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AIR SERVICE TO SMALL AND RURAL 

COMMUNITIES 

(113–69) 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

AVIATION 

OF THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED THIRTEENTH CONGRESS 

SECOND SESSION 

APRIL 30, 2014 

Printed for the use of the 

Committee on Transportation and Infrastructure 

( 

Available online at: http://www.gpo.gov/fdsys/browse/ 

committee.action?chamber=house&committee=transportation 

(II) 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE 

BILL SHUSTER, Pennsylvania, Chairman 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee, 

Vice Chair 

JOHN L. MICA, Florida 

FRANK A. LOBIONDO, New Jersey 

GARY G. MILLER, California 

SAM GRAVES, Missouri 

SHELLEY MOORE CAPITO, West Virginia 

CANDICE S. MILLER, Michigan 

DUNCAN HUNTER, California 

ERIC A. ‘‘RICK’’ CRAWFORD, Arkansas 

LOU BARLETTA, Pennsylvania 

BLAKE FARENTHOLD, Texas 

LARRY BUCSHON, Indiana 

BOB GIBBS, Ohio 

PATRICK MEEHAN, Pennsylvania 

RICHARD L. HANNA, New York 

DANIEL WEBSTER, Florida 

STEVE SOUTHERLAND, II, Florida 

JEFF DENHAM, California 

REID J. RIBBLE, Wisconsin 

THOMAS MASSIE, Kentucky 

STEVE DAINES, Montana 

TOM RICE, South Carolina 

MARKWAYNE MULLIN, Oklahoma 

ROGER WILLIAMS, Texas 

MARK MEADOWS, North Carolina 

SCOTT PERRY, Pennsylvania 

RODNEY DAVIS, Illinois 

MARK SANFORD, South Carolina 

DAVID W. JOLLY, Florida 

NICK J. RAHALL, II, West Virginia 

PETER A. DEFAZIO, Oregon 

ELEANOR HOLMES NORTON, District of 

Columbia 

JERROLD NADLER, New York 

CORRINE BROWN, Florida 

EDDIE BERNICE JOHNSON, Texas 

ELIJAH E. CUMMINGS, Maryland 

RICK LARSEN, Washington 

MICHAEL E. CAPUANO, Massachusetts 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

GRACE F. NAPOLITANO, California 

DANIEL LIPINSKI, Illinois 

TIMOTHY J. WALZ, Minnesota 

STEVE COHEN, Tennessee 

ALBIO SIRES, New Jersey 

DONNA F. EDWARDS, Maryland 

JOHN GARAMENDI, California 

ANDRE ́ CARSON, Indiana 

JANICE HAHN, California 

RICHARD M. NOLAN, Minnesota 

ANN KIRKPATRICK, Arizona 

DINA TITUS, Nevada 

SEAN PATRICK MALONEY, New York 

ELIZABETH H. ESTY, Connecticut 

LOIS FRANKEL, Florida 

CHERI BUSTOS, Illinois 

SUBCOMMITTEE ON AVIATION

FRANK A. LOBIONDO, New Jersey, Chairman 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee 

SAM GRAVES, Missouri 

BLAKE FARENTHOLD, Texas 

LARRY BUCSHON, Indiana 

PATRICK MEEHAN, Pennsylvania 

RICHARD L. HANNA, New York 

DANIEL WEBSTER, Florida 

JEFF DENHAM, California 

REID J. RIBBLE, Wisconsin 

THOMAS MASSIE, Kentucky 

STEVE DAINES, Montana 

ROGER WILLIAMS, Texas 

MARK MEADOWS, North Carolina 

RODNEY DAVIS, Illinois, Vice Chair 

BILL SHUSTER, Pennsylvania (Ex Officio) 

RICK LARSEN, Washington 

PETER A. DEFAZIO, Oregon 

EDDIE BERNICE JOHNSON, Texas 

MICHAEL E. CAPUANO, Massachusetts 

DANIEL LIPINSKI, Illinois 

STEVE COHEN, Tennessee 

ANDRE ́ CARSON, Indiana 

RICHARD M. NOLAN, Minnesota 

DINA TITUS, Nevada 

SEAN PATRICK MALONEY, New York 

CHERI BUSTOS, Illinois 

CORRINE BROWN, Florida 

ELIZABETH H. ESTY, Connecticut 

NICK J. RAHALL, II, West Virginia 

(Ex Officio) 

(III) 

CONTENTS Page 

Summary of Subject Matter .................................................................................... iv 

TESTIMONY 

Hon. Susan L. Kurland, Assistant Secretary for Aviation and International 

Affairs, U.S. Department of Transportation ...................................................... 5 

Gerald L. Dillingham, Ph.D., Director, Physical Infrastructure Issues, U.S. 

Government Accountability Office ...................................................................... 5 

Captain Lee Moak, president, Air Line Pilots Association, International .......... 5 

Bryan K. Bedford, chairman, president and chief executive officer, Republic 

Airways ................................................................................................................. 5 

Dan E. Mann, AAE, executive director, Columbia Metropolitan Airport ........... 5 

Brian L. Sprenger, airport director, Bozeman Yellowstone International Airport ........................................................................................................................ 5 

PREPARED STATEMENT SUBMITTED BY MEMBER OF CONGRESS 

Hon. Elizabeth H. Esty, of Connecticut ................................................................. 39 

PREPARED STATEMENTS SUBMITTED BY WITNESSES 

Hon. Susan L. Kurland ........................................................................................... 40 

Gerald L. Dillingham, Ph.D. ................................................................................... 49 

Captain Lee Moak ................................................................................................... 76 

Bryan K. Bedford ..................................................................................................... 86 

Dan E. Mann, AAE .................................................................................................. 102 

Brian L. Sprenger .................................................................................................... 107 

SUBMISSIONS FOR THE RECORD 

Hon. Richard M. Nolan, a Representative in Congress from the State of 

Minnesota, request to submit the following items into the record: 

Robert W. Anderson, mayor, city of International Falls, Minnesota, letter 

to Hon. Frank A. LoBiondo, a Representative in Congress from the 

State of New Jersey, April 30, 2014 ............................................................ 21 

James L. Oberstar, Member of Congress from 1975–2011, letter to Hon. 

Anthony Foxx, Secretary, U.S. Department of Transportation, April 

28, 2014 .......................................................................................................... 23 

ADDITIONS TO THE RECORD 

Captain Keith Wilson, president, Allied Pilots Association, and Captain Bob 

Coffman, chairman, Government Affairs Committee, Allied Pilots Association; joint written statement ............................................................................... 113 

Coalition of Airline Pilots Associations, written statement ................................. 114 

Craig A. Moffatt, executive board president, Teamsters Local Union No. 357, 

written statement ................................................................................................. 120 

Families of Continental flight 3407, written statement ....................................... 124 

Hon. Blake Farenthold, a Representative in Congress from the State of Texas, 

request to submit a letter from D. Dale Fowler, CEcD, president, Victoria 

Economic Development Corporation, April 29, 2014 ......................................... 129 

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(1) 

AIR SERVICE TO SMALL AND RURAL 

COMMUNITIES 

WEDNESDAY, APRIL 30, 2014 

HOUSE OF REPRESENTATIVES, SUBCOMMITTEE ON AVIATION, COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, Washington, DC. 

The subcommittee met, pursuant to notice, at 10:02 a.m. in Room 

2167, Rayburn House Office Building, Hon. Frank A. LoBiondo 

(Chairman of the subcommittee) presiding. 

Mr. LOBIONDO. Good morning. The subcommittee will come to 

order. 

Before we get started, Mr. Larsen and I would like to recognize 

the Colgan Air families for being here. We want to thank you for 

your advocacy, we want to thank you for being involved and making a difference. And we are very pleased that you are here today. 

I ask unanimous consent that Members not on the subcommittee 

be permitted to sit with the subcommittee at today’s hearing to 

offer testimony and to ask questions. 

[No response.] 

Mr. LOBIONDO. Without objection, so ordered. 

Today we look forward to hearing from the Department of Transportation, the Government Accountability Office, and industry 

stakeholders on an important topic to our country: air service to 

small and rural communities. Airports are vital elements of our 

Nation’s infrastructure. They enable millions of passengers to travel through the United States and to the rest of the world. Airports 

are economic drivers for many communities across the United 

States, contributing millions of jobs to our economy, and generating 

trillions of dollars in economic input. They serve as staging points 

for lifesaving emergency services, as well as a lifeline to many 

rural or remote communities. The impact of airports is felt way beyond the tarmac and the terminal. 

In recent years, smaller airports in the U.S. have, for a variety 

of reasons, experienced a decrease in air service. The subcommittee 

is interested in hearing from the witnesses about the Federal programs that exist to assist in delivering air service to small and 

rural communities, and how they are being utilized. We are also 

very interested in hearing about innovative approaches that industry stakeholders from airports to air carriers to local communities 

have taken to retain or to be able to increase that service. 

I am well aware of how important airports are to local communities. In my own district we have seen an increase in routes, 

bringing new air service to Atlantic City International Airport. 

2 

And, starting on April 1st, United began two new direct routes to 

Houston and Chicago from Atlantic City. We believe this level of 

service is the type of increase that will help local businesses and 

the economy. 

As we hear more about the types of successes later, I can tell you 

that it is not something that just happens overnight. It takes a lot 

of hard work, a lot of coordination on the local level, a true community effort. And the end result is what makes all that hard work 

worth it. 

I look forward to hearing from our witnesses, and thank them for 

joining us today. 

Before I recognize my colleague, Mr. Larsen, for his comments, 

I would like to ask unanimous consent that all Members have 5 

legislative days to revise and extend their remarks, and include extraneous material for the record of this hearing. 

[No response.] 

Mr. LOBIONDO. Without objection, so ordered. And now I would 

like to yield to Mr. Larsen. 

Mr. LARSEN. Thank you, Mr. Chairman. I too want to recognize 

the Colgan Air families, and thank you for your continued advocacy 

to help improve air safety here in the United States. 

Mr. Chairman, residents of remote, small communities across the 

country connect to national and international aviation systems 

through our smaller airports and the regional carriers that serve 

them. Air service not only connects these communities to the economy, but serves as a lifeline for emergency services, disaster relief, 

and delivery of time-sensitive cargo. And as we begin to consider 

the next FAA reauthorization, today’s hearing helps us assess some 

of these issues and challenges facing small community air service. 

In 1978, Congress enacted the Airline Deregulation Act, which 

phased out the Federal Government’s control over domestic air 

fares and routes. Since the deregulation, airlines have largely been 

free to decide where to fly. And, as a consequence, small communities have struggled to attract and retain air service. And almost 

four decades later, air service in the U.S. is, not surprisingly, highly concentrated at the largest airports, where routes are more profitable. Eighty-eight percent of passengers board at sixty-two large 

or medium-hub airports. 

Further, in recent years we have seen a significant airline industry restructuring, in part as a response to recessions and increasing 

fuel prices. Since 2005, there have been three mergers involving six 

major U.S. legacy carriers, and greater capacity discipline throughout the industry. There is no doubt that these recent developments 

have had a major effect on small community service. 

