Order: 2014

- 11

- 3

Served November 7, 2014



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 7 th day of November

, 20 1 4

Essential Air Service at

LAKE MINCHUMINA , ALASKA

RAMPART , ALASKA DOT

- OST

- 2008

- 0237

DOT

- OST

- 2008

- 0201

under 49 U.S.C. 41731 et seq.



### ORDER S ELECTING CARRIER S ESTABLISHING SUBSIDY

RATES AND TEMPORARILY EXTENDING CURRENT SUBSIDY

Summary By th is O rder, the Department is re

- selecting Wright Air Service, Inc., (Wright Air) to provide Essential Air S ervice (EAS) at Lake Minchumina, with two nonstop round trips per week to Fairbanks, using either 9

- seat Cessna 208 Caravan or Piper PA

- 31 aircraft for one flight per week

, and a 4

- seat Cessna 206 or 3

- seat Beechcraft Bonanza A36 aircraft for an additional flight per week, at an annual subsidy rate of $102,300, for the two

- year period

from November 1, 2014, through October 31, 2016. 1

T his Order is also selecting Tatonduk Outfitters Limited d/b/a Everts Air Alaska (Everts Air) to provide EAS at Rampart, with two nonstop r ound trips per week to Fairbanks , using

either 9

- seat Pilatus PC

- 12 or Cessna Grand Caravan aircraft

, at an annual subsidy rate of $ 60,20 1

, for the two

- year period from December 1, 201 4 , through October 31 , 201 6

. 2

Also by this Order, the Department is temporarily extending the service period of Warbelow’s Air Ventures, Inc. (Warbelow’s) to provide EAS at Rampart from

November 1, 2014, until Everts Air commences full EAS at Rampart, but no later than

1 Such subsidy is calculated and distributed on a fiscal year basis, subject to the availability of funds.

2 Such subsidy is calculated and distributed on a fiscal year basis, subject to the availability of funds.- 2

-

January 31, 2015. Warbelow’s will continue to provide Rampart with two nonstop round trips per week to Fairbanks with Piper Navajo equipment, at its current annual subsidy rate of $76,416

. 3

Background By Order 2012

- 10

- 14 , issued on October 11 , 2012, the Department re

- selected Wright Air to provide subsidized EAS at Lake Minchumina with two nonstop round trips per week to

Fairbanks , using either 9

- seat IFR Certified or 4

- seat single

- engine piston aircraft, at an annual subsidy rate of $102,300. Also by that O rder, the De partment re

- select ed

Warbelow’s to provide EAS at Rampart with two nonstop round trips per week to Fairbanks using Piper Navajo aircraft, at an annual subsidy rate of $76,416.

Lake Minchumina and Rampart are guaranteed to receive at least a minimum level of air service under the EAS program by virtue of the fact that those communities appeared on a

certificated carrier’s Civil Aeronautics Board

- issued certificate on October 24, 1978, the

date the Airline Dere gulation Act of 1978 was signed into law. (See 49 U.S.C. §§ 41731

and 41744 for the EAS program’s governing statutes )

. In keeping with our normal procedure s , in anticipation of the end of the rate term, the Department issued Order

2014

- 6

- 8 on June 17 , 20 14, soliciting proposals from air carriers interested in providing

EAS at L ake Minchumina and Rampart , with subsidy support if necessary, for a new term beginning November 1, 2014

.

That O rder

, as well as t he complete public file for EAS at Lake Minchumi na and Rampart

, may be accessed online through the Federal Docket Management System at http://www.regulations.gov , by entering “DOT

- OST

- 2008

- 0237 ” for Lake Minchumina

and “DOT

- OST

- 2008

- 0201 ” for Rampart in the “SEARCH for: Rules, Comments, Adjudications or Supporting Documents:” field.

