AFS-11-040-E May 31, 2012

Exemption No. 10550 Regulatory Docket No. FAA-2003-14309

Mr. Tim Brooks Vice President, Flight Operations

Kenmore Air Harbor, Inc.

6321 NE. 175 th Street

Kenmore, WA 98028

Dear Mr. Brooks:

This letter is to inform you that we have denied your petition to extend Exemption No. 2528, as amended. It explains the basis for our decision and describes its effect.

The Basis for Our Decision

By letter dated October 28, 2010, you petitioned the Federal Aviation Adm inistration (FAA) on behalf of Kenmore Air Harbor, Inc. (Kenmore Air Harbor), for an extension of Exemption No. 2528, as amended. That exemption from § 135.203(a)(1) of Title 14, Code of Federal Regulations (14 CFR) allowed Kenmore Air Harbor to operate under visual flight rules (VFR) outside controlled airspace over water at an altitude below 500 feet.

Your original grant of exemption from the 500 foot altitude restriction in 14 CFR § 135.203(a) stems from an exemption that was gr anted to the Alaska Air Carrier Association, Inc, (AACA) in March 1979. AACA petitioned on behalf of 10 air taxi operators who operated exclusively within a 150-mile radius of Ketchikan, Alaska, to fly below 500 feet within a certain corridor that was prone to congested traffic following completion of the newly constructed airport in Ketchikan on Ma y 24, 1973. The FAA created this corridor to permit simultaneous IFR and seaplane VFR operations. Because the ceiling of the corridor was limited to 400 feet, seaplane operators wishing to use this corridor for VFR operations had to seek an exemption from the altitude restrictions in 14 CFR §135.203(a).2

As an additional basis for this original exemption request, AACA asserted that a weather phenomenon unique to the Alaskan coastal areas was also making it difficult to conduct commercial operations in the region. Given the fr equency of snow, rain, drizzle, fog, and low ceilings due to the coastal weather, many of these operators could not conduct operations into remote villages, logging camps, and fishing and hunting areas. Further complicating these operations were the lack of navigational aids, instrument flight rules (IFR route) and instrument approaches into these areas. Further, given that waterways are acceptable landing fields for seaplanes, AACA asserted that seaplanes could be operated safely below the 500 foot limitation in 14 CFR §135.203 over the sheltered inland waterways of Southeast Alaska within the established corridor, without an adverse impact on safety.

The FAA, in consideration of the public interest to provide service to these remote areas, granted the exemption but limited it to operations conducted in an area that encompassed the Tongass Narrows between Ward Cove and Ketchikan Harbor, along and within 500 feet of the Revillagigedo Island shoreline. The 10 operators authorized to use this exemption were also required to have a letter of agreement on file with the FAA Flight Standards District Office in Ketchikan, Alaska, which permitted them to use this corridor.

Since its original, limited grant in 1979, similar exemptions have been granted to approximately 38 other operators. These exemptions appear to have expanded the limitations of this exemption beyond the FAA’s original intent, which was to address a safety issue unique to a specific corridor following completion of the Ketchikan airport in 1973.

In late 2009 the FAA began to assess these exemptions given the current operating environment, advances in technology and availability of weather sources since 1979, as well as new operating rules for air tour operators that were introduced in 2007. In the course of this evaluation, we have identified new facts and safety concerns that warrant no longer extending these exemptions as originally granted.

First, the exemption appears to create circumstances that could result in controlled flight into terrain (CFIT). Since the original issuance of this exemption, the FAA has published guidance addressing the inherent risk of CFIT w ith suggested mitigation strategies. We have found that CFIT accidents are often the result of a pilot trying to fly or maneuver beneath a lowering ceiling and hit an obstacle or terrain or impact water. One situation permitted by the exemption, flight below 500 feet above the surface with only minimum visibility requirements, may tempt pilots to operate under ceilings considered IMC when reported in weather reports and forecasts. VFR pilots in reduced visual conditions may develop spatial orientation and lose control. Additionally, the risk of CFIT is compounded by overwater flight.

Second, we now have new information about the unique weather phenomena the petitioners’ have asserted as one of the reasons for this exemption. The petitioners have stated that VFR conditions under low cloud layers frequently occur in Southeast Alaska. However, the National Weather Service has provided information to the FAA that it is also common for3

IFR ceilings and visibilities to exist together, meaning as the ceiling gets lower, so does visibility. These conditions are the most likely to result in flat-light and glassy water conditions. Flat light can obscure terrain features, creating an inability to distinguish distance and closure rates. Additionally, the National Weather Service has informed the FAA that the variability of weather conditions across the inner channels of Southeast Alaska can be drastic and the amount of variability between two points is not easily predicted.

Third, we are aware of at least 12 accidents since 1988 that occurred under conditions similar to those allowed by the exemption, including marginal VFR A review of these accidents indicates pilots were likely unaware of an impending collision with water or other terrain. Contributing factors appear to be inadequate training, lack of planning, insufficient operational control and failures in management communication.

Our Decision

The FAA has determ ined that the justification for the issuance of Exemption No. 2528, as amended, is no longer valid as it does not provide an equivalent level of safety to that provided by § 135.203(a) and is not in the public interest. Therefore, under the authority provided by 49 U.S.C. 40113 and 44701, which the FAA Administrator has delegated to me, your petition to extend Exemption No. 2528, as amended, is denied.

Any new request for exemption from the altit ude restrictions in 14 CFR § 135.203(a), must be submitted in accordance with 14 CFR § 11.81 and will be considered on a case-by-case basis and evaluated carefully as to whether it would have an adverse impact on safety and whether it would serve the public interest.

Sincerely,

/s/

John S. Duncan Deputy Director, Flight Standards

Service