Ralph Cordova Jr. 

County Executive Officer 

May 13, 2014 

Kevin Schlemmer 

COUNTY EXECUTIVE OFFICE 

Chief, Essential Air Service & Domestic Analysis Division 

United States Department ofTransportation/W86-309 

1200 New Jersey Ave SE 

Washington, DC 20590 

RE: Response to USDOT Tentative Order# 2014-4-26 

Dear Mr. Schlemmer: 

County Administration Center 

940 Main Street, Suite 208 

El Centro, CA 92243 

760-482-4290 Tel 

760-352-7876 Fax 

www .co. imperial.ca. us 

ralphcordova@co.imperial.ca.us 

Imperial County Airport ("IPL") is one of 13 airports that were notified by Tentative Order by the United 

States Department of Transportation ("US DOT") on April 241h, 2014 that the community may lose 

Essential Air Service ("EAS") eligibility because IPL fell short of the criteria requirement to serve fewer 

than ten passengers per day during the year-ended September 30, 2013. Further, the Tentative Order 

indicates that the community needs to "show cause as to why the Department of Transportation should not 

terminate the eligibility of the community under the Essential Air Service (EAS) program." 

I urge you to grant a waiver so that IPL does not lose its EAS eligibility on the basis that it is a temporary 

circumstance that IPL's passenger performance has dropped below ten passengers per day. As this letter 

will demonstrate, the service area around IPL was hard-hit by the Global Credit Crisis and Mortgage 

Meltdown Crisis in 2008, but economic and demographic trends have improved since. In addition, the 

EAS airline and routes changed in May 2013, and in the short time since the new service has been in place, 

passenger acceptance has built steadily. 

Introduction 

IPL is located in Southeastern California bordered by Arizona to the East, San Diego County to the West, 

and Mexico to the South. Even though it is about 113 miles to San Diego, road access to the nearest large 

hub airport to Imperial County is made uniquely more challenging than distance alone due to congestion 

and the unpredictably of stationary border patrol traffic stops on all major roadways leading out of the 

County. As demonstrated below, SAN is the closest m~or airport to Imperial County, but it is almost a 

two hour drive. 

AN EQUAL OPPORTUNITY/AFFIRMATIVE ACTION EMPLOYER 
Figure 1: Distance to Major Airports from Imperial County 

San Diego 113 1 hour, 49 minutes 

Los Angeles 213 3 hours, 26 minutes 

Phoenix 243 3 hours, 53 minutes 

Tucson 296 4 hours, 16 minutes 

Las Vegas 384 6 hours, 2 minutes 

Paso 613 8 hours, 40 minutes 

San Francisco 591 9 hours, 21 minutes 

Sacramento 596 9 hours, 36 minutes 

Sources: California Dept of Finance; US Census Bureau; CA Employment Development Dept; Rand McNally.com 

This increases the amount oftime that passengers need to travel to other airports, as well as increases the 

community's reliance, thus importance, on IPL for access to the national and international air 

transportation network to support economic growth in the area. In addition, traveling to either San Diego 

International Airport ("SAN") or Burbank's Bob Hope Airport ("BUR") also means passengers are 

driving in two of the top 15 most congested regions in the US.1 

IPL's passenger performance peaked in 2007 with 64 enplanements per day on United Express. In 2008, 

the economy of Imperial County was devastated by the housing crisis and economic recession, which 

greatly hurt the county, the state of California, and the country. That said, from 2008 to 2012, passenger 

performance at IPL was approximately double the US DOT's threshold often passengers per day. 

Economic and Demographic Trends in Imperial County 

The economy of Imperial County was hard hit by the Global Credit Crisis and Mortgage Meltdown of 

2008, but prudent investments in the future have been made there, and positive results are being achieved. 

Imperial County was disproportionately impacted by the poor global economy because it is a market that 

relied upon the agricultural sector for jobs. This coupled with the loss of construction jobs in the county 

due to the housing crisis left the county as one of the worst performing economic areas in California. 

Offshoring of manufacturing jobs to Asia has also affected Imperial County's economy; however as 

wages increase in Asia, Mexicali, which is located on the US-Mexico border, is beginning to see these 

jobs return. 

