Springfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 APPLICATION UNDER
SMALL COMMUNITY AIR SERVICE DEVELOPMENT PROGRAM

DOCKET DOT

- OST

- 2014

- 01 1 3

SUMMARY INFORMATION

A. P ROVIDE THE LEGAL SPO NSOR AND ITS DUN AND BRADSTREET (D& B) DATA UNIVERSAL NUMBE RING SYSTEM (DUNS)

NUMBER , INCLUDING +4, EMPLOYEE IDENTIFICAT ION NUMBER (EIN) OR TAX ID

. Legal Sponsor Name: Springfield Abraham Lincoln Capital Airport Name of Signatory Party for Legal Sponsor: Mr. Mark Hanna, Executive Director
DUNS Number:
782263383 EIN/Tax ID:
37

- 6002051

B. L IST THE N AME OF THE COMMUNITY OR CONSORTIUM OF COM MUNITIES APPLYING : 1. S PRINGFIELD , I LLINOIS

C. P ROVIDE THE FULL AIRP ORT NAME AND 3

- L ETTER IATA A IRPORT C ODE FOR THE APPLICAN T ( S ) AIRPORT ( S ) (O NLY

PROVIDE CODES FOR TH E AIRPORT ( S ) THAT ARE ACTUALLY SE EKING SERVICE ).
1. Springfield Abraham Lincoln Capital Airport
SPI

D OES THE AIRPORT SEEK ING SERVICE HOLD AN AIRPORT OPERATING CE RTIFICATE ISSUED BY THE F EDERAL A VIATION A DMINISTRATION UNDER 14 CFR P AR T 139? (I F “ NO ,” PLEASE EXPLAIN WHETH ER THE AIRPORT INTEN DS TO APPLY FOR A CERTIFICATE OR WHETH ER AN APPLICATION UN DER P ART 139 IS PENDING .)

Yes No (explain) 

### XSpringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014

D. L IST THE 2

- DIGIT CONGRESSIONAL DISTRICT CODE APPLIC ABLE TO THE SPONSORI NG ORGANIZATION , AND IF A

CONSORTIUM , TO EACH PARTICIPATIN G COMMUNITY

. 1. IL

- 1 8

E. A PPLICANT I NFORMATION : (C HECK A LL T HAT A PPLY )

Not a Consortium Interstate Consortium Intrastate Consortium Community now receives subsidized Essential Air Service Community (or Consortium member) previously received a Small Community Air Service Development Program Grant
If previous recipient: Provide Year of grant(s): 2006 and 2008 and 2012
a nd, the te x t of the Grant agreement section(s) setting forth the scope of the grant project:

2006

– Increase enplanement at (SPI) Airport, strengthen existing carriers serving the airport, begin nonstop service to Washington D.C., and open up the airport to new one

- stop....routes 2008

– To provide central Illinois & SPI a 3rd option to a n airline hub offering connections to SPI’s top O&D markets, incr e ase awareness about local air service, increase capacity and lower fares 2012

– Secure and support new nonstop low

- cost service SPI to leisure destinations via ground handling cost offsets and a targeted marketin g program.

F. P UBLIC /P RIVATE P ARTNERSHIPS : (L IST O RGANIZATION NAMES )
PUBLIC PRIVATE
1. City of Springfield 1. The Greater Springfield Chamber
2

. Sangamon County 2. The Quantum Growth Initiative (Q5)
3. T HE S PRINGFIELD A IRPORT A UTHORITY 3. C RAWFORD M URPHY AND T ILLY

4. 4. Hanson Professional Services

G. P ROJECT P ROPOSAL : 1. G RANT G OALS : ( CHECK ALL THAT APPLY )
Launch New Carrier Secure Additional Service Upgrade Aircraft
First Service New Route Service Restoration Regional Service Surface Transportation Professional Services Other (explain below) Community Engagement Project; 1 to 1 en g agement with key local travel generators, develop long term awareness campaign, improve social media presence, community video, travel agent engagement, enhanced website 

### XSpringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 2

. F INANCIAL T OOLS T O B E U SED : ( CHECK ALL THAT APPLY )

Marketing (including Advertising): prom otion of the air service to the public
Start

- Up Cost Offset: offsetting expenses to assist an air service provider in setting up a new station and starting new service (for example, ticket counter reconfiguration)
Revenue Guarantee: an agreement with an air service provider setting forth a minimum guaranteed profit margin, a portion of which is eligible for reimbursement by the community
Recruitment of Air Carrier: air service development activities to recruit new air service, including expenses for airport marketers to meet with air service providers to make the
case for new air service
Fee Waivers: waiver of airport fees, such as landing fees, to encourage new air service;
counted as in

