O rder: 2014

- 1

- 21

Served: January 31, 2014



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 3 1 st of January , 20 1 4

ORDER REQUESTING PROPOSALS

Summary

By this O rder, the Department is requesting proposals from air ca rriers interested in providing

E ssential A ir S ervice (EAS) at Presque Is le /Houlton , Maine, (Presque Isle) and /or Plattsburgh,

New York

, for a new contract period beginning July 1, 201 4 , with or without subsidy

. (See

Appendix A for a map). Air c arriers should file their proposals no later than March 4, 2014

.

Background

By Or der 2012

- 3

- 2 (March 2, 2012 ), the Department selected Peninsula Airways, Inc.

(PenAir) to provide EAS at Presque Isle and Plattsburgh to Boston Logan International

Airport (Boston) using 34

- passenger Saab 340 aircraft , for a two

- year period beginning when

PenAir inaugurated service at both communities through the 24 th month thereafter

. 1 At

Presque Isle, PenAir provides 19 weekly round trips for a current annual subsidy rate of

$3,892,174, and at Plattsburgh, PenAir provides 12 weekly round trips for a curr ent annual

subsidy of $2,470,834. 2

The complet e public file for EAS at Presque Isle and Plattsburgh may be accessed online

through the Federal Dockets Management System at: www.regulations.gov by entering the

com munity’s respective docket number in the “Search for Rules, Comments, Adjudications,

or Supporting Documents” field.

1 PenAir commenced service at both communities on June 14, 2012

. 2 Under the same order, the Department selected carrier s to provide service to Bar Harbor, Maine. We will

address Bar Harbor’s service in a separate Order.

Essential Air Service at

PRESQUE ISLE /HOULTON , MAINE

PLATTSBURGH, NEW YORK

Under 49 U.S.C. § 41731 et seq

. Docket DOT

- OST

- 2000

- 8012

Docket DOT

- OST

- 2003

- 14783- 2

-

Request for Proposals

As the end of the current contract approaches, the Department is requesting proposals from air

carriers interested in providing EAS at Presque Isle and Plattsburgh

, with subsidy support if

necessary , for a new contract period beginning July 1, 201 4

. Carriers should file their

proposals no later than March 4, 2014

. Staff will the n docket the proposals, thereby making

them public

. Shortly afterwards, we will provide a summary of the proposals to the

communit y and ask them to submit their final comments. We will give full consideration to

all proposals that are timely filed. 3

Interested air carriers should prepare the ir proposals with every expectation that their initial

proposals will represent their final and only proposals. However, we retain the discretion to

negotiate proposals with carriers when we deem it desirable; in such cases, of course, we will

give all ap plicants the same opportunity. We also retain the discretion to reject outright all

unreasonable or unrealistic proposals and re

- solicit a new round of proposals. However,

negotiation and rejection are only occasional exceptions to the rule.

We are here providing interested carriers with some basic information to serve as guidance

when they prepare their proposals, but we will not prescribe a precise format for their

proposals. Air carrier proposals should be submitted to the Department with all materia ls

merged into a single document. In addition, because the document will be published on

Regulations.gov, each page should be formatted to be viewed online. We expect proposals to

adequately describe the service being proposed and the annual amount of su bsidy being

requested. The applicants can make their own judgments as to the level of detail they wish to

present; however, we would recommend that they include information concerning proposed

schedules and projected block hours . In add ition, applicants are urged to provide financial

data supporting their subsidy requests, including information on their projected expenses and

revenues. We strongly encourage clear, well

- documented proposals that will facilitate their

evaluation by the affected communit ies and the Department. 4

Proposals should provide sufficient capacity to accommodate historical levels of traffic. In

order to assist air carriers in developing traffic and revenue projections for their proposals, we

3 Carriers should not expect the Department to accept late filings. In cases where a carrier proposes to provide

EAS without subsidy and we determine tha t basic EAS, as required by 49 U.S.C. § 41732, can be reliably

provided without such compensation, we typically will not proceed with the carrier

- selection case. Instead, we

simply rely on that carrier’s subsidy

- free service as proposed.

