Order 2 013

- 1

- 9

Served: J anuary 16, 2013



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 16th day of January

, 2013

Essential Air Service at

CODY, WYOMING

Under 49 U.S.C. 41731 et seq

. DOCKET DOT

- OST

- 2011

- 0121



### ORDER REQUESTING PROPOSALS

Summary By this O rder, the Departme nt is requesting proposals from airlines interested in providing

Essential Air S ervice (EAS) at Cody

, Wyoming, with or without subsidy , for a new rate term beginning June 1, 2013 . Pr oposals are due by February 19 , 2013 . (See Appendix A for a map.)

Background
Prior to the most recent selection order, SkyWest Airlines, Inc., operating as Delta Connection (Delta C onnection)

, operated two daily nonstop round trips (14 a week) to Salt Lake City International Airport on 30

- seat Brasilia EMB

- 120 aircraft. In addition, SkyWest operated as United Express (United Express) to Denver International Airport (Denver) providin g two daily round trips during the four

- month peak season and one daily round trip the other eight months of the year, all on 50

- seat Canadair regional jet aircraft.

On Ju ne 27, 2011, SkyWest filed a 90

- day notice of its intent to terminate service as Del ta
C onnection to Salt Lake City, effective September 25, 2011. In response to Delta Connection’s filing, we issued Order 2011

- 8

- 26, August 30

, 2011, requesting proposals from air carriers interested in providing EAS at the community. Because United Expre ss operated two daily round trips to Denver four months of the year and one daily round trip to Denver the other eight months, we requested proposals for only one round trip a day for eight months of the year. In response to that Order, we received a prop osal from the incumbent, Delta Connection

.

By Order 2011

- 11

- 24, November 18, 2011, the Department selected SkyWest Airlines, Inc., operating as Delta Connection (Delta Connection), to provide EAS at Cody from

October 4, 2011, through May 31, 2012, and fro m Octobe r 4, 2012, through May 31, 2013, for an annual subsidy of $352,058. Under the EAS subsidy contract, Delta Connection provides- 2

-

the community one daily round trip (seven a week) to Salt Lake City International Airport using 50

- seat Can adair Regional Jet 200 aircraft; the balance of its service is provided subsidy

free.

Request for Proposals Air carriers should file their prop osals no later than February 19

, 2013

. After that date, our staff will docket proposals, thereby making them public, and shortly afterwards will provide a summary of the proposals to the community and ask them for their final comments. We will give full consideration to all proposals filed in a timely manner.

Interested carriers should prepare their proposals with ev ery expectation that their initial proposals will also be their final and only proposals. We retain the discretion to negotiate proposals with carriers when we deem it desirable. We also retain the discretion to reject outright all unreasonable or unreal istic proposals and solicit a new round of proposals. Air carrier proposals should be submitted to the Department with all materials merged into a single document. In addition, because the document will be published on www.regulations.gov , each page should be formatted to be viewed online.

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. We expect proposals to adequately describe the service being proposed and the annual amount of subsidy being requested. The applicants can make their own judgments as to the level of detail they wish to present; however, they might want to include proposed schedules as well as supporting data for their subsidy requests, such as projected block hours, revenues and expenses. We strongly encourage clear, well

- documented proposals that will facilitate their evaluation by the affected community and the Departmen t. 1

Air c arriers are also welcome to propose more than one option, if they choose; they need not limit themselves to those requirements if they envision other, potentially more attractive service possibilities

-- different hubs, frequency or equipment, fo r example

-- with subsidy requirements that remain competitive. The communities and air carriers are encouraged to work together in advance of the due date for proposals to craft a service pattern that is desirable

to the communit y and meets the operation al needs of the airline s

.

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 have provided a summar y of historica l passengers in Appendix B. During the year ended September 30

, 2012

, Cody averaged 88 enplanements per day. Because SkyWest’s subsidy

free service from June through September to Denver International Airport full meets Cody’s EAS requirements, and its subsidy

- free service from October through May meets half of its minimum EAS requirements, we expect proposals that will provide only one round trip a day

1 In selecting a carrier to provide subsidized EAS , 49 U.S.C. § 41733(c)(1) directs us to consider four factors: (1) service reliability; (2) contractual and marketing arrangements with a larger carrier at the hub; (3) interline arrangements with a larger carrier at the hub; and (4) community views. In addition, the C onsolidated Appropriations Act, 2008, Public Law 110

- 161, 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 inception of the progr am. Interested carriers should also be aware that our general provisions governing EAS 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

-

from October 1

– May 31 (eight months) with 30

- 50

- seat aircraft to a large

- or medium

- hub

that offers access to the national air transportation system

. As always, we will formally solicit

the community ’ s views on any service options we receive before making a long

- term carrier

selection decision.

