BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

__________________________________________ __ Application of ) US AIRWAYS, INC. ) f or an exemption pursuant to 49 U.S.C. § 41718 (b) ) ) For service between Oklahoma City (OKC) and ) Docket DOT
- OST
- 2000
- 7182 Ronald Reagan Washington National Airport (DCA) )

__________________________________________ __

ANSW E R OF OKLAHOMA CITY DEPARTMENT OF AIRPORTS IN SUPPORT OF THE APPLICATION OF US AIRWAYS TO SERVE RONALD REAGAN WASHINGTON NATIONAL AIRPORT

_____________ FROM WILL RO GERS WORLD AIRPORT

_____________

Communications with respect to this document should be sent to:

Mark Kranenburg Director of Airports Oklahoma City Department of Airports 7100 Terminal Drive Oklahoma City, OK 73159 Mark.kranenburg@okc.gov Direct phon e: (405) 316

- 3200

December 19 , 20121 BEFORE THE U.S. DEPARTMENT OF TRANSPORTATION

WASHINGTON, D.C.

__________________________________________ __ Application of ) US AIRWAYS , INC. ) f or an exemption pursuant to 49 U.S.C. § 41718 (b) ) ) For service between Oklahoma City (OKC) and ) Docket DOT
- OST
- 2000
- 7182 Ronald Reagan Washington National Airport (DCA) )

__________________________________________ __

INTRODUCTION On December 5, 2012, US Airways, Inc. (US Airways ) applied for two slot exemptions at Ronald Reagan Washington National Airport (DCA) to initiate the only non

- stop service between DCA and Oklahoma Ci ty Will Ro gers World Airport (OKC), a small hub airport as classified by the FAA ( 1 ) . These slot exemptions authorize service to a medium

- hub or smaller airport within the 1,250

- mile perimeter established for civil operation at DCA, under Title 49
U.S. C. § 49109.
In addition, upon an award of these slot exemptions, US Airways proposes to initiate two daily

non - stop departures between OKC and Charlotte

- Dou glas International Airport (CLT)

– which would also represent the only two non

- stop departures in this ma rket

. Details of US Airways’ service proposal are as follows:

ROUTE S : DCA

- OKC and CLT

- OKC
SCHEDULE: Westbound: 13:50 DCA

– 16:10 OKC

Eastbound: 16:40 OKC

– 20:30 DCA Westbound: 11:15 CLT

– 12:47 OKC

(1) Note that for purposes of AIR 21/Vision 100 slot exemption applicat ions, OKC is considered a medium hub airport under the 1997 hub classifications2 Eastbound: 13:30 OKC

– 16:48 CLT Westbound: 20:30 CLT

– 22:02 OKC Eastbound: 07:15 OKC

– 10:33 CLT
AIRCRAFT: OKC

- DCA service to be operated with mainline E

- 190 aircraft

OKC

- CLT service to be operated with CRJ

- 700 and CRJ

- 900 aircraft

APPLICATION MEETS STATUTORY CRITERIA As per its filing, US Airways’ proposed service would significantly advance the statutory goals
of AIR

- 21 and Vision 100 by providing the “maximum competitive benefits to a small community that lacks non stop DCA air transportation”. In addition (and again per US Ai rways’ Application ), US Airways’ “three

- for

- one” service proposal “not only provides first

- ever

non stop service between OKC and DCA, but also links OKC with US Airways’ largest hub in
CLT and over 125 con necting destinations ( 21 international) ” . This new portfolio of service will
lead to substantial consumer benefits.

OKLAHOMA CITY

– AN ECONOMIC SUCCESS STORY With a Metropolitan Statistical Area ( MSA ) population of just under 1.3 million people, th e Oklahoma City region is the 43rd largest MSA in the Unite d States ( 2 )

. P opulation in the region grew at over 14% from 2000

- 2010, an above

- average figure across the top 50 metropolitan areas. The Oklahoma City region extends into Canadian, Cleveland, Oklahoma , and Pottawatomi e counties, which include many rural and suburban communities

. Oklahoma City is a city that has invested in itself. Much of its “above

- average” growth is due to
a series of voter

- approved sales tax initiatives called the Metropolitan Area Projects (MAPS), a visionary capital improvement program that revitalized the community along with its national image. Over a period of nine years, MAP S has funded new and upgraded sports, recreation, entertainment, cultural , and convention facilities, as well as infrastructure improvements for all

(2) U.S. Census

– 2011 estimate3

Oklahoma City public schools. The citizens of Oklahoma City have voted three times in favor of
the se proje cts, providing an investment of $1.84 billion in community enhancements and spurring over $5 billion in private sector investments. Oklahoma City and MAPS ha ve become a
national model for other communities looking to grow and revitalize their cities.

