PROPOSAL UNDER THE SMALL 

COMMUNITY AIR SERVICE DEVELOPMENT PROGRAM Docket DOT-OST-2010-0124Gulfport-Biloxi Regional Airport AuthorityDUNS – 088924246Congressional District Code – MS 05
Table of Contents

• Contact Information• Executive Summary• MS Gulf Coast Economy• Air Service Development• Evaluation Criteria• Project Proposals and Costs• Community Assurances• Acknowledgements
Gulfport-Biloxi International Airpo

14035 – L Airport Road

Gulfport, MS 39503

Bruce Frallic, A.A.E.

Executive Director

Phone: (228) 863-5951Fax: (228) 863-5953

bfrallic@flygpt.com
EXECUTIVE SUMMARY

• The economic condition of the MS Gulf Coast has yet to recover from 

effects of Hurricane Katrina in August 2005. The April 2010 BP Oil Spill in Thdelivered a second blow, adversely effecting the economy on the MS Gulf Cshort and long term. 

• As a result of the relentless national and regional media coverage, pa

business and industry perceptions in all air markets have been, and will adversely impacted. 

• The $1.6 billion tourism industry on the Mississippi Gulf Coast, which 

over 25,000 people, has been impacted as a result of the oil spill. 

• In an effort to prevent or mitigate a major decline in passenger traffic, an

must effectively and quickly define market changes resulting from the oil assess the impact of the disaster, and formulate solutions to the problems p

• With funds made available through the Small Community Air Servi

Program, GPT plans to conduct a series of strategic studies from which compose an action plan. This plan will help identify appropriate marketing eessential to prevent a catastrophic economic loss.

• Gulfport – Biloxi International Airport has the support of a citizen-base

partnership that is dedicated to sustaining air service levels in their commun
MS GULF COAST ECONOM
MS GULF COAST ECONOMY

BP OIL SPILL IMPACT

The oil spill resulting from the explosion of the Deepwater Horizon drilling rig British Petroleum (BP) – has left a lasting adverse effect. 

• At this juncture, it is unknowspill will ultimately impact the know that leading up to the evthe event unraveled, the econGulf Coast was making real prorecovery.• Job sectors connected to the industry face immediate and s• Negative national perceptioinundated beaches have and wadversely effect the MS Gulf CIndustry.

GPT
MS GULF COAST ECONOMY

ESTABLISHMENT JOBS

Source: Gulf Coast Business Council
MS GULF COAST ECONOMY

SALES TAX COLLECTIONS

Two preliminary observations about oil spill impacts in May 2010.1. Though it is generally agreed that tourism related visitation on the Miss

Coast is down because of the oil spill, the number of people in the regiothe oil spill has likely grown overall hotel sales when compared to prev(Chart 3).

2. Prevailing trends for restaurants on the Mississippi Gulf Coast have wor

were actually down in May after increasing leading up to the oil spill (C

Source: Gulf Coast Business Council
MS GULF COAST ECONOMY

TOURISM

Looking ahead, and taking into consideration ongoing impacts of the oil spfollowing will influence the progress of the Mississippi Gulf Coast in its effestablish itself as a premier travel destination.• Perceptions of potential visitors on how the oil spill has impacted the r

continue to be a challenge. Though short term aggregate impacts have no

substantial, it is likely that BP related travelers have offset otherwise lost bMany outward indicators, such as inquiries for golf packages and advance bookings, are down. Additional marketing campaigns will be needed to a

negatively impacted perceptions.• GPT Air Service is directly impacted by declines in leisure visitors. Inboufrom ATL, TPA, and other key markets is a critical revenue source. 
AIR SERVICE DEVELOPMEN
AIR SERVICE DEVELOPMENT

AIRLINE MEETINGS

2005

 Continental Airlines Northwest Airlines Delta Airlines American Eagle

2006

 Delta Airlines US Airways American Eagle Airtran Airways

2007

 Continental Airlines Frontier Airlines Delta Airlines American Eagle Skybus Allegiant Air United Airlines US Airways

