### Orde r 2010-12- 7 Served : Decembe r

3 , 201 0 UNITE D STATE S O F AMERIC A DEPARTMEN T O F TRANSPORTATIO N OFFIC E O F TH E SECRETAR Y WASHINGTON , D.C
.

Issue db y th e Departmen t o f Transportatio n o n th e 3" * o f

December , 201 0 Essentia l Ai r

Servic e a t ANGOON , ALASKA , AN D TENAKEE , ALASK A Unde r 4 9 U.S.C
. 4173 1 e t

seq . DOCKE T OST-2006-2554 2 DOCKE T OST-2006-2554 2

ORDE RRESELECTIN G CARRIE R Summar y B y thi s order , th e Departmen t i s reselectin g Alask aSeaplan e Service , LLC , t o provid e essentia l ai r servic e (EAS ) a

t Angoo n an dTenakee , Alaska , at annua l subsid y rate s o f

$145,73 4 a

t Angoo n an d$135,57 6 a

t Tenakee , fro mFebruary 1 , 2011 , throug h Januar y 31 , 2015
. 1 Backgroun d Orde r 2008-12-2 7 selecte dAlask aSeaplan e t o provid e te n roun dtrip s pe r wee k i n th e peak

an d fiv e i n th e off-pea

k t o Angoon , an dseve n roun dtrip s pe r wee k i n th e peak

an dthre e i n th e off

peak t o Tenakee , a

t annua l subsid y rate s o f

$101,35 9 an d$63,748 , respectively

. Al l o f th e servic e wa s t o b e provide do n anonsto p basi s t o Junea u with DeHavillan dBeave r aircraft

. In anticipatio n of

th e en do f

th e curren t

contract , b y Orde r

2010-9-1 6 w e requeste dproposal s for replacemen t

service. W e receive daproposa l fro monl y on e carrier , Alask aSeaplane , an d requeste dcomment s fro mth e communitie s an dstate. W e receive dinformal comment s fro mth e state , an dth e issu e i s rip e for decision

. Carrie r Proposa l Alask aSeaplan e was th e onl y carrie r t o submi t

aproposal , an dit s proposa l include donl y on e optio n for th e sam e servic e a s currentl y selected , with combine dsubsid y o f $281,310 , a s follows : 2
1 Suc h subsid y i s calculate dan

ddistribute don afisca

l yea r basis , subject

t o th e availabilit

y o f appropriatedfunds

. 2 Alask aSeaplan e initiall y requestedtota

l annua l subsid y fo r Angoo n an dTenakee combine

do f $333,485

.

### - 2

Angoo n Te n nonsto p roun dtrip s pe r wee k t o Junea u i n th e 18-week peak an dfive nonsto p roun dtrip s pe r

wee k i n th e 34-wee k

off-pea k for $145,73 4 annua l subsidy

. Al l of th e servic e woul db e operate dwith single-engin e DeHavillan dBeave r aircraft

. Tenake e Seve n nonsto p roun dtrip s pe r wee k t o Junea u i n th e 18-wee k pea k an dthre e nonsto p roun dtrip s pe r

wee k i n th e 34-wee k

off-pea k for $135,57 6 annua l subsidy

. Al l o f th e servic e woul db e operate dwith single-engin e DeHavillan dBeave r aircraft

. Communit y Comment s Th e communitie s an dstat e continu e t o support th e EA S provide db y Alask aSeaplane , an dstat e that : "Du e t o th e isolate dlocatio n o f thes e communitie s an dth e complet e lac k o f an y road

syste mconnection , thi s subsidize dai r servic e i s thei r

onl y for mo f schedule d transportation

. Th e communitie s o f Angoo n an dTenake e depen do n schedule dai r freight , passenger , an dmai l servic e for basi c necessities , routin e medica l an dhealth services , an deconomi c welfare. " Decisio n Alask aSeaplan e i s th e onl y carrie r t o submi t

