Swanson, Brian (OST) 

bOT"- Ot>T· ~'l~~- t1-U 

par:asr: 1oo -IS1-I5 

From: 

Sent: 

To: 

Subject: 

Attachments: 

Devany, Dennis (OST) 

Friday, February 10, 2012 9:50 AM 

Swanson, Brian (OST) 

FW: Alternate EAS at Manistee (Budgets) 

Combined EMB120 Winter-Summer.xlsx; Jetstream 19 seat.xls 

From: checktsa@gmail.com [mailto:checktsa@gmail.com] On Behalf Of Jim Gallagher 

Sent: Friday, February 10, 2012 9:37AM 

To: Devany, Dennis (OST); Manistee Airport; MHoyle@businessaircraftgroup.com 

Subject: Alternate EAS at Manistee (Budgets) 

Dennis and Barry, 

We have worked through budgets trying to find solutions to lowering the 

costs associated with the Alternate EAS proposal to Manistee, Michigan for service to 

Chicago, Illinois. Unfortunately, the original proposal utilizing a dedicated EMB 120 

aircraft with 30 seats will have to remain the same; as we have already squeezed as 

much out of that proposal as possible in order to justify the start up of this program. The 

ultimate problem stems from aircraft monthly utilization and the fact that we need 

to maintain a certain level (minimum) flight hours in order to dedicate full resources in 

that region. Of course we anticipate that these costs would certainly become reduced if 

we were to have multiple awards serving the same region. However it is our desire to 

focus intently on the Manistee project since it is the first of its kind in order to truly put 

forth our best effort in continuing the success that was achieved with Frontier. Coming 

off the heels of a EMB 135 regional jet averaging 20+ passengers per flight is exactly 

why we believe we need to commence service with equipment that closely mirrors the 

airliner service that the community has recently become accustomed to and by way of 

enplanenments indicates it supports. 

We are also willing to propose the below alternatives to accommodate the start up for the MBL 

community as soon as possible. Every day that goes by, decreases our chances of success. 

The high season starts May 01 and if we are to meet this start date; we will need a fast 

decision from the DOT so that we can publish our schedules and fares and get to work setting 

up all of the logistics involved with introducing Public Charters and Charter Air Transport into 

the marketplace. We are unable to offer any twin turbine aircraft solutions at the current expired 

rate of $1,700,000 (more or less). 

We offer the following alternative proposals in addition to the original proposal submitted utilizing 

a year round EMS 120 aircraft: 

1 
1. $2,112,000 average subsidy per year: Commence service May 01 with a 30 seat EMB120 

operating 1 Ox frequencies per week; then replace the EMB 120 in the Winter with a 19 seat Jet 

stream operating the same frequency ( 1 Ox) weekly for the remainder of the 2 year contract. 

a. This will afford public charters time to work with the Direct Air carrier in type rating the 

Jetstream on certificate 

b. This will inaugurate service during the peak period with a more desirable aircraft to 

overcome some of the market education that will need to take place with the introduction to a 

new destination (MOW) and a new concept for creating routes that serve both O&D to Chicago, 

but also a creative interline solution with the Low Cost carriers of Midway, since we 

lack traditional interline agreement with the legacy carriers. 

c. It is our intention that if load factors reach levels that will support the EMB120 at any time 

during the 2 year period that we would replace the 19 seat aircraft with the 30 seat aircraft 

without any further increase in subsidy; which really means that we are taking our own risk in 

utilizing the larger aircraft and it would be our first steps towards reducing subsidy rates in the 

future or ultimately operating without subsidy if the market can sustain itself. 

2. $1,994,000 average subsidy per year: Commence service June 01 with a 19 seat Jetstream 

31 operating 1 Ox frequencies per week year round 

One additional item that we would consider in the Alternative proposal is that if we consistently 

average the projected load factors in our estimated budgets that after a certain point in time that 

we would permit the airport to re-negotiate our subsidy level to reflect a reduction because of our 

success. While we know this is not the way that traditional EAS is monitored; we believe that 

this is the most fair and equitable way to gauge subsidy levels in a marketplace and put our 

intent in writing that after 6 months of averaging projected load factors in our proposal that it 

would trigger a "period of re-negotiation in rate" for the airport. 

Let me know what you think. We have always been willing and able. We want to provide the 

BEST service available and really need an action plan if we are going to start May 01 and have 

the shortest hiatus in service at MBL. 

Thank-you for considering our proposals. Attached are the excel detailed budgets for the full 

annual operations with an EMB120 and also the annual19 seat budgets. 

