Order: 2014-3-13

Served: March 21, 2014

 UNITED STATES OF AMERICA

 DEPARTMENT OF TRANSPORTATION

 OFFICE OF THE SECRETARY

 WASHINGTON, D.C.

Issued by the Department of Transportation

on the 21st day of March, 2014

Essential Air Service at

CHISHOLM/HIBBING, MINNESOTA DOCKET DOT-OST-2003-15796

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

ORDER SELECTING AIR CARRIER

Summary

By this Order, the Department is selecting SkyWest Airlines, operating as Delta 

Connection (SkyWest), to provide Essential Air Service (EAS) at Chisholm/Hibbing,

Minnesota (Hibbing), using 50-passenger Canadair Regional Jet CRJ200 (CRJ200) aircraft

to Minneapolis-St. Paul International Airport (Minneapolis) for the two-year term from 

June 1, 2014, through May 31, 2016 for an annual subsidy of $2,535,502. 

Background

By Order 2012-4-10 (April 6, 2012), the Department selected Delta Air Lines, Inc. (Delta) 

to provide 12 nonstop round trips per week from Hibbing to Minneapolis using CRJ200 

aircraft for a two-year period which is scheduled to expire on May 31, 2014, at an annual 

subsidy of $2,517,770.

1

 1 Hibbing’s contract start date was established to coincide when Great Lakes Aviation, Ltd. inaugurated 

service at Thief River Falls, Minnesota. Thief River Falls and Hibbing were traditionally packaged on one 

EAS order since both had been served by Mesaba Aviation, Inc., operating as Delta Connection. Great Lakes 

inaugurated service at Thief River Falls on May 18, 2012 and thus making the expiration date of Delta’s 

contract to serve Hibbing May 31, 2014.
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As the end of the contract was approaching, we issued Order 2013-11-24 

(November 26, 2013) requesting proposals from air carriers interested in providing EAS at 

the community for a new term. In response to that Order, SkyWest, the airline currently 

providing the service on behalf of Delta, was the only airline to submit a proposal.2

SkyWest’s complete proposal and the community’s comments may be accessed online at 

www.regulations.gov by entering DOT-OST-2003-15796 in the search block.

Proposal of SkyWest Airlines

SkyWest submitted a proposal for a two-year term for 12 weekly nonstop round trips to 

Minneapolis using CRJ200 aircraft for an annual subsidy of $2,535,502. It plans to 

operate the service as Delta Connection.

Community Comments

On January 8, 2014, the Department solicited comments from the community regarding 

this air carrier selection case. We received a joint letter from Shaun J. Germolus, 

Executive Director of the Chisholm-Hibbing Airport Authority (CHAA), The Honorable 

Rick Cannata, Mayor of Hibbing and The Honorable Michael Jugovich, Mayor of 

Chisholm supporting SkyWest’s proposal to continue providing EAS at

Chisholm/Hibbing. The communities noted their particular support for SkyWest’s 

proposal to operate as a Delta Connection carrier, which gives passengers access to Delta’s 

frequent flyer program, SkyMiles; worldwide connections through Delta’s hub at 

Minneapolis; and the use of the CRJ200 aircraft.

Decision

Since SkyWest was the only air carrier to submit a proposal for Chisholm/Hibbing’s EAS

case, the community fully supports the carrier’s proposal and we find the service and 

subsidy levels to be reasonable, the decision to select them is clear.

We shall make this selection of SkyWest at Chisholm/Hibbing contingent upon the 

Department’s receiving properly executed certifications from the air carriers that they are

in compliance with the Department’s regulations regarding drug-free workplaces and 

nondiscrimination, as well as the regulations concerning lobbying activities.3

 2 This reflects a change from the previous Order in that SkyWest will be responsible for this service, rather 

than Delta, but will operate as Delta Connection, thus providing the community with virtually the same 

service it has been receiving under the previous contract. 3 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
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Carrier Fitness

49 U.S.C. §§ 41737(b) and 41738 require that we find an air carrier fit, willing, and able to 

provide reliable service before we may subsidize it to provide EAS. SkyWest is subject to 

the Department’s continuing fitness requirements, and no information has come to our 

attention that would cause us to question the air carrier’s fitness at this time. We have 

contacted the Federal Aviation Administration, and it has raised no concerns that would 

negatively affect our fitness findings. We therefore conclude that SkyWest is reliable and 

fit to conduct the operations proposed here.

This Order is issued under authority delegated in 49 CFR Part 1.25a(b).

ACCORDINGLY,

1. We select SkyWest Airlines to provide Essential Air Service at Chisholm/Hibbing, 

Minnesota, and establish the annual subsidy rate as described in Appendix C;

2. We direct SkyWest 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 

from the service date of this Order 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 carriers may forfeit its compensation for any claim that is not 

supported under the terms of this Order;

3. We find that SkyWest Airlines is fit, willing and able to operate as a certificated air 

carrier, and capable of providing reliable Essential Air Service at Chisholm/Hibbing;
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4. This docket will remain open pending further Department action; and

5. The Department will serve a copy of this Order on the Mayors of Chisholm and 

Hibbing, Minnesota, the Executive Director at Chisholm-Hibbing Airport Authority, and

SkyWest Airlines.

By:

SUSAN L. KURLAND

Assistant Secretary for

Aviation and International Affairs

(SEAL)

An electronic version of this document is available at

http://www.regulations.gov
Appendix A

AREA MAP

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

 
 Appendix B

SkyWest Proposal for EAS at Chisholm/Hibbing

 
Appendix C

SkyWest Airlines

Essential Air Service to be Provided at Chisholm/Hibbing, Minnesota

Effective Period: June 1, 2014, through May 31, 2016

Scheduled Service: 12 weekly nonstop round trips to Minneapolis

Aircraft: 50-passenger CRJ200

Rate per Eligible Flight: $2,0731

Weekly Ceiling: $49,7522

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 this rate, 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 service levels, the carrier may cease to provide service to that 

specific location without regards 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 contract 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 September 30, 2014. The Government’s obligation for 

performance under this Order beyond September 30, 2014, 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 September 30, 2014, until funds are made available to the Department for performance. If sufficient funds are 

not made available for performance beyond September 30, 2014, the Department will provide notice in writing to the carrier.

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 31; August claims must be submitted by November 30, and so on.

 1 Annual compensation of $2,535,502 divided by the 1,223 annual departures (24 weekly departures x 52 weeks x 

98 percent completion). 2 24 arrivals and departures per week multiplied by $2,073 per flight.