Order 2013

- 10

- 14 Served: October 28, 2013



### UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation on the 28 th of October, 2013

Essential Air Service at DEVILS LAKE, N ORTH DAKOTA JAMESTOWN, NORTH DAKOTA

Under 49 U.S.C. 41731 et seq

. DOCKET DOT

- OST

- 1997

- 2785

ORDER REQUESTING PROPOSALS
Summary By this Order , the Department is requesting proposals by November 26 , 2013
, from carriers interested in providing Esse ntial Air Service (EAS) at Devil s Lake and Jamestown, North Dakota
, beginning April 1 , 2014, for a period of two or more years
, with or without subsidy. Carriers should file their proposals no later than November 26, 2013.
Background By Order 2012

- 1

- 17, January 23, 2012, we selected Great Lakes Aviation, Ltd. (Great Lakes) , to provide 18 nonstop round trips per week with 19

- seat Beech 1900 aircraft between Jamestown and Minneapolis /St. Paul International Airport, MSP (Minneapolis), for a two

- year period f rom the start of its service for an annual subsidy of $1,987,655. As the carrier inaugurated service in mid

- March 2012, the rate is set to end on March 31, 2014.
By Order 2011

- 12

- 6, December 14, 2011, we selected Great Lakes to provide 14 nonstop round t rips per week between Devils Lake and Minneapolis with 19

- seat Beech 1900 aircraft until further Department action for an annual subsidy of $2,797,467

. 1 Order 2012

- 11

- 25, November 21, 2012, specified March 31, 2014, as the end of the contract
, thereby ma king the rates at the two communities expire at the same time.
Request for Proposals As the end of the current rate term approach es , we are requesting proposals from carriers int erested in providing service at Devils Lake and/or Jamestown
, with or witho ut subsidy, for the period beginning April 1 , 2014 . Carriers should file their proposals by

1 According to published schedules, in addition to the 14 nonstop round trips each week, Great Lakes currently provides 7 one

- stop round trips between Devils Lake and Minneapolis, on an unsubs idized basis.- 2

-

November 26 , 2013

. S taff will then docket the proposals, thereby making them public. Shortly afterwards, we will provide a summary of the proposals to the commun ities and ask them to submit their final comments. We will give full consideration to all proposals filed in a timely manner. 2 Interested carriers should prepare their proposals with every expectation that their initial proposals will also be their final and only 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.
We are here providing interested carriers with some basic information to serve as guidance when they prepare their proposals, but we will not prescri be a precise format for their proposals. We expect proposals to adequately describe the service being proposed and the annual amount of s ubsidy being requested. The applicants can make their own judgments as to the level of detail they wish to present; h owever, we recommend that 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 an d revenues. We strongly encourage clear, well

- documented proposals that will facilitate their evaluation by the communities and the Department. 3
As always, we will formally solicit the communities ’ views on any service options we receive before making a long

- term , carrier

- selection decision. The communities and air carrier s are encouraged to work together in advance of the due date for proposals to craft a service pattern that is both desirable to the communities and meets the operational needs of the airlines, as carriers cannot amend their proposal s after the due date.
With specific respect to Devil s Lake, the Department expects proposals consisting of two nonstop round trips each day (1 4 total per week) to Minneapolis. At Jamestown, we expect three nonstop or one

- stop round trips each day (18 total per week) to Minneapolis utilizing 19

- seat aircraft. For service using larger aircraft, two one

- stop round trips each weekday and weekend (12 total per week) would be sufficient to accommodate rec ent tra ffic levels at each community . We encourage proposals that meet those 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 requirements specified

2 Carriers should not expect the Department to accept late filings. In cases where a carrier proposes to provide E AS without subsidy and we determine that basic EAS
, as required by 49 U.S.C. § 41732
, can be reliably provided without such comp ensation, we typically do not proceed with the carrier

- selection case. Instead, we simply rely on that carrier’s subsidy

- free service as proposed. 3 In selecting a carrier to provide subsidized EAS for an eligible place not in Alaska , 49 U.S.C. § 41733(c) directs us to consider five 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; (4) communit y views; and (5) whether the carrier has in cluded a plan in its proposal to market the service. In addition , The Consolidated and Further Continuing Appropriations Act, 2012, Public Law No. 112

- 55, and continued by the Full

- Year Continuing Appropriations Act, 2013, Public Law No. 113

- 6, and Continu ing Appropriations Act, 2014, Public Law No. 113

- 46 , 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 EAS 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.- 3

-

ab ove if they envision other, potentially more attractive service possibilities

– different hubs, for example

– with subsidy requirements that remain competitive.
Filing Format Carrier proposals should be submitted to the Department with all materials merge d into a single document. In addition, because the document will be published on Regulations.gov, each page should be formatted to be viewed online.

Historical Traffic In o rder to assist carriers in making traffic and revenue projections, we have include d historical traffic for the communities in Appendi x B for the most recent annual periods. For the most recent 12

- month period for which data are available, Devils Lake had 9.1 enplanements per day, and Jamestown had 8.0.
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 to support EAS 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 activi ties. Because the Department is prohibited from paying subsidy to carriers that do not submit these documents, the selected carrier will be required to submit them in o rder to receive subsidy. Interested carriers requiring more detailed information regar ding these requirements, as well as copies of the certifications, should contact the Office of Aviation Analysis at (202) 366

- 5903

.
Communit y Comments Civic officials and the State are welcome to submit comments on the proposals at any time. As noted e arlier, we will provide a summary of the proposals to the civic parties and ask them to submit their final comments shortly after November 26
, 2013, the due date for carrier proposals.