Proposal of Everts Air at Lake Minchumina and Rampart Everts Air proposed to provide two nonstop round trips per week between both Lake

Minchumina and Rampart to F airba nks with either a Pilatus P C

- 12 or Cessna Caravan,

both of which are 9

- seat I

. F

. R

. certified single

- engine turboprop airc raft, at an annual subsidy rate of $101,564 at Lake Minchumina , and $60,201 at Rampart. Everts Air’s proposal for each community is distinct and does not require it to be selected for both

communities.

Proposal of Wright Air at Lake Minchumina Wright Air propose d to provide two nonstop round trips per week between Lake

Minchumina and Fair banks with either a 9

- seat I.F.R. certified Cessna 208 Caravan or 4

- seat Piper PA

- 31 aircraft, at an annual subsidy rate of $102,300.

Proposal of Warbelow’s Air Ventures at Rampart Warbelow’s proposed to provide either two or three nonstop round trips per week between Rampart and Fairbanks, using a 4

- seat Piper PA

- 31 aircraft . For three round trips per

3 Such subsidy is calculated and distributed on a fiscal year basis, subject to the availability of funds.- 3

-

week, Warbelow’s subsidy request is $116,834 annually, or $233,668 for two years . For two round trips per week, Warbelow’s subsidy request is $75,281 annu ally

, or $150,562 for two years.

Community Comments By letters dated August 1 and September 9, 2014 , the Department requested community comments regarding this EAS selection case. In response, by letter dated

October 15, 2014, the Lake Minchumina Homeowners Association provided support for Wright Air’s proposal. Mr. Walter Maakestad, Vice President of the Minchumina Homeowners Association, stat ed that Wright has earned a positive reputation in the community by “providing timely, reliably efficient and caring customer service.” Mr.

Maakestad further stated that, “we would like to see [Wright Air] continue to serve in such a capacity in the future.”

Additionally, b y letter dated July 1, 2014, Ms. Antoinette Wright, Second Chief of the Rampart Vill age Council, submitted a letter in support of Everts Air’s proposal to pro vide EAS to Rampart. Ms. Wright stated that Everts’ staff, service, schedule, level of service, safety, and commitment meets the needs of the community.

Decision When selecting a carrier to provide EAS in Alaska, 49 U.S.C. §41733(c)(1) directs the Department to consider six factors: (1) service reliability; (2) contractual and marketing arrangements with a larger carrier at the hub; (3) interline arrangements with a larger

carrier at the hub; (4) community views; (5) the carrier’s plan to market its service to the community; and (6) the experience of the applicant in providing scheduled air service or significant patterns of non

- scheduled air service. In addition, the Continuing

A ppropriations Act, 2014, Public Law No. 113

- 46, and continued in the Continuing Appropriations Resolution, 2015, Public Law No. 113

- 164, provides that when selecting a carrier to provide EAS, the Department may consider the relative subsidy requirements, thus codifying a factor that we have considered since the inception of the program.

W e have decided to select Wright Air to provide EAS at Lake Minchumina. We note that Everts Air requires slightly less subsidy, however t he Lake Minchumina community fully supports Wright Air, which has a successful history of providing EAS at Lake

Minchumina

. Additionally, we find the proposed subsidy ra tes to be reasonable and the air carrier’s performance satisfactory

.

We have decided to select Everts Air to provide EAS at Rampart. T he Rampart community supports Evert s Air’s proposal, which requires less subsidy than Warbelow’s proposal. Additio nally, w e find the service levels and subsidy request to be reasonable

. The selection of Wright Air and Everts Air will ensure the citizens of Lake Minchumina and Rampart will continue to have access to the national a ir t ransportation system.- 4

-

Air Carrier Fitness

49 U.S.C. §§ 41737(b) and 41738 require that we find an air carrier fit, willing, and able to provide reliable air transportation before we may subsidize it to provide EAS

. Wright Air

and Everts Air are subj ect to the Department’s continui ng fitness requirements, and no

information has come to our attention tha t would cause us to questio n the air carrier s ’ fitness at this time. We have contacted the Federal Aviation Administration, and it has raised no concerns that would negatively affect our fitness finding s . We therefore conclude

that both air carrier s are reliable and remain fit to conduct the operations proposed here.

