A PROPOSALTO THE DEPARTMENT OF TRANSPORTATION OFFI CE OF THE SECRETARY WASHI NGTON, D.C Community

Proposal Southeast New Mexico Air Service Coalition City of Roswell, New Mexico DUNS # 06 - 412 - 1205 A PROPOSALUNDER THE SMALL COMMUNITY AIR SERVICE DOCKET DOT - OST - 2012 - 0069 DEVELOPMENT PROGRAM Under 49 - U.S.C. 41743 et seq. Mr. Robert Donnell Roswell - Chaves County

Economic Development Corporation PO Box 849 Roswell, NM 88202 - 0849 (5 7 5) 62 2 - 1975 IN TRODUCTION AND SUMMARY The Southeast New Mexico Air Service Coalition consists of local governments and business organizations located in Roswell, Carlsbad, and Artesia, in Chaves County and Eddy

County . The Coalition is a public/private Coalition and has developed a strong business relationship with American Airlines because of the ongoing Dallas/Ft Worth air service contract signed in 2007. The Coalition is submitting this proposal under the Small Community Air Service Program for marketing cost for the American Eagle non - stop service from ROW to DFW . The Coalition has developed superior marketing and sales program that ha s been very effective in driving demand for seats . The group has worked with American Airlines for over 4.5 years coordinating fares sale opportunities , revenue management, promotions and co op advertising to fine tune the program . The Coalition has developed a website designed to be used by the business community

in the service area. This website contains downloadable versions of logos, schedules, and information to be used in individual bu siness , marketing four - wall marketing (see marketing plan outline for more details) . T he site allow s for the coordination of the marketing of Coalition, expand s the local and visitor data base while communicat ing to potential passengers in a cost effectiv e manner.**Southeastern New Mexico Air Service Coalition Catchment Area**

The Coalition loo ks forward to marketing the current DFW program and believes that this application meets the criteria and spirit of the Small Community Air Service Development Pro gram. Please send correspondence regarding this application to: Mr. Robert Donnell Roswell - Chaves County

Economic Development Corporation Southeast New Mexico Air Service Coalition PO Box 849 Roswell, NM 88202 - 0849 On behalf of the Coalition, Iurge your speedy approval of our request. City of Roswell, NM Del Jurney Mayor City

of RoswellTable of Contents

1. Proposal details & overv iew.................................................................. a. Airport b. Project sponsor c. Summary

of proposal d. Project description 2. Coalition members and b ackground ....................................................... 3. Overview of the servic e area................................................................. 4. Air service histo ry and Milestones .................................................... 5 . Program Timel ine............................................................................. a. Action plan b. Mi lestones c. Monitoring program d. Project sustainability 6 . Marketing outlin e............................................................................. Exhibit A: Li st of companies in the encatchment area Exhibit B: Marketing Plan Outline Exhibit C: Marketing Budget1. Proposal details & overvie w

a. Airport Roswell International Air Center P.O. Drawer 1838 Roswell, NM 88202 - 1838 Roswell International Air Center (RIAC) began its history as Walker Air Force Base, one of the largest installations operated by the United States Air Force Strategic Air C ommand. Upon the closure of the base in 1967, the City of Roswell focused their efforts on building Roswell International Air Center as a local and regional industrial and commercial aviation center. RIAC recentl y am ended its name to emphasize its global objectives. The RIAC is home to a dy namic and important business cluster . B usinesses range from homeland security to bus manufacturing . The following is a partial list of services offered by the major tenants: municipal airport, aircraft maintenance/r epair, aircraft storage, aircraft painting, wire harness design and manufacturing, fiberglass molding, homeland security, international law enforcement training, bus manufacturing, manufacturing of industrial tubing, youth training, ph ys ical rehabilitation , and higher education provided b y Eastern New Mexico University- Roswell. The Air Center charges only nominal landing fees, has unrestricted landing slots, is not congested, and has unobstructed approaches. It has a full service Air Traffic Control tow er, approach control, on - site firefighting department, and a F.A.R. 145 approved maintenance facility . Runway

