Order: 2014

- 8

- 22
Served: August 28, 2014



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 28 th day of August 20 1 4

Essential Air Service at

LARAMIE, WYOMING WORLAND, WYOMING DOCKET DOT

- OST

- 1997

- 2958

DOCKET DOT

- OST

- 1997

- 2981

under 49 U.S.C. 41731 et seq.



### ORDER RE

- SELECTING AIR CARRIER S

Summary By this Order the Department is re

- selecting SkyWest Airlines, operating as United Express (SkyWest), to provide E ssential Air Service (E AS ) at Laramie , Wyoming, for a

two

- year term from October 1, 2014, through Septembe r 30, 201 6

, at an annual subsidy of $1,722,081. SkyWest will provide Laramie with 14 nonstop round trips per week to Denver International Airport (DEN) using 30

- passenger Embraer 120 Brasilia (EMB120 )

aircraft. In the event that SkyWest is not able to pr ovide service on EMB120 aircraft due to reduced availability of that aircraft type, it will provide 12 nonstop round trips per week for an annual subsidy of $2,078,554, using 50

- passenger Canadair Regional Jet (CRJ200)

aircraft.

Under this same Order, the Department is re

- selecting Great Lakes A viation, Ltd. ( Great

Lakes ) , at Worland, Wyoming, for a two

- year term from October 1, 2014, through September 30, 201 6 , at an annual subsidy of $2,327,987. 1

1 Such subsidy is calculated and distributed on a fiscal year basis, subject to the availability of funds.- 2

-

Background By Order 2012

- 8

- 8 (August 3, 2012), the Department selected SkyWest to provide EAS at

Laramie

, for a two

- year term ending September 30, 2014

, at an ann ual subsidy rate of $1,635,346. By the same Order, the Department re

- selected Great Lakes to provide EAS at

Worland for a two

- year term ending S eptember 30, 2014, at an annual subsidy of $1,987,148.

As the end of the contract s were approaching, we issued Order 2014

- 4

- 5 (April 3, 2014) requesting proposals from air carriers interested in providing EAS at the communities for a new contract term. In response to that Order, we received proposals from Boutique Air, Great Lakes, and SkyW est.

Each air carrier’s complete proposal and community comments may be accessed online at www.regulations.gov by entering each community’s respective Docket number in the

search block.

Proposal of Boutique Air Boutique Air submitted a proposal to serve both Laramie and Worland using 9

- passenger Pilatus PC

- 12 aircraft for a combined annual subsidy of $4,177,754 ($2,088,877 for each community) . At Laramie, the airline proposes to provide 18 nonstop round trips pe r week to DEN, and at Worland the airline proposes to provide 18 one

- stop round trips per week to

DEN.

Proposal of Great Lakes

Great Lakes submitted a bid to serve Worland only, proposing to provide 12 one

- stop round trips per week to DEN using either 9

- p assenger or 19

- passenger Beech c raft 1900D aircraft for an annual subsidy of $2,327,987.

Proposal of SkyWest SkyWest proposes to continue service from Laramie to DEN with 14 weekly nonstop round trips per week for an annual subsidy of $1,722,081 using 30

- p assenger EMB120

aircraft. I n the event that SkyWest is not able to provide service on EMB120 aircraft due to reduced availability of that aircraft type, it will provide 12 nonstop round trips per week for an annual subsidy of $2,078,554

, using 50

- passenge r Canadair Regional Jet (CRJ200)

aircraft

.

Community Comments On May 27, 2014, we requested comments from both communit i es regarding this EAS air carrier selection case. In response, we received a letter from the Dr. George Krell, Board

Chairman for Laramie Regional Airport Board (LRAB) strongly supporting SkyWest’s proposal. In his letter, Dr. Krell states “The LRAB and the Laramie community have been extremely satisfied with SkyWest Airlines over the last two years. ” Dr. Krell went on to

state “Th e increased passenger loads we’ ve experienced over the last two years prove that an air carrier that is reliable, customer service oriented, and that provides a competitive air fare can be successful in a community like Laramie and does make a difference.” We also- 3

-

received a letter from Mr. Jack Skinner, Airport Manager at Laramie Regional Airport, that indicated the community’ s support for SkyWest’s proposed regional jet service with reduced frequency.

We also received comments from the Honorable Dave D uffy, Mayor of Worland,

support ing the proposal of Great Lakes for a new contract term.

