Proposal to Provide Essential Air Service at 

Gulkana, May Creek, and McCarthy, Alaska 

Docket DOT =OST -1995-492 

Rate Period Feb 1, 2013 to Jan 31, 2015 

August 10, 2012 

Todd Homan 

US Department of Transportation 

Essential Air Service & Domestic Analysis Div, X-53 

1200 New Jersey Avenue, SE 8th Floor Room W86-472 

Washington DC 20590 

Dear Mr. Homan 

;· .. .) 

... J.:J 

Enclosed please find our proposal for continuation of essential air service for Gulkana, 

McCarthy, May Creek, Alaska. Our attached bid is for the standard two year contract. 

Service proposal February 1, 2013 through January 31,2015 

We would like to propose the same historical level of service for a four-year rate term if 

possible, with provisions for a rate change for fuel, oil and insurance after two years. 

Sincerely, 

t).~AKP~ Dave Parmenter 

Director of Operations 

Copper Valley Air Service 

1 
Proposal to Provide Essential Air Service at 

Gulkana, May Creek, and McCarthy, Alaska 

Docket DOT=OST-1995-492 

Rate Period Feb 1, 2013 to Jan 31, 2015 

U.S. Dept. of Transportation Office of the Secretary Washington D.C. 

Copper Valley Air Service 

Annual Subsidy for Anchorage, Gulkana, McCarthy and May Creek 

February 1, 2013 to January 31,2015 

From Anchorage International Airport two (2) times per week with fuiiiFR Piper PA-31 

Twin engine aircraft with six (6) passenger seats. Year-round service. 

Copper Valley Air Service would reserve the option to use a Cessna 441 Conquest twin 

Prop-Jet nine (9) passenger seats for aircraft backup, or to meet greater than six 

passenger seat demand if needed to Gulkana Alaska. 

From Gulkana to McCarthy and May Creek Alaska, two (2) times per week scheduled 

service for 52 weeks per year. Proposed service with Cessna 185 wheel ski equipped, 

three (3) passenger aircraft, winter months, Cessna 206 four (4) passenger aircraft for 

summer months. 

Copper Valley Air Service would reserve the option to use a DHC-2 Beaver six (6) 

passenger seats for aircraft backup or to meet greater than four passenger seats 

demand if needed to McCarthy and May Creek in winter or summer months. 

Routing: Monday and Thursdays 

Depart -ANC 8:30am 

Depart -GKN 10:00 am 

Depart -MXY 11 : 15 am 

Depart- MYK 11 :30 am 

Depart -GKN 12:45 pm 

ARV- GKN 9:45 am 

ARV -MXY 10:55 am 

ARV- MYK 11 :25 am 

ARV-GKN 12:30 pm 

ARV- ANC 2:00 pm 

2 
Proposal to Provide Essential Air Service at 

Gulkana, May Creek, and McCarthy, Alaska 

Docket DOT=OST-1995-492 

Rate Period Feb 1, 2013 to Jan 31, 2015 

August 10, 2012 

United States of America 

Department of Transportation 

Office of Secretary 

Washington, DC 

Copper Valley Air Service 

Service Proposal February 1, 2013 to January 31, 2015 

Copper Valley Air Service would operate over a GKN- MXY- MYK- GKN, 

ANC - GKN routing with a change of guage at GKN. 

The carrier would provide two round trips a week year-round between GKN and ANC 

with Piper PA-31 aircraft for an annual subsidy need of $269,189 and two round trips a 

week year-round from GKN- MXY and MYK with either Cessna 185 or 206 aircraft for 

an annual subsidy of $206,198. 

Copper Valley Air Service 

P.O. Box 234 

Glennallen AK 99588 

Phone 907-822-4200 

e-mail cvas@coppervalleyak.net 

Fax: 907-822-4204 

3 
Proposal to Provide Essential Air Service at 

Gulkana, May Creek, and McCarthy, Alaska 

Docket DOT=OST -1995-492 

Rate Period Feb 1, 2013 to Jan 31, 2015 

Work Sheet 

Projection 

ANC toGKN 

Aircraft Type: Piper PA-31-350 

Block Hours: Copper Valley Air Service wet leases a Piper PA-31-350 from Security 

Aviation at a cost of $2,500 per trip. 

