### Legal sponsor: City of Klamath Falls, OR
DUNS: 01-074-3300

Tax ID: 93-6002195

Congressional
District: OR 02

Contact: John Longley City of Klamath Falls, OR Airport Director
6775 Arnold Avenue Klamath Falls, OR 97603 Phone: (541) 883-5372 Email: jlongley@flykfalls.com

Docket #: DOT-OST-2011-0119

Date: August 2, 2011 

# Proposal Under
the Small Community Air
Service Development Program

## Table of Contents
Page

1. Summary ........................................................................................................ 1

2. Proposal High lights....................................................................................... 2

3. Air Service Ba ckground ................................................................................ 5
A. Klamath Falls Catchment Area ........................................................... 5
B. Community Economics a nd Demographics ..................................... 6
C. Proximity to a Comp eting Airport ...................................................... 7
D. Factors Affecting Air Service ............................................................. 8
E. Klamath Falls Airport Cu rrent Air Se rvice ........................................ 8
F. Klamath Falls Airport Hist orical Air Service ..................................... 9
G. Past Air Service Deve lopment Efforts ............................................. 10

4. Air Service Needs a nd Deficiencies .......................................................... 12
A. Passenger Dive rsion ......................................................................... 12
B. High Airfar es ...................................................................................... 12
C. Underserved Market .......................................................................... 13

5. Strategic Plan ............................................................................................... 14
A. Public-Private Partners hip ................................................................ 14
B. Project Goals ...................................................................................... 15
C. Proposed Air Service ........................................................................ 16
D. How This Project Differs from the SFO Service Project ................ 16
E. Airline Partic ipation ........................................................................... 17
F. Analysis and Forecasts .................................................................... 17
G. Action Plan ......................................................................................... 19
H. Alternate Plan ..................................................................................... 20
I. Funding and In-Kind C ontributions ................................................. 20

6. Schedule and M onitoring ........................................................................... 22
A. Action Plan Schedule ........................................................................ 22
B. Milestones .......................................................................................... 22
C. Monitoring Pr ogram .......................................................................... 23
D. Project Continuation an d Sustainability ......................................... 23

Attachment A. Airlin e & Community support ................................................ 24Section 1 Summary

Page 1 

## 1. Summary

The Klamath Falls community served by the Klamath Fa lls Airport in southern Oregon is underserved to top destination markets and is overpriced compared to similar communities. Since Horizon Air pulled out of the market in 2008 and SkyWest Airlines (the incu mbent carrier) reduced serv ice to one flight per day to Portland, the number of available seat s to Portland has been reduced by 46%.

The lack of timely air service coverage and connecti vity has increased travel costs for business and leisure travelers and is impeding the economic recovery of the area. To address this problem, the City of Klamath Falls, the airport sponsor, is requesting $250,000 in federal assistance to facilitate the implementation of a $314,500 air service improvement in itiative that would add an early morning flight between Klamath Falls and Portland. The project goal is to improve air service to a broad section of Klamath Falls’ traveling community, mitigate the ne ed to drive long distances to access acceptable and timely air service, and provide better local ac cess to the air transportation system.

Assistance will provide material benefit to businesse s, educational institutions and healthcare providers whose access to clients, suppliers, customers and fa cilities is limited by the infrequency and timing of the one currently available flight betw een Portland and Klamath Falls.

Community partner commitment is strong and is in th e form of cost sharing through both cash and in-kind contributions and anticipated ticket pur chases. SkyWest Airlines also s upports the project and the grant application. Community partners have committed to ov er 2,200 roundtrips per year should this service
become available.

Non-airport sources will fund 8 percent ($22,000) of the $274,500 cash requirement of the proposed plan. The airport and the community will provide 20 percent ($64,500) of the total funding plan in the form of cash and in-kind services. Of the $64,500 local cont ribution, $24,500 is cash with the remaining $40,000
in in-kind services.Section 2 Proposal Highlights

Page 2 

## 2. Proposal Highlights
This Small Community Air Service Development Progr am (“SCASDP”) grant application for the City of Klamath Falls representing the Klamath Falls Airport m eets the criteria set out in Docket DOT-OST-2011- 0119. The City of Klamath Falls, the airport sponso r, is requesting $250,000 in federal assistance to facilitate the implementation of a $314,500 air service im provement initiative that benefits a rural region of southern Oregon and northern Oregon. The project goal is to improve air service to a broad section of Klamath Falls’ traveling community, mitigate the ne ed to drive long distances to access acceptable and timely air service, and provide better local access to the air transportation system. The plan to accomplish this goal is to improve time of day co verage and connectivity by adding an early morning flight to SkyWest Airlines’ (the incumbent carrier) existi ng schedule from Klamath Falls Airport to Portland International Airport with the Embraer 120 aircraft.

Air Service Issues The Klamath Falls community served by the Klamath Falls Airport is underserved to top destination markets and is overpriced compared to similar communities. Air service has decreased as SkyWest ceased offering two flights to Portland in October 2010 and currently there is only one flight per day to Portland International Airport. This sole flight is sc heduled at a time of day that, for the majority of travelers, requires an overnight stay in Portland in or der to make connections to flights to other parts of the country and precludes business travelers from Klamath Falls from arriving in Portland in time to conduct any business on the day of a rrival. Travelers will often choose to fly out of to Medford to get to
Portland if it is their destination or they are making a connection, or drive to Portland. Given Oregon’s geography and climate, during the winter months, dr iving to Portland can take six to 10 hours in bad conditions, and be a safety hazard. The lack of conv enient access to and from Klamath Falls hinders commerce and impedes economic vitality in the community.

Strategic Plan The proposed plan includes resumption of an early mo rning round trip nonstop flight between Klamath Falls Airport and Portland International Airport op erated by SkyWest Airlines. From a community perspective, early morning service to Portland will pr ovide more options to the local air traveler, enable business travelers to conduct a day’s business withou t incurring lodging costs and reduce long drives for local air travelers to surrounding airports. The nonstop service will be supported by a two part plan: 1. Airline start-up support 2. Advertising and promotion

SkyWest Airlines firmly supports the proposed plan. It is anticipated that SkyWest Airlines will implement early morning nonstop service to Portland International Airport from Klamath Falls on April 1, 2012. The proposed plan will be completed by April 2013 with ongoi ng early morning nonstop service to Portland. It
is estimated that the additional service to Port land will serve 15,768 passengers per year.

Broad Community Support The following public and private entities formed a public -private partnership (the “a ir service partnership”) in support of this application:Section 2 Proposal Highlights

Page 3 • City of Klamath Falls

• JELD-WEN, inc.

• Klamath Falls Biomass

• JWTR

• Klamath Employment Trends

• Klamath Falls Herald and News

• Basin Mediactive

• Sky Lakes Medical Center

• Iberdrola Renewables

• Klamath Falls Chamber of Commerce

• Discover Klamath (local tourism agency)

• Wynne Broadcasting

Non-airport sources will fund 8 percent ($22,000) of the $274,500 cash requirement of the proposed plan. The airport and the community will provide 20 percent ($64,500) of the total funding plan in the form of cash and in-kind services. Of the $64,500 local cont ribution, $24,500 is cash with the remaining $40,000
in in-kind services.

Strong Ability to Implement Project The air service partnership listed above, and other local businesses in the Klamath Falls area fully support this plan and have the ability to implement th is project as proposed. Key members of the air service partnership have been partic ularly active since Horizon Air left the market and have developed a good working relationship with the management of SkyWest, the current carrier. The air service partnership has met regularly with SkyWest managem ent and the relevant local transportation authorities over the past few years to discuss proposed changes in air service or make recommendations. Staffing and funding for the proposed plan has been committed by all private and public partners. In addition, management at SkyWest Airlines supports the pro posed plan. The Klamath Falls community has a strong desire and a population base to support the air se rvice initiative. In short, all of the pieces are in place to implement the proposed plan.

Multiple Sectors of the Community Will Benefit from the Proposed Plan Improved commercial air service at Klamath Falls Ai rport will benefit a broad section of the traveling public including businesses, educational institutions , healthcare providers and leisure travelers. The airport serves a local population in excess of 78,000, not including the growing number of inbound leisure
travelers. The Klamath Falls area includes a vibr ant business community, educational institutions such as the Oregon Institute of Technology and the Klamat h Community College, and healthcare facilities such as Sky Lakes Medical Center and the proposed Sanford Pediatric Clinic, a regional healthcare provider (construction expected to start by year end 2011). Klamath Falls and the surrounding area has many
scenic attractions that attract thousands of visitors each year including Crater Lake National Park, Klamath Lake Migratory Bird Flyway, Lava Beds Na tional Monument and the Running Y Ranch Resort. Many of these inbound leisure travelers will benefit fr om the air service improvements contemplated in theSection 2 Proposal Highlights

Page 4 proposed plan. Clearly, the proposed air service will meet the goals of the Small Community Air Service Development Program to benefit air travelers.Section 3 Air Service Background

Page 5 

## 3. Air Service Background

To identify community air service needs, it is importa nt to understand the characteristics of the community and know the past and present air service situation. This Air Service Background section provides a community overview including the airport catc hment area and economic and demographic data. Extenuating factors that a ffected air service in the past (e.g. proximity to a competing airport) are discussed as well as a description of air service developm ent efforts over the past five years. Information on existing air service, including ai r carriers, service frequency, dire ct and connecting destinations, and equipment types, and a synopsis of hist orical service, including destinat ions, traffic levels, and service providers, is also covered in this section.