- kind contributions only
Ground Handlin g Fee: reimbursement of expenses for passenger, cabin, and ramp (below wing) services provided by third party ground handlers
Travel Bank: travel pledges, or deposited monetary funds, from participating parties for the purchase of air travel on an air car rier, with define d procedures for the subsequent

use of the pledges or the deposited funds; counted as in

- kind contributions only
Other (explain below) Community engagement, 1 to 1 with key travel generators, social media development, long
term market awa reness project, community video, airline liaison on marketing and promotion, enhanced airport website

H. E XISTING L ANDING A IDS AT L OCAL A IRPORT : Full ILS Outer/Middle Marker Published Instrument Approach
Localizer Other (specify)Springfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014

I. P ROJECT C OST : D O NOT ENTER TEXT IN SHADED AREA
L INE D ESCRIPTION S UB T OTAL T OTAL A MOUNT
1 Federal amount requested $ 18 2,500
2 State cash financial contribution $0
Local cash financial contribution
3a Airport cash funds $ 5,00 0
3b Non

- airport cash funds $ 5 2,500
3 Total local cash funds ( 3a + 3b ) $ 5 7,5 00
4 TOTAL CASH FUNDING ( 1+2+3 ) $ 240,000
In

- Kind contribution
5a Airport In

- Kind contribution** $25,000
5b Other In

- Kind contribution** $40,000
5 TOTAL IN

- KIND CONTRIBUTION ( 5a + 5b ) $65,000
6 TOTAL PROJECT COST ( 4+5 ) $ 305,000

J. IN

- KIND CONTRIBUTIONS** For funds in lines 5a (Airport In

- Kind contribution) and 5b (Other In

- Kind contribution), please describe the source(s) of fund(s) and the value ($) of each. Airport In

- Kind contribution is utilization of airport owned marketing assets

. Other In

- Kind contribution is chamber of commerce marketing assets and staff

, and financial co

op advertising and awareness with private local media

.

K. I S T HIS A PPLICATION S UBJECT T O R EVIEW B Y AN AFFECTED S TATE U NDER E XECUTIVE O RDER 12372 P ROCESS ?

a. This application was made available to the S tate under the Executive Order 12372 Process for review on (date) _____________.
b. Program is subject to E.O. 12372, but has not been selected by the S tate for review.

c. Program is not covered by E.O. 12372.

L. I S T HE L EAD A PPLICANT OR ANY C O - A PPLICANTS D ELINQUENT O N A NY F EDERAL D EBT ? (I F “Y ES ”, P ROVIDE
E XPLANATION )
No Yes (explain)

_____________________________________________________________________________________________S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 1

TABLE OF CONTENTS

Legal Sponsor 1
Introduction 2 Location, Population and Economy 3

- 4
Current and Historical Air Service 5

- 7
Air Service Needs and Deficiencies 8

- 1 2 Air Service Development Plan and Implementation Timeline 1 3

- 1 5 Public/Private Partnership 1 6
Air Service Development Efforts 1 6

- 17
Previous Grant Award s 18

- 19
Conclusion 19



## LEGAL SPONSOR

The Springfield Airport Authority

– Springfield, Illinois is the legal sponsor responsible for administering the proposed Grant and air service development program. The Airport is a government agency

.
Springfield Airport Authority 1 200 Capital Airport Drive Springfield, Illinois 62707 Mr. Mark Hanna, Executive Director ( 217

- 788

- 1060 X 2211 

### mhanna@flyspi.com Section Page NumberS pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 2

INTRODUCTION

The Springfield, Illinois Abraham Lincoln Capital Airport has seen significant declines in network carrier capacity (measured in both seats available and flights offered) since 2009. The declines
are on both ou r United Express service to Chicago (ORD) and our American Eagle (Envoy) service to Dallas (DFW). At the same time exhaustive research and study of our air service market indicates very solid traffic demand in our catchment area. The clear conclusion from
these two facts is that our local air network service is in decline while our local DEMAND for network air service is increasing.

Our estimated total network carrier seat count in 2013 will be 159,000 seats while in 2009 it was 190,243, a decline of 16.4% . Our estimated total network carrier flight count in 2013 will be 3, 225 while in 2009 it was 3,914, a decline of 17.6%.

The 16% decline in network seats and 17% decline in SPI network flights puts the viability of our long term network air service in jeo pardy, given 50

- seat RJ retirements and competition from nearby and larger airports.

