Order: 2011-1-16

Served: January 22, 2011

 UNITED STATES OF AMERICA

 DEPARTMENT OF TRANSPORTATION

 OFFICE OF THE SECRETARY

 WASHINGTON, D.C.

Issued by the Department of Transportation

on the 18th day of January, 2011

ORDER GRANTING A PETITION FOR RECONSIDERATION, SELECTING A 

CARRIER AND SETTING FINAL SUBSIDY RATES

Summary

By this order, the Department is: 1) granting the petition of Charter Air Transport, Inc., in 

cooperation with Public Charters, Inc. (hereinafter referred to as Charter J/V), to reconsider 

Order 2010-9-26 and affirming our findings in that order; and 2) selecting Chautauqua 

Airlines, Inc. d/b/a Frontier Airlines (Frontier), a wholly owned subsidiary of Republic 

Airways Holdings, Inc., to provide subsidized essential air service (EAS) at Ironwood,

Michigan/Ashland, Wisconsin (Ironwood), and Manistee/Ludington, Michigan (Manistee). 

Service will be provided with 37-seat Embraer 135 aircraft for a two-year period beginning 

when the carrier inaugurates service through the end of the 24th month thereafter, at a 

combined annual subsidy rate of $3,082,383.1 (See Appendix A for a map.)

Background

By Order 2008-4-10, April 7, 2008, the Department selected Great Lakes Aviation, Ltd. 

(Great Lakes), to provide subsidized EAS at Ironwood and Manistee utilizing 19-seat Beech 

1900D aircraft for a new two-year term beginning when it inaugurated full service. Under 

that order, Great Lakes provides Ironwood with two daily one-stop (at Rhinelander, 

Wisconsin) round trips to Milwaukee for an annual subsidy rate of $1,492,865. Great Lakes 

provides Manistee with two daily nonstop round trips to Milwaukee for an annual subsidy of 

$1,799,395, or a combined annual subsidy rate of $3,292,260. Great Lakes commenced 

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

Essential Air Service at

IRONWOOD, MICHIGAN/ASHLAND, WISCONSIN

MANISTEE/LUDINGTON, MICHIGAN

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

Docket DOT-OST-1996-1266

Docket DOT-OST-1996-1711
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service at the two communities on May 5, 2008, meaning that the contract was originally 

scheduled to expire on May 31, 2010.

In anticipation of the end of the rate terms and in order to attract as many applicants as 

possible, the Department issued Order 2010-2-18 on February 19, 2010, synchronizing the 

contract end dates at the two communities with two additional EAS communities in 

Michigan – Iron Mountain/Kingsford and Escanaba.

On June 4, by Order 2010-6-4, the Department selected Mesaba Airlines to serve Iron 

Mountain/Kingsford and Escanaba and requested proposals from carriers interested in 

providing EAS at Ironwood and/or Manistee only, for a new two-year term.

In response to Order 2010-6-4, Charter J/V and Sovereign Air, Inc., submitted proposals to 

provide EAS at the two communities. In response to the Department’s July 7 solicitation of 

community preferences and comments on the proposals received, both communities, while 

acknowledging Charter J/V’s lack of code-share and marketing agreements, unanimously 

supported selection of the carrier. However, by Order 2010-9-26, September 27, 2010, the 

Department: 1) determined that the two applicants did not have the requisite operating 

authority necessary to provide EAS; and 2) requested a third round of proposals for EAS at

Ironwood and/or Manistee only, due no later than October 18. On October 15, 2010, in 

response to the request of Alaska Juneau Aeronautics, Inc. d/b/a/ SeaPort Airlines (SeaPort),

and with the support from both communities, the Department extended the due date for 

proposals to October 25.

On October 20, Charter J/V, with support from Ironwood and Manistee, filed a Petition for

Reconsideration of Order 2010-9-26, arguing the Department adopted a restrictive legal 

interpretation of the phrase “scheduled air service.” We will address their petition below.

Proposals

In response to Order 2010-9-26, five carriers submitted proposals: Charter J/V, Gulfstream 

International Airlines, Inc. (Gulfstream), Air Choice One Airlines (Air Choice), SeaPort, and 

Frontier.

