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•••^ r • • us . Departmen t o f " 120 0 Ne w jerse yAvenue , S E Transportatio n Washington , D C 2059 0 Offic e o f th e Secretar

y o f Transportatio n ' 

### Th e Honorabl e Heathe r

Hudso n Jun e 10 , 201 0 P.O . Bo x 89 7 Greenville , M S 38702-089 7 Dea r Mayo r Hudson : A s yo u know , Mesab aAviation , Inc. , d/b/ aDelt aConnectio n (Mesaba) , provide s subsidize dai r servic e unde r

th e essentia l ai r

servic e (EAS ) progra ma t Greenville . Th e Department' s curren t contrac t with Mesab acall s for

an annua l subsid y o f

$1,355,69 3 t o provid e Greenvill e with fourtee n nonsto p roun dtrip s pe r wee k t o Memphi s with 34-seat Saab 34 0 aircraft , an dexpire s Septembe r

30 . In anticipatio n o f

th e en do f

that contract , b y Orde r

2010-5- 2 th e Departmen t requeste d"bes t

an dfinal " proposal s t o serv e Greenvill e for anew , two-year

period , an dw e receive dtimely-file dproposal s fro mMesab aan dfro mAlask aJunea u Aeronautics, , Inc. , d/b/ a SeaPort Airline s (Seaport) . My purpos e i n writin g i s t o informyo u o f th e result s o f

eac h carrier' s servic e an dsubsid y proposa l befor e w e submi t arecommendatio n o n th e carrier-selectio n issu e t o th e Assistan t Secretary for

Aviatio n an dInternationa l Affair s for decision . Copie s o f

eac h carrier' s full proposa l may b e accesse donlin e throug h th e Department' s Docket s Managemen t Syste ma

t http://www.regulations.gov / b y enterin g "DOT-OS T 2008-0209 " i n th e "ente r Keywor do r

ID " field , s o w e wil l onl y summariz e it here . SeaPor t SeaPort propose s t o provid e atota l o f thirt y (30 ) nonsto p roun dtrip s pe r week : twelv e t o Ne w Orlean s an deightee n t o Memphi s —for atota l annua l subsid y o f $2,339,88 2 th e firs t yea r an d$2,409,32 5 th e secon dyear . Al l servic e woul db e with 9-seat , single-engine , pressurized , turboprop Pilatu s PC-1 2 aircraft . Mesab aMesab apropose s t o continu e it s curren t leve l o f servic e —fourtee n roun dtrip s pe r wee k t o Memphi s —for

atota l annua l subsid y o f $1,606,662 . Al l servic e woul doperat e o n a nonsto p basi s wit

h 34-seat Saab 340s , atwin-engine , turboprop , an dpressurize daircraft . W e not e that

Greenville' s EA S call s for servic e with 15-seat , twin-engin e aircraft . Thu s i t i s likel y w e woul donl y selec t SeaPort i f th e communit y waive s thos e assurances . In that event , w e woul dconside r

tha t waive r effectiv e onl y for

th e two-year

perio do f th e SeaPort

contract . Pleas e not e that

th e average passenge r

fare s show n i n th e carriers ' proposal s d o no t necessaril y reflec t th e average loca l fare s passenger s woul dpay , but rathe r reflec t th e prorate dportio n o f

th e tota l ticke t

price , e.g. , th e Greenvill e - Memphi s portio n o f aGreenvill e - Memphi s - Atlant a ticke t that th e carrie r

woul drealize . Also , th e implici t average fare , a s reflecte di n th e carriers ' subsid y calculations , enclose da s Appendice s A an dB , i s ne t o f certai n charge s suc h a s federal transportatio n security fees , excis e an dticke t taxes , an dpassenge r

facility charges . O f

course , carrier s hav e th e discretio n t o charg e fare s the y dee mappropriate , an dth e passenge r fare s show n i n Appendice s A an dB wer e develope dfor subsid y rat e computatio n purpose s only . Eac h

### carrie r

woul dhav e t o realiz e passenge r fare s comparabl e t o th e average s show n i ait s proposal-i n orde r t o achiev e break-eve n o r profitabl e operation s eve n with subsidy . Yo u shoul dals o not e tha t th e schedule s submitte db y th e tw o carrier s an dreproduce di n Appendi x C ar e illustrativ e only , an dth e carrie r selecte dma y mak e schedul e change s t o reflec t changin g conditions , e.g. , t o bette r mee t shiftin g connectin g ban k tim^ s a t th e hub . Th e Departmen t

expect s subsidize dai r

carrier s t o maintai n well-time dan dwell-space dflight s i n orde r t o ensur e ful l compensation . W e kno w thi s matte r

i s importan t

t o yo u an dw e wil l ac t

a s quickl y a s possibl e upo n receip t o f you r letter . In orde r

t o expedit e th e case , pleas e submi t you r comment s b y emai l t o EAS@dot.go v an dt o Kevin.Adams@dot.gov . b y Jun e 23 . I f yo u hav e an y question s o r d o no t wis h t o submi t

formal comments , pleas e contac t Kevi n Adam s at

(202 ) 366-1047 . Sincerely , G-A^i r 

### ^ ^ Denni s J . DeVan y Chief , Essentia l Ai r

Servic e Divisio n Offic e o f Aviatio n Analysi s Enclosure s cc : Airport

Manager , Mesaba , SeaPor t

# A^ p e ^ M i x 

# A

^"^ V

Revenua : Passenge r Forecaste d Passenger s Averag e Revenu e /

Pa x Estimate : Oct 200 9 - Sep t 201 0 Revenu e /

Pa xChang e Averag e Revenu e /

Pa x Passenge rRevenu e Othe rRevenue : Rati o t o Passenge rRevenu e Othe rRevenu e Tota l Revenu e Ooeratin a E^^psfts^

s Complete d Bloc k

Hour s Direc t Fligh t Crew s Fue l Gallon s / Bloc k Hou r Int o Plan e Cost/Gallo n Fue l Cost/Bloc k

