Order: 2015

- 5

- 13 Served: May 19 , 2015



### UNITED STATES OF AMERICA
DEPARTMENT OF TRANSPORTATION
OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation
on the 19 th of May, 2015

Essential Air Service at

GREENVILLE, MISSISSIPPI

Under 49 U.S.C. 41731 et seq

. DOCKET DOT

- OST

- 2008

- 0209

ORDER PROHIBITING TERMIN A TION OF SERVICE AND REQUESTING PROPOSALS

Summary By this Order, the Department prohibits SeaPort Airlines, Inc. (SeaPort) , from terminating
service at Greenville, Mississippi

, for 30 days beyond the end of the air carrier’s 90

- day notice period, i.e. through September 4 , 2015. The Department is also requesting proposals from air carriers interested in providing Essential Ai r Service (“EAS ”) at Greenville. Proposals are due

June 11, 2015

. (See Appendix A for an area map).

Background
By Order 2014

- 10

- 21 (October 24, 2014)

, the Department selected SeaPort to provide
subsidized EAS to Memphis

, with 18 weekly nonstop round trips

, using 9

- passenger Cessna
Caravan aircraft at an annual subsidy of $1,483,080

.

On May 5, 2015

, SeaPort filed a 90

- day notice to terminate air service at Greenville effective on August 5, 2015. In its notice

, SeaPort states

, “ The F ederal Aviation Administration’s new flight and duty limitations and the implementation of the FAA Air Transport Pilot (ATP) 1,500 hour requirement for First Officers has created a nationwide shortage of pilots in compliance, and, it has pr evented the carrier from operating at Greenville with a high

- degree of schedule reliability. ” Also, the Mayor of Greenville wrote to the Department expressing his disappointment with SeaPort’s “poorly executed start of service

. ” Many flights were
cancel led , although most flights had no passengers booked at the time of cancellation.

The complete public file for EAS at Greenville may be accessed online through the Federal Dockets Management System at: www.regulations.gov by entering “ DOT

- OST

- 2008

- 0209 ”
in the “ Search for Rules, Comments, Adjudications, or Supporting Documents ” field.- 2

-

Hold

- In
SeaPort’s proposed termination of service at Greenville would leave the community with no
scheduled air service

. Thus, the Department must prohibit the air carrier from terminating
such service for 30 days beyond the end of the 90

- day notice period , i.e. through September 4

, 2015

. The Department will require SeaPort to continue to maintain its current level of se rvice

at the community for successive 30

- day periods until the Department ha s completed processing the air carrier

- replacement case and the selected air carrier has actually started
service. 1

Recent Legislative Changes Affecting Greenville
The FAA Modernization and Reform Act of 2012 amended 49 U.S.C. § 41731(a)(1)(B) to change the definition of “eligible place” for the purpose of receiving EAS. The amendment states that to be eligible, a community must maintain an average of 10 enplanements or more

per service day, as determined by the Secretary, during the most recent fiscal year beginning
after September 30, 2012. The legislation exempts locations in Alaska and Hawaii and
communities that are more than 175 driving miles from the neares t large or m edium hub airport. 2 The Secretary also has the authority to waive the 10

- enplanement standard, on an annual basis, if the community can demonstrate that the reason the location averages fewer than 10 enplanements per day is due to a temporary decline in e nplanements. 3

By Order 2014

- 4

- 26, issued on April 24, 2014, the Department issued a show

- cause Order tentatively terminating Greenville’s eligibility in the EAS program for failing to meet the 10

- enplanem e nt standard . The Department ultimately granted Gr eenville a waiver from that provision through September 30, 2015

, from the 10

- enplanement standard by Order 2014

- 9

- 21

.

R e qu e st f or P r o p osals In order to provide sufficient time to complete the carrier

- selection process before SeaPort terminates its service, the Department is here by requesting proposals from air carriers interested in providing service at Greenville, with or without subsidy support. Air carriers should file their proposals no later than June 11, 2015 After that date, proposals will be
docketed , thereby making them public, and the Department will serve copies of the proposal s on the civic parties and other applicants. Shortly thereafter, the Department will provide a summary of the proposals to community officials and ask them to submit their
final comments. The Department will give full consideration to all proposals filed in a timely manner

. 4

The Department expects proposals that are consistent with what the community currently

1 In accordance with 49 U.S.C. 41734(c), we will extend SeaPort ’s service obligation for successive 30

- day periods as necessary until replacement service actually begins.

2 49 U.S.C. § 41731(c) & (d).

3 49 U.S.C. § 41731(e).

4 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, required by 49 U.S.C. § 41732, can be reliably provided without such compensation, we typic ally do not proceed with the carrier

- selection case. Instead, the Department simply
rel ies on that carrier’s subsidy

- free service as proposed.- 3

-

receives, namely, 18 weekly nonstop round trips, using 9

- passenger aircraft to Memphis or another suitable hub airport. If service is provided with larger aircraft, we expect proposals for 12 round trips a week. The Department encourage s proposals that meet these guidelin es in
an efficient manner. Air carriers are also welcome to propose more than one service option, if they choose. They also need not limit themselves to these requirements if they envision other, potentially more attractive service possibilities

-- differe nt hubs or length of contract, for example

-- with subsidy requirements that remain competitive.

The Department is here by providing interested air carriers with some basic information to serve as guidance when they prepare their proposals, but the Departm ent will not prescribe a precise format for their proposals. The Department expect s 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, the Department recommend s they include info rmation concerning proposed schedules and projected block hours. In addition, applicants are encouraged to provide financial data supporting their subsidy requests, including information on their projected expenses and revenues. The Department strongly e ncourage s clear, well

- documented proposals that will facilitate their evaluation by Greenville and the Department. 5

Filing Procedures Carrier proposals should be submitted to the Department with all materials merged into a single document. In addition, b ecause the document will be published on Regulations.gov, each page should be formatted to be viewed online.

