Order 2013-4-7

Served: April 12, 2013

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 12th of April, 2013

Essential Air Service at

ADAK, ALASKA

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

DOCKET DOT-OST-2000-8556

ORDER REQUESTING PROPOSALS

Summary

By this Order, the Department is requesting proposals by May 9, 2013, from carriers 

interested in providing Essential Air Service (EAS) at Adak, Alaska, for a two-year 

period, with or without subsidy. 

Background

By Order 2012-9-10, September 11, 2012, the Department selected Alaska Airlines, Inc., 

to provide EAS at Adak, Alaska, for a one-year period through September 30, 2013. An 

annual subsidy of $1,675,703 was established for two nonstop or one-stop round trips per 

week to Anchorage with Boeing 737-400 combi-aircraft. 

Request for Proposals

As the end of the current rate term approaches, we are requesting proposals from carriers 

interested in providing service at Adak, with or without subsidy, for the period beginning 

October 1, 2013. Carriers should file their proposals by May 9, 2013. Staff will then 

docket the proposals, thereby making them public. Shortly afterwards, we will provide a 

summary of the proposals to the community and State and ask them to submit their final 

comments. We will give full consideration to all proposals filed in a timely manner.1 

Interested carriers should prepare their proposals with every expectation that their initial 

proposals will also be their final and only proposals. We retain the discretion to negotiate 

proposals with carriers when we deem it desirable. We also retain the discretion to reject 

outright all unreasonable or unrealistic proposals and, if necessary, solicit a new round of 

proposals. However, we anticipate that negotiation or rejection will remain only

occasional exceptions to the rule.

 

1 Carriers should not expect the Department to accept late filings. In cases where a carrier proposes to 

provide Essential Air Service without subsidy and we determine that service can be reliably provided 

without such compensation, we typically do not proceed with the carrier-selection case. Instead, we simply 

rely on that carrier’s subsidy-free service as proposed.
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We are here providing interested 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. We expect proposals to 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 as supporting data for their subsidy requests, such as 

projected block hours, revenues, and expenses. We strongly encourage clear, welldocumented proposals that will facilitate their evaluation by the affected community and 

the Department. We anticipate applying our usual carrier-selection criteria and the 

general provisions governing subsidy payments for EAS.

2 

As always, we will formally solicit the community’s views on any service options we 

receive before making a long-term carrier-selection decision. The community and air 

carriers are encouraged to work together in advance of the due date for proposals to craft 

a service pattern that is both desirable to the community and meets the operational needs 

of the airlines, as carriers cannot amend their proposal after the due date. 

We encourage proposals that meet the community’s requirements in an efficient manner. 

Proposals should propose to provide one- or two scheduled round trips per week with 60-

seat or larger aircraft – although more capacity may be needed to accommodate historical 

traffic if smaller aircraft are proposed. Carriers are also welcome to propose more than 

one service option, if they choose; they need not limit themselves to a single specific 

service pattern if they envision other, potentially more attractive service possibilities –

different hubs, or longer terms for the contracted service – with subsidy requirements that 

remain competitive.

We note that since the last carrier-selection proceeding, the new airport at Akutan (7AK) 

has begun to operate, and that there is fuel service available at that airport to carriers. If 

service to Anchorage is proposed, carriers may consider making intermediate stops at 

Akutan, either to transport Akutan passengers or simply to refuel aircraft. 

Filing Format

Carrier proposals should be submitted to the Department with all materials merged into a 

single document. In addition, because the document will be published on 

Regulations.gov, each page should be formatted to be viewed online.

 

2 In selecting a carrier to provide subsidized EAS in Alaska, 49 U.S.C. § 41733(c) (1) directs us to consider 

five factors: (1) service reliability; (2) contractual and marketing arrangements with a larger carrier at the 

hub; (3) interline arrangements with a larger carrier at the hub; (4) community views; and (5) experience of 

the applicant in providing, in Alaska, scheduled air service or significant non-scheduled air service. In 

addition, The Consolidated Appropriations Act, 2008, Public Law 110-161, provides that when selecting a 

carrier to provide EAS, the Department may consider 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 EAS will be included in the selection Order as part of our 

authorization of subsidy for the selected service. Appendix C of this Order contains those general 

provisions.
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Historical Traffic

In order to assist carriers in making their traffic and revenue projections, we have 

included historical traffic for the community in Appendix B for the most recent annual 

periods. 

