BEFORE THE 

DEPARTMENT OF TRANSPORTATION 

OFFICE OF THE SECRETARY 

WASHINGTON, DC 

In the matter of Essential Air Service at ) 

) 

HYDABURG,ALASKA } 

) 

Under 49 U.S.C. § 41731 et seq. ) 

____________ ) 

Service Proposal of Taquan Air 

Docket DOT -OST -1999-6245 

In response to Order 2015-4-9 requesting proposals to provide Essential Air Service to Hydaburg, Alaska, 

Venture Travel, Inc. d/b/a Taquan Air hereby submits its proposal. Taquan Air and its predecessor 

carriers have provided Essential Air Service at Hydaburg since the beginning of the EAS program in 1978. 

At that time, Prince of Wales Island had extensive lumber and fishing industries. As the economy has 

changed, Taquan has remained committed to serving Hydaburg for its economic, civic and school needs. 

Hydaburg is the most isolated EAS village on Prince of Wales Island. There is no convenient wheel 

runway of ferry service, and the limited road requires approximately five hours to travel to Hollis, walk 

on the one ferry a day and arrive in Ketchikan. 

Taquan, and its corporate predecessor Ketchikan Air Service, have served Prince of Wales Island since 

the 1960's. During this period, service was provided using Cessna 180/185 and 206 aircraft as well as 

the deHavilland Beaver that has provided the bulk of the floatplance service in southeastern Alaska. 

Ketchikan Air introduced the first turbine powered float service in southeastern using a DHC-2 Beaver 

fitted with a Pratt & Whitney PT-6 engine. At that time, the highly seasonal operation did not provide 

the opportunity for year around utilization needed to offset the very high conversion costs. These 

aircraft continue to be used in less seasonal operations in the lower 48. 

Taquan has been committed to advancing air safety in the challenging conditions in southeastern Alaska. 

Taquan and its predecessor was a founder of the Alaska Air Carriers Association, and has served on its 

Board. It was one of the initial signators to the formation oft he Medallion Foundation which 

established rigid requirements for the awarding of stars in five safety categories. In 2008 Taquan was 

awarded the Medallion Shield for having completed all five star qualifications. Taquan is the only 

scheduled air carrier in Ketchikan with the Medallion Shield status. 

Just as the Cessna's before them, the Beavers are nearing the end of their economic life as the backbone 

of float service. While ownership costs are declining, the maintenance costs are increasing. The aircraft 

cannot be used in instrument flight conditions, which commonly affect Ketchikan to Prince of Wales 

operations year around. The Beavers will continue in service for years ahead, particularly for 

flightseeing which only operates in visual conditions during the summer. 
Taquan is proposing to use the Cessna Caravan (C-208) on amphibious floats as its primary aircraft on 

the route. Taquan has this aircraft in service now, and it is certified for flight in instrument conditions. 

Amphibious aircraft are required at Hydaburg, which has no land runway. The amphibious aircraft can 

not only land at either the land runway or floatplane facility at Ketchikan, but can be used for charters or 

team travel between Hydaburg and points served by runways such as Wrangell, Petersburg, and Juneau. 

In 2014, the aircraft was used extensively for testing, training and certification flights, and the unit costs 

reflected on the F-2 reports. Projected expenses are based on current experience for pilot costs, fuel, 

insurance and ownership amortized over the normal year of utilization. Maintenance is based other 

Alaska carrier costs, with adjustments to reflect higher unit costs for seaplane service. Indirect costs are 

Taquan experience for 2014 projected ahead. Capacity related expense is Taquan's current experience 

per F-2 reports. 

While the Caravan will be the primary aircraft used, Taquan anticipates that it will still use the 

deHavilland Beaver aircraft when the load is appropriate, and has submitted a bid to show costs per 

departure for the Beaver. All Beaver costs are derived for 2014 actual expenses. 

SUMMARY 

Despite the highly competitive nature of certificated air service in Ketchikan, Taquan is the only carrier 

to served Hydaburg on a scheduled basis, and the only carrier to offer to provide Essential Air Service. 

Taquan continues to enjoy strong community support, and has an agent with office and vehicle on site. 

Recognizing the greater utility and assured operating future of the Caravan, Taquan offers service for 

terms up to five years. Given the consistent nature of revenue and expenses increases, Taquan will 

accept the arithmetic mean of the rates per departure and year for whatever term the Department 

determines. The five year term has the advantage of amortizing fixed expenses over a longer period. 