Okla homa City is the primary economic engine for this region , as well as the entire state of Oklahoma, producing over 50% of the state’s job growth since 2009. Oklahoma C ity’s economic profile remains disproportionately strong when compared t o the rest of the United States, in terms of total performance as well as recent growth. A partial list of the region’s accomplishments includes:

 Ranked 6 th best among metropolitan area s for performance during the economic recovery of 2009

- 2010 by The Brookings Institute

– based on unemployment rate, job creation, housing prices , and the value of goods and services provided ;

 Produced the lowest unemployment rate of any U.S. region of over 1 million people fo r 18 of the last 22 months , and finished among the three lowest for each month over the last three years ; and

 Generated an unemployment rate approximately three percentage points lowe r than the national average in October 2012 (4.9% vs. 7 .9%)
Many of the region’s largest employers have significant ties to the Washington, DC area , driving
enhanced economic benefit to the region from the proposed new service (an estimated 5% of total employment in the Oklahoma City region is driven by the federal government) :

 As the state’s capital, Oklahoma City ha s the greatest concentration of government agencies and offices located within the state;4  Tinker Air Force Base is Oklahoma’s largest single site employer (27,000) , with the largest group of civi lian Air Force personnel in the United States ; and

 The FAA’s Mike Monroney Aeronautical Center is one of the Department of Transportation’s largest facilities located outside of the Washington, DC area . In addition, energy, aviation/aerospace , and bioscience each have a strong presence in the region

- and are all growing at a rapid rate. H ighlights include:

 Oklahoma is now one of the top ten states in traditional aerospace occupation employment , with more than 300 public and private

- sector aviation and aerospace
firms ;

 Oklahoma ranks twelfth nationally in the number of aerospace engineers, fifth in aircraft mechanics and service technicians, and eighth in avionics technicians ;

 The Boeing Company has recently relocated 1,200 high

- level jobs t o Oklahoma City from California, and has started relocating another 300 employees from Wichita; th ese moves will double its employee base in the community ;

 Oklahoma City is home to the headquarters of two Fortune 500 energy companies ; and

 Bioscience remai ns one of the fastest growing sectors, employing over 26,000 in health care, research, education, and technology

. Oklahoma City has recently been la uded with several econ omic growth and quality of life

- type headlines and honors, including:

 “ Oklahoma City ranked in the top ten in manufacturing growth ”

- U.S. Bureau of Labor Statistics, February 2012 ;5  “ Only 13 of top 100 metro areas have bounced back from the recession ”

- U.S. Bureau of Labor Statistics, February 2012 ;

 “ 10 Great Cities for Starting a Busines s ”

- Kiplinger, December 2011 ;

 “ Fourth Best City for a Job Search ”

- BenefitsPro, October 2011 ; and

 “ Top 10 Best Places To Live ”

- RelocateAmerica, August 2011

. Numerous community leaders and representatives from the region’s major employers have
written l etters of support for US Airways’ application to serve the OKC

- DCA market . T hese can
be found in Exhibit A

.
In summary, the economic profile and growth trajectory of the Oklahoma City market remains perfectly positioned to take maximum advantage of the benefits from non

- stop service to DCA.

WILL ROGERS WORLD AIRPORT OKC is Oklahoma City’s commercial airport, generating nearly 1.8 million enplanements in 2011 ( a 3% increase from 2010 )

. OKC is the largest FAA

- designated small

- hub airport , and represents the primary commercial facility for a large portion of the state of Oklahoma

. OKC is typically a medium

- to

- high load factor airport, with an aggregate twelve

- month figure of 77% and several routes operating at 80% or higher ( 3 )

. As of December 2012, airlines serving OKC operate over 67 d aily departures to a total of 21 non - stop destinations

- increasing to 75 daily departures by Summer 2013 ( 4 )

. OKC sits on 8,100 acres with thr ee active runways , and is home to 67 tenants and more than 10,000 employees. In 2006, the airport completed a $110 million terminal expansion/renovation project, transforming the 1967 terminal building into a modern, passenger

- friendly facility. T wo significant projects are currently in the d esign and engineering phase which will further enhance

(3) U.S. DOT T100 data; YE August 2012 (4) Innovata schedule data via Diio online portal; includes seasonal adds6

the passenger an d security experience at OKC . The first project is a new $35 million consolidated rental car facility , which will provide much needed capacity and smoother operations for inbound tra velers. The second is a new $25 million baggage inspection syst em , which will more efficiently and effectively screen passenger bags.

