Order 2012-7-22

Served: July 17, 2012 UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 17th day of July, 2012

Fitness Determination of

 CITY WINGS, INC. d/b/a SEAFLIGHT

as a commuter air carrier under section 49 U.S.C. 41738

 Docket DOT-OST-2010-0263

ORDER TO SHOW CAUSE

PROPOSING ISSUANCE OF COMMUTER AIR CARRIER AUTHORITY

Summary

By this order, we tentatively find that City Wings, Inc. d/b/a Seaflight (“City Wings”) is a citizen 

of the United States and is fit, willing, and able to conduct scheduled passenger operations as a 

commuter air carrier, subject to conditions.

Background

Section 41738 of Title 49 of the United States Code (“the Statute”) and section 298.32 of the 

Department’s Aviation Economic Regulations (14 CFR 298.32) direct us to determine whether 

companies proposing to provide scheduled passenger service as commuter air carriers are “fit, 

willing, and able to operate the proposed commuter service.” We must also ensure that all 

operations relating to this service conform to the safety standards established by the Federal 

Aviation Administration (“FAA”). In making fitness findings, the Department uses a three-part 

test that reconciles the Airline Deregulation Act’s liberal entry policy with Congress’ concern for 

operational safety and consumer protection. The three areas of inquiry that must be addressed in 

order to determine an air carrier’s fitness are whether the applicant: (1) will have the managerial 

skills and technical ability to conduct the proposed operations, (2) has sufficient financial 

resources to commence the operations proposed without posing an undue risk to consumers or 

their funds, and (3) will comply with the Statute and regulations imposed by federal and state 

agencies. We must also determine that the applicant is a U.S. citizen.

On October 20, 2010, City Wings, an operating air taxi, filed an application in Docket 

DOT-OST-2010-0263 requesting authority to conduct scheduled passenger operations as a 

commuter air carrier pursuant to section 41738 of the Statute. City Wings accompanied its 

application with the fitness information required by section 204.3 of our regulations (14 CFR 

204.3).1

 

1 City Wings filed additional information supplementing its application on March 28, April 18, October 19, 

November 8, and December 2011. 
2

No answers opposing City Wings’ application were filed and no special issues regarding the 

applicant have come to our attention. Under these circumstances, we propose to decide the issue 

of the applicant’s fitness on the basis of the written record, and we tentatively conclude that City 

Wings is a U.S. citizen and is fit, willing, and able to provide scheduled passenger operations as 

a commuter air carrier. However, we will give interested persons an opportunity to show cause 

why we should not adopt as final these tentative findings and conclusions.

FITNESS

The Company

City Wings, a corporation organized under the laws of Puerto Rico is wholly owned by Mr. Don 

Lewis. He purchased the company on August 25, 2007, and resumed its once dormant 

operations. The company currently provides on-demand air transportation under Part 135 of the 

Federal Aviation Regulations and Part 298 of our rules (14 CFR 298). If granted commuter 

authorization, City Wings intends to initiate 4 daily roundtrip scheduled flights between 

St. Croix, Virgin Islands, and St. Thomas, Virgin Islands, using Cessna 208 amphibious aircraft 

configured for 9 passenger seats.

Managerial Competence

City Wings management and key technical personnel consist of the following individuals:

Mr. Don Lewis – President and Board Member

Ms. Yilong Xiang - Manager of Non-flight Personnel and Board Member

Mr. William Weist - Director of Operations

Mr. Edward Lucia Director of Maintenance

Mr. David Peltier - Chief Pilot

Mr. Don Lewis is an experienced aviation executive and a resident of St. Thomas. He previously 

held an ownership interest in Lewis Airlines, Inc. d/b/ a Sea Jet (1985-1987), a seaplane leasing 

company based in St. Croix, and he has wholly-owned or held a majority ownership interest in 

several on-demand air carriers, including Virgin Island Seaplane Shuttle (1984-1985), Shuttle 

Transit (1978-1980), and Seaplane Shuttle Transit (1975-1977). In addition to serving as 

President of City Wings, Mr. Lewis is also president and minority owner of Aguadilla Air 

Service, Inc., an on-demand air carrier based in Puerto Rico and he wholly-owns and manages

Riverside Tower Hotel, LLC, a hotel located in New York City, as well as its holding company, 

Cosmopolitan Broadcasting Corp. 

