Order: 2014-10-21 Served: October 24, 2014



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 24 th day of October, 2014

Essential Air Service at

BRADFORD, PENNSYLVANIA FORT DODGE, IOWA FRANKLIN/OIL CITY, PENNSYLVANIA GREENVILLE, MISSISSIPPI JACKSON, TENNESSEE MACON, GEORGIA MERCED, CALIFORNIA MUSCLE SHOALS, ALABAMA

Under 49 U.S.C. 41731 et seq

. Docket DOT-OST-2003-14528

Docket DOT-OST-2001-10682

Docket DOT-OST-1997-2523

Docket DOT-OST-2008-0209

Docket DOT-OST-2000-7857

Docket DOT-OST-2007-28671

Docket DOT-OST-1998-3521

Docket DOT-OST-2000-7856

ORDER SELECTING CARRIERS AN D REQUESTING PROPOSALS

Summary By this Order, the Department is selecting carr iers to provide Essential Air Service (EAS) to

serve Bradford and Franklin/Oil City (“Franklin”), Pennsylvania, Fort Dodge, Iowa, Greenville, Mississippi, and Muscle Shoals, Alabama. Sun Air Express, LLC d/b/a Sun Air International (“Sun Air”) is being selected to serve Bradford and Franklin, S eaPort Airlines, Inc. (“SeaPort”) to serve Greenville and Muscle Shoals, and Mul ti-Aero, Inc. d/b/a Air Choice One (“Air Choice One”) to serve Fort Dodge.

Also by this Order, we are requesting propos als for EAS at Jackson, Tennessee, and Macon, Georgia. Proposals are due November 24, 2014.

Background

The FAA Modernization and Reform Act of 2012 amended 49 U.S.C. § 41731(a)(1)(B) to change the definition of “eligible place” for the purpose of receiving EAS. The amendment states that to be eligible, a co mmunity must maintain an average of 10 enplanements or more per service day, as determined by the Secretary, durin g the most recent fiscal year beginning after September 30, 2012. The legislation exempts loca tions in Alaska and Hawaii and communities- 2 -

that are more than 175 driving miles from the nearest large or medium hub airport. 1 The Secretary also has the authority to waive the 10 -enplanement standard, on an annual basis, if the community can demonstrate that the reason the location averages fewer than 10 enplanements per day is due to a temporary decline in enplanements. 2

By Order 2014-4-26, issued on April 24, 2014, the Department issued a show-cause Order directing interested parties to submit objections to the Department’s tentative findings that 13 EAS communities, including the 8 communities discussed in this Order, enplaned fewer than 10 passengers per day. In response to that Order, th e Department received objections to the showcause Order from 11 of the 13 communities, but none of those objections disputed our findings that they enplaned fewer than 10 passengers per day during FY 2013.

On June 24, 2014, the Department finalized its tent ative decision, and set procedures for waiver petitions, with a due date of July 24, 2014.

Of the 13 communities found ineligible for subsidi zed service based on the requirement that they enplane 10 or more passengers per service day, 12 communities filed petitions for waivers. Athens, Georgia did not file a waiver petition. 3

On September 26, 2014, by Order 2014-9-21, the Depart ment granted the waiver petitions from all 12 communities. El Centro, Hagerstown, Ki ngman, and Lancaster have existing rates and carriers in place. The other 8 communities list ed above require action by the Department to

secure service which is detailed below.

BRADFORD AND FRANKLIN/OIL CITY Summary of Proposals

Boutique Air Boutique proposed 18 weekly nonstop round trips to Pittsburgh International Airport (PIT) at

Bradford and Franklin at an annual s ubsidy of $1,590,467 and $1,287,147 respectively, with a nine-passenger, single-engine, Pilatu s PC-12, or Beechcraft B200 aircraft.

City Link Air At Bradford the carrier proposed 18 weekly r ound trips to PIT along with Greenbrier/White Sulphur Springs, West Virginia, at a comb ined annual subsidy of $4,691,407, with ninepassenger Beech 200/300 aircraft. The carrier did not propose Bradford or Franklin as a

standalone or in combination with each other. At Franklin, they propos ed 24 weekly round trips to PIT along with Dubois, Pennsylvania at a combined annual subsidy of $3,213,334, however, DuBois, was previously selected in Order 2014-7-11, and issued July 18, 2014.

1 49 U.S.C. § 41731(c) & (d).

2 49 U.S.C. § 41731(e).

3 See www.regulations.gov and access each community’s waiver petitions by entering “DOT-OST-[each respective community’s docket number as described on page 1].- 3 -

Sun Air Sun Air proposed to provide Bradford with 24 weekly nonstop round trips to PIT at an annual subsidy request of $1,974,226. At Franklin, the ai r carrier offered 19 weekly nonstop round trips to PIT, at an annual subsidy of $1,442,788. Both communities would be served with 8-passenger Piper Chieftain aircraft.

Community Comments On May 28, 2014, the Department re-solicited co mments from the communities regarding this carrier-selection case, and they are summarized below.

Airport Director Tom Frungillo of the Bradfor d, Pennsylvania, Regional Airport Authority and Airport Manager Otho Bell, of the Venango Regional Airport (Franklin, Pennsylvania), supported Sun Air. A joint letter received fr om the Bradford Regional Airport, and Venango County Airport, unanimously supported Sun Air. Among the reasons the communities provided for recommending Sun Air were their current carrier’s (Silver Airways) unreliable service and its many years of decreasing passengers. The Pe nnsylvania Air Service committee conducted a multi-year study that showed that low-fare, high frequency, reliable air service to Pittsburgh, Pennsylvania, a medium-hub airport, on smaller aircraft, would increase passenger levels. The communities also stated that they are not willing to waive their ri ghts to twin-engine aircraft.

