Order 2011-4-15

Served: April 15, 2011

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

 Issued by the Department of Transportation

on the 15th day of April, 2011

ORDER REQUESTING PROPOSALS

Summary

By this order, the Department is requesting proposals from carriers interested in providing 

essential air service (EAS) at any or all of the communities listed above, with or without subsidy,

for the two-year period from November 1, 2011, through October 31, 2013. Proposals are due

May 25, 2011. (See Appendix A for a map.)

Background

Air Midwest ceased operations at the four Arkansas communities discussed here on June 30, 

2008. Great Lakes Aviation, Ltd. (Great Lakes) was selected to provide EAS at these 

communities by a series of orders.1 Great Lakes never inaugurated service and notified the 

Department it would not inaugurate the service it was selected to provide. In response, the 

Department solicited proposals to provide service. By Order 2009-6-25, June 26, 2009, the 

Department selected Alaska Juneau Aeronautics, Inc. d/b/a SeaPort Airlines (SeaPort) to serve 

all four communities for a two-year period, at a combined first-year subsidy rate of $6,046,789 

 

1 Order 2008-5-2, May 5, 2008, for Jonesboro, and Order 2008-7-8, July 3, 2008, for El Dorado/Camden, Harrison, 

and Hot Springs. 

Essential Air Service at

EL DORADO/CAMDEN, ARKANSAS

HARRISON, ARKANSAS

HOT SPRINGS, ARKANSAS

JONESBORO, ARKANSAS

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

 Docket DOT-OST-1997-2935

 Docket DOT-OST-1997-2935

 Docket DOT-OST-1997-2935

 Docket DOT-OST-1997-2935

 

 
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(El Dorado/Camden [El Dorado]: $2,095,517, Harrison: $1,695,929, Hot Springs: $1,419,102, 

Jonesboro: $836,241). The combined second-year subsidy rate is $5,740,363 (El Dorado: 

$2,060,725, Harrison: $1,591,119, Hot Springs: $1,288,527, Jonesboro: $799,992). Service was 

to consist of 18 weekly nonstop round trips between each community and Memphis, with 9-seat 

Pilatus PC-12 aircraft. The Order was tentative since the Department selected SeaPort at service 

and subsidy levels less than it had proposed. We gave SeaPort 10 days to object or to accept the 

terms and conditions. SeaPort did not object and we issued Order 2009-7-8, July 9, 2009, 

finalizing our selection of SeaPort at the above service and subsidy levels.

SeaPort inaugurated service at all four communities on October 26, 2009, thus making the 

expiration date of its contract October 30, 2011.

Since SeaPort inaugurated service, the Department has issued several Orders2allowing alternate 

service patterns at all four communities, all with the full support of the communities. SeaPort 

currently operates service from Harrison and Jonesboro to Memphis and Kansas City. SeaPort 

currently operates service from El Dorado and Hot Springs to Memphis. Service from El Dorado 

and Hot Springs to Dallas Love Field has not been inaugurated, although an alternate service 

pattern permitting it was issued. See footnote 2.

Special discussion concerning Hot Springs and Jonesboro

Based on the most recent 12-month period for which data are available (February 1, 2010,

through January 31, 2011), 1,602 passengers were enplaned and deplaned at Hot Springs, while 

952 passengers were enplaned and deplaned at Jonesboro. The current annual subsidy3amount 

for Hot Springs is $1,288,527 and Jonesboro’s is $799,992. Therefore, the subsidy per passenger 

at Hot Springs is $804 and $840 at Jonesboro. The Department is prohibited from subsidizing 

air service at a community where the subsidy per passenger exceeds $200, unless the community

is more than 210 highway miles from the nearest large or medium hub airport4. Hot Springs and 

Jonesboro well exceed the $200 per passenger cap and both are fewer than 210 miles from a 

large or medium hub. Hot Springs is 198 miles and Jonesboro is 82 miles, both from Memphis

International Airport (MEM), a medium hub airport.