Other Carrier Requirements

The Department is responsible for implementing various Federal statutes governing lobbying 

activities, drug-free workplaces, and nondiscrimination.3 Consequently, all carriers receiving 

Federal subsidy to support EAS must certify that they are in compliance with Department 

regulations regarding drug-free workplaces and nondiscrimination, and those 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 carriers that do not submit these documents, the selected 

carrier will be required to submit them in order to receive subsidy. Interested carriers 

requiring more detailed information regarding these requirements, as well as copies of the 

certifications, should contact the Office of Aviation Analysis at (202) 366-5903. The 

Department is prohibited from paying subsidy to carriers that do not submit these documents.

Community Comments

Civic officials and the State are welcome to submit comments on the proposals at any time. 

As noted earlier, we will provide a summary of the proposals to the civic parties and ask 

them to submit their final comments shortly after May 9, the due date for carrier proposals.

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

to the Director, Office of Aviation Analysis.

ACCORDINGLY,

1. The Department requests proposals from carriers interested in providing EAS at Adak, 

Alaska. Carriers should submit their proposals, with subsidy if necessary, by May 9, 2013. 

Proposals should be emailed to EAS@dot.gov, with the title “Proposal to Provide EAS at 

Adak, Docket DOT-OST-2000-8556.” Questions regarding filings may be directed to 

Kevin Adams at 202-366-1047 or Kevin.Adams@dot.gov;

2. This Docket will remain open until further Order of the Department; and

3. We will serve this Order on the service list for this Docket.

Persons entitled to petition the Department for review of this Order under the 

Department’s Regulations, 14 CFR Part 385.31, must file such petitions within seven (7) 

days after the date of service of this Order. 

 

3 The certifications are available on the web at

http://www.dot.gov/policy/aviation-policy/small-community-rural-air-service/essential-air-service
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This Order will 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 on the World Wide Web at

http://www.regulations.gov
Appendix A

Nonstop Great Circle Miles from Anchorage (ANC))

Shemya (SYA) 1,455

Adak (ADK) 1,192

Atka (AKB) 1,100

Dutch Harbor (DUT) 791

Akutan (7AK) 753

Cold Bay (CDB) 620

Other Nonstop Great Circle Miles

ADK-AKB 107

ADK-DUT 445

ADK-7AK 486

ADK-CDB 617
Appendix B

Adak Origin Adak Destination Adak O&D

Passenger Equivalents Passenger Equivalents Passenger Equivalents

Year Month Psgrs. Freight Mail Total Psgrs. Freight Mail Total Psgrs. Freight Mail Total

