### BEFORE THE DEAPRTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C.

______________________________ ) Essential Air Service at ) ) EXCURSION INLET ) DOCKET OST-2002-12014 ) AND ) AND ) KAKE, ALASKA ) DOCKET OST-2008-0217 ) Under 49 U.S.C. 41731 et seq. ) ______________________________)

MOTION TO REOPEN

SELECTION OF CARRIERS

Answers to motions may be filed by any part y to the proceeding in support of or in

opposition to the motion within seven (7 ) business days after a motion is served.

Communications with respect to this document should be addressed to: Mike Loverink Hank Myers Owner Principal Consultant Air Excursions, LLC M.T.C. 1873 Shell Simmons Drive P.O. Box 7341 Juneau, AK 99801 Bellevue, WA 98008-1341 (907) 789-5591 425-641-8243 airex@ptialaska.net hank@mtcworld.com February 2, 2010

### 1 BEFORE THE DEAPRTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C.

______________________________ ) Essential Air Service at ) ) EXCURSION INLET ) DOCKET OST-2002-12014 AND ) AND KAKE, ALASKA ) DOCKET OST-2008-0217 ) Under 49 U.S.C. 41731 et seq. ) ______________________________)

MOTION TO REOPEN SELECTION OF CARRIERS

Air Excursions, LLC (Air Ex) hereby moves to reopen the selection of carriers to provide

Essential Air Service to Excursion Inlet and Kake, Alaska. In Order 2009-8-16, the Department selected Alaska J uneau Aeronautics, d/b/a Wings of Alaska (AJA) to provide

Essential Air Service to Excursion Inlet a nd Kake. At Kake, AJA proposed to provide fourteen round trips per week between J uneau and Kake with nine-passenger, 3,000 pound payload Cessna Caravan turboprop aircraft.

Air Ex moves to reopen the selection of ca rriers because AJA has failed to provide the service proposed in its bid, it ha s collected federal subsidy for services it did not provide,

it does not have sufficient Caravan aircraft to provide the serv ice proposed, and its degradation of service has failed to meet th e needs of the market as evidenced by the significant decrease in the numbe r of passengers (but not freight or mail) in the market. Air Ex requests that the Department solic it new Essential Air Se rvice proposals in the

### 2 markets which accurately reflect the level of service each carrier will provide, and the associated level of subsidy required. As s hown below, Air Ex is fully ready, willing and able to provide the required Essential Service in the markets using its own aircraft or in conjunction with other ce rtificated carriers.

AJA HAS FAILED TO DELIVER ON ITS SERVICE PROPOSAL

When it proposed its service, AJA said it mi ght use the smaller Cessna 207 as available, but based its revenue and expense projecti ons entirely on the Cessna Caravan. T-100 reports for the twelve months ended N ovember 30, 2009 (Appendix A), AJA used the Caravan it proposed and based its subsidy on for less than 45% of the f lights in the market. During the summer peak-traffic season, when the vast majority of schedules are operated, AJA used the Caravan only 35% of the time. During the same months it operated roughly a third of its subsidized flights in th e proposed Caravan, it operated

55% of its unsubsidized service to Hain es with Caravans, and over 70% of its unsubsidized service to Skagway with Carava ns. In short, AJA used the Caravans proposed for Kake service to provide capacity in larger monopoly markets.

AJA BASED ITS EAS BILLINGS ON SERVICE IT HAS NOT PROVIDED

AJA clearly had the ability and the aircraft to provide service consistent with its EAS proposal, but did not. Rather than deliver ing on its proposal, its operated the three

Caravan’s then in its fleet wherever it was mo st profitable to do so. AJA’s weight load

### 3 factors were higher for the Caravan than for the 207. While the Caravan load factor at Kake was only slightly higher than for the 207, it must be remember ed that the Caravan was only used on the 45% of th e flights with the highest de mand. In the larger JuneauSkagway market, the average summertime load factor in the Caravan was 47.7% compared to only 37.9% with the 207.

The use of the C-207 on the majority of the fli ghts resulted in a signi ficant overstatement of expected expenses. F-2 reports and the results of the Intra-Alaska Bush Mail Rate Investigation shows that the C-207 costs 40% or more less than the Caravan for direct operating expenses. Because AJA’s indirect expenses are based on its direct expenses plus a consistent markup, it saves 40% or mo re for every hour it uses its C-207’s in place of the Caravan. Reducing 55% of AJA’s actual operations by 40% ($1,014,449.78*.55*.40) shows that Wings has collected $223,179 more than it should have for expenses by substituting aircraft.