Ms. Yilong Xiang has served in her current position since February 2007. Prior to this, she was 

employed by Riverside Tower Hotel as a marketing and reservations manager (2000-2007). 

Mr. William Weist, an Airline Transport Pilot with more than 11,500 flight hour, became City 

Wings’ Director of Operations in September 2011. Prior to this, he was employed by City 

Wings as a line pilot (January 2011-August 2011). Before joining City Wings, Mr. Weist served 

as a pilot for various air carriers, having begun his career in aviation in 1988 as a line pilot for 

Taku Glacier Air.
3

Mr. David Peltier, a commercial pilot with more than 3,900 total flight hours, joined City Wings 

as its Chief Pilot in December 2011. Prior to this, he was employed by Aguadilla Air Service as 

Chief Pilot (2009-2011). Mr. Peltier has also previously been employed as a pilot for multiple 

on-demand air carriers, including Ace Flight Center (1997-2004 and 2006-2011), Bevin’s Air 

Service (2000-2004), and Central Air Southwest (2005-2006).

Mr. Edward Lucia, an airframe and powerplant mechanic, has more than 29 years of experience 

in aviation maintenance. He joined City Wings as its Director of Maintenance in February 2009. 

Prior to this, he served as Director of Maintenance at several companies, including Ace Flight 

Center (2008-2010); Jet Set (2007-2008); FX Aviation (2002-2010); Your Aircraft Source 

(2002-2003;, Elite Air Center (1990-1996); and Flying Machines (1975-1986). In addition to his 

experience in aviation maintenance, Mr. Lucia has also previously served as president of Lucia 

Aircraft Sales and Service (1996-2012).

In view of the experience of the applicant’s key personnel, we tentatively conclude that City 

Wings’ management team possesses the managerial skills and technical ability to conduct the 

proposed operations.2

Operating Proposal and Financial Plan

If granted the commuter authorization it seeks, City Wings intends to operate scheduled service 4

times daily between Cyril E. King Airport, St. Thomas, and Henry E. Rohlson Airport, St. Croix

using two Cessna 208 amphibious aircraft configured for 9 passenger seats. 

We have generally asked that new entrant applicants have resources sufficient to cover all preoperating costs, plus a working capital reserve equal to the operating costs that would be incurred 

in three months of normal commuter operations.

3 City Wings states that since it is already 

providing operations as an existing on-demand air carrier, it does not expect to incur preoperating expenses associated with the operations it proposes. The applicant projects total 

operating expenses of about $881,907 for its first year of scheduled service. Based on our 

evaluation, we find these expense projections reasonable and estimate that the company will 

need approximately $220,000 to meet our financial fitness test.4 

 

2 Before authorizing an air carrier to conduct air transportation operations, the FAA also evaluates certain of the 

applicant’s key personnel with respect to the minimum qualifications for those positions as prescribed in the Federal 

Aviation Regulations. The FAA’s evaluation of these key personnel provides an added practical and in-person test 

of the skills and technical ability of these individuals. The FAA has advised us that City Wings’ key technical 

personnel are acceptable to that agency in their respective positions.

3 It has been our practice to base our three-month standard on one quarter of the first year’s operating cost 

forecast because projected operations during one or more of the first three months of anticipated actual air 

transportation services frequently do not include all costs of operations that will be incurred during a normal period 

of operations. In calculating available resources, projected revenues may not be used. 

4 We have generally asked that new entrant applicants have resources sufficient to cover all pre-operating costs, 

plus a working capital reserve equal to the operating costs that would be incurred in three months of normal 

commuter operations. However, because projected operations during one or more of the first three months of 

anticipated actual air transportation services frequently do not include all costs of operations that will be incurred 

during a normal period of operations, it has been our practice to base our three-month standard on one quarter of the 

first year’s operating cost forecast. In calculating available resources, projected revenues may not be used. 
4

In support of ability to meet our financial fitness requirements, City Wings submitted current and 

historical financial statements demonstrating the company’s most recent results from operations. 

