Application Under the Small Community 

Air Service Development Program 

Docket DOT-OST-2012-0069

Legal sponsor: City of Redmond, Oregon 

c/o Redmond Municipal Airport 

DUNS: 09-720-4072 

Tax ID: 93-6002242 

Congressional District Code: OR-02 

Contact: Kim Dickie, CM 

Redmond Municipal Airport · 2522 SE Jesse Butler Circle #17 · Redmond, OR 97756-8643 

(541) 504-3496 · kim.dickie@ci.redmond.or.us 

Redmond Municipal Airport 

Redmond, Oregon


Application Under the Small Community Air Service Development Program 

City of Redmond/Redmond Municipal Airport Table of Contents

Prepared by 

Table of Contents 

Page 

Application Highlights ........................................................1

Air Service Not Keeping Pace With Growth ...............................................1

Solid Strategic Plan with Significant Community Commitment ..................1

Experienced and Successful Partnership ....................................................2

Material Benefits to an Isolated Region .....................................................2

Air Service Environment .....................................................3

Geographically Isolated Catchment Area ..................................................3

Long and Difficult Drive to Alternate Airports............................................3

Rapidly Growing Population .....................................................................4

Robust Economy ......................................................................................4

Air Service – Existing and Historical ..................................6

Existing Air Service ...................................................................................6

Historical Air Service .................................................................................6

Past Air Service Development Efforts .........................................................8

Air Service Needs and Deficiencies....................................9

Underserved Market .................................................................................9

Market Need/Demand for Direct Flights to Southern California .................9

Higher Than Average Airfares to Los Angeles .......................................... 10

Strategic Plan – Air Service ..............................................11

Project Goal ........................................................................................... 11

Proposed Air Service ............................................................................... 11

Detailed Market Analysis ........................................................................ 11

Alternate Plan ........................................................................................ 13

Previous SCASDP Goals Successfully Achieved......................................... 13

Strategic Plan – Implementation and Funding ...............15

Public-Private Partnership........................................................................ 15

Incentive and Support Plan ..................................................................... 15

Strategic Plan Funding ............................................................................ 19

Project Continuation and Sustainability ................................................... 19

Schedule and Monitoring .................................................20

Strategic Plan Schedule and Milestones .................................................. 20

Strategic Plan Monitoring Program ......................................................... 21

Appendix A. Marketing Plan ............................................22

Target Audience ..................................................................................... 22

Air Service Support Program – Los Angeles ............................................. 22

Marketing to Central Oregon’s Business Community .............................. 25

Appendix B. Community Support ....................................26

Government ........................................................................................... 26

Public-Private Partnership........................................................................ 26

Businesses and Organizations ................................................................. 26
 Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Application Highlights

1 

Application 

Highlights 

he City of Redmond, the sponsor of this Small Community Air Service 

Development Program (SCASDP) grant application, in cooperation with its 

private partners, is requesting $500,000 in federal assistance to implement a 

$1,235,000 air service initiative. The City of Redmond, Economic Development for 

Central Oregon, and the Central Oregon Visitors Association have formed a publicprivate partnership. This partnership has a history of air service success, including a 

2003 SCASDP grant award. This application is requesting assistance with a different 

project and goal. 

The goal of this grant application is to acquire nonstop southern California service. 

To achieve this goal, the Strategic Plan targets nonstop service by American Airlines, 

Delta Air Lines, or United Airlines to Los Angeles International Airport. 

Air Service Not Keeping Pace With Growth 

The population and business activity in Central Oregon has been growing rapidly, 

putting strain on transportation in the region. The population in Central Oregon is 

growing over three times faster than the US average. Plus, over three million people 

visit Central Oregon annually. The loss of Alaska Airlines’ nonstop Los Angeles 

service in 2010 combined with other cuts in service during the recession and 

Allegiant Air’s recent announcement of ceasing Redmond service has caused 

Redmond Municipal Airport to fall short of meeting market demand and the 

growing needs of the population. 

Without nonstop service, Central Oregon travelers destined for southern California 

are forced to connect or drive over mountainous roads to alternate airports, 

creating significantly longer travel times and higher travel costs. Because of this, 

travel to Los Angeles International Airport has dropped by over 50 percent since the 

loss of nonstop service. Reinstating nonstop southern California service is a top 

priority of the Central Oregon community. 

Solid Strategic Plan with Significant Community Commitment 

The Strategic Plan for meeting the project goal is sound, sustainable, and supported 

by the Central Oregon community. The Strategic Plan is supported by the following: 

• Proven market: For year ended June 30, 2010, an average of 33.3 

passengers daily each way or over 24,000 origin and destination 

passengers annually were destined for Los Angeles and used Alaska’s once 

T

This section contains: 

• Project goals 

• Description of the 

Strategic Plan 

• Highlights of the grant 

application 
 Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Application Highlights

2 

daily, nonstop service. This passenger volume can easily sustain one 

roundtrip daily in a 44- to 50-seat regional jet. 

• Tested and proven support program: To support the Strategic Plan, the 

risk sharing plan proposed by the public-private partnership includes a 

community-funded marketing campaign, an Airline Travel Bank®, fee 

waivers, and a revenue guarantee funded by the US Department of 

Transportation (DOT) and the Central Oregon community. 

• Non-airport sources funding 36 percent of cash requirement: Sixty 

percent of total project funds will be contributed by the Central Oregon 

community including: $300,000 cash from non-airport sources, $25,000 

from the Redmond Municipal Airport, and in-kind services (i.e. Airline 

Travel Bank® and program administration) of $365,000 by publicprivate partners. 

• Realistic timetable: The schedule proposed will ensure timely use of 

grant funds. 

Experienced and Successful Partnership 

The City of Redmond/Redmond Municipal Airport, Central Oregon Visitors 

Association, and Economic Development for Central Oregon are a proven 

partnership. These partners have experience with air service development efforts 

and effectively used funds from a 2003 SCASDP award to add eastbound air service 

to Central Oregon. Shortly after grant award in late 2003, Redmond Municipal 

Airport secured two daily roundtrips by Delta Air Lines to Salt Lake City International 

Airport. Aided by a $626,000 Airline Travel Bank®, the service was a quick success 

and Delta added a third roundtrip within the first year. At the end of the first year 

of service, because of the instant success, the revenue guarantee funded by the US 

DOT through the SCASDP was not needed and was returned for alternate uses. 

Material Benefits to an Isolated Region 

Access for Central Oregon’s remote population exceeding 230,000 to larger centers 

of air service entail a difficult drive through predominantly two-lane mountain 

roads, which necessitate the use of traction tires during much of the winter. Central 

Oregon is one of the largest metro areas in the US not on an interstate. With a 

growing population and thriving business community, the air service improvement 

plan proposed in this grant application will benefit a broad segment of the traveling 

public, including business, educational institutions and tourism. 

 

Non-airport sources 

are funding 36 

percent, $300,000, of 

the cash requirement. 

Sixty percent of the 

total project funds 

will be contributed by 

the Central Oregon 

community. 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Air Service Environment

3 

Air Service 

Environment 

his section provides Central Oregon’s community profile highlighting the 

economic and demographic attributes of the Redmond Municipal Airport 

catchment area. It identifies the businesses, institutions, government 

branches, and population that will benefit from improved access to the national air 

transportation network. 

Geographically Isolated 

Catchment Area 

Redmond Municipal Airport serves a 

geographically isolated area east of the 

Cascade Range. The core of the 

catchment area is made up of Crook, 

Deschutes, Jefferson, and Wheeler 

counties. In addition, portions of Grant, 

Harney, Lake, and Klamath counties 

also use Redmond Municipal Airport. 

Overall, the catchment area (Exhibit 

2.1) is 21,411 square miles, larger than 

Vermont and New Hampshire 

combined, and includes a population 

of 232,800, the majority of whom live 

in Deschutes County. 

Long and Difficult Drive to Alternate Airports 

Based on a study completed by Mead & Hunt for calendar year 2011, an estimated 

22 percent of Redmond Municipal Airport catchment area passengers, almost 

120,000 origin and destination passengers annually, use Portland International 

Airport and an additional 13,125 annual passengers use the Eugene Airport rather 

than the local airport. From Redmond, traveling to Eugene requires a 136-mile drive 

(approximately three hours), and driving to Portland requires a 142-mile drive 

(approximately three hours, 15 minutes) ignoring the impact of weather and major 

traffic congestion. Both alternatives entail a difficult drive through predominantly 

two-lane mountain roads, which necessitate the use of traction tires during much of 

the winter. With such a geographically large catchment area, drive times to all three 

airports vary; however, driving to Portland or Eugene requires an unacceptable time 

outlay, expense, and risk passing over the Cascade Range. 

T

This section contains: 

• Description of Central 

Oregon in relation to air 

service 

Exhibit 2.1 Airport Catchment Area and Proximity to Competing Airports 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Air Service Environment

4 

Rapidly Growing Population 

From 2000 to 2010, the Central Oregon population (measured by Deschutes 

County) grew 36 percent, triple Oregon’s 12 percent growth and the nation’s 10 

percent growth (Table 2.1). Most of Central Oregon’s growth is due to inmigration of new residents drawn by predominantly sunny weather and year-round 

recreational activities that have made Central Oregon a top tier place to live and 

play in the US. These same attributes have resulted in a number of smaller 

businesses (particularly in the high technology sector) to relocate or create start-up 

businesses in the catchment area. 

