UNITED STATES OF AMERICA 

DEPARTMENT OF TRANSPORTATION 

OFFICE OF THE SECRETARY 

WASHINGTON, D.C. 

Issued by the Department of Transportation 

on the 5th day of July, 2012 

Essential Air Service at 

Order 2012-7-4 

Served: July 5, 2012 

CAPE YAKATAGA, ALASKA 

ICY BAY, ALASKA 

DOCKET DOT -OST -1996-2009 

Under 49 U.S.C. §41731 et seq. 

ORDER REQUESTING PROPOSALS 

Summary 

By this Order, the Department is requesting proposals from carriers interested in providing 

Essential Air Service (EAS) at Cape Yakataga and Icy Bay, Alaska, for a new contract period, 

beginning November 1, 2012, with or without subsidy. (See Appendix A for a map). Carriers 

should file their proposals no later than August 7, 2012. 

Background 

By Order 2010-9-21, September 17, 2010, the Department re-selected Alsek Air Service, Inc. 

(Alsek), to provide subsidized EAS at Cape Yakataga and Icy Bay, Alaska, through October 

31, 2012. Under that Order, Alsek provides three round trips each week toYakutat from May 

through October, and two round trips each week from November through April, with an 

intermediate stop at Icy Bay, utilizing four-seat Cessna aircraft, at an annual subsidy rate for 

both communities of$91,000. 

Request for Proposals 

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

interested in providing service at Cape Yakataga and Icy Bay, Alaska with or without subsidy, 

for a new contract period beginning November 1, 2012. Carriers should file their proposals 

no later than August 7, 2012. Staff will then docket the proposals, thereby making them 

public, and direct each carrier to serve a copy of its proposal on the civic parties and other 

applicants. Shortly afterwards, we will provide a summary of the proposals to the 
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communities and ask them to submit their final comments. We will give full consideration to 

all proposals that are timely filed. I 

' 

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

proposals will represent their final and only proposals. However, 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 andre-solicit a new round of 

proposals. However, negotiation and rejection are 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, they might want to include proposed 

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

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

facilitate their evaluation by the affected communities and the Department.2 . 

With specific respect to Cape Yakataga and Icy Bay, we expect proposals consisting of service 

with small aircraft (e.g., those with 3-5 seats) and offering each community three round trips a 

week during the peak season and two weekly round trips during the off-peak season to 

Yakutat or any other suitable hub, such as Cordova. In that regard, our understanding is that 

weather conditions have typically allowed for a higher percentage of completed flights to 

Yakutat, so we encourage carriers to give consideration to providing service to Yakutat, at 

least as one option. Further, flights meeting EAS guidelines at Alaskan communities should 

provide sufficient capacity to accommodate passenger, freight and mail demand. Such service 

is generally consistent with what the communities currently receive, and fully satisfies their 

EAS requirements. We encourage proposals that meet those requirements in an efficient 

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

they need not limit themselves to those requirements if they envision other, potentially more 

attractive service possibilities (e.g. different hubs or length of contract) with subsidy 

requirements that remain competitive. 

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

EAS without subsidy and we determine that service 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 in Alaska, 49 U.S. C. §41733(c)(1) directs us to consider five 

factors: (1) scheduled service reliability; (2) contractual and marketing arrangements with a larger carrier to 

ensure service beyond the hub; (3) interline arrangements that the applicant has made with a larger carrier at the 

hub; (4) community views, giving substantial weight to the views of the elected officials representing the users; 

and ( 5) the experience of the applicant in providing, in Alaska, scheduled air service. In addition, the 

Consolidated and Further Continuing Appropriations Act, 2012, Public Law 112-55, provides that when selecting 

a carrier to provide EAS, the Department may consider the relative subsidy requirements of the carriers, 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. 
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New Filing Procedures 

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

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

http://www.regulations.gov/, each page should be formatted to be viewed online and for easy 

printing. 

Service and Traffic History 

Alsek has served Cape Yakataga and Icy Bay since fall 2006. In order to assist carriers in 

making their traffic and revenue projections, we have included historical traffic data, as 

provided by Alsek in Appendix B. As is typically the case in Alaska, significantly more 

freight and mail flow from the hub to the EAS communities than from the EAS communities 

to the hub. In addition, the data show that there is some seasonal peaking of traffic. Proposals 

should accommodate both of these factors. 