2008

 Delta Airlines US Airways United Airlines Airtran Airways

2009

 Co De AmUnit Alle

2010

 Co De Sp US  Bra Vis Un

Airport officials continue to meet with new and existing air carriers in an efadditional service. 
AIR SERVICE DEVELOPMENT

PUBLIC / PRIVATE PARTNERSHIPS

Airport officials target demand for new air service through public / private 
AIR SERVICE DEVELOPMENT

AGGRESSIVE INCENTIVES

GPT offers incentives to help lower risks with the intention of creating an eaggressive support to grow existing routes and secure new routes.

• Consolidated seat block programs and cooperative marketing with area caand attractions.

• AirTran Airways – (Jan 2010) secured service to ATL / TPA through co

casino seat block agreement.• Branson Air Express – (May 2010) secured nonstop service to Bransoncasino marketing support and seat commitment with private entity.

• GPT aggressively markets air service to area businesses.• GPT provides airlines with short term abatement of airport fees – 12 montfor new destinations.• Aggressive marketing support in local area and in destination markets is pcarriers, not limited to new service.• Awarded Small Community Air Service Grant (2005) for revenue guarantee service to ORD with American Eagle in 2007- 08. 
AIR SERVICE DEVELOPMENT

SCASG 2005

Small Community Air Service Grant awarded on September 6, 2005.

• Grant funds awarded in the amount of $750,000

• $700,000 – Revenue Guarantee • $50,000 – Marketing / Promo / Market Assessment

• American Eagle began nonstop service from GPT – ORD on December 13, • The revenue guarantee funds were depleted on April 2008. Due to increacosts associated with a significant increase in fuel costs, AE discontinued the service on November 2008. 
AIR SERVICE DEVELOPMENT

2005 SCASG vs. 2010 SCASG

The 2010 SCASG application definitively reflects a new project as the goals aare considerably different in comparison to the 2005 SCASG awarded. 2005 SCASG AWARD TOTAL $750,000REVENUE GUARANTEE - $700,000MKTG / PROMO / ASSESSMENT - $50,000FEDERAL AMOUNT- $750,0002010 SCASG PROPOSAL TOTAL $455,000ECONOMIC IMPACT / ACTION PLAN - $30,000AIR SERVICE DEVELOPMENT CONSULTANT- $30,000MARKETING SUPPORT - $395,000FEDERAL AMOUNT- $280,000
EVALUATION CRITERIA
EVALUATION CRITERIA