Decision First, because City Link Air doe s not currently hold the requis ite economic authority from the Department to operate the scheduled air servi ce it proposed and it did not receive any community support, the Department will not co nsider its proposal further.

With regards to Boutique Air, which proposed single-engine aircraft, none of the communities where it proposed service waived their right to twin-engine aircraft.

Therefore, Sun Air is the only carrier with a prop osal that offers twin-e ngine aircraft and is supported by Bradford and Franklin. The Depart ment finds Sun Air’s proposal reasonable for the service to be provided. The Department has increasingly heard that these communities wish

to return their service to P ittsburgh, and Sun Air, along with a coalition of stakeholders, including Pittsburgh International Ai rport, promise to make this service attractive to passengers, with interline ticketing and baggage transfer, and more frequent se rvice using aircraft with fewer seats than the previous carrier.

By this Order, the Department is selecting Sun Air to provide EAS at Bradford and Franklin, for a two-year term, from November 1, 2014 throug h October 31, 2016, for an annual subsidy of $2,045,826, and $1,442,788. The carrier will provide 24 weekly nonstop round trips to PIT at Bradford, and 19 weekly nonstop round trips to PI T at Franklin, utilizi ng an 8-passenger Piper Chieftain aircraft. Although Sun Air proposed a four-year term for both Bradford and Franklin, the Department is selecting the carrier to serve the communities for two years. Since Bradford

and Franklin both received a waiver from the 10-enplanement requirement 4 , their eligibility status is not yet determined. The Department wi ll assess Bradford and Franklin’s enplanements

4 See Order 2014-9-21- 4 -

based on data from October 1, 2014, through September 30, 2015, and make an eligibility

determination once that data has been reviewe d. Additionally, both communities are subject to the $200 per passenger subsidy cap and compliance w ith that requirement will also be measured from October 1, 2014, through September 30, 2015 (see www.regulations.gov , DOT-OST-2014- 0061).

FORT DODGE Summary of Proposals

Fort Dodge and Mason City, Iowa, have traditio nally been served as a package by the same carrier. As a result, the Department has tradit ionally requested proposals for both communities. However, at the time the Mason City case was decided, the long-term st atus of Fort Dodge’s eligibility was unclear. By Order 2014-8-16 ( August 18, 2014), the Department selected Air Choice One to provide 24 nonstop round trips a week to Chicago O’Hare with 8-passenger Piper Navajos or 9-passenger Cessna Ca ravan aircraft for two years, at an annual subsidy of $4,290,533. Now that the Department has granted a waiver for Fort Dodge to remain in the program through at least fiscal year 2015, we will consider the proposals to serve Fort Dodge as

well as revisit Air Choice One’s options to serve both communities.

Summary of Proposals

Great Lakes

Great Lakes submitted a proposal for Fort Dodge for a two-year term with service to Minneapolis-Saint Paul Interna tional Airport (MSP). Their proposal consists of using 19- passenger, Beech 1900D aircraft reconfigured for 9-passengers, for 18 weekly round trips to MSP at an annual subsidy rate of $2,900,559 or $2,298,018 for its 19-seat “Plus” option, which

assumes that the aircraft can be re turned to a 19-passenger configuration.

Proposal of Air Choice One

Air Choice One submitted a number of proposals to serve Fort Dodge and Mason City, some of which were stand-alone proposals and some of which were insepa rable packages to serve both communities. Air Choice One submitted a propo sal for Fort Dodge consisting of two options, both using 9-passenger Cessna Grand Caravan or 8-passenger Piper Na vajo aircraft. Option 1 is for 18 weekly round trips to Lambert-St. Louis Inte rnational Airport (STL) at a first year annual subsidy of $3,644,109 and a two through four year annual subsidy of $3,560,103. Option 2 is for 18 weekly round trips to St. Louis, for year one, and 24 weekly round trips, for years two through four, for a first year annual subsidy of $3,644,109, and a two through four year annual subsidy of $4,069,592. However, the carrier also submitted combined, two-city package proposals that we can now consider. The mo st attractive proposal for both communities comprises 24 round trips a week for Mason City (24 non-stops to ORD) and 24 round trips a week for Fort Dodge (24 non-stops to STL) for a combined annual subsidy of $7,431,905. The carrier also submitted an option in which bot h communities would receive 18 or 24 round trips per week for a combined annual subsidy of $6,940,841.- 5 -

Community Comments On June 3, 2014, the Department solicited comments from the communities regarding this air

carrier selection case. Mason City supported 24 round trips per week to ORD. We received a letter from Matt Bemrich, Mayor of Fort Dodge , and Richard Jacobson, Chairman of the Fort Dodge Airport Commission, supporting Air Choice One’s proposals. Among the reasons the community supports Air Choice One is the marketing support provided by STL, along with the enplanement and reliability history of Air Choi ce One in the communities it currently serves, and the limited choices of the proposals submitted.

Decision The Department has decided to select Air Choice One’s combined city option that will provide Fort Dodge with 24 nonstop round trips a week to STL and will continue to provide Mason City with 24 nonstop round trips a week to ORD. This option provides the most economical service combination while still giving both communities their preferred option. For this option, Air Choice One has requested a combined annual subsidy of $7,431,905. Since Air Choice One has already been selected to serve Mason City for $4,290,533, the incremental subsidy for Fort Dodge is $3,141,372, far less than any of the Fort D odge stand-alone options. However, because this selection now becomes a two-city pack age, the payout formulas will be adjusted accordingly.

