Order 2014-9-22

Served: September 30, 2014

 

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 30th day of September, 2014

In the Matter of the

 SMALL COMMUNITY AIR SERVICE

 DEVELOPMENT PROGRAM

under 49 U.S.C. § 41743 et seq.

DOCKET DOT-OST-2014-0113

ORDER AWARDING GRANTS

Summary

By this Order, the U.S. Department of Transportation (the Department) awards 16 grants under 

the Small Community Air Service Development Program (Small Community Program) 

benefitting communities in 14 states to assist with the implementation of the air service 

initiatives proposed in their grant applications. The communities, the amount of funding 

awarded to the communities, and brief descriptions of the projects are listed in the Appendix to 

this Order. Award recipients must affirm their grant awards by entering into grant agreements

with the Department. Award recipients may not seek to be reimbursed funds under the Small 

Community Program until they affirm their grant awards.

Background

The Wendell H. Ford Aviation Investment and Reform Act for the 21st Century (AIR-21), Pub.

L. No. 106-181 (April 5, 2000), established a new pilot program, to be administered by the 

Department of Transportation, designed to help smaller communities enhance their air service 

and address issues related to high air fares.1 AIR-21 authorized the Small Community Program 

through FY 2003. Vision 100-Century of Aviation Reauthorization Act (Vision 100), Pub. L.

No. 108 (December 12, 2003), amended the program, reauthorized it through FY 2008, and 

eliminated the “pilot” status of the program. The FAA Modernization and Reform Act of 2012, 

Pub. L. No. 112-95 (February 14, 2012) authorized the program. Appropriations are provided 

 1 See Orders 2002-6-14 and 2003-9-14 for a complete description of the history of the Small Community Program.
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for this program for award in FY 2014 pursuant to the FY14 Omnibus Appropriations Act, Pub. 

L. 113-76 (Jan. 17, 2014). For the 2014 grant awards, the Department has $7 million to carry out 

this program.

When selecting applicants to participate in the Small Community Program, the Department is 

statutorily required to apply the following eligibility criteria:

1. As of calendar year 1997, the airport serving the community was not larger than a small 

hub airport, and had insufficient air carrier service or had unreasonably high air fares;

2. The airport presents characteristics, such as geographic diversity or unique circumstances 

that demonstrate the need for, and feasibility of, the Small Community Program;

3. An applicant may not receive an additional grant to support the same project;2 and

4. An applicant may not receive an additional grant prior to the completion of its previous 

grant.3 

The statute further provides that no more than four communities or consortia of communities, or 

a combination thereof, from the same state may be selected to participate in the program in any 

fiscal year, and no more than 40 communities or consortia of communities, or a combination 

thereof, may be selected to participate in the program in each year for which the funds are 

appropriated.

In addition, the law directs the Department to give priority to those communities or consortia of

communities4 where: (a) air fares are higher than the average air fares for all communities; (b) a 

portion of the cost of the activity contemplated by the community is provided from local, nonairport revenue sources; (c) a public-private partnership has been or will be established to 

facilitate air carrier service to the public; (d) improved service will bring the material benefits of 

scheduled air transportation to a broad section of the traveling public, including businesses, 

educational institutions, and other enterprises whose access to the national air transportation 

system is limited; (e) the funds will be used in a timely manner;5 and (f) multiple communities 

cooperate to submit a regional or multistate application to consolidate air service into one 

regional airport.6

The Department is authorized to award grants to communities that seek to provide assistance to:

• An air carrier to subsidize service to and from an underserved airport for a period not to 

exceed three years;

• An underserved airport to obtain service to and from the underserved airport; and/or

• An underserved airport to implement such other measures to improve air service both in 

terms of the cost of such service to consumers and the availability of such service, 

 2 However, as stated in our Request for Proposals (Order 2014-6-17), previous grant recipients could submit grant 

proposals and seek funds for new projects. See Order 2014-6-17 for a discussion on same projects.

3 49 U.S.C. § 41743(c).

4 A consortium of communities is defined as a single entity. 49 U.S.C. § 41743.

5 49 U.S.C. § 41743(c)(5)(E).

