Proposal Under the Small Community 

Air Service Development Program

Docket:	 	 	 	 	 	 	 	 DOT-OST-2014-0113 

Sponsor:	 	 	 	 	 	 	 	 Cheyenne Regional Airport Board 

									 Cheyenne, WY 

DUNS:	 	 	 	 	 	 	 	 05-811-1790 

Congressional District Code:	 	 	 	 WY-01 

Tax ID:	 	 	 	 	 	 	 	 83-0253531 

Contact:	 	 	 	 	 	 	 	 Jim Schell 

	 	 	 	 	 	 	 	 	 Deputy Director of Aviation 

4000 Airport Parkway 

									 Cheyenne, WY 82001 

(307) 634-7071

July, 2014

 Cheyenne Regional Airport 
2

Summary Information	 	 	 	 	 	 	 	 	 	 3 

Proposal	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 7 

Air Service Challenges/History		 	 	 	 	 	 8 

Plan And Overview	 	 	 	 	 	 	 	 	 	 	 17 

Priority Selection Criteria	 	 	 	 	 	 	 	 	 20 

Secondary Selection Criteria		 	 	 	 	 	 	 22 

Previous Project Goals	 	 	 	 	 	 	 	 	 	 23 

Table of Contents
Summary Information

3
Summary Information

4
Summary Information

5
Summary Information

6
Proposal

7

Cheyenne’s current air service is threatened. Changes in the airline 

environment have caused fares to increase; capacity and reliability to drop. 

These changes, largely out of control of Cheyenne Regional Airport, are 

contributing to a severe drop in passenger enplanements at the airport. 

Cheyenne Regional Airport has a long history of enplaning well in excess of 

10,000 passengers annually without subsidy. However, for the first four months 

of 2014, passengers at CYS dropped nearly 50% from the same period in 2013. 

Cheyenne enplanements will fall under 10,000 for the first time in over 20 years 

in 2014, unless drastic changes to air service occur. Cheyenne Regional Airport 

is taking a proactive approach to preventing this from happening. 

 Should Cheyenne lose air service for whatever reason, Cheyenne cannot 

apply to the Essential Air Service Program for relief, as no new cities are eligible 

for subsidy. Cheyenne is the most populous region and state capitol of 

Wyoming, and preservation of affordable air service is essential to the region’s 

economy. 

Therefore, Cheyenne Regional Airport is applying for a Small Community 

Air Service Development Grant in the amount of $200,000, combined with state 

and local public and private funds to establish a minimum revenue guarantee to 

secure and market new airline service to a large hub or airport with substantial 

regional draw. Total funds available for this minimum revenue guarantee are 

$1 million, including in-kind contributions, fee waivers and marketing funds. 

Eligibility: 

Cheyenne Regional Airport is eligible to apply for the Small Community Air 

Service Development Program. 

Cheyenne Regional Airport is an underserved and under-utilized airport, 

seeking funds to increase the frequency of airline service and to reduce airfares 

to the largest community in the State of Wyoming. 

As of calendar year 1997, Cheyenne Regional Airport was not larger than 

a small hub airport. Cheyenne Regional Airport has unique characteristics and 

circumstances that demonstrate the need for grant assistance.
Air Service Challenges

8

Cheyenne currently has air service to Denver on Great Lakes Airlines. 

Cheyenne-Denver is served twice daily on Beech 1900 aircraft configured with 9 

passenger seats.

Cheyenne-Denver: July 2014

Airline Origin Dest Flt # Equip Seats Depart Arrive Freq

ZK CYS DEN 2981 BEH 9 717 752 1234.67

ZK CYS DEN 2955 BEH 9 1240 1315 ......7

ZK CYS DEN 2955 BEH 9 1300 1335 1.3456.

ZK DEN CYS 2955 BEH 9 1120 1159 ......7

ZK DEN CYS 2955 BEH 9 1150 1229 1.3456.

ZK DEN CYS 2998 BEH 9 1520 1559 .....6.

ZK DEN CYS 2998 BEH 9 1755 1834 123.5..