Both communities experienced a hiatus in service between Air Midwest’s cessation of operations 

on June 30, 2008, and the inauguration of service from SeaPort on October 26, 2009. We note 

that these four communities suffered the longest service hiatus of all the communities affected by

four EAS carrier shut downs and, while we allow for traffic to rebuild after such a hiatus, 

enplanements at both communities remain quite low, averaging 2.6 enplanements per day at Hot 

Springs and 1.5 per day at Jonesboro.

5

 As noted above, the per-passenger subsidy exceeds the 

$200 cap by over four times, with both communities having a per passenger subsidy in excess of 

 

2 Order 2010-4-3, April 7, 2010, allowing service from Harrison to Kansas City, in addition to Memphis; Order 

2010-6-7, June 3, 2010, allowing service from El Dorado and Hot Springs to Dallas Love Field, in addition to 

Memphis; and Order 2011-1-5, January 7, 2011, allowing service from Jonesboro to Kansas City, in addition to 

Memphis.

3 Annual subsidy rates listed here are second-year rates, lower than first-year rates, as proposed by SeaPort.

4 Congress first established the $200 ceiling under P.L. 101-164 for fiscal year 1990, and reestablished it in fiscal 

years 1994-1999. The ceiling was made permanent by P.L. 106-69, the Department of Transportation and Related 

Agencies Appropriations Act of 2000.

5

See Appendix B for traffic history.
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$800. However, rather than terminate service eligibility at either community, at this stage, the 

Department will solicit proposals for EAS at both, but the Department will evaluate all proposals 

submitted before committing to a two-year contract or making a final determination on Hot 

Springs and Jonesboro’s continuing eligibility. During the window prior to the due date for 

proposals, we expect both communities to work aggressively with all potential applicants to 

mitigate some of the risks that the carriers may face in an attempt to lower their subsidy levels

and/or increase passenger traffic.

Request for Proposals

As the end of the current rate terms approach, we are here requesting proposals from carriers 

interested in providing service at El Dorado, Harrison, Hot Springs, and/or Jonesboro, with or 

without subsidy, for the two-year period from November 1, 2011, through October 31, 2013. 

Carriers should file their proposals no later than May 25, 2011. After that date, our staff will 

docket the proposals, thereby making them public, and direct each carrier to serve a copy of its 

proposal on the civic parties and other applicants. Shortly afterwards, we will provide a 

summary of the proposals to the communities and ask them to submit their final comments. We 

will give full consideration to all proposals that are timely filed.6

Interested carriers should prepare their proposals with every expectation that their initial 

proposals will represent their final and only proposals. However, we retain the discretion to 

negotiate proposals with carriers when we deem it desirable; in such cases, of course, we will 

give all applicants the same opportunity. We also retain the discretion to reject outright all 

unreasonable or unrealistic proposals and re-solicit a new round of proposals. However, 

negotiation or rejection are only occasional exceptions to the rule.

We are here providing interested carriers with some basic information to serve as guidance when 

they prepare their proposals, but we will not prescribe a precise format for their proposals. We 

expect proposals to adequately describe the service being proposed and the annual amount of 

subsidy being requested. The applicants can make their own judgments as to the level of detail 

they wish to present; however, they might want to include proposed schedules as well as 

supporting data for their subsidy requests, such as projected block hours, revenues and expenses. 

We strongly encourage clear, well-documented proposals that will facilitate their evaluation by

the affected communities and the Department.7

 

6 Carriers should not expect the Department to accept late filings. In cases where a carrier proposes to provide 

essential air service without subsidy and we determine that service can be reliably provided without such 

compensation, we do not proceed with the carrier-selection case. Instead, we simply rely on that carrier’s subsidyfree service as proposed.

