Grant Aviation, Inc P.o. Box 92200 Anchorage, AK 99509 Proposal to Provide EAS atClarks Point, Alaska Docket DOT -OST -2015-0058 EAS & Domestic Analysis Division Office of Aviation Analysis U.S. Department

of Transportation 400 7th StreetS.W., Room 6401 Washington, D.C

.20590 May 18, 201S Dear Sirs, Enclosed, find Grant Aviation, Inc.'s proposal to provide Essential Air Service between Dillingham, Alaska and Clarks Point, Alaska for the period June 1S, 2015 through June 14, 2017. While our currently filed scheduled service provides three direct non-stop flights weekly between Clarks Point and Dillingham, the community has adamantly and persistently requested greater frequency
of service, complaining that three round trips perweek does not provide them with adequate accessto health care facilities, pharmaceuticals, educational opportunities, perishable commodities, commercially available manufactured goods, and general commerce. In responseto the need of the people of Clarks Point, Grant Aviation has, for many years,been operating six flights per week, sothat travelers from Clarks Point maytravel to Dillingham for medical appointments

,shopping, and educational events without the need to overnight

in Dillingham

.Providing six round trips weekly also permits travelers to catch
a flight from Dillingham
to Anchorage without overnighting

in Dillingham. We have attempted
to provide for their travel needs, but areunable to continue our provision of an adequate frequency
of safe, reliable service without subsidy. Anchorage

is the only fully developed population center in our state, to which the citizens of remote communities must travel to have accessto state of the art medical treatment, higher education, and significant commercial opportunities. Further, organizations providing economic and political support for remote Native Alaskan villages are primarily headquartered

in Anchorage. Without reasonable accessto these organizations, the isolated communities have no voice in legislative action having dramatic impact upontheir communities. In accord with the Department's request for proposals, Grant Aviation here proposesfour alternate plans for providing Essential Air Service to Clarks Point. The first provides for aminimal level of service of three direct nonstop round trips weekly between Clarks Point and Dillingham, with alternate plans providing either four, five, or,aswehave been conducting without subsidy, six direct, nonstop flights perweek as required to provide this isolated community with adequate transportation service. The primary aircraft types to be utilized for the proposed service areeither
aCessna C-207 or Gipps Aero GA-8, carrying six orseven passengers respectively. Both plane types are single engine, capable of providing transportation

in VFR conditions under Part 13S. This proposal provides for passenger transport
aswell as handling and interim storage of mail and freight between Dillingham and the village of Clarks Point.The brief summary table below states the total expected annual economic cost, total expected market derived revenue, and total resulting annual subsidy required to perform at the rate of 100% for each proposed option. Summary of Four Options to Provide EAS between Clarks Point and Dillingham Number of Weekly Total Annual Total Annual Revenue Total Annual RoundTrips Economic Cost Derived from Market Required Subsidy 3 $204,117

.68 $92,882.00 $111,235.68 4 $270,750.7S $92,882.00 $177,868.75 s $337,383.82 $92,882.00 $244,S01.82 6 $404,016.89 $92,883.00 $311,133.89 Detailed cost sheets follow for each of the above proposed frequencies. We look forward to working with you in providing transportation service to the people of Clarks Point. If you require further information,

I may be contacted by phone at 907 529-6999,
or by e-mail at bmcglasson@flygrant.com. **?~A'~** R. Bruce McGlasson CEO Grant Aviation, Inc.Grant Aviation, Inc. Clarks Point EAS Proposal Summaryw/ C-207 orGA-8 Option - 3 Round Trips Weekly Weekly Round Trips Annual RT Flights @ 100% completion Per RT Block Time (Hours) Annual Block Hours OW Distance DLG- Clarks Point Airport (stat miles) Annual OIW Passengers expected OW fare Annual maillbs expected Current mail rate

I lb Annual Freight lbs expected Current Freight rates

I lb Expected Revenue Derived from Operations

$ $ $

3 156 0.45 70

.20 15 810 96.74 19,000 0

.5454 8,000 0.52 Passenger Fares

$ Annual Revenue 78,359.40 10,362.60 4,160.00 Mail Revenue

$ Freight Revenue

$ Total Annual Revenue from Scheduled Operations

$ 92,882.00 Expected Direct Expense of Operations Fuel

-LL100 Aviation Gasoline Aircraft lease expense Maintenance (engine&prop +labor+parts) Pilot labor, inclusive of tax and benefits Aviation Insurance annual hull and liability Expected Indirect Expense of Operations Hanger lease & rampacservices Ticketing

& ground service Total Annual Direct Expense Freight
& mail Handling DLG, Clarks Point Pilot housing+utility Sum of Direct and Indirect Expense Add Burden @ 24% subtotal Add Profit@ 5.0% Total Annual Indirect Expense Annual Direct Exp. $ 8,950.50 $ 33,171.43 $ 11,653.20 $ 50,839.29 $ 5,892.86 $ 110,507.27 Annual Indirect Exp. $ 15,428.57 $ 12,168.00 $ 3,240.00 $ 15,428.57 $ $ $ $ 46,265.14 156,772.41 37,625.38 194,397.79 9,719.89 Total Annual Economic Cost
$ 204,117.68 Less Annual Revenue Derived from Scheduled Operations

$ 92,882

.00 Annual Subsidy Required

$ 111,235.68Grant Aviation, Inc. Clarks PointEAS Proposal Summaryw/ C-207 orGA-8 Option - 4Round Trips Weekly Weekly Round Trips AnnualRT Flights @100% completion PerRTBlock Time (Hours) Annual Block Hours OW Distance DLG -Clarks Point Airport (stat miles) Annual OIW Passengers expected OW fare Annual maillbs expected Current mailrate

