, 50 seats

TIMING OF FLIGHTS: Flights must be well

- ti med and well

- spaced to ensure full compensation.

October 13 , 2011 January 1, 2012 December 31, 2011 April 3 , 2012

WEEKLY ROUND TRIPS 14 12

RATE PER CRJ FLIGHT: 1 $ 926 $ 926

RATE PER SAAB FLIGHT: 2 $630 $630

WEEKLY CEILING: $ 25,92 8 3 $ 2 2,224 4

Note: Order 2011

- 12

- 25, December 29, 2011, reduced the required frequency from 14 round trips per week per Order 2011

- 9

- 5 to 12 , which Delta began providing on January 1, 2012.

1 See Appendix B, page 1 of 11.

2 $926 * 34/50 = $630.

3 $926 * 28 flights per week.

4 $926 * 24 flights per week.Appendix B Page 4 of 11

Subsidy Rate Agreem ent for the Provision of Essential Air Service by Delta Air Lines, Inc., at Watertown (ATY), South Dakota, Docket 20 01

- 10644

SERVICE: Nonstop to Minneapolis ( MSP )

AIRCRAFT TYPE: CRJ

- 200, 50 seats

TIMING OF FLIGHTS: Flights must be well

- timed and well

- spaced to ensure full compensation.

November 1 , 2011 January 1, 2012 December 31, 2011 April 3 , 2012

WEEKLY ROUND TRIPS 14 12

RATE PER CRJ FLIGHT: 1 $ 2,492 $ 2,492

RATE PER SAAB FLIGHT 2 $1,695 $1,695

WEEKLY CEILING: $ 69,776 3 $ 59,808 4

Note: Order 2011

- 12

- 25, December 29, 2011, reduced the required frequency from 14 round trips per week per Order 2011

- 9

- 5 to 12 , which Delta began providing on January 1, 2012.

1 See Appendix B, page 1 of 11.

2 $2,492 x 34/50.

3 $2,492 * 28 flights per week.

4 $2,492 * 24 flights per week.Appendix B Page 5 of 1 1

Subsidy Rate Agreement for the Provisio n of Essential Air Service by Delta Air Lines, Inc., at Bemidji (BJI), Minnesota, Docket 20 11

- 0134

SERVICE: Nonstop to Minneapolis ( MSP )

AIRCRAFT TYPE: CRJ

- 200, 50 seats

TIMING OF FLIGHTS: Flights must be well

- timed and well

- spaced to ensure full

comp ensation.

October 13 , 2011 January 1, 2012 December 31, 2011 March 2, 2012

WEEKLY ROUND TRIPS 14 12

RATE PER CRJ FLIGHT: 1 $ 837 $ 837

RATE PER SAAB FLIGHT 2 $569 $569

WEEKLY CEILING: $ 23,436 3 $ 2 0,088 4

Note: Order 2011

- 12

- 25 , December 29, 2011, reduced the required frequency from 14 round trips per week per Order 2011

- 9

- 5 to 12 , which Delta began providing on January 1, 2012.

1 See Appendix B, page 1 of 11.

2 $837 * 34/50 = $569.

3 $837 * 28 flights per week.

4 $837 * 24 flights per week.Appendix B Page 6 of 11

Subsidy Rate Agreement for the Provision of Essential Air Service by

Del ta Air Lines, Inc., at Fort Dodge (FOD), Iowa, Docket 20 01

- 10682

SERVICE: Nonstop to Minneapolis ( MSP )

AIRCRAFT TYPE: CRJ

- 200, 50 seats

TIMING OF FLIGHTS: Flights must be well

- timed and well

- spaced to ensure full compensation.

October 13 , 2011 January 1, 2012 December 31, 2011 April 11 , 2012

WEEKLY ROUND TRIPS 14 12

RATE PER CRJ FLIGHT: 1 $ 2,524 $ 2,524

RATE PER SAAB FLIGHT 2 $1,716 $1,716

WEEKLY CEILING: $ 70,672 3 $ 60,576 4

Note: Order 2011

- 12

- 25, December 29, 2011, reduc ed the required frequency from 14 round trips per week per Order 2011

- 9

- 5 to 12 , which Delta began providing on January 1, 2012.

1 See Appendix B, page 1 of 11.

2 $2,524 * 34/50 seats.

3 $2,524 * 28 flights per week.

