# August 2, 2011 Sponsor: McClellan

- Palomar Airport , Carlsbad, California Peter Drinkwater, Director of County Airports, County of San Diego Congressional Code: CA

- 0 50
Dun & Bradstreet Number: 1870326770000 Tax Identification Number (EIN): 95

- 6000934 

## Application for Federal Support for New Air Service via:
Revenue Guarantees Advertising/Marketing Program 

## In Support of Non

- Stop Service on California Pacific Airlines to Various Destinations 

# McCLELLAN

- PALOMAR AIRPORT , CARLSBAD, CA Proposal Under the Small Community Air Service Development Program Docket DOT

- OST

- 2011

- 0119McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 2 TABLE OF CONTENTS

Introductory Letters of Support 3 Summary Information

– Appendix C 5
Introduction 8
The Carlsbad/North San Diego County Air Service Market 10
Current and Historical Service 12 Air Service Development Efforts 18
Air Service Needs and Deficiencies 19 Strategic Plan for New Air Service 23 Proposed New Route s 23 Implementation Timeline 38
Alternate Plan 39
Public/ Private Partnership 40 Funding Plan 43
Performance Measures and Financial Controls 45 Legal Sponsor 46
Letter s of Support 47 Availability of Alternate Airports 57 Airport Information 58 Community Profile 59 Comparison to Other Communities in Region 66
Conclusions 70



## Section Page NumberMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 3 INTRODUCTORY LETTERS OF SUPPORTMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 4McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 5 SUMMARY INFORMATION

– APPENDIX C

Small Community Air Service Development Program
Docket DOT

- OST

- 2011

- 0119



## A. Applicant Information

Not a Consortium Community now receives EAS subsidy
Interstate Consortium Intrastate Consortium Community previously received a Small Community Grant If previous recipient, date of Grant: __________________

______________ expiration date of G rant: _______________________



## B. Public/Private Partnership

Public:

1. County of San Diego
2. McClellan

- Palomar Airport

Private:

1. California Pacific Airlines
2. Carlsbad Chamber of Commerce 3. San Diego North Convention and Visitors Bureau
4. San Diego North Chamber of Commerce
5. San Diego North County Economic Development Council
6. Palomar Airport AssociationMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 6 C. Project Proposal

Marketing Upgrade Aircraft New Route
Travel Bank Service Restoration Subsidy Surface Transportation Regional Service Revenue Guarantee
Launch New Carrier Start

- Up Cost Offset First Service Study Secure Additional Service 

### Other (Specify)



## D. Existing Landing Aids at Airport

Full ILS Outer/Middle Marker Published Instrument Approach
Localizer Other: GPS Approach



## E. Project Cost

1. Federal amount requested: $ 1,0 00,000
2. State cash financial contribution: $ 0
Local cash financial contribution:
3a. Airport cash funds: $ 0
3b. Non

- Airport cash funds: $ 300 ,000
3. Total local cash funds: $ 30 0,000
4. TOTAL CASH FUNDING: $ 1,30 0,000
In

- Kind Contribution:

a. Airport In

- Kind contribution: $ Various
b. Other In

- Kind contribution: $ Various
5. TOTAL IN

- KIND CONTRIBUTION: $ Undetermined
6. TOTAL PROJECT COST: $ 1,30 0,000 + In

- Kind



## F. In

- Kind Contributions

For funds in lines 7a (airport in

- kind contribution) and 7b (other in

- kind contribution), please describe the source(s) of fund(s) for each. Advertising and marketing match money ( airport and media companies)McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 7 G. Is Application Subject to Review by State Under Executive Order 12372 Process?

This application was made available to the State on ______. Program is subject to review, but has not been selected b y the State. Program is not covered.



## H. Is Applicant Delinquent on any Federal Debt?

NoMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 8 INTRODUCTION

T

he McClellan

- Palomar Airport in Carlsbad is one of the most underserved airports in the country when the size of its primary catchment area is taken into account. The Airport is the closest access point to air service for 1.1 million people in north San Diego County. And yet, the Airport is served by just one carrier, with turboprop aircraft, to one hub

- Los Angeles

– with just 150 departing seats per day on average

.

Capacity continues to be cut in Carlsbad, with total available seats down 22% in the last three
years

– a loss of an average of 43 departing seats per day. The situation is little better at the nearest “big airport”

– San Diego International. Airlines at San Diego have cut seats by a similar
22%

- or an average of 7,800 departing seats per day

– since the summer of 200 8. As seats have been cut, fares have been going up. The average roundtrip fare at the McClellan

- Palomar Airport has gone up by $40 roundtrip, or 14%, in just the last
year.

The effect of seat cuts and rising fares has been
increase d passenger leakage f rom the Carlsbad catchment area to other airports in the region. The Airport recently commissioned a leakage study to quantify passenger leakage. The study found just 1.6% of total passengers generated in
the area closest to the McClellan

- Palomar Airport , actually use the Airport. The catchment area leaks an average of 4,400 passengers per day each way to other airports, clogging already congested southern California freeways and increasing the carbon footprint of travelers throughout the region.

In ord er to address these challenges, the Airport has teamed up with a new airline

– California
Pacific Airlines

– on a range of non

- stop jet service to be provided at the McClellan

- Palomar Airport beginning in the early second quarter of 2012. Daily non

- stop s ervice will be provided, under this proposal, to Oakland, San Jose, Sacramento, Las Vegas, and Phoenix on new Embraer ERJ170 jets. California Pacific Airlines is so committed to the service, it has located its headquarters just a few miles from the Airpor t, and it has committed the cash match for this Grant proposal. California Pacific has pledged $300,000 in cash for marketing and advertising under this proposal

– 23% of the total project cost of $1.3 million

. 

# “California Pacific has pledged $300,000 in cash for marketing and

advertising under this proposal

–

23% of the total project cost.”McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 9 In addition to the benefits of new airline service to five non

- stop destinations, this application will also help support a start

- up airline that seeks to compete along the West Coast . The value of a new airline to a community cannot be understated

– especially in a time where consolidation reigns. The US has lost four major carriers in the last several years: Northwest, Continental, AirTran,
and Midwest. California Pacific Airlines is one of the few start

- ups that has the financial backing to start flying. In order to be successful
, however, it will require support from the McClellan

- Palomar Airport

– its main base of operations.

Unlike most other proposals, this Grant pro ject will
also lead to the creation of several hundreds of new jobs in Carlsbad. With its headquarters near the Airport, CP Air plans to have a little over 100 employees working full

- time in Carlsbad at service launch, in the second quarter of 2012. This number is projected to grow to 500 employees by the fifth year of service.

The McClellan

- Palomar Airport SCASD Program project is ready to go. The Airline is the cash partner in the application and is committed to launching service. An agreement can be made with the carrier as soon as the Grant is awarded. And this Grant will do much more than simply link a community to a new hub. It will help to launch a new airline and support a new base of operations in the very small community the Grant is designe d to help. 

# “...this Grant will do much more than simp ly link a community to a new hub. It will help launch a
new airline...”McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 10 THE CARLSBAD/NORTH SAN DIEGO COUNTY AIR SERVICE MARKET Current and Historical Air Service

T

he McClellan

- Palomar Airport in Carlsbad, California
, serves one of the largest catchment areas, in terms of population, of all non

- hub airports in the country. More than 1.1 million people
live closer to the McClellan

- Palomar Airport than any other airport. Yet the Airport has just five departing flights per day, all on 30

- seat turboprop aircraft, with only 150 daily outbound seats. Moreover, available seats in the market have been cut by 22% in the last two years.

The Carlsbad catchment area , seen in orange in map 1, is home to 1,146,522 people as of the
latest US Census estimates. The Carlsbad area comprises 12.3% of the overall population of the
entire shaded area

– the

area that includes San Diego, Carlsbad, Orange County, and Long Beach.
The total population of
the shaded area is 9.3
million , making it one of the most populous one

hour catchment ar eas of any airport in the country. Despite comprising 12% of the region’s population, most of
Carlsbad catchment area passengers fly from other airports in the region , largely due to the
breadth of service
offered at those other airports. Catchment Area Population Share of Pop. Carlsbad/McClellan-Palomar Airport 1,146,522 12.3% Santa Ana-Orange County/John Wayne Airport 2,635,931 28.3% Long Beach/Daugherty Field 3,621,575 38.9% San Diego Lindbergh International 1,902,720 20.4% Total of Region 9,306,748 100.0% 

## MAP 1 : The McClellan

- Palomar Airport Catchment Area Relative to the Catchments of Other Southern California AirportsMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 11 Non-Stop Departures Seats Departures Seats Capacity Carrier Destination Per Day Per Day Per Day Per Day Change
United LAX 5.6 167 6.5 195 16.8%
United Total 5.6 167 6.5 195 16.8%
Carlsbad Total 5.6 167 6.5 195 16.8% Aug-10 Aug-11 

### Despite the relative
size of the Carlsbad catchment area, the Airport has much less
service than other
California markets
home to more th an a mil lion people. As of August of 2011 , the
McClellan

- Palomar Airport had service to just one non

- stop
destination

– LAX (see figure 1 ). The Airport will see a slight year

- over

- year increase in available August 2010 to August 2011, with SkyWest adding another daily LAX frequency, and boosting capacity to 195 departing seats per day on average. Nonetheless, Carlsbad airline capacity is down more than 20% since the summer of 2008.

The McClellan

- Palomar Airport has seen dramatic pa ssenger declines in the last three years,
after a near record 2006 . That doesn’t mean the market is shrinking, and demand for air service is declining. The reality is, with seat cuts and flight frequency reductions at the McClellan

Palomar Airport, more and mor e Carlsbad area passengers are being forced to use other airports in the region to access the nat ional air transportation system

– a theory that is proven by the Airport’s recent leakage study, which will be detailed in this application.

In 2006 the McCle llan

- Palomar Airport saw an average of 180 passengers per day each way at an average fare of $156 each way (see figure 2). The number of passengers using the Airport dropped to just 74 passengers per day each way on average in 2009

– a loss of 106 passengers per day each way , or 59 % of passengers

. The market did experience a slight rebound in 2010, adding an average of four passengers per day each way , to bring the average to almost 78
pa ssengers per day each way

. 

## FIGURE 1 : Scheduled Service at the McClellan

- Palomar Airport, August 2010 vs. August 2011; Source: Airline Schedule DataMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 12 Passengers increased in Carlsbad in 2010 despite the fact that average fares rose to their highest point in six years, at $165 each way (see figure 2). Between 2009 and 2010, the average one way fare at the McClellan

- Palomar Airport went up by $20

– an increase of 14%

- outpacing the national and regional averages for fare growth.

To go along with th ese relatively high average fares, the Carlsbad market has been dealing with the continuing loss of available airline seats. Since the summer of 2008 the McClellan

- Palomar Airport has gone from an average of 6.5 daily departures to an average of 5.1 daily departures. This has resulted in a loss of 21% of daily flights (see figure 3).

While flights in Carlsbad are down 21 %, available seats are down 22% since the summer of 2008, or by an average of 43 departing seats per day (see figure 3). At the same ti me, passengers using the McClellan

- Palomar Airport have increased. In summer of 2008, an average of 98 passengers per day each way used the airport. That number was up to as many as 107



## FIGURE 2 : O&D Passengers and Average One Way Fares at McClellan

- Palomar Airport, 2001

– 2010; Source: US DOT Table OD1A

124,450

99,590 90,320 84,680 78,760 120,450 114,580

63,570

47,000 50,090 7,170

6,440

5,730 6,620 5,500 10,880 10,950

10,090

6,820 6,510 180.3

145.2

131.6 125.1
115.4 179.9 172.0

100.9

73.7 77.5

0 20,000 40,000 60,000 80,000 100,000 120,000 140,000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 PDEW Int'l Pax Domestic Pax

$175 $169 $173 $186 $179

$156
$139 $159 $145 $165McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 13 passengers per day each way during the fall of 2010

– an increase of 9% in total onboard
passengers.

Many markets can tell the same story about higher than average fares and decreased airline capacity . But the story in Carlsbad is punctuated by the fact that the flight reductions have drastically increased the region’s passenger “leakage” to other airports in southern California.
This is a more critical situation in southern California than in almost any other part of the country, due to the heavy congestion on virtually all freeways in and out of Carlsbad, at virtually all times of day. The McClellan

- Palomar Airport must do a better job serving its local 1.13 million population by attracting additional air service and keeping travelers off the freeways

.

In preparation for its application for Grant funding, the McClellan

- Palomar Airport commissioned a True Market/Leakage study, so that it could better understand its local air travel market before requesting federal funding for additional flights. The study results show that the Airport retains just 1.6% of the passengers generated by its local, immediate catchment area. 

## FIGURE 3 : Average Daily Departures, Daily Available Seats, Daily Onboard Passengers July 2008

– December 2010; Source: US DOT T100 Data

195 189
179 179

165 169 172 180 183 186

172 190 182 184 177 177 175

156 155 161 164

134

87 94 129 165 156 150 153 152

98 95 86 85
73 73
61 67 67 75

62 64 71 63 64 70 68 59 58 67 76

63

31 34 64 83 99 106 107 105

0 50 100 150 200

Available SDEW Onboard PDEW Flights DEW 6.5 6.3 6.0 6.0 5.5 5.6 5.7 6.0 6.1 6.2 5.7 6.3 6.1 6.1 5.9 5.9 5.8 5.2 5.2 5.4 5.5

4.5

2.9 3.1 4.3 5.5 5.2 5.0 5.1 5.1McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 14 Most of those “lost” passengers found their way to service at other airports in the region, such as San Diego International and John Wayne Airport in Orange County. The majority of Carlsbad area passengers
, in fact, currently fly out of the San Diego airport at Lindbergh Field. As of the year ended first quarter 2010, according to the Airport’s recently commissioned True Market/Leakage Study, the McCl ellan

Palomar Airport’s catchment area generated 2,485,803 total passengers who flew out of San Diego , or an average of 3,405 passengers per day each way (see
f igure 4 ).

The Airport’s catchment area generated an additional 518,394 passengers , or 710
pa ssengers per day each way, who flew out of Los Angeles International (LAX); 184,677
passengers , or 253 passengers per day each way, who flew out of John Wayne Airport in Orange County; 59,393 passengers , or 81 passengers per day each way who flew out of On tario; and 6,403 passengers , or nine passengers per day each way, who flew out of Long Beach (see figure 4 ) . Only 53,520 Carlsbad

- area passengers , or 73 passengers per day each way, actually
flew out of the McClellan

- Palomar Airport as of the year ended first quarter 2010

– or 1.6% of the catchment area’s total passengers. In other words, Carlsbad leaks 98.4% of its origin and destination passengers to other airports in southern California. That leakage represents an average of 4,407 passengers per day each way.