CATCHMENT AREA

DRIVE T• 1 HOU• .5 HOU
EVALUATION CRITERIA

CURRENT SERVICE – AUG 2010
EVALUATION CRITERIA

CURRENT SCHEDULE – SEP 2010

TOTAL 22 21 24 22 23 22 22 156 9,274 

FL GPT TPA 428 Aug-10 0 0 1 0 1 0 1 3 351 

DL GPT MEM 324 Aug-10 3 3 3 3 3 3 3 21 1,050 

CO GPT IAH 376 Aug-10 5 5 5 5 5 4 4 33 1,650 

AA GPT DFW 499 Aug-10 4 4 4 4 4 4 4 28 1,400 

US GPT CLT 577 Aug-10 3 3 3 3 3 3 3 21 1,270 

1X GPT BKG 485 Aug-10 1 0 1 0 0 1 0 3 150 

FL GPT ATL 352 Aug-10 0 0 1 0 1 0 1 3 351 

DL GPT ATL 352 Aug-10 6 6 6 7 6 7 6 44 3,052 

Al Org Dst Miles Date M T W T F Sat Sun Deps Seats 
EVALUATION CRITERIA

4 3 0 , 3 10

12 , 0 5 5

3 7 6 , 4 8 6

8 , 13 9

3 9 8 , 3 18

4 , 5 8 7

4 5 2 , 16 1

5 , 7 0 5

4 7 2 , 5 6 3

15 , 4 7 0

3 4 1, 4 9 7

4 6 , 2 3 0

2004 2005 2006 2007 2008 2009

ENPLANEMENT PASSENGER TREND
EVALUATION CRITERIA

Rank Market Nonstop Miles PAX PDEW REV PDEW Avg Fare Nonstop

1 ATL 352 79 9,786 $ 124 $ Y2 IAH 376 41 4,856 $ 118 $ Y3 DCA 898 30 4,814 $ 160 $ N4 BWI 927 29 3,840 $ 134 $ N5 LAS 1,555 24 3,859 $ 160 $ N6 LGA 1,112 22 2,871 $ 128 $ N7 PHL 1,017 20 3,048 $ 153 $ N8 TPA 429 20 2,652 $ 136 $ Y9 DFW 500 19 3,458 $ 181 $ Y

10 SAN 1,661 18 3,707 $ 201 $ N

11 LAX 1,731 17 3,720 $ 219 $ N

12 FLL 620 16 2,301 $ 147 $ N

13 ORD 800 15 2,417 $ 157 $ N

14 CLT 578 15 2,469 $ 166 $ Y

15 JAX 441 15 2,245 $ 152 $ N

16 MCO 486 15 2,326 $ 159 $ N

17 MSP 1,024 14 2,511 $ 177 $ N

18 ORF 865 14 4,076 $ 289 $ N

19 BOS 1,297 14 2,242 $ 163 $ N

20 RDU 705 13 1,756 $ 133 $ N

21 PHX 1,361 13 2,092 $ 161 $ N

22 SFO 1,964 12 2,136 $ 174 $ N

23 DTW 874 12 2,208 $ 181 $ N

24 SEA 2,117 12 2,827 $ 233 $ N

25 DEN 1,095 12 2,058 $ 172 $ N

Source: U.S. DOT, Origin Destination Passenger Survey, via Data Base Products, Inc.

GPT TOP O&D AIRPORT MARKETS – CY 2009
EVALUATION CRITERIA

GPT TOP O&D PASSENGER MARKETS – Q1 2010

Source: U.S. DOT, Origin Destination Passenger Survey.

Rank Market PAX PDEW Avg Fare Nonstop

1 ATL 50 142 $ Y2 TPA 39 68 $ Y3 DCA 25 152 $ N4 BWI 23 152 $ N5 IAH 22 219 $ Y6 LAS 22 179 $ N7 LGA 22 134 $ N8 DFW 21 189 $ Y9 PHL 18 165 $ N

10 SAN 17 230 $ N11 CLT 16 167 $ Y12 MSP 16 169 $ N13 BOS 15 168 $ N14 MCO 15 182 $ N15 ORF 14 235 $ N16 DTW 14 165 $ N17 LAX 13 258 $ N18 SAT 13 204 $ N19 ORD 13 175 $ N20 FLL 11 189 $ N21 DEN 11 189 $ N22 MCI 11 157 $ N23 SEA 10 273 $ N24 SFO 10 194 $ N25 PHX 10 165 $ N
EVALUATION CRITERIA

ANNUAL CAPACITY

-

10,00020,00030,00040,00050,00060,00070,000

1 2 3 4 5 6 7 8 9 10 1
PROJECT PROPOSAL
PROJECT PROPOSAL

To ensure effective mitigation of the negative impacts on air service levels at Biloxi International Airport as a direct result of the BP Gulf Oil Spill catastropproposal identifies the following vital support initiatives.• Employ a consultant to conduct a detailed market assessment to define coto the changing economic conditions, passenger propensities, performance aviable markets in the post-BP disaster environment. The study will ultimatelaction plan which will guide a proactive program to mitigate negative revenudirectly relates to air service. • Employ a consultant to provide expertise and support in communicating athe information to new and existing air carriers.• Through the action plan derived from the market assessment, the establisfunding of a strategic marketing campaign to implement countermeasure mtarget markets will act as the vehicle to offset the negative effects on air servthe MS Gulf Coast due to the BP oil spill. 