Copies of the proposals and community comments may be accessed online through the 

Federal Docket Management System at: http://www.regulations.gov, by doing a search on 

the docket numbers listed on the first page. Each carrier’s proposal is briefly summarized 

below.

Charter J/V

Similar to its previous proposal, Charter J/V’s bid is a cooperative effort between Public 

Charters, Inc. and Charter Air Transport, Inc. Ticketing, reservations, and other customer 

services would be provided by Public Charters, Inc., while Charter Air Transport, Inc. would 

operate the flights. EAS at the two communities would be provided by Charter J/V as public 

charters under 14 CFR Part 380 of the Department’s aviation regulations.

Charter J/V submitted an inseparable two-city package (due to aircraft routing) bid for 

service to Milwaukee with 30-passenger Embraer 120 aircraft. Specifically, Charter J/V 
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would provide each community 12 one-stop or nonstop round trips a week for an annual 

subsidy of $3,584,329. Charter J/V states that it is currently pursuing an interline agreement 

with Frontier Airlines at Milwaukee.

Gulfstream

Gulfstream submitted a package (“all or nothing”) bid for service between each community 

and Milwaukee utilizing 19-passenger Beech 1900D aircraft. Gulfstream would provide 

each community 12 nonstop round trips a week for a combined annual subsidy of $4,732,526 

($3,035,408 at Ironwood and $1,988,710 at Manistee). Gulfstream has maintained ticketing 

and baggage interline agreements with legacy carriers in several other large airports and 

states that it has begun code-share discussions with potential partners at Milwaukee.

Air Choice

Air Choice, utilizing 9-seat Cessna Caravans, submitted a proposal with six service options 

(summarized below), all with nonstop service to Chicago O’Hare International Airport.

Service 

Option #

Weekly 

Round 

trips

Annual 

Subsidy 

Required

Ironwood Options

1 18 $2,793,074

2 21 $3,071,607

Manistee Options

1 18 $2,360,686

2 24 $2,607,032

3 28 $2,967,621

Combined Manistee and Ironwood Option

1 21 $5,215,760

The carrier has recently signed an interline ticketing and baggage agreement with United 

Airlines.

SeaPort

SeaPort would utilize 9-seat Pilatus PC-12 aircraft and would operate from the business 

aircraft centers at Milwaukee, Minneapolis and Detroit with complimentary shuttle service to 

and from the main terminal for connecting passengers. For Ironwood, SeaPort proposed 12

nonstop round trips per week to Minneapolis and 6 one-stop round trips a week to 

Milwaukee or Detroit for a first-year rate of $2,766,041 and a second-year rate of 

$2,788,390. At Manistee, the carrier proposed to provide 12 nonstop round trips per week to 

Milwaukee and Detroit for a first-year subsidy of $2,975,723 and a second-year rate of 

$2,984,437. Thus, the combined annual subsidy rates for both communities is $5,741,764 for 

the first-year and $5,772,827 the second. SeaPort’s proposal includes mention of an interline 

agreement with US Airways; however, the details and applicability of the agreement at the 

hubs proposed are not discussed.
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Frontier

Frontier submitted a two-city package bid to provide service between each community and 

Milwaukee utilizing 37-passenger Embraer 135 aircraft (with the flexibility to substitute 50-

seat Embraer 145 aircraft for the same annual subsidy). Specifically, Manistee would receive 

12 nonstop round trips a week for an annual subsidy of $1,694,794. The carrier would 

provide Ironwood 12 one-stop (at Rhinelander or Wausau/Stevens Point, Wisconsin) round 

trips a week for an annual subsidy of $1,387,589. The combined annual subsidy for both 

communities would be $3,082,383. Frontier also requested that the Department and two 

communities waive the right to hold-in Frontier upon a 180-day notice to terminate service.

Community Comments

On October 26, the Department solicited the views of both communities.

On November 9, we received letters from the airport managers of both communities stating 

that their respective Airport Boards, in unanimous votes, endorsed Frontier and agreed to 

waive any hold-in requirements upon 180-day notice.

The Manistee County Blacker Airport Authority made a back-up recommendation of Charter 

J/V. Ironwood’s letter also made mention of a community member’s suggestion to consider 

Charter J/V as a viable option for air service.

