Order: 2012-5-17

Served: May 22, 2012

 UNITED STATES OF AMERICA

 DEPARTMENT OF TRANSPORTATION

 OFFICE OF THE SECRETARY

 WASHINGTON, D.C.

Issued by the Department of Transportation

on the 22nd day of May, 2012

Essential Air Service at

MUSCLE SHOALS, ALABAMA

GREENVILLE, MISSISSIPPI

LAUREL/HATTIESBURG, MISSISSIPPI

TUPELO, MISSISSIPPI

GREENBRIER/WHITE SULPHUR 

SPRINGS, WEST VIRGINIA

DOCKET DOT-OST-2000-7856

DOCKET DOT-OST-2008-0209

DOCKET DOT-OST-2001-10685

DOCKET DOT-OST-2009-0305

DOCKET DOT-OST-2003-15553

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

ORDER SELECTING CARRIER

Summary

By this Order, the Department is selecting Silver Airways, formerly Gulfstream 

International Airways (Silver), to provide Essential Air Service (EAS) at Muscle Shoals,

Alabama, Greenville, Laurel/Hattiesburg, and Tupelo, Mississippi, and Greenbrier/White 

Sulphur Springs, West Virginia (Lewisburg), using 34-passenger Saab 340 aircraft, for a 

combined annual subsidy of $16,098,538.

1

 Muscle Shoals and Laurel/Hattiesburg will 

each receive 12 weekly nonstop round trips to Atlanta-Hartsfield International Airport 

(Atlanta) while Greenville and Tupelo will receive 18 weekly round trips over a 

Greenville-Tupelo-Atlanta routing. At Lewisburg, Silver will provide six weekly nonstop 

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

funds.
- 2 -

round trips to Atlanta and six to Washington Dulles International Airport (Washington)

during the six-month off peak season and seven per week during the peak season. 

Background

By a series of Orders, the Department selected Mesaba Aviation, Inc. (Mesaba), operating 

as Northwest Airlink (now Delta Connection), to provide subsidized EAS at Muscle 

Shoals, Greenville, Laurel/Hattiesburg and Tupelo.2

 

On July 15, 2011, Mesaba filed notices to terminate their subsidized service at twenty-four

EAS communities, including these four. In response, we issued Order 2011-9-5, 

September 13, 2011, holding the carrier’s service in place and requesting proposals for 

these four communities. We received proposals from Multi-Aero Inc. d/b/a Air Choice 

One (Air Choice One) and SeaPort Airlines, Inc. (SeaPort). Both carriers proposed service 

with single-engine aircraft, whereas all of the communities are entitled by statute to service 

with twin-engine aircraft. Since all four communities refused to waive their right to twinengine aircraft, by Order 2011-11-29, November 23, 2011, we requested a second round of 

proposals for the four communities. In response to that Order, we received proposals from 

Air Choice One, Citizens Capital Corp. d/b/a Blue Sky Airlines (Blue Sky), SeaPort, and 

Sun Air Express, LLC. (Sun Air). Air Choice One and SeaPort once again proposed 

service with single-engine aircraft. Blue Sky and Sun Air proposed service with larger 

aircraft but did not then (and still do not) have the authority from either the Federal 

Aviation Administration or the Department to operate such service. Therefore, we issued 

Order 2012-3-4, March 6, 2012, requesting a third round of EAS proposals. In response to 

that Order, we received proposals from Air Choice One and Silver.

With regard to Lewisburg, Atlantic Southeast Airlines, Inc. and Pinnacle Airlines, Inc., 

both operating as Delta Connection, were providing subsidy-free service from Lewisburg

to Atlanta and New York LaGuardia Airport (New York). However, on 

December 16, 2011, Delta filed a 90-day notice to terminate all of its service at Lewisburg 

effective March 12, 2012. In response to Delta’s filing, we issued Order 2012-2-7, 

February 9, 2012, prohibiting Delta from terminating service and requesting proposals. In 

response, we received a proposal from Silver that was contingent upon it also being 

selected at the four other communities at issue here, i.e., the proposals was a five-city, 

inseparable package.