OBJECTIVES
PROJECT PROPOSAL

Consultant ServicesMarket Assessment Study / Strategic Plan Air Service Development Support Agreement $ 30,000 Ad Campaign 

Deliverables GPT Contribution Community Investment 

Print $ 50,000 $ 25,000 Radio $ 10,000 $ 25,000 Internet $ 10,000 Other Media – In airport advertising $ 25,000Total $ 125,000 $ 50,000 

FUND ALLLOCATION
PROJECT PROPOSAL

REGIONAL SUPPORT FOR AIR SERVICE

To ensure the success of air service initiatives, Gulfport-Biloxi and the Missisarea businesses through a public / private partnership are working together initiatives to counteract the negative effects of the BP Oil Spill.• The public / private partnership includes the Gulf Coast Business Council, Tourism Commission, The Gulf Coast Chamber of Commerce, Mississippi DevAuthority, and Gulf Coast Casino Operators.• Through the Gulf Coast Business Council and the Gulf Coast Chamber of Coservice task force, valuable information derived from economic data will be formulate the action plan. Financial support through marketing efforts will timplemented to counteract the negative impacts of the BP Oil Spill. • Together, their support of committing financial resources allows GPT to suservice and help attract new air service. 
PROJECT PROPOSAL

CRITICAL MILESTONES

• The Gulfport-Biloxi International Airport proposes its Small Community Air Development Program be evaluated based on the following milestones.

• At a minimum, maintaining existing air service levels to key leisure maATL, and TPA.• 10% - 15% increase in passenger enplanements over three years

• The airport, as the sponsor of this grant application, will be responsible for administration of this program.• The Gulfport-Biloxi International Airport will provide quarterly reports to Uregarding the progress of our ACTION PLAN as well as an accounting of fundof our objectives.• The airport will also advise U.S. D.O.T. as the objectives of the program are The effectiveness of the grant proposal objectives will be gauged through clomonitoring existing air service levels and ultimately through improvements ivolume and service levels. 
PROJECT PROPOSAL

CONCLUSIONS

• GPT’s proposal will result in: maintaining passenger levels for the airport, development and potentially air service growth, resulting in millions of dollaimpact for the Mississippi Gulf Coast.• It is vital that GPT take the necessary steps to study the short and long terservice levels as a direct result of the BP Oil Spill. We must understand, act, monitor the econometric indicators in an effort to mitigate loss. • Through an aggressive marketing initiative, GPT will have the tools needed the negative impacts on the local economy and air service.• Airlines require low risk opportunities in these economically uncertain timvolatility of our market has been increased significantly by the impacts of the • By empowering and utilizing regional support to help off-set risk, the SmaService Grant will support the investment through enhanced / expanded maadvertising. 
COMMUNITY ASSURANCES

Assurances that the grant money would be spent in accordance with the grant program stipul

proposal outline would be in the form of an independent annual audit, transaction recording s

functional oversight of transactions by Airport Authority Staff, reporting to elected and appoin

(not on the Authority staff), and a contractual obligation that designates proper use and expecof the marketing efforts.Since the primary partners for the airport are municipalities, the reporting and audit requirem

stringent. An annual audit is required to be performed by an outside audit firm. The airport t

subject to all sampling, testing, and audit standards applied by that audit firm to ensure that tfairly and materially states the financial condition of the entity. All transactions are recorded Accepted Accounting Principles (GAAP) as established by the Governmental Accounting StandCompliance testing is performed to ensure that grant funds (considered restricted) are being udesignated by the awarding entity. The Finance Department has an Accountant specifically assigned to monitoring grants and rep

status quarterly. The Executive Director is responsible for approving all transactions on a day-

and reviewing the expenditures and performance measurement results. Monthly financial repdelivered to the elected officials (Airport Board) and the Airport Steering Committee (advisory the operations of the airport). These reports are available for public review.A contract for marketing services will be written to include performance standards. These staintended to ensure that the grant money (should we be granted the opportunity) would be sp

consistent with the requirements of this program and our proposal.The Airport Authority is traditionally very successful with monitoring grant programs, given thprocesses in place as standard operating procedure.
Acknowledgements