### A. Klamath Falls Catchment Area
Klamath Falls Airport serves a large geographic ar ea with a growing population. The Klamath Falls Airport catchment area encompasses Klamath and Lake Counties in Oregon and portions of Modoc and Siskiyou counties in California. The airport not onl y serves the city of Klamath Falls, Oregon but also multiple cities in Northern Calif ornia and rural areas in both stat es. Overall, an estimated 78,368 1 people reside in the Klamath Falls Airport catchment area.

Exhibit 3.1 Airport Catchment Area

Source: Microsoft MapPoint 2004

1 This number and much of the data presented in this application is from a Market Analysis performed in 2007 for the Northwest Regional Air Service Initiative. The leak age data contained herein is the most current.Section 3 Air Service Background

Page 6 

### B. Community Economi cs and Demographics
The proposed air service improvement to Portland from Klamath Falls Airport will extend benefits to all sectors of the Klamath Falls community, includi ng government, business, education, healthcare and tourism. The region is becoming more economically diverse with many businesses and institutions reliant on air service for connections to customers, suppliers , consultants and facilities located in other parts of the state or the country. Improving time of day coverage and connections to and beyond Portland is the top priority of the community.

Klamath Falls is located in south-central Oregon ap proximately 15 miles north of the Oregon/California
border. Klamath Falls is situated on the eastern slopes of the Cascade Mountains and the southern shore of Upper Klamath Lake. It serves as the gateway to the nearly unlimited outdoor recreation opportunities offered by a pristine landscape of mount ains, marshes, lakes, and the crown jewel of the Cascades, Crater Lake National Park. Historically , the region’s chief industries include manufacturing generally associated with the timber trade, wood pr oducts, and agriculture. Manufacturers and natural
resource related businesses in the area with intere st in additional service to Portland include JELD-WEN, inc. (corporate headquarters, rese arch and development, millwork and window and door manufacturing) and Klamath Falls Biomass (renewable energy).

Though resource gathering and manufacturing industries remain a vital part of the regional economy, the
area has a diversified economic base that includes a dynamic service industry. Over the last two decades, tourism has grown signific antly and is the leading industry of the region. This is largely attributed to the extraordinary natural setting and the prox imity of tourist attractions such as Crater Lake National Park, Lava Beds National Monument and the Running Y Ranch, a major destination resort just
outside of Klamath Falls.

In recent years, there has been an increase in bu siness relocations to the area from other states, particularly high-tech businesses from California. This trend is likely to continue given Klamath Falls’ close proximity to California and Nevada. The healthcare industry is also growing in the Klamath Falls area with the recent significant ex pansion of the Sky Lakes Medical Center which serves the healthcare needs of people in a 10,000 square mile area of Oregon and California, and the proposed Sanford Pediatric Clinic. However, for the business, service an d tourism sectors to continue to grow, improved air service is essential. The Strategic Plan proposed w ill improve time of day coverage and connectivity via Portland and will help meet the needs of this growing community.

Improved air service will also serve a broad spectrum of other types of organizations as well. In Klamath Falls, the Oregon Institute of Technology (OIT), Klamath Youth Development Center and Oregon Air National Guard are specific educational, non-profit and government entities that will use and benefit from
new air service if available.

While the local airport must serve the residents of its catchment area, it also has a high potential for serving travelers destined for Oregon from throughout the United States. Additional air service to Portland International Airport from Klamath Falls Airport will have far reaching benefits for a broadSection 3 Air Service Background

Page 7 spectrum of travelers and will accomplish the goals of the Small Community Air Service Development Program.



### C. Proximity to a Competing Airport
Klamath Falls is a relatively isolated community, having access to the Oregon state highway system but no interstate that passes through it. As a result, acceptable air service takes on more importance as a mode of transportation.

Fifty-three percent of Klamath Falls Airport catchment area air travelers drive to an alternate airport to access air service. Of the passengers not using the local airport, 26 percent use Medford’s Rogue Valley International Airport, 81 miles west, 9 percent drive 30 1 miles north to use Portland International Airport. 2

Travelers destined from Klamath Falls who use alternat e airports are likely to encounter high levels of road traffic in metropolitan areas, long pre-boarding time requirements of over 90 minutes, and unsafe driving conditions in winter that increase travel time and potentially lead to delays and missed flights. Choice of airport to use by the local population is influenced by a variety of factors including, but not limited to: nonstop destinations offered, flight frequen cy, and travel costs. The proposed additional flight to Portland International Airport would mitigate thes e factors, and encourage more use of air travel, particularly for business travelers. Consequently, an increa se in use could potentially result in lower fares by spreading airline costs among more passen gers and offering more discounted seats.

2 Source: Northwest Regional Air Servic e Initiative Market Analysis – 2007Section 3 Air Service Background

Page 8 Exhibit 3.2 Proximity to a Competing Airport

Source: Microsoft MapPoint 2004



### D. Factors Affecting Air Service
Klamath Falls’ catchment area is a mixed blessing. On one hand, the catchment area is isolated from larger competing airports; on the other hand, the ai rport catchment area contains a modest population of 78,368. The community’s isolated location in so uthern Oregon, removed from major population and commercial centers, has ready-made air travel demand. With no major airports nearby and limited highway access, the dependence on air travel is high. The current service that puts business travelers into Portland at a time of the day when business cannot be conducted or tr avel connections cannot be made without having to incur the additional cost of an overnight stay is driv ing passengers and airline revenues to competing airlines and competing airpor ts. Additional service, utilizing the same fleet of smaller aircraft, is necessary to m eet the market demand created by the dynamic growth in the business,
educational and healthcare sectors and cont inued development of the tourist market.



### E. Klamath Falls Airpor t Current Air Service
Currently, SkyWest Airli nes offers service to Portland Inte rnational Airport and to San Francisco International Airport from Klamath Falls. The service to Portland consists of one afternoon flight per day and is operated with Embraer 120 airc raft. Although this service provides essential access to the national air transportation system, connections eastbound out of Portland at the time this flight arrives are limited to overnight flights (“red eye” f lights). Most connections for east bound flights depart Portland in the morning and, in many cases, travelers making co nnections through Portland from Klamath Falls will needSection 3 Air Service Background

Page 9 to stay overnight in Portland in order to make thei r connection, significantly increasing both travel time and cost. For those just travelling to Portland, the su rrounding area, or to Salem, the State Capitol, it is not possible to conduct a full or partial day’s busine ss without having to incur the additional cost of an overnight stay. Improved time of day coverage as pro posed in this Strategic Plan will eliminate many of the issues related to insufficient connectivity.

Air service to San Francisco International Airport cons ists of an early morning flight and an evening flight.

Table 3.1 Current Air Service
Airport Marketing Carrier Destination Aircraft Weekly Departures Weekly Seats

Klamath Falls SkyWest / United Airlines Portland, OR EMB-120 7 210 San Francisco, CA EMB-120 14 420

Source: apgDat, Inc July 2011 schedule



### F. Klamath Falls Airport Historical Air Service
From 1997 to 2008, Horizon Air was the exclusive prov ider of commercial air service into and out of Klamath Falls Airport. In October 2008, due to a decisi on by Horizon Air to eliminate its fleet of 37 seat deHavilland Dash 8 Q200 turboprop aircraft and operate only the larger 76 seat Bombardier Q-400, it ceased serving Klamath Falls noting that airport usa ge did not generate enough passengers in the market to fill the larger aircraft (the Strategic Plan herein pro poses the use of 30 seat ai rcraft). The elimination of
Horizon Air service has resulted in a 46 percent reduction in available seats 3

.

Table 3.2 Historical Air Service

Airport Nonstop Destination Marketing Carrier Calendar Yea r 2005 2006 2007 2008 2009 2010 2011

Klamath Falls Portland, OR Horizon Air / Alaska Air
SkyWest / United Airlines
San Francisco, CA SkyWest / United Airlines

Source: apgDat, Inc – week of July 18, 2011

In October 2008, SkyWest began providing service between Klamath Falls and Portland with two nonstop flights per day between the two cities. In July 2008, with financial assistance obtained by the City of Klamath Falls through a SCASDP grant, SkyWest began to offer additional non-stop service to and from
San Francisco. That service cont inues today and is self-sustaining. However, SkyWest ceased the morning service between Klamath Falls and Portland in October 2010 due to low passenger enplanements likely driven by a less than optimal sch edule that departed Klamath Falls at 5:30 AM and 8 PM. The Strategic Plan proposes to improve overa ll ridership by improving time of day coverage and

3 Source: apgDat, Inc. comparison of July 2011 and July 2008 schedulesSection 3 Air Service Background

Page 10 connectivity by restoring the lost service at a more opt imal time to eliminate the need to drive to alternate airports.

