Order: 2011-9-10

 Served: September 15, 2011

 UNITED STATES OF AMERICA

 DEPARTMENT OF TRANSPORTATION

 OFFICE OF THE SECRETARY

 WASHINGTON, D.C.

 Issued by the Department of Transportation

on the 15th day of September , 2011

Essential Air Service at

CEDAR CITY, UTAH DOCKET DOT-OST-2003-16395

under 49 U.S.C. 41731 et seq.

ORDER RE-SELECTING CARRIER

Summary

By this order, the Department is re-selecting SkyWest Airlines, operating as Delta 

Connection (SkyWest), to provide essential air service (EAS) at Cedar City, Utah, using 

50-seat Canadair Regional Jet 200 aircraft for a two-year period beginning January 1, 2012, 

through December 31, 2013, for an annual subsidy of $2,273,395.

1

Background

By Order 2009-11-7, November 5, 2009, the Department selected SkyWest to provide 

EAS at Cedar City for the period from January 1, 2010, through December 31, 2011, for an 

annual subsidy of $1,477,125 for 12 nonstop round trips per week to Salt Lake City 

International Airport (Salt Lake City) on 30-seat Embraer Brasilia aircraft.

As the end of the contract was approaching, we issued Order 2011-6-27, June 27, 2011,

requesting proposals from carriers interested in providing EAS at the community, for a 

new, two-year period beginning January 1, 2012. In response to that order, we received 

proposals from the incumbent, SkyWest, as well as SeaPort Airlines, Inc. (SeaPort).

 1 Such subsidy is calculated and distributed on a fiscal year basis, subject to the availability of appropriated 

funds.
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Each carrier’s complete proposal and community comments may be accessed online at 

http://www.regulations.gov/ by entering Docket number DOT-OST-2003-16395 in the 

search block. 

Proposal of SkyWest

SkyWest proposed two weekday and two weekend nonstop round trips (12 a week) to Salt 

Lake City using 50-seat Canadair Regional Jet 200 aircraft for an annual subsidy of 

$2,273,395. 

Proposal of SeaPort

SeaPort proposed three weekday and three weekend nonstop round trips (18 a week) to 

Salt Lake City using 9-seat Pilatus PC-12 aircraft for an annual subsidy of $1,956,900.

Community Comments

On August 4, 2011, we requested community comments regarding this carrier-selection 

case. In response, we received letters from Joe Burgess, Mayor of Cedar City, the City 

Council of Cedar City, and Russ Volk, Airport Manager at Cedar City Regional Airport. 

All three letters overwhelmingly supported SkyWest for a new two-year term. Mayor 

Burgess states: “SkyWest has served this community for more than 30 years, and over this 

time has earned a sterling reputation for reliable, quality performance. Over the past four 

months, our enplanement numbers have been 35 to 50 higher than the same period last 

year.” Mr. Volk commented, “It is my belief that the planned switch to regional jets will 

generate additional passenger flows, thus creating increased economic development 

opportunities and tourism travel to visit local attractions, as well as our many regional 

national monuments and parks.” All three letters clearly stated that Cedar City will not 

waive its entitlement to 15-seat or larger aircraft, and therefore cannot support the proposal 

put forth by SeaPort.

Decision

The decision is straightforward and clearly points to the re-selection of SkyWest for a new,

two-year term. The community fully supports SkyWest’s proposal and the airline has 

provided reliable EAS at Cedar City for several years. We acknowledge that SkyWest’s 

subsidy request is significantly higher than its present subsidy, although that is due at least 

in part to the upgrade in aircraft from 30-seat Brasilia’s to 50-seat regional jets. (However, 

because the community has seen an increase in enplanements, the per passenger subsidy is 

$122, well under the $200 subsidy cap.) Moreover, the community has affirmatively not 

waived its right to 15-seat or larger aircraft. 

We shall make this selection of SkyWest at Cedar City contingent upon the Department’s 

receiving properly executed certifications from the carrier that it is in compliance with the 

Department’s regulations regarding drug-free workplaces and nondiscrimination, as well as 

the regulations concerning lobbying activities.
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Carrier Fitness

49 U.S.C. 41737(b) and 41738 require that we find an air carrier fit, willing, and able to 

provide reliable service before we may subsidize it to provide essential air service. 

SkyWest is subject to the Department’s continuing fitness requirements, and no 

information has come to our attention that would cause us to question the carrier's fitness at 

this time. We have contacted the Federal Aviation Administration, and it has raised no 

concerns that would negatively affect our fitness findings. We therefore conclude that the 

carrier is reliable and remains fit to conduct the operations proposed here.

This order is issued under authority delegated in 49 CFR 1.56a(f).

ACCORDINGLY,

1. We select SkyWest Airlines, operating as Delta Connection, to provide essential air 

service at Cedar City, Utah, and establish an annual subsidy rate of $2,273,395, as 

described in Appendix C; 

2. We direct SkyWest Airlines to retain all books, records, and other source and summary 

documentation to support claims for payment, and to preserve and maintain such 

documentation in a manner that readily permits its audit and examination by 

representatives of the Department. Such documentation shall be retained for seven years or 

until the Department indicates that the records may be destroyed, whichever comes first. 

Copies of flight logs for aircraft sold or disposed of must be retained. The carrier may 

forfeit its compensation for any claim that is not supported under the terms of this order;

3. We find that SkyWest Airlines continues to be fit, willing and able to operate as a 

certificated carrier, and capable of providing reliable essential air service at Cedar City;
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4. This docket will remain open pending further Department action; and

5. We will serve copies of this order on the Mayor of Cedar City, the City Council of 

Cedar City, the airport manager of Cedar City Regional Airport, SkyWest Airlines, and 

SeaPort Airlines, Inc.

By:

SUSAN L. KURLAND

Assistant Secretary for

Aviation and International Affairs

(SEAL)

An electronic version of this document is available at

http://www.regulations.gov
Appendix A

AREA MAP

 
Appendix B
 Appendix C

SkyWest Airlines

Essential Air Service to be Provided at Cedar City, Utah

Effective Period: January 1, 2012, through December 31, 2013

Scheduled Service: Two weekday and weekend nonstop round trips (12 a week) to Salt Lake 

City

Aircraft: 50-seat passenger Canadair Regional Jet 200 (CRJ200)

Rate per Eligible Flight: $1,859;

1

Weekly Ceiling: $44,6162

Note: 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 schedule 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 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 completely, 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 stipulated 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 the 

carrier do not constitute a total or partial reduction or cessation of payment.

Funds are not currently available for performance under this order beyond September 30, 2011. The Department’s 

obligation for performance under this order beyond September 30, 2011, is subject to 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 September 30, 2011, until funds are made available to 

the Department for performance. If funds are not made available for performance beyond September 30, 2011, 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, regulations, or amendments thereto shall not 

operate to controvert the foregoing paragraph.

All claims for payment must be submitted within 60 days of the last day of service provided under this order.

 1 Annual compensation of $2,273,395 divided by 1,223 annual departures (24 weekly departures x 52 weeks x 98 

percent completion).

2 24 arrivals and departures per week multiplied by $1,859 per flight.