ZK DEN CYS 2959 BEH 9 1947 2022 ......7

The current schedule represents a drastic reduction in both 

frequency and capacity from historic levels. Seats Per Day Each Way

0

35

70

105

140

2004

20052006

2007

20082009

2010

2011

2012

2013

Jan 2014

Feb 2014

Mar 2014

Apr 2014

May 2014

Jun 2014

Jul 2014

Aug 2014

Sep 2014

Oct 2014

Nov 2014

Dec 2014

24 25 25 24 25 17 20

36

50 49

65 71

101 106

135 127

99

117

134

109 111

124

Seats Down:

65% from 2013 

74% from Peak

Departures Per Day

0

1.75

3.5

5.25

7

2004

20052006

2007

20082009

2010

2011

2012

2013

Jan 2014

Feb 2014

Mar 2014

Apr 2014

May 2014

Jun 2014

Jul 2014

Aug 2014

Sep 2014

Oct 2014

Nov 2014

Dec 2014

3.7 3.4

2.6

3.5

2.4 1.9 2.2 2.7 2.7 2.7 2.7 2.7

6.0

5.2 5.3

6.4

5.6

4.3

5.5 5.8

5.2 5.2

Flown Scheduled

Flights Down: 

64% from 2013 

70% from Peak
Air Service Challenges

9

These latest changes do not necessarily have anything to do with Cheyenne as a 

market, but environmental factors such as pilot shortages at Cheyenne’s only airline. 

In fact, Cheyenne has a history of fairly stable enplanements, despite some of 

relatively high airfares. Only recently have enplanements started to drop. Note the 

inversion between fare and passengers beginning in 2012. 

Annual Enplaned Passengers Vs. Fare - CYS

Annual Passengers

0

6,000

12,000

18,000

24,000

Average Fare

$68

$135

$203

$270

2000

2001

20022003

2004

20052006

2007

20082009

2010

2011

2012

2013

Passengers Fare

$0

$70

$140

$210

$280

2000

2001

20022003

2004

20052006

2007

20082009

2010

2011

2012

2013

Cheyenne Continental US Average

$172 $176 $166 $153 $139

$154 $144 $144 $132 $128 $132 $137 $143 $155

$267

$231

$194 $187 $175

$190 $193

$208 $199

$178

$200

$222 $222 $231

Cheyenne airfares spiked in 2013, at $267 one-way. That’s $76 and 49% more than 

the average domestic airfare for the Continental United States.Cheyenne’s airfares are now 

well above the U.S. average; a priority selection criterium.
Air Service Challenges

10

Rank Airport City 2013 Ave 

Fare

1 IYK Inyokern, CA $376

2 ISN Williston, ND $353

3 DIK Dickinson, ND $289

4 DHN Dothan, AL $284

5 ASE Aspen, CO, $272

6 JMS Jamestown, ND $272

7 CYS Cheyenne, WY $267

8 ACV Eureka/Arcata, CA $265

9 PLN Pellston, MI $264

10 CSG Columbus, GA $264

Average Continental US $176

In 2013, Cheyenne became 

one of the most expensive 

airports in the Continental U.S., 

ranking 7th most expensive out 

of 426 airports.

Cheyenne Vs. Denver Fares

100%

125%

150%

175%

200%

Average Fare

$100

$145

$190

$235

$280

2000

2001

20022003

2004

20052006

2007

20082009

2010

2011

2012

2013

Cheyenne Denver CYS as & of DEN

Cheyenne fares have never been higher compared to Denver fares. Cheyenne fares 

are now nearly TWICE the level of Denver fares. 

Rising fares and reduced frequency and capacity are making Cheyenne Regional 

Airport less competitive with Denver, the nearest large hub. Only new, competitive airline 

service will help Cheyenne reverse this trend.
11

Air Service Challenges 

Drive from Cheyenne: Distance Drive 

Time

Ave. 

Fare

N/S 

Cities

N/S Flts. 

Day

Denver 107 mi 1:45 $150 190 760

$0

$70

$140

$210

$280

$150

$189

$219 $210

$261

Cheyenne

Riverton

Sheridan

Laramie

Denver

Cheyenne’s Average Fares Are Higher Than Other 

Regional Airports.

Cheyenne’s fares 74% higher than the large hub 

nearby in Denver, and consistently higher than other 

small airports in the region.
Air Service Challenges 

12

Other 

93%

Cheyenne 

7%

Airport Usage - YE3Q13 

Cheyenne Catchment Area

Recent passenger retention analysis 

demonstrates that Cheyenne Regional 

airport retains only 7% of airline traffic from 

its natural catchment area. 

New airline service would stimulate 

competition, lower fares and attract traffic 

from the 93% of passengers who are driving 

to other airports for air travel. 

With a passenger retention rate of 

only 7%, Cheyenne’s “True Market” 

size is estimated to be nearly 

300,000 passengers annually. 

Additional airline service will help 

Cheyenne Regional Airport capture 

some portion of that lost traffic.