From 2007 to 2012, roughly 1.4 million yearly scheduled domestic flights have been cut. And during that same time period, the 29 

largest airports lost 8.8 percent of the scheduled domestic flights, 

while the impact is disproportionate as small-, medium-, and nonhub airports have lost 21.3 percent of the scheduled domestic 

flights. 

So, today this committee will hear from two airport directors 

about proactive and innovative steps they have taken in their small 

communities to attract and retain air service. But despite these examples of strong local leadership, maintaining a truly national air 

3 

transportation system does require a sustained Federal commitment. 

When Congress deregulated the airlines in 1978, it also recognized that the market alone could not reliably maintain air service 

to small communities. Therefore, Congress created the Essential 

Air Service program, the EAS program, which guaranteed that 

communities served by carriers before deregulation would continue 

to receive air service. 

So we can’t have it both ways. We can’t support small community 

air service, while advocating for the elimination of the EAS program. A House-passed authorization bill in 2011 would have eliminated the EAS program everywhere except Alaska and Hawaii. 

And earlier this month, the House-passed budget doubled down on 

that policy by ending service to small communities by proposing to 

phase out the EAS program. 

Now, Mr. Chairman, you and I have both stated several times in 

the past few months that we have every intention to craft a bipartisan FAA reauthorization bill. So I hope, in the next reauthorization, efforts to dismantle EAS are a nonstarter from the get-go. 

And I look forward to working with my colleagues on both sides of 

the aisle to preserve and strengthen this important program that 

guarantees service to more than 160 small communities across the 

country. 

And finally, Mr. Chairman, in 2010 Congress mandated new 

pilot training, qualification, and work-hour rules that have only recently come into effect. Some regional carriers that serve small 

communities claim they are having difficulty hiring pilots because 

of these new safety regulations. Just last month, the GAO examined this issue and reported that, in fact, a large pool of qualified 

pilots exists, relative to projected demand. But whether such pilots 

are willing or available to work at the wage that is being offered 

is unknown. 

According to GAO, the average base entry-level salary at regional airlines—at the airlines examined equates approximately $21,600 

a year. And, according to the Wall Street Journal, Great Lakes Airlines, the carrier with the largest presence in the EAS program, offers entry-level starting salaries of $16,500 a year. And, not surprisingly, Great Lakes claims it is having a hard time hiring new 

pilots, and has cut service to a handful of EAS communities. And, 

to date, the Department of Transportation has been successful in 

finding replacements for most of these communities. 

But we ought to be clear, Mr. Chairman, that Congress enacted 

the 2010 safety law to improve safety. However, the investigations 

in the 2009 Colgan Air flight 3407 tragedy revealed a two-tiered 

airline industry labor structure, that was broken. And, for over a 

decade, industry consolidation and cost cutting at regional airlines 

led to lower and lower airline pilot pay, and a race to the bottom 

that is destroying the American airline pilot profession. That situation is not sustainable. 

Moreover, I also believe the Department must examine its relationship to EAS carriers that are paying pilots minimum and poverty-level wages. The race to the bottom should not be driven by 

carriers whose broken business models are sustained largely by 

Federal contracts. 

4 

Moreover, it is not realistic for the Department to assume that 

these carriers can provide reliable service when they cannot attract 

new pilots by offering a livable wage. 

So, these are very tough issues we are facing, Mr. Chairman, but 

I look forward to exploring them with you, and thank you, and look 

forward to hearing from our witnesses. 

Mr. LOBIONDO. Thank you, Mr. Larsen. And before we go to our 

panel, I would like to recognize Chairman Shuster. Before I do 

that, though, I would like to thank Mr. Shuster and Mr. Rahall for 

the particular attention they are paying to aviation industry issues, 

to the stakeholder problems, to participating in what we are doing 

on an aviation standpoint, and recognizing the critical importance 

from a safety standpoint and an economic standpoint. 

And, Mr. Chairman, thank you, and you are recognized. 

Mr. SHUSTER. Thank you, Mr. Chairman. First I want to thank 

the chairman for those kind words. And I appreciate that he and 

Mr. Larsen are working so hard and diligent on the issues that face 

aviation in America, which I think are serious. And we really need 

to pay attention to it. And, as I have said in a number of statements and speeches, we really need to look at how we operate, 

whether it is in manufacturing, and the pressure they are under 

from foreign competition, or our airlines, the competition that they 

are facing out there, to the burdens we put on both segments or 

all segments of the aviation industry from the Government. So, 

again, we have started a discussion, and I appreciate Mr. Larsen 

and Mr. LoBiondo’s participation. 

I too want to thank the Colgan Air families for their efforts. 

Thanks for being here today, and we look forward to continuing to 

work with you. 

In my home State of Pennsylvania, aviation plays a critical role 

in our economy, supporting over 300,000 jobs. With continued investment in our national aviation system, small and rural communities will be able to stay connected to our Nation’s larger cities 

and markets. Airports in my district—we have got Altoona-Blair 

County Airport and the neighboring district, the Johnstown Airport—act as economic engines in attracting and supporting businesses. The airport provides a critical link to the rest of the country that is necessary for local businesses to thrive and reach markets that otherwise may not be possible. 

Sheetz Corporation, for those of you that have ever traveled to 

Pennsylvania or outside Washington, a very successful convenience 

store operator in my district, headquartered in my district. It relies 

on the transportation network around the Altoona-Blair County 

Airport to remain successful. Without that vital link the airport 

provides in connecting to the rest of the country, many businesses 

like Sheetz would be forced to operate elsewhere. 

But in small and rural areas across the country, like the district 

that I represent, we have seen a reduction in overall air service, 

market consolidation, Government mandates on pilot training, and 

other economic factors all play a significant role in the trends that 

we have seen. I am committed to finding solutions that will help 

retain and protect critical air services to keep small and rural airports up and running, protect jobs, and provide the critical assets 

to those local economies. 

5 

I look forward to hearing from our panel today, thank all of our 

panel members for being here and taking the time, especially the 

two airport directors, the steps they have taken to keep their airports central to the local economy. You are the guys on the ground 

who are always looking for ways to improve the airports and generate local business, and we appreciate that. 

And, with that, Mr. Chairman, I yield back. 

Mr. LOBIONDO. Thank you, Mr. Shuster. And now we are going 

to turn to our panel. Our witnesses today are the Honorable Susan 

Kurland, Assistant Secretary for Aviation and International Affairs 

at the Department of Transportation. A frequent guest, Dr. 

Dillingham—we are happy you are back. Dr. Dillingham is Director 

of Physical Infrastructure Issues for the U.S. Government Accountability Office. Captain Lee Moak, also another frequent guest. Captain, thank you for being here. He is the president of the Air Line 

Pilots Association. Mr. Bryan Bedford, chairman, president and 

CEO of Republic Airways. Mr. Dan Mann, executive director of the 

Columbia Metropolitan Airport, and Mr. Brian Sprenger, airport 

director of Bozeman Yellowstone International Airport. 

Secretary Kurland, you are recognized for your statement. 

TESTIMONY OF HON. SUSAN L. KURLAND, ASSISTANT SECRETARY FOR AVIATION AND INTERNATIONAL AFFAIRS, U.S. 

DEPARTMENT OF TRANSPORTATION; GERALD L. 

DILLINGHAM, PH.D., DIRECTOR, PHYSICAL INFRASTRUCTURE ISSUES, U.S. GOVERNMENT ACCOUNTABILITY OFFICE; 

CAPTAIN LEE MOAK, PRESIDENT, AIR LINE PILOTS ASSOCIATION, INTERNATIONAL; BRYAN K. BEDFORD, CHAIRMAN, 

PRESIDENT AND CHIEF EXECUTIVE OFFICER, REPUBLIC 

AIRWAYS; DAN E. MANN, AAE, EXECUTIVE DIRECTOR, COLUMBIA METROPOLITAN AIRPORT; AND BRIAN L. 

SPRENGER, AIRPORT DIRECTOR, BOZEMAN YELLOWSTONE 

INTERNATIONAL AIRPORT 

Ms. KURLAND. Chairman LoBiondo, Chairman Shuster, Ranking 

Member Larsen, and members of the subcommittee, I appreciate 

the opportunity to appear before you to discuss the state of air 

service at small and rural communities. Like Congress, the Department understands how vitally important air service links are to 

these communities. I will concentrate my remarks on two congressionally mandated programs that the Department administers, 

which provide communities with resources to address their air 

service needs: the Essential Air Service program, EAS; and the 

Small Community Air Service Development Program, SCASDP. 

The EAS program currently subsidizes service to 160 communities nationwide, including 43 in Alaska. The program connects 

rural America with the rest of our country and, indeed, with the 

entire world. The financial investment in achieving that 

connectivity has, in a number of cases, led communities to being 

able to substantially reduce or even eliminate their need for Federal subsidy. 

For instance, between 2011 and 2013, with the right carrier, 

equipment, and frequency levels, Joplin, Missouri, saw its annual 

subsidy need drop from $2.8 million to $340,000. Further, examples 

of communities that have been able to eliminate Federal subsidies 

6 

include Rock Springs in Riverton, Wyoming; Dickinson, North Dakota; and Manhattan, Kansas. 

Unfortunately, the program’s ability to match the right carrier, 

equipment, and frequency level is becoming increasingly more challenging. Several airlines that had traditionally served EAS communities have shut down or withdrawn from the program, leaving it 

with fewer carriers and higher costs. In addition, residents of many 

EAS communities are choosing to drive to cities where low-fare 

service options are offered, thereby reducing enplanement levels on 

EAS services. 

Right-sizing equipment has also become much more difficult, because the number of regional airlines that have the appropriately 

sized equipment for the program has continued to decline. For the 

last 20 years or more, the backbone of the EAS program has been 

the 19- to 34-seat aircraft. However, those aircraft are aging and 

being retired with no replacement aircraft of comparable size. 

And, finally, a number of recent developments in the industry 

have resulted in a current shortage of pilots, which has caused a 

strain in carriers’ abilities to serve small communities. As Congress 

debates reauthorization of aviation programs, I think there will be 

an opportunity for a comprehensive discussion of these issues and 

how best to address them. And I want to commend the subcommittee for getting an early start on that process. 

The Department also administers SCASDP. Small communities 

apply for these grants, which the Department awards annually, 

based on a comparative analysis of proposals. Over the last few fiscal years, the annual SCASDP budget has been $10 million or less, 

and the Department has awarded an average of about 25 grants a 

year. 

The program has clearly experienced some notable success stories. For example, after the Department awarded a grant to the 

Akron-Canton Airport in Ohio to support new nonstop flights to 

LaGuardia, traffic increased by 100 percent. And this service is 

still in place today. Among other communities that have experienced similar success are Provo, Utah, and Harrisburg, Pennsylvania. 

Some independent reviews have concluded that the program has 

had a limited success rate. However, it is important that the criteria for measuring a successful outcome reflect Congress’ goals for 

the program. In a program designed to foster innovative approaches among communities that have had the most difficulty in 

attracting and sustaining air service on their own, there will inevitably be some grants that do not completely fulfill sponsors’ objectives. 

The Department views SCASDP as a laboratory for communities 

to explore creative ideas to develop their air service. Our transparent process in administering the program allows communities to 

learn what works and what does not, and to use its collective experience in their own air service development plans. 

Mr. Chairman, this concludes my testimony. I would be happy to 

answer any questions that you or your colleagues may have. Thank 

you. 