Each carrier’s complete proposal and community comments may be accessed online at 

http://www.regulations.gov/ by entering each community’s Docket number in the search 

block: Muscle Shoals, DOT-OST-2000-7856; Greenville, DOT-OST-2008-0209;

Laurel/Hattiesburg, DOT-OST-2001-10685; Tupelo, DOT-OST-2009-0305; and 

Lewisburg, DOT-OST-2003-15553. In addition, the EAS staff negotiated several other 

service/subsidy options with both applicants, and they are summarized below as well as 

their original proposals.

 2 See Orders 2010-7-12, 2010-5-16, 2011-1-24 and 2010-5-18.
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Proposal of Air Choice One

Air Choice One initially submitted a proposal with six options, all proposing to serve

Memphis International Airport (Memphis), with the exception of Option 5, which proposes 

to serve Muscle Shoals from Atlanta. After subsequent negotiations with the Department, 

Air Choice One submitted an additional four options, listed here as Options 7-10. The 

charts below summarize the main components of each option.

Air Choice One - Option 1

Community

Annual 

Subsidy (2-

year term

Annual 

Subsidy (4-

year term)

Aircraft Seats Engines Stops Weekly 

Frequency

Muscle Shoals $1,478,752 $1,463,964 Navajo 8 2 0 24

Greenville $1,478,752 $1,463,964 Navajo 8 2 0 24

Laurel/Hattiesburg $1,478,752 $1,463,964 Navajo 8 2 0 24

Tupelo $1,478,752 $1,463,964 Navajo 8 2 0 24

Air Choice One – Option 2

Community

Annual 

Subsidy (2-

year term)

Annual 

Subsidy (4-

year term)

Aircraft Seats Engines Stops Weekly 

Frequency

Muscle Shoals $1,641,994 $1,625,574 Caravan 9 1 0 24

Greenville $1,641,994 $1,625,574 Caravan 9 1 0 24

Laurel/Hattiesburg $1,641,994 $1,625,574 Caravan 9 1 0 24

Tupelo $1,641,994 $1,625,574 Caravan 9 1 0 24

Air Choice One – Option 3, year one

Community Annual 

Subsidy Aircraft Engines Seats Stops Weekly Frequency

Greenville $2,457,368 Jetstream 2 8 0 24

Laurel/Hattiesburg $2,457,368 Jetstream 2 8 0 24

Air Choice One – Option 3, years 2-4

Community

Annual 

Subsidy 

(year two)

Annual 

Subsidy 

(years 3-4)

Aircraft Engines Seats Stops Weekly 

Frequency

Greenville $2,125,605 $2,104,349 Jetstream 2 18 0 18

Laurel/Hattiesburg $2,125,605 $2,104,349 Jetstream 2 18 0 18
- 4 -

Air Choice One – Option 4, year one

Community Annual 

Subsidy Aircraft Engines Seats Stops Weekly Frequency

Muscle 

Shoals $2,447,733 Jetstream 2 8 0 24

Tupelo $2,447,733 Jetstream 2 8 0 24

Air Choice One –Option 4, years 2-4

Community

Annual 

Subsidy 

(year 2)

Annual 

Subsidy 

(years 3-4)

Aircraft Engines Seats Stops Weekly 

Frequency

Muscle 

Shoals $2,102,143 $2,081,121 Jetstream 2 18 0 18

Tupelo $2,102,143 $2,081,121 Jetstream 2 18 0 18

Air Choice One – Option 5, year one

Community Annual 

Subsidy

Aircraft Engines Seats Stops Weekly 

Frequency

Muscle 

Shoals

$2,510,377 Jetstream 2 8 0 24

Tupelo $2,510,377 Jetstream 2 8 0 24

Air Choice One – Option 5, years 2-4

Community

Annual 

Subsidy 

(year 2)

Annual 

Subsidy 

(years 3-4)