It will be an uphill battle for a new airline in the market to re

- capture these “leaked” passengers. Passenger behavior is often ingrained and travel habits can be difficult to break. That is why it is essential the Airport offer risk mitigation and marketing support to a new carrier

– to make sure the new carrier has a sufficient “ramp up” phase to win back passengers to the McClellan

Palomar Airport. 

## FIGURE 4 : Carlsbad Area O&D Passengers by Airport Used YE1Q10; Source: Sixel Consulting Group True Market Study

San Diego, CA 75.3% Los Angeles, CA 15.7% Orange County, CA 5.6% Ontario, CA 1.8% Carlsbad, CA 1.6% Airport Passengers PDEW Share

1 SAN San Diego, CA 2,485,803 3,405.2 76.0% 2 LAX Los Angeles, CA 518,394 710.1 15.8% 3 SNA Orange County, CA 184,677 253.0 5.6% 4 ONT Ontario, CA 59,393 81.4 1.8% 5 CLD Carlsbad, CA 53,520 73.3 1.6% 6 LGB Long Beach, CA 6,403 8.8 0.2%
Total Carlsbad Area Passengers 3,270,633 4,480 100.0% 

### Originating Airport For Carlsbad Area Passengers

Tw elve Months Ended March 2010

Rank True Market with LCC AdjustmentMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 15 The McClellan

- Palomar Airport’s top 20 origin and destination passenger markets are spread throughout the country, with somewhat of an emphasis on west coast
travel. The market’s number one O& D destination is the San Francisco Bay Area, with an average of almost six passengers per day each way (see figure 5 ). Other large western markets include Los Angeles, with an average of nearly 5 passengers per day each way; Las Vegas, with an average
of 2.8 passengers per day each way; Seattle/Tacoma, with an average of 2.7 passengers per day each way; and Sacramento, with an average of 1.5 passengers per day each way. It must be noted that these figure do not include any of the passengers leaking to ot her airports
from the Carlsbad catchment area

– they only include actual travel from McClellan

- Palomar Airport, itself, as of calendar year 2010.

As noted, the average one way
fare at the McClellan

- Palomar Airport in 2010 was $165 (see figure
6

). This average does a poor job of taking into account the actual
available fares in the market at most
times. Due to the fact that there are
far fewer available seats at
McClellan

- Palomar Airport than at other airports in the region, the lower
fare buckets at McClellan

- Palomar Airport tend to sell out much more quickly than at San Diego or LAX. 

## FIGURE 5 : Carlsbad’s Top 20 O&D Passenger Markets CY2010; Source: US DOT Table OD1A

FIGURE 6 : Average One Way Fares at Top 20 CLD O&D Passenger Markets CY2010; Source: US DOT Table OD1A 4,260 3,350 3,210 2,730 2,080 1,980 1,960 1,900 1,540 1,440 1,300 1,280 1,060 1,030
990
980
980
880
840
800 5.8
4.6
4.4
3.7
2.8
2.7
2.7
2.6
2.1
2.0
1.8
1.8
1.5
1.4
1.4
1.3
1.3
1.2
1.2
1.1

0 500 1,000 1,500 2,000 2,500 3,000 3,500 4,000 4,500 San Francisco, CA

Los Angeles, CA Washington, DC Denver, CO Las Vegas, NV Seattle/Tacoma, WA Honolulu, HI Chicago, IL New York/Newark, NY Boston, MA Orlando/Sanford, FL Portland, OR Sacramento, CA Kahului, HI Philadelphia Phoenix/Mesa, AZ San Jose, CA Salinas/Monterey, CA Fresno, CA Colorado Springs, CO Annual Passengers PDEW

$87 $58 $187 $106 $77 $137 $172 $146 $199 $165 $132 $120 $89 $147 $159 $83

$97 $43 $100 $123

$0 $20 $40 $60 $80 $100 $120 $140 $160 $180 $200 San Francisco, CA

Los Angeles, CA Washington, DC Denver, CO Las Vegas, NV Seattle/Tacoma, WA Honolulu, HI Chicago, IL New York/Newark, NY Boston, MA Orlando/Sanford, FL Portland, OR Sacramento, CA Kahului, HI Philadelphia Phoenix/Mesa, AZ San Jose, CA Salinas/Monterey, CA Fresno, CA Colorado Springs, CO 

### Average One Way Fare : $ 165McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 16 This phenomenon is best documented by researching the lowest available fare to specific destinations from the three airports in question: McClellan

- Palomar, San Diego International, and Los Angeles International. To a ll of the Carlsbad market’s largest nearby origin and destination passenger markets, the lowest available fare in August of 2011 from McClellan

- Palomar Airport is significantly higher than the average fare from either San Diego or LAX (see figure 7 ).

The lowest available August 2011 fare
between McClellan

Palomar Airport and Oakland was $432, according to ExpertFlyer.com (see figure 7 ). The Carlsbad
fare to Oakland was
140 % higher, or $ 252 more, than the $180 fare from either LAX or San Diego. In the Sacramento market, the $278 fare from Carlsbad was
64 % higher than the $170 fare from LAX, and 89 % higher than the $147 fare from San Diego. Similarly, the lowest available fare from the McCl ellan

- Palomar Airport to San Jose was $269, while the lowest LAX fare was $159 and the lowest available San Diego fare was $147. All fares
noted here are round trip but do not include taxes and fees. Fare disparities to Phoenix and Las Vegas were smaller , but still apparent. The effect of the disparities in the lowest available fare from the three airports is that the McClellan

- Palomar Airport loses passengers to both other airports, as they work to take advantage of much better travel pricing. This unn ecessarily clogs southern California freeways, and increases the region’s already large carbon footprint.

Higher fares often arise from a lack of competition. There is no current airline competition at the
McClellan

- Palomar Airport. But w hile United Expr ess/SkyWest has a 100% market share of both passengers and revenue at the McClellan

- Palomar Airport, United does not rank as the top airline for Carlsbad catchment area passengers when all catchment area passengers, traveling from all airports, are taken i nto account . It is important in markets such as Carlsbad to analyze 

## FIGURE 7 : Lowest Available Fares in Select Markets August 2011; Source: ExpertFlyer.com

$432

$278 $269 $197 $178 $180 $147 $147 $119 $140 $180 $170 $159 $135 $86

$0 $50 $100 $150 $200 $250 $300 $350 $400 $450

Oakland Sacramento San Jose Phoenix Las Vegas Carlsbad San Diego Los Angeles (LAX)McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 17 not just the market share at the local Airport, but the market share including those passengers who “leak” to other airports in the region.

The Airport’s recently completed True Market/Leakage Study shows that most Carlsbad catchment area passengers use
Southwest Airlines

– not United service provided directly at th e Airport, itself (see Figure 8 ). These Southwest passengers are “leaking,” primarily, to San Diego and Los Angeles International (LAX). Despite the
fact that Southwest does not serve Carlsbad, it captures almost a third of all Carlsbad catchment area p assengers at other airports in southern California. United ranks as the market’s second largest carrier, with 14% of the total market, while
American ranks third with 12.5% of the market’s origin and destination passengers. Somewhat surprisingly, low cos t carriers not named Southwest draw just a combined 6.6% of Carlsbad area passengers, which suggests fare is not the major consideration in choosing which airline and airport to use.

The McClellan

- Palomar Airport is an underused facility in one of t he most heavily populat ed areas of the world. There is tremendous potential for success in the market for the right kind of airline, offering non

- stop service to the most in

- demand destinations. However, it has been difficult to convince airlines of the potential due to the diff icult metrics of current service, including declining passengers and declining capacity. 

## FIGURE 8 : Carlsbad’s True Airline Passenger Share YE1Q10; Source: Sixel Consulting Group True Market Study

Southwest

34.4%

United 14.8% American

13.2% Delta (+Northwest) 10.7% US Airways 6.9% Continental 6.7% Alaska 6.2% jetBlue 2.8% Virgin America 2.2% Frontier 2.0% Airline Passengers PDEW Share

1 Southw est 1,062,528 1,455.5 32.5% 2 United 456,948 626.0 14.0% 3 American 408,645 559.8 12.5% 4 Delta (+Northw est) 331,287 453.8 10.1% 5 US Airw ays 213,731 292.8 6.5% 6 Continental 206,610 283.0 6.3% 7 Alaska 191,451 262.3 5.9% 8 jetBlue 86,228 118.1 2.6% 9 Virgin America 67,919 93.0 2.1% 10 Frontier 62,240 85.3 1.9%

Total of Above 3,087,587 4,230 94.4% Total Carlsbad Area Passengers 3,270,633 4,480 100.0% Tw elve Months Ended March 2010

Rank 

### Top Airlines For Carlsbad Area PassengersMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 18 AIR SERVICE DEVELOPMENT EFFORTS

For the last several years, the McClellan

- Palomar Airport has been working to retain, expand,
and attract new airline service at the Airport. It realizes it must work to recruit additional service, so it can better serve its catchment area of 1.13 million people. As part of this effort, i n 2010, the
McClellan

- Palomar Airport commissioned a True Market/Leakage Study, using its own funding, so it could better understand the travel patterns of local catchment area residents. The results of
this S tudy were completed for inclusion in this Gra nt application. The Study shows a local market for almost 3.3 million annual passengers.

The Airport also hired an air service development consulting firm to aid in the preparation of specific airline case studies, and to facilitate direct airline

one

- on

- one meetings. Within the last
year, the Airport hosted officials from
both Horizon Air an d California Pacific Airlines for meetings on field. Additionally, the Airport has met with
airlines such as Frontier and Cape Air to discuss new service opportunities.

These meetings have led to a more fully

- developed partnership with a locally headquar tered new airline, California Pacific Airlines. California Pacific is the cash partner in this project, putting up $300,000 of its own cash funding as the match to the federal portion of the project. Very few Small Community Air Service Development Grant projects have airlines contributing direct cash funding. The fact that Carlsbad has an airline partner with money in the project makes this application much more likely to be successful in the long term. 

## FIGURE 9 : McClellan

- Palomar True Market Study YE1Q10; Source: Sixel Consulting GroupMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 19 AIR SERVICE NEEDS AND DEFICIENCIES

The region served by Carlsbad’s McClellan

- Palomar Airport has a number of air service deficiencies, most of which would be best remedied by additional non

- stop destinations in its markets of most demand. Among the deficiencies are the lack of available seats, declining capacity, and fares that are not competitive with other airports in the region.

Additionally, the area around McClellan

- Palomar Airport has the highest concentration of major employers in all of San Diego County

– a higher concentration than even downtown San Diego, where San Diego International Airport is
located. 19 of San Diego County’s top 35 employers, in te rms of total employees in the region, are located
within seven miles of
McClellan

- Palomar Airport (see figure 10 ). Another eight companies are
located within 14 miles of the Airport. A total of 28 of the 35 largest companies in San Diego County are
loc ated closer to
McClellan

- Palomar Airport than San Diego International Airport. This business travel demand would be better met at McClellan

- Palomar Airport

– but that will take non

- stop service to the specific points of demand for those businesses,
which includes the Bay Area, Phoenix and Las Vegas.

It has been documented in this application that the McClellan

- Palomar Airport’s limited service, which includes flights only to LAX, is a deterrent to the County’s large businesses using the 

## FIGURE 10 : Location of San Diego County’s Top Employers Summer 2011; Source: California Pacific AirlinesMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 2 0 Airport. While those businesses are located much closer to McClellan

- Palomar Airport than San Diego, San Diego is still able to capture 76% of total Carlsbad catchment area demand, as noted in the Airport’s recent True Market/Leakage Study. In fact, the McClellan

- Palomar Airport captures less than 5% of its catchment area passengers to all 25 of its top true passenger markets as of the year ended first quarter 2010 (see map 2).

Among the Carlsbad catchment area’s largest origin and destination passenger markets are the cities of the Bay Area, Phoenix, and Las Vegas. In each of these markets, the McClellan

Palomar Airport retains less than 3% of total passenger demand, with San Diego capturing more than 75% of all passengers (see map 2). In these markets, John Wayne Airport in Santa Ana/Orange County captures almost 16% of Carlsbad catchment area passengers, while LAX captures the rema ining 6% of passengers.



## MAP 2 : Airport Share of Carlsbad Catchment Area Passengers YE1Q10; Source: Sixel Consulting Group True Market StudyMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 21 This extensive passenger leakage from the Carlsbad catchment area puts a large burden on the already saturated freeway system of southern California. The region is known for its traffic
bottlenecks. The more than three million ai rline passengers who leak out of the Carlsbad catchment area to other airports in the region put an undue burden on other modes of transportation. These passengers could be much better served by the McClellan

- Palomar Airport. Moreover, it would likely sa ve the Department of Transportation further funding for the southern California roadway system should it support further development of the McClellan

Palomar Airport.

There are two key reasons behind Carlsbad’s “leakage” to other airports in southern California.
One: a lack of sufficient available seats in the market to allow local travelers to use their l ocal airport. And two: airfares that are much higher than those found at competing airports. Average fares in Carlsbad aren’t accurately reported, as SkyWest does not report fare
informatio n to the DOT as part of Table OD 1A. As SkyWest operates Carlsbad service “at risk,” average fares reported by the DOT in the Carlsbad are arbitrarily assigned by stage length. Due to these fare reporting issues, a simple comparison of average fares in the
Carlsbad market is not accurate.

There is no question that the Carlsbad catchment area is not only affected by air
service offered at the McClellan

- Palomar Airport, but also by the service offered at San Diego International. It is important to analyze service changes in San Diego to unde rstand the overall deficiencies in service in the region.

At the same time the McClellan

- Palomar Airport sees airline service declines, San Diego’s Lindbergh International Airport has see n its most significant seat cuts in two decades . Since the

summer o f 2008, San Diego has lost an average of 74 daily departures

– a loss of 26 % of that Airport’s daily flights (see figure 11 ). During that same time period, Sa n Diego has lost an average of 7,818 daily outbound available seats, or 22 % of the market’s available airline capacity.

These flight and seat losses not only hurt the immediate San Diego catchment area, but also Carlsbad. As Carlsbad has seen its flights and seats cut even more drastically over the last two 

# “... extensive passenger leakage from the Carlsbad catchment area puts a large burden o n the already saturated freeway system of southern California.”McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 22 years, Carlsbad area travelers have had to rely more on service provided at San Diego for access to the national air transportation system. This access is becoming more difficult as the region, as a whole, sees huge cuts in airline service. Together, Carlsbad and San Diego have lost

an av erage of almost 8,000 daily departing seats since the summer of 2008

– almost a quarter of

all the region’s airline capacity. Airlines have not lined up to fill that capacity at San Diego. The
McClellan

- Palomar Airport believes now is the time to shift t he travel patterns of the region, and
to enhance service in north San Diego County.

