## Before the United States Department of Transportation 

# Washington, DC

October 15, 2014

Essential Air Service at: PIERRE, SOUTH DAKOTA Docket OST-2011-0138 under 49 U.S.C. 41731 et.seq.
This document contains Great Lakes Aviation, Ltd.'s response to Order Requesting Proposals 2014-9-10. Great Lakes has been continuously providing Pierre scheduled air service since October of 1991. Today the company provides three round trips of non-stop service to Denver daily. The servic e is provided utilizing Embraer 30 passenger EMB-120's twice daily and a Beech 1900-D, wit h nine passenger seats installed, scheduled once daily non-stop to Denver for a total of 69 seats daily. Our proposal contained herein, provides the requested increase in available seats b y replacing the non-stop nine seat Beech 1900-D with 30 passenger EMB-120. Great Lakes is also providing Pierre with twice daily one-stop service to Minneapolis/St. Paul utilizing nine seat configured Beech 1900-D. The removal of 10 seats from the Beech 1900-D's was a direct result of relatively new Congressionaly mandated changes to pilot hiring requirement s for FAR part 121 scheduled operations. Despite frequent efforts by the airline industry to inform Congress of the small community air service crisis that is now becoming a reality, versus speculation, therehas been no industry relief granted to date.

A s an alternative to the subsidization of the 30 Seat aircraft, the company would be prepared to eliminate the subsidy requirement when the 10 seats can be reinstalled in our Beech 1900-D fleet. The reinstallation of the seats would provide an additional 30 seats available per day to the current schedule at no cost to the Taxpayer. New FAA pilot qualification rules have created an industry-wide pilot shortage which has had an acute impact on Great Lakes. These new rules mandated that first officers obtain an Airline Transport Pilot certification (“ATP”) prior to being qualified to perform crewmember duties in scheduled airline passenger service under FAR Part 121 regulatory requirements. A key factor to enable a pilot to receive an ATP certificate is the accumulation of 1,500 flight hours. On March 18th of this year, Great Lakes received from the FAA new operations specifications allowing us to hire pilots under it's FAR Part 121 Certificate utilizing FAR Part 135 regulatory hiring requirements. This allows our new hire pilots to operate the Beech 1900-D aircraft in a nine seat configuration and will enable Great Lakes to restore pilot staffing levels while maintaining FAR Part 121 hiring, training and maintenance standards.Questions and comments may be referred to:

Michael O. Matthews Chief Financial Officer Great Lakes Aviation, Ltd. 1022 Airport Parkway Cheyenne, WY 82001 (307) 432-7000 Our proposal contemplates conveniently timed connecting services to our Denver hub, whereby passengers may utilize our code-share agreement with United Airlines. Local service will be marketed and priced utilizing the Great Lakes (ZK) brand and reservations system. Additionally, Great Lakes maintains interline ticketing and baggage agreements with the majority of the other carriers serving Denver, including interline e-ticketing agreements with American Airlines, Delta Airlines (with the ability to earn Delta Skymiles) and United Airlines. All of which will offer passengers traveling to and from these communities supplemental access to the domestic and international air transportation system. It is Great Lakes' belief that regulatory relief for small community air service must be granted in the near future. Excessive subsidy requirements will force communities to loose EAS service eligibility as available seats are being dramatically reduced due to arbitrary limitations on aircraft seating configurations. Great Lakes’ stands ready to participate in creative solutions to assist small communities in their efforts to remain in the National Air Transportation System.

# Great Lakes Aviation, Ltd. Annual Compensation Requirements for Essential Air Service at 

## Pierre, South Dakota to Denver (DEN) One Round Trips - EMB-120

(at 98 percent completion)

Departures: 512 Block Hours: 759 Revenue Passenger Miles: 3,850,000 Available Seat Miles: 5,913,600
Operating Revenues: Passenger: PIR-DEN 10,000 psgrs at $122.74 $1,227,400

Other: (at 0.62% of passenger revenue) $7,610 Total Operating Revenues: $1,235,010
Operating Expenses: Direct: Aircraft and Hull Insurance $112,653 Fuel and Oil $549,420 Flying Operations $180,088 Maintenance $269,870 Total Direct Expenses: $1,112,031 Total Indirect Expenses: $795,165 Total Operating Expenses: $1,907,196 Operating Loss ($672,186) Profit Element (5.0% of Total Operating Expenses) $95,360 Annual Compensation Requirement: $767,546
All Pierre - Denver - Pierre Service is Non-Sto p This Proposal is submitted with no upline scheduling restrctions.