4 In selecting a carrier to provide subsidized EAS for an eligible place not in Alaska , 49 U.S.C. § 41733(c) (1)

directs us to consider five factors: (a) service reliability; (b) contractual and marketing arrangements with a

larger carrier at the hub; (c) interline arrange ments with a larger carrier at the hub; (d) community views, giving

substantial weight to the views of the elected officials representing the users; and (e) whether the carrier has

included a plan in its proposal to market its service to the community. In addition, the Consolidated

Appropriations Act, 2014, Public Law No. 113

- 76, provides that when selecting a carrier to provide EAS, the

Department may consider the relative subsidy requirements, thus codifying a factor that we have considered since

the inc eption of the program. Interested carriers should also be aware that our general provisions governing

Essential Air Service will be included in the selection Order as part of our authorization of subsidy for the

selected service. Appendix C of this Order contains those general provisions.- 3

-

have provided a summary of historical pa ssengers in Appendi x B. During the year ended

September 30

, 2013, Presque Isle averaged 35 enplanements per day and Plattsburgh averaged

24 enplanements per day

. For Presque Isle and Plattsburgh, t he Department expects proposals

to offer service to a lar ge

- or medium

- hub airport that provides numerous connecting

opportunities to the national air transportation system.

With respect to Presque Isle, under EAS statutes the community is guaranteed 67 seats per day

in each direction, which would work out to be two round trips each day using 34

- passenger

aircraft . However, due to the long stage length to Boston and other weight and/or operational

restrictions, PenAir’s Saab 340 aircraft are limited to an average of 28 to 30 passengers per flight on a year

- r ound basis. We therefore will accept proposals for up to 19 weekly round

trips using 30

- 34 passenger aircraft or 14 weekly round trips using 50 passenger regional jets.

We would also accept proposals for 24 weekly round trips using 19

- passenger aircraft

.

At Plattsburgh, we expect proposals for two round trips each weekday and weekend (12 a

week) using 30

- passenger or larger aircraft, or three round trips each weekday and weekend

(18 a week) using 19

- passenger aircraft.

Air c arriers are also welcome t o propose more than one service option, if they choose. T hey

also need not limit themselves to the se requirements if they envision other, potentially more

attractive service possibilities

-- different hubs or length of contract, for example

-- with

subsid y requirements that remain competitive.

Community Comments

The communities are welcome to submit comments at any time. We encourage prospective

app licants to contact the communities before they submit their proposals so that they ca n tailor

them to the c ommunities’ needs, as they will not be able to amend them after the due date. As

noted earlier, we will provide a summary of the proposals to the civic parties shortly after the

deadline for carrier proposals, and ask them to submit their final comments.

Other Carrier Requirements

The Department is responsible for implementing various Federal statutes governing lobbying

activities, drug

- free workplaces, and nondiscrimination. 5 Consequently, all carriers receiving

Federal subsidy for EAS must certify that they are in compliance with Department regulations

regarding drug

- free workplaces and nondiscrimination, and those carriers whose subsidies

exceed $100,000 over the life of the contract must also certify that they are in compliance with

the regulations go verning lobbying activities. Because the Department is prohibited from

paying subsidy to carriers that do not submit these documents, all carriers that plan to submit

5 The regulations applicable to these areas are: (1) 49 CFR Part 20

-- New Restrictions on Lobbying;

(2) 49 CFR Part 21

-- Nondiscrimination in Federally

- Assisted Programs of the Department of Transportation

-- Effectua tion of Title VI of the Civil Rights Act of 1964; (3) 49 CFR Part 27

-- Nondiscrimination on the Basis of

Disability in Programs and Activities Receiving or Benefiting from Federal Financial Assistance; (4)

14 CFR Part 382

-- Nondiscrimination on the Basis of Disability in Air Travel; and (5) 49 CFR Part 29

--
Government

- Wide Debarment and Suspension (Non

- Procurement) and Government

- Wide Requirements for

Drug

- Free Workplace (Grants).- 4

-

proposals involving subsidy should be aware that the selected carrier will be required t o complete the required certifications. Interested carriers requiring more detailed information

regarding these requirements should contact the Offic e of Aviation Analysis at

(202) 366

- 5903. 6

This Order is issued under authority delegated in 49 CFR Part 1.25a(b) and re

- delegated to the

Director, Office of Aviation Analysis.

ACCORDINGLY,

1. We request that carriers interested in providing Essential Air Service at Presque

Isle /Houlton , Maine, and /or Plattsburgh, New York, submit their proposals, with subs idy

support if necessary , no later than March 4, 2014 . The proposals should be e

- mailed to:

michael.f.martin@dot.gov with the title “Proposal to Provide E AS at Presque Isle

and/or Plattsburgh ”; 7

2. Th ese d ocket s will remai n open until further O rder of the Department; and

3 . We will serve copies of this O rder on the mayor s of Presque Isle, Maine

, and Plattsburgh,

New York , the airport director of Northern Maine Regional Airport

, the airport manager of

Plat tsburgh International Airport, and the service list for this docket.

