Order: 2011-3-2

 Served: March 1, 2011

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 1

st of March, 2011

Essential Air Service at

STAUNTON, VIRGINIA

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

 Docket DOT-OST-2002-11378

ORDER SELECTING CARRIER

Summary

By this order, the Department is selecting Colgan Air, Inc. (Colgan) to provide essential air 

service (EAS) at Staunton, Virginia, for an annual subsidy of $2,180,461, for the two-year period 

from May 1, 2011, through April 30, 2013.

1

Background

By Order 2008-12-29, December 30, 2008, the Department selected Colgan to provide EAS with 

subsidy support at Staunton, for two years, from May 1, 2009, through April 30, 2011, at an 

annual subsidy rate of $1,911,466. Under that order, Colgan provides the community with 18 

nonstop round trips each week to Washington Dulles International Airport (Dulles) using 34-

passenger Saab 340 aircraft. While all Staunton-Dulles service is nonstop, some flights also 

serve an upline community, Beckley, West Virginia.

In anticipation of the end of the rate term, the Department issued Order 2010-12-9 on

December 6, 2010, soliciting proposals to provide EAS, with or without subsidy, at Staunton, for

a new two-year period. 

Proposal of Colgan 

Colgan, the incumbent, was the only carrier to submit a proposal. Under its proposal, Colgan 

proposes to continue its three-round-trip-a-day service pattern from Staunton to Dulles for an 

annual subsidy of $2,180,461. Service would be operated with 34-seat Saab 340 aircraft as 

 

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

United Express under agreement with United Airlines. Although 18 weekly nonstop round trips 

are proposed, some of those operations also serve Beckley, West Virginia, using the same 

aircraft. Colgan’s complete proposal may be accessed online at http://www.regulations.gov/ by

entering “DOT-OST-2002-11378” in the “Enter Keyword or ID” field.

Community Comments

On January 20, 2011, we requested community comments regarding the carrier selection at 

Staunton. In a January 25 letter from Gerald W. Garber, Chairman of the Shenandoah Valley

Regional Airport Commission, he states that Colgan has served the community since 2003 and,

starting in 2008, implemented significant upgrades to the service, including a new code-share 

relationship with United Airlines, service to United’s Washington Dulles hub, and upgraded the 

aircraft serving the community from 19-seat Beech 1900 aircraft to 34-seat Saab 340 aircraft. As 

a result, passenger traffic has increased 126 percent. He states that the [Staunton] market has 

demonstrated in the past that it can support unsubsidized service when served with well-timed 

access to a viable hub airport with “the appropriate code-sharing agreement and equipment.” 

Decision

Colgan has served Staunton via Shenandoah Valley Regional Airport since 2003 and continues 

to provide them with reliable essential air service. We find that both the service and subsidy 

levels are reasonable, and Staunton officials affirmatively support Colgan’s service. Therefore, 

we will reselect Colgan for an additional two-year period, from May 1, 2011, through April 30, 

2013, to provide the community with 18 nonstop round trips a week to Washington Dulles with 

Saab 340 aircraft. 

We shall make this selection at Staunton contingent upon the Department’s receiving properly 

executed certifications from Colgan that the carrier is in compliance with the Department’s 

regulations regarding drug-free workplaces and nondiscrimination, as well as the regulations 

concerning lobbying activities.

Carrier Fitness

49 U.S.C. 41737(b) requires that we find an air carrier fit, willing, and able to provide reliable 

service before we may subsidize it to provide essential air service. Colgan is subject to the 

Department’s continuing fitness requirements, and no information has come to our attention that 

would cause us to question the 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 

finding. We therefore conclude that the carriers remain fit to conduct the operations proposed 

here.

This order is issued under authority delegated in 49 CFR 1.56a(f).

ACCORDINGLY,

1. We select Colgan Air, Inc. to provide essential air service at Staunton, Virginia;

2. We set the final rate of compensation for Colgan for the provision of essential air service at 

Staunton, Virginia, as described in Appendix C, page 1;
- 3 -

3. We direct Colgan 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 permits its audit and examination by representatives of the Department. Such 

documentation shall be retained for seven years or until the Department indicates that the records 

may be destroyed, whichever comes first. Copies of flight logs for aircraft sold or disposed of 

must be retained. The carrier may forfeit its compensation for any claim that is not supported 

under the terms of this order;

4. We find that Colgan continues to be fit, willing and able to operate as a certificated carrier 

and capable of providing reliable essential air service at Staunton, Virginia; and

5. We will serve copies of this order on the mayor of Staunton, the Executive Director of

Shenandoah Valley Regional Airport, and Colgan Air, Inc.

By:

SUSAN L. KURLAND

Assistant Secretary

for Aviation and International Affairs

(SEAL)

An electronic version of this document is available at http://www.regulations.gov
Appendix A

 

AREA MAP

This map is provided by Sabre® AirVisionTM Profit Essentials and is being used with express permission of the copyright holder, 

Sabre Airline Solutions®.
Appendix B

Colgan Air, Inc.

Proposal to serve Staunton
Appendix C

 

Colgan Air, Inc.

Essential Air Service to be Provided at Staunton, Virginia

Effective Period: May 1, 2011, through April 30, 2013

Scheduled Service: 18 weekly round trips to Washington Dulles International Airport

Intermediate stops and upline service: Service must be nonstop to/from Dulles, but upline service 

to Beckley, West Virginia, is permitted

Aircraft: Saab 340 (34 seats)

Rate per Eligible Flight: $1,2011

Weekly Ceiling: $43,2362

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in 

conformance with 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 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 period, it may jeopardize its entire subsidy claim for the 

period in question. If the carrier contemplates any such changes beyond the scope of the order during the applicable 

period of these rates, 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. In determining whether 

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 make payments in the stipulated amounts or at the stipulated service levels, the carrier may cease 

to provide service to that specific location without regard 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 reduction or cessation of payment.

Subsidy contracts are subject to, and incorporate by reference, relevant statutes and Department regulations, as they 

may be amended from time to time. However, any such statutes, regulations, or amendments thereto shall not 

operate to controvert the foregoing paragraph.

Funds are not currently available for performance under this order beyond March 3, 2011. The Government’s 

obligation for performance under this order beyond March 3, 2011, is subject to the availability of appropriated 

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 beyond March 3, 2011, until funds are made available to the 

Department for performance. If funds are not made available for performance beyond March 3, 2011, the 

Department will provide notice in writing to the carrier.

All claims for payment must be submitted within 60 days of the last day of service provided under this order.

 

1 Annual compensation of $2,180,461, divided by 1,816 annual departures (36 flights per week x 52 weeks x 97 

percent completion.

2 36 flights per week multiplied by $1,201 per flight.