Estimated Current 

Cheyenne Catchment Area
Air Service Challenges

13

Cheyenne Vs. Laramie

$0

$70

$140

$210

$280

Annual O&D Passengers

0

6,000

12,000

18,000

24,000

2000

2001

20022003

2004

20052006

2007

20082009

2010

2011

2012

2013

CYS Passengers LAR Passengers CYS Fare LAR Fare

Cheyenne merely seeks to replicate what has happened a short drive away in 

Laramie, WY. When a new operator began service to Laramie, fares plummeted and 

passengers surged.

Passengers (2011 vs. 2013)

Laramie Cheyenne

+66% -53%

Fare (2011 vs. 2013)

Laramie Cheyenne

-23% +38%

In 2013, Laramie enplaned more passengers than 

Cheyenne, possibly for the first time ever. Historically, 

Cheyenne Regional Airport produced 2-3 times the annual 

passengers at Laramie, which has 1/3rd of Cheyenne’s 

population.

Population within 30 

miles

Cheyenne 99,922

Laramie 33,831
14

Reliability of air service is crucial to Cheyenne Regional Airport’s ability to 

retain passengers. Cheyenne’s proximity to Denver means that delays or 

cancellations disproportionately cause passengers to drive. And both delays and 

cancellations by Cheyenne’s current air carrier are far above U.S. averages. 

Delays into Cheyenne have run above averages for the past two years. 

However, reliability of scheduled air service into Cheyenne, the likelihood of flights 

being cancelled, is exceptionally poor, especially in 2014. 

Nearly HALF of all Cheyenne’s scheduled passenger airline operations in 

2014 were cancelled. This is far beyond the U.S. averages of the past few years of 

approximately 2%. 

Cheyenne Regional airport passengers now have only a 50-50 chance their 

flight will actually depart. 

There can be no doubt that reliability at Cheyenne Regional Airport is 

negatively impacting passenger traffic. Improved reliability is another reason 

Cheyenne seeks additional air service. Improved reliability is essential to growing 

enplanements at Cheyenne Regional Airport. 

Air Service Challenges 

0%

7%

15%

22%

29%

2013 2014 (YTD)

21.8% 23.4%21.7%

28.1%

Cheyenne U.S. 

% Flights Delayed % Flights Cancelled

0%

13%

25%

38%

50%

2013 2014 (YTD)

3.3% 1.5%

47.0%

11.6%

Cheyenne U.S. 
Air Service Development Efforts

15

Cheyenne has undertaken air service development efforts on its own. 

In 2010, Cheyenne attracted American Eagle nonstop service to Dallas/Ft. Worth. The 

service was funded by a combination of public and private funds, with the State of 

Wyoming contributing over $2 million to the effort. 

Cheyenne’s traffic doubled when competitive air service was present at the airport. 

While service was discontinued due to a number of factors, including American’s 

Chapter 11 bankruptcy and a 50% increase in fuel costs, clearly the increase in 

passengers demonstrates the demand for additional air service, currently unmet, from 

Cheyenne Regional Airport.

Impact of New Airline Service in Cheyenne

Annual O&D Passengers

100

7,575

15,050

22,525

30,000

2004

20052006

2007

20082009

2010

2011

2012

2013

American Others

CYS O&D Passengers 

Doubled from 2009-2011

26,363

13,147

Cheyenne seeks to SCASD funding to subsidize new service that will again grow 

traffic to the airport’s demonstrated potential.
Growth Potential

16

Regional Growth Is Possible - Example FNL

Load Factor

0%

25%

50%

75%

100%

Annual T100 Passengers

0

12,500

25,000

37,500

50,000

20022003

2004

20052006

2007

20082009

2010

2011

2012

Passengers/Yr (OW) Load Factor

91% 88% 91% 93% 90%

82%

75% 79% 78%

64%

0%

64%

75% 79% 78% 82%

91% 88% 91% 93% 90%

Cheyenne’s proximity to the large hub at Denver does NOT limit its growth 

potential. A look at nearby Ft. Collins, which is 40 miles south of Cheyenne and only 70 

miles from Denver International, shows that growth is possible in the shadow of a hub. 

Service grew from 0 passengers to an average annual 32,000 passengers. 

Ft. Collins sole air carrier ran load factors near 90% during the time it serviced the 

airport.

Average Annual Enplanements 2004-2012: 32,203

Distance to Denver Int’l Airport 

Cheyenne	 	 107 miles 

Ft. Collins	 	 70 miles
Plan and Overview

17

Cheyenne Regional Airport plans to use state, local and SCASD funds to solicit a 

second airline to serve the airport, with service to a major hub or O&D destination. 

The $200,000 SCASD grant will be part of a $1 million revenue guarantee and cost 

reduction package designed to attract a new airline. 

Specific program goals include: 

Increasing local utilization of Cheyenne Regional Airport. 

