Leg al sponsor: Ventura County

DUNS: 066691122

Tax ID: 95

- 6000 944

Co ngressional District Code: CA

- 23

Contact: Jorge Rubio, CM, Airport s Manager

Address: 555 Airport Way, Suite B

Camarillo, CA 93010

- 8530

Phone: (805) 388

- 4246

Email: Jorge.Rubio@ventura.gov 

# O XNARD 

# A IRPORT A PPLICATION UNDER

THE 

# S MALL 

# C OMMUNITY 

# A IR 

# S ERVICE


# D EVELOPMENT


# P ROGRAM

Docket DOT

- OST

- 2012

- 0069Prepared byAPPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

# T **ABLE OF** 

# C **ONTENTS**

Application Highlights

................................ .............. 1

Lack of Air Service

................................ ............................. 1

Detailed Market Analysis

................................ ................... 2

Community Cost Contribution

................................ ............ 2

Public

- Private Partnership

................................ ................. 2

Material Benefits

................................ ................................ 2

Use of Funds in a Timely Fashion

................................ ..... 2



### Air Service Environment

................................ .......... 3

Market Reach and Potential

................................ .............. 3

Large and Diverse Employers

................................ ........... 4

Military Presence

................................ ............................... 5

Tourism

................................ ................................ ............. 5



### Air Service

– Existing and Historical

....................... 6

Historical Air Service

................................ ......................... 6

Destinations, Service Providers and Traffic Levels

.... 7

Extenuating Factors that have Affected Air Service

... 8

Past Air Service Development Efforts

................................ 8



### Air Service Needs and Deficiencies

........................ 9

High Catchment Area Demand, No Service

...................... 9

Local, Convenient Access

................................ ............... 10 

### Strategic Plan

– Air Service

................................ .... 11

Project Goals

................................ ................................ ... 11

Proposed Air Service

................................ ....................... 11

Airline Participation

................................ .......................... 12

Market Analysis

................................ ............................... 12

Forecast Assumptions

................................ .............. 12

Mature Market Results

................................ ............. 12

Airline Risk During Ramp

- Up

................................ ... 12

Alternate Pla n

................................ ................................ .. 13



### Strategic Plan

– Implementation and

Funding

................................ .............................. 14

Public

- Private Pa rtnership

................................ ............... 14

Incentive and Support Plan

................................ ............. 15

Marketing Campaign

................................ ................ 16

Revenue Guarantee

................................ ................. 16

Airline Travel Bank®

................................ ................ 16

Fee Waivers

................................ ............................. 17

Strategic Plan Funding

................................ .................... 17

Project Continuation and Sustainability

........................... 18



### Schedule and Monitoring

................................ ....... 19

Milestones for Timely Completion of Project

................... 19

Strategic Plan Monitoring Program

................................ .. 20



### Appendix A. Community Support

......................... 21

Government

................................ ................................ ..... 21

Public

- Private Partnership

................................ ............... 21

Businesses and Organizations

................................ ........ 21P AGE 1APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

# A **PPLICATION** 

# H **IGHLIGHTS**

his Small Community Air Service

Development Program (SCASDP) grant

application for Oxnard Airport (OXR) meets

the criteria of Docket DOT

- OST

- 2012

- 0069.

The County of Ventura Department of Airports, the

airport sponsor, is requesting $500,000 in federa l

assistance to implement a $ 993,013 air

service initiative.

The project goal is to re

- introduce air service at

OXR in order for catchment area passengers to

access the national air transportation system. Re

introduction of air service is the region’s top priority.

The Strategic Pla n, Alaska Airlines service to the

San Francisco Bay Area , will achieve the

project goal.



### Lack of Air Service

The lack of air service at OXR has led the community to drive to surrounding airports in order to

access the national air transportation system. OXR’s last carrier, United Express operated by

SkyWest Airlines, ended service in mid

- 2010. OXR has an estimated true market of over 1,080,000

origin and destination passengers annually; however, with the lack of air service at OXR, all of those

passengers must travel to other airports. Local Ventura County companies highly prefer to originate

travel at OXR especially with the uncertainty of drive times associated with traveling to Burbank’s

Bob Hope Airport (BUR) or Los Angeles International Airport (LAX) to start their travels. New

competitive service to the San Francisco Bay Area will reduce passenger diversion for OXR’s top

priority destinations. 

# TP AGE 2APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

### Detailed Market Analysis

The research and analysis necessary to determine the viability of OXR

- San Francisco Bay Area service

has been completed. The route forecast is positive

, and feedback from Alaska has been encouraging.

However, an incentive package to mitigate the start

- up year’s risks will be required. Accordingly, OXR and

its partners have creat ed an incentive package as part of the Strategic Plan that addresses the economic

risks that Alaska will face during start

- up.



### Community Cost Contribution

It is estimated that a $500,000 revenue guarantee, $100,000 one

- year marketing program, Airline Travel Bank ® , and fee

waivers will be required for twice daily, roundtrip service to the San Francisco Bay Area

. OX R and the community will fund 50

percent of the proposed $993,013 Strategic Plan. Non

- airport revenue sources will fund eight percent ($50,000) of the $595,000

cash requirement.



### Public

- Private Partnership

The County of Ventura/OXR has formed a p ublic

- private partnership with eight private partners: Economic Development of

Oxnard, Gold Coast Broadcasting, KCLU Radio, Oxnard Chamber of Commerce, Oxnar d Convention & Visitors Bureau,

Ventura Chamber of Commerce, the Ventura Convention and Visitors Bureau , and the Ventura County Lodging Association

. This partnership has worked together in the past to improve air service at OXR.



### Material Benefits

OXR is important to the future economic prosperity of Ventura County, and its importance will continue to increase if air service

is reintroduced . Within OXR’s catchment area are several major employers including a number of Fortune 1000 companies.