Sincerely, 

Jim Gallagher 

Aviation Technologies, Inc. 

PublicCharters.com 

CheckTSA.com 

201 Hangar Road 

Wilkes-Barre/Scranton International Airport 

2 
Avoca, PA 18641 

570-457-4147 Phone 

570-457-4113 Fax 

570-760-0880 Cell 

3 
CHMTiAA.Ia 

fare Range: 

Aircraft: 

Aircraft Base: 

!ill!! 

Weeks per Month 

Days per Week 

Depts per Week 

Dept.s per Month 

Avg. Block per Leg 

Ttl Block per Month 

Load Factor 

Seats per fhght 

Pax per flight 

Avg_ Pax Fare 

Ttl Pax per Month 

Tkket Rev 

Credtt Card Fee 

FET & 7.5% 

Agent Comm 

Ttl Op. Revenue 

Direct Operating Cost 

ACMI 

Fuel 

Ground 

Deicmg 

Catenng 

Ttl Direct Op. Cost 

Indirect Costs 

Advertmng 

Reservation/GDS 

Call Center 

Ttllndire« Op. Cost 

Ttl Op. Cost 

Op.eratins: P/l 

and -f.i:JJBLIC 

-.rrERS, INC 

.... s 49 00 ...... 1 s 27·30 : 

149.00 I MBL Service to MOW EMB·I20 Seats: 

MBl 

MBl 

MDW 

MBl 

MDW 

Ttl Segs: 

lilil 4.3 

14 

60 

0 90 

0400 

SO% 

30 

15 

69.00 

903 

61,10000 

(2,173.50) 

(4,130 97) 

(1,733 02) 

53,962.51 

$ 99,900 00 

$ 35,640.00 

$ 54,481 00 

$ 10,000.00 

L__~ 

$ 101,375.50 

4,515 00 

6,772 50 

1,000 00 

13,287.50 

214,663.00 

($160,700.49) 

Schedule: 2x Daily (lX DAY 6-7) October thru March 

:11.1 r!!YJt N5AM MOW 

ll:OOAM MBl 

1:30PM MDW 

L___~gQ~fv1. _L__ ~Bl_ L .. 

TIMES ARE FLEXIBLE. 

WI 4.3 

7 

14 

60 

090 

54 00 

50'~ 

30 

15 

69.00 

903 

62,100.00 

(2,173.'>0) 

(4,230 97) 

(1,733 02) 

53,962.51 

99,900 00 

35,640.00 

MID: 4.3 

14 

60 

0 90 

54 00 

50% 

30 

15 

69.00 

903 

61,100 00 

(2,173 50) 

(4,230 97) 

(1,733 02) 

53,962.51 

99,900 00 

35,640.00 

HSAM 

1:00PM 

1:30PM 

8:()()~M 

fu!! 

43 

14 

60 

0.90 

54 00 

50'~ 

30 

15 

69.00 

903 

62,100 00 

(1,173 50) 

(4,230.97) 

(1,733.02) 

53,962.51 

99,9GO.OO 

35,640.00 

Stops 

0 

0 

0 

0 

~ 

43 

14 

103 

0.90 

92.70 

50% 

30 

15 

69.00 

1,548 

106,605 00 

(3,731.18) 

(7,263.41) 

(1,975 02) 

92,635.39 

161,115.00 

61,182.00 

$ 

s $ 

Program Toal costs are adjusted for Winter opts reduced to lx Daily 

ACMIInd. Hotel & per diem 

Destin. Ground Fee 

Origin Ground Fee 

Destinaton Tum 

Origination Turn 

fuel burn/hou 

I!!!! 43 

6 

14 

103 

0 90 

92 70 

50% 

30 

15 

69.00 

1,548 

106,605 00 

(3,731.18) 

(7,163 41) 

(2,975.01) 

92,635.39 

162,225 00 

61,182.00 

s $ 

s 

s 

r 

Fuel price/gallon averag, • $ 

Advertising per pax {r/t 

Credit card fe 

Travel Agent Commission 

) $ 

. 