Over the 10-year period from 1996 to 2005, enpla nements at Klamath Falls Airport increased by a compounded annual growth rate of 2.8 percent. From 1999 to 2004, enplanements remained near 30,000 with little growth. A modest growth in enplan ements occurred from 2004 to 2005. Since the loss of Horizon Air service in 2008, enplanements have declined with the loss of service.

With the market generating approximately 10,000 mo re annual enplanements in 2003 than in 2010, the region is more than capable of sustaining the pr oposed additional Portland frequency, but needs the Strategic Plan funding for the project to move forward. Adding a better timed Portland flight will tap into the unmet air service demand in the market, better serving the people and businesses of Klamath Falls.

Exhibit 3.3 Historical Enplanements

Source: apgDat, Inc 

### G. Past Air Service Development Efforts
For the past five years, management at Klamath Falls Airport has actively engaged in air service development. The airport studied its catchment area to quantify the level of demand for southbound air
service. Klamath Falls also conducted several studies of their market area, including a Passenger Demand Analysis, a Market Airfare Analysis, a Busine ss Travel Survey, and a pro forma analysis of San Francisco service. These efforts were key to secu ring the southbound service to San Francisco from Klamath Falls and to obtaining the SCASDP grant that facilitated the start up of that service.

Unfortunately, the air service development efforts we re not able to prevent the decrease in service northbound. As the business community begins to pull out of a long economic recession, it is finding thatSection 3 Air Service Background

Page 11 it does not have the air service levels it needs to maintain its growth momentum. Further, recovering businesses are financially disadvantaged by the re sultant added costs of doing business outside of the Klamath Falls area. The community needs financial assi stance in order to provide the needed incentive to
the incumbent carrier to restore service and offset th e airline’s risk. The proposed Action Plan would provide this needed financial assistance and serve as the bridge towards continued business recovery that would then result in self sustaining air service, eliminating the need for any subsidy.

Table 3.4 Past Air Service Development Efforts

Date Initiative Result March-05 UA SFO pro-forma Completed March-05 Northwest Regional Air Service Initiative SCASDP Application Successful

August-05 Business Travel Survey Completed April-07 SFO SCASDP App lication SuccessfulSection 4
Air Service Needs and Deficiencies

Page 12 

## 4. Air Service Needs and Deficiencies

This section provides an in depth description of t he community’s air service needs and deficiencies. Major origin/destination markets not now served or that are served inadequately are discussed. In addition to being underserved, this community is overpr iced. This section presents a detailed analysis to demonstrate that the average airfare in this commu nity is higher than other comparable communities.



### A. Passenger Diversion
The magnitude of Klamath Falls’ passenger dive rsion problem was identified in a 2007 passenger analysis. The study indicated that approximately 53 percent of the travel ers in the Klamath Falls Airport catchment area drive to other airports in search of better service and lower fares, particularly Medford’s Rogue Valley International Airport 81 miles distant an d Portland International Airport, 301 miles distant.

Klamath Falls’ lack of service options result in artifi cially high fares, which force large numbers of air travelers to drive long distances to obtain better service and relief from high fares. Consequently, the marketplace’s reaction has been to endure the inconvenience and expense of driving to another airport. However, inconvenience and expense are not the only consequences. Souther n Oregon’s geography and climate make travelling over mountain passes to t he Rogue Valley International Airport or to Portland International Airport in the winter a considerable safe ty issue. The extra time needed for these trips due to traffic (accident) and weather delays increases the likelihood of missed flights, further compounding the problem of added expense, inability to conduct busin ess and slowing the economic recovery of the region.



### B. High Airfares
Klamath Falls suffers from high airfares. Klamath Fa lls is losing over 63,000 annual passengers to other airports. In large part this loss of air travelers to competing airports is due to higher than average airfares at the local airport. Table 4.1 shows the average airfares paid by passengers traveling from Oregon’s commercial service airports to Portland International Airport.

Table 4.1 Average Airfares to Portland

Rank Oregon Airports Portland

1 Pendleton $99 2 Medford $83 3 Klamath Falls $81 4 Redmond $72 5 North Bend $71 6 Eugene $65 7 Newport $58 8 Astoria $45 Source: apgDat, Inc. – Calendar Year 2010

As indicated in Table 4.1, passengers at Klamath Fa lls pay the third highest average airfare to Portland compared to all other Oregon airports. Beyond the lo cal Portland market, Klamath Falls has a significant fare discrepancy with other surrounding airports, t he West region and the national average as shown inSection 4
Air Service Needs and Deficiencies

Page 13 Table 4.2. In 2010, Klamath Falls’ one-way average fare was $24 higher than Medford, $18 higher than Portland, $19 higher than Oregon, $25 higher than the West region and $22 higher than the US average.

Table 4.2 Average One-Way Fare Paid Airport Average Fare $ Klamath Falls Diff $ Klamath Falls $180 Medford $156 $24 Portland $162 $18 Oregon $161 $19 West Region $155 $25 US $158 $22 Source: Database Products, Inc CY 2010 Avg Fare



### C. Underserved Market
As stated above, despite the time savings afforded by using the local airport, approximately 53 percent of Klamath Falls Airport catchment area air travelers a ccess air service at an alternate airport. Current afternoon service to Portland fulfills a portion of Klamath Falls Airport’s needs, but does not provide sufficient time of day coverage and among the top 50 domestic destinations, Klamath Falls has excellent retention for destinations that are easy to connect to over Portland, particularly to the north. The addition of a morning Portland departure with improved connec tivity will improve retention and reduce the need to drive to alternate airports.

In terms of the extent this community is underserve d, Table 4.3 provides a comparison of communities with similar Metropolitan/Micropolitan Statistical Area populations in the Northwest region 4 . Klamath Falls Airport’s air service options in terms of weekly dep artures and weekly available seats are low compared to other communities. Compared to Walla Walla, Pullman and Port Angeles, WA, Klamath Falls has, by far, either the lowest number of weekly departures or weekly available seats for the size of their population. The proposed service enhancement would add more departures and seats making the market more competitive with other similarly sized communities in the region.

Table 4.3 Air Service Comparison

MSA/Micro/Airport Population Carriers Destinations Weekly Departures Weekly Seats Bozeman, MT 96,725 5 10 157 12,779 Great Falls, MT 82,297 4 7 84 5,824

Durango, CO 53,357 4 3 98 5,187 Lewiston, ID-WA 61,137 2 4 34 2,220

Casper, WY 74,700 3 3 44 2,080 Pullman, WA 41,794 1 1 14 1,064 Cheyenne, WY 88,994 2 2 45 1,030 Walla Walla, WA 58,283 1 1 13 988 Klamath Falls, OR 67,543 1 2 21 630 Port Angeles, WA 73,275 1 1 42 462

Source: Source: apgDat, Inc – Schedule July 2011; Woods & Poole Economics, Inc. Note: MSA = Metropolitan Statistical Ar ea; Micro = Micropolitan Statistical Area

4 Northwest region includes Colorado, Idaho, Montana, Oregon, Utah, Washington, and Wyoming.Section 5 Strategic Plan

Page 14 

## 5. Strategic Plan

The strategic Action Plan proposed by the Klamath Fa lls community will achieve the community’s goals,
meet the air service needs and allevi ate the air service deficiencies of this community. This Action Plan section provides a detailed descripti on of the goals of the project and a strategic plan for attaining those goals. A legal sponsor responsible for administ ering the program has been designated and a publicprivate partnership (the air service partnership) has been formed to actively participate in implementing the proposed project. In addition to the strategic Action Plan, this section identifies self-sufficiency of the service as an integral part of the community’s goal s and provides a description of how the community plans to continue with the project if it is not self -sustaining after the grant award expires. A detailed description of the funding necessary for implementati on of the Strategic Plan, including federal and nonfederal contributions, is included in this section.



### A. Public-Private Partnership
The City of Klamath Falls is the owner and operator of the Klamath Falls Airport and the sponsor of this proposal. The following Klamath Falls entities are partic ipating in this effort to improve local air service:

• City of Klamath Falls

• JELD-WEN, inc.

• Klamath Falls Biomass

• JWTR

• Klamath Employment Trends

• Klamath Falls Herald and News

• Basin Mediactive

• Sky Lakes Medical Center

• Iberdrola Renewables

• Klamath Falls Chamber of Commerce

• Discover Klamath (local tourism agency)

• Wynne Broadcasting

For the purpose of continuing air service devel opment work, past SCASDP applications and this application, several of the above entities are part of an ongoing air services partnership formed when Horizon Air left the market in 2008. Some of the orga nizations have been included in this public private partnership for just this application as they are new to the area or have recently come to realize the importance of obtaining increased air service in Klam ath Falls. They have all ex pressed their support and
commitment in letters that are included as Attachment A.