There are many more needs and deficiencies in air service in the Carlsbad catchment area. These additional deficiencies will be highlighted in the section of this report dedicated to explaining the strategic plan for new service for McClellan

- Palomar Airp ort

.



## FIGURE 11 : Available Seats, Passengers, and Departures per Day Each Way San Diego International Airport; CY2010; Source: US DOT T100

35,433 34,474

30,793 30,695 30,313 29,261 28,771 29,228 29,511 29,567 30,403 32,062 32,301 31,517

29,144 28,963 28,236 27,902 26,639 27,049 27,993 28,583 29,602 31,032 30,953 30,423

28,222 28,436 27,458 27,110 26,686 26,716 27,615 28,029 27,817

22,544 23,472 21,891 21,647
19,699 21,471 22,720 23,936 23,212 25,825 27,291 26,227

22,570 23,540 22,448 21,924
20,174 20,675 22,729 23,117 22,698 25,617 26,438 25,879

22,642 23,414 22,710 22,125
20,453 21,011 22,449

10,000 15,000 20,000 25,000 30,000 35,000 40,000

Available SDEW Onboard PDEW Flights DEW 286.2 276.7

241.1 239.6 233.6 227.0 225.0 228.9 230.7 232.5 236.4 247.6 249.0 243.8

225.4 223.5 217.7 215.8 205.8 211.0 218.2 221.9 228.9 236.8 234.7 230.4

213.1 213.5 208.0 205.5 204.4 205.2 212.1McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 23 STRATEGIC PLAN FOR NEW AIR SERVICE

McClellan

- Palomar Airport has developed a partnership with California Pacific Airlines (CP Air) in support of this strategic plan for additional air service in north San Diego County. CP Air is providing the local matching cash for this plan

– one of the very few Small Community Air Service Development plans for new air service that is being supported by direct airline cash. This plan is aimed to address the extensive passeng er leakage from the Carlsbad catchment area, to add available airline seats to the market, to add non

- stop service to the Carlsbad catchment area’s largest origin and destination markets, and to bring down airfares throughout the region.

Uniquely, this strategic plan also includes the support of a newly launched air carrier. Federal support for this plan translates to federal support for a new competing carrier , California Pacific Airlines, offering service along the West Coast . There is tremendous value to this added competition, not only in Carlsbad and north San Diego County, but also in the proposed cities served under this plan.

This strategic plan does not include simple service through a new hub. It is predicated upon the launch of California Pacific Airlines in Carlsbad,
itself

– with a number of routes

non

- stop from the McClellan

Palomar Airport to destinations of top demand for catchment area passengers. In this case, the goals of the Airport and
the Airline are 100% in line with
each other.

This plan would include new,

non

- stop service on California
Pacific Airlines from the McClellan

- Palomar Airport to five of the Airport ’s top eight origin and
destination passenger markets (see map 3). These markets include Oakland, ranked number 

## MAP 3 : Proposed Routes

- Carlsbad to Oakland, Las Vegas, Sacramento, Phoenix and San JoseMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 24 two; Las Vegas, ranked number five; Sacramento, ranked number six; Phoenix, ranked number seven; and San Jose ranked number eight.

C alif ornia Pacific Airlines has been in existence for three years. Its planning process is nearly complete, as is the process to gain certification from the FAA. The Airline expects to have certification materially complete in the fall of 2011. The timeline for new service under this plan is the beginning of second quarter of 2012, which would be much faster action on a new Grant award than most other applications that have been approved in the past. CP Air has the financial backing to take delivery of the E mbraer ERJ170 aircraft it has on order, and to begin
service on this timeline.

Both the Airport and C alif ornia Pacific Airlines independently identified the same markets as priorities for new service to and from Carlsbad. The Airport’s own True Market/Leakage Study verifies the viability of the routes initially chosen by CP Air for non

- stop service. Oakland is the top potential route, with an average of 204 passengers per day each way to and from the Carlsbad catchment area (see figure 12 ). As of the year ended first quarter 2010, just five of those 204 passengers per day each way used the McClellan

- Palom ar Airport , with 76% using San Diego.

Carlsbad

– Las Vegas ranks as the second potential route, with an average of 185 passengers per day each way as of the year ended first quarter 2010, with just 2.5 % of those passengers using the McClellan

- Palomar Airp ort (see figure 12 ). Sacramento ranks third, with an average of
171 passengers per day each way, with 76 % of those passengers using the San Diego
International Airport

. Phoenix ranks fourth, with an average of 158 passengers per day each way, with 76 % of those passengers using the San Diego International Airport . And, finally, San Jose ranks as the fifth best opportunity in the Carlsbad market, with an average of 156 passengers per day each way, with just 2.5 % of those passengers using the local Airp ort

. 

## FIGURE 12 : Airport Share to Proposed Destinations under This Plan YE1Q10; Source: Sixel Consulting Group True Market Study

Total Rank Airport Paxs PDEW Paxs PDEW Paxs PDEW Paxs PDEW Passengers

1 Oakland, CA 113,413 155.4 8,426 11.5 23,651 32.4 3,730 5.1 149,220 2 Las Vegas, NV 102,711 140.7 7,631 10.5 21,420 29.3 3,378 4.6 135,140 3 Sacramento, CA 94,932 130.0 7,053 9.7 19,797 27.1 3,122 4.3 124,905 4 Phoenix, AZ 87,602 120.0 6,508 8.9 18,269 25.0 2,881 3.9 115,260 5 San Jose, CA 86,701 118.8 6,441 8.8 18,081 24.8 2,852 3.9 114,075
Total Carlsbad Area Passengers 485,359 76.0% 36,059 5.6% 101,218 15.8% 15,964 2.5% 638,599 San Diego, CA Los Angeles, CA Carlsbad, CA (+Others) Orange County, CAMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 25 In all, the five identified markets that would gain service under this proposal generate an average of 875 passengers per day each way in the Carlsbad catchment area as of the year ended first quarter 2010 (see figure 12 ). Of those passengers, 76% currently fly from the San Diego International Airport, with 16% flying from Orange County, and 6% flying from Los Angeles International. Less than 3% of those passengers currently use the McClellan

- Palomar Airport . CP Air gi ves the Airport the best possible chance at recapturing these passengers.

The Airport feels that C alif ornia Pacific Airlines should not be required to undertake this project
alone. The addition of five new non

- stop routes, a new start

- up carrier, and the Airport’s first jet service in years will be a tremendous boost to the Carlsbad region as a whole. For these reasons, the McClellan

- Palomar Airport is seeking Small Community Air Service Development
Grant support for the project.

C alif ornia Pacific Airlines has committed $300,000 in direct cash to this strategic plan. The
McClellan

- Palomar Airp ort is seeking a Small Community Air Service Development Grant in the amount of $1 million as the federal share of the project. The CP Air portion of funding represents 23% of the total project cost, which is $1.3 million. Of that total project cost, $800,000 will be used in support of marketing and advertising of the new service at the
McClellan

- Palomar Airport. The remaining $500,000 will be used as a revenue guarantee in support of the five new routes CP Air
will offer from McClellan

- Palomar Airport.

The goal of the marketing and advertising campaign will be t o convert Carlsbad catchment area passengers from users of the San Diego International Airport to user s of the McClellan

Palomar Airport. This campaign will focus on north San Diego County. The goal of the revenue guarantee will be to cover any losses CP Air faces in the first year of new service from the
McClellan

- Palomar Airport.

Due to the latent demand for air travel in the Carlsbad catchment area, it is estimated new service will be immediately profitable in the summer season. The revenue guarantee would 

# “The addition of five new routes, a new
start

- up carrier, and the Airport’s first jet service in years would be a tremendous boost to the Carlsbad region...”McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 26 likely cover losses in the first winter season. The reasons for the belief that service will be quickly profitable are included in the route by route analysis that follows.



## Route Specific Data: Carlsbad

– Oakland

The number one route proposed und er this strategic plan, in terms of passengers generated in the Carlsbad catchment area, is McClellan

- Palomar Airport

– Oakland. In determining the potential for Oakland service to be successful
, it’s important to look at both current capacity to the Bay Area from the greater San Diego region and current traffic from the same region.

Capacity between the San Diego area and the Bay Area has been cut by a quarter since the summer of 2008, with no major additions of service anticipated in the near term. In July of 2008,
airlines offered an average of 53 departures a day in each direction between San Diego International Airport and the Bay Area airports of Oakland, San Jose, and San Francisco (see figure 13 ). By March of 2011, the number of daily departures had fallen to 38, a loss of 29% of all daily flights, or an average of 15 flights per day each way.



## FIGURE 13 : Average Daily Departures, Daily Available Seats, and Daily Onboard Passengers SAN

– OAK+SJC+SFO; July 2008

– March 2011; Source: US DOT T100 Data

6,749 6,564 6,342 6,345 6,391 6,260 6,207 6,186 6,292 6,223 6,127 6,275 6,268 6,007 5,572 5,574 5,514 5,511 5,375 5,498 5,603 5,741 5,633 5,707 5,621 5,575 5,300 5,310 5,379 5,173 5,163 5,210 5,068 4,688 4,780
4,197 4,356 4,066 4,053
3,503 3,979 4,159 4,476 4,261 4,529 4,613 4,487 4,164 4,268 4,247 4,166
3,654 3,741 4,062 4,180 4,047 4,409 4,373 4,452 4,236 4,313 4,343 4,040
3,530 3,808 3,798

0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 8,000

Available SDEW Onboard PDEW Flights DEW 53.0 51.4 49.7 49.5 49.2 48.4 47.9 48.0 49.0 49.1 48.2 49.3 49.4 46.7

40.4 40.5 40.6 40.4 39.1 40.4 41.3 41.8 40.9 41.8 41.0 40.4 37.9 38.0 38.5 37.1 37.3 38.1 37.9McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 27 At the same time, available seats in the San Diego

– Bay Area market have tumbled. In July of 2008, airlines offered an average of 6,749 seats per day each way (see figure 13 ). By Ma rch of 2011 that number had fallen to 5,068 seats per day each way

– a loss of 25% of all seats, or 1,681 seats per day each way.

Capacity has been cut similarly between San Diego and Oakland, itself. In July of 2008, airlines offered an average of 15 departures a day in each direction between San Diego International Airport and Oakland International (see figure 14 ). By March of 2011, the number of daily departures had fallen to 11, a loss of 27% of all daily flights, or an average of four flights per day each way.

Available seats in the San Diego

– Oakland market have fallen in much the same way. In July of 2008, airlines offered an average of 2,086 seats per day each way (see figure 14 ). By March of
2011 that number had fal len to 1,527 seats per day each way

– a loss of 27% of all seats, or 559 seats per day each way.

Assuming California Pacific Airlines operates four flights per day in each direction between Carlsbad and Oakland, those flights would offer an average of 264 seats per day each way on
CP Air’s 66

- seat Embraer E MB 170 aircraft. The seats would only replace 47% of the Oakland 

## FIGURE 14 : Average Daily Departures, Daily Available Seats, and Daily Onboard Passengers SAN

- OAK; July 2008

– March 2011; Source: US DOT T100 Data

2,086 2,015 2,010 2,000 2,021 1,946
1,769 1,708 1,784 1,807 1,751 1,787 1,774 1,649 1,530 1,537 1,543 1,524 1,590 1,647 1,675 1,694 1,635 1,695 1,654 1,608 1,530 1,550 1,497 1,482 1,455 1,531 1,527 1,378 1,387

1,167 1,228 1,180 1,149

954 1,094 1,116 1,242 1,109 1,219 1,227 1,195 1,075 1,114 1,121 1,109 967 1,021 1,144 1,179 1,115 1,269 1,206 1,216 1,144 1,177 1,123 1,123
977 1,078 1,116

0 500 1,000 1,500 2,000 2,500

Available SDEW Onboard PDEW Flights DEW 15.3 14.8 14.7 14.6 14.8 14.2
12.9 12.5 13.1 13.3 12.8 13.1 13.1 12.1 11.2 11.3 11.4 11.3 11.7 12.1 12.3 12.5 12.0 12.5 12.2 11.8 11.3 11.4 11.0 10.9 10.7 11.3 11.2McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 28 seats that have been removed from the larger San Diego market. Even with CP Air’s entrance into the market, it is likely the market will still be underserved, and demand for seats will still exceed capacity.

The passenger demand between the San Diego area and Oakland has fal len in the last four years as capacity has been cut and fares have risen. In 2007 the San Diego/Carlsbad

– Oakland route generated 1,418 passengers per day each way on average (see figure 15 ). In 2010 the average number of passengers per day each way traveling between the Carlsbad area and Oakland dropped to just 888

– a loss of 37% of local passengers, or 528 passengers per day each way.

While the largest reason for the decline in passengers between the Carlsbad area and Oakland
is the decline in ava ilable seats

– down 27% since 2008

– another factor has been rising fares. The average one way fare between the Carlsbad area and Oakland in 2007 was $78 (see figure
15 ). The average fare has risen 17% since then, to $91 each way in 2010.

Oakland is a large, local market with capacity that has been squeezed in the last several years. California Pacific Airlines would merely be replacing a small portion of the capacity that has been lost, giving the Airport confidence the route will perform well. 

## FIGURE 15 : O&D Passengers and Average One Way Fares, SAN+CLD

– OAK 2001

– 2010; Source: US DOT Table OD1A

886,390 991,310 983,750 1,038,700 1,049,460 1,076,370 1,035,060

808,280
655,910 648,360 1,214.2 1,358.0 1,347.6 1,422.9 1,437.6 1,474.5 1,417.9

1,107.2

898.5 888.2

0 200,000 400,000 600,000 800,000 1,000,000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 PDEW Total Passengers

$71 $67 $73 $74 $80 $86

$78 $83 $83 $91McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 29 Rout e Specific Data: Carlsbad

– Las Vegas

The San Diego

– Las Vegas route has seen similar cuts to the San Diego

– Oakland route. In January of 2009, airlines offered an average of 17 departures a day in each direction between San Diego International Airport and McCarran International in Las Vegas (see figure 16 ). By March of 2011, the number of daily departures had fallen to 11.5 , a loss of 32% of all daily flights, or an average of five flights per day each way.

Available seats in the San Diego

– Las Vegas market have fallen in much the same way. In January of 2009, airlines offered an average of 2,234 seats per day each way (see figure 16 ). By
March of 2011
, that number had fallen to 1,571 seats per day each way

– a loss of 30% of all seats, or 663 seats per day each way.

Assuming California Pacific Airlines operates two flights per day in each direction between Carlsbad and Las Vegas, those flights would offer an average of 132 seats per day each way on
CP Air’s Embraer EMB 170 aircraft. The seats would only replace 20% of the Las Vegas seats that have been removed from the larger San Diego market.