Robust Economy 

Central Oregon is focused on economic and business development and tourism 

expansion. Over the past decade, the region has seen strong growth in professional 

and business services, education and health services, and financial activities. Other 

areas of strength include pharmaceutical research, software, electronics and 

brewing. With a growing tourism base, the leisure and hospitality sector has also 

experienced strong year over year growth. The area’s key employers dependent on 

air service are shown in Table 2.2, next page. 

Leisure, Hospitality, and Second Homes 

Central Oregon has become a year-round destination resort area for visitors and 

tourists worldwide. It is estimated that over 3.2 million overnight visitors come to 

Central Oregon annually. The area served by Redmond Municipal Airport offers 

premiere skiing (Mt. Bachelor, Willamette Pass, and Mt. Hoodoo), golfing (over 30 

courses, some ranked among the top 10 in the US), other numerous outdoor 

activities, and world-class destination resorts (including 12 large scale 

developments). Over $800 million in resort development has been completed in 

Central Oregon in the past 10 years. In addition to Central Oregon vacationers, 

thousands of people own second homes in the area. 

Financial 

Financial firms generate a significant amount of air travel; few small communities 

have a financial sector as strong as Central Oregon. The region supports 19 banks, 

credit unions, savings and loan organizations with a total of 79 branch locations. 

Three institutions, Bank of the Cascades, Mid-Oregon Federal Credit Union, and 

High Desert Bank, are headquartered in the area, and an additional five 

organizations are headquartered elsewhere in Oregon. Reflecting higher than 

average deposit wealth, Central Oregon supports a significant number of financial 

planning and investment firms. 

Table 2.1 Population Growth 

Comparisons 

Rank Oregon 

County 

Population 

Growth 

2000-

10 

2010-

20 

1 Deschutes 36% 29%

2 Polk 21% 15%

3 Washington 19% 30%

4 Yamhill 17% 14%

5 Linn 14% 8%

6 Jefferson 13% 10%

7 Columbia 13% 10%

8 Jackson 12% 10%

9 Multnomah 12% 4%

10 Clackamas 11% 13%

OREGON 12% 12%

US 10% 10%

Source: Woods & Poole Economics, Inc. 

Redmond Municipal 

Airport’s air service 

has struggled to keep 

up with population 

growth and the 

robust economy.
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Air Service Environment

5 

High Technology 

Numerous companies from the Silicon Valley, 

southern California, Portland-Vancouver 

Metropolitan Area, and Puget Sound have 

relocated or expanded in Central Oregon 

escaping skyrocketing utility, wage and other 

operating costs. Many of these firms are small 

but extremely innovative, producing nichemarket products from semiconductors to 

software and medical instruments to 

recreational equipment. These firms have strong 

ties to southern California, particularly the 

Orange County area. As air service improves, 

these businesses will be better equipped to 

access their clients, customers, suppliers, and 

other facilities. 

Local Government, Education, and 

Healthcare 

Not only will improved air service be used by 

growing tourism, financial, and high-tech industries, it will serve a broad spectrum 

of government and institutional employees as well. These sectors are growing to 

support the needs of the expanding population. In the past decade hospitals have 

spent over $120 million in new construction. The region is home to Oregon’s fastest 

growing higher education institutions, Central Oregon Community College (COCC), 

which was among the 50 fastest growing colleges in the country over the past five 

years and OSU Cascades, which grew at a rate of 54 percent over the past five 

years. COCC is just completing $42 million in campus expansion projects, and OSU 

Cascades is embarking on a $111 million campaign to become a full branch campus 

of Oregon State University. 

 

Table 2.2 Large Air Service 

Dependent Employers 

Leisure/Hospitality 

Black Butte Ranch 

JELD-WEN Development, Inc. 

Kah-Nee-Ta 

Mt. Bachelor, Inc. 

Pronghorn 

Sunriver Resort 

The Riverhouse 

Financial/Services 

Bank of the Cascades 

Clear Choice Health Plans 

Community First Bank 

High Desert Bank 

Isky 

Lifewise Healthplan 

Manufacturing/High-Tech 

Apple 

Bend Research, Inc. 

BrightWood Corporation 

Columbia Aircraft 

Manufacturing 

Contact Industries 

Deschutes Brewing 

Edge Wireless 

Facebook 

JELD-WEN Windows & Doors 

Keith Manufacturing 

Les Schwab Tire Centers 

Nanometrics 

PCC Structurals 

Woodgrain Millwork 

Healthcare/Education 

Bend Memorial Clinic 

Mt. View Hospital District 

Oregon State University 

Pioneer Memorial Hospital 

St. Charles Medical Center 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Air Service 

– Existing and Historical

6 

Air Service – Existing 

and Historical 

his section presents a record of existing and historical air service at Redmond 

Municipal Airport. The existing air service discussion highlights: service 

frequency, direct and connecting destinations, and equipment types. The 

historical air service section includes a description of historical destinations, traffic 

levels, service providers, and any extenuating factors that might have affected traffic 

in the past or that can be expected to influence service needs in the near to 

intermediate term. Redmond Municipal Airport’s past air service development 

efforts are also covered in this section. 

Existing Air Service 

Four airlines served Redmond Municipal Airport during the first half of 2012: 

Allegiant Air, Alaska Airlines, Delta Air Lines, and United Airlines (Table 3.1). 

Allegiant is suspending service in the fall. Allegiant offers twice weekly service to 

Phoenix-Mesa, AZ (seasonally) operated with MD-80 aircraft. However, Allegiant 

recently announced that effective August 2012 they will no longer serve the 

Redmond market. Alaska operates 76-seat turboprops to Portland and Seattle. Delta 

has twice daily service to Salt Lake City with the Canadair Regional Jet 200. United 

operates turboprop service to Portland, regional jets to Denver, and a combination 

of turboprops and regional jets to San Francisco. Denver, San Francisco, Seattle, and 

Salt Lake City offer good connecting opportunities; however, high load factors on 

eastbound flights have caused the market to be significantly capacity constrained. 

Table 3.1 Current Air Service 

Hub Carrier Aircraft Weekly 

Departures 

Weekly 

Seats 

Denver, CO United CRJ-200 13 650 

Phoenix-Mesa, AZ* Allegiant MD-80 2 300 

Portland, OR Alaska Dash 8 Q400 20 1,520 

United EMB-120 21 630 

Salt Lake City, UT Delta CRJ-200 14 700 

San Francisco, CA United EMB-120/CRJ-200 21 910 

Seattle, WA Alaska Dash 8 Q400 20 1,520 

Total 111 6,230 

Source: Diio Mi; Note: June 2012; * Seasonal service June-August; G4 ceasing service 

effective August 2012 

Historical Air Service 

Air service at Redmond Municipal Airport since 2008 has markedly declined. While 

the number of nonstop destinations has changed only slightly, the loss of Los 

Angeles International Airport service in 2010 was a major blow to the Airport’s 

T

This section contains: 

• Description of existing air 

service 

• Synopsis of historical air 

service 

• Description of air service 

development efforts 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Air Service 

– Existing and Historical

7 

ability to serve the needs of remote Central Oregon. Departures and seats have 

been declining since 2007/2008. 

Destinations, Service Providers, and Traffic Levels

Historically, Redmond Municipal Airport offered service to Portland, San Francisco, 

and Seattle. Little growth in air service occurred from the 1990’s through 2004. 

From 2004 through 2008, Redmond Municipal Airport’s air service improved 

significantly with service gains to Denver, Las Vegas, Los Angeles, and Salt Lake City 

(Table 3.2). Since 2008, however, the Airport has suffered several air service losses 

with Alaska Airlines pulling their Los Angeles service in 2010 and Allegiant Air 

ceasing Las Vegas service in 2012. Allegiant also reduced the Phoenix-Mesa service 

to summer seasonal service and has announced the service will be totally withdrawn 

after August 2012. At the same time many carriers reduced departures with 

significant reductions by both Alaska and United Airlines at Portland and Seattle. 

Overall, since the peak in July 2007 departures have decreased by 34 percent. Seats 

peaked year ended June 2008 and decreased 18 percent by 2012 (Exhibit 3.1). 

