Order 2010

- 8

- 8 Served: August 13 , 2010



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 13 th day of August, 2010

ORDER SOLITICITING PROPOSALS

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

essential air service (EAS) at Pendleton, Oregon, for a new two

- year period, beginning January 1, 2011, with or without subsidy. (See Appendix A for a service area map )

. Carriers should file their proposals no later than September 1 4

, 2010.

Background By Order 2008

- 10

- 25

, October 21 , 2008, the Department selected Alaska Juneau Aeronautics, Inc., d/b/a SeaPort Airlines (SeaPort) , to provide three nonstop round trips a day (21 a week)

between Pendleton and Portland with 9

- seat Pilatus

- PC

- 12 aircraft

, for the two

- year period beginning when the carrier inaugurate d full service, for a first year subsidy rate of $1,566,729 and $1,608,394 for the s econd

. Request for Proposals As the end of the current contract approach es , we are requesting proposals from carriers interested in providing service at Pendleton

, with or without subsidy, for the two

- year period beginning January 1, 2011 . Carriers should file their proposals no later than September 1 4

, 2010

. Staff will then docket the proposals, thereby making them public, and direct each carrier to serve a copy of its proposal on the civic parties and other applicants. Shortly afterwards, we will provid e a summary of the proposals to the communit y and ask them to submit their final

comments

. We will give full consideration to all proposals that are timely filed. 1

1 Carriers should not expect the Department to accept late fillings

. In cases where a carrier proposes to provide

essential air service without subsidy and we determine that service can be reliably provided without such compensation, we do not proceed with the carrier

- selection case. Instead, we simply rely on that carrier’s su bsidy

free service as proposed.

Essential Air Service at

PENDLETON, OREGON

Under 49 U.S.C. 41731 et seq

. Docket DOT

- OST

- 2004

- 19934- 2

-

Interested carriers should prepare their proposals with every expectation that their initi al proposals will represent their final and only proposals. However, 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 re

- solicit a new round of proposals. However, negotiation or rejection are only an occasional exception to the rule.

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 for their proposals. 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 t o 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 thei r evaluation by the affected communities and the Department. 2

With specific respect to Pendleton , the Department expects proposals consisting of either three nonstop round trips a day (21 a week) with 9

- passenger aircraft or two daily round trips (12 a

we ek) with 15

- seat or larger aircraft to Portland , the hub that the community has historically preferred . We would also entertain proposals to a different hub such as Seattle or San Francisco,

or additional frequencies if Pendleton would be served in conj un ction with another community

. Such service is generally consistent with what the communit y currently receive s , and fully

satisfies its essential air service requirements. We encourage proposals that meet those requirements in an efficient manner. Carrie rs are also welcome to propose more than one service option, if they choose; they need not limit themselves to those requirements if they envision other, potentially more a ttractive service possibilities with subsidy require ments that remain competitive.

We encourage the communit y and air carriers to work together in advance of the due date for proposals to craft a service pattern that is desirable to the communit y and meets the operational needs of the airline interested in submitting a proposal.

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.

2 In selecting a carrier to provide subsidized essential air service, 49 U.S.C. 41733(c)(1) directs us to consider four factors: (a) scheduled service reliability; (b) contractual and marketing arrangements with a larger carrier to ensure service beyond the hub; (c) interline arrange ments that the applicant has made with a larger carrier at the hub; and (d) community views, giving substantial weight to the views of the elected officials representing the users. 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

.- 3

-

Servi ce and Traffic History In order to assist carriers in making their passenger and revenue forecasts, we have included historical traffic for Pendleton in Appendix B. During the year ended December 31, 2009

, Pendleton averaged 12 enplanements a day. Howeve r, we note that Pendleton averaged 20 or more enplanements per day in the three previous years, and exceeded 40 per day in the early

2000s.

Other Carrier Requirements The Department is responsible for implementing various Federal statutes governing lobbyi ng activities, drug

- free workplaces, and nondiscrimination. 3 Consequently, all carriers receiving Federal subsidy for essential air service must certify that they are in compliance with Department regulations regarding drug

- free workplaces and nondiscrimi nation, 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. Because the Department is prohibited from paying subsidy to carrier s that do not submit these documents, all carriers that plan to submit proposals involving subsidy should be aware that the selected carrier will be required to complete the required certifications. Interested carriers requiring more detailed

information regarding these requirements should contact the Office of Aviation Analysis at (202) 366

- 5903. 4

Community and State Comments

The communit y and State are welcome to submit comments at any time. We encourage prospective applicants to contact the communities before they submit their proposals so that they can tailor them to the communities’ needs, as they will not be able to amend them after the due date. As noted earlier, we will provide a summary of the proposals to the civic parties and ask

the m to submit thei r final comments shortly after September 1 4 , the end of the 30

- day period for carrier proposals.

This order is issued under authority delegated in 49 CFR 1.56a(f).

ACCORDINGLY, 1. We request that carriers interested in providing essential air service at Pendleton, Oregon

, submit their proposals, with or without subsidy requests, no later than September 1 4

, 2010. The proposals should be e

- mailed to: EAS@dot.gov with the title “Proposal to Provide Essential Air

Service at Pendleton, Oregon

, ” with the docket number corresponding to the communit ies as shown on the first page of this order; 5

3 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 sus pension (non

- procurement) and government

- wide requirements for drug

- free workplace (grants).

