### Order 2010

- 5

- 3 Served: May 3, 2010



## UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 3 rd 

### of May, 2010

Essential Air Service at

RAMPART

, ALASKA

Under 49 U.S.C. 41731 et s eq

. DOCKET OST

- 200 8

- 0 20 1

ORDER REQUESTING PROPOSALS Summary By this order, the Department is requesting proposals by June 3

, 2010

, from carriers interested in providing essential air service (EAS) at Rampart

, Alaska

, for a new two

- year period, begin ning October 1 , 2010

, with or without subsidy.

Background By Order 2008

- 9

- 20

, September 16 , 200 8 , the Department selected Warbelow’s Air Ventures,

Inc.

, to provide subsidized EAS to Rampart

, Alaska

, through September 30 , 2010

. Under that order, the Dep artment authorized subsidy for Warbelow’s consisting of tw o nonstop round trips per week year round to Fairbanks

, Alaska

. All of the service was to be with 9

- seat Piper Navajo aircraft for an annual subsidy of $86,701

.

Request for Proposals

As the end of the current rate term approach es , we are here by requesting proposals from carriers interested in providing service at Rampart

, with or without subsidy, for the two

- year period beginning October 1 , 2010 . Carriers should file their proposals by June 3

. S taff will

then docket 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 community and S tate and as k them to submit their final comments. We will give full consideration to all proposals filed in a timely manner. 1



### Interested carriers should prepare their proposals with every expectation that their initial proposals will also be their final and onl y proposals. We retain the discretion to negotiate proposals with carriers when we deem it desirable. We also retain the discretion to reject outright all unreasonable or unrealistic proposals and , if necessary, solicit a new round of proposals. However , we anticipate that negotiation or rejection will remain only occasional exceptions to the rule.

1 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

carr ier’s subsidy

- free service as proposed.

### - 2

-

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 pre cise 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 community and the Department. We do not anticipate any change in our selection criteria, or in the general provisions governing subsidy payments for essential air service. 2



### With specific respect to Rampart , we expect proposals consisting of tw o or three round trips a week with small aircraft. 3 

### We would not dismiss any proposal out of hand without first consulting with the community officials.

We encourage proposals that meet the community’s 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 the current service pattern if they envision other, potentially more attractive service possibilities

– different hubs, or seasonal service

– with subs idy requir e ments that remain competitive.

We encourage carriers to work with the communit y as they are preparing their proposals so that they can craft them to best meet the communit y ’ s needs. As always, we will fully

consider the community ’ s views befor e making a long

- term carrier

- selection decision.

Historical Traffic In order to assist carriers in making their traffic and revenue projections, we have

included historical traffic for the community in Appendix B

. For the most recent annual period, Ram part generated an average of 4.4 deplaned passenger equivalents per week. 4



### Other Carrier Requirements The Department is responsible for implementing various Federal statutes governing lobbying activities, drug

- free workplaces and nondiscrimination. 5

2 In selecting a carrier to provide subsidized essential air service in Alaska , 49 U.S.C. 41733(c) (1) directs

us to consider f ive factors. (1) service reliability; (2) contractual and marketing arrangements with a l arger carrier at the hub; (3) interline arrangements with a larger carrier at the hub; (4) community views ; and 

### Cons equently, all carriers receiving Federal subsidy to support essential air service must certify that they are in compliance with

(5) experience of the applicant in providing, in Alaska, scheduled air service or significant non

- scheduled

air service. In addition

, The Cons olidated 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 genera l provisions.

3 Order 2008

- 9

- 20 selected two nonstop round trips per week with a 9

- seat Piper Navajo based on community preference, but the carrier also proposed three nonstop round trips per week with Cessna 206 aircraft. The order explicitly allowed th e carrier to substitute Cessna 206 aircraft with 6 passenger seats assigned for payout purposes.