Mr. LOBIONDO. Thank you, Madam Secretary. 

Dr. Dillingham, you are recognized. 

7 

Dr. DILLINGHAM. Thank you, Mr. Chairman. Chairman Shuster, 

Ranking Member Larsen, members of the subcommittee, it is always a pleasure, always an honor to be invited before the subcommittee. 

Since 2001, the Nation’s airline industry has experienced considerable turmoil, including two economic downturns, the events of 9/ 

11, and rising fuel cost, as well as several airline bankruptcies and 

restructuring. Over the last 4 years, however, the airline industry 

has rebounded, becoming more profitable, in part due to the better 

management of available capacity. In fact, our research shows that 

the number of flights since 2007 has declined for all sizes of airports, with the notable exception of EAS airports. 

The situation for small communities is exacerbated by a range of 

factors, including the decline of population in small communities, 

and what we sometimes refer to as leakage of potential small airport customers to nearby airports with more frequent and lower 

priced service. Other factors on the horizon include the phasing out 

of the perimeter rule, the lack of qualified pilots, and FAA’s recent 

tentative order that EAS communities must have an average of 10 

enplanements per day to participate in the EAS program. 

My statement this morning focuses on three issues: how the EAS 

and the Small Community Air Service Development Programs have 

affected service to small communities, and suggestions to enhance 

the connectivity of those communities to the national transportation network. 

Regarding the EAS program, overall, the size and cost of the program has increased. Specifically, between 2002 and 2012, the number of communities participating in the program has grown from 94 

to 160. The total annual subsidy for the program has increased 

steadily, from $89.6 million in 2002 to as much as $225 million in 

2012. The per community subsidy has also increased during that 

same time period, almost doubling from $1 million to just under $2 

million. EAS airports, as a whole, have also experienced an increase in service since 2007. However, as of 2013, planes serving 

airports that provide EAS service were 49 percent full, while 

planes serving all airports were nearly 83 percent full. 

Regarding the Small Community Air Service Development Program, overall, the size and cost of the Small Community Air Service Development Program has decreased. Between 2002 and 2013, 

an average of about 30 grants were awarded. The total grant 

amount for the program has declined steadily from $20 million in 

2002 to $6 million in 2013. Multiple studies consistently suggest 

overall mixed results regarding the success of this program. Although the grants that could be deemed successful were in the minority, those grants did generally result in improved services, in 

terms of adding flights, airlines, and destination, and curbing customer leakage. Those grants deemed not successful generally did 

not achieve the objectives proposed in their grant application, and 

often did not sustain service or other benefits after the grant was 

completed or funding ceased. 

Regarding our suggestions to enhance connectivity, some small 

communities in danger of losing airline service or hoping to attract 

new service have opted to provide a range of incentives. These incentives include revenue guarantees like those mentioned by the 

8 

chairman that were proposed at Atlantic City International, and 

nonfinancial, in-kind contributions like advertising their air service. 

Additionally, we have recommended that DOT consider pursuing 

the goal of connectivity through a multimodal approach. This approach would explore other services, such as air taxis or ground 

transportation to larger airports might supplement the EAS program, and better serve some communities at a lower cost. DOT has 

taken steps towards including multimodal possibilities in both the 

EAS and Small Community Air Service Development Program. We 

are hopeful that these developments will help the Congress and 

DOT identify opportunities to make the EAS program more cost effective and strengthen the Small Community Air Service Development Program, thus helping to ensure connectivity for small communities. 

Thank you, Mr. Chairman. 

Mr. LOBIONDO. Thank you, Dr. Dillingham. 

Captain Moak? 

Mr. MOAK. Chairman LoBiondo, Ranking Member Larsen, and 

members of the subcommittee, I am Captain Lee Moak, president 

of the Air Line Pilots Association. And thank you for allowing me 

to be here to represent ALPA’s more than 51,000 members who fly 

for 32 airlines in the United States and Canada. Small community 

air service is an important component of our Nation’s air transportation. 

While today’s hearing is focused on this subject, the most serious 

challenge faced by this sector is one that threatens the entire U.S. 

airline industry: foreign airlines that are State-owned or supported, 

and foreign airlines that are attempting to use business models 

that conflict directly with U.S. Government policy. 

The economic threat to U.S. airlines is very real. If the United 

States fails to take action to counter it, U.S. airlines will struggle 

to compete internationally. And for that reason, I thank you, Chairman LoBiondo and Representative Larsen, for your vigilant oversight of our Open Skies Agreements. I may be biased, but I believe 

U.S. airlines and their workers are the best in the world. We just 

need to have sound Government policies that give them a fair opportunity to compete. 

I also thank both of you for your understanding of the threat 

posed by the Norwegian Air International’s flag of convenience 

business model. You represent regions with once-vibrant shipping 

industries, and know the threat that these schemes pose to U.S. industry and jobs. We urge this committee to stay engaged. 

Likewise, we respect that this committee understands that many 

State-owned and State-sponsored airlines are competing with different rules, whether it is no corporate taxes or favorable regulatory policies. The U.S. Government must level the playing field 

for U.S. airlines. 

Now, I recognize that I was invited here primarily to talk about 

an alleged pilot shortage, so I want to be clear right now. There 

is no current shortage of qualified pilots in this country. There is, 

however, a shortage of pay and benefits for qualified pilots. The average beginning pay at a regional airline is about $24,000. From 

ALPA’s award-winning involvement on aviation university camVerDate Aug 31 2005 12:17 Jan 05, 2017 Jkt 000000 PO 00000 Frm 00018 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\4-30-1~1\87701.TXT JEAN
9 

puses, we know that many new pilots will spend $200,000 or more 

on their education and flight training. Unfortunately, some new pilots are turning to other careers, because they cannot earn a living 

wage at a regional airline. 

The lack of a career path for new pilots is also a major concern, 

and some airlines—one, in particular, Jet Blue—are working to establish clear career progression to attract new graduates. In addition, thousands of experienced U.S. airline pilots fly for foreign airlines because of the pay and benefits they offer, when compared 

with U.S. airlines. Now, I know these pilots, if given the ability, 

would choose to live and work in the United States, where—if they 

were offered competitive pay and working conditions. 

ALPA strongly supports the Essential Air Service program. However, a number of EAS airlines have been vocal about an alleged 

pilot shortage. And last year some of these carriers took tens of 

millions of Federal EAS dollars, while paying their first officers 

near poverty-level wages. 

More troubling, certain U.S. airlines are attempting to use this 

contrived pilot shortage as an excuse to roll back the safety gains 

realized with the new pilot fatigue rule and first officer qualification requirements that were legislated by this subcommittee. These 

new safety requirements were developed with input from industry, 

labor, and Government. That is where we do our best work, when 

working together. The Regional Airline Association was cochair of 

the First Officer Qualifications Aviation Rulemaking Committee, 

and the airlines have had years to prepare for their implementation. 

While no shortage exists now, avoiding one in the future depends 

on whether U.S. airlines offer pilots competitive wages and benefits, and a solid career: a market-based solution. To achieve this, 

Congress should examine with DOT the Government’s relationship 

with regional airlines that accept millions of dollars under EAS 

program, while offering wages and benefits at levels so low they 

cannot fill their pilot seats. And the U.S. Government must ensure 

our industry does business on a level playing field that allows U.S. 

airlines to compete and prevail internationally by, among other actions, limiting regulatory bureaucracy and reducing airline taxes. 

In conclusion, stronger U.S. airlines mean better profits, more 

flights to small communities, and improve wages and benefits to attract and retain qualified airline pilots. Thank you. 

Mr. LOBIONDO. Thank you, Captain Moak. 

Mr. Bedford, you are recognized. 

Mr. BEDFORD. Good morning, Chairman LoBiondo, Chairman 

Shuster, who is no longer with us, but Ranking Member Larsen, 

and the members of the subcommittee. Thank you for inviting me 

to testify this morning. My name is Bryan Bedford. I am here representing Republic Airways. 

Republic Airways is a large regional airline operating in the 

United States. We employ over 6,300 people, many of them in your 

districts. We have over 600 employees in Pittsburgh, Pennsylvania. 

Aside from being a large regional airline, Republic Airways is also 

a very old regional airline. We operated our first flight in August 

of 1974 from Jamestown, New York, to Pittsburgh, Pennsylvania. 

Republic Airways is proud of its safety tradition. In our 40 years 

10 

of business we have maintained an unblemished passenger safety 

record, and it is our intention to continue that tradition. 

When I joined the company in 1999, our company operated a 

fleet of 28 turbo prop aircraft. We had fewer than 600 employees. 

Today we operate over 1,300 flights a day, all across the country. 

Last year alone we safely flew over 21.5 million passengers to their 

destinations. During my tenure through the past 15 years we faced 

extraordinary challenges in our industry. Obviously, the challenge 

of 9/11 was significant for us. The challenge of SARS, Asian currency crisis, escalating fuel prices, every one of our major airline 

partners going through restructuring, some twice, some not surviving. It has been an extraordinary time in our industry. 

And yet, the most—I think the most urgent crisis we face in my 

over-25 years in the industry is the issue of a pilot shortage. And 

while I appreciate the opportunity to speak today to the panel, or 

to the members of the subcommittee on EAS, I think that is a secondary issue to actually making sure we have competent and qualified pilots able to fly the mission. 

So, with that, rather than use my time to restate the testimony 

that I provided in written format, what I would like to talk about 

is some of the comments we have already heard from the panel 

today. 

First and foremost, we have all referenced a pilot shortage report 

from the GAO. To be factually correct, the GAO referenced the fact 

that there is a mixed indication of whether a shortage exists or not. 

But I think the analysis itself falls flat on one important point, and 

that is the data of looking at pilot wages. It cited a study period 

from 2000 to 2012, where pilot wages were decreasing, and in a 

constrained labor environment we would expect rising wages. What 

the report fails to discuss is the context of the decreasing wages, 

which is 9/11, the rampant restructuring of the airline industry. If 

the study period had been from 2008 to 2012, we would have seen 

a significant increase in wages and benefits, mainly due to the constructive engagement of Captain Moak and his leadership at 

ALPA. 

And while I am not, you know, personally friends with Captain 

Moak, I certainly respect his leadership and his engagement, especially for people that I do know and respect at Delta Airlines, who 

have been, you know, very, very complimentary of Captain Moak’s 

leadership there during Delta’s dark years. And I welcome Captain 

Moak’s leadership and that of ALPA as we talk about a very important issue. 

I also don’t disagree with Captain Moak’s market-based solutions 

approach. First officer pay does need to increase. And I can’t spend 

my limited time discussing the challenges with that, but I do hope 

the members of the subcommittee will ask me followup questions 

on compensation. 

Finally, let me give you some Republic Airways experience. Last 

year we intended to hire 500 new crewmembers. We found over 

2,400 qualified applicants, based on the current statute. We were 

only able to find 450 pilots that met our hiring standards—450 out 

of 2,400 ‘‘qualified applicants.’’ Rather than hiring 50 pilots that 

didn’t meet our standards, we decided to take the unprecedented 

step of parking aircraft, grounding 27 of our small regional jets, 

11 

and leading to the disconnection of service to numerous small 

towns, and even medium-sized communities in our countries. 

