Order: 2014-4-24

Served: April 22, 2014

 

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 22nd of April, 2014

Essential Air Service at

MUSCLE SHOALS, ALABAMA

GREENVILLE, MISSISSIPPI

LAUREL/HATTIESBURG, MISSISSIPPI

MERIDIAN, MISSISSIPPI

TUPELO, MISSISSIPPI

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

 Docket DOT-OST-2000-7856

 Docket DOT-OST-2008-0209

 Docket DOT-OST-2001-10685

 Docket DOT-OST-2008-0112

 Docket DOT-OST-2009-0305

ORDER PROHIBITING TERMINTATION OF SERVICE

AND REQUESTING PROPOSALS

Summary

By this Order, the Department prohibits Silver Airways Corp. (Silver), from terminating service 

at Muscle Shoals, Alabama, Greenville, Laurel/Hattiesburg, Meridian, and Tupelo, Mississippi,

for 30 days beyond the end of the air carrier’s 90-day notice period, i.e. August 7, 2014. We are 

also requesting proposals from air carriers interested in providing Essential Air Service (EAS) at 

Muscle Shoals, Greenville, Laurel/Hattiesburg, Meridian, and/or Tupelo. (See Appendix A for a 

map). Proposals are due May 19, 2014. 

Background

By Orders 2012-5-17 (May 22, 2012), the Department selected Silver to provide subsidized EAS 

at Muscle Shoals, Greenville, Laurel/Hattiesburg, and Tupelo,1 for a combined annual subsidy of 

$12,613,828 ($2,603,365 for Muscle Shoals, $7,044,796 for Greenville and Tupelo, and 

$2,965,667 for Laurel/Hattiesburg). By Order 2012-7-35 (July 30, 2012), the Department

selected Silver to provide service to Meridian for an annual subsidy of $2,417,808. Both Orders 

 1 Order 2012-5-17 also selected Silver to provide EAS at Greenbrier/White Sulphur Springs, West Virginia, but that 

community is not affected by Silver’s 90-day termination notices at the five communities discussed here.
2

selected Silver to provide service for a two-year period beginning when Silver inaugurated full 

EAS through the end of the 24th month thereafter. Silver inaugurated service at all five 

communities on October 1, 2012, thus setting an expiration date of September 30, 2014. Silver 

operates its service to all five communities with 34-passenger Saab 340 aircraft to HartsfieldJackson Atlanta International Airport (Atlanta).

On April 9, 2014, Silver filed a 90-day notice of its intention to terminate scheduled air service at 

Muscle Shoals, Greenville, Laurel/Hattiesburg, Meridian, and Tupelo effective July 8, 2014. In 

that notice, Silver explains it is no longer able to provide subsidized service to these cities due to 

multiple factors. Among those factors are increased costs associated with the new Federal 

regulatory requirements in which an air transport pilot certification is required as well as new 

flight and duty limitation and rest rules for flight crew members, the impact of the recent 

nationwide pilot shortage, and disappointing traffic results in some of these cities. Because 

Silver’s termination would mean that the communities would not have scheduled air service that 

they are entitled to under the EAS program, the Department must initiate a new carrier-selection 

process. 

We note that 49 U.S.C. § 41731(a)(1)(B) provides that communities enplaning fewer than ten 

passengers per day based on traffic for the year ended September 30, 2013, are not eligible for 

EAS support, barring a waiver from the Secretary. The Department is working towards 

implementation of that provision, and we anticipate addressing that matter in the near future, 

which could affect some, but likely not all of these five communities. In the meantime, the 

communities will soon be without their required EAS. As developments on the ten enplanement 

provision proceed, we will keep potential applicants and the communities fully informed and will 

take appropriate action. 

The complete public file for EAS at all five communities may be accessed online through the 

Federal Dockets Management System at: www.regulations.gov by entering each community’s 

respective docket number in the “Search for Rules, Comments, Adjudications, or Supporting 

Documents” field.