This Order is issued under authority delegated in 49 CFR Part 1.25a(b)

.

ACCORDINGLY,

1. The Department select s Wright Air Service, Inc. to provide Essential Air S ervice at Lake Minchumina, Alaska

, at the service level and subsidy rate s described in Appendix B

, for the period from November 1, 2014, through October 31, 2016;

2. The Department selects Tatonduk Outf itters Limited d/b/a Everts Air Alaska to provide

Essential Air S ervice at Rampart

, Al aska

, at the service level and subsidy rate s described in Appendix B , for the period from November 1, 2014, through October 31, 2016 ;

3

. The Department requires Warbelow’s Air Ventures, Inc. , to continue to provide Essential Air Service at Rampart, Alaska, until Tatonduk Outfitters Limited d/b/a Everts Air Alaska commences full Essential Air Service at Rampart, but no later than January 31, 2015;

4. The Departme nt set s the rate of compensation for Tatonduk Outfitters Limited d/b/a Everts Air Alaska, for the provision of Essential Air Service at Rampart, Alaska, as described in Appendix B.

5

. The Department direct s Wright Air Service, Inc.

, Tatonduk Outfitters Limited d/b/a

Everts Air Alaska

, and Warbelow’s Air Ventures, Inc., to retain all books, records, and other source and summary documentation to support claims for payment, and to preserve and maintain such documentation in a manner that readily permits its audit and examination by representatives of the Department. Such documentation shall be retained for seven years from the service date of this Order or until the Department indicates that the records may be destroyed, whichever comes first. Copies of fl ight logs for aircraft sold or disposed of must be retained. The air carrier may forfeit its compensation for any claim that is not supported under the terms of this Order ;

6

. The Department f i nd s Wright Air Service, Inc. and Tatonduk Outfitters Limited d/b/a

Everts Air Alaska

, continue to be fit, willing and able to operate as certificated air carrier s and capable of providing reliable Essential Air S ervice at Lake Minchumina and Rampart

, Alaska ;- 5

-

7

. These docket s will remain open pending further Dep artment action ; and

8

. The Department will serve cop i es of this Order on the civic offic i als of Lake Minchumina and Rampart , Alaska

, the Alaska Department of Transportation and Public Facilities, and the service list for these docket s

.

B y:

BRANDON M. BELFORD Deputy Assistant Secretary for

Aviation and International Affairs

(SEAL)

An electronic version of this document is ava ilable at http://www.regulations.govAppendix A Page 1 of 2 

## Wright Air

Annual Compensation Requirements for Essential Air Service at

Lake Minchumina , AlaskaAppendix A
Page 2 of 2 

## Everts Air

Annual Compensation Requirements for Essential Air Service at
Rampart, AlaskaAppendix B Page 1 of 3

Wright Air Essential Air Service

to be provided at Lake Minchumina , Alaska , DOT

- OST

- 2008

- 0237

Effective Period : November 1

, 201 4 , through October 31

, 201 6

Scheduled Service : T w o nonstop round trips each week to Fairbanks , Alaska

Aircraft : One with 9

- seat Cessna 208 Caravan or 9

- seat Navajo Piper PA

- 31 aircraft; one with 4

- seat Cessna 206 or 3

- seat Beechcraft Bonanza A36 aircraft. Rate per Eligible Fli ght: $ 4 92 1
Weekly Ceiling : $ 1,9 68 2

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significant elements of the required service, without prior approval. The carrier understands that an aircraft take

- off and landing at its scheduled destination constitutes a completed flight; absent an explanation supporting subsidy e ligibility for a flight that has not been completed, such as certain weather cancellations, only completed flights are considered eligible for subsidy. In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant period, it may jeopardize its entire subsidy claim for the period in question. If the carrier contemplates any such changes beyond the scope of the Order during the applicable period of this rate, it must first notify the Office of Avia tion Analysis in writing and receive written approval from the Department to be ensured of full compensation. Should circumstances warrant, the Department may locate and select a replacement carrier to provide service on these routes. The carrier must

co mplete all flights that can be safely operated; flights that overfly points for lack of traffic will not be compensated. In determining whether subsidy payment for a deviating flight should be adjusted or disallowed, the Department will consider

the exten t to which the goals of the program are met and the extent of access to the national air transportation system provided to the community.

If the Department unilaterally, either partially or completely, terminates or reduces payments for service or changes service requirements at a specific location provided for under this Order, then, at the end of the period for which the department does make payments in the stipulated service levels, the carrier may cease to provide service to that specific location with out regards to any requirement for notice of such cessation. Those adjustments in the levels of subsidy and/or service that are mutually agreed to in writing by the Department and carrier do not constitute a total or partial reduction or cessation of paym ent.

Subsidy contract are subject to, and incorporate by reference, relevant statutes and Department regulations, as they may be amended from time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert

the foregoing paragraph.

Funds may not be available for performance under this order beyond December 11 , 2014. The Government’s obligation for performance under this order beyond December 11, 2014 , is subject to the availability of funds from which payment for

services can be made. No legal liability on the part of the Government for any payment may arise for performance under this order beyond December 11, 2014 , until funds are made available to the Department for performance. If sufficient funds are

not made available for performance beyond December 11, 2014 , the Department will provide notice in writing to the carrier.

All claims for payment, including any amended claims, must be submitted within 90 days of the last day of the month for which compensati on is being claimed. For example, claims for service provided in July must be filed by

October 31; August claims must be submitted by November 30, and so on.

1 Annual compensation of $ 102,300 divided by 208 arrivals and departures: 4 flights per week x 52 weeks.

2 The subsidy rate for each arrival/departure ( $ 4 92 ) multiplied by four eligible arrival and departure each week.Appendix B
Page 2 of 3

Everts Air Alaska Essential Air Service
to be provided at Rampart , Alaska, DOT

- OST

- 2008

- 0201

Effective Period : November 1, 2014, through October 31, 2016

Scheduled Service : T wo nonstop round trips each week to Fairbanks, Alaska

Aircraft : Pilatus PC

- 12 (9

- Seat) or Cessna Caravan (9

- Seat) Rate per Eligible Flight: $ 289 3
Weekly Ceiling : $ 1,156 4

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significan t
elemen ts of the required service, without prior approval. The carrier understands that an aircraft take

- off and landing at its scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight that

has not b een completed, such as certain weather cancellations, only completed flights are considered eligible for subsidy. In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant per iod, it may jeop ardize its entire subsidy claim for the period in question. If the carrier contemplates any such changes beyond the scope of the Order during the applicable period of this rate, it must first notify the Office of Aviation Analysis in writing and receive w ritten approval from the Department to be ensured of full compensation. Should circumstances warrant, the Department may locate and select a replacement carrier to provide service on these routes. The carrier must complete all flights that can be safely operated; flights that overfly points for lack of traffic will not be compensated. In determining whether subsidy payment for a deviating flight should be adjusted or disallowed, the Department will consider the extent to which the goals of the program ar e met and the extent of access to the national air transportation system provided to the community.