7 In selecting a carrier to provide subsidized essential air service, 49 U.S.C. 41733(c) (1) directs us to consider four 

factors: (1) service reliability; (2) contractual and marketing arrangements with a larger carrier at the hub; (3) 

interline arrangements with a larger carrier at the hub; and (4) community views. In addition, the Consolidated 

Appropriations Act, 2008, Public Law 110-161, provides that when selecting a carrier to provide EAS, the 

Department may consider the relative subsidy requirements, thus codifying a factor that we have considered since 

the inception of the program. Interested carriers should also be aware that our general provisions governing 

essential air service will be included in the selection order as part of our authorization of subsidy for the selected

service. Appendix C of this order contains those general provisions. 
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With respect to each community, we expect proposals consisting of service with two-pilot, twinengine aircraft with at least 15 passenger seats, and offering two round trips each weekday and 

weekend (12 total round trips per week) to a suitable hub airport (e.g. Dallas/Fort Worth, 

Houston George Bush Intercontinental, Kansas City, Memphis, or St. Louis), that offers

numerous connecting opportunities to the national air transportation system. Two communities 

may be served on a linear basis, where traffic demand and aircraft size are appropriate (e.g. 

Harrison – Hot Springs – Dallas/Fort Worth). If aircraft with fewer than 15 passenger seats are 

contemplated, service patterns should consist of three nonstop round trips each weekday and 

weekend (18 total round trips per week). If such a proposal is submitted and the community

ultimately supports the service, in effect waiving their right to 15-seat or larger aircraft, we 

would consider the waiver to apply only to the two-year carrier-selection at hand, i.e. we would 

not assume that the community waives their rights for all time. Harrison and Hot Springs have 

requested that we solicit proposals that include at least one option to a specific hub, but service 

proposals to other hubs will also considered. The list below summarizes the hubs that those two 

communities have noted are of high interest to them.

 Harrison – Dallas/Fort Worth International, Kansas City, or Memphis

 Hot Springs – Dallas/Fort Worth International or Dallas Love Field

Regarding proposals for Hot Springs and Jonesboro, as stated above, we will evaluate all 

proposals submitted before committing to a two-year contract or making a final determination on 

those two communities’ continuing eligibility. Proposals including Hot Springs and/or 

Jonesboro should acknowledge the per passenger subsidy as stated above, and describe specific 

plans to address the issue, including, but not limited to, lower annual subsidy levels, marketing 

plans, such as advertising or fare promotions, enhanced access to connections to the national 

transportation system, codeshare agreements with major airlines, and/or wider access to 

distribution in reservation systems or consumer websites.

Communities and air carriers are encouraged to work together in advance of the due date for 

proposals to craft a service pattern that is desirable to the community and meets the operational 

needs of the airline interested in submitting a proposal. In addition, carriers should be very clear 

as to whether a specific community’s proposal is on a stand-alone basis, or whether it is part of a 

larger, inseparable package with other communities.

We encourage proposals that meet these requirements in an efficient manner. Carriers are also 

welcome to propose more than one service option, if they choose; they need not limit themselves 

to those requirements if they envision other, potentially more attractive service possibilities –

different hubs, for example – with subsidy requirements that remain competitive.

Service and Traffic History

For the 12-month period ended January 31, 2011, the most recent period for which traffic data are 

available, El Dorado averaged 4.0 enplanements per day, Harrison 5.7, Hot Springs, 2.6, and 

Jonesboro 1.5.

8

 In order to assist carriers in making their traffic and revenue forecasts, we have 

included historical traffic data in Appendix B.