The Department makes this sele ction of Air Choice One at Fo rt Dodge contingent upon the Department’s receipt of properly executed certifications from th e air carrier that it is in compliance with the Department’s regulat ions regarding drug-free workplaces and nondiscrimination, as well as the regula tions concerning lobbying activities

.

GREENVILLE AND MUSCLE SHOALS Summary of Proposals

Proposal of Air Choice One Air Choice One submitted proposals for Greenville and Muscle Shoals that were combined, “allor-nothing” packages and stand- alone options. The combined packages also included Tupelo, Mississippi, and were contingent on all three co mmunities being selected. However, since action

was deferred at Greenville and Muscle Shoals pending a decision from th e Secretary regarding their request for a waiver from the 10-enplanemen t rule, the Department proceeded with an air carrier selection at Tupe lo. As a result, the combined p ackages that Air Choice One proposed that included Tupelo are null since an air carrier has already been selected there. Therefore, a summary is provided only for the main components of the airline’s options that were not contingent on Air Choice On e being selected at Tupelo.

At Greenville, Air Choice One proposed two opt ions using 9-passenger Cessna Grand Caravan or 8-passenger Piper Navajo aircraft. Option 1 is for 18 weekly round trips to Memphis (MEM) at a first year annual subsidy of $2,306,246 and a two through four year annual subsidy of $2,171,191. Option 2 is for 18 weekly round trips to MEM at a first year annual subsidy of $3,906,312 and 24 weekly round trips to MEM for year s two through four at an annual subsidy of $2,538,575.- 6 -

At Muscle Shoals, Air Choice One proposed two options using 9-passenger Cessna Grand Caravan or 8-passenger Piper Navajo aircraft. Option 1 is for 18 weekly round trips to Nashville (BNA) at a first year annual subsidy of $2,283,993 and a two through four year annual subsidy of $2,160,268. Option 2 is for 18 week ly round trips to BNA at fi rst year annual subsidy of $2,283,993 and 24 weekly round trips to BNA for years two through four at an annual subsidy of $2,428,932.

Proposal of SeaPort SeaPort proposed to provide service at Greenvill e and Muscle Shoals us ing 9-passenger singleengine Cessna Caravan aircraft . At Greenville, SeaPort pro posed 18 weekly nonstop round trips to MEM for an annual subsidy of $1,483,080. At Muscle Shoals, SeaPort proposed 24 weekly nonstop round trips to BNA for an annual subsidy of $1,739,308.

Proposal of Sun Air Sun Air proposed to provide service at bot h communities to MEM using 8-passenger Piper

Chieftain aircraft. At Greenvi lle, the airline proposed four weekday and two weekend nonstop round trips (24 per week) for an annual subsi dy of $2,279,486. At Muscle Shoals, the airline proposed three daily nonstop round trips (21 per week) for an annual subsidy of $2,041,998.

Community Comments On June 3, 2014, the Department solicited co mments from Greenville and Muscle Shoals regarding this air carrier selecti on case. In response, we received letters from Mr. Andrew N. Alexander III, City Attorney for Greenville, and The Honorable David H. Bradford, Mayor of

Muscle Shoals.

Both Greenville and Muscle Shoals supported the proposal put forth by SeaPort, citing that the required annual subsidy was less than the other ai rline proposals, and that the communities were confident that the airline’s freque nt service to the stated hubs will generate traffic in excess of 10 enplanements per day. In addition, both commun ities believed SeaPort’s proposed service will bring the communities’ subsidy per passenger under the $200 cap.

Decision

Both Greenville and Muscle Shoa ls support the proposal put for by SeaPort, and the Department finds the service and subsidy levels to be r easonable (in fact, thei r subsidy request is considerably less than what was proposed by Air Choice One and Sun Air). Therefore, the Department will select SeaPort to provide EAS atGreenville and Muscle Shoals for a new, twoyear term.

This selection of SeaPort is contingent upon the Department’s receipt of properly executed

certifications from the air carrier that it is in compliance with the Department’s regulations regarding drug-free workplaces and nondiscrimina tion, as well as the regulations concerning lobbying activities

.- 7 -

JACKSON By this Order, the Department is requesting proposals from air carriers interested in providing EAS at Jackson, Tennessee, for a new term, with or without subsidy supp ort; Proposals are due November 24, 2014. (See Appendix A for a map.)

Background on Jackson By Order 2011-12-15, issued on December 22, 2011, th e Department selected SeaPort Airlines, Inc. (“SeaPort”) to provide subsidized EAS at Jackson with nine-seat Cessna Grand Caravan aircraft for a one-year period thr ough the end of the 12th month thereafter, at an annual subsidy rate of $1,149,703. SeaPort inaugur ated service at Jackson on January 22, 2012, thus making the original expiration date January 31, 2013. By Order 2013-2-23, issued on February 25, 2013, the Department extended SeaPort’s contract at Jackson for an additional year, from February 1, 2013, through January 31, 2014, at a subsidy rate of $1,115,210, as described in SeaPort’s original proposal to serve Jacks on. Additionally by subsequent Orders, the Department extended SeaPort’s service obliga tion until January 31, 2015, at the same subsidy rate of $1,115,210. By Order 2014-10-2, October 9, 2014, the Department again extended
SeaPort’s rate, thr ough February 28, 2015.