The passenger demand between the San Diego area and Las Vegas has fallen in the last four
years as capac ity has been cut and fares have gone up by $20 each way. In 2007 the San 

## FIGURE 16 : Average Daily Departures, Daily Available Seats, and Daily Onboard Passengers SAN

- LAS; July 2008

– March 2011; Source: US DOT T100 Data

2,126 2,152 2,234 2,236 2,235 2,082 2,202 2,234
2,043 2,000 1,973 1,959 1,977 1,974 1,937 1,804 1,781 1,776

1,542 1,575 1,587 1,594 1,547 1,575 1,557 1,562 1,556 1,549 1,503 1,475 1,554 1,572 1,571 1,489 1,554 1,384 1,381 1,333 1,379 1,302 1,384 1,322 1,412
1,224 1,238 1,407 1,395 1,271 1,228 1,299 1,268
1,098 1,100 1,188 1,194 1,050 1,086 1,207 1,187 1,100 1,162 1,169 1,158 1,128 1,098 1,091

500 1,000 1,500 2,000 2,500

Available SDEW Onboard PDEW Flights DEW 15.6 16.0 16.9 16.9 16.8
15.7 16.5 16.8

14.9 14.6 14.4 14.5 14.6 14.5 14.3 14.3 14.2 14.2

11.4 11.5 11.6 11.7 11.3 11.5 11.4 11.4 11.4 11.4 11.0 10.8 11.4 11.6 11.5McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 30 Diego/Carlsbad

– Las Vegas route generated 1,096 passengers per day each way on average (see figure 17 ). In 2010 the average number of passengers per day each way traveling between the Carlsbad area and Las Vegas dropped to just 764

– a loss of 30% of local passengers, or 332 passengers per day each way.

While the largest reason for the decline in passengers between the Carlsbad area and Las Vegas is likely the decline in available seats

– down 30% since early 2009

– another factor has
been rising fares. The average one way fare between the Carlsbad area and Las Vegas in 2007 was $77 (see figure 17 ). The average fare has risen 26% since then, to $97 each way in 2010.



## Route Specific Data: Carlsbad

– Sacramento

The San Diego

– Sacramento route has not seen cuts as deep as some of the other routes from the region, but total capacity has come down by about a fifth in the last three years

. In J uly of
200 8 , airlines offered an average of 12.6 departures a day in each direction between San Diego International Airport and Sacramento International (see figure 18 ). By March of 2011, the number of daily departures had fallen to 10.2 , a loss of 19 % of all daily flights, or an average of
two and a half flights per day each way. 

## FIGURE 17 : O&D Passengers and Average One Way Fares, SAN+CLD

– LAS 2001

– 2010; Source: US DO T Table OD1A

716,600 660,070 690,330 743,240 823,050 801,930 800,010 716,680 625,800 557,740 981.6 904.2 945.7 1,018.1 1,127.5 1,098.5 1,095.9

981.8

857.3
764.0

0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 PDEW Total Passengers

$59 $57 $62 $65 $68 $76 $77 $86 $84 $97McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 31 Available seats in the San Diego

– Sacramento market have fallen in much the same way. In
J uly of 200 8 , airlines offered an average of 1
, 714 seats per day each way (see figure 18 ). By March of 2011 that number had fallen to 1, 392 seats per day each way

– a loss of 19 % of all seats, or 322 seats per day each way.

Assum ing California Pacific Airlines operates t hree flights per day in each direction between
Carlsbad and Sacramento , those flights would offer an average of 1 98 seats per day each way. The seats would only replace 62 % of the Sacramento seats that have been r emoved from the larger San Diego market.

P assenger demand between the San Diego area and Sacramento has fallen in the last four years as capacity has been cut and fares have gone up by $ 15 each way. In 2007 the San Diego/Carlsbad

– Sacramento route gener ated 1, 149 passengers per day each way on average (see figure 19 ). In 2010 the average number of passengers per day each way traveling
between the Carlsbad area and Sacramento dropped to just 896

– a loss of 22 % of local
passengers, or 253 passengers per day each way. 

## FIGURE 18 : Average Daily Departures, Daily Available Seats, and Daily Onboard Passengers SAN

- SMF; July 2008

– March 2011; Source: US DOT T100 Data

1,714 1,679 1,680 1,665 1,661

1,523 1,550 1,547 1,567 1,581 1,544 1,546 1,574 1,555 1,521 1,518 1,529 1,526 1,457 1,517 1,572 1,573 1,542 1,557 1,507 1,479 1,391 1,370 1,346 1,321 1,358 1,399 1,392 1,293 1,256

1,122 1,184 1,126 1,092

934 1,061 1,145 1,266 1,161 1,259 1,253 1,203 1,169 1,232 1,179 1,158

996 1,070 1,155 1,197 1,156 1,213 1,160 1,124 1,105 1,107 1,098 1,074
964 1,007 1,014

500 700 900 1,100 1,300 1,500 1,700 1,900

Available SDEW Onboard PDEW Flights DEW 12.6 12.3 12.3 12.2 12.2

11.2 11.3 11.3 11.5 11.6 11.3 11.4 11.5 11.4 11.2 11.1 11.2 11.1 10.7 11.1 11.5 11.5 11.3 11.4 11.0 10.8 10.2 10.0 9.9 9.7 10.0 10.3 10.2McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 32 While the largest reason for the decline in passengers between the Carlsbad area and
Sacramento was likely a reduced number of available seats

– down 19 % since summer of 2008

– another factor was rising fares. The average one way fare between the Carlsbad area and
Sacramento in 2007 was $7 9 (see figure 19 ). The average fare has risen 19 % since then, to $9 4 each way in 2010.



## Route Specific Data: Carlsbad

– Phoenix

The San Diego

– Phoenix route typically sees a seasonal peak in the winter, as is the case for most Phoenix routes. Available seats, flights, and passengers between the San Diego area and Phoenix have continued to decline for the last four years. In July of 2008, airlines offered an average of 21 departures a day in each direction between San Diego International Airport and Phoenix Sky Harbor International (see figure 20 ). By M arch of 2011, the number of daily departures had fallen to 17.6 , a loss of 17 % of all daily flights, or an average of t hree and a half flights per day each way. 

## FIGURE 19 : O&D Passengers and Average One Way Fares, SAN+CLD

– SMF 2001

– 2010; Source: US DOT Table OD1A

715,730 758,080 720,420 773,490 797,460 792,470 838,590 758,010 682,220 654,050 980.5 1,038.5 986.9 1,059.6 1,092.4 1,085.6 1,148.8
1,038.4

934.5 896.0

0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 PDEW Total Passengers

$68
$62 $69 $70 $76 $83 $79 $89 $87 $94McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 33 Available seats in the San Diego

– Phoenix market have fallen in much the same way. In July of 2008, airlines offered an average of 3
, 018 seats per day each way (see figure 20 ). By March of
2011 that number had fallen to 2
, 590 seats per day each way

– a loss of 1 4 % of all seats, or 428 seats per day each way.

Assuming California Pacific Airlines operates three flights per day in each direction between
Carlsbad and Phoenix , th ose flights would offer an average of 198 seats per day each way. The seats would only replace 46 % of the Phoenix seats that have been removed from the larger San Diego market.

Passenger demand between the San Diego area and Phoenix has fallen in the las t six years as capacity has been cut and fares have gone up by $ 2 5 each way. In 200 5 the San Diego/Carlsbad

– Phoenix route generated 1,1 01 passengers per day each way on average (see figure 21 ). In 2010 the average number of passengers per day each way traveling
between the Carlsbad area and Phoenix dropped to just 819

– a loss of 26 % of local passengers,

or 282 passengers per day each way. 

## FIGURE 20 : Average Daily Departures, Daily Available Seats, and Daily Onboard Passengers SAN

- PHX; July 2008

– March 2011; Source: US DOT T100 Data

3,018 2,894
2,687 2,559 2,546 2,449 2,578 2,648 2,625 2,629 2,567 2,627 2,654 2,559 2,428 2,384 2,400 2,373 2,352 2,448 2,497 2,505 2,487 2,569 2,571 2,525 2,526 2,517 2,481 2,491 2,501 2,523 2,590 2,312 2,233

1,849 1,849 1,743 1,689 1,675 1,769 1,869 2,001

1,762 1,906 2,102 2,010

1,775 1,876 1,826 1,780 1,736 1,863 1,948 1,960
1,758 1,868 2,038 1,939 1,828 1,865 1,888 1,887 1,816 1,871 1,965

500 1,000 1,500 2,000 2,500 3,000

Available SDEW Onboard PDEW Flights DEW 21.1 20.3

18.6 18.2 18.1 17.4 18.0 18.5 18.3 18.4 17.7 18.1 18.2 17.5 16.8 16.6 16.8 16.5 16.3 17.0 17.4 17.5 17.6 18.4 18.3 18.0 17.7 17.5 16.8 16.7 17.0 17.1 17.6McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 34 While the largest reason for the decline in passengers between the Carlsbad area and Phoenix

was likely the loss of available seats

– down 1 4 % since summer of 2008

– another factor was rising fares. The average one way fare between the Carlsbad area and Phoenix in 200 5 was $ 65 (see figure 21 ). The average fare has risen 38 % since then, to $9 0 each way in 2010.



## Route Specific Data: Carlsbad

– San Jose

As has been documented in this proposal, c apacity between the San Diego area and the Bay Area has been cut by a quarter since the summer of 2008, with a total loss of 1,681 seats per day each way in that time. A portion of those seat loses have come in t he San Jose market. As recently as July of 200 9 , airlines offered an average of 14 departures a day in each direction between San Diego International Airport and San Jose Mineta International (see figure 22 ). By March of 2011, the number of daily depar tures had fallen to eight , a loss of 41 % of all daily flights, or an average of six flights per day each way. 

## FIGURE 21 : O&D Passengers and Average One Way Fares, SAN+CLD

– PHX 2001

– 2010; Source: US DOT Table OD1A

740,620 683,100 728,190 760,490 803,710 788,920 777,710 717,640 631,420 598,070 1,014.5 935.8 997.5 1,041.8 1,101.0 1,080.7 1,065.4
983.1

865.0 819.3

0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 PDEW Total Passengers

$57 $56 $55 $57 $65 $73 $76 $82 $81 $90McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 35 Available seats in the San Diego

– San Jose market have fallen in much the same way. In July of
200 9 , airlines offered an average of 1519 seats per day each way (see figure 22 ). By March of 2011 that number had fallen to 1, 147 seats per day each way

– a loss of 24 % of all seats, or 3 72 seats per day each way.

Assuming California Pacific Airlines operates four flights per day in each direction between
Carlsbad and San Jose , those flights would offer an average of 264 seats pe r day each way. The seats would only replace 71 % of the San Jose seats that have been removed from the larger San Diego market.

Passenger demand between the San Diego area and San Jose has fallen in the last four years as capacity has been cut and fares have gone up by $1 2 each way. In 2007 the San Diego/Carlsbad

– San Jose route generated 1, 069 passengers per day each way on average (see figure 23 ). In 2010 the average number of passengers per day each way traveling
between the Carlsbad area and San Jose dropped to just 812

– a loss of 2 4 % of local passengers, or 25 7 passengers per day each way. 

## FIGURE 22 : Average Daily Departures, Daily Available Seats, and Daily Onboard Passengers SAN

- SJC; July 2008

– March 2011; Source: US DOT T100 Data

1,519 1,476 1,476 1,473 1,478 1,410 1,461 1,477 1,491 1,513 1,477 1,505 1,508 1,443
1,258 1,267 1,244 1,237 1,200 1,252 1,290 1,314 1,278 1,296 1,268 1,211 1,123 1,116 1,154 1,148 1,132 1,164 1,147 1,139 1,146 1,048 1,078 972 915 822 933 986 1,095 980 1,104 1,101 1,104

942 957 943 954
812 862 946 976 952 1,042 1,010 988 947 945 953 909 799 901 895

0 200 400 600 800 1,000 1,200 1,400 1,600 1,800 2,000

Available SDEW Onboard PDEW Flights DEW 14.3 13.9 13.9 13.8 14.0 13.5 13.9 14.1 14.2 14.4 14.1 14.4 14.3 13.1

9.2 9.3 9.1 9.1 8.8 9.2 9.5 9.6 9.4 9.6 9.3 8.9 8.3 8.2 8.5 8.4 8.3 8.6 8.4McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 36 While the largest reason for the decline in passengers between the Carlsbad area and San Jose is likely the decline in available seats

– down by a quarter since summer of 200 9

– another factor was rising fares. The average one way fare between the Carlsba d area and San Jose in 2007 was $ 86 (see figure 23 ). The average fare has risen 1 4 % since then, to $9 8 each way in 2010.



## Job Creation under This Strategic Plan

This strategic plan for new service under the federal Small Community Air Service Development Program is unique in that it has the potential to create a large number of new jobs in the
Carlsbad area

– many more new jobs than most other proposals. Because the airline benefitting from the Small Community Air Service Development Grant under this proposal is based in Carlsbad, itself,

a nd will be using the McClellan

Palomar Airport as its base of operations, it already employs a full headquarters staff within a few miles 

## FIGURE 23 : O&D Passengers and Average One Way Fares, SAN+CLD

– SJC 2001

– 2010; Source: US DOT Table OD1A

817,310 828,190 721,160 788,510 774,970 787,100 780,430 686,670 608,410 592,550 1,119.6 1,134.5

987.9 1,080.2 1,061.6 1,078.2 1,069.1

940.6
833.4 811.7

0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 900,000

2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 PDEW Total Passengers

$71

$65 $75 $76 $83 $91
$86 $90 $86 $98



## FIGURE 24 : Projected Job Growth at California Pacific Airlines, Years One through Five in CarlsbadMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 37 of the Airport. That staff currently numbers almost 100 employees.

California Pacific Airlines will have an es timated $90 million annual economic contribution to the North County Economy. This figure is projected to grow to over $200 million by the Airline’s fifth year of operation. Once the airline is up and running, projected for early second quarter of 2012, CP Air will employ over 150 people (see figure 24 ). Employment is forecast ed to grow to more than 500 people by year five, creating many new jobs in North County.McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 38 IMPLEMENTATION TIMELINE

The proposed implementation timeline for the project assumes the Department of Transportation will award Small Community Grant Funding in September 2011

. Once the award is announced,
the McClellan

- Palomar Airport will enter into a service agreement with California Pacific Airlines, providing detail on both the revenue guarantee and marketing portions of the proposal

. Based

on CP Air’s timeline for certification and service start, McClellan

- Palomar Airport expects flights to begin in the early part of the second quarter of 2012.

Once service is announced and schedules are published, the Airport will begin marketing the
new route s and working with California Pacific Airlines to monitor advance bookings. The Airport will continue its marketing pr ogram and continue to work with the new carrier to monitor the route once service begins. The Airport will submit grant status reports on a quarterly basis to the Department of Transportation throughout the proposed two year term of the minimum revenue guarantee.

