February 11,2014

Mr. Kevin Schlemmer

Director, Essential Air Service

U. S. Department of Transportation

1200 New Jersey Ave., SE

Washington, DC, 20590

Re: Kalaupapa, HI Essential Air Service

Dear Mr. Shlemmer:

As the president and CEO of Mokulele Flight Services, Inc., dba Mokulele Airlines, I am

respectfully requesting the opportunity to summarize the reasons that we feel Mokulele is

uniquely qualified to provide Essential Air Service to Kalaupapa, Hawai'i. This is a follow-up to

our EAS proposal dated October 30th, 2013.

On a personal level, I have a strong commitment to the state through my 52 years of aviation

history in Hawai'i. In fact, this is where I learned to fly. My goal when I purchased Mokulele in

2011 was to provide safe, affordable interisland travel and it is a goal I continue to be deeply

committed to. We are well prepared and well equipped to provide the residents and visitors of

Kalauapapa with reliable, cost-effective service on a schedule that makes it convenient for them

to complete round-trip, same-day travel to and from Honolulu and Kahului.

It is our belief that Mokulele is uniquely qualified to serve this route for the following reasons:

• On-time performance and reliability. Mokulele operates more than 120 flights per day

and we have consistently maintained dispatch reliability and on-time departure ratings in

the mid-ninety percent range.

• Modern fleet. In 2013, we invested $22 million to add nine brand new nine-passenger

Cessna Caravan aircraft to our fleet. This is part of our commitment to operate the

youngest fleet of any Hawai'i carrier operating under either Part 121 or Part 135 of the

Federal Aviation Regulations (FARs). By the end of the first quarter of2014, Mokulele

Airline's fleet will consist of all 2013 model aircraft, the oldest of which will not yet have

seen one year of service. Our newest aircraft are the Cessna Grand Caravan EX model

with the larger, 867 horsepower engine which enhances operational safety with greater

climb gradients, faster speeds and more available excess power in the event of an

emergency.
• Extraordinary focus on safety. Mokulele Airlines has voluntarily adopted the FAA's

"One Level of Safety" philosophy and has committed to operating its aircraft far beyond

the minimum standards of Part 135. First of all, we have taken the important step of

mandating that all of our revenue flights will be operated with a two-pilot crew, even

though this is not required by the FAA. In addition:

oWe schedule pilots under strict crew rest requirements, well beyond the

mnumums.

o We train our pilots to utilize the most current principles of Cockpit Resource

Management (CRM) and mandate the use of written checklists for normal,

abnormal and emergency operations.

oWe require that every passenger flight be operated under Instrument Flight Rules

(IFR) under the guidance and supervision of the Air Traffic Control system which

mandates safer routings, continuous communications from takeoff to landing,

higher altitude minimums, greater terrain clearances, radar tracking and higherthan-minimum pilot qualifications.

o We have been approved to use the same Electronic Flight Bag (EFB) program

used by the largest air carriers, which places every operational document in the

hands of the pilots during every moment of flight.

o We operate a sophisticated flight tracking system, including a dispatch office

located in our Kona System Operations Center (SaC).

o We have initiated meetings with Air Traffic Control (ATC) management and line

controllers with the goal of fostering a better understanding and awareness of the

unique safety requirements of safely operating single-engine turbine aircraft in the

mountainous, open-ocean environment of Hawai'i.

• Strong, proactive commitment to aircraft maintenance. We have established

maintenance operations in Kona, Kahului and Honolulu, and we have made a significant

investment in training our mechanics and in upgrading our tooling and support of our

engines.

• EAS track record. In September of 20 13, we were awarded the essential air service

contract for Kamuela, and in the first month of operations, we carried more passengers in

and out of Kamuela than the previous carrier had over a 12-month period. Interest in this

route is so high that we are now planning to add a third flight per day. Our service to
Hana, which we launched in 2012, is another success story about the importance and

value of meeting the needs of an underserved market.

• Excellent customer service. All eight of Mokulele Airlines' stations are staffed by

trained Customer Service Agents (CSAs) to enhance safety, customer service and aircraft

handling. We have also made additional investments in our information technology and

reservations systems to ensure that we maintain a high level of service to our customers.

• Global distribution. We have a global distribution system that makes it convenient for

I

passengers to make reservations through traditional travel agents as well as through

online travel booking sites.

• Strong management team. We have established an experienced, cohesive and proactive

management team to support our flight operations and ensure a positive passenger

expenence.

• Community support. When I purchased Mokulele in 2011, the airline was serving 7,000

passengers per month. Due to the growing demand for our flights, we now serve more

than 21,000 passengers per month who are traveling to eight destinations on five islands.

We believe this is a strong testament to the trust and confidence Hawai'i residents

continue to place in Mokulele. In addition, as the largest carrier serving Ho'olehua

Airport, we already have significant experience serving the residents of Moloka'i.

We appreciate the opportunity to bid on serving the Kalaupapa essential air service route. We

also respect your recent decision to extend Makana Kai' s current contract until May 31st to give

you sufficient time to evaluate all of the critical safety, service and reliability factors involved in

choosing a carrier.

Thank you again for this opportunity. We would be honored to be awarded this contract and we

are prepared to begin daily service to meet the needs of the residents of Kalaupapa and the

visitors who desire to visit this significant landmark in Hawai'i history.

Respectfull y,

'Ro-vvfl~

CEOlPresident

Cc: Scott Faulk