Order 2014

- 11

- 2

Served: November 5, 2014



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 5th day of November , 2014



### ORDER REQUESTING PROPOSALS

Summary

B y this Order, the Department is soliciting proposals from air carriers interested in providing

E ssential A ir S ervice (EAS ) at West Yellowstone, Montana, for a new contract term

, beginning

June 1

, 201 5 , with or without subsidy. Air c arriers should file their proposals no later than

December 18

, 2014

. (See Appendix A for a service area map.)

Background By Order 2013

- 5

- 4 (May 2

, 2013), By t his Order, the Department re

- selected SkyWest Airlines (“SkyWest”) to provide EAS at West Yellowstone, Montana, at an annual subsidy rate of $535,141, for the two summer seasons from June 1 throug h September 30, 2013, and June 1 through September 30, 2014. SkyWest operated 14 nonstop round trips to Salt Lake City International Airport using 30

- seat Embraer Brasilia (EMB

- 120) aircraft.

The complete public file for EAS at this community may be accessed online through the Federal Dockets Management System at: www.regulations.gov by entering docket number, DOT

- OST

2003

- 14626

, in the “SEARCH for: Rules, Comments, Adjudications or Supporting Documents : ”

field.

R equest for Proposals

As the current contract has ended , the Department is requesting proposals from air carriers interested in providing service at the above mentioned communities

, for a new contract term for one or more summer seasons beginning June 1 , 2015

, 1 with or without subsidy

. Air c arriers should file their proposals no later than December 18 , 2014

. After that date, our s taff will then

docket the proposals, thereby making them public, and direct each air carrier to serve a copy of

1 The summer season runs from June 1 through September 30 each year. Essential Air Service at

WEST YELLOWSTONE, MONTANA

Under 49 U.S.C. 41731 et seq

. Docket DOT

- OST

- 2003

- 14626- 2

-

its proposal on the civic parties and other applican ts. S hortly thereafter, we will provide a summary of the proposals to community officials and ask them for their final comments. We will give full consideration to all proposals filed in a timely manner. 2

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 air 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 or rejection are only an occasional exc eption to the rule.

The Department is 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. The Department expect s proposals t o 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, they might want to include proposed schedules as well a s supporting data for their subsidy requests, such as projected block hours, revenues and expenses. The Department strongly encourage s clear, well

- documented proposals that will facilitate their evalua tion by the affected community and the Department. 3

T he Department expects proposals that are co nsistent with what the community previously

receive d

, namely 14 nonstop round trips per week with 30

- seat aircraft, or 12 nonstop round trips per week with 50

- seat or larger aircraft, with service to Salt Lake City, or another suitable hub airport that provides numerous connecting opportunities to the nati onal air transportation system. The Department encourages proposals that meet these guidelines in an efficient manner. Carriers are also welcome to propose m ore 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 requireme nts that remain competitive

.

T he community and air carriers are encouraged to work together in advance of the due date for proposals to craft a service pattern that is desirable to the community and meets the operational

needs of the airlines.

2 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, as req uired by 49 U.S.C. § 41732, can be reliably provided without such compensation, we typically will not proceed with the carrier

- selection case. Instead, we simply rely on that carrier’s subsidy

- free service as proposed.

3 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) in terline 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 Appropriations Act, 2014, Public

Law No. 113

- 76, and continued in the Continuing Appropriations Resolution, 2015, Public Law No. 113

- 164, provides that when selecting a carrier to provide EAS, the Department may c onsider 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 sel ection Order as part of our authorization of subsidy for the selected service. Appendix C of this Order contains those general provisions.- 3

-

Service an d Traffic History Proposals should provide sufficient capacity to accommodate historical levels of traffic. In order to assist air carriers in developing traffic and revenue projections for their proposals, we have provided a summary of historical passeng ers in Appendix B. The Department e xpect s service

levels that are consistent with what the commu nity previously rece ived that offers access to the national air transportation system.

