Order 2012

- 8

- 18 Served: August 17, 2012



### UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation on the 17 th of August, 2012

Essential Air Service at

EL CENTRO , CALIFOR NIA

Under 49 U.S.C. 41731 et seq

. DOCKET DOT

- OST

- 2008

- 0299

ORDER REQUESTING PROPOSALS Summary By this Order , the Department is requesting proposals by September 18 , 2012

, from carriers interested in providing Essential Air Service (EAS) at El Centro

, California

, for a new contract beginning January 1 , 201 3

, with or without subsidy.

Background By Order 20 10

- 12

- 6
, the Department selected SkyWest Airlines, Inc., d/b/a U nited Express , to provide EAS at El Centro , California, through December 31 , 2012. 1 Annual subsidy and service levels were set as 1 3 nonstop round trips per week to Los Angeles for $1, 852,091 annual subsidy, with 3 0

- seat Embraer Brasilia aircraft.
Request for Proposals As the end of the current rate term approach es , we are requesting proposals from carriers int erested in providing service at El Centro

, with or without subsidy, for a new contract beginning January 1, 2013 . Carriers should file their proposals by September 18, 2012

. S taff will then docket the proposals, thereby making them public. Shortly afterwards, we will provide a summary of the proposals to the community and S tate and as k them to submit their final comments. We will give full consideration to all proposals filed in a timely manner. 2 Interested carriers should p repare 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 the discretion to reject outri ght all unreasonable or unrealistic proposals and , if necessary, solicit a new round of proposals. However, we anticipate that negotiation or rejection will remain only occasional exceptions to the rule.

1 On March 1, 2011, SkyWest bega n basing its aircraft in El Centro, thereby providing the community with the early morning nonstop to Los Angeles the community had been seeking, and traffic increased

. 2 Carriers should not expect the Department to accept late filings. In cases where a c arrier 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 carrier

- selection case. Instead, we simply rely on that carrier’s subsidy

- free service as proposed.- 2

-

This Order provid es interested carriers with some basic information when they prepare their proposals, but we will not prescribe 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 ca n make their own judgments as to the level of detail they wish to present; 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 enc ourage clear, well

- documented proposals that will facilitate their evaluation by the affected community and the Department. We anticipate applying our usual carrier

- selection criteria and the general provisions governing subsidy payments for EAS

. 3

With specific respect to El Centro , we expect proposals consisting of two round trips per day (1 3 a week) if 3 0

- seat or larger equipment are pro posed; three (18 a week) or four (24 a week) round trips per day with 19

- seat aircraft ; and more frequencies with sm aller aircraft . We may subsidize additional frequencies if the affected community is served in conjunction with another community.

We encourage proposals that meet the community’s requirements in an efficient manner. Carriers are also welcome to propo se more than one service option, if they choose; they need not limit themselves to the current service pattern if they envision other, potentially more attractive service possibilities

– different hubs, or longer terms for the contracted service

– with sub sidy requir e ments that remain competitive.

We encourage carriers to work with the community in advance of the due date for proposals when proposals can still be adjusted so that they can craft them to best meet the community’s needs. As always, we will f ully consider the community’s views before making a long

- term carrier

- selection decision.

Filing Format 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 to be viewed online.

Historical Traffic In order to assist carriers in making their traffic and revenue projections, we have included historical traffic for the community in Appendix B

. For the year ended May 31

, 201 2

, El Centro generated 13,296 passengers, or 21 enplanements per day.

3 In selecting a carrier to provide subsidized EAS , 49 U.S.C. § 41733(c) (1) directs us to consider four fa ctors: (1) service reliability; (2) contractual and marketing arrangements with a larger carrier at the hub; (3) interline arrangements wi th 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 governing EAS will be included in the selection Order as part of our authorization of subsidy for the sele cted service. Appendix C of this Order contains those general provisions.- 3

-

Other Carrier Requirements The Department is responsible for implementing various Federal statutes governing lobbying activities, drug

- free workplaces

, and nondisc rimination. 4 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. Because the Department is prohibited from paying subsidy to carriers that do not submit these documents, the selected carrier will be required to submit them in order to receive subsidy. Interested carriers requiring more detailed information 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.

Community Comments Civic officials and the State 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 September 18 , the due date for carrier proposals.

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

- delegated to the Directo r, Office of Aviation Analysis.

ACCORDINGLY,

1

. The Department requests proposals from carriers interested in providing E AS at El Centro

, California . Carriers should submit their proposals, with subsidy if necessary, by September 18, 2012 . Proposals should be em ailed to EAS@dot.gov, with the title “Proposal to Provide EAS at El Centro

, Docket DOT

- OST

- 1997

- 2649

. ” Questions regarding filings may be directed to Kevin.Adams@dot.gov or 202

- 366

- 1047;

2

. Th is D ocket will rema in open until further o rder of the Department; and

3 . We will serve this Order on the s ervice l ist for th is Docket.

4 The certifications are available on the web at http://ostpxweb.dot.gov/aviation/index.html.- 4

-

Persons entitled to petition the Department for review of this Order under the Department’s Regulations, 14 CFR 385.50, must file such pe titions within ten (10) days after the date of service of this Order

.

This Order 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 Analysis ( SEAL)

An electronic version of this document is available on the World Wide Web at http://www.regulations.govAppendix A

Nonstop Great Circle Miles from El Centro , IPL YUM, Yuma 58 SAN, San Diego 94 LAX, Los Angeles 181 PHX, Phoenix 211 TUS, Tuscon 275

§Appendix B

Historical Passengers at El Centro/Imperial, California Per T-100 Market Report

Year Month Origin Dest O&D 2009 6 470 433 903 2009 7 381 398 779 2009 8 444 440 884 2009 9 399 477 876 2009 10 445 464 909 2009 11 458 482 940 2009 12 410 477 887 2010 1 428 446 874 2010 2 413 426 839 2010 3 502 518 1,020 2010 4 338 325 663 2010 5 424 403 827 YE 5/31/10 5,112 5,289 10,401

2010 6 401 360 761 2010 7 372 376 748 2010 8 356 423 779 2010 9 369 412 781 2010 10 392 433 825 2010 11 370 391 761 2010 12 386 468 854 2011 1 363 332 695 2011 2 387 428 815 2011 3 523 541 1,064 2011 4 494 526 1,020 2011 5 513 548 1,061 YE 5/31/11 4,926 5,238 10,164

2011 6 515 446 961 2011 7 471 510 981 2011 8 466 484 950 2011 9 583 602 1,185 2011 10 605 669 1,274 2011 11 614 626 1,240 2011 12 602 650 1,252 2012 1 518 486 1,004 2012 2 517 552 1,069 2012 3 585 608 1,193 2012 4 563 590 1,153 2012 5 517 517 1,034 YE 5/31/12 6,556 6,740 13,296Appendix C

Example of General Terms and Conditions fo r 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 eligibility for a fli ght 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 p eriod, 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 w riting 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 complete 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 goa ls 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 service requireme nts 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 that specific lo cation 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 cessati on 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 con trovert the foregoing paragraph.

Funds are not currently available for performance under this solicitation beyond [DATE]. The Department’s obligation for performance under this solicitation beyond [DATE], is contingent upon the availability of appropriat ed 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 ar e not made available for performance 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