While the estimated dates are targets, it is possible tha t new service could slip to later in 2012
should California Pacific Airlines not receive DOT certification on its current timeline.



## Activity/Project Milestone Estimated Date

SCASD Grant Award Announcement September 2011 Executive Grant Agreement with DOT October 2011 Negotiate Minimum Revenue Guarantee (MRG) With CPA October 2011 Announce Service December 2011 Publish Schedule December 2011 Begin Marketing of New Route December 2011 Monitor Advance Bookings January - April 2012 Service Launch April 2012 MRG Available for Service April 2012 - October 2014 Monitor Route Performance April 2012 - October 2014 Submit Grant Status Reports to DOT Quarterly Q4 2011 - Q4 2014 Close Grant October 2014McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 39 ALTERNATE PLAN

If, for some unforeseen reason, service is not commenced in a timely manner by C alif ornia
Pacific Airlines
, McClellan

- Palomar Airport proposes to use federal grant money awarded under the Small Community Air Service Development Program for other carriers that can provide connections to a large origin and destination market in the W est , or connectivity through a large
hub. T he Airport will continue its discussions with all other airlines that can provide additional
seats to strong markets

.

Since the community has never before received a Small Community Air Service Development Grant, it will have no limitations on whic h new hub the DOT could fund. Among the options are Alaska Airlines/Horizon Air service to San Jose or Sacramento; Delta service to Salt Lake City; US Airways service to Phoenix; Frontier Airlines service to Denver; and/or United service to Denver.
The A irport will not, however, be limited by this list of potential destinations, as the landscape for service could change before the Grant is awarded.McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 40 PUBLIC/PRIVATE PARTNERSHIP

San Diego County and McClellan

- Palomar Airport consistently work together, with several community organizations, on air service development projects. Many local partners have committed to work with the Airport to promote and market the new service. The Airport and the County will manage and coordinate the marketin g program.

Major partners are listed below, with profiles of their organizations. Other, smaller partners, including many area businesses, will also work with County Airports to promote and support additional local air service, beyond the major organizations listed below.



## California Pacific Airlines
California Pacific Airlines is the cash partner in this Small Community Air Service Development Grant proposal, making a commitment of $300,000 in direct marketing money. The Airline already leases space at McClellan

- Palomar Airport, paying monthly terminal fees for a ticket counter and office space. The Airline is committed to its partnership with the Airport.

The Airline will begin with five pure

- jet aircraft, Brazilian

- built Embraer 170s. The Embraer is a 70

- passenger, twin

- engine, which will be the quietest jet aircraft (Stage 4) to fly out of Palomar Airport. The aircraft has a 1,550

- mile range, and the planned CP Air passenger configuration will have 6 First Class, 20 Busi ness Class, and 44 Economy seats. With a 2x2 configuration, the aircraft will have no middle seats and more leg room.



## San Diego North County Economic Development Council The San Diego North County Economic Development Council has a mission to grow and sustain the economy of San Diego ’s North County through attraction, retention and new business development. The group is a member

- driven coalition of the private and public sectors working together to sustain and carefully grow the economic base of San Diego’s North County

. The Group’s main goal is to market the area internally and externally in an effort to retain and attract quality businesses and create additional, higher paying jobs. The San Diego North EDC
works with businesses, chambers of commerce, health organizations, local governments and educational institutions to improve the quality of life and economic sustainability of North County. The EDC also undertakes initiatives to establish North County as a "business

- friendly"McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 41 region and promote a regional approach to marketing North County as "San Diego's S mart
Place to Grow" a business.



## San Diego North Chamber of Commerce The San Diego North Chamber of Commerce is the steward for business in the region’s
communities , supporting businesses of every size through proven programming, a unified voice in front of government, and dedicated committees. Strong support from membership allows the Chamber to thoroughly focu s on each individual community while providing the benefit of a regional Chamber of Commerce.

The Chamber has three main areas of focus:
1. Business Development

– To identify and promote policies and programs that allow companies to invest in the region either through retention or expansion

. 2. Workforce Development

– Provide a regional workforce that is capable and competent through collaboration with business and e ducation.
3. Infrastructure

– Develop and implement strategies to ensure regional capacity in six
business

- critical categories: water, housing, energy, transportation, economic competitiveness and environmental stewardship.



## Carlsbad Chamber of Commerce With more than 1,600 member businesses employing 65,000 or more, the Carlsbad Chamber is the second largest chamber in San Diego County and the 10th largest in California. It truly is an influential force for the region’s business community. It’s importan t to note that the Carlsbad
Chamber is independent from government. The Chamber receive s no operating funds from the
C ity of Carlsbad or any o ther government agency.



## San Diego North Convention and Visitors Bureau The San Diego North Convention and Visitors Bureau is a full

- service organization providing information and assistance to the region's tourism and hospitality industries, including the areas of La Jolla north to Oceanside, Rancho Bernardo north to Fallbrook, Julian and the Anza

- Borrego
Dese rt. The CVB works closely with its members to promote San Diego North as a premier, year

round resort destination, including McClellan

- Palomar Airport

.McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 42 Palomar Airport Association (PAA)
The Palomar Airport Association (PAA) is an all

- volunteer Cal ifornia Corporation. The PAA is a general

- interest, public

- benefit community service organization for pilots and non

- pilots alike, for
McClellan

- Palomar Airport

. The PAA is an aviation resource for the community, government agencies and the press for McClellan Palomar Airport.

The PAA work s together with neighboring aviation organizations and supporters for the benefi t of
McClellan

- Palomar Airport. The Group’s focus is airport pr eservation and education, and it promote s balanced public airport use for all types/classes of aviation

-- from small private aviation through commercial operations. PAA hosts community programs, events, education, public relations and coordination of volunteer support activities. The PAA believe s that when everyone gets togethe r, things are better for all: for aviation users , businesses and the community.McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 43 FUNDING PLAN

Marketing and Advertising
McClellan

- Palomar Airport proposes to spend $80 0,000 in funds on marketing and advertising promotions in support of California Pacific Airlines’ new service at the Airport . The goal is to decrease leakage and increase ridership and usage of new service through campaigns targeted at north San Diego County

. $300,000 of the marketing budget will come from California Pacific Airlines, itself, while $ 1,0 00,000 will come from the SCASD Program.



## Revenue Guarantee
McClellan

- Palomar Airport proposes to make available $500,000 in funds for a revenue guarantee to California Pacific Airlines , to cover start

- up losses that may occur during the first 12 months of service. Subject to negotiation, payments will be made to the new airline quarterly when income derived from passengers and cargo is less than agr eed expenses on the route. Revenue generated that exceeds expenses will be carried forward and tapped before any grant funds are used.



## In

- Kind Services The following organizations will help promote the new service through their various membership
groups. There is no estimated value to these services.

**•** California Pacific Airlines

**•** Carlsbad Chamber of Commerce

**•** San Diego North Convention and Visitors Bureau

**•** San Diego North Chamber of Commerce

**•** San Diego North County Economic Development Council

**•** Palomar Airport Association

**•** County of San Diego

**•** City of CarlsbadMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 44 Additional Costs As part of this program, McClellan

- Palomar Airport understands that additional expenses will be incurred, such as monitoring the results of the program and reporting those r esults back to the US DOT. In addition, the Airport expects to incur some expenses in the negotiation of the revenue guarantee with California Pacific Airlines . The Airport will fund these projects out of other Airport

sources.McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 45 PERFORMANCE MEASURES AND FINANCIAL CONTROLS

The success of new service will be based on three measurable variables: the increase in available seats in the market, the number of enplanements on the route, and the average airfares charged in the affected city

- pairs. The first two measurements will include a monthly comparison once the program begins to post numbers. The third measurement will be derived from US DOT OD1A reports.

As the sponsor, McClellan

- Palomar Airport, and the Airport’s operator, County of San Diego , will be the responsible parties for all fiscal matters and DOT reporting requirements. As a public entity the DOT can be assured that proper financial controls are in place to guarantee that the DOT’s gr ant will be used in accordance with any subsequent agreement. The Airport understands that the grant is a reimbursable grant, meaning the Airport is responsible for program expenditures and will submit invoices to the DOT for reimbursement, based on a
per centage of the total grant request.

The Airport has developed this proposal as a one

- time grant. The advertising and marketing program will commence a few months before service starts and last for at least 12 months. The revenue guarantee program will also be in place for 12 months, with two additional 12

- month periods available for negotiation. It is projected that the service will be financially self

- sustaining
within the second 12 month s of service.McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 46 LEGAL SPONSOR

McClellan

- Palomar Airport is the legal sponsor responsible for administering the program.
McClellan

- Palomar Airport is a government entity.

McClellan

- Palomar Airport 2192 Palomar Airport Road Carlsbad, California 92011 Peter Drinkwater
, Director of Airports 619

. 956 .4 800 Peter.Drinkwater@sdcounty.ca.govMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 47 LETTER S OF SUPPORTMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 48McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 49McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 50McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 51McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 52McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 53McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 54McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 55McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 56McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 57 AVAILABILITY OF ALTERNATE AIRPORTS

Carlsbad, California is serviced by McClellan

- Palomar Airport, located 2.9 miles off Interstate 5. The Carlsbad catchment area, seen in orange (See f igure 25 ), is home to almo st 1.15 million.

• The Carlsbad area comprises 12.3% of the overall population of the entire shaded area

– the area that includes San Diego, Carlsbad, Orange County, and Long Beach.

• The total population of the shaded area is 9.3 million, making it one of the most populou s

one

- hour catchment areas of any airport in the country.



## FIGURE 25 : Location of San Luis Obispo County in relation to other Southern California airportsMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 58 AIRPORT INFORMATION

Expansion has been ongoing since the airport’s opening in 1959, culminating in the 2008 Grand Opening of a new 18,000 sq. ft

. state

- of

- the

- art terminal building . This building combine s airline terminal/security screening with a restaurant, Customs facilit y and other amenities. The
terminal’s o verhead canopies mimic sailboats and shell

- encrusted floors form sweeping conch shell patterns, reminiscent of the ocean only a few miles away. Floor

- to

- ceiling windows and several outdoor areas provide passengers th e opportunity to watch aircraft come and go. Rocking chairs offer a place to sit and wait for passengers or take a quick break.

The airport has a single 5,000 ft. runway that underwent a major renovation in August 2010

. With the new terminal building and 5,000

- foot runway, McClellan

- Palomar Airport is one of the most modern airports in the country, an airport that the citizens of Carlsbad and all of San Diego County can be proud of ; and one of the finest bases for aviation
businesses on the west coast. 

## New Terminal Building McClellan

- Palomar AirportMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 59 COMMUNITY PROFILE

Th e City of Carlsbad prides itself on providing an exceptionally high level of service to its
residents. T his mid

- sized city has maintained its small

- town feel by carefully managing growth, encouraging community involvement and preserving almost half of the city as open space.

Carlsbad is home to 106,804 residents with a median age of 41 years. The median family income
in Carlsbad was $104,412 in 20 09

– one of the highest median incomes in the State of Californi a

– an increase of 9.5% since 2008

. Carlsbad residents spend an average of $8,000 on vacation each year

– almost $2,000 above the national average spent on vacation.

The City offers its residents a thriving Parks and Recreation system as well as an extensive trail system. While the citywide trails system provides many recreational opportunities to enjoy the City's unique natural areas, it also provides a comprehensive network for non

- motorized transportation routes, connecting neighborhoods to commercial and business areas, schools, parks, and Carlsbad beaches.



## Tourism in the Carlsbad Region

Carlsbad is an area worthy of the 30 million visitors it attracts each year. San Diego County enjoys more than 30 million leisure travelers a year and those travelers spend more than $8 billion throughout the county. Boasting n early seven miles of beautifu l beaches, picturesque lagoons
and the charm of a European village coupled with world class golf, spas and shopping

-- Carlsbad provides something for every travel taste and budget.

Carlsbad is host to unmatched shopping, dining, beaches, golf, nature and attractions such as LEGOLAND® California, sporting events and seas onal festivals. Major Events include the Carlsbad Marathon, Carlsbad 5000, Junior Carlsbad, Carlsbad Village Street Faire, Carlsbad Triathlon, Art in the Village, ArtSplash, Beach'n 101 Cruise, Bike MS Bay to Bay Tour, Oktoberfest, Jazz in the Park (seaso nal) , and Shakespeare in the Park (seasonal)

.McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 60 Beaches Carlsbad is home to seven miles of pristine,
uncrowded and sun

- drenched beaches. Renowned as one of the best surf spots in
S

outhern California, there’s plenty of wa ter and
sand for all to enjoy. Visitors can w alk along the water’s edge, splash in the waves or soak in
the sun . For the more adventurous, the area also offers s urfing, sailing, jet skiing, fishing, kayaking, swimming, boogie boarding, biking, birding, nature walks, golf, tennis , hiking, and whale watching

.

Resorts In Carlsbad, golf isn’t just a game, it’s an experience. Beautifully designed, world

- class courses offer unmatched amenities, such as GPS

- equipped golf carts that help gauge your next shot, gorgeous clubhouses to relax in, golf classes with top golf pros, and nearby resorts and spas for when you’re done playing and want to unwind.

LEGOLAND® California and Water Park
The 128

- acre Park is designed specifically to appeal to families with children ages 3 to 12. The P ark features roller coasters, LEGO

- themed rides, interactive shows, hands

- on attractions, LEGO

- building play areas, and the famously breathtaking Miniland, restaurants, shopping, landscaped features and gardens.

Open ed June 2010, the world’s first and only LEGOLAND Water Park lets the imagination flow at this interactive, splash

- filled, fun time for the entire family. The centerpiece
of the Water Park is a 45

- foot

- tall to wer designed to immerse children in the creative world of
LEGO® . The park also include s The Build

- A

- Raft river

– a lazy river where guests float on their own
custom

- built LEGO raft as well as s everal water slides including six

- person raft slide s and one

person tube slides as well as slides designed especially for toddlers

.McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 61 Leo Carrillo Ranch Historic Park Once part of the original 2,538 acre working rancho and
vacation retreat of Leo Carrillo
, (who acted in almost 100 films
from 1927 to 1950 and co

- starred in the TV series The Cisco Kid ) this historic ranch is an extraordinary educational and
recreational resource. The City of Carlsbad has stabilized, preserved and restored many of the buildings on this 27 acre parcel. Historic ran ch structures include a visitors center, hand

crafted adobe buildings, hacienda, reflecting pool, cabana, cantina, carriage house tack shed, stable, barn and foundry
, and equipment shed.