" 

ill! 4.3 

6 

14 

103 

0 90 

92 70 

50'~ 

30 

15 

69.00 

1,548 

106,605 00 

(3,731.18) 

(7,263 41) 

(1,975 02) 

92,635.39 

162,225 00 

61,182 00 

load Facto 

*Percent of OTA Sale s 

A!!& 4 3 

6 

24 

103 

0.90 

92 70 

50% 

30 

15 

69.00 

l,S48 

106,605 00 

(3,731.18) 

(7,163 41) 

(2,975 01) 

92,635.39 

162,225 00 

61,18200 

~ 

1,750.00 

500 00 

545 00 

1 

3 

165 

400 

500 

3.50% 

!()% 

SO'~ 

30% 

4.3 

6 

14 

W3 

0.90 

92.70 

50% 

30 

IS 

69.00 

1,548 

10-6,605 00 

(3,73118) 

(7,263 41) 

(2,975 01) 

92,635.39 

162,225 00 

61,182 00 

per turn 

per turn 

per day 

per day 

Q>! 

43 

6 

M 

W3 

0~ 

~ro 

50'~ 

w 

~ 

ROO 

L~ 

!06,605 00 

(3,73118) 

(7,163 41) 

(2,975 01) 

92,635.39 

162,125 00 

61,182 00 

54,48100 $ 54,48100 $ 54,481.00 $ 67,983.00 $ 67,983.00 $ 67,983 00 $ 67,983 00 $ 67,983 00 $ 67,983.00 

10,000 00 $ 10,00000 $ 10,000.00 $ $ $ $ $ $ 

$ I 354 ?<J $ 1354 50 $ 1 35450 $ 2 322.00 $ 2 312 00 $ 2 322 00 $ 1 312 00 $ l 321 00 $ 2 312 00 

$ 201,375.50 $ 201,375.50 $ 201,375.50 $ 293,712.00 $ 293,7U.OO $ 293,712.00 $ 193,712.00 $ 293,712.00 $ 293,712.00 

4,515J)0 

6,772 so 2,000 00 

13,287.50 

214,663.00 

($160,700.49) 

4,515 00 

6,772 so 

1,000 00 

13,287.50 

214,663.00 

($160,700.49) 

4,515 00 

6,772.50 

1,000 00 

13,287.50 

214,663.00 

($160,700.49) 

7,740 00 

11,610.00 

2,000 00 

21,350.00 

315,062.00 

(222,426.61) 

7,740 00 

11,610 00 

1,00000 

21,350.00 

315,062.00 

(222,426.61) 

7,740 00 

11,610 00 

2,000 00 

21,350.00 

315,062.00 

(222,426.61) 

7,740 00 

11,610 00 

1,000 00 

21,350.00 

315,062.00 

(222,426.61) 

7,740 00 

11,610 00 

2,00000 

21,350.00 

315,062.00 

(122,426.61) 

7,740 00 

11,610-C}() 

1,000.00 

21,350.00 

315,062.00 

(222,426.61) 

Catering + per pa • $ 

Reservation cost/pa 

Percent of GOS booking 

Operational Days Per Week 

call Cente 

Avg. Passenger Fare 

Deicing 

Seats per flight 

Departures per week (o/w) 

Departures per week (r/t) 

Block Hours Per Segment {avg) 

• $ 

s 

<: 

r; $ 

$ 

$ 

30 

24 

11 

0.90 

1.50 

15.00 

2 

6 

1,000.00 

69.00 

•r ARP Comm1swn Agreements negotiated Sepeartely 

!W: 4.3 

7 

14 

60 

0 90 

54 00 

50'~ 

30 

15 

69.00 

903 

62,100.00 

(1,173.50) 

(4,230 97) 

(1,733 01) 

53,962.51 

99,900 00 

35,640 00 

~ 

4.3 

14 

60 

0.90 

54.00 

50% 

30 

15 

69.00 

903 

62,100.00 

(2,173.50) 

(4,130 97) 

(1,733 02) 

53,962.51 

99,900 00 

35,64000 

Ywl1! 51.60 

978 

880.10 

14,706 

1,012,230.00 

(35,418.05) 

(68,966.17) 

(18,148.28) 

879,587.40 

1,572, 750.00 

580,932.00 

54,48100 $ 54,48100 $ 734,784 00 

10,000 00 $ 10,000 00 $ 60,000 00 

$ I 30450 $ I 354 50 $ 12 059.00 

$ 201,375.50 $ 201,375.50 $ 2,970,525.00 

4,515 00 

6,772.50 

2,000 00 

13,287.50 

214,663.00 

($160,700.49) 

4,515.00 

6,772.50 

2.000.00 

13,287.50 

214,663.00 

($160,700.49) 

73,530.00 

110,295.00 

24,000.00 

207,825.00 

3,178,350.00 

($2.298,762.60) 
CHMTCKAUI 

Fare Range: 

Aircraft: 

Aircraft Base: 

!ttl!! 