The Gulfport-Biloxi International Airport and its partner comm

are grateful for the opportunity to apply for this grant. It is our that these funds are critical to the future of our airport and regWe believe the opportunities to serve the public are substantiathe growth specific to our regional market.
APPENDIX B 

Page 1 

SMALL COMMUNITY AIR SERVICE DEVELOPMENT PROGRAM 

DOCKET DOT-OST-2010-0124 

SUMMARY INFORMATION 

All applicants must submit this information with their proposal, along with a completed form SF424 on 

http://www.grants.gov. 

A. APPLICANT INFORMATION: (CHECK ALL THAT APPLY) 

X Not a Consortium □ Interstate Consortium □ Intrastate Consortium 

□ Community now receives EAS subsidy

X Community (or Consortium member) previously received a Small Community Grant 

If previous recipient: 

Date of grant: September 6, 2005 

Expiration date of grant: September 6, 2008

B. PUBLIC/PRIVATE PARTNERSHIPS: (LIST ORGANIZATION NAMES) 

Public Private 

1. Gulfport-Biloxi Regional Airport Authority 1. Gulf Coast Business Council 

2. Harrison County Convention and Visitors Bureau 2. Casino Operators Association 

3. Mississippi Development Authority 3. Gulf Coast Chamber of Commerce 

4. 4. 

5. 5. 

C. PROJECT PROPOSAL: (CHECK ALL THAT APPLY) 

X Marketing □ Upgrade Aircraft □ New Route 

□ Personnel □ Increase Frequency □ Low Fare Service 

□ Travel Bank □ Service Restoration □ Subsidy 

□ Surface Transportation □ Regional Service □ Other (specify) 

□ Revenue Guarantee □ Launch New Carrier 

□ Start Up Cost Offset □ First Service 

X Study □ Secure Additional Carrier 
APPENDIX B 

Page 2 

D. EXISTING LANDING AIDS AT LOCAL AIRPORT: 

X Full ILS X Outer/Middle Marker X Published Instrument Approach 

X Localizer □ Other (specify) 

E. PROJECT COST: 

1. Federal amount requested: __$280,000________________________ 

2. State cash financial contribution: __________________________ 

3. Local cash financial contribution...

3a. Airport cash funds: ______$125,000____________________ 

3b. Non-airport cash funds: ___$50,000_______________________ 

3c. Total local cash funds (3a. + 3b.): __$175,000________________________ 

4. TOTAL CASH FUNDING (1. + 2. + 3c.): ___$455,000_______________________ 

5. Local funds contributed from already-existing 

programs or projects included in line 3c. amount: __________________________ 

6. Local funds contributed from new commitments 

or new resources included in line 3c. amount: __$50,000________________________ 

7. Airport In-Kind contribution: __________________________ 

(amount & description) 

8. Other In-Kind contribution: __________________________ 

(amount & description) 

9. TOTAL IN-KIND CONTRIBUTION (7. + 8.): __________________________ 

10. TOTAL PROJECT COST (4. + 9.): ____$455,000______________________ 
APPENDIX B 

Page 3 

F. ENPLANEMENTS: 

2000 __476,078________ 2004 __442,365________ 2008 _488,033________ 

2001 __421,393________ 2005 __384,625________ 2009 _403,927________ 

2002 __400,533________ 2006 __402,905________ 

2003 __430,844________ 2007 __457,866________ 

G. IS THIS APPLICATION SUBJECT TO REVIEW BY STATE UNDER EXECUTIVE ORDER 12372 PROCESS? 

□ a. This application was made available to the State under the Executive Order 12372 Process for 

review on (date) _____________. 

□ b. Program is subject to E.O. 12372, but has not been selected by the State for review. 

X c. Program is not covered by E.O. 12372. 

H. IS THE APPLICANT DELINQUENT ON ANY FEDERAL DEBT? (IF “YES”, PROVIDE EXPLANATION) 

X No □ Yes (explain) _____________________________________________