Essential Air Servic e a t Pendleton , O R unde r 4 9 us e 4173 1 etseq . Docke t OS T 2004-1993 4

RENEWE D PROPOSA L T O PROVID E ESSENTIA L AI R SERVIC E A T PENDLETON , O R DOCKE T ALASKA JUNEA U AERONAUTICS , INC
. D/B/ A SEAPOR T AIRLINE S c. n >
c r O , - o : D

C O

OS T 2004-1993 4

# SE A POR T

r A I R L I N E S 

### Proposa l t o Rene w Essentia l Ai r Servic e Pursuan t to Order 2009-4-8 , Alask aJunea

u Aeronautics , Inc . d/b/

aSeaPor t Airline s respectfull y submit s thi s renewa

l proposa l to provid e subsidize d essential air servic e t o th e communitie s and resident s o f

Easter n Oregon
. SeaPor

t Airline s hold s acertificat e o f publi c convenienc e and necessit y authorizing , an d finding SeaPor t fit to engag e in , schedule d interstat e ai r transportatio n o f persons , property , an d mail , and ha s bee n doin g s o fo r th e pas t 2 7 years . Ou

r company's foundatio n i s buil t

o n servic e to rural communities
. Bot h SeaPor t Airline s and it s siste r

compan y Wing s o f Alask acurrentl y operat e route s unde r th e Essential Ai r

Servic e program , a s wel l a s un subsidize d operation s o n establishe d competitiv e routes . SeaPor t Airlines : Th e Right-Siz e fo r Pendleto n SeaPor t Airline s propose s to continu e th e operatio n o f thre e direc t

roun d trip s per

da y betwee n Pendleto n and th e hub o f

Portland
. Thi s servic e leve l wil l offe r more tha n enoug h inventor

y to provid e fo r th e traffi c o f

th e las t coupl e years , whil e keepin g capacit y "right-sized " an d avoidin g a n unnecessar

y flooding o f

empt y seat s an d resultin g highe r operatin g costs . h i addition , w e wil l sustai n aschedul e t o maximiz e traffi c flow wit h flights morning , midday , an d evening
. SeaPor

t believe s tha

t traffi c wil l continu e to increas e in th e comin g year s a s th e spee d and convenienc e o f

ou r servic e continue s t o becom e more familia r to th e resident s o f

thes e communities
. W e ar e therefore abl e to continu e t o offe r thes e communitie s th e bes t possibl e fi

t with : • Comfortable , fast , an d pressurize d Pilatu s PC-1 2 aircraf t • Convenien t

schedule s • Affordabl e fare s • A reasonabl e and sustainabl e subsid y reques t Ou r Aircraf t SeaPor t Airline s operate s several Pilatu s PC-1 2 aircraft
. Th e PC-1 2 i s aSwiss-built , pressurize d turbopro p aircraf

t typicall y found i

n corporat e aviation , bu t utilize d b y SeaPor

t Airline s i

n a nine-sea t commute r

configuration
. Th e world' s best-sellin g turbin e busines s aircraft , an d stil l in productio n today , th e PC-1 2 ca n shuttl e yo u wit

h comfor t and spee d wit

h n o "middle " seats . Pilatu s i s aworl d marke t

leader i n th e manufacturin g o f

turbopro p aircraf

t an d i s th e onl y Swis s compan y t o develop , produce , an d sel l aircraf t an d trainin g system s al l over th e world
. Ou r competitor s offe

r aircraf t tha t ar e unpressurized , hav e spott y record s in operatio n i

n th e weather tha t i s prevalen t

in th e Pacifi c Northwest , an d in som e cases , bee n ou t o f productio n fo

r 4 0 years .Efficienc y an d Reac h

SeaPor t Airline s i s already full

y integrate d int o (Global Distributio n System ) CD S s o tha t passenger s wil l hav e multipl e channel s fro mwhic h t o purchas e tickets , includin g al l o f th e familia r brande d GD S portals
. Customer s wil l b e abl e to cal l ou r central reservation s office , boo k onlin e a t www.seaportairlines.com , o r purchas e fro

mtrave l agents . A number o f onlin e trave l agencie s and meta-searc h engines , suc h a s Expedi aan d Kayak , ar e currentl y abl e t o carr

y SeaPor t inventory
. SeaPor

t continue s to expan d it s presenc e o n additional onlin e trave l agenc y sites
. Passenger s are alway s welcom e t o simpl y wal k up to th e counte r

i f the y s o desire
. SeaPor

t ha s als o entere d int o a

n interlin e passenge r

agreemen t

wit h U S Airways , givin g passenger s eve n furthe r choic e an d convenience
. Histor y o f

