# Venango County Venango Regional Airport Chess Lamberton Field
www

### .flyfranklin.org 1560 Airport Road Franldin, PA 16323 814/432-5333

July 18, 2014
The Honorable Anthony Foxx Secretary ofTransportation U.S. Department ofTransportation 1200 New Jersey Avenue, SE Washington, DC 20590 

## Commissioners: Timothy S. Bmoks Vincent L. 

### Witherup Bonnie S. Summers Airport Manager: Otho C. Bell

·.· J

j··

....,::·· Re: Petition ofFranklin/Oil City, PA for a waiver from the 10-enplanementstatute, Docket-OST-DOT-1997-25123
Dear Mr. Foxx:
The Venango County Regional Airport (FKL) was served on june 24, 2014, with the U.S. Department ofTransportation (DOT) Order 2014-6-6 thatwe are being eliminated from the Essential Air Service (EAS) program due to our passenger enplanementnumbers being less than 10 per service day. EAS service at FKL is incredibly importantto the local economy ofFranklin, Oil City, and Venango County.
FKL formally requests an Exemption from 49 U.S.C. §41731 (a)(1)(B) in order to continue air service at FKL. The reason for this request is that FKL has been relegated to poor, unreliable service for some time, but especially since Gulfstream International Airlines (now Silver Airways) took over operations in 2008. Gulfstream/Silver created a culture ofpoor operations and indifference toward their EAS communities. FKL specificallywas impacted greatly by a culture at the airline, likely from the highest staffing levels, ofoverflying FKL whenever weather orconditions appeared to be marginal, in order for them to collect their EAS subsidies due to "weather cancellations". In fact, it was not uncommon for GulfstreamfSilver dispatchers to file flight plans thatoverflew FKL well in advance ofscheduled arrival time, without any attempt to complete the flight. Indifference from the Gulfstream/Silver management forced FKL to spend thousands ofdollars over the years paying for transportation for passengers stranded by GulfstreamfSilver to getto another airportto starttheir travels. Communication with Gulfstream/Silver was poor atbest, and was nonexistent most ofthe time.
As partofthe order to eliminate FKL from the EAS program, a waiver process was established that enables the U.S. DOT Secretary to granta waiver for an airport thathas had a "temporary" reduction in passenger enplanements below 10 per service day. FKL, until2005, maintained approximately 10 enplanements per service day, and had as many as 16.2. The turmoil thatAir Midwest and US Airways went through in 2005 to 2008 caused passenger numbers to drop; however, the four-month hiatus in 2008 had severelongterm impacts (Table 1).We feel that those impacts could have been mitigated with an airline thatwas committed to providing a reliable product. Gulfstream/Silver consistently had major operational problems, especially dealing with the airportand weather conditions at FKL. Table 1 FKL Passenger Enplanements by CalendarYearU.S. DepartmentofTransportation July 18, 2014 Page2 Immediately upon Gulfstream commencing operations in the fall of2008; it became readily apparent that the airline was ill-equipped orprepared for operations outside ofits Florida base ofoperations. The airline had no experience operatingin northern climates, especially in an area ofwestern Pennsylvania and northeastern Ohio, that can prove challenging due to icing conditions. Only two oftheir fleet ofBeechcraft B1900D aircrafthad anti-ski brakes, which caused many ofthe cancellations and "overflights" ofFKL. The issue stems from FKL's 5,200 foot runway and anytime the runway had contamination (water or snow for example). The braking action requirements and operational parameters ofB1900Ds, withoutthe anti-skid brakes, was inadequate for consistent winteruse our runway.
Numerous conversations with Gulfstream/Silver management, including an operational meeting at their Cleveland hub in 2009, failed to resolve the issue during their time here in FKL. 

### This caused GulfstreamjSilver to cancel an average of 22.8percentof flights during theDecember to February timeperiodsince2008. While passengers had a nearly
one in four chance oftheir flights being cancelled during the winter months, it was ofno surprise that passengers continued to fall as passengers began booking away from FKL even duringthe summer months, and the efforts from the local community to reverse those trends were for naught.
Due to the major issues being experienced, FKL became an active memberin the Pennsylvania Air Service Committee (PASC), which was founded to help promote the commercial service airports within the state ofPennsylvania. As passengers at all five EAS markets that Gulfstream operated at in 2009 began to decline precipitously, the PASC, Pennsylvania DepartmentofTransportation (PennDOT) and Pittsburgh International Airport (PIT) began working together to determine a solution. In 2010, a decision was made to pursue a statewide studyto determine passenger demand, and the study formally began in 2011. This multi-year study was undertaken to quantify passengers in each catchment area and forecast potential enplanements ifPIT became ourconnecting hub. More than 30 community meetings were held throughout the state including in each EAS community to discuss air service needs and gauge support for this service. 

### This study found that reliable service on nine-seat aircraft to PJT, combined with a lowlocalfare structure can be justas successfulatPITas it

### has been atLambert-St. Louis InternationalAirport(STL) for CapeAirandAir Choice One. See Appendix Afor a discussion ofthe PIT Connector study.
With the definition of"temporary" being "lasting for only a limited period oftime; notpermanent"; it is in the opinion of FKL that our decline, while being for eight years, is in fact temporary, and with the proper service will easily restore passengers above 10 enplanements per day. Untying FKL from other airports and eliminating the "overflight" issue would be a dramatic improvement to operations, while the low-fare, higher frequency model will bringpassengers back from the road and their drive to PIT today.
We are now close to implementing this multi-year study and plan and we are requesting that the U.S. DOT allow FKL to begin service to PIT and granta waiver in order to allow us to prove that our concept is capable ofincreasing enplanements to and above the statutory minimums. Surely there are no other EAS communities in the country that have been a part ofsuch a detailed study and have a fully executable plan on which to right the ship and excel with their EAS. Supporting this project, PennDOT and PIT have pledged significant funds for marketing and sales efforts in order to ensure air service remains at FKL while we implementthe long awaited restoration ofservice to PIT.
FKL respectfully requests a waiver to continue our air service for oneyear and quickly move to award our EAS contract to Sun Air so thatwe can begin to rebuild passengers to demonstrate to the U.S. DOT thatour passenger reduction truly was "temporary" We look forward to working with you, the airlines, PIT, and the community to repair the damages to the air travel market atFKL. This plan is a practical solution to increase passengers to exceed the EAS minimums while ensuring access to the National Transportation System.U.S. DepartmentofTransportation July 18, 2014 Page 3