Hold-In

Silver’s proposed termination of service at Muscle Shoals, Greenville, Laurel/Hattiesburg, 

Meridian, and Tupelo would cause service levels to drop below the EAS guaranteed levels 

established by the Department. Thus, the Department must prohibit the air carrier from 

terminating such service at the end of its 90-day notice, i.e. July 8, 2014. We will require Silver 

to continue to maintain its current level of service at these five communities for successive 30-

day periods until we have completed processing the air carrier-replacement case and the selected 

air carrier has actually started service.2

 2 In accordance with 49 U.S.C. 41734(c), we will extend Silver’s service obligation for successive 30-day periods as 

necessary until replacement service actually begins.
3

Request for Proposals3

In order to provide sufficient time to complete the air carrier-selection process before Silver

terminates its service, we are hereby requesting proposals from air carriers interested in 

providing service at Muscle Shoals, Greenville, Laurel/Hattiesburg, Meridian, and Tupelo, 

with or without subsidy support, for a new two-year period. Air carriers should file their 

proposals no later than May 19, 2014. After that date, our staff will docket proposals, thereby 

making them public, and direct each air carrier to serve a copy of its proposal on the civic 

parties and other applicants. Shortly thereafter, we will provide a summary of the proposals to 

community officials and ask them to submit their final comments. We will give full 

consideration to all proposals filed in a timely manner.4

Interested air carriers should prepare their proposals with every expectation that their initial 

proposals will represent their final and only proposals. However, we retain the discretion to 

negotiate proposals with carriers when we deem it desirable; in such cases, of course, we will 

give all applicants the same opportunity. We also retain the discretion to reject outright all 

unreasonable or unrealistic proposals and re-solicit a new round of proposals. However, 

negotiation and rejection are only occasional exceptions to the rule.

We are here providing interested air carriers with some basic information to serve as guidance 

when they prepare their proposals, but we will not prescribe a precise format for their 

proposals. Carrier proposals should be submitted to the Department with all materials merged 

into a single document. In addition, because the document will be published on Regulations.gov, 

each page should be formatted to be viewed online. We expect proposals to adequately describe 

the service being proposed and the annual amount of subsidy being requested. The applicants 

can make their own judgments as to the level of detail they wish to present; however, we 

recommend they include information concerning proposed schedules and projected block 

hours. In addition, applicants are encouraged to provide financial data supporting their subsidy 

requests, including information on their projected expenses and revenues. We strongly 

encourage clear, well-documented proposals that will facilitate their evaluation by the affected 

community and the Department.5

 3 Applicants should be aware of the provisions of 49 U.S.C. § 41731(a)(1)(B), the ten enplanement rule, discussed 

above, when preparing their proposals. Staff will be available to answer any questions. 4 Carriers should not expect the Department to accept late filings. In cases where a carrier proposes to provide EAS 

without subsidy and we determine that basic EAS, required by 49 U.S.C. § 41732, can be reliably provided without 

such compensation, we typically do not proceed with the carrier-selection case. Instead, we simply rely on that 

carrier’s subsidy-free service as proposed.

5 In selecting a carrier to provide subsidized EAS for an eligible place not in Alaska, 49 U.S.C. § 41733(c)(1) 

directs us to consider five factors: (a) service reliability; (b) contractual and marketing arrangements with a larger 

carrier at the hub; (c) interline arrangements with a larger carrier at the hub; (d) community views, giving substantial 

weight to the views of the elected officials representing the users; and (e) whether the carrier has included a plan in 

its proposal to market its service to the community. In addition, the Consolidated and Further Continuing 

Appropriations Act, 2014, Public Law No. 113-76, provides that when selecting a carrier to provide EAS, the 

Department may consider the relative subsidy requirements, thus codifying a factor that we have considered since the 

inception of the program. Interested carriers should also be aware that our general provisions governing 

Essential Air Service will be included in the selection Order as part of our authorization of subsidy for the 

selected service. Appendix D of this order contains those general provisions.
4

We have provided some historic traffic data for the communities in Appendix B.6 Traffic has 

decreased year over year. The Department expects proposals similar to what each community 

currently receives using 30-passenger or larger seat aircraft to a large- or medium-hub that 

provides access to the national air transportation system.

