O rder: 2014

- 3

- 16

Served: March 28, 2014



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 28 th of March , 20 1 4

ORDER REQUESTING PROPOSALS

Summary By this O rder, the Department is requesting proposals from air ca rriers interested in providing

E ssential A ir S ervice (EAS) at Huron, South Dakota

, for a new contract period beginning

October 1, 201 4 , with or without subsidy

. (See Appendix A for a map). Air c arriers should file their proposals no later than April 28 , 2014

.

Background
By Order 2012

- 8

- 22 ( August 20

, 2012 ), the Department re

- selected Great Lakes Aviation, Ltd., (Great Lakes) to continue to provide 12 nonstop round trips per week to Minneapolis/St. Paul International Airport (Minneapolis) with 19

- seat Beech 1900D aircraf t, for a two

- y ear period from October 1, 2012, through September 30, 2014.

The complet e public file for EAS at Huron may be accessed online through the Federal Dockets Management System at: www.regulations.gov by entering “DOT

- OST

- 2000

- 7138 ” in the “Search for Rules, Comments, Adjudications, or Supporting Documents” field.

Request for Proposals

As the end of the current contract approaches, the Department is requesting proposals from air carriers interested in providing EAS at Huron

, with subsidy support if necessary , for a new contract period beginning October 1, 201 4

. Carriers should file their proposals no later than April 28

, 20 14

. Staff will the n docket the proposals, thereby making them public

. Shortly afterwards, we will provide a summary of the proposals to the communit y and ask them to Essential Air Service at

H URON
, SOUTH DAKOTA

Under 49 U.S.C. § 41731 et seq

. DOCKET DOT

- OST

- 2000

- 7138- 2

-

submit their final comments. We will give full consideration to all proposals that are timely

filed. 1

Interested air carriers should prepare their proposals 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 the same opportunity. We a lso retain the discretion to reject outright all unreasonable or unrealistic proposals and re

- solicit a new round of proposals. However, negotiation and rejection are only occasional exceptions 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. Air carrier proposals should be submitted to the Department with all materials merged into a single document. I n addition, because the document will be published on

www. Regulations.gov, each page should be formatted to be viewed online. We expect proposals to adequately describe the service being proposed and the annual amount of subsidy being requested. The appl icants can make their own judgments as to the level of detail they wish to present; however, we recommend they include information concerning proposed

schedules and projected block hours . In addition, applicants are encouraged to provide

financial data su pporting their subsidy requests, including information on their projected expenses and revenues. We strongly encourage clear, well

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

Proposals shoul d provide sufficient capacity to accommodate historical levels of traffic. In order to assist air carriers in developing traffic and revenue projections for their proposals, we have provided a summary of historical passengers in Appendix B. During the ye ar ended

December 31

, 2013, Huron averaged 5.8 enplanements per day. The Department expects proposals that are co nsistent with what the community currently receives, with service to a large

- or medium

- hub airport that provides numerous connecting opportun ities to the national air transportation system. Specifically, air carriers should propose two round trips each weekday and weekend (12 a week)

. We would also consider proposals with 8/9

- seat aircraft

1 Carriers should not expect the Department to accept late fillings. In cases where a carrier proposes to provide

EAS without subsidy and we determine that basic EAS, as required by 49 U.S.C. § 41732, ca n be reliably provided without such compensation, we typically will 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 EAS for an eligible place not in Alaska , 49 U.S.C. § 41733(c) (1) directs us to consider five factors: (a) service reliability; (b) contractual and marketing arrangements with a larger carrier at the hub; (c) interline arrangements with a larger carrier at the hub; (d) commu nity views, giving substantial weight to the views of the elected officials representing the users; and (e) whether the carrier has included a plan in its proposal to market its service to the community. In addition, the Consolidated and Further

Continuin g Appropriations Act, 2012, Public Law No. 112

- 55, and continued by the Full

- Year Continuing Appropriations Act, 2013, Public Law No. 113

- 6

, and the Continuing Appropriations A ct, 2014, Public Law No.