Table 3.2 Historical Destinations and Service Providers 

Destination Airline Annual Departures 

2004 2005 2006 2007 2008 2009 2010 2011 2012 

Denver, CO United 34 13 8 211 365 365 430 

Eugene, OR Alaska 151 364 174 55 155 

Las Vegas, NV Allegiant 89 108 106 104 102 36

Los Angeles, CA Alaska 299 720 525 365 233 

Phoenix-Mesa, AZ Allegiant 20 106 105 56 26

Portland, OR Alaska 1,911 2,012 1,833 1,814 1,606 1,040 1,044 1,041 1,044 

United 1,755 1,756 1,693 1,732 1,628 1,401 1,294 1,083 1,096 

Salt Lake City, UT Delta 632 908 815 722 687 694 699 694 

San Francisco, CA United 732 864 1,080 1,086 1,086 877 780 1,071 1,006 

Seattle, WA Alaska 1,629 1,737 1,740 1,503 1,288 1,039 1,039 1,039 1,043 

Total departures 6,027 7,001 7,738 8,136 7,165 5,887 5,813 5,456 5,470 

Total seats 205,590 248,913 295,865 356,345 359,305 339,714 349,454 321,020 312,852 

Source: Diio Mi 

Exhibit 3.1 Redmond Municipal Airport Seat/Flight Trends 

3,000

4,000

5,000

6,000

7,000

8,000

9,000

150,000

200,000

250,000

300,000

350,000

400,000

450,000

2005 2006 2007 2008 2009 2010 2011 2012

Flights

Seats

12-Months Ended

Seats Flights
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Air Service 

– Existing and Historical

8 

Extenuating Factors That Have Affected Air Service 

Several factors have affected air service at Redmond Municipal Airport. First, 

geographic location has always been a major influence. Located in Central Oregon 

on the east side of the Cascade Range, the Airport serves a vast area. With no major 

airports nearby and Portland International Airport over 140 miles away on the other 

side of the mountains, the Airport has succeeded in retaining 78 percent of its 

catchment area potential. However, the modest catchment area size has limited the 

amount of air service available to this isolated population. While Alaska seats to 

Portland and Seattle have remained relatively stable, time-of-day travel options and 

connecting opportunities have suffered as 76-seat aircraft replaced smaller aircraft. 

Another factor is the explosive economic development and population growth. 

Although this resulted in much needed air service gains from 2004 to 2008, 

improvements failed to keep pace with market demands and service losses during 

the recession result in a broad based need for improved air service. 

Past Air Service Development Efforts 

Over the last three years, the City of Redmond, Central Oregon Visitors Association, 

and Economic Development for Central Oregon have been active in air service 

development efforts (Table 3.3). Despite those efforts, air service has been 

declining with the loss of Los Angeles and Las Vegas service in the last two years 

and Phoenix-Mesa service by the end of the summer. To counter this, the 

community has been very active meeting with airlines seeking replacement nonstop 

service to one of its top markets, Los Angeles. 

Table 3.3 Past Air Service Development Efforts 

Year Initiative Result 

2009 Quarterly Performance Monitor Completed; updated on market performance 

2010 

Delta Air Lines Air Service Performance 

Analysis Results shared with Delta and issues rectified 

True Market Estimate - YE 6/30/10 

(retention/diversion study) 

Completed; 24% of catchment area 

diverting to alternate airports 

2011 United Airlines' Headquarter Meeting RDM-DEN 2 RT added seasonally in 2012 

2012 

True Market Estimate - CY 2011 

(retention/diversion study) 

Completed; 22% of catchment area 

diverting to alternate airports 

Allegiant Air Conference Completed; updated on market performance 

ACI-NA JumpStart Air Service Development 

Program (meetings with AS, DL, and UA) 

Discussed potential LAX service with carriers; 

need incentive program for headquarters 

meetings 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Air Service Needs and Deficiencies

9 

Air Service Needs and 

Deficiencies 

his remote Central Oregon community has a unique set of air service needs 

and deficiencies due to their geographic location and rapidly growing 

population. The Air Service Needs and Deficiencies section identifies the 

deficiencies in air service at Redmond Municipal Airport and what air service 

improvements are needed to correct these deficiencies. This section demonstrates 

that Central Oregon is underserved, and the average airfares in this community are 

higher than other comparable communities to one of Central Oregon’s top 

destinations, Los Angeles. 

Underserved Market 

Like most airports of its size, Redmond Municipal Airport has a number of air service 

needs. The most critical need for both business and leisure travelers in Central 

Oregon is nonstop service to southern California. From 2006 to 2010, Alaska 

Airlines provided nonstop service to Los Angeles International Airport. When Alaska 

operated nonstop Los Angeles service, Los Angeles accounted for approximately 75 

percent of the combined Los Angeles Basin origin and destination traffic or 

approximately 41,600 passengers. When nonstop service was eliminated, Los 

Angeles origin and destination passengers dropped to 40 percent of the combined 

airports or approximately 20,000 passengers. With nonstop service in the Los 

Angeles market, more than half of the traffic that previously used other Los Angeles 

Basin airports gravitated to the nonstop service. This is compelling evidence of the 

importance of nonstop service to southern California. 

Market Need/Demand for Direct 

Flights to Southern California 

Access to the southern California market 

represents a critical market for the Central 

Oregon region. As noted, much of the region's 

growth has been fueled by in-migration, and 

the leading state for in-migration is California 

(see Exhibit 4.1). 

Southern California is a leading metro area for 

in-migration from California to Central Oregon. 

As a result, there is strong demand for family, 

T

This chapter contains: 

• Description of Central 

Oregon’s air service 

needs and deficiencies 

Exhibit 4.1 Migration to Central Oregon
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Air Service Needs and Deficiencies

10 

business and leisure travel; however, this demand is somewhat elastic. Without 

nonstop service, multiple connecting flights can be logistically too complicated or 

financially too costly, and demand drops - people simply choose not to travel. A 

good example is the option of using connecting flights to southern California 

through San Francisco (SFO), an option not often used because of frequent and 

significant weather and congestion delays at that airport. 

There are also several companies in the area with close connections to parent or 

headquarter locations in southern California such as Microsemi (semiconductor 

manufacturing), Accelrys (drug discovery software), CV International (aerospace), 

Sony (gaming software) and Sunriver Resort (Oregon's largest destination tourism 

development). Additionally, a significant number of Oregon employers have strong 

business connections to southern California with major customers and suppliers. 

Other unique demand in the region is generated by a disproportionately large 

percentage of the workforce that is self-employed. Deschutes County is more than 

50 percent higher than the national average. According to the US Census (American 

Community Survey), that equates to more than 11,000 members of the workforce 

and 13,436 for the three-county region. Many of these independent contractors 

work outside the area and anecdotally it is understood that a healthy percentage 

commute (or would like to) on a weekly or monthly basis to southern California. 

Without nonstop service, these commuting patterns for professionals become 

barriers to travel. There are too many variables with connecting service due to 

weather, mechanical or other delaying issues which discourage air travel. 

Higher Than Average Airfares to Los Angeles 

The Order Soliciting Community Proposals indicated that the US DOT will compare 

the local community’s airfares to the national average airfares for all communities 

using the Bureau of Transportation Statistics (BTS) database. The BTS report for 

calendar year 2011 shows Redmond Municipal Airport with an average gross 

roundtrip fare of $352, slightly lower than the national average of $364. Allegiant 

Air’s low-fare point-to-point service and Alaska Airlines’ low-fare service to the 

north significantly reduce Redmond Municipal Airport’s average fare. 

However, Redmond Municipal Airport’s fare to one of its top five destinations, Los 

Angeles, is markedly higher than the average. For stage lengths of 1,000 miles or 

less, Redmond Municipal Airport’s fare exceeds the average by 36 percent

(source: Diio Mi calendar year 2011). When Redmond had nonstop service to Los 

Angeles, the fare was 14 percent lower between Redmond and Los Angeles. 

The most critical 

need for both 

business and leisure 

travelers in Central 

Oregon is nonstop 

service to southern 

California. 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Strategic Plan 

– Air Service

11 

Strategic Plan – 

Air Service 

he previous section, Air Service Needs and Deficiencies, identified nonstop 

southern California service as Central Oregon’s primary air service need. This 

section establishes the project goal and lays out a plan for its achievement. 

An in-depth analysis of the proposed air service is summarized in this section 

along with an alternate plan. Because Redmond Municipal Airport participated in 

two prior grant awards, a summary of those projects and how they differed from 

and compliment this application is presented at the end of this section. 

Project Goal 

The goal of Redmond Municipal Airport’s Strategic Plan is to acquire nonstop 

southern California service to adequately serve the business and leisure markets in 

Central Oregon, improve the quality of service to a top priority market, and 

continue economic development in Central Oregon. 

Proposed Air Service 

Central Oregon would best be served to southern California with nonstop service to 

Los Angeles International Airport provided by American Airlines, Delta Air Lines or 

United Airlines. American has had recent growth at Los Angeles International 

Airport and has a commitment to continuing to grow their cornerstone hubs. 

American and their codeshare partners would provide quality service between the 

two communities and would provide connecting opportunities to 67 domestic and 

international destinations. Delta and their codeshare partners offer connecting 

opportunities to 58 domestic and international destinations, and United and their 

codeshare partners offer service to 83 domestic and international destinations from 

Los Angeles International Airport. 

Detailed Market Analysis 

History speaks for itself with regard to the market analysis for nonstop southern 

California service. Southern California service is not new to Central Oregon. From 

August 2006 to August 2010, Alaska Airlines provided nonstop service between 

Redmond Municipal Airport and Los Angeles International Airport with the 76-seat 

Bombardier Q400 aircraft. 

Exhibit 5.1, next page, provides the number of onboard passengers and the 

average load factor on a 12-month ended basis for the last two years of service. 