Decision On Carrier Selection

After careful consideration of all the facts of this case, including the comments of local 

officials, the Department has decided to select Frontier to provide EAS at both communities, 

in accordance with its proposal.

At both communities Frontier’s proposal meets all of the statutory carrier-selection criteria. 

Its operation provides the communities same-carrier connections to more than 30 domestic 

nonstop destinations at Milwaukee. The carrier also has full interline agreements with most 

major airlines, which will provide additional “seamless” options to Milwaukee travelers. 

Both communities support Frontier’s proposal, and it requires the least subsidy of all the 

options. Further, we find that both the service and subsidy levels are reasonable.

Frontier will provide 12 nonstop round trips a week between Manistee and Milwaukee for an 

annual subsidy of $1,694,794. Between Ironwood and Milwaukee the carrier will provide 12 

one-stop (at Rhinelander or Wausau/Stevens Point) round trips a week for an annual subsidy 

of $1,387,589. Service at the two communities will be provided utilizing 37-seat, Embraer 

135 aircraft (or 50-seat, Embraer 145 aircraft). The combined annual subsidy rate is 

$3,082,383.

The Department fully expects passenger traffic to grow at both communities, and that the 

communities and Frontier will work together to ensure the sustainability of the continuation 

of the proposed service levels.

The Department shall make this selection at both communities contingent upon the 

Department’s receiving properly executed certifications from Frontier that it is in compliance 
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with the Department’s regulations regarding drug-free workplaces and nondiscrimination, as 

well as the regulations governing lobbying activities.

Compensation for Interim-Period Service

During this long carrier-replacement case, we will require the incumbent carrier, Great 

Lakes, to continue providing service until replacement service begins. Great Lakes is 

eligible to be compensated for the provision of EAS at the two communities until a 

replacement carrier inaugurates full EAS operations at the communities. Thus, pursuant to 

49 U.S.C. § 41734(d), the Department will continue to compensate Great Lakes at the 

subsidy amounts set in Order 2008-4-10.

We expect Great Lakes and Frontier to work together to make a smooth transition at the two 

communities. In that regard, before Great Lakes suspends its service, we expect it to contact 

all passengers holding reservations for travel after its final date of service, to inform them of 

the change in service, and to assist them in arranging alternate transportation or to provide a 

refund of the ticket price, without penalty, if requested.

Carrier Fitness

49 U.S.C. § 41737(b) requires that we find an air carrier fit, willing, and able to provide 

reliable service before we may subsidize it to provide essential air service. Frontier 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 contacted 

the Federal Aviation Administration (FAA), and it has raised no concerns that would 

negatively affect our fitness finding. We therefore conclude that the carrier remains fit to 

conduct the operations proposed here.

Charter J/V’s Petition for Reconsideration

As mentioned above, Charter J/V, with support from Ironwood and Manistee, filed a Petition 

to reconsider Order 2010-9-26 with the Department on October 20. Charter J/V states that 

the proposal it submitted in response to Order 2010-6-4 met or exceeded the service criteria 

that Congress established for basic essential air service.

In its petition, Charter J/V requested that the Department: (1) reconsider its decision in 

Order 2010-9-26; (2) reverse Order 2010-9-26 and find Charter Air Transport, Inc. eligible to 

provide EAS service as regularly scheduled public charter operations; or, alternatively, (3) 

declare that an EAS community may waive or request an exemption from the “scheduled 

service” requirement and allow subsidy payments to be made to public charter flights that would 

otherwise meet the requirements of basic essential air service; and (4) proceed without delay to 

select Charter J/V’s new EAS proposal in response to the latest request for proposals.

