Order: 2014-3-6

Served: March 11, 2014

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

By this Order, the Department is requesting proposals from air carriers interested 

in providing Essential Air Service (EAS) at Victoria, Texas, for a new contract

period beginning October 1, 2014, with or without subsidy. (See Appendix A for 

a map). Air carriers should file their proposals no later than April 16, 2014.

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 11th of March, 2014

ORDER REQUESTING PROPOSALS

Summary

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

Essential Air Service (EAS) at Victoria, Texas, for a new contract period beginning 

October 1, 2014, with or without subsidy. (See Appendix A for a map). Air carriers should 

file their proposals no later than April 16, 2014.

Background

By Order 2012-7-17 (July 13, 2012), the Department selected Sun Air Express, LLC d/b/a 

Sun Air International (Sun Air) to provide EAS at Victoria to George Bush Intercontinental 

Airport (Houston or IAH) using 9-passenger, twin engine Piper Chieftain aircraft for a twoyear period beginning when the air carrier commenced full EAS.1 Under that Order, Sun Air 

provides Victoria with 24 weekly nonstop round trips for an annual subsidy of $2,294,036.

The complete public file for EAS at Victoria may be accessed online through the Federal 

Dockets Management System at: www.regulations.gov by entering “DOT-OST-2005-20454” 

in the “Search for Rules, Comments, Adjudications, or Supporting Documents” field.

Special discussion concerning Victoria’s subsidy per passenger

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 

 1 Sun Air started full EAS on October 1, 2012, thus making the contract expiration date September 30, 2014.

Essential Air Service at

VICTORIA, TEXAS

Under 49 U.S.C. § 41731 et seq.

Docket DOT-OST-2005-20454
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nearest large or medium hub airport. Victoria is 124 miles from IAH (a large hub airport) and 

based on FY2013 data (October 1, 2012, through September 30, 2013), 6,518 passengers were 

enplaned and deplaned at Victoria. The annual subsidy amount for Victoria is $2,294,036. 

Therefore, the subsidy per passenger at Victoria is $352, above the subsidy per passenger 

ceiling. Rather than terminate the community’s eligibility at this stage, the Department will 

solicit proposals for EAS and evaluate all proposals submitted before either committing to a 

two-year contract or making a final determination on Victoria’s continuing eligibility to 

receive EAS in light of its current subsidy per passenger being above the $200 ceiling. Before 

the due date for proposals, we expect the community to work aggressively with all potential 

applicants to mitigate some of the risks that the air carriers may face in an attempt to lower 

their subsidy levels. We also expect air carriers to detail in their proposals how they will work 

with the community in getting the subsidy per passenger under the $200 cap.

Request for Proposals

As the end of the current contract approaches, the Department is requesting proposals from air 

carriers interested in providing EAS at Victoria with subsidy support if necessary, for a new 

contract period beginning October 1, 2014. Carriers should file their proposals no later than 

April 16, 2014. Staff will then docket the proposals, thereby making them public. Shortly 

afterwards, we will provide a summary of the proposals to the community and ask them to 

submit their final comments. We will give full consideration to all proposals that are timely 

filed.2

Interested air 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 and 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. Air carrier proposals should be submitted to the Department with all materials 

merged into a single document. In addition, because the document will be published on 

www.regulations.gov, each page should be formatted to be viewed online. 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, we recommend they include information concerning proposed 

schedules and projected block hours. In addition, applicants are urged to provide financial 

data supporting their subsidy requests, including information on their projected expenses and 

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

EAS without subsidy and we determine that basic EAS, as required by 49 U.S.C. § 41732, can be reliably 

provided without such compensation, we typically will not proceed with the carrier-selection case. Instead, we 

simply rely on that carrier’s subsidy-free service as proposed.
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revenues. We strongly encourage clear, well-documented proposals that will facilitate their 

evaluation by the affected communities and the Department.3

Proposals should provide sufficient capacity to accommodate historical levels of traffic. In 

order to assist air carriers in developing traffic and revenue projections for their proposals, we 

have provided a summary of historical passengers in Appendix B. During the year ended 

September 30, 2013, Victoria enplaned and deplaned a total of 6,518 passengers. The 

Department expects proposals that are consistent with what the community currently receives,

with service to a large- or medium-hub airport that provides numerous connecting 

opportunities to the national air transportation system. Specifically, air carriers should 

propose two daily round trips (12 a week) with 30-passenger or larger aircraft. For air carriers 

proposing service with 15-seat to 29-seat aircraft, we expect three daily round trips (18 a 

week). We would also consider proposals with 8/9-seat aircraft and additional frequencies. 

Air carriers are also welcome to propose more than one service option, if they choose. They

also need not limit themselves to these requirements if they envision other, potentially more 

attractive service possibilities -- different hubs or length of contract, for example -- with 

subsidy requirements that remain competitive.