aproposal , i t

submitte donl y on e option , an dw e hav e decide dt o selec t

it , adjuste dfor

th e reduce dsubsid y leve l i t agree dto , for

afour-yea

r period , February 1 , 2011 , throug h Januar y 31 , 2015
. W e fin dtha t th e carrier' s propose dservic e an dsubsid y level s ar e reasonable , an dw e ar e no t awar e o f an y reaso n wh y w e shoul dno t re selec t th e carrie r

t o provid e th e propose dleve l o f service. Th e Departmen t

shal l mak e thi s selectio n contingen t upo n ou r receivin g properl y execute d certification s fro mth e carrie r tha t i t i s i n complianc e with th e regulation s regardin g drug-fre e workplace s an dnondiscrimination , a s wel l a s th e regulation s govemm g lobbyin g activities

. Carrie r Fitnes s 4 9 U.S.C
. 41737(b ) an d4173 8 require s tha t DO T finda n ai r

carrie r fit , willing , an dabl e t o provid e reliabl e servic e befor e DO T may subsidiz e i t t o provid e essentia l ai r

service. Alask a Seaplan e Service , LLC
. i s subjec t t o th e Department' s continuin g fitnes s requurements , an dn o informatio n ha s com e t o ou r attentio n tha t

woul dcaus e u s t o questio n th e carrier' s fitnes s a t thi s time

. DO T ha s contacte dth e Federa l Aviatio n Administration , an dit ha s raise dn o concern s that woul dnegativel y affec t

ou r fitnes s findings. DO T therefor e conclude s tha t th e carrier s remai n fit t o conduc t

th e operation s propose dhere

. Thi s orde r

i s issue dimde r

authorit y delegate di n 4 9 CF R1.56a(f)

. ACCORDINGLY , 1
. W e reselec t

Alask aSeaplan e Service , LLC , t o provid e essentia l ai r servic e at

Angoo n an d Tenakee , Alaska , a s describe di n Appendi x C ;

## 3
-

2
. W e direc t

Alask aSeaplan e Service , LLC , t o retai n all books , records , an dothe r sourc e an d summary documentatio n t o suppor t claim s for

payment , an dt o preserv e an dmaintai n suc h documentatio n i n amanne r tha t readil y permit s it s audi t

an dexaminatio n b y representative s o f th e Department
. Suc h documentatio n shal l b e retaine dfo r seve n year s o r

unti l th e Departmen t indicate s that

th e record s may b e destroyed , whicheve r come s first

. Copie s o f

flight log s for aircraf t sol do r dispose do f

mus t b e retained

. Th e carrie r

may forfei t

it s compensatio n for

an y clai mtha t i s not supporte dunde r

th e term s o f

thi s order ; 3
. W e fin dtha t

Alask aSeaplan e Service , LLC , continue s t o b e fit, willin g an dabl e t o operat e a s acertificate dcarrie r

an dcapabl e o f

providin g reliabl e essentia l ai r servic e at

Angoo n an d Tenakee , Alaska ; 4
. Thi s docke t

wil l remai n ope n unti l further orde r o f th e Department ; an d 5
. W e wil l serv e copie s o f thi s orde r

o n th e Offic e o f

Statewid e Aviatio n o f

th e Alask a Departmen t

o f Transportatio n an dPubli c Facilities , an dAlask aSeaplan e Service , LLC
. By :

Susa n L
. Kurlan d Assistan t Secretary for Aviatio n an dInternationa l Affair s (SEAL ) A n electroni c versio n o f thi s documen t

i s availabl e o n th e Worl dWid e We b a t http://www.regulations.go v

### Appendi x A


# \\r /

Grea t Circl e Mile s t

o Junea u (JNU) Angoo n (AGN ) Tenake e (TKE ) Hoonah , HN H Pelica n (PEC ) Elfi n Cov e (ELV ) Gustavu s (GST ) 5 9