The complete public file for EAS at Jacks on may be accessed online through the Federal Dockets Management System at: http://www.regulations.gov by entering “DOT-OST-2000-

7857” in the “SEARCH for: Rule s, Comments, Adjudications or Supporting Documents:” field.

Request for Proposals SeaPort has been under contract with the Department for over two years, and its rate has expired. The carrier also requested incr eased compensation for its serv ice at Jackson on September 30, 2014. Therefore, the Department is requesting pr oposals from air carriers interested in providing EAS at Jackson, with or without subsidy support, for a new contract te rm. Air carriers should file their proposals no later than November 24, 2014. After that date, the proposals will be decided, thereby making them public. Additionall y, the Department reque sts each air carrier serve a copy of its proposal on the civic par ties at the above communities and on the other applicants. Shortly afterwards , a summary of the proposals will be provided to the communities asking them to submit any formal comments on th is carrier-selection case. Full consideration will be given to all proposals that are timely filed. 5

The Department is providing interested air carri ers with some basic information to serve as guidance when they prepare their proposals, but there is no pres cribed format fo r proposals. Proposals are expected to adequately describe the service being prop osed and the annual amount of subsidy being requested. The applicants can make their own judgmen ts as to the level of detail they wish to present; however, it is recommended that information be included concerning proposed schedules a nd projected block hours. In a ddition, applicants are urged to provide financial data supporting their subs idy requests, including information on their

5 Air carriers should not expect the De partment to accept late filings. In cases where a carrier proposes to provide EAS without subsidy and we determine that service can be reliably provided without such compensation, we usually do not proceed with the carrier-selection case. Instead, we simply rely on that carrier’s subsidy- free service as proposed.- 8 -

projected expenses and revenues. Clear, well- documented proposals are strongly encouraged

in order to facilitate their evaluation by the af fected community an d the Department. 6

The Department expects proposals that are co nsistent with what the community currently receives, namely 18 nonstop round trips per week to Atlanta, Memphis, Nashville, or another suitable hub airport with small aircraft (9-seats) that provide numerous connecting opportunities to th e national air transportation system. If aircraft larger than 9 seats are proposed, at least 12 nonstop ro und trips per week ar e expected. We enco urage proposals that meet these guidelines in an ef ficient manner. Air carriers are also welcome to propose more than one service option, if they choose. They also need not limit th emselves to these requirements if they en vision other, poten tially more attractive service possibilities -- different hubs or length of contract, for exam ple -- with subsidy requ irements that remain competitive.

Interested air carriers should prepare their prop osal with every expectation that their initial proposal will also be their final and only proposal. The Department retains the discretion to negotiate proposals with air carri ers when the Department deems it necessary; in such cases, applicants will be given the same opportunity. The Department also retains the discretion to reject outright all unreasonable or unrealistic proposals and solicit a new round of proposals. However, any negotiation or rejec tion will likely c ontinue to be only occa sional exceptions to

the rule.

In order to assist air carriers in developing traffic and revenue projections for their proposals, historical passenger levels at Jackson are summarized in Appendi x B. In the most recent 12- month period for which data are availabl e (July 1, 2013, through June 1, 2014) Jackson generated 4,051 total origin and destination passengers, or an average of 6.5 enplanements per day. 7

Other Air Carrier Requirements The Department is responsible for implementing various Federal statutes governing lobbying activities, drug-free workpla ces and nondiscrimination. 8 Consequently, all air carriers receiving Federal subsidy to su pport EAS must certify that they are in compliance with Department regulations regarding drug-free work places and nondiscrimination, and those air carriers whose subsidies exceed $100, 000 over the life of the rate term must also certify that

6 In selecting a carrier to provide subsidized EAS for an eligible place not in Alaska, 49 U.S.C. § 41733(c)(1)

directs us to consider five factors: (a) service reliability; (b) contractual and marketing arrangements with a larger carrier at the hub; (c) interline arrangem ents with a larger carrier at the hub; (d) community views, giving substantial weight to the views of the elected officials representing the users; and (e) whether the carrier has included a plan in its proposal to market its service to the community. In addition, the Consolidated Appropriations Act, 2014, Public Law No. 113-76, provides that when selecting a carrier to provide EAS, the Department may consider the relative subsidy requirements, thus codifying a factor that we have considered since th e inception of the program. 7 Enplanements represent one-half of total origin-and-destination traffic. 8 The regulations applicable to these areas are: (1) 49 CF R Part 20 – New restrictions on lobbying; (2) 49 CFR Part 21 – Nondiscrimination in federally-assisted programs of th e Department of Transportation – Effectuation of title VI of the Civil Rights Act of 1964; 49 CFR Part 27 – Nondiscrimination on the basis of disability in programs and activities receiving or benefiting from Federal financial a ssistance; and 14 CFR Part 382 – Nondiscrimination on thebasis of disability in air travel; and (3) 49 CFR Part 29 – Government-wide debarment and suspension (nonprocurement) and government-wide requir ements for drug-fr ee workplace (grants).- 9 -

they are in compliance with the regulations governing lobbying ac tivities. All air carriers that plan to submit proposals involvi ng subsidy should submit the re quired certifications along with their proposals. Interested air carrier s requiring more detailed information regarding these requirements, as well as copies of th e certifications, should contact the Office of Aviation Analysis at (202) 366- 5903. The Department is proh ibited from paying subsidy to

air carriers that do not submit these documents. 9

Community Comments

Civic officials and the States are welcome to submit comments at any time. Prospective applicants are encouraged to contact the communit y before they submit th eir proposals so that they can tailor them to the community’s needs, as they will not be able to amend them after the due date. As noted earlier, a copy of the proposals will be provided to the civic parties

and ask them to submit their final comments shortly after November 24, 2014, the due date for air carrier proposals.

