Order: 2012-4-9

 Served: April 6, 2012

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 6th of April, 2012

Essential Air Service at

WEST YELLOWSTONE, MONTANA

under 49 U.S.C. 41731 et seq.

Docket DOT-OST-2003-14626

ORDER SELECTING CARRIER

Summary

By this Order, the Department is selecting SkyWest Airlines (“SkyWest”) to continue to provide 

Essential Air Service (EAS) at West Yellowstone, Montana, at an annual subsidy rate of

$389,412, for the next summer season from June 1 through September 30, 2012.1

Background

By Order 2010-3-30, March 25, 2010, the Department selected SkyWest Airlines, Inc. d/b/a 

Delta Connection (SkyWest) to provide subsidized EAS at West Yellowstone for the 2010 and 

2011 summer seasons at a subsidy rate of $427,757 for each four-month season. Under that 

Order, SkyWest provided 14 nonstop round trips per week to Salt Lake City International 

Airport (Salt Lake City) as Delta Connection, with 30-seat Embraer Brasilia aircraft. 

In anticipation of the end of the rate term, the Department issued Order 2011-12-3, December 12, 

2011, soliciting proposals to provide efficient EAS, with subsidy support if necessary, at West 

Yellowstone, for the next two summer seasons. 

Proposals

In response to that order, we received proposals from two carriers, SkyWest, the incumbent, and 

Silver Airways.

SkyWest proposes to continue its historical level of subsidized service 14 nonstop round trips per 

week to Salt Lake City as Delta Connection for the 2012 summer, from June 1, 2012, through 

 

1 Such subsidy is calculated and distributed on a fiscal year basis, subject to the availability of appropriated funds.
September 30, 2012, utilizing 30-passenger Embraer Brasilia aircraft for a subsidy of $389,412.

SkyWest’s proposal is for the summer 2012 season only, which was done in anticipation of West 

Yellowstone’s completion of the regulatory approval process to receive scheduled, commercial 

jet service, prior to the 2013 season.

Silver Airways proposes one option with 19 nonstop round trips per week to Billings, Montana, 

using 19-seat Beech 1900D turboprops for a subsidy of $704,236 for each four-month season.

The complete proposals of both carriers may be accessed online at http://www.regulations.gov/ 

by entering “DOT-OST-2003-14626.”

Community and State Comments

On February 24, 2012, we requested community comments regarding the carrier selection at 

West Yellowstone. 

In a March 6 letter to the Department, Mayor Jerry Johnson, Town of West Yellowstone (“the 

Town”) stated that the Town “supports the proposal submitted by SkyWest.” He also says the 

Town “has enjoyed a relationship with SkyWest Airlines since 1987 and appreciates the 

dependable and important service the airline has provided to West Yellowstone and the 

surrounding area.” The letter also mentions that “SkyWest is well-established in the market.” 

The Department also received a March 8 letter from Tim Reardon, Montana Department of 

Transportation (“MDT”), stating it is “encouraged to see competition in this market.” It 

commends Silver Airways for its proposal, but states, “Sky West Airlines has provided [the] 

region for many years with excellent service, qualified staff and supportive local interaction.” 

and MDT states that it supports SkyWest’s service option for the 2012 summer season.

Decision

SkyWest has served West Yellowstone for many years and continues to provide them with 

reliable essential air service. The community fully supports SkyWest and we find that its 

subsidy request is reasonable. Therefore, we will reselect SkyWest operating with 30-seat 

Embraer Brasilia aircraft, to provide service from West Yellowstone to Salt Lake City, for the 

2012 summer season, at an annual subsidy rate of $389,412. 

We shall make SkyWest’s selection at West Yellowstone contingent upon the Department’s 

receiving properly executed certifications from SkyWest that it is in compliance with the 

Department’s regulations regarding drug-free workplaces and nondiscrimination, as well as the 

regulations governing lobbying activities.

Carrier Fitness

49 U.S.C. 41737(b) and 41738 require that we find an air carrier fit, willing, and able to provide 

reliable service before we may subsidize it to provide essential air service. SkyWest is subject to 

the Department’s continuing fitness requirements, and no information has come to our attention 

that would cause us to question the carrier's fitness at this time. We have contacted the Federal 

Aviation Administration, and it has raised no concerns that would negatively affect our fitness 
finding. We therefore conclude that the carrier remains fit to conduct the operations proposed 

here.

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

ACCORDINGLY,

1. We select SkyWest Airlines to provide essential air service at West Yellowstone, Montana;

2. We set the final rate of compensation for SkyWest Airlines for the provision of essential air 

service at West Yellowstone, Montana, as described in Appendix C;

3. We direct SkyWest Airlines to retain all books, records, and other source and summary 

documentation to support claims for payment, and to preserve and maintain such documentation 

in a manner that readily permits its audit and examination by representatives of the Department. 

Such documentation shall be retained for seven years from the service date of this order or until 

the Department indicates that the records may be destroyed, whichever comes first. Copies of 

flight logs for aircraft sold or disposed of must be retained. The carrier may forfeit its 

compensation for any claim that is not supported under the terms of this Order;

4. We find that SkyWest Airlines continues to be fit, willing and able to operate as a certificated

carrier and capable of providing reliable essential air service at West Yellowstone, Montana; 

5. This docket will remain open until further order of the Department; and

6. We will serve copies of this order on the Mayor and Operations Manager of the Town of 

West Yellowstone, the Montana Department of Transportation, Aeronautics Division, SkyWest

Airlines, and Silver Airways.

By:

SUSAN L. KURLAND

Assistant Secretary

for Aviation and International Affairs

(SEAL)

An electronic version of this document is available on the Internet at

http://www.regulations.gov
Appendix A

AREA MAP
Appendix B
Appendix C

SkyWest Airlines

Essential Air Service to be Provided at West Yellowstone, Montana

Effective Period: June 1 through September 30, 2012

Scheduled Service: 14 nonstop round trips to Salt Lake City International Airport each week

Aircraft: Embraer Brasilia (EMB 120), 30 seats

Rate per Eligible Flight: $8151

Weekly Ceiling: $22,8202

Note: 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 completely, 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.

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.

Funds are not currently available for performance under this order beyond September 30, 2012. The Government’s 

obligation for performance under this order beyond September 30, 2012, is subject to the availability of appropriated 

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 September 30, 2012, until funds are made available to 

the Department for performance. If funds are not made available for performance beyond September 30, 2012, the 

Department will provide notice in writing to the carrier.

All claims for payment must be submitted within 60 days of the last day of service provided under this order.

 1 Annual compensation of $389,412 divided by 478 annual departures (122 service days x 4 flights per day x 98 

percent completion).

2 28 flights per week multiplied by $815 per flight.