Other Carrier Requirements 

The Department is responsible for implementing various Federal statutes governing Jobbying 

activities, drug-free workplaces, and nondiscrimination.3 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 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, 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 requirements should contact the Office of Aviation Analysis at (202) 366-

5903.4 

Community and State Comments 

The communities and State are welcome to submit comments at any time. We encourage 

prospective applicants to contact the communities before they submit their proposals so that 

they can tailor them to the communities' needs, as theywill not be able to amend them after 

the due date. As noted earlier, we will provide a copy of the proposals to the civic parties and 

ask them to submit their final comments shortly after August 7, the due date for proposals. 

This Order is issued under authority delegated in 49 CFR 1.56a(f) andre-delegated to the 

Director, Office of Aviation Analysis. 

3 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 (non-procurement) and government-wide requirements for drugfree workplace (grants). 

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

1. We request that carriers interested in provi~ing EAS at Cape Yakataga and Icy Bay, 

Alaska, submit their proposals, with or without subsidy requests, no later than August 1, 2012. 

The proposals should be e-mailed to:- EAS@dot.gov with the title "Proposal to Provide 

Essential Air Service at Cape Yakataga and Icy Bay, Docket DOT -OST -1996-2009";5 

2. This docket will remain open until further order of the Department; and 

3. We will serve copies of this Order on the parties listed in Appendix D. 

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

Regulations, 14 CFR 385.30, 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). 

TODD M. HOMAN 

Director 

Office of Aviation Analysis 

An electronic version of this document is available 

on the World Wide Web at http://www.regualtions.gov 

5 Questions regarding filings in response to this Order may be directed to A.J. Muldoon at (202) 366-1058 or 

albert.muldoon@dot.gov. Proposals should also be e-mailed to albert.muldoon@dot.gov and 

dennis.devany@dot.gov. 
Appendix A 

SERVICE AREA MAP 

Icy Bay 

ALASKA 
Appendix B 

Aviation activity at Cape Yakataga and Icy Bay, Alaska 

MonthNear · Passengers Mail (lbs.) Freight (lbs.) 

November, 2006 8 20 300 

December, 2006 2 0 0 

January, 2007 0 29 1133 

February, 2007 0 22 405 

March, 2007 11 70 3072 

April, 2007 18 249 3400 

May, 2007 35 233 3747 

June,2007 29 103 4920 

July, 2007 32 320 4234 

August, 2007 26 254 2346 

September, 2007 20 62 1099 

October, 2007 16 117 857 

November, 2007 3 115 442 

December, 2007 2 60 1165 

January, 2008 4 25 434 

February, 2008 3 11 450 . 

March, 2008 1 60 959 

November, 2008 19 90 2264 

December, 2008 3 1403 1071 

January,2009 4 3 417 

February, 2009 2 7 76 

March, 2009 5 915 48 

April, 2009 9 173 180 

May, 2009 32 266 2413 

June,2009 15 587 796 

July, 2009 8 1918 1067 

August, 2009 25 518 1018 

September, 2009 45 1273 4635 

October, 2009 12 263 2608 

November, 2009 3 140 355 

December, 2009 0 145 155 

January,2010 2 245 36 

February,2010 4 667 803 
Appendix D 

MonthNear Passengers Mail (lbs.) Freight (lbs.) 

March, 2010 4 95 1276 

April, 2010 9 152 2514 

May,2010 46 389 6043 

June,2010 6 217 705 

July, 2010 2 0 1515 

August, 2010 16 0 500 

September, 2010 16 5 98 

October, 2010 22 0 1457 

November, 2010 0 20 467 

December, 2010 0 0 165 

January, 2011 10 195 2700 

February, 2011 0 102 1608 

March, 2011 4 343 272 

April, 2011 6 259 2300 

May, 2011 12 10 262 

June, 2011 37 263 254 

July, 2011 19 74 2838 

August, 2011 12 37 206 

September, 2011 17 88 3093 

October, 2011 12 26 378 

November, 2011 4 505 255 

December, 2011 0 65 88 

January, 2012 2 246 378 

February, 2012 0 403 432 

March, 2012 1 279 590 

April, 2012 3 145 225 

Source: Alsek Air Service, Inc. 
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 servi'ce 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 order beyond [DATE]. The 

Department's obligation for performance under this order beyond [DATE], is subject to 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 Department will provide 

notice in writing to the carrier. 

