o 

OCT-eST--\<V\i»-12.0^ 

ULS. Department of 

Itansportdtion 

Office of the Secretary 

of Transportation 

Assistant Secretary 1200 New Jersey Avenue, SE 

Washington, DC 20590 

November 8, 2010 

The Honorable Herb Kohl 

United States Senate 

Washington, DC 20510 

Dear Senator Kohl: 

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Thank you for your letter of October 22 to Mr. Robert Letteney expressing concern about 

the Essential Air Service (EAS) carrier-selection process at Ironwood and 

Manistee/Ludington, Michigan. The EAS program is administered by the Department's 

Office of Aviation Analysis and falls under my purview. 

As you know, by Order 2010-9-26, September 27, the Department determined that the 

two applicants that submitted bids did not have the requisite operating authority 

necessary to provide EAS. As a result, the Department requested another round of 

proposals from air carriers interested in providing EAS at the two communities for a third 

time, due no later than October 18. At the request of one applicant and with support from 

the communities, the due date for proposals was extended until October 25. 

In response to the most recent request for proposals, we have received a total of five 

proposals, briefly outlined below: 

• Charter Air Transport to serve Milwaukee, Wisconsin, with 30-seat, pressurized 

turboprop aircraft; 

• Gulfstream International Airlines to serve Milwaukee utilizing 19-seat, 

pressurized turboprop aircraft; 

• Air Choice One, two options, to serve Chicago O'Hare International Airport 

utilizing 9-seat turboprop aircraft; 

• Seaport Airlines, two options depending on the hub served (Minneapolis and 

Milwaukee or Minneapolis and Detroit) utilizing 9-seat, pressurized turboprop 

aircraft; and 

• Chautauqua Airlines, d/b/a Frontier Airlines, to serve Milwaukee utilizing 37-seat 

jet aircraft. 

On October 26 my staff shared the details of the proposals with Mr. DuRay and solicited 

community conunents and preferences. We are aware that their preliminary position now 

is to favor Frontier Airlines. However, as the carrier-selection proceeding is competitive 
3-001 

The Honorable Herb Kohl 

Page 2 

and is currently under review by the Department, I am sure you understand that I carmot 

comment on the merits of the proposals. I assure you, however, that the Department-will 

fully consider all of the proposals, and make its award based on the selection criteria 

detailed in the governing statutes, including community views. I share the Airport 

Manager's interests in findmg a replacement carrier in a timely maimer. However, rest 

assured that oui* overall goal is to find the best fit for the community. 

As is our normal practice, I am placing a copy of your letter and my response in Docket 

DOT-OST-1996-1266 as a contact outside tihe record of this proceeding. If I can 

provide further information or assistance, please feel firee to call me. 

Sincerely yours. 

SuSan L. Kurland 

Assistant Secretary for 

Aviation and International Affairs 

Cc: Mr. Duane DuRay, Gogebic-Iron County Airport 

Mr. Ryan Rnocke, U.S. Senator Herb Kohl's Office, Madison, WI 
3-001 

01-Nov-10 

2010 Senate Report - Governmental Affairs Correspondence 

Control Sheet (MO), W85-328 

Control Number: 

Date DOT Received: 

Date DOT Entered: 

Member's Date: 

Member Last Name: 

Member First Name: 

Member Oreanization: 

Addressl 

Address2 

Citv: 

State: 

Zip 

Con.stituent File Name: 

Constituent Date 

Action Office: 

Subiect: 

Action Office Code: 

Due Date: 

Member Contact: 

Pending 

Member Contact Phone: 

Closed Date: 

Remarks: 

Direct Reolv/Comeback Cooy 

Coneressionai Affairs ( 

2010 -1300 

11/1/2010 

11/1/2010 

11/1/2010 

Kohl 

Herb 

United States Senator 

15 West Mifflin Street, Suite 312 

Madison 

WI 

53703 

DuRay, Duane 

Office of the Assistant Secretary for 

Transportation Policy 

Essential Air Service 

P-1 

11/29/2010 

Ryan Knocke 

Yes 

(608) 264-5338 

Yes 

Contact 
HERBERT KOHL 

WISCONSIN 

WASHINGTON Of FICE: 