Republic Airways is not going to sacrifice its standards and its 

safety culture to hire marginal pilots. There are, however, plenty 

of qualified applicants that do not meet the current legislative requirements. 

So, what do I think we need to do? First, we need the committee 

to urge the FAA to use the full flexibility provided under the statute. What do I mean by that? Well, the—which Captain Moak referenced, which the RAA did participate on, did make recommendations. They simply weren’t accepted by FAA. We need the recommendations to be the accepted standard for hiring new pilots in 

our profession. 

Secondarily, the FAA took a very rigid view, a very narrow view, 

of the word ‘‘academic,’’ in terms of providing experiential training 

credit. And sitting here today, I believe we have fewer than 25 universities that have been accepted under the FAA’s criteria for academic training. We need that expanded to be inclusive of all structured academy-type training. 

And then, finally, we do urge the committee to consider the viability of the profession, in terms of assistance in vocational training 

for new—the next generation of pilots entering the workforce. 

This is a serious issue. I do sincerely appreciate the opportunity 

to participate in the panel today so that we can have a serious debate about it. But, at the end of the day, if we work constructively 

together, I am confident we can find a solution that will allow us 

not only to maintain the safest aviation system in the world—and 

also provide a significant service to small and medium-sized communities. Thank you. 

Mr. LOBIONDO. We thank you, Mr. Bedford. 

Mr. Mann, you are recognized for your statement. 

Mr. MANN. Mr. Chairman, members of the subcommittee, thank 

you for inviting me to participate in the hearing today. It is an 

honor for me to be here. My name is Dan Mann, I am the executive 

director of the Columbia Metropolitan Airport. And this is my third 

airport where I have been the director. 

Each airport and community had the same concerns and goals. 

They all wanted better service to improve economic development efforts. The message is the same: better fares, more direct flights, 

and reliable service. To meet those goals, what I found to be consistent and effective is to first get the airport financial house in 

order, and, second, make sure the community has realistic expectations. Only after you have a solid airport business plan and community support can you be effective offering creative incentives to 

airlines for improved service. 

In Columbia, the challenges were especially great. Compared to 

20 similar-sized airports, our costs were over $12 per passenger, 

our debt was excessive, and we had the highest number of employees of the 20 benchmark airports. That, in addition to the challenge 

of being a 11⁄2-hour drive from Charlotte, the sixth largest airport 

in the country. We had to do some significant changes to our business plan. We had to do community outreach to have any hope at 

all of keeping the air service we had and growing. 

12 

After a significant reorganization, we reduced debt by $20 million. We reduced staff from 120 to 65. And we were able to get our 

costs to below $9 per passenger. 

Fortunately for Columbia, we had a good economy, a growing 

population, and, after our financial position improved, we were able 

to make a business case to Delta Airlines for more capacity and 

competitive air fares. After 6 years of declining enplanements in 

Columbia, we saw growth in 2012 and 2013. And pending good 

weather, we think 2014 is also going to be a good year for us. 

While incentives were not required in Columbia, I have used a 

SCASDP grant on two occasions at two other airports. Again, only 

after we had our airport finances in place, and community support, 

were we able to have a good plan for the community outreach 

grant. 

In Casper, Wyoming, we actually bought an aircraft. It was kind 

of a crazy scheme, but we bought an aircraft. We had an airline 

that was willing to lease it beforehand. We applied for the grant 

and was awarded that. We bought the airplane, leased it to the airline, and generated enough passengers to have follow-on service 

with Northwest Airlines to Minneapolis, Saint Paul. That service 

stayed in place for several years, and up until the merger of Delta 

Airlines. The good news about that is it was an asset that we were 

able to sell at a later date, and we reimbursed the SCASDP grant 

nearly the entire amount of the grant monies. 

At each airport their service challenges were great. And I believe 

the solutions must come from airports on a local level. And the best 

assistance we can get from the regulatory bodies is bringing more 

flexibility and control with airport-generated revenue. I think airports that have a good, solid financial plan and local support can 

come up with their own solutions, and that is probably the best alternative. 

The best chance of success—even with some business plan and 

community support, not all communities will be able to sustain 

commercial service. That is just the fact of the business run today. 

But the best chance we have is engaging community, local control 

of airport revenue, and having the folks—free market enterprise 

support us. 

Thank you for the time, and I will be happy to answer any questions you may have. 

Mr. LOBIONDO. Thank you, Mr. Mann. 

Mr. Sprenger? 

Mr. SPRENGER. Chairman LoBiondo, Ranking Member Larsen, 

members of the subcommittee, thank you for inviting me to participate in this hearing on air service to small and rural communities. 

My name is Brian Sprenger, I am the airport director at Bozeman 

Yellowstone International Airport, a small-hub airport located in 

southwest Montana. 

First of all, I want to thank the members of this subcommittee 

for your continued commitment to our aviation transportation system. Aviation provides remote States such as Montana access to 

the world, and a strong aviation system is imperative for our continued growth. 

Mr. Chairman, our airport has been fortunate to see a strong, 

consistent pattern of growth over the past 40 years. Even through 

13 

the challenging last 15 years, we have seen growth rates averaging 

5 percent per year. In 1999, our airport handled 436,000 passengers, and this year we expect to handle nearly 1 million. Certainly, we have the advantage of the real estate adage, ‘‘Location, 

location, location.’’ That being said, we have a philosophy at our 

airport that focuses everything we do on making our airport attractive and competitive. Simply put, we believe the airlines are the 

golden goose for smaller airports, so don’t kill it. 

The airport industry has become quite competitive. We are competing for the same seats because the airplane servicing the Bozeman market could just as easily be servicing the Atlanta market. 

And we are now seeing a rationalization of airports, and the reality 

is not all airports will be able to retain or maintain the same level 

of service they now have. 

Consequently, we operate our airport more like a business than 

a Government agency, and we think of our airlines more like anchor tenants in a mall. We have to be competitive. We strive to 

have one of the lowest costs per enplanement for our airline partners. We provide ease of entry and exit to our market, and favorable gate access for all airline models. We have strong partnerships 

with our community. We also believe airports and communities 

must have skin in the game to succeed in air service development. 

And, finally, we have invested nearly $5 million in services normally provided by the Federal Government, such as air traffic control, because Federal agencies are slow to adapt in the changes in 

air service dynamics. 

Airlines can move assets quickly, and it is not uncommon for 

smaller airports to see drastic changes in air service. But we need 

level playing fields, so that comparable airports have comparable 

Federal services. We need our Federal agencies to be able to adapt 

quickly and have mechanisms in place to provide services commensurate with the activity level of an airport on a fair and equitable 

basis. We also need policies that support and encourage airports in 

developing nonaeronautical revenue, so that airports can minimize 

reliance on revenue from the airlines. 

Mr. Chairman, the Bozeman Airport has benefitted from the Federal Contract Tower program and the Small Community Air Service Development grants because of its significant airport and local 

community investments. We have not shied away from doing our 

part to make those programs and others succeed at our airport, 

and believe that airports and communities must have a vested interest for success. We encourage Congress to continue to modestly 

invest in programs that help small airports and communities attract and invest in viable commercial air service, as well as operate 

safely. 

In conclusion, Mr. Chairman, Ranking Member Larsen, and 

members of the subcommittee, thank you again for inviting me to 

participate in this hearing on air service at small and rural communities. I would be pleased to respond to any questions or comments you may have. 

Mr. LOBIONDO. Thank you, Mr. Sprenger. I am curious about one thing in your statement. You said your airport spent $5 million to 

supplement air traffic control. Did I hear that right? 

Mr. SPRENGER. That is true. 

14 

Mr. LOBIONDO. How did that work? 

Mr. SPRENGER. Well, it is a combination of things. We spent $1.5 

million to build our first air traffic control tower about 15 years 

ago. We spent another $1.5 million to put in a radar in our valley. 

We spent another $500,000 to put a radar display inside the tower. 

We also spent about—almost $1 million in—augmenting our air 

traffic control by adding an hour at the beginning of the day and 

an hour at the end of the day, just to have coverage when our airlines were operating in and out of the airport, because the contract 

tower program would not provide that within their own funding. 

Mr. LOBIONDO. So you had to do all this through the FAA, obviously? 

Mr. SPRENGER. Correct. 

Mr. LOBIONDO. So you all had an idea that would enhance your 

ability with safety, and to run the airport, and then you proposed 

that idea to the FAA, they signed off on it, and you spent your 

money? 

Mr. SPRENGER. We spent our money and—some of those projects 

took a decade to achieve. 

Mr. LOBIONDO. OK. For Mr. Mann and Mr. Sprenger, I am curious about your cost per enplanement. You talk about that a little 

bit. How are you keeping it down, or how does this impact your 

business decisions? Talk to me a little bit about that number? 

Mr. MANN. Our costs in Columbia were—in 2010, when I arrived 

there, were well over $12. And we have been having declining service. I met with all the airlines, and every one of them said, ‘‘Dan, 

you are just not competitive, and it is a mobile asset, we are going 

to move it.’’ We had to get our costs under $10. That was the airline’s goal for us. 

And again, we had to do that by paying down debt and eliminating employees. We had 120 employees. It was the most of any 

of the benchmarked airports, and we had to completely reorganize. 

So we got down to 65, saved about $2 million a year. The debt reduction saved about $3 million a year. And we were able to get it 

to $9. We are doing that just by running it like a business. I mean 

it really comes down to are we going to be effective at $12, and the 

answer was no. And so we had to get the costs down. And again, 

we focus on customer service and safety, and everything else was 

a luxury item. 

And so, once we got those costs down, we went primarily to Delta 

Airlines, and they responded with more capacity. And it was really 

just—if we wanted to be competitive, we had to take control of our 

own business model. 

Mr. SPRENGER. I would echo what Mr. Mann has said. Our cost 

is actually exceedingly low. Our cost per enplanement is right now, 

in the coming year, about $2.74 per passenger. 

Mr. LOBIONDO. $2.74? 

Mr. SPRENGER. Yes. 

Mr. LOBIONDO. OK. 

Mr. SPRENGER. We focus—go ahead. 

Mr. LOBIONDO. No—— 

Mr. SPRENGER. OK. 

Mr. LOBIONDO. It is a great number. 

15 

Mr. SPRENGER. We focus on two things. Obviously, the first thing 

is expenses. Like Mr. Mann said, you know, we try to maintain our 

expenses as low as we possibly can, yet providing a world-class airport. But we also look at the revenue side, where we basically work 

on generating revenue from all of the nonaeronautical portions of 

our airport: the rental cars, the parking lot, the concessions inside 

the terminal, land rent. Anything that we can do to generate revenue elsewhere helps us lessen the burden on our airline partners. 

Mr. LOBIONDO. Mr. Bedford, how does Republic Airways interact 

with the airports on this number, the enplanement number? 

Mr. BEDFORD. Well, it depends, sir. When we are offering services essentially on a pro-rate basis, then yes, we are directly involved with meeting with the airport officials and trying to come 

up with a win-win construct for new service. As Assistant Secretary Kurland said, we were actually one of the services that 

opened from Provo, Utah to Denver using jet aircraft. And that was 

a collaborative effort, to actually build the airport and then work 

with the SCAD grant and establish service, which actually was successful until our business model changed. 