All partners will be fully involved in the execution of the Strategic Plan. The City of Klamath Falls will execute all federal grant offers, process all asso ciated reimbursement reque sts, and oversee grant administration. In addition, the City of Klamath Falls will oversee and fund the air service related consulting services necessary to implement the Strategic Plan. Disc over Klamath will be responsible for administering the $49,000 local advertising and promotion program for this air service initiative in theSection 5 Strategic Plan

Page 15 Klamath Falls area. The Klamath County Chamber of Commerce will assist Discover Klamath with local marketing efforts, particularly to the local business community, and will lead the efforts in generating early
ticket and reservation commitments. The Klamath Falls Herald & News will also assist with the local marketing efforts, specifically with newspaper adv ertising, and will contribute $10,000 (in-kind) in advertising dollars to the promotion effort. Air service partners have committed to an estimated 2200 ticket purchases of the SkyWest Airlines’ early morni ng Portland service during the first year of service with an estimated value of approximately $178,000. However, this ticket purchase estimate has not been included as part of the budget for this project.

Table 5.1 Roles of Public-Private Partners Public-Private Partne r Role

City of Klamath Falls Cash contribution for marketin g campaign; grant and program administration, monitoring.

JELD-WEN, inc Cash contribution; ticket purchases

Klamath Falls Biomass Cash contribution; ticket purchases

JWTR Cash contribution

Klamath Employment Trends Cash contribution; ticket purchases

Klamath Falls Herald and News In-kind contribution; assist with local marketing efforts in Klamath Falls area

Basin Mediactive In-kind contribution; assist with marketing campaign.

SkyLakes Medical Center Cash contribution

Iberdrola Renewables Cash contribution

Klamath Falls Chamber of Commerce In-kind contribution towards marketing campaign

Discover Klamath Cash contribution; coordination of marketing program/promotion in the Klamath Falls area/inclusion of serv ice in existing marketing program

Wynne Broadcasting In-kind contributi on; assist with marketing campaign



### B. Project Goals
The project goals are to improve time of day sched ule coverage and connectivity, mitigate the need to drive long distances to access adequate air servic e, and provide improved access to the global marketplace for the Klamath Falls community. Specif ically, the Strategic Plan outlined herein will provide more air service options to air travelers in this remote Oregon community and support local businesses, universities, healthcare organizations and government employees. The local economy is highly dependent on businesses in Klamath Falls such as JELD-WEN, inc. the Running Y Ranch, OIT and Sky Lakes Medical Center and places high priority in m eeting the air service needs of the businesses in the
Klamath Falls area.Section 5 Strategic Plan

Page 16 

### C. Proposed Air Service
With a catchment area market of approximately 163 passengers per day each way and approximately 10,000 more historical annual enplanements than toda y, the Klamath Falls market is capable of supporting additional service.

The proposed air service to accomplish the project go als includes an additional daily round trip flight between Klamath Falls and Portland in the morning to improve time of day coverage and connectivity to the global marketplace. The service will be provided by SkyWest Airlines operating 30-seat Embraer 120
aircraft.

SkyWest Airlines’ early morning service to Portland would provide ample single connect opportunities for north and eastbound passengers, and many international markets. SkyWest Airlines offers easy connections through their code-share relationship with United Airlines at Portland International Airport. United Airlines, including United Express, serve more than 160 destinations across North America and 200 destinations throughout Europe, Latin America, Asia , and the South Pacific. United Airlines is part of the globe-spanning Star Alliance network. The prop osed service would allow Klamath Falls area air travelers improved access to this global network.

The proposed additional nonstop flight to Portland In ternational Airport will have a significant positive impact on the Klamath Falls economy. Another flight will allow this community to better compete for new businesses and allow existing businesses such as JELD-WEN, inc., government organizations, healthcare entities and college/university employees to significantly lower the amount of travel time required to perform their work. In addition, it w ill benefit the tourism industry for the Klamath Falls economy including Klamath Falls’ Running Y Ranch. Given the region’s growing reputation as a destination community, if new service were made avail able, air travel into the Klamath Falls area would increase opening further options for air service impr ovements. This plan will achieve the project goal by:

• Providing nonstop morning air service to Port land International Airport to/from Klamath Falls, an underserved Oregon community;

• Reducing the need for air travelers to drive to competing airports including Medford’s Rogue Valley International Airport and Portland International Airport.



### D. How This Project Differs from the San Francisco Service Project
The previous application’s goals were specifically targeted at San Francisco service and southbound connections in conjunction with North Bend, Oregon, whereas this application’s goals focus specifically
on northbound connection needs via Portland. San Fr ancisco service serves international and US
southbound travelers and has both dire cted and expanded tourism growth in the region. This project that focuses on an additional flight to Portland is int ended to primarily meet the needs of local and regional businesses by addressing insufficient northbound time of day coverage and connectivity issues of the community. While tourism will also benefit, the lack of morning service is a significant disadvantage to business, government, non-profit and healthcare sectors of the regional economy.Section 5 Strategic Plan

Page 17 

### E. Airline Participation
SkyWest Airlines supports the proposed plan and an estimated service start date of April 2012. The service start date is subject to airline adjustment depending on aircraft availability and other airline considerations. The SkyWest Airlines’ commitm ent letter is included in Attachment A.



### F. Analysis and Forecasts
A financial analysis has been developed for the propos ed additional nonstop Portland International Airport flight. The analysis includes the following assumptions:

• Local Portland passengers will approximate the number of passeng ers that previously existed when Horizon Air served the market with greater time of day coverage.

• Onboard connecting markets will be similar to passengers being carried on the current Portland
service.

• SkyWest Airlines will capture a share of divert ing passengers that are forced to drive to an alternate airport today due to poor time of day coverage.

• SkyWest Airlines will receive a pro-rated share of revenue for those passengers connecting beyond Portland.

• The average one-way segment fare will be based on the reported average fare for year ended March 31, 2011.

The following is a summary of previously reported local market sizes when the schedule provided greater time of day coverage:

Table 5.2 Portland Historical Market Sizes Yea r PDEW Fare $

2001 35.2 100 2002 36.0 106 2003 43.6 106 2004 39.5 114 2005 40.5 119 2006 37.5 133 2007 39.4 122 2008 30.3 108 2009 9.6 78 2010 10.5 81 Source: apgDat

The following is a summary of the pro forma analysis:

Table 5.3 Passenger Projections Item Statistical Category Full Yea r 1 Available Seats per Departure 30 2 Segments per Day 2 3 Days Operating 365 4 Annual Segments 730 5 Annual Seats 21,900 6 Average Cost per Segment $1,800 7 Cost per Year $1,314,000 8 Onboard Passengers 15,768Section 5 Strategic Plan

Page 18 9 Load Factor 72% 10 Total Revenue $1,340,280 11 Average prorated fare $85.00

12 Projected Earnings $26,280 13 Projected Margin 2.0% Source: Mead & Hunt, Inc. Note: SkyWest Airlines LMT-PDX; represents a mature market Passenger projections (Table 5.3) were based on a ma ture market (i.e., passenger projections would be at 100 percent on the first day of service). Table 5.4 provides an adjustment to passenger projections to account for building passenger traffic to a fully ma ture market. The following table breaks down the passenger projections for the first 12 months with service estimated to begin on April 1, 2012:

Table 5.4 Service Ramp-Up

Month Seasonal % Seasonal A dj OO Pax Ramp-Up A dj RampUp OO Pax Days Seats/Month

Apr-12 7.1% 1,119 50% 559 30 1,800 May-12 7.5% 1,181 55% 649 31 1,860 Jun-12 9.1% 1,435 60% 861 30 1,800 Jul-12 8.5% 1,342 65% 873 31 1,860 Aug-12 8.9% 1,401 70% 980 31 1,860 Sep-12 8.5% 1,346 75% 1,009 30 1,800 Oct-12 8.2% 1,298 80% 1,038 31 1,860 Nov-12 9.2% 1,451 85% 1,234 30 1,800 Dec-12 9.6% 1,509 90% 1,358 31 1,860 Jan-13 8.0% 1,257 95% 1,194 31 1,860 Feb-13 7.7% 1,211 100% 1,211 28 1,680 Mar-13 7.7% 1,219 100% 1,219 31 1,860 Total/Yea r 15,768 12,186 21,900 Source: Mead & Hunt, Inc. Note: Ramp-up = 67 percent first month increasing 3 percent until the tenth month.

At the initiation of service, it is estimated that SkyWest Airlines will realize 50 percent of the potential passengers in a mature market. Fo r each subsequent month, it is assumed that SkyW est Airlines will increase passengers by approximatel y 5 percent per month until the elev enth month of service, which is
assumed to be a mature market.

