1 

### Schlemmer, Kevin (OST)

From: Schlemmer, Kevin (OST)

Sent: Monday, July 16, 2012 4:34 PM

To: 'Terry M Moore (tm@flymov.com)'; 'Thomas C. Frungillo (tom@bradfordairport.net)';

'bob@dujairport.com'; 'Tim Dills'; 'Otho Bell (obell@co.venango.pa.us)'

Cc: 'joel@transportazumah.com'; 'Mickey Bowman'; 'drichardson@gosilver.c om'; Devany, Dennis

(OST)

Subject: FW: EAS proposals for BFD, DUJ, FKL, JHW, and PKB

One correction: The total combined amount for Silver’s subsidy request is $10,348,117, not $13,267,470.

From: Schlemmer, Kevin (OST)

Sent: Wednesday, July 11, 2012 5:31 PM

To: 'Terry M Moore (tm@flymov.com)'; 'Thomas C. Frungillo (tom@bradfordairport.net)'; 'bob@dujairport.com'; 'Tim

Dills'; 'Otho Bell (obell@co.venango.pa.us)'

Cc: 'joel@transportazumah.com'; 'Mickey Bowman'; 'drichardson@gosilver.com'; Devany, Dennis (OST)

Subject: RE: EAS proposals for BFD, DUJ, FKL, JHW, and PKB

Please find the following letter from Dennis DeVany. Comments are due August 8, 2012.

Regards,

Kevin

******************************************************************************

To Whom it Concerns:

I would like to update you on the Essential Air Service (EAS) situation at Bradford, DuBois, Franklin/Oil City

(“Franklin”), Jamestown, and Parkersburg/Marietta (“Parkersburg,”) and give you an opportunity to submit any

comments if you wish. As you know, by Order 2012

‐ 5

‐ 12, May 9, 2012, the Department solicited proposals from all

interested air carriers to provide service at all five communities, for a new term beginning October 1, 2012. Proposals

were also requested for Kirksville, Missouri, but we are working with that community separately. Proposals for service

were due June 7, 2012, but Silver Airways (“Silver”) requested two extensions. The second extension revised the due

date to June 29, 2012.

In response to that Order, we received proposals from Silver Airways (“Silver”), the incumbent and

TransportAzumah. Copies of both proposals are attached to this e

‐ mail.

Silver proposes to continue its status

‐ quo service operating to Cleveland Hopkins International Airport (CLE) at all five

communities: four nonstop or one

‐ stop round trips at DuBois (24 per week), four nonstop round trips at Parkersburg (24

per week), three nonstop or one

‐ stop round trips at Bradford and Jamestown (18 per week each), and two nonstop or

one

‐ stop trips at Franklin (12 per week) for a combined annual subsidy of $13,267,470, over a two

‐ year term. Service

would utilize Beech 1900D turboprop aircraft and would continue to operate under a codeshare agreement with United

Airlines. Silver proposes this service as “all

‐ or

‐ nothing” with the award of all five cities required. Please note that Silver

requests the ability to suspend service after 120 days’ notice.

TransportAzumah proposes ground transportation options for Bradford, Jamestown, DuBois, and Franklin, utilizing a

passenger bus at no cost to passengers. Bradford would receive three daily round trips and Jamestown would receive

four daily round trips, to Buffalo Niagara International Airport (BUF) for annual subsidy amounts of $832,000, and

$876,000, respectively. DuBois would receive four daily round trips and Franklin would receive three daily round trips,

to Pittsburgh International Airport (PIT) for annual subsidy amounts of $1,226,400, and $814,680, respectively.2 Please note that the average passenger fares shown in the proposal do not necessarily reflect the average local fare

Kirksville passengers would actually pay, but, rather, reflect a prorated portion of the total ticket price, e.g., the DuBois

–

Cleveland of a DuBois

– Cleveland

– Los Angeles ticket that the subsidized carrier would realize. In addition, the fare

shown is net of certain charges such as Federal transportation security fees, excise or ticket taxes, and Passenger Facility

Charges. Of course, carriers have the discretion to charge fares they deem appropriate, and the passenger fares

presented in their proposals have been developed for subsidy rate computation purposes only. Based on the cost

elements incorporated in the carrier’s computation summaries, Cape Air would have to realize passenger fares

comparable to the averages shown in their proposals in order to achieve break

‐ even or profitable operations without

subsidy.

You should also note that the schedule that the carrier has submitted is illustrative only, and that they may make

schedule changes to reflect changing conditions, e.g., to better meet shifting connecting bank times at the hub. The

Department expects subsidized air carriers to maintain well

‐ timed and well

‐ spaced flights in order to ensure full

compensation.

We ask that you submit any comments by August 8, 2012. We will carefully consider your comments before we

submit a recommendation to the Assistant Secretary for a decision. Should you have any questions or need additional

time to draft your comments, please let us know.

Please send your comments via e

‐ mail to EAS@dot.gov or by fax to 202

‐ 366

‐ 7638. If you have any questions, please

feel free to contact Kevin Schlemmer of my staff at kevin.schlemmer@dot.gov or 202

‐ 366

‐ 3176.

Sincerely,

Dennis J. DeVany

Chief, Essential Air Service Division, X

‐ 53

Office of Aviation Analysis