BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY, WASHINGTON D.C. April 4, 2013 -''. ; .. ·. ' ..

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Essential Air Service at: TATITLEK, AK Under 49 U.S.C. 41731 etseq. DOCKET DOT-OST-2013-0030



### J &MAlaskaAirTours, Inc. dbaAlaskaAir Transit hereby submitsthis proposal to provide subsidized essential air service to Tatitlek, Alaska for a contract period oftwo years. PROPOSED SCHEDULE AlaskaAir Transit is submitting three proposals. All proposals provide three scheduled flights per week between Anchorage and Tatitlek, Alaska. ProposalsA and C are for three direct, non-stop flights per week. Proposal B is for two direct, non-stopflights per week and one triangle flight per week, to be shared with the neighboring community of Chenega Bay. Our proposed schedule would operate year-round, every Monday, Wednesday, and Friday. If weather required postponement of a flight, service would be rescheduled to the nextflyable day. The schedule would operate in one ofAlaskaAir Transit's two IFR-equipped seven-seat Navajo Chieftain aircraft. AlaskaAirTransit would maintain the right to upgrade service to our nine-seat Cessna Grand Caravan or our nine-seat Pilatus PC-12 at the company's discretion for no additional subsidy. HISTORY AlaskaAir Transit has been serving communities in Prince William Sound since the current owners purchased the business in the spring of 2004. Overthe past nine years, AlaskaAir Transit has grown from two full-time employees and two aircraft to thirteen full-time employees and four aircraft, and has been recognized as an industry leader in safety and customer service. AlaskaAir Transit has expanded from an exclusively ondemand charter operation, to include scheduled service between Anchorage and several Alaskancommunities off the road system. Currently, AlaskaAirTransit offers three scheduled flights perweekto Chenega Bay, with aflag-stop in Tatitlek. Regular patrons of our service include medical patients, health care providers, teachers, students, village managers, maintenance technicians, cruise ship pilots, and local families. Without air service, travel between Tatitlek and Anchorage requires an approximatelytwo hour boat ride to Valdez and then a five or more hour drive toAnchorage. The Navajo Chieftain shortens the trip to less than one hour, and offers a safer and more reliable mode oftransport. AlaskaAir Transit has a proven record in Tatitlek, and is supported by both the community leadership and the state and local agencies that serve the community. Page 1 of 5CONCLUSION AlaskaAirTransit has been serving the community ofTatitlek, Alaska for the past nine years. During that time, the community has seen other air carriers enterthe market, only to disappear. AlaskaAirTransit has consistently sought ways to expand service options, improve reliability, and manage affordabilityfor flights to Prince William Sound. Thank you for considering our proposal as we continue to seek opportunities to serve the community ofTatitlek.

Daniel Owen Owner/President AlaskaAirTransit www.flyAAT.com

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## J & M Alaska Air Tours, Inc. (dbaAlaska Air Transit) Proposal to Provide Essential Air Serviceto Tatitlek, Alaska Docket DOT-OST-2013-0030 Proposal A Weekly round-trip schedule Aircraft Type Direct non-stop Mon/Weds/Fri Navajo Chieftain*
*This proposal is bid as a seven seat Navajo Chieftain, with the option to upgrade to a nine seat Cessna Grand Caravan or nine seat Pilatus PC-12 at the company's discretion, for no additional subsidy.

Direct Operating Costs Pilot Fuel Maintenance

Indirect Operating Costs Insurance Aircraft 

### &Hangar Lease General &Administrative

Total Operating Costs Profit Return@10% TOTAL ECONOMIC COST

Revenue Source EXPENSES Per Hour $95 $240 $175

Per Hour $70 $122 $261

REVENUES Per Flight $152 $384 $280 $816 Per Flight $112 $195 $418 $725 $1541 per flight $ 154 per flight $1695 perflight $264,420 per year

Passengers 520 seats peryear@ $180 per seat $93600 Freight 10000 lbs. peryear @ .75 cents per lb. $ 7500 TOTAL PROJECTED GROSS REVENUE $101,100 per year
TOTAL PROJECTED NET REVENUE (subtracts FET)

