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Marketing Coordinator I Great Lakes Airlines

Office 307-432-7000 I Fax 307-432-7001

www.FlyGreatLakes.com I KAnderson@f1ygreatlakes.com

Great lakes Airlines to Suspend Air Service at Devils lake and

Jamestown, North Dakota; Fort Dodge and Mason City, Iowa;

Ironwood, Michigan; and Thief River Falls, Minnesota.

CHEYENNE, Wyo., January 27,2014 - Great Lakes Aviation, Ltd. (OTC Bulletin Board:

GLUX.OB - news) Effective February 1,2014, Great Lakes Airlines will be suspending service

from Devils Lake and Jamestown, ND; Fort Dodge and Mason City, IA; Ironwood, MI; and Thief

River Falls, MN due to the severe industry-wide pilot shortage and its relative acute impact on

Great Lakes.

Charles Howell, CEO released the following statement: "Due to the unintended consequences of

the new congressionally mandated pilot regulatory requirements, the Company feels it is in the

best interest of our customers, communities, and employees to suspend service from these

stations until we are able to rebuild our staff of pilots in order to provide reliable service. We

deeply regret and apologize for this inconvenience."

All customers with future fiights in any of these stations will be given refunds. Please begin your

refund efforts with your initial booking source.

For more background information regarding how the regulatory changes have affected Great

Lakes' unique role in the airline industry, please visit our website at www.FlyGreatLakes.com

###

Great Lakes Airlines provides scheduled passenger air service with a fieet of Embraer EMB-120 Brasilia's

and Beechcraft 19000 regional airliners. A current route map may be viewed at:

http://www.fiygreatlakes.com/route_map/Oocs/route_map.pdf

Additional information is available on the Company web site that may be accessedat

www.flygreatlakes.com

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TOM HARKIN

IOWA

The Honorable Michael Huerta

Administrator

Federal Aviation Administration

800 Independence Avenue, SW

Washington, DC 20591

Dear Administrator Huerta:

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tlnitcd ~UltfS ~cnatt

WASHINGTON, DC 20510-1502

April 15,2013

(202) 224-3254

FAX: (202) 224-S369

TTY: 12021 22&-9810

http://harkin.senBte,gov

COMMrt1'£ES:

HEALTH, EDUCATION,

LABOR, AND PENSIONS. CHAIR

APPROPRIATIONS

AGRICULTURE

SMALL BUSINESS

I write to express my concemregarding the FAA's proposed 1,500 flight hour

requirement for co-pilots, which is scheduled to take effect in August 2013, because it will likely

disrupt the ability of small and regional airlines to retain adequate numbers of pilots for

scheduled flights. According to people with knowledge of the industry, the memes of hours

spent in classroom instruction and in flight simulators are superior to the flight time requirement.

I urge the FAA to move forward with regulatious which would allow the use of these alternative

training methodologies in lieu of flight hours.

This burdeusomerequirement comes at a time when the availability of neW pilots to

small and regional airlines is increasingly constrained by market factors. Rapid growth in the

global aviation sector has lured significant numbers of U.S. pilots to work for foreign carriers.

Furthermore, the supply of new pilots has also declined as the number of pilots leaving the

military has dropped in recent years and the number of new commercial pilot certificates

awarded has declined by almost 50 percent in the last 20 years. Enrollment in accredited

aviation and commercial flight schools has also declined, perhaps partly due to the expectation of

the increased cost of training associated the 1,500 hour flying time requirement. One regional

airline has reported to me that they are experiencing a sharp drop in applications despite offering

significant signing bonuses. The supply of new pilots has been further restricted as a result of

new flight and duty time regulations that have forced airlines to increase the number of

employed pilots needed to maintain their current flight schedules.

The combination of these factors will result in an especially severe shortage of pilots

available to regional and smaller airlines. Larger carriers, who are able to offer better

compensation, will recruit more pilots from regional carriers. These carriers will, in turn, ramp

up their recruitment of pilots from smaller carriers.