SEA LIFE Aquarium Merlin's SEA LIFE® attractions are an ideal, friendly and authoritative guide to the last great frontier...the seas and oceans of the world and their myriad mysterious and amazing inhabitants. Unrivalled display technology, biological expertise and entertainment skills combine to provide seamless jo urneys through US and tropical waters, and astonishing close encounters with everything from humble shrimps and starfish to seahorses, sharks and stingrays.

SEA LIFE® is designed to be a child’s first interactive guide to the life of the sea, combining

ac tive, hands

- on learning with fascinating educational talks, and opportunities to have up close and personal encounters with a variety of sea creatures. A visit to SEA LIFE® is an experience like
no other!McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 62 Carlsbad Economic Overview

At a time when many cities are experiencing population and job losses, Carlsbad is exceeding state and national averages in both areas. Population g rowth in Carlsbad o utpaces g rowth
t hroug hout Calif ornia. As of 2009 it is four points higher than S an Francisco and Los Angeles (see
f igure 2 7 ).

F rom 2000 to 2008 , jobs in Carlsbad grew by 22.80%. Since February, the Carlsbad/San Diego Economy h as a dded 1,100 n ew f ull

- t ime j obs

– the s econd b est j ob g rowth in California

. 1.5% 2.7% 3.6% 3.9% 4.1% 4.3% 5.3% 6.9% 8.1%

1.04% 0.70% 0.40% 0.17% 0.31% 0.63% 1.58% 2.99% 4.38%

0.42% 0.57% 0.65% 0.34% 0.12%

- 0.28% 0.18% 0.97% 1.82%

1.02% 1.90% 2.57% 2.95% 2.92% 2.54% 2.37% 2.98% 3.84%

- 2% 0% 2% 4% 6% 8%



### 2001 2002 2003 2004 2005 2006 2007 2008 2009 Carlsbad

- San Diego San Francisco

- Oakland San Jose 

## FIGURE 27: Population Growth in Select California Metro AreasMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 63 Employment in the Carlsbad Area

Select Company Profiles

Callaway Golf Co. Headquartered in Carlsbad, Callaway Golf Company is one of the world’s designers and manufacturers of golf equipment, including clubs, balls and apparel. High

- end clientele include customers for their custom

- made products. With ever

- expanding global markets, including India, Korea, China, Europe and Latin America, the need for air service is undeniable.

ViaSat, Inc. ViaSat, Inc. is a high

- technology company, specializing in the design and manufacture of communications and networking equipment with its global headquarters in Carlsbad

. Sectors within which they work include the military, aviation, maritime and mass transit. With 13 additional offices of ViaSat and their subsidiaries around the world, employee air travel is frequent. The company also has a regular presence at industry conferences on both a national and global scale, requiring additional employee travel several times a month.McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 64 LEGOLAND® California , LLC
LEGOLAND® California is a 128

- acre family theme park located in
C arlsbad , featuring more than 15,000 LEGO® models in the Park
created from more than 35 million of the iconic LEGO® bricks. In
addition to employing 1,100 people in the Carlsbad office, the park brings in more than 1,750,000 visitors annually.

LaCosta Resort and Spa Providing employment for 1,000 people in the Carlsbad area, La Costa Resort and Spa , “ California's Playground for All Ages ”, brings a taste of the coastal California lifestyle to each and every visitor

. S et within a lovely 400

- acre village, La Costa Resor t and Spa offers 610 spacious and well

appointed guestrooms including luxury Villas and 76 suites. La Costa is a place where high

- end clientele with busy schedules escape the everyday to experience a life of play and leisure.
More convenient air service would help this destination well.

Life Technologies
The systems, consumables and services of Life Technologies enable researchers to accelerate scientific exploration, driving to discoveries and developments that make life even better. Their customers do their work across the biological spectrum, working to advance personalized medicine, regenerative science, molecular diagnostics, agricultural and environmental research, and 21st century
forensics. While the Carlsbad headquarters employs 960, the corporation itself employs more
than 9,5 00 company

- wide in 60 offices in 28 countries , so local, national and global travel is essential for this diverse company

.

G emo logical Institute of America Established in 1931, the Gemological Institute of A merica is headquartered in Carlsbad and is the world’s foremost authority on diamonds, colored stones, and pearls. GIA exists to protect all purchasers of gemstones, by providing the education, laboratory services, research, and instruments needed to accur ately and objectively determine gemstone quality. The headquarters in Carlsbad, which also includes a laboratory and instrument center, employs 600 people, while the organization itself has 17 offices globally.McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 65 Military Presence
The Carlsbad Area is h ome to a m ajor m ilitary i nstallation with 38,000 a ctive d uty
and o ver 60,000 m ilitary and c ivilian p ersonnel

. Camp Pendleton is located in North San Diego County, in Southern California. The base is adjacent to the City of Oceanside, a military town, by the Main Gate in the South. The size of Camp Pendleton is comparable to the size of the State of Rhode Island.

Marine Corps Base Camp Pendleton has the responsibility of providing housing, training facilities and logistical support for the Fleet Marine Force elements and other units assigned here. In addition, the base conducts specialized s chools and other such training as the Commandant of the Marine Corps may direct.

Major commands are Marine Corps Base, 1st Marine Expeditionary Force, 1st Marine Division, 1st Marine Logistics Group, elements of the 3rd Marine Aircraft Wing, and many tena nt units (Marine Corps Air Station Miramar , ACU

- 5, Balboa Naval Hospital, the Marine Corps Tactical Systems Support Activity (MCTSSA), Naval Weapons Station Fallbrook, and a Reserve Support Unit).

The neighboring cities of Carlsbad, Escondido, Fallbrook, Oceanside, San Clemente, San Marcos, Temecula and Vista provide employment, housing and services needed by the Camp Pendleton population.

Many military personnel use commercial flights for their personal travel during leaves and other uses. With nearly 100,000 people to accommodate, many of whom are on tight schedules, air service that provides a more convenient location and greater options in schedule would be a major benefit to this base.McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 66 COMPARISON TO OTHER COMMUNITIES IN REGION

FIGURE 27 : Top 60 Southwest Region Markets Ranked by O& D Passengers Q4 2010; Source: US DOT Table OD1A

Airport

1 Los Angeles, CA 3,262,610 3,801,070 4,028,890 3,759,550 40,865 3.9% 12.9% 14,852,120 40,691 2.1% 2 Las Vegas, NV 3,435,850 3,691,240 3,561,780 3,475,090 37,773 1.0% 11.9% 14,163,960 38,805 -2.4% 3 Denver, CO 2,685,070 2,992,150 3,229,240 2,950,010 32,065 5.4% 10.1% 11,856,470 32,483 4.3% 4 San Francisco, CA 2,327,220 2,817,180 2,961,780 2,840,430 30,874 4.5% 9.7% 10,946,610 29,991 3.9% 5 Phoenix, AZ 2,644,380 2,573,120 2,205,250 2,596,670 28,225 1.1% 8.9% 10,019,420 27,450 -1.2% 6 San Diego, CA 1,666,760 1,880,730 2,016,600 1,834,270 19,938 0.2% 6.3% 7,398,360 20,269 -0.9% 7 Honolulu, HI 1,220,170 1,318,350 1,385,400 1,277,440 13,885 -0.9% 4.4% 5,201,360 14,250 -4.6% 8 Salt Lake City, UT 1,230,960 1,123,010 1,176,340 1,115,750 12,128 2.3% 3.8% 4,646,060 12,729 -1.5% 9 Oakland, CA 901,110 1,076,100 1,121,660 1,062,350 11,547 -0.6% 3.6% 4,161,220 11,401 -1.7% 10 Orange County, CA 949,130 1,068,280 1,070,610 1,019,250 11,079 -3.0% 3.5% 4,107,270 11,253 -0.5% 11 Sacramento, CA 882,850 1,087,710 1,073,490 1,006,120 10,936 0.0% 3.4% 4,050,170 11,096 -0.7% 12 San Jose, CA 813,650 978,420 993,440 953,360 10,363 1.9% 3.3% 3,738,870 10,243 -1.1% 13 Albuquerque, NM 502,890 619,490 642,560 600,720 6,530 -1.5% 2.1% 2,365,660 6,481 -4.1% 14 Ontario, CA 518,490 606,400 587,910 570,890 6,205 1.5% 2.0% 2,283,690 6,257 -0.5% 15 Burbank, CA 516,040 567,870 563,040 546,970 5,945 -2.8% 1.9% 2,193,920 6,011 -2.7% 16 Kahului, HI 492,000 538,990 578,610 518,040 5,631 11.1% 1.8% 2,127,640 5,829 2.3% 17 Tucson, AZ 431,840 428,510 386,610 428,630 4,659 3.4% 1.5% 1,675,590 4,591 2.3% 18 Reno, NV 413,030 427,370 454,830 376,800 4,096 1.3% 1.3% 1,672,030 4,581 2.2% 19 Long Beach, CA 287,920 336,840 372,410 341,630 3,713 11.3% 1.2% 1,338,800 3,668 1.4% 20 Kona, HI 258,410 269,980 283,820 268,320 2,917 6.7% 0.9% 1,080,530 2,960 -2.1% 21 Kauai Island, HI 257,750 287,430 307,120 263,510 2,864 -0.2% 0.9% 1,115,810 3,057 -4.6% 22 Colorado Springs, CO 165,310 203,570 217,670 194,550 2,115 -4.8% 0.7% 781,100 2,140 -7.8% 23 Palm Springs, CA 205,480 142,700 86,550 150,700 1,638 0.2% 0.5% 585,430 1,604 -0.9% 24 Hilo, HI 148,140 152,750 154,370 146,280 1,590 -6.7% 0.5% 601,540 1,648 -6.0% 25 Fresno, CA 100,660 127,610 133,360 122,850 1,335 1.8% 0.4% 484,480 1,327 0.6% 26 Mesa Gatew ay, AZ 101,740 100,760 96,800 102,160 1,110 32.5% 0.3% 401,460 1,100 39.9% 27 Santa Barbara, CA 73,650 90,570 97,100 82,680 899 2.7% 0.3% 344,000 942 2.3% 28 Grand Junction, CO 41,280 49,120 55,020 52,040 566 10.1% 0.2% 197,460 541 -4.7% 29 Monterey, CA 38,050 47,140 44,490 40,450 440 -4.2% 0.1% 170,130 466 0.6% 30 Durango, CO 31,820 37,860 49,100 36,380 395 1.6% 0.1% 155,160 425 11.0% 31 San Luis Obispo, CA 25,940 30,130 29,620 33,520 364 23.6% 0.1% 119,210 327 11.1% 32 Aspen, CO 80,470 32,160 52,760 32,740 356 -13.4% 0.1% 198,130 543 2.0% 33 Eagle/Vail, CO 117,790 11,360 24,760 31,380 341 -9.4% 0.1% 185,290 508 8.2% 34 Bakersfield, CA 20,070 23,950 24,070 26,480 288 15.7% 0.1% 94,570 259 3.3% 35 Santa Rosa, CA 18,320 22,170 24,940 24,400 265 7.8% 0.1% 89,830 246 2.8% 36 Arcata/Eureka, CA 18,140 22,780 20,770 23,100 251 -1.6% 0.1% 84,790 232 -11.2% 37 Guam 20,590 23,630 26,080 22,770 248 8.1% 0.1% 93,070 255 3.3% 38 Hoolehua, HI 13,370 13,570 13,610 21,120 230 50.6% 0.1% 61,670 169 -5.2% 39 Hayden, CO 66,750 7,700 10,850 18,960 206 -6.1% 0.1% 104,260 286 -10.1% 40 Yuma, AZ 19,890 17,990 14,680 18,830 205 -0.8% 0.1% 71,390 196 5.2% 41 Montrose, CO 35,800 13,760 23,820 16,360 178 3.5% 0.1% 89,740 246 2.1% 42 Saipan, PT 17,930 17,980 18,290 16,260 177 -3.7% 0.1% 70,460 193 1.2% 43 Bull. City/Laughlin, AZ 23,250 15,650 14,810 13,230 144 53.5% 0.0% 66,940 183 15.5% 44 Stockton, CA 7,040 9,320 19,370 12,760 139 145.4% 0.0% 48,490 133 81.5% 45 Flagstaff, AZ 10,530 16,440 16,290 12,760 139 -14.5% 0.0% 56,020 153 -6.0% 46 Redding, CA 10,240 13,380 12,120 12,500 136 8.1% 0.0% 48,240 132 3.7% 47 Fort Collins, CO 7,700 7,680 7,530 11,300 123 71.5% 0.0% 34,210 94 15.8% 48 Santa Maria, CA 9,660 11,760 12,270 11,150 121 8.5% 0.0% 44,840 123 10.0% 49 Carlsbad, CA 6,320 4,010 6,170 9,880 107 54.4% 0.0% 26,380 72 7.0% 50 Lanai City, HI 10,060 10,410 9,920 9,870 107 1.0% 0.0% 40,260 110 -3.3% 51 Santa Fe, NM 7,860 11,580 11,800 9,410 102 77.2% 0.0% 40,650 111 319.5% 52 Saint George, UT 8,550 9,450 3,160 9,240 100 8.6% 0.0% 30,400 83 -20.0% 53 Kapolua, HI 8,820 9,340 9,370 9,110 99 7.4% 0.0% 36,640 100 -6.0% 54 Rosw ell, NM 7,280 9,480 10,340 8,910 97 -10.7% 0.0% 36,010 99 0.7% 55 Gunnison, CO 18,090 3,580 7,140 6,990 76 -8.0% 0.0% 35,800 98 -11.8% 56 Chico, CA 5,100 6,020 4,570 5,700 62 -4.8% 0.0% 21,390 59 -8.2% 57 Modesto, CA 5,170 6,410 4,830 5,650 61 -12.0% 0.0% 22,060 60 -16.9% 58 Elko, NV 4,370 4,730 2,940 4,950 54 11.2% 0.0% 16,990 47 -5.0% 59 Pueblo, CO 1,290 1,490 1,960 4,750 52 271.1% 0.0% 9,490 26 139.6% 60 Rota, PT 5,840 4,320 4,780 4,400 48 -25.8% 0.0% 19,340 53 -15.4% 1 Q 10 2 Q 10 3 Q 10 4 Q 10 Regional Passengers 27,267,070 29,884,300 30,426,720 29,223,010 317,641 2.2% 100.0% 116,801,100 320,003 0.1% 4 Q 10 Dec-10 Dec-10 ? Qtr/Qtr Share PDEW YE YE/YE 2010 PDEW Rank ? 1 Q 10 2 Q 10 3 Q 10 4 Q 10 4 Q 10McClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 67 Airport