330 HART SENATE OFFICE BUILDING 

WASHINGTON. DC 20S10 

2021 224-S4S3 

TOO.'2021224-4464 

hllpi.-.wvww.Mnate.gov^ ^hohf 

•«n.uor.kohl9l(Oht fl«nale.gov 

Mtxtteb ^tatc s peltate 

WASHINGTON, DC 20510-4903 

3-001 

COMMIHEES: 

APPROPRIATIONS 

JUOICIARV 

SPECIAL COMMITTEE 

ON AGING 

October 22. 2010 

Mr. Robert Leneney 

Deputy Assistant Secretary for Governmental Affairs 

U.S. Department of Transportation 

1200 New Jersey Avenue, SE 

Washington, D.C. 20590 

Dear Mr. Letteney: 

I am writing on behalf of my constituent, Mr. Duane DuRay, from Ironwood, Michigan 

who is the current manager of the Gogebic-Iron County Airport. Mr. DuRay is concerned about 

the current Essential Air Service bidding process and his airport's retention of service from 

Charter Air Transport. 1 have enclosed a copy of his correspondence for your information. 

1 would appreciate your review and investigation of the concerns expressed by my 

constituent. Any information that would assist me in responding to him would be greatly 

appreciated. 

Please inform my office of your findings and forward all correspondence to the attention 

of my staff assistant, Ryan Knocke. in my Madison Senate office. 

Thank you for your time and prompt attention to this matter. 

Sincerely, bmcereiy, A 

Rerb Kohl 

United States Senator 

HK:rk 

Enclosures 

MILWAUKEE OFF:CC 

•.VEST VVISCCNSir. AvEfiUE 

MILWAUKEE. ;VI S3:03 

14141 ;9T.44il 

T OO 1414^297 iHii 

MADISON OFFICE. 

I I WEST MIFFL'N STREET 

SUITE 312 

MAOlSQ^J. VVI M703 

<t'afli?;4-S33R 

EAU CLAIRE OFFICE 

ICJ GRAHAM AVEMJE 

SUITF ?06 

EAUCLAiRE WIS4:0t 

'7I&IB3? 8424 

PRINTED ON RECYCLED PAPER 

APPlETONO.-flCE 

4321 WEST COLLEGE AVENUE 

SUITE 235 

APPIETOM. IVIM914 

iMl'OI .•33-1640 

LACROSSE OFFICE 

4:!i STA/E STREET 

SUITE 202 

I ACnOSSE. WI i4<OI 

•tM) :9«-ci;45 
3-001 

Gogebic-Iron County Airport 

E5560 Airport Road SC r 3 0 . 

nOGEBIC-IRON AIRPORT BOARD ironwood. Michigan 49938 

Joseph Bonovetz, Chairman Phone; 906-932-3121 Duane R. DuRay, Manager 

Robert Berg Jim Oliver F/0<' 906-932-4401 Mindy Prenderville, Admin.Asst. LeRoy Kangas Donna Scorse 

Bob Morin Brian Tarro 

PauiMuiiard Johnwiiia e-mail: iwd@chartermi.net 

SEP 3 0 2010 

September 24,2010 

Senator Kohl 

330 Hart Senate Office Building 

Washington, DC 20510 

Dear Senator Kohl: 

I'm writing this letter to your office requesting any assistance available. As you may 

know, ovx airport is provided flights through the Essential Air Service (EAS) program 

and we are currently addressing issues related to our latest EAS bid. I feel the very 

survival of our airport relies on the outcome of this situation. 