Ventura County is also home to a significant military presence at both the US Navy Base Ventura County Point Mugu and the

Navy’s SeaBees at Port Hueneme. With combined personnel of nearly 15,000, the US Navy has a critical need for local air

service access

. A link betwe en OXR and the San Francisco Bay Area will help meet the needs of these sectors.



### Use of Funds in a Timely Fashion

The public

- private partnership has a solid schedule and strategic plan to ensure timely use of the funds. Meetings have been

held with Alaska in anticipation of this grant application, and the route is under consideration. 

### Currently OXR

**- San** 

**Francisco Bay Area**

**service is under**

**revie w by Alaska** 

**Airlines, and they**

**continue to**

**express interest.**P AGE 3APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

# A **IR** 

# S **ERVICE** 

# E **NVIR ON**  **MENT**

XR is a county

- owned

, non

- primary airport serving Ventura Coun t y. OXR is vital to the

economic future of Ventura County, and its importance will continue to increase with the

reintroduction of air service and area economic growth . This section shows the broad

segment of the traveling public, including businesses, military and other enterprises that will benefit

from the proposed Strategic Plan.



### Market Reach and Potential

OXR has a large clo se in population compared to

many airports without air service. Within a 25

- mile

radius is a population of approximately 685,000;

expanded to 50 miles the population increases to

over 3.5 million. OXR’s primary catchment area,

shown in Exhibit 2.1 , has a p opulation of almost

605,000 residents.

Population is expected to grow 12 percent from

2012 to 2020, while household income is

anticipated to grow by 35 percent. Comparatively,

the state of California population and the national

average is projected to gro w by eight percent. 

# O

EXHIBIT 2 .1 AIRPORT CATCHMENT AREAP AGE 4APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT Since OXR lost air service in 2010, all of its estimated 1,086,000 travelers divert from the area and use

other surrounding airports including BUR

, LAX , Orange County and Santa Barbara. Table 2.1 shows an

estimated drive time from the Oxnard community to each of these airports. The primary diversionary

airport is LAX with 74 percent of the catchment area making the 60 plus mile trip . The Oxnard

- Los

Angeles drive can be upwards of two hours in rush hour traffic. At a reimbursable rate of 55 .5 cents per
mile, this is costly to local businesses adding almost $70 per trip and loss of employee productivity.

TABLE 2 .1 DRIVE TIME TO ALTERNATE AIRPORTS

DIVERSION

AIRPORT MILES ESTIMATED

DRIVE TIME % DIVERSION

FROM OXR

Burbank 56 1.3 hours 15
Los Angeles 63 1. 5 hours 74
Orange County 102 2.0 hours 6

Santa Barbara 48 0.9 hours 5



### Large and Diverse Employers

The OXR catchment area has a dynamic and growing local business community with significant air travel demand. Within OXR’s

catchment area are several major employers with extensive travel requirements. Ventura County is home to a number of

Fortune 1000 companies including: Kellogg Company, Whirlpool Corporation, Stryker Corporation, Parker Hanni fin, Pfizer and

Eaton Corporation. A few of the companies are highlighted below.

• : Amgen’s headquarters is in Ventura County and closer to OXR than alternate airports. Amgen is the world’s Amgen

largest independent biotechnology firm.

• Bank of Am erica

• : Well Point’s California operations are headquartered in Ventura County. Well Point operates the Blue Well Point

Cross Blue Shield of California.

• : Diverse bioscience manufacture r that operates a division in Ventura County. Baxter Bioscience

• Fa rmers Insurance

Availability of scheduled commercial air service at OXR will enhance future regional economic development eff orts. Ventura

County companies, including the Fortune 1000 corporations listed above, rely on commercial air transportation in order to

conduct business in our global economy.P AGE 5APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

### Military Presence

Reinstating air service at OXR will benefit the military facilities

throughout the Ventura County area. There are more than 20,000

active duty military and civilian contractors located at the two Naval

installations within Ventura C ounty: Naval Base Ventura County Point

Mugu and Naval Base Ventura County Port Hueneme.

• : Naval Air Station Point Mugu is home to Point Mugu

numerous Naval Squadrons including Airborne Command

Control and Logistics Wing, Air T est and Evaluation

Squadrons 9 and 10, and the Fleet Logistics Support

Squadron 55. Point Mugu is also home to the Naval Air

Warfare Center Weapons Division as a major testing center

for new Naval weapons. The more than 19,000 military and

civilian personnel on the base support over 10 0 individual

military commands at Point Mugu.

• : Port Hueneme is the West C oast home to Port Hueneme

the Naval Construction Battalion, or more commonly referred

to as SeaBees. The 2,600 active duty personnel support the

US Navy worldwide with their specialized skill set.



### Tourism

Tourism is one of California’s major industries. Successful tourism initiatives in Ventura County require that travelers have the

ability to move in and out of the region efficiently and cost effectively. Air service improve ments at OXR will help attract more

visitors to the area for meetings, vacations and conferences. The following is a list of just some of the events and attracti ons
drawing visitors to Ventura County.

• : Located just off the co ast of Ventura County, the Channel Islands National Park Channel Islands National Park

offers tourists a significant amount of recreational activities including hiking, sailing, diving, and sightseeing boat tours

.

• : Established in 1782, this is one of the oldest Spanish missions in California. San Buenaventura Mission

• : As with much of the California central coast, the Ventura County area is home to many wineries and the Wineries

draw of tourists to them is increasing

. 

### Significant Military

Presence

There are more than 20,000 active duty military and civilian

contractors located at

the two Naval

installations within

Ventura Cou nty

.P AGE 6APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

# A **IR** 

# S **ERVICE**



# – **E XISTING AND** 


# H **ISTORICAL**

XR does not have existing air

service. However, t his section

provides an overview of historical

air service at OXR. The most recent

carriers providing service, service

frequency, nonstop destinations and

equipment types are included in the

discussion. A summary of hi storical air

service is also included with destinations,

traffic levels, service providers, and an

overview of extenuating factors that have

affected air service. A description of air

service de velopment efforts concludes the section.