PROPOSED SUBSIDY Per Direct Non-stop Flight MaximumAnnual Subsidy (156 flights @100% completion) $648 perflight $94,047 per year $603 perflight

$1092 $170,373
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### J 

## &M AlaskaAir Tours, Inc. (dbaAlaskaAir Transit) Proposal to Provide Essential Air Serviceto Tatitlek, Alaska Docket DOT-OST-2013-0030 Proposal B Weekly round-trip schedule Aircraft Type Direct non-stop 2x/wk, Triangle 1 x/wk Navajo Chieftain*
*This proposal is bid as a seven seat Navajo Chieftain, with the option to upgrade to a nine seat Cessna Grand Caravan or nine seat Pilatus PC-12 at the company's discretion, for no additional subsidy.
Direct Operating Costs Pilot Fuel Maintenance

Indirect Operating Costs

Insurance Aircraft & Hangar Lease General &Administrative

Total Operating Costs Profit Return@10% EXPENSES Per Hour $95 $240 $175

Per Hour $70 $122 $261 Per Direct Flight $152 $384 $280 $816 Per Direct Flight $112 $195 $418 $725 $1541 per direct flight $ 154 per directflight $1695 per directflight PerTriangle Flight $95 $240 $175 $510 (pro-rated) PerTriangle Flight $70 $122 $261 $453 (pro-rated) $ 963 pertriangle $ 96 per triangle $1059 per triangle Two direct flights per week @$1695 per flight x 52 weeks $176,280 One triangle flight per week @$1059 perflight x 52 weeks $ 55.068 TOTAL ECONOMIC COST $231,348 REVENUES Revenue Source Passengers 520 seats per year@ $180 per seat $93600 Freight 10000 lbs. per year @ .75 cents per lb. $ 7500 TOTAL PROJECTED GROSS REVENUE $101,100 per year TOTAL PROJECTED NET REVENUE (subtracts FET)

Per Direct Non-stop Flight Per Pro-Rated Triangle Flight PROPOSED SUBSIDY

MaximumAnnual Subsidy (156 flights @100% completion) $648 perflight $94,047 per year $603 per flight
$1092

$456 $137,301
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## J & MAlaskaAirTours, Inc. (dbaAlaskaAirTransit) Proposal to Provide Essential Air Serviceto Tatitlek, Alaska Docket DOT-OST-2013-0030
Weekly round-trip schedule Aircraft Type Proposal C Direct non-stop Mon/Weds/Fri Navajo Chieftain*
*This proposal is bid as a seven seat Navajo Chieftain, with the option to upgrade to a nine seat Cessna Grand Caravan or nine seat Pilatus PC-12 at the company's discretion, for no additional subsidy.
Direct Operating Costs Pilot Fuel Maintenance

Indirect Operating Costs Insurance Aircraft 

### &Hangar Lease General &Administrative

Total Operating Costs Profit Return@10% TOTAL ECONOMIC COST

Revenue Source EXPENSES Per Hour $95 $240 $175

Per Hour $70 $122 $261

REVENUES Per Flight $152 $384 $280 $816 Per Flight $112 $195 $418 $725 $1541 per flight $ 154 per flight $1695 per flight $264,420 per year

Passengers 520 seats per year @$180 per seat $93600 **Mail 32000 lbs. per year @$1 per lb. $32000 Freight 10000 lbs. per year @ .75 cents per lb. $ 7500 TOTAL PROJECTED GROSS REVENUE $133,100 per year TOTAL PROJECTED NET REVENUE (subtracts FET)
PROPOSED SUBSIDY Per Direct Non-stop Flight Maximum Annual Subsidy (156 flights @100% completion) $853 perflight $123,814 per year $794 per flight
$901 $140,606 **Note: This proposal is contingent uponAlaskaAirTransit being awarded thecontract totransport mail directly between Anchorageand Tatitlek, without requiring routing through anyotherterminal.
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