Servin g Essentia l Ai r

Servic e Communitie s SeaPor t Airline s currentl y deliver s Essential Ai r Servic e t o seve n communities : Excursio n hilet , AK , Pendleton , OR , Jonesboro , AR , E l Dorado , AR , Ho t

Springs , AR , Harrison , AR , an d Salina , KS
. Additionally , SeaPor t serve s Newport , O R an d Astoria , O R unde r acombine d state and federa l gran t program . h i ever y case , w e hav e maintaine d fare s eithe r a t or belo w tha

t whic h w e outline d in our bid , i n compariso n t o s o many othe r airline s placin g bid s wit

h unreasonabl e fare s tha

t are neve r realize d b y th e travelin g public
. SeaPort' s Curren t

Pla n SeaPor t Airline s emphasize s custome r servic e an d convenience , an d i n s o doin g ou r platfor mi s reminiscen t

o f commercial ai r

servic e o f

th e pas t in tha t our passenger s onl y nee d t o arriv e 2 0 minute s prio r

to departur e fro

man y o f our terminals
. I n Portland , SeaPor

t use s it s ow n privat e terminal a s ahu b fo r thi s operatio n wit

h vale t parking
. Fro mthi s termina l w e wil l continu e to provid e complimentar y shuttl e va

n servic e t o and fro

m Portland' s mai n terminal fo r thos e passenger s needin g to connec t to , o r returnin g from , more distan t destinations
. Thi s mode l ha s thu s fa r prove n itsel f

wel l a t our hu b in Portland , OR , and i s a s convenien t

a s th e typical gate change—onl y wit h thi s optio n th e passenge r receive s a complementar

y shuttl e ride
. Further , ano-TS A mode l wil l continu e to offe r th e communitie s tremendou s appeal fo r quic k trip s to an d fro

mPortlan d an d othe r

potentia l major

marke t connection s t o b e serve d b y SeaPort
. Finally , ano-TS A mode l wil l continu e t o hav e th e greates t

potentia l to draw busines s an d leisur e traffi c fro mPortlan d tha

t woul d otherwis e trave l b y highwa y i f atraditiona l TSA-restricte d airlin e wa s th e onl y flight

option
.Histor y of Servin g Pendleton , Orego n Fo r nearl y tw o years , SeaPor

t Airline s ha s had th e pleasur e o f providin g Pendleton , Orego n wit h auniqu e ai r

servic e unlik e anythin g in th e industry
. Ease , convenience , an d custome r

servic e hav e accompanie d ever

y flight, an d a

t a n affordabl e rate . SeaPor t ha s provide d th e comfor t o f privat e ai r

trave l o n aschedule d commute r service , and th e respons e ha s bee n overwhelmingl y positive
. SeaPor

t ha s bee n extremel y please d wit h it s successfu l servic e to Easter n Orego n a s i

t steadil y develop s int o a

n increasingl y sustainabl e route , investin g no t onl y i n th e ai r service , bu t in th e communit

y itself
. Genera l operation s an d schedule d flights
. I n th e las t

eigh t months , SeaPor

t Airline s ha s maintaine d acompletio n rate o f 100 % fo r Pendleto n flights. Flight s were onl y cancelle d or delaye d du e to extrem e fog , whe n visibility wa s belo w th e lega l limits
. SeaPort' s histor y o f minimizin g controllabl e cancellation s an d delay s ha s bee n industr y leading
. Custome r service
. SeaPor

t Airline s service s hav e bee n wel l receive d b y th e Easter n Orego n regio n an d surroundin g areas . Th e SeaPor t custome r servic e philosoph y ha s been integral t o th e succes s o f th e servic e t o Pendleton , highlightin g tha t eac h passenge r