6 49 U.S.C. § 41743(c)(5)(F).
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including improving air service through marketing and promotion of air service and 

enhanced utilization of airport facilities.7

On June 30, 2014, the Department issued an Order Soliciting Small Community Grant Proposals 

(Solicitation Order) from communities interested in receiving grant funding this year, and 

requested that such proposals be filed no later than July 31, 2014 (Order 2014-6-17). The 

Solicitation Order required each applicant to submit a completed Standard Form 424 and a

Summary Information schedule to www.grants.gov. Communities were requested to provide 

information that would help in the consideration of their grant requests, including details about 

their existing air services, historical air services, current air service needs and deficiencies, a full 

description of the community’s proposal, plans for implementation, funding requirements, and 

plans for monitoring the success of the project, including modifying or discontinuing funding if 

the project is not meeting expectations.

Drawing on the Department’s learnings and experience from previous years, the Solicitation 

Order discussed various issues relating to project types and the grant application process, 

including the sources of local funding, the consideration of in-kind contribution, the use of grant 

funds, and the eligibility to participate by past grant recipients and communities now receiving 

subsidized air service under the Essential Air Service (EAS) program. The Solicitation Order 

further emphasized that communities would be expected to meet the financial-contribution 

commitments that they include in their proposals.

2014 Grant Applications

In response to the Solicitation Order, the Department received 52 total grant applications from 

communities in 27 states. Collectively, these communities sought more than $24 million in 

Federal assistance to support new and ongoing air service development projects. Most of the 

applications were filed by individual communities, with one filed by a consortia of communities. 

Of the 52 applications, eight applications were from communities with small-hub airports and 

three were from communities now receiving subsidized air service under the Department’s EAS

program. Nine of the 52 applications did not meet the basic eligibility criteria for participation 

outlined above and were determined ineligible in whole or in part for consideration. Of these 

applications, most were found ineligible because the applicant sought additional funding for the 

same, or essentially the same, project that was funded in a previous grant. Others were found 

ineligible due to missing the stated deadline to submit applications as outlined in the Solicitation 

Order.

As in previous years, this year’s eligible applications included proposals for feasibility studies, 

new or expanded service initiatives, service upgrades, and assorted combinations thereof. These 

applicants provided information on historical and current air service and airfare issues facing 

their communities, the economic benefits of air service, proposed initiatives to remedy air 

service or airfare problems, and arguments in support of their proposals. Nearly all the 

communities pledged local cash and/or in-kind contributions from local, state, airport, or private 

sources to complement their requests for Federal assistance.

 7 49 U.S.C. § 41743(d).
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The large majority of applicants specified the need to attract new and/or additional air services to 

their communities. Similar to previous years, a majority of applicants also proposed to 

implement their projects using revenue guarantees or subsidies, together with a variety of 

marketing and promotional initiatives. A critical component of most proposals was funding to 

support community-based marketing and promotional initiatives to stimulate demand and 

community awareness of local airport services. These efforts are directed at publicizing not only 

the availability of air services, but also the convenience of using the local airport compared to 

more congested air service hubs or other larger airports in the region. Many applicants argued 

that certain industry changes – including network rationalization due to air carrier consolidation, 

phase-outs of smaller regional jets due to higher operating costs, and a pilot shortage 

constraining the ability of air carriers to enter new markets – made the need for Federal

assistance more critical and would help the communities compete for new services and retain 

current services.

2014 Grant Awards

The Small Community Program is unique in that it encourages and affords communities the 

opportunity to develop their own solutions to their air service problems based on their particular 

needs and circumstances. By providing communities the opportunity to develop and implement 

air service projects tailored to their individual needs, the program aims to maximize the potential 

for success in the communities’ endeavors. Since the program’s inception, the Department has 

sought to maximize the number of participating communities, promote geographic diversity of 

the selections, and support a variety of solutions to the problems identified by applicants in order 

to provide a wide range of approaches for dealing with the challenges faced by similarly-situated 

communities.