Table 5.5 Net Surplus/Shortfall Projection

Month OO Load Factor Adj Ramp-Up OO Pax Revenue Cost Per Month Net Surplus/Shortfall Apr-12 31% 559 $47,555 $108,000 ($60,445) May-12 35% 649 $55,198 $111,600 ($56,402) Jun-12 48% 861 $73,174 $108,000 ($34,826) Jul-12 47% 873 $74,166 $111,600 ($37,434) Aug-12 53% 980 $83,340 $111,600 ($28,260) Sep-12 56% 1,009 $85,80 6 $108,000 ($22,194) Oct-12 56% 1,038 $88,24 7 $111,600 ($23,353) Nov-12 69% 1,234 $104,8 57 $108,000 ($3,143) Dec-12 73% 1,358 $115,462 $111,600 $3,862 Jan-13 64% 1,194 $101,4 93 $111,600 ($10,107) Feb-13 72% 1,211 $102,914 $100,800 $2,114 Mar-13 66% 1,219 $103,578 $111,600 ($8,022) Total/Yea r 56% 12,186 $1,035,789 $1, 314,000 ($278,211) Source: Mead & Hunt, Inc.Section 5 Strategic Plan

Page 19 Total revenues adjusted for seasonality and the ramp -up period for the first year of service total $1,314,000. This is a shortfall of $278,211.



### G. Action Plan
Although the passenger projections are positive, SkyWest Airlines will undertake a high level of risk during the start-up period that must be partially offse t. The Action Plan addresses issues associated with offsetting SkyWest Airlines’ risk with the implemen tation of an additional morning flight to Portland International Airport that are critical to the long-term success of that service. In this regard, this Action
Plan addresses two essential areas: 1. Airline start-up support
2. Service awareness

(1) Airline start-up support This Action Plan proposes to use a revenue guar antee to limit financial risk and provide incentive to SkyWest Airlines to operate the proposed service. The pro forma projections associated with the proposed air servic e are based on a mature market. However, it is estimated that it will take 10 months for passenger projections associated wi th the proposed air service to reach maturity and match pro forma projections. SkyWest Airlines ’ service is estimated to begin in April 2012. Accordingly, April 2012 passenger traffic and rev enue is estimated to be 50 percent of pro forma projections. Passenger and revenue projection s are expected to grow approximately 5 percent per month between April 2012 and January 2013. At the end of the ten-month ramp-up period, February 2013, passenger and revenue projections are estimated to match the mature market projections shown in the pro forma. The net shortfall for the ten-month ramp-up period is estimated to be approximately $278,211.

To mitigate SkyWest Airlines’ risk, the Action Plan proposes a revenue guarantee of $250,000. This is the minimum amount of revenue guarantee requi red by SkyWest Airlines to initiate this service. The exact terms of the revenue guarant ee agreement are subject to further discussions and negotiation with SkyWest Airlines.

(2) Service awareness This service awareness plan proposes to use adve rtising and promotion to inform the traveling public of the availability of regularly scheduled air service between the communities of Klamath Falls and Portland International Airport. Discover Klamath, the official Klamath County tourism agency, along with the assistance of the Kl amath County Chamber of Commerce and Klamath Falls Herald & News, will have re sponsibility for the advertising and promotion program in the Klamath Falls area. The following elements will be included in the advertising/promotion

program:Section 5 Strategic Plan

Page 20 (a) Marketing message Marketing messages will emphasize the features and benefits of the proposed service to the identified audiences. Messages will focus on the following:

• Airline name: The new service is provid ed by a name brand regional airline with easy connections to United Airlines and their globe-spanning network.

• Convenience: The new service will get pa ssengers to key desti nations with less
inconvenience.

• Cost: The new service w ill reduce the cost of trav el to key destinations.

(b) Target market The target market for the proposed air service are people living in the Klamath Falls area who
have business or leisure travel needs to Port land and beyond destinations. In addition to the local air travelers, business travelers and leisure travelers with interests in travel to Southern Oregon will be targeted. Discover Klamath and the Klamath Falls Chamber of Commerce will assist in reaching this target market by integr ating the new airline service into their existing marketing programs.

(c) Media mix A variety of media outlets will be used to promot e this service. The media mix will potentially include print media (e.g. newspaper ads), televisi on (e.g. local cable networks), radio, internet (Discover Klamath website) and targeted search engine banner advertisement.

(d) Marketing schedule Marketing will begin approximately 60 days prior to the initiation of service and will focus on the features and benefits of the new service, especially the convenience of using the local airports. The initial program will focus on the target audience, solidify travel agent participation, and begin the print and radio advertisements. A significa nt portion of the budget will be expended during the first 60 days of service; however, the tota l advertising and promotion program is planned for
12 months.



### H. Alternate Plan
If the City of Klamath Falls fails to reach an agreeme nt with SkyWest Airlines for additional service to Portland, an alternate plan will be pursued to achieve t he goal of a timely connection to Portland. The City will explore the option of service to Seattle on the incumbent carrier or another carrier (Horizon/Alaska Air) that would provide morning connectivity to Portland as well as other destinations.



### I. Funding and In-Kind Contributions
The City of Klamath Falls is seeking $250,000 of U. S. Department of Transportation funding to mitigate SkyWest Airlines’ risk to provide additional servic e between Klamath Falls and Portland International Airport. The community intends to participate in the funding of the program by providing advertising/promotion (cash and in-kind services) for the service and funding of the necessary programSection 5 Strategic Plan

Page 21 administration, grant monitoring and oversight (in-ki nd services). Table 5.6 provides the Action Plan budget broken down by element and sources of funding:

Table 5.6 Action Plan Budget

Description Funding source

Total US DOT Airport Non-airport

Cash Cash In-Kind Cash In-Kind
Airline Incentive Program:
Revenue Guarantee $250,000 $250,000
MarketingCampaign $2,500 $22,000 $27,500 $52,000 Strategic Plan Monitoring/Program Adminstration: $12,500 $12,500
Airline Meetings/Negotiations: $0
Program Administration: $0
Total $250,000 $2,500 $12,500 $22,000 $27,500 $314,500
Percent of Total Project 80% 1% 4% 7% 8% 100%

Percent of Total Cash Contribution 91% 1% N/A 8% N/A 100%

Non-airport funding sources will provide 8 percent of the funding of the ca sh contribution. In the Klamath Falls area, JELD-WEN, inc. and other businesses are contributing $22,000 for the local, non-airport cash contribution for the marketing program. Discover Klamath, Basin Mediactive, Klamath Falls Herald & News and others are contributing in-kind services fo r additional marketing coverage. Table 5.7 provides
a breakdown of the non-ai rport funding sources.

Table 5.7 Non-Airport Funding Sources Non-Airport Funding Sources Klamath Falls Cash In-Kind JELD-WEN, inc. $12,000 $ - Klamath Falls Biomass $1,500 $ - JWTR $1,500 $ - Klamath Employment Trends $1,500 $ - Klamath Falls Herald & News $ - $10,000 Basin Mediactive $ - $2,000 SkyLakes Medical Center $1,500 $ - Iberdrola Renewables $1,500 $ - Klamath Falls Chamber of Commerce $ - $5,000 Discover Klamath $2,500 $7,500 Wynne Broadcasting $ - $3,000

The community will ensure that its ow n funding contribution, both cash a nd in-kind is spent in the manner proposed by requiring documentation from all partners on a monthly basis tracking both cash and in-kind expenditures. This information will then be included in t he City of Klamath Falls quarterly report to the US Department of Transportation under the rules of the SCASDP grant.Section 6 Schedule and Monitoring

Page 22 

## 6. Schedule and Monitoring

The public-private partnership developed a realistic time table to achieve the goals of this proposal. This section, Schedule and Monitoring, provides the Action Plan schedule and identifies critical milestones to be achieved by the public-private partnership. A monitoring program is also provided to track the progress of the project.



### A. Action Plan Schedule
The proposed service is estimated to begin on April 1, 2012. The marketing program will start 2 months prior to the start of the service on February 1, 2012. The program will run for a total of 12 months.

Table 6.1 Action Plan Schedule



### B. Milestones
The following milestones are proposed to track the progress of this air service initiative:

December 31, 2011 – Airline contract : In order to meet April 1, 2012 start date, a signed contract between the City of Klamath Falls and SkyWest Airlines w ill need to be concluded by December 31, 2011. This will allow the marketing plan to be developed and the airline to load changes into the Computer Reservation System in advance of the new service start date.

January 31, 2012 – Marketing plan development : The marketing plan will be completed by January 31, 2012 to facilitate implementation of the advertisi ng and promotion program in February 2012.

February 1, 2012 – Marketing plan initiation : Advertising and promotion need to be in the market 60 days prior to the new service start date, April 1, 2012.

April 1, 2012 – Service initiation: The service start date is the critical date for the rest of the Action Plan. If this date changes due to airline circumstances and/or equipment availability, other milestone dates will change accordingly. The service start date is not likely to change after the equipment change is loaded in the Computer Reservation System.

