Order: 2010-12-31 

Served: December 23, 2010 

Pi 

UNITED STATES OF AMERICA 

DEPARTMENT OF TRANSPORTATION 

OFFICE OF THE SECRETARY 

WASHINGTON, D.C. 

Issued by the Department of Transportation 

on the 23rd day of December, 2010 

Essential Air Service at 

MAYAGUEZ, PUERTO RICO 

PONCE, PUERTO RICO 

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

DOCKET DOT-OST-2004-19622 

DOCKET DOT-OST-1999-6592 

ORDER REQUESTING PROPOSALS 

Summary 

By this order, the Department is requesting proposals, by January 21, from carriers interested in 

providing essential air service (EAS) at Mayaguez, for a new two-year period beginning May 1, 

2011, with or without subsidy. (See Appendix A for map.) 

Background 

By Order 2009-3-1, March 3, 2009, the Department selected Hyannis Air Service, Inc. d/b/a 

Cape Air (Cape Air) to continue providing EAS at Mayaguez and Ponce for the two-year 

period through April 30, 2011. That order established annual subsidy rates of $980,980 and 

$740,416 at Mayaguez and Ponce, respectively, for service consisting of four daily nonstop 

round trips to San Juan, with 9-seat Cessna 402 aircraft. 

Special Discussion Concerning Ponce 

For several years, Mayaguez and Ponce have been handled under the same contract because the 

communities are on the same island, receiving service provided by the same carrier. However, 

with respect to this order, we are soliciting proposals for service to Mayaguez only. In addition 

to the service provided by Cape Air, Ponce receives subsidy-free jet service on a daily basis -

one round trip to Orlando and one round trip to New York - provided by JetBlue, with 150-seat 

Airbus A-320 aircraft. That level of service far exceeds Ponce's EAS requirements; therefore, 

consistent with program practice, we will not seek proposals for replacement service at this 

time, but, rather, we will rely JetBlue's subsidy-free service to continue connecting the 
community to the national air transportation system. We note that Ponce's receiving subsidyfree service does not change its status as an EAS community. Should JetBlue in the future 

decide that it no longer intended to serve Ponce, it would first have to file a 90-day notice of its 

intent to suspend service. At that point, the Department would initiate the carrier-selection 

process by issuing an order requesting proposals for replacement service and prohibiting 

JetBlue from leaving until replacement service was in place. 

Request for Proposals at Mayaguez 

As the end of the current rate term approaches, in order to provide sufficient time to complete 

the carrier-selection process before the current contract expires, we are here requesting 

proposals from carriers interested in providing service at Mayaguez, with or without subsidy 

support, for the two-year period beginning May 1, 2011. Carriers should file their proposals no 

later than January 21. Staff will then docket proposals, thereby making them public, and 

shortly afterwards will provide a summary of the proposals to the community and ask them for 

their final comments. We will give full consideration to all proposals filed in a timely manner.' 

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 solicit a new round of proposals. 

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 

aimual amount of subsidy being requested. The applicants can make their own judgments as to 

the level of detail they wish to present; however, they might want to include proposed 

schedules as well as supporting data for their subsidy requests, such as projected block hours, 

revenues and expenses. We strongly encourage clear, well-documented proposals that will 

facilitate their evaluation by the affected community and the Department.^ 

Proposals should provide sufficient capacity to accommodate historical levels of traffic. In 

order to assist carriers in developing traffic and revenue projections for their proposals, we 

have included a summary of historical passengers in Appendix B. Specifically for Mayaguez, 

we expect proposals that are consistent with what the community currently receives (four 

nonstop round trips a day to San Juan). We note that EAS at the community calls for service 

with 15-seat aircraft. However, during the current two-year contract, the community approved 

the service with nine-seat aircraft. For carriers proposing 15-seat or larger aircraft, we expect 

' Carriers should not expect the Department to accept late filings. In cases where a carrier proposes to provide 

essential air service without subsidy and we determine that service can be reliably provided without such 

compensation, we do not proceed with the carrier-selection case. Instead, we simply rely on that carrier's subsidyfree service as proposed. 