Hou r Insuranc e Maintenanc e Aircraf t Leas e Tota l Direc t indirec t Expens e Tota l Operatin g Ex p Retur n Tota l Economi c Cos t Surplus ; (Deficit ) Annua l Subsid y Complete d Departure s Facto r

$ 75.5 8 74 $ 3.9 4 $ 291.3 8 $ 37.6 1 $ 221.7 6 $ 110.44 39.00 % 5.00 % N«wOrlmn « GLH-MS Y 4,72 5 $ 99.9 9 0.00 % $ 99.9 9 $ 472.45 3 1.00% $ 4,72 5 $ 477,17 8 1,252.4 8 94.66 5

364.94 8 47,10 6 277,75 0 138,32 4 9 922.79 3 359,88 9 $ 1,282,68 2 64,13 4 $ 1,346.81 6 $ (869,638 ) $ 869,83 8 1,21 6 Mamphl * GLH-ME M 7,87 5 $ 94.9 4 0.00 % $ 94.9 4 $ 747,65 3

• 1.00% S 7,47 7 $ 755,13 0 2,134.0 8 161,29 8
621,82 8 80,26 3 473,25 4 235,68 8 % 1,572.33 1 613,20 9 S 2,185.54 0 109,27 7 $ 2,294,81 7 $(1,539,687 ) $1,539,68 7 1,82 4

### % 

## U->^o* -

Revenue : Passenger : Forecaste d Passenger s Averag e Revenu e /

Pax :

. . Cun-ent : Oct 200 8 - Sep t 200 9 Revenu e /

Pa xChang e Averag e Revenu e /

Pa x Passenge rRevenu e Othe rRevenue : Rati o t o Passenge rRevenu e Othe rRevenu e Tota l Revenu e Qoeratin a Exoense s Complete d Bloc k

Hour s Direc t Fligh t Crew s Fue l Gallon s / Bloc k Hou r Int o Plan e Cost /

Gallo n Fue l Cost/Bloc k

Hou r Insuranc e Maintenanc e Aircraf t Leas e Tota l Direc t Indirec t Expens e Tota l Operatin g Ex p Retur n Tota l Economi c Cos t Surplu s / (Deficit ) Annua l Subsid y Complete d Departure s Facto r

$ 74.1 0 7 4 $ 3.7 5 $ 277.5 0 $ 37.6 1 $ 211.2 0 $ 110.44 39.00 % 5.00 % Ne w Orican a GUH-MS Y
4.50 0 $ 99.0 0 1.00% $ 99.9 9 $ 449.95 5 1.00% $ 4.S0 0 $ 454.45 5 1,252.4 8 92,80 9
347,56 3 47,10 6 264,52 4 138,32 4 $ 890,32 6 347.22 7 $1,237,55 3 61.87 8 $ 1,299,43 1 $ (844,976 ) $ 844,97 6 1,21 6 Mwnptil s GLH-ME M 7,50 0 $ 94.0 0 1.00% $ 94.9 4 $ 712,05 0 1.00% $ 7.12 1 $ 719,17 1 2,134.0 8 158,13 5
592,20 7 80,26 3 450,71 8 235,68 8 $ 1.517.01 1 591,63 4 $ 2,108,64 5 105,43 2 $ 2,214,07 7 $(1,494,906 ) $ 1.494,90 6 1,82 4EA S Statio n GLH Docket Number DOT-OST-2001-1068 5 Hub ^ MEM Roun dtrip s pe

r wee k 1 4 Completio n Facto r

97 % Tota l Passengei s 9,91 3 Tota l Block Hour s 1,27 2 Tota l Departure s . 1,41 6 Passenger Revenu e $743,50 5 •Othe r Revenu e 193,77 7 Total Revenu e $837,28 2 Pilot s $318,02 3 Fuel $318,42 6 Maintenanc e $545,85 6 Aircraf t $289,04 4 Total Direct s $1,471,34 9 ToUl Indirect s $839,70 9 Total Operatin g $2,311,05 8 Inflatio n Rate allowanc e 075 % $17,33 3 Profit 5.0 % $irS,S5 3 Economi c Cos t

$2,443,94 4 Re«}uire dAnnua l Subsidy Rat

e $ 1,606,66 2c 

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^Appendi xC Propose d Schedul e Mesab a Pag e 2 o f 2

Greenvill e t o Memphi s Memphi s t o Greenvill e Dep . Arriva l Dep . Arriva l Tim e Tim e Tim e Tim e 

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