4 $2,524 * 24 flights per week.Appendix B Page 7 of 1 1

Subsidy Rate Agreement for the Provision of Essential Air Service by Delta Air Lines, Inc., at Jam estown (JMS), North Dakota, Docket 20 01

- 10684

SERVICE: Nonstop to Minneapolis ( MSP )

AIRCRAFT TYPE: CRJ

- 200, 50 seats

TIMING OF FLIGHTS: Flights must be well

- timed and well

- spaced to ensure full compensation.

December 11 , 2011 January 1, 2012

December 31 , 2012 March 17, 2012

WEEKLY ROUND TRIPS 14 12

RATE PER CRJ FLIGHT: 1 $ 2,991 $2,991

RATE PER SAAB FLIGHT 2 $2,034 $2,034

WEEKLY CEILING: $ 83,748 3 $71,784 4

Note: The period 10/1/11 through 12/10/11 when Jamestown was served together with Devils Lake is included in Appendix C. Order 2011

- 12

- 25, December 29, 2011, reduced the required frequency from 14 round trips per week per Order 2011

- 9

- 5 to 12 , which Delta began providing on January 1, 2012.

1 See Appendix B, page 1 of 11.

2 $2,9 91 * 34/50 seats.

3 $2,991 * 28 flights per week.

4 $2,991 * 24 flights per week.Appendix B Page 8 of 1 1

Subsidy Rate Agreement for the Provision of Essential Air Service by Delta Air Lines, Inc., at Mason City ( MCW ), Iowa

, Docket 20 01

- 106 84

SERVICE: Nonstop to Minneapolis ( MSP )

AIRCRAFT TYPE: CRJ

- 200, 50 seats

TIMING OF FLIGHTS: Flights must be w ell

- timed and well

- spaced to ensure full compensation.

November 1 , 2011 January 1, 2012 December 31, 2011 April 11 , 2012

WEEKLY ROUND TRIPS 14 12

RATE PER CRJ FLIGHT: 1 $ 2,124 $ 2,124

RATE PER SAAB FLIGHT 2 $1,444 $1,444

WEEKLY CEI LING: $ 59,472 3 $5 0,976 4

Note: Order 2011

- 12

- 25, December 29, 2011, reduced the required frequency from 14 round trips per week per Order 2011

- 9

- 5 to 12 , which Delta began providing on January 1, 2012.

1 See Appendix B, page 1 of 11.

2 $2,124 * 34/50 seats.

3 $2,124 * 28 flights per week.

4 $2,124 * 24 flights per week.Appendix B Page 9 of 1 1

Subsidy Rate A greement for the Provision of Essential Air Service by Delta Air Lines, Inc., at Pierre (PIR), South Dakota, Docket 20 11

- 0138

SERVICE: Nonstop to Minneapolis ( MSP )

AIRCRAFT TYPE: CRJ

- 200, 50 seats

TIMING OF FLIGHTS: Flights must be well

- timed and well

- spaced to ensure full compensation.

November 2 1 , 2011 January 31 , 201 2

WEEKLY ROUND TRIPS 1 2

RATE PER CRJ FLIGHT: 1 $ 3, 878

RATE PER SAAB FLIGHT 2 $2, 637

WEEKLY CEILING: $ 93,072 3

Note: Order 2011

- 9

- 5 allowed Delta to terminate its Pierre to Minneapolis service.

Order 2011

- 11

- 4 required Delta to reinstate twelve round trips per week , which the carrier did, effective November 21, 2011. Delta’s last day of service at Pierre was January 31, 2012, when it was replaced by Great Lakes’ subsidy

- free service.

1 See Appendix B, page 1 of 11.

2 $3,878 * 34/50 = $2, 061.

3 $3,878 * 24 flights per week.Appendix B Page 10 of 1 1

Subsidy Rate Agreement for the Provision of Essential Air Service by Delta Air Lines, Inc., at Sioux City (SUX), Iowa, Docket 20 11

- 0131

SERVICE: Nonstop to Minneapolis ( MSP )

AIRCRAFT T YPE: CRJ

- 200, 50 seats

TIMING OF FLIGHTS: Flights must be well

- timed and well

- spaced to ensure full compensation.

October 13 , 2011 January 1, 2012 December 31, 2011 April 3 , 2012

WEEKLY ROUND TRIPS 14 12

RATE PER CRJ FLIGHT: 1 $ 541 $ 541

RATE PER SAAB FLIGHT 2 $368 $368

WEEKLY CEILING: $ 15,148 3 $ 1 2,984 4

Note: Order 2011

- 12

- 25, December 29, 2011, reduced the required frequency from 14 round trips per week per Order 2011

- 9

- 5 to 12, which Delta began providing on January 1, 20 12.