Persons entitled to petition the Department for review of this Order under the Department’s

Regulations, 14 CFR Part 385.31(a), must file such petitions within seven (7) days after the

d ate of service of this Order.

This Order will be effective immediately, and the filing of a petition for review shall not

preclude its effectiveness.

By:

TODD M. HOMAN

Director

Office of Aviation Analysis

(SEAL)

An electronic version of this documen t is available

o nline at www.regulations.gov

.

6 The certifications are also available on the web at http://www.dot.gov/policy/aviation

- policy/small

- community

rural

- air

- service/essential

- air

- service

. 7 Questions regarding filings in response to this O rder may b e directed to Michael Martin at (202) 366

- 6494 or michael.f.martin@dot.gov

.Appendix A

AREA MAP

Maps generated by the Great Circle Mapper

- copyright © Karl L. Swart z

.Ap pendix B

Page 1 of 2

Presque Isle/Houlton, Maine

Quarter Year Deplanements Enplanements Total Traffic Enplanements per

Day

4 2009 3,169 3,291 6,460 41

1 2010 3,161 3,233 6,394 42

2 2010 3,720 3,567 7,287 47

3 2010 4,301 4,353 8,654 55

Annual

Totals 14,351 14,444 2 8,795 46

4 2010 3,716 3,803 7,519 48

1 2011 2,930 3,099 6,029 39

2 2011 3,659 3,272 6,931 44

3 2011 4,038 4,133 8,171 52

Annual

Totals 14,343 14,307 28,650 46

4 2011 3,413 3,529 6,942 44

1 2012 2,944 3,168 6,112 40

2 2012 3,659 3,340 6,999 45

3 2012 3,208 3,286 6,494 41

Annual

Totals 13,224 13,323 26,547 42

4 2012 2,273 2,364 4,637 29

1 2013 2,209 2,333 4,542 29

2 2013 2,848 2,596 5,444 35

3 2013 3,584 3,593 7,177 45

Annual

Totals 10,914 10,886 21,800 35Appendix B

Page 2 of 2

Plattsbur gh, New York 1

Quarter Year Deplanements Enplanements Total Traffic Enplanements per

Day

4 2009 1,392 1,487 2,879 18

1 2010 1,287 1,340 2,627 17

2 2010 1,498 1,607 3,105 20

3 2010 4,146 4,334 8,480 54

Annual

Totals 8,323 8,768 17,091 27

4 201 0 3,572 3,617 7,189 46

1 2011 2,758 2,819 5,577 36

2 2011 2,574 2,561 5,135 33

3 2011 3,028 3,054 6,082 38

Annual

Totals 11,932 12,051 23,983 38

4 2011 2,267 2,325 4,592 29

1 2012 2,254 1,898 4,152 27

2 2012 1,494 1,432 2,926 19

3 2012 1,75 6 1,628 3,384 21

Annual

Totals 7,771 7,283 15,054 24

4 2012 1,648 1,612 3,260 21

1 2013 1,570 1,558 3,128 20

2 2013 1,918 1,785 3,703 24

3 2013 2,375 2,282 4,657 29

Annual

Totals 7,511 7,237 14,748 24

1 Data reflects EAS passengers only.Appendix C

Example of General Terms and Conditi ons for Essential Air Service

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 fo r 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 signif icant 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 these rates, it must first notify the Office of Aviation Analys is 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 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 complete, terminates or reduces payments for

service or changes service requ irements 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 specif ic 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 reduction or ce ssation of payment.

Funds may not be available for performance under this Order beyond [DATE]. The Government’s

obligation for performance under this Order beyond [DATE], is subject to the availability of 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 [DATE], until funds are made

available to the Department for performance. If sufficient funds are not made available for

performance beyo nd [DATE] , the Department will provide notice in writing to the carrier.

Subsidy contracts 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, r egulations, or

amendments thereto shall not operate to controvert the foregoing paragraph.

All claims for payment, including any amended cl aims, must be submitted within 9 0 days of the last

day of the month for which compensation is being claimed. For ex ample, claims for service provided

in July must be filed by October 31 st ; August claims must be submitted by November 30 th , and so on.