THE OKLAHOMA CITY

– DCA MARKET Oklahoma City currently generates approximately 25% more traffic to DCA than any other city/metropolitan area located inside of the 1,250

- mile DCA perimeter lacking non

- stop service

. Top 10 markets inside the DCA perimeter without n on - stop service to DCA Annual Pas sengers per Day Each Way (PDEWs) for YE 2Q2012 Schedule data as of December 2012
Market PDEWs to DCA Oklahoma City (OKC) 53.9 Grand Rapids (GRR) * 42.9 Wichita (ICT) 35.7 Tulsa (TUL) 35.3 Baton Rouge (BTR) 30.7 Gulfport (GPT) 28.5 Moline (MLI) 24.8 Montgomery, AL (MGM) 23.4 Cedar Rapids (CID) 22.3 Bloomington

- Normal, IL (BWI) 21.0 Source: US DOT O&D s urvey and Innovata schedule data via Diio online portal * Market offered non

- stop service at some point during twelve

- month reporting period (min. 10 departures)
Despite this lack of non - stop service ( and also despite daily non

- stop flights from OKC to both
BWI and IAD ) , the OKC

- DCA market generated 54 passengers per day each way (PDEWs) during the year ended June 30, 2012 ( YE 2Q12 ) . Given that all of these passengers trav eled on connecting itineraries

- cho osing to bypass non

- stop options to BWI and IAD

- it is clear that DCA is a critical destination for the Oklahoma City community. Also of note is th at Oklahoma City remains the largest inside

- the

- perimeter state capital market lacking non

- stop service to
DCA ( 5 ) , a key destination for many government stakeho lders. While residents of smaller

(5) Innovata schedule data via Diio online portal7

inside

- the

- perimeter capitals such as Columbia (SC), Tallahassee (FL), and Lansing (MI) enjoy

non - stop DCA service, Oklahoma City residents do not currently have non

- stop access to this important destination.
Many of Oklahoma City’s peer regions (as defin ed by MSA population) located inside of the DCA perimeter currently support service to BWI, IAD and DCA

– including Raleigh/Durham (RDU), New Orleans (MS Y), Nashville (BNA), and Jacksonville (JAX ) . Given the existing
OKC

- DCA passenger numbers in the absen ce of non

- stop se rvice, Oklahoma City can also easi ly support service fro m all three Washington airports

. Oklahoma City “P eer MSAs”

– service t o Washington area airports Only markets inside the DCA perimeter are listed

– schedule data as of December 2012 MSA rank MSA MSA population (000s) Primary

airport IAD

non - stop service DCA

non - stop service BWI

non - stop service 36 Virginia Beach

- Norfolk

- Newport News, VA

- NC 1,679.9 ORF Yes Yes Yes
37 Nashville

- Davidson

- Murfreesboro

Franklin, TN 1,617.1 BNA Yes Yes Yes
38 Providence

- New Bedford

- Fall River, RI

MA 1,600.2 PVD Yes Yes Yes
39 Milwaukee

- Waukesha

- West Allis, WI 1,562.2 MKE No Yes Yes 40 Jacksonville, FL 1,360.3 JAX Yes Yes Yes 41 Memphis, TN 1,325.6 MEM No Yes No 42 Louisville

- Jefferson County, KY

- IN 1,294.8 SDF Yes Yes Yes 43 Oklahoma City, OK 1,278.1 OKC Yes No Yes 44 Richmond, VA* 1,269.4 RIC Yes No * No 45 Hartford

- West Hartford

- East Hartford, CT 1,213.3 BDL Yes Yes Yes 46 New Orleans

- Metairie

- Kenner, LA 1,191.1 MSY Yes Yes Yes 47 Raleigh

- Cary, NC 1,163.5 RDU Yes Yes Yes 49 Buffalo

- Niagara Falls, NY 1,134.0 BUF Yes Yes Yes 50 Birmingham

- Hoover, AL 1,132.3 BHM No Yes Yes 51 Rochester, NY 1,055.3 ROC Yes Yes Yes * Note that the stage le ngth from RIC to DCA is 94 miles Source: U.S. Census (2011 estimate) and Innovata schedule data via Diio online portal8