Springfield is the state capital of Illinois, a growing and prosperous community of 212,081 MSA population. Network air service is essential to the continued growth of our community . Yet, while
our traffic demand measur ed by the leakage report continues to grow, our network air service
continues to decline. In order to address this decline in network air service

, we believe that we have to aggressively engage our local c ommunity, its residents, its companies and institutions and fully market and promote the air service we have, with the intention of increasing traffic to the point that our incumbent carriers can justify reinstating seats and flights that we have lost in
t he past five year s

.

This SCASD Grant funding proposal is for an innovative community engagement program, designed to engage our community at all levels and across both traditional and new media venues. Our proposal calls for $18 2,500 in DOT Grant funds, t o be matched by $5 2,500 in non

aeronautical local funding , $5,000 in Airport funding and $65,000 in in

- kind contributions, making a total Grant funding of $240,000 in cash plus the $65,000 in

- kind amount for a total of $305,000

. This document outlines in d etail the exciting concepts of this community engagement proposal. 

### “ The 16% decline in SPI network seats and 17% decline in network flights puts the viability of our long term network air service in jeopardy, given
50

- seat RJ retirements and competition from nearby and larger airports.”S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 3

LOCATION, POPULATION AND ECONOMY

Market Location and Population

– Springfield is located in central Illinois about midway between St. Louis on the south and Chicago on the north. The City and its Airport sit at the junction of I

- 55
and I

- 72 as well as state highways 29,
54 and 125.

The City of Springfield had a 2013 population of 117,006, up 2% from 2004. Springfield is the second largest city in Illinois outside of the Chicago
metro area. The Springfield MSA had a 2013 population of 212,081 , up 6%
since 2004. The one hour drive radius from the airport (shown in red) has a population of 417,451 and the two hour drive radius has a population of nearly 3.3 million, owing to inclusion of
much of the St. Louis metro area.

There are six air service airports within a two hour drive of Springfield. St. Louis Lambert is just under two hours’ drive, although it can be much longer depending on time of day and St. Louis metro area traffic congestion. Bloomington, Champaign
and Peo ria are between 1:13 and 1:38 freeway drive to the north or east. EAS airports Decatur and Quincy are one hour and two hours respectively from Springfield.

The city, M SA and regional population growth over the past eight years, including a brutal
recessi on, defy the national trend of rural population decay and confirm the strong economic growth of Springfield and its surrounding area.

Key sectors of the Springfield area economy include the State Government of Illinois, the Illinois
Nation al Guard headquarters, a large cluster of healthcare facilities and higher education facilities. Key private employment sectors include insurance, banking, telecommunications andS pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 4

light manufacturing. The diversity of the Springfield economy and orientation toward the healthcare, insurance , higher education and government sectors means that the area was able to navigate the great recession of 2008

– 2009 relatively well. Indeed, in May of 2014, the Springfield MSA unemployment rate w as 6.0% , tied
for the lowe st in the entire state of Illinois with Bloomington/Normal and well below the state average of 7.5%. This means that the MSA has trimmed its unemployment rate from the recession peak of 9.9% in February 2010 to 6.0% in only a little over four years.

The higher education sector of the local economy features nine colleges and universities within a 90 minute drive of the Springfield Airport. These institutions employ about 20,785 faculty,
administration and staff and have about 99,000 under and post grad
st udents enrolled in a typical year.

The final key sector of the Springfield MSA economy is one not typically associated with a rural Midwestern city, tourism. Springfield is a tourism destination in its own right. Eight major local
tourism sites document a nd honor the life and times of Abraham Lincoln. In 2013 just over 2.2
million individual tourist visits were recorded at these eight sites, an average of just over 6,000 per day.
Springfield’s economy is healthy and growing. Network carrier air transporta tion is absolutely essential to the continued health and growth of that economy. The trend of network air service flight frequency and seat capacity reductions is a direct contradiction to local economic growth and a threat to the continuation of that econ omic growth.S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 5

HISTORICAL AND CURRENT AIR SERVICE

Traffic and Service History

– Springfield can trace its air service routes all the way back to 1928. There actually was no local air service from 1939 until 1947 due to, initially, the lack of an adequate airport and then World War II related delays in building an adequate airport until
1947. Local air service has been continuous since that time and was for many years provided by Ozark Airlines. Today Springfield is served by three airlines; daily service from network carriers United Express (SkyWest) to Chicago and American Envoy to Dallas and low cost carrier Allegiant Air with less

- than

- daily serv ice to Punta Gorda and Orlando Sanford.

SPRINGFIELD TOTAL ON/OFF ANNUAