Order: 2014

- 7

- 8

Served: July 10, 2014



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 10 th day of July , 20 1 4

Essential Air Service at

ALPENA, MICHIGAN DOCKET DOT

- OST

- 2009

- 0300

under 49 U.S.C. 41731 et seq.



### ORDER RE

- SELECTING AIR CARRIER

Summary By th is O rder, the Department is re

- selecting SkyWest Airlines ( SkyWest )

, to provide

Essential Ai r Service (EAS) at Alpena, Michigan

, using 5 0

- passenger Canadair Regional Jet (CRJ200 ) aircraft to Detroit Metropolitan Wayne County Airport (Detroit) f or the two

year period from October 1, 2014, through September 30, 2016

, for an annual subsidy of $2,168,995

. 1

Background By Order 2012

- 6

- 20 ( June 22, 2012 ), the Department selected SkyWest to provide

12 nonstop round trips per week from Alpena to either Minneapolis

- St. Paul International Airport (Minneapolis) or Detroit using CRJ200 aircraft at an annual subsidy of $ 3,098,472

, for a two

- year contract whi c h is sch eduled to expire on September 30

, 2014.

As the end of the contract was approaching, we issued Order 2014

- 4

- 4 (April 3

, 2014 ) requesting proposals from air carriers interested in providing EAS at the community for a new term. In respo nse to that Order, SkyWest, the airline currently providing the service, was the only airline to submit a pr oposal.

1 Such subsidy is calculated and distributed on a fiscal year basis, subject to the availability of funds.- 2

-

SkyWest’s complete proposal and the community’s comments may be accessed online at www.regulations.gov by entering DOT

- OST

- 2009

- 0300 in the search block.

Proposal of SkyWest Airlines SkyWest submitted a proposal to provide Alpena 12 weekly n onstop round trip s to Detroit

usi ng CRJ200 aircraft for an annual subsidy of $2,168,995, for a two

- year term

. It plans to operate the service as Delta Connection and consolidate its Alpena service to Detroit, rather

than the current schedule which serves hubs at Detroit and Minneapolis

. SkyWest notes,

“ This change from the current schedule continues to provide passengers with access to nearly 500 Delta or Delta Connection departures per day through [ Detroit] , ensuring

p assengers are able to get to destinations around the world. In addition to being a major hub, we have found that Detroit is also the top destination for the community. ”

Community Comments On May 15

, 2014 , the Department solicited comm ents from the community regarding this

air carrier selection case. The Honorable Matthew J. Waligora, Mayor of Alpena

, submitted a letter on behalf of the community supporting SkyWest’ s proposal noting , “We appreciate [SkyWest’s] ongoing efforts to further improve the flight schedule to best suit our business and recreational travelers.” In addition, we received a letter from Ms. Billi McRoberts, Airport Manager at Alpena County Regional Airport

, stron gly supporting SkyWest’s proposal to Detroit. Ms. Roberts noted that “SkyWest has been an excellent air service provider for our community and I look forward to a continued working relationship and to the new flight pattern. ”

Decision Since SkyWes t was t he only air carrier to submit a proposal for Alpena ’s EAS case
, and

w e find the service and subsidy levels to be reasonable (in fact, SkyWest ’s pr oposed annual subsidy is $929,47 7 less than the previous contract)

, we shall make this re

- selection of SkyWest at Alpena . This decision is contingent upon the Department’s receiving properly executed certifications from the air carrier that they are in compliance with the Department’s regu lations regarding drug

- free workp laces and nondiscrimination, as well as the regulations concerning lobbying activities. 2

Carrier Fitness

49 U.S.C. §§ 41737(b) and 41738 require that we find an air carrier fit, willing, and able to provide reliable service before we may subsidize it to provide EAS

. SkyWest is subject to the Department’s continuing fitness requirements, and no information has come to our

attention that would caus e us to question the air carrier’s fitness at this time. We have contacted the Federal Aviation Administration, and it has raised no concerns that would negatively affect our fitness findin gs. We therefore conclude that SkyWest is reliable and

fit to con duct the operations proposed here.

