# Ai rChoic e On e 1230 0 oi a Tesso n Roa d Suit e 200- F St . Louis , Missour i 6312 8 Piione : 314-843-850 1 Marc h 21 , 201 2 Mr . Denni s DeVan y Chief , Essentia l Ai r

Servic e Progra mr~: ; Offic e o f Aviatio n Analysi s ^ ~ ^ X ; Departmen t

o f Transportatio n ;] f Ij'-:^ S 120 0 Ne w Jerse y Avenue , S E rs j -xjQ^ t Washington , D.C . 2059 0 - ^ §§ 3 B y emai l an dfiling i n Docke t DOT-OST-2009-030 0 - ^ p::^-' ^ fs J C O I Dear Mr . DeVany : Thi s lette r

responds t o th e lette r

tha t yo u receive dfi-omth e Cit y o f Alpena , Michigan , date dMarc h 15,2012. ' Ai r Choic e On e recognize s th e importanc e th e City place s o n finding asatisfactory replacemen t for Delta' s schedule dai r

service . We hav e develope dproposal s for replacemen t

servic e tha t

wil l mee t Alpena' s need s an dallo w ai r service s t o thriv e an dpromot e th e communit y economically . A s yo u know , w e hav e show n ou r ability t o improv e servic e an dincreas e traffic , whic h i s wh y th e communitie s w e serv e enthusiasticall y support us . W e ar e committe dt o continu e t o wor k wit h th e City o f

Alpen aan dwis h t o se t

th e recor dstraigh t

o n tw o points . First , ou r

propose dOptio n 4 - aservic e operatin g betwee n Alpen aan dChicago O'Har e Internationa l Airpor t

thre e time s ada y usin g twin-engin e equipmen t ~ exceed s th e minimu m requirement s o f

basi c essentia l ai r

service . Second , Ai r

Choic e On e ha s recentl y ha dit s contrac t renewe dfor

Burlingto n an dDecatur , aone-year renewa l wit h an uiducemen t o f thre e year s t o follo w i f w e implemen t

an electroni c ticketin g agreemen t wit h amajo r

carrier . Th e community' s mistake n understandin g o f

thi s lur e a s "probation " i s wrong . 1 . Ou r Optio n 4 exceed s th e minimu mrequirement s fo r basi c essentia l ai r

servic e unde r curren t law . Th e City contends tha t

ou r propose doptio n 4 doe s not mee t th e minimu mEA S servic e definition . Thi s i s incorrect . Th e la w guarantee s acommunit y ai r servic e t o ahu b airport

wit h 1 2 roun dtrip s a week , usin g twin-engin e aircreift. ^ Ou r proposa l woul dgiv e Alpen aou r highl y reliable , market

teste d1 8 roim dtrip s pe r

wee k wit h twin-engin e aircraf

t t o Chicago O'Har e Intemationa l Airport , on e o f th e world' s busiest

airports , wit h thousand s o f connectin g opportunities . Maximu mPayload . Th e City question s whethe r ou r propose dequipment , th e Pipe r Navajo , ca n carry mor e tha n four

passenger s wit h th e fiiel require dt o trave l fro mAlpen at o Chicago o n day s wit h les s tha n perfec t

conditions . W

e ca n assur e th e Departmen t an dth e Cit

y tha t th e Navaj o ca n carr y seve n passengers , thei r bags , an dal l necessar y fiael o n suc h days . T o th e exten t

necessary . Ai r

Choic e On e seek s leav e t o fil e thi s otherwis e unauthorize dresponse . See , Orde r

2012-1- 6 a t

p . 4 n . 6 . 1159035V 1Ai r

Choic e On e ha s ahighl y skille dtea mo f flight operatio n an dmaintenanc e expert s wh o brin g a combine dresourc e o f

mor e tha n 6 0 year s servic e t o th e industry . I n preparin g ou r Alpen a proposal , w e performe dall th e require dcalculations , usin g conservativ e performanc e estimates . Base do n ou r

experienc e i n operatin g th e Navajo , w e expec t t o carr y seve n passenger s betwee n Alpen aan dChicago O'Har e a t standar dairlin e weight s wit h fiilly loade daircraft . Ou r calculation s assum e that , i n additio n t o seve n passengers , w e wil l carr y 25 0 lbs . o f passenge r baggage . And , consisten t wit h Federa l Aviatio n Regulation s an dou r FAA-approve dmanuals , w e assume dtha t

th e Navaj o woul dcarr y at leas t all/ 2 hou r

fiiel reserv e wit h afull y loade daircraf t upo n reachin g Chicag o O'Har e t o ensur e tha t i t coul dreac h an approve dalternat e airport o n ada y wit h les s tha n perfec t