MACON Summary By this Order, the Department is requesting proposals from air carriers interested in providing EAS at Macon, GA, for a new term, with or without subsidy support, beginning November 6, 2014, or as soon as possible. Proposals are due November 12, 2014. (See Appendix A for a map.)

By Order 2013-2-2, issued on February 27, 2013, the Department selected Silver Airways (“Silver”) to provide EAS at Macon, at an annual subsidy rate of $1,998,696. 10 Silver provided six nonstop round trips per week to Atlanta, Geor gia, and six nonstop round trips per week to Orlando, Florida, using 34-passenger Saab 340B aircraft for the two- year period beginning March 15, 2013, through March 14, 2015.

However, on August 5, 2014, Silver filed notice of its intent to terminate service at Macon effective November 5, 2014. Silver’s proposed term ination of service at Macon would have left the community with no scheduled air service wh atsoever. As a result, the Department is requesting proposals from air carriers intere sted in providing EAS at Macon.

Silver’s termination notice as well as the comple te public file for EAS at Macon may be accessed online through the Federal Dock ets Management System at: http://www.regulations.gov by entering “DOT-OST-2007-28671” in the “SEARCH for: Rules, Comments, Adjudications or Supporting Documents:” field.

Request for Proposals Silver has been under contract with the Depart ment since February 27, 2013, and has filed notice

of its intent to terminate serv ice at Macon. Therefore, the De partment is requesting proposals

from air carriers interested in providing EAS at Macon, with or without subsidy support, for a

new contract term. Air carriers should file their proposals no later than November 24, 2014.

9 The certifications are also available on the we b at http://www.dot.gov/policy/aviation-policy/smallcommunity-rural-air-service/essential-air-service. 10 Such subsidy is calculated and distributed on a fiscal year basis, subject to the availability of funds.- 10 -

After that date, the proposals will be decide d, thereby making them public. Additionally, the Department requests each air carrie r serve a copy of its proposal on the civic parties at the above communities and on the other applicants. Shortly afterwards, a summary of the proposals will be provided to the communities asking them to submit any formal comments on this carrierselection case. Full consideration will be give n to all proposals that are timely filed.

The Department is providing interested air carri ers with some basic information to serve as guidance when they prepare their proposals, but there is no prescribed format for proposals. Proposals are expected to adequately describe the service being proposed and the annual amount of subsidy being requested. The applicants can make their own judgments as to the level of detail they wish to present; however, it is reco mmended that information be included concerning proposed schedules and projected block hours. In addition, applicants are urged to provide financial data supporting their subsidy reque sts, including information on their projected expenses and revenues. Clear, well-documented proposals are strongly encouraged in order to facilitate their evaluation by the aff ected community and the Department.

The Department expects proposals that are cons istent with what the community currently receives, namely 12 nonstop round tr ips per week to Atlanta or a nother suitable hub airport with

19- to 34-seat aircraft that provide numerous connecting oppor tunities to the national air transportation system. If smaller aircraft are proposed (9-seats), we will consider additional frequencies. We encourage proposals that meet these guidelines in an efficient manner. Air carriers are also welcome to propose more than on e service option, if they choose. They also need not limit themselves to these requirements if they envision other, potentially more attractive service possibilities -- different hubs or leng th of contract, for example -- with subsidy requirements that remain competitive.

Interested air carriers should prepare their propos al with every expecta tion that their initial proposal will also be their final and only propos al. The Department retains the discretion to negotiate proposals with air carr iers when the Department deems it necessary; in such cases, applicants will be given the same opportunity. The Department also retains the discretion to reject outright all unreasonable or unrealistic proposals and so licit a new round of proposals. However, any negotiation or rejection will likely continue to be only occasional exceptions to the

rule.

In order to assist air carriers in developing traffic and revenue projections for their proposals, historical passenger levels at Macon are summar ized in Appendix B. In the most recent 12- month period for which data are available (J uly 1, 2013, through June 1, 2014) Macon generated 3,044 total origin and destination passengers, or an average of 4.9 enplanements per day.

Other Air Carrier Requirements The Department is responsible for implementing various Federal statutes governing lobbying activities, drug-free workpla ces and nondiscrimination. 11 Consequently, all air carriers

11 The regulations applicable to these areas are: (1) 49 CFR Part 20 – New restrictions on lobbying; (2) 49 CFR Part 21 – Nondiscrimination in federally-assisted programs of the Department of Transportation – Effectuation of title VI of the Civil Rights Act of 1964; 49 CFR Part 27 – Nondiscrimination on the basis of disability in programs and activities receiving or benefiting from Federal financial assistance; and 14 CFR Part 382 – No ndiscrimination on- 11 -

receiving Federal subsidy to su pport EAS must certify that they are in compliance with Department regulations regarding drug-free work places and nondiscrimination, and those air carriers whose subsidies exceed $100, 000 over the life of the rate term must also certify that they are in compliance with the regulations governing lobbying ac tivities. All air carriers that plan to submit proposals involvi ng subsidy should submit the re quired certifications along with their proposals. Interested air carrier s requiring more detailed information regarding these requirements, as well as copies of th e certifications, should contact the Office of Aviation Analysis at (202) 366- 5903. The Department is proh ibited from paying subsidy to

air carriers that do not submit these documents. 12

Community Comments

Civic officials and the States are welcome to submit comments at any time. Prospective applicants are encouraged to contact the communit y before they submit th eir proposals so that they can tailor them to the community’s needs, as they will not be able to amend them after the due date. As noted earlier, a copy of the proposals will be provided to the civic parties

and ask them to submit their final comments shortly after November 24, 2014, the due date for air carrier proposals.