i s a n individual , an d eac h shoul d hav e thei r

need s addresse d accordingly
. Ou r custome r servic e agents , flight

crew , an d other staf f are no t onl y traine d t o b e knowledgeabl e an d attentive , bu t ar e selecte d fo

r thei r friendly qualifie s an d abilitie s to expres s consideratio n fo r th e need s o f

our clients
. SeaPor

t passenger s are aske d t

o participat e i

n ou r surve y programupo n completio n o f thei r flying experience , an d comment s suc h a s th e followin g hav e bee n recorde d and ar e no t uncommon : • "Friendl y an d persona l service
. Amazingl y smoot h take-of f and landing
. I

t wa s great! " • "Grea t service ! Lov e check-i n time! " • "Ver y fas t an d efficien

t service
. Wonderfu l staff ! M y first tim e wit h SeaPort , an d I pla

n to return! " • "Ver y friendl y staff

, excellen t

service
. Than

k you , SeaPort. " • "Wonderful , personabl e employees! " • "Wonderful , informativ e staff. " • "Ver y friendl y and helpful. " • "Friendl y cre w and supe r convenient. " • "Ver y goo d experience! " Marketin g an d publi c relations
. Althoug h th e qualit y o f custome r attentio n th e airlin e provide s market s itself

, SeaPor t Airline s ha s mad e enormou s effort s to reac h Pendleto n an d surroundin g communifie s b y ufilizin g anumbe r o f marketin g channels , aime d a t bot h buildin g and maintainin g astron g cliental base
. Advertising
. Print

and interne t

banne r advertisin g ha s bee n facilitate d throug h th e Eas t Oregonian , Wall aWall aUnion-Bulletin , LaGrand e Observer , Hermisto n Herald , an d th e Wallo w Count

y Chieftain
. Touris t

guides , suc h a s th e Easter n Orego n Visito r

Guide , Wall a Wall aUnion-Bulleti n Vistitor' s Guid e an d Wallo w Count y Cheiftai n Visitor' s Guid e contai n SeaPor t advertisements
. Potential client s hav e bee n targete d vi alocall y broadcaste d radi o statio n advertisements , suc h a s thos e produce d b y Capp s Broadcastin g an d Pacifi c Empire Radio
. Th e Pendleto n Chambe r

o f Commerc e ha s bee n supporte d an d employe d a s amean s t o reac h ou t

vi achamber newsletter s an d website
. Outdoo r advertising , includin g billboard s o n 1-8 4 nea r Pendleton , Boardman , an d L aGrande , ha s bee n implemented
. A number o f T V commercial s hav e bee n produce d an d aire d o n television , utilizin g KOIN , KATU , CSNN , CNBC , CNN , FSNW , FXN C an d GOLF
. Hermisto n an d Pendleto n Theatr e scree n advertisement s wer e a t on e tim e implemente d a s well
. Promotions
. Promotion s suc h a s th e SeaPor t Airline s "Firs t

Tim e Flyer " far

e betwee n Portlan d and Pendleto n hav e increase d passenge r loads , givin g bot

h inboun d an d outboun d passenger s th e opportunit y t o tr y our airlin e wit

h littl e impac t

o n thei r pocketbooks
. However , our loya l flyers ar e continuousl y entice d to us e our service s wit

h our "No-B S Frequen t

Flyer " card , awardin g client s afre

e flight wit h ever y twent y one-way trips
. "Earl y Bird " fare s hav e bee n establishe d to encourag e ou r

client s t o boo k

reservation s wel l in advance , a s wel l a s t o encourag e ridershi p o n les s popula

r flights. Fo r

corporat e travel , w e hav e atiere d Valu e Accoun t syste mtha

t make s purchasin g fare s fo

r busines s trave l simple , traceable , an d rewarding
. A numbe r o f promotion s hav e bee n execute d fo

r charte r service s t o specifi c events , suc h a s PACI O footbal l and th e Yakim aFres h Hop s Festival
. Interne t an d social media
. Wit

h a n establishe d website , and th e institutio n o f bookin g capabilitie s o n onlin e trave l agenc y site s an d meta-searc h engines , anumbe r o f possibilitie s hav e presente d themselve s fo

r marketin g th e Pendleto n rout e globally
. SeaPor t Airline s no w ha s adedicate d Faceboo k and Twitte r

account , wit

h asoli d followin g o f client s and non-client s tha t ar e endce d t o participat e throug h round-tri p ticke t contes t giveaways
. Socia l medi aha s bee n agrea

t too l fo r promotin g events . Communit

y Outreac h an d Service
. SeaPor t Airline s ha s supporte d event s roote d i n th e Pendleto n community
. An aircraf t wa s recentl y dedicate d fo r th e Centennia l Pendleto n Round