2 The certifications are available online under “Reports and Publications” at http://www.dot.gov/policy/aviation

- policy/small

- community

- rural

- air

- service/essential

- air

- service- 3

-

This Order is issued under authority delegated in 49 CFR Part 1

. 25a(b)

.

ACCORDINGLY,

1

. We select SkyWest Airlines to provide Essential Air S ervice at Alpena

, Michigan and

establish the annual subsidy rate as described in Appendix C;

2

. We direct SkyWest Airlines to retain all books, records, and other source and summary documentation to support claims for payment, and to preserve and maintain such documentation in a manner that readily permits its audit and examination by representatives of the Department. Such d ocumentation shall be retained for seven years

from the service date of this Order or until the Department indicates that the records may be destroyed, whichever comes first. Copies of flight logs for aircraft sold or disposed of

must be retained. The ca rrier may forfeit its compensation for any claim that is not supported under the terms of this Order ;

3 . We f i nd that SkyWest Airlines is fit, willing and able to operate as a c ertificated air

carrie r
, and capable of providing reliable Essential Air S erv ice at Alpena , Michigan ;

4

. This docket will remain open pending further Department action ; and

5

. The Department will serve a copy of this O rder on the Mayor of Alpena, Michigan , the Airport Director at Alpena County Regional Airport

, and SkyWest A irlines.

B y:

SUSAN L. KURLAND Assistant Secretary for

Aviation and International Affairs

(SEAL)

An electronic version of this document is ava ilable at www.regulations.govAppendix A



## AREA MAP

Maps generated by the Great Circle Mapper

- copyright © Karl L. Swartz

.Appendix B



### SkyWes t Proposal for EAS at AlpenaAppendix C

SkyWest Airlines

Essential Air Service to be Provided at Alpena, Michigan

DOT

- OST

- 2009

- 0300

Effective Period : October 1, 2014

, through September 30, 2016

Scheduled Service : 12 weekly nonst op round trips to Detroit

Aircraft : 50

- passenger CRJ200 Rate per Eligible Flight: $ 1,7 74 1
Weekly Ceiling : $ 4 2,576 2

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance

with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significant elements of the required service, without prior approval. The carrier understands that an aircraft take

- off and landing at its

sched uled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight that has not been completed, such as certain weather cancellations, only completed flights are considered eligible for subsidy. In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant period, it may jeopardize its entire subsidy claim for the period in question. If the carrier contemplates any such changes beyond the scope of t he Order during the applicable period of this rate, it must first notify the Office of Aviation Analysis in writing and receive written approval from the Department to be ensured of full compensation. Should circumstances warrant, the Department may locat e and select a replacement carrier to provide service on these routes. The carrier must complete all flights that can be safely operated; flights that overfly points for lack of traffic will not be compensated. I n determining whether subsidy payment for a deviating flight should be adjusted or disallowed, the Department will consider the extent to which the goals of the program are met and the extent of access to the national air transportation system provided to the community.

If the Department unilater ally, either partially or completely, terminates or reduces payments for service or changes service requirements at a specific location provided for under this Order, then, at the end of the period for which the department does make payments in the stipula ted service levels, the carrier may cease to provide service to that specific location without regards to any requirement for notice of such cessation. Those adjustments in the levels of subsidy and/or service that are mutually agreed to in writing by the Department and carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract are subject to, and incorporate by reference, relevant statutes and Department regulations, as they may be

amended from time to time. However , any such statutes, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds may not be available for pe rformance under this O rder beyond September 30, 2014

. The Government’s obligat ion for performance under this O rder beyond September 30, 2014

, is subject to the availability of funds from which payment for

services can be made. No legal liability on the part of the Government for any payment may arise for performance u nder this order beyond September 30, 2014 , u ntil funds are made available to the Department for performance. If sufficient funds are

not made available for performance beyond September 30, 2014 , the Department will provide notice in writing to the carrier.

All claims for payment, including any ame nded claims, must be submitted within 90 days of the last day of the month for which compensation is being claimed. For example, claims for service provided in July must be filed by

October 31; August claims must be submitted by November 30, and so on.

1 A nnual compensation of $2,168,995 divide d by the 1,223 annual departures (24 weekly departures x 52 weeks x 98 percent completion)

. 2 24 arrivals and departures per week multiplied by $1,774 per flight

.