5 0 3 5 6 7 6 4 4 1 Excursio n Inle t

(EXI ) 3 2 Haine s (HNS ) Skagway (SGY ) 7 0

8 1Appendi x B

Annua l Subsid y Nee d a t Angoo n an d Tenakee , Alask a

Docke t 2006-2554 2

Aircraf t Typ e Bloc k Hour s Departure s Passenge r3 / Freigh t Mai l Tota l Revenu e Angoo n DHC- 2 51 3 1 / 70 0 1 / $178,08 3 $27,74 3 $51,22 2 $257,04 8 Tenake e

DHC- 2 30 4 2 / 45 6 2 / $60,63 4 $15,13 6 $27,34 0 $103,11 0 Tota l

DHC- 2 81 7 1,15 6 $238,71 7 $42,87 9 $78,56 2 $360,15 8

Cos t @ $785.15/hr

. $402,78 2 $238,68 6 

### $641,46 8 Annua l Subsid y 

### $145,73 4 $135,57 6 $281,31 0

1 / Pea k 1 8 week

s x 2 0 flight s i n eac h directio n x 4 4 min/6 0 • • Off-Pea k 34 week

s x 1 0 flight s i n eac h directio n x 4 4 min/6 0 •

2 / Pea k 1 8 week

s x 1 4 flight s i n eac h directio n x 4 0 min/6 0 = Off-Pea k 34 week

s x 6 flight s i n eac h directio n x 4 0 min/6 0 = BIk

. Hrs

. 26 4 24 9 51 3
BIk

. Hrs

. 16 8 13 6 30 4 Flight s

36 0 34 0 70 0 Flight s 25 2 20 4 45 6 3 / Base d o n $106.2 5 averag e passenge rfare

.

## Appendix C- 1 Alask aSeaplane Service , LLC , Essentia l Ai r Servic e to b e Provide dto Angoon , Alaska , Docket s OST-2006-2554 2 Effective Period : Februar

y 1 , 2011 , through Januar

y 31,2015
. ScheduledService : Te

n nonstop roundtrip s pe

r wee k i n th e pea k an dseve n nonstop roun

dtrip s pe r wee k i n th e off-pea

k t o Juneau
. Aircraft : DeHavaillandBeaver , six seat s Weekl y Ceiling : $2,80 3 1 Rat e pe r Eligibl e Flight : Peak , 1 8 weeks , $140.15 ; Off-Peak, 3 4 weeks , $200,21 2
Note : Th e carrie r

understand s tha t

i t ma y forfei t it s compensatio n for

an y flight s that

i t doe s no t operat e i n conformanc e wit h th e term s an dstipulation s o f th e rat e order , includin g th e servic e plan s outline din th e orde r an dany othe r

significan t element s o f

th e require dservice , withou t prio r approval

. Th e carrie r

understand s that

an aircraf t take-of f an dlandin g at

it s schedule ddestinatio n constitute s acomplete dflight ; absen t a n explanatio n supportin g subsid y eligibility for aflight that ha s no t bee n completed , suc h a s certai n weathe r cancellations , onl y complete dflight s ar e considere deligibl e fo r subsidy

. I n addition , if

th e carrie r

doe s no t schedul e o r

operat e it s flight s in ful

l conformanc e wit

h th e orde r

fo r asignifican t

period , i t ma y jeopardiz e it s entir e subsid y clai mfor th e perio di n question