T

This chapter contains: 

• A Strategic Plan for 

meeting Central 

Oregon’s air service 

needs and deficiencies 

• A discussion of how the 

new goal materially 

differs from Redmond 

Municipal Airport’s 

previously awarded 

projects 

• Alternate plan to meet 

the goal 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Strategic Plan 

– Air Service

12 

Onboard passengers averaged over 20,000 annually. Load factors continued to 

improve averaging over 80 percent for most of 2010.

Exhibit 5.1 Alaska Airlines’ RDM-LAX Onboard Passengers and Load 

Factor Performance 

Source: Diio Mi 

In 2010, Horizon Air, the regional operator for Alaska Airlines at Redmond 

Municipal Airport, moved to an all capacity-purchase agreement (CPA) with Alaska. 

What that meant to markets served by Horizon is a shift from Horizon conducting 

their planning efforts into new and existing markets to Alaska making those 

decisions. One of the first major shifts by Alaska was to cease north-south service 

into Los Angeles International Airport from many smaller markets. From 2010 to 

2011, many markets lost service including: Arcata, CA; Boise, ID; Flagstaff, NM; 

Redding, CA; and Reno, NV. Alaska’s current focus at Los Angeles International 

Airport is primarily international with multiple Mexico destinations. 

While the cessation of Redmond-Los Angeles service was largely due to Alaska’s 

shift in operations at Los Angeles International Airport, it left Central Oregon with a 

major deficiency in air service to the south. For year ended June 30, 2010, an 

average of 33.3 passengers daily each way or over 24,000 origin and destination 

passengers annually were destined for Los Angeles and used Alaska’s once daily, 

nonstop service. Historically proven passengers would support a 44- or 50-seat 

regional jet. Historically local traffic just to Los Angeles would be sufficient to 

support a single roundtrip to Los Angeles. The available connecting opportunities 

would further enhance demand for the service. 

Although projected passengers are robust, it is unlikely an airline will breakeven the 

first year of service due to ramp-up and service awareness. For purposes of 

estimating the shortfall, it is assumed that one daily roundtrip will be provided with 

the Embraer Regional Jet 140. For the first month of service, it is estimated that 60 

percent of the projected passengers in a mature market will be attained. It is 

estimated that the market will reach full maturity by the ninth month of service. The 

50

60

70

80

90

10,000

15,000

20,000

25,000

30,000

2009 2010

Load factor %

Onboard passengers

12-Months Ended

Onboards Load Factor

Historically proven 

passengers would 

support a 44- or 50-

seat regional jet.

Local traffic to Los 

Angeles would be 

sufficient to support a 

single roundtrip. The 

available connecting 

opportunities would 

further enhance 

demand for the 

service. 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Strategic Plan 

– Air Service

13 

ramp-up period is speculative and may differ depending on the effectiveness of the 

marketing campaign. 

To calculate the effect of the ramp-up period on net profit, Table 5.1 shows 

revenue by month with a June 2013 start date, the associated cost per month, and 

the net shortfall. Revenue was estimated based on the Redmond-Los Angeles 

average fare for calendar year 2011. With a first year estimated cost of $4.0 million, 

the service will incur an estimated shortfall of $642,261. 

Table 5.1 Service Ramp-Up/Start-Up Period 

Month 

Estimated 

O&D Pax 

RampUp %Ramp-Up 

Adj. Pax 

Load 

Factor Revenue 

ERJ-140 

Estimated 

Cost 

Net 

Surplus/ 

Shortfall 

June 2,124 60.0% 1,274 48% $189,897 $325,829 ($135,932)

July 2,348 64.4% 1,513 55% $225,484 $336,690 ($111,206)

August 2,341 68.9% 1,613 59% $240,267 $336,690 ($96,423)

September 1,866 73.3% 1,369 52% $203,934 $325,829 ($121,895)

October 2,198 77.8% 1,709 63% $254,676 $336,690 ($82,014)

November 2,225 82.2% 1,829 69% $272,584 $325,829 ($53,245)

December 2,460 86.7% 2,132 78% $317,706 $336,690 ($18,984)

January 2,180 91.1% 1,986 73% $295,967 $336,690 ($40,722)

February 2,049 95.6% 1,958 79% $291,791 $304,107 ($12,316)

March 2,347 100.0% 2,347 86% $349,703 $336,690 $13,013 

April 2,188 100.0% 2,188 83% $325,957 $325,829 $128 

May 2,376 100.0% 2,376 90% $354,024 $336,690 $17,334 

Total 26,703 N/A 22,295 69% $3,321,990 $3,964,250 ($642,261)

Source: O&D PAX = Diio Mi AS-LAX segment pax 6/30/10 + 10% add-on connect traffic; Revenue based on Diio Mi average 

RDM-LAX fare CY 2011; Note: Ramp-up = 60 percent first month increasing up to 100% in first nine months; Load factor 

capped at 90% in individual months. 

Alternate Plan 

If American, Delta or United do not provide nonstop service to Los Angeles 

International Airport by December 31, 2013, alternate carriers will be approached 

for service to a Los Angeles Basin airport including Burbank, Long Beach, Ontario, 

and Orange County or San Diego. While nonstop service to Los Angeles 

International Airport is preferred, any service to a Los Angeles Basin airport or San 

Diego will fulfill the goals of this grant application. 

Previous SCASDP Goals Successfully Achieved 

Building on the community’s previous air service successes, this project will alleviate 

the most pressing air transportation constraints facing Central Oregon. Table 5.2, 

next page, compares this application with prior SCASDP projects. This project clearly 

has different goals than the previous SCASDP grant projects. 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Strategic Plan 

– Air Service

14 

Table 5.2 SCASDP Project Comparisons 

Year Goals Plan Outcome Status 

2003 

1) Improved eastbound 

service; 2) Reduce passenger 

leakage to PDX 

Delta Air Lines’ Salt Lake 

City service 

Salt Lake City service started 

May 2005. Delta added a 

third trip without support. 

DOT-funded revenue 

guarantee not used. 

Complete / 

closed out 

2005 

1) Develop a self-help air 

service development 

program; 2) Implement the 

air service development 

program 

1) Develop an air service 

tool kit; 2) Complete a 

market analysis; 3) 

Determine a strategy for 

improving air service 

Determined Central Oregon

can sustain additional 

capacity to San Francisco. 

United Airlines upgraded 

turboprop service to 

regional jets in June 2009. 

Complete / 

closed out 

2012 Acquire nonstop service to 

southern California 

American Airlines, Delta 

Air Lines or United Airlines 

service to Los Angeles 

International Airport 

Pending Pending 

The SCASDP has produced phenomenal results for Central Oregon. The result of the 

2003 SCASDP was Delta Air Lines’ twice daily service to Salt Lake City beginning in 

March 2005. Passenger diversion decreased by 23 percent, and the overall Central 

Oregon air service market grew by 29 percent, as a result of the new service. In 

fact, Delta’s service was so successful that the revenue guarantee funds 

authorized by the grant award were not used and the money was returned 

to the US DOT. Bolstered by the results of the initial Salt Lake City service, Delta 

added a third daily roundtrip nine months later without US DOT support. 

Furthermore, the success of the Salt Lake City service served as a catalyst for new 

service to Denver. 

In a 2005 SCASDP grant award, Redmond Municipal Airport was a consortium 

member airport in the Northwest Regional Air Service Initiative (NWRASI). The 

market analysis completed as part of the NWRASI determined that Central Oregon’s 

next air service priority was more capacity to San Francisco. In June 2009, United 

Airlines upgraded Redmond-San Francisco service to 50-seat regional jets. Then in 

November 2010, United added a third regional jet roundtrip. Total capacity 

increased approximately 67 percent and was supported by the NWRASI which was 

funded partially by the SCASDP. 

The 2003 program was 

so successful that: 

- Delta added a third 

flight 10 months after 

the service started 

- No SCASDP dollars 

were used 

- It led to United 

Airlines’ Denver service 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Strategic Plan 

– Implementation and Funding

15 

Strategic Plan – 

Implementation and Funding 

here the previous section provided details and analysis associated with 

the proposed service, this section, Strategic Plan – Implementation and 

Funding, details Central Oregon’s plan for effectively addressing the 

associated risk. Organization, community involvement, risk mitigation, and a plan to 

continue the project if it is not self-sustaining after the grant expires are included. 

Public-Private Partnership 

The City of Redmond, a public entity, owner of Redmond Municipal Airport, and 

the sponsor of this application, has teamed up with Economic Development for 

Central Oregon and the Central Oregon Visitors Association to create a publicprivate partnership. Letters of support are included in Appendix B to document each 

partner’s commitment to accomplishing the Strategic Plan. These three 

organizations have a long history of working together to improve air service in 

Central Oregon. They partnered in the successful 2003 SCASDP application that 

resulted in Redmond-Salt Lake City service. 

