Order: 20 10

- 2

- 1 4

Served: February 16 , 20 1 0



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 16 th day of February , 20 10

Docket DOT

- OST

- 1997

- 3005

ORDER REQUESTING PROPOSALS

Summary By this order

, the Department is requesting proposals from carriers interested in providing

essential air service (EAS) at McCook

, Nebraska , for the next two year period from July 1, 2010, through June 30, 2012 , with or without subsidy . Proposals are due March 19 , 20 1 0. ( See Appendix A for an area map.)

Background By Order 200 8

- 5

- 2, May 5, 2008

, the Department selected Great Lakes Aviation, Ltd. (“Great Lakes”) to provide 12 weekly nonstop flights using Beechcraft 1900

- D aircraft from McCook to Denver International Airport

, for a two

- year period beginning when the carrier inaugurated service through the end of the 24 th month thereafter, at an annual subsidy of $1,583,277. Great Lakes inaugurated service to McCook on June 1 , 2008

.

Request for Proposals

As the end of the current rate terms approach es , we are here request ing proposals from carriers

inte rested in providing essential air service at McCook , with or without subsidy , for the two

- year period beginning July 1, 2010. Carriers should file their proposals no later than March 19, 2010.

A fter that date, our staff will docket proposals, thereby making them public, and direct each carrier to serve a copy of its proposal on the civic parties and other applican ts. Shortly afterwards, we will Essential Air Service at

M c COOK

, NEBRASKA

under 49 U.S.C. 41731 et seq.- 2

-

provide 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

Interested carriers should prepare their proposal s with every expectation that their initial proposals will represent their final and only proposals. However, we retain the discretion to negotiate proposals with carriers when we deem it desirable; in such cases, of course, we will give all applicants th e same opportunity. We also retain the discretion to reject outright all unreasonable or unrealistic proposals and solicit a new round of proposals. However, negotiation or rejections are only occasional exceptions to the rule.

We are here providing int erested 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 to present; however, they might want to include proposed schedules as well as supporting data for their subsidy requests, such as projected block h ours, revenues and expenses. We strongly encourage clear, well

- documented proposals that will facilitate their evaluation by the affected communities and the Department. 2

With respect to McCook , we expect proposals consisting of service with two

- pilot, twin

- engine aircraft with at least 15 passenger seats, and offering two round trips each weekday and weekend (12 total round trips per week) to Denver or a suitable hub airport, with numerous connecting opportunities to the national air transportation syst em. If aircraft with fewer than 15 passenger seats are contemplated, service patterns should consist of three round trips each weekday and weekend (18 total round trips per week). If a proposal offering aircraft fewer than 15 seats is

submitted and the community ultimately supports the service, 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 waives their rights fo r all time. Of course, as always, we will formally solicit the community’s views on any service options we receive before making a long

- te rm carrier selection decision. 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 airline interested in submitting a proposal.

We encourage proposals that meet these requirements in an efficient manner. Carriers ar e also welcome to propose more than one service option, if they choose; they need not limit themselves

1 Carriers should not expect the Department to accept late filings. In cases where a carrier proposes to provide essential air service without subsidy and we determine that service can be reliably provided without such compensati on, we do not proceed with the carrier

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

free service as proposed.

2 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 wi th a larger carrier at the hub; and (4) community views

. In addition

, 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 essential air service will be included in the selection order as part of our authorization of sub sidy for the selected

service. Appendix C of this order contains those general provisions.- 3

-

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

-- different hubs, for example

-- with subsidy requiremen ts that remain competitive.

New Filing Procedures Carrier proposals s hould be s ubmitted to the Department with all materials merged into a single

document. The document will be published on Regulations.gov and each page should be

formatted to be viewed o nline.

Service and Traffic History During the 12

- month period ending September 30, 2009 , th e most recent period for which traffic data are available, McCook averaged 5 .6 enplanements a day. 3 In order to assist carriers in making their traffic and revenue forecasts, we have included historical traffic data in Appendix B.

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

- free workplaces, and nondiscrimination. 4 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 nondiscrimina tion, 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 carriers 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 re garding these requirements should contact the Office of Aviation Analysis at (202) 366

- 5903. 5

Community and State Comments

The communit y and state are welcome to submit comments on the proposals at any time. As noted earlier, however, we will provide a s ummary of the proposals to the civic parties and ask them to submit their final comments shortly after March 19

, the due date for proposals.

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

- delegated to the Director, Office of Avia tion Analysis.

ACCORDINGLY,

1. We request that carriers interested in providing essential air service at McCook

, Nebraska

, during Ju ly 1, 2010, through June 30, 2012

, submit their proposals, with or without requests for subsidy, no later than March 19

, 20 1 0

. The proposals should be e

- mailed to EAS@dot.gov

, with

3 See Appendix B for historical traffic data. Enplanements represent one

- half of total origin

- and

- destination traffic, and average enplanements per day are base d on 77 weekdays and weekends each quarter , except as noted.

4 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 Tra nsportation

– 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

– Nondiscriminat ion on the basis of disability in air travel; and (3) 49 CFR Part 29

– Government

- wide debarment and suspension (non

procurement) and government

- wide requirements for drug

- free workplace (grants).

5 The certifications are also available on the web at htt p://ostpxweb.dot.gov/aviation/index.html.- 4

-

the title: “Proposal to Provide Essential Air Service at McCook

, Nebraska , Docket DOT

- OST

1997

- 3005 ; ” 6

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

3 . We will serve cop ies of this order on the Mayor of the City of McCook

, McCook Regional Airport, 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 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 shall not preclude

its effectiveness.