4 We have used deplanements, because deplanements at Rampart, as is typical of bush Alaska, exceed enplanements. Also, we have used passenger equivalents, whe re 200 pounds of mail or freight is one passenger equivalent, to reflect the importance of mail and freight in Alaska.

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

### - 3

-

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. All carriers that plan to submit proposals involving subsidy should submit the required certifications along with their propos als. Interested carriers requiring more detailed information regarding these requirements, as well as copies of the certifications, should contact the Office of Aviation Analysis at (202) 366

- 5903 . The Department is prohibited from paying subsidy to carr iers

that do not submit these documents.

Community Comments Civic officials and the State are welcome to submit comments on the proposals at any time. As noted earlier, we will provide a summary of the proposals to the civic parties

and ask them to submi t their final comments shortly after June 3 , the due date for carrier proposals.

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

- delegated to the

Directo r, Office of Aviation Analysis.

ACCORDINGLY,

1. The Department requests pro posals from carriers interested in providing essential air

service at Rampart

, Alaska

. Carriers should submit their proposals, with subsidy if necessary, by June 3

, 2010 . Proposals should include all the data required by section 204.4 of the Department’s Regulations (14 CFR 204.4). Proposals should be emailed to EAS@dot.gov, with the title “Proposal to Provide Essential Air Service at Rampart

, Alaska , Docket DOT

- OST

- 200 8

- 0 20 1

. ” Questions regarding filings may be directed to

Kevin Adams at 202

- 366

- 1047 o r Kevin.Adams@dot.gov ;

2

. Th is D ocket will remain open until further order of the Department; and

3 . We will serve this order on the s ervice l ist for th is Docket.

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. H OMAN

Director Office of Aviation Analysis

(SEAL)

An electronic version of this document is available on the World Wide Web at http://www.regulations.govAppendix A

Currently Subsidized Communities with Fair banks as the Hub

Carriers: 3Z, Tatonduk, Q5, 40

- Mile, 4W, Warbelow’s



### Nonstop, Great Circle Miles from Fairbanks ( FAI ) Central (CEM) 104 Circle (IRC) 131 Healy Lake (HKB) 110 Lake Minchumina (LMA) 148 Manley (MLY) 83 Minto (MNT) 50 Rampart (R MP 82

This map is provided by Sabre ® AirVision TM Profit Essentials and is being used with express permission of the copyright holder, Sabre Airline Solutions®.Appendix B T-100 Market, Passengers, Freight and Mail at Rampart, Alaska