 

8

See Appendix B for historical traffic data. Enplanements represent one-half of total origin-and-destination traffic, 

and average enplanements per day are based on 313 days per service year.
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Other Carrier Requirements

The Department is responsible for implementing various Federal statutes governing lobbying 

activities, drug-free workplaces, and nondiscrimination.9 Consequently, all carriers receiving 

Federal subsidy for essential air service must certify that they are in compliance with Department 

regulations regarding drug-free workplaces and nondiscrimination, and those carriers whose 

subsidies exceed $100,000 over the life of the rate term must also certify that they are in 

compliance with the regulations governing lobbying activities. Because the Department is 

prohibited from paying subsidy to carriers that do not submit these documents, all carriers that 

plan to submit proposals involving subsidy should be aware that the selected carrier will be 

required to complete the required certifications. Interested carriers requiring more detailed 

information regarding these requirements should contact the Office of Aviation Analysis at 

(202) 366-5903.10

Community and State Comments

The communities and states are welcome to submit comments on the proposals at any time. As 

noted earlier, however, we will provide a summary of the proposals to the civic parties and ask 

them to submit their final comments shortly after May 25, the due date for proposals.

This order is issued under authority delegated in 49 CFR 1.56a(f) and re-delegated to the 

Director, Office of Aviation Analysis. 

ACCORDINGLY,

1. We request that carriers interested in providing essential air service at El Dorado/Camden, 

Harrison, Hot Springs, and/or Jonesboro, Arkansas, submit their proposals, with or without 

subsidy requests, no later than May 25, 2011. The proposals should be e-mailed to 

EAS@dot.gov, with the title “Proposal to Provide Essential Air Service at (community or 

communities of interest), DOT-OST-1997-2935”;

11

2. This docket will remain open until further order of the Department; and 

3. We will serve copies of this order on the mayors of El Dorado, Camden, Harrison, Hot 

Springs, and Jonesboro, and the airport managers of South Arkansas Regional Airport/Goodwin 

Field (El Dorado/Camden), Boone County Regional Airport (Harrison), Hot Springs Memorial 

Field Airport, and Jonesboro Municipal Airport, and the parties listed in Appendix D.

 

9 The regulations applicable to these areas are: (1) 49 CFR Part 20 -- New restrictions on lobbying; 

(2) 49 CFR Part 21 -- Nondiscrimination in federally-assisted programs of the Department of Transportation --

Effectuation of title VI of the Civil Rights Act of 1964; 49 CFR Part 27 --Nondiscrimination on the basis of 

disability in programs and activities receiving or benefiting from Federal financial assistance; and 14 CFR Part 382 -

- Nondiscrimination on the basis of disability in air travel; and (3) 49 CFR Part 29 -- Government-wide debarment 

and suspension (non-procurement) and government-wide requirements for drug-free workplace (grants).

10 The certifications are also available on the web at http://ostpxweb.dot.gov/aviation/index.html.

11 Questions regarding filings in response to this order may be directed via e-mail to Kevin Schlemmer at 

kevin.schlemmer@dot.gov or via phone at (202) 366-3176.
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Persons entitled to petition the Department for review of this order under the Department’s 

Regulations, 14 CFR 385.50, must file such petitions within ten (10) days after the date of 

service of this order.

This order will be effective immediately, and the filing of a petition for review shall not preclude 

its effectiveness.

By:

TODD M. HOMAN

Director

Office of Aviation Analysis

(SEAL)

An electronic version of this document at http://www.regulations.gov
Appendix A

AREA MAP

This map is provided by Sabre® AirVisionTM Profit Essentials and is being used with express permission of the 

copyright holder, Sabre Airline Solutions®.
Appendix B

Page 1 of 2

Traffic History*

Stn Year Month Inbound traffic Outbound traffic Totals

ELD 2009 10 23 2 25

ELD 2009 11 70 59 129

ELD 2009 12 77 66 143

ELD 2010 1 77 72 149

ELD 2010 2 44 76 120

ELD 2010 3 88 82 170

ELD 2010 4 96 94 190

ELD 2010 5 99 102 201

ELD 2010 6 101 119 220

ELD 2010 7 116 127 243

ELD 2010 8 126 115 241

ELD 2010 9 200 120 320

ELD 2010 10 136 144 280

ELD 2010 11 89 69 158

ELD 2010 12 102 100 202

ELD 2011 1 92 83 175

2,520 (12-months traffic ending 1/31/11)