. If th e carrie r

contemplate s an y suc h change s beyon d th e scop e o f

th e orde r durin g th e applicabl e perio do f thi s rate , i t

mus t firs t notif y th e Offic e o f

Aviatio n Analysi s i n writin g an dreceiv e writte n approva l fro mth e Departmen t t o b e ensure do f

full compensation

. Shoul dcircumstance s warrant , th e Departmen t

ma y locat e an dselec t

areplacemen t

carrie r t o provid e servic e o n thes e routes
. Th e carrie r mus t complet e al l flights tha t

ca n b e safel y operated ; flights tha t overfl y point s fo

r lac k o f traffi c wil l no t

b e compensated

. I n determinin g whethe r

subsid y paymen t

fo r adeviatin g flight

shoul db e adjuste do r

disallowed , th e Departmen t wil l conside r th e exten t

t o whic h th e goal s o f

th e progra mar e me t

an dth e exten t

o f acces s t o th e nationa l ai r transportatio n syste mprovide dt o th e community

. I f th e Departmen t

unilaterally , eithe r

partiall y o r

completely , terminate s o r reduce s payment s for

servic e o r

change s servic e requirement s a t

aspecifi c locatio n provide dfor unde r thi s order , then , at

th e en do f

th e perio dfo

r whic h th e Departmen t

doe s mak e payment s i n th e stipulate damount s o r at th e stipulate dservic e levels , th e carrie r ma y cease t o provid e servic e t o that

specifi c locatio n withou t regar dt o an y requiremen t for notic e o f suc h cessation. Thos e adjustment s i n th e level s o f

subsid y and/o r

servic e tha t

ar e mutuall y agree dt o i n writin g b y th e Departmen t an dcarrie r

d o no t constitut e atota l o r

partia l reductio n o r

cessatio n o f

payment
. Subsid y contrac t

ar e subjec t

to , an dincorporat e b y reference , relevan t statute s an dDepartmen t

regulations , a s the y ma y b e amende dfro mtim e t o time

. However , any suc h statutes , regulations , o r amendment s theret o shal l no t operat e to controver t

th e foregoin g paragraph

. Fund s ar e no t

currentl y availabl e fo

r performanc e unde r

thi s orde r

beyon dDecembe r

3 , 2010
. Th e Government' s obligatio n fo

r performanc e unde r

thi s orde r

beyon dDecembe r

3 , 2010 , i s subjec t

t o th e availability o f

appropriate d fund s fromwhic h paymen t fo r service s ca n b e made

. N o lega l liability o n th e par t o f th e Governmen t

for an y paymen t ma y aris e for performanc e unde r

thi s orde r

beyon dDecembe r

3 , 2010 , unti l fund s ar e mad e availabl e t o th e Departmen t

for performance

. I f

fund s ar e no t

mad e availabl e for

performanc e beyon dDecembe r 3,2010 , th e Departmen t

wil l provid e notic e i n writin g t o th e carrier

. Al l claim s for

paymen t mus t b e submitte dwithi n 6 0 day s o f th e las t day o f servic e provide dunde r

thi s order

.

1 $145,73 4 annual subsid y - f 5 2 weeks

. 2 Peak : $2,803- f

2 0 flights; Off-Peak : $2,80 3 ^ 1 4 flights.

### Appendi x C- 2 Alask aSeaplan e Service , Inc. , Essentia l Ai r Servic e t o b e Provide dt o Tenakee , Alaska , Docket s OST-2006-2554 2 Effectiv e Period : February 1 , 2011 , throug h Januar y 31 , 2015
. Schedule dService : Seve n nonsto p roun dtrip s pe r wee k i n th e peak

an dthre e nonsto p roun dtrip s pe r wee k i n th e off-pea

k t o Juneau
. Aircraft : DeHavaillan dBeaver , si x seat s Weeklv Ceiling: $2.607 ' Rat e pe r Eligibl e Flight : Peak , 1 8 weeks , $186.21 ; Off-Peak , 3 4 weeks , $434.50 ^ Note : Th e carrie r

understand s tha t

i t ma y forfei t it s compensatio n for

an y flights tha t

i t doe s no t operat e i n conformanc e wit h th e term s an dstipulation s o f th e rat e order , includin g th e servic e plan s outline di n th e orde r an dany othe r

significan t element s o f

th e require dservice , withou t prio r approval

. Th e carrie r

understand s that

an aircraf t take-of f an dlandin g at

it s schedule ddestinatio n constitute s acomplete dflight; absen t a n explanatio n supportin g subsid y eligibility fo r aflight tha t ha s no t bee n completed , suc h a s certai n weathe r cancellations , onl y complete dflights ar e considere deligibl e fo r subsidy

. I n addition , i

f th e carrie r

doe s no t schedul e o r

operat e it s flights i n full conformanc e wit h th e orde r

for asignifican t

period , i t ma y jeopardiz e it s entir e subsid y clai mfor th e perio di n question

. I f th e carrie r

contemplate s any suc h change s beyon d th e scop e o f

th e orde r durin g th e applicabl e perio do f thi s rate , i t

mus t first notif y th e Offic e o f

Aviatio n Analysi s in writin g an dreceiv e writte n approva l fromth e Departmen t t o b e ensure do f

ful l compensation

. Shoul dcircumstance s warrant , th e Departmen t

ma y locat e an dselec t

areplacemen t

carrie r t o provid e servic e o n thes e routes
. Th e cartie r mus t complet e al l flights tha t

ca n b e safel y operated ; flights that overfl y point s fo

r lac k o f traffi c wil l no t

b e compensated

. I n determinin g whethe r

subsid y paymen t

for adeviatin g flight

shoul db e adjuste do r

disallowed, th e Departmen t wil l conside r th e exten t

t o whic h th e goal s o f

th e progra mar e me t

an dth e exten t

o f acces s t o th e nationa l ai r transportatio n syste mprovide dt o th e community

. I f th e Departmen t

unilaterally , eithe r

partiall y o r

completely , terminate s o r reduce s payment s for

servic e o r

change s servic e requirement s at

aspecifi c locatio n provide dfor unde r thi s order , then , at

th e en do f

th e perio dfor

whic h th e Departmen t

doe s make payment s i n th e stipulate damount s o r a t th e stipulate dservic e levels , th e cartie r ma y cease t o provid e servic e t o tha t

specifi c locatio n withou t regar dt o any requiremen t fo r notic e o f suc h cessation

. Thos e adjustment s i n th e level s o f

subsid y and/o r

servic e tha t

ar e mutuall y agree dt o i n writin g b y th e Departmen t an dcartie r

d o no t constitut e atota l o r

partia l reductio n o r

cessatio n o f

payment
. Subsid y contrac t

ar e subjec t

to , an dincorporat e b y reference , relevan t statute s an dDepartmen t

regulations, a s the y ma y b e amende dfromtim e t o time

. However , any suc h statutes , regulations , o r amendment s theret o shal l no t operat e t o controvert

th e foregoin g paragraph

. Fund s ar e no t

curtentl y availabl e for

performanc e unde r

thi s orde r

beyon dDecembe r

3 , 2010
. Th e Government' s obligatio n for

performanc e unde r

thi s orde r

beyon dDecembe r

3,2010 , i s subjec t

t o th e availability o f

appropriate d fund s fromwhic h paymen t for service s ca n b e made

. N o legal liability o n th e par t o f th e Governmen t

fo r any paymen t ma y aris e for performanc e unde r

thi s orde r

beyon dDecembe r

3 , 2010 , unti l fund s ar e mad e availabl e t o th e Departmen t

for performance

. I f

fund s ar e no t

mad e availabl e fo r

performanc e beyon dDecembe r 3 , 2010 , th e Departmen t

wil l provid e notic e i n writin g t o th e carrier

. Al l claim s fo

r paymen t mus t b e submitte dwithi n 6 0 day s o f th e las t day o f servic e provide dunde r

thi s order

.

' $135,57 6 annual subsid y - ^ 5 2 weeks

. 2 Peak : $2,607 ^ 1 4 flights; Off-Peak : $2,60 7 •= • 6 flights.