AJA additionally padded its projected expenses by greatly overestimating the amount of time required to fly the Juneau-Kake rout e. On Appendix B of its proposal, AJA estimates 919.8 block hours would be require d to operate the 505 round trips proposed. This yields an expected average block tim e of 109.28 minutes per round trip. According to the T-100 reports of AJA, the actual aver age round trip block time for its Juneau-Kake

service was 93.54 minutes. This is about 16 minutes less than charged, or 17% greater

expense.

### 4 Finally, AJA’s current fare in the market is about $5.00 more before taxes than it proposed in its revenue forecast.

AJA LACKS THE CARAVAN’S NECESS ARY TO OPERATE THE SERVICE

As noted, in the 12 months ended November , 2009, AJA operated only 45% of its Kake service with Cessna Caravans. This represen ted 12.7% of the scheduled use of the three Caravans. Since then, AJA has lost the use of two of the three Caravans. One leased aircraft, N331AK, was removed from servic e when it was found to have been operated under a maintenance program not approved for AJA. That aircraft is currently listed for sale. (See http://www.controller.com/listingsde tail/aircraft-for-sale/CESSNACARAVAN-208B-GRAND/1999-CESSNA- CARAVAN-208B-GRAND/1160273.htm )

1999 CESSNA CARAVAN 208B GRAND 208B0739 US $950,000 AK, US For Sale - $950,000 , N331AK; 8700 TT; IFR; CAPSTONE AVIONICS by CHELTON, WITH ADS-B. Aero Twin, Inc. Phone: (727)709-1159 Fax: (210)688-0210

Updated: 1/26/2010 6:53:00 AM Photo(s) Send A Message

Add To Aircraft Of Interest

### 5 The second aircraft, N72KA, was returned to the owner (Kenmore Aviation) in

December at the end of its lease.

In the 12 months ended November, 2009, AJA used the Caravan to operate 3,042

scheduled hours of service with three aircraft. 2,655 of thes e hours were in markets other than Kake. Clearly AJA is unable to meet its EAS obligations at Kake with only one

Caravan.

### 6 AJA HAS DEGRADED SERVICE AT KAKE

In the 12 months ended November, 2007 L.A.B. Flying Service transported 4,071 passengers between Juneau and Kake, as well as 194,053 pounds of freight and mail. Mail and freight, indicators of economic ac tivity, dropped to a total of 186,242 in the 12 months ended November, 2009, or 4%. In th e same span, passenger traffic dropped to 2,376 or 42% . Whether it is because of fewer seat s being offered, substitution with less desirable aircraft or higher passenger fares, as a result of AJA’s service passenger traffic dropped ten times as much as freight and mail in comparison to L.A.B..

SUMMARY

AJA, because it was the sole applicant, has enjoyed a very profitable and convenient run as an Essential Air Service provider. Even be fore it was selected it had overestimated the time necessary to provide the service by 17% , thereby overestimating its recompensed expense by that amount. Once it gained the cont ract, it raised fares and used the Caravan only 45% of the time. While AJA has gaine d, the Kake market has suffered. Some loss of traffic is reasonable given the economic ha rdships (mail and freight dropped 4%), but a 42% loss of traffic (nearly half) cannot be explained by external conditions. AJA has taken advantage of the government and the EAS markets. Now that it has lost two-thirds of its Caravan fleet, it can hardly be expected to improve its performance.

### 7 CERTIFICATION The contents of this application and the attach ed exhibits are true a nd correct to the best of my knowledge and belief. Pursuant to title 18, United States Code section 1001, I, in my individual capacity and as the authorized representative of the applicant, have not in any manner knowingly and willfully falsified, concealed or failed to disclose any material fact or made any false, fictitious, or fraudulent statement or knowingly used any documents which contain such statements in connection with the preparation, filing or prosecution of the application. I understand that an indi vidual who is found to have violated the provisions of 18 U.S.C. section 1001 shall be fined not more than $10,000 or imprisoned not more than five years, or both.

