Order 2013-10-1

Served: October 1, 2013

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 1st of October, 2013

Essential Air Service at

BUTTE, MONTANA

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

DOCKET DOT-OST-2011-0136

ORDER REQUESTING PROPOSALS

Summary

By this Order, the Department is requesting proposals by October 24, 2013, from carriers 

interested in providing Essential Air Service (EAS) at Butte, Montana, beginning January 1, 

2014, for a period of two or more years, with or without subsidy. 

Background

By Order 2012-1-23, January 26, 2012, the Department selected SkyWest Airlines

(SkyWest), to provide 14 nonstop round trips per week between Butte, Montana, and Salt 

Lake City, Utah, through December 31, 2013.1 All of SkyWest’s service is provided 

with 50-seat regional jet aircraft and the annual subsidy is set at $672,230. 

Request for Proposals

As the end of the current rate term approaches, we are requesting proposals from carriers 

interested in providing service at Butte, with or without subsidy, for the period beginning 

January 1, 2014. Carriers should file their proposals by October 24, 2013. Staff will then 

docket the proposals, thereby making them public. Shortly afterwards, we will provide a 

summary of the proposals to the community and ask them to submit their final comments. 

We will give full consideration to all proposals filed in a timely manner.2 Interested 

carriers should prepare their proposals with every expectation that their initial proposals 

will also be their final and only proposals. We retain the discretion to negotiate proposals 

with carriers when we deem it desirable. We also retain the discretion to reject outright 

all unreasonable or unrealistic proposals and, if necessary, solicit a new round of 

 1 Order 2012-1-23 also selected SkyWest to provide EAS at Aberdeen, SD, and Bemidji, MN. We will 

deal with those communities separately. 2 Carriers should not expect the Department to accept late filings. In cases where a carrier proposes to 

provide EAS without subsidy and we determine that basic EAS, as required by 49 U.S.C. §41732, can be 

reliably provided without such compensation, we typically do not proceed with the carrier-selection case. 

Instead, we simply rely on that carrier’s subsidy-free service as proposed.
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proposals. However, we anticipate that negotiation or rejection will remain only 

occasional exceptions to the rule.

We are here providing interested carriers with some basic information to serve as 

guidance when they prepare their proposals, but we will not prescribe a precise format for 

their proposals. We expect proposals to adequately describe the service being proposed 

and the annual amount of subsidy being requested. The applicants can make their own 

judgments as to the level of detail they wish to present; however, we recommend that 

they include information concerning proposed schedules and projected block hours. In 

addition, applicants are urged to provide financial data supporting their subsidy requests, 

including information on their projected expenses and revenues. We strongly encourage 

clear, well-documented proposals that will facilitate their evaluation by the community

and the Department. We anticipate applying our usual carrier-selection criteria and the 

general provisions governing subsidy payments for EAS.3 

As always, we will formally solicit the community’s views on any service options we 

receive before making a long-term, carrier-selection decision. The community and air 

carriers are encouraged to work together in advance of the due date for proposals to craft 

a service pattern that is both desirable to the community and meets the operational needs 

of the airlines, as carriers cannot amend their proposals after the due date. 

We encourage proposals that meet the community’s requirements in an efficient manner. 

Butte is a strong traffic generator and so we will request the maximum service level at the

community – 67 seats per day in both directions and a minimum of two round trips per 

day.4 Carriers are also welcome to propose more than one service option, if they choose; 

they need not limit themselves to a single specific service pattern if they envision other, 

potentially more attractive service possibilities – different hubs, or longer terms for the 

contracted service – with subsidy requirements that remain competitive.

Filing Format

Carrier proposals should be submitted to the Department with all materials merged into a 

single document. In addition, because the document will be published on 

Regulations.gov, each page should be formatted to be viewed online.

Historical Traffic

In order to assist carriers in making traffic and revenue projections, we have included 

historical traffic for the community in Appendix B for the most recent annual periods. 

 3 In selecting a carrier to provide subsidized EAS for an eligible place not in Alaska, 49 U.S.C. § 41733(c) 

(1) directs us to consider five factors: (1) service reliability; (2) contractual and marketing arrangements 

with a larger carrier at the hub; (3) interline arrangements with a larger carrier at the hub; (4) communities

views; and (5) whether the carrier has included a plan in its proposal to market the service. In addition, The 

Consolidated and Further Continuing Appropriations Act, 2012, Public Law No. 112-55, and continued by 

the Full-Year Continuing Appropriations Act, 2013, Public Law No. 113-6, provides that when selecting a 

carrier to provide EAS, the Department may consider the relative subsidy requirements, thus codifying a 

factor that we have considered since the inception of the program. Interested carriers should also be aware 

that our general provisions governing EAS will be included in the selection Order as part of our 

authorization of subsidy for the selected service. Appendix C of this Order contains those general 

provisions.