In support of its request, the carrier makes four major arguments. First, as background, 

Charter J/V restates several key findings documented in a recent Government Accountability 

Office (GAO) report on small community air service, including the lack of carriers currently 

participating in the EAS program. Consistent with the report, the petitioner restates the 

GAO’s recommendation that the Department evaluate other forms of air service that might 

better serve communities. The carrier argues that its Transportation Security Administration 

Secure Flight compliant service, utilizing 30-seat, pressurized aircraft and marketed through 
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the internet, would offer more comfort and convenience to passengers when compared to 

EAS carriers using 9-seat aircraft (which may not operate from an airport’s main commercial 

airline terminals), and Charter J/V offers quality access to the nation’s air transportation 

network. Second, Charter J/V contends that the Department’s interpretation of basic EAS in 

Order 2010-9-26 is incorrect. The carrier notes that the Department acknowledged that 

Charter J/V could provide service as it proposed in response to Order 2010-6-4 (i.e., as public 

charters operated pursuant to a published schedule with 30-seat aircraft), but that the service 

cannot be subsidized by the EAS Program. The petitioner insists that the Department’s 

interpretation of basic essential air service requirements deprives EAS communities the 

opportunity to obtain air service that can be provided in non-subsidized markets. The carrier 

also explains how its interpretation of several other important aviation and safety regulations 

and definitions differs from the Department’s findings documented in Order 2010-9-26. 

Charter J/V maintains that public charter air service operated according to a published 

schedule should not be precluded as a means of subsidized EAS if that service meets or 

exceeds all required EAS service requirements. Third, Charter J/V claims that the 

Department has the authority to grant a waiver or exemption to allow a community to receive

subsidized EAS via public charter air service, if it is in the public interest (or if the 

community is willing to waive its rights to basic essential air service). The carrier

summarizes the precedents of EAS communities’ waiving their rights to the minimum EAS 

service attributes, including aircraft operated by twin-engine and two-pilots, 15-seat aircraft, 

and carrier hold-in requirements, and asserts that if the community is willing to accept public 

charter air service and waive its right to basic essential air service requirements, the 

Department similarly should be willing to accept such service under the EAS program. 

Lastly, Charter J/V emphasizes that its proposed service is consistent with the public interest

in that both Ironwood and Manistee fully supported Charter J/V’s proposal. The carrier 

reiterates that its proposed charter service is superior to that provided by EAS carriers that

operate 15-seat or less aircraft and could bolster service provided to EAS communities.

Community Comments

Both Ironwood and Manistee supported Charter J/V’s Petition for Reconsideration, but 

expressed no opinions on the Department’s interpretation of basic EAS requirements. 

However, in a manner similar to that discussed in Charter J/V’s Petition, both communities 

noted several examples where, at the specific request of EAS communities, the Department 

has waived basic essential air service requirements and selected (and pays subsidy) to the 

carrier recommended by the community. In support of the Petition, both communities

affirmatively waived their rights to “scheduled air service” and specifically asked the 

Department for clarification on whether subsidized EAS could be provided by public charter 

air service operated according to a published schedule (by waiver or exemption) if the 

communities supported the service.

Decision on Charter J/V’s Petition for Reconsideration

We have decided to grant Charter J/V’s Petition for Reconsideration and, upon 

reconsideration, we affirm our findings in Order 2010-9-26.

Charter J/V fails to meet the EAS Program requirements because it does not hold authority 

from the Department and the FAA to operate 30-seat aircraft in scheduled operations. 

Congress established the framework of the EAS program in 49 U.S.C. §41732(a), which 
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states, “GENERAL.-Basic Essential Air Service provided under section 41733 of this title is 

scheduled [emphasis added] air transportation of passengers and cargo...” The company 

currently holds economic authority from the Department to conduct operations pursuant to 

14 CFR Part 135.2 That authority allows the company to provide scheduled air service with 

9-seat or smaller, non-turbo-jet aircraft, and public charter service with up to 30-seat aircraft, 

under 14 CFR Part 380. Public charter operations are not by definition, scheduled 

operations.3 However, Charter J/V’s proposal is to operate 30-seat Embraer Brasilia aircraft, 

for which it does not possess the requisite DOT or FAA authority to operate in scheduled air 

transportation. 4

Charter J/V argues that the communities effectively waived their rights to scheduled air 

service and would agree to charter service. Charter J/V further argues that other EAS 

communities have waived other features of the EAS program, e.g., some communities prefer 

more frequent service with 9-seat aircraft rather than 15-seat aircraft as guaranteed to most 

communities. We disagree. As we mentioned above, the very framework of the program is 

established in 49 U.S.C. §41732(a) and requires scheduled air service. The exemptions to 

which Charter J/V refers are contained in 49 U.S.C. §41732(b), and are service minimums 

designed to protect the community, and communities have from time to time effectively 

exempted themselves from those minimum service requirements. Congress did not list 

scheduled service as one of the minimum service requirements specified in 

49 U.S.C. §41732(b), but instead included it as part of the basic definition of the program. 

Consequently, we are not able to allow communities to rewrite the framework of the EAS 

program by exempting them from the basic requirement that all essential air service be 

provided by scheduled operations.