The historical profit and loss statements provided by the applicant show that for calendar year 

2009, the company reported a net income of $41,483 on $825,892 in operating revenues; for 

calendar year 2010, the company reported a net income of $102,117 on $688,971 in operating 

revenues; and for the 9-months ending September 30, 2011, the company reported a net loss of 

$22,936 on $744,388 in operating revenues. The company’s September 30, 2012, balance sheet 

shows that the company has no long term-debt, a cash balance of more than $120,000, and a 

positive working capital balance. In addition, City Wings provided third party verification from 

Merchant Commercial bank demonstrating that it had more than $300,000 on deposit and 

available to support its proposed operations. 

In light of the above, we tentatively conclude that City Wings will have access to sufficient 

financial resources to enable it to commence its proposed operations without posing an undue 

risk to consumers or their funds.5

Compliance Disposition 

The applicant states that there are no pending actions or outstanding judgments against it, its 

owners, its key personnel, or any relevant corporation nor have there been any charges of unfair, 

deceptive or anti-competitive business practices, or of fraud, felony or antitrust violations 

brought against any of these parties in the past ten years. The applicant also states that there are 

no pending investigations, enforcement actions, or formal complaints filed by the Department 

against it, its key personnel, any relevant corporation, or persons having a substantial interest in 

it with respect to compliance with the Statute or the Department’s regulations.6

Our review of FAA records indicate that City Wings has been subject to six enforcement actions 

since initiating operations under its new ownership all of which are now closed. All but one of 

the FAA enforcement actions were closed with an administrative warning notice. The only FAA 

enforcement action to occur which warranted the issuance of a civil penalty involved violations 

of FAA flight operation regulations for operating aircraft without appropriate economic or safety 

authority. City Wings was assessed a civil penalty of $50,000 for the violation, which the FAA 

has informed us has been fully paid.

 

5 As is our practice, prior to making any authority awarded to City Wings effective, we will require the company 

to provide third-party verification evidencing that it has actually obtained the financial resources needed to meet our 

financial test.

6 Mr. Lewis notes that although he was identified as the owner and president of Kingfisher Air Serivce d/b/a Sea 

Jet (“Kingfisher”) in a National Transportaiton Safety Board (“NTSB”) hearing regarding a proposed revocation of 

the operating authority issued to Kingfisher, he was never an owner, officer, or director of Kingfisher. Instead, 

Mr. Lewis states that Lewis Airlines, Inc. d/b/a Sea Jet,, a seaplane leasing company, licensed the “Sea Jet” trade 

name to Kingfisher and leased the air carrier an aircraft and that this close business relationship may have resulted in 

the Administrative Law Judge (“ALJ”) misstating Mr. Lewis’s association with Kingfisher. In any event, Mr. Lewis 

notes that the proposed revocation of Kingfisher’s operating authority was not upheld by the ALJ.
5

City Wings has been involved in no accidents since initiating its Part 135 on-demand air taxi 

operations and it has only been involved in only one incident.7 Furthermore, the FAA has 

advised us that the applicant has begun the progress of obtaining the required safety authority for 

the operations proposed and that it has no objection to the Department’s approval of City Wings’

application for commuter authority.

In light of these circumstances, we tentatively conclude that City Wings has the proper regard for 

the laws and regulations governing its services to ensure that its aircraft and personnel conform 

to applicable safety standards and that acceptable consumer relations practices will be followed.

CITIZENSHIP

The Statute requires that authority to engage in air transportation be held only by citizens of the 

United States as defined in 49 U.S.C. § 40102(a)(15). The Statute also requires that the president 

and two-thirds of the Board of Directors and other managing officers be U.S. citizens, that at 

least 75 percent of the outstanding voting interest be owned by U.S. citizens, and that the air

carrier must be under the actual control of U.S. citizens. 

As noted earlier, City Wings is a corporation formed under the laws of Puerto Rico. All of the 

applicant’s key personnel are citizens of the United States, as well as the applicant’s sole owner. 

Mr. Don Lewis. Moreover, the applicant has provided an affidavit attesting that it is a citizen of 

the United States within the meaning of the Statute and that it is owned and controlled by U.S. 

citizens. Our review of the applicant has uncovered no reason to suggest that control of City 

Wings rests with non-U.S. citizens.