Weeks per Month 

Days per Week 

Depts per Week 

Depts per Month 

Avg. Block per Leg 

Ttl Block per Month 

Load Factor 

Seats per flight 

Pax per fllght 

Avg. Pax Fare 

Ttl Pax per Month 

$ 

--·'' $ 

And 

..o£&UBLIC 

~TERS,INC 

49.oo I 

Bae-3100 Jetstream I ... ., .. 1 $ 

Seats: 19

149.00 I MBL 

Schedule: lOx flights round trip per week average 

D!J!1 

MBL 

MOW 

MBL 

MOW 

Mn 

4.3 

5 

20 

86 

0.90 

77.40 

65% 

19 

12 

69.00 $ 

1,032 

Arrll!!l, 

7:25AM MOW 

11:00 AM MBL 

1:30PM MOW 

6:00PM MBL 

TIMES ARE FLEXIBLE 

8!!1 

4.3 

5 

20 

86 

0.90 

77.40 

65% 

19 

12 

69.00 $ 

1,032 

M 

4.3 

5 

20 

86 

0.90 

77.40 

65% 

19 

12 

69.00 $ 

1,032 

7:25AM 

1:00PM 

1:30PM 

8:00PM 

&!.& 

4.3 

5 

20 

86 

0.90 

77.40 

65% 

19 

12 

69.00 $ 

1,032 

Stops 

0 

0 

0 

0 

kll. 

I 

I 

. 

. 

' 

4.3 

5 

20 

86 

0.90 

77.40 

65% 

19 

12 

69.00 $ 

1,032 

Q&1 

4.3 

5 

20 

86 

0.90 

77.40 

65% 

19 

12 

69.00 $ 

1,032 

MBL Service to MOW 

ACMI incl. Hotel & per diem 

Destin. Ground Fees 

Origin Ground Fees 

Oestinaton Turns 

Origination Turns 

Fuel burn/hou 

$ 

$ 

$ 

' $ 

I $ 

' 

: 

: 

1,525.00 I 

450.00 

545.00 

2 

3 

110 

4.00 

5.00 

3.50% 

10% 

65% 

Fuel price/gallon average 

Advertising per pax (r/t 

Credit card fee 

Travel Agent Commission 

Load Factor 

**Percent of OTA Sale ) ____ ......... ~ 

per turn 

per turn 

per day 

per day 

*including CRS fees 

Catering • per pax 

*Reservation cost/pax 

Percent of GDS booking· 

Operational Days Per Week 

Call Center 

Avg. Passenger Fare 

Deicing 

Seats per flight 

Departures per week (o/w) 

Departures per week (r/t) 

Block Hours Per Segment (avg) 

' : 

**TARP Commision Agreements negotiated seperately with each Travel Agency 

li2l! 

4.3 

5 

20 

86 

0.90 

77.40 

65% 

19 

12 

69.00 $ 

1,032 

Dec lA!J. ~ Mar 

4.3 

5 

20 

86 

0.90 

77.40 

65% 

19 

12 

69.00 $ 

1,032 

4.3 

5 

20 

86 

0.90 

77.40 

65% 

19 

12 

69.00 $ 

1,032 

4.3 

5 

20 

86 

0.90 

77.40 

65% 

19 

12 

69.00 $ 

1,032 

4.3 

5 

20 

86 

0.90 

77.40 

65% 

19 

12 

69.00 $ 

1,032 

4.3 

5 

20 

86 

0.90 

77.40 

65% 

19 

12 

69.00 

1,032 

$ 

$ 

$ 

$ 

$ 

1.50 

15.00 

2 

5 

2,000.00 

69.00 

5 000.00 

19 

20 

10 

0.90 

Year Ttl 

51.60 

1032 

928.80 

12,384 

Ticket Rev. $ 71,208.00 $ 71,208.00 $ 71,208.00 $ 71,208.00 $ . 71,208.00 $ 71,208.00 $ 71,208.00 $ 71,208.00 $ 71,208.00 $ 71,208.00 $ 71,208.00 $ 71,208.00 $ 854,496.00 

Credit Card Fee $ (2,492.28) $ (2,492.28) $ (2,492.28) $ (2,492.28) $ (2,492.28) $ (2,492.28) $ (2,492.28) $ (2,492.28) $ (2,492.28) $ (2,492.28) $ (2,492.28) $ (2,492.28) $ (29,907.36) 