3/21 is 2.5 miles long and has pavement strength of 100,000 lbs. single, 200,000 lbs. T, and 400,000 lbs. S.T. R unway 17/35 is 10,000 feet long has pavement strength of 77 lbs. single, 104 lbs. T , and 132 lbs. S .T. 2. Project Sponsor The official sponsor of this application is the City of Roswell, NM. 3. Historical and Current Background of Roswell Air Service Currently Roswell is served by

American Eagle for non - stop flights to Dallas/Ft Worth, using an Embraer 145 aircraft with 50 seats three times per day except on Saturday s, when the service is reduced to twice a day . The program has been a great success and as of December 2011 the overall load factor has been 64 % with an av erage one - way fare of $11 8 . There have been 169,777 passengers fly

on the service and millions of dollars have been generated in the community

and at the airport since the start of the service in September 2007 . Numerous cor porations have decided to open new offices or expand operations in the region because of the convenience of having air access to a major hub.4. Summary and Description of the Proposal

Currently the Coalition has raised $ 25 6 ,000 i n financial commitments f or marketing of the current ROW - DFW service from the private sector, local city and state governments. The flights use Embraer Regional J ets with either 44 or 50 and operate six day s a week with three flight s per day and two flights a day on Saturdays . Al l the US DOT funds will be matched 50/50 and spent on marketing of the program . An outline of the marketing plan is located in Exhibit A. The Coalition requests $20 0,000 from the Small Community Air Service Development program which will be spent over a two ye ar period. The City of Roswell, as sponsor of the proposal, will be responsible for the management of the funds and will work with the Roswell - Chaves County Economic Development Corporation to execute the marketing and advertising plan. The chart below details the commitments from each supporting organization. Percentage Amount Organization 78 % $ 200,000 State of New Mexico 8 % $ 2 1,0 00 City of Roswell 14 % $ 35,000 Private Sector

100.00% $ 25 6 ,000 Total Support

T he Roswell airport has offered $21 ,000 annually in savings to American Eagle including no cost for landing fees, equipment and counter space lease for the service. There have been more in - kind contributions from communi ty media organizations, foundations and service organizations to support the service. 5. Coalition Members and Background The Roswell - Chaves County Economic Development Corporation , the Carlsbad Department of Development, and the Greater Artesia Economic D evelopment Corporation (which together represent 3,380 businesses in the area) are committed to marketing these flights and working with local governments and industries to ensure a concise, consistent, and coordinated effort to fill the additional seats. The Coalition was formed almost eight year ago to address the deficien cy

in air service in the region and was successful in securing ROW - DFW non - stop service on American Airlines.6. Deficiency of Participation out of ROW Air Service out of Southeast New Mexico was scarce prior to American Eagle Airlines providing daily jet service via ROW - DFW in 2007 . The only other option for travelers at that time was to drive to area airports ranging from 150 miles to 200 m iles dependent upon the airport and city one is driving from. Now with Hobbs, NM receiving daily jet service, it is critical to have the appropriate funding available to market the ROW - DFW route to maintain and increase the traveler participation. The load factor critical to the ROW - DFW route is maintaining 62% or higher. With recent reductions in our marketing budget, we have cut back significantl y on marketing the service in those areas and have seen the load factors decrease since the start of the Hobbs service. Marketing in the Artesia, Carl sbad and Eddy County area is critical to the success of the ROW DFW service. 7. Overview of the service area The area encompassed by the Coalition has over 113,000 residents and supports a well established tourist industry . More visitors are accessing Southeastern New Mexico via DFW ROW service related to horse racing, second homeownership in the Ruidoso region, Carlsbad Cav erns and the lure of alien space travel. Economic diversification is an expressed goal of community leaders throughout Southeastern New Mexico. We are rural communities and our objectives reach far beyond the ty pical Ag related industries. The Federal Law Enforcement Training Center (FLETC) in Artesia trains over five thousand (5,000) Federal employees each year at their advanced training center in Artesia, New Mexico. The International Law Enforcement Academy (ILEA) in Roswell trains in excess of six hundred (600) international police officers each year at their new US Department of State funded training center and M IST IC , a private homeland security training compan y, trains Federal emplo ye es as well as private citizens at their properties throughout our region. The US Department of Energy WIPP (Waste Isolation Pilot Project) in Carlsbad, NM is mandated to store and dispose of trans uranic mixed waste at their Carlsbad, NM underground site. Each of the named training facilities has extensive travel requirements. Oil and Gas recovery