In light of the foregoing, we tentatively find that City Wings is owned and actually controlled by 

U.S. citizens, consistent with 49 U.S.C. § 40102(a)(15) and is fit, willing, and able to provide

commuter operations, subject to conditions. 

OBJECTIONS

We will give interested persons 14 days following the service date of this order to show cause 

why the tentative findings and conclusions set forth here should not be made final; answers to 

objections will be due within 7 days thereafter. We expect such persons to direct their 

objections, if any, to the application and points at issue and to support such objections with 

detailed economic analyses. If an oral evidentiary hearing or discovery procedures are 

requested, the objector should state in detail why such a hearing or discovery is considered 

necessary, and what material issues of decisional fact the objector would expect to establish 

through a hearing or discovery that cannot be established in written pleadings. The objector 

should consider whether discovery procedures alone would be sufficient to resolve material 

issues of decisional fact. If so, the type of procedure should be specified (See Part 302, Rules 19 

and 20); if not, the reasons why not should be explained. We will not entertain general, vague, 

or unsupported objections. 

 

7 On April 28, 2009, Cessna 208 amphibious aircraft operated by City Wings touched down at Henry E. Rohlson 

Airport prior to the landing gear fully extending. No injuries or fatalities resulted from the incident.
6

EFFECTIVE COMMUTER AUTHORIZATION

CONDITIONS AND LIMITATIONS

In the event that we find City Wings fit, willing, and able to conduct the proposed scheduled 

service, we will issue to it a Commuter Air Carrier Authorization. However, that authorization 

will not become effective until the company has fulfilled all of the requirements for effectiveness 

as set forth in the Terms, Conditions, and Limitations attached to it. Among other things, this 

includes (1) our receipt of evidence of City Wings’ authority from the FAA authorizing Part 135 

commuter operations, (2) evidence of liability insurance coverage that meets the requirements of 

section 205.5(b) of our rules, (3) a statement of changes it may have undergone since its fitness 

was examined, and (4) evidence that City Wings continues to have the financial resources 

necessary to meet our financial fitness requirements.

Moreover, given the limited scope of City Wings’ proposed operations, we will impose certain 

limitations on its authorization to provide scheduled air transportation as a commuter air carrier. 

Our finding of fitness for City Wings is based on the operating plans described in its application, 

namely, utilizing aircraft that can be operated under Part 135. Should City Wings desire to 

acquire and operate larger aircraft that would require certification from the FAA under Part 121, 

our fitness findings, particularly involving the adequacy of City Wings management and 

financial resources, might no longer apply. Therefore, we propose to limit any authority issued 

to City Wings to operations conducted under Part 135. Should City Wings desire to operate 

aircraft that would require certification from the FAA under Part 121, it must first provide the 

Department with at least 45-days advance notice of such plans and provide updated information 

establishing its fitness for such expansion.

Furthermore, we remind City Wings of the requirements of 49 U.S.C. § 41110(e). Specifically, 

that section requires that, once an air carrier is found fit initially, it must remain fit in order to 

hold its authority. To be assured that commuter air carriers continue to be fit after effective 

authority has been issued to them, we require that they supply information describing any 

subsequent substantial changes they may undergo in areas affecting fitness. Therefore, if City 

Wings is issued an effective Commuter Air Carrier Authorization and should it subsequently 

propose substantial changes in its ownership, management, or operations, it must first comply 

with the requirements of section 204.5 of our rules.8 The compliance of the company with this 

requirement is essential if we are to carry out our responsibilities under section 41110(e).9

 

8 The air carrier may contact our Air Carrier Fitness Division to report proposed substantial changes in its 

operations, ownership, or management, and to determine what additional information, if any, will be required under 

section 204.5. In addition, by notice dated July 21, 1998, the Department requested air carriers to provide a 30-day 

advance notification of any proposed change in ownership, restructuring, or recapitalization. If the air carrier fails to 

file this updated information or if the information fails to demonstrate that the air carrier will continue to be fit upon 

implementation of the substantial change, the Department may take such action as is appropriate, including 

enforcement action or steps to modify, suspend, or revoke the air carrier's certificate authority.