Other Carrier Requirements The Department is responsible for implementing various Federal statutes governing lobbying activities, drug

- free workplaces and nondiscrimination. 2 Consequently, all carriers receiv ing Federal subsidy to support Essential Air S ervice must certify that they are in complianc e with Department regulations regarding drug

- free workplaces and nondiscrimination, and those carriers whose subsidies exceed $100,000 over the life of the rate term must also certify that they are in compliance with the regulations governing lobbying acti vities. All carriers that plan to submit proposals involving subsidy should submit the required certifications along with their proposals. Interested carriers requiring more detailed information regarding these requirements, as well as copies of the cert ifications, should contact the Office of Aviation Analysis at (202) 366

- 5903. The Department is prohibited from paying subsidy to carriers that

do not submit these documents. 3

Community and State Comments

Civic officials are welcome to submit comments on the proposals at any time. As noted earlier, we will provide a summary of the proposals to the civic parties and ask them to submit their final comments shortly after February 19, 2013

, the due date for carrier proposals.

This O rder is issued under auth ority delegated in 49 CFR Part 1.56a(f) and re

- delegated to the Director, Office of Aviation Analysis.

ACCORDINGLY, 1. We request that air carriers interested in providing Essential Air Service at Cody, Wyoming

, submit their proposal , with or without sub sidy requests, no later than February 19, 2013 . The proposal should be emailed to: EAS@dot.gov with the title “Proposal to Provide Essential Air

Service at Cody, Wyoming ”; 4

2. This docket will remain open until further order of the Department; and

2 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

– Effectuation of title VI of the Civil Rights Ac t of 1964; 49 CFR Part 27

– Nondiscrimination on the basis of disability in programs and activities receiving or benefiting from Federal financial assistance; and 14 CFR Part 382

– Nondiscrimination on the basis of disability in air travel; and (3) 49 CFR Part 29

– Government

- wide debarment and suspension (non

procurement) and government

- wide requirements for drug

- free workplace (grants).

3 The certifications are also available on the web at http://ostpxweb.dot.gov/aviation/index.html.

4 Questions regardi ng filings in response to this order should be directed to Michael Martin at 202

- 366

- 6494, or

via email at michael.f.martin@dot.gov

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-

3. The Department will serve a copy of this O rder on the Mayor and Airport M anager of Cody ; the Wyoming Department of Transportation, SkyWest Airlines, Inc.

, operating as Delta Connection, and the service list for this Docket

.

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

Aviation Economic Regulations, 14 CFR Part 385.50, must file such petitions within ten (10) days aft er the date of service of this O rder.

This O rder 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 document is available on line at www.regulations.gov

### Appendix A



## Area Map

Maps generated by the Great Circle Mapper

- copyright © Karl L. Swartz

.

### APPENDIX B

Historical Origin

- Destination Plane Traffic 1



### Cody, Wyoming

Quarter Year Deplanements Enplanements Total
Traffic Enplanements per Day

4 2009 5,191 5,423 10,614 67

1 2010 3,794 3,909 7,703 50

2 2010 7,329 6,913 14,242 91

3 2010 10,102 11,015 21,117 134

Annual

Totals 26,416 27,260 53,676 86

4 2010 6,303 6,599 12,902 82

1 2011 5,007 5,069 10,076 65

2 2011 7,824 7,418 15,242 98

3 2011 9,311 9,929 19,240 122

Annual

Totals 28,445 29,015 57,460 92

4 2011 5,247 5,602 10,849 69

1 2012 4,684 4,838 9,522 62

2 2012 7,449 6,943 14,392 92

3 2012 9,840 10,464 20,304 129

Annual

Totals 27,220 27,847 55,067 88

1 Source: USDOT Bureau of Transportation Statistics, TransStats Intermoda l Database, Schedule T

- 1 00

.

### Appendix C

Example of General Terms and Conditions 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 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 schedu le 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 these rates, 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 ca rrier 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 com pletely, 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 stipula ted 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 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 cessation of payment.

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, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds are not currently available for performance under this solicitation beyond [DATE] . The Department’s obligation for performance u nder this soli citation beyond [DATE] , is contingent upon the availability 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 [DATE] , until funds are made available to the Department for performance. If funds are not made available for performance beyond [DATE] , the carrier will receive notice in writing by the Department.

All claims for payment must be submitted within 60 day s of the last day of service provided

under this order.