Thankyou. Respectfully submitted,

Otho C. Bell

Cc: Senator Bob Casey Congressmen Glenn Thompson Governor Tom Corbett Mr. Barry Schoch, P.E. Commissioners, County ofVenango

## AppendixA: Discussion ofPIT Connector and Midwest EAS Comparisons
Pennsylvania Regional Air Service Plan
Startingin 2012, Mead & Huntwas contracted to perform a statewide study to establish a baseline level ofdemand from the 13 commercial service airports in the state ofPennsylvania (excluded both Philadelphia International Airport (PHL) and PIT) and to determine the viability ofconnecting those airports to PIT. This was the first comprehensive air service development study completed in many ofthe EAS markets, and enabled the communities to have a better feel for what their air service demand actually is. As partofthe study, representatives from Mead & Huntperformed more than 30 communitymeetings around the state, allowing for direct discussions in each community ofcurrent air service, as well
as discussion ofthe current airline industry trends.

The study found thatthere was significant diversion (i.e. leakage) to the larger airports in the region. Leakage is not a phenomenon only associated with the smallest EAS markets and is experienced by most airports around the country. The study found thatall13 ofthe commercial service airports in Pennsylvania leaked ata minimum of40 percentoftheir passengers, while the EAS markets leaked as much as 99 percent oftheirpassengers to surrounding airports (TableA.1).

The study found that PHL and PIT were the main diverting airports, broken down geographically. For those markets in the eastern halfofPennsylvania, their main leakage was to PHL, while those in the western halfofPennsylvania predominately drove to PIT for their air service. This was true ofthe EAS Table A.1 Domestic and International Retention

markets in the western halfofPennsylvania as well. Seventy-four percent ofFKL area passengers drive to PIT today in order to utilize the lower fares and nonstop destinations. Connecting FI<L to PlT with low-fare service that people can rely upon will generate enough passengers to be above 10 enplanements per day and under $200 per passenger in subsidy.

Through the leakage study and a comprehensive survey in each community, Mead &Huntwas able to determine that the majority ofpassengers diverted due to reliability, fares and schedules. Although PIT is not a hub as itwas in the 1990s and 2000s, itstill offers more than 160 daily departures to 36 destinations. The study completed multiple forecasting models for service to PIT, involving aircraft from 50-seat regional jets all the way to nine-seat turboprops. The study ultimately found that the scenario that would work the bestin today's environmentwould be a 

### low-fare, highfrequency service on nine-seataircraft.

The primary causes for leakage are the limited number offrequencies and high fares in comparison to the larger nearby airports. The study also found that the combination ofmarkets in "tags" or "one-stops" created a major dissatisfaction

## AppendixA: Discussion ofPIT Connector and Midwest EAS Comparisons
with customers, as well as greatlydecreased the reliability ofthe service, especially during the winter months when weather in one community frequently impacted the air service to the other community tied with it Whatthe study also found is thatthe EAS communities currently around Lambert-St. Louis International Airport (STL) are very similar in size and proximityto EAS communities in western Pennsylvania. They had poor service that was unreliable, high priced and seldom used. Their service was switched to a similarlow-fare, high frequency service on a nine-se<'lt aircraft, and passenger numbers improved five to 10 times their most recent levels. 

### It is importantto note thatcommunities that hadhistoricallyboardedless thanfive enplanementsperday are nowatmore than 15enplanementsperday. 

### MidwestEAS Community Comparisons Although every community is different and it's difficult to find perfect "proxy" markets for comparison purposes, the closestexample for FKL and Bradford is the Midwest EAS communities thatsurround STL. TableA.3 shows the population comparisons and distance to either STL or PIT. When comparing to similarmarkets around STL, Franklin is similarin size and distance as Quincy, IL. While FKL is approximately40 minutes closer to the airport it's important to note that FKL's route involves the mountains ofWestern Pennsylvania which can be hazardous in the winter. The much larger population (61 percenthigher population than Quincy) surrounding Franklin, would more than make up for its closerproximity to the hub. 

### FKL today, however, boards almost 90percent fewerpassengers tilan Quincy.

When comparing passengers from 2009 to 2013, the communities in the STL area have experienced growth from 157 percent to nearly 1,200 percent. Although FKL bas shown some growthin passengers since 2009, which is a testament to the local community's commitment to promoting the air service, even as the currentcarrier failed to uphold its obligation ofreliable service.

Due to the success in the partnership between Cape Air orAir Choice One, STL and the local communities, these Midwest EAS markets have seen an explosion in growth in passengers overthe past five years with a model very similar to the one that is being contemplated for FKL. The commitmentofPIT and PennDOT, however, goes beyond what has been done in those markets, and will help to further guarantee the success ofthe new service. 

### There is very little doubt, thatFKL, aswell as Bradford, wouldseedramaticgrowth in passengers with asimilar/ow-fare, highfrequency operation to PIT, easily maintainingmore than 10enplanementsperday.