Order 20 1 2

- 12

- 2

Served: December 5 , 20 12



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY
WASHINGTON, D.C.

Issued by the Department of Transportation

on the 5 th day of December , 20 1 2

Essential Air Service at

ALLIANCE, NEBRASKA
CHADRON, NEBRASKA

Under 49 U.S.C. § 41731 et seq

. DOCKET DOT

- OST

- 200 0

- 8322



### ORDER REQUESTING PROPOSALS

Summary

By this O rder, the Department is requesting proposals , by January 8 , 201 3

, from carriers
interested in providing E ssential Air S ervice (EAS) at Alliance and Chadron

, Nebraska

, for a

new contract period beginning June 1 , 20 1 3 , with or without subsidy. (See Appendix A for
map.)

Background

By Order 201 1

- 4

- 9 (April 7, 2011) , the Department re selected Great Lakes Aviation, Ltd. (Great
Lakes)

, to provid e EAS at Alliance and Chadron for the two

- year period ending May 31 , 2013

. That O rder established a combined annual subsidy rate for both communities of $ 2,217,401 for

s ervice consist ing of 1 2 nonstop or one

- stop rou nd trips per week to Denver International Airport
from each community

. S ervice i s provided on twin

- engine Beech 1900D aircraft with 19

passenger seats

.

Request for Proposals
As the end of the current rate term approaches, and in order to provide sufficient time to
complete the carrier

- selection process before the current contract expires, we are here requesting
proposals from carriers interested in providing service at Alliance and Chadron , with or without
subsidy support, for a new contract period beginning June 1 , 201 3 . Carriers should file their
proposals no later than January 8 , 201 3 . After that date, our staff will docket the proposals

, thereby making them public

. Shortly afterwards, we will provide a summary of the prop osals to2

community officials 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 th e discretion to reject
outright all unreasonable or unrealistic proposals and solicit a new round of proposals.

We are here providing interested carriers with some basic information to serve as guidance when
they prepare their proposals, but we will not p rescribe 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 pres ent; 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, well

- documented proposals that will facilitate their eval uation by
the affected community and the Department. 2

In order to assist carriers in developing traffic and revenue projections for their proposals, we
have summarized historical passengers in Appendix B. For the year ended May 31, 2012,
Alliance generat ed 3,501 total origin and destination passengers, or 5.6 average daily
enplanements. For the same period, Chadron generated 4,080 origin and destination passengers,
or 6.5 average daily enplanements.

W e request proposals for service consistent with what the community currently receives, namely,
two daily nonstop or one

- stop round trips (12 per week) with 19

- seat or larger aircraft to Denver International Airport or another suitable hub with convenient connections to the national air
transportation system. Carriers using smaller aircraft may propose more frequencies than the
two daily round trips described above. We encourage proposals that meet these requirements in

an efficient manner . Carriers are also welcome to propose more than one service option, if they
choose; they need not limit themselves to those requirements if they envision other, potentially
more attractive service possibilities

-- different hubs or length of contract , fo r example

-- with
subsidy requirements that remain competitive.

W e will formally solicit the communit ies’ views on any service options we receive before
making a long

- term carrier selection decision. The community and air carriers are encouraged to

1 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 service can be reliably provided without such compensation, we typically do
not proceed with the car rier selection case. Instead, we simply rely on that carrier’s subsidy

- free service as
proposed.

2 In selecting a carrier to provide subsidized essential air service, 49 U.S. C. § 41733(c)(1) directs us to consider
four 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; and (4) community views. 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 go verning EAS
will be included in the selection order as part of our authorization of subsidy for the selected service. Appendix C

of this O rder contains those general provisions.3

wor k together in advance of the due date for proposals to craft a service pattern th at is desirable

to the communities and meets the o perational needs of the airline submitting the proposal.

Filing Procedures
Proposals should be submitted via email to EAS@dot.gov

. 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 so as
to be easily viewed online.

