### Order 2013

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- 8 Served: April 12, 2013 UNITED STATES OF AMERICA DEPARTMENT OF TRANSPORTATION OFFICE OF THE SECRETARY WASHINGTON, D.C. Issued by the Department of Transportation on the 12 th 

### of April, 2013

INTRA

- ALASKA MAINLINE SERVICE MAIL RATES under 49 U.S.C. 41901 et seq
. Docket OST - 2003 - 14695 (Docket 95 - 429)
Mainline Quarterly Fuel Update By Order 2012

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- 4, September 20, 2012, the Department directed the parties to show cause by September 25, 2012, why we should not make final the annual rate s tentatively set forth in that Order , based on expenses and traffic for the year ended March 31, 2012

. Order 2012

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- 26 finalized that annual update, and also adjusted the rate to reflect fuel expenses for the quarter ended June 30, 2012, the most recent data then available. The Department has indicated that we would update mail rates on a quarterly basis as more recent fuel data became available, with typically a one

- quarter lag between the end of the reporting period and the effective period of the ne w rate. Consistent with that longstanding program practice, we will here update the rates set by Order 2012

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- 5 to reflect fuel costs for the quarter ended December 31 , 2012, as shown in the Appendices. ACCORDINGLY, 1 . We make final the rates set fort h in Appendix A of this Order, effective April 20 , 201 3 ; 2 . This docket shall remain open until further Order of the Depar tment ; and 3 . We will serve this order upon all parties on the Service List for this Docket. Persons entitled to petition the Depa rtment for review of this Order under the Department’s Regulations, 14 CFR 385.50, must file such petitions within ten (10) days after the date of service of this Order. This Order will be effective immediately, and the filing of a petition for review sha ll not preclude its effectiveness. By:

TODD M. HOMAN Director Office of Aviation Analysis (SEAL) An electronic version of this document is available on the World Wide Web at http://www.regulations.govAppendix A INTRA-ALASKA MAINLINE CLASS SERVICE MAIL RATES

(1) (2) (3) (4) (5) Effective Base Year Adjustment April 20, 2013 Change from

Rates 1/ Factors 2/ Final Rates 3/ Current Rate 4/ Current Rate 5/
Linehaul Charge per Billing Ton-Mile

Priority $1.1969 196.88% $3.5534 $3.6133 -1.66% Non-priority $0.7246 196.88% $2.1512 $2.1875 -1.66%

Terminal Charge per Pound Originated

Priority $0.1697 112.07% $.3599 $.3599 0.00% Non-priority $0.1458 112.07% $.3092 $.3092 0.00% 1/ Per Order 82-11-23. 2/ See Appendix B of this order. Unlike the linehaul charge, the terminal charge will not change from quarter to quarter with the quarterly fuel updates. 3/ Column (1) increased by Column (2). 4/ Per Order 2012-12-5. 5/ Column 3 ÷ Column 4 minus 1. Any differences between priority and nonpriority elements are due to rounding.Appendix B

INTRA-ALASKA MAINLINE CLASS SERVICE MAIL RATES COST ADJUSTMENT FACTORS

Base Year Ended Current New 9/30/80 Costs 2/ Costs
Unit Cost per Available Ton-Mile Fuel $0.54412 $0.52411 3/ Nonfuel $0.66184 $0.66184 4/ Total $0.399469 1/ $1.20596 $1.18595

Percentage Change from Base Year 201.89% 196.88% 5/
Unit Cost per Ton Enplaned $191.54 1/ $406.19 $406.19 4/ Percentage Change from Base Year 112.07% 112.07% 6/

1/ Order 82-11-23, updated most recently in Order 97-12-24. 2/ Appendix B of Order 2012-12-5. 3/ Appendix C of this Order. 4/ Appendix B of Order 2012-9-4. 5/ ( $1.18595 /$0.399469)-1. 6/ ( $406.19 /$191.54)-1.Appendix C Operating Expenses, Alaska Airlines, Northern Air Cargo, Lynden Air Cargo, Peninsula Airways, Era Aviation, and Tatonduk Outfitters, Ltd. Intra-Alaska Class Service Mail Rates--Quarter Ended December 31, 2012 Lynden Northern Peninsula Alaska ERA Air Cargo Air Cargo Airways 4/ Tatonduk Outfitters, Ltd. Not by Aircraft Type AS 7H L2 NC KS 3Z 1 Skd. P-12, Skd. Intra-Alaska Costs $14,908,391 NA $944,569 $3,347,784 NA $3,149,343 2 Skd. P-12, Skd. Intra-Alaska Gallons 4,714,221 NA 274,149 1,035,590 NA 793,346 3 Cost per Gallon 1/ $3.16 NA $3.45 $3.23 NA $3.97

AS 7H L2 NC KS 3Z 3Z 3Z #617 #483 #556 #620 456 #218 #461 640 By Aircraft Type Total B-737-400 DHC-8-100 Hercules 737-200 SF-340B DC-6 Brasilia DC-9-30 4 Domestic Gallons 2/ 16,589,000 543,088 910,802 1,261,732 598,761 294,072 21,700 582,922 5 Burn per Hour 3/ 789 171 712 890 137 401 171 897
6 Fuel 4/ $2,086,287 $2,444,757 $1,496,785 $84,568 $2,211,399

7 Intra-AK Skd. Blk. Hrs. 5/ 15,077 8,739 2,781 378 1,098 797 523 127 634 8 Domestic Block Hours 6/ 32,749 21,013 3,168 1,280 1,418 4,360 733 127 650

9 Intra-AK Fuel Exp. 7/ $31,461,187 $21,788,424 $1,831,428 $928,519 $3,156,421 $446,897 $1,067,965 $84,568 $2,156,965

10 Intra-AK Skd. ATMs 5/ 67,274,512 51,092,749 2,245,481 2,411,664 5,655,566 563,377 1,486,333 104,276 3,715,066 11 Unit Cost/ATM, Fuel 8/ $0.467654 $0.426448 $0.815606 $0.385012 $0.558109 $0.793247 $0.718523 $0.811002 $0.580599
12 Intra-AK Mail RTMs 5/ 5,719,882 1,396,577 73,057 924,140 1,511,036 46,118 507,518 42,957 1,218,479 13 RTM Percent of Total 9/ 100.00% 24.416% 1.277% 16.157% 26.417% 0.806% 8.873% 0.751% 21.303% 14 Wtd. Cost/ATM, Fuel 10/ 

### $0.52411 $0.10412 $0.01042 $0.06221 $0.14744 $0.00639 $0.06375 $0.00609 $0.12369

1/ Row 1 ÷ Row 2. PenAir and Era do not report Schedule P12. Tatonduk files that report but we do not use it here. It is in lcuded for comparison purposes only. 2/ Per Form 41 except for for PenAir and Era, where we rely on Schedule F2. 3/ Row 4 ÷ Row 8. 4/ Per Form 41 for Tatonduk, Schedule F2 for PenAir and Era. AS, L2, and NC are excluded, as we rely on their Schedule P12 abo ve. 5/ T-100 Segment Report, except for PenAir. For Penair we rely on its special report for scheduled Intra-Alaska mainline traff ic -- Hours, ATMs, and Mail RTMs. For its domestic block hours, we exclude the carriers operations outside of Alaska. Intra-Alaska traffic is shown on its Sched ule F2 and special report. 6/ T-100 Segment Report, except for PenAir. Domestic block hours for PenAir actually excludes its operations outside of Alaska, because PenAir's Schedule F-2 only includes its expenses within Alaska. 7/ For AS, LC, and NC: Row 3 x Row 5 x Row 7; For 3Z, 7H, and KS: Row 6 ÷ Row 8 x Row 7. 8/ Row 9 ÷ Row 10. 9/ Row 12 for each individual carrier ÷ Total Mail RTMs for all carriers on Row 12. 10/ Row 13 x Row 11 for individual carriers, and then summed across.