Reference Table 6.1 each member of the public-private partnership has an active 

role in the Strategic Plan. As the grant sponsor, the City of Redmond will manage 

the grant, execute all federal grant offers, process all associated reimbursement 

requests, and submit quarterly progress updates to the US DOT. Central Oregon 

Visitors Association will develop and manage the origin and destination marketing 

program. Economic Development for Central Oregon has the responsibility for 

generating support within the Central Oregon business community through the 

commission of an Airline Travel Bank®. 

Incentive and Support Plan 

As shown in Table 5.1, page 13, it is highly unlikely that an airline will breakeven 

during the first year of service due to passenger ramp-up and service awareness. 

Considering Central Oregon’s well-documented, high demand for southern 

California service, this incentive and support plan has two primary objectives: first, 

to effectively market the service to the general public, inbound travelers, and 

business community; and second, to offset an airline’s liability during the passenger 

ramp-up period. In short, Central Oregon’s task is to market the improved service 

and cover the airline’s risk while passenger traffic builds. Exhibit 6.1, next page, 

provides a depiction of the comprehensive incentive plan Central Oregon will 

provide for nonstop southern California service. 

W

Table 6.1 Roles of Public-Private 

Partners 

Public-private 

partner Role 

Public:

City of 

Redmond 

(sponsor) 

Grant 

administration; 

Strategic Plan 

monitoring and 

performance 

tracking 

Private: 

Central Oregon

Visitors 

Association 

Develop and 

administer the 

marketing plan 

Economic 

Development 

for Central 

Oregon 

Generate support 

from Redmond’s 

business 

community; 

Coordinate the 

Airline Travel Bank® 

program 

This section contains: 

• Description of the 

public-private 

partnership 

• Designation of a legal 

sponsor 

• Funding necessary for 

implementation of the 

Strategic Plan 

• Sustainability of the 

project 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Strategic Plan 

– Implementation and Funding

16 

Exhibit 6.1 Incentive Plan

Revenue Guarantee 

An airline’s consideration of nonstop service between Redmond Municipal Airport 

and southern California depends heavily on financial support. In the current airline 

and economic environment, it has become expected that a small community share 

in an airline’s risk of service start-up. Depending on the aircraft used and frequency, 

airlines are typically requesting $500,000 to $1 million revenue guarantees. Like 

most communities, Central Oregon does not have the funds available to offer such 

a guarantee without the assistance of the US DOT through this program. 

The Redmond-Los Angeles market is a proven market with historical traffic that will 

support a 44- or 50-seat regional jet. While a revenue guarantee will be necessary 

to entice an airline to serve the market, the community is confident that it is unlikely 

the monies will be used similar to the 2003 SCASDP grant whereby Central Oregon 

was successful in getting the service and the service was so strong that the revenue 

guarantee wasn’t needed at the end of the first year of service. 

Based on preliminary estimates of the shortfall in the first year of service (Table 5.1, 

page 13) and recent information on revenue guarantees in other similar markets, it 

is anticipated that a minimum $600,000 revenue guarantee will be required. Terms 

of the revenue guarantee agreement are subject to further negotiations and 

changing industry conditions. 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Strategic Plan 

– Implementation and Funding

17 

Marketing Program 

The goal of the marketing campaign is to increase visiting, local, and business 

traveler awareness of nonstop southern California service. The Central Oregon 

Visitor Association’s $230,000 Marketing Plan targeting local and inbound travelers 

is included in Appendix A along with Economic Development for Central Oregon’s 

plan for reaching Central Oregon’s business flyers. 

MARKETING PLAN 

A complete marketing/advertising plan will be developed prior to any expenditure of 

marketing dollars. The marketing plan will be structured for a fourteen-month 

program prior to and during the first year of service. The comprehensive plan will 

focus on public awareness of the new service for both inbound (visitor) and 

outbound (local/business) markets. Emphasis will be placed on the ability of the new 

service to make air travel more convenient, less time-consuming, and less costly, 

while providing more direct access to primary destinations. Resources will also be 

allocated for the marketing of all carriers and all services for a one-year period. This 

will include other business development actions, a complete public relations 

campaign launch, research and case development, and other air service 

development activities. 

MARKETING SCHEDULE 

The program will begin 60 days prior to the initiation of service. The initial program 

will focus on the target audience, solidify travel agent interest, establish meetings to 

advise Airline Travel Bank® partners and local area businesses of service and 

schedule, and begin the print and radio advertisements. A significant share of the 

budget will be expended in the first 60 days. The total advertising and promotion 

program is planned for fourteen months. Promotion of the service will be expanded 

through the image and brand development advertising that will run throughout the 

year in print, radio and television. 

Airline Travel Bank®

To aggregate the support of the business community, change existing travel habits 

including frequent flyer loyalty programs, and reduce the airline’s breakeven period, 

Economic Development for Central Oregon will commit to the creation of a 

$350,000 Airline Travel Bank®. This commitment level is made based on 

experience. In 2004 Economic Development for Central Oregon successfully 

solicited commitments and received funds from 112 local businesses totaling 

$626,000 to support Delta Air Lines Redmond-Salt Lake City service. Sixty-nine 

percent of Airline Travel Bank® funds were used by Airline Travel Bank® partners in 

the first 90 days of Delta’s service. This high “burn rate” of funds contributed 

directly to the exceptionally high load factors and the early success of the service. 

The superior performance prompted Delta to add a third flight with no requirement 

The marketing plan 

will be structured for a 

fourteen-month 

program prior to and 

during the first year of 

service. 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Strategic Plan 

– Implementation and Funding

18 

for an additional revenue guarantee. At the end of the first year of service, revenue 

guarantee funds were not needed in large part due to the success of the Airline 

Travel Bank® program, and the 2003 SCASDP funds were returned unused to the 

US DOT. 

An Airline Travel Bank® is a money-in-the-bank financial commitment of a business 

community to support a specific air service initiative for a specified period. Unlike 

subsidies or pledges that do not guarantee that new service initiatives will be used 

by the flying public, the Airline Travel Bank® guarantees that travelers will use a 

specific air service offering by securing a “use-it-or-lose-it” financial commitment. 

The strength of the Airline Travel Bank® concept is the broad-based financial 

commitment of the business community. It is a simple, logical program that 

communities and airlines seem to like. Exhibit 6.2 provides a depiction of the 

Airline Travel Bank® process. 

Similar to the 2004 program, Economic Development for Central Oregon will use 

Mead & Hunt’s proven Airline Travel Bank® program. Over the last 10 years, Mead 

& Hunt has implemented multiple successful programs including the PensacolaAtlanta AirTran Airways program that finished with $2.1 million and 219 

participating companies. The Eugene, OR business community has supported three 

Airline Travel Bank® programs in recruiting service to Los Angeles, Phoenix, and Salt 

Lake City. These are just some of the examples of the successful programs using this 

method. This is not a pledge program, an Airline Travel Bank® locks in the 

community financial commitment that pledges lack. 

Exhibit 6.2 Airline Travel Bank® Process 

Fee Waivers 

The incentive program includes a landing fee waiver for the first 12 months of 

service. The fee waiver will vary depending on the type of aircraft used and the 

frequency of service. The fee waiver is estimated to be a minimum of $40,000. 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Strategic Plan 

– Implementation and Funding

19 

Strategic Plan Funding 

The City of Redmond is seeking $500,000 in US DOT funding as part of a support 

program associated with nonstop southern California service. SCASDP grant funds 

will be used for a revenue guarantee. Central Oregon’s public-private partnership 

will fund a $230,000 marketing program and provide in-kind services associated 

with an Airline Travel Bank®, landing fee waivers, and grant administration. Table 

6.2 provides the Strategic Plan budget broken down by element and sources 

of funding. The community will fund 60 percent of the total program. Nonairport funding sources will provide 36 percent of the cash requirement and 54 

percent of the funding for the total program including in-kind services. 

Table 6.2 Strategic Plan Budget 

Description 

Funding Source 

Total 

US DOT Airport Non-Airport 

Cash Cash In-Kind Cash In-Kind 

Airline Incentive Program:

 Revenue Guarantee $500,000 $100,000 $600,000

 Marketing Campaign $25,000 $200,000 $5,000 $230,000

 Airline Travel Bank $350,000 $350,000

 Landing Fee Waiver $40,000 $40,000

Implementation/Monitoring Program:

 Staffing $5,000 $10,000 $15,000

Total $500,000 $25,000 $45,000 $300,000 $365,000 $1,235,000

Percent of Total Project 40% 2% 4% 24% 30% 100%

Percent of Cash Contribution 61% 3% N/A 36% N/A 100%

Project Continuation and Sustainability 

The preliminary analysis indicates that after the ramp-up period, daily jet service to 

Los Angeles International Airport will be profitable (i.e. self-sustaining). However, a 

continued rise in fuel costs or any number of factors could result in fewer passenger 

or less ticket revenue than anticipated. During the course of the project, the City of 

Redmond will track the performance of the service, and, if at the end of the first 

nine months of regional jet service it is not meeting expectations, the partners will 

evaluate the program and draw up a plan that targets the shortcomings. At a 

minimum, Central Oregon Visitors Association and the Redmond Municipal Airport 

will commit an additional $50,000 and $25,000, respectively, for continued 

marketing. Depending on the specifics at the time, the public-private partners will 

consider other appropriate support mechanisms. In addition, an additional six 

months of landing fee waivers will be considered as part of the sustainability 

initiative following the one-year anniversary of service.
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Schedule and Monitoring

20 

Schedule and 

Monitoring 

 realistic timetable has been developed to achieve the goals of this SCASDP 

application. This section provides critical milestones to be achieved by the 

public-private partnership, including target dates for: the marketing 

campaign development and initiation; the Airline Travel Bank® program 

implementation; nonstop southern California service start-up; alternate plan; and 

revenue guarantee contract completion. A monitoring program is also provided to 

track the progress of the project. 

