Order 2010

- 12

- 10

Served: December 6 , 2010



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 6 t h day of December , 20 10

ORDER REQUESTING PROPOSALS

Summary By this order, the Department is requesting proposals f r om carriers interested in providing essential air service ( EAS ) at Carlsbad, New Mexico, for the next two

- year period, beginning June 1, 20 11 , with or without subsidy. (See Appendix A for a service area

map )

. Carriers should file their proposals no later than January 6

, 2011

.

Background By Order 200 9

- 4

- 18

, A pril 27 , 200 9 , the Department re

- selected Pacific Wings L.L.C.,

d/b/a New Mexi co Airlines to provide subsidized EAS at Carlsbad for the two

- year period beginn ing June 1, 2009 , for a n annual subsidy rate of $ 1,046,284

. Under that

order

, New Mexico Airlines provide s two round trips between Carlsbad and Albuquerque each weekday and ea ch weekend, utilizing single

- engine, 9

- passenger Cessna Grand Caravan (C

- 208B) turboprop aircraft.

Request for Proposals

As the end of the current contract approaches, we are here requesting proposals from carriers interested in providing service at Carls bad

, with or without subsidy, for the two

year period beginning June 1, 2011. Carriers should file their proposals no later than January 6

, 2011

. Staff will then docket proposals, thereby making them public, and shortly afterwards will provide a summary of the proposals to the communit y and ask them for their final comments. We will give full consideration to all proposals filed in a timely manner. 1

1 Carriers should not expect the Department to accept late fillings. 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 p roceed with the carrier

- selection case. Instead, we simply rely on that

carrier’s su bsidy

- free service as proposed. Essential Air Service at

CARLSBAD, NEW MEXICO

Under 49 U.S.C. 41731 et seq

. Docket DOT

- OST

- 2002

- 12802- 2

-

Interested carriers should prepare their proposals with every expectation that their initial proposals wil l represent their final and only proposals. However, 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 re

- solicit a new round of proposals. However, negotiation or rejection are only an occasional exception 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. 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; howeve r, 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 t he affected communit y and the Department. 2

The Department expects proposals that are co nsistent with what the community currently receives (12 weekly round trips with nine

- seat aircraft)

. We note that EAS at Carlsbad

calls for service with 15

- seat aircra ft. However, during the last two

- year contract, the community approved the service with nine

- seat aircraft. Given the traffic levels described below, two round trips a day with nine

- seat aircraft will provide ample capacity

to accommodate traffic. We en courage 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 those requirements if they envision other, potentially more attract ive service possibilities

-- different hubs, for example

-- with subsidy requirements that remain competitive.

The community and air carriers are encouraged to work together in advance of the due date for proposals to craft service patterns that are desir able to the community and meet the operational requirements of the airline.

Service and Traffic History

H istorical traffic is detailed in Appendix B. During the year ended December 31, 200 9

, Carlsbad averaged 9.8 enplanements a day (which includes servic e to Alamogordo

, Hobbs and El Paso) , an increase over the previous calendar year.

2 In selecting a carrier to provide subsidized essential air service, 49 U.S.C. 41733(c)(1) directs us to consider four factors: (a) schedu led service reliability; (b) contractual and marketing arrangements with a larger carrier to ensure service beyond the hub; (c) interline arrangements that the applicant has made with a larger carrier at the hub; and (d) community views, giving substantial weight to the views of the elected officials representing the users. In addition, the Consolidated Appropriations Act, 2008, Public Law 110

- 161 , provides that

, when selecting a carrier to provide EAS, the Department may consider the relative subsidy requ irements, thus codifying a factor that we have considered since the inception of the program

.- 3

-

New Filing Procedures Carrier proposals should be submitted to the Department with all materials merged into a single document. In addition, because th e document will be p ublished on Regulations.gov, each page should be formatted to be viewed online.

