# O Memorandu m

U. 1 Departmen t o f - . . _; . j Transportatio n Offic e o t th e Secrerar

y o f Transportatio n 

### Subject ; Weekl y compensatio n ceilin g payou t clarificatio n a

t Gran dDate " ^^^ y ^^ ' ^^ ^ ^ Island , Nebrask a(Docke t DOT-OST-2002-13983 ) From , Denni s J . DeVan y Repl y t o Kevi n Schlemmer

, X-5 3 EA S an dDomesti c Analysis , X-5 3 Att n of : ^''' ' ^""^ ^ To : Greg Frazier , S-3. 6 Reference : Orde r

2011-1-2 5 Weekl y Ceilin g Payou t

clarificatio n I n Order2011-l-25 , Januar y 31 , 2011 , th e Departmen t selecte dAmerica n Eagl e Airline s t o provid e essentia l ai r

servic e (EAS ) a

t Gran dIsland , Nebraska , for tw o year s a

t a n annual subsid y rat e o f $2,215,582
. America n Eagl e inaugurate dservic e a t Gran dIslan do n Jun e 9 , 2011 , thu s it s rat e wil l expir e o n Jun e 30 , 2013 . Unde r that rate , th e carrie r

provide s 1 3 weekl y nonsto p roun d trip s t o Dallas/Fort

WorthInternationa l Airport o n 37 , 44 , o r

5 0 passenge r

Embrae r regiona l je t aircraft . Whe n calculatin g th e weekl y compensatio n ceiling , ther e wa s atypographica l erro r i n Appendi x C o f

Orde r 2011-1-25 . Th e correc t

weekl y ceilin g compensatio n shoul db e 543,472 , rathe r tha n $43,372 , a s state di n that Order . Attache di s th e pag e showin g th e revise dcalculations . I f you hav e an y questions , pleas e cal l Kevi n Schlemme r a t (202 ) 366-3176 . cc : America n Eagl e Airline s

### Appendi x C Pag e 1 of 2 America n Eagl e Airline s Essentia l Ai r

Servic e t o b e Provide da t Gran dIsland , Nebrask a Effectiv e Period : Tw o year s beginnin g whe n America n Eagl e inaugurate s servic e (o n o r afte r Ma y 1 , 2011) , throug hth e en do f th e 24'* * monththereafte r Schedule dService : 1 3 weekl y roun dtrip s t o Dallas/Fort WorthInternationa l Airport Intermediat e stop s an duplin e service : Service mus t b e nonsto p Aircraft : Embrae r

13 5 (3 7 seats) ; Embrae r 14 0 (4 4 seats) ; o r

Embrae r 14 5 (5 0 seats ) Rat e pe r Eligibl e Flight : $1.672 ' Weekl y Ceiling : $43,472 ^ Note : Th e carrie r

understand s tha

t it ma y forfei t it s compensatio n fo

r any flights tha

t i t doe s no t operat e i n conformanc e wit

hth e term s an dstipulation s o f th e rat e order , includin g th e servic e plan s outline di n th e orde r

an d any othe r significan t

element s o f

th e require dservice , withou t prio r approval . Th e carrie r

understand s tha

t a n aircraf t take-of f an dlandin g a

t it s schedule ddestinatio n constitute s acomplete dflight; absen t a n explanatio n supportin g subsid y eligibilit y fo r aflight tha t ha s no t bee n completed , suc h a s certai n weathe r cancellations , onl y complete dflights ar e considere deligibl e fo r subsidy . I

n addition , i

f th e carrie r

doe s no t schedul e o r

operat e it s flights i n ful l conformanc e wit

hth e orde r

fo r asignifican t

period , i t ma y jeopardiz e it s entir e subsid y clai mfo r th e perio di n question . I

f th e carrie r

contemplate s an y suc hchange s beyon dth e scop e o f th e orde r durin g th e applicabl e perio do f

thes e rates , i

t mus t firs t notif y th e Offic e o f

Aviatio n Analysi s i

n writin g an dreceiv e writte n approva l fromth e Departmen t t o b e ensure do f

ful l compensation . Shoul dcircumstance s warrant , th e Departmen t ma y locat e an dselec t

areplacemen t

carrie r t o provid e servic e o n thes e routes . Th e carrie r mus t complet e al l flights tha t can b e safel y operated ; flights that overfl y point s fo

r lac k o f traffi c wil l not

b e compensated . I

n determinin g whethe r

subsid y paymen t

fo r adeviatin g flight

shoul db e adjuste dor

disallowed , th e Departmen t wil l conside r th e exten t

t o whic hth e goal s o f

th e progra mare me t

an dth e exten t

o f acces s t o th e nationa l air transportatio n syste mprovide dt o th e community . I f th e Departmen t

unilaterally , eithe r

partiall y or

completely , terminate s o r reduce s payment s fo

r servic e o r change s servic e requirement s a t aspecifi c locatio n provide dfo r unde r thi s order , then , a

t th e en do f

th e perio dfo

r whic hth e Departmen t

doe s make payment s i

n th e stipulate damount s or a t th e stipulate dservic e leveLs . th e carrie r ma y ceas e t o provid e servic e t o that specifi c locatio n withou t regar dt o an y requiremen t

fo r notic e o f suc h cessation . Thos e adjustment s i n th e level s o f

subsid y and/o r

servic e tha

t are mutuall y agree dt o i

n writin g b y th e Departmen t

an dcarrie r

d o no t constitut e atotal or

partia l reductio n o r

cessatio n o f

payment . Subsid y contract s ar e subjec t to , an dincorporat e b y reference , relevan t statute s an dDepartmen t regulations , a s the y ma y b e amende dfromtim e t o time . However , any suc hstatutes , regulations , o r amendment s theret o shal l not operat e t o controvert

th e foregoin g paragraph . Fund s are not

currentl y availabl e fo

r performanc e unde r

thi s orde r

beyon dMarc h 3 , 2011 . Th e Government' s obligatio n for

performanc e unde r

Ihi. s orde r

beyon dMarc h 3 , 2011 , i s subjec t r o th e availabilit y o f

appropriate d fund s fro mwhic hpaymen t fo r service s can b e made . N o legal liability o n th e par t o f th e Governmen t

fo r any paymen t ma y aris e fo r performanc e unde r

thi s orde r

beyon dMarc h 3 , 2011 , unti l fund s ar e mad e availabl e t o th e Departmen t

fo r performance . I

f fund s ar e no t

mad e availabl e fo

r performanc e beyon dMarc h 3 . 2011 , the Departmen t

wil l provid e notic e i

n writin g t

o th e carrier . Al l claim s fo

r paymen t mus t b e submitte dwithi n 6 0 day s o f th e las t day o f servic e provide dunder

thi s order .

' Annual compensatio n o f $2,215,582
. divide db

y 1,325 annual departure s (2 6 flights pe r week x 5 2 week s plu s 4) X 9 8 percen t

completion) . ' 2 6 flights pe r

week multiplie db y $ 1,67 2 pe r flight.