### Hi storical Air S ervice

In 2001, OXR had service to two hub airports , LAX (United) and Phoenix (America West). O ver the

course of the next decade , despite steady increases in population and a stable economy, the number

of airlines, hub airports, flights and seats decreased unt il they were eliminated in 2010 . The effects of

September 11, 2001, and the fuel increases in 2008 , that caused a dramatic increase in airfares over

what were available in the past, reduced the number of passe ngers below a sustainable level

.

This sub section summarizes OXR’s air service history including: destinations, traffic levels, and

service providers. Extenuating factors that have affected air service over time is also reviewed. 

# OP AGE 7APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

### Destinations, Service Providers and Traffic L evels

Annual onboard passengers decreased

throughout the decade from 2001 despite

population growth of approximately nine

percent since 2000. Exhibit 3 .1 shows the

significant decrease in onboard passengers

, departures and seat capacity that OXR

experience d prior to air service ceasing in

2010. OXR ’ s passenger decline was largely

due to decreasing seat capacity, reduction in

frequency and high fares compared to

competing airports.

Table 3 .2 provides average weekly departures

and seats by destination and airline from 2000

through 2010. In 2000, OXR had 42 weekly

departures and 1,260 average weekly seats. In

2001, OXR service peaked with United and

America West serving the market. Triggered by

the events of September 11, 2011, departures

and seats gradually declined until all service

was terminated in 2010

.

TABLE 3 .2 HISTORICAL DESTINATIONS AND SERVICE PROVIDERS

DESTINATION AIRLINE ITEM MONTH OF JULY

2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010

Los Angeles United Dept 42 35 34 35 35 34 31 26 25 25

- Seats 1,260 1,050 1,020 1,050 1,050 1,020 930 780 750 750

-

Phoenix America West Dept

- 14

- - - - - - - - - Seats

- 518

- - - - - - - - - Average weekly departures 42 49 34 35 35 34 31 26 25 25

- Average weekly seats 1,260 1,568 1,020 1,050 1,050 1,020 930 780 750 750

-

Source: Diio Mi 

### Onboard Passengers

From 2001, a nnual onboard passengers

decline d until service

ceased in 2010

. EXHIBIT 3.1 HISTORICAL DEPARTURES , SEATS AND

ONBOARD PASSENGERS

Source: Diio Mi 0 20,000 40,000 60,000 80,000 100,000 120,000

0 500 1,000 1,500 2,000 2,500 3,0002001200220032004200520062007200820092010Seats/Onboard PassengersDepartures

Calendar year Departures Seats EnplanementsP AGE 8APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

### Extenuating Factors that have A ffected A ir S ervice

W ith a catchment area population of over 600,000 augmented by military installations and major facilities of Fortune 1000

companies, there is a dire need for convenient air transportation access to serve existing demand and support further economic

development. The demise of OXR’s previous air service was due to factors that were only partially related to market demand.

Phoenix service had a short life span and was discontinued in the aftermath of the wrenching changes in air service that

occurred after September 11, 2001. The LAX service fell victim to unfavorabl e economics of short haul flights, particularly those

under 100 miles. Such flights are totally dependent on lower yielding connecting traffic since there is no local market demand.

The continually escalating fuel costs since September 11, 2001, while affe cting all airline operations have been especially

devastating to the less efficient short flight segments. As the cost of flying between OXR and LAX increased disproportionately

, OXR fares increased rapidly. Catchment area demand reacted by opting to drive to surrounding airports such as LAX and BUR

where much lo w er fares were available.



### Past Air Service Development E fforts

OXR has taken a proactive approach to improving air service.

OXR’s marketing plan contains a number of initiatives related to

increasing the use of OXR when there was air service, as well as

efforts taken over the past few years since air service ceased. OXR

has worked to fill the three main air service needs during this time:

1. Add new routes and improve service w ith existing and

new carriers

2. Work to lower air fares with incumbent carrier

3. Reintroduce air service at OXR

Table 3.3 provides an overview of the air servic e devel opment

efforts since 2009

. TABLE 3.3 PAST AIR SERVICE DEVELOPMENT EFFORTS

YEAR INITIATIVE

2009 Hired air service development consultant

Advertising campaign; radio and print

Completed Passenger Booking Analysis

Completed route forecast

Attended Network USA conference

Attended ACI

- NA’s Jumpstart® conference

2010 Attended Network USA conference

Attended ACI

- NA’s Jumpstart® conference

Hired air Service development consultant

Created airport incentive program

Attended airline headquarters meetings

Applied for SCASDP grant to re

- instate service

2011 Attended Network USA conference

Attended ACI

- NA’s Jumpstart® conference

Coordinated with local Lodging Association

2012 Hired new air service development consultant

Attended Network USA conference

Attended ACI

- NA’s Jumpstart® conference

Completed True Market Estimate

Completed route analyses for new serviceP AGE 9APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

# A **IR** 

# S **ERVICE** 

# N **EEDS AND**


# D **EFICIENCIES**

he Air Service Needs and Deficiencies section identifies the issues at OXR. This section

provides detailed analyses to demonstrate that Ventura County is underserved and in need of

access to the national air transportation system.



### High Catchment Area Demand, No Service

OXR and its catchment area with no scheduled commercial air service

qualif y as a poster child for underserved markets. A Passenger Demand

Analysis (i.e. retention/diversion study) based on booking data and US

Department of Transportation (DOT) reported origin and destination data

when air service was most recently available produ ces an estimated true

market of over 1 million annual passengers to/from the OXR catchment area

(refer to Table 4.1 ).

The previous OXR service with very short flights to LAX and an absence of

local LAX passengers resulted in the market being overpriced, a major factor

in the discontinuation of the OXR service. The inability of OXR to sustain its

previous service was a function of correctable negative factors rather than

the inadequacy of catchment area d emand. However, since the market was

not Essential Air Service eligible, OXR must re

- establish its market viability.

T his can best be done by establishing service to the San Francisco Bay Area

which is the OXR catchment area’s largest market. San Francis co is the

number one market for the OXR catchment area, and other San Francisco

Bay Area airports are also within the top 10. There is an estimated 167,359

annual passengers resulting in a defined need for nonstop air service from

OXR to the San Francisco Bay Area

. While the service does not address all

of the market ’ s air service needs, it provides service in the biggest local 

# T

TABLE 4.1 OXR TRUE MARK ET ESTIMATE

RANK DESTINATION DIVERTING PAX TRUE

MARKET LAX BUR OTHER

1 San Francisco, CA 64,581 13,317 8,211 86,110

2 Denver, CO 53,545 7,093 7,440 68,078

3 Chicago, IL (ORD) 43,358 1,188 6,824 51,370

4 Las Vegas, NV 41,352 4,353 4,331 50,037

5 Oakland, CA 15,812 26,071 4,953 46,836

6 Seattle, WA 23,525 9,973 8,033 41,532

7 San Jose, CA 2,966 26,232 5,214 34,413

8 Phoenix, AZ (PHX) 12,054 12,618 4,831 29,504

9 Washington, DC (IAD) 27,598 376 1,117 29,090

10 Sacramento, CA 7,877 12,862 5,065 25,804

11 Honolulu, HI 21,299 73 235 21,607

12 Salt Lake City, UT 13,322 4,505 2,409 20,235

13 San Antonio, TX 18,539 487 1,110 20,137

14 Dallas, TX (DFW) 14,301 3,156 2,518 19,975

15 Portland, OR 9,406 5,959 4,225 19,590

Total Domestic 723,635 169,425 111,838 1,004,897

Total International 79,007 285 2,301 81,594

Total OXR Catchment Area 802,642 169,709 114,139 1,086,491P AGE 10APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT market and connecting opportunities in major Pacific Northwest markets. Connecting opportunities would be

available in transpacific markets and major eastbound markets. Success of the service to the San Francisco

Bay Area provides validation of the OXR market and a foundation for future air service initiatives that will

more full y address catchment area needs.



### Local, Convenient Acce ss

Although there are many nonstop flights daily from BUR and LAX to the San Francisco Bay Area , it is

inconvenient to drive, especially due to inconsistent traffic delays on the highway system. Drives that can be

made without traffic congestion in 75 minu tes regularly take 120 minutes or more with traffic. At the 2012

IRS allowed automobile expense of 55 .5 cents per mile, it costs local travelers approximately $70 in direct

expenses to travel to/ from Oxnard to LAX. With the inclusion of time for these trav elers, there is a significant

expense that is born locally by not having access to the national air transportation system.P AGE 11APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

# S **TRATEGIC** 

# P **LA N** 



# – **A IR**  

# S **ERVICE**

he Strategic Plan proposed by OXR will achieve the

community’s goals and reduce its air service

deficiencies. This Strategic Plan section provides a

detailed description of the goals of the project and a

primary and alternate plan for attaining those goals.



### Project Goals

The project goal of this SCASDP grant application is to re

establish air servic e from OXR by targeting service to its

largest and highest priority market, the San Francisco Bay

Area , thereby allowing the local community access to the

national air transportation system. By meeting this goal the

cost and inconvenience for local travele rs will be reduced

and the need for air travelers to drive to other airports to

access air service will be mitigated. Market success will also

establish the viability of the OXR catchment area and

provide the foundation for future air service growth as

dem and increases.



### Proposed Air Service

The lack of needed air service at OXR forces air travelers to drive on congested, delay

- prone
highways to BUR or LAX. Without access to the national air transportation system, OXR is forced to

rely on this drive which i mpacts economic development. To counter these issues and provide

Ventura County access to the national air transportation system, the Strategic Plan is to add nonstop

service to the San Francisco Bay Area, the highest demand market for air travel out of th e OXR

catchment area 

# TP AGE 12APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

### Airline Participation

In recent years, OXR has engaged in discussions with Alaska Airlines regarding improving overall service

and adding nonstop service to the San Francisco Bay Area . Recent di scussions with Alaska have

been positive

.



### Market Analysis

A financial analysis and route forecast have been developed for Alaska service to San Francisco

International Airport. The public

- private partnership understands and agrees with the US DOT that a

thorough understanding of the target mark et is essential for the success of new air service. Results of the

Alaska service analysis is summarized below.



### Forecast Assumptions

A route forecast was completed for a two roundtrip schedule on a 76

- s eat Bombardier Dash

- 8

- Q400. The primary market

assumption was that Alaska will capture a share of the passengers that are driving to competing airports (i.e. BUR and LAX) to

travel to the San Francisco Bay Area and cities beyond San Francisco. The analysis utilized a Quality of Servi ce Index (QSI)

ratio for the nonstop service to San Francisco with driving to BUR or LAX and is based on the number of reasonable

connections available in the market.



### Mature Market Results

Table 5.1 provides a summary of the Alaska San Francisco market analysis for

two roundtrips per day on Bombardier Dash 8

- Q400 aircraft. Passenger

projections were based on a mature market (i.e., passenger projections would

be at 100 percent on the first day of serv ice). It is estimated that two roundtrips

per day will generate $7.4 million in annual revenue for Alaska, while having a

projected segment profit of over $900,000 for a 12 percent profit margin.



### Airline Risk During Ramp

- Up

It is estimated that Alaska wi ll earn a system profit of over $900,000 after the market matures. Although this market is projected

to be self

- sustaining in the long

- run, Alaska will not generate this amount of revenue or margin at start

- up. Airlines typically incur

losses in new market s during the ramp

- up period in the first year of service . Adding to initial economic risk in the market is the TABLE 5.1 OXR

- SAN FRANCISCO

MARKET ANALYSIS

ITEM STATISTICAL CATEGORY MATURE

MARKET

1 Seats per departure 76

2 Segments per day 4

3 Onboard Passengers 71,098

4 Load Factor 64%

5 Average Fare (all markets) $116.10

6 Segment revenue $7,444,478

7 Segment profit $909,294

Source: Mead & Hunt, Inc.P AGE 13APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT challenge of changing existing travel habits and airline allegiance which will take time. This could cause a longer than norm al

ramp

- up period an d lead to significant losses in the short

- term.

Table 5.2 provides an adjustment to passenger

projections to account for ramp

- up to a fully mature

market and breaks down the passenger projections for

the first 12 months. At service initiation, it is

conservatively estimated that Alaska will realize 60

percent of the potential revenue in a mature market

and mature throughout the first nine months of service

. The ramp

- up period is highly dependent on service

awareness and the community’s support of the new

service. Table 5 .2 also provides the estimated loss by

mont h and in total for the first 12 months of service.

OXR

- San Francisco segment revenues adjusted for

the ramp

- up period for the first year of service total

$6.02 million. The total shortfall is expected to

be $514,464

.



### Alternate Plan

If OXR fails to obtain Alaska service to San Francisco or another San Francisco Bay Area airport, alternate carriers will be

approached with the intent of obtaining nonstop service to the San Francisco Bay Area or another hub that would provide

access to the national air transp ortation system. Alternate carrier service to another hub would fulfill the goals of this grant

application of re

- establishing air service. TABLE 5 .2 SERVICE RAMP

- UP

MONTH SEASON

ALITY RAMP

UP LOAD

FACTOR REVENUE COST

PER

MONTH NET

SURPLUS/

SHORTFALL

Apr

- 13 8.22% 60% 38% $366,985 $537,138 ($170,153)

May

- 13 8.43% 64% 41% $401,592 $555,043 ($153,451)

Jun

- 13 8.85% 68% 47% $448,085 $537,138 ($89,054)

Jul

- 13 9.04% 72% 49% $484,361 $555,043 ($70,682)

Aug

- 13 8.82% 76% 51% $499,100 $555,043 ($55,943)

Sep

- 13 8.10% 80% 51% $482,645 $537,138 ($54,493)

Oct

- 13 8.27% 84% 52% $517,056 $555,043 ($37,987)

Nov

- 13 8.22% 88% 56% $538,658 $537,138 $1,519

Dec

- 13 8.23% 92% 57% $563,887 $555,043 $8,844

Jan

- 14 7.83% 96% 57% $559,734 $555,043 $4,691

Feb

- 14 7.76% 100% 61% $546,098 $501,329 $44,769

Mar

- 14 8.23% 100% 62% $612,518 $555,043 $57,475

Total 100.00% N/A 52% $6,020,719 $6,535,183 ($514,464)

Source: Mead & Hunt, Inc. 

### Strategic Plan
The Strategic Plan is

critical in Alaska’s

decision whether or

not to serve OXR.P AGE 14APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

# S **TRATEGIC** 

# P **LAN**



# – **I**

**MPLEMENTATION AND** 

# F **UNDING**

his section, Strategic Plan

- Implementation and

Funding, provides the detailed incentive and support

plan required to implement the Strategic Plan. A

legal sponsor responsible for administering the program has

been designated, and a public

- private partnership has been

formed to actively participate in implementi ng the proposed

project. In addition, this section identifies self

- sufficiency of

the service as an integral part of the community’s goals and

provides a description of the community’s plan to continue

with the project if it is not self

- sustaining after th e grant

award expires. A detailed description of the funding

necessary for implementation of the Strategic Plan,

including federal and non

- federal contributions, is included.



### Public

- Private Partnership

The Ventura County Department of Airports, the owner/ sponsor of OXR, has been designated as the

sponsor of this grant application. Ventura County has formed a public

- private partnership with eight

private entities. Private partners in the public

- private partnership include:

• Economic Development Corporation of Oxnard

• Oxnard Chamber of Commerce

• Oxnard Convention and Visitors Bureau

• Ventura Chamber of Commerce

• Ventura Visitors and Convention Bureau

• Gold Coast Broadcasting

• KCLU Radio

• Ventura County Lodging Association 

# TP AGE 15APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT Collectively, the partnership is committed to completing the Strategic Plan

(refer to community support letters in Appendix A ). All partners in the

public

- private partnership will be fully involved in the executio n of the

Strategic Plan ( Table 6 .1 ). The Ventura County Department of Airports will

execute all federal grant offers, process all associated reimbursement

requests and oversee grant administration. The Ventura County

Department of Airports will also administ er the revenue guarantee. Private

partners will be responsible for administering the $100,000 marketing

campaign and the Airline Travel Bank ® in conjunction with OXR . Together

these partners form a team committed to reinstating air service at OXR.



### Incentive and Support Plan

In today’s airline environment, community support packages have become increasingly important and virtually required for most

new service. To be effective, support packages must be structured to address the issues of new airline entry and ensure that the

market responds quickly. The public

- private partnership proposes a community support package that has been tested and

proven to be successful. To reduce Alaska ’s breakeven period and offset the risk during start

- up, the public

- pri vate partnership

proposes the following incentives (refer to Exhibit 6 .1 ): marketing campaign (create service awareness for the Alaska San

Francisco service); revenue guarantee (reduce airline risk); Airline Travel Bank ® (create service awareness and reduc e airline

risk); and fee waivers (reduce airline start

- up costs).

EXHIBIT 6.1 AIR SERVICE INCENTIVE PLAN TABLE 6.1 PUBLIC

- PRIVATE PARTNER ROLES

PUBLIC

- PRIVATE

PARTNER ROLE

Ventura County Department of Airports/OXR Grant and revenue
guarantee

administration and

assist with the local

marketing efforts

Private Partners Coordination of the marketing program and

Airline Travel Bank® ;

Assist with local marketing effortsP AGE 16APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

### Marketing Campaign

A marketing campaign must be targeted toward

aggressive promotion of the service to make the

new service successful and sustainable. Table

6.2 provides the marketing budget for the first

year of service. OXR has established an

extensive partnership agreemen t with many

media outlets. This $100,000 marketing

campaign will be funded by non

- airport sources

($50,000 cash and $50,000 in

- kind).



### Revenue Guarantee

To reduce airline risk and provide incentive for nonstop San Francisco Bay Area service , this Strategic Plan includes a revenue

guarantee as part of the community support package. Although pro forma projections for San Francisco service are positive,

service ramp

- up and breakeven can take up to 12 months, particularly in a market with significant barriers

- t o

- entry. It is

anticipated that Alaska would require at least a $500,000 revenue guarantee to initiate service to San Francisco.



### Airline Travel Bank®

To aggregate the support of the business community, change existing travel habits including frequent flyer loyalty programs, and

reduce the airline’s breakeven period, the public

- private partnership will commit to the creation of a $250,000 Airline Travel

Bank®. An Airline Travel Bank® is a money

- in

- the

- bank financial commitment of a business community to support a specific air

service initiative for a specified period. Unlike subsidies or pledges that do not guarantee that new service initiatives wi ll be

used by the flying public, the Airline Travel Bank® guarantees that travelers will use a specific ai r service offering by securing a

“use

- it

- or

- lose

- it” financial commitment. The strength of the Airline Travel Bank® concept is the broad

- based financial

commitment of the business community. It is a simple, logical program that communities and airlines se em to like

.

The public

- private partnership will use Mead & Hunt’s proven Airline Travel Bank® program. Over the last 10 years, Mead &

Hunt has implemented multiple successful programs including the Pensacola

- Atlanta AirTran Airways program that finished w ith

$2.1 million and 219 participating companies. The Eugene, OR business community has supported three Airline Travel Bank®

programs in recruiting service to Los Angeles, Phoenix, and Salt Lake City. These are just some of the examples of the

successful programs using this method. This is not a pledge program, an Airline Travel Bank® locks in the community financial

commitment that pledges lack. TABLE 6.2 MARKETING BUDGET

MEDIA OUTLET Year 1

TOTAL CASH IN

- KIND
Newspaper/Magazine $25,000

- $25,000

Radio

- $20,000 $20,000

Outdoor $10,000 $20,000 $30,000

Production $10,000

- $10,000

Internet/direct mail $5,000 $10,000 $15,000

Total $50,000 $50,000 $100,000P AGE 17APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

### Fee Waivers

The air service support program includes a waiver of landing

fees, terminal rents, and overnight parking fees. Table 6 .3

provides a summary of estimated fees that would be waived

for Alaska, total ing $9 8,013

.



### Strategic Plan Funding

The public

- private partnership is requesting US DOT assistance in funding 50 percent, or $500 ,000, of the Strategic Plan.

Specifically, US DOT funding will be used to fund the revenue guarantee. OX R and the community will fund 50 per cent of the

total proposed air service program. Non

- airport funding sources will provide eight percent of the cash requirement and 35

percent of the funding for the total program including in

- kind services ( Table 6 .4 ).

TABLE 6.4 STRATEGIC PLAN BUDGET

DESCRIPTION FUNDING SOURCE

TOTAL US DOT AIRPORT NON

- AIRPORT

CASH CASH IN

- KIND CASH IN

- KIND

Airline incentive program:

Marketing campaign

- - - $50,000 $50,000 $100,000

Revenue guarantee $500,000

- - - - $500,000

Airline Travel Bank®

- - - - $250,000 $250,000

Fee waivers

- - $ 98,013

- - $9 8,013

Monitoring program

- $30,000

- - - $30,000

Airline meetings/negotiations

- $15,000

- - - $15,000

Total $500,000 $45,000 $9 8 ,0 13 $50,000 $300,000 $ 993,013

Percent of total project 50 % 5% 10 % 5% 30% 100%

Percent of cash contribution 84% 8% N/A 8% N/A 100% TABLE 6.3 ESTIMATED FEE WAIVERS

C ATEGORY CALCULATION VALUE

Landing Fees $1.30 x 64.5lbs gtow x 730 flts $ 61,211

Terminal Rents $1.37 sq. ft. x 120 sq. ft. x 12 mo. $1,973

Office Space $1.10 sq. ft. x 110 sq. ft. x 12 mo. $1,452

Baggage Make Up $0.55 sq. ft. x 420 sq. ft. x 12 mo. $2,772

Overnight Parking $1.30 x 64.5lbs gtow x 365 $ 30,605

Total Estimated Fees Waiver $ 98,013P AGE 18APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

### Project Continuation and Sustainability

Based on the positive pro forma projections for Alaska service to San Francisco, it is anticipated that

service will be self

- sustaining after the start

- up period which can take up to 12 months or more. However,

the public

- private partnership understands that service failure is often due to the lack of awareness in the

community. Should the revenue guara ntee have remaining funds, the public

- private partnership will use

up to $100,000 for on

- going marketing of the San Francisco route. The Oxnard business community and

the public

- private partnership understand the economic importance of this project to the region and the

challenges associated with profitably operating air service to the Oxnard market and wi ll work to ensure

its long

- term success.P AGE 19APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

# S **CHEDULE AND**  

# M **ONITORING**

he public

- private partnership has

developed a realistic timetable for

achieving the project goals. This

section provides critical milestones to be

achieved by the public

- private partnership

to timely execute this air service initiative.

A monitoring program is also provided to

track the progress of the project.



### Milestones for Timely

Com pletion of Project

T arget dates are proposed in Table 7.1 to track the progress of this air service initiative assuming a

grant award by December 31, 201 2.