Direct Expense 

Indirect Expense 

$260,000 

$ 45,917 

Lease of Hanger Space five winter months@ $4,900 per month with Y2 use= $12,250 

Ground handling, Aircraft and Passengers '!4 = payroll one person = $ 12,480 

Commissions Counted in MXY -MYK Projection 

Advertising Counted in MXY -MYK Projection 

Management I Security= 

Office and Reservations 12 months $37,043 1/3 total= 

Anchorage and Gulkana 

Totallndirects 

Total Directs 

Total Operating Cost 

Return (5% of oper. Exp) 

Total Economic Cost 

Operating Revenues 

Passenger Revenues 258 Passengers@ $195.00 

Mail Revenues U.S. Post Office will not tender mail to this Market 

Freight 2,2851bs@ .75 

Total Revenues 

Economic Cost 

Total Revenues 

$321,212 

$ 52,023 

Total Subsidy.Need@ 100% $269,189 

$ 8,840 

$12,347 

$45,917 

$260,000 

$305,917 

$15,295 

$321,212 

$50,310 

$000 

$1,713 

$52,023 

4 
Proposal to Provide Essential Air Service at 

Gulkana, May Creek, and McCarthy, Alaska 

Docket DOT=OST-1995-492 

Rate Period Feb 1, 2013 to Jan 31, 2015 

Work Sheet 

Projection 

MXY and MYK Cost Projection 

Aircraft Type: Cessna 185 & Cessna 206 

Block Hours 240 

Pilot @ $133.00 I hr 

$115.00 Pilot 

$5.75 Workman's Comp 

$3.45 Unemployment 

$7.13 Social Security 

$1.67 Medicare 

Fuel & Oil @ $183.43 

17 Gal/ hr 

$5.82 base price 

$0.02 State Airport Tax 

$31,920 

$44,023 

$1.98 Storage, Handling, Spill and Liability Insurance 

$0.88 Projected rate increase 2011-2013 

$8.70 per Gal+ $2.09 per hour oil 

Total=$ per Gallon fuel and Oil X 17.0 Gallon per hour 

Insurance @ $113.87 $27,328 

$165,000 Hull x .13/400 = $53.62 per hour 

$5,700 3rct party+ 4 seats X 4,600/400 = $60.25 

Total of $113.87 

5 
Proposal to Provide Essential Air Service at 

Gulkana, May Creek, and McCarthy, Alaska 

Docket DOT=OST-1995-492 

Rate Period Feb 1, 2013 to Jan 31, 2015 

Maintenance@ $143.15/ hr $34,356 

Two (2.4) one hundred hour inspections= 240 hours 

28.0 hours flat rate@ $13p.oo per hour shop rate= $3,640 X 2.4 = $8,736 

Annual Inspection 35 hours@ $130.00 per hour shop rate= $4,550 

Total for inspections only= $13,286 

lnspections/240 hours $55.36 

Engine $56,000/1500 hr. $37.34 

Propeller $10,000/1500 hr. $6.67 

Instruments and radios $4.94 

Routine maintenance & unscheduled $38.84 

Total $143.15 per hour 

Depreciation @ $26.66 I hr $6,398 

Hourly rate $26.66 @ 160,000/6000 

Total Directs $144,025 

lndirects $86,754 

Hanger Lease Year Round@ $4,900 per month x 12 = $58,800% use= $29,400 

Ground Handling Aircraft and Passengers $15,500 

Advertising $9,949 

Commissions, includes GKN-ANC-GKN $27,750 x 10% $2,775 

Management I Security $22,980 

Office and Phone Reservations $6,150 

Total indirect 

Total Direct $144,025 

Total Indirect $86,754 

Total Operating Expenses $230,779 

Return (5% of opr. Exp) $11,639 

~I 

I 

$86,754 

6 
Proposal to Provide Essential Air Service at 

Gulkana, May Creek, and McCarthy, Alaska 

Docket DOT=OST -1995-492 

Rate Period Feb 1, 2013 to Jan 31, 2015 

Operating Revenues 

Passenger Revenues 

103 passengers MXY@ 95.00 

27 passengers MYK@ 115.00 

$9,785 

Mail revenue total 25,777 lbs @ .82 

Freight revenue 2,791 lbs@ .75 

Total Revenue 

Total Economic Costs $242,318 

Total Revenue $36,120, 

Total subsidy need@ 100% = $206,198 

$3,105 

$21,137 

$2,093 

$36,120 

7