Aircraft Engines Seats Stops Weekly 

Frequency

Muscle 

Shoals $2,113,865 $2,092,725 Jetstream 2 18 0 18

Tupelo $2,113,865 $2,092,725 Jetstream 2 18 0 18

Air Choice One – Option 6, year one

Community Annual 

Subsidy Aircraft Engines Seats Stops Weekly Frequency

Muscle 

Shoals $1,740,184 Navajo 2 9 0 24

Tupelo $1,740,184 Navajo 2 9 0 24

Air Choice One – Option 6, years 2-4

Community

Annual 

Subsidy 

(year 2)

Annual 

Subsidy 

(years 3-4)

Aircraft Engines Seats Stops Weekly 

Frequency

Muscle 

Shoals $2,051,058 $2,030,547 Jetstream 2 18 0 18

Tupelo $2,051,058 $2,030,547 Jetstream 2 18 0 18
- 5 -

Air Choice One – Option 7, 2-year term

Community Annual 

Subsidy Aircraft Engines Seats Stops Weekly Frequency

Greenville $1,789,740 Navajo or 

Caravan

2/Navajo

1/Caravan

8/ Navajo

9/ Caravan 0 24

Tupelo $1,789,740 Navajo or 

Caravan

1 for 

Caravan

2 for Navajo

8 for Navajo

9/Caravan 0 24

Air Choice One – Option 8, 2-year term

Community Annual 

Subsidy Aircraft Engines Seats Stops Weekly Frequency

Muscle 

Shoals $2,090,878 Navajo or Caravan

2/Navajo

1/Caravan

8/Navajo

9/Caravan 0 24

Greenville $2,090,878 Navajo or 

Caravan

2/Navajo

1/Caravan

8/Navajo

9/Caravan 0 24

Air Choice One – Option 9, 2-year term

Community Annual 

Subsidy Aircraft Engines Seats Stops WeeklyFrequency

Muscle 

Shoals $1,881,505 Navajo or Caravan

2/Navajo

1/Caravan

8/Navajo

9/Caravan 0 24

Tupelo $1,881,505 Navajo or 

Caravan

2/Navajo

1/Caravan

8/Navajo

9/Caravan 0 24

Air Choice One – Option 10, 2-year term

Community Annual 

Subsidy Aircraft Engines Seats Stops Weekly Frequency

Muscle 

Shoals $1,920,707 Navajo orCaravan

2/Navajo

1/Caravan

8/Navajo

9/Caravan 0 24

Greenville $1,920,707 Navajo or Caravan

2/Navajo

1/Caravan

8/Navajo

9/Caravan 0 24

Tupelo $1,920,707 Navajo orCaravan

2/Navajo

1/Caravan

8/Navajo

9/Caravan 0 24
- 6 -

Proposal of Silver

Silver submitted a five-city, inseparable, all-or nothing package proposal with two 

service/subsidy options. After subsequent negotiations with the Department, Silver 

submitted an additional two options, listed here as Options 3 & 4. The charts below 

summarize the main components of each option.

Silver - Option 1

Community Annual 

Subsidy Hub Aircraft Stops Weekly Frequency

Muscle Shoals $2,603,365 Atlanta Saab 340 0 12

Greenville $2,544,637 Atlanta Saab 340 1 18

Laurel/Hattiesburg $2,965,667 Atlanta Saab 340 0 12

Tupelo $4,500,159 Atlanta Saab 340 0 18

Lewisburg (peak and 

off-peak) $4,144,149 Atlanta Saab 340 0 14 (peak)12 (off-peak)

Silver - Option 2

Community Annual 

Subsidy Hub Aircraft Stops Weekly Frequency

Muscle Shoals $2,652,313 Atlanta Saab 340 0 12

Greenville $1,765,087 Atlanta Saab 340 1 12

Laurel/Hattiesburg $3,041,015 Atlanta Saab 340 0 12

Tupelo $3,073,535 Atlanta Saab 340 0 12

Lewisburg (peak 

and off-peak $4,241,523 Atlanta Saab 340 0 14 (peak)12 (off-peak)

Silver - Option 3

Community Annual 

Subsidy Hub Aircraft Stops Weekly Frequency

Muscle Shoals $2,603,365 Atlanta Saab 340 0 12

Greenville $2,544,637 Atlanta Saab 340 1 18

Laurel/Hattiesburg $2,965,667 Atlanta Saab 340 0 12

Tupelo $4,500,159 Atlanta Saab 340 0 18

Lewisburg (peak/offpeak) $3,484,710 Atlanta/Washington Saab 340 0 7 to each/6 to 

each

Silver - Option 4

Community Annual 

Subsidy Hub Aircraft Stops Weekly Frequency

Muscle Shoals $2,652,313 Atlanta Saab 340 0 12

Greenville $1,765,087 Atlanta Saab 340 1 12

Laurel/Hattiesburg $3,041,015 Atlanta Saab 340 0 12

Tupelo $3,073,535 Atlanta Saab 340 0 12

Lewisburg (peak/offpeak) $3,581,689 Atlanta/Washington Saab 340 0 7 to each/6 to 

each
- 7 -

Community Comments

The communities of Muscle Shoals, Greenville, Laurel/Hattiesburg, and Tupelo worked 

together to draft a detailed letter unanimously supporting Silver’s Option 1 (which we 

subsequently renegotiated to the rate level listed as Option 3). Specifically, four primary 

factors influenced the communities’ decision to support Silver’s proposal over Air Choice 

One: 1) service to Atlanta vs. service to Memphis; 2) use of 34-passenger Saab 340 aircraft 

vs. Air Choice One’s smaller 9-seat aircraft; 3) Silver’s complete set of interline and 

baggage agreements with all major airlines compared to Air Choice One’s lack of interline 

agreements with major airlines at Memphis and beyond; and 4) Silver’s enhanced interline 

agreement with Delta, the largest airline at Atlanta. Atlanta is not only the communities 

preferred hub airport but also provides more connecting options to the national air 

transportation system than Air Choice One’s service to Memphis. Silver’s interline and 

baggage agreements with all major airlines, including an enhanced interline agreement 

with Delta, will enable the communities to reach their final destination with ease.

The City of Lewisburg, which received no competing bids, also fully supported Silver’s 

proposal. Mr. John Manchester, Mayor of Lewisburg, says that Silver’s proposal “more 

than adequately addresses our community’s air service needs.” We note that Silver 

originally proposed service only to Atlanta but as a result of negotiations between the 

Department and the airline, Silver added two additional options that include service to 

Washington and Atlanta. The Department received comments from the community 

supporting service to both hubs.

Decision

We have decided to select Silver’s Option 3 at all five communities. The communities 

support Silver’s proposal and Silver is a well-established airline in the EAS program. 

Nonetheless, while we are very concerned about the significantly higher subsidy required 

by Silver compared to Air Choice One, we find that the statutory carrier-selection criteria

compel us to select Silver. In selecting a carrier to provide EAS, we are required to base 

our decision on the four carrier-selection criteria contained in 49 U.S.C. §41733(c), in 

addition to its proposed subsidy level: 1) the demonstrated reliability in providing 

scheduled air service; 2) the contractual and marketing arrangements with a larger carrier 

to ensure service beyond a hub airport; 3) interline agreements with a larger carrier; and 4) 

support by the community’s elected officials for the applicants proposal. Silver’s proposal 

meets, and has a comparative advantage over Air Choice One in all four of these statutory 

criteria. 

First, Silver, under its previous name Gulfstream International Airways, has been 

providing scheduled air service for nearly twenty years. Air Choice One has been in 

operation for even longer, but has only provided scheduled air service continuously since

2008. Silver is pursuing a code share with United that would provide Lewisburg 

passengers with seamless connections beyond the Washington Dulles hub to the national 

air transportation system. Moreover, Silver has an interline agreement with Delta and in a 

letter to the Department Delta states, “If Silver is selected, Delta would be willing to work 
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with Silver on developing an (enhanced) interline and ticketing arrangement, participation 

in our SkyMiles frequent flyer program, and booking capability on delta.com.” And 

finally, Silver has unanimous community support, the fourth carrier-selection criterion.

In addition, we note that at two communities, Laurel/Hattiesburg and Tupelo, Air Choice 

One’s proposal does not offer sufficient capacity to accommodate current passenger levels. 