Taquan remains committed to serving Hydaburg and other points out of Ketchikan. Taquan is the only 

multi-generational scheduled air carrier in Ketchikan, having begun air service in 1971, and has 

pioneered flightseeing and other tourist related services during the summer to offset the seasonal 

demand for air service. 

Respectfully submitted, 

Brien Salazar 

Chief Executive Officer 

May 21,2015 
ESSENTIAL AIR SERVICE AT HYDABURG, AK 

OPERATIONS 

MARKET 

WFB-HYG 

HYG-WFB 

TOTAL 

EXPENSES 

Item 

Pilot & CoPilot 

Fuel & Oil 

All Insurance 

Maintenance 

Depreciation 

TOTAL DIRECTS 

Traffic Related 

Departure Related 

TOTAL INDIRECTS 

SUBTOTAL 

CAPACITY RELATED 

TOTAL SYSTEM 

Specific Ground Support 

Vehicle Insurance 

Vehicle Maintenance 

Vehicle Fuel 

City Center Station 

TOTAL HYG VEHICLE 

TOTAL OP. EXPENSES 

PROFIT@ 5% MARKUP 

TOTAL ALL EXPENSES 

DEPS/YEAR AVG BLOCK TOTAL BLOCK 

156 27 4212 

156 

312 

Units 

140.4 

140.4 

140.4 

140.4 

140.4 

312 

312 

27 

Block Hours 

4212 

8424 

140.4 

CY 2014 Unit Costs 2016 Unit Costs 

$198.00 

$162.00 

$50.48 

$300.00 

$200.00 

$910.48 

$62.10 

$84.43 

$146.53 

11.96% 

$1,650.00 

$3,400.00 

$3,300.00 

$6,000.00 

$14,350.00 

$213.84 

$174.96 

$54.52 

$324.00 

$216.00 

$983.32 

$67.07 

$91.18 

$158.25 

ESSENTIAL AIR SERVICE AT HYDABURG, AK 

TRAFFIC per Blk Hr Sched Traffic 2016 Proj. Yield 

PASSENGERS 0.1506 47 $130.50 

FREIGHT 14.4231 4500 $0.88 

MAIL 112.1795 35000 $1.13 

TOTAL 

SUBSIDY NEED 

SUBSIDY NEED/DEPARTURE 

CARAVAN SERVICE 

2016 Costs 

$30,023.14 

$24,564.38 

$7,654.38 

$45,489.60 

$30,326.40 

$138,057.90 

$20,925.22 

$28,449.53 

$49,374.75 

$187,432.65 

$22,416.95 

$209,849.60 

$1,782.00 

$3,672.00 

$3,564.00 

$6,480.00 

$15,498.00 

$225,347.60 

$11,267.38 

~236,614.98 

2016 Revenue 

$6,133.50 

$3,960.00 

$39,480.00 

$49,573.50 

$187,041 

$599.49 

2017 Costs 

$31,224.06 

$25,546.96 

$7,960.56 

$47,309.18 

$31,539.46 

$143,580.22 

$21,762.22 

$29,587.51 

$51,349.74 

$194,929.96 

$23,313.62 

$218,243.58 

$1,853.28 

$3,818.88 

$3,706.56 

$6,739.20 

$16,117.92 

$234,361.50 

$11,718.08 

~246,079.58 

2017 Revenue 

$6,378.84 

$4,039.20 

$39,480.00 

$49,898.04 

$196,182 

$628.79 

2018 Costs 

$32,473.02 

$26,568.84 

$8,278.98 

$49,201.55 

$32,801.03 

$149,323.43 

$22,632.71 

$30,771.01 

$53,403.73 

$202,727.16 

$24,246.17 

$226,973.32 

$1,927.41 

$3,971.64 

$3,854.82 

$7,008.77 

$16,762.64 

$243,735.96 

$12,186.80 

~255,922. 76 

2018 Revenue 

$6,633.99 

$4,119.98 

$39,480.00 

$50,233.98 

$205,689 

$659.26 

2019 Costs 

$33,771.94 

$27,631.59 

$8,610.14 

$51' 169.61 

$34,113.08 

$155,296.37 

$23,538.02 

$32,001.86 

$55,539.88 

$210,836.24 

$25,216.01 

$236,052.26 

$2,004.51 

$4,130.50 

$4,009.02 

$7,289.12 

$17,433.14 

$253,485.40 

$12,674.27 

~266,159.67 

2019 Revenue 