There are already signs that this issue is beginning to have a deleterious impact on the

ability of small carriers to maintain service at current levels. For example, I know of at least one

small carrier that is starting the process of using Part 135 rules in eXpeCtation of a shortage of co111 7TH AVENUE SE, BOX 16

SUITE 480

CEDAR RAPIDS, IA 52401

(3191 365-4504

210WALNVT STREET

133 FEDERAL BUILDING

DES MOINES, IA 50309

1515) 284-4574

1606BRAOY STREET

SUITE 323

DAVENPORT. IA 52603

15631322-1338

350 WEST 6TH STREET

315 fEDERAL BUILDING

DUBUOUE. IA 52001

15631 582-2130

320 6TH STREET

110 fEDERAL BUILDING

SIOUX CITY. IA 51101

17121252-1550
..

pilots resulting from Part 121 Ru1es. This process may involve capping the number of

passengers at nine regardless of the size of the aircraft, an approach the FAA will hopefully

allow. In the case of carriers not receiving Essential Air Service (EAS) subsidy, service on these

routes cou1d eventually cease altogether. For those receiving an EAS subsidy, costs will likely

increase and the quality of service may decrease. While the initial impact of the shortage may be

limited to smaller cities, as the situation grows worse larger cities could experience major loss of

service as well.

In the long term, we need a better pipeline to encourage more individuals to choose the

quality, high-paying jobs that a career as apilot in the commercial airline industry can offer. In

order to accomplish this, however, I think it is crucial for the FAA to act as quickly and as

broadly as possible to mitigate the problems that small and regional carriers will face as the

1,500 hour requirement takes effect.

Thank you for consideration of this matter. If you have any questions regarding my

request, please feel free to contact Richard ~ender on my staff at 202-224-7318 .

•

Tom Harkin

United States Senator
April 8, 2013

Mr, Dale Ogden

CMOManager

Certificate Management Office

26805 East 68th Avenue Suite 234

Denver, Colorado 80249-6339

Mr, Ogden:

In light of the pending regulatory changes for crewmember qualifications and the uncertainty of any relief from the

Administrator with regard to Airline Transport Pilot (ATP) certification requirements, the Company must address

the pilot shortage that exists today. The supply, or lack thereof, of qualified applicants is causing the Company to

begin planning reductions in capacity to the communities it serves,

Great Lakes is essentially being forced to consider pursuing some "outside tbe box" options to maintain air service

at many points witbin the current route structure, One option wbicb the Company is considering is the development

of a "split operating certificate" whereby some operations would be performed under the current 121 certificate and

others would be performed under a scbeduled "9 or less" 135 certificate. The Company previously utilized a split

certificate from 1997 tbru June of2004 to provide air mail and freight services in Beech 1900 aircraft.

Currently all Great Lakes scheduled operations are conducted with aircraft having a seating capacity of nineteen or

more passengers all of which are performed in accordance with Title 14 CFR Part 121 (Part 121). An alternate

method of maintaining community access to the National Transportation System would be to operate aircraft having

a seating capacity of nine or less that would be conducted in accordance with Title 14 CFR Part 135 (Part 135). The

operating rules for both Parts are quite, similar and in accordance with Title 14 CFR part 119.5 an operator

authorized to engage in common carriage under Part 121 and/or 135 shall be issued only one certificate regardless of

tbe kind of operation, class, or size of aircraft to be operated.

At this time Great Lakes would respectfully request the Denver Office to initiate the steps required to add a Part 135

authorization to its existing certificate. Great Lakes proposes to operate both flight operations (Part 121 and 135)

with the same "highest degree of safety" and utilize common programs between the two operations making them as

seamless as possible with the only visible difference being one operation would be conducted with an aircraft

limited to no more than nine passengers, Great Lakes will block ten (10) seats on its Beechcraft 19000 aircraft to be

in compliance with the nine seat limitation for scheduled 135 nine or less operatioDS,

With that in mind we have included a short list of programs with our thoughts on their applicability to a Part 135

Operation, This list is meant to initiate a discussion between our offices and should not be considered complete.

We look forward to your comments.

R~:J

Tory A. Meisel

Director of Operations

Enclosure: Programs and Manuals
Pilot safety rules could cut flights - Jan. 9, 2014

." •

Page 100

Pilot safety rules could cut flights

By Chrts tsidore @CNNMoney J8r'lU8ry 9, 2014: 10;01 AM ET

New rules to give pilots more rest could mean there aren't enough pilots to fly the regional jets that are used on about half of the nation's flights.

