Order: 20 1 1
- 3
- 2 Served : March 1, 2011 

### UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C. Issued b y the Department of Transportation on the 1 st of March , 201 1 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 s electing Colgan Air, Inc. ( Colgan ) to provide essential air service (EAS) at Staunton, Virginia , for an annual subsidy of $2,180,461 , for the two - ye ar 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
- 1 2
- 9 on December 6, 2010 , solicit ing proposals to provide EAS , with or without subsidy , at Staunton , for a new two - ye ar period
. Proposal of Colgan Colgan, the incumbent, was the onl y carrier to submit a proposal. Under its proposal, Colgan proposes to continue its three
- round
- trip
- a - day service pattern from Staunton to Dulles f or an annual subsidy

of $2,180,461. Service would be operated with 34
- se at 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 c omplete proposal may be acces sed online at http://www.regulations.gov/ by entering “DOT
- OST
- 2002
- 11378” in the “Enter Key word or ID” field. Community Comments On January

20, 2011 , we requested community comments regarding the carrier selection at Staunton
. Ina January

25 letter fro m 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 wi th “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
- ye ar period, from May 1, 20 11 , through April 30 , 201 3 , to provide the community with 1 8 nonstop round trips a week to Washington Dulles with Saab 340 aircraft
. We shall make th i s selection at Staunton contingent upon the Department’s receiving properl y 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 lobb yi ng 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 sub j ect to the Department’s continuing fitness requirements, and no informati on 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 carrier s 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 supp ort claims for payment, and to preserve and maintain such documentation in a manner that readil y permits its audit and examination by representatives of the Department. Such documentation shall be retained for seven ye ars 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 continue s 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 th is document is available at http://www.regulations.govAppendix A


## AREA MAP

This map is provided by Sabre ® AirVision TM Profit Essentials and is being used with express permission of the copyright holder, Sabre Airline Solutions®.Appendix B Colgan Air, Inc. Proposal to serve StauntonAppendix C Colgan Air, Inc. Essential Air Service to be Provided at Staunton, Virginia Effective Period : May

1, 2011, through April 30, 2013 Scheduled Service : 1 8 weekl y round trips t o Washington Dulles International Airport Intermediate stops and upline service : S ervice 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, 201 1 Weekly Ceilin g : $ 4 3,236 2 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 comp leted 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 o r 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 peri od 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 carrie r 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 adju sted 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 complet e ly , 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 w riting 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 w riting to the carrier. All claims fo r 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.