Service and Traffic History In order to assist carriers in making their passenger and revenue forecasts, we have included historical traffic data is in Appendix B.

Other Carrier Requirements The Department is responsible for implementing various Federal statutes governing lobbying activities, drug

- free workplaces, and nondiscrimination. 6 Consequently, all carriers receiving Federal subsidy for EAS must certify that they are in compliance with Department regulations regarding drug

- free workplaces and nondiscrimination, and those ca rriers whose subsidies

5 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: (a) service reliability; (b) contractual and marketing arrangements with a larger carrier at the hub; (c) int erline arrangements with a larger carrier at the hub; (d) community views, giving substantial weight to the views of the elected officials representing the users; and (e) whether the carrier has included a plan in its proposal to market its service to the community. In addition, the Consolidated A ppropriations Act, 201 4 , Public
Law No. 11 3

- 76, and continued in the Continuing Appropriations Resolution, 2015, Public Law No. 113

- 164

, provides that when selecting a carrier to provide EAS, the Department may c onsider the relative subsidy requirements, thus codifying a factor that we have considered since the inception of the program.

6 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; (3) 49 CFR Part 27

-- Nondiscrimination on the Basis of Disability in Programs and Activities Re ceiving or Benefiting from Federal Financial Assistance; (4)

14 CFR Part 382

-- Nondiscrimination on the Basis of Disability in Air Travel; and (5) 49 CFR Part 29

-- Government

- Wide Debarment and Suspension (Non

- Procurement) and Government

- Wide Requiremen ts for Drug

Free Workplace (Grants).- 4

-

exceed $100,000 over the life of the contract 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, all carriers that plan to submit proposals involving subsidy should be aware that the selected carrier will be required to complete the required certifications. Interested carriers requiring more detailed information regarding these requi rements should contact the Offic e of Aviation Analysis at (202) 366

- 5903. 7

Community Comments
Civic officials and the state s are welcome to submit comments at any time. The Department

encourage s prospective appl icants to contact communities before they submit their proposals so that they can tailor them to the communit y ’ s needs, as they will not be able to amend them after the due date. As noted earlier, the Department will provide a summary of the proposals to the civic parties shortly after the deadli ne for carrier proposals, and ask them to submit their
final comments.

ACCORDINGLY,
1. The Department prohibit s SeaPort Airlines , Inc. from suspending service at Greenville, Mississippi , at the end of the 90

- day notice period (August 5 , 2015) , and require it to maintain
its current level of service at the commu nity , as set forth in Appendix C , for an initial 30

- day period through September 4 , 2015 , or until an air carrier capable of provid ing reliable EAS actually begins service, whichever is first;

2

. The Department request s that air carriers interested in providing EAS at Greenville

, Mississippi submit their proposal, with or without subsidy requests, no later than June 11, 2015 . The proposal should be emailed to: EAS@dot.gov with the title “Proposal to

Pro vide EAS at Greenville ”; 8

3

. Th is docket will remai n open until further O rder of the Department; and

7 The certifications are also available on the web at http://www.dot.gov/policy/aviation

- policy/small

- community

rural

- air

- service/essential

- air

- service

. 8 Questions regarding filings in response to this Order may be directed to Michael Martin (for Crescent City) at (202) 366

- 6494 or michael.f.martin@dot.gov

.- 5

-

4

. The Department will serve copies of this O rder on the mayo r of Greenville, Mississippi

, the airport manager s at Greenville Mid

- Delta Airport

, and the service list for th is docket.

By:

BRANDON M. BELFORD Deputy Assistant Secretary for

Aviation and International Affairs

(SEAL) An electronic version of this document is available

o nline at http://www.regulations.gov

.Appendix A



### AREA MAP

Maps generated by the Great Circle Mapper

- copyright © Karl L. SwartzAppendix B

EAS Carrier Traffic at Greenville (GLH) 1

Quarter Year Deplanements Enplanements Total Traffic Enplanements per Day

4 2011 2010 2008 4,018 25

1 2012 1289 1277 2,566 17

2 2012 1544 1563 3,107 20

3 2012 1463 1484 2,947 19

Annual

Totals 6,306 6,332 12,638 20

4 2012 814 793 1,607 10

1 2013 764 753 1,517 10

2 2013 583 734 1,317 8

3 2013 716 679 1,395 9

Annual

Totals 2,877 2,959 5,836 9

4 2013 635 658 1,293 8

1 2014 468 469 937 6

2 2014 553 531 1,084 7

3 2014 534 499 1,033 7

Annual

Totals 2,190 2,157 4,347 7 Greenville, Mississippi

1 T100 Market Enplanement Data FY ending September 30.App endix C

Essential Air Service to be Maintained

Effective Period: September 4 , 2015 , until further Department action

Scheduled Service:

• 18 weekly nonstop round trips from Greenville (GLH) to Memphis (MEM )

Aircraft: 9

- passenger Cessna Grand CaravanAppendix D

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 addi tion, 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 ma y 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 payme nt 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 u nilaterally, either partially or complete, 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 st ipulated 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 mut ually agreed to in writing by the Department and carrier do not constitute a total or partial reduction or cessation of payment.

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 sufficient funds are not made available for performance beyond [DATE], the Department will provide notice in writing to the carrier.

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.

All claims for payment, including any amended claims, m ust be submitted within 90 days of the last day of the month for which compensation is being claimed. For example, claims for service provided in July must be filed by October 31 st ; August claims must be submitted by November
30 th , and so on.