Community Comments

The community and State is welcome to submit comments at any time. We encourage 

prospective applicants to contact the community before they submit their proposals so that 

they can tailor them to the community’s needs, as they will not be able to amend them after 

the due date. As noted earlier, we will provide a summary of the proposals to the civic parties 

shortly after the deadline for carrier proposals, and ask them to submit their final comments.

Other Carrier Requirements

The Department is responsible for implementing various Federal statutes governing lobbying 

activities, drug-free workplaces, and nondiscrimination.4 Consequently, all carriers receiving 

Federal subsidy for EAS must certify that they are in compliance with Department regulations 

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

 3 In selecting a carrier to provide subsidized EAS for an eligible place not in Alaska, 49 U.S.C. § 41733(c)(1) 

directs us to consider five factors: (a) service reliability; (b) contractual and marketing arrangements with a 

larger carrier at the hub; (c) interline arrangements with a larger carrier at the hub; (d) community views, giving 

substantial weight to the views of the elected officials representing the users; and (e) whether the carrier has 

included a plan in its proposal to market its service to the community. In addition, the Consolidated 

Appropriations Act, 2014, Public Law No. 113-76, 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.

4 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; (3) 49 CFR Part 27 -- Nondiscrimination on the Basis of 

Disability in Programs and Activities Receiving or Benefiting from Federal Financial Assistance; (4) 

14 CFR Part 382 -- Nondiscrimination on the Basis of Disability in Air Travel; and (5) 49 CFR Part 29 --

Government-Wide Debarment and Suspension (Non-Procurement) and Government-Wide Requirements for 

Drug-Free Workplace (Grants).
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exceed $100,000 over the life of the contract 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) 366-5903.5

This Order is issued under authority delegated in 49 CFR Part 1.25a(b) and re-delegated to the 

Director, Office of Aviation Analysis.

ACCORDINGLY,

1. We request that carriers interested in providing Essential Air Service at Victoria, Texas,

submit their proposals, with subsidy support if necessary, no later than April 16, 2014. The 

proposals should be e-mailed to: michael.f.martin@dot.gov with the title “Proposal to 

Provide EAS at Victoria, Texas”;6

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

3. We will serve copies of this Order on the mayor of Victoria, Texas, the airport manager of 

Victoria Regional Airport, and the service list for this docket.

Persons entitled to petition the Department for review of this Order under the Department’s 

Regulations, 14 CFR Part 385.31(a), must file such petitions within seven (7) 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 is available

online at www.regulations.gov. 

 5 The certifications are also available on the web at http://www.dot.gov/policy/aviation-policy/small-communityrural-air-service/essential-air-service. 

6 Questions regarding filings in response to this Order may be directed to Michael Martin at (202) 366-6494 or

michael.f.martin@dot.gov. 
Appendix A

AREA MAP

Maps generated by the Great Circle Mapper - copyright © Karl L. Swartz.
Appendix B

Victoria, Texas1

Quarter Year Deplanements Enplanements Total Traffic

4 2009 1,346 1,372 2,718

1 2010 1,095 1,208 2,303

2 2010 1,270 1,303 2,573

3 2010 1,246 1,260 2,506

Annual 

Totals 4,957 5,143 10,100

4 2010 1,314 1,267 2,581

1 2011 920 1,028 1,948

2 2011 1,325 1,373 2,698

3 2011 1,391 1,447 2,838

Annual 

Totals 4,950 5,115 10,065

4 2011 1,400 1,350 2,750

1 2012 1,289 1,404 2,693

2 2012 1,395 1,509 2,904

3* 2012 0 0 0

Annual 

Totals 4,084 4,263 8,347

4** 2012 842 842 1,684

1 2013 750 818 1,568

2 2013 805 898 1,703

3 2013 759 804 1,563

Annual 

Totals 3,156 3,362 6,518

* Victoria had no air service during 3Q2012.

** For 4Q2012, data showed that 1,684 passengers enplaned at Victoria but 0 passengers deplaned. We assume this to be a 

reporting error on the part of Sun Air, and that, in fact, 1,684 is the total passengers enplaned and deplaned at Victoria. We 

simply divided 1,684 by 2 to determine a reasonable estimate of passengers deplaned and enplaned.

 1 Source: Bureau of Transportation Statistics; Schedule T-100
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 complete, 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.

Funds may not be available for performance under this Order beyond [DATE]. The Government’s 

obligation for performance under this Order beyond [DATE], 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 under this Order beyond [DATE], until funds are made 

available to the Department for performance. If sufficient funds are not made available for 

performance beyond [DATE], the Department will provide notice in writing to the carrier.

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.

All claims for payment, including any amended 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 31st; August claims must be submitted by November 30th, and so on.