WHEREFORE , Air Excursions, LLC respectfully moves to reopen the selection of carriers to provide Essential Air Service to Excursion Inlet and Kake, Alaska. Air X actually has more aircraft in its Juneau fleet than AJA does, including a multi-engine Piper Navajo which is instrument approved, and, unlike the Caravan, can be operated in known icing conditions. Air X holds a certific ate of public convenience and necessity from the D.O.T., and is fit, willing and able to provide the Essent ial Service in question.

Respectfully submitted, AIR EXCURSIONS, LLC

_________________________ By Hank Myers February 2, 2010

### 8 CERTIFICATE OF SERVICE

I hereby certify that I have this day served a copy of the foregoing Motion to Reopen upon the following person by Priority Mail.

_________________________ Hank Myers February 2, 2010

Rob McKinney Chief Operating Officer Alaska Juneau Aeronautics, Inc. d/b/a Wings of Alaska d/b/a SeaPort Airlines 7505 NE Airport Way Portland, OR 97218

### 1 Appendix A Page 1 of 2

ALASKA JUNEAU AERONAUTICS T-100 SEGMENT REPORTS 12 MONTHS ENDED NOVEMBER, 2009

YR MO ORI DEST CARR A/C # DEP PAX FRT MAIL BLOCK FLT 2008 12 JUNEAU KAKE AJA 0 35 20 19 1878 3597 965 917 2008 12 JUNEAU KAKE AJA 4 16 13 31 2484 5810 580 537 2009 1 JUNEAU KAKE AJA 0 35 9 18 985 1196 472 440 2009 1 JUNEAU KAKE AJA 0 35 1 0 81 272 52 49 2009 1 JUNEAU KAKE AJA 4 16 7 19 1649 3614 339 313 2009 2 JUNEAU KAKE AJA 0 35 11 13 690 1795 567 527 2009 2 JUNEAU KAKE AJA 4 16 13 56 3409 5702 595 548 2009 3 JUNEAU KAKE AJA 0 35 30 43 2316 5202 1613 1525 2009 3 JUNEAU KAKE AJA 4 16 5 10 853 1829 227 210 2009 4 JUNEAU KAKE AJA 0 35 35 61 3380 3500 1826 1723 2009 4 JUNEAU KAKE AJA 4 16 14 50 1178 3007 641 597 2009 5 JUNEAU KAKE AJA 0 35 63 83 3512 5583 3414 3129 2009 5 JUNEAU KAKE AJA 4 16 10 33 572 2072 460 414 2009 6 JUNEAU KAKE AJA 0 35 41 59 2713 4163 2223 2077 2009 6 JUNEAU KAKE AJA 4 16 31 110 2439 2109 1536 1409 2009 7 JUNEAU KAKE AJA 0 35 47 70 2565 5180 2599 2406 2009 7 JUNEAU KAKE AJA 4 16 24 72 2069 2836 1067 973 2009 8 JUNEAU KAKE AJA 0 35 25 23 1886 2016 1384 1301 2009 8 JUNEAU KAKE AJA 4 16 36 106 2213 5517 1782 1639 2009 9 JUNEAU KAKE AJA 0 35 8 21 731 734 479 439 2009 9 JUNEAU KAKE AJA 4 16 48 86 3727 6369 2575 2295 2009 10 JUNEAU KAKE AJA 0 35 2 4 87 266 120 108 2009 10 JUNEAU KAKE AJA 4 16 30 113 5017 8429 1512 1387 2009 11 JUNEAU KAKE AJA 0 35 10 17 876 1772 592 552 2009 11 JUNEAU KAKE AJA 4 16 16 39 2309 4467 813 765 549 1156 49619 87037 28433 26280 CARAVAN 4 16 247 725 27919 51761 12127 11087 C-207 0 35 302 431 21700 35276 16306 15193