1 See Appendix B, page 1 of 11.

2 $541 * 34/50 = $368.

3 $541 * 28 flights per week.

4 $541 * 24 flights per week.Appendix B Page 11 of 11

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significant elements of the required service, without prior approval. The carrier understands that an aircraft take

- off and landing at its scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligib ility for a flight that has not been completed, such as certain weather cancellations, only completed flights are considered eligible for subsidy. In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant period, it may jeopardize its entire subsidy claim for the period in question. If the carrier contemplates any such changes beyond the scope of the Order during the applicable period of this rate, it must first notify the Office of Aviation Analysis in writing and receive written approval from the Department to be ensured of full compensation. Should circumstances warrant, the Department may locate and select a replacement carrier to provide service on these routes. The carrier must complet e all flights that can be safely operated; flights that overfly points for lack of traffic will not be compensated. In determining whether subsidy payment for a deviating flight should be adjusted or disallowed, the Department will consider the extent to which the goals of the program are met and the extent of access to the national air transportation system provided to the community.

If the Department unilaterally, either partially or completely, terminates or reduces payments for service or changes serv ice requirements at a specific location provided for under this Order, then, at the end of the period for which the Department does make payments in the stipulated amounts or at the stipulated service levels, the carrier may cease to provide service to tha t specific location without regard to any requirement for notice of such cessation. Those adjustments in the levels of subsidy and/or service that are mutually agreed to in writing by the Department and carrier do not constitute a total or partial reducti on or cessation of payment.

Subsidy contract are subject to, and incorporate by reference, relevant statutes and Department regulations, as they may be amended from time to time. However, any such statutes, regulations, or amendments thereto shall not op erate to controvert the foregoing paragraph.

Funds are not currently available for performance under this Order beyond September 30, 2012. The Government’s obligation for performance under this Order beyond September 30, 2012, is subject to the availabil ity of appropriated funds from which payment for services can be made. No legal liability on the part of the Government for any payment may arise for performance under this Order beyond September 30, 2012, until funds are made available to the Department for performance. If funds are not made available for performance beyond September 30, 2012, the Department will provide notice in writing

to the carrier.

All claims for payment must be submitted within 60 days of the last day of service provided under th is Order.Appendix C Page 1 of 5

Essential Air Service Provided at Devils Lake and Jamestown, and Hibbing and Thief River Falls Communities with One-Stop Service

Devils Lake and Jamestown Hibbing Thief River Falls Hibbing Thief River Falls

JMS DVL Total HIB TVF HIB TVF

Docket 1997-2785 1997-2785 1997-2785 2003-15796 2001-10642 2003-15796 2001-10642 Round trips per Week to Hub 14 14 14 19 12 12 12 Nonstop Miles to MSP 299 351 174 261 174 261 Eligible Time Period 10/1-12/10 10/1-12/10 10/1-12/10 11/1-12-31 11/1-12-31 1/1--5/17 1/1--5/17

Selection Order 2009-8-6 2009-8-6 2009-8-6 2009-8-8 2010-12-9 2009-8-8 2010-12-9 Aircraft Type Saab 340 Saab 340 Saab 340 RJ RJ RJ RJ

Departures 361 178 539 282 190 481 428 MSP Deps/Ldgs. 1/ 271 286 0 493 0

Blk. Hours 324 115 439 284 166 439 346

Seats 7,588 6,052 13,640 11,556 8,044 24,153 21,504

MSP Seats 1/ 9,214 14,300 0 24,650 0
Passengers 2/ 3,332 1,825 5,157 4,392 828 10,339 2,162

MSP Pax. 1/ 3,650 3,564 0 8,177 0 Imputed Pax. Fare 2/ $98.87 $51.26 $83.06 $56.89 $82.52 $58.64

