Order: 2011-1-23

 Served: January 28, 2011

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 28th day of January, 2011

Essential Air Service at

WATERTOWN, SOUTH DAKOTA

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

DOCKET DOT-OST-2001-10644

 

ORDER REQUESTING PROPOSALS

Summary

By this order, the Department is requesting proposals from airlines interested in providing 

essential air service (EAS) at Watertown, South Dakota, for the two-year period beginning 

August 1, 2011, with or without subsidy. Proposals are due by March 2, 2011. (See 

Appendix A for a map.)

Background

By Order 2009-7-15, July 16, 2009, the Department selected Mesaba Aviation, Inc., operating 

as Delta Connection (Mesaba), to provide EAS at Watertown for the period from

August 1, 2009, through July 31, 2011, for an annual subsidy of $1,338,321 for 14 nonstop

round trips per week to Minneapolis/St. Paul International Airport (Minneapolis). 

 

Request for Proposals 

As the end of the current rate term approaches, we are here requesting proposals from carriers 

interested in providing service at Watertown, with or without subsidy support, for the two-year 

period beginning August 1, 2011. Carriers should file their proposals no later than March 2. 

After that date, our staff will docket proposals, thereby making them public, and shortly 

afterwards will provide a summary of the proposals to the community and ask them for their 

final comments. We will give full consideration to all proposals filed in a timely manner. 

Interested carriers should prepare their proposals with every expectation that their initial 

proposals will also be their final and only proposals. We retain the discretion to negotiate 

proposals with carriers when we deem it desirable. We also retain the discretion to reject 

outright all unreasonable or unrealistic proposals and solicit a new round of proposals.
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We are here providing interested carriers with some basic information to serve as guidance 

when they prepare their proposals, but we will not prescribe a precise format. We expect 

proposals to adequately describe the service being proposed and the annual amount of subsidy 

being requested. The applicants can make their own judgments as to the level of detail they 

wish to present; however, they might want to include proposed schedules as well as supporting 

data for their subsidy requests, such as projected block hours, revenues and expenses. We 

strongly encourage clear, well-documented proposals that will facilitate their evaluation by the 

affected community and the Department.1

Proposals should provide sufficient capacity to accommodate historical levels of traffic. In 

order to assist carriers in developing traffic and revenue projections for their proposals, we 

have provided a summary of historical passengers in Appendix B. During the year ended 

September 30, 2010, an average of 22 passengers a day were enplaned at Watertown. We 

expect service levels that are consistent with what the community currently receives, with

service to Minneapolis, or any hub that offers access to the national air transportation system

utilizing 15-seat or larger aircraft. With specific respect to Watertown, for proposals with 30 to 

34-seat aircraft, the Department expects proposals for two round trips a day (12-14 a week). 

For proposals with 19-seat aircraft, we would expect proposals for three round trips a day (18-

21 a week). We would also entertain proposals with 8/9-seat aircraft and additional 

frequencies. Should the community agree to aircraft with fewer than 15 passenger seats, in 

effect waiving their right to 15-seat or larger aircraft, we would consider the waiver to apply 

only to the two-year carrier-selection at hand, i.e. we would not assume that the community 

would waive their rights for all time. As always, we will formally solicit the community’s

views on any service options we receive before making a long-term airline selection decision. 

Airlines are also welcome to propose more than one option, if they choose; they need not limit 

themselves to those requirements if they envision other, potentially more attractive service 

possibilities -- different hubs, frequency, equipment, or length of contract, for example -- with 

subsidy requirements that remain competitive. The community and air carriers are encouraged 

to work together in advance of the due date for proposals to craft a service pattern that is 

desirable to the community and meets the operational needs of the airlines.

New Filing Procedures 

Carrier proposals should be submitted to the Department with all materials merged into a single 

document. In addition, because the document will be published on Regulations.gov, each page 

should be formatted to be viewed online.