With these considerations in mind, we are selecting 16 grant proposals with the objective of 

entering into grant agreements with the communities/consortia identified in the Appendix to this 

Order. Award recipients must enter into grant agreements with the Department before the 

recipients may seek to be reimbursed expenses under their Small Community Program projects. 

In addition, grant recipients are subject to all grant conditions and assurances required by Federal

law, regulations, and executive orders.8 The Department’s grant agreements will be transmitted 

to the selected communities subsequent to the issuance of this Order.

The proposals we selected incorporate the purpose of the statute, and provide opportunities to 

test a variety of approaches to improving small community air service in many regions of the 

country. The attached Appendix provides a brief description of each project and the amount of 

funding each community requested. As an overview:

• Eleven (11) of the awards are made to communities proposing a revenue guarantee and/or 

marketing support as means to attract new carriers, restore lost service or capacity, and/or 

provide air travelers with access to additional markets. These communities are: 

Redding, California; Panama City, Florida; Columbus, Georgia; Boise, Idaho; Moline, 

 8 See http://www.dot.gov/policy/aviation-policy/small-community-rural-air-service/SCASDP for applicable 

conditions and assurances.
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Illinois; Columbus, Mississippi; Gulfport-Biloxi, Mississippi; Bozeman, Montana; 

Roswell, New Mexico; Cheyenne, Wyoming, and Sheridan, Wyoming.

• Two (2) grants will be used by EAS communities to market the existing air 

service. These communities are Watertown, New York and Eau Claire, Wisconsin.

• Three (3) grants will be used to market existing air service at airports in Montgomery, 

Alabama, Yakima, Washington, and Rapid City, South Dakota.

All of the selected communities are contributing financial resources to their respective grant 

projects. In addition, many communities have pledged in-kind contributions in further support of 

their air service initiatives. The local contributions reflect a commitment that is important to the 

potential success of the proposed initiatives. Moreover, nearly all of the communities have 

(1) established robust public-private partnerships to enhance community participation and 

facilitate access to air services, (2) provided a specific plan and timetable for using their grant 

funds in a timely manner, and (3) provided a letter of support from an interested air carrier.

Air Service Development Zone

The statute directs the Department to designate an airport in one community awarded a grant 

under this program as an “Air Service Development Zone” (ASDZ), and to work with the 

community or consortium on means to attract business to the area surrounding the airport, to 

develop land-use options for the area, and to provide data, working with the Department of 

Commerce and other Federal agencies. 49 U.S.C. 41743(h). A current grant recipient remains 

active as the Department’s ASDZ designee for the program. As a result, the Department did not

solicit applications for selection as an ASDZ designee in FY14.

Grant Agreements

As noted above, the Department will execute grant agreements with each recipient. The 

Department stated in the Solicitation Order that communities must establish milestones to 

monitor the progress of the proposed projects to determine whether amendments are necessary or 

whether the grant agreement should be terminated. As done in the past, milestones and progress 

reporting requirements will be included in the grant agreements. Federal funds under this grant 

program are disbursed on a reimbursable basis, with the communities expending funds for the 

grant project and then seeking reimbursement. In seeking reimbursements, grant recipients must

provide invoices or other evidence of the expenditure, details about the expenditure and how it 

relates to the grant project, and evidence of payment. In addition, the legal sponsor is required to 

certify that each invoice is relevant to the authorized grant project and has been paid. 

Communities will be required to comply fully with the terms of their proposals and the grant 

agreements.
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ACCORDINGLY,

1. We select the communities listed in the Appendix to receive grant awards under the 

Small Community Air Service Development Program as described in this Order;

2. Grant recipients shall be subject to all grant conditions and assurances that will be 

attached to and incorporated in the grant agreements (also available at 

http://www.dot.gov/policy/aviation-policy/small-community-rural-airservice/SCASDP). In addition, to the extent that the grant agreement permits 

expenditure of the awarded Small Community Program funds in any manner that would 

not be permitted for funds received as part of Federal Aviation Administration’s Airport 

Improvement Program (AIP), such permission is strictly limited to the expenditure of the 

Small Community Program funds awarded under the grant agreement. Nothing in the 

grant agreement negates the recipient’s obligations to fully comply with FAA Order 

5100-38C;

3. Each award recipient must affirm this award by entering into a grant agreement with the 

Department. Award recipients may not seek to be reimbursed under the Small 

Community Program until they affirm their grant awards; and

4. A copy of this Order will be served on the legal sponsor for each of the communities 

awarded grants.