Pax Revenue $329,449 $93,557 $423,007 $364,802 $47,107 $853,166 $126,777

Other Revenue $39,769 $11,227 $50,995 $44,208 $5,653 $103,878 $15,374

Total Revenue $369,218 $104,784 $474,002 $409,010 $52,760 $957,044 $142,151

Direct Expeses $385,655 $137,109 $522,764 $720,681 $421,243 $1,113,961 $878,013

Indirects $292,147 $272,633 $68,611 $491,682 $147,777

Operating $814,911 $993,314 $489,854 $1,605,643 $1,025,790

Economic $855,657 $1,042,980 $514,347 $1,685,925 $1,077,080

Subsidy per Above $381,655 $633,970 $461,587 $728,881 $934,929
Subsidy per Community $190,828 $633,970 $461,587 $728,881 $934,929
Subsidy per Dep/ldg @ MSP $704 $2,217 $1,614 $1,478 $1,896
Weekly Ceiling $19,712 $84,246 $38,736 $35,472 $45,504
Annual Ceiling per Community $1,025,024 $4,380,792 $2,014,272 $1,844,544 $2,366,208

1/ MSP landings/departures and passengers for costing on MSP Station expense -- both passenger and departure related. MSP-passengers are the same
as O&D passengers, and are used for determining reservation expense; i.e., exclude flow passengers and intermediate stops for determining those costs.
2/ These reflect segment passengers and fares, i.e., DVL and TVF passengers are included in the JMS and HIB columns, respectively.
Similarly, the Jamestown passengers includes those passengers flowing from DVL over JMS.

Note: DVL/JMS service was operated linear and round robin midday, so we have combined the expenses and subsidy for each community.
However, HIB/TVF was strictly linear, so we have arbitrarily assigned all MSP-related expenses to HIB.Appendix C Page 2 of 5

Subsidy Rate Agreement for the Provision of Essential Air Service by Delta Air Lines, Inc., at Devils Lake (DVL) and Jamestown (JMS) , North Dakota, Docket 1997

- 2785

SERVICE: Nonstop or one

- stop to Minneapolis ( M SP )

AIRCRAFT TYPE: Saab 340, 34 seats

TIMING OF FLIGHTS: Flights must be well

- timed and well

- spaced to ensure full compensation.

Devils Lake Jamestown October 1, 2011 October 1, 2011

December 10 , 2011 December 10, 2011

WEEKLY ROUND TRIPS 14 14

RATE PER FLIGHT: 1 $ 704 $704

WEEKLY CEILING: 2 $ 19,712 $19,712

Note: Devils Lake and Jamestown were served together during this time period. Great Lakes replaced Delta at Devils Lake on December 1 0 , 2012, but Delta continued servin g Jamestown as shown in Appendix A through March 17, 2012.

1 See Appendix C, page 1 of 5.

2 $704 x 28 flights in either direction.Appendix C Page 3 of 5

Subsidy Rate Agreement for the Provision of Essential Air Service by Delta Air Lines, Inc., at Hibbing (HIB), Minnesota, Docket 2003

- 15796

SERVICE: Nonstop or one

- stop to Minneapolis ( MSP )

AIRCRAFT TYPE: CRJ

- 200, 50 seats

TIMING OF FLIGHTS: Flights must be well

- timed and well

- spaced to ensure full compensation.

November 1, 2011 January 1, 2012

December 31 , 2011 Ma y 1 7 , 201 2

WEEKLY ROUND TRIPS 19 12

R ATE PER CRJ FLIGHT: 1 $ 2,217 $ 1,478

RATE PER SAAB FLIGHT: $ 1,508 2 $1, 005 3

WEEKLY CEILING: $ 84,246 4 $ 35,472 5

Note: Order 2011

- 12

- 25, December 29, 2011, reduced the required frequency from 1 9 round trips per week per Order 2011

- 9

- 5 to 12, which Delta began providing on January 1, 2012.

1 See Appendix C, page 1 of 5.

2 $2,217 x 34/50 seats.

3 $1,478 x 34/50 seats.

4 $2,217 x 38 flights in either direction.

5 $1,478 x 24 flights in either direction.Appendix C Page 4 of 5

Subsidy Rate Agreement for the Provision of Essential Air Service by Delta Air Lines, Inc., at Thief River Falls (TVF), Minnesota, Docket 2001

- 10642

SERVICE: One

- stop to Minneapolis ( MSP )

AIRCRAFT TYPE: CRJ

- 200, 50 seats

TIMING OF FLIGHTS: Flights must be well

- timed and well

- spaced to ensure full compensation.