This Order is issued under authority delegated in 49 CFR Part 1. 25a(b) and re

- delegated to the Directo r, Office of Aviation Analysis.
ACCORDINGLY,

1

. The Department requests proposals from carriers interested in providing EAS at Devils Lake and/or Jamestown
, North Dakota . Carriers should submit proposals, with subsidy if necessary, by November 26 , 2013 . Proposals should be emailed to EAS@dot.gov, with the title “Proposal to Provide EAS at Devils Lake and/or Jamestown
, North Dakota ” 5 ;

2

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

4 The certifications are available on the web at http://www.dot.gov/policy/aviation

- policy/small

- communit y

- rural

- air

- service/essential

- air

- service 5 Questions regarding filings may be directed to Kevin Adams at 202

- 366

- 1047 or Kevin.Adams@dot.gov- 4

-

3 . We will serve this Order on the mayors of Devils Lake and Jamestown, the airport managers at Devils Lake Regional Airport and Jamestown Regional Airport, and the

s ervice l ist for th is Docket.
Persons entitled to petition the Department for review of this Order un der the Department’s Regulations, 14 CFR Part 385. 31 , 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 effect iveness.
By:

TODD M. HOMAN Director Office of Aviation Analysis (SEAL)

An electronic version of this document is available at http://www.regulations.govAppendix A

Nonstop Great Circle Miles to Minneapolis/St. Paul (MSP) BIS, Bismarck 386 DVL, Devils Lake 351 FAR, Fargo 223 GFK, Gran d Forks 284 JMS, Jamestown 299 TVF, Thief River Falls 261
Nearby Service DVL to JMS 83 DVL

- GFK 81 JMS

- FAR 88Appendix B-1

Historical Traffic at Devils Lake, ND (DVL), Scheduled Passenger Service

Enplaned Pax. Deplaned Pax. O&D Pax 2008 3 Mesaba 970 939 1,909 2008 4 Mesaba 743 719 1,462 2009 1 Mesaba 881 839 1,720 2009 2 Mesaba 912 930 1,842 YE 6-30-09 3,506 3,427 6,933

2009 3 Mesaba 953 795 1,748 2009 4 Mesaba 988 703 1,691 2010 1 Mesaba 984 907 1,891 2010 2 Mesaba 1,217 1,163 2,380 YE 6-30-10 4,142 3,568 7,710

2010 3 Mesaba 1,419 1,369 2,788 2010 4 Mesaba 1,372 1,300 2,672 2011 1 Mesaba 1,371 1,368 2,739 2011 2 Mesaba 1,336 1,376 2,712 YE 6-30-11 5,498 5,413 10,911

2011 3 Mesaba 1,554 1,521 3,075 2011 4 Pinnacle 19 34 53 2011 4 Great Lakes 231 189 420 2011 4 Mesaba 1,088 997 2,085 2012 1 Great Lakes 634 672 1,306 2012 2 Great Lakes 673 756 1,429 YE 6-30-12 4,199 4,169 8,368

2012 3 Great Lakes 889 820 1,709 2012 4 Great Lakes 780 728 1,508 2013 1 Great Lakes 596 633 1,229 2013 2 Great Lakes 607 642 1,249 YE 6-30-13 2,872 2,823 5,695

Source: T-100 Market ReportAppendix B-2

Historical Traffic at Jamestown, ND, (JMS) Scheduled Passenger Service

Enplaned Deplaned O&D Pax 2008 3 Mesaba 715 731 1,446 2008 4 Mesaba 918 910 1,828 2009 1 Mesaba 695 723 1,418 2009 2 Mesaba 699 765 1,464 YE 6-30-09 3,027 3,129 6,156

2009 3 Mesaba 819 928 1,747 2009 4 Mesaba 1,020 1,210 2,230 2010 1 Mesaba 858 1,077 1,935 2010 2 Mesaba 966 1,018 1,984 YE 6-30-10 3,663 4,233 7,896

2010 3 Mesaba 1,244 1,299 2,543 2010 4 Mesaba 1,250 1,269 2,519 2011 1 Mesaba 1,234 1,294 2,528 2011 2 Mesaba 1,124 1,239 2,363 YE 6-30-11 4,852 5,101 9,953

2011 3 Mesaba 1,210 1,282 2,492 2011 4 Endeavor 225 203 428 2011 4 Mesaba 1,385 1,286 2,671 2012 1 Pinnacle 1,549 1,545 3,094 2012 1 Great Lakes 126 199 325 2012 2 Great Lakes 500 647 1,147 YE 6-30-12 4,995 5,162 10,157

2012 3 Great Lakes 595 655 1,250 2012 4 Great Lakes 750 719 1,469 2013 1 Great Lakes 585 635 1,220 2013 2 Great Lakes 522 548 1,070 YE 6-30-13 2,452 2,557 5,009

Source: T-100 Market ReportApp endix C
Example of General Terms and Conditions for Essential Air Service
The carrier understands that it may forfe it 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 appro val. 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 cancella tions, 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 ens ured 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 lac k 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 nationa l 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 cessati on. 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 th is 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 fo regoing paragraph.
All claims for payment, including any amended claims, must be submitted within 80 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 31 st ; August claims must be submitted by November 30 th , and so on.