By:

SUSAN L. KURLAND

 Assistant Secretary for Aviation

 and International Affairs

(SEAL)

An electronic version of this document is available

at http://www.regulations.gov
State Community Federal Amount 

Awarded Project Description

Alabama Montgomery $200,000

The funding will be used for a marketing campaign to promote existing air service at 

Montgomery Regional Airport, an airport with three scheduled nonstop flights. The 

community believes that the marketing campaign is necessary to strengthen the airport brand 

and promote awareness in the catchment area, whose residents otherwise have to travel 

more than two hours for medium or large hub access. This will lead, the community hopes, to 

increased enplanements and more service opportunities in the future.

California Redding $450,000

The funding will be used for a revenue guarantee for SkyWest Airlines, the sole air service 

provider at Redding Municipal Airport offering three daily roundtrips to San Francisco 

International Airport, with the objective of upgrading the existing turboprop aircraft to 

regional jets. The community is concerned that the industry-wide reduction of smaller 

turboprop service puts its air service at risk, and is hoping to preserve the service as well as 

offer its air travelers increased seat capacity. 

Florida Panama City $400,000

The funding will be used to provide marketing support for new daily JetBlue Airways service 

between Northwest Florida Beaches International Airport and John F. Kennedy International 

Airport. With the new nonstop service to New York, a top unserved O&D market for the 

catchment area, the community seeks to broaden the air carrier base at the airport and 

provide downward fare pressure.

Georgia Columbus $750,000

The funding will be used to provide a revenue guarantee and marketing support to attract a 

second air carrier to Columbus Airport, targeting American Airlines (AA) service to Charlotte 

Douglas International Airport. The community seeks the new service to bring additional 

capacity to the airport following the cancellation of AA’s service to Dallas-Ft. Worth 

International Airport and the subsequent loss of 49% of the airport’s capacity. The community 

believes the new service will help reduce fares and benefit local air travelers who would 

otherwise need to drive about 90 miles to the nearest large hub airport. 

Idaho Boise $700,000

The funding will be used to provide a revenue guarantee and marketing support for new 

service from Boise Airport to an East Coast hub, targeting Delta Air Lines to Hartsfield-Jackson 

Atlanta International Airport. The community seeks to increase capacity at the airport and 

address an air service access deficiency to the commercial and high-tech centers on the East 

Coast, with which the community states it has increasing economic ties. 

Appendix Order 2014-9-22 
State Community Federal Amount 

Awarded Project Description

Appendix Order 2014-9-22 

Illinois Moline $500,000

The funding will be used to provide a revenue guarantee and marketing support for new 

service from the Quad City International Airport, targeting nonstop service to the Washington, 

D.C. area. The Quad Cities community, facing declining enplanements and capacity at the 

airport after AirTran’s departure from the market, believes nonstop service to Washington, 

D.C. will strengthen and increase economic development efforts and help meet consumer 

demand for connecting opportunities on the East Coast. 

Mississippi Columbus $750,000

The funding will be used to recruit new service from the Golden Triangle Regional Airport to a 

westbound air gateway using revenue guarantees, start-up cost offsets, and marketing, 

focusing on service to Dallas-Ft. Worth International Airport, Houston George Bush 

Intercontinental Airport, or Denver International Airport. The community seeks to address the 

lack of direct westbound access, as all travel to points in the Western U.S. require lengthy backtracking connections over Atlanta.

Mississippi Gulfport $350,000

The funding will be used to provide a revenue guarantee and marketing support for new lowfare service at the Gulfport-Biloxi Regional Airport to Minneapolis-Saint Paul International 

Airport, targeting Sun Country Airlines. The community seeks to provide lower fares and 

access to underserved markets with the new service, as well as reduce the decline in traffic at 

the airport. 