Muscle Shoals 12 weekly nonstop round trips 

Greenville 12 weekly nonstop roundtrips or 18 weekly 

one-stop round trips

Laurel/Hattiesburg 12 weekly nonstop round trips

Meridian 12 or 13 weekly nonstop round trips 

Tupelo 12 weekly nonstop round trips or 18 

weekly one-stop round trips

Alternatively, we will accept proposals consisting of additional frequencies if smaller aircraft 

(9-passenger) are contemplated. We encourage proposals that meet these guidelines in an 

efficient manner. Air carriers are also welcome to propose more than one service option, if 

they choose. They also need not limit themselves to these requirements if they envision other, 

potentially more attractive service possibilities -- different hubs or length of contract, for 

example -- with subsidy requirements that remain competitive.

Other Carrier Requirements

The Department is responsible for implementing various Federal statutes governing lobbying 

activities, drug-free workplaces, and nondiscrimination.7 Consequently, all carriers receiving 

Federal subsidy for EAS must certify that they are in compliance with Department regulations 

regarding drug-free workplaces and nondiscrimination, and those carriers whose subsidies 

exceed $100,000 over the life of the contract must also certify that they are in compliance with 

the regulations governing lobbying activities. Because the Department is prohibited from paying 

subsidy to carriers that do not submit these documents, all carriers that plan to submit proposals 

involving subsidy should be aware that the selected carrier will be required to complete the 

required certifications. Interested carriers requiring more detailed information regarding these 

requirements should contact the Office of Aviation Analysis at (202) 366-5903.8

 6 Source: Bureau of Transportation Statistics T-100 Market.

7 The regulations applicable to these areas are: (1) 49 CFR Part 20 -- New Restrictions on Lobbying; 

 (2) 49 CFR Part 21 -- Nondiscrimination in Federally-Assisted Programs of the Department of Transportation -- 

Effectuation of Title VI of the Civil Rights Act of 1964; (3) 49 CFR Part 27 -- Nondiscrimination on the Basis of 

Disability in Programs and Activities Receiving or Benefiting from Federal Financial Assistance; (4) 

14 CFR Part 382 -- Nondiscrimination on the Basis of Disability in Air Travel; and (5) 49 CFR Part 29 --

Government-Wide Debarment and Suspension (Non-Procurement) and Government-Wide Requirements for DrugFree Workplace (Grants).

8 The certifications are also available on the web at http://www.dot.gov/policy/aviation-policy/small-communityrural-air-service/essential-air-service. 
5

Community Comments

Civic officials and the states are welcome to submit comments at any time. We encourage 

prospective applicants to contact communities before they submit their proposals so that they can 

tailor them to the community’s needs, as they will not be able to amend them after the due date. 

As noted earlier, we will provide a summary of the proposals to the civic parties shortly after the 

deadline for carrier proposals, and ask them to submit their final comments.

This Order is issued under authority delegated in 49 CFR Part 1.25a(b) and re-delegated to the 

Director, Office of Aviation Analysis.

ACCORDINGLY,

1. We prohibit Silver Airways Corp. from suspending service at Muscle Shoals, Greenville, 

Laurel/Hattiesburg, Meridian, and Tupelo, at the end of the 90-day notice period, and require it to 

maintain its current level of service at the communities, as set forth in Appendix C, for an initial 

30-day period through August 7, 2014, or until an air carrier capable of providing reliable EAS 

actually begins service, whichever is first;

2. We request that air carriers interested in providing EAS at Muscle Shoals, Greenville, 

Laurel/Hattiesburg, Meridian, and Tupelo, submit their proposal, with or without subsidy 

requests, no later than May 19, 2014. The proposal should be emailed to: 

michael.f.martin@dot.gov with the title “Proposal to Provide EAS at Muscle Shoals, Greenville, 

Laurel/Hattiesburg, Meridian, and/or Tupelo9”;

2. These dockets will remain open until further Order of the Department; and

3. We will serve copies of this Order on the mayors of Muscle Shoals, Greenville, Hattiesburg,

Laurel, Meridian, and Tupelo, the airport managers of Northwest Alabama Regional Airport,

Mid-Delta Regional Airport, Hattiesburg-Laurel Regional Airport, Meridian Regional Airport, 

and Tupelo Regional Airport, and the service list for these dockets.