March 31, 2013 – Revenue guarantee contract completion: At the end of the first year of service, the revenue guarantee will be calculated based on the terms of the agr eement. If the service start date Action Item 2011 2012 2013 9 10 11 12 1 2 3 4 5 6 7 8 9 10 11 12 1 Grant Award Airline Negotiation Marketing Development Implementation ServiceSection 6 Schedule and Monitoring

Page 23 changes due to airline circumstances and/or equipm ent availability, the rev enue guarantee contract term will change accordingly.

June 30, 2012 – Alternate plan : If SkyWest Airlines has not implemented the proposed service by June 30, 2012, the sponsor will propose an alternate plan that meets the goals of this grant application.



### C. Monitoring Program
The performance of the proposed ai r service will be track ed monthly. Tracking will measure aircraft operations numbers, passenger statis tics, and revenue guarantee indicators. The airline will provide flight segments flown, flight segments cancelled, onboard fared passengers, and average airfares (less taxes and fees). This data will be compared to the foreca st projections to measure the performance of the program and evaluate revenue guarantee payments. In accepting this incentive package, the airline will agree to operate the service for not less than 12 mont hs. This should be sufficient time to prove the viability of the new market. The following table provides the schedule fo r performance measures:

Table 6.2 Performance Measures Performance Measure 2012 2013 4 5 6 7 8 9 10 11 12 1 2 3 Service Period Advertising Campaign

Air Service Performance Cancelled Flights Completed Flights Customer Comments Load Factors Passengers Published Fares Average Airfares Total Revenue



### D. Project Continuati on and Sustainability

As indicated in Table 5.3, it is estimated that afte r the first 12 months of service, the SkyWest Airlines’ Portland service will be self-sustaining with a profit margin of $26,280 or 2 percent in the second 12 months. If, at the end of the second six months of service (months six through 12), the serv ice does not attain a minimum of a 50 percent average load factor, the City of Klamath Falls will extend the marketing program for an additional 3 months.Attachment A Analysis and Forecasts

Page 24 

## Attachment A. Airline & Community support

Attachment A includes letters of support for the City of Klamath Falls’ application to the U.S. Department of Transportation for additional SkyWest Airlines’ servic e to Portland Internationa l Airport. Support letters were submitted by SkyWest Airlines, participants in the public-private partnership, and members of the Klamath Falls community. The letters of support are included on the following pages of this Attachment
A.

### July 27, 2011

Aloha Ley US Dept. of Transportation 400 7 th 

### Street SW Room 6401 Washington, DC 20590

RE: Partnership Opportunities

Dear Ms. Ley,

Discover Klamath Visitor and Convention Bureau is pleased to submit this letter of support for the Klamath Falls Airport grant application to the U.S. Department of Transportation Small Community Air Service Development Grant Program. Discover Klamath Visitor and Convention Bureau is anxious to partner with the Klamath Falls Airport for the mutual objective of driving more visitors to our community while promoting the Klamath Falls – Portland connection.

While there is still work to be completed in terms of working through specific tactical approaches, timing of campaign, etc..., our group is nonetheless supportive of the airport’s goals, as they mirror ours as well.

To this end, Discover Klamath would like to commit up to $2500 in cash and $7500 in in-kind electronic marketing/advertising for purposes of supporting this exciting initiative.

Again, Discover Klamath Visitor and Convention Bureau strongly supports this grant application and we hope that you will give it favorable consideration.

Best Wishes, 

# Jim Chadderdon

Jim Chadderdon Executive Director

### July 25, 2011

Aloha Ley US Dept. of Transportation 400 7 th 

### Street SW, Room 6401 Washington, DC 20590

Subject: Small Community Air Service Development Grant Application Docket OST-2011-0119 Klamath Falls, OR

Dear Ms. Ley:

The Herald and News strongly supports the grant app lication to the U.S. Depa rtment of Transportation for funding of its program to init iate an additional round trip flight between Portland and Klamath Falls.

The Herald and News commits to supporting the nort hbound Essential Air Service grant with a $10,000 advertising match. We recognize the contribution th at quality, commercial air service will make to the economic vitality of our area. The additional support this service brings to our growing area businesses, organizations and institutions through improved access for visitors is invaluable.

The Herald and News is pleased to have the opportunity to support this grant application. We will work diligently to insure the long-term success of this air service through not only our support but the combined efforts of our Klamath Falls community.

Sincerely,

Kendal Daiger Director of Advertising Herald and News 541.885.4423 direct 541.883.4007 fax kdaiger@heraldandnews.com“The Klamath County Chamber of Commerce is committed to Klamat h County by advancing its econom ic vitality and quality of life through the education, promotion and networking of our members” 

# Klamath County Chamber of Commerce

205 Riverside Street Suite A  Klamath Falls, Oregon 97601 (541) 884-5193 Phone  (541) 884-5195 Fax www.klamath.org - inquiry@klamath.org

Board of Directors

Jodi Kucera
Mia & Pia’s Pizzeria & Brewhouse Barb Meng
US Cellular –Cellular Solutions Stan Gilbert Klamath Youth Development Center Toby Freeman

Pacific Power Heidi Wright
Herald and News Shari Watterberg Integra Telecom Tim Wehrly

Above & Beyond Catering Bridgitte Griffin South Valley Bank & Trust Curtis Waite 173d Fighter Wing, Kingsley Field Dan Keppen Dan Keppen & Associates, Inc Kathie Philp
Pacific Crest FCU Willie Riggs
OSU Extension Office Linda Thompson Fred Meyer Stores Ellsworth Lang
Kla-Mo-Ya Casino Mike Angeli The Ledge Rachael Spoon

KBHBA Reba Van Acker The Epicenter Randy Shaw

Coldwell Banker/Holman Premier Realty

Ex-Officio Members

City of Klamath Falls Klamath County

KCEDA Oregon Institute of Technology Klamath Community College

KUHS DECA

Staff

Charles Massie
Executive Director Heather Tramp Programs & Marketing Coordinator 

### July 27, 2011

Aloha Ley US Dept. of Transportation 400 7 th 

### Street SW Room 6401 Washington, DC 20590

Subject: Small Community Air Service Development Grant Application Docket DOT-OST-2011-0119 Klamath Falls, OR

Dear Ms. Ley:

The Klamath County Chamber of Commerce is pleased to submit this letter of support for the Klamath Falls Airport grant application to the U.S. Department of Transportation Small Community Air Service Development Grant Program. We believe that there is high demand for a second round trip flight between Portland and Klamath Falls and that it will contribute greatly to the economic vitality of our area. We recognize the importance of quality commercial air service to the economy through improved access for visitors, and most importantly, to support area businesses, organizations and institutions.

We are willing to donate $5,000 of local advertising and marketing support to promote air service between Klamath Falls and Portland should the Klamath Falls Airport receive a grant.

The contemplated improvements will bring the material benefits of scheduled air transportation to a broad section of the traveling public, including businesses, educational institutions, and other enterprises whose access to the national air transportation system is limited.

Again, the Klamath County Chamber of Commerce strongly supports this grant application and we hope that you will give it favorable consideration.

Sincerely,

Charles Massie Executive Director6400 Highway 66

, Klamath Falls

, OR 97601

Phone : 54 1 -884

- 2240 F ax: 54 1

· 880

· 548 T 

# JWTR

July 28, 2011

Aloha Ley US Dept. of Transportation 400 

## i h 

### Street SW Room 6401 Washington, DC 20590

Subject: Small Community Air Service Development Grant Application Docket DOT -OST -2011-0119 Klamath Falls, OR

Dear Ms. Ley:

JWTR, LLC is pleased to submit this letter of support for the Klamath Falls Airport grant application to the U.S. Department of Transportation Small Community Air Service Development Grant Program. We believe that there is high demand for a second round trip flight between Portland and Klamath Falls and that it will contribute greatly to the economic vitality of our area. We recognize the importance of quality commercial air service to the

economy through improved access for visitors, and most importantly, to support area businesses, organizations and institutions.

JWTR, LLC is pledging $1,500 in cash towards the advertising and promotion of this second roundtrip flight to Portland.

The contemplated improvements will bring the material benefits of scheduled air transportation to a broad section of the traveling public, including businesses, educational institutions, and other enterprises whose access to the national air transportation system is limited.

Again, JWTR, LLC strongly supports this grant application and we hope that you will give it favorable consideration.

President

# SKY 

# lAKES

MEDI \L CE :TER

!FE: 

### HALING: PEAC**~.**

2SI1:; Dilggelt \\Tntll' KI'lll1'lth r<lll 01 J7h( I Ph 'i-ll SS2 (111 h 541 2/ 11 725 P,lull'. 'it '\ ,lrt
1'1 ""jd 'Ilt " lEO



### July 27, 2011

Aloha Ley US Dept. of Transportation
400 7 th 

### Street SW**R~m** 

### MOl 

### Washington, DC 20590

Subject: Small Community Air Service Development Grant Application
Docket DOT-OST-2011-0119
Klamath Falls, OR

Dear Ms. Ley:

Sky Lakes Medical Center is pleased to submit this letter of support for the Klamath Falls Airport grant application to the U.s. Department of Transportation Small Community Air Service Development Grant Program. We believe that there is high demand for a second round trip flight between Portland and Klamath Falls and that it will contribute greatly to the economic vitality of

our area. We recognize the importance of quality commercial air service to the economy through improved access for visitors, and most importantly, to support area businesses, organizations and institutions.