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. All carriers that plan to submit
proposals involving subsidy should submit the required certifications along with their proposals.
Interested carriers requiring more detailed informati on 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. 4

Community and St ate Comments
Civic officials 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 January 8 , 2013 , the due date for carrier proposals.

This O rder is issued under authority delegated in 49 CFR Part 1.56a(f) and re

- delegated to the
Director, Office of Aviation Analysis.

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

– New r estrictions 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 receiving 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 gov ernment

- wide requirements for drug

- free workplace (grants).

4 The certifications are also available on the web at http://www.dot.gov/policy/a viation

- policy/small

- community

rural

- air

- service/essential

- air

- service

.4

ACCORDINGLY,
1. We request that carriers interes ted in providing Essential Air S ervice at Alliance and

Chadron

, Nebraska

, submit their proposals, with or without subsidy requests, no later than
January 8 , 20 1 3 . The proposals should be emailed to EAS@dot.gov with the title “Proposal to

Provide Essent ial Air Service at Alliance and Chadron, Nebraska , Docket DOT

- OST

- 200 0

- 8322 ”

.

2. Docket DOT

- OST

- 200 0

- 8322 will remain open until further O rder of the Department; and

3. The Depart ment will serve a copy of this O rder on the mayor s and airport manager s of

Alliance and Chadron , Nebraska

, Great Lakes Aviation, Ltd.

, 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 385.50, must file such petitions within ten (10)
days after the date of service of this O rder.

This O rder 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 Analysi s

(SEAL)

An electronic version of this document is available on line at www.regulations.govAppendix A



## Area Map

This map is provided by Sabre ® AirVision TM Profit Essentials and is being used with express permission of the
copyright holder, Sabre Airlines Solutions ®.Appendix B



### Historical O&D Traffic 1

Great Lakes at Alliance, NE

Year Month Origin Destination Total

O&D

2010 6 141 189 330

2010 7 124 120 244

2010 8 125 110 235

2010 9 111 97 208

2010 10 134 157 291

2010 11 140 135 275

2010 12 136 164 300

2011 1 89 86 175

2011 2 95 85 180

2011 3 94 113 207

2011 4 109 125 234

2011 5 148 158 306

2011 6 192 189 381

2011 7 148 170 318

2011 8 206 192 398

2011 9 158 163 321

2011 10 194 185 379

2011 11 147 158 305

2011 12 148 160 308

2012 1 126 113 239

2012 2 75 88 163

2012 3 97 104 201

2012 4 112 113 225

2012 5 130 133 263

Average Daily Enplanements YE May, 2012 : 5.6 2

1 Source: Bureau of Transportation Statistics Form 41: T

- 100 Domestic Market.

2 Average Daily Enplanements calculated by dividing total O&D passengers by 313 service days, divided by 2

directions.Appendix B

Great Lakes at Chadron, NE

Year Month Origin Destination Total

O&D

2010 6 149 185 334

2010 7 178 180 358

2010 8 155 167 322

2010 9 142 152 294

2010 10 133 145 278

2010 11 170 183 353

2010 12 185 171 356

2011 1 120 232 352

2011 2 90 133 223

2011 3 102 123 225

2011 4 152 136 288

2011 5 201 191 392

2011 6 194 192 386

2011 7 194 190 384

2011 8 175 178 353

2011 9 160 159 319

2011 10 183 169 352

2011 11 178 173 351

2011 12 199 158 357

2012 1 141 148 289

2012 2 170 142 312

2012 3 171 166 337

2012 4 128 137 265

2012 5 201 174 375

Average Daily Enplanements YE May, 2012 : 6.5Appendix 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 eligibi lity
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 comple te 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 ser vice 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 th at 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 reduct ion 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 [DATE] . The
Government's obligation for performance under this order beyond [DATE] is contingent upon
the availability of appropriate d 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 perfo rmance 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.