 1 In selecting a carrier to provide subsidized essential air service, 49 U.S.C. 41733(c)(1) directs us to consider 

four 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; and (4) community views. In addition, the 

Consolidated Appropriations Act, 2008, Public Law 110-161, 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. Interested carriers should also be aware that our general 

provisions governing EAS will be included in the selection order as part of our authorization of subsidy for the 

selected service. Appendix C of this order contains those general provisions.
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Other Carrier Requirements 

The Department is responsible for implementing various Federal statutes governing lobbying 

activities, drug-free workplaces and nondiscrimination.2 Consequently, all carriers receiving 

Federal subsidy to support essential air service must certify that they are in compliance with 

Department regulations regarding drug-free workplaces and nondiscrimination, and those 

carriers whose subsidies exceed $100,000 over the life of the rate term must also certify that 

they are in compliance with the regulations governing lobbying activities. All carriers that plan 

to submit proposals involving subsidy should submit the required certifications along with their 

proposals. Interested carriers requiring more detailed information regarding these 

requirements, as well as copies of the certifications, should contact the Office of Aviation 

Analysis at (202) 366-5903. The Department is prohibited from paying subsidy to carriers that 

do not submit these documents.3

Community and State Comments 

Civic officials are welcome to submit comments on the proposals at any time. As noted earlier, 

we will provide a summary of the proposals to the civic parties and ask them to submit their 

final comments shortly after March 2, the due date for carrier proposals.

This order is issued under authority delegated in 49 CFR 1.56a(f) and re-delegated to the 

Director, Office of Aviation Analysis.

ACCORDINGLY, 

1. We request that carriers interested in providing essential air service at Watertown, South 

Dakota, submit their proposals, with or without subsidy requests, no later than March 2, 2011. 

The proposals should be emailed to: EAS@dot.gov with the title “Proposal to Provide 

Essential Air Service at Watertown, South Dakota,” Docket DOT-OST-2001-10644;4

2. This docket will remain open until further order of the Department; and

3. The Department will serve a copy of this order on the mayor and airport manager of 

Watertown; Mesaba Aviation Inc. (Mesaba), and the parties listed in Appendix D.

Persons entitled to petition the Department for review of this order under the Department’s 

Aviation Economic Regulations, 14 CFR 385.50, must file such petitions within ten (10) days 

after the date of service of this order.

 2 The regulations applicable to these areas are: (1) 49 CFR Part 20 – New restrictions on lobbying; (2) 49 CFR 

Part 21 – Nondiscrimination in federally-assisted programs of the Department of Transportation – Effectuation of 

title VI of the Civil Rights Act of 1964; 49 CFR Part 27 – Nondiscrimination on the basis of disability in programs 

and activities receiving or benefiting from Federal financial assistance; and 14 CFR Part 382 – Nondiscrimination 

on the basis of disability in air travel; and (3) 49 CFR Part 29 – Government-wide debarment and suspension (nonprocurement) and government-wide requirements for drug-free workplace (grants).

3 The certifications are also available on the web at http://ostpxweb.dot.gov/aviation/index.html.

4 Questions regarding filings in response to this order should be directed to Michael Martin at 202-366-6494, or 

via email at michael.f.martin@dot.gov.
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This order will be effective immediately, and the filing of a petition for review shall not 

preclude its effectiveness.

By:

TODD M. HOMAN

Director

Office of Aviation Analysis

(SEAL)

An electronic version of this document is available online at

www.regulations.gov
Appendix A

Area Map
APPENDIX B

Historical Origin-Destination Plane Traffic1

Watertown, South Dakota

Quarter Year Deplanements Enplanements

Total 

Traffic

Enplanements 

per Day

4 2007 1,141 1,108 2,249 14

1 2008 1,155 1,257 2,412 16

2 2008 1,301 1,217 2,518 16

3 2008 1,520 1,278 2,798 18

Annual 

Totals 5,117 4,860 9,977 16

4 2008 1,138 1,214 2,352 15

1 2009 1,170 1,266 2,436 16

2 2009 1,252 1,304 2,556 16

3 2009 1,555 1,849 3,404 22

Annual 

Totals 5,115 5,633 10,748 17

4 2009 1,403 1,401 2,804 18

1 2010 1,634 1,688 3,322 22

2 2010 1,678 1,712 3,390 22

3 2010 1,998 2,096 4,094 26

Annual 

Totals 6,713 6,897 13,610 22

 1 Source: USDOT Bureau of Transportation Statistics, TransStats Intermodal Database, Schedule T-100.
Appendix C

Example of General Terms and Conditions for Essential Air Service

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 eligibility 

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 these rates, it must first notify the Office of 

Aviation 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 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 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 amounts 

or at the stipulated service levels, the carrier may cease to provide service to that specific 

location without regard 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 payment.