THE STATE OF OKLAHOMA LACKS NON
- STOP SERVICE TO DCA As detailed in Exhibit B , Oklahoma remains the most populated insi de

- the

- perimeter state without non

- stop service to DCA

. As such , US Airways’ proposed service will stimulate and carry traffic from a broad catchment area spanning other parts of the state . This will include smaller outlying communities wi th significant connections to Washington, DC, such as Norman (hom e to the University of Oklahoma), Stillwater (home of Oklahoma State University), and
Enid (home of Vance Air Force Base). In addition, the Tulsa metropolitan area

- home to nearly 950,000 residents

- lies less than two hours northeast of OKC on Interstat e 44. For the YE 2Q12 , an additional 35 PDEWs traveled from Tulsa International (TUL) to DCA, bringing the PDEW total from the two airports to 89

– all on connecting itineraries

. In summary, non

- stop OKC

DCA service will provide significant benefits across much of Oklahoma.

HOUSTO N AND JACKSONVILLE PASSENGERS CURRENTLY BENEFIT FROM NON
- STOP DCA SERVICE Unlike the Oklahoma City market, Housto n and Jacksonville already enjoy non - stop service to DCA, as well as a broad array of flights to all three Washi ngton airports. US Airways’ proposed service to OKC represents the only current opportunity for the U.S. Department of Transportation to bring DCA service to an unserved metropolitan area

.
NEW SERVICE FROM OKLAHOMA CITY TO US AIRWAYS’ CHARLOTTE HUB As part of this service offering, US Airways also proposes twice daily service from OKC to its
hub at CLT, which currently serves over 125 destinations

– including 21 international markets

across Europe, Central and South America, and the Caribbean. For the period YE 2Q12, approximately 19 PDEWs traveled between OKC and CLT

– all on connecting itineraries

. However, over that same period, a s ubs et of Oklahoma City’s peer MSAs (based on population )9

which offered non - stop US Airways service to CLT ge nerated on average just under 100
PDEWs , demonstrating the likely traffic growth this new service will drive.
Oklahoma City “Peer MSAs”
- Traffic Flows to CLT ( YE 2Q12)
MSA rank MSA /Airport Primary airport PDEWs to

CLT Non
- stop to

CLT* * 38 Providence

- New Bedford

- Fall River, RI

MA PVD 152.2 Yes
39 Milwaukee

- Waukesha

- West Allis, WI MKE 113.4 Yes 40 Jacksonville, FL JAX 83.3 Yes 41 Memphis, TN MEM 91.9 Yes 42 Louisville

- Jefferson County, KY

- IN SDF 62.9 Yes 43 Oklahoma City, OK OKC 18.9 No 44 Richmond, VA RIC 54.9 Yes 45 Hartford

- West Hartford

- East Hartford, CT BDL 149.6 Yes 46 New Orleans

- Metairie

- Kenner, LA MSY 123.3 Yes 47 Raleigh

- Cary, NC RDU * Yes 48 Salt Lake City, UT SLC 64.6 Yes

Average (non
- OKC) : 99.6 * RDU is only 130 miles from CLT ; O&D totals not included in average * * Schedule references are for July, 2012 (historical)
Source: US DOT O&D s urvey and Innovata schedule data via Diio online portal
In addition, OKC generated over 1,000 PDEWs to domestic markets US serves from CLT which would provide geographically reasonable connections to OKC passenge rs

– a figure which does not even take into account the previously mentioned 21 international de stin ations

.
US AIRWAYS WOULD RE PRESENT A NEW CARRIER FOR OKC In addition to the fact th at Oklahoma City is an ideal market for new DCA non - stop s ervice, the proposed service profil e from US Airways would in many ways optimize potential benefits to the Oklahoma City region . Key reasons include:10

New carrier for OKC

The commence ment of service detailed in this proposal would i ntroduce service to OKC from
the only major network carrier not currently serving the airport , providing the region’s travelers
with new access to US Airways’ extensive dome stic and international network

.
Additional non - stop market

T his proposal offers a “three

- for

- one” service introduction

– including service to the third largest
hu b in the United States ( US at CLT) , which operates non

- stop to over 125 destinations across
three continents. This proposal is the only one in this current process which offers service to a market in addition to DCA.