TABLE 7 .1 STRATEGIC PLAN SCHEDULE

DATE ACTION ITEM DESCRIPTION

January 1, 2013 Marketing campaign
development Development of the marketing campaign will be
completed in January 201 3 in order to begin the
marketing campaign 60 days pr ior to new service.

February 1, 201 3 Marketing initiation It is anticipated that the marketing campaig n will
begin by February 1, 2013, and continue throughout the first year of new service.

April 1, 2013 Service initiation The service start date is the critical date for the rest of the Strategic Plan. It is anticipated that Alaska wi ll
initiate nonstop service in April 2013

. Air service
initiation is dependent on airline route planning,

economics a nd availability of aircraft for OXR

.

June 30, 2013 Alternate plan If Alaska has not committed to a date to implement

nonstop San Francisco Bay Area service by June

30, 2013

, OXR will contact other airlines.

March 31, 2014 Revenue guarantee
contract completion At the end of the first year of service, the revenue
guarantee will be calculated. T he revenue guarantee

contract term will be based on the service start date. 

# TP AGE 20APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

### Strategic Plan Monitoring Program

The monitoring program includes service performance tracking, assessing the effectiveness of the marketing campai gn, tracking

airfares and determining the influence of new service on retention at OXR

. Table 7 .2 provides th e action items and frequency to

monitor the Strategic Plan over a one

- year period.

TABLE 7 .2 STRATEGIC PLAN MONITORING

FREQUENCY ACTION ITEM DESCRIPTION

Monthly Airline performance Load factors, enplanements, departures

Revenue guarantee indicators Ticket revenue, cost, drawdown

Quarterly Airline performance Load factors, enplanements, departures, revenue per avai lable

seat mile

Airfares Compare US DOT airline reported average airfares on a quarterly
basis, when available, to prior quarters

Published airfares will be monitored for the first three months of
service then quarterly thereafter via one of the Global Distribution/Computer Reservations Systems (GDS/CRS)

9 Months Program assessment Complete an overall assessment of the program to determine if
additional community marketing support is needed beyond one year

12 Months Passenger Demand Analysis Conduct a follow

- up true market estimate to determine retention at

OXR after the first 12 months of service.P AGE 21APPLICATIONUNDER THESMALLCOMMUNITYAIRSERVICEDEVELOPMENTPROGRAMCOUNTY OFVENTURA/OXNARDAIRPORT 

# A **PPENDIX** 

# A.

**C OMMUNITY**  

# S **UPPORT**

ppendix A includes letters of support for the OXR application to the US DOT to reinstate air

service at OXR . Support letters were submitted by participants in the public

- private

partnership and members of the Ventura County community. The letter s of support are

included on the following pages of this Appendix A

.



### Government

Congress of the US, Member of Congress

Lois Capps

Department of the Navy, Port Hueneme

Division

California Assembly District 12,

Assemblywoman Fiona Ma

County of Ventura Board of Supervisors,

Supervisor Kathy Long

County of Ventura Board of Supervisors,

Supervisor John Zaragoza

City of Oxnard, Community Development

Director Curtis P. Cannon

City of Ventura, Mayor Mike Tracy



### Public

- Private P artnership

County of Ventura Department of

Airports /OXR (see cover let ter) 

### Public

- Private Partnership (cont.)

Economic Development Corporation of

Oxnard

Oxnard Convention and Visitors Bureau

Oxnard Chamber of Commerce

KCLU Radio



### Businesses and Organizations

Budget Rent A Car

California Airports Council

Crowne Plaza Ventura Beach Hotel

Dollar Rent A Car

Embry Riddle Aeronautical University

Four Points by Sheraton

Gold Coast Broadcasting, LLC

Holiday Inn Express & Suites

San Francisco International Airport

Ventura County Lodging Association

Yellow Cab Company 

# A

## 501 Poli Street • P.O. Box 99 • Ventura, California 93002-0099 • 805.654.7800 • cityofventura.net 

## J u ne 4, 2012

Aloha Ley Associate Director, Small Community Program Office of Aviation Analysis 1200 New Jersey Avenue, SE W86-310 Washington, DC 20590

Dear Ms. Ley:

I am writing in support of the Ventura County/Oxnard Airport application for funding through the Small Community Air Service Development Program.

Until 2010, Oxnard Airport provided access to the National Transportation System for the residents of Ventura County. Since losing service in 2010, Oxnard Airport has been working with carriers to re-instate service at the airport, however in today’s economic climate, airlines are looking for financial support to help reduce the risk associated with starting new service. The funds requested will be used for airline incentives to attract new service at the Oxnard Airport and re-instate access to the National Transportation System by adding service to San Francisco International Airport.

I understand that over 1 million passengers a year are generated from the Oxnard Airport’s catchment area, and these passengers today are forced to drive to Burbank’s Bob Hope or Los Angeles International Airport to gain access to the National Transportation System. This drive adds significant costs for Ventura County travelers, as well as adding to congestion and pollution for Southern California.

Again, it is my hope that you will give the Oxnard Airport proposal full consideration and award the funds requested to help Oxnard re-establish access to the National Transportation System by attracting new service to the San Francisco bay area with Alaska Airlines.

Sincerely,

Mike Tracy
Mayornational sponsorship group

1 6 23 bridgegate street ▪ westlake village ▪ ca 91361

o: 805.230.2230 ▪ e: rpack@nationalsg.com ▪ c: 818.422.0152 

### June 11, 2012

Aloha Ley Associate Director, Small Community Program Office of Aviation Analysis 1200 New Jersey Avenue, SE W86-310 Washington, DC 20590

Docket #: DOT-OST 2012-069

Dear Ms. Ley;

This letter is sent to you to indicate my support of the application of Ventura County/Oxnard Airport or a grant in the 2012 Small Community Air Service Development Program. The grant requested is $500,000 with a local contribution and revenue guarantee program of $493,000 as an incentive for new air service at Oxnard Airport. Should Ventura County choose to advertise through NSG for the air service development, NSG will provide a percentage of in kind advertising to benefit the program.