Imperial County is now looking to grow with green-energy companies and eventually become the 

renewable energy capital of the country. Tenaska Solar Ventures is one of the companies investing in the 

area with an investment of more than $500 million dollars in the Imperial Valley's economy. This project 

will lead to 500 constructions job, 70 percent of which will be local. It will also lead to more than $20 

million in construction contracts to local companies. There are other companies that are also investing 

1 Greater Los Angeles is the 2nd most congestion car travel market and San Diego is ranked 15th (Texas A&M 

Transportation Institute, Annual Transportation Survey) 

2 
and partnering with the county such as Ocotillo Wind, CalEnergy, and 8minute Energy all of which are 

soiar energy firms. 

The effect of the recession on Imperial County is demonstrated in the county's gross regional product 

(GRP), which is shown on Figure 2. From 2009 through 2011, Imperial County's GRP declined one 

percent. Since 2012 it has been increasing and in 2013 was at a 10 year high of$4,928 million. 

Figure 2: Imperial County's Historical and Forecast Gross Regional Product 

iii 6,000.00 

.. 5,500.00 ..!!! 

0 

Q 5,000.00 

en 

Q 4,500.00 

2 4,000.00 Ill 

c: 3,500.00 ~ 

1 3,000.00 

c. 2,500.00 

1:1: 

(.!1 2,000.00 

Source: Woods & Poole 

Gross Regional Product 

(Millions) 

Imperial County's population increased between two and three percent until the housing crisis in 2008 as 

illustrated on Figure 3. Since then the population increased at a slower rate. Income per Capita has 

experienced similar trends, but it has experienced a more robust recovery in 2013, when the income per 

capita grew at a higher rate. 

3 
Figure 3: Imperial County's Historical Population and Total Personal Income Per Capita 

185 35 Ill 

180 

175 

~ 

30 a. 

a 

... 170 25 <LI 

a. 

c 

0 165 

':;:::; 

Ill 160 :; 

a. 

0 155 a. 

150 

<LI 

20 E 

o- uC 

c Q -c 

15 --Ill 

c 

10 ... 

~ 

<LI 

145 

140 

a. 

5 iS 

.... 

0 

1-

135 

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 

-Population ,Total Personal Income Per Capita (Current Dollars) 

Source: Woods & Poole 

Housing values in Imperial County demonstrate the impact the economic recession had on the county. In 

2007, median housing values peaked at almost $250,000, but decreased to a low of $130,000 in 2011. In 

2012 the housing values began to show signs of rebounding with an increase of2 percent per annum. 

Figure 4: Median Household Value 

300 i 

250 

g 

Q 200 ~ 

ar 

:= 150 

~ 100 

50 

0 

MEDIAN VALUE: 

Owner-occupied housing units 

2005 2006 2007 2008 2009 2010 2011 2012 

Source: American Community Survey, US Census 

4 
Historical Passenger Performance at IPL 

Of the thirteen airports impacted by the US DOT's Tentative Order, IPL has the highest number of 

passenger enplanements at 9.5 per day as shown on Figure 5. It bears noting that this is only half an 

enplanement per day lower than the US DOT's minimum requirement, and that it rounds to the US 

DOT's minimum level of ten. 

Figure 5: List of Airports Listed in Tentative Order Regarding Termination of EAS Eligibility 

EAS Air om Stnte En lanements!Du,· 

EL Centro California 9.5 

Fort Dodge Iowa 9.4 

Greenville Mississippi 9.3 

Jackson Tennessee 7.8 

Merced California 7.7 

Bradford Pennsylvania 6.9 

Lancaster Pennsylvania 6.3 

Muscle Shoals Alabama 6.3 

Athens Georgia 5.9 

Franklin/ Oil City Pennsylvania 5.0 

Macon Georgia 4.0 

Hagerstown Maryland 3.9 

Kin an Arizona 2.7 

Source: US DOT Tentative Order Regarding Termination of EAS Eligibility 

IPL has been served by two carriers, United Airlines regional Express affiliate operated by SkyWest 

Airlines ("UAX"), which ceased service in April of 2013, and Seaport Airlines ("Seaport"), which took 

over the flying in May of 2013 when the US DOT selected Seaport as the new EAS carrier. When UAX 

was serving IPL, flights were operated to Los Angeles International Airport ("LAX"), the third busiest 

airport in the US. The UAX service benefitted passengers because LAX has considerable connecting 

options with a diverse group of airlines serving a large number of domestic and international cities, to 

which IPL passengers could connect. United alone serves 48 domestic and 12 international destinations 

with 184 daily flights at LAX. Connecting service is key because the majority (78%) ofiPL's passengers 

traveled beyond LAX in 2012 on UAX's service? 