Enplaned Deplaned Origin and Destination

Frt. Mail Total Frt. Mail Total Frt. Mail Total

Year Month Pax. PEQs PEQs PEQs Pax. PEQs PEQs PEQs Pax. PEQs PEQs PEQs

2007 4 12 0.4 0.5 12.8 12 6.5 5.3 23.7 24 6.8 5.8 36.6

2007 5 9 0.0 0.3 9.3 7 4.0 5.3 16.3 16 4.0 5.6 25.6

2007 6 12 0.8 0.5 13.3 10 5.9 4.1 20.0 22 6.7 4.6 33.3

2007 7 30 3.5 0.4 33.9 26 9.1 3.7 38.8 56 12.6 4.1 72.7

2007 8 12 0.5 2.4 14.9 12 4.7 3.1 19.9 24 5.2 5.5 34.7

2007 9 9 1.2 2.8 13.0 3 9.1 2.7 14.8 12 10.3 5.5 27.8

2007 10 11 0.1 1.2 12.2 8 6.1 3.5 17.6 19 6.2 4.6 29.8

2007 11 7 0.0 1.9 8.9 7 6.7 5.4 19.2 14 6.8 7.3 28.0

2007 12 10 0.4 1.3 11.7 16 6.0 5.2 27.2 26 6.4 6.5 38.9

2008 1 6 0.0 0.6 6.6 7 5.0 4.0 15.9 13 5.0 4.5 22.5

2008 2 6 0.0 0.9 6.9 7 2.2 2.6 11.8 13 2.2 3.5 18.7

2008 3 7 0.1 1.8 8.9 6 2.9 3.9 12.8 13 2.9 5.8 21.7

YE 3-31-08 131.0 7.0 14.3 152.4 121.0 68.2 48.8 238.0 252 75.2 63.1 390.3

2008 4 4 0.0 0.4 4.4 4 3.0 4.5 11.5 8 3.0 5.0 15.9

2008 5 4 0.0 1.1 5.1 11 6.0 4.8 21.8 15 6.1 5.9 27.0

2008 6 14 0.1 0.4 14.6 15 4.8 7.3 27.1 29 4.9 7.7 41.6

2008 7 17 3.1 1.2 21.3 16 7.1 3.8 26.9 33 10.1 5.0 48.1

2008 8 13 0.7 0.8 14.5 9 4.9 3.1 17.1 22 5.6 3.9 31.5

2008 9 17 1.4 1.4 19.8 10 4.0 1.2 15.2 27 5.4 2.6 35.0

2008 10 12 0.5 13.0 25.4 9 9.4 3.9 22.3 21 9.8 16.9 47.7

2008 11 8 0.2 10.9 19.1 4 2.6 2.0 8.6 12 2.8 12.9 27.7

2008 12 13 0.3 16.1 29.4 18 2.9 3.5 24.3 31 3.1 19.6 53.7

2009 1 16 0.0 0.5 16.5 15 3.9 3.5 22.4 31 3.9 4.0 38.9

2009 2 6 0.0 9.9 16.0 5 3.1 2.4 10.4 11 3.1 12.3 26.4

2009 3 10 0.0 20.7 30.7 14 3.5 2.6 20.1 24 3.5 23.4 50.8

YE 3-31-09 134.0 6.2 76.4 216.6 130.0 55.0 42.7 227.7 264 61.3 119.1 444.4

2009 4 7 0.1 17.8 24.9 7 3.1 3.4 13.5 14 3.2 21.2 38.4

2009 5 9 0.0 13.8 22.9 16 6.9 3.4 26.3 25 6.9 17.3 49.2

2009 6 7 0.0 9.7 16.8 13 6.8 6.2 26.0 20 6.8 15.9 42.7

2009 7 14 0.6 0.1 14.7 15 10.1 3.3 28.4 29 10.7 3.4 43.1

2009 8 9 0.6 0.5 10.1 11 3.9 3.3 18.2 20 4.5 3.8 28.3

2009 9 10 0.1 1.0 11.1 11 3.2 3.2 17.4 21 3.3 4.2 28.5

2009 10 16 0.8 15.5 32.3 6 2.6 2.7 11.3 22 3.5 18.2 43.7

2009 11 10 0.4 17.6 28.0 10 5.3 2.0 17.3 20 5.7 19.6 45.3

2009 12 9 0.0 1.1 10.1 12 9.2 2.7 23.9 21 9.2 3.8 34.0

2010 1 7 0.0 0.5 7.5 7 2.5 3.1 12.7 14 2.6 3.6 20.1

2010 2 4 0.0 0.5 4.5 6 0.4 2.2 8.7 10 0.4 2.7 13.2

2010 3 20 0.0 0.3 20.3 17 5.2 1.3 23.5 37 5.2 1.6 43.8

YE 3-31-10 122.0 2.6 78.5 203.1 131.0 59.3 36.9 227.2 253 61.9 115.5 430.4

Note: PEQs, 200 pounds of mail or freight is one passenger equivalent.

### Appendix C

Example of General Terms and Conditions fo r 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 fli ght 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 p eriod, 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 w riting 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 goa ls 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 requireme nts 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 lo cation 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 cessati on 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 con trovert the foregoing paragraph.