For the year ended June 30, 2011, Laurel/Hattiesburg generated an average of 47

enplanements a day while Tupelo generated an average of 42 enplanements a day. Air 

Choice One proposes using 8 or 9-seat aircraft and offers essentially four round trips a day, 

which would at most provide 36 seats, well below each community’s current passenger 

levels.

Finally, as to which of Silver’s four options to choose, we select Option 3 because it 

provides sufficient capacity to meet the communities’ passenger levels. Silver’s Options 3 

and 4 are identical to its Options 1 and 2 except that Lewisburg would receive one round 

trip a day to Atlanta and Washington. Operationally, the split hub will allow Silver to flow 

aircraft and crew from its Washington operations to its Atlanta system, which is much 

closer to its maintenance base. The split hub options also require significantly less subsidy 

than the Atlanta-only options. As between Silver’s Option 3 and 4, Option 3 is clearly 

preferable. Its Option 4 would serve Greenville and Tupelo with 12 weekly round trips

over a Greenville-Tupelo-Atlanta routing, i.e., 68 seats in each direction in total for both 

communities. However, during the year ended June 30, 2011, Tupelo generated 42 

enplanements a day and Greenville, 24, a total of 66 enplanements a day. Thus, as a 

practical matter, that option does not provide sufficient capacity for those two 

communities, whereas Silver’s Option 3 would provide three round trips a day, or 102 

seats a day in each direction.

We shall make this selection of Silver contingent upon the Department’s receiving 

properly executed certifications from the carrier that it is in compliance with the 

Department’s regulations regarding drug-free workplaces and nondiscrimination, as well 

as the regulations concerning lobbying activities.3

Service Transition

We expect Silver, Pinnacle, Mesaba, and Delta to work together to make a smooth 

transition at these communities. In that regard, before Pinnacle, Mesaba, and Delta 

suspend their service they must notify any passengers holding reservations for travel after 

the suspension date, assist those passengers in making alternate air transportation 

arrangements, or provide a refund of the ticket price, without penalty, if requested. 

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 EAS. Silver is subject to the 

Department’s continuing fitness requirements, and no information has come to our 

attention that would cause us to question the carrier’s fitness at this time. We have 

 3 The certifications are available on the Web at http://ostpxweb.dot.gov/aviation/index.html. 
- 9 -

contacted the Federal Aviation Administration, and it has raised no concerns that would 

negatively affect our fitness findings. We therefore conclude that Silver is a reliable air 

carrier and remains fit to conduct the operations proposed here.

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

ACCORDINGLY,

1. We select Silver to provide Essential Air Service at Muscle Shoals, Alabama, and 

Greenville, Laurel/Hattiesburg, and Tupelo, Mississippi, and Lewisburg, West Virginia, 

and establish an annual subsidy rate as described in Appendix C;

2. We direct Silver 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 documentation shall be retained for seven years 

from the service date of this Order or until the Department indicates that the records may 

be destroyed, whichever comes first. Copies of flight logs for aircraft sold or disposed of 

must be retained. The carrier may forfeit its compensation for any claim that is not 

supported under the terms of this Order;

3. We find that Silver continue to be fit, willing and able to operate as a commuter carrier,

and capable of providing reliable Essential Air Service at Muscle Shoals, Alabama,

Greenville, Laurel/Hattiesburg, and Tupelo, Mississippi, and Lewisburg, West Virginia;
- 10 -

4. These dockets will remain open pending further Department action; and

5. We will serve copies of this Order on the Mayors and Airport Managers of Muscle 

Shoals, Alabama, Greenville, Laurel/Hattiesburg, and Tupelo, Mississippi, Lewisburg, 

West Virginia, Multi-Aero Inc. d/b/a Air Choice One, Silver Airways, and Delta Air Lines.

