ExemptionNo. 10466

UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION FEDERAL AVIATION ADMINISTRATION WASHINGTON, DC 20591

Inthe matter ofthe petition of

MNAirlines, LLC d/b/a Sun Country Airlines
for an exemptionfrom§ 93.123(a) ofTitle 14, Code of Federal Regulations Regulatory Docket 

### No. FAA-2012-0089

GRANT OF EXEMPTION By letter dated January 26, 2012, MN Airlines, LLC d/b/a Sun Country Airlines (Sun Country) petitioned the Federal Aviation Administration (FAA) for an exemption from Section 93.123(a) ofTitle 14, Code ofFederal Regulations (14 CPR). The proposed exemption, ifgranted, would grant to Sun Country two air carrier slots at Ronald Reagan WashingtonNational Airport (DCA) to operate between DCA and Lansing's Capital Region International Airport (LAN).
The petitioner requests relieffrom the following regulations: Subparts K and S of 14 CPRpart 93 prescribe special air traffic rules that apply to high density traffic airports (commonly known as the High Density Rule or HDR), which apply to DCA. Section 93.123(a) limits, in relevant part, the number ofinstrument flight rules (IFR) operations per hour at DCA to 3 7 for air carriers and 11 for commuter carrwrs.
The petitioner supports its requestwith the following information: ByDOT Order 2010-12-16 (dated December 10, 2010), the Department of Transportation (DOT) withdrew two DCAwithin-perimeter slot exemptions from Republic Airlines, Inc., which had beenusing them since its acquisition ofMidwest Airlines, and allocated those slot exemptions to Sun Country. Pursuant to that Order, Sun Country beganround-trip operations between DCA and LAN onApril 1, 2011. The slot exemptions awarded to Sun Country were in the II00 and 1400 time periods,2 but Sun Country operated flights in the 1000 and 1100 time periods following a slot trade with another carrier. OnJanuary 6, 2012, the U.S. Court ofAppeals for the District ofColumbia Circuit vacated DOT Order 201 0-12-16 and ordered the DOT to return the slot exemptions to Republic Airlines, Inc. 1

To continue its DCA-LAN service, Sun Country requests an exemption granting it one daily slot each in the 1000 and 1100 time periods.
Sun Country contends its DCA-LAN service has provided consumerbenefits by decreasing average fares and increasing the number ofpassengers served on that route. Sun Country asserts there is public consumer support for this service. SunCountry states it invested more than $500,000 in advertising, marketing, and startup costs after being awarded the slot exemption in reliance on long-term operation ofthe DCA-LAN service. Furthermore, Sun Country states the LAN airport authority and surrounding regional authorities made substantial economic investment in Sun Country's DCALAN service. Without a grant ofexemption, Sun Country argues these investments would be wasted because there are no other means for it to obtain DCA slots.
Furthermore, Sun Country maintains the FAApreviously granted exemptions to Part 93 for reasons similar to those presented where the slot availability is lost through no fault ofthe carrier. 

### See, e.g., ExemptionNo. 10063 (May 10, 2010) (granting to Air Canada an exemption from § 93.123 to permit the carrier to continue operating six commuter slots to and from DCA).
The FAA published a summary ofthis petition for exemption in the Federal Register for comment. 77 Fed. Reg. 5293 (Feb. 2, 2012). The commentperiod closed on February 22, 2012. As ofFebruary 28,2012, the FAA received 137 comments generally supporting a grant ofexemption, including aletter from Congressmen Mike J. Rogers and ajointletter from Senators Debbie Stabenow and Carl Levin. The FAA received one comment opposing a grant ofexemption, which is discussed in detail later inthis document.
The FAA's analysis is as follows: The FAA's standard for granting an exemption requires the petitioner to show (1) why granting the request is in the public interest (i.e., why it would benefit the public) and (2) why granting the request would not adversely affect safety or would provide an equivalent level ofsafety provided bythe rule. 14 C.P.R. § 11.81.

For this petition, the safety prong is not at issue. Air traffic control procedures ensure the safety ofoperations conducted at DCA regardless ofthe total number ofoperations authorized. Accordingly, the FAA fmds there is no adverse effect on safety.

1RepublicAirlines, Inc. v. U.S. Dep 'I ofTransp., No. 11-1018 (D.C. Cir. Jan. 6, 2012).3 Sun Country commenced DCA service using slot exemptions it acquired through a DOT proceeding. The Court's Order vacating those slot exemptions was beyond the control ofSun Country. Giventhe unusual circumstancespresented, it is inthe public interest to assist Sun Country in continuing its existing service and avoiding an inequitable result. As notedby commenters supporting this exemption, the loss ofSun Country's DCA-LAN service could detrimentally impactthe traveling public.