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

ACCORDINGLY,

1. We select Chautauqua Airlines, Inc. d/b/a Frontier Airlines, to provide essential air 

service at Ironwood, Michigan/Ashland, Wisconsin, and Manistee/Ludington, Michigan, as 

described in Appendix C, for a two-year period beginning when the carrier inaugurates service 

through the end of the 24th month thereafter;

2. The Department directs Chautauqua Airlines, Inc. d/b/a Frontier Airlines, 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 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;

 2 See Order 2010-3-8, issued March 8, 2010, in Docket DOT-OST-2009-0187.

3 See 14 CFR §§ 119.3, 380.2.

4 Our determination in this case does not impact the carrier’s ability to provide service under Part 380 in a 

context other than EAS.
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3. We find that Chautauqua Airlines, Inc. d/b/a Frontier Airlines, continues to be fit, willing 

and able to operate as a certificated air carrier and capable of providing reliable essential air 

service at Ironwood, Michigan/Ashland, Wisconsin, and Manistee/Ludington, Michigan;

4. Under our authority in 49 U.S.C. § 40109, we will allow Chautauqua Airlines, Inc. d/b/a 

Frontier Airlines to cease operations at Ironwood, Michigan/Ashland, Wisconsin, and 

Manistee/Ludington, Michigan, on 180 days’ notice to the Department and communities;

5. We will extend the annual subsidy rates and the rates per flight and weekly compensation 

ceilings set for Great Lakes Aviation, Ltd. in Order 2008-4-10, April 7, 2008, until Chautauqua 

Airlines, Inc. d/b/a Frontier Airlines inaugurates full EAS;

6. We grant Charter Air Transport, Inc.’s Petition for Reconsideration and, on the merits, 

affirm our findings in Order 2010-9-26;

7. These Dockets will remain open until further order of the Department; and

8. We will serve copies of this order on the parties listed in Appendix D.

By:

SUSAN L. KURLAND 

Assistant Secretary for

Aviation and International Affairs

(SEAL)

An electronic version of this document is available in the Federal Docket Management 

System (FDMS) at http://www.regulations.gov
Appendix A

AREA MAP
Appendix B

Page 1 of 2

Chautauqua Airlines, Inc. d/b/a Frontier Airlines

Provision of Essential Air Service at Ironwood, Michigan/Ashland, Wisconsin

Calculation of Compensation Requirement

Aircraft ERJ-135 (37-seats) or ERJ-145 (50-seats)

Mileage: 70 ASMs/Flight 2,590

Daily Departures: 4 Annual ASMs 3,442,110

Annual Departures: 1329 Annual RPMs 832,160

Block per Departure: 0.45 hours Load Factor 24.2%

Annual Block Hours: 598 hours Annual Seats 49,173

Annual Onboard Pax: 11,888 Fuel Cost per Gallon $2.50

Completion Percent: 98%

Revenue

Annual Pax 11,888

Average Segment Fare $87.83

Total Revenue $1,044,123

Expenses

System/Station Costs $1,792,780

Fuel Costs $523,136

Total Annual Expense $2,315,916

Profit/(Loss) ($1,271,793)

Profit Margin @5% $115,796

Subsidy Request $1,397,589

Subsidy/Departure $1,044.08

Subsidy/Pax $116.72
Appendix B

Page 2 of 2

Chautauqua Airlines, Inc. d/b/a Frontier Airlines

Provision of Essential Air Service at Manistee/Ludington, Michigan

Calculation of Compensation Requirement

Aircraft: ERJ-135 (37-seats) or ERJ-145 (50-seats)