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

under this order. · 
Appendix D 

SERVICE LIST 

40-Mile Air, LeifWilson 

40-Mile Air, Vanessa Thompson 

Aero Twin, AACA, Tony Cestnik 

Air Excursions, Marion Broughton 

Air Excursions, Mike Loverink 

Alaska Air Carriers Association, Joy 

Journeay 

Alaska Airlines, Jeff Munro 

Alaska Airlines, Joe Sprague 

Alaska Airlines, Sandy Sinick 

Alaska Airlines, Torque Zubeck 

Alaska Central Express, John Seamon 

. Alaska Central Express, Mike Bergt 

Alaska Central Express, Steve Deaton 

Alaska Central Express, Steve Endlich 

Alaska DOT, Linda Bustamante 

Alaska DOT, Rebecca Cronkhite 

Alaska DOT, Steven D. Hatter 

Alaska DOT-Medicaid Passenger Fares 

Alaska Seaplane, Kent Craford 

Alsek Air, Les and Debra Hartley 

Arctic Circle, Donald Singsaas 

Arctic Transportation Services, Wilfred 

Ryan 

Arctic Transportation Services, Jim Hjelm 

Bering Air, David Olsen 

Bering Air, Jim Rowe 

Sen. Begich, James Feldman 

Sen. Begich, Schawna Thomas 

Sen. Murkowski, Jeremy Price 

Sen. Murkowski, Karen McCarthy 

Sen. Murkowski, Warren Wright 

Consultant, Hank Myers 

Consultant, Ken Acton 

Consultant, Norm Israelson 

Copper Valley Air, Dave Parmenter 

Copper Valley Air, Todd Hand 

Dora to Jets, Mark McKenna 

DOT, Richard Sewell 

ERA Aviation, Lori Goodman 

· Era Aviation, Walter Dallis 

Frontier Flying, Paul Hendrickson 

Frontier/ERA/Hageland, Bob Hajducovich 

·Grant Aviation, Bruce McGlasson 

Hageland, Mike Hageland 

Hageland, Patrick Thurston 

Harris Air, Fly Hackett 

Harris Air, Scott Harris 

Homeland Security, David Bernier 

Homeland Security, Michael Duffy 

Homeland Security, Ragan, William 

Homer Air, Andy Smircich 

Iliamna Air, Tim LaPorte 

Inland Aviation, Stephen Hill 

Island Air, Bob Stanford 

Island Air, Jennifer Stanford 

Katmai Air, Sonny Peterson 

LAB Flying Service, Eric Bennett 

Larry's Flying, Jean Chenaille 

North~rn Air Cargo, Dave Squier 

Northern Air Cargo, David Karp 

Northern Air Cargo, Eric Van Andel 

Pacific Airways, Steve Montanus 

PenAir, Danny Seybert 

PenAir, Kim Kawaguchi 

PenAir, Patrick Rizzi 

PenAir, Scott Bloomquist 

ProMech, Mark Sessoms 

Seaport, EAS Mailbox 

Seaport, Rob McKinney 

Servant Air, Terry Cratty 

Servant Air, Wes Osowski 

Smokey Bay Air, Claire McCann 

Spernak Airways, Mike Spernak 

Tanana Air Service, Brian Martin 

Taquan Air Service, Brien Salazaar 

Taquan Air Service, Beckie Allen 

Tatonduk, Tina P~ylor 

Tatonduk, Robert Everts 

Tatonduk, Robert Ragar 

USDOT, Dennis DeVany 

USDOT, Jennifer Thibodeau 

USDOT, Kevin Schlemmer 

·USDOT, Richard Leonard 

USPS, Greg Garcia 

USPS, Joseph Anzalone 

USPS, Joy Doby 

USPS, Kevin Hartner 
USPS, Leonard Kilburn 

USPS, Mary Taylor 

Ward Air, Ed Kiesel 

Ward Air, Tom Williams 

Appendix D 

Wings Airline Services, Bob Jacobsen 

Wings Airline Services, Holly Johnson 

Wright Air Service, Bob Bursiel 

Yute Air, Tim Vottis