Montana Bozeman $750,000

The funding will be used for a revenue guarantee and marketing support to attract new 

service from Bozeman Yellowstone International Airport (BZN) to Dallas-Ft. Worth 

International Airport, targeting American Airlines. The community states that high load 

factors on flights from Salt Lake City and Denver connecting through BZN mean that local 

passengers have limited seating availability, and the community believes the additional 

capacity from the new service will stimulate inbound passenger travel and help reduce air 

fares.

New Mexico Roswell $450,000

The funding will be used for a revenue guarantee and marketing support to acquire nonstop 

westbound service from the Roswell International Air Center (ROW) to a major connecting 

hub, targeting service by American Airlines to Phoenix-Sky Harbor International Airport. The 

community states that, from ROW, Southeast New Mexico air travelers endure circuitous 

routing to western markets, and thus longer travel times and higher travel costs, to fly local, or 

they drive significant distances to alternative airports. The community believes the new 

service will provide additional connecting opportunities at a major hub, as well as add capacity 

at the airport and address passenger demand for westbound travel.
State Community Federal Amount 

Awarded Project Description

Appendix Order 2014-9-22 

New York Watertown $235,000

The funding will be used for marketing support of the existing Essential Air Service (EAS) at 

Watertown International Airport, which is one scheduled nonstop flight to Philadelphia 

International Airport provided by American Airlines. The community seeks to continue the 

trend of improving load factors and reduce leakage with the marketing support, believing that 

the community outreach activities will enhance the airport’s brand and increase 

enplanements. 

South Dakota Rapid City $325,000

The funding will be used to provide marketing support for the expansion to daily, year-round 

service of current seasonal, Saturday-only service to Hartsfield-Jackson Atlanta International 

Airport on Delta Airlines. The community believes the improved air service will increase 

capacity at the Rapid City Regional Airport and reduce the rate at which the airport’s average 

fare increases, benefiting area air travelers who live 390 miles or more away from major 

metropolitan areas.

Washington Yakima $290,000

The funding will be used to provide a revenue guarantee and marketing support for new daily 

service from Yakima Air Terminal-McAllister Field to Portland International Airport (PDX), as 

well as marketing and traffic studies to increase demand for the existing Alaska Airlines 

service. The community is geographically isolated, surrounded by mountains that make 

surface transportation difficult in the winter, and the airport is experiencing reduced 

scheduled frequencies. The community believes the new service will address passenger 

demand for service to PDX, and the marketing will help increase enplanements and support 

the continuation of its existing Alaska Airlines service to Seattle-Tacoma International Airport. 

Wisconsin Eau Claire $150,000

The funding will be used for a marketing project to build awareness of the existing EAS service 

currently provided at Chippewa Valley Regional Airport by SkyWest Airlines to Chicago O'Hare 

International Airport. The community seeks to retain and increase traffic at the airport, while 

reducing leakage. 

Wyoming Cheyenne $200,000

The funding will be used to provide a revenue guarantee and marketing support for new 

nonstop air service from Cheyenne Regional Airport to a large hub airport. The community 

seeks to provide reliable air service for local air travelers in the catchment area of the state 

capitol. The community believes it is at risk for losing air service, given the rising air fares and 

reduced frequency and capacity at the airport. With new air service, the community hopes to 

meet passenger demand for service to a large hub while increasing local utilization of the 

airport and pressuring air fares downward.
State Community Federal Amount 

Awarded Project Description

Appendix Order 2014-9-22 

Wyoming Sheridan $500,000

The funding will be used to provide a revenue guarantee and marketing support for new 

nonstop air service from Sheridan County Airport to a large hub. The community seeks 

reliable air service for local air travelers who are more than a six-hour drive to either a large 

hub or an airport offering substantial low-fare service, and who are enduring fluctuating 

frequencies with the current service offered at the county airport. The community believes 

new air service would improve passenger retention at the airport and help reduce air fares.