9 We also remind City Wings about the requirements of section 204.7 of our rules. This section provides, among 

other things, that (1) the commuter authority granted to a company shall be revoked if the company does not 

commence actual flying operations under that authority within one year of the date of the Department's 

determination of its fitness; (2) if the company commences operations for which it was found fit and subsequently 

ceases such operations, it may not resume commuter operations unless its fitness has been redetermined; and (3) if 

the company does not resume operations within one year of its cessation, its authority shall be revoked for 

dormancy.
7

Additionally, if City Wings is granted effective authority, it would be required to submit a 

detailed progress report, within 45 days following the end of the first year of commuter flight 

operations, to the Air Carrier Fitness Division. The submission of a first year progress report 

was adopted as policy by the Department to aid in monitoring the fitness of new air carriers. The 

report should include a description of the air carrier’s current operations (number and type of 

aircraft, principal markets served, total number of full-time employees), a summary of how its 

operations have changed during the year, a discussion of any changes it anticipates from its 

current operations during its second year, current financial statements,10 and a listing of current 

senior management and key technical personnel. The air carrier should also be prepared to meet 

with staff members of the Fitness Division to discuss its current and future operations.

ACCORDINGLY,

1. We direct all interested persons to show cause why we should not issue an order finding that 

City Wings, Inc. d/b/a Seaflight is fit, willing, and able under 49 U.S.C. § 41738 to provide 

scheduled passenger service as a commuter air carrier using small aircraft pursuant to Part 135 of 

the Federal Aviation Regulations. 

2. We direct any interested persons having objections to the issuance of an order making final 

any of the proposed findings, conclusions, or award of authority set forth here to file them with 

Department of Transportation Dockets, 1200 New Jersey Avenue, SE, Room W12-140, 

Washington, D.C. 20590, in Docket DOT-OST-2010-0006 and serve them upon all persons 

listed in Attachment A no later than 14 days after the service date of this order; answers to 

objections shall be filed no later than 7 business days thereafter. 

3. If timely and properly supported objections are filed, we will accord full consideration to the 

matters or issues raised by the objections before we take further action.11

4. We will serve a copy of this order on the persons listed in Attachment A.

5. We will publish a summary of this order in the Federal Register.

By:

SUSAN L. KURLAND

Assistant Secretary

for Aviation and International Affairs

An electronic version of this document is available on the World Wide Web at:

http://www.regulations.gov

 

10 These financial statements should include a balance sheet as of the end of the company’s first full year of 

commuter flight operations and a 12-month income statement ending that same date.

11 Since we have provided for the filing of objections to this order, we will not entertain petitions for 

reconsideration.
Order 2012-7-22

Served: July 17, 2012

Attachment

Specimen

Terms, Conditions, and Limitations

CITY WINGS, INC.

d/b/a SEAFLIGHT

is authorized to engage in scheduled passenger air transportation operations as a commuter air 

carrier.

This authority is subject to the following provisions:

(1) The authority to conduct scheduled passenger operations will not become effective until 

six (business) days after the Department has received the following documents; provided, 

however, that the Department may stay the effectiveness of this authority at any time prior to that 

date:

(a) A copy of the holder's Air Carrier Certificate and Operations 

Specifications authorizing such operations from the Federal Aviation 

Administration (FAA).

(b) A certificate of insurance on OST Form 6410 evidencing liability 

insurance coverage meeting the requirements of 14 CFR 205.5(b) for all of its 

aircraft.

(c) A statement of any changes the holder has undergone in its ownership, key 

personnel, operating plans, financial posture, or compliance history, since the 

date of the Show Cause Order in this case.

(d) A revised list of pre-operating expenses already paid and those remaining 

to be paid, as well as independent verification that the holder has available to it 

funds sufficient to cover any remaining pre-operating expenses and to provide a 

working capital reserve equal to the operating costs that would be incurred in 

three months of operations.

(2) Pending receipt of effective authority, the holder may not accept payment of any kind 

(i.e., cash, check, or credit card) or issue tickets for scheduled passenger operations, and any 

advertisement or listing of flights by the holder must prominently state: "This service is subject 

to receipt of government operating authority." 