When we are operating with our major airline partners’ brands— 

Delta, United, US Airways, American—they are actually the primary interface with the airport community. They are deciding 

where the aircraft will operate, when they will fly. They are setting 

the prices and managing that relationship with the ground personnel. 

Mr. LOBIONDO. Dr. Dillingham, in your statement you indicated 

that there are many factors that contribute to the decrease in demand for air service for small and rural communities. What would 

you say are the most important among those factors, and why do 

you think they are the most important? 

Dr. DILLINGHAM. Thank you, Mr. Chairman. I think the two most 

important factors would be, first of all, population decline. We have 

seen a significant decline in population in rural and small communities over the last 10 to 15 years. So that affects demand. And the 

other factor, I think, is something that was mentioned by several 

people on the panel. That is leakage. When you are able to or you 

choose to drive to a larger airport with more service, and sometimes cheaper prices for the Southwest or Jet Blue, you take that 

option. So those are the two factors that I think contribute to that 

lessening of demand, which, in turn, the airlines, you know, with 

their adjustment of capacity, will lessen their service to those small 

communities. 

Mr. LOBIONDO. Captain Moak, did you want to add something? 

Mr. MOAK. I just wanted to add one thing. Everybody is kind of 

talking around the issue that is driving a lot of this, and that is 

the economics of the industry. 

Mr. LOBIONDO. Could you pull your mic a little closer? 

Mr. MOAK. Absolutely. The economics of the industry are what 

is driving a lot of this. If you just go back to 2009, to the current— 

to 2014, oil has doubled. It has to be spread over a number of seats. 

We have had a couple of inappropriate taxes and regulations that 

have come into place. One would be the $100 TSA fee that goes to 

debt reduction, for example. Tickets are market-based. This has 

driven ticket prices up, and it has had an effect at small commuVerDate Aug 31 2005 12:17 Jan 05, 2017 Jkt 000000 PO 00000 Frm 00025 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\4-30-1~1\87701.TXT JEAN
16 

nities that is starting the regionalization of the airline industry, 

where people are having to make a decision if they are going to 

drive or not to an airport like the doctor has pointed out. 

You can’t emphasize enough how the economics are playing into 

what is going on here and the changing business model. That is 

what is driving it. 

Mr. LOBIONDO. Thank you. Mr. Larsen? 

Mr. LARSEN. Thank you, Mr. Chairman. Mr. Bedford, could you 

elaborate a little bit on your recommendation, or your comment 

about a recommendation that Congress should direct the FAA to 

use its authority to be more flexible on the pilot safety training 

rules. 

Mr. BEDFORD. Yes, sir. When the statute was first enacted, it required an aviation rulemaking committee to work with FAA and all 

the various stakeholders, including the Regional Airline Association and ALPA, among others. In that process, they came up with 

a series of recommendations for the implementation of the statute. 

They were not implemented according to the ARC recommendation. 

And, instead, what we have is the current implementation of the 

statute, which does provide limited relief for academic training 

credit, but not enough relief. 

And so, essentially, what we are now asking the next generation 

of pilots to do is to graduate with, you know, high levels of proficiency and skill-based training, and then we are asking them to 

now spend the next 12 to 18 months essentially flying circles in the 

sky in single-engine piston aircraft and fair weather conditions 

which, frankly, does nothing to improve the overall safety proficiency of the pilot. 

In fact, you know, our experience is it leads to the creation of bad 

habits which, frankly, we have a hard time training out of potential 

airmen, which is why I think we are seeing such a high rejection 

rate of ‘‘qualified candidates’’ that do not meet our standards. 

Mr. LARSEN. All right, thanks. Captain, do you care to respond 

to that? 

Mr. MOAK. So what I think we should focus on—and on this 

issue in particular—is the good work of this subcommittee, of DOT, 

and of FAA, by setting up that process. 

And then, out of that process, we were actually able to come up 

with a restricted ATP, answering the community by being smart 

and engaged. The restricted ATP, you come out of the military with 

that training, you get that at 750 hours. Dependant on the university program that you are—have completed, you can get one at 

1,000, and then there is one perhaps out of Embry-Riddle, 1,000, 

and then a different one at 1,250, ultimately with 1,500. So, I believe that we addressed those then, OK, and it was a smart way 

to address it. 

But I do kind of want to focus back on your question quickly 

here. You know, we are—some carriers, perhaps, are having trouble recruiting some FOs, and I have tried to point that this is a 

market-based problem, based on the pay that we are paying them. 

And if this was a conversation that we were having about hospitals 

and hospitals having trouble getting doctors, we wouldn’t be focused on the certification or the education reducing that, so that 

we could get doctors in to fulfill seats. We wouldn’t be doing that. 

17 

So, what we need to be doing here today is focused on the economics that are driving the problem. And, like Mr. Bedford said, 

the major airlines, the brands, are not in the room today. And they 

are the ones that are making decisions, what small communities 

you fly to, what frequency at hub airports, they are making those 

decisions. And they are the ones that are pulling service down, 

based on the economics of the routes. The economics are driving it. 

Mr. LARSEN. Dr. Dillingham, in your report you report the data 

indicate that ‘‘a large pool of qualified pilots does exist, relative to 

projected demand. But whether such pilots are willing or available 

to work at wages being offered is unknown.’’ Does an adequate pool 

of qualified pilots exist to meet projected demand by the airlines? 

Can you answer that in a yes or a no? Is that possible? 

Dr. DILLINGHAM. [No response.] 

Mr. LARSEN. All right. 

Dr. DILLINGHAM. OK. 

[Laughter.] 

Mr. LARSEN. I asked the question—— 

Dr. DILLINGHAM. Yes. 

Mr. LARSEN. You answer it the way you want to. 

Dr. DILLINGHAM. OK. So the short answer is yes. But I want to 

go back to something that has been said on the panel by Mr. Bedford and others to sort of clarify what the GAO report actually reported. 

Mr. LARSEN. Sure. 

Dr. DILLINGHAM. It was one of those reports, Mr. Larsen, where 

everybody found something in it that they liked, and they used it 

to their best interest. We, in fact, said, by the numbers, the BLS 

numbers, the labor statistic numbers that we used, that two out of 

three indicators indicated that there was not a pilot shortage. 

Secondly, we also said that the regional airlines were, indeed, indicating that they were having a difficult time finding qualified 

first officers. We also said in that report that the major carriers 

said they were not having a difficult time finding qualified pilots. 

And directly to your question, what we also said in the report is 

that there is a projected need of about 10,000 pilots over the next 

few years, and we found information that indicated that there were 

some 70,000 qualified pilots—qualified meaning that they had the 

ATP, they had the first-class medical—and they were working in 

various other occupations, some nonairline, some airline, some in 

foreign countries. 

So, you know, the direct answer is, you know, those pilots are out 

there. Why the regionals are having a difficult time is something 

that the regionals can speak to better than I. Thank you. 

Mr. LARSEN. Thank you. Mr. Chairman, that is fine for now. I 

may have a second round. Lot of Members here, so I will yield 

back. 

Mr. LOBIONDO. OK. We are now going to turn to Mr. Hanna. 

Mr. HANNA. Thank you, Chairman. Mr. Bedford, Mr. Moak, it is 

fascinating to me that we are talking about something that is kind 

of—we are both talking about market-based solutions, right, and 

yet we have pilots who—clearly, $24,000 a year is underpaid. And 

yet you had 2,500 applications, you were able to find 470-something that fit your requirements. 

18 

So, that is almost contradictory in its nature, that we have somebody who—both people believe in the market. Your pilots are underpaid. You can’t find enough pilots. I feel like I am missing something in this conversation, here. We are talking about training people to be prepared. We have requirements to train them, but they 

don’t meet what you want. 

I guess I would love to hear the two of you talk about that together, because it sounds like you are really arguing from the same 

position, but—and for the same people. So, Mr. Bedford, why am 

I getting a headache over this? 

Mr. BEDFORD. Well, trust me, Congressman, I share your headache. I think the—you know, we are splitting hairs on what is the 

definition of qualified. There is a statutory definition that has now 

been codified in the form of the FAA’s rulemaking process, which 

Mr. Moak spoke to, that discussed qualified as being someone with 

1,500 hours and an ATP. I can assure you that having 1,500 hours 

and an ATP does not make you qualified to fly as a commercial airline pilot. 

So, yes, there may be 70,000 registered ATP holders. I don’t 

know how old they are. I am probably in that database somewhere. 

I am not qualified to fly any more, OK? But that doesn’t mean we 

don’t have a shortage of qualified pilots. You know, Mr.—or, I am 

sorry, Captain Moak; I don’t mean to disrespect you. 

Mr. MOAK. No problem. 

Mr. BEDFORD. Captain Moak talked about, you know, equating 

this to hospital training. Well, you know, we don’t take, you know, 

people who are newly emerged from medical school, and then send 

them off to be, you know, library technicians or something, you 

know, letting their skills atrophy. And what we find is young men 

and women coming out of qualified training programs, when we 

hire them, as long as they don’t have bad habits, we invest another 

$30,000 in training them to our requirements. 

As far as entry-level pay and market-based solutions, I absolutely agree with Captain Moak on this. FO wages are too low. 

Mr. HANNA. There must be something attractive about being a 

pilot, Mr. Moak. I am a pilot. I am the most dangerous one in the 

sky; I am a private pilot. But when people will actually take 

$24,000 a year, there must be some expectation that they will do 

better later, because that is starvation wages. So part of that must 

be the market that they are anticipating, or the shortage that must 

exist, although you would suggest—one would suggest that with 

that kind of pay, people are willing to do it, supply and demand 

might suggest a whole number of things. But go ahead. 

Mr. MOAK. So, Congressman Hanna, first, being a seaplane pilot, 

certificated like yourself, you are probably one of the safest pilots, 

because I see you sitting here today, and I know how difficult that 

flying is, to be able to reuse the—— 

Mr. HANNA. So far so good, you know? 

[Laughter.] 

Mr. MOAK. There you go, there you go. But look, the issue here 

is the market has changed. There was a glut during what was considered the deregulation bankruptcy period. When this Congress 

deregulated the airline industry, it did it for scheduled service 

product. It didn’t deregulate with the idea that we would compete 

19 

on safety, security, or labor. That wasn’t the idea. It had the vision 

and the foresight to protect small communities with EAS programs 

and others. Great. 

So now, many years later, we are at this point. And at this particular point, the market rates for entry-level FOs who are going 

to college, who are getting their certificates, are much higher than 

the union contracts. People are competing for our best and our 

brightest coming out of college. They are competing for it. They are 

going overseas. Some are going directly to mainline. 

So, what we have going on here is the right regulations, the right 

oversight, the right certification that this group, again, had the vision to put in place with FAR 117 that now guaranteed that a pilot 

would not be fatigued during his rotation, that he would—imagine 

this—he would get 8 hours behind the door at a hotel so he could 

be rested. Those things are all good, they are positive. But what 

is going on is merely a economics and market problem for some 

carriers. The solution is to compete and pay more. That is the solution. That is what we need to focus on. 

Mr. BEDFORD. If I may just add a quick commentary, first of all, 

there are—flying is one of the best jobs in the world. You have 

been up there, I have been up there. Until you do it, I mean, it is 

hard to really put into terms just the beauty and the fulfillment 

that you get. And it is a serious business, though, and it doesn’t 

work for everybody. So you can go out and you can get time and 

you can get ratings. That doesn’t, again, qualify you as a pilot. 

