Before the 

EAS & Domestic Analysis Division, X-53 

Offic~ of Aviation Analysis, Room 6401 

I)epartment of Transportation f: ]5 

In the Matter Qf: · . ;-

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ESSENTIAL AIR SERVICE Ail' 

RAMPART, ALASKA 

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400 7th Street, S.W. 

Washington, D.C. 20590 

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Docket OST 2008-0201·/l 

· Proposal to ProvidejEssential Air Service at Rampart, Alaska . ' 

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Warbelow's herby submits its proposal to continue subsidized service to Rampart, 

Alaska. This proposal provides an option and subsidy request for two day per week service as 

well as three day per week servic~. In preparing this proposal, it was discovered that while the 

previous RFP prescribed two day! per week service, the subsidy distribution calculation and 

request was for three day per week service. The actual service provided was three days per 

week, which is consistent with the subsidy distribution amount paid. · · 

Appendix A is the option for two day per week service. This would be a reduction to the 

current three day per week schedule, therefore we have adjusted revenue projections downward. 

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Appendix B is the option l'or three day per week service, which is consistent with the 

current EAS subsidy basis. Curr~nt EAS subsidies for Rampart are calculated on figures 

provided by Art Warbelow in thdprevious proposal period--- three day per week service in a 

single engine aircraft. Appendix .B provides the exact same schedule the community has enjoyed 

for the past contract period, albeit in a twin engine aircraft. 

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Regardless oftwo.or thre~ day per week service, the proposed service will be performed 

in a twin engine aircraft with nin~ insured passenger seats. The balance of the capacity is 

reserved for mail and freight. j 

Revenue projections are l),ased on data from 2010 and 2011. Our cost data is based on the 

DOT quarterly F2 numbers from :2010 and 2011. We have used historical costs adjusted for 

known or expected cost changes .. 

The proposed service is direct to Rampart from Fairbanks, and return. 

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Rates I .. 

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Order 2011-06-14 set ne\1\} mail rates that we expect. will be effective at the start of the 

proposed subsidy period, and thetefore we have used those rates to calculate mail revenue. 

, , RTM $13.0147 Rampart 

Terminal/Ton Enplaned $716.16 

Fairbanks-Rampa* 82 miles i 

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Therefore the P-L35 rate ~m Rampart will b~ $0.89 per pound. . . . .. ' 

Current passenger.fares aJjld cargo rates are used in these calculations. These reflect no 

change over the current subsidy ~eriod. 

1 ' Schedule· 

The following schedule h!s been published in the OAG, operated MWF. 

De~art Fairbanks 1310 

Arrive Fairbanks 1350 I 

Depart Fairbanks 1400 

An1ive Fairbanks 1440 

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52 weeks x 3 flights. per we¢k x 1.34 hours per flight= 209.04 hours with a PA31-350 

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~ Projected Demand 

We have no basis for projecting growth in the market, as increasing energy costs have put 

a substantial damper on economi~ activity in rural villages, and even driven a population decline 

as residents move to Anchorage 4fld Fairbanks. We are assuming that the recent decline in 

population in Rampart ha$ stabili~ed, and therefore project future demand equal to current 

demand. ·· 

Projected Expenses 

Fuel costs have been on ah upward trend over the recent years, and account for a large 

part of the cost per hour increase$. We have conservatively estimated future fuel costs based· on. 

the last two years data. ·. 

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See Appendix A & B for ,J>rojected expenses with Piper P A31-3 50 service. 

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Aircraft Type 

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Although service was chaP.ged to a Cessna 206 for the 2010-2012 contract in an effort to 

reduce costs, maintaining ;consistbnt service with this approach was often not viable and the 

Chieftain was utilized to fulfill thie service contract. Rampart's·Iocation often makes it difficult 

to reach using VFR. Since the C~ssna 206 can not be legally flown 4'over the top",, it is often 

necessary to follow the river drainages nearly to the village of Tanana, and then return back up 

the Yukon River valley. While tliere is not yet a GPS approach to Rampart, we expect there will 

be one within two years, and in ahy case the ability to fly over the top frequently allows the flight 

to proceed direct to the Rampart area and then descend through broken conditions that often exist 

in the Yukon River valley, but ndt over the mountains to. the East. Thet:efor~~:WarbelQ.w's of(ers 

for consideration by DOT and th~ village, service in a Piper Chieftain. 

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1 Subsidy Request 

Total Operating Cost 

Profit Element @ 10% of TOC 

Total Economic Cost 

Projected Revenue 

Subsidy need at 100% Completion, 

Subsidy request on an annoal basi~ 

two Year Total Subsidy i I 1. 

Sincerely, 

Matt Atkinson 

Warbelow's Air Venturest Inc. 