conditions . Schedule dFligh t

Times . Th e City suggest s tha t ou r schedule dflight

tim e i s unrealistic . W

e operat e areliable , on-tim e professiona l service . I n preparin g abid , w e us e areasonabl e averag e flight time , base do n ou r

assessmen t

o f th e flight time s throughou t

th e year . W

e conside r th e effec t o f weathe r an dothe r

factors . Publishe dschedule s for othe r citie s wit h differen t

stag e length s an dtraffi c pattern s canno t b e use dt o evaluat e a"Representativ e Schedule, " sinc e publishe dschedule s reflec t day-to-da y experienc e i n th e actua l operatin g conditions . 2 . Th e Departmen t

ha s jus t offere du s th e lur e o f

a3-yea r renewa l i f

w e ca n implemen t

a n electroni c interlin e ticketin g agreemen t wit h amajo r

carrier . W e ar e no t

o n "probation " an d ther e i s n o threa t

t o withdra w th e awar da t th e en do f

th e year . Th e City contends tha t

w e ar e "o n probation, " citin g th e Department' s decisio n t o giv e Ai r Choic e On e an additiona l one-yea r contrac t for Burlingto n an dDecatur . Th e Department' s awar dsai d nothin g o f

th e kind . Instead , i t

recognize dth e critica l importanc e o f electroni c interlin e agreement s t o reducin g progra mcost s an dincreasin g efficienc y an dchallenge du s t o continu e ou r wor k toward tha t goal . Ai r

Choic e On e share s tha t

goa l an dha s bee n workin g ver y hardt o mee t it . Th e Departmen t

di dno t threate n t o revok e Ai r

Choic e One' s authority , a s th e City' s statemen t implies . Instead , i t

hel dout , a s acarrot , th e inducemen t o f afurther extensio n o f

thre e year s i f

w e ca n reac h agreemen t

wit h amajo r

carrier . Departmen t

Orde r 2011-12-1 7 doe s not

foreclos e an y option , includin g renewal . Indeed , th e Departmen t

ha s lon g bee n awar e tha t establishe dcarrier s ca n bloc k ne w entran t competitio n b y refusin g t o interlin e wit h the m- eve n i n market s abandone db y majo r carriers . Thi s ha s impose dcost s o n th e EA S program , bot h b y limitin g valuable flow traffi c an ddiscouragin g participation . A s th e Departmen t recognize di n it s 199 9 testimon y o n thi s topic , th e major s are , a t

best , reluctan t

t o hav e thei r

commute r

code-shar e partner s involve di n th e program , an di t

i s very difficul t

for prospectiv e ne w entrants , withou t code-shar e affiliations , t o gai n atoehol di n th e market . Becaus e avita l elemen t o f th e progra mha s bee n th e competitiv e biddin g process , th e deart h o f participatin g carrier s ha s undoubtedl y resulte di n ou r payin g highe r

subsidie s tha n migh t

otherwis e b e necessary." ^ Hearin g befor e th e Senat e Committe e o n Commerce , Scienc e an dTransportation , "Th e Stat e o f Schedule dAi r Servic e at Smal l Communities, " Testimon y o f Denni s DeVany , Chief

, EA S & Domesti c Analysi s Division , U.S . Departmen t

O f Transportation , Septembe r 10 , 1999 . Se e also , H RRep . 106-513 , f 64 , describin g propose drequirement s tha t dominan t

carrier s dealin g with EA S providers ; Pub . L . No . 108-176 , § 406 , directin g DO T t o se t up pilo t progra mt o 1159035V1

### Agains t

thi s background , it

wouldno t b e i n th e Department' s interes t to furthe r reduc e a n EA S provider' s negotiatin g leverag e b y threatenin g t

o withdra w arout e awar di f tha t provide r wer e unabl e t o conclud e a n interlin e arrangemen

t wit h amajo r carrier . I n an y event , whe

n th e time come s to renew . Ai r Choic e On

e will b e prepare dto review wit h the Departmen

t it s efforts i n achievin g a

n interlin e agreemen

t wit h amajo r carrie r andi s confiden

t tha t th e Departmen

t wil l rewar

dthos e efforts by renewin g ou r contract . W e ar e gratefiil fo

r thi s opportunit

y to correc t

the recor dan dask th e Departmen

t t o awar du s th e EA S contract

fo r Alpena , a s it

meet s th e statutor

y requirement s an

dwil l mee t th e curren t air servic e need s in Alpena .

Shan e Stor z CE O Ai r Choic e On e 

### Cc : Th e Honorabl e Matthew J . Aligora , Mayor , Cit y o f Alpena , Michiga

n Rober t S . Goldner , DO

T

requir e majo r carrier s to interline wit

h EAS providers , an

dDO T Notic e datedFebruar

y 1 , 2006 , establishing sai d program . 1159035V 1