I lb Annual Freightlbs expected Current Freight rates

I lb Expected Revenue Derived from Operations

$ $ $

4 208 0.45 93.60 15 810 96

.74 19,000 0

.5454 8,000 0

.52 Passenger Fares

$ Annual Revenue 78,359

.40 10,362

.60 4,160

.00 Mail Revenue

$ Freight Revenue

$ Total Annual Revenue from Scheduled Operations

$ 92,882.00 Expected Direct Expense of Operations Fuel

-LL100 Aviation Gasoline Aircraft lease expense Maintenance (engine&prop +labor+parts) Pilot labor, inclusive oftaxand benefits Aviation Insurance annual hulland liability Expected Indirect Expense of Operations Hanger lease& rampacservices Ticketing

& ground service Total Annual Direct Expense Freight
& mall Handling DLG, Clarks Point Pilot housing+utility Sum of Directand Indirect Expense Add Burden
@24% subtotal AddProfit @5.0% Total Annual Indirect Expense Annual Direct Exp

. $ 11,934

.00 $ 44,228

.57 $ 15,537

.60 $ 67,785

.71 $ 7,857

.14 $ 147,343.03 Annual Indirect Exp. $ 20,571.43 $ 16,224

.00 $ 3,240

.00 $ 20,571.43 $ $ $ $ 60,606.86 207,949.89 49,907.97 257,857.86 12,892.89 Total Annual Economic Cost
$ 270,750.75 Less Annual Revenue Derived from Scheduled Operations

$ 92,882.00 Annual Subsidy Required

$ 177,868.75Grant Aviation, Inc. Clarks Point EAS Proposal Summaryw/ C-207 orGA-8 Option - 5 Round Trips Weekly Weekly Round Trips Annual RT Flights @ 100% completion Per RT Block Time (Hours) Annual Block Hours OW Distance DLG- Clarks Point Airport (stat miles) Annual OIW Passengers expected OW fare Annual maillbs expected Current mail rate

I lb Annual Freight lbs expected Current Freight rates

I lb Expected Revenue Derived from Operations

$ $ $

5 260 0.45 117.00 15 810 96.74 19,000 0.5454 8,000 0.52 PassengerFares

$ Annual Revenue 78,359.40 10,362.60 4,160.00 Mail Revenue

$ Freight Revenue

$ Total Annual Revenue from Scheduled Operations

$ 92,882.00 Expected Direct Expense of Operations Fuel

-lllOO Aviation Gasoline Aircraft lease expense Maintenance (engine&prop +labor+parts) Pilot labor, inclusive of tax and benefits Aviation Insurance annual hull and liability Expected Indirect Expense of Operations Hanger lease & rampacservices Ticketing

& ground service Total Annual Direct Expense Freight
& mail Handling DLG, Clarks Point Pilot housing+utility Sum of Direct and Indirect Expense Add Burden
@ 24% subtotal Add Profit @ 5.0% Total Annual Indirect Expense Annual Direct Exp. $ 14,917.50 $ 55,285.71 $ 19,422.00 $ 84,732.14 $ 9,821.43 $ 184,178.79 Annual Indirect Exp. $ 25,714.29 $ 20,280

.00 $ 3,240.00 $ 25,714.29 $ $ $ $ 74,948.57 259,127.36 62,190.57 321,317.92 16,065.90 Total Annual Economic Cost
$ 337,383.82 Less Annual Revenue Derived from Scheduled Operations

$ 92,882.00 Annual Subsidy Required

$ 244,501.82Grant Aviation, Inc. Clarks PointEAS Proposal Summaryw/ C-207 orGA-8 Option - 6Round Trips Weekly Weekly Round Trips AnnualRT Flights@ 100% completion PerRTBlock Time (Hours) Annual Block Hours OW Distance DLG

-Clarks Point Airport (stat miles) AnnualOIW Passengers expected OW fare Annual maillbs expected Current mailrate

I lb Annual Freightlbs expected Current Freight rates

I lb Expected Revenue Derived from Operations

6 312 0.45 140

.40 15 810 $ 96.74 19,000 $ 0.5454 8,000 $ 0.52 Passenger Fares

$ Annual Revenue 78,359

.40 10,362.60 4,160

.00 Mail Revenue

$ Freight Revenue

$ Total Annual Revenue from Scheduled Operations

$ 92,882.00 Expected Direct Expense of Operations Fuei-LL100 Aviation Gasoline Aircraft lease expense Maintenance (engine&prop +labor+parts) Pilot labor, inclusive oftaxand benefits Aviation Insurance annual hulland liability Expected Indirect Expense of Operations Hanger lease& rampacservices Ticketing

& ground service Total Annual Direct Expense Freight
&mail Handling DLG, Clarks Point Pilot housing+utility Sum of Directand Indirect Expense Add Burden subtotal AddProfit @5.0% Total Annual Indirect Expense Annual Direct Exp. $ 17,901

.00 $ 66,342

.86 $
23

,306

.40 $ 101

,678

.57 $ 11,785.71 $ 221,014.54 Annual Indirect Exp. $ 30,857.14 $ 24,336

.00 $ 3,240

.00 $ 30,857.14 $ $ $ $ 89,290.29 310,304

.83 74,473

.16 384,777.99 19,238.90 Total Annual Economic Cost
$ 404,016.89 Less Annual Revenue Derived from Scheduled Operations

$ 92,882.00 Annual Subsidy Required

$ 311,134.89