Order 2013-11-3

Served: November 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 November, 2013

Essential Air Service at

SIOUX CITY, IOWA, and

WATERLOO, IOWA

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

DOCKET DOT-OST-2011-0131

DOCKET DOT-OST-2011-0132

ORDER REQUESTING PROPOSALS

Summary

By this Order, the Department is requesting proposals no later than December 2, 2013, from 

carriers interested in providing Essential Air Service (EAS) at Sioux City and/or Waterloo, 

Iowa, for the period beginning May 1, 2014, for two or more years, with or without subsidy. 

Background

By Order 2011-12-2, December 8, 2011, the Department selected American Eagle 

Airlines (American Eagle) to provide 13 nonstop round trips per week each between 

Sioux City and Waterloo, Iowa, and Chicago O’Hare International Airport (ORD), for a 

two-year period beginning when American Eagle inaugurated EAS at both communities 

through the end of the 24th month thereafter. The carrier inaugurated service at both 

communities on April 3, 2012, thus making the expiration date April 30, 2014. All of 

American Eagle’s service is provided with regional jet aircraft having 44 or more seats 

and the annual subsidy is set at $1,512,799 at Sioux City and $1,541,824 at Waterloo. At 

Sioux City, the carrier was selected to provide service with 50-seat aircraft, and 44-seat 

aircraft at Waterloo.

Request for Proposals

As the end of the current rate terms approach, we are requesting proposals from carriers 

interested in providing service at Sioux City and/or Waterloo, with or without subsidy, 

for the period beginning May 1, 2014. Carriers should file their proposals by 

December 2, 2013. Staff will then docket the proposals, thereby making them public. 

Shortly afterwards, we will provide copies of all timely filed proposals to the 

communities and request community comments by a specified date. We will give full 
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consideration to all proposals filed in a timely manner.1 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 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 communities

and the Department.2 

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

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

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

service patterns that are both desirable to the communities and meet the operational needs 

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

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

Waterloo and Sioux City are strong traffic generating communities and so we expect 

proposals to be consistent with what the communities are currently receiving, namely 13 

nonstop round trips per week using regional jets to Chicago O’Hare or another suitable 

hub.3 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.

 

1 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 typically do not proceed with the carrier-selection case. 

Instead, we simply rely on that carrier’s subsidy-free service as proposed.

2 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) community

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.

3 This works out to two round trips per day with regional jets, three round trips per day with 30-seat 

aircraft, and four round trips per day with 19-seat aircraft.
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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 

www.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 communities in Appendix B for the most recent annual periods. 

For the most recent 12-month period for which data are available, Sioux City had 81

enplanements per day, and Waterloo had 60. 

Other Carrier Requirements

The Department is responsible for implementing various Federal statutes governing lobbying 

activities, drug-free workplaces, and nondiscrimination.4 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. The 

Department is prohibited from paying subsidy to carriers that do not submit these documents.

Community Comments

Civic officials and the States 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 December 2, 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 Sioux 

City, Iowa, and/or Waterloo, Iowa. Carriers should submit proposals, with subsidy if 

necessary, by December 2, 2013. Proposals should be emailed to EAS@dot.gov, with the 

title “Proposal(s) to Provide EAS at Sioux City, Iowa, and/or Waterloo, Iowa” 5;

2. These Dockets will remain open until further Order of the Department; and

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

 

4 The certifications are available on the web at

http://www.dot.gov/policy/aviation-policy/small-community-rural-air-service/essential-air-service.

5 Questions regarding filings may be directed to Kevin Adams at 202-366-1047 or Kevin.Adams@dot.gov
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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. 

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 Sioux City (SUX)

OMA, Omaha, 80

FSD, Sioux Falls, 83

FOD, Fort Dodge, 112

DSM, Des Moines 152

MCW, Mason City, 164

RST, Rochester, 222

MSP, Minneapolis, 233

ORD, Chicago, 436

Nonstop Great Circle Miles to Waterloo (ALO)

CID, Cedar Rapids 58

MCW, Mason City, 63

DBQ, Dubuque 87

FOD, Fort Dodge, 91

RST, Rochester, 93

MLI, Moline, 124

MSP, Minneapolis 166

ORD, Chicago 234
Appendix B-1

 Historical Traffic between Sioux City, Iowa (SUX), and Minneapolis (MSP) and Chicago (ORD) 1/