MERCED

Formal comments from Merced were due Se ptember 29, 2014. The City of Merced and the Merced Regional Airport Authority submitted comme nts, but without a formal recommendation. The community is awaiting additional information from carriers that proposed service and they plan to submit more information to us. Once that happens, the Department will address the carrier selection for Merced in a separate Order.

Carrier Fitness
49 U.S.C. §§ 41737(b) and 41738 require that we fi nd an air carrier fit, willing, and able to provide reliable service before we may subsidize it to provide EAS. Mu lti-Aero, Inc. d/b/a Air Choice One, SeaPort Airlines, Inc., and Sun Air International, LLC d/b/a Sun Air Express are subject to the Department’s con tinuing fitness requirements, and no information has come to our attention that would cause us to question the ai r carrier's fitness at this time. The Federal

Aviation Administration has been contacted, and it has raised no c oncerns that would negatively affect our fitness findings. The Department therefore concludes that the air carrier is reliable and

remains fit to conduct the operations proposed here.

ACCORDINGLY,

1. The Department selects SeaPort Airlines, In c. to serve Greenville, Mississippi, and Muscle Shoals, Alabama, and establish the annu al subsidy rates as described in Appendix C;

the basis of disability in air travel; and (3) 49 CFR Part 29 – Government-wide debarment and suspension (nonprocurement) and government-wide requir ements for drug-fr ee workplace (grants).

12 The certifications are also available on the we b at http://www.dot.gov/policy/aviation-policy/smallcommunity-rural-air-service/essential-air-service.- 12 -

2. The Department selects Sun Air Internati onal, LLC d/b/a Sun Air Express to serve Bradford and Franklin/Oil City, Pennsylvania, and establish the annual subs idy rates as described in Appendix C;

3. The Department selects Multi-Aero, Inc. d/b/a Air Choice One to serve Fort Dodge, Iowa, and establish the a nnual subsidy rates as de scribed in Appendix C;

4. The Department directs Multi-Aero, Inc. d/b/a Air Choice One to retain all books, records, and other source and summary documen tation 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 from the service date of this Order 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 carriers may forfeit thei r compensation for any cla im that is not supported under the terms of this Order;

5. The Department directs SeaPort Airlines, Inc. 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 perm its its audit and examination by representatives of the Department. Such documentation shall be retained for seven years from the service date of this Order or until the Depa rtment indicates that the reco rds may be destroyed, whichever comes first. Copies of flight l ogs for aircraft sold or disposed of must be retained. The carriers may forfeit their compensation for any claim that is not supported under the terms of this Order;

6. The Department directs Sun Air Express, LLC d/b/a Sun Air International to retain all books, records, and other source and summary docum entation 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 from the service date of this Order 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 carriers may forfeit thei r compensation for any cla im that is not supported

under the terms of this Order

7. The Department requests that carriers interest ed in providing Essential Air Service at Jackson, Tennessee, and/or Macon, Georgia, subm it their proposals, with subsidy support if necessary, no later than November 24, 2014. The proposals should be e-mailed to: scott.faulk@dot.gov with the title “Propos al to Provide EAS at Jackson and/or Macon”;

8. The Department finds that Multi-Aero, Inc. d/ b/a Air Choice One is fit, willing and able to operate as a commuter air carrier, and capable of providing reliable Essential Air Service at Fort Dodge, Iowa;

9. The Department finds that SeaPort Airlines, Inc. is fit, willing and able to operate as a certificated air carrier, and capable of providi ng reliable Essential Air Service at Greenville, Mississippi, and Muscle Shoals, Alabama;- 13 -

10. The Department finds that Sun Air Express, LLC d/b/a Sun Air International is fit, willing and able to operate as a commuter air car rier, and capable of providing reliable Essential

Air Service at Bradford and Fra nklin/Oil City, Pe nnsylvania; and

11. The Department will serve copies of this Orde r on the mayors, civic, and airport officials

at the communities identified in this Order.

Persons entitled to petition the Department for review of this Order under the Department’s Regulations, 14 CFR Part 385.31(a), must file such petitions within seven (7) days after the date

of service of this Order.

This Order will be effective immediately, and the filing of a petition for review shall not preclude its effectiveness.

By:

BRANDON M. BELFORD Deputy Assistant Secretary for

Aviation and International Affairs

(SEAL)

