Before the United States Department of Transportation

Washington, DC

February 21, 2014

FORT DODGE, IOWA

MASON CITY, IOWA

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Essential Air Service at:

Docket OST -2001-10682

Docket OST -2001-10684

under49 U.S.C. 41731 et.seq.

This document contains the response of Great Lakes Aviation, Ltd. to Order Requesting

Proposals 2014-1-20.

The proposed service is being offered with local service marketed and priced utilizing the Great

Lakes (ZK) reservations system which includes customer ticket purchasing capability on both

the Great Lakes' web site and on numerous web booking engines. Additionally, Great Lakes

and Delta Airlines have formed a partnership to enable the sale of Great Lakes' passenger

segments on the Delta website as well as, providing the passenger with through check-in and

seamless baggage transfers.

The proposal offers service to our Minneapolis/St. Paul hub or as an alternative, Chicago

O'Hare, utilizing Beech 19000 or EMB-120 aircraft for the same subsidy amounts. The alternate

Chicago O'Hare service would require support from each respective community to effect a hub

change and is subject to the availability of gate facilities.

In addition, Great Lakes maintains interline ticketing and baggage agreements with the majority

of the other carriers serving Minneapolis/St. Paul or Chicago O'Hare, including interline eticketing agreements with American Airlines, Delta Airlines, Frontier Airlines and United Airlines.

All of which will offer the passenger maximum access to the domestic and international air

transportation system.

Great Lakes was recently forced to suspend service at Fort Dodge and Mason City due to the

severe industry-wide pilot shortage and its relative acute impact on Great Lakes. The proposed

service to these communities assumes that we will receive the necessary final FAA approvals

that allow our pilots to operate the Beech 19000 aircraft in a nine seat configuration. We are in

the process of recruiting and training pilots in an effort to replenish our staff of qualified pilots. It

would be expected that the re-installation of the additional 10 seats, allowing for utilization of all

19 seats, would occur as soon as pilot experience allows for the issuance of restricted ATP

certificates.
The recently implemented regulatory requirements have dramatically accelerated a long

anticipated pilot shortage, causing nationwide damage to small community air service. The

unintended consequences of the Congressionally mandated regulatory changes will require

commitments to be made to address the long-term impact on the airline industry as a whole.

Great Lakes' stands ready to participate in creative solutions to assist small communities in their

efforts to remain in the National Air Transportation System.

Questions and comments may be referred to:

Michael Matthews

Chief Financial Officer

Great Lakes Airlines

1022 Airport Parkway

Cheyenne, VVY 82001

(307) 432-7000
Table of Contents:

Proposal Subsidy Passengers Average

Number Service Point(s) Hub(s) Served Round Trips Equipment Requirement Forecast Fare Departures Dept Rate

Fort Dodge, Iowa MSP orORD 3 1900-D $2,577,749 11,000 $97.17 1,840 $1,400.95

MSP orORD 2 EMB-120 1,227 $2,100.85

2 Mason City, Iowa MSPorORD 4 1900-D $2,676,869 12,500 $90.27 2,454 $1,090.82

MSP orORD 2 EMB-120 1,227 $2,181.64
Great Lakes Aviation, Ltd.

Annual Compensation Requirements for Essential Air Service at

Fort Dodge, Iowa to Minneapolis/St. Paul ( MSP ) or Chicago O'Hare ( ORO)

Three Roundtrips w/B1900D or Two Roundtrips wi EMB-120

98.0% completion factor

Departures to be performed by Beech 1900 schedules:

Departures to be performed by EMB-120 30 seat aircraft if option is preferred by community:

Operating Revenues:

Passenger: FOD 11,000 psgrs at $97.17 $1,068,870

Other: (at 0.62% of passenger revenue)

Total Operating Revenues:

Operating Expenses:

Direct: Aircraft and Hull Insurance

Fuel and Oil

Flying Operations

Maintenance

Total Direct Expenses:

Total Indirect Expenses:

Total Operating Expenses:

Operating Loss

Profit Element (5.0% of Total Operating Expenses)

Annual Compensation Requirement:

No Upline Scheduling Restrictions

$6,627

$365,710

$957,394

$438,662

$711,245

1,840

1,227

$1,075,497

$2,473,011

$1,006,271

$3,479,281

($2,403,784 )

$173,964

$2,577,749
Great Lakes Aviation, Ltd.

Annual Compensation Requirements for Essential Air Service at

Mason City, Iowa to Minneapolis/St. Paul ( MSP ) or Chicago O'Hare ( ORD )

Four Roundtrips w/B1900D or Two Roundtrips w/EMB-120

98.0% completion factor

Departures to be performed by Beech 1900 schedules: 2,454

Departures to be performed by EMB-120 30 seat aircraft if option is preferred by community: 1,227

Operating Revenues:

Passenger: MCW 12,500 psgrs at $90.27 $1,128,375

Other: (at 0.62% of passenger revenue) $6,996

Total Operating Revenues: $1,135,371

Operating Expenses:

Direct: Aircraft and Hull Insurance

Fuel and Oil

Flying Operations

Maintenance

$365,710

$1,029,799

$362,922

$754,022

Total Direct Expenses: $2,512,452

Total Indirect Expenses: $1,118,253

Total Operating Expenses: $3,630,705

Operating Loss

Profit Element (5.0% of Total Operating Expenses)

($2,495,334 )

$181,535

Annual Compensation Requirement: $2,676,869

No Upline Scheduling Restrictions
*** [FOD] FORT DODGE, IA ***

Sample Schedule

-------------------- D E fl ART LJR E: S -------------------- -------------------- A R R I " A 1.S --------------------

FLT DPT ARR TO EQP FREQ FLT EQfl FREQ FROM DflT ARR

7272 615 730 MSP BE1 123456

7273 BE1 12345 MSP 930 1040

7273 1050 1205 MSP BE1 123457

7277 BE1 Daily MSP 1130 1240

7277 1300 1415 MSP BE1 123457

7278 BE 1 12345 7 MSP 1840 1950
*** [MCW] MASON CITY, IA ***

Sample Schedule

-------------------- [)E:~ A Ft T lJ Ft E:S -------------------- -------------------- A Ft Ft I V A L S --------------------

FLT OPT AFtFt TO E:Q~ FFtE:Q FLT E:Q~ FFtE:Q FFtOM [)~T AFtFt

7282 533 618 MSP BE1 12345

7283 BE1 12345 MSP 855 940

7283 950 1035 MSP BE1 Daily

7285 BE1 Daily MSP 1445 1530

7285 1549 1625 MSP BE1 Daily

7286 BE1 Daily MSP 1745 1830

7286 1845 1930 MSP BE1 12345

7289 BE1 12345 MSP 2155 2240