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

5 Questions regarding filings in response to this order may be d irected to Brian Swanson at (202) 366

- 5392 or brian.swanson@dot.gov

.- 4

-

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

3. We will serve copies of this order on the communit y and the parties listed in Appendix D.

Persons entitled to petition the Department for review of this order under the Department’s Regulations, 14 CFR 385.50, must file such petition s 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 shall not preclude

its effectiveness.

By:

TODD M. HOMAN

Director Office of Aviation Analysis

(SEAL)

An electronic version of this document is available

at http://www.regulations.govAppendix A



### PENDLETON, OREGON
AND SURROUNDING COMMUNITIESAppendix B

Historical Enplanements 1
Pendleton, Oregon

Notes: 1. Source: USDOT Bureau of Transportation Statistics, Form T

- 100. 2. Origin

- destination passengers divided by two. 3. Average annual enplanements divided by 313 effective annual service days, except for annu al periods ended 12/31/2000, 2004 and 2008 (314 effective annual service days). 

### Year Ended Recorded Passengers Average Annual

Enplanements 2 

### Average Enplanements

Per Service Day 3



### 31-Dec-00 27,395 13,698 43.6

31-Dec-01 26,555 13,278 42.4

31-Dec-02 20,742 10,371 33.1

31-Dec-03 17,518 8,759 28.0

31-Dec-04 8,836 4,418 14.1

31-Dec-05 11,428 5,714 18.3

31-Dec-06 12,429 6,215 19.9

31-Dec-07 12,459 6,230 19.9

31-Dec-08 14,451 7,226 23.0

31-Dec-09 7,531 3,766 12.0Appendix 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, 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 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; flight s 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 ex tent 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 require ment 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 ar e 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 perform ance under this solicitation beyond [DATE] is contingent upon the availability of appropriated funds from which payment for ser vices can be made. No legal liability on the part of the Department 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 performanc e 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 se rvice provided

under this order.Appendix D

SERVICE LIST

Air Greco, d/b/a Wings A ir, Aaron Goerlich Kenmore Air, Tim Brooks Air Greco, d/b/a Wings Air, Charles Mintz Mesa Air Group, Jonathan Ornstein Air Greco, d/b/a Wings Air, Robert Rupard Mesa Air Group, Michael Lotz Air Sunshine, Mirmohammad Adili Mesa Air Group, Mike Holcomb Air Wisconsin, Barbara Jones Mesaba, Max Shemesh Alaska Airlines, Jeff Cole Mesaba, John Spanjers Alaska Airlines, Sandy Sinick Midwest Airlines, Anthony Intravia Allegiant Air, Robert Ashscroft Midwest Airlines, David Reeve Alliance Air, Paul Berliner Midwest Airlines, Greg Aretakis American Airlines, Carl Nelson MN Aviation, Jose Maldonado American Eagle, Jeff Hartz Multi Aero, Darnea Bemidji Aviation, Arlen Rinkenberger Multi Aero, Shane Storz Bemidji Aviation, Cori Rude NYDC, Henok Araya Cape Air, Andrew Bonney Northwest, Aaron Murray Cape Air, Dan Wolf Northwest, Tim McDonald Cape Air, J. Flaherty OST, Dennis DeVany, Renee Williams, Caribbean Sun Airlines, John Rupert OST, Kevin Adams, Brian Swanson Colgan Air, Mike Colgan Pacific Wings, Frank Ford Colgan Air, Kevin Scott Pacific Wings, Greg Kahlstorf CommutAir, Andy Price Pinnacle Airlines, Joe Williams CommutAir, Joel Raymond Pinnacle Airlines, Phil Reed Continental, Bruce Keiner Public Charters, Jim Gallagher Continental, Dan Weiss Salmon Air, Dan Schroeder Continental, Lorry Halloway Salmon Air, JoAnn Wolters Delta Air Lines Amy Martin Scenic, Mary Schneider Delta Air Lines, Jeff Morgan Scenic, Mitzi Daines Delta Air Lines, Dan Shuman Seaborne Airlines, Wayne D’Amico

Delta Air Lines, Joe Esposito SeaPort Airlines. Rob McKinney Delta Air Lines, Sascha Vanderbellen Shuttle America, Jerry Balsano Delta, Karen Zachary SkyWest, Eric Christensen Executive Airlines, Kate Soled SkyWest, Michael Thompson Great Lakes Airlines, Chuck Howell Sovereign Air, Bob Karns Great Lakes Airlines, Doug Voss Sovereign Air, Lois R. Barton Great Lakes Airlines, Greg Stephens Tradewind, Eric Zipkin Gulfstream, Dave Hackett Trans States, Bill Mishk Gulfstream, Mickey Bowman Trans States, Gerry Wigmore Gulfstream, T. Cooper United, Alicia Gabriel Homeland Security, Michael Duffy United, James Starnes Homeland Security, Randy Webb US Airways, Howard Kass Horizon Air, Dan Russo US Airways, Jason Reisinger Horizon Air, Jennifer Thompson US Airw ays, Benjamin Slocum Horizon Air, Jeff Cole Vintage Props and Jets, Nate Vallier ICEPR, Luis Irizarry Wings of Alaska, Bob Jacobsen Island Air Charters, Linda House Wings of Alaska, Michelle Donohue
Jet Air, Daniel Wolford Eastern Oregon Regional Airport, Larry Dalrymple
City of Pendleton, The Honorable Phillip Houk