and production is a critical component of the Southeastern New Mexico regional econom y. Independent fossil fuel recovery companies are situated throughout the Coalition’s catchment area. Holl y Corporation, an independent petroleum refinery produces gasoline, diesel and jet fuels. Holly Corp. operates a seventy- five thousand (75,000) barrel per day ref inery in Artesia, NM. Holly

Corporation’s headquarters is located in Dallas, Texas andthe Coalition anticipates that inbound business travelers supporting he Holly Corporation’s

operation will fill a portion of the increased capacity . Federal law enforc ement employees receive training at the Artesia, New Mexico facility . The majority of the students and training staff participating in the FLETC program travel from all over the United States to the New Mexico site. The economic health of the Artesia area has for decades been dependent upon the oil and gas business. The major employers in this cluster includes Navajo Refining Company , Yates Corporation, Marbob Energy Corporation, Mack Energy Corporation and a host of other companies providing support t o these businesses. This business sector provides the greatest number of jobs in the Greater Artesia Development Corporation area. The Carlsbad area economy has experienced major economic expansion as a result of the establishment of the U.S. Department of Energy ’s Waste I solation Pilot Plant (WIPP). The plant is located 26 miles east of the city of Carlsbad. The project has generated over 580 direct jobs , with numerous technological spin - offs , by providing a national solution for disposing of transuranic waste in ancient salt beds 2,150 feet underground. The Waste Isolation Pilot Project, potash mining and petroleum industries as well as tourism have created the need for direct air service to Southeastern New Mexico. Detailed throughout the Southeas tern New Mexico Air Service application is the expressed need for affordable reliable air service. Many of our regional businesses are served by product and service providers located outside of our immediate areas. Timel y and reliable transportation allo wing for in person collaboration is a necessity for them. The region is the seventh largest dairy producing region in the United States. The average number of producing cows at each of the forty - five (45) plus dairies is over 2,000 head per dairy operat ion. Due to EPA and Food and Health Department regulations, travel by lab technicians, veterinarians, EPA and other governmental agencies is extensive into the region in order to assist our local dairy

owners to maintain the high quality of products that they

produce. Leprino Foods, Inc. and Select Milk Producers have built some of the world’s largest milk and cheese processing facilities in Chaves County . Over five hundred highly skilled full - time personnel work at these plants. The combined economic impact of the agricultural industry in Chaves County alone is over $900 million annually . Farmers and farm production personnel no longer ‘stay down on the farm’ and travel is required to stay current on production methods and world agricultural productio n trends. Tourists from this world (and perhaps other worlds...) travel to Southeastern New Mexico to take in the beauty, weather, culture and the hospitality of this high plains desert region. Roswell,internationally know for its ‘out of this world’ vis itors attracts over 500,000 earthl y investigators annually to answer for themselves the ongoing question, “Did they really crash in Roswell”? Many other well known historical and scenically beautiful sites are situated throughout the entire southeastern r egion, including: Carlsbad Caverns National Park, Guadalupe Mountains National Park, Ruidoso/L incoln National Forest, Sitting Bull Falls, Bottomless Lakes State Park, Bitter Lake National Wildlife Refuge numerous parks, zoos, and other outdoor recreational opportunities. These sites attract millions of visitors to the re gion each ye ar. Due to the lack of marketing in the larger metropolitan areas, air travel is unknown by the vast majority

of tourists who visit this region annually . The Roswell Internati onal Air Center is the focal point of industrial and manufacturing activity in Chaves County , NM. A variety of businesses and support industries are located at the once Strategic Air Command airfield