Up , declarin g th e "Spiri t

o f Pendleton " b y brandin g i t wit h th e Round-Up logo
. Further suppor t ha s bee n exhibite d wit

h sponsorshi p o f

th e rodeo' s "Toug h Enoug h t o Wea r Pink " event

a s wel l a s participatio n in pas t

Round-Up activities
. Thre e additiona l round-trip s were adde d t o th e schedul e to facilitate additiona l trave l to Pendleto n fo r th e Round-Up event . Round-tri p ticke t voucher s hav e bee n donate d o n aregula r basi s t o fundrais e fo

r event s an d auctions , suc h a s thos e hel d b y St
. Anthony' s Hospital
. SeaPor t ha s recentl y worke d wit

h Umafill aCount

y in promotin g th e communit

y an d it s ai r

servic e a t th e Orego n State Fair
. SeaPor t ha s bee n asponso r

fo r event s lik e th e Yog aRound-Up a s well , providin g bot h advertisement s i n our

in-flight magazin e an d round-tri p ticke t

donafions
. SeaPor t ha s hoste d ope n hous e event s a t th e airpor

t terminal , providin g Eastern Orego n wit h a n opportunit y t o ge t t o kno w th e airline , our

philosophy , and our

employees
. A Bo y Scou t

Aviafio n Badg e program , lead b y SeaPort' s assistan t chie f pilot , wa s implemente d in suppor t o f local Bo y Scou t

efforts
. Currently , SeaPor t i s developin g aCommunit y Non-Profi t Partnershi p Progra

mwit h th e goa l o f aidin g local non-profit s i n thei r work
. SeaPor

t donate s annuall y to a

n aeronautica l competitio n hoste d a t th e airpor t in Pendleton
.Passenge r Load s an d Sustainabilit y Potentia l SeaPor t Airline s ha s witnesse d excellen t growt h i n ridershi p sinc e i t bega n servic e t o Pendleto n i n Decembe r

2009
. Betwee n Februar y 201 0 an d Jun e 201 0 alone , w e hav e see n a20-25 % increas e i n passenge r

number s enplanin g an d deplanin g i n Pendleton
. Wit h th e implementatio n o f a"Firs t Tim e Flyer " promotio n i n Jul y 2010 , SeaPor t witnesse d a12-14 % increas e i n ticket s issue d i n th e followin g mont h betwee n Pendleto n an d Portland
. Th e increas e i n passenge r load s contribute s t o lowerin g cost s an d exhibit s SeaPort' s trendin g toward s sustainabl e ai r service
. Thi s i s mos t

notabl y evidence d b y areduce d subsid y reques t fo r th e nex t tw o year s a s compare d t o th e perio d w e ar e no w completing
. SeaPor t welcome s thi s opportunit y t o onc e agai n b e chose n t o provid e essentia l ai r servic e at Pendleton , Orego n fo r

th e nex t two-yea r

period
. W e brin g afres h approach , an d believ e w e hav e presente d aproposa l tha t wil l mee t

th e EA S need s o f

th e communitie s a t

reasonabl e subsid y level s substantiall y les s tha n ou r initia l proposal
. Than k yo u fo r you r consideration
. Respectfull y submitted ,

Rober t L . McKinne y Presiden t Alask aJunea u Aeronautics , Inc . d^/ a SeaPor t Airline s Wing s o f Alask a Enclosure s Correspondenc e regardin g thi s proposa l shoul d b e directe d to : Ro b McKinne y Presiden t SeaPor t Airline s 750 5 N E Airpor t

Wa y Portland , O R 9721 8 (971)340-171 0 www.scaportairlincs.co mX

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