Mileage: 123 ASMs/Flight: 4,551

Daily Departures: 4 Annual ASMs: 6,048,279

Annual Departures: 1329 Annual RPMs: 2,655,324

Block per Departure: 0.75 hours Load Factor: 43.9%

Annual Block Hours: 997 hours Annual Seats: 49,173

Annual Onboard Pax: 21,588 Fuel Cost per Gallon: $2.50

Completion Percent: 98%

Revenue

Annual Pax 21,588

Average Segment Fare $75.02

Total Revenue $1,619,531

Expenses

System/Station Costs $2,284,606

Fuel Costs $871,894

Total Annual Expense $3,156,500

Profit/(Loss) ($1,536,969)

Profit Margin @5% $157,825

Subsidy Request $1,694,794

Subsidy/Departure $1,275.24

Subsidy/Pax $78.50
Appendix C

Page 1 of 3

Chautauqua Airlines, Inc. d/b/a Frontier Airlines

Essential Air Service to Be Provided at Ironwood, Michigan/Ashland, Wisconsin

Effective Period Two years beginning when Frontier inaugurates service through 

the end of the 24th month thereafter.

:

Scheduled Service: 12 one-stop round trips to Milwaukee a week

Intermediate stops and upline

service: 

An intermediate stop at Rhinelander or Wausau/Stevens Point, 

Wisconsin is permitted.

No service to any other intermediate point is contemplated 

under the terms of the carrier’s proposal; accordingly, no such 

service may be provided on subsidized flights without prior 

Department approval.

Aircraft type: Embraer 135 (37-seats) or 145 (50-seats).

Timing of flights: Flights must be well-timed and well-spaced in order to ensure 

full compensation.

Annual compensation: $1,387,589

This rate assumes an annual completion factor of 98 percent. A 

compensation ceiling is to be applied per calendar week such 

that service above that ceiling in one week cannot make up for 

service shortfalls in another week.

Subsidy Rate per Flight: $1,130.881

Weekly Compensation Ceiling: $27,141.122

 1 $1,387,589 divided by 1,227 annual departures: 4 flights/day x 313 days x .98 (completion factor) =1,227.

2 24 flights per week multiplied by $1,130.88 per flight.
Appendix C

Page 2 of 3

Chautauqua Airlines, Inc. d/b/a Frontier Airlines

Essential Air Service to Be Provided at Manistee/Ludington, Michigan

Effective Period Two years beginning when Frontier inaugurates service through 

the end of the 24th month thereafter.

:

Scheduled Service: 12 nonstop round trips to Milwaukee a week

Intermediate stops and upline 

service: 

No service to any intermediate point is contemplated under the 

terms of the carrier’s proposal; accordingly, no such service 

may be provided on subsidized flights without prior 

Department approval.

Aircraft type: Embraer 135 (37-seats) or 145 (50-seats).

Timing of flights: Flights must be well-timed and well-spaced in order to ensure 

full compensation.

Annual compensation: $1,694,794

This rate assumes an annual completion factor of 98 percent. A 

compensation ceiling is to be applied per calendar week such 

that service above that ceiling in one week cannot make up for 

service shortfalls in another week.

Subsidy Rate per Flight: $1,381.253

Weekly Compensation Ceiling: $33,1504

 3 $1,694,794 divided by 1,227 annual departures: 4 flights/day x 313 days x .98 (completion factor) =1,227.

4 24 flights per week multiplied by $1,381.25 per flight.
Appendix C

Page 3 of 3

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 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 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 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.

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.

Funds are not currently available for performance under this order beyond March 3, 2011. The 

Department’s obligation for performance under this order beyond March 3, 2011, 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 

March 3, 2011, until funds are made available to the Department for performance. If funds are not 

made available for performance beyond March 3, 2011, 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.
Appendix D

SERVICE LIST

Mr. Duane DuRay

Manager

Gogebic - Iron County Airport

E5560 Airport Road

Ironwood, Michigan 49938

Mr. Gerald E. Edwards

Assistant Administrator, Aviation Services 

Division

Bureau of Aeronautics & Freight Services

Michigan Department of Transportation

Aeronautics Building

2700 Port Lansing Road

Lansing, Michigan 48906

Mr. Barry Lind

Manager

Manistee County Blacker Airport

2323 Airport Road

Manistee, Michigan 49960