2010-7-12

Served: July 15, 2010

UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY

WASHINGTON, D.C.

Issued by the Department of Transportation

on the 15th of July, 2010

Essential Air Service at

GREENVILLE, MISSISSIPPI

Under 49 U.S.C. 41731 et seq. 

DOCKET OST-2008-0209

ORDER RESELECTING CARRIER

Summary

By this order, the Department is selecting Mesaba Aviation, Inc., d/b/a Delta Connection, 

(Mesaba) to provide essential air service at Greenville, Mississippi, at an annual subsidy rate of 

$1,606,6621 thru September 30, 2011, or 180 days after Mesaba informs the Department of the 

retirement of the Saab aircraft Mesaba proposed for this service, whichever comes sooner.

Background

Order 2008-8-23, August 25, 2008, selected Mesaba to provide 14 nonstop round trips per week to 

Memphis with 34-seat Saab 340 aircraft, for the two-year period ending September 30, 2010, at 

the annual subsidy rate of $1,355,693. In anticipation of the end of the current contract on 

September 30, by Order 2010-5-2 we requested proposals for replacement service, with proposals 

due June 3. We received timely filed proposal from two carriers, Alaska Juneau Aeronautics, Inc., 

d/b/a Seaport Airlines (SeaPort), and Mesaba, and requested comments from the community. On 

June 23 we received comments from the community, and the issue is ripe for decision. 

SeaPort

SeaPort proposes to provide a total of thirty (30) nonstop round trips per week: twelve to New 

Orleans and eighteen to Memphis – for a total annual subsidy of $2,339,882 the first year and 

$2,409,325 the second year. All service would be with 9-seat, single-engine, pressurized, 

turboprop Pilatus PC-12 aircraft.

 

1 Such subsidy is calculated and distributed on a fiscal year basis, subject to the availability of appropriated funds.
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Mesaba

Mesaba proposes to continue its current level of service – fourteen nonstop round trips per week 

to Memphis – for a total annual subsidy of $1,606,662. All service would be with 34-seat 

Saab 340s, a twin-engine, turboprop, and pressurized aircraft. As part of its proposal, Mesaba 

indicated that it would be:

“retiring its fleet of Saab 340 aircraft before the end of 2011, and therefore cannot commit to a 

..... standard 2-year period. Accordingly, Mesaba hereby amends its proposal to stipulate an 

end to the proposed subsidy rate on the earlier of October 1, 2011, or 180 days after Mesaba

informs the Department of the retirement of the Saab aircraft used for this service. At the 

appropriate time, Mesaba intends to submit a new bid proposal based on the aircraft that are

available [at the time] in Mesaba's fleet.”

Community Comments

On June 10 we requested community comments regarding the carrier selection at Greenville. We 

received a joint comment from the mayor and airport manager. The community indicated they

had examined the SeaPort proposal, and, although they appreciated that carrier’s potential for 

providing them service, they thought that Mesaba was a better choice for them at this time. 

Decision

We have reviewed each carrier’s proposal and the community’s comments, and have decided to 

select Mesaba. This case is straightforward. As we noted in our letter to the community, 

Greenville’s EAS calls for service with 15-seat, twin-engine aircraft, “Thus it is likely we would 

only select SeaPort if the community waives those assurances.” The community has not waived 

those assurances, Mesaba’s proposal appears reasonable for the service it proposes, and so we 

will reselect Mesaba.

Mesaba conditions its proposal on being selected for something less than the typical two-year 

period. As Mesaba indicates, we typically select a carrier for two-year periods, balancing the 

needs of the carrier and community for a reasonable planning period, against the need to 

discipline program costs through the competitive-bidding process. However, nothing requires us 

to select a carrier for a two-year period, and so we will select Mesaba for the period October 1, 

2010, thru September 30, 2011, or for up to 180 days after it files a notice to terminate service, 

whether due to its anticipated disposal of its fleet of Saab 340 aircraft, or any other reason, 

whichever occurs sooner.

2 Also, we note that any Mesaba notice to suspend service would not 

obviate its requirement to continue to provide EAS during our processing of a carrier-selection 

proceeding.