The Oxnard Airport has had continuous passenger air service since 1946 and, unfortunately, United Express terminated its scheduled air service leaving Oxnard Airport with no air service. The loss of air service has a significant impact on our business. Our only option is to now drive to either Burbank Airport or Los Angeles International Airport. The drive on the freeways from Ventura County is long and very congested. It can easily take over two hours to get to either airport.

I understand that Ventura County Department of Airports management has had meetings with Alaska/Horizon Air about providing nonstop service to the San Francisco Bay area with flights continuing on to other destinations. We are in support of this type of air service and will be an important link to markets and connections to other areas. We believe that if Alaska/Horizon Air is successful at Oxnard Airport, they will add more flights to other markets or other airlines will come to our airport with nonstop service to other regional hub airports.

I strongly support the application of Ventura County/Oxnard Airport for a grant under this program and will support the new air service.

Sincerely yours,



# Rick Pack

Rick Pack

P r esident/CEO

KCLU Radio Sales and Marketing Representatives

### J une 6, 2012

Ms. Aloha Ley

Associate Director Small Community Program – Office of Aviation Analysis 1200 New Jersey Avenue, SE W86-310 Washington, DC 20590

Docket Number – DOT-OST-2012-0069

Dear Ms. Ley:

I am writing to you as the current President of the California Airports Council. The California Airports Council was formed in 2009 and is comprised of 30 publicly-owned, commercial airports in California.

The Council wishes to express its strong support for the Ventura County-Oxnard Airport application for a $500,000 grant under the Department of Transportation’s Small Community Air Service Development Grant Program. The requested grant funding is critical to promote air service from Oxnard to the Oakland/San José/San Francisco Bay Area.

Oxnard began providing commercial air service to the residents of Ventura County in 1946. However, since 2010, when Oxnard lost commercial air service, this region of 800,000 has had no convenient options for air service. Ventura County residents wishing to travel to the Bay Area – or to any other destination – must now drive between 47 and 63 miles (one-way) to get to the nearest commercial airports in Los Angeles, Burbank or Santa Barbara. In fact, 74 percent of all Ventura County residents needing commercial air drive the 63 miles to Los Angeles. In the past year, Ventura County had more than one million origin and destination passengers needing to drive to and/or from Los Angeles, Burbank or Santa Barbara for commercial air service. That represents a significant amount of inconvenience for a significant number of travelers.

Supporting commercial air service between Ventura County and the Bay Area will: 1) restore a degree of commercial air service convenience for Ventura County residents; 2) reduce traffic congestion and the negative impact on local air quality; 3) generate jobs and other related economic benefits for the community; and 4) strengthen California’s the air service system.

For all of the aforementioned reasons, we urge your thoughtful consideration and approval of Oxnard’s funding application.

William F. Sherry, A.A.E.

President

1 510 14 th 

### Street, Sacramento, CA 95814

T el. 916.553.4999 Fax 916.447.4947 www.calairportscouncil.org

# Ventura County Lodging Association

5235 Mission Oaks Boulevard, Suite 741

Camarillo, CA 93012
June 6, 2012

Ms. Aloha Ley Associate Director, Small Community Program Office of Aviation Analysis 1200 New Jersey Avenue, SE W86-310 Washington, DC 20590

RE: Commercial Air Service at Oxnard, California Airport

Dear Ms. Ley:

The Ventura County Lodging Association (VCLA) offers this letter in full support of th e Ventura County/Oxnard Airport application for funding through the Small Community Air Service Development Program.

By way of background, the VCLA consists of sixty hotels in Camarillo, Oxnard and Ventura. It was formed during 2011 to promote tourism in the area, particularly from businesses and from group visitors. The program is supported by a 1.5 percent additional room fee on local hotel rooms that generates an annual operating budget of $1 .2 million for advertising purposes. VCLA advertising is placed strategically throughout Southern and Central California to bring to the public’s attention the many attributes of visiting, recreating and doing business in Ventura County.

Until 2010, Oxnard Airport provided access to the National Transportation System for the residents of Ventura County. Since losing service in 2010, Oxnard Airport has been working with carriers to re-instate service at the airport, however in today’s economic climate airlines are looking for financial support to help reduce the risk associated with starting new service. The funds requested will be used for airline incentives to attract new service at the Oxnard Airport and re-instate access to the National Transportation System by adding service to San Francisco International Airport.

Interest has been expressed by our hotel operators and prospective visitors for the return of scheduled commercial air service to our area. The hospitality industry believes that air service would be well utilized by our customers. Such service would offer convenience to the customer base and thus serve to encourage conducting more business in Ventura County. The Oxnard-San Francisco route is of particular interest to this community.

Ventura County, with a population of nearly 840,000 is the eleventh largest county in California and the only one in the top tier without commercial air service.

## Ms. Aloha Ley

June 6, 2012 Page 2

As the economy slowly improves and the VCLA and other business interests attract more commercial, hospitality and casual tourism to this area, it is apparent that the sustained need for air service has arrived. The business and general communities are prepared to demonstrate both that need and support for its return.

It is our understanding that over 1 million passenger trips are generated annually from the Oxnard Airport’s catchment area. Currently these passengers are forced to drive to Burbank’s Bob Hope Airport or Los Angeles International Airport to gain access to the National Transportation System, trips that often average 90 minutes through the Los Angeles area traffic. The drive adds significant costs for Ventura County travelers, as well as adding to congestion and air pollution in Southern California.

Again, it is our hope that you will give the Oxnard Airport proposal full consideration and award the funds requested to help Oxnard re-establish access to the National Transportation System by attracting new service to the San Francisco bay area with

Alaska Airlines.

Sincerely,



# Gary Wartik

Gary Wartik

Administrator

C: Ventura County Department of Airports