– Walker Air Force Base. In 1967 the base closed and the property became the responsibility of the City of Roswell. City leaders aggressivel y developed this asset by

attracting businesses and strengthening the econom y. Today, the Roswell International Air Center is home to: Dean Baldwin Painting, an aircra ft painting compan y , contract ing with major airlines and the military . Additional Roswell International Air Center tenants include: Millennium Transit Service, LLC, a bus manufacturing company providing buses for major metropolitan cities across the country ; New Mexico Youth Challenge , New Mexico Department of Transportation , New Mexico Rehabilitation Center , Job Corps , International Law Enforcement Academ y and Eastern New Mexico University

– Roswell are other organization that make up the list of airport tenants. 8. Air Service History and Milestones Roswell had regular scheduled air service to DFW until September 2001. Business and leisure travelers have missed this service since its demise after the terrorist attacks of that month. In the past, the C oalition has discussed with several major and regional airlines the idea of increasing service to the region. In 2004, representatives from the Coalition attempted to enter into negotiations with two different airlines to provide service to Texas. These discussions proved educational and the delegation became more aware of the economic risks to the airlines associated with starting new service. The Coalition was unable to negotiate a deal until March 2007 with American Eagle which included a minimum reve nue guarantee. Milestones a. May 2007

– American Eagle announces service, flights are loaded , and available for sale in the computer reservation s ys tems. b. 2007

– Announcement of service and local supported marketing starts. c. September 2007

– Announcement of the US DOT awards.d. September 2007

– Signing of contract between the City of Roswell and US DOT letter of commitment. e. October 2007

– Launch of cooperative of the cooperative marketing program plan. f. March 2008

– A third daily (except Saturday) DFW flight wa s added to the service g. August 2008

– A fourth daily (except Saturday) DFW flight was added to the service h. January

2009

– Flights reduced to three daily (except Saturday , two flights a day) i. May 2009

– A contract with American Eagle was negotiated to bring n on - stop service to LAX starting in August 2009 j. August 2009

– Four flights a week ROW - LAX flight service was added k. April 2010

– A fourth flight dail y (except Saturday) DFW flight was added to the air service l. August 2010

– Flights reduced to three daily (exc ept Saturday , two flights a day); ROW - LAX service discontinued m. April 2011

– A fourth flight dail y (except Saturday) DFW flight was added to the air service n. November 2011

– Flights reduced to three dail y (except Saturday, two flights a day) 9. Program Timel ine The Coalition is “shovel ready” and will have already implemented th e marketing plan at the time the grant is awarded. The project has full regional and community support . There will be a few pieces of the marketing plan that will kick off July 1, 2 012 while other media venues will be negotiated. If the Coalition is awarded a grant, the funds will be spent s t arting January 1, 201 3 for the next 24 months. 10. Monitoring program The monitoring program will provide quarterl y updates of the marketing p lan, proof of advertising and paid invoices to the US DOT .Exhibit B 

## Marketing Plan Outline Current Situation

– American Eagle is servicing the City of Roswell , Chaves County and Southeastern New Mexico with non - stop service from ROW to DFW . Th e flights use Embraer Regional Jets with either 44 or 50 seats . T he service operate s five day s a week with three flight per day and two flights on Saturday s . Target Markets

– There are four retail target markets including the local leisure traveler, the local business traveler , the inbound business travelers and the leisure visitors . The marketing plan is designed to cross communicate the Fly

Roswell message to all travelers using retail advertising, four - wall marketing, public relations, sales promo tions special events and community sponsorships. There are four trade target markets including non - profit organizations, governmental agencies , local businesses and inbound leisure travelers (Ruidoso and Carlsbad). The trade market organizations will be used as a communications vehicle to these organization’s employees, clients, related service companies and customers. One of the major key s is to have buy- in from the General Manger, President or CEO of the organizations in the region. The Coalition will provide these companies , at litt le or no cost , the marketing materials to be used to deliver the Fly Roswell message. Marketing Backbone - The marketing backbone is already in place for the ROW - DFW service . B y developing the back of the house creativ e and design projects include collateral materials, placing advertising, data base development, logo design, website design, longer term partnerships etc. Communications Details Advertising