What is unfortunate, I think, is a regulation that limits the ability of truly qualified pilots to actually practice their craft, and 

forces them into a time consuming, laborious, unproductive, 

unstructured, and unhelpful, and financially draining process of accumulating time, simply to check a box. Either our training programs are safe and proficient or they are not, and the FAA should 

de-certify any airline that cannot operate to a single level of safety 

equivalent to any major international carrier. That ought to be the 

focus. Either pilots are proficient and safe, or they have no business being in a cockpit. 

And I would challenge the fact that the arbitrary nature of how 

the ultimate regulation was imposed, was codified, is not fulfilling 

the desires of the families of Colgan Air flight 3407. It is not building safety into the cockpit. In fact, I fear it is pushing us in the 

other direction. We may have less qualified guys, although qualified per statute, potentially coming into these cockpits. And I think 

we do that at great risk. 

Now, as far as the economics are concerned, Republic Airways is 

a highly unionized company. Over 75 percent of our employees participate in labor unions, predominantly the International Brotherhood of Teamsters. Our flight attendants, our pilots, our dispatchers all participate in labor organizations. We respect the process. 

But on numerous occasions over the past 3 years, without any 

hooks into Section 6 bargaining, we have attempted to dramatically 

increase first officer pay, which, by the way, in the first year of employment at Republic Airways, first officers compensation is in excess of $30,000, on top of additional $6,000 in health care and 

401(k) contributions that come to the pilot, on top of the $30,000 

20 

of investment we make in training them to our specifications. So 

there is an extraordinary amount of investment. And that is career 

investment that they will carry with them throughout the entirety 

of their career. 

Why do people work for $30,000 a year? The goal is to get to mainline carriers, where they are going to enjoy $150,000 to 

$250,000 in compensation. Should we regulate—should we tell 

Apple Computer—should we tell Apple that you can only hire employees that have 10 years of experience? 

Mr. LOBIONDO. Mr. Bedford, I am sorry to interrupt you. 

Mr. BEDFORD. Sorry. 

Mr. LOBIONDO. We are trying to be flexible here—— 

Mr. BEDFORD. Thank you. 

Mr. LOBIONDO [continuing]. But we are trying to be respectful of 

the other Members’ time, as well. And if we need to, we will come 

back in a round two if you want to continue. 

Mr. BEDFORD. Thank you. 

Mr. LOBIONDO. Mr. Nolan, you are recognized. 

Mr. NOLAN. Thank you, Mr. Chairman. I want to thank the 

panel for their candor and their testimony here. It has been very 

interesting and enlightening. 

Mr. Chairman, first I would like to ask unanimous consent that 

a statement by Bob Anderson, the mayor of International Falls, 

Minnesota, the coldest spot in the Nation, be included in the 

record. 

Mr. LOBIONDO. Without objection, so ordered. 

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Mr. NOLAN. And then, secondly, I would like to ask unanimous 

consent that a statement by our former chairman and our colleague, Jim Oberstar, also be inserted into the record. 

Mr. LOBIONDO. Without objection, so ordered. 

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Mr. NOLAN. Thank you, Mr. Chairman. I will yield the rest of my 

time, and if my questions don’t get answered I will pursue them 

at the end of the hearing. Thank you. 

Mr. LOBIONDO. Mr. Nolan, we thank you. Mr. Daines, you are 

recognized. 

Mr. DAINES. Thank you, Mr. Chairman. I have some questions 

for Mr. Sprenger. Mr. Sprenger, thank you for coming to Washington to testify. You truly have set a great example as leading a 

successful airport management model. I thought the metrics you 

shared were very impressive. And I guess I am a little bit biased, 

given that is my home airport, Bozeman, Montana. My mom and 

dad moved to Bozeman in 1964. I went to kindergarten through 

college there, and I have really watched the transformation of what 

has happened there, at that airport. 

And I also want to compliment you on the tremendous service 

provided to our community and the economic driver. As was mentioned earlier, we were able to build a company there in Bozeman 

that virtually started from nothing to 1,100 employees with 17 offices around the world, a product with 33 languages. I managed 

Asia Pacific with offices in Tokyo and Sydney, headquartered and 

living in Bozeman, Montana, because I had an airport I could get 

in and out of every week. That business capitalized at $1.8 billion. 

So we built a large business. Had it not been for Montana State 

University there supplying graduates, as well as universities across 

Montana, and a great airport, we could not have done it. It is as 

simple as that. So thank you. 

Mr. SPRENGER. Thank you. 

Mr. DAINES. I was struck by the metric you shared on the cost per enplanement, that CPE number of sub-$3. And when I looked 

at your testimony, the average profit per passenger, the airlines, is 

about $4.13, as I saw from the 2013 numbers. Obviously, that is 

a pretty—$4.13 is a pretty small number. And keeping your numbers sub-$3 on the CPE, very, very impressive. How did you do 

that, and what recommendation would you give to other small airports? 

And, by the way, for those who have not been to Bozeman Airport, when you see these low-cost numbers, I can tell you that 

Bozeman Airport is one of the nicest airports in the world, and I 

have been to most of them. It is an amazing airport, in terms of 

the quality of service, the ambience. And that is why a lot of folks 

come in and out of there. 

But explain to us how you achieved these incredibly efficient 

numbers. 

Mr. SPRENGER. Well, one of the first parts on the cost side is 

maintaining our personnel costs. Personnel costs are one of the biggest costs that we have at the airport. And our full-time equivalent 

employees is about 31. We think sometimes one of the benefits of 

being a growing airport is that we started small, and we have tried 

to remain small, especially on the staff side. So, being able to maintain those costs has been an important part. 

But, like I mentioned earlier, as equally important is generating 

the revenue from other sources, and relying on that revenue, and 

not just increasing your costs—because you can also increase the 

cost to the airlines; that is a conundrum that I think many airports 

28 

get into. And we don’t do that. We very much focus on continually 

lowering our airline cost per enplanement, quite honestly, because 

we are competing against every other airport in the country for 

seats. And you know, one of the only things that we can do to compete is to have our costs low. 

Mr. DAINES. Yes. And you would think—I guess Bozeman is a 

smaller airport, but you are the busiest now in Montana. And, congratulations, it looks like you are going to hit a million passengers 

in 2014. Impressive growth. 

Mr. SPRENGER. Thank you. 

Mr. DAINES. And a lot of those passengers come in July and August, I know, when there is a certain thing called a trout that 

seems to be running around the streams of Montana. I was fly-fishing in Montana before Brad Pitt ruined it for the rest of us, I have 

said. 

But let me ask you this. In your testimony you discuss the role 

of—a contract tower plays at the Bozeman Airport. Could you 

elaborate further on this point? 

Mr. SPRENGER. Well, we are a contract tower program airport. 

And it has worked extremely well for us, from the standpoint it got 

us a tower when we would not have been able to justify a tower 

15 years ago. The challenge now is that we have grown to become 

a small-hub airport, and the contract tower program is really designed for the smaller airports around the country, and there is 

really no mechanism for the FAA to really allow airports to grow 

into either a Federal tower, or shrink from a Federal tower to a 

contract tower. 

And that means that, for us, there are airports of comparable 

size that have substantially more services than what we do. And 

we have a staffing level of only five controllers and one manager 

to really accommodate 18 hours a day. It creates challenges when 

we have periods of time during the day where we may have 80 

landings or take-offs in an hour. 

Mr. DAINES. Mr. Sprenger, I am running out of time. I am going 

to ask you. If you were to give us one recommendation—one or 

two—for the FAA and for this committee that would help make 

your life easier—trying to do here—of running one of the most efficient airports in America, in terms of CPE, what would that be? 

Mr. SPRENGER. Have services commensurate with the size of the 

airport so that, as you grow, you get more services. As you shrink, 

you accordingly have services that are appropriate for your size. 

Mr. DAINES. OK. Thank you. I am out of time, Mr. Chairman. 

Thank you. 

Mr. LOBIONDO. OK. Thank you, Mr. Daines. Now we go to Mr. 

Bucshon. 

Dr. BUCSHON. Thank you, Mr. Chairman. I will use a few health 

care analogies. I was a heart surgeon before I came to Congress. 

And I think—I am very interested in the pilot pay issue, because 

I had a young man from my district that came in who was a pilot 

for a regional airline, and we discussed this issue. 

And, you know, I do kind of see it in the context of medical training, also. I mean, you know, you don’t come right out of medical 

school and do open heart surgery. You don’t probably come right 

out of college and, you know, immediately fly a 747, you know, 

29 

across an ocean. And so, I do agree with the free market approach 

to that. And it appears to me, as long as young people are willing 

to take a job for, whatever, $24,000 a year, as long as that supplydemand balance is there, people will continue to—you know, the 

pay will be an issue. 

But it is like residency training programs. You know, when you 

get out of medical school, your pay is not consistent with a practicing physician. And I do see it as a—you know, a stepping stone 

to advance to a higher level. 

I mean—and then that—the other issue is the—I was really curious about what—the difference between the captain and Mr. Bedford said about training, and talking to Mr. Hanna about this 

issue, you know. In medicine, if you do multiple, multiple hernia 

surgeries, it doesn’t qualify you eventually to be a heart surgeon. 

You actually have to do things that—you know, you have to advance and do more advanced training that gets you there. That 

seems like a similar analogy. 

That is why I am wondering, Captain, why is there a little disagreement, you know, under the—kind of an undercurrent of disagreement about the training qualifications between Mr. Bedford, 

maybe the airlines, and what the pilots see? 

Mr. MOAK. Just real quick, I have two slides I would like to show 

that answers this, if I could bring them up, if available. And one 

of them is actually a compliment to Mr. Bedford’s company. And 

if we could pull them out quickly, I think it would help illustrate 

it. 

The first one is just to show you the economic part really quickly. 

And this gives you an idea—if you could, hold up the fuel one. 

[Slide] 

Mr. MOAK. This gives you an idea of what has happened over the 

last few years on a barrel of fuel. It completely—it has gone up so 

much that it covers the entire cost of a pilot. Now, companies can’t 

control this variable, OK? They can control pilots costs. Economics 

are the biggest problem for small communities. 

[Slide] 

Mr. MOAK. The second slide, the second one, is simply a 

proactive action by Republic Airways. And this is an ATP ad 

where, for approximately $70,000, after you have gotten some certificates, Republic Airways will give you an interview. They actually show up and they do the right thing, they are out there recruiting pilots, and trying to get their qualifications in this program. That type of proactive action is—we need more of that. 

So, I think the difference we—I will speak for me. A difference 

that we are seeing here is I believe we are kind of beating around 

that this is an economic issue that the market has changed, that 

if we don’t adapt we are going to fail. And we got to focus on the 

primary driver. Now, near-term, some properties may be having 

this problem. But I can’t force pilots to work for reduced wages, nor 

would anybody want that. 