Decision After carefully reviewing each air carrier’s proposal, we have decided to re

- select SkyWest

at Laramie and Great Lakes at Worland. Each of these airlines has the support of the community that it is proposing to serve. We find the subsidy and service levels reasonabl e and that the service will meet the EAS needs of both communities

.

With respect to SkyWest’s proposal at Laramie, we are selecting its status

- quo service for an annual subsidy of $1,722,081. However, should SkyWest transition the EMB120 aircraft out of the Laramie market during the course of the new contract term, we wil l allow SkyWest to operate the CRJ200 aircraft with 12 nonstop round trips per week to DEN for an annual subsidy $2,087,554. The community supports the upgrade in aircraft with the reduced frequency.

We shall make these selections upon the Department’s receiving properly executed certifications from the air carriers that they are in compliance with the Department’s regulations regarding drug

- free workplaces and nondiscrimination, as well as the regulations concerning lobbying activities. 2

Carrier Fitnes s 49 U.S.C. §§ 41737(b) and 41738 require that we find an air carrier fit, willing, and able to provide reliable service before we may subsidize it to provide EAS

. SkyWest and Great

Lakes are subject to the Department’s continuing fitness requirements, an d no information

has come to our attention that would cause us to question either air carrier’s fitness at this
time. We have contacted the Federal Aviation Administration, and it has raised no concerns that would negatively affect our fitness findin gs. We therefore conclude that SkyWest and Great Lakes are reliable and fit to conduct the operations proposed here.

This Order is issued under authority delegated in 49 CFR Part 1

. 25a(b)

.

ACCORDINGLY,

1. We re

- select SkyWest Airlines to provide Essential Air S ervice at Laramie, Wyoming

, and establish the annual subsidy rate s as described in Appendix C ;

2. We re

- select Great Lakes Aviation, Ltd. to provide Essential Air Service at Worland, Wyoming, and establish the annual subsidy rate as described in Appendix C;

2 The certifications are available online under “Reports and Publications” at http://www.dot.gov/policy/aviation

- policy/small

- community

- rural

- air

- service/essential

- air

- service- 4

-

3. We direct SkyWest Airlines and Great Lakes Aviation, Ltd. to retain all books, records, and other source and summary documentation to support claims for payment, and to preserve and maintain such documentation in a manner that readily perm its its audit and examination by representatives of the Department. Such documentation shall be retained for seven years from the service date of this Order or until the Department indicates that the records may be destroyed, whichever comes first. Copie s of flight logs for aircraft sold or disposed of must be retained. The carrier s may forfeit their compensation for any claim that is not supported under the terms of this Order ;

4 . We f i nd that SkyWest Airlines and Great Lakes Aviation, Ltd., are fit, willing and able

to operate as c ertificated and commuter air carrie r s
, respectively, and capable of providing

reliable Essential Air S ervice at Laramie and Worland, Wyoming ;

5

. Th ese docket s will remain open pending further Department action ; and

6

. The Department will serve a copy of this O rder on the mayors of Laramie and Worland ; the airport managers of Laramie Regional Airport and Worland Municipal Airport ; the Wyomi ng Department of Transportation; Boutique Air , Inc. , Great Lakes Aviation, Ltd., and SkyWest Airlines.

B y:

SUSAN L. KURLAND Assistant Secretary for

Aviation and International Affairs

(SEAL)

An electronic version of this document is ava ilable at www.regulations.govA ppendix A



## AREA MAP

Maps generated by the Great Circle Mapper

- copyright © Karl L. Swartz

.Appendix B Page 1 of 2Appendix B Page 2 of 2Appendix C Page 1 of 2

SkyWest Airlines

Essential Air Service to be Provided at La ramie, Wyoming

DOT

- OST

- 1997

- 2958

Annual Subsidy: 1 $1,722,081 (30

- passenger EMB120 aircraft) or $2,078,554 (50

- passenger CRJ200 aircraft)

Effective Period : October 1

, 2014

, through September 30

, 2016

Hub : Denver International Airport (DEN)

Scheduled Service : 14 nonstop round trips per week (EMB120 aircraft) or 12 nonstop round trips per week (CRJ200 aircraft)

Aircraft : 30

- passenger EMB120 or 50

- passenger CRJ200 Rate per Eligible Flight: 2 $ 1,207 (EMB120 aircraft) or $ 1,700 (CRJ200 aircraft Weekly Ceiling : 3 $33,796 (EMB120 aircraft) or $ 40,800 (CRJ200 aircraft)

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance wi th 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 explanatio n supporting subsidy eligibility for a flight 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 conf

ormance with the Order for a significant period, it may jeopardize its entire subsidy claim for the period in question. If t he carrier contemplates any such changes beyond the scope of the Order during the applicable period of this rate, it must first not ify the Office of Aviation Analysis in writing 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. I n determining whether subsidy payment for a deviating flight should be adjusted or disallowed, the Department w ill consider the extent to which the goals 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 requirements at a specific location provided for under this Order, then, at the end of the period for which the department do es make payments in the stipulated service levels, the carrier may cease to provide service to that specific location without regards 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 reductio n or cessation of payment.