By:

TODD M. HOMAN

Director Office of Aviation Analysis

(SEAL)

An electronic version of this document is available on the Internet at http://www.regulations.gov

6 Questions regarding filings in response to this order may be directed via e

- mail to Kevin Schlemmer at kevin.schlemmer@dot.gov or via phone at (202) 366

- 3176.Appendix A



## AREA MAP

This map is provided by Planet Profitability Forecasting System and is being used with express permission of the copyright holder, Sabre Airline Solutions®.Appendix B

Traffic History *

Year Quarter Inbound

Pax Outbound

Pax Total

2006 4 609 616 1,225

2007 1 564 659 1,223

2007 2 746 794 1,540

2007 3 785 810 1,595

5,583 Total

2007 4 699 753 1,452

2008 1 400 403 803

2008 2 328 350 678

2008 3 532 479 1,011

3,944 Total

2008 4 436 457 893

2009 1 416 388 804

2009 2 468 408 876

2009 3 485 448 933

3,506 Total

A verage daily enplanements at McCook

– 5

. 6 **

* Source

– T

- 100 Market Report, Passengers in Scheduled Passenger Service, includes traffic only for Air Midwest, Inc. and Great Lakes Aviation, Ltd.

**Average daily enplanements is total traffic for the most recent 1 2

- month period ending September 30, 2009, divided by 313 service days, divided by 2.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, 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.

Funds are not curren tly available for performance under this solicitation beyond [DATE]

. The Government’s obligation for perform ance 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] , th e carrier will receive notice in writing by the Department.

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, o r amendments thereto shall not operate to controvert the foregoing paragraph.

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

.Appendix D

Scheduled Air Ca rriers, Contiguous US and Puerto Rico
Air Sunshine, Inc. Jet Air, Daniel Wolford
Air Sunshine, Mirmohammad Adili Kenmore Air, Tim Brooks
Air West, Inc., John Raatz McCall Aviation and Salmon Air, Dan Scott Air Wisconsin, Annette Daly McCall Aviation, Michelle
Airline Associates, Bill Mishk Mesa, Jonathan Ornstein
Alaska Airlines, Jeff Cole Mesa, Michael Lotz Alaska Airlines, Sandy Sinick Mesa, Mike Holcomb Allegiant Air, Robert Ashscroft Mesaba, John Spanjers
American Airlines, Carl Nelson Mesaba, Max Shemesh American Eagle, Jeffrey Hartz Midstar Airlines, Jeffrey Fonner
Atlantic Southeast, Jon Lindlief Midwest Airlines, Anthony Intravia Atlantis Southeast, Roger Weston Midwest Airlines, Greg Aretakis Bemidji Aviation, Cori Rude Midw est Airlines, J.C. Augustson Bemidji Aviation, Arlen Rinkenberger MN Aviation, Jose Maldonado Cape Air, Andrew Bonney Multi Aero, Darnea Cape Air, Dan Wolf Multi Aero, Shane Storz Cape Air, J. Flaherty Northwest, Tim McDonald
Classic Aviation, Tony Henderson NYDC, Henok Araya Colgan Air, Mike Colgan OST, Brian Swanson CommutAir, Andy Price OST, Dennis DeVany CommutAir, Joel Raymond OST, Kevin Adams Consultant, Robert Silverberg OST, Kevin Schlemmer
Continental, Bruce Keiner OST, Michael Martin
Continental, Dan Weiss OST, Renee Williams Continental, Lorry Halloway Pacific Wings, Frank Ford Delta, Amy Martin Pacific Wings, Greg Kahlstorf
Delta, Dan Shuman PenAir, Danny Seybert Delta, Jeff Morgan PenAir, Scott Bloomquist Delta, Joe Esposito Pinnacle Airlines, Joe Williams Delta, Karen Zachary Pinnacle Airlines, Phil Reed
Delta, Sascha Vanderbellen Public Charters, Jim Gallagher

Dorado Jets Scenic, Mary Schneider
Dorado Jets, Mark McKenna Scenic, Mitzi Daines

Era Aviation, Mike Lenorman Seaborne Airlines, Wayne D'Amico
Executive Airlines, Kate Soled SeaPort Airlines, Jim Day Frontier Flying, Bob Hajducovich SeaPort Airlines, Rob McKinney
Gem Air, Dan Schroeder Shuttle America, Jerry Balsano
Gem Air, JoAnn Wolters SkyWest, Eric Christensen
Great Lakes, Chuck Howell SkyWest, Michael Thompson Great Lakes, Doug Voss Sovereign Air, Bob Karns Great Lakes, Greg Stephens Sovereign Air, Lois R. Barton
Gulfstream, Dave Hackett Tradewind, Eric Zipkin Gulfstream, Mickey Bowman TransStates, Fred Oxley Gulfstream, T. Cooper TransStates, Gerry Wigmore Homeland Security, David Bernier United, Alicia Gabriel Homeland Security, Randy Webb United, James Starnes
Horizon Air, Dan Russo US Airways, Benjami n Slocum Horizon Air, Jennifer Thompson US Airways, Howard Kass
Horizon Air, Jeff Cole US Airways, Jason Reisinger ICEPR, Luis Irizarry Warbelows Air Ventures, Art Warbelow
Island Air Charters, Linda House Wings Air (Air Greco), Aaron Goerlich