November 1, 2011 January 1, 2012

December 31 , 2011 May 1 7 , 201 2

WEEKLY ROUND TRIPS 12 12

RATE PER CRJ FLI GHT: 1 $ 1,614 $1,896

RATE PER SAAB FLIGHT: $ 1, 098 2 $1, 289 3

WEEKLY CEILING: $ 38,736 4 $ 45,504 5

Note: This rate increases between the two periods because in the earlier period more of the combined subsidy is assigned to Hibbing to reflect the 19 round trips per week required at Hibbing in the early period . We required 12 round trips per week at Thief River Falls throughout the hold

- in period

.

1 See Appendix B, page 1 of 5.

2 $1,614 x 34/50 seats.

3 $1,896 x 34/50 seats.

4 $1,614 x 24 flights in either direction.

5 $1,896 x 24 flights in either direction.Appendix C Page 5 of 5

Note: The carrier understands that it may forfeit its compensation for any flig hts that it does not operate in conformance with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significant elements of the required service, without prior approval. The carrier understands th at an aircraft take

- off and landing at its scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight that has not been completed, such as certain weather cancellations, only completed flights ar e considered eligible for subsidy. In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant period, it may jeopardize its entire subsidy claim for the period in question. If the carrier con templates any such changes beyond the scope of the Order during the applicable period of this rate, it must first notify the Office of Aviation Analysis in writing and receive written approval from the Department to be ensured of full compensation. Should circumstances warrant, the Department may locate and select a replacement carrier to provide service on these routes. The carrier must complete all flights that can be safely operated; flights that overfly points for lack of traffic will not be compensat ed. In determining whether subsidy payment for a deviating flight should be adjusted or disallowed, the Department will consider the extent to which the goals of the program are met and the extent of access to the national air transportation system provid ed to the community.

If the Department unilaterally, either partially or completely, terminates or reduces payments for service or changes service requirements at a specific location provided for under this Order, then, at the end of the period for which the Department does make payments in the stipulated amounts or at the stipulated service levels, the carrier may cease to provide service to that specific location without regard to any requirement for notice of such cessation. Those adjustments in the le vels of subsidy and/or service that are mutually agreed to in writing by the Department and carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract are subject to, and incorporate by reference, relevant statutes an d Department regulations, as they may be amended from time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds are not currently available for performance under this Order beyond September 30, 2012. The Government’s obligation for performance under this Order beyond September 30, 2012, is subject to the availability of appropriated funds from which payment for services can be made. No legal liability on the part of the Go vernment for any payment may arise for performance under this Order beyond September 30, 2012, until funds are made available to the Department for performance. If funds are not made available for performance beyond September 30, 2012, the Department will provide notice in writing to the carrier.Appendix D Page 1 of 4
Essential Air Service at Brainerd, MN, Docket 2011-0135

Brainerd International Falls 2/

Docket 2011-0135 2009-0304 2009-0304 Nonstop Miles to MSP (HIB) 114 255 86 Intermediate Stops None None Hibbing Eligible -- 10/13/2011 1/ 1/11/2012 9/5/2012

Time Period UFN 9/4/2012 UFN Aircraft Type CRJ-200 CRJ-200 CRJ-200
Flts, both directions 1,453 836 340

Blk. Hours 1,107 907 238

Seats 72,650 41,800 17,000

Pax. 32,619 21,753 5,083 Imputed Pax. Fare $76.41 $107.65 $107.66

Pax Revenue $2,492,528 $2,341,710 $547,230

Other Revenue $303,500 $282,267 $65,668

Total Revenue $2,796,028 $2,623,977 $612,898

Direct Expenses $2,809,134 $2,301,612 $603,952

Indirects $1,792,025 $1,137,520 $241,738

Operating Expense $4,601,159 $3,439,132 $845,690

Economic $4,831,217 $3,611,089 $887,975
Subsidy per Above $2,035,189 $987,112 $275,077 $ per Departure $1,401 $1,181 $809

Weekly Ceiling, 2011 (14 trips/week) $39,228 NA NA Weekly Ceiling, 2012 (12 trips/week) $33,624 $28,344 $19,416

1/ Delta began using only CRJ-200 equipment 12/15/11. The rate was constructed beginning that date, not from October 13, 2011, when Saab 340 aircraft still operated. 2/ The carrier introduced one-stop service over Hibbing on September 5. The Hibbing route is costed incrementally, i.e., revenue is taken all the way to MSP, station expenses are for International Falls only, other costs are strictly incremental. All claims for payment must be submitted within 60 days of the last day of service provided under this Order.Appendix D Page 2 of 4

Subsidy Rate Agreement for the Provision of Essential Air Service by

De lta Air Lines, Inc., at Brainerd, Minnesota (BRD) Docket 20 11

- 0135

SERVICE: Nonstop to Minneapolis ( MSP )

AIRCRAFT TYPE: CRJ

- 200, 50 seats

TIMING OF FLIGHTS: Flights must be well

- timed and well

- spaced to ensure full compensation.

