Order: 2012

- 8

- 8

Served: August 3



## , 2012



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 3 rd day of August , 20 1 2

Essential Air Service at

LARAMIE, WYOMING WORLAND, WYOMING DOCKET DOT

- OST

- 1997

- 2958

DOCKET DOT

- OST

- 1997

- 2981

under 49 U.S.C. 41731 et seq.



### ORDER SELECTING AIR CARRIER S

Summary By th is Order, the Department is making Essential Air Service (EAS) air carrier selections at Laramie and Worland, Wyoming

. At Laramie, SkyWest Airlines, Inc., operating as United Express (SkyWest), will provide 14 weekly nonstop round trips to De nver International Airport (Denver) using 30

- passenger Embraer EMB

- 120 aircraft for an annual subsidy of $1,635,346

.

In addition, we are re

- selecting Great Lakes Aviation, Ltd., operating as both a United

Airlines and Frontier Airlines code

- share (Great L akes) , at Worland to provi de 12 weekly

one

- stop round trips using 19

- passenger Beechcraft 1900 aircraft for an annual subsidy of $1,987,148

. 1

1 Suc h subsidy is calculated and distributed on a fiscal year basis, subject to the availability of appropriated

funds.- 2

-

Background By Order 2010

- 8

- 10, August 18, 2010, the Department selected Great Lakes to provide EAS at Laramie and Worland using 19

- passenger Beechcraft 1900 aircraft to Denver. Laramie receives 19 weekly nonstop round trips for an annual subsidy of $1,181,572, and

W orland receives 12 weekly one

- stop round trips over a Worland

- Cheyenne

- Denver or

Worland

- Laramie

- Denver routing for an annual subsidy of $1,770,336.

As the end of the contract s were appro aching, we issued Order 2012

- 4

- 31, April 26, 2012

, requesting proposals from air carriers interested in p roviding EAS at the communities for a new term beginning October 1, 2012. In respo nse to that Order, we received proposal s from Great Lakes and SkyWest

.

Both air carriers’ complete proposal s and the communities’ comments may be accessed

online at http://www.regulations.gov/ by entering each community’s Docket num ber in the search block: Laramie, Docket DOT

- OST

- 1997

- 2958, and Worland, Docket DOT

- OST

1997

- 298 1

.

Proposal of Great Lakes Great Lakes proposed one option each for Laramie and Worland to be considered on a

stand

- alone basis. At Laramie, the airline proposed status

- quo service of three weekday and weekend (18 a week) nonstop round trips to Denver using 19

- passenger Beechcraft 1900 aircraft for an annual subsidy of $1,536,014. At Worland, the airline proposed two weekday and two weekend (12 a week) one

- stop r ound trips over a Worland

- Cheyenne

Denver or Worland

- Riverton

- Denver or Worland

- Laramie

- Denver routing using 19

- passenger Beechcraft 1900 aircraft for an annual subsidy of $1,987,148. All flights will operate under a code

- share agreement with United Airli nes and Frontier Airlines

.

Proposal of SkyWest SkyWest submitted a proposal for service only from Laramie. It proposed two daily nonstop round trips (14 a week) to Denver using 30

- passenger Embraer EMB

- 120 aircraft for an annual subsidy of $1,635,346. The flight s will operate under a code share with

United Airlines and will operate as United Express.

Community Comments

On June 6, 2012, we requested from both communities comments regarding this EAS

selection case. In response

, we received three official letters from Laramie. In a letter from the Laramie Regional Airport Board, the members state their strong support for SkyWest, adding “We are certain that SkyWest provides us with the only marketing opportunity to increase boar dings to a level that would no longer require an EAS subsidy.” City Manager Janine Jordan emphasized in her letter Laramie’s need for high quality, reliable air service, and because of this need, the community believes that SkyWest is the airline “best po sitioned to provide the timely and consistent service our citizens require.” We also heard from Mr. Tim Sullivan, Chairman of Albany County Board of Commissioners, who reiterated the community’s support for SkyWest.- 3

-

We received no official comments f rom Worland, other than an e

- mail from Mr. Gary Thompson, Airport Manager at Worland Municipal Airport, stating “ With Great Lakes as the only bidder for the Worland market, we have no comments at this time. ”

Decision After carefully reviewing each air carrier’s proposal, we have decided to select SkyWest at

Laramie and r e

- select Great Lakes at Worland. We find the subsidy and service levels

reasonable and will meet both communities’ needs.