And, back to your original question on heart surgeons, we have 

people in the room today and people that I believe, when a customer buys a ticket—when they buy a ticket, they expect the same 

quality operation from start to finish. And if you are getting your 

30 

heart or brain—and I guess, in my case, brain surgery—done, you 

want to make sure that you have the person that has been—— 

Dr. BUCSHON. Yes. Let me just say I am in full agreement that 

pilots are—these pilots are underpaid, because they have the trust 

of the flying public, and the—you know, and when you do step on 

an airplane, you don’t really think that one pilot is going to not be 

quite as good as another pilot. I mean it—for every level of flight, 

the pilot has to be really good, because people’s lives are on the 

line, you know, if you mess up. 

But I am also not one that believes that we can fix prices for 

whatever employment there is. You know, you can’t—so it has to 

be some sort of a—to get the pilot pay, it has to be some sort of 

supply and demand issue to get the pilot pay up, and that may 

mean, if there is a—you know, if there is a developing shortage of 

pilots—and I think there probably is, because there is—health care 

providers are in shorter supply, too—that eventually those wages 

will have to go up because of sheer competitive forces. And I think 

it is a very difficult situation. All of us also may be—some of the 

school teachers that are teaching our kids we feel, I feel, are underpaid for what they do. But that is just the market. 

So, what do we do about it? Mr. Bedford, do you have any comments? 

Mr. BEDFORD. Yes, Congressman, I do. Part of the challenge we 

have—and I would appreciate Captain Moak’s feedback on this— 

is, you know, we are in an organized labor situation. On multiple 

occasions we have actually tried to increase first officer pay by over 

25 percent. And it has been—essentially, our union won’t allow us 

to do it. And it is hard to square the circle when your union says, 

‘‘Our employees, you know, need more money,’’ and yet they won’t 

let us pay them more money. So I would very much be interested 

in Captain Moak’s, you know, just expertise as to why, you know, 

labor unions actually reject pay increases when—— 

Dr. BUCSHON. Thank you. My time has expired, so I think we can 

finish this later on. Thank you, Mr. Chairman. 

Mr. LOBIONDO. OK. Mr. Graves, you are recognized. 

Mr. GRAVES. Thank you, Mr. Chairman. My question is for Mr. 

Bedford. The pilot shortage has been something I have been looking at for a long time, and qualifications. And I would like for you 

to expand a little bit, too, on—you know, Mr. Dillingham talks 

about the number of pilots that are out there. And I am a recent 

ATP and I have got 3,500 hours, so I fall into that category. 

Mr. BEDFORD. Are you available? 

[Laughter.] 

Mr. GRAVES. But I am not qualified to do that. And you just held 

up that—reminded me, that slide that was held up, you know, advertisements for the ATP school. Nothing against the ATP school, 

but you can go on a one-day course, pay your $295, pass your ATP 

test the next morning for part 121, and you know, and we have got 

guys out there that are, you know, young, just building time, that 

is all they are doing, building time to 1,500 hours to take that, you 

know, one-day ATP course. And then, hopefully, jump in the right 

seat. But you and I both know that they are not qualified. 

And I would like you to expand on that a little bit, because I 

know pilots out there—in fact, we got combat pilots that are 22 

31 

years old, going into combat at 300 hours. And it is about the decisionmaking qualities that they have. It is all about the decisionmaking mentality that they have. You know, I know pilots that are 

not ATPs, they are commercial, they are crop dusters, and I would 

much rather step into an airplane with them than I would—there 

is guys out there that have 20,000 hours that I wouldn’t fly, if my 

life depended on it. And it does. That is the bottom line. 

We both know what it is about. It is about cockpit resource management, it is about how you handle yourself in the airplane, it is 

about how you make that decision. Would you expand on that just 

a little bit, on what you consider qualified pilots? Because I am so 

damn frustrated about this arbitrary figure that we put in out 

there, when it comes to just as long as you got 1,500 hours you are 

going to be good enough to fly. And that is just simply not the case. 

And now we have a pilot shortage, because we don’t have the folks 

that you are talking about that really have what it takes to, you 

know, to fly passengers for hire. I would be very interested in you 

expanding on that, Mr. Bedford. 

Mr. BEDFORD. Thank you, sir. Yes. Well, I agree with you completely, you know. Arbitrary rules are very generally unproductive. 

And, to clarify, Republic Airways is not in support of any repeal of 

FAR 117. So—— 

Mr. GRAVES. I am. 

Mr. BEDFORD. Well, look, I believe crewmembers do need adequate rest, and we should all play by the same rules. Having said 

that, again, training is—the quality of training takes precedent 

over the quantity of flight time. 

And I think, to answer your question in terms of military time, 

we don’t see—I certainly understand why military pilots receive 

the best training in the world, and they perform at a high and proficient level, even with limited flight time. Those pilots aren’t coming, though, into the industry. We talk about potential military pilots coming in. And, potentially, a guy who is landing a fighter on 

a carrier coming out with 300 hours is still considered unqualified 

to fly under the current statute. It is crazy. We are going to ask 

that guy to now go get another 500 hours of flight time, flying in 

a single-engine airplane in a fair weather environment, before we 

can consider him a candidate. 

There are only 24 universities that have been approved, as far 

as I know. Maybe there have been a few more added since then. 

None of them are 2-year aviation programs. So the reduction to 

1,250 hours is a farce. It doesn’t even exist. There is no way to take 

advantage of that. 

So, again, you know, we had a rulemaking process. The industry, 

including ALPA—we are on the same page on this—were simply ignored by the FAA. I would urge this subcommittee to strongly ask 

the FAA to reconsider how it implemented the rule. And I am only 

talking about the experience requirements, and not the flight and 

duty time limitations. 

So, again, I think we should be focused on quality and capability 

and proficiency. And, again, if there is an airline out there that is 

putting nonqualified—although they may be statutory qualified, 

but they are not proficient, not professional, not safe, and I think 

32 

that is what we had at Colgan Air—those airlines have no business 

being in the industry. 

Mr. GRAVES. Mr. Moak, real quick. 

Mr. MOAK. Congressman Graves, you are an accomplished pilot. 

I flew off aircraft carriers, flew fighters off aircraft carriers. We 

have the best training, some of the best training in the world, 

where they are coming out with 250 hours and are flying our young 

men and women into combat overseas. So what you focused on is 

a very good point: training, and oversight after training. 

I believe what the committee had done and what the process led 

to was a proxy for—with hours as a substitute for some training. 

As you know, before, there were people that were coming in with 

very reduced hours, getting an ATP, and going right into the right 

seat of these airlines, some at very reduced wages. That is what 

was trying to be corrected here. 

But your focus on training is spot on. I am with you on training. 

And we need to stay vigilant on training. You could have 2,000 

hours or 20,000, like you said, without proper oversight, without 

proper training. It is not a safe operation. 

Mr. GRAVES. Thank you, Mr. Chairman. 

Mr. LOBIONDO. Mr. Davis? 

Mr. DAVIS. Thank you, Mr. Chairman, and thanks to each of you 

for being here today. I would like to first start with Mr. Moak. 

Thanks again. Good to see you again. 

You proposed restored loan guarantees for college students undergoing flight training programs. This is a concept that really interests me. I have Parkland Community College in my district. And 

under the leadership of their president, Tom Ramage, a good friend 

of mine, they are going to assume control of the aviation program 

that was once at the University of Illinois. We want to continue to 

explore ways and policies that will help future pilots succeed. 

What other innovative means do you think could be employed to 

recruit students interested in becoming pilots? 

Mr. MOAK. You know, we have—Congressman, we have the same 

challenges that is confronting, you know, STEM in the United 

States. We need to stay focused on getting young men—and I want 

to emphasize women—into our profession. And the Air Line Pilots 

Association, we are partnering with universities and pushing this 

hard, but we are being very mindful of the cost of education today. 

The future is going to be on these young people going through, 

graduating, and then progressing to a job and a career. And so, 

anything that we can do in that respect, anything this committee 

can do, or the Congress can do, we are all for. 

Mr. DAVIS. Well, thank you very much. Mr. Bedford, you mentioned, just in your last response, about our military members, our 

servicemembers can fly hours upon hours, mission upon mission, 

land multimillion-dollar aircraft on aircraft carriers, and have to 

come back and get 500 more hours of certification, did you say? 

Mr. BEDFORD. It depends on how many hours, Congressman, 

they actually leave the military with. But, yes, it is possible for a 

highly proficient military pilot to leave the service with less than 

750 hours, and he would be required under statute to make up the 

difference before he would be eligible for a restricted ATP. 

Mr. DAVIS. On average, how often does that happen? 

33 

Mr. BEDFORD. I think today we are seeing very few military pilots actually coming in to the commercial airline business. 

So, one of the challenges we have is the—you know, commercial 

airline business is a seniority-based opportunity. And as a previous 

congressman had mentioned, you know, people come into the profession, looking at it as a career investment. And that career starts 

with building experience at regional carriers, and then they generally matriculate to mainline. And that is the same path that 

most military pilots would take, as well. 

Mr. DAVIS. OK. Well, I am interested. Now, you brought up a 

very interesting point that I didn’t expect and wasn’t on my prepared list of questions. I would be happy to work with you and the 

others on the panel to try to address that issue, so that our heroes 

can come back and fill this airline pilot shortage. 

Mr. Sprenger, while I have some time left, you did start to talk 

a little bit about the contract tower program. I have numerous contract towers in my district in central Illinois. And you know, you 

got into it a little bit, but can you tell me how the contract tower 

program helps you retain your air service? And also how it promotes safety? 

Mr. SPRENGER. Sure, Congressman. Without the contract tower 

program, we would not have a tower. And if we didn’t have a 

tower, our airlines would struggle to operate at our airport with 

the frequency that they currently have. We would not have grown 

to the point where we are without the contract tower program. 

When we look at—the struggles that we are at now is that the 

contract tower program isn’t built for scale. And so, as an airport 

grows larger, we are still at the scale of a much smaller airport. 

Mr. DAVIS. One more question for you, Mr. Sprenger. And I know 

you have experience with the Small Community Air Service Development Program, and coming up with your local contributions. 

From your testimony, I gather that the local buy-in is a key component to your success. And what, if any, changes would you recommend to make that program more effective for airports like you 

to use? 

Mr. SPRENGER. The key, I think, is exactly what you said, Congressman. It has to have local contribution and buy-in. If the community isn’t behind it and supportive of it, it is going to be a difficult struggle, all together. When the community does have the 

buy-in and is participating financially, they have a vested interest 

in its success. 

Mr. DAVIS. Well, thank you. And one last question. Mr. Mann, 

according to an MIT report released last year, domestic departures 

declined by more than 21 percent at small airports between 2007 

and 2012, but less than 9 percent at our large-hub airports during 

the same period. What do you think—why do you think there is 

such a large discrepancy between the large and the small airports? 

Is it just price, or what other ideas? 

Mr. MANN. It is primarily a price and the nonstop destinations, 

and the fact that it is so easy for people in our community to drive 

to the larger airports. Charlotte is, like I said, the sixth largest airport in the country. It is just over an hour drive away. And they 

are just a tough competitor. 

34 

I think our—what we need to do in the local community, though, 

is to get our costs in line and make a business case to the airlines 

to serve our market. And I can tell you our example is when we 

got more service, and got our costs in line, the airlines did bring 

capacity back, and we started seeing the customers come back to 

our airports. So, again, I think it is—for us it comes back to local 

control and having a willing airline that is willing to take a risk 

with us. 

Mr. DAVIS. Well, thank you. If I had more time, Mr. Chairman, 

I would yield back. 