Strategic Plan Schedule and Milestones 

The following target dates are proposed to track the progress of this air 

service initiative: 

Table 7.1 Strategic Plan Schedule

Date Action Item Description

October 2012 

- January 

2013 

Airline 

meetings/negotiations 

After grant award, Redmond Municipal 

Airport will meet with American Airlines, 

Delta Air Lines, and United Airlines at their 

headquarters to discuss nonstop Los 

Angeles service. Upon airline interest, the 

terms of the airline incentive package will 

be negotiated. 

FebruaryMarch 2013 

Marketing campaign 

development 

Development of the marketing campaign will 

be completed in February/March 2013 in 

order to begin the marketing campaign 60 

days prior to new service initiation. 

March – May 

2013 

Airline Travel Bank® 

The Airline Travel Bank® program takes 

approximately 12 weeks from initiation to 

contract completion and will be kicked off in 

March 2013. 

April 2013 Marketing initiation 

It is anticipated that the marketing campaign 

will begin by April 2013 and continue 

throughout the first year of nonstop southern 

California service. 

June 2013 

Nonstop southern 

California service 

The service start date is the critical date for 

the rest of the Strategic Plan. It is anticipated 

that, with successful airline negotiations, 

service would start in June 2013. Service startup is dependent on airline route planning and 

aircraft availability for the Redmond/Bend 

market. 

A

This section contains: 

• The schedule for timely 

completion of the 

project 

• How the community 

will monitor the 

progress of the project 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Schedule and Monitoring

21 

Table 7.1 Strategic Plan Schedule

Date Action Item Description

December 

2013 

Alternate plan 

If American, Delta, or United has not 

implemented nonstop Los Angeles service by 

December 31, 2013, the City of Redmond will 

contact other potential carriers to provide 

service to southern California which would 

meet the goals of this grant application. 

May 

2014 

Revenue guarantee 

contract completion 

At the end of the first year of nonstop service, 

with a service start date of June 2013, the 

revenue guarantee will be calculated. If the 

service start date changes due to airline 

circumstances and/or equipment availability, 

the revenue guarantee contract term will 

change accordingly. 

Strategic Plan Monitoring Program 

The monitoring program includes: service performance tracking; assessing the 

effectiveness of the marketing campaign; impact on airfares; and determining the 

influence of nonstop southern California service on retention at the Airport. Table 

7.2 provides the action items and frequency to monitor the Strategic Plan. 

Table 7.2 Strategic Plan Monitoring 

Frequency Action Item Description

Monthly 

Airfares 

Track walk-up, business, and leisure 

published fares for top 25 markets to 

ensure fares are competitive with 

competing airports (i.e. Portland and 

Eugene). Fare issues will be 

communicated to incumbent airlines. 

Airline performance Load factors by flight, enplanements, 

flight cancellations 

Market performance Passenger ramp-up

Revenue guarantee indicators Ticket revenue, cost, drawdown

3 months/ 

6 months 

Marketing 

Complete a phone survey to assess the 

effectiveness of the marketing 

program in the Central Oregon 

community and adjust as necessary. 

9 months Program assessment 

Complete an overall assessment of the 

program to determine if additional 

community support is needed beyond 

one year. 

12 months True Market Estimate 

Complete a true market estimate to 

evaluate the use of Redmond 

Municipal Airport by local travelers 

compared to their use of Portland and 

Eugene. Analyze output and 

communicate with airline. 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Appendix A

22 

Appendix A. 

Marketing Plan 

he Central Oregon Visitors Association (COVA) has served as the Destination 

Marketing Organization for Central Oregon since 1971. COVA will commit to 

manage and fund a $225,000 marketing program to increase awareness of 

Central Oregon in Los Angeles and key connecting markets. However, COVA 

expects to fund this marketing program at a much higher level and that there will 

be substantial in-kind contributions from media outlets. COVA will also manage a 

$25,000 local campaign, funded by Redmond Municipal Airport, to increase Central 

Oregon’s awareness of the Los Angeles service. 

Economic Development for Central Oregon (EDCO) is a private non-profit 

organization dedicated to building a vibrant and thriving regional economy by 

attracting new investment and jobs. EDCO will take on the responsibility of 

marketing improved service to the Central Oregon business community. EDCO has a 

wide network of business contacts locally by which to market new air service 

opportunities. Rather than using a media based advertising campaign, EDCO will 

leverage its contacts to inform business owners and key decision makers in the 

private sector about nonstop Los Angeles service. 

Target Audience 

The target audience for the Los Angeles air service initiative includes: 

• Destination visitors with the discretionary income and propensity for 

multiple-night stays 

• Spend $1,500 plus on travel annually 

• Household income of $100,000 or more, between the ages of 28 to 65 

• Primary emphasis in Western state markets of California and Oregon 

• Secondary emphasis on one-stop airline markets over Los Angeles; 

specifically the Pacific Rim and Oceania 

Air Service Support Program – Los Angeles 

COVA’s marketing efforts will center around seven distinct and mutually 

cooperative programs designed to provide a region-wide, cohesive marketing, 

promotion, and sales plan. 

1. Destination image advertising 

2. Cooperative advertising with private sector 

3. Public relations and promotional programs 

4. Special event product development 

T
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Appendix A

23 

5. Official Visitor Information Center 

6. Reservations center operations and inquiry fulfillment 

7. Tourism industry representation and research 

Destination Image Advertising 

Image advertising develops and supports the brand awareness of 

Central Oregon as an outdoor recreation destination and COVA’s 

objectives. Broadcast, cable, print and digital media are all components 

of COVA’s development of the Central Oregon brand. The added 

value and paid web advertising includes banner ads, 

page placement, email blasts, and direct mail/web-generated inquiries 

from partner host sites. In addition, paid advertising and promotional 

messaging via social media will be a component of the strategy via 

Facebook, Twitter, YouTube, Google+, etc. 

COVA image advertising can be seen in multiple publications and 

more than a dozen West Coast newspapers and seasonal television 

spots throughout the Pacific Northwest and select target markets. 

COVA’s advertising In support of the Los Angeles service is expected to 

run in the outlets shown in Table A.1. Local and distant outlets are 

separated, and a projected budget and in-kind value for each outlet is 

shown. The local advertising production and circulation costs will be 

paid by Airport funds. Advertising placed in Los Angeles and select 

connecting markets will be funded by COVA. 

Cooperative Advertising With Private Sector 

Cooperative advertising leverages the Central Oregon destination 

brand message with a call-to-action partnership between COVA and 

marketing partners who share in the financial investment and message 

representation in targeted advertising campaigns. Table A.2 lists 

partnership marketing programs that will include placements to benefit 

the air service campaign. Most cooperative efforts leverage the COVA 

investment with at least a dollar for dollar match. 

Public Relations and Promotional Programs 

COVA staff and member representatives regularly participate in sales 

missions in target market areas designed to educate and inform the 

travel industry partners and media on Central Oregon as a destination. 

These missions are often scheduled in coordination with editorial 

calendars and/or tradeshow missions to leverage travel resources. The 

trade shows that COVA is planning on attending are shown in 

Table A.3. 

Table A.1 Image Advertising 

Media Outlet Projected 

Cost 

Projected 

In-Kind 

Local media outlets 

1859 – Oregon’s Magazine $10,000 $20,000 

Central Oregon Magazine $5,000 $30,000 

KTVZ Channel 21 $7,500 $0 

Fox KOHD $7,500 $0 

Combined Comm. $2,500 $0 

Horizon Broadcasting $2,500 $0 

Cascade Business News $2,500 $0 

The Bulletin $7,500 $0 

Target market media outlets 

AAA Tour Book $18,900 $5,000 

Golf Digest - West Region $80,544 $47,500 

Golf Digest Index $57,000 $93,000 

Golf World $35,650 $0 

Angeleno magazine $79,000 $30,000 

Sunset Summer Trips $0 $50,000 

LA Media/Sales blitz $15,000 $0 

Destinations Guide, 

Travel Oregon $37,500 $68,000 

Comcast SportsNet $450,000 $0 

Meetings West/

Smart Meetings $15,139 $13,000 

The Travel Channel 

International $37,000 $155,000 

The Travel Channel web 

video links $0 $50,000 

Table A.2 Cooperative Marketing Partners 

Partner 

Mt. Bachelor 

Sunriver Alliance 

Sisters Country 

AAA Tour Book for OR and WA 

Travel Oregon 

Oregon Golf Directory 

Multiple radio and television stations 

Table A.3 Trade Shows and Sales 

Trade Show Projected

Cost 

Projected 

In-Kind 

HSMAI Long Beach $3,500 $3,500 

MPI Cascadia 

Conference $3,000 $3,000 

JATA - Japan $3,500 $3,500 

WTM - United 

Kingdom $6,000 $6,000 

ITB - Germany $6,000 $6,000 

Pow Wow - US $5,000 $2,500 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Appendix A

24 

On a year-round basis, COVA hosts familiarization trips to the region inviting 

qualified feature travel writers, tour operators, travel agents, and meeting planners 

to Central Oregon to acquaint them with Central Oregon’s unique and exceptional 

year-round vacation product. 

