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# o US.DtpartrTWntO f l 20 0 Ne w Jerse yAvenufe , SE Transportatio n • •'!•- : Washington , O C 2059 0 Offic e o f th e Secretar

y ofTfansportatio n ' ' i ' i j ^- ' \ Q S Mayo r Eri c Bookmeye r

Apri l 14 , 201 1 1 0 Firs t Street , N W Maso n City , l A 5040 1 Dea r Mayo r Bookmeyer : Thi s lette r

i s regardin g essentia l ai r servic e (EAS ) a

t Maso n City . M y purpos e i n writin g i s to infor myou o f th e result s of

th e earners ' servic e an dsubsid y proposal s before w e submi t a recommendatio n o n th e carrier-selectio n issu e t o th e Assistan t Secretary fo

r Aviatio n an d Internationa l Affair s for

decision . A similar

lette r i s bein g sen t

t o Fori Dodge . A s you know . Orde r

2011-1-12 , Januar y 14 . 2011 , requeste dproposal s a t Fo n Dodg e an dMaso n City , wit h proposa l du e Marc h 1 . B y Notic e date dFebruary 11 , 2011 , w e extende dth e deadlin e fo r proposal s t o Apri l 5 , 2011 . I n respons e t o our

reques t for proposals , w e receive dproposal s fromMulti-Aero . Inc. , d/b/ aAi r Choic e One ; M^sab aAviation , Inc. , d/b/aDelt aConnection , andSeaPoi t Airlines . W e emaile d thos e proposal s t o th e parties , an dthe y can b e viewe da t th e Federa l Docke t

Managemen t System . hap://www.t-eiruhuions.£o v unde r DOT-OST-200 1 -10684 , s o I wil l onl y brietl y summariz e the mhere . Yo u may als o vie w asummar y o f eac h proposa l i

n th e attache d Appendi x A . Multi-Aer o All of Multi-Aero' s proposal s are for eithe r atwo-year

o r four-yea r period , wit

h afour-yea

r contrac t requirin g slightl y les s annua l subsidy . Al l o f th e proposal s contemplat e 30-seat aircraft , thoug h the y d o no t

specif y th e exac t

aircraf t typ e - presumabl y Embrae r Brasili ao r

Saa b 340 . Multi-Aer o doe s no t

currentl y hav e th e requisit e authorit y fromeithe r th e Federa l Aviatio n Administratio n o r

th e Departmen t

t o operat e 30-seat

aircraf t i n schedule dservice . Optio n 1 : Multi Aer o propose s 1 9 nonsto p rotmdtrip s per week t o Chicag o O'Hare . Th e carrie r

request s $2,789,22 4 annual subsid y for atwo-year

contract , an d$2,733,43 9 annual subsid y fo

r afour-yea

r contract . Optio n 2 : Mult

i Aer o propose s 1 4 nonsto p roun dtrip s per week t o Chicago . Th e carrie r request s $2,642,19 4 annua l subsid y fo r atwo-year

contract , and$2,589,35 0 annual subsid y for

afour-yea

r contract . Optio n 3 : Multi Aer o propose s 1 9 nonsto p roun dtrip s pe r wee k t o Minneapolis . Th e carrie r request s $2,686,17 7 annua l subsid y for atwo-year

contract , an d$2,632,45 3 annual subsid y fo

r afour-yea

r contract . Optio n 4 : Thi s optio n i s par t o f a n inseparabl e packag e wit h Maso n Cit y i

n whic h For

t Dodg e woul dreceiv e 1 4 nonsto p roun dtrip s pe r week to Chicago an dMaso n City woul dreceiv e 1 9 nonsto p roun dtrip s per wee k for acombine dannua l subsid y o f $5,456,09 9 fo

r tw o year s o r

$5,346,97 7 for

fou r years . However , th e leve l o f servic e propose dfor

Maso n Cit y exceed s programguideline s an dw e woul dno t selec t it , thu s leavin g thi s optio n moo t

for For t Dodg e a s wel l a s Maso n City .SeaPor t

Airline s Seaport propose s 2 8 nonsto p roun dtrip s pe r wee k t o Minneapoli s wit

h 9-seat Piiatu s PC-1 2 aircraft , asingle-engin e turbopro p aircraft . Th e carrie r request s $957,76 4 subsid y th e firs t yea r an d$1,003,30 6 subsid y th e secon dyear . Becaus e Maso n Cit y i s guarantee dservic e wit h twin

engine , 15-sea

t aircraft , SeaPort' s subsidized.proposa l coul dno t b e selecte dunles s th e community waive dit s righ t t o thos e standards . Mesab aAviation , Inc . Mesab apropose s onl y afive-month option , fro mJun e 1 throug h Octobe r 31 , an dwoul dcontinu e t o operat e 1 4 nonsto p roun dtrip s per wee k t o Minneapoli s with 34-seat Saab 34 0 aircraft . Th e carrie r request s $1,017,54 5 annua l subsid y for thi s leve l o f

service , whic h i

t revise ddownwar d fro mit s initia l proposa l afte r discussion s with th e staff . Mesab awoul doperat e a s Delt a Connection . Pleas e not e tha

t th e averag e passenge r

fare s i n th e carriers ' proposal s show n i n th e docke t

d o no t necessaril y reflec t

th e averag e loca l fare s passenger s woul dpay , but , rather , reflec t th e prorate d portio n o f th e total ticke t

price , e.g. , th e Maso n Cit y -Minneapoli s portio n o f aMaso n Cityt o Minneapoli s t o Ne w Yor k ticket . Also , th e fare show n i s ne t of certai n charge s suc h a s federal transportatio n securit y fees , excis e o r ticke t taxes , an dpassenge r

facility charges . O f

course , carrier s hav e th e discretio n t o charg e fare s the y dee mappropriate , an dth e passenge r fare s presente di

n thei r proposal s hav e bee n develope dfor subsid y rate computatio n purpose s only . Base do n th e cos t

element s incorporate di

n th e carriers ' computatio n summaries , th e carriers ' woul dhav e t o realiz e passenge r fare s comparabl e t o th e average s show n i n thei r proposal s i

n orde r t o achiev e break-eve n o r profitabl e operation s eve n wit h subsidy . Yo u shoul dals o not e that th e schedule s that

th e carrier s hav e submitte dan dthat ar e show n i

n th e docke t ar e illustrativ e only , an dthat eac h carrie r

may mak e schedul e change s t o reflec t changin g conditions , e.g. , t o bette r

mee t shiftin g connectin g ban k lime s a t th e hub(s) . Th e Departmen t expect s subsidize dai r

carrier s t o maintai n well-time dan dwell-space dflights i n orde r t o ensur e ful l compensation . We kno w thi s matte r

i s importan t

t o you an dw e wil l ac t

a s quickl y a s possibl e upo n receip t o f you r letter . I n orde r t o expedit e th e case , pleas e submi t you r comment s b y emai l t o EASCg'dot.go v b y May 3 . I f yo u hav e an y question s o r d o no t wis h t o submi t

forma l comments , pleas e contac t Kevi n Adam s a

t (202 ) 366-1047 . Sincerely ,

r / /£^-z^Ly'-'-^//- ^ ^Denni s J . DeVan y Chief , Essentia l Ai r

Service Divisio n Offic e o f Aviatio n Analysi s

cc : Mesaba , SeaPort , Multi-Aero , an dChautauqu aAppentli xA

Annua l Subbid yRale s a t Maso n City . Iowa . Docke i 2001-1068 4 Mulli-AtTo . d/b/ a Ai rChoic e On e 3 / Effectiv e Perio d Cod e Shar e Roun d Trips/Wee k Slop s Hu b Aircraf t Typ e Passenger

s Departure s Bloc k Hour s Passenge rRevenu e Tola ! Revenu e Tota l Direct s Tota l InHiren s Tota l Operatin g Profi t Economi c Cos t Annua l Subsid yRat e Mesab a 1 / Delt a 1 4 Nonsto p MS P Saa b 34 0 27.22 8 1.41 6 1,29 0 $1,574,35 0 $1,825,06 5 $1.5.15.85 4 $I.I71.JQ 4 $2,707,24 8 $1.15.36 2 $2,842,61 0 $1,017,54 5 Seapor t 2 / 1s t Yea r Non e 2 S Nonsto p MS P PC-1 2 22,00 0 2.83 2 I.S4 1 :i ^ 1.298.00 0 $1,310,98 0 $1.40.1,05 8 $757,65 1 $2,160,70 9 $108,03 5 .S2.268.74 4 $957,76 4 2n d Yea r

Non e 2 8 Nonsto p MS P PC-1 2 22.00 0 2.83 2 1,84 1 $1,298,00 0 $1,310,98 0 $1,431,22 2 $772,86 0 $2,204,08 2 $110,20 4 $2,314,28 6 $1,00 1 ..10 6 Optio n 1 2 year s Non e 1 9 Nonsto p OR D 10-Seale r 29.00 0 1.942 2,.15 0 $3,625,00 0 $3,697,50 0 $5,213,29 7 $964,53 5 $6,177,83 2 $308,89 2 $6,486,72 4 $2,789,22 4 Opiio n 2

2 year s Non e 1 4 Nonsto p OR D 3l)-Seate r 24.50 0 1.43 1 1.73 1 $2,401,00 0 $2,449,02 0 $3,970,18 5 $878,59 0 $4,848,77 5 $242,41 9 $5,091,21 4 $2,642,19 4 Optio n 3

2 year s Non e 1 9 N o n Slo p MS P 30-Seaie r 28.00 0 1,942 1.84 5 $1,080,00 0 53,141.60 0 S4,416.56 7 $1,13.1,69 7 $5,550,26 4 $277,51 3 $5,827,77 7 $2,686,17 7 Optio n 4

2 years Non e 1 9 Nonsio p OR D 30-Seale r

$3,141.39 0 4 / 1 / Jun e I , 2011 , ihroug h Octobe r31 , 20 1 I , i,e. . 5 months . Th e number s show n fo rMesab a ar e annualized , 2 / Seaport indicate s servic e woul d b e Jun e 20 1 I thoug h Ma y2013 , W e interpre t thi s t o mea n a two-yea rperiod . sinc e i t i s unlikel ytha t a carrie rtransitio n cou M h e conclude d b yJun e I 1 / Multt-Aer o offer s th e opiio n o f a 4-yea rcontract , i n whic h cas e i t woul d requir e les s subsidy , a s follows : Opiio n I . $2,733,439 ; Opiio n 2 , $2,589,350 ; Opiio n 3 . $2,632,456 : Optio n 4 : $3,078,563
. 4/Optio n 3 i s a n inseparabl e packag e lo rMaso n Cit yan d Fort Dodge , wit h Maso n Cit yreceivin g 1 9 roun d trip s a wee k an d Fort Dodg e 1 4 roun d trip s pe rweek . T o allocat e betv^ee n For t Dodg e an d Maso n City , w e hav e arbiiraril y applie d a rati o o f 19/3 3 t o th e iwo-cit ypackage .