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

- free workplaces, and nondiscrimination. 3 Consequently, all carriers receiving Federal subsidy for essential air service must certify that they are in compliance with Department regulations regarding drug

- free workplaces and nondiscrimination, and those carriers whose subsidies exceed $100,000 o ver the life of

the rate

- term 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 Av iation Analysis at (202) 366

- 5903. 4

Community and State Comments The community and State are welcome to submit comments at any time. We encourage prospective applicants to contact the communit y before they submit their proposals so that they can tailor t hem to the communit y ’ 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 and ask them to submit their final comments shortly after January 6 , the

deadline fo r carrier proposals.

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

ACCORDINGLY, 1. We request that carriers interested in providing essential air service at Carlsbad, New

Mexico , submit their proposals, with or without subsidy reque sts, no later than January 6

, 2011

. The proposals should be e

- mailed to: EAS@dot.gov with the title “Proposal to Provide Essential Air Service at Carlsbad, New Mexico

, Docket DOT

- OST

2002

- 12802 ”; 5

2. This docket will re main open until further order of the Department; and

3 The regulations applicable to these areas are: (1) 49 CFR Part 20

-- New restrictions on lobbying; (2) 49 CFR Part 21

-- Nondiscrimination in federally

- assiste d programs of the Department of Transportation

-- Effectuation of title VI of the Civil Rights Act of 1964; 49 CFR Part 27

-- Nondiscrimination on the basis of disability in programs and activities receiving or benefiting from Federal financial assistance; and 14 CFR Part 382

-- Nondiscrimination on the basis of disability in air travel; and (3) 49 CFR Part 29

-- Government

- wide debarment and suspension (non

- procurement) and government

wide requirements for drug

- free workplace (grants).

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

5 Questions regarding filings in response to this order may be directed to Brian Swanson at (202) 366

- 5392

or brian.swanson@dot.gov

.- 4

-

3. We will serve copies of this order on the parties listed in Appendix D.

Persons entitled to petition the Department for review of this order under the Department’s Aviation Economic 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. HOMAN

Director

Offic e of Aviation Analysis

(SEAL)

An electronic version of this document is available

on the World Wide Web at http://www.regulations.govAppendix A



### AREA MAPAppendix B

No tes : 1. Source : Order 200 9

- 2

- 1 , Docket OST

- 2002

- 1280 2 and US DOT Bureau of Transportation Statistics, Form T

- 100.

2. Origin

- destination passengers divided by two.

3. Average annual enplanements divided by 313 effective annual service days, except for annual periods ended 12/31/2000

, 12/31/2004 , and 12/31/2008 (314 effective annual service days). 

### Year Ended Origin &

Destination Passengers Annual

Enplanements 2 

### Average Enplanements
Per Service Day 3



### 31-Dec-99 15,734 7,867 25.1
31-Dec-00 14,182 7,091 22.6
31-Dec-01 12,598 6,299 20.1

31-Dec-02 5,792 2,896 9.3

31-Dec-03 5,571 2,786 8.9

31-Dec-04 7,110 3,555 11.3

31-Dec-05 8,497 4,249 13.6

31-Dec-06 7,102 3,551 11.3

31-Dec-07 5,050 2,525 8.1

31-Dec-08 3,655 1,828 5.8

31-Dec-09 6,141 3,071 9.8

1/1/2010 - 5/31/2010 2,063 1,032 

### Historical Enplanements 1



### Carlsbad, New MexicoAppendix 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 comp leted 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 o r 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 peri od 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 carrie r 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 adju sted 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 complet ely, 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 Depa rtment and carrier do not constitute a total or partial reduction or cessation 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, an y such statutes, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds are not currently available for performance under this solicitation beyond [DATE]