Sky Lakes Medical Center pledges $1,500 

### in cash towards the advertising and promotion of this second roundtrip flight to Portland.

The contemplated improvements will bring the material benefits of scheduled air transportation to a broad section of the traveling public, including businesses, educational institutions, and other enterprises whose access to the national air transportation system is limited.

Again, Sky Lakes Medical Center strongly supports this grant application and we hope that you will give it favorable consideration.

# 7~-----"' Paul R. 

### Stewart
President and CEO07/28/2011 IQ:31 SQ18842845 INNNE BROADCASTII'JG



### July 27, 2011

Aloha**Lt~y** 

### US Dept. of Transportation 400 7 th Street SW Room 6401 

### Washington, DC 20590

Subject: Small Community Air 

### Service Development Grant 

### Applicat on Docket DOT·OST··2011-0119 Klamath FalJs, OR



### Dear Ms. Ley:

Vlynne Broadcasting is 

### pleased 10 submit 

### this letter OfSUPPClrt for the Klan:ath Falls Airport grant appHcatbn to the U.S. Department of Transportation SmaJl Comm1Ully Air Service Development Grant Program. We believe th.at there is high demand for a s**~cond** round trip flight between P,xtland 

### aDd 

### Klarr".ath 

### FaIls and that 

### it will 

### contribl1te great!;' to the economic vitality of our 

### area, We recognize 

### the importance of 

### quality commercial ai

. service to the
economy 

### t.lJrQugh improved 

### <J.Gcess for visitors, i?.nd most importantly, 

### to su 

### pport area 

### businesse,;, organizations 

### and institutions.

We W: \Villing to donate $3,000 of advertising to promote air servic.e betw :efJ Klamath Falls al.d P01tlancl should 

### the Klamath Falls Airport receive a grant



### The contemplated 

### improvements ' N111 

### bring 

### th\': material benefits of 

### schedu ,ed air transportatior

to a broad. Sel.'tioD of ljle traveling

### public~ including b\lSinesses

.. educatiQoa institutions, and otl.e.r enterprises whose access to the national air transportation system is 

### limitec,

Again, WyntiC 

### Broadcasting strongly supports thjs 

### grant application and 

### v, e hope thai you 

### "Yill give it 

### f::\vorable consideration,



### Sinctdty, 

# ''-1

# I~~~~n/X:

Wynne**Brooad~asting** Co., Jne, • P.O. Box 141Q • K!am211h r<lU3. OR 97601·02lH • pn. {541 ) eS;J·4656 • fa); (541}**~.84-2845**

### DEPARTMENT OF THE AIR FORCE
173D FIGHTER WING KINGSLEY FIELD OREGON

08 July 2011

Mr. Michael Thompson VP Market Development SkyWest Airlines 444 South River Road St George, Utah 84790

Dear Mr Thompson:

I understand that United Express which is being operated by SkyWest is considering restoring a flight to and from Portland for at least two flights to and two flights from Portland Airport each day. We are specifically interested in an early departure to Portland from Klamath Falls and a late return to Klamath Falls.

It is difficult to calculate an exact amount of support due to the fact that we do not have prices, timetables,

or a specific time for when service would begin; However, based on our best good faith estimate, and assuming schedules and process would remain at their current level, or improve, we estimate our commitment to fly United Express to Portland would increase by 45 roundtrips per month

Kingsley Field is the nation's premier training site for F-15 pilots, and home of more than 800 citizen Airmen. Co-located at the Klamath Falls Airport, it is our mission to prepare the next generation of fighter pilots, in addition to serving our state and Nation during times of peace and war. The men and women of Kingsley field routinely travel all over the United States for training, conference attendance, and other duty directed purposes. The addition of additional airline service would greatly enhance our ability to travel effectively.

We hope your early review of increasing the number of trips between Portland and Klamath Falls is a favorable one and we look forward to further discussions with representatives of SkyWest, United Express, the Klamath County Chamber of Commerce and the City of Klamath-Falls Airport.

Sincerely,

## ;7je~ VAMES

# ~MI:ER, Colonel, ORANG

Commander

Cc: Klamath County Chamber of Commerce, 205 Riverside Drive Suite A, Klamath Falls, OR 97601; Klamath Falls Airport, 6775 Arnold Avenue, Klamath Falls, Or 97603

### I4i 002/002 

### 07/28/2011 08:07 FAX 541 883 3724 BELL HARDWARE KFALLS



### July 27,2011

Aloha 

### T,ey 

### US Dept. of Transponation 400 7th 

### Street SW RooUl 

### 6401 Washington, DC 20590

Subje<:t: Small Community Air Service Development (irant Application Docket DOT 

### -OST- 2011-0119 

### Klamath**Falls~** 

### OR

Dear Ms. Ley:

Bell Hardware is**plt~ased** 

### to submit**thi~** 

### letter of support J()T 

### the Klamath**Fall~** 

### Airport grant application to 

### the U-S. Department of Transportation Small 

### Community 

### Air Service Development Grant Program. We believe that there 

### is high demand for 

### a second 

### round trip flight betwcen Portland and Klamath 

### Falls and that it will c<Jntributc greatly to the economic.; vitality of our area. We recognize 

### the importance of quality commercial air service to the
economy tluough improved access for visitors, and most importantly, to support area businesses, organizations and institutions.

It 

### is difficult to calculate an exact amount of support due to the fact that we do not have prices, timetables, or a specific time for when service would begin; however, 

### based on our best good faith estimates we would expect to commit 

### to an additional 4 roundtrips to Portland per 

### month.

The contemplated improvements will bring the matcrial benefits of scheduled air transportation

to a broad section of the traveling public, including businesses, educational institutions, and other enterprises whose access to the national air transportation system is limiteu.

Again, Bell Hardware strongly supports 

### this grant application and we hope that 

### you will give it favorable consideration.

\ Preside 

### t**~_** 

### Hell ardware Sincerely, 

# \ /

( John 

### B 1107/25/2011 1520 TEL 5418841970 CASCADE @ 001

July 27, 2011

Aloha Ley US**D~t.** of Transportation 4300 7**S~** SW Room 6401 Washington, DC 20590

Subject: Small Community Air Service Development Grant Application Docket DOT-OST-2011-0119 Klamath Falls, OR

DeIII' Ms. Ley:

Cascade Auto Group is pleased to submit this letter of support for the KI8TTIatfJ Falls Airport grant application to the U.S. Department of Trnnsportation Small Community Air Service Development Grant Program. We believe that there is high demand for lL second round trip fligbt between PortlWld and Klamath Falls and that it will contribute greatly to the economic vitalitY of OW' area. We recognize the importance of quality commercial air service to the economy through improved access fur**visito~.** lUld
most importantly, to support area businesses, ol"ganiozations and institutions.

It is difficult to calculate an exact amount of support due to the fact that we do not have prices, timetables,

or a specific time for when service would begin; however, based on our best good faith estimates we would expect to commit to an additional 6 roundtrips to 

### Portland per month.

The contemplated improvements 

### will bring the material benefits of scheduled air transportAtion to a broad section of the traveling public, including bUllinesses, educational instirutions and other enterprises whose

access to the national air transportation system is limited.

Again, Cascade Auto Group strongly supports this grant application and we hope that you will give it favorable consideration.

Sincerely,

Trish Salvati General Manager

CASCADE AUTO GROUP

### ~.o. Box 7399 • 2810 Washbum Way •

### KI~math 'Fells, OR 97602-0399 • Fax: 541.8S.4·101S • Bus: 541.883.7701

: .' : .) .'

..**:~.~.";"**

### July 27, 2011

Aloha Ley US Dept. of Transportation 400 7 th 

### Street SW Room 6401 Washington, DC 20590

Subject: Small Community Air Serv ice Development Grant Application Docket DOT-OST-2011-0119 Klamath Falls, OR

Dear Ms. Ley:

Holliday Jewelry is pleased to submit this letter of s upport for the Klamath Falls Airport grant application to the U.S. Department of Transportation Small Community Air Service Development Grant Program. We be lieve that there is high demand for a second round trip flight between Portland and Klamath Falls and that it w ill contribute greatly to the economic vitality of our area. We recognize the importance of quality commercial air service to the economy through improved access for visitors, and most importantl y, to support area businesses, organizations and institutions. It is difficult to calculate an exact amount of support due to the f act that we do not have prices, timetables, or a specific time for when serv ice would begin; however, based on our best good faith estimates we would expect to commit to an additional 12-15 round-trips to Portland per
year. The contemplated improvements will bring the mate rial benefits of scheduled air transportation to a broad section of the travel ing public, including busin esses, educational institutions, and other enterprises whose access to the national air transportation system is limited.