113

- 46, provides that wh en selecting a carrier to provi de EAS, the Department may consider the relative subsidy requirements

, thus codifying a factor that we have considered sinc e the inception of the program

. Interested carriers should also be aware that our general provisions governing Essential Air Servic e 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.- 3

-

and additional frequencies. Air c arriers are also we lcome to propose more than one service option, if they choose. T hey also need not limit themselves to the se requirements if they envision other, potentially more attractive service possibilities

-- different hubs or length of

contract, for example

-- with subsidy requirements that remain competitive.

Community Comments The community is welcome to submit comments at any time. We encourage prospective applicants to contact the community before they submit their proposals so that they can tailor

them to the community’s 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 shortly after the deadline for carrier proposals, and ask them to submit their final comments.

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

- free workplaces, and nondiscrimination. 3 Consequently, all carriers receiving Federal subsidy for EAS must certify tha t 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 contract must also certify that they are in compliance with the regulations g overning 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 regarding these requirements should contact the Offic e of Aviation Analysis at (202) 366

- 5903. 4

This Order is issued under authority delegated in 49 CFR Part 1.25a(b) and re

- delegated to the Director, Office of Aviation Analysis.

ACCORDINGLY, 1. We request that carriers interested in providing Essential Air Service at Huron

, South

Dakota

, submit their proposals, with subsidy support if necessary , no later th an April 28

, 20 14 . The proposals should be e

- mailed to: michael.gormas@dot.gov with the title “Proposal to Provide E AS at Huron

, South Dakota ”; 5

2. Th is docket will remai n open until further O rder of the De partment; and

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; (3) 49 CFR Part 27

-- Nondiscrimination on the Basis of Disability in Pro grams and Activities Receiving or Benefiting from Federal Financial Assistance; (4)

14 CFR Part 382

-- Nondiscrimination on the Basis of Disability in Air Travel; and (5) 49 CFR Part 29

-- Government

- Wide Debarment and Suspension (Non

- Procurement) and Gove rnment

- Wide Requirements for Drug

- Free Workplace (Grants).

4 The certifications are also available on the web at http://www.dot.gov/policy/avia tion

- policy/small

- community

rural

- air

- service/essential

- air

- service

. 5 Questions regarding filings in response to this O rder may be directed to Michael Gormas at (202) 366

- 1853 or michael.gormas@dot.gov

.- 4

-

3 . We will serve copies of this O rder on the M ayor of Huron, South Dakota

, the airport manager of Huron Regional Airport , and the service list for this docket.

Persons entitled to petition the Department for review of this Order under the Department’s Regulations, 14 CFR Part 385.31(a), must file such petitions within seven (7) 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

Online at www.regulations.gov

.Appendix A

AREA MAP

Maps generated by the Great Circle Mapper

- copyright © Karl L. Swartz

.Appendix B

Huron, South Dakota 1

Quarter Year Deplanements Enplanements Total Traffic Enplanements per Day 2

1 2012 370 316 686 4.3

2 2012 361 327 688 4.5

3 2012 555 539 1,094 7.0

4 2012 446 398 844 5.3

Annual

Totals 1,732 1,580 3,312 5.3

1 2013 377 370 747 4.7

2 2013 483 414 897 5.8

3 2013 509 488 997 6.4

4 2013 563 454 1,017 6.4

Annual

Totals 1,932 1,726 3,658 5.8

Notes:

1. Source: Bureau of Transportation Statistics T

- 100 Market.

2. Enplanements per Day = Total Traffic/2/313 annual service days (314 in leap years).Appendix C

Example of General Terms and Conditions for Essential Air Service

The carrier understands that it may forfeit its com pensation 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, onl y 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 questio n. 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 fu ll 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

traff ic 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 tran sportation system provided to the community.

If the Department unilaterally, either partially or complete, 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.

Funds may not be available for performance under this Order b eyond [DATE]. The Government’s obligation for performance under this Order beyond [DATE ] is subject to the availability of funds from which payment for services can be made. No legal liability on the part of the Government for any payment may arise for p erformance under this Order beyond [DATE], until funds are made available to the Department for performance. If sufficient funds are not made available for performance beyond [DATE] , the Department will provide notice in writing to the carrier.

Subsidy c ontracts 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 par agraph.

All claims for payment, including any amended cl aims, must be submitted within 9 0 days of the last day of the month for which compensation is being claimed. For example, claims for service provided in July must be filed by October 31 st ; August cl aims must be submitted by November 30 th , and so on.