1 Los Angeles, CA $549,420 $680,390 $733,660 $660,550 $3,610 10.3% 14.4% $2,624,020 $3,595 12.6% 2 San Francisco, CA $385,390 $515,540 $546,150 $508,440 $2,778 14.5% 11.1% $1,955,520 $2,679 16.9% 3 Las Vegas, NV $472,430 $542,610 $503,640 $489,990 $2,678 9.2% 10.7% $2,008,670 $2,752 10.0% 4 Denver, CO $356,850 $411,120 $452,740 $410,350 $2,242 9.9% 8.9% $1,631,060 $2,234 10.7% 5 Phoenix, AZ $386,610 $386,740 $322,410 $397,550 $2,172 12.5% 8.7% $1,493,310 $2,046 10.3% 6 San Diego, CA $247,680 $292,450 $317,410 $285,780 $1,562 9.9% 6.2% $1,143,320 $1,566 11.1% 7 Honolulu, HI $215,480 $246,930 $259,350 $250,000 $1,366 10.5% 5.4% $971,760 $1,331 5.9% 8 Salt Lake City, UT $192,400 $180,130 $195,390 $178,970 $978 11.0% 3.9% $746,890 $1,023 12.8% 9 Orange County, CA $131,360 $157,890 $166,910 $153,090 $837 12.2% 3.3% $609,250 $835 13.8% 10 Sacramento, CA $119,180 $158,260 $162,310 $147,800 $808 10.3% 3.2% $587,550 $805 9.5% 11 San Jose, CA $106,260 $142,360 $147,430 $136,330 $745 15.4% 3.0% $532,380 $729 14.1% 12 Oakland, CA $105,700 $136,880 $146,380 $133,540 $730 6.4% 2.9% $522,500 $716 9.8% 13 Kahului, HI $89,940 $94,380 $102,530 $97,080 $530 23.5% 2.1% $383,930 $526 11.8% 14 Albuquerque, NM $71,710 $92,990 $98,760 $90,890 $497 7.2% 2.0% $354,350 $485 6.5% 15 Ontario, CA $69,740 $87,320 $88,420 $81,180 $444 8.8% 1.8% $326,660 $447 9.8% 16 Tucson, AZ $66,110 $69,980 $61,470 $70,900 $387 11.4% 1.5% $268,460 $368 9.9% 17 Burbank, CA $61,000 $71,670 $73,650 $69,850 $382 5.5% 1.5% $276,170 $378 6.7% 18 Reno, NV $58,650 $63,640 $69,130 $53,240 $291 3.5% 1.2% $244,660 $335 8.3% 19 Kona, HI $45,330 $47,790 $48,110 $50,360 $275 23.1% 1.1% $191,590 $262 13.5% 20 Kauai Island, HI $41,650 $49,350 $52,640 $48,120 $263 15.8% 1.0% $191,760 $263 10.3% 21 Long Beach, CA $29,540 $38,030 $40,890 $39,770 $217 16.4% 0.9% $148,230 $203 5.3% 22 Colorado Springs, CO $28,420 $36,070 $37,720 $33,230 $182 0.2% 0.7% $135,440 $186 0.0% 23 Palm Springs, CA $34,440 $23,560 $14,920 $26,790 $146 10.2% 0.6% $99,710 $137 4.6% 24 Fresno, CA $18,100 $24,050 $26,210 $24,570 $134 18.2% 0.5% $92,930 $127 11.1% 25 Santa Barbara, CA $12,790 $16,190 $18,810 $16,260 $89 12.8% 0.4% $64,050 $88 10.3% 26 Hilo, HI $13,690 $14,920 $14,990 $15,340 $84 23.1% 0.3% $58,940 $81 24.7% 27 Guam $10,510 $12,550 $15,100 $11,420 $62 27.9% 0.2% $49,580 $68 13.7% 28 Grand Junction, CO $7,010 $8,850 $9,540 $9,610 $53 17.3% 0.2% $35,010 $48 5.7% 29 Mesa Gatew ay, AZ $9,790 $8,960 $7,420 $9,030 $49 40.7% 0.2% $35,200 $48 45.5% 30 Monterey, CA $6,620 $8,740 $9,240 $7,730 $42 6.6% 0.2% $32,330 $44 10.6% 31 Aspen, CO $16,960 $6,990 $12,800 $7,500 $41 -8.6% 0.2% $44,250 $61 9.9% 32 Eagle/Vail, CO $21,990 $2,510 $4,610 $6,990 $38 -0.6% 0.2% $36,100 $49 19.7% 33 Durango, CO $5,340 $6,490 $8,750 $6,600 $36 6.1% 0.1% $27,180 $37 15.0% 34 San Luis Obispo, CA $4,540 $5,530 $6,360 $6,590 $36 17.9% 0.1% $23,020 $32 3.9% 35 Bakersfield, CA $4,330 $5,370 $5,630 $6,100 $33 29.0% 0.1% $21,430 $29 12.9% 36 Yuma, AZ $4,480 $4,400 $3,750 $4,580 $25 7.0% 0.1% $17,210 $24 10.2% 37 Arcata/Eureka, CA $3,460 $4,290 $3,950 $4,030 $22 -8.4% 0.1% $15,730 $22 -6.0% 38 Hayden, CO $10,450 $1,660 $2,320 $3,910 $21 -5.1% 0.1% $18,340 $25 -0.4% 39 Montrose, CO $6,500 $2,830 $4,790 $3,310 $18 5.8% 0.1% $17,430 $24 13.3% 40 Santa Rosa, CA $2,000 $2,640 $3,030 $2,830 $15 12.7% 0.1% $10,500 $14 7.6% 41 Flagstaff, AZ $1,830 $3,010 $3,130 $2,760 $15 14.0% 0.1% $10,730 $15 14.5% 42 Pago Pago, PT $2,820 $3,810 $3,660 $2,540 $14 -28.0% 0.1% $12,830 $18 -5.5% 43 Bull. City/Laughlin, AZ $3,210 $2,180 $2,210 $2,090 $11 69.9% 0.0% $9,690 $13 27.8% 44 Rosw ell, NM $1,550 $2,050 $2,260 $1,910 $10 3.2% 0.0% $7,770 $11 7.3% 45 Redding, CA $1,680 $2,190 $2,390 $1,860 $10 -13.5% 0.0% $8,120 $11 -1.0% 46 Santa Fe, NM $1,380 $2,390 $2,420 $1,850 $10 96.8% 0.0% $8,040 $11 372.9% 47 Santa Maria, CA $1,470 $1,720 $2,060 $1,730 $9 10.9% 0.0% $6,980 $10 5.3% 48 Saipan, PT $1,990 $2,220 $2,330 $1,700 $9 9.0% 0.0% $8,240 $11 18.7% 49 Gunnison, CO $2,960 $710 $1,450 $1,460 $8 -1.4% 0.0% $6,580 $9 2.3% 50 Carlsbad, CA $800 $510 $970 $1,130 $6 50.7% 0.0% $3,410 $5 21.8% 51 Lanai City, HI $1,010 $900 $820 $950 $5 8.0% 0.0% $3,680 $5 -1.6% 52 Hoolehua, HI $710 $660 $670 $910 $5 37.9% 0.0% $2,950 $4 1.4% 53 Kapolua, HI $880 $920 $910 $880 $5 1.1% 0.0% $3,590 $5 -1.9% 54 Inyokern, CA $920 $1,140 $1,240 $860 $5 -1.1% 0.0% $4,160 $6 -6.9% 55 Saint George, UT $810 $960 $690 $830 $5 13.7% 0.0% $3,290 $5 3.1% 56 Chico, CA $650 $800 $770 $790 $4 9.7% 0.0% $3,010 $4 16.2% 57 Modesto, CA $720 $850 $890 $760 $4 -1.3% 0.0% $3,220 $4 3.2% 58 Elko, NV $640 $700 $890 $710 $4 24.6% 0.0% $2,940 $4 25.6% 59 Fort Collins, CO $440 $420 $370 $690 $4 72.5% 0.0% $1,920 $3 11.6% 60 Farmington, NM $530 $650 $670 $640 $3 39.1% 0.0% $2,490 $3 27.0% 1 Q 10 2 Q 10 3 Q 10 4 Q 10 Regional Revenue $4,056,860 $4,697,340 $4,835,880 $4,592,190 $25,094 11.2% 100.0% $18,182,270 $24,907 11.2% RDEW YE/YE 2010 RDEW Qtr/Qtr Share Rank Dec-10 Dec-10 

### ? ? 4 Q 10 1 Q 10 2 Q 10 3 Q 10 4 Q 10 4 Q 10 

## FIGURE 28 : Top 60 Southwest Region Markets Ranked by O&D Revenue Q4 2010; Source: US DOT Table OD1AMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 68 Airport

1 Guam $533.40 $554.61 $601.64 $533.00 19.5% $86.96 $557.97 10.7% $54.10 2 Eagle/Vail, CO $236.52 $264.75 $222.82 $278.77 10.9% $27.44 $243.56 13.1% $28.24 3 Aspen, CO $241.19 $242.20 $265.33 $258.65 7.0% $17.01 $250.83 8.2% $19.10 4 Yuma, AZ $233.94 $252.11 $264.05 $253.08 8.5% $19.86 $249.78 5.3% $12.57 5 Bakersfield, CA $225.33 $238.23 $245.21 $241.16 11.5% $24.90 $238.08 10.5% $22.56 6 Hayden, CO $187.04 $235.47 $231.29 $238.47 1.7% $3.94 $205.28 13.8% $24.93 7 Gunnison, CO $192.32 $221.23 $222.87 $231.67 4.2% $9.28 $209.51 18.3% $32.39 8 Montrose, CO $212.32 $230.30 $228.10 $228.61 0.7% $1.54 $222.37 12.7% $25.10 9 Rosw ell, NM $221.73 $224.28 $226.57 $225.17 17.6% $33.75 $224.64 6.9% $14.44 10 Flagstaff, AZ $181.50 $189.68 $198.41 $224.96 33.0% $55.84 $198.73 20.8% $34.17 11 Santa Fe, NM $202.54 $226.22 $231.49 $220.65 9.9% $19.89 $221.99 11.4% $22.72 12 Santa Barbara, CA $194.39 $196.72 $212.16 $215.72 8.4% $16.77 $205.20 7.7% $14.73 13 Honolulu, HI $194.20 $203.90 $204.63 $214.60 11.4% $21.99 $204.45 12.1% $22.07 14 San Luis Obispo, CA $193.14 $201.01 $233.63 $213.13 -4.5% -$10.11 $210.89 -4.9% -$10.76 15 Fresno, CA $190.71 $201.55 $210.67 $212.95 15.4% $28.36 $204.68 10.6% $19.65 16 Kahului, HI $207.91 $196.76 $198.73 $210.61 10.2% $19.54 $203.23 9.5% $17.67 17 Monterey, CA $189.22 $200.78 $229.07 $210.29 12.9% $24.06 $207.76 10.5% $19.68 18 Kona, HI $198.41 $197.24 $190.51 $209.02 15.2% $27.64 $198.70 17.2% $29.09 19 Kauai Island, HI $179.87 $190.81 $191.36 $203.20 15.9% $27.86 $191.36 16.6% $27.24 20 Palm Springs, CA $191.03 $186.82 $192.01 $200.84 10.0% $18.23 $192.68 5.8% $10.61 21 Grand Junction, CO $180.36 $190.25 $185.04 $196.70 7.0% $12.90 $188.43 11.6% $19.57 22 San Francisco, CA $177.24 $198.40 $202.19 $194.16 10.1% $17.85 $193.76 13.1% $22.39 23 Durango, CO $180.01 $182.03 $187.70 $193.64 5.0% $9.17 $186.14 3.5% $6.31 24 Los Angeles, CA $181.77 $193.09 $198.30 $190.29 6.5% $11.62 $191.29 10.7% $18.54 25 Arcata/Eureka, CA $208.17 $202.84 $202.49 $186.96 -8.7% -$17.80 $199.53 4.8% $9.09 26 Colorado Springs, CO $182.78 $188.18 $184.90 $182.03 5.4% $9.30 $184.59 9.5% $15.98 27 Tucson, AZ $165.80 $175.51 $171.74 $178.45 7.5% $12.50 $172.90 7.7% $12.31 28 Salt Lake City, UT $172.06 $173.60 $180.87 $174.46 8.8% $14.15 $175.25 15.0% $22.87 29 San Diego, CA $159.17 $167.31 $171.02 $167.35 10.2% $15.45 $166.48 12.8% $18.87 30 Redding, CA $182.52 $181.51 $214.96 $166.11 -18.0% -$36.57 $186.31 -3.8% -$7.43 31 Phoenix, AZ $158.56 $163.01 $160.31 $165.65 11.7% $17.37 $161.93 12.3% $17.72 32 Albuquerque, NM $156.13 $164.48 $170.81 $165.12 9.0% $13.57 $164.56 11.8% $17.36 33 Santa Maria, CA $158.34 $152.33 $174.46 $162.43 3.0% $4.71 $162.20 -4.1% -$7.00 34 Orange County, CA $148.21 $159.15 $170.13 $161.95 16.4% $22.84 $160.13 14.8% $20.69 35 Bull. City/Laughlin, AZ $138.20 $139.00 $149.30 $158.30 11.1% $15.80 $144.82 10.8% $14.12 36 Sacramento, CA $144.04 $155.43 $162.72 $156.86 10.6% $15.05 $155.22 10.6% $14.89 37 Chico, CA $142.36 $151.13 $183.24 $152.99 14.3% $19.13 $156.52 25.6% $31.95 38 Reno, NV $154.36 $160.32 $166.08 $152.43 2.3% $3.50 $158.62 6.2% $9.29 39 Modesto, CA $148.79 $147.21 $202.68 $152.30 9.5% $13.24 $161.02 20.5% $27.37 40 San Jose, CA $138.10 $154.54 $158.54 $150.97 13.2% $17.64 $151.09 15.5% $20.32 41 Ontario, CA $142.39 $152.66 $160.30 $150.39 7.1% $9.98 $151.71 10.1% $13.97 42 Las Vegas, NV $146.13 $156.12 $151.16 $150.12 8.1% $11.28 $150.98 13.1% $17.45 43 Elko, NV $149.26 $150.69 $314.99 $148.19 10.1% $13.64 $177.76 30.3% $41.35 44 Denver, CO $142.23 $145.92 $150.00 $148.06 4.2% $6.00 $146.73 5.9% $8.23 45 Burbank, CA $125.36 $134.44 $140.57 $135.60 9.3% $11.49 $134.14 10.0% $12.22 46 Oakland, CA $124.97 $136.34 $140.72 $133.36 7.6% $9.44 $134.27 11.9% $14.30 47 Carlsbad, CA $144.43 $151.36 $179.38 $127.99 -9.2% -$12.95 $147.33 6.3% $8.77 48 Santa Rosa, CA $112.26 $124.33 $127.80 $120.24 5.4% $6.17 $121.68 4.9% $5.65 49 Long Beach, CA $107.16 $119.03 $117.90 $119.72 3.8% $4.39 $116.33 4.8% $5.36 50 Hilo, HI $98.54 $104.02 $103.71 $112.40 32.5% $27.55 $104.62 34.6% $26.89 51 Saipan, PT $111.94 $124.09 $128.30 $105.47 13.3% $12.39 $117.81 17.6% $17.65 52 Saint George, UT $100.55 $108.09 $233.37 $98.75 5.1% $4.83 $116.24 25.8% $23.83 53 Kapolua, HI $100.50 $98.73 $97.42 $96.52 -6.1% -$6.29 $98.27 4.0% $3.82 54 Lanai City, HI $100.90 $86.35 $83.30 $96.29 5.8% $5.24 $91.67 1.5% $1.35 55 Pueblo, CO $139.18 $158.87 $145.54 $93.68 -38.5% -$58.62 $120.90 -23.9% -$37.99 56 Mesa Gatew ay, AZ $96.41 $89.06 $76.88 $88.77 6.5% $5.41 $87.91 4.1% $3.45 57 Fort Collins, CO $58.13 $55.23 $49.90 $61.61 0.9% $0.52 $56.81 -2.6% -$1.53 58 Stockton, CA $48.01 $51.30 $38.98 $47.30 -5.0% -$2.49 $44.85 -4.8% -$2.28 59 Rota, PT $47.00 $51.70 $48.20 $45.00 -0.9% -$0.40 $47.89 4.1% $1.89 60 Hoolehua, HI $53.36 $48.41 $49.18 $43.12 -8.6% -$4.05 $47.84 6.6% $2.98 1 Q 10 2 Q 10 3 Q 10 4 Q 10 Average Regional Fare $160.30 $169.01 $172.28 $169.08 9.0% $13.94 $167.84 11.5% $17.29 YE/YE YE/YE 2010 Qtr/Qtr Qtr/Qtr Rank 1 Q 10 2 Q 10 Dec-10 3 Q 10 4 Q 10 % 

