City Manager's Office Cityof Kearney 18 East22nd Street P. 0. Box 1180 Kearney, NE 68848-1180 July 14, 2014 Mr. Michael Martin 

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United States DepartmentofTransportation Office ofAviation Analysis 1200 NewJerseyAvenue SE Room W86-472 Washington D.C. 20590 Reference DOT-OST-1996-1715 Dear Mr. Martin: TELEPHONE · (308) 233-3214 FAX · (308) 234-6399 E-MAIL· mmorgan@kearneygov.org

WEBSITE· www.cityofkearney.org

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This letterconstitutes the official comments ofthe City of Kearney regarding the results of the request for Essential Air Service proposals outlined in Order 2014-4-30 that was issued on April 29, 2014. We have carefully reviewed the bid proposals of Great Lakes Aviation. Our comments regarding the Great Lakes bid(s) are below. The first bid is a B1900D 9-seat option for 18 weekly trips to Denver for $2.993 million, resulting in a $235 subsidy per O&D. This proposal forecasts 12,750 annual passengers. This is roughly half the level of historic traffic in Kearney. Further, the bid as proposed would be in violation of the $200 subsidy per passenger cap that the Department of Transportation (DOT)will be enforcing starting in FY 2015. The second bid is a B1900D 19-seat option for 18 weekly trips to Denver for $2.034 million, resulting in a $75 subsidy per O&D. This proposal forecasts 27,000 annual passengers. This scenario is certainly betterthan the 9 seat bid for both the DOT and the community. However, there is great uncertainly on what timeline this scenario would come to pass. As a result, the community needs greater clarification on the timing ofthis bid. The third bid is an undefined proposal for 12 weekly RJ flights using the metrics ofthe 9- seat option but with no forecast ofpassengers, fares or costs. This proposal is offered "at Great Lakes discretion" and we are not sure what that means. Kearney sees this as the most desirable option from Great Lakes. However, there are a number of unclear items with this bid. Great Lakes requests the "full marketing support ofthe communities"forthis option. Kearney requires a greaterqualitative and quantitative understanding ofwhatthis would require. Additionally, Kearney needs much greater clarification on when the jets would be available for service and what level of reliability the service would offer. If Kearney is to market and promote newjet service it must be consistently reliable for the communityto use and trustthe service.Mr. Michael Martin Page 2 July 18, 2014

Aftercareful consideration we are requesting thatthe DOT call for a re-bid ofthe Kearney EAS RFP. Our reasons include;**~** The 9 seat bid will greatly diminish passengertraffic. This is directly contraryto the goals ofthe community and the airport. It is unclearwhetherthe community would see increased reliability in air service in this scenario from today's reduced level of reliability. Further, Kearney would be in violation of the $200 subsidy per passengercap thatthe DOTwill be enforcing starting in FY2015.**~** The community needs much greaterclarification on both thejet bid and the 19 seat 81900 bid. Understanding the marketing requirements of the community, the timeline of when service would start, the reliability of such service, and other pertinent details must be spelled out in much greater detail for Kearney to get comfortablewith these alternative bids. We do very much appreciate the interest that Great Lakes Aviation has shown in our market and we urge them to submit bids in a rebid process. We hope that Great Lakes and other carriers will, at the time of rebidding and in the comment period thereafter, be able to more fully demonstrate what their final operating plans and timelines are in much greaterdetail. We appreciatethe Department ofTransportation working with us to find the mosteffective EAS solution for Kearney. Our airservice is very importantto us and we want to use this bidding process to find an air service solution that can be awin for both the airline and the community. Sincerely,
MichaelW. Morgan City Manager

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