At Laramie we were faced with a choice between SkyWest and Gre at Lakes, and all feedback we received from the community supported SkyWest’s proposal. In addition, SkyWest has provided reliable EAS at a number of communities for several years and we are confident that SkyWest will not only meet the air service needs of the community but

also enhance it s existing air service . SkyWest’s service to Denver operating as United Express will provide the community with the seamless service to the national air transportation system. With respect to Worland, the decision to r e

- select Great Lakes is straightforward, given that Great Lakes is the only bidder and we received no ob jections from the community. Furthermore, Great Lakes’ operating with both the United Airlines

and Frontier Airlines code to Denver will continue to pr ovide the community’s excellent connections to the national air transportation system.

We shall make this selection of SkyWest at Laramie and re

- selection of Great Lakes contingent upon the Department’s receiving properly executed certifications from the carrier that it is in compliance with the Department’s regu lations regarding drug

- free workplaces and nondiscrimination, as well as the regulations concerning lobbying

activities. 2

S ervice Transition We expect Great Lakes and SkyWest to work together to make a smooth transition at

Laramie . In that regard, before Great Lakes suspends it s service they must notif y any passengers holding reservations for travel after the suspension date, to assist those passengers in making alternate air transpor t ation arrangements, or to provide a refun d of the ticket price, without penalty, if requested.

Great Lakes’ current EAS contract at Laramie expires on September 30, 2012 , and SkyWest may not start full EAS by then. In that event, c onsistent with established program policy, we typical ly use an air carrier’ s prospective proposal that was submitted during the competitive bid process to establish a bridge rate until the new air carrier inaugurates

servi ce. After reviewing Great Lakes’ proposed r ate for Laramie , we find that it appears reasonable for the proposed service levels. We will therefore establish it as the final rate

for the air carrier’ s service at Laramie for the period from October 1, 2012 , until SkyWest inaugurates full EAS.

2 The certifications are available on the Web at http://ostpxweb.dot.gov/aviatio n/index.html

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-

Carrier Fitness

49 U.S.C. 41737(b) and 41738 require that we find an air carrier fit, willing, and able to provide reliable service before we may subsidize it to provide E AS

. Great Lakes and SkyWest are subj ect to the Department’s continuing fitness requi rements, and no

information has come to our attention tha t would cause us to questio n the carrier s ’ fitness at this time. We have contacted the Federal Aviation Administration, and it has raised no concerns that would negatively affect our fitness finding s . We therefore conclude that the

carrier s are reliable and remain fit to conduct the operations proposed here.

This Order is issued under authority delegated in 49 CFR 1.56a(f).

ACCORDINGLY,

1. We select SkyWest Airlines, operating as United Express, to provide Essential Air

S ervice at Laramie, Wyoming , and establish an annual subsidy rate as described in Appendix C;

2. We re

- select Great Lakes Aviation, Ltd. to provide Essential Air Service at Worland, Wyoming, and establish an annual subsidy rate as described in Appendix C

3

. We direct both Great Lakes Aviation, Ltd., and SkyWest Airlines to retain all books, records, and other source and summary documentation to support claims for payment, and to preserve and maintain such documentation in a manner that readily permits its audit and examination by representatives of the Department. Such d ocumentation shall be retained for seven years from the service date of this Order or until the Department indicates that the records may be destroyed, whichever comes first. Copies of flight logs for aircraft sold or disposed of must be retained. The ca rrier may forfeit its compensation for any claim that is not supported under the terms of this Order ;- 5

-

4 . We f i nd that both Great Lakes Aviation, Ltd. and SkyWest Airlines continue to be fit, willing and able to operate as commuter and certificated carr ie r s
, respectively, and capable of providing reliable Essential Air S ervice at Laramie and Worland, Wyoming ;

5

. These docket s will remain open pending further Department action ; and

6 . We will serve copies of this Order on the Mayor s and Airport Managers of Laramie and Worland, Wyoming

, Wyoming Department of Transportation

, Great Lakes Aviation, Ltd. and SkyWest Airlines

.

B y:

SUSAN L. KURLAND Assistant Secretary for

Aviation and International Affairs

(SEAL)

An electronic version of this document is ava ilable at http://www.regulations.govAppendix A



## AREA MAP

Maps generated by the Great Circle Mapper

- copyright © Karl L. Swartz

.Appendix B Page 1 of 2

Laramie

– SkyWest ProposalAppendix B Page 2 of 2

Worland Great Lakes ProposalAppendix C Page 1 of 2

SkyWest Airlines

Essential Air Service to be Provided at Laramie, Wyoming

Effective Period : October 1, 2012 through September 30, 2014

Scheduled Service : 14 weekly round trips to Denver

Aircraft : 30

- passenger Embraer EMB

- 120 Rate per Eligible Flight: $ 1, 146 1
Weekly Ceiling for each community : $ 32,088 2