A brief synopsis: 

Back in February 2010, the DOT put out a request for proposals (RFP) asking for bids to 

provide air service for Ironwood/Ashland, Wi., Iron Mountain, Manistee, and Escanaba, 

Michigan, In this request the DOT also synchronized these four airports with the belief of 

a single air carrier providing a bid to support all four airports. Fom- companies had 

provided bids in response to the DOT's RFP, Charter Air Transport (CAT) / Public 

Charter, Inc. (PI), Great Lakes Airlines and Sovereign Air; bids reflected service for all 

four cities while the remaining company, Mesaba Airlines only supported Escanaba and 

Iron Mountain with flights. Iron Mountain and Escanaba accepted the proposal from 

Mesaba Airlines and the DOT awarded the contract but Ironwood/Ashland and Manistee 

were still in need of a proposal to provide air service. With this scenario, the DOT had to 

request for new bids covering only Ironwood/Ashland and Manistee. 

June 4,2010, the DOT requested proposals to provide air service for Ironwood/Ashland 

and Manistee airports and had received only two proposals, from CAT /PI and 

Sovereign Air, With much deliberation from Ironwood/Ashland and Manistee, both' 

communities had requested the DOT accept the proposal provided through Charter Air 

Transport. 

As the DOT was preparing to award the two year contract for air service to CAT /PI, 

Great Lakes Airlines had infonned Mr. Dennis DeVany (DOT) of possible issues relating 

to CAT / PI and their legal ability to perform EAS fliglits. CAT / PI has vigorously 

debated the issues the DOT and the FAA have raised regarding EAS scheduled flights. 
X-101 lO.VOOl 

These continued delays with contract awarding and our current fliglit schedule in 

Ironwood has caused our airlines boardings to drop over fifty percent. Both Ironwood and 

Manistee have continued to support the C.\T / PI proposal knowing we need a change 

from our current situation. Our communities believe the needs, desires, and grovith 

potential will be met under the service CAT /PI would provide as a public charter. I feel 

the EAS system is struggling to maintain the cmrent structure and they should be willing 

to look at the CAT /PI proposal as a possible fix to some of the problems currently 

plaguing this program. Included in this packet are other documents that will further 

explam the structure of this propsal and how it would provide service that complies to all 

of the EAS requirements for your review. 

As asked earlier, we are requesting assistance with this issue. I would like to request a 

personal call from Senator Kohl, if possible, to: 

Ms. Christa Fomarotto (DOT) Phone: 202-366-4451; Email: christa.fomarotto@dot.gov 

She is the political appointee who 1 am told is being briefed on this issue and I beUeve 

she would be the most logical person who deals with EAS. 

Ms. Susan Kurland (DOT) Phone: 202-366-8822; Email: susan.kurland@.dot.gov 

She is the next higher level "policy" person. She is a lawyer with an airports backgrovmd 

and she worked aviation issues for the Obama campaign so she is going to be sensitive to 

political aspects. 

Mr. Robert Rivkin, General Counsel Phone: 202-366-4702 or 4713,. He was a Chicago 

director of transit and close personally to President Obama. We believe Mr. Rivkin may 

not be familiar enough in aviation regulatory law to critically evaluate what his staff 

presents him. Mr. Rivkin needs to hear the legal arguments that should be made in favor 

of a concept with potentially great economic value to EAS communities, at the same tune 

would reduce the federal budgetary costs. 

I would not be requesting such attention if I did not beUeve this to be in a critical stage 

for the communities affected. 

Thank you for your immediate attention of this urgent issue. 

Sincerely, 

Duane R. DuRay 

Airport Manager 

Gogebic-Iron County Airport 
3-001 

Charter Air Transport (CAT) and Public Charters, Inc. (PI) have presented proposals to Ironwood and Manistee 

airports in Michigan to provide twice daily weekday sen/ice (with one daily roundtrip on weekends) on a 30 seat 

Embraer Brasilia Turboprop aircraft including full flight attendant sen/ices and private airline lavatories. These 

services are superior to the Incumbent carrier that Is receiving subsidy under the Essential Air Service Program 

(EAS), which has submitted a 'no bid" for continued sen/ice with these communities which would enable them to be 

"held in" by DOT on a "cost plus" basis if they can eliminate any other qualified carrier. Charter Air Transport is a 

qualified carrier that currently tv^ce daily service into Atlantic City airport, without federal subsidy. DOT found that 

CAT was "fit" to provide these "scheduled services." 

Both Ironwood and Manistee support the proposal made by Charter Air Transport and Public Charters, Inc. to provide 

the intended service at each of the airports because It will link the communities to the hub airport Milwaukee (MKE) 

served by Southwest and Frontier Airlines. The proposed flights would be marketed as 'public charters' in the same 

way as CATs non-subsidized services. P1 has a revolutionary capability to sell tickets through the Global 

Distribution System (GDS), the automated ticket distribution outlets used by travel agents and online intemet 

providers like Travelocity. 

This unique ticketing capability would provide passengers from EAS communities with an ability to buy tickets and 

construct travel itineraries that are indistinguishable from ticketing options available from "scheduled air carriers' that 

operate large aircraft and long ago dropped out of EAS mari<ets. Congress intended that EAS subsidies provide the 

means for eligible communities to maintain their connection to the national air transportation system. The Charter AJr 

Transport / Public Charters, Inc. proposal provides multiple daily frequencies at fixed times by an air cam'er DOT has 

found fit to provide "scheduled services." The EAS proposal meets all the specific aircraft and sen/ice criteria that 

Congress specified for EAS subsidized services, (see attached 409 U.S.C. §41732). 

But because it would be marketed under public charter regulations, DOT is being told by Great Lakes Airiines, the 

incumbent carrier, that public charters do not meet the Intent of "scheduled air transportation service." The incumbent 

EAS carrier wants to block a public charter service option so it can continue to get federal money on a 'cost plus" 

basis that vi/ill increase the costs of the federal subsidy. The current EAS operator is providing less than adequate 

service with delays and cancellations without service fcr up to 2 consecutive days at a time. 

Common sense says 'scheduled air transportation" refers to any offering to transport passengers in acconjance with 

a published schedule that is held out to the public in advance for sale—something that is a shared characteristic of 

airiines' "schedules" or "flight schedules" offered as public charters." The only considerations that should matter is 

vi^ich proposal best satisfies the elements that Congress identified as defining the attributes of minimum EAS service 

eligible for subsidy. 

In this regard, the CAT/PC1 Proposal is cleariy superior and could be provided at a lower cost than the kinds of 

inferior services for which DOT has been paying EAS subsidies. Unless DOT exercises its legal prerogatives to 

promote innovative EAS ser^rice proposals, tlie future of EAS is bleak. A number of communities are now served with 

9 seat aircraft that do not meet the statutory definition for minimum EAS service (which expressly requires use of 

aircraft with 15 seats or more) because the community was forced to waive because there was no other willing 

service provider. These small aircraft operate under less stringent safety standards. DOT also permits EAS carriers 

todstiver passengers to FBOs (general aviation terminals without TSA screening)—not even connecting them with 

the airport terminals. Several cunrent EAS operators sell tickets only on their own websites, providing no access to 

the traditional scheduled service ticketing outlets that Charter Air Transport and Public Charters, Inc. can provide. 

DOT should exercise Its legal interpretive discretion to authorize public charter service that exceeds the statutory 

minimum and provides a level of service that the communities regard as a superior form of "scheduled service." EAS 

communities should have the right to decide that a proposed service meets their needs. We oppose legal 

maneuvering by incumbent cam'ers to perpetuate higher costs and bad service—that is not the kind of support our 

communities want from DOT. 
3-001 

49 us e Title VII SUBCHAPTER II~SMALL COMMUNITY AIR SERVICE 

Sec. 41732. Basic essential air service 

(a) General.—Basic essential air service provided under section 

41733 of this title is scheduled air transportation of passengers and 

cargo — 

(1) to a hub airport that has convenient connecting or singleplane air service to a substantial number of destinations beyond 

that airport; or 

(2) to a small hub or nonhub airport, when in Alaska or when the 

nearest hub airport is more than 400 miles from an eligible place. 