Subsidy contract are subject to, and incorporate by reference, relevant statutes and Department regulations, as they may be a mended from time to time. However, any such statutes, regulations, or amendments thereto shall not ope rate to controvert the foregoing paragraph.

Funds may not be available for pe rformance under this O rder beyond September 30, 2014

. The Government’s obligat ion for performance

under this O rder beyond September 30, 2014

, is subject to the availability of f unds from which payment for services can be made. No legal liability on the part of the Government for any payment may arise for performance u nder this order beyond September 30, 2014 , until funds are made available to the Department for performance. If sufficient funds are not made available for performance beyond September 30,

2014 , the Department will provide notice in writing to the carrier.

All claims for payment, including any amended claims, must be submitted within 90 days of the last day of the month for which compensation is being claimed. For example, claims for service provided in July must be filed by October 31; August claims must be submitted by November 30, and so on.

1 SkyWest may transition from the EMB120 aircraft to CRJ200 aircraft at some point during the contract term. However, only one type of aircraft may be used at one time . W e are not allowing SkyWest to operate two types of aircraft simultaneously.

2 EMB120 aircraft: annual compensation of $1,722,081 divided by 1,427 annual departures (28 weekly departures x 52 weeks x 98 percent completion); CRJ200 aircraft: annual compensation of $2,078,554 divided by 1,223 annual departures (24 weekly departures x52 weeks x 98 percent completion).

3 EMB120 aircraft: 28 arrivals and departures per week multiplied by $1,207 per flight. CRJ200 aircraft: 24 arrivals and departures per week multiplied by $1,700 per flight.Appendix C Page 2 of 2

Great Lakes Aviation, Ltd.

Essential Air Service to be Provided at Worland, Wyoming

DOT

- OST

- 1997

- 2981

Annual Subsidy: $2,327,987

Effective Period : October 1, 2014, through September 30

, 201 6

Hub : Denver International Airport (DEN)

Scheduled Service : 12 one

- stop round trips per week

Aircraft : Beechcraft 1900D Rate per Eligible Flight: $ 1,904 1
Weekly Ceiling : $ 45,696 2

Note: The carrier understands that it may forfeit its compensation for any flights that it does not o perate in conformance with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significan t elements of the required service, without prior approval. The carrier understands that an aircraft take

- of f and landing at its scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight 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 per iod, it may jeopardize its entire subsidy claim for the period in question. If the carrier contemplates any such cha nges beyond the scope of the Order during the applicable period of this rate, it must first notify the Office of Aviation Analysis in writing 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. I n determining wh ether subsidy payment for a deviating flight should be adjusted or disallowed, the Department will consider the extent to which the goals 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 requirements at a specific location provided for under this Order, then, at the end of the period for which the department does ma ke payments in the stipulated service levels, the carrier may cease to provide service to that specific location without regards to any requirement for notice of such cessation. Those adjustments in the levels of subsidy and/or service that are mutually a greed to in writing by the Department and carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract are subject to, and incorporate by reference, relevant statutes and Department regulations, as they may be

amended f

rom time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds may not be available for performance under this Order beyond September 30, 2014. The Government’s obligation for performance under this Order beyond September 30, 2014, is subject to the availability of 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 be yond September 30, 2014, until funds are made available to the Department for performance. If sufficient funds are not made available for performance beyond September 30, 2014, the Department will provide notice in writing to the carrier.

All claims for payment, including any amended claims, must be submitted within 90 days of the last day of the month for which compensation is being claimed. For example, claims for service provided in July must be filed by

October 31; August claims must be submitted by November 30, and so on.

1 Annual compensation of $ 2,327,987 divide d by 1,223 an nual departures (24 wee kly departures x 52 weeks x 98 percent completion)

. 2 24 arrivals and departures per week multiplied by $ 1,904 per flight

.