Passengers Flights Passengers

Hub Enplaned Deplaned O&D To Hub From Hub Total Per Flight

2010 9 MSP 2,238 2,303 4,541 83 82 165 27.5

2010 10 MSP 2,505 2,422 4,927 88 88 176 28.0

2010 11 MSP 2,416 2,389 4,805 82 82 164 29.3

2010 12 MSP 2,503 2,514 5,017 85 85 170 29.5

2011 1 MSP 2,109 2,047 4,156 86 86 172 24.2

2011 2 MSP 1,741 1,744 3,485 73 73 146 23.9

2011 3 MSP 1,937 2,064 4,001 89 89 178 22.5

2011 4 MSP 1,973 2,067 4,040 84 83 167 24.2

2011 5 MSP 2,302 2,286 4,588 86 86 172 26.7

2011 6 MSP 2,256 2,437 4,693 83 83 166 28.3

2011 7 MSP 2,708 2,767 5,475 81 80 161 34.0

2011 8 MSP 2,932 2,949 5,881 87 87 174 33.8

YE 8/31/11 27,620 27,989 55,609 1,007 1,004 2,011 27.7

2011 9 MSP 2,471 2,467 4,938 63 63 126 39.2

2011 10 MSP 2,459 2,468 4,927 62 61 123 40.1

2011 11 MSP 2,260 2,240 4,500 57 57 114 39.5

2011 12 MSP 2,313 2,296 4,609 57 57 114 40.4

2012 1 MSP 2,022 1,983 4,005 57 57 114 35.1

2012 2 MSP 1,834 1,860 3,694 52 52 104 35.5

2012 3 MSP 1,873 1,881 3,754 53 53 106 35.4

2012 4 MSP 100 95 195 3 4 7 27.9

2012 4 ORD 2,067 2,082 4,149 56 55 111 37.4

2012 5 ORD 2,361 2,281 4,642 54 54 108 43.0

2012 6 ORD 2,296 2,383 4,679 54 54 108 43.3

2012 7 ORD 2,308 2,392 4,700 57 57 114 41.2

2012 8 ORD 2,445 2,603 5,048 58 57 115 43.9

YE 8/31/11 26,809 27,031 53,840 683 681 1,364 39.5

2012 9 ORD 2,445 2,389 4,834 55 55 110 43.9

2012 10 ORD 2,227 2,284 4,511 58 58 116 38.9

2012 11 ORD 2,141 2,157 4,298 55 55 110 39.1

2012 12 ORD 2,071 2,054 4,125 55 55 110 37.5

2013 1 ORD 1,890 1,843 3,733 56 56 112 33.3

2013 2 ORD 1,759 1,789 3,548 49 49 98 36.2

2013 3 ORD 2,024 2,148 4,172 54 54 108 38.6

2013 4 ORD 1,923 2,020 3,943 51 51 102 38.7

2013 5 ORD 2,372 2,221 4,593 56 56 112 41.0

2013 6 ORD 2,177 2,297 4,474 54 54 108 41.4

2013 7 ORD 2,119 2,183 4,302 58 58 116 37.1

2013 8 ORD 2,184 2,297 4,481 57 57 114 39.3

YE 8/31/11 25,332 25,682 51,014 658 658 1,316 38.8

Source: T-100 Segment Report

1/ Prior to American Eagle's selection at Sioux City, Delta Connection served the community on a subsidyfree basis to Minneapolis.
Appendix B-2

 Historical Traffic between Sioux City, Iowa (SUX), and Minneapolis (MSP) and Chicago (ORD)

Passengers Flights Passengers

Hub Enplaned Deplaned O&D To Hub From Hub Total Per Flight

2010 9 MSP 1,982 2,031 4,013 86 85 171 23.5

2010 10 MSP 2,057 1,947 4,004 87 87 174 23.0

2010 11 MSP 1,894 1,913 3,807 82 82 164 23.2

2010 12 MSP 1,903 1,865 3,768 79 78 157 24.0

2011 1 MSP 1,548 1,590 3,138 63 61 124 25.3

2011 2 MSP 1,443 1,418 2,861 53 52 105 27.2

2011 3 MSP 1,845 1,891 3,736 88 88 176 21.2

2011 4 MSP 1,612 1,576 3,188 89 89 178 17.9

2011 5 MSP 1,837 1,833 3,670 85 85 170 21.6

2011 6 MSP 2,011 1,991 4,002 88 87 175 22.9

2011 7 MSP 1,868 1,855 3,723 84 83 167 22.3

2011 8 MSP 1,795 1,991 3,786 89 88 177 21.4

YE 8/31/11 21,795 21,901 43,696 973 965 1,938 22.5

2011 9 MSP 1,515 1,503 3,018 64 63 127 23.8

2011 10 MSP 1,592 1,527 3,119 62 62 124 25.2

2011 11 MSP 1,576 1,598 3,174 58 58 116 27.4

2011 12 MSP 1,731 1,653 3,384 59 60 119 28.4

2012 1 MSP 1,267 1,381 2,648 53 52 105 25.2

2012 2 MSP 1,419 1,342 2,761 47 47 94 29.4

2012 3 MSP 1,531 1,670 3,201 52 53 105 30.5

2012 4 MSP 132 65 197 3 4 7 28.1

2012 4 ORD 1,323 1,367 2,690 56 55 111 24.2

2012 5 ORD 1,881 1,781 3,662 55 55 110 33.3

2012 6 ORD 1,612 1,580 3,192 55 55 110 29.0

2012 7 ORD 1,414 1,347 2,761 56 56 112 24.7

2012 8 ORD 1,234 1,499 2,733 56 55 111 24.6

YE 8/31/12 18,227 18,313 36,540 676 675 1,351 27.0

2012 9 ORD 1,359 1,344 2,703 55 55 110 24.6

2012 10 ORD 1,598 1,544 3,142 57 57 114 27.6

2012 11 ORD 1,685 1,673 3,358 55 55 110 30.5

2012 12 ORD 1,542 1,392 2,934 52 52 104 28.2

2013 1 ORD 1,457 1,605 3,062 56 56 112 27.3

2013 2 ORD 1,497 1,440 2,937 47 47 94 31.2

2013 3 ORD 1,568 1,706 3,274 55 55 110 29.8

2013 4 ORD 1,567 1,635 3,202 52 52 104 30.8

2013 5 ORD 1,838 1,659 3,497 54 55 109 32.1

2013 6 ORD 1,670 1,713 3,383 52 52 104 32.5

2013 7 ORD 1,576 1,659 3,235 56 55 111 29.1

2013 8 ORD 1,481 1,802 3,283 56 56 112 29.3

YE 8/31/13 18,838 19,172 38,010 647 647 1,294 29.4

Source: T-100 Segment Report

1/ Prior to American Eagle's selection at Waterloo, Delta Connection served the community on a subsidyfree basis to Minneapolis.
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 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 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 

Department will provide notice in writing to the carrier. 

All claims for payment, including any amended claims, must 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; August claims must be 

submitted by November 30, and so on.