Carrier Fitness

49 U.S.C. 41737(b) requires that DOT find an air carrier fit, willing, and able to provide reliable 

service before DOT may subsidize it to provide essential air service. Mesaba Aviation, Inc., is 

subject to the Department’s continuing fitness requirements, and no information has come to our 

 

2 In the event Mesaba does not dispose of its Saab 340 aircraft or file a notice, we would consider extending this 

contract for the typical two-year period, thru September 30, 2012, after consulting with the carrier and community. 
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attention that would cause us to question the carrier’s fitness at this time. DOT has contacted the 

Federal Aviation Administration, and it has raised no concerns that would negatively affect our 

fitness findings. DOT therefore concludes that the carrier remains fit to conduct the operations 

proposed here.

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

ACCORDINGLY,

1. We select Mesaba Aviation, Inc., d/b/a Delta Connection, to provide essential air service at 

Greenville, Mississippi;

2. We set the final rate of compensation for Mesaba Aviation, Inc., for the provision of essential 

air service at Greenville, Mississippi, as described in Appendix C;

3. We direct Mesaba Aviation, Inc., to retain all books, records, and other source and summary

documentation to support claims for payment, and to preserve and maintain such documentation 

in a manner that readily permits its audit and examination by representatives of the Department. 

Such documentation shall be retained for seven years or until the Department indicates that the 

records may be destroyed, whichever comes first. Copies of flight logs for aircraft sold or 

disposed of must be retained. The carrier may forfeit its compensation for any claim that is not 

supported under the terms of this order;

4. We find that Mesaba Aviation, Inc., continues to be fit, willing and able to operate as a 

certificated carrier and capable of providing reliable essential air service at Greenville, 

Mississippi; 

5. This docket will remain open until further order of the Department; and

6. We will serve copies of this order on the Mayor and Airport Manager of Greenville, 

Mississippi, Alaska Juneau Aeronautics, Inc., d/b/a Seaport Airlines, and Mesaba Aviation, Inc.

By, 

Susan L. Kurland

Assistant Secretary for

Aviation and International Affairs

(SEAL)

An electronic version of this document is available on the World Wide Web at

http://www.regulations.gov
Appendix A

Nonstop, Great Circle Miles from Greenville (GLH)

Atlanta, ATL 378

Memphis, MEM 122

New Orleans, MSY 245

Jackson, JAN 97

Birmingham, BHM 244

Columbus, GTR 138

Hattiesburg, PIB 169

This map is provided by Sabre® AirVisionTM Profit Essentials and is being used with express permission of the copyright holder, 

Sabre Airline Solutions®.
Appendix B

Proposal of Mesaba Aviation, Inc., Essential Air Service at 

Greenville, Mississippi, Docket 2009-0209

Round trips per Week 14

Passengers 9,913

Block Hours 1,272

Departures 1,416 1/

Completion Factor 0.97

Passenger Revenue $743,505

Other Revenue $93,777

Total Revenue $837,282

Pilots $318,023

Fuel $318,426

Maintenance $545,856

Aircraft $289,044

 Total Directs $1,471,349

Total Indirects $839,709

Total Operating $2,311,058

Inflation @ 0.75% $17,333

Profit at 5% $115,553

Economic Cost $2,443,944

Annual Subsidy $1,606,662

1/ 28 one-way flights per week x 52 weeks * 0.97 completion x 365/364 days.
Appendix C

Mesaba Aviation, Inc., Inc., Essential Air Service to be Provided to 

Greenville, Mississippi, Docket OST-2008-0209

Effective Period: October 1, 2010, thru September 30, 2011, or 180 days Mesaba files notice to suspend 

service with Saab 340 aircraft due to termination of that aircraft type, whichever comes sooner.

Scheduled Service: 14 nonstop round trips per week to Memphis.

Aircraft: Saab 340, 34 seats.

Rate per Eligible Flight: $1,135 1

Weekly Ceiling: $31,780 2

Note: 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, such 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 this rate, 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; flights 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 extent 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 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.

Subsidy contract 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 paragraph.

Funds are not currently available for performance under this order beyond September 30, 2010. The Government’s 

obligation for performance under this order beyond September 30, 2010, is subject to 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 September 30, 2010, until funds are made available to 

the Department for performance. If funds are not made available for performance beyond September 30, 2010, the 

Department will provide notice in writing to the carrier.

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

 

1 Annual compensation of $1,606,662 divided by 1,325 estimated annual completed departures and arrivals: 

28 one-way flights/week x 52 weeks x 97 percent completion x 365/364 days = 1,416 departures per year.

2 28 flights/week x $1,135.