Grant Aviation, Inc P.O. Box 92200 Anchorage, AK 99509 Proposal to Provide EAS atAkutan, Alaska Docket DOT-OST-2000-7068 EAS 

### & Domestic Analysis Division Office ofAviation Analysis U.S. Department ofTransportation 400 71h Street S.W., Room 6401 Washington, D.C. 20590 July 3, 2014 Dear Sirs, Enclosed, find GrantAviation, Inc.'s proposal to provide Essential Air Service between Dutch H rbor, Alaska and the runway on Akun Island, Alaska forthe period October 1, 2014 through September 30, 2016. In accord with the Department's request for proposals, GrantAviation proposesto provide Tw lve direct, nonstopflights perweek between Dutch Harbor and the runway on Akun Island. The aircrafttypesto be utilized forthis proposed service are Beech Kingair B-200, and Piper P 31-350. Both plane types are 9 seat, twin engine aircraft, fully equipped for IFR flight. This proposal makes NO provision fortransportation between the runway on Akun and the vii age ofAkutan. Currently this service is being provided by the Aleutians East Borough, via contract with a local helicopteroperator. This proposal WILL providefor handling ofinbound and outbound mail and freight to and fro thevillage ofAkutan, via an agreement between GrantAviation and the Aleutians East Borough. At 100% performance ofthe schedule proposed above, GrantAviation expects atotal annual conomic cost of $1,322,327.34 Estimated annual revenue derived from scheduled passenger fares, freight tari s, and compensation for transporting U.S. Mail flown along the route is expected tototal $491,212.00, leaving $831,11 .34 in uncovered costs. To coverthe difference between expected economic costs and expected revenues, GrantAvia ion will require an annual subsidy of$831,115.34. We look forward to working with you in providing service to the people ofAkutan. Ifyou require further information, I may be contacted by phone at 907 529-6999, or by e-mail at bmcglasson@flygrant.com. Cost data follows. Respectfully,

# !{Jf£~!1~ President, GrantAviation, Inc.

## Akutan EAS Cost Data Weekly Round Trips 

### 12 Annual RT Flights @ 

### 100% completion 

### 624 Per RT flight Block Time 

### 0.66 Annual Block Hours 

### 4 1.84 Distance OUT- Akun Airport (stat miles) 

### 41 Annual 0/W Passengers expected 

### t.,500 OW fare $ 

### 1[4.00 Annual maillbs expected 

### 12(,000 Current mail rate 

## I lb $ 

### 0. 076 Annual Freight lbs expected 

### 3(,000 Current Freight rates 

## I lb $ 

### 0.71 Total Annual Block Hours 

### 411.8

Revenue Annual Revenue Passenger Fares $ 

### 385,000.00 Mail Revenue $ 

### 84,912.00 Freight Revenue $ 

### 21,300.00 Total Annual Revenue from Scheduled Operations 

### $ 491,212.00

Direct Expense Base Urits Annual Direct Exp. Fuel/oil ($/gallon) $ 

### 6.455 4 

### ,243 $ 

### 279,134.86 Aircraft lease expense (monthly lease) $ 

### 4,500.00 

### 12 $ 

### 54,000.00 Maintenance (engine&prop +labor+parts

## I block hr) $ 

### 656.00 L 

### 11.8 $ 

### 270,167.04 Pilot labor, all inclusive w/tax&beni

## I daily rate $ 

### 440.80 365 $ 

### 160,892.00 Aviation Insurance annual hull and liability $ 

### 38,000.00 Total Annual Direct Expense 

### $ 802,193.90

Indirect Expense Base Ur its Annual Indirect Exp. Hanger lease 

## I month $ 

### 4,000.00 

### 12 $ 

### 48,000.00 Ticketing & ground service 

## I perturn $ 

### 200.00 624 $ 

### 124,800.00 Freight & mail Handling OUT, Akun, Akutan 

## I lb $ 

### 0.62 15(,000 $ 

### 93,000.00 Pilot housing+utility

## I month $ 

### 2,100.00 12 25,200.00 Total Annual Indirect Expense 

### 291,000.00

Sum ofdirect and indirect costs 

### 1,093,193.90 Add Burden 

### 15.2% 166,165.47 subtotal 

### 1,259,359.37 Add Profit @ 

### 5.0% 5.0% 62,967.97 Total Annual Economic Cost 

### 1,322,327.34 Total Annual Revenue from Scheduled Operations 

### 491,212.00 Annual Subsidy Required 

### 831,115.34