(b) Minimum Requirements.—Basic essential air service shall include 

at least the following: 

(1)(A) for a place not in Alaska, 2 daily round trips 6 days a 

week, with not more than one intermediate stop on each flight; or 

(B) for a place in Alaska, a level of service at least equal to 

that provided in 1976 or 2 round trips a week, whichever is greater, 

except that the Secretary of Transportation and the appropriate 

State authority of Alaska may agree to a different level of service 

after consulting with the affected community. 

(2) flights at reasonable times considering the needs of 

passengers with connecting flights at the airport and at prices that 

are not excessive compared to the generally prevailing prices of 

other air carriers for like service between similar places. 

(3) for a place not in Alaska, service provided in an aircraft 

with an effective capacity of at least 15 passengers if the average 

daily boardings at the place in any calendar year from 1976-1986 

were more than 11 passengers unless--

(A) that level-of-service requirement would require paying 

compensation in a fiscal year under section 41733(d) or 41734(d) or 

(e) of this title for the place when compensation otherwise would not 

(B) the affected community agrees with the Secretary in 

writing to the use of smaller aircraft to provide service to the 

place. 

(4) service accommodating the estimated passenger and property 

traffic at an average load factor, for each class of traffic 

considering seasonal demands for the service, of not more than — 

(A) 50 percent; or 

(B) 60 percent when service is provided by aircraft with 

more than 14 passenger seats. 

(5) service provided in aircraft with at least 2 engines and 

using 2 pilots, unless scheduled air transportation has not been 

provided to the place in aircraft with at least 2 engines and using 

2 pilots for at least 60 consecutive operating days at any time 

since October 31, 1978. 

(6) service provided by pressurized aircraft when the service is 

provided by aircraft that regularly fly above 8,000 feet in 

altitude. 

(Pub. L. 103-272, Sec. 1(e), July 5, 1994, 108 Stat. 1144.) 
3-001 

Gogebic-Iron County Airport 

E5560 Airport Road 

GQGEBIC-rRON AIRPOR T BOAR D Ironw^ood, Michigan 49938 

Joseph Bonovetz, Chairman Phone: 906-932-3121 Duane R. DuRay, Manager 

Robert Berg Jim Oliver PAY- onfi Q'^9«ddni Mindy Prenderville, Admin.Asst. 

LeRoy Kangas Donna Scorse f^'^- aUb-yjii-44U1 

Bob Morin Brian Tarro 

PauiMuiiard JohnWilta e-mail: iwd@chartermi.net 

October 12, 2010 

Senator Kohl 

14 West Mifflin Street, Suite 207 

Madison, WI 53703 

Dear Senator Kohl: 

The Gogebic-Iron County Airport had recently contacted your office in regards to the 

Essential Air Service (EAS) bids and the decision of the Department of Transportation 

(DOT) to reject a proposal from Charter Air Transport (CAT) to provide air service to the 

Gogebic-Iron County Airport. 

Enclosed are "Airline Performance Reports" based on the service currently being provided to 

the Gogebic-Iron County Airport by Great Lakes Aviation. Please take the time to review 

these reports and take note of the consistent decrease in anivaJs and departures and the 

decrease in ridership through the years. In 2007 and 2008, the Gogebic-Iron County Airport 

had Midwest Airlines as an air service provider and offered early morning departures from 

Ironwood and late night arrivals into Ironwood. This schedule allowed our local btisinesses to 

utilize our local airport; with the current schedule, our local businesses are forced to use outof-town airports or other forms of transportation. 

Thank you for your time, consideration and support in this very important issue. 

Sincerely, 

Duane R. DuRay 
a

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