### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

ESTABLISHME NT OF SLOT EXEMPTION PROCEEDING

P URSUANT TO 49 U.S.C. § 41718(b)

Docket OST

- 2000

- 7182

NOTICE

Summary

By this notice, the U.S. Department o f Transportation (the Department) requests applications from air carriers using Stage 3 aircraft for two slot exemptions for service to Ronald Reagan Washington National Airport (DCA) from airports that were designated

as me dium hub, small hub, or nonhub a irpor ts in 1997 within the 1,250

- mile perimeter established for civil air carrier operations at DCA under Title 49 U.S.C. § 49109. Completed applications must be filed in Docket DOT

- OST

- 2000

- 7182 by March 25

, 2014, and comments with respect to any timely filed request for slot exemptions must be filed by April 1 , 2014.

Background

The Wendell H. Ford Aviation Invest ment and Reform Act for the 21 st Century, as amended by the Vision 100 Century of Aviation Reauthorization Act of 2003, directs the Department to grant slot exemptions at DCA, both within and beyond the airport’s 1,250

- mile perimeter. These grants are limited in number, and selections of air carriers are made through application of specified statutory criteria. See 49 U.S.C. § 41718.

By Ord er 2012

- 3

- 8 (DOT March 13, 2012) , the Department issued two within

- perimeter slot exemptions to Republic Airline Inc. (Republic) pursuant to 49 U.S.C. § 41718(b) to provide nonstop service between DCA and Kansas City International Airport ( MCI )

. Republic provided the service under the brand of its then

- affiliate Frontier Airlines. On January 24, 2014, Republic informed the Department by letter that, due to the sale of Frontier, the service between DCA and MCI would be discontinued effective February 1,

20 14 , and the slot exemptions returned for reallocation.

After receipt of the notice from Republic , the Department granted a request from

Southwest Airlines for pendente lite authority to operate nonstop service between DCA

and MCI using the two within

- pe rimeter slot exemptions authorized by 49 U.S.C. § 41718(b) and previously issued to Republic from February 1, 2014 until such time as a

final se lection decision is made in this reallocation proceeding and the selected carrier

initiates service

. As we stat ed in our Order Confirming Grant of Temporary Slot Exemption Authority

, Order 2014

- 1

- 6 (DOT January 27, 2014) , a grant of pendente lite Ser ved: March 5 , 2014- 2

-

authority is one of temporary character and is intended to minimize any inconvenience to

travelers and to ensure that th e slot exemptions are not idled pending the Department’s decision on longer term authority. Ou r grant to Southwest of temporary authority to operate the slot exemptions between DCA and MCI will not give the carrier any benefit or advantage in the Departm ent’s application of the stat utorily

- mandated criteria in this reallocation proceeding. All applications will receive full and fair comparative consideration of their merits under 49 U.S.C. § 41718(b).

Proceeding

Accordingly, t he Department requests a pplications from air carriers using Stage 3 aircraft for the two slot exemptions previou s ly issued to Republic

. Applicants must propose to provide service to DCA from airports that were designated as medium hub, small hub

, or nonhub airports in 1997 1 with in the 1,250

- mile perimeter established for civil air carrier operations at DCA under Title 49 U.S.C. § 49109.

The selection criteria applicable to grant ing slot exemptions are found in Title 49 U.S.C. § 41718(b), which directs the Secretary to distribu te within

- perimeter slot exemptions in a manner that promotes air transportation: (1) by new entrant air carriers and limited

incumbent air carriers ; 2 (2) to communities without existing nonstop air transportation to DCA; (3) to small communities; (4) that will provide competitive nonstop air transportation on a monopoly nonstop route to DCA; or (5) that will produce the maximum competitive benefits, including low fares. A s we recently explained in Order Reallocating Within

- Perimeter Slot Exemptions at Ron ald Reagan Washington National Airport , Order 2012

- 7

- 26 (DOT July 24, 2012), the Department has the discretion to premise an award of within

- perimeter slot exemptions on the satisfaction of less than the greatest number of criteria, or even one criterion, listed in Section 41718(b), based upon the Department’s analysis of the relative merits of each carrier’s proposal when evaluated

under the se criteria

. We also stated that the Department would apply this interpretation of the statute in all future proceed ings under Section 41718(b).

With respect to airport size, Title 49 U.S.C. § 41718(c)(3) specifies additional requirements governing the grant of within

- perimeter slot exemptions, requiring that “[o]f the exemptions granted under 49 U.S.C. § 41718: (A) without regard to the criteria contained in subsection (b)(1), six shall be for air transportation to small hub airports and nonhub airports; (B) ten shall be for air transportation to medium hub and smaller airports; and (C) four shall be for air transpor tation to airports without regard to their

size.” Under this provision, then, a maximum of four slot exemptions may be used to serve large hubs. Currently, a ll large hub opportunities have been allocated , as have the six exemptions specifically for small and nonhub airports. Therefore, to be responsive to

1 49 U.S.C. § 41714(h)(7), (8) and (9) require that hub classifications be based on the Federal Aviation Administration’s Primary Airport Enplanement Activity Summary for Calendar Year 1997.

2 A new entrant carrier or limited incumbent carrier is an air carrier that holds or operates fewer than 40 slots at DCA. See 49 U.S.C. § 41714(h)(3), (5), as amended by the FAA Modernization and Reform Act of 2012, Pub. L. No. 112

- 95, 126 Stat. 11 (Feb. 14, 2012).- 3

-

this request and eligible for award, carriers must propose service with Stage 3 aircraft to a

medium hub or s maller airport within the 1,250

- mile perimeter.

At a minimum, carriers should include in th eir applications the market to be served, the aircraft type, a schedule showing proposed times, an approximate start

- up date , and an analysis of the relative merits of the carrier’s proposed service when evaluated under the Section 41718(b) criteria

. Comp leted applications must be filed in Docket DOT

- OST

2000

- 7182 by March 2 5 , 2014 , and comments with respect to any timely filed request for slot exemptions must be filed by April 1 , 2014

.

T he Department further note s that the previously

- allocated slot times for the DCA

- MCI

service are in the 1100 and 1400 hour periods. Section 41718(c)(2) prohibits the Department from assign ing more than five slot exemptions per one hour period. Some time periods a re fully subscribed, and, thus, the Department may not be a ble to accommodate carrier requests for alt ernative slot exemption times.

We will serve a copy of this notice on all certificated air carriers, the Metropolitan Washington Airports Authority, and the Federal Aviation Administration ’s Slot

Administration o ffice.

By:

Susan L. Kurland

Assistant Secretary for Aviation

and International Affairs

(SEAL) An electronic version of this document will be available on the World Wide Web at: http://dms.dot. gov/