– The funds will be used for a traditional advertising campaign; radio and newspaper etc. The radio and newspaper campaigns will be leveraged with sales promotions directing individuals to websites in order to increase the current database. The newspaper campaign needs to leverage the editorial and public relatio ns opportunities. See Exhibit D for a complete advertising and marketing budget plan.Four - wall marketing The four - wall marketing plan information is being managed and displayed on the Fl y Roswell business - to - business section of the website. Th is site include s up to date correct consistent schedule information, special fares, promotions, sponsorships, recommended text for emails and collateral material, logos, up - coming events, list of supporters and details of the program. The Roswell - Chaves County

E DC will manage the site for the Coalition and will remain the single point to distribute the information. In addition to the website, there are numerous opportunities to deliver the Fl y Roswell message via the members. This process will engage individuals to become ambassadors of the program. There is little or no additional hard cost for supporters to include the Fl y Roswell message into their day- to - day business activities . Li sted below are some opportunities to consider :

• In clude a Fl y Roswell mes sage and logo on your web site. • Integrate the Fl y Roswell logo on your home page. • In the directions or map tab

– include the airport location. • Provide details of air service available at ROW. • Create links to Fl y Roswell homepage. • In clude Fl y Rosw ell message information in your newsletter and e - mail distribution list. • Train emplo yees about air service available at ROW (companies, hotels and reservation centers). • Distribute collateral to guests at check - in and concierge desks. • Fly

Ros well message included in bank statements, utility billings, letters to property owners, etc. • Distribute collateral to guests at special events. • In clude Fl y Roswell message with reservation confirmation (hard/electronic cop y). • Place tabletop collateral in guest rooms, at front desk and in restaurant. • In clude a Fl y Roswell message on all e - mail signatures. • In clude a Fl y Roswell message in welcome binders. • In clude a Fl y Roswell message on community television. • Add a Fl y Roswell messag e to your phone hold messages. • Affix a Fly

Roswell sticker to envelopes or mailings. • Arrange for travel agencies to promote and support service. • Other travel agencies incomplete thoughtPublic Relations

–

The public relations program will have two media target s, first the local media outlets . T his will leverage the advertising buy s with public relations needs . The second media target will focus on areas outside of the state of New Mexico geared towards business and leisure . The positioning of Fl y Roswell is the “in thing” to do. It is the “the topic” of conversations at special events, clubs, social gatherings, business meetings etc. Trade Show and Chamber of Commerce

– The Coalition will develop business relationships with travel i ndustry organizations , business clubs, trade associations and chamber of commerce in large metropolitan areas . These networks generate support in leisure and business travel and corporations looking for competitive l abor when the cost of living is lower than the national average. Database Management - The development of a trade and consumer email database leverages the communications budget and creates a fast and inexpensive vehicle to send messages to a targeted group of air service supporters and cons umers. Names and addresses can be collected via numerous opportunities , including websites, promotions, contests, opt - in programs, hotel registration, convention/meeting events, special events, partnerships and purchase. Currently the Coalition has acces s to over 6,000 name and email addresses that can be used to market the servi c e. Research - The ROW airport has experience tremendous growth in the past ye ars and we have conducted many survey s online and at the airport to make sure we are meeting the tr aveler’s needs . We have found that there are many in the encatchment are that are unaware of the service out of ROW, so it is critical that we continue to market the ROW - DFW service. The results allow the Coalition to understand more about needs of the t arget markets i.e. the purpose of the trips, local or visitor, length of the trips, prioritize the improvements of the facilities at the ROW airport and new additional air service.Exhibit C 

## Marketing Budget **Media Venue Description**  **Budget** Televisi on 2 stations (KOB, KBIM) $60,000.00 Radio 3 stations (KBIM, MTD, Majestic) 45,000.00 Billboards (SENM & Dallas) 48,000.00 Website/Design Graphmaster 18,000.00 Print magazines 60,000.00 Movie Theatre 3 theatres (Roswell, Carlsbad, Artesia) 30,000.00 Promotional/Tradeshows tradeshows/receptions; promotional items 50,000.00 Gift Cards gift cards for sponsorships/trades 24,000.00 Anniversary 5 year anniversary event 65,000.00



### Total: **$400,000.00** **proposed budget based on a 2 year per iod