2 In selecting a carrier to provide subsidized essential air service, 49 U.S.C. 41733(c)(1) directs us to consider 

four 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; and (4) community views. In addition, the 

Consolidated Appropriations Act, 2008, Public Law 110-161, 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. 
proposals for two round trips a day. Carriers are also welcome to propose more than one 

option, if they choose; they need not limit themselves to those requirements if they envision 

other, potentially more attractive service possibilities — different hubs, frequency or equipment, 

for example — with subsidy requirements that remain competitive. 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 desirable to the communities and meets the operational needs of the 

airlines submitting proposals. 

Traffic IHistory 

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

traffic data in Appendix B. For the year ended June 30, 2010, Mayaquez generated a total of 

8,609 O&D passengers, an average of 13.7 enplanements per day. This represents a slight 

increase from the prior year when there were 8,117 O&D passengers, or an average of 13 

enplanements per day. 

New Filing Procedures 

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. 

Other Carrier Requirements 

The Department is responsible for implementing various Federal statutes governing lobbying 

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

Federal subsidy to support essential air service 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. All carriers that plan 

to submit proposals involving subsidy should submit the required certifications along with their 

proposals. 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. The Department is prohibited from paying subsidy to carriers that 

do not submit these documents.'* 

Community Comments 

Civic officials 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 January 21, the due date for carrier proposals. 

This order is issued under authority delegated in 49 CFR 1.56a(f) and re-delegated to the 

Director, Office of Aviation Analysis. 

^ The regulations applicable to these areas are: (1) 49 CFR Part 20 - New restrictions on lobbying; (2) 49 CFR 

Part 21 - Nondiscrimination in federally-assisted programs of the Department of Transportation - Effectuation of 

title VI of the Civil Rights Act of 1964; 49 CFR Part 27 - Nondiscrimination on the basis of disability in programs 

and activities receiving or benefiting from Federal financial assistance; and 14 CFR Part 382 - Nondiscrimination 

on the basis of disability in air travel; and (3) 49 CFR Part 29 - Government-wide debarment and suspension (nonprocurement) and government-wide requirements for drug-free workplace (grants). 

•* The certifications are also available on the web at http://ostpxweb.dot.gov/aviation/index.html. 
ACCORDINGLY, 

1. We request that carriers interested in providing essential air service at Mayaguez, Puerto 

Rico, submit their proposals, with or without subsidy requests, no later than January 21, 2011. 

Proposals should be emailed to: EAS@dot.gov with the title "Proposal to Provide Essential Air 

Service at Mayaguez, Puerto Rico, Docket DOT-OST-2004-19622";5 

2. These dockets will remain open until further order of the Department; and 

3. The Department will serve a copy of this order on the Puerto Rico Port Authority, the 

Mayors and Airport Managers of Mayaguez and Ponce, Hyannis Air Service, Inc., d/b/a 

Cape Air, and the parties listed in Appendix D. 

Persons entitled to petition the Department for review of this order under the Department's 

Aviation Economic Regulations, 14 CFR 385.50, must file such petitions within ten (10) days 

after the date of service of this order. 

This order will be effective immediately, and the filing of a petition for review shall not 

preclude its effectiveness. 

By: 

(SEAL) 

TODDM/HOMAN 

Director 

Office of Aviation Analysis 

An electronic version of this document is available online at 

www, regulations, fiov 

^ Questions regarding filings in response to this order should be directed to Renee Williams at 202-366-1058, or 

via email at renee.williams@dot.gov. 
Appendix A 

PUERTO RICO 

^vP 

Mayi 

l::: ? 

Ponce 
Appendix B 

Historical O&D Traffic and Average Daily Enplanements 

at Mayaguez, Puerto Rico^ 

Daily Average 

YE 6/30/2010 

3Q09 

4Q09 

IQIO 

2Q10 

TOTAL: 

YE 6/30/2009 

3Q08 

4Q08 

1Q09 

2Q09 

TOTAL: 

O&D Traffic 

1,786 

2,211 

2,491 

2.121 

8,609 

1,704 

2,042 

2,391 

1.980 

8,117 

Enplanements 

11.3 

14.0 

16.0 

13.6 

13.7 

10.8 

12.9 

15.5 

12.7 

13.0 

' Source: USDOT Bureau of Transportation Statistics, TransStats Intermodal Database, Schedule T-100. 

Daily averages are based on 313 (314 during leap years) annual service days (total O&D traffic divided 

by 2, then divided by 313 service days). 
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 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 solicitation beyond [DATE]. The 

Department's obligation for performance under this solicitation beyond [DATE], is contingent 

upon 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 [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. 
Appendix D 

Scheduled Air Carriers. Contiguous US and Puerto Rico 

Air Greco/Wings Air 

Air Sunshine, Inc. 

Air Sunshine, Mirmohammad Adili 

Air Wisconsin, Annette Daly 

Air Wisconsin, Jim Rankin 

Airline Associates, Bill Mishk 

Alaska Airlines, Jeff Cole 

Alaska Airlines, Sandy Sinick 

Allegiant Air, Brian Davis 

American Airlines, Carl Nelson 

American Eagle, Jeffrey Hartz 

Bemidji Aviation, Cori Rude 

Bemidji Aviation, Arlen Rinkenberger 

Cape Air, Andrew Bonney 

Cape Air, Dan Wolf 

Cape Air, J.Flaherty 

Colgan Air, Kevin Scott 

Colgan Air, Mike Colgan 

CommutAir, Andy Price 

CommutAir, Joel Raymond 

Consultant, Robert Silverberg 

Continental, Bruce Keiner 

Continental, Dan Weiss 

Continental, Lorry Halloway 

Delta, Anthony Canitano 

Delta, Dan Shuman 

Delta, Jeff Morgan 

Delta, Joe Esposito 

Delta, Karen Zachary 

Delta, Kristal Murphy 

Delta, Sascha Vanderbellen 

DHS, Bill Ragan 

DHS, David Bernier 

Era Aviation, Mike Lenorman 

Executive Airlines, Kate Soled 

Frontier Flying, Bob Hajducovich 

GemAir/Salmon Air, Dan Schroeder 

GemAir/Salmon Air, JoAnn Wolters 

Great Lakes, Chuck Howell 

Great Lakes, Doug Voss 

Great Lakes, Greg Stephens 

Gulfstream, Dave Hackett 

Gulfstream, Mickey Bowman 

Gulfstream, T. Cooper 

Horizon Air, Dan Russo 

Horizon Air, Jennifer Thompson 

Horizon Air, Mike McQueen 

Horizon, Jeff Cole 

ICEPR, Luis Irizarry 

Intrepid InterntI Air, Rick Eyk 

Island Air Charters, Linda House 

Jet Air, Daniel Wolford 

Kenmore Air, Tim Brooks 

Mesa Air, Michael Lotz 

Mesaba, John Spanjers 

Mesaba, Max Shemesh 

Midwest Airlines, Greg Aretakis 

MN Aviation, Jose Maldonado 

Multi Aero, Darnea 

Multi Aero, Shane Storz 

Northwest Airlines, Aaron Murray 

Northwest, Tim McDonald 

NYDC, Henok Araya 

OST, Brian Swanson 

OST, Dennis DeVany 

OST, Kevin Adams 

OST, Kevin Schlemmer 

OST, Michael Martin 

OST, Renee Williams 

Pacific Wings, Greg Kahlstorf 

PenAir, Danny Seybert 

PenAir, Scott Bloomquist 

Pinnacle Airlines, Joe Williams 

Pinnacle Airlines, Phil Reed 

Planemasters, Inc., John Kessler 

Planemasters, Inc., Paul Berliner 

Planemasters, Inc., Todd DeSimone 

Public Charters, Jim Gallagher 

Scenic, Mary Schneider 

Scenic, Mitzi Daines 

SeaPort/Wings of Alaska, Jim Day 

SeaPort/Wings of Alaska, Nate Vallier 

Seaport/Wings of Alaska, Rob McKinney 

Shuttle America, Jerry Balsano 

SkyWest, Eric Christensen 

SkyWest, Michael Thompson 

SkyWest, Steve Hart 

Sovereign Air, Bob Karns 

Sovereign Air, Lois R. Barton 

Tradewind, Eric Zipkin 

Trans States, Fred Oxley 

Trans States, Gerry Wigmore 

United, Alicia Gabriel 

United, James Starnes 

US Airways, Benjamin Slocum 

US Airways, Howard Kass 

US Airways, Jason Reisinger 

Warbelows Air Ventures, Art Warbelow