Order 2010
- 5
- 19 Served: May

17, 2010 

### UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION 

### OFFICE OF THE SECRETARY WASHINGTON, D.C.

Is sued by the Department of Transportation on the 17 th of May , 2010 Essential Air Service at CRESCENT CITY , CALIFORNIA Under 49 U.S.C. 41731 et seq . DOCKET OST - 1997 - 2649

ORDER RESELECTING CARRIER S Summary By this order , the Department is reselecting Sky West Airlines, Inc., d/b/a United Express (Sky West) , to provide essential air service (EAS) at Crescent City , Califo rnia , at an annual subsidy rate of $1, 781,888
. 1 The selection extends from August 1, 2010, through July 31, 2012
. Background Order 2008
- 4
- 23 , April 15, 2008, re selected Sky West to provide 12 nonstop round trips per week to San Francisco and 6 one
- stop ro und trips a week to Sacramento with 30
- seat Embraer Brasilia aircraft , for the two - ye ar period ending July 31 , 20 10 , at the annual subsidy rate of $1, 136,896
. Inanticipation of the end of the current contract on July 3 1, b y Order 20 10
- 3
- 22 we requested p roposals for replacement service , with proposals due April 1 9 . We received a timely filed proposal from only

one carrier, Sky

West , and requested comments from the community
. On May 4 we received comments from the community , and the issue is ripe for deci sion. Carrier Proposal Sky West was the only

carrier to submit a proposal, and its proposal included only one option. The carrier proposes to eliminate its six one
- stop round trips per week between Crescent City and Sacramento, but to increase its servic e between Crescent City and San Francisco from twelve

1 Such subsidy i s calculated and distributed on a fiscal year basis, subject to the availability of appropriated funds.- 2
-

nonstop round trips per week to fourteen. All of the service would be with 30
- seat Embraer Brasilia aircraft, and Sky

West requests $1,781,888 for this service
. Community Comments W e have received community comment s from the Mayor of Crescent City and from the Airport Manager. The mayor noted that Sky West’s air service was of critical importance to the community

and was a driver for its economic development. She expressed appreciation for the cooperat ive relationship between the community and Sky West, the c ommunity ’s long
- term air service provider. The Airport Manager noted that Sky West’s bid would eliminate the service to Sacramento. “Although we regret losing service to the state capit al, it appear s that the greatest average passenger traffic is consistently into San Francisco.” Decision Sky West is the only

carrier to submit a proposal, it submitted only one option, and w e have decided to select it
. Sky

West’s proposal will provide excellent access to the national air transportation system with its code
- share arrangements with United Airlines at the San Francisco hub. Further, while the community regrets the loss of its service to Sacramento, they understand that its historical service to Sacrament o , which we will no longer subsidiz e , generated only four passengers per flight compared to 15 per flight for the community ’s service to San Francisco
. Sky West’s proposal reflects recent historical traffic, augmented by the increase in service it has proposed to San Francisco

– from 12 to 14 round trips per week. Also, Sky West’s unit costs are still low compared to other carriers operating comparable equipment. In brief, w e find Sky West’s proposal to be reasonable for the service pro posed
. Carrier Fi tness 49 U.S.C. 41737(b) requires that DOT find an air carrier fit, willing, and able to provide reliable service before DOT may

subsidize it to provide essential air service. Sky West Airlines , Inc. is subject to the Department’s continuing fitness requirements, and no information has come to our attention that would cause us to question the carrier ’ s fitness at this time. DOT has contacted the Federal Aviation Administration, and it has raised no concerns that would negatively affect our fitness finding s . DOT therefore concludes that the carrier s remain fit to conduct the operations proposed here. This order is issued under authority delegated in 49 CFR 1.56a(f). ACCORDINGLY, 1. We re select Sky

West Airlines , In c., to provide essential air service at Crescent City, California , as described in Appendix C ;- 3
-

2 . We direct Sky

West Airlines , In c., to retain all books, records, and other source and summary documentation to support claims for pay ment, and to preserve and maintain such documentation in a mann er that readily

permits its audit and examination by representatives of the Department. Such documentation shall be retained for seven years 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 carrier may forfeit its compensation for any claim that is not supported under the terms of this order; 3 . We find that Sky

West Airlines , In c., continue s to be fit, willing and able to operate as a certificated carrier and capable of providing reliable essential air service at Crescent City , California ; 4 . Th is docket will remain open until further order of the Department; and 5 . We will serve copies of this order on the city of Crescent City, the airport manager, and Sky West Airlines, Inc.

. By : Susan L. Kurland Assistant Secretary

for Aviation and International Affairs (SEAL) An electronic version of this document is available on the W orld W ide W eb at http://www.regulations.govAppendix A

Nonstop, Great Circle Miles from Crescent City ( CEC ) San Francisco , SFO 304 Eureka , ACV 56 Sacramento , SMF 255 Portland , PDX 276 Medford , MFR 81
This map is provided by Sabre ® AirVision TM Profit Essentials and is being used with express permission of the copyright holder, Sabre Airline Solutions®.Appendix B Annual Subsidy at Crescent City, California

Carrier SkyWest Docket Number 1997-2649 Hub San Francisco Weekly Round Trips 14 Passengers 22,200 Block Hours 1/ 2,188 Passenger Revenue $2,175,600
Total Directs $2,523,039 Total Indirects $1,245,997 Total Operating $3,769,036 Return @ 5% $188,452 Total Economic Cost $3,957,488 Annual Subsidy $1,781,888 1/ CE-SFO, 92 minutes/flight x 28 one-way flights per week x .98 completion ÷ 60.Appendix C SkyWest Airlines , Inc., Essential Air Service to be Provided to Crescent City , California , Dockets OST - 1997 - 2649 Effective Period : August 1, 20 1 0 , through July 31 , 2012
. Scheduled Service : 14 nonstop round trips per week to San Francisco
. Aircraft : Embraer Brasilia, 30
- seats Rate per Eligible Flight: $ 1,249 1 Weekly Ceiling : $ 3 4,97 2 2 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 significan t e lements 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 per iod, 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 rece ive 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 sa fely 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 complete ly , terminates or reduces payments for service or changes service requirements at a specif ic location provided for under this order, then, at the end of the period for w hich 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 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 fore going paragraph. Funds are not currently available for performance under this order beyond September 30, 2010 . The Government’s obligation for performance under this order beyond September 30, 2010 , is subject to the availability of appropriated funds fr om

w hich 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, 2010 , until funds are made available to the Department for performance. If funds are not made available for performance beyond September 30, 2010 , the Department will provide notice in writing to the carrier. All claims for payment must be submitted within 60 days of the last day of service provided under this order.

1 Annual compensation of $1,781,888 divided by the estimated annual completed departures and arrivals: 28 flights/week x 52 weeks x .98 completion = 1 ,427 total. 2 28 flights/week x $ 1,249
.