$6,899.35 

$4,202.38 

$39,480.00 

$50,581.74 

$215,578 

$690.95 

A

20

Ap

202
-----------

ESSENTIAL AIR SERVICE AT HYDABURG, AK 

OPERATIONS 

BEAVER SERVICE Appendix A 

Page 3 of4 MARKET 

WFB-HYG 

HYG-WFB 

TOTAL 

EXPENSES 

Item 

Pilot & CoPilot 

Fuel & Oil 

All Insurance 

Maintenance 

Depreciation 

TOTAL DIRECTS 

Traffic Related 

Departure Related 

TOTAL JNDIRECTS 

SUBTOTAL 

CAPACITY RELATED 

TOTAL SYSTEM 

Specific Ground Support 

Vehicle Insurance 

Vehicle Maintenance 

Vehicle Fuel 

City Center Station 

TOTAL HYG VEHICLE 

TOTAL OP. EXPENSES 

PROFIT@ 5% MARKUP 

TOTAL ALL EXPENSES 

DEPSNEAR AVG BLOCK 

156 

156 

312 

Block Hours 

36 

36 

TOTAL BLOCK 

5616 

5616 

11232 

187.2 

Units CY 2014 Unit Costs 2016 Unit Costs 2016 Costs 

187.2 $140.57 $151.82 $28,419.88 

187.2 

187.2 

187.2 

187.2 

312 

312 

$132.42 

$24.91 

$152.16 

$51.11 

$501.17 

$62.10 

$84.43 

$146.53 

11.96% 

$1,650.00 

$3,400.00 

$3,300.00 

$6,000.00 

$14,350.00 

$143.01 

$26.90 

$164.33 

$55.20 

$541.26 

$67.07 

$91.18 

$158.25 

$26,772.15 

$5,036.20 

$30,763.10 

$10,333.22 

$101,324.55 

$20,925.22 

$28,449.53 

$49,374.75 

$150,699.29 

$18,023.64 

$168,722.93 

$1,782.00 

$3,672.00 

$3,564.00 

$6,480.00 

$15,498.00 

$184,220.93 

$9,211.05 

~193,431.98 

2017 Costs 2018 Costs 2019 Costs 2020 Costs 

$29,556.68 $30,738.94 $31,968.50 $33,247.24 

$27,843.03 $28,956.75 $30,115.02 $31,319.62 

$5,237.65 $5,447.16 $5,665.04 $5,891.65 

$31,993.62 $33,273.37 $34,604.30 $35,988.48 

$10,746.54 $11,176.41 $11,623.46 $12,088.40 

$105,377.53 $109,592.63 $113,976.33 $118,535.39 

$21,762.22 $22,632.71 $23,538.02 $24,479.54 

$29,587.51 $30,771.01 $32,001.86 $33,281.93 

$51,349.74 $53,403.73 $55,539.88 $57,761.47 

$156,727.27 $162,996.36 $169,516.21 $176,296.86 

$18,744.58 $19,494.36 $20,274.14 $21,085.10 

$175,471.85 $182,490.72 $189,790.35 $197,381.96 

$1,853.28 $1,927.41 $2,004.51 $2,084.69 

$3,818.88 $3,971.64 $4,130.50 $4,295.72 

$3,706.56 $3,854.82 $4,009.02 $4,169.38 

$6,739.20 $7,008.77 $7,289.12 $7,580.68 

$16,117.92 $16,762.64 $17,433.14 $18,130.47 

$191,589.77 $199,253.36 $207,223.49 $215,512.43 

$9,579.49 $9,962.67 $10,361.17 $10,775.62 

~201,169.26 ~209,216.03 ~217 ,584.67 ~226,288.05 

ESSENTIAL AIR SERVICE AT HYDABURG, AK BEAVER SERVICE Appendix A 

Page 4 of4 

TRAFFIC 

PASSENGERS 

FREIGHT 

MAIL 

per Blk Hr Sched Traffic 2016 Proj. Yield 2016 Revenue 2017 Revenue 2018 Revenue 2019 Revenue 2020 Revenue 

TOTAL 

SUBSIDY NEED 

0.1506 

14.4231 

112.1795 

SUBSIDY NEED/DEPARTURE 

47 $130.50 $6,133.50 $6,378.84 $6,633.99 $6,899.35 $7,175.33 

4500 $0.88 $3,960.00 $4,039.20 $4,119.98 $4,202.38 $4,286.43 

35000 $1.13 $39,480.00 $39,480.00 $39,480.00 $39,480.00 $39,480.00 

$49,573.50 $49,898.04 $50,233.98 $50,581.74 $50,941.76 

$143,858 

$461.08 

$151,271 

$484.84 

$158,982 

$509.56 

$167,003 

$535.27 

$175,346 

$562.01