### 2 Appendix A Page 2 of 2

ALASKA JUNEAU AERONAUTICS T-100 SEGMENT REPORTS 12 MONTHS ENDED NOVEMBER, 2009

2008 12 KAKE JUNEAU AJA 0 35 19 33 339 1115 963 918 2008 12 KAKE JUNEAU AJA 4 16 13 39 889 1100 533 501 2009 1 KAKE JUNEAU AJA 0 35 9 12 278 270 440 409 2009 1 KAKE JUNEAU AJA 0 35 1 1 0 66 54 51 2009 1 KAKE JUNEAU AJA 4 16 7 18 392 524 283 262 2009 2 KAKE JUNEAU AJA 0 35 11 10 287 167 526 496 2009 2 KAKE JUNEAU AJA 4 16 13 44 325 729 575 543 2009 3 KAKE JUNEAU AJA 0 35 29 38 392 869 1369 1283 2009 3 KAKE JUNEAU AJA 0 35 1 1 0 15 58 56 2009 3 KAKE JUNEAU AJA 4 16 5 28 167 669 202 188 2009 4 KAKE JUNEAU AJA 0 35 35 70 508 659 1727 1636 2009 4 KAKE JUNEAU AJA 4 16 15 48 356 424 669 623 2009 5 KAKE JUNEAU AJA 0 35 62 103 4175 905 3156 2941 2009 5 KAKE JUNEAU AJA 4 16 9 39 175 406 405 377 2009 6 KAKE JUNEAU AJA 0 35 43 62 2541 856 2154 2032 2009 6 KAKE JUNEAU AJA 4 16 30 83 3756 477 1335 1231 2009 7 KAKE JUNEAU AJA 0 35 47 71 1743 1407 2488 2345 2009 7 KAKE JUNEAU AJA 4 16 23 61 1579 320 1003 921 2009 8 KAKE JUNEAU AJA 0 35 27 28 972 427 1391 1305 2009 8 KAKE JUNEAU AJA 4 16 37 94 2013 960 1670 1547 2009 9 KAKE JUNEAU AJA 0 35 7 15 119 219 335 313 2009 9 KAKE JUNEAU AJA 4 16 48 90 3448 1254 2241 2097 2009 10 KAKE JUNEAU AJA 0 3 5 2 7 70 4 104 95 2009 10 KAKE JUNEAU AJA 4 16 30 125 6326 1260 1339 1250 2009 11 KAKE JUNEAU AJA 0 35 10 26 329 256 470 441 2009 11 KAKE JUNEAU AJA 4 16 16 82 2633 853 676 638 549 1228 33812 16211 26166 24499 CARAVAN 4 16 246 751 22059 8976 10931 10178 C-207 0 35 303 477 11753 7235 15235 14321

TOTALS 1098 2384 83431 103248 54599 50779 CARAVAN 44.90% 4 16 493 1476 49978 60737 23058 21265 C-207 55.10% 0 35 605 908 33453 42511 31541 29514

### 3 Appendix B Page 1 of 1

ALASKA JUNEAU AERONAUTICS T-100 MARKET REPORTS 12 MONTHS ENDED NOVEMBER, 2009

YR MO ORI DEST CARR PAX FRT MAIL 2008 12 JUNEAU KAKE AJA 50 4362 9407 2009 1 JUNEAU KAKE AJA 37 2715 5082 2009 2 JUNEAU KAKE AJA 69 4099 7497 2009 3 JUNEAU KAKE AJA 53 3169 7031 2009 4 JUNEAU KAKE AJA 111 4558 6507 2009 5 JUNEAU KAKE AJA 116 4084 7655 2009 6 JUNEAU KAKE AJA 169 5200 6568 2009 7 JUNEAU KAKE AJA 142 4634 8016 2009 8 JUNEAU KAKE AJA 124 3885 7072 2009 9 JUNEAU KAKE AJA 107 4458 7103 2009 10 JUNEAU KAKE AJA 117 5104 8695 2009 11 JUNEAU KAKE AJA 56 3185 6239 2008 12 KAKE JUNEAU AJA 72 1228 2215 2009 1 KAKE JUNEAU AJA 31 670 860 2009 2 KAKE JUNEAU AJA 54 612 896 2009 3 KAKE JUNEAU AJA 67 559 1553 2009 4 KAKE JUNEAU AJA 118 864 1083 2009 5 KAKE JUNEAU AJA 142 4350 1311 2009 6 KAKE JUNEAU AJA 145 6297 1333 2009 7 KAKE JUNEAU AJA 132 3322 1727 2009 8 KAKE JUNEAU AJA 119 2937 1329 2009 9 KAKE JUNEAU AJA 105 3567 1473 2009 10 KAKE JUNEAU AJA 132 6396 1264 2009 11 KAKE JUNEAU AJA 108 2962 1109 TOTALS 2376 83217 103025