28

TOTAL SHARES

20 2 6

NEW YORK (CNNMoney)

New safety rules that played a part in JetBlue Airways' epic meltdown this week could further stretch the industry's supply of

pilots, and cause problems at local airports nationwide.

That's because busy regional airlines, which carry a big chunk of all U.S. passengers, are particularly vulnerable to the same

rules that felled Jet Blue ( JBLU, Fortune 500).

At issue is an FAA policy that went into effect on Saturday requiring more rest for pilots.

Experts say the rules will mean more flight cancellations in bad weather, since weather-related delays will eat up the fixed

number of hours that pilots are allowed to be on duty.

More downtime will also exacerbate an existing shortage of pilots, which could eventually cost some cities service altogether.

Many major airlines are not really affected by the rules because their union contracts already require similar rest periods for

pilots. But JetBlue's pilots are not in the union, so the carrier had to make adjustments when bad weather backed up flights.

And many regional carriers might have to follow suit. While many of them are unionized, their pilots don't have the same

strong contracts as those at the major carriers. Sothey too will have to start giving pilots bigger breaks.
.' . ~

Pilot safety rules could cut flights - Jan. 9,2014 Page 3 of3

Darby said it's too soon to say which cities are at risk of losing air service altogether. He believes eventually the airlines will

have to decide which cities are no longer profitable enough to justify using the limited supply of pilots.

"It's not something that typically happens the day the rule takes effect," he said. "But it will happen when the regionals run out

of pilots." •

First Published: January 9.2014: 9:58AM ET
US Senate - Committee on Commerce, Science and Transportation

Great Lakes Aviation - Pilot Shortage background material - 12-11-13

On April 8th of this year, Great Lakes submitted a written proposal to the FAA which would enable Great

Lakes to operate Beechcraft 1900-D aircraft limiting the number of passengers carried to nine passengers

under FAR 135 (see attached letter to the FAA). Our proposal was then specifically targeted to provide

Essential Air Service at the Minneapolis/St. Paul (MSP) hub whereby all segments of the operation would

remain in compiiance with FAR 121 operational standards with the exception being our need to be able to

use FAR 135 piiot hiring standards. This proposal would enable Great Lakes to access to a highly

qualified, well trained pool of pilots that do not possess the 1,500 hour Airline Transport Pilot FAR 121

credentials. A pool of Pilots that the company has historically had over 32 years of access to.

In July of this year, Great Lakes met with representatives of all the EAS communities served by Great

Lakes into its MSP hub. The meeting served as a multi-faceted communication forum addressing the

unintended consequences of the implementation of the 1,500 hour ATP rule. At the time of the meeting,

the FAA had yet to release the long anticipated exemption rules that were to be set to facilitate exceptions

to the 1,500 hour ATP rule.

Great Lakes had been confronting a sharp reduction in its eligible pilot hiring pool availability that was a

byproduct effective of the August 1, 2013 1500 hour ATP rule implementation date. In anticipation of the

new rule, in the fall of 2012, the company had hired a significant number of pilots that became qualified

under our then current FAR part 121 training process. It was believed then that these Pilots would have

received enough flight time experience to become eligible to fly beyond August 1" under the anticipated

new exemption rules.

The FAA released the exemption rules two days after this community meeting. Unfortunately, the design

of the exemption rule procedures did not facilitate for all pilots on staff to be eligible to fly on August 1'I.

The delay in the release of the rules and the corresponding certification process postponed completion of

recertification for many pilots that had been flying for the airline under Part 121 for many months in

advance of the August 1" transition date.

No grandfathering relief for on staff FAR 121 pilots was granted by the FAA. These events forced Great

Lakes to remove a significant amount of capacity from its system in the early days of August. The

company had substantially over staffed its pilot requirements prior to the rule change and still came up

short on the transition date.

As the airline industry transitioned through the August 1" 1,500 ATP rule change, the industry refocused

on preparing for the FAR part 117 flight duty time rule change to be implemented on January 4,2014.

Due to the lack of qualified pilots outside of the existing FAR part 121 air carrier staffing levels, Great

Lakes pilots became immediate targets for aggressive hiring by other regional and major air carriers.