Stn Year Month Inbound traffic Outbound traffic Totals

HOT 2009 10 27 19 46

HOT 2009 11 34 38 72

HOT 2009 12 30 32 62

HOT 2010 1 34 41 75

HOT 2010 2 50 53 103

HOT 2010 3 51 54 105

HOT 2010 4 79 68 147

HOT 2010 5 56 56 112

HOT 2010 6 58 72 130

HOT 2010 7 62 71 133

HOT 2010 8 54 59 113

HOT 2010 9 115 105 220

HOT 2010 10 78 75 153

HOT 2010 11 52 47 99

HOT 2010 12 86 79 165

HOT 2011 1 60 62 122

1,602 (12-months traffic ending 1/31/11)
Appendix B

Page 2 of 2

Traffic History (continued)

Stn Year Month Inbound traffic Outbound traffic Totals

HRO 2009 10 19 22 41

HRO 2009 11 128 111 239

HRO 2009 12 103 112 215

HRO 2010 1 94 113 207

HRO 2010 2 107 104 211

HRO 2010 3 113 116 229

HRO 2010 4 157 153 310

HRO 2010 5 112 103 215

HRO 2010 6 125 132 257

HRO 2010 7 121 110 231

HRO 2010 8 153 163 316

HRO 2010 9 253 242 495

HRO 2010 10 170 197 367

HRO 2010 11 130 144 274

HRO 2010 12 193 198 391

HRO 2011 1 158 143 301

3,597 (12-months traffic ending 1/31/11)

Stn Year Month Inbound traffic Outbound traffic Totals

JBR 2009 10 9 9 18

JBR 2009 11 21 28 49

JBR 2009 12 24 29 53

JBR 2010 1 24 37 61

JBR 2010 2 19 38 57

JBR 2010 3 28 45 73

JBR 2010 4 28 36 64

JBR 2010 5 36 37 73

JBR 2010 6 36 38 74

JBR 2010 7 29 43 72

JBR 2010 8 34 33 67

JBR 2010 9 65 58 123

JBR 2010 10 39 40 79

JBR 2010 11 36 61 97

JBR 2010 12 51 49 100

JBR 2011 1 43 30 73

952 (12-months traffic ending 1/31/11)

ELD=El Dorado/Camden; HOT=Hot Springs; HRO=Harrison; JBR=Jonesboro

*Source – T-100 Market Report, Passengers in Scheduled Passenger Service; Traffic 

figures reflect SeaPort Airlines only.
Appendix C

Example of General Terms and Conditions for Essential Air Service

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 scheduled 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 the order 

during the applicable period of these rates, 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 locate 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. In 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 unilaterally, 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 stipulated amounts or at the stipulated service levels, the carrier may

cease to provide service to that specific location without regard 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 contracts 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 are not currently available for performance under this solicitation beyond [DATE]. 

The Government’s obligation for performance under this solicitation beyond [DATE], is 

contingent upon the availability of appropriated 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 under this order beyond [DATE], until funds are made available to the 

Department for performance. If funds are not made available for performance beyond 

[DATE], the carrier will receive notice in writing by the Department.

All claims for payment must be submitted within 60 days of the last day of service 