October 13 , 201 1 January 1, 2012 December 31, 2011 UFN 1

WEEKLY ROUND TRIPS 14 12

RATE PER CRJ FLIGHT: 2 $ 1,401 $ 1,401

RATE PER SAAB 340 FLIGHT 3 $953 $953

WEEKLY CEILING: $ 39,228 4 $ 33,624 5

Note: Order 2011

- 9

- 5 required Delta to provide 14 round tr ips per week.

Order 2011

- 12

- 25, December 29, 2011, reduced the required frequency from 14 round trips per week per to 12

.

1 Delta anticipates it will be replaced on December 15, 2012

2 See Appendix D, page 1 of 4.

3 $1,401 * 34/50 seats = $953.

4 $1,401 * 28 flights per week.

5 $1,401 * 24 flights per week.Appendix D Page 3 of 4

Subsidy Rate Agreement for the Provision of Essential Air Service by Delta Air Lines, Inc., at In ternational Falls, MN (MSP) Docket 20 09

- 0304

Hub: Minneapolis ( MSP )

AIRCRAFT TYPE: CRJ

- 200, 50 seats

TIMING OF FLIGHTS: Flights must be well

- timed and well

- spaced to ensure full compensation.

Effective Period October 13 , 2011

-- September 5 , 2012

-- of Rate September 4 , 201 2 UFN 1

INTERMEDIATE STOPS None One

WEEKLY ROUND TRIPS 12 12

RATE PER CRJ FLIGHT: 2 $ 1,181 $ 809

RATE PER SAAB FLIGHT: 3 $803 $550

WEEKLY CEILING: $ 25,928 4 $ 22,224 5

Note: Order 2011

- 9

- 5 required Delta to provide 14 round trips per week.

Order 2011

- 12

- 25, December 29, 2011, reduced the required frequency from 14 round trips per week per to 12

.

1 Delta anticipates it will be replaced on December 15, 2012.

2 See Appendix D, page 2 of 4.

3 $1,181 * 34/50 = $803; $809 x 34/50 = 550..

4 $1,181 x 24 flights per week.

5 $809 * 24 flights per week.Appendix D Page 4 of 4

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significant elements of the required service, without prior approval. The carrier understands that an aircraft take

- off and landing at its scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight that has not been completed, such as certain weather cancellations, only completed flights are c onsidered eligible for subsidy. In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant period, it may jeopardize its entire subsidy claim for the period in question. If the carrier contem plates any such changes beyond the scope of the Order during the applicable period of this rate, it must first notify the Office of Aviation Analysis in writing and receive written approval from the Department to be ensured of full compensation. Should ci rcumstances warrant, the Department may locate and select a replacement carrier to provide service on these routes. The carrier must complete all flights that can be safely operated; flights that overfly points for lack of traffic will not be compensated. In determining whether subsidy payment for a deviating flight should be adjusted or disallowed, the Department will consider the extent to which the goals of the program are met and the extent of access to the national air transportation system provided to the community.

If the Department unilaterally, either partially or completely, terminates or reduces payments for service or changes service requirements at a specific location provided for under this Order, then, at the end of the period for which the Department does make payments in the stipulated amounts or at the stipulated service levels, the carrier may cease to provide service to that specific location without regard to any requirement for notice of such cessation. Those adjustments in the level s of subsidy and/or service that are mutually agreed to in writing by the Department and carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract are subject to, and incorporate by reference, relevant statutes and

D epartment regulations, as they may be amended from time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds are not currently available for performance under this Order be yond September 30, 2012. The Government’s obligation for performance under this Order beyond September 30, 2012, is subject to the availability of appropriated funds from which payment for services can be made. No legal liability on the part of the Gover nment for any payment may arise for performance under this Order beyond September 30, 2012, until funds are made available to the Department for performance. If funds are not made available for performance beyond September 30, 2012, the Department will pr ovide notice in writing to the carrier.

All claims for payment must be submitted within 60 days of the last day of service provided under this Order.