3758 University Avenue South 

Fairbanks, Alaska 99709 

adventure@northemalask;a.com ! 

907 388-8571 i 

Two Times 

Per Week 

$96,322.84 

$9,632.28 

$105,955.13 

$29,538.80 

$76,416.32 

$76,416.32 

$152,832.65. 

Three Times 

Per Week 

$144,484.27 

$14,448.43 

$158,932.69 

$39,487.71 

$119,444.99 

$11~,444.99 

$238,889.97 

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WarbeloWi's Air Ventures, Inc. 

, , f:ssef)tia_j Air Se,rviceJo B~ 

· ~rovided At Rampart, Alaska I 

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Block Hours 1.34 per trip 

Aircraft Type: PA 31-350 

·Routing: · Fairbanks > Rampart> Fairbanks 

2tripS'/Wk 

9 seats 

Appendix A 

Two Times Per Week 

139.36 annually 

·REVENUE CALCULATIONS .... , Proj~cted. Based.on· fewer Flights 

, Projectfd .· Passenger Revenue 

Rampart .' · 

Less Passenger Tax 7.5% . 

Passenger Total 

Cargo Revenue 

Rampart· 

Cargo Total 

Mail Revenue 

Rampart 

Mail Total 

Total Revenue 

EXPENSE CALCULATIONS · 

Allocated Block Hours 

Direct Expense 

Pilot & Co-pilot 

Fuel & Oil 

Other 

Maintenance 

Depreciation/Rental 

Total Direct Expense 

.·· .•.. Pax : ~- . Fare , .. · 

' 1'691 ... ·$101.00 

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Pound~ 

1200Q 

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Pounds 

8496j 

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Rate 

$ 0.49 

Rate 

$ 0.89 

PA 31-350 Rate per Block Hour 

139.36 

$ 94.56, 

$166.01 

$ 16.25 

$181.63 

$100.00 

Indirect Expense 

139.36 hr@ $132.73 pr hr 

Total Operating Cost 

Profit Element of TOC 

Total Economic Cost 

0.10 

Subsidy need at 100% Completic;m 

Two Year Total Subsidy · 

.$ 

$ 

$ 

$ 

$ 

Total§ 

17,304.67 

1.207.30 

16,097.36 

5,880.00 

5,880.00 

$ 7,561.44 

$ 7,561.44 

$ 29,538.80 

$ 

$ 

$ 

$ 

$ 

$ 

$ 

13,177.88 

23,135.15 

2,264.60 

25,311.96 

13,936.00 

77,825.59 

18,497.25 

$ 96,322.84 

$ 9,632.28 

$ 105,955.13 

$ 76,416.32 Annually 

$ 152,832.65 
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Warb,low's Air Ventures, Inc. AppendlxB Essential Air Service To Be Three Times Per Week ,, . ~ .. ·· Provi~ed At Rampart, Alaska .. ~ . ~, ~ 

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Block Hours 1.34!per trip 3 trips/wk 209.04 annually Aircraft Type: PA $1-350 9 seats 

Routing: Fairbanks > Rampart> Fair9anks 

REVENUE CALCULATIONS 1 I 

2010·t:ctual 

:.>, Pas§enger Revenu§ ax Fare Totals ' Rarl)part . ?57 $101.00 $ 25,9£?7:00, \ ·.·'- Less Passenger Tax 7.5% I 

~ 1,810.~5 Passenger Total ' ' $ 24,146.05 I 

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Cargo Revenue Pdunds Rate 

Rampart 1$878 $ 0.49 $ 7,780.22 

Cargo Total j 

,, $ 7,780.22 I 

Mail Revenue Pdunds Rate Rampart~~~h1:: ~496 $ 0.89 $ 7,561.44 

Mail. Total I $ 7,561.44 

Total Revenue ! $ 39,487.71 

I , EXPENSE CALCULATIONS I 

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PA 31-350 Rate per Block Hour I 

Allocated Block Hours I 209.04 

Diregt Ex(;!ense 

Pilot & Co-pilot I 

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$ 94.56 $ 19,766.82 Fuel,& Oil $166.01 $ 34,702.73 Other I $ 16.25 $ 3,396.90 Maintenance i $181.63 $ 37,967.94 Depreciation/Rental I 

1 $100.00 $ 20,904.00 Total Direct Expense ! $ 116,738.39 I 

Indirect Ex(;!ense I 

I 139.36hr@ $13f.73 pr ~r $ 27,745.88 I 

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$ Total Ogerating Cost I 144,484.27 i Profit Element of TOC = 0.10 I ~ 14,448.43 Total Economic Cost $ 158,932.69 

Subsidy need at 100% Completion $ 119,444.99 Annually Two Year Total Subsidy $ 238,889.97