provided under this order.
Appendix D

Scheduled Air Carriers, Contiguous US and Puerto Rico

Air Greco/Wings Air Kenmore Air, Tim Brooks

Air Sunshine, Inc. McCall Aviation, Dan Scott

Air Sunshine, Mirmohammad Adili McCall Aviation, Michelle

Air West, Inc., John Raatz Mesaba, John Spanjers 

Air Wisconsin, Annette Daly Mesaba, Max Shemesh

Air Wisconsin, Jim Rankin MidStar Airlines, Jeffrey Fonner

Airline Associates, Bill Mishk Midwest Airlines, Greg Aretakis

Alaska Airlines, Jeff Cole MN Aviation, Jose Maldonado 

Alaska Airlines, Sandy Sinick Multi Aero, Darnea

Allegiant Air, Brian Davis Multi Aero, Shane Storz

American Airlines, Carl Nelson Northern Air Cargo, David Karp

American Eagle, Jeffrey Hartz Northern Air Cargo, Eric Van Andel

Atlantic Southeast, Jon Lindlief Northwest, Tim McDonald 

Atlantis Southeast, Roger Weston Northwest, Aaron Murray

Aviation Technologies/Charter Air Transport NYDC, Henok Araya

Bemidji Aviation, Cori Rude OST, Brian Swanson

Bemidji Aviation, Arlen Rinkenberger OST, Dennis DeVany

Cape Air, Andrew Bonney OST, Kevin Adams

Cape Air, Dan Wolf OST, Kevin Schlemmer

Cape Air, J. Flaherty OST, Michael Martin 

Classic Aviation, Tony Henderson Pacific Aviation Group, Craig Garrick

Colgan Air, Mike Colgan Pacific Aviation Group, Ron Pye

Colgan Air, Kevin Scott Pacific Wings, Frank Ford

CommutAir, Andy Price Pacific Wings, Greg Kahlstorf

CommutAir, Joel Raymond PenAir, Danny Seybert

Consultant, Robert Silverberg PenAir, Scott Bloomquist

Continental, Bruce Keiner Pinnacle Airlines, Jennifer Gammill

Continental, Dan Weiss Pinnacle Airlines, Megan Rosia

Continental, Lorry Halloway Pinnacle Airlines, Phil Reed

Delta, Anthony Canitano Planemasters, Inc. John Kessler

Delta, Dan Shuman Planemasters, Inc. Paul Berliner

Delta, Jeff Morgan Planemasters, Inc. Todd DeSimone

Delta, Joe Esposito Raytheon, Mike Scheidt

Delta, Karen Zachary Saab Group, Polly Prelinger

Delta, Kristal Murphy Scenic, Mary Schneider

Delta, Sascha Vanderbellen Scenic, Mitzi Daines

DHS, Bill Ragan Seaborne Airlines, Shawn Lewis

DHS, David Bernier SeaPort Airlines, Daniel Helland

Dorado Jets SeaPort/Wings of Alaska, Jim Day

Dorado Jets, Mark McKenna SeaPort/Wings of Alaska, Nate Vallier

Era Aviation, Lori Goodman SeaPort/Wings of Alaska, Rob McKinney

Executive Airlines, Kate Soled Shuttle America, Jerry Balsano 

Frontier Flying, Bob Hajducovich SkyWest, Brad Rawson

Frontier, Daniel Shurz SkyWest, Eric Christensen

Frontline Aviation SkyWest, Michael Thompson

Gem Air, Dan Schroeder Sovereign Air, Bob Karns

Gem Air, JoAnn Wolters Sovereign Air, Lois R. Barton

Great Lakes, Chuck Howell Tatonduk, Robert Everts

Great Lakes, Doug Voss Tatonduk, Robert Ragar

Gulfstream, Dave Hackett Tradewind, Eric Zipkin 

Gulfstream, Mickey Bowman TransStates, Fred Oxley 

Gulfstream, T. Cooper TransStates, Gerry Wigmore

Horizon Air, Dan Russo Transport Azumah, Joel Anabilah-Azumah

Horizon Air, Jennifer Thompson United, Alicia Gabriel

Horizon Air, Mike McQueen United, James Starnes

Horizon Air, Jeff Cole US Airways, Benjamin Slocum

ICEPR, Luis Irizarry US Airways, Howard Kass

Intrepid Internatl Air, Rick Eyk US Airways, Jason Reisinger 

Island Air Charters, Linda House Warbelows Air Ventures, Art Warbelow

Jet Air, Daniel Wolford