An electronic version of this document is available

at http://www.regulations.govAppendix A Page 1 of 2



## Jackson Area Map 1

1 Maps generated by the Great Circle Mapper - copyright © Karl L. Swartz

.Appendix A Page 2 of 2



## Macon Area Map 2

2 Maps generated by the Great Circle Mapper - copyright © Karl L. Swartz

.Appendix B Page 1 of 2



### Historical passenger Traffic at Jackson, Tennessee 1

Year Quarter Enplanements Deplanements Total

2011 3 69 55 124

2011 4 45 41 86

2012 1 240 165 405

2012 2 478 351 829
Total 832 612 1,444

2012 3 618 501 1,119

2012 4 695 501 1,196

2013 1 591 535 1,126

2013 2 656 601 1,257
Total 2,560 2,138 4,698

2013 3 652 597 1,249

2013 4 598 556 1,154

2014 1 531 477 1,008

2014 2 298 342 640
Total 2,079 1,972 4,051

1 Source: Bureau of Transp ortation Statistics; Schedule T-100.Appendix B Page 2 of 2



### Historical Passenger Traffic at Macon, Georgia 1

Year Quarter Enplanements Deplanements Total

2011 3 219 252 471

2011 4 184 247 431

2012 1 153 197 350

2012 2 184 191 375
Total 740 887 1,627

2012 3 107 126 233

2012 4 148 180 328

2013 1 143 214 357

2013 2 352 454 806
Total 750 974 1,724

2013 3 506 485 991

2013 4 413 404 817

2014 1 308 287 595

2014 2 337 304 641
Total 1,564 1,480 3,044

1 Source: Bureau of Transp ortation Statistics; Schedule T-100.Appendix C Page 1 of 5

Sun Air Express, LLC d/b/a Sun Air International Essential Air Service to be pr ovided at Bradford, Pennsylvania

Docket DOT-OST-2003-14528

Effective Period: November 1, 2014, through October 31, 2016 Scheduled Service: 24 weekly nonstop round trips to Pittsburgh (PIT) Aircraft: 8-passenger Piper Chieftain Rate per Eligible Flight: $838 2 Weekly Ceiling: $40,224 3

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 pr ior 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 f lights in full conformance with the Order for a significant perio d, it may jeopardize its entire subsidy claim for the period in ques tion. If the carrier contempl ates any such changes beyond the scope of the Order during the applicable period of this rate, 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 se lect a replacement carrier to provide serv ice 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 shoul d be adjusted or disallowed, the Department will consider the extent to which the goals of the program are met and th e extent of access to the natio nal 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 th e stipulated service levels, the carrier may cease to provid e service to that specific location without regards to any requirement for notice of such cessation. Those adjustments in the levels of subsidy and/or service that are mutually agreed to in writin g by the Department and carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract 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.

Funds may not be available for performance under this order beyond December 11, 2014. The Government’s obligation for performance under this order beyond Decem ber 11, 2014, is subject to the availa bility of funds from which payment for services can be made. No legal liability on the part of the Go vernment for any payment may arise for performance under this order beyond December 11, 2014, until funds are made available to the Department for performance. If sufficient funds are not made available for performance beyond December 11, 2014, the Department will provide notice in wr iting to the carrier.

All claims for payment, including any amended claims, must be submitted within 90 days of the last day of the
month for which compensation is being claimed. For example, claims for service provided in July must be filed by
October 31; August claims must be submitted by November 30, and so on.

2 Annual compensation of $2,045,826 divided by the 2,441 annual departures (8 flights per day x 313 days x 97.5 percent completion).

3 48 arrivals and departures per w eek multiplied by $838 per flight.Appendix C Page 2 of 5

Sun Air Express, LLC d/b/a Sun Air International Essential Air Service to be provided at Franklin/Oil City, Pennsylvania

Docket DOT-OST-1997-2523

Effective Period: November 1, 2014, through October 31, 2016 Scheduled Service: 19 weekly nonstop round trips to Pittsburgh (PIT) Aircraft: 8-passenger Piper Chieftain Rate per Eligible Flight: $788 1 Weekly Ceiling: $29,944 2

Note: The carrier understands that it may forfeit its compensa tion 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 sche dule or operate its flights in full confor mance with the Order for a significant perio d, it may jeopardize its entire subsidy claim for the period in qu estion. If the carrier contemplates any such changes beyond the scope of the Order during the applicable period of this rate, 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 se lect a replacement carrier to provide service on these routes. The carrier must complete all flights that can be safely operated; flights that ove rfly points for lack of traffic will not be compensated. In determining whether subsidy payment for a deviating flight shou ld be adjusted or disallowed, the Department will consider the extent to which the goals of the pr ogram 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 locati on provided for under this Order, then, at the end of the period for which the Department does make payments in the stipulated service levels, the carrier may cease to provide service to that specific location without regards 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 carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract 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, regul ations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds may not be available for performance under this order beyond December 11, 2014. The Government’s obligation for performance under this order beyond December 11, 2014, is su bject to the availability of 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 December 11, 2014, until funds are made available to the Department for performance. If sufficient funds are not made available for performance beyond December 11, 2014, the Department will provide notice in wr iting to the carrier.

All claims for payment, including any amended claims, must be submitted within 90 days of the last day of the month for which compensation is being claimed. For example, claims for service provided in July must be filed by October 31; August claims must be submitted by November 30, and so on.

1 Annual compensation of $1,442,788 divided by the 1,831 annual departures (6 flights per day x 313 days x 97.5 percent completion).