Funds are not currently available for performance under this solicitation beyond [DATE]. The Department’s obligation for performance under this solicitation beyond [DATE], is contingent upon the availability of appropriat ed 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 ar e 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 Page 1 of 2

Distribution List , Alaska Bush Carriers

40

- Mile Air, Leif Wilson

40

- Mile Air, Vanessa Thompson
Adams, Kevin, Work
Aero Twin, AACA, Tony Cestnik
Air Excursions, Mike Loverink
Alaska Air Carriers Association, Joy Journeay
Alaska Airlines, Joe Sprague
Alaska Airlines, Sandy Sini ck
Alaska Central Express, John Seamon
Alaska Central Express, Mike Bergt
Alaska Central Express, Steve Endlich
Alaska DOT, Rebecca Cronkhite

Alaska DOT

- Medicaid Passenger Fares
Alaska Seaplanes, Craig Loken
Alsek Air, Les and Debra Hartley

Arctic Circle, Donald Singsaas
Arctic Circle, Kelly Harris
Arctic Transportation Services (ATS), Wilfred Ryan
Arctic Transportation Services, (ATS), Jim Hjelm
Bering Air, Allen Haddadi

Bering Air, Jim Rowe
Bob Stanford (Islairbk@Alaska.com)
Congressional, Begich, David Ramseur
Congressional, Begich, Megan Foster
Congressional, Begich, Tiffany Zulkosky
Congressional, Murkowski, Arne Fuglvog
Congressional, Young, Jeremy Price
Consultant, Hank Myers
Consultant, Ken Acton
Consultant, Norm Israelson

D orato Jets
Dorato Jets, Mark McKenna
Ellis Air Taxi, Lynn Ellis
Era Aviation, Mike Lenorman
ERA, David M. Richards
Frontier Flying, Bob Hajducovich
Grant Aviation, Bruce McGlasson
Hageland, Mike Hageland
Hageland, Patrick Thurston
Hageland, Steve Wahrnke
Harris Air, Fly Hackett

Harris Air, Scott

Harris Air, Scott Harris
Homeland Security, David Bernier
Homeland Security, Ragan, William
Homer Air, Andy Smircich
Iliamna Air, Tim LaPorte
Inland Aviation, Stephen Hill
Island Air, Bob Stanf ord
Island Air, Jennifer Stanford

Katmai Air, Sonny Peterson
LAB Flying Service, Eric Bennett

### Appendix D Page 2 of 2

Larrys Flying, Jean Chenaille
Michael Duffy (Michael.Duffy@dhs.gov)
Myers, Larry (OST)
Northern Air cargo, Dave Squier
Northern Air Cargo, Keven Schlosst ein
OST, Dennis DeVany
OST, Renee Williams
Pacific Airways, Steve Montanus

PenAir Consultant, Patrick Rizzi
PenAir, Danny Seybert
PenAir, Kim Kawaguchi
PenAir, Orin Seybert
PenAir, Robert Cohn
PenAir, Scott Bloomquist
ProMech, Mark Sessoms

RITA , Benard Stankus
Salmon Air, Ron Salmon
SeaPort Airlines, Jim Day
SeaPort Airlines, Rob McKinney
SeaPort, Daniel Helland
Servant Air, Wes Osowski
Skagway, Ben Lingle
Smokey Bay Air, Claire McCann
Spernak Airways, Mike Spernak

Tanana Air Service, Brian Martin
Taquan Air Service, Brien Salazaar
Taquan, Beckie Allen
Tatonduk, Controller, Tina Paylor
Tatonduk, Marketing, Robert Ragar
Tatonduk, Owner, Robert Everts

USPS, Greg Garcia
USPS, Leonard Kilburn
USPS, Mary Tobias

USPS, Steve Deaton
USPS, Tina Campbell
USPS, William Jones
Warbelows Air Ventures, Art Warbelow
Ward Air, Ed Kiesel
Wings of Alaska, Mike Steadman
Wright Air Service, Bob Bursiel

Yute, Tim Vottis