4 This works out to two round trips per day with regional jets, three round trips per day (18 a week) with 

30-seat aircraft, and four round trips per day (24 a week) with 19-seat aircraft.
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Other Carrier Requirements

The Department is responsible for implementing various Federal statutes governing lobbying 

activities, drug-free workplaces, and nondiscrimination.5 Consequently, all carriers receiving 

Federal subsidy to support EAS must certify that they are in compliance with Department 

regulations regarding drug-free workplaces and nondiscrimination, and those carriers whose 

subsidies exceed $100,000 over the life of the rate term must also certify that they are in 

compliance with the regulations governing lobbying activities. Because the Department is 

prohibited from paying subsidy to carriers that do not submit these documents, the selected 

carrier will be required to submit them in order to receive subsidy. Interested carriers 

requiring more detailed information regarding these requirements, as well as copies of the 

certifications, should contact the Office of Aviation Analysis at (202) 366-5903. 

Community Comments

Civic officials and the State are welcome to submit comments on the proposals at any time. 

As noted earlier, we will provide a summary of the proposals to the civic parties and ask 

them to submit their final comments shortly after October 24, 2013, the due date for carrier 

proposals.

This Order is issued under authority delegated in 49 CFR Part 1.25a(b) and re-delegated 

to the Director, Office of Aviation Analysis.

ACCORDINGLY,

1. The Department requests proposals from carriers interested in providing EAS at Butte, 

Montana. Carriers should submit proposals, with subsidy if necessary, by October 24, 

2013. Proposals should be emailed to EAS@dot.gov, with the title “Proposal to Provide 

EAS at Butte, Montana”6;

2. This Docket will remain open until further Order of the Department; and

3. We will serve this Order on the service list for this Docket.

Persons entitled to petition the Department for review of this Order under the 

Department’s Regulations, 14 CFR Part 385.31, must file such petitions within seven (7) 

days after the date of service of this Order. 

 

5 The certifications are available on the web at

http://www.dot.gov/policy/aviation-policy/small-community-rural-air-service/essential-air-service. 6 Questions regarding filings may be directed to Kevin Adams at 202-366-1047 or Kevin.Adams@dot.gov
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This Order will be effective immediately, and the filing of a petition for review shall not 

preclude its effectiveness.

By: 

TODD M. HOMAN

Director

Office of Aviation Analysis

(SEAL)

An electronic version of this document is available at

http://www.regulations.gov
Appendix A

Nonstop Great Circle Miles to Butte (BTM)

BZN, Bozeman 66

MSO, Missoula 101

BIL, Billings 191

BOI, Boise 247

GEG, Spokane 265

SLC, Salt Lake 358

SEA, Seattle 477

DEN, Denver 578

SFO, San Francisco 768

MSP, Minneapolis 938
Appendix B

Historical Scheduled Passengers at Butte, Transported by SkyWest, T-100 Market Report

Year Month Origin Dest O&D

2010 8 2,725 2,583 5,308

2010 9 2,419 2,373 4,792

2010 10 2,169 2,127 4,296

2010 11 1,803 1,740 3,543

2010 12 1,960 1,917 3,877

2011 1 1,638 1,541 3,179

2011 2 1,568 1,455 3,023

2011 3 1,845 1,827 3,672

2011 4 1,748 1,763 3,511

2011 5 2,059 2,062 4,121

2011 6 2,183 2,206 4,389

2011 7 2,341 2,285 4,626

YE July 31, 2011 24,458 23,879 48,337

2011 8 2,422 2,280 4,702

2011 9 2,383 2,309 4,692

2011 10 2,016 1,781 3,797

2011 11 1,685 1,650 3,335

2011 12 1,831 1,656 3,487

2012 1 1,458 1,525 2,983

2012 2 1,466 1,384 2,850

2012 3 1,686 1,523 3,209

2012 4 1,545 1,612 3,157

2012 5 1,671 1,692 3,363

2012 6 1,604 1,691 3,295

2012 7 2,098 2,054 4,152

YE July 31, 2012 21,865 21,157 43,022

2012 8 2,080 2,085 4,165

2012 9 1,742 1,466 3,208

2012 10 1,741 1,729 3,470

2012 11 1,668 1,627 3,295

2012 12 1,712 1,629 3,341

2013 1 1,551 1,487 3,038

2013 2 1,426 1,375 2,801

2013 3 2,211 2,091 4,302

2013 4 2,012 2,086 4,098

2013 5 2,470 2,435 4,905

2013 6 2,688 2,915 5,603

2013 7 3,016 3,095 6,111

YE July 31, 2013 24,317 24,020 48,337
Appendix C

Example of General Terms and Conditions for Essential Air Service

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 this rate, 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 communities.

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 may not be available for performance under this Order beyond [DATE]. The 

Government’s obligation for performance under this Order beyond [DATE], is subject to 

the availability of 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 [DATE], until funds are made available to the Department for 

performance. If funds are not made available for performance beyond [DATE], the 

carrier will receive notice in writing by the Department.

All claims for payment must be submitted within 60 days of the last day of service 

provided under this Order