By:

SUSAN L. KURLAND

Assistant Secretary for

Aviation and International Affairs

(SEAL)

An electronic version of this document is available at

http://www.regulations.gov
` Appendix A

Page 1 of 2

AREA MAP
Appendix A

Page 2 of 2

AREA MAP
 Appendix B

Essential Air Service to be Provided at Greenville, Hattiesburg, Lewisburg, Muscle Shoals and Tupelo

Community Hattiesburg Lewisburg Muscle Shoals Greenville/Tupelo

Docket # 2001-10685 2002-11378 2000-7856 2008-0209

 (cont.) 2009-0305

Completion 98% 98% 98% 98%

3-Ltr Code PIB LWB MSL GLH/TUP

Aircraft Type Saab 340 Saab 340 Saab 340 Saab 340

Hub ATL ATL/IAD ATL ATL

Weekly Round Trips 1/ 12 13 12 18

Block Hours 2,042 2,159 1,531 4,290

Passengers 20,825 22,591 13,328 35,581

Avg. Fare $91.57 $91.57 $91.57 $91.57

Total Revenue $1,906,945 $2,068,654 $1,220,445 $3,258,128

Crew $720,278 $761,823 $540,208 $1,513,390

Fuel $1,202,008 $1,271,824 $905,970 $2,563,867

Maintenance $1,403,812 $1,484,784 $1,052,859 $2,949,577

Aircraft Ownership $283,680 $366,686 $182,366 $540,478

 Total Directs $3,609,778 $3,885,117 $2,681,403 $7,567,312

Distribution $275,478 $298,838 $176,306 $589,133

Promotion $12,000 $12,000 $12,000 $24,000

Station $573,962 $874,041 $663,137 $1,309,183

Overhead $169,365 $218,922 $108,878 $322,681

 Total Indirects $1,030,805 $1,403,801 $960,321 $2,244,997

Total Operating $4,640,583 $5,288,918 $3,641,724 $9,812,309

Profit @ 5% $232,029 $264,446 $182,086 $490,615

Economic Cost $4,872,612 $5,553,364 $3,823,810 $10,302,924

Annual Subsidy $2,965,667 $3,484,710 $2,603,365 $7,044,796

1/ Twelve nonstop round trips per week each for Hattiesburg and Muscle Shoals; eighteen one-stop

round trips -- GLH-TUP-ATL and return -- for Greenville and Tupelo. At Lewisburg, 

Silver proposes a total of twelve nonstop round trips per week in the 26-week off-peak and

fourteen nonstop round trips per week in the 26-week peak period. Half of the service 

in each time period would be to Washington (IAD) and half to Atlanta (ATL).
 Appendix C

Page 1 of 5

Silver Airways

Essential Air Service to be Provided at Muscle Shoals, Alabama

Effective Period: Beginning with full EAS through the end of the 24th month thereafter

Scheduled Service: 12 weekly nonstop round trips to Atlanta

Aircraft: 34-passenger Saab 340

Rate per Eligible Flight: $2,1291

Weekly Ceiling for each community: $51,0962

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance 

with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significant 

elements of the required service, without prior approval. The carrier understands that an aircraft take-off and landing at its 

scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight that 

has not been completed, such as certain weather cancellations, only completed flights are considered eligible for subsidy. 

In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant period, 

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 operated; 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 incorporate by reference, relevant statutes and Department regulations, as they may be 

amended from time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert 

the foregoing paragraph.

Funds 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 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 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 $2,603,365 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 $2,129 per flight.
 Appendix C

Page 2 of 5

Silver Airways

Essential Air Service to be Provided at Greenville, Mississippi

Effective Period: Beginning with full EAS through the end of the 24th month thereafter

Scheduled Service: 18 weekly one-stop round trips to Atlanta

Aircraft: 34-passenger Saab 340

Rate per Eligible Flight: $1,9201

Weekly Ceiling for each community: $69,1202

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance 

with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significant 

elements of the required service, without prior approval. The carrier understands that an aircraft take-off and landing at its 

scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight that 

has not been completed, such as certain weather cancellations, only completed flights are considered eligible for subsidy. 

In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant period, 

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 operated; 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 incorporate by reference, relevant statutes and Department regulations, as they may be 

amended from time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert 

the foregoing paragraph.