Filing Requirements Air carrier proposals should be submitted to the Department with all materials merged into a single document. The document will be published on www.regulations.gov and each page

should be formatted to be viewed o nline.

Other Carrier Requirements The Department is responsible for implementing various Federal statutes governing lobbying activities, drug

- free workplaces, and nondiscrimination. 4 Consequently, all air carrier s receiving Federal subsidy for EAS must certify that they are in compliance with Department regulations regarding drug

- free workplaces and nondiscrimination, and those air carriers whose subsidies exceed $100,000 over the life of the rate

- term must also certify that they are in compliance with the regulations governing lobbying activities. Because the Department is prohibited from paying subsidy to air carriers that do not submit these documents, all air carriers that plan to submit proposals involving subsidy should be aware that the sele cted air carrier will be required to complete the required certifications. Interested air carriers requiring more detailed information regarding these requirements should contact the Office of Aviation Analysis at (202) 366

- 5903. 5

Community and State Comments

The commu nity and State are welcome to submit comments at any time. We encourage prospective appl icants to contact the community before they submit their proposals so that they

c an 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 and ask

them to submit the ir final comments shortly after December 18 , 2014 , the due date for proposals.

This O rder is issued under authorit y delegated in 49 CFR Part 1.25a(b) and re

- delegated to the Director, Office of Aviation Analysis.

3 The regulations applicable to these area s are: (1) 49 CFR Part 20

-- 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; 49 CFR Part 27

-- Nondiscrimination on the basis of disability in programs and activities re ceiving or benefiting from Federal financial assistance; and 14 CFR Part 382

-

- Nondiscrimination on the basis of disability in air travel; and (3) 49 CFR Part 29

-- Government

- wide debarment and suspension (non

- procurement) and government

- wide requirement s for drug

- free workplace (grants).

4 The certifications are available online under “Reports and Publications” at http://www.dot.gov/policy/ aviation

policy/small

- community

- rural

- air

- service/essential

- air

- service

.- 4

-

ACCORDINGLY,

1. The Department request s that air carriers interested in providing E ssential A ir S ervice at West Yellowstone, Montana , submit their proposals, with or without subsidy requests, no later

than December 18 , 2014 . The proposals should be e

- mailed to: EAS@dot.gov with the title “Proposal to Provide Essential Air Service at West Yellowstone , Montana 6 ”

.

2

. Th is docket will remain open until further order of the Department; and

3

. The Department will serve copies of this Order on the Mayor of West Yellowstone, Montana, the Manager of Yellowstone Airport , and the service list for this docket

.

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

Aviation Economic Regulations, 14 CFR Part 385. 31(a) , must file such petitions within seven ( 7 ) days after the date of service of this O rder.

This O rder w ill be effective immediately, and the filing of a petition for review shall not preclude its effectiveness.

By:

TODD M. HOMAN

Director Office of Aviation Analysis
(SEAL)

An electronic version of this document is available at http://www.regulations.gov

5 Questions regarding filings in response to this O rder may be directed to Michael Gormas at (202) 366

- 1853 or michael.gormas@dot.gov

.Appendix A



## AREA MAP

Maps generated by the Great Circle Mapper

- copyright © Karl L. SwartzAppendix B

Pass e n ger Traffic at West Yellowstone

Source: Bureau of Transportation Statistics: Schedule T

- 100 CityMarketName_1 Airport_1 Year Month Enplaned Pax Deplaned Pax Grand Total

West Yellowstone, MT WYS 2012 6 1170 1014 2184

7 1366 1276 2642

8 1401 1440 2841

9 1092 1227 2319

2012 Total 5029 4957 9986

2013 6 1385 1101 2486

7 1383 1424 2807

8 1499 1476 2975

9 1170 1289 2459

2013 Total 5437 5290 10727

2014 6 1523 1307 2830

7 1627 1496 3123

8 1640 1612 3252

9 1126 1213 2339

2014 Total 5916 5628 11544App endix C

E xample of G e n e r a l T e r m s a nd C ondi t ions f or Es s e n t i a l A ir Se r v i c e