FET & 7.5% $ (4,851.90) $ (4,851.90) $ (4,851.90) $ (4,851.90) $ (4,851.90) $ (4,851.90) $ (4,851.90) $ (4,851.90) $ (4,851.90) $ (4,851.90) $ (4,851.90) $ (4,851.90) $ (58,222.80) 

Agent Comm. $ (1,987.20) $ (1,987.20) $ (1,987.20) $ (1,987.20) $ (1,987.20) $ (1,987.20) $ (1,987.20) $ (1,987.20) $ (1,987.20) $ (1,987.20) $ (1,987.20) $ (1,987.20) $ (23,846.40) 

Ttl Op. Revenue $ 61,876.62 $ 61,876.62 $ 61,876.62 $ 61,876.62 $ 61,876.62 $ 61,876.62 $ 61,876.62 $ 61,876.62 $ 61,876.62 $ 61,876.62 $ 61,876.62 $ 61,876.62 $ 742,519.44 

Direct Operating Cost 

ACMI $ 118,035.00 $ 118,035.00 $ 118,035.00 $ 118,035.00 $ 118,035.00 $ 118,035.00 $ 118,035.00 $ 118,035.00 $ 118,035.00 $ 118,035.00 $ 118,035.00 $ 118,035.00 $ 1,416,420.00 

Fuel $ 34,056.00 $ 34,056.00 $ 34,056.00 $ 34,056.00 $ 34,056.00 $ 34,056.00 $ 34,056.00 $ 34,056.00 $ 34,056.00 $ 34,056.00 $ 34,056.00 $ 34,056.00 $ 408,672.00 

Ground $ 54,502.50 $ 54,502.50 $ 54,502.50 $ 54,502.50 $ 54,502.50 $ 54,502.50 $ 54,502.50 $ 54,502.50 $ 54,502.50 $ 54,502.50 $ 54,502.50 $ 54,502.50 $ 654,030.00 

Deicing $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 5,000.00 $ 60,000.00 

Catering $ 1.548.00 $ 1.548.00 $ 1,548.00 $ 1.548.00 $ 1,548.00 $ 1,548.00 $ 1,548.00 $ 1.548 00 $ 1,548.00 $ 1,548.00 $ 1.548.00 $ 1,548.00 $ 18,576.00 

Ttl Direct Op. Cost $ 213,141.50 $ 213,141.50 $ 213,141.50 $ 213,141.50 $ 213,141.50 $ 213,141.50 $ 213,141.50 $ 213,141.50 $ 213,141.50 $ 213,141.50 $ 213,141.50 $ 213,141.50 $ 2,557,698.00 

Indirect Operationlng Costs 

Advertizing $ 5,160 00 $ 5,160.00 $ 5,160.00 $ 5,160.00 $ 5,160.00 $ 5,160.00 $ 5,160.00 $ 5,160.00 $ 5,160.00 $ 5,160.00 $ 5,160.00 $ 5,160.00 $ 61,920.00 

Reservation/GO$ $ 7,740.00 $ 7,740.00 $ 7,740.00 $ 7,740.00 $ 7,740.00 $ 7,740.00 $ 7,740.00 $ 7,740.00 $ 7,740.00 $ 7,740.00 $ 7,740.00 $ 7,740.00 $ 92,880.00 

Call Center $ 2,000.00 $ 2,000.00 $ 2,000.00 $ 2,000.00 $ 2,000.00 $ 2,000.00 $ 2,000.00 $ 2,000.00 $ 2,000.00 $ 2,000.00 $ 2,000.00 $ 2,000.00 $ 24,000.00 

Ttl Indirect Op. Cost $ 14,900.00 $ 14,900.00 $ 14,900.00 $ 14,900.00 $ 14,900.00 $ 14,900.00 $ 14,900.00 $ 14,900.00 $ 14,900.00 $ 14,900.00 $ 14,900.00 $ 14,900.00 $ 178,800.00 

Ttl Op. Cost $ 228,041.50 $ 228,041.50 $ 228,041.50 $ 228,041.50 $ 228,041.50 $ 228,041.50 $ 228,041.50 $ 228,041.50 $ 228,041.50 $ 228,041.50 $ 228,041.50 $ 228,041.50 $ 2,736,498.00 

Operating P /l $ (166,164.88) $ (166,164.88) $ (166,164.88) $ (166,164.88) $ (166,164.88) $ (166,164.88) $ (166,164.88) $ (166,164.88) $ (166,164.88) $ (166,164.88) $ (166,164.88) $ (166,164.88) $ (1,993,978.56)