Pilot attrition rates have exceeded new hire piiot recruiting capabilities by more than 20 fold. The attrition

rates have resulted in aggressive near term capacity reductions that have been and will continue to be

required to be made by the company. Further planned system wide schedule reductions have now placed

Great Lakes in a position whereby it is being forced to reduce EAS flying below traditional EAS

community capacity expectations.
•

The new regulatory requirements imposed on all FAR Part 121 air carriers regarding pilot training and

hiring eligibility requirements have dramatically accelerated a pilot shortage crisis that the airline industry

has anticipated and has been allempting to address for several years.

Capacity reductions following the events of September 11, 2001 had reduced pilot staffing demands in

subsequent years, but the effects of this reduction in capacity has run its course relative to currently

available qualified pilots.

In the three years since the congressionally mandated hiring standards were established an inadequate

numbers of pilots have been building the experience and skills necessary to meet the industry's future

needs. Single pilot certified FAR part 135 operators are not required to staff copilots and hence do not

provide the Industry a meaningful progression of pilot development out of collegiate accredited pilot

training programs.

The pilot has been left on his own to find the necessary additional 500 to 1,000 hours of flight experience

that facilitates eligibility into the airline industry. Purchasing the additional time flying around the airport

pallem in Cessna 150's does very lillie to advance safety standards in the airline industry.

The traditional pipeline of FAR part 121 nineteen seat turboprop aircraft operators' virtually no longer

exists. We find it interesting that the NTSB is now focusing on hand flying skills while the regulatory

environment has eliminated were these skills had historically been developed. FAR part 135 single pilot

Instrument Flight Rule operations require the use of an autopilot since no copilot is required and hence

does nothing to assist in growing pilot hand flying experience levels within the industry.

Most former operators of FAR part 121 nineteen seat aircraft recognized years ago that the pilot pool

competing with regional jet equipment would not facilitate pilot retention under the same hiring standards.

Congress must recognize that the unintended consequences of the new congressionally mandated hiring

standards has been the virtual elimination of the traditional pilot career path.

The combination of pilot allrition in past years and the new pilot hiring standards which established a

1500 hour experience standard along with Airline Transport Pilot Certification (ATP) for all FAR Part 121

operations has created a "perfect storm" within the airline industry relative to the availability of qualified

pilots operating within a FAR Part 121 environment.

Throughout the course of the last three years the company has repeatedly communicated with US DOT

expressing our concern regarding our ability going forward to cover all EAS flying post implementation of

the new rules. Our greatest fears have become realized.

The pilot shortage threatens future EAS community eligibility by reducing enplanements as measured

against time. As we pull down schedules seat capacity falls below traditional availability levels producing

enplanement numbers that will trigger EAS eligibility reviews and subsequent removals from the program.

The reduced enplanementlevels will also threaten Airport Improvement Program grants and entitlements.

Communities will need waivers by Congress in order to maintain historical levels of Airport infrastructure

investment support.

This is not just a Great Lakes problem, our EAS capacity happens to be were the effects of the

unintended consequences will be first seen. The cry for help from the Airline Industry regarding the pilot

shortage is not being heard.
1. Industry wide Pilot shortage exists today an~ crisis will dramatically be become more evident soon

a. 1500 hour/ATP (Airline Transport Pilot Rating) rule will significantly lamage Small Community Air

Service Nationwide

I. Will there be exemptions?

il. If so, what will they be?

1. Knowing the exemptions allows Great Lakes to begin planning a strategy

b. Number of student pilots registered with FAA has dramatically decreased over the years and the 1500

rule will further exacerbate Airline Industry Pilot supply crisis.