	 	 As noted, only 7% of catchment area passengers use the airport. 

	 	 Cheyenne seeks to improve this percentage radically with new air service.

Reducing local airfares. 

	 	 New airline service should cause fares to be more competitive with other 

	 	 	 regional airports, as in the past.

Better access to the U.S. Air Transportation Network. 

	 	 Cheyenne’s capacity has decreased significantly. 

	 	 Cheyenne’s average fares have increased significantly. 

	 	 A second airline serving the market will provide much needed capacity, 

	 	 frequency and pressure fares downward.

Increasing reliability of airline service. 

	 	 Nearly 50% of Cheyenne Regional Airport’s scheduled passenger flights 

	 	 	 were cancelled in 2014. 

	 	 Cheyenne Regional Airport needs airline service that provides service that is 

	 	 comparable to U.S. averages for on-time performance and reliability.
Plan and Overview

18

Allocation of funds: 

	 	 Revenue Guarantee: 

	 	 The revenue guarantee will be used to incentives new airline service at 	 	

Cheyenne Regional Airport. The funds will be used to offset the new airline’s losses 

for up to three years after commencing service. Exact terms will be negotiated 

once grant money is awarded. 

	 	 Total cash available for the revenue guarantee will be $900,000. 

	 	 Federal funds will account for 22% of the revenue guarantee. 

	 	 State and local funds will account for the remaining 78%

	 	 SCASD Grant: $200,000 

	 	 State Cash:	 	 $600,000 

	 	 Local Cash:	 	 $100,000 Non-Airport Funds 

Marketing: 

	 	 $25,000 Cheyenne Visitor’s Bureau - Cash 

	 	 $40,000 Cheyenne Regional Airport Funds - Cash 

					 Airport Marketing could exceed this amount, if necessary.

Facilities Use Abatements/Startup Costs offsets: 

	 	 Cheyenne Regional Airport will contribute the following to cost reductions 

	 	 $21,000		 Waive Terminal Usage Fees 

	 	 $19,000		 Waive Landing Fees 

	 	 $10,000		 Install Security Upgrades. 

Other Costs: 

	 	 $10,000		 Fuel Flowage Fee cost reduction. 

			 $900,000 - Revenue Guarantee. 

	 	 	 $100,000 - Marketing and Other Funds. 

Total: $1,000,000 

	 	 The airport will not use SCASD funds for administration, or monitoring and 

reporting of results under the grant. Additional expenses incurred will 	 	 	

be paid out of the airport’s general operating funds.
Plan and Overview

19

Oversight: 

The governing body of Cheyenne Regional Airport, the Cheyenne Regional 

Airport Board, will be responsible for all fiscal issues and D.O.T. reporting 

requirements. As a government entity, D.O.T. should be assured that proper 

financial oversight for implementation rests in the hands of the Commissioners. The 

Board of Commissioners understands that it is responsible for program expenditures 

and will submit invoices to D.O.T. for reimbursement based on the grant request. 

Timeline: 

Assuming the Department of Transportation awards Small Community Air 

Service Development grants in late 2014, Cheyenne Regional Airport will move as 

aggressively as possible to implement air service under the terms of the grant. 

Cheyenne Regional Airport is already in talks with various airlines for additional 

service to the airport. Should Cheyenne Regional Airport receive SCASD funds, it 

will solidify negotiations with those airlines and develop timelines and dates to begin 

new service. 

Legal Sponsor: 

Legal Sponsor for this project is the Cheyenne Regional Airport Board.
Priority Selection Criteria

20

Air fares are higher than the national average for all communities.

Cheyenne’s air fares are higher than average. 

In 2013, Cheyenne’s air fares were : 

48% higher than the U.S. average. 

78% higher than the nearest hub airport in Denver. 

Higher than nearby cities: 

	 	 42% higher than Laramie, WY. 

	 	 25% higher than Casper, WY. 

	 	 46% higher than Scottsbluff, NE. 

	 	 32% higher than Billings, MT. 

	 	 19% higher than Rapid City, SD.

The community or consortium will provide a portion of the cost of the activity from local 

sources other than airport revenues.

Cheyenne plans to fund this revenue guarantee package as follows: 

$200,000 Small Community Air Service Development Grant 

$200,000 Local matching funds 

				 50% from the Laramie County Economic Development Joint Powers Board 

	 	 	 	 30% from in-kind fee waivers 

	 	 	 	 20% from other sources

$600,000 State of Wyoming - Air Service Enhancement Program. 

$1,000,000 Total 

Federal Funding:		 	 20% of revenue guarantee. 