The air c a rr i e r un d er st a nds t h a t it m a y f o rfe it its c omp e ns a tion f or a n y f li g hts th a t it do e s not op era te in c o n f o r m a n c e with the t er ms a nd stipul a tions of the ra te Order

, i n c luding

the s er vi c e pl a ns outlin e d in the Order a nd a n y oth e r s i g ni f i c a nt e l e m e nts of the re qui re d

s er vi ce , without p r ior a p p r ov a l. The air c arr i e r und e r st a nds th a t a n a i r cr a f t t a k e

- o f f a nd

l a nding a t its s c h e du l e d d e stin a tion c onstitut e s a c ompl e t e d f li g ht; a bs e nt a n e x pl a n a tion

suppo r ting subsi d y e li g i b ili t y f o r a f l i g ht th a t h a s n ot b ee n c ompl e t e d, su c h a s cer t a in

w ea th e r ca n ce ll a tions, o n l y c ompl e t e d f li g hts a r e c onsid ere d e l i g ible f or su b si d y

. I n

a ddition, if the air carr i e r d o e s not s c h e dule or o p era t e its f li g hts in f ull c on f o r m a n c e with

the Order f o r a s i g ni f i ca nt p e r iod, it m a y j e op ar di z e its e nti r e subsi d y c l a im f or t he p er iod in qu e stion. I f the air c a rr i e r c ont e mpl a t e s a n y su c h c h a ng e s b e y ond the s c ope o f the

Order du r ing the a ppli ca ble p e r iod of th e se ra t e s, it must f i r st noti f y the O ff i c e of

Avi a tion An a l y sis in w r iti n g a nd r ece ive w r itt e n a pp r o v a l f r om the D e p a r tm e nt to be

e nsu re d o f f ull c omp e ns a tion. S hould c i rc umst a n ce s w ar r a n t , the D e p ar tm e nt m a y l o c a te

a nd s e l e c t a re pl a ce m e nt air c arr i e r to p r ovide s er vi c e on th e se r out e s. The air c a rr i e r

must c ompl e te a ll f li g hts th a t ca n b e s a f e l y op era t e d; f l i g hts th a t ov e rf l y points f o r l ac k of

t r a f f ic will not be c omp e ns a t e d. I n d e t er m i ning wh e t h e r subsi d y p a y m e nt f o r a d e v i a ting

f l i ght should be a djust e d or dis a llow e d, t he D e p a r tm e nt will c onsid e r the e x t e nt to whi c h

the g o a ls of the p r og ra m a r e m e t a nd the e x t e nt of acce ss to the n a tion a l a ir t ra nspo r t a tion

s y s t e m p r ovid e d to the c ommuni t y

.

I f the D e p ar tm e nt unil a t e ra l l y
, e ith e r p a r ti a l l y or c ompl e t e l y , t er min a t e s or re du ce s

p a y m e nts f or s e r vi c e or c h a ng e s s er vi c e r e qui re m e nts a t a sp ec i f ic lo c a tion p r ovid e d f or und e r this Order, th e n, a t the e nd of the p e r iod f or whi c h the D e p ar tm e nt d o e s m a ke

p a y m e nts in the stipul a t e d a mounts or a t the stipul a t e d s er vi c e l e v e ls, the air c a rr i e r m a y

cea se to p r ovide s er v i c e t o th a t sp ec i f ic lo c a tion without re g a r d to a n y r e qui re m e nt f or noti c e of su c h c e ss a tion. Those a djustm e nts in the l e v e ls of subsi d y a nd/or s er vi c e th a t

ar e mutu a l l y a g r ee d to in w r iting b y the D e p ar tm e nt a nd air ca r r i e r do not c on s titute a

tot a l or p ar ti a l re d u c tion or ce ss a tion of p a y m e nt.



### 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 may not be available for performance under this Order beyond [DATE]. The Government’s obligat ion 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 [DAT E], 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.

All claims for payment, including any amended c laims, 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

.