 9 Questions regarding filings in response to this order should be directed to Michael Martin at 202-366-6494, or via 

email at mail to:michael.f.martin@dot.gov.
6

Persons entitled to petition the Department for review of this Order under the Department’s 

Regulations, 14 CFR Part 385.31(a), must file such petitions within seven (7) days after the date 

of service of this Order.

This Order will be effective immediately, and the filing of a petition for review shall not preclude 

its effectiveness.

By:

SUSAN L. KURLAND

Assistant Secretary for

Aviation and International Affairs

(SEAL)

An electronic version of this document is available

online at www.regulations.gov. 
Appendix A

AREA MAP

Maps generated by the Great Circle Mapper - copyright © Karl L. Swartz
Appendix B

Page 1 of 5

Muscle Shoals, Alabama

Quarter Year Deplanements Enplanements Total Traffic

Enplanements 

per Day

1 2010 1,501 1,562 3,063 20

2 2010 2,071 2,194 4,265 27

3 2010 2,175 2,257 4,432 28

4 2010 2,468 2,567 5,035 32

Annual 

Totals 8,215 8,580 16,795 27

1 2011 1,709 1,775 3,484 23

2 2011 1,866 1,915 3,781 24

3 2011 1,387 1,423 2,810 18

4 2011 2,207 2,251 4,458 28

Annual 

Totals 7,169 7,364 14,533 23

1 2012 1,730 1,779 3,509 23

2 2012 1,044 930 1,974 13

3 2012 943 946 1,889 12

4 2012 433 411 844 5

Annual 

Totals 4,150 4,066 8,216 13

1 2013 499 509 1,008 7

2 2013 566 552 1,118 7

3 2013 504 499 1,003 6

4 2013 489 453 942 6

Annual 

Totals 2,058 2,013 4,071 7
Appendix B

Page 2 of 5

Greenville, Mississippi

Quarter Year Deplanements Enplanements

Total 

Traffic

Enplanements 

per Day

2010 1 1055 1088 2,143 14

2010 2 1376 1450 2,826 18

2010 3 1652 1752 3,404 22

2010 4 1792 1840 3,632 23

Annual 

Totals 5,875 6,130 12,005 19

2011 1 1390 1408 2,798 18

2011 2 1784 1877 3,661 23

2011 3 1897 1903 3,800 24

2011 4 2010 2008 4,018 25

Annual 

Totals 7,081 7,196 14,277 23

2012 1 1289 1277 2,566 17

2012 2 1544 1563 3,107 20

2012 3 1463 1484 2,947 19

2012 4 814 793 1,607 10

Annual 

Totals 5,110 5,117 10,227 16

2013 1 764 753 1,517 10

2013 2 583 734 1,317 8

2013 3 716 679 1,395 9

2013 4 635 658 1,293 8

Annual 

Totals 2,698 2,824 5,522 9
Appendix B

Page 3 of 5

Hattiesburg/Laurel, Mississippi

Quarter Year Deplanements Enplanements

Total 

Traffic

Enplanements 

per Day

2010 1 3205 2928 6,133 40

2010 2 3395 3121 6,516 42

2010 3 3501 3367 6,868 44

2010 4 3550 3326 6,876 44

Annual 

Totals 13,651 12,742 26,393 42

2011 1 2974 2876 5,850 38

2011 2 3747 3617 7,364 47

2011 3 3752 3640 7,392 47

2011 4 4485 4240 8,725 55

Annual 

Totals 14,958 14,373 29,331 47

2012 1 3629 3375 7,004 45

2012 2 2651 2739 5,390 35

2012 3 3093 3364 6,457 41

2012 4 1407 1274 2,681 17

Annual 

Totals 10,780 10,752 21,532 34

2013 1 1666 1505 3,171 21

2013 2 1523 1492 3,015 19

2013 3 1518 1445 2,963 19

2013 4 1382 1349 2,731 17

Annual 

Totals 6,089 5,791 11,880 19
Appendix B

Page 4 of 5

Meridian, Mississippi

Quarter Year Deplanements Enplanements

Total 

Traffic

Enplanements 

per Day

2010 1 3825 3671 7,496 49

2010 2 4042 4364 8,406 54

2010 3 4222 4257 8,479 54

2010 4 4332 4480 8,812 56

Annual 

Totals 16,421 16,772 33,193 53