State/Local Funding:	 	 80% of revenue guarantee. 
Priority Selection Criteria

21

The community will establish a public-private partnership

Cheyenne Regional Airport is continues to work towards air service initiatives with 

groups that previously comprised the “Fly Cheyenne” organization. Those organizations 

include: The Cheyenne Convention and Visitor’s Bureau, Cheyenne Leads, and The 

Greater Cheyenne Chamber of Commerce.

The assistance will provide material benefits to a broad segment of the traveling public, 

including businesses, educational institutions and other enterprises, whose access to the 

national air transportation system is limited.

As only 7% of Cheyenne Regional Airport’s catchment area airline traffic chooses to 

fly locally, additional service that attracts a larger percentage of traffic will naturally 

benefit a broad segment of the traveling public. 

As the Cheyenne catchment area is the largest populated area within the State of 

Wyoming, it is expected that a substantial number of state business and public will 

benefit from the service. 

Since Cheyenne is the capitol of the state of Wyoming, Cheyenne Regional Airport 

expects the new service to also benefit state government as well. 
Priority Selection Criteria

22

The assistance will be used in a timely manner

With Cheyenne’s annual enplanements headed to 15-year lows, the community has 

already begun negotiating with airlines for new service. Cheyenne proposes a revenue 

guarantee for the first three years of service for the new carrier. Cheyenne Regional 

Airport has already begun negotiating with potential air service providers in attempts to 

secure air service contingent on receipt of a Small Community Air Service Development 

Grant. 

Secondary Selection Criteria

Innovation

Wyoming’s Air Service Enhancement Program (ASEP) is unlike any air service 

development program in the United States. The State of Wyoming combines state funds 

with local funds to attract and retain air service within the state of Wyoming. The 

program was originally funded at $6M per biennium. 

The primary goals of ASEP are to: 

	 	 Work with existing airlines to improve operational reliability 

	 	 Work to make airfares affordable. 

	 	 Increase passenger retention of Wyoming airports. 

	 	 Ensure airlines are financially stable to operate in Wyoming. 

	 	 Achieve financial stability in existing Essential Air Service markets. 

The program funds a number of routes within the state. 

Cheyenne seeks to combine Federal funds with those from this unique program to 

augment Cheyenne Regional Airport’s air service. 
Secondary Selection Criteria

23

Participation

Efforts to attract new airline service to Cheyenne have always enjoyed broad 

community support. The State of Wyoming’s and Cheyenne area’s willingness to fund 

80% of the proposed minimum revenue guarantee demonstrates that commitment. 

Location

Other Factors

The proposal directly addresses Cheyenne’s stated problems: 

New competitive airline service will: 

	 	 Reduce fares. 

	 	 Increase enplanements. 

	 	 Positively benefit the Cheyenne and Wyoming economies. 

	 	 Increase reliability, which is substantially below U.S. averages. 

Cheyenne’s air service is decreasing, and the airport seeks to reverse this trend. 

Cheyenne has access to Wyoming’s Air Service Enhancement Program to continue 

	 	 financial support for this project (if necessary)after SCASD funds have expired. 

The proposed Federal funding is only 20% of the total revenue guarantee.

Cheyenne’s geography is unique. Wyoming is the least populated state in the 

United States. Cheyenne’s ability to secure new airline service has been somewhat 

hindered by its proximity to Denver, a two-hour drive from Cheyenne. However, 

Cheyenne has supported new airline service in the past, as demonstrated by a doubling 

of enplanements at the airport when new service commenced. 

Cheyenne is the most populated region within Wyoming, and home to state 

government and many local businesses. 

Cheyenne Regional Airport is not proximate to an existing or prior grant recipient, 

and, therefore, award of a SCASD grant would have no negative impact on Cheyenne’s 

proposal or another active SCASD recipient. 
Previous Project Goals

24

Cheyenne Regional Airport’s 2014 Small Community Air Service Development 

Grant application differs substantially from the 2005 SCASD grant awarded to the state 

of Wyoming. The 2005 Wyoming grant was used to correct misperceptions about 

Wyoming’s air service through an advertising/marketing campaign. The 2005 grant 

was also used to increase passenger retention across all Wyoming airports. 

Although that grant was successful for the state, the 2014 grant application is 

geared mainly to attracting and funding new airline service at a specific airport with 

specific air service issues, rather than marketing existing air service. 

Since 2005, the air service environment in Cheyenne has become much more dire. 

Passenger retention has fallen, capacity has fallen and airfares have increased. 

Cheyenne Regional Airport stands to enplane fewer than 10,000 annual passengers for 

the first time in recent history. 

The 2014 application will be used to immediately gain new airline service and 

reduce troubling current trends.