Mr. LOBIONDO. Mr. Meadows? 

Mr. MEADOWS. Thank you, Mr. Chairman. Thank each of you. 

Some of you, welcome back, it is good to see you again. 

Mr. Mann, let me start with you. I had the pleasure of flying into 

your airport here just a couple of weeks ago. I have a good friend 

in Asheville who sends his regards—Lou. You—it has been talked 

about that you created competition, or allowed for some additional 

competition among carriers. One, is that the case? How did you do 

that? And how did it benefit, I guess, you know, the airport and 

the community there? 

Mr. MANN. Well, primarily, it was, again, getting our costs in 

line and then making a business case for the new air service. It 

really came down to the fact that we were not competitive. And so 

we had to go out to both airlines, after we got our costs in line. 

One of the things that we saw with Delta, and we made the business case when encouraging competition, we made the case to 

Delta that, if you are going to drive—if our customers—half our 

market drives to Charlotte. If those guys are going to drive to 

Charlotte, they are going to get on US Airways and American Airlines. And so, Delta, you are going to lose all those customers. 

And so, we were able to quantify what that loss would be. And 

if they, again, just added a little bit of capacity at a fairly competitive price, that they would pick up that market share and fill the 

planes up. They agreed to do so. And they are running about an 

84-, 85-percent load factor on market. But again, it was making a 

business case with Delta Airlines primarily that said if you bring 

the aircraft here you can make money in our market. And they— 

again, to date they are very happy with what they are doing in our 

market. 

And again, it has not hurt US Airways in Charlotte. I mean 

those folks were on the road, and now they have an option to fly 

out of the local community. And, again, that is a win-win for economic development, the folks that don’t have to spend that 11⁄2

hours on the road. And, again, the airline can still make money in 

our market. 

So I really think it comes down to making a business case. And, 

again, Delta had not really thought about the fact that they were 

going to lose—that they were just losing market share by not adding—we are talking 100 seats a day. Very simple to fill that up, 

when you have 500,000 people driving up the road. 

Mr. MEADOWS. All right. So let me go on in terms of the competitiveness, and let’s talk a little bit about unfunded mandates and 

about compliance costs and what happens, because it seems like 

there is a plethora of compliance issues that come up, and they exVerDate Aug 31 2005 12:17 Jan 05, 2017 Jkt 000000 PO 00000 Frm 00044 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\4-30-1~1\87701.TXT JEAN
35 

pect both you, Mr. Sprenger, and you, Mr. Mann, to figure out 

ways to implement those. And that would go at the expense of 

operational expenditures and capital expenditures to meet those 

compliance things. 

How do we best deal with that, and how do we control that, in 

terms of those additional unfunded mandates that have been 

placed on small and rural airports? 

Mr. MANN. The most recent challenge we had was the—with the 

TSA wanting to get out of the exit lane business. That was going 

to be a significant hit to our bottom line. And we had already put 

technology in place to handle that. And so it was an issue out there 

where, if they would have just accepted the technology for that exit 

lane, it wouldn’t have—it was an unfunded mandate, potentially, 

but we couldn’t get TSA to accept the technology. 

So I think airports are trying to be creative, we are trying to do 

smart things out there, and our regulatory bodies are putting up 

road blocks for us. And my point is we have enough challenges 

that, when we find solutions, we need partners in the FAA and the 

TSA to work with us and say, yes, we think that can work. Make 

it a pilot program, if you need to, but that is really where we need 

to go. 

The other part is the regulations on airport revenue, parking lot 

revenue. We ought to be—we ought to have the flexibility to use 

that local revenue to do what we think is in the best interest of 

our local economy. 

Mr. MEADOWS. So the revenue use policy to have greater flexibility there, in terms of how to implement that. 

Mr. MANN. That is—that would be key. Also, the land use. But, 

yes, the revenue use policy really is antiquated. It needs to be 

modified. And, again, let us in the community do what is best with 

our airline partners and our community to grow the business. 

Mr. MEADOWS. So what you are saying is that you came up with 

a few options with regards to TSA that would not sacrifice safety, 

and could have been a more cost-efficient way to implement it, and 

yet you couldn’t get a sign-off from TSA to do that. 

Mr. MANN. That is correct. 

Mr. MEADOWS. So how often does that occur? 

Mr. MANN. Well—— 

Mr. MEADOWS. Not specifically just with TSA, but with any Federal agency. 

Mr. MANN. It happens all the time. I mean with our revenue use 

policy, I mean, daily. If we wanted to do an airline incentive right 

now, which we did not need to do in Columbia, but if we wanted 

to, we could not have used our money to partner with a specific 

route, a specific airline. There is just complications that are there 

that, again, prohibit us from being more successful than what we 

would be. 

Mr. MEADOWS. All right. Thank you, Mr. Chairman. 

Mr. DAVIS [presiding]. Thank you. I would like to recognize Mr. 

Larsen for 5 minutes. 

Mr. LARSEN. Dr. Dillingham, what would you see as a key contributing factor to the growth in the total—I mean per passenger— 

EAS subsidies, as a result of your report? 

36 

Dr. DILLINGHAM. Mr. Larsen, I think that the fact that they 

are—the increased number of communities that are a part of EAS, 

that certainly is a major factor. The other factor is something that 

the other panel has mentioned, in terms of the price of fuel has 

quadrupled over the last several years, which also contributes to 

the subsidy cost, as well. So those two factors are the key factors 

that contribute to the increase in cost. 

Mr. LARSEN. Would the fuel be more of a contributor to the perpassenger than—— 

Dr. DILLINGHAM. Yes, sir. 

Mr. LARSEN [continuing]. The EAS subsidy? Yes, OK. Yes, sure, 

Secretary Kurland. 

Ms. KURLAND. Thank you, Congressman. There are two other 

factors that I would like to mention. We have seen, in the past few 

years, a number of EAS carriers have gone out of business. So the 

pool has become smaller, in terms of the available carriers. We are 

also seeing a lot of the equipment, the 19- to 34-seat aircraft, which 

were the right-sized aircraft for these communities, aging and 

being retired. And so, finding the types of aircraft that are going 

to work has posed challenges, as well, and additional expense. 

Mr. LARSEN. So, on that point, what is the challenge in finding 

the right-sized aircraft at this point? 

Ms. KURLAND. Well, the manufacturers are not making the 19- 

to 34-seaters. So what we are seeing—and Congress did change 

some of the requirements to allow nine-seaters—in many of the 

communities with the shorter haul flights is that the nine-seaters 

are working well. In other, larger communities, 50-seat RJs are 

working. But they are more expensive to run, as well. So, we don’t 

necessarily have the sweet spot at this point for the type of aircraft. 

Mr. LARSEN. All right. So I have one more question for Secretary 

Kurland. It is—this issue was brought up earlier, but—and unrelated to rural service, but it has to do with the NAI application. 

Can you tell the subcommittee where DOT is in the process on the 

NAI application? 

Ms. KURLAND. Congressman, as you know, it is a contested proceeding. And so I am not at liberty to comment on it. 

Mr. LARSEN. Thank you. Thank you. 

Mr. DAVIS. Thank you, Mr. Larsen. A couple more questions for 

the panel that I wasn’t able to get to during my time period, and 

I would like to start with Secretary Kurland. I will remind you I 

do not have any other committee action going on that I am going 

to ask you about today, like last time. 

So I just want to actually get your opinion. I mentioned in the 

SCASDP program we had a little—somewhat of a discussion earlier 

during my questioning. I appreciated your responses. But, Secretary Kurland, can you tell me how important is community involvement for this program, and can you give me some ideas of how 

airports can effectively work with IDOT or work with USDOT even 

more so to make it easier for you to make a determination? 

Ms. KURLAND. Thank you, Congressman, and I appreciate your 

comments. 

Regarding the SCASDP program, both of our airport managers— 

and I compliment them on the great work they have done at their 

37 

airports—have mentioned the importance of community involvement. And we have seen that many of the successful programs 

have had community involvement. And we view that as a very high 

priority, where communities are putting skin in the game, because 

that means that they are going to support the service. If it is a revenue guarantee, they are going to use the service. So that type of 

support is critical. 

One of the other things that we have learned from some of the 

other reports and—that, you know, the GAO, the IG has done, and 

that we have taken a look at ourselves—is the importance before, 

for example, the implementation of a revenue guarantee, that a 

feasibility study be done so that the airport, as much as possible, 

sets themselves up for success. 

And so, we think that those types of things are important. We 

have also recently, in our recent RFPs, put in an opportunity for 

intermodal funding, to the extent that a community was interested 

in looking at that, as well. 

So I would like to commend Congress in the funding of the 

SCASDP program, in viewing it as a laboratory, in giving these 

communities these airports an opportunity to try new and different 

things. But community support is really critical. 

Mr. DAVIS. Great, thank you. Dr. Dillingham, do you have anything to add? 

Dr. DILLINGHAM. Yes. Just a footnote to that is that DOT is 

maintaining a database of lessons learned from the Small Community Air Service Development Program which has benefitted communities that are thinking about these innovative approaches, 

what works, why it works, and what they need to do to be more 

successful. So we think that is a good thing for improving the effectiveness of the Small Community Air Service Development Program. 

Mr. DAVIS. Great. Does anybody else on the panel have any other 

comments they would like to make on the Small Community Air 

Service Development Program? 

Mr. BEDFORD. Well, just from my own experience, Congressman 

Davis, committee involvement is essential, and communities should 

have skin in the game, economic skin in the game, in order to 

make sure that they are doing everything that they can to support 

unique air carriers services. 

I agree with everything that Secretary Kurland said with the 

challenges of finding the right aircraft. I think you referred to it 

as the sweet spot, something that, you know, frankly, passengers 

want cabin-class service, you know. And, like it or not, there is a 

certain turbo-prop avoidance factor. 

One thing that hasn’t been mentioned here today that I think I 

should at least put on the table is just airport crowding in general. 

What these services need is connectivity to the Nation’s transportation network. There is rarely enough traffic, you know, from 

small town community to small town community. So being able to 

make connections in large hubs is essential for the service to be 

successful, which means small communities need to partner with 

major airlines. 

The pushback you get is a small airplane consumes the same 

amount of airspace as a wide-body. So, you know, you are comVerDate Aug 31 2005 12:17 Jan 05, 2017 Jkt 000000 PO 00000 Frm 00047 Fmt 6633 Sfmt 6633 P:\HEARINGS\113\AV\4-30-1~1\87701.TXT JEAN
38 

peting for scarce resources in places like Atlanta and Chicago and 

New York and Philadelphia, you know, San Francisco, L.A. And 

that is a huge problem, I think—well, one of many that face the 

retention of these vital airlines in smaller communities. 

Mr. DAVIS. Right. Well, the hearing is about to end. Does anybody on the panel have any issues you would like to discuss that 

we might not have gotten to? Now is your time to go ahead and 

do that. 

[No response.] 

Mr. BEDFORD. Did I mention a pilot shortage? 

[Laughter.] 

Mr. DAVIS. Going once, going twice—if there are no further questions, I thank the witnesses for their testimony and the Members 

for their participation. This subcommittee stands adjourned. 

[Whereupon, at 11:41 a.m., the subcommittee was adjourned.] 

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