Seaport's service replaced flights to LAX with operations to SAN, the 29th busiest large-hub passenger 

airport in the US, and BUR, a medium-hub facility north of LAX. Despite the advantage ofhaving access 

to two airports, this federally mandated service attracted fewer passengers because it is flown on smaller 

aircraft (nine versus 30 seats). As a result of the smaller aircraft operated by Seaport, the number of daily 

seats offered from IPL is approximately half the level provided by UAX as shown on Figure 6. 

2 US DOT O&D Survey, Calendar year 2012 

5 
Figure 6: IPL's Average Seat Departures per Day 

120 

100 

80 

40 

20 

'06 UAX: LAX & 

YUM 

'11 UAX:YUM 

is cancelled in 

February 

'13 Seaport 

enters in May; 

UAX leaves I Pl 

in April 

I 

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 

111 United Airlines Seaport Airlines 

Source: lnnovata Schedules, via Diio, Annual seats divided by 365 days, Calendar Year, in 2013, United's service transitioned to 

Seaport Airlines 

A critical reason for IPL's low passenger performance after Seaport began flying was that Seaport 

initially did not have interline agreements in place to allow passengers and bags to transfer at SAN and 

BUR to other airlines. Furthermore, SAN and BUR service levels offer fewer connecting opportunities 

than LAX. For example, United, the second largest carrier at SAN behind Southwest Airlines, serves 

seven domestic markets, including LAX, with 35 daily flights, compared to 48 domestic and 12 

international markets with 184 daily flights from LAX. Southwest has no interline relationship with any 

carrier across its network. 

As shown on Figure 7, IPL consistently generated approximately twenty passengers per day 2009-2012. 

IPL passenger traffic peaked in 2007 when the airport had nearly twice daily service to LAX and Yuma, 

Arizona ("YUM"). United's service with multiple online and interline connecting opportunities at LAX 

allowed both business and leisure passengers to travel globally and in addition, the larger 30 seat Embraer 

120 aircraft can accommodate more demand. 

6 
Figure 7: Historical Enplanements per Day 

70.0 

60.0 

50.0 

40.0 

30.0 

23.6 19.8 

I I 20.0 

10.0 

0.0 

64.5 

Only year that IPLis below~~ the US DOT's threshold of 10 

en planements per day 

18.5 16.0 17.8 20.6 

1~1- l __ l_i_ 

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 

Source: T -100 Data, via Diio, YE September, Based on 313 days 

Figure 8: El Centro Imperial County Historical Load Factor 

---··~--

60% 

52% 

50% I 

40% ... 34% 28% 0 

~ 29% 30% 111 

u... 30% "'C 

Ill 

.9 

20% 

10% 

0% 

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 

Source: T -100 Data, via Diio, YE September 

During 2007, IPL also reached its highest load factor of 52% as shown on Figure 8. IPL was hard hit by 

the weak economy in 2008, 2009 and 2010 with an immediate decline in traffic and load factor. As IPL 

7 
started to emerge from the recession, air travel increased to 20.6 in 2012. In 2013, the US DOT selected a 

new airiine, Seaport, serving new markets, and passenger traffic decreased. 

This decrease is temporary because the community must adjust to the new air service patterns at IPL, and 

Seaport needed time to negotiate critical interline agreements with other airlines at BUR and SAN. 

In the future, passenger traffic will benefit from the interline agreements that Seaport Airlines has signed 

with Alaska Airlines and Delta Air Lines. Two more interline agreements with other airlines are due to 

be signed shortly. These agreements will greatly help generate passengers at IPL with convenient 

connections at BUR and SAN. 

Conclusion 

Despite the effects of the recession, IPL's traffic levels had remained above the mandatory ten 

enplanements per day by at least six passengers every year except for 2013. Once Seaport's interline 

agreements take effect, IPL should easily exceed the threshold of ten enplanements per day as the flights 

will have the benefit of connecting passengers. 

As such, it is certain that the passenger performance below US DOT mtntmums is a temporary 

circumstance related to the entrance of a new EAS carrier serving new markets from IPL. The 

community of Imperial County is unified in its support of the Seaport service and will take every 

opportunity to use the service when travelling by air. Under these circumstances, I feel a waiver is in 

order and I urge you to grant it forthwith. 

alph Cordova, Jr. 

Imperial County Executive Officer 

8