Subsidy contracts 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 are not currently available for performance under this solicitation beyond [DATE]. The 

Department’s obligation for performance under this solicitation beyond [DATE], is contingent 

upon the availability of appropriated 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 [DATE], until funds are made available to the Department for performance. If 

funds are not made available for performance beyond [DATE], the carrier will receive notice in 

writing by the Department.

All claims for payment must be submitted within 60 days of the last day of service provided 

under this order.
Appendix D

Scheduled Air Carriers, Contiguous US and Puerto Rico

Air Greco/Wings Air

Air Sunshine, Inc.

Air Sunshine, Mirmohammad Adili

Air Wisconsin, Annette Daly 

Air Wisconsin, Jim Rankin

Airline Associates, Bill Mishk

Alaska Airlines, Jeff Cole

Alaska Airlines, Sandy Sinick

Allegiant Air, Brian Davis

American Airlines, Carl Nelson

American Eagle, Jeffrey Hartz

Bemidji Aviation, Cori Rude 

Bemidji Aviation, Arlen Rinkenberger

Cape Air, Andrew Bonney 

Cape Air, Dan Wolf 

Cape Air, J.Flaherty

Colgan Air, Kevin Scott

Colgan Air, Mike Colgan 

CommutAir, Andy Price

CommutAir, Joel Raymond

Consultant, Robert Silverberg

Continental, Bruce Keiner

Continental, Dan Weiss

Continental, Lorry Halloway

Delta, Anthony Canitano

Delta, Dan Shuman

Delta, Jeff Morgan 

Delta, Joe Esposito 

Delta, Karen Zachary 

Delta, Kristal Murphy

Delta, Sascha Vanderbellen

DHS, Bill Ragan

DHS, David Bernier

Era Aviation, Mike Lenorman

Executive Airlines, Kate Soled

Frontier Flying, Bob Hajducovich

GemAir/Salmon Air, Dan Schroeder

GemAir/Salmon Air, JoAnn Wolters

Great Lakes, Chuck Howell

Great Lakes, Doug Voss 

Great Lakes, Greg Stephens

Gulfstream, Dave Hackett

Gulfstream, Mickey Bowman

Gulfstream, T. Cooper 

Horizon Air, Dan Russo

Horizon Air, Jennifer Thompson

Horizon Air, Mike McQueen

Horizon, Jeff Cole

ICEPR, Luis Irizarry

Intrepid Interntl Air, Rick Eyk

Island Air Charters, Linda House

Jet Air, Daniel Wolford

Kenmore Air, Tim Brooks 

Mesa Air, Michael Lotz 

Mesaba, John Spanjers

Mesaba, Max Shemesh 

Midwest Airlines, Greg Aretakis

MN Aviation, Jose Maldonado 

Multi Aero, Darnea

Multi Aero, Shane Storz

Northwest Airlines, Aaron Murray

Northwest, Tim McDonald 

NYDC, Henok Araya

OST, Brian Swanson

OST, Dennis DeVany

OST, Kevin Adams

OST, Kevin Schlemmer

OST, Michael Martin

OST, Renee Williams

Pacific Wings, Greg Kahlstorf

PenAir, Danny Seybert

PenAir, Scott Bloomquist

Pinnacle Airlines, Joe Williams 

Pinnacle Airlines, Phil Reed

Planemasters, Inc., John Kessler

Planemasters, Inc., Paul Berliner

Planemasters, Inc., Todd DeSimone

Public Charters, Jim Gallagher

Scenic, Mary Schneider

Scenic, Mitzi Daines

SeaPort/Wings of Alaska, Jim Day 

SeaPort/Wings of Alaska, Nate Vallier

Seaport/Wings of Alaska, Rob McKinney

Shuttle America, Jerry Balsano 

SkyWest, Eric Christensen

SkyWest, Michael Thompson

SkyWest, Steve Hart

Sovereign Air, Bob Karns

Sovereign Air, Lois R. Barton

Tradewind, Eric Zipkin 

Trans States, Fred Oxley

Trans States, Gerry Wigmore

United, Alicia Gabriel

United, James Starnes

US Airways, Benjamin Slocum

US Airways, Howard Kass

US Airways, Jason Reisinger

Warbelows Air Ventures, Art Warbelow