Again , Holliday Jewelry strongly supports this grant application and we hope that you will give it favorable consideration.

Sincerely,

Raymond E Holliday

### July 27, 2011

Aloha Ley Office of Aviation Analysis 1200 New Jersey Avenue, SE, W86-310 Washington, DC 20590

Subject: Small Community Air Service Development Grant Application Docket DOT-OST 2011-0119 Klamath Falls, OR

Dear Ms. Ley:

JELD-WEN, inc. is pleased to submit this letter of support for the Klamath Falls Airport grant application to the U.S. Department of Transportation Small Community Air Service Development Grant Program (SCASDP). We believe that ther e is high demand for a second round trip flight between Portland and Klamath Falls and that it w ill contribute greatly to the economic vitality of our area. We recognize the importance of quality commercial air service to the economy through improved access for visitors, and most impor tantly, to support area businesses, non-profit organizations, and educationa l and healthcare institutions.

It is difficult to calculate an exact amount of supp ort due to the fact that we do not have prices, timetables, or a specific time for when service would begin. However, based on our best good faith estimates we would expect to commit to an additional 200 roundtrips to Portland per month, and this number could increase significantly as economic conditions improve.

The contemplated improvements will bring the materi al benefits of scheduled air transportation to a broad section of the traveling public, includi ng businesses, educational institutions, and other enterprises whose access to the national air transportation system is limited.

Again, JELD-WEN strongly supports this grant application and we hope that you will give it favorable consideration.

Sincerely,

Michelle Halle External Affairs

# Klamath Youth Development Center

2210 Eldorado Avenue ● Klamath Falls, OR 97601 ● (541) 883-1030

July 27, 2011

Aloha Ley US Dept. of Transportation 400 7 th 

### Street SW Room 6401 Washington, DC 20590

Subject: Small Community Air Service Development Grant Application Docket DOT-OST-2011-0119 Klamath Falls, OR

Dear Ms. Ley:

I am writing in support of the Klamath Falls Airport grant application to the U.S. Department of Transportation Small Community Air Service Development Grant Program.

I operate the largest mental health clinic for childr en in this region of the state. I also currently serve on two state mental health planning and advis ory committees, both of which meet monthly in either Salem or Portland. Also, when the Oregon Legislature is in session, I travel more frequently to Salem to advocate for issues important to my industry. Prior to reducing flights going north from Klamath Falls my routine practice was to fly to Portland, rent a car to attend my meetings, then fly back to Klamath Falls in the late afternoon or later that night. Since flights have been reduced I've been forced to drive to these meetings, which is not a very efficient use of time. I would much prefer to return to the one day travel cycle.

I believe that there is high demand for a second round trip flight between Portland and Klamath Falls and that it will contribute greatly to the economic vitality of our area. We recognize the importance of quality commercial air service to the economy through improved access for visitors, and most importantly, to support area businesses, organizations and institutions.

It is difficult to calculate an exact amount of support due to the fact that we do not have prices, timetables, or a specific time for when service would begin; However, based on our best good faith estimate, and assuming schedules and process would remain at their current level, or improve, we estimate our commitment to fly United Express to Portland would increase by at least two roundtrips per month.

The contemplated improvements will bring the ma terial benefits of scheduled air transportation to a broad section of the traveling public, including businesses, educational institutions, and other enterprises whose access to the national air transportation system is limited. I strongly support this grant application and we hope that you will give it favorable consideration.

Sincerely, 

# Stanley Gilbert

Stanley Gilbert, Chief Executive Officer

## Hands

- on education for real

- world achievement Christopher G. Maples, President 3201 Campus Drive Klamath Falls, OR 97601 USA Phone: 541.885.1112 FAX: 541.885.1101 chris.maples@oit.edu

July 27, 2011

Aloha Ley US Dept. of Transportation 400 7 th 

### Street SW Room 6401 Washington, DC 20590

Subject: Small Community Air Service Development Grant Application

Docket DOT

- OST

- 2011

- 0119 Klamath Falls, OR

Dear Ms. Ley:

Oregon Institute of Technology is pleased to submit this letter of support for the Klamath Falls Airport grant application to the U.S. Department of Transportation Small Community Air Service Development Grant Program. We believe that there is high demand for a second round trip flight between Portland and Klamath Falls and that it will contribute greatly to the economic vitality of our area. We recognize the importance of quality commercial air service to the economy through improved access for visitors, and most importantly, to suppo rt area businesses, organizations and institutions.

It is difficult to calculate an exact amount of support due to the fact that we do not have prices, timetables, or a specific time for when service would begin; however, based on our best good faith esti mates we would expect to commit to an additional 6

- 12 roundtrips to Portland per month.

The contemplated improvements will bring the material benefits of scheduled air transportation to a broad section of the traveling public, including bu sinesses, educational institutions, and other enterprises whose access to the national air transportation system is limited.

Again, Oregon Institute of Tech n ology strongly supports this grant application and we hope that you will give it favorable consideration.

Sincerely,

Christopher G. Maples President

### July 27, 2011

Aloha Ley US Dept. of Transportation 400 7 th 

### Street SW Room 6401 Washington, DC 20590

Subject: Small Community Air Servi ce Development Grant Application Docket DOT-OST-2011-0119 Klamath Falls, OR

Dear Ms. Ley:

Seasons Change LLC is pleased to submit this letter of support for the Klamath Falls Airport grant application to the U.S. Department of Transportation Small Community Air Service Development Grant Program. We believe that there is high demand fo r a second round trip flight between Portland and Klam ath Falls and that it will cont ribute greatly to the economic vitality of our area. We recognize the importa nce of quality commercial air service to the economy through improved access for visitors, and mo st importantly, to s upport area businesses, organizations and institutions.

It is difficult to calculate an exact amount of support due to the f act that we do not have prices, timetables, or a specific time for when servic e would begin; however, based on our best good faith estimates we would expect to commit to an additional 3 roundtrips to Po rtland per year.

The contemplated improvements will bring the mate rial benefits of scheduled air transportation to a broad section of the travel ing public, including busin esses, educational in stitutions, and other enterprises whose access to the national air transportation system is limited. Again, Seasons Change LLC, strongly supports this grant app lication and we hope that you will give it favorable consideration.

Sincerely,

Angela Day Office ManagerJUL-2&-2011 (TUE) 07: 38 POOl/DOl



# STERLI NG r;;.)SIn SAVINGS

## BANK~

_____ 8USINESS SANKING

To Whom it May Concern,

Sterling Savings Bank has 5 branches and a commercial banking team in Klamath County. Our corporate
head quarters are in Spokane. We are often called to Spokane or Portland for business meetings and training. Since United Express took over air service, I personally have found that travel from Klamath
Falls is not efficient. Two out of three trips I took with them left me ln other locations (once Medford
and once in Redding) where I was responsible for getting myself home. This caused an additional

expense to Sterling Savings Bank and a loss of productivity.

I currently fly out of Medford when I need to make a business trip since they have good connections and

seem to be able to get you where you want to go. I would appreciate additional connections to
Portland in the early morning. I know that there are other Sterling Savings employees that would utilize
the flight as well. Thanks for the consideration.



### I

# ~~ Jennifer Scanlan

Commercial Banking Team Leader

Sterling Savings Bank

541-880-7100

540 MAIN STREET

KLAlvlATH FALLS, OR 97601
I:' H 0 N E:: 4 1 • 1;1 EI Z - 3 4 4 4 FAX: 5 4 1 • Z 7 :3

- 0 6 5 6

### July 27, 2011

Aloha Ley US Dept. of Transportation 400 7 th 

### Street SW Room 6401 Washington, DC 20590

Subject: Small Community Air Service Development Grant Application Docket DOT-OST-2011-0119 Klamath Falls, OR

Dear Ms. Ley:

Yainix Ranch is pleased to submit this letter of support for the Klamath Falls Airport grant application to the U.S. Department of Transportation Small Community Air Service Development Grant Program. We believe th at there is high demand for a second round trip flight between Portland and Klamath Falls and that it will cont ribute greatly to the economic vitality of our area. We recognize the importance of quality commercial air service to the economy through improved access for visitors, and most importantly, to support area businesses, orga nizations and institutions.

It is difficult to calculate an exact amount of support due to the fact that we do not have prices, timetables, or a specific time for wh en service would begin; however, based on our best good faith estimates we woul d expect to commit to an additional 4 roundtrips to Portland per month.

The contemplated improvements will bring th e material benefits of scheduled air transportation to a broad secti on of the traveling public, incl uding businesses, educational institutions, and other enterprises whose access to the national air transportation system is limited.

Again, Yainix Ranch strongly supports this grant applic ation and we hope that you will give it favorable consideration.

Sincerely,

Becky Hyde