T wo - class aircraft
US Airways proposes to serve the OKC

- DCA market with 99

- seat mainline E

- 190 aircraft, and the OKC

- CLT market with CRJ

- 900 (79 seats) and CRJ

- 700 (67 seats) aircraft. All of the
propose d flights will offer two

- class service, which is of particular importance to key frequent
flier and busi ness traveler segments. All proposed aircraft are also Stage 3 compliant.
Analysis of projected incremental traffic
US Airways included in their application the projected incremental traffic volume to the Oklahoma City regio n from the two proposed new routes . Their findings included:

 Over 56,000 annual passengers generated on the new OKC

- DCA service, driven by a segment load factor of 78% ; and

 Over 84,000 annual passengers generated on the new OKC

- CLT service, driven by a segment load factor of 79%

.12

E XHIBIT A
The following parties submitted letters of support for this application:

 Mark Kranenburg, Director of Airports, City of Oklahoma City Department of Airports
 Oklahoma U.S. Congressional Delegation
 Mary Fallin, Governor, State of Oklahoma
 Senator Brian Bingman, President Pro Tempore, Oklahoma State S enate
 Representative T.W. Shannon, Speaker

- elect, Oklahoma House of Representatives
 Mick Cornett, Mayor of the City of Oklahoma City
 Larry McAtee, Councilman, Ward 3, City of Oklahoma City; Trustee, Oklahoma City Airport Trust
 Gary Marrs, Councilman, Ward 1, City of Oklahoma City; Surrogate Trustee, Oklahoma City Airport Trust
 Brad Henry, Former Governor of the State of Oklahoma
 David L. Boren, President, University of Oklahoma; Former Governor of the State of Oklahoma; Former Oklahoma U.S. Senator
 David Wa lters, President, Walters Power International; Former Governor of the State of Oklahoma
 James D. Couch, City Manager, City of Oklahoma City; Trustee, Oklahoma City Airport Trust
 Kirk Humphreys, Chairman, The Humphreys Company; Vice Chairman, Oklahoma City Airport Trust; Former Mayor of Oklahoma City
 Terry Salmon, President, Computer System Designers; Trustee, Oklahoma City Airport Trust
 Roy Williams, President, Greater Oklahoma City Chamber of Commerce
 J. Larry Nichols, Executive Chairman, Devon Energy Co rporation
 William E. Durrett, Senior Chairman of the Board, American Fidelity Corporation
 Rick Bott, President and Chief Operating Officer, Continental Resources
 Peter Delaney, Chairman, President and CEO, OGE Energy Corporation
 C. Bruce Lawrence, Presiden t and CEO, Integris Health
 Sheri Stickley, President and CEO, Oklahoma Bioscience Association
 Rhonda Hooper, President & CEO, Jordan Advertising
 Ronald Perry, President, Prime Time Travel
 Michael C. Turpen, Attorney, Riggs, Abney, Neal, Turpen, Orbison & L ewis
 LeAnn Jenkins, Executive Director, Oklahoma Federal Executive Board
 Kelly Brander, President and CEO, Arvest
 Robert C. Zahl, Zahl

- Ford, Inc.
 Berry Johnson, Citizen, City of Oklahoma City13

EXHIBIT B Air service to DCA

– “inside
- the
- perimeter” states with population over three million Schedule data as of December 2012
State Po pulation (000s) Non
- stop

markets to DCA Texas 25,146 3 New York 19,378 8 Florida 18.801 12 Illinois 12,831 1 Pennsylvania 12,702 2 Ohio 11,537 4 Michigan 9.884 2 Georgia 9,688 3 North Carolina 9.535 6 New Jersey 8.792 1 Massachusetts 6,548 1 Indiana 6,484 1 Tennessee 6,346 4 Missouri 5,989 2 Wisconsin 5,687 2 Minnesota 5,304 1 Alabama 4,780 2 South Carolina 4,625 4 Louisiana 4,533 1 Kentucky 4,339 3 Oklahoma 3,751 0 Connecticut 3,574 1 Iowa 3,046 1 Note: Virginia and Maryland not included due to proximity to DCA

Source: U.S. Census (2010 ) and Innovata schedule data via Diio online portal