. The Department’s obligation for perform ance under this s olicitation beyond [DATE] is contingent upon the availability of appropriated funds from which payment for services can be made. No legal liability on the part of the Department for any payment may arise for performance under this order beyond [DATE] , unt il funds are made available to the Department for performance. If funds are 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 las t day of se rvice provided

under this order.Appendix D

SERVICE LIST

Air Sunshine, Inc. Jet Air, Daniel Wolford

Air Sunshine, Mirmohammad Adili Kenmore Air, Tim Brooks

Air West, Inc., John Raatz McCall Aviation and Salmon Air, Dan Scott

Air Wisconsin, Barbara Jones McCall Aviation, Michelle

Airline Associates, Bill Mishk Mesaba, Max Shemesh

Alaska Airlines, Jeff Cole Mesaba, John Spanjers

Alaska Airlines, Sandy Sinick Midstar Airlines, Jeffrey Fonner

Allegiant Air, Robert Ashscroft Midwest Airlines, Greg Aretaki s

American Airlines, Carl Nelson MN Aviation, Jose Maldonado

American Eagle, Jeff Hartz Multi Aero, Darnea

Atlantic Southeast, Jon Lindlief Multi Aero, Shane Storz

Atlantic Southeast, Roger Weston Northwest, Tim McDonald

Bemidji Aviation, Arlen Rinken berger NYDC, Henok Araya

Bemidji Aviation, Cori Rude OST, Brian Swanson

Cape Air, Andrew Bonney OST, Dennis DeVany

Cape Air, Dan Wolf OST, Kevin Adams

Cape Air, J. Flaherty OST, Kevin Schlemmer

Classic Aviation, Tony Henderson OST, Michael Martin

Col gan Air, Mike Colgan OST, Renee Williams

CommutAir, Andy Price Pacific Wings, Frank Ford

CommutAir, Joel Raymond Pacific Wings, Greg Kahlstorf

Consultant, Robert Silverberg Penn Air, Danny Seybert

Continental, Bruce Keiner Penn Air, Scott Bloomquist

C ontinental, Dan Weiss Pinnacle Airlines, Joe Williams

Continental, Lorry Halloway Pinnacle Airlines, Phil Reed

Delta Air Lines Amy Martin Public Charters, Jim Gallagher

Delta Air Lines, Jeff Morgan Scenic, Mary Schneider

Delta Air Lines, Dan Shuman Sce nic, Mitzi Daines

Delta Air Lines, Joe Esposito Seaborne Airlines, Wayne D’Amico

Delta Air Lines, Sascha Vanderbellen SeaPort Airlines. Jim Day

Delta Air Lines, Karen Zachary SeaPort Airlines. Rob McKinney

Dorado Jets Shuttle America, Jerry Balsano

Do rado Jets, Mark McKenna SkyWest, Eric Christensen

Era Aviation, Mike Lenorman SkyWest, Michael Thompson

Executive Airlines, Kate Soled Sovereign Air, Bob Karns

Frontier Flying, Bob Hajducovich Sovereign Air, Lois R. Barton

Gem Air, Dan Schroeder Tradew ind, Eric Zipkin

Gem Air, JoAnn Wolters Trans States, Fred Oxley

Great Lakes Airlines, Chuck Howell Trans States, Gerry Wigmore

Great Lakes Airlines, Doug Voss United, Alicia Gabriel

Gulfstream, Dave Hackett United, James Starnes

Gulfstream, Mickey Bo wman US Airways, Benjamin Slocum

Gulfstream, T. Cooper US Airways, Howard Kass

Homeland Security, Bill Ragan US Airways, Jason Reisinger

Homeland Security, David Bernier Warbelows Air Ventures, Art Warbelow

Homeland Security, Randy Webb Wings Air (Air Greco), Aaron Goerlich

Horizon Air, Dan Russo State of New Mexico

, David C.Ploeger

Horizon Air, Jennifer Thompson City of Carlsbad, Dale Janway

Horizon Air, Jeff Cole

ICEPR, Luis Irizarry

Intrepid Internatl Air, Rick Eyk

Island Air Charters, Linda House