### ? Fare 

### ? % 

### ? Fare 

### ? 

## FIGURE 29 : Top 60 Southwest Region Markets Ranked by Domestic Fare Q4 2010; Source: US DOT Table OD1AMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 69 Airport

1 Rota, PT 63.86¢ 40.85¢ 59.08¢ 68.46¢ 0.3% 0.18¢ 55.94¢ -13.5% -8.75¢ 2 Hoolehua, HI 24.70¢ 31.42¢ 35.19¢ 39.37¢ 14.4% 4.97¢ 32.08¢ -1.3% -0.41¢ 3 Lanai City, HI 22.70¢ 27.28¢ 23.13¢ 26.67¢ 9.3% 2.26¢ 24.76¢ 3.9% 0.93¢ 4 Saipan, PT 23.52¢ 22.86¢ 22.86¢ 23.33¢ 0.4% 0.09¢ 23.12¢ -3.8% -0.91¢ 5 Aspen, CO 20.37¢ 20.52¢ 23.18¢ 21.88¢ 7.3% 1.49¢ 21.40¢ 8.0% 1.58¢ 6 Kapolua, HI 19.85¢ 21.51¢ 21.91¢ 21.14¢ -1.5% -0.32¢ 21.08¢ 3.6% 0.73¢ 7 Santa Rosa, CA 20.38¢ 21.99¢ 22.51¢ 21.14¢ 6.5% 1.29¢ 21.58¢ 8.9% 1.77¢ 8 Hilo, HI 17.67¢ 17.58¢ 17.99¢ 20.36¢ 25.5% 4.13¢ 18.36¢ 16.6% 2.62¢ 9 Eagle/Vail, CO 16.75¢ 20.22¢ 17.37¢ 20.17¢ 11.7% 2.11¢ 17.61¢ 13.9% 2.15¢ 10 Santa Fe, NM 17.29¢ 17.69¢ 19.00¢ 19.95¢ 8.1% 1.49¢ 18.51¢ 3.4% 0.61¢ 11 Rosw ell, NM 20.73¢ 20.64¢ 21.07¢ 19.74¢ 4.9% 0.92¢ 20.56¢ 1.1% 0.23¢ 12 Gunnison, CO 15.99¢ 18.63¢ 20.05¢ 19.30¢ 4.9% 0.90¢ 17.74¢ 19.9% 2.95¢ 13 Durango, CO 17.35¢ 17.31¢ 17.94¢ 18.87¢ 8.2% 1.42¢ 17.88¢ 4.0% 0.68¢ 14 Hayden, CO 13.91¢ 18.34¢ 18.94¢ 18.43¢ 4.7% 0.82¢ 15.58¢ 11.5% 1.61¢ 15 Grand Junction, CO 17.06¢ 17.09¢ 16.40¢ 18.30¢ 6.4% 1.09¢ 17.20¢ 8.1% 1.29¢ 16 Bakersfield, CA 15.76¢ 16.45¢ 16.33¢ 17.81¢ 15.8% 2.43¢ 16.64¢ 12.3% 1.82¢ 17 Flagstaff, AZ 14.54¢ 15.28¢ 15.86¢ 17.22¢ 21.0% 2.99¢ 15.77¢ 14.8% 2.03¢ 18 Yuma, AZ 16.06¢ 16.45¢ 16.72¢ 16.90¢ 7.8% 1.23¢ 16.53¢ 3.1% 0.50¢ 19 Montrose, CO 15.08¢ 16.97¢ 17.78¢ 16.87¢ 1.8% 0.30¢ 16.39¢ 12.4% 1.81¢ 20 Burbank, CA 16.18¢ 16.76¢ 16.57¢ 16.81¢ 10.3% 1.56¢ 16.59¢ 10.5% 1.58¢ 21 Santa Maria, CA 16.74¢ 15.62¢ 16.81¢ 16.59¢ -2.2% -0.38¢ 16.44¢ -6.7% -1.18¢ 22 Albuquerque, NM 15.40¢ 15.18¢ 15.47¢ 15.65¢ 7.9% 1.14¢ 15.42¢ 10.5% 1.47¢ 23 Colorado Springs, CO 15.39¢ 15.47¢ 15.31¢ 15.47¢ 4.8% 0.71¢ 15.41¢ 7.4% 1.06¢ 24 Salt Lake City, UT 14.73¢ 15.19¢ 15.63¢ 15.44¢ 5.7% 0.84¢ 15.24¢ 12.4% 1.68¢ 25 Elko, NV 17.30¢ 16.68¢ 29.82¢ 15.28¢ 1.7% 0.26¢ 18.95¢ 28.2% 4.17¢ 26 Pueblo, CO 22.46¢ 23.08¢ 24.29¢ 15.15¢ -41.7% -10.86¢ 19.33¢ -18.0% -4.24¢ 27 Arcata/Eureka, CA 17.87¢ 16.06¢ 15.40¢ 15.07¢ -4.8% -0.77¢ 15.99¢ 5.1% 0.78¢ 28 Fresno, CA 13.83¢ 13.90¢ 14.22¢ 14.75¢ 12.4% 1.63¢ 14.19¢ 7.8% 1.03¢ 29 Guam 15.66¢ 15.09¢ 15.43¢ 14.68¢ 3.0% 0.42¢ 15.22¢ 6.7% 0.95¢ 30 Palm Springs, CA 14.11¢ 14.14¢ 13.01¢ 14.67¢ 10.5% 1.39¢ 14.09¢ 5.0% 0.67¢ 31 Santa Barbara, CA 14.18¢ 13.52¢ 14.26¢ 14.67¢ 4.8% 0.67¢ 14.16¢ 2.5% 0.34¢ 32 Monterey, CA 13.55¢ 14.32¢ 15.53¢ 14.64¢ 8.6% 1.16¢ 14.55¢ 5.4% 0.74¢ 33 Oakland, CA 14.16¢ 14.47¢ 14.14¢ 14.58¢ 11.8% 1.54¢ 14.34¢ 14.2% 1.78¢ 34 Bull. City/Laughlin, AZ 12.01¢ 12.85¢ 14.48¢ 14.55¢ 9.4% 1.25¢ 13.22¢ 12.9% 1.51¢ 35 Reno, NV 13.64¢ 13.85¢ 14.75¢ 14.41¢ 1.6% 0.23¢ 14.16¢ 3.6% 0.49¢ 36 Tucson, AZ 13.41¢ 13.92¢ 13.82¢ 14.29¢ 5.2% 0.71¢ 13.86¢ 6.2% 0.81¢ 37 Denver, CO 13.52¢ 13.70¢ 14.02¢ 14.06¢ 3.5% 0.48¢ 13.84¢ 5.5% 0.72¢ 38 Orange County, CA 13.39¢ 13.53¢ 13.89¢ 13.83¢ 9.1% 1.16¢ 13.67¢ 11.0% 1.36¢ 39 San Luis Obispo, CA 12.37¢ 12.70¢ 14.07¢ 13.65¢ -3.6% -0.51¢ 13.26¢ -6.4% -0.91¢ 40 San Jose, CA 13.45¢ 13.71¢ 13.75¢ 13.65¢ 6.8% 0.87¢ 13.65¢ 11.4% 1.40¢ 41 Phoenix, AZ 13.18¢ 13.16¢ 13.28¢ 13.58¢ 10.4% 1.28¢ 13.30¢ 11.7% 1.39¢ 42 Stockton, CA 13.42¢ 14.29¢ 11.18¢ 13.52¢ -2.2% -0.31¢ 12.73¢ -3.0% -0.40¢ 43 Ontario, CA 13.51¢ 13.43¢ 13.49¢ 13.50¢ 3.4% 0.44¢ 13.48¢ 5.6% 0.71¢ 44 Sacramento, CA 13.29¢ 13.27¢ 13.21¢ 13.42¢ 5.5% 0.70¢ 13.29¢ 7.0% 0.87¢ 45 Kona, HI 11.49¢ 11.32¢ 11.33¢ 12.66¢ 4.8% 0.57¢ 11.69¢ 7.1% 0.77¢ 46 Saint George, UT 13.50¢ 13.17¢ 18.65¢ 12.60¢ -0.7% -0.09¢ 13.97¢ 17.5% 2.08¢ 47 Redding, CA 15.43¢ 14.91¢ 16.85¢ 12.32¢ -32.2% -5.84¢ 14.82¢ -14.6% -2.54¢ 48 Kauai Island, HI 11.08¢ 11.14¢ 11.37¢ 12.28¢ 4.9% 0.57¢ 11.46¢ 5.5% 0.60¢ 49 San Diego, CA 11.87¢ 12.15¢ 12.24¢ 12.19¢ 7.4% 0.84¢ 12.12¢ 10.7% 1.17¢ 50 San Francisco, CA 11.27¢ 11.99¢ 12.13¢ 11.99¢ 8.1% 0.89¢ 11.88¢ 11.8% 1.25¢ 51 Las Vegas, NV 11.70¢ 12.15¢ 11.81¢ 11.87¢ 6.9% 0.77¢ 11.89¢ 12.0% 1.27¢ 52 Los Angeles, CA 11.52¢ 11.81¢ 12.00¢ 11.84¢ 5.5% 0.62¢ 11.81¢ 9.9% 1.06¢ 53 Long Beach, CA 9.24¢ 10.48¢ 11.08¢ 11.75¢ 19.2% 1.89¢ 10.66¢ 12.9% 1.22¢ 54 Chico, CA 9.67¢ 10.84¢ 14.29¢ 11.32¢ 17.3% 1.67¢ 11.39¢ 23.0% 2.13¢ 55 Kahului, HI 10.57¢ 10.13¢ 10.20¢ 11.00¢ 0.0% 0.00¢ 10.46¢ 0.9% 0.09¢ 56 Modesto, CA 10.41¢ 10.38¢ 15.39¢ 10.85¢ 8.7% 0.87¢ 11.57¢ 20.3% 1.95¢ 57 Honolulu, HI 9.88¢ 9.97¢ 10.24¢ 10.71¢ 5.6% 0.57¢ 10.20¢ 6.8% 0.65¢ 58 Fort Collins, CO 9.26¢ 8.82¢ 7.97¢ 9.88¢ 1.6% 0.16¢ 9.08¢ -2.4% -0.22¢ 59 Carlsbad, CA 10.24¢ 10.46¢ 12.97¢ 8.91¢ -3.5% -0.32¢ 10.41¢ 7.3% 0.71¢ 60 Mesa Gatew ay, AZ 8.68¢ 8.05¢ 6.98¢ 8.41¢ 10.4% 0.79¢ 8.04¢ 3.9% 0.30¢ 1 Q 10 2 Q 10 3 Q 10 4 Q 10 $12.38 $12.59 $12.72 $12.82 Average Regional Yield 12.38¢ 12.59¢ 12.72¢ 12.82¢ 6.6% 0.79¢ 12.63¢ 9.4% 1.08¢ YE/YE YE/YE 2010 Qtr/Qtr Qtr/Qtr
% 

### ? Yld 

### ? Rank 1 Q 10 2 Q 10 Dec-10 3 Q 10 4 Q 10 % 

### ? Yld 

### ? 

## FIGURE 30 : Top 60 Southwest Region Markets Ranked by Domestic Yield Q4 2010; Source: US DOT Table OD1AMcClellan

- Palomar Airport • Small Community Air Service Development Grant Proposal • August 2, 2011 

# 70 CONCLUSIONS

McClellan

- Palomar Airport SCASD Program project is well thought out and ready to be put in place

. California Pacific Airline s is the cash partner in the application , committing $300,000 of its own money to the project. The Airline is committed to launching service in Carlsbad . An agreement will be final ized with the carrier as soon as the Grant is awarded. Moreover, this Grant will do much more than simply link a community to a new hub. It will help to launch a new airline and support a new base of operations in the small community the Grant is de signed to help

– adding as many as 500 new jobs in Carlsbad in the next five years.

McClellan

- Palomar Airport has seen continuous flight reductions over the last three years, resulting in almost a quarter fewer local available seats and
, ultimately, fewer passengers. Many markets can tell the same story. But the story in Carlsbad is punctuated by the fact that the flig ht reductions have drastically increased the region’s passenger “leakage” to other airports in
S

outhern California. The Airport retains just 1.6% of its local passengers. It loses more than 4,400 passengers per day each way to other airports in the region.

This is a more critical situation in S outhern California than in almost any other part of the country, due to the heavy congestion on virtually all freeways in and out of Carlsbad, at virtually all times of day. McClellan

- Palomar Airport must do a better job serving its 1.13 million person catchment area by attracting additional air
service.

The Airport feel s that C alif ornia Pacific Airlines should not be required to undertake this project
alone. The addition of five new non

- stop routes, a new start

- up carrier, and the Airport’s first jet service in years will be a tremendous boost to the Carlsbad region as a whole. For these

reasons, McClellan

- Palomar Airport is seeking Small Community Air Service Development Grant support for the project. 

# “ The Airport retains just 1.6% of its

local passengers. It loses more than 4,400 passengers per day each way to other airports...”