Special Event Marketing and Development 

COVA has partnered with the community to identify, develop, and support headline 

events to strengthen Central Oregon as a destination in non-peak periods. COVA’s 

direct promotions have supported signature events including, but not limited to, the 

Golf World Pacific Amateur Golf Classic, USA Cycling Nationals, PGA Professionals 

Championship, the Komen Marathon for a Cause, the Pacific Crest Sports Festival, 

the Sunriver & Cascade Music Festivals, BendFilm, Bend’s Summer, Fall and Winter 

Festivals, The Rally and FMCA motorcoach events at the Expo Center, and the 

Sisters Quilt Show. These events will be leveraged in support of air service. 

Visitor Information and Inquiry Fulfillment 

COVA produces the award-winning, 78-page, magazine-quality, Official Central 

Oregon Visitors Guide. The COVA Visitors Guide is the primary response piece to all 

inquiries received in response to our advertising and promotion campaign. The 

Visitors Guide is distributed to travel agents and tour operators across the nation 

and internationally, placed in over 4,000 guest rooms, available at all nine Oregon 

State Welcome Centers, and distributed as part of press kits. The Visitors Guide will 

have advertisement space dedicated to the Los Angeles service. 

Official Visitor Information and Reservations Center 

To personally facilitate visitor inquiries and vacation planning, COVA operates the 

region’s Official Visitor Information Center (VIC) seven days a week. The VIC serves 

a walk-in clientele averaging 3,100 plus visitors per month. In addition, the COVA 

Reservations Center provides services to more than 500,000 annual inquiries via 

telephone, mail, and Web Site User Sessions. The Client Service Representatives 

focus air traveler attention to the services available at Redmond Municipal Airport. 

Tourism Industry Representation and Research 

COVA is recognized as the regional tourism industry liaison for the tri-county area. 

This role requires COVA’s active involvement on numerous boards, commissions, 

committees, and industry-related organizations on a local, statewide, and national 

level. This participation enables COVA to disseminate information, trends, statistics, 

and opportunities to local partners and media contacts made possible through 

research partnerships with travel and tourism industry partners at the highest levels. 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Appendix A

25 

Marketing to Central Oregon’s Business Community 

Business travelers are extremely important to airlines. In general, business travelers 

make up 40 percent of air travelers; however, these travelers generate 70 percent of 

airline revenue. EDCO will market reinstated, nonstop Los Angeles service to this 

group. EDCO’s efforts will focus on three distribution methods: EDCO’s monthly 

newsletter, direct marketing, and presentations to civic groups. 

Target Audience 

EDCO’s target audience for the Los Angeles air service initiative includes: business 

travel decision makers; travel agents; and businesses which contributed to the 

Airline Travel Bank® in support of the Delta Air Lines’ service 

Newsletter 

The eCon Update, EDCO's monthly newsletter, not only provides the latest 

information from around the region, but also explores employment trends for 

Central Oregon, introduces the community's newest businesses, and presents 

EDCO's marketing efforts. EDCO distributes this newsletter to over 1,400 people 

across hundreds of businesses. The newsletter will make specific mention of new, 

nonstop Los Angeles service at Redmond Municipal Airport. 

 

Direct Marketing 

In 2005, 120 businesses contributed over $600,000 to the Airline Travel Bank®

effort which supported Delta service in its infancy. EDCO will contact these 

businesses again and notify them of the nonstop Los Angeles service. These 

businesses are key Redmond Municipal Airport users and have a history of 

supporting new air service initiatives. EDCO 

will contact this group via e-mail, phone call, 

or personal meeting. 

Presentations 

Local organizations’ meetings will provide a 

perfect venue to educate local business 

leaders about the Los Angeles service. A list of 

civic organizations and business groups where 

EDCO will present information is provided in 

Table A.4. The members of these local 

organizations understand the impact 

economic development has on their 

community and, by extension, the importance 

of local air service. 

Table A.4 Central Oregon Civic 

Clubs and Business Groups 

Organization 

Rotary Club 

Redmond Executive Association 

Opportunity Knocks 

Central Oregon Association of 

Realtors 

Commercial Investment Division 

High Desert Enterprise Consortium 

Vistage 

Bend Chamber of Commerce 

Redmond Chamber of Commerce 

Prineville Chamber of Commerce 

Jefferson County Chamber of 

Commerce 

Sisters Chamber of Commerce 

La Pine Chamber of Commerce 

Crooked River Ranch Chamber of 

Commerce 
Application Under the Small Community Air Service Development Program 

 City of Redmond/Redmond Municipal Airport Appendix B

26 

Appendix B. 

Community Support 

ppendix B includes letters of support for the City of Redmond’s 

application to the US Department of Transportation for nonstop 

southern California service. Support letters were submitted by 

participants in the public-private partnership and members of the Central Oregon 

community. The letters of support are included on the following pages of this 

Appendix B. 

Government 

Congress of the United States, Congressman Greg Walden 

Oregon State House of Representatives, Representative Gene Whisnant 

Oregon State House of Representatives, Representative John E. Huffman 

Oregon State Senate, Senator Chris Telfer 

Oregon State Senate, Senator Lee Beyer 

Oregon State Senate, Senator Ted Ferrioli 

State of Oregon, Governor John A. Kitzhaber, MD 

Deschutes County Board of County Commissioners, Commissioner Anthony DeBone 

and Commissioner Tammy Baney 

City of Redmond, Mayor George Endicott and City Manager David Brandt 

Public-Private Partnership 

City of Redmond/Redmond Municipal Airport (see cover letter) 

Central Oregon Visitors Association 

Economic Development for Central Oregon 

Businesses and Organizations 

Bend Chamber of Commerce 

Deschutes County Fairgrounds and Expo Center 

Maupin Area Chamber of Commerce 

Northview Oregon Resorts 

Redmond Chamber of Commerce and CVB 

Redmond Executive Association 

Seventh Mountain Resort 

Sisters Area Chamber of Commerce 

The Well Traveled Fork, LLC 

William Smith Properties, Inc. 

A



CHRIS TELFER

STATE SENATOR

DISTRICT 27

OREGON STATE SENATE

900 couRT sr. NE s-423

SALEM, OR 97301

May 31 ,2012

Aloha Ley

Associate Director, Small Community Program

Office of Aviation Analysis

US Department of Transportation

1200 New Jersey Ave, SE W86-310

Washington, DC 20590

Subject: Small Community Air Service Development Program Grant Application

Docket DOT-OST-2O1 2-0069

City of Redmond, OR - Redmond MunicipalAirport

Dear Ms. Ley:

As the Oregon State Senator from District 27, I would greatly appreciate your careful

consideration of the City of Redmond's application for Small Community Air Service Development

Program grant funds. The proposed plan provides financial assistance to support improved

service to Central Oregon, the fastest growing region in Oregon. The proposed southern

California service will benefit multiple, remote Central Oregon communities and have far reaching

benefits.

A successful grant application will result in significant improvements for the traveling public,

including businesses, educational institutions and other enterprises whose access to the national

air transportation system is limited. Given the City of Redmond's outstanding record of success

with air service development, which has strategically utilized previous federal grants and

incorporated solid private and public partnerships, I encourage the US Department of

Transportation's consideration and support for such a worthwhile project.

The Small Community Air Service Development Program is greatly appreciated. lmproving air

service in Oregon is a priority of my office. Accordingly, the subject grant application has my full

support. Please do not hesitate to contact my office if we can be of assistance in this matter.

Sincerely,

Cr;.Te4-

Chris Telfer

Senator District 27

Phone: (503) 986-1727 - Email: sen.christelfer@stâte.or.us




Board of Coun Commissioners 


1300 NW Wall St, Suite 200 • Bend, OR 97701-1960 

(541 J 388-6570· Fax (541 J 385-3202 

www.co.deschutes.or.us 

May 30,2012 board@co.deschutes.or.us 

Tammy Baney 

Anthony DeBone 

Alan Unger Aloha Ley 

Associate Director, Small Community Program 

Office of Aviation Analysis 

US Department of Transportation 

1200 New Jersey Ave, SE W86-310 

Washington, DC 20590 

Subject: 	Small Community Air Service Development Program 

Docket DOT -OST-2012-0069 

City of Redmond, OR - Redmond MuniCipal Airport 

Dear Ms. Ley: 

It is with great pleasure that the Deschutes County Board of Commissioners submits this letter of strong 

support for the air service proposal detailed in the City of Redmond's Small Community Air Service 

Development Program grant application. Businesses in Central Oregon depend on nonstop service to 

southern California. 