2011 1 3858 3869 7,727 50

2011 2 4181 4720 8,901 57

2011 3 3972 4151 8,123 51

2011 4 4024 4339 8,363 53

Annual 

Totals 16,035 17,079 33,114 53

2012 1 3792 3841 7,633 50

2012 2 3973 4364 8,337 53

2012 3 3990 4330 8,320 53

2012 4 1883 1797 3,680 23

Annual 

Totals 13,638 14,332 27,970 45

2013 1 1909 1573 3,482 23

2013 2 1652 1583 3,235 21

2013 3 1539 1616 3,155 20

2013 4 1333 1416 2,749 17

Annual 

Totals 6,433 6,188 12,621 20
Appendix B

Page 5 of 5

Tupelo, Mississippi

Quarter Year Deplanements Enplanements

Total 

Traffic

Enplanements 

per Day

2010 1 2267 2275 4,542 29

2010 2 2940 3103 6,043 39

2010 3 3508 3631 7,139 45

2010 4 2936 2998 5,934 38

Annual 

Totals 11,651 12,007 23,658 38

2011 1 2593 2687 5,280 34

2011 2 2895 3164 6,059 39

2011 3 2690 2938 5,628 36

2011 4 2663 2818 5,481 35

Annual 

Totals 10,841 11,607 22,448 36

2012 1 2024 2132 4,156 27

2012 2 2128 2310 4,438 28

2012 3 1949 1949 3,898 25

2012 4 1382 1323 2,705 17

Annual 

Totals 7,483 7,714 15,197 24

2013 1 1353 1319 2,672 17

2013 2 1696 1434 3,130 20

2013 3 1469 1462 2,931 19

2013 4 1489 1505 2,994 19

Annual 

Totals 6,007 5,720 11,727 19
Appendix C

Essential Air Service to be Maintained at Muscle Shoals, Alabama, Greenville, 

Laurel/Hattiesburg, Meridian, and Tupelo, Mississippi

Effective Period: August 7, 2014, until further Department action

Hub airport served: Hartsfield-Jackson Atlanta International Airport (ATL)

Scheduled Service1: 12 weekly nonstop round trips to Muscle Shoals

12 weekly one-stop round trips to Greenville

 12 weekly nonstop round trips to Hattiesburg

 13 weekly nonstop round trips to Meridian

 12 weekly nonstop round trips to Tupelo

Aircraft: 34-passenger Saab 340

 

 1 Greenville and Tupelo negotiated a lower level of service in Order to improve reliability of Silver’s operation. We 

expect Silver to maintain service at that level.
Appendix D

Example of General Terms and Conditions for Essential Air Service

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 these rates, 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 complete, 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 amounts 

or at the stipulated service levels, the carrier may cease to provide service to that specific location 

without regard 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.

Funds may not be available for performance under this Order beyond [DATE]. The Government’s 

obligation for performance under this Order beyond [DATE], is subject to the availability of 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 [DATE], until funds are made 

available to the Department for performance. If sufficient funds are not made available for 

performance beyond [DATE], the Department will provide notice in writing to the carrier.

Subsidy contracts 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.

All claims for payment, including any amended claims, must be submitted within 90 days of the 

last day of the month for which compensation is being claimed. For example, claims for service 

provided in July must be filed by October 31st; August claims must be submitted by November 30th, 

and so on.