Note: The carrier understands that it may forfeit its compensation for any flights tha t it does not operate in conformance with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significan t elements of the required service, without prior approval. The carrier understands that an a ircraft take

- off and landing at its scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight that has not been completed, such as certain weather cancellations, only completed flights are consi dered eligible for subsidy. In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant per iod, it may jeopardize its entire subsidy claim for the period in question. If the carrier contemplat es any such changes beyond the scope of the Order during the applicable period of this rate, it must first notify the Office of Aviation Analysis in writing and receive written approval from the Department to be ensured of full compensation. Should circum stances warrant, the Department may locate and select a replacement carrier to provide service on these routes. The carrier must complete all flights that can be safely operated; flights that overfly points for lack of traffic will not be compensated. I n determining whether subsidy payment for a deviating flight should be adjusted or disallowed, the Department will consider the extent to which the goals of the program are met and the extent of access to the national air transportation system provided to t he community.

If the Department unilaterally, either partially or completely, terminates or reduces payments for service or changes service requirements at a specific location provided for under this Order, then, at the end of the period for which the dep artment does make payments in the stipulated service levels, the carrier may cease to provide service to that specific location without regards to any requirement for notice of such cessation. Those adjustments in the levels of subsidy and/or service that are mutually agreed to in writing by the Department and carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract are subject to, and incorporate by reference, relevant statutes and Department regulations, as they m ay be amended from time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds are not currently available for performance under this Order beyond September 30, 2012. The Go vernment’s obligation for performance under this Order beyond September 30, 2012, is subject to the availability of appropriated funds from which payment for services can be made. No legal liability on the part of the Government for any payment may arise for performance under this Order beyond September 30, 2012, until funds are made available to the Department for performance. If funds are not made available for performance beyond September 30, 2012, the Department will provide notice in writing to the c arrier.

All claims for payment must be submitted within 60 days of the last day of service provided under this Order.

1 Annual compensation of $1,635,346 divided by 1,427 annual departures (28 weekly departures x 52 weeks x 98 percent completion)

. 2 28 arrivals and departures per week multiplied by $1,146 per flight

.Appendix C Page 2 of 2

Great Lakes Aviation, Ltd.

Essential Air Service to be Provided at Worland, Wyoming

Effective Period : October 1, 2012 through September 30, 2014

Scheduled Service : 12 weekly one

- stop round trips to Denver

Aircraft : 19

- passenger Beechcraft 1900 Rate per Eligible Flight: $ 1,625 1
Weekly Ceiling for each community : $ 39,000 2

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significan t
elements of the required service, without prior approval. The carrier understands that an aircraft take

- off and landing at its scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight that

has not been co mpleted, such as certain weather cancellations, only completed flights are considered eligible for subsidy. In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant per iod, it may jeopardize its entire subsidy claim for the period in question. If the carrier contemplates any such changes beyond the scope of the Order during the applicable period of this rate, it must first notify the Office of Aviation Analysis in writing and receive written approval from the Department to be ensured of full compensation. Should circumstances warrant, the Department may locate and select a replacement carrier to provide service on these routes. The carrier must complete all flights that can be safely operat ed; flights that overfly points for lack of traffic will not be compensated. In determining whether subsidy payment for a deviating flight should be adjusted or disallowed, the Department will consider the extent to which the goals of the program are met and the extent of access to the national air transportation system provided to the community.

If the Department unilaterally, either partially or completely, terminates or reduces payments for service or changes service requirements at a specific location provided for under this Order, then, at the end of the period for which the department does make payments in the stipulated service levels, the carrier may cease to provide service to that specific location without regards to any requirement for notice of such cessation. Those adjustments in the levels of subsidy and/or service that are mutually agreed to in writing by the Department and carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract are subject to, and i ncorporate by reference, relevant statutes and Department regulations, as they may be amended from time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds are not currently available for performance under this Order beyond September 30, 2012. The Government’s obligation for performance under this Order beyond September 30, 2012, is subject to the availability of appropriated funds from which payment for services ca n be made. No legal liability on the part of the Government for any payment may arise for performance under this Order beyond September 30, 2012, until funds are made available to the Department for performance. If funds are not made available for perfor mance beyond September 30, 2012, the Department will provide notice in writing to the carrier.

All claims for payment must be submitted within 60 days of the last day of service provided under this Order.

1 Annual compensation of $1,987,148 divided by 1,223 annual departures (24 weekly departures x 52 weeks x 98 percent completion)

. 2 24 arrivals and departures per week multiplied by $1,625 per flight

.