As our community continues to grow and more visitors are drawn to this unique region, our limited 

transportation options will be further strained unless service is expanded at Redmond Municipal Airport. 

As you evaluate the merits of this application, I encourage you to consider how critically important air 

service is to Central Oregon. 

The Central Oregon region has been hit hard by the recent recession, with unemployment continuing to 

hover between 13-15%. With high speed internet we have the opportunity to support a number of careers 

remotely from our region. The Airport is a vital partner to our economic advancement in Central Oregon, 

growth in air service is an important component in this equation. We are pleased to have the opportunity 

to support this grant application. 

Sincerely, 

Commissioner Anthony DeBone 

com~Y 

Enhancing the Lives of Citizens by Delivering Quality Services in a Cost-Effective Manner 
716 SW Evergreen Ave 

Redmond, OR 97756-0100 

 CITY OF REDMOND 

(541) 923-7710

Fax: (541) 548-0706 

info@ci.redmond.or.us 

www.ci.redmond.or.us

Aloha Ley 

Associate Director, Small Community Program 

Office of Aviation Analysis 

US Department of Transportation 

1200 New Jersey Ave, SE W86-310 

Washington, DC 20590 

Subject: Small Community Air Service Development Program 

 Docket DOT-OST-2012-0069 

 City of Redmond, OR - Redmond Municipal Airport 

Dear Ms. Ley: May 24, 2012 

We strongly support the air service proposal detailed in the City of Redmond’s Small Community Air 

Service Development Program grant application to obtain nonstop service to southern California. Like 

many businesses in Central Oregon, our agency depends on access to air service to continue to prosper. 

Growth in Central Oregon over the past few years has been fueled by the presence of the Redmond 

Municipal Airport. As you evaluate the merits of this application, we encourage you to consider how 

critically important air service is to Central Oregon. As our community continues to grow and more visitors 

are drawn to this unique region, our limited transportation options will be further strained unless service is 

expanded at Redmond Municipal Airport. 

The Airport has forged strong ties with the business community to attract better air service. We 

appreciate the opportunity to expand that partnership to include the US Department of Transportation 

through the Small Community Air Service Development Program. We are pleased to have the opportunity 

to support this grant application. 

Sincerely, 

George Endicott David Brandt 

Mayor City Manager 

City of Redmond City of Redmond 
May 31, 2012 

Aloha Ley 

Associate Director, Small Community Program 

Office of Aviation Analysis 

US Department of Transportation 

1200 New Jersey Ave, SE W86-310 

Washington, DC 20590 

Subject: Small Community Air Service Development Program 

 Docket DOT-OST-2012-0069 

 City of Redmond, OR - Redmond Municipal Airport 

Dear Ms. Ley: 

On behalf of our 500+ member businesses, the Central Oregon Visitors Association (COVA) is privileged to 

submit this letter of support for the Redmond Municipal Airport grant application for US Department of 

Transportation funding. COVA has been the non-profit, tourism destination marketing and promotion agency 

for Central Oregon for more than 40 years. In that time, the population of Central Oregon has multiplied sixfold and tourism has developed into the single largest industry in the region, generating in excess of one-half 

billion dollars annually. 

Commercial air service plays a vital role in our ability to position Central Oregon as a competitive, yearround destination. In partnership with Economic Development for Central Oregon (EDCO) and the Redmond 

Municipal Airport, COVA fully supports the proposed plan for nonstop air service to southern California. 

COVA will commit our expertise and resources toward developing and implementing the marketing strategy 

and media plan to support this air service. Not only will our organization commit $200,000 of COVA’s 

resources to a marketing, media, and public relations campaign geared toward inbound travel, but we will 

manage and execute a $25,000 local campaign, directed at residents, to support outbound travel. COVA 

clearly recognizes the importance of commercial air service to the economy of the region through access for 

visitors and to support area businesses, organizations, and institutions. 

Nonstop southern California service will play a visible and integral role in all aspects of our destination 

marketing. 

Thank you for your consideration and the opportunity to lend strong support to this request. 

Sincerely, 

Alana Hughson 

President & CEO 
________________________________________________________________________________________________ 

EDCO ▪ 109 NW Greenwood Avenue, Suite 102 ▪ Bend, OR 97701 ▪ 800-342-4135 ▪ www.edcoinfo.com

May 31, 2012 

Aloha Ley 

Associate Director, Small Community Program 

Office of Aviation Analysis 

US Department of Transportation 

1200 New Jersey Ave, SE W86-310 

Washington, DC 20590 

Subject: Small Community Air Service Development Program 

 Docket DOT-OST-2012-0069 

 City of Redmond, OR - Redmond Municipal Airport 

Dear Ms. Ley: 

On behalf of Economic Development for Central Oregon (EDCO), I am excited to support 

the grant application for U.S. DOT funding for the Redmond Municipal Airport. EDCO 

has been the lead organization for economic and industry development in the tri-county 

region for more than three decades. Over the past ten years we’ve helped establish new 

industries, grown our existing manufacturing and technology sectors and launched efforts to 

be a top location in the country for new ventures. Our efforts have led to the creation of 

more than 3,400 new, traded-sector jobs and $1 billion in private capital investment. 

Given our geographic isolation from other metros in the western U.S. and the fact that no 

interstate connects Central Oregon to the rest of the country, commercial air services plays a 

disproportionately important role for our economy. Our traded-sector companies rely 

heavily on scheduled air service to connect with customers, suppliers, strategic partners and 

headquarter or satellite operations. Our longstanding partnership with the Central Oregon 

Visitor’s Association (COVA), area Chambers of Commerce and the Redmond Municipal 

Airport and other members of COAST (Central Oregon Air Service Team) fully endorses 

the proposed plan for nonstop air service to southern California. The team will also actively 

help its success – before, during and following its launch. 
________________________________________________________________________________________________ 

EDCO ▪ 109 NW Greenwood Avenue, Suite 102 ▪ Bend, OR 97701 ▪ 800-342-4135 ▪ www.edcoinfo.com

EDCO is committed to helping raise matching funds outlined in the grant application for 

revenue guarantee ($100,000) and a $350,000 Airline Travel Bank (ATB). We have 

experience in raising hard dollars from local companies in the form of prepaid travel that 

drives use of the new service and consequently, profitability for the airline. In our last ATB 

effort to attract the region’s first non-stop eastbound service, we were able to raise more 

than $620,000 from 120 companies in a three week timeframe. These were actual dollars 

deposited, not pledges. We believe that this effort was a critical factor in the service being 

profitable in the first month of operation, which provided the opportunity to return the 

Redmond Municipal Airport was able to return its last $500,000 DOT EAS grant so it could 

be used elsewhere. 

For many years, non-stop service to southern California has been our top priority for new 

flights to and from Central Oregon. We believe this service will be successful, sustainable 

and will play an important role in our efforts to grow and diversify the regional economy. It 

could also be a pivotal effort to reverse recent trends that have resulted in an overall 

reduction in our air service options and available seats. 

On behalf of our entire team and Board of Directors, thank you for your consideration and 

the opportunity to express our strong support to this grant request. 

Sincerely, 

Roger J. Lee 

Executive Director 


The Maupin Area Chamber of Commerce and It’s businesses support the Redmond s Airport 

grant application for a Small Community Air Service Development Program Grant. We believe 

this airport is invaluable to our rural community and any grant or funds that would improve it, is 

worthy of our support.

Thank you to the Redmond Chamber, EDCO and COVA for working so hard to get the word out 

there and to gather community support. Without you, we may have missed this opportunity to 

support such a valuable endeavor.

Sincerely,

Cristie Amaral

Maupin Area chamber of Commerce

cristiea@maupinoregon.com

P.O. Box 220

Maupin, OR 97037

541-993-1708

May 31, 2012 

Aloha Ley 

Associate Director, Small Community Program 

Office of Aviation Analysis 

US Department of Transportation 

1200 New Jersey Ave, SE W86-310 

Washington, DC 20590 

Subject: Small Community Air Service Development Program 

 Docket DOT-OST-2012-0069 

 City of Redmond, OR - Redmond Municipal Airport 

Dear Ms. Ley: 

The Redmond Chamber of Commerce & CVB would like to offer its strongest support for the air service 

proposal detailed in the City of Redmond’s Small Community Air Service Development Program grant 

application to obtain nonstop service to southern California. With over 720 members, our member 

businesses depend on access to air service. 

The Redmond Municipal Airport is one of Central Oregon’s leading economic engines and plays a crucial 

role in the regions growth. As you evaluate the merits of this application, I encourage you to consider how 

critically important air service is to Central Oregon. As our community continues to grow and more visitors 

are drawn to this unique region, our limited transportation options will be further strained unless service is 

expanded at Redmond Municipal Airport. 

The Airport has built strong ties with the business community to attract better air service. We appreciate 

the opportunity to expand that partnership to include the US Department of Transportation through the 

Small Community Air Service Development Program. We are pleased to have the opportunity to support 

this grant application. 

Sincerely, 

The Redmond Chamber of Commerce & CVB 

Eric Sande 

Executive Director