JetBlue Airways Corporation (JetBlue) filed comments opposing this exemption, arguing that current lawprecludes such an exemption. In support ofits position, JetBlue states the FAApreviously denied a JetBlue request to operate sevencommuter slots with larger aircraft thanpermitted underthe HDR. JetBlue also contends the FAA lacks authority to grant an exemptionfrom the HDRbeyond the statutorilycreated exemptions in 49 U.S.C. §41718. JetBlue distinguishes the currentpetition from the Air Canadapetitionbecause the Air Canadapetitionresulted in no net increase in operations at DCA. Finally, JetBlue contends granting an exemptionto Sun Countryundermines the investments madeby other carriers, including JetBlue, in acquiring DCA slots onthe secondary market.

The FAAhas considered JetBlue's arguments butis not persuadedbythem. JetBlue's request withrespect to the seven commuter slots, whichit did nothold atthe time of the request, is unrelated to the currentpetition. Under49 U.S.C. §41718, DOThas specific authority to grant exemptions to provide increased market access atDCA. However, this authority does not override the FAA's authority under49 U.S.C. § 40109 to grant exemptions from its rules whenthose exemptions are inthe public interest.2 The FAAhas used its broad exemption authority inthe slot context without controversy to address similar circumstances. See, e.g., ExemptionNo. 10063 (May 10, 2010) (granting to Air Canada an exemption from § 93.123 to permit the carrier to continue operating six commuter slots to and from DCA); ExemptionNo. 7434 (Feb. 1, 2001) (granting to Comair an exemptionfrom 

### § 93.218 to permit Delta Connection carriers to conduct domestic operations using slots designated for international operations andthereby preserve service to small communities); ExemptionNo. 5133 (Jan. 12, 1990) (granting to AmericaWest an exemption from§ 93.123 to permitthe carrier to continue operating four flights to and from DCA). Although JetBlue correctlypoints outthe Air Canadaexemption resulted in no net increase inDCA operations, thepublic interest served bythat exemption was to preserve existing service at DCA. Sun Countrypresents the same public interest. By granting this petition, the FAAwould preventthe inequitable result ofSun Country losing slot exemptions through no fault ofits own. Both Sun Country andthe flying public reasonably relied on continued DCA-LAN service under those exemptions. This grant ofexemptionwould maintain Sun Country's existing DCA service rather than introduce new operations at DCA. The FAArecognizes JetBlue's and othercarriers'

2 There is no statutory operational limit at DCA.4 investments in acquiring DCA slots, butit also must weigh Sun Country's investment in, and the public benefits from, the existing DCA-LAN service. Althoughthe slot times requested differ from those previously granted to Sun Country, the FAA fmds the difference does not significantly and detrimentally affect congestion and delays at DCA. Accordingly, the FAA finds that granting this request is inthe public interest.
The FAA's Decision: In consideration ofthe foregoing, I fmd that a grant ofexemption to MN Airline, LLC d/b/a Sun Country Airlines is in the public interest and would not adversely affect safety. Pursuant to the authority contained in49 U.S.C. §§ 40113 and 44701, delegated to me bythe Administrator, Sun Country is granted an exemption from 14 C.F.R. § 93.123(a) for the period beginning March 2, 2012, and terminating on March 31, 2014, unless sooner superseded orrescinded, and incorporating the following conditions and limitations: (1) A maximum oftwo total daily air carrier operations maybe conducted under this exemption. (2) Operations authorized by this grant ofexemption may be conducted only inthe following local hours: 1000 and 1100. The time periods ofeach operation maybe adjusted ifnecessary for air traffic control purposes. (3) This exemption authorizes operations only by Sun Country and by no other carrier. (4) Sun Country must use these slot exemptions to continue its DCA-LAN scheduled service permitted under DOT Order 2010-12-16. Sun Country must contact the FAA Slot Administration Office to confirm the scheduled operations and their frequencies underthis exemption. The Slot Administration Office will then provide slot identification numbers. (5) This exemption will be rescinded ifSun Country discontinues scheduled operations at Ronald Reagan WashingtonNational Airport.

### 5 (6) The operations authorized under this exemption are notpart ofthe pool of permanent slots at the airport. However, these operations, while in effect, are subject to the provisions of 14 C.P.R. part 93, subparts K and S, except that the authority may not bebought, sold, leased, or otherwise transferred, except through
an air carrier merger or acquisition. Sun Country may engage in temporary onefor-one trades ofthe authority to meet operational needs subject to the reporting requirements ofsubparts K and S.

Issued 

### in Washington, DC, onMarch 2, 2012.

Kathryn B. Thomson ChiefCounsel