(3) The holder shall at all times conduct its operations in accordance with the requirements 

of 14 CFR Part 298 and any other regulations prescribed by the Department of Transportation 

for the services authorized here, and with such other reasonable terms, conditions, and 

limitations as the Department of Transportation may prescribe in the public interest.
2

(4) The holder’s authority is limited to operations conducted pursuant to Part 135 of the 

Federal Aviation Regulations. In the event that the holder wishes to institute operations that 

would require Part 121 certification from the FAA, it must first be determined fit for such 

operations.

(5) The holder may not operate aircraft designed to have a maximum passenger capacity of 

more than 60 seats or a maximum payload capacity of more than 18,000 pounds.

(6) The holder's authority under this certificate is effective only to the extent that such 

operations are also authorized by the FAA, and comply with all U.S. Government requirements 

concerning security, including, but not limited to 49 CFR Part 1544.

(7) The holder shall at all times remain a "Citizen of the United States" as required by 

49 U.S.C. § 40102(a)(15).

(8) The holder shall maintain in effect liability insurance coverage as required under 

14 CFR Part 205. Failure to maintain such insurance coverage will render this authority 

ineffective, and this or other failure to comply with the provisions of Subtitle VII of Title 49 of the 

United States Code or the Department's regulations shall be sufficient grounds to revoke this 

authority.

(9) In the event that the holder receives effective scheduled passenger authority, the following 

additional conditions will apply:

(a) The holder may reduce or terminate service at any point or between any 

two points, subject to compliance with the provisions of 49 U.S.C. § 41734 and all 

orders and regulations issued by the Department of Transportation under that 

section.

(b) The holder may not provide scheduled passenger air transportation to or 

from Dallas (Love Field), Texas, except within the limits set forth in section 29 of 

the International Air Transportation Competition Act of 1979, as amended or as 

modified by any future legislation addressing access restrictions to or from Love 

Field.. 

(10) Should the holder propose any substantial changes in its ownership, management, or 

operations (as that term is defined in 14 CFR 204.2(l)), it must first comply with the 

requirements of 14 CFR 204.5.

(11) In the event that the holder does not commence actual flying operations as a commuter 

air carrier under this authority within one year of the date of the Department's determination of 

its fitness, its commuter authority shall be revoked for dormancy. Further, in the event that the 

 

 To assure compliance with all applicable U.S. Government requirements concerning security, the holder shall, 

before commencing any new service (including charter flights) to or from a foreign airport, contact its Principal 

Security Inspector (PSI) to advise the PSI of its plans and to find out whether the Transportation Security 

Administration has determined that security is adequate to allow such airport(s) to be served.
3

holder commences but subsequently ceases all scheduled passenger operations, the authority 

granted here shall be suspended under the terms of 14 CFR 204.7 and the holder may neither 

recommence nor advertise such operations unless its fitness to do so has been redetermined by 

the Department. Moreover, if the holder does not resume such operations within one year of its 

cessation, its commuter authority shall be revoked for dormancy.
Order 2012-7-22

Served: July 17, 2012

Attachment A

SERVICE LIST FOR

CITY WINGS, INC.

D/B/A SEAFLIGHT

JASON E. MADDUX

GAROFALO GEORLICH HAINBACK PC

1200 NEW HAMPSHIRE AVE NW

SUITE 800

WASHINGTON DC 20036

PETER LYNCH AGC-300

ASST CHIEF COUNSEL FOR ENFORCEMENT

FEDERAL AVIATION ADMINISTRATION

800 INDEPENDENCE AVE SW

WASHINGTON DC 20591

WILLIAM J WEBER

CERTIFICATION SECTION MANAGER

FAA AFS-900

45005 AVIATION DRIVE SUITE 131

DULLES VA 20166

SERGIO LOPEZ

FSDO MANAGER

SOUTH FLORIDA FSDO 19

2895 SW 145 AVE SUITE 120

MIRAMAR FL 33027

OFFICE OF AIRLINE INFORMATION

DOT/RITA/BTS E-34

1200 NEW JERSEY AVE SE

WASHINGTON DC 20590

EUGEN JUSTICE

AVIAITON SAFETY INSPECTOR

SOUTH FLORIDA FSDO 19

2895 SW 145 AVE SUITE 120

MIRAMAR FL 33027