2010 3 208 2.5 6.7 217.2 163 108.5 99.9 371.4 371 111.0 106.6 588.6

2010 4 143 1.2 15.8 159.9 101 133.6 62.7 297.4 244 134.8 78.5 457.3

2010 5 131 24.3 6.8 162.1 182 146.5 78.8 407.3 313 170.8 85.5 569.4

2010 6 153 154.1 4.1 311.2 141 125.1 108.2 374.3 294 279.1 112.3 685.5

2010 7 155 144.3 3.4 302.7 155 174.3 67.3 396.6 310 318.6 70.7 699.3

2010 8 240 160.8 8.0 408.8 239 151.4 110.7 501.1 479 312.1 118.7 909.8

2010 9 253 101.0 15.1 369.2 197 196.6 67.0 460.6 450 297.6 82.2 829.8

2010 10 266 82.9 5.3 354.2 235 102.8 104.2 442.1 501 185.7 109.5 796.2

2010 11 161 57.3 5.3 223.6 142 71.7 75.6 289.3 303 129.1 80.9 513.0

2010 12 130 21.5 6.8 158.3 117 56.3 49.0 222.3 247 77.8 55.8 380.6

2011 1 89 14.9 2.7 106.7 97 68.8 36.9 202.7 186 83.8 39.7 309.4

2011 2 85 17.2 4.4 106.6 84 68.7 69.4 222.1 169 85.9 73.8 328.7

YE 2/28/11 2,014 782.0 84.4 2,880.3 1,853 1,404.4 929.9 4,187.2 3,867 2,186.3 1,014.2 7,067.5

2011 3 121 104.6 3.9 229.6 114 84.1 68.2 266.3 235 188.7 72.2 495.9

2011 4 88 74.7 1.0 163.7 102 101.2 44.8 248.0 190 175.9 45.8 411.7

2011 5 146 61.5 5.4 212.9 146 173.4 75.7 395.0 292 234.9 81.1 608.0

2011 6 139 77.5 12.8 229.4 177 140.3 47.3 364.6 316 217.8 60.2 594.0

2011 7 176 238.7 11.3 426.0 190 263.1 58.3 511.4 366 501.9 69.5 937.4

2011 8 232 15.1 4.4 251.5 187 135.9 129.9 452.8 419 151.0 134.3 704.3

2011 9 176 96.1 6.7 278.8 188 137.1 60.1 385.2 364 233.2 66.8 664.0

2011 10 230 93.4 4.0 327.4 240 122.0 60.7 422.6 470 215.4 64.6 750.0

2011 11 180 16.7 2.9 199.6 157 94.6 80.5 332.2 337 111.4 83.4 531.8

2011 12 183 21.9 4.2 209.1 174 77.4 51.7 303.1 357 99.3 55.9 512.2

2012 1 131 52.1 5.1 188.2 129 144.2 72.0 345.2 260 196.4 77.1 533.4

2012 2 101 62.2 3.7 166.9 266 119.6 50.7 436.3 367 181.8 54.4 603.2

YE 2/28/12 1,903 914.7 65.4 2,883.1 2,070 1,592.9 799.8 4,462.7 3,973 2,507.6 865.3 7,345.9

2012 3 187 237.5 5.3 429.7 181 148.7 70.4 400.1 368 386.1 75.7 829.8

2012 4 268 43.9 10.1 322.0 116 174.7 94.7 385.4 384 218.6 104.8 707.4

2012 5 172 213.1 17.8 402.9 182 184.1 53.7 419.8 354 397.2 71.5 822.8

2012 6 223 335.7 3.1 561.8 234 139.5 66.9 440.4 457 475.2 70.0 1,002.2

2012 7 190 361.0 3.0 554.0 175 173.9 83.4 432.3 365 534.9 86.4 986.3

2012 8 215 190.4 6.1 411.5 243 184.7 61.4 489.1 458 375.0 67.5 900.5

2012 9 161 227.7 2.7 391.4 133 107.1 88.0 328.1 294 334.9 90.7 719.6

2012 10 146 98.1 2.4 246.5 150 76.9 44.2 271.2 296 175.0 46.7 517.7

2012 11 204 73.8 5.3 283.1 190 71.3 53.2 314.5 394 145.1 58.5 597.5

2012 12 197 12.5 2.9 212.5 197 75.1 73.2 345.3 394 87.7 76.1 557.7

2013 1 103 20.2 3.3 126.5 129 72.7 45.0 246.6 232 92.9 48.2 373.1

2013 2 66 68.4 4.6 139.0 154 106.4 55.9 316.3 220 174.8 60.5 455.3

YE 2/28/13 2,132 1,882.4 66.5 4,080.9 2,084 1,515.0 790.1 4,389.1 4,216 3,397.3 856.6 8,470.0

Note: 200 pounds of mail or freight is one passenger equivalent (PEQ).

Source: T-100 Market Report
Appendix C

Example of General Terms and Conditions for Essential Air Service

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 may not be available for performance under this solicitation beyond [DATE]. The 

Department’s obligation for performance under this solicitation beyond [DATE], is 

contingent upon 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 [DATE], until funds are made available to the 

Department for performance. If funds are not made available for performance beyond 

[DATE], the carrier will receive notice in writing by the Department.

All claims for payment must be submitted within 60 days of the last day of service 

provided under this Order