2 38 arrivals and departures per w eek multiplied by $788 per flight.Appendix C Page 3 of 5

Multi-Aero Inc. d/b/a Air Choice One Essential Air Service to be provided at Fort Dodge, Iowa

Docket DOT-OST-2001-10682

Effective Period: November 1, 2014, through October 31, 2016 Scheduled Service: 24 weekly nonstop round trips to STL Aircraft: 9-passenger Cessna Grand Ca ravan or 8-passenger Piper Navajo Rate per Eligible Flight: $1,530 3 Weekly Ceiling: $73,440 4

Note: The carrier understands that it may forfeit its compensa tion 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 sche dule or operate its flights in full confor mance with the Order for a significant perio d, it may jeopardize its entire subsidy claim for the period in qu estion. If the carrier contemplates any such changes beyond the scope of the Order during the applicable period of this rate, 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 se lect a replacement carrier to provide service on these routes. The carrier must complete all flights that can be safely operated; flights that ove rfly points for lack of traffic will not be compensated. In determining whether subsidy payment for a deviating flight shou ld be adjusted or disallowed, the Department will consider the extent to which the goals of the pr ogram 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 locati on provided for under this Order, then, at the end of the period for which the Department does make payments in the stipulated service levels, the carrier may cease to provide service to that specific location without regards 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 carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract 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, regul ations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds may not be available for performance under this order beyond December 11, 2014. The Government’s obligation for performance under this order beyond December 11, 2014, is su bject to the availability of 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 December 11, 2014, until funds are made available to the Department for performance. If sufficient funds are not made available for performance beyond December 11, 2014, the Department will provide notice in wr iting to the carrier.

All claims for payment, including any amended claims, must be submitted within 90 days of the last day of the month for which compensation is being claimed. For example, claims for service provided in July must be filed by October 31; August claims must be submitted by November 30, and so on.

3 Annual compensation of $3,715,953 divided by the 2,429 annual departures (8 flights per day x 313 days x 97%

4 48 arrivals and departures per w eek multiplied by $1,530 per flight.Appendix C Page 4 of 5

SeaPort Airlines, Inc.

Essential Air Service to be Provi ded at Greenville, Mississippi

DOT-OST-2008-0209

Annual Subsidy: $1,483,080 Effective Period: November 1, 2014, through October 31, 2016 Hub: Memphis International Airport (MEM) Scheduled Service: 18 weekly nonstop round trips Aircraft: 9-passenger Cessna Caravan Rate per Eligible Flight: 1 $800
Weekly Ceiling: 2 $28,800

Note: The carrier understands that it may forfeit its compensa tion 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 sche dule or operate its flights in full confor mance with the Order for a significant perio d, it may jeopardize its entire subsidy claim for the period in qu estion. If the carrier contemplates any such changes beyond the scope of the Order during the applicable period of this rate, 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 se lect a replacement carrier to provide service on these routes. The carrier must complete all flights that can be safely operated; flights that ove rfly points for lack of traffic will not be compensated. In determining whether subsidy payment for a deviating flight shou ld be adjusted or disallowed, the Department will consider the extent to which the goals of the pr ogram 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 locati on provided for under this Order, then, at the end of the period for which the Department does make payments in the stipulated service levels, the carrier may cease to provide service to that specific location without regards 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 carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract 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, regul ations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds may not be available for performance under this Order beyond December 11, 2014. The Government’s obligation for performance under this Order beyond December 11, 2014, is s ubject to the availability of funds from which payment for services can be made. No legal liability on the part of the Go vernment for any payment may arise for performance under this order beyond December 11, 2014, until funds are made available to the Department for performance. If sufficient funds are not made available for performance beyond December 11, 2014, the Department will provide notice in wr iting to the carrier.

All claims for payment, including any amended claims, must be submitted within 90 days of the last day of the month for which compensation is being claimed. For example, claims for service provided in July must be filed by October 31; August claims must be submitted by November 30, and so on.

1 Annual compensation of $1,483,080 divided by 1,853 annual de partures (36 weekly departures x 52 weeks x 99 percent completion).

2 36 arrival and departures per week multiplied by $800 per flightAppendix C Page 5 of 5

SeaPort Airlines, Inc.

Essential Air Service to be Provi ded at Muscle Shoals, Alabama

DOT-OST-2000-7856

Annual Subsidy: $1,739,308 Effective Period: November 1, 2014, through October 31, 2016

Hub: Nashville In ternational Airport (BNA) Scheduled Service: 24 weekly nonstop round trips Aircraft: 9-passenger Cessna Caravan Rate per Eligible Flight: 1 $736
Weekly Ceiling: 2 $35,328

Note: The carrier understands that it may forfeit its compensa tion 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 sche dule or operate its flights in full confor mance with the Order for a significant perio d, it may jeopardize its entire subsidy claim for the period in qu estion. If the carrier contemplates any such changes beyond the scope of the Order during the applicable period of this rate, 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 se lect a replacement carrier to provide service on these routes. The carrier must complete all flights that can be safely operated; flights that ove rfly points for lack of traffic will not be compensated. In determining whether subsidy payment for a deviating flight shou ld be adjusted or disallowed, the Department will consider the extent to which the goals of the pr ogram 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 locati on provided for under this Order, then, at the end of the period for which the Department does make payments in the stipulated service levels, the carrier may cease to provide service to that specific location without regards 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 carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract 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, regul ations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds may not be available for performance under this Order beyond December 11, 2014. The Government’s obligation for performance under this Order beyond December 11, 2014, is s ubject to the availability of funds from which payment for services can be made. No legal liability on the part of the Go vernment for any payment may arise for performance under this order beyond December 11, 2014, until funds are made available to the Department for performance. If sufficient funds are not made available for performance beyond December 11, 2014, the Department will provide notice in wr iting to the carrier.

All claims for payment, including any amended claims, must be submitted within 90 days of the last day of the month for which compensation is being claimed. For example, claims for service provided in July must be filed by October 31; August claims must be submitted by November 30, and so on.

1 Annual compensation of $1,818,106 divided by 2,471 annual de partures (48 weekly departures x 52 weeks x 99 percent completion).

2 48 arrival and departures per week multiplied by $736 per flight