I. Typical student graduates 4 year college with 350-400 hours - now they will have to more than

double that amount prior to being hired by a Part 121 carrier

1. Cost-prohibitive for student

2. Credit /student loans not available for students to pay for increased number of hours

required

c. Great Lakes typically retains approximately 280 pilots on staff - losing significant percentage due to:

I. Higher than normal attrition rates in last 30 days - unpredictable going forward

ii. Approximately 20 pilots with total hours of 1400+ (but less than 1500 hrs) on August 1, 2013 will

be lost due to new 1500 hour rule and lack of exemption relief

2. Part 135 operations - 9 seats or less

a. Great Lakes had requested a Part 135 certification in addition to their 121 cert - exhibits - April 8, 2013

Letter to FAA and June 18th response from FAA

i. Part 135 allows Great Lakes to employ pilots (First Officers) with less than 1500 hours

1. Would operate in Minneapolis hub while first officers increase their time to 1500 hours

in order to move into Part 121 operation

b. Great Lakes needs the ability to block seats as opposed to removing seats

I. Great Lakes was denied their request to block seats by Denver FAA

ii. Removing seats impedes our ability to rotate aircraft between our MSP and DEN operations

3. Great Lakes will not have enough pilots to staff Minneapolis operation

a. Reduction in flight schedules in the Minneapolis hub will be required soon

i. Change of flighttimes

ii. Discontinue flights that are above & beyond EA5 contract

iiI. Issue of survival for EAScommunities who already struggle to maintain their presence in the

National Transportation System

In Summary: No pilots = No service

These two issues need immediate attention of Congressional members.

• Need immediate administrative response by FAA as to what the exemptions to the 1500hr /ATP rule will be?

• Need the FAA to allow seat blocking (down to nine seats) versus removing 10 seats from the plane thus not

allowing for a seamless pooling / swapping of aircraft for maintenance and reliability
Approved and Accepted Programs and Manuals:

• Flight Operations Manual -GLA would propose to issue a second FOM or a Part 135 FOM

• Inflight Services Manual-Not applicable as only Beecb 1900's would be utilized

• Station Operations Manual-Potential updates for differences in operations and seating capacity

• Dispatcb Procedures Manual-Appropriate cbanges as tbey would pertain to flight following and services

provided to the 135 operations

• CrewmemberlDispatcher Training Manual-Training appropriate to 135 regulations and any differences in

tbe operation. Systems would remain uncbanged and flight training would remain by in large unchanged

with different regulatory references. Separate section for 135 training but this would primarily be

regulatory references on the training forms. Maneuvers and requirements are essentially the same.

• General Maintenance Manual-No appreciable changes planned. Aircraft would be maintained under one

CAMP

• Aircraft Fueling Manual-regulatory references added, but no appreciable cbanges

• Emergency Response Manual -No changes required

• Aircraft Inspection Manual-potential regulatory references but no appreciable changes, See GMM

• Safety Program -No appreciable changes

• Internal Evaluation Program -No appreciable cbanges

• 1900 Flight Standards Manual-No appreciable changes operations should be conducted utilizing the same

SOP for both types of operations

• E 120 Flight Standards Manual -Not applicable, EI20 operations would be conducted in accordance witb

Part 121

• Manager's Manual for Operations -Applicable 135 references and minor changes with the operating

certificate.

• Dangerous Goods/Hazardous Materials Manual- No appreciable cbanges

• EI20 MEL-No changes

• Ground Deicing Manual-no appreciable changes, regulatory references to include 135

• Aircraft Weight and Balance -no appreciable cbanges, regulatory references to include 135

• No Carry-on Baggage Program Manual-no appreciable cbanges, regulatory references to ioclude 135

• 1900 MEL -Changes as applicable for 135 operations per MMEL

• Exit Row Seating Program Manual -no appreciable cbanges, regulatory references to include 135

• Maintenance Control Procedures Manual-no appreciable changes, regulatory references

• Crew Scheduling Manual-No appreciable changes, duty and rest requirements are currently bandIed under

Part 135 per Ops Spec A033, 121.470(b), 121.480(a), and 121.500(a).

• Documents Department Mauual-No appreciable changes, regulatory references and checkride references,

however little cbange to the Training is anticipated

• Aircraft Records Department Manual-Unchanged in practice. Aircraft will be maintained under one

program.

• Aviation Safety Action Program Manual-no appreciable changes anticipated.

• Cargo Services Manual-no appreciable changes anticipated.

• EWINS Manual-No appreciable changes required.

• 1900 APG Manual-takeoff and landing data/performance should be able to utilize the Part 12I standards

which are very similar to the 135 standards. -regulatory references may have to be modified.

• E120 APG Manual -Not Applicable.