If the Department unilaterally, either partially or completely, terminates or reduces payments for service or changes service requirements at a specific lo cation provided for under this Order, then, at the end of the period for which the department does make payments in the stipulated service levels, the carrier may cease to provide service to that specific location without regards to any requirement for not ice of such cessation. Those adjustments in the levels of subsidy and/or service that are mutually agreed to in writing by the Department and carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract are subject to, and incorporate by reference, relevant statutes and Department regulations, as they may be amended from time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds may not b e available for performance under this order beyond December 11, 2014

. The Government’s obligation for performance under this order beyond December 11, 2014 , is subject to the availability of funds from which payment for

services can be made. No legal li ability on the part of the Government for any payment may arise for performance under this order beyond December 11, 2014 , until funds are made available to the Department for performance. If sufficient funds are not made available for performance beyond December 11, 2014 , the Department will provide notice in writing to the carrier.

All claims for payment, including any amended claims, must be submitted within 90 days of the last day of the month for which compensation is being claimed. For example, cla ims for service provided in July must be filed by

October 31; August claims must be submitted by November 30, and so on.

3 Annual compensation of $ 60,201 divided by 208 arrivals and departures: 4 flights per week x 52 weeks.

4 The subsidy rate for each arrival/departure ($ 289 ) multiplied by four eligible arrival and departure each week.Appendix B Page 3 of 3

Warbelow’s Air Ventures, Inc. Essential Air Service
to be provided at Rampart , Alaska, DOT

- OST

- 2008

- 0201

Effective Period : November 1, 2014, through January 31, 2015

Scheduled Service : T wo nonstop round trips each week to Fairbanks, Alaska

Aircraft : Piper Navajo (9

- Seat) Rate per Eligible Flight: $ 367 1
Weekly Ceiling : $ 1,468 2

Note: The carrier understands that it may forfeit its compensation for any flights that it does not operate in conformance with the terms and stipulations of the rate Order, including the service plans outlined in the Order and any other significan t elements of the required service, without prior approval. The carrier understands that an aircraft take

- off and landing at its scheduled destination constitutes a completed flight; absent an explanation supporting subsidy eligibility for a flight that has not been completed, suc h as certain weather cancellations, only completed flights are considered eligible for subsidy. In addition, if the carrier does not schedule or operate its flights in full conformance with the Order for a significant per iod, it may jeopardize its entire subsidy claim for the period in question. If the carrier contemplates any such changes beyond the scope of the Order during the applicable period of this rate, it must first notify the Office of Aviation Analysis in writing and receive written approval fr om the Department to be ensured of full compensation. Should circumstances warrant, the Department may locate and select a replacement carrier to provide service on these routes. The carrier must complete all flights that can be safely operated; flights that overfly points for lack of traffic will not be compensated. In determining whether subsidy payment for a deviating flight should be adjusted or disallowed, the Department will consider the extent to which the goals of the program are met and the exte nt of access to the national air transportation system provided to the community.

If the Department unilaterally, either partially or completely, terminates or reduces payments for service or changes service requirements at a specific location provided fo r under this Order, then, at the end of the period for which the department does make payments in the stipulated service levels, the carrier may cease to provide service to that specific location without regards to any requirement for notice of such cessat ion. Those adjustments in the levels of subsidy and/or service that are mutually agreed to in writing by the Department and carrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contract are subject to, and incorporate b y reference, relevant statutes and Department regulations, as they may be amended from time to time. However, any such statutes, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds may not be available for performance under this order beyond December 11, 2014. The Government’s obligation for performance under this order beyond December 11, 2014, is subject to the availability of funds from which payment for

services can be made. No legal liability on the p art of the Government for any payment may arise for performance under this order beyond December 11, 2014, until funds are made available to the Department for performance. If sufficient funds are not made available for performance beyond December 11, 201 4, the Department will provide notice in writing to the carrier.

All claims for payment, including any amended claims, must be submitted within 90 days of the last day of the month for which compensation is being claimed. For example, claims for service provided in July must be filed by

October 31; August claims must be submitted by November 30, and so on.

1 Annual compensation of $ 76,416 divided by 208 arrivals and departures: 4 flights per week x 52 weeks.

2 The subsidy rate for each arrival/departure ($ 367 ) multiplied by four eligible arrival and departure each week.