Funds 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 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 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 $7,044,796 divided by two cities = $3,522,398. 

$3,522,398 divided by 1,835 annual departures (36 weekly departures x 52 weeks x 98 percent completion). 2 36 arrivals and departures per week multiplied by $1,920 per flight.
 Appendix C

Page 3 of 5

Silver Airways

Essential Air Service to be Provided at Laurel/Hattiesburg, Mississippi

Effective Period: Beginning with full EAS through the end of the 24th month thereafter

Scheduled Service: 12 weekly nonstop round trips to Atlanta

Aircraft: 34-passenger Saab 340

Rate per Eligible Flight: $2,4251

Weekly Ceiling for each community: $58,2002

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance 

with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significant 

elements of the required service, without prior approval. The carrier understands that an aircraft take-off and landing at its 

scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight that 

has not been completed, such as certain weather cancellations, only completed flights are considered eligible for subsidy. 

In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant period, 

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 operated; 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 incorporate by reference, relevant statutes and Department regulations, as they may be 

amended from time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert 

the foregoing paragraph.

Funds 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 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 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 $2,965,667 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 $2,425 per flight.
 Appendix C

Page 4 of 5

Silver Airways

Essential Air Service to be Provided at Tupelo, Mississippi

Effective Period: Beginning with full EAS through the end of the 24th month thereafter

Scheduled Service: 18 weekly nonstop round trips to Atlanta

Aircraft: 34-passenger Saab 340

Rate per Eligible Flight: $1,9201

Weekly Ceiling for each community: $69,1202

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance 

with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significant 

elements of the required service, without prior approval. The carrier understands that an aircraft take-off and landing at its 

scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight that 

has not been completed, such as certain weather cancellations, only completed flights are considered eligible for subsidy. 

In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant period, 

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 operated; 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 incorporate by reference, relevant statutes and Department regulations, as they may be 

amended from time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert 

the foregoing paragraph.

Funds 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 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 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 $7,044,796 divided by two cities = $3,522,398. 

 $3,522,398 divided by 1,835 annual departures (36 weekly departures x 52 weeks x 98 percent completion). 2 36 arrivals and departures per week multiplied by $1,920 per flight.
 Appendix C

Page 5 of 5

Silver Airways

Essential Air Service to be Provided at Lewisburg, West Virginia

Effective Period: Beginning with full EAS through the end of the 24th month thereafter

Scheduled Service: 12 weekly nonstop round trips in the 26-week off-peak season (November 1-

April 30), 14 weekly nonstop round trips in the peak 26-week season (May 1- October 31)

Hub: Atlanta and Washington Dulles

Aircraft: 34-passenger Saab 340

Rate per Eligible Flight: $2,6221

Weekly Ceiling: Peak: $73,4162

 Off-peak: $62,9283

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance with the terms 

and stipulations of the rate Order, including the service plans outlined in the Order and any other significant elements of the required 

service, without prior approval. The carrier understands that an aircraft take-off and landing at its scheduled destination constitutes a 

completed flight; absent an explanation supporting subsidy eligibility for a flight that has not been completed, such as certain weather 

cancellations, only completed flights are considered eligible for subsidy. In addition, if the carrier does not schedule or operate its flights 

in full conformance with the Order for a significant period, 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 operated; 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 incorporate by reference, relevant statutes and Department regulations, as they may be amended from 

time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds 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 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 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 $3,484,710 divided by 1,329 estimated annual completed departures and arrivals: 

Peak: LWB-IAD (7 trips per week x 2 directions x 26 weeks x 98 percent completion x 313/312)

 LWB-ATL (7 trips per week x 2 directions x 26 weeks x 98 percent completion x 313/312)

Off Peak: LWB-IAD (6 trips per week x 2 directions x26 weeks x 98 percent completion x 313/312)

 LWB-ATL (6 trips per week x 2 directions x 26 weeks x 98 percent completion x 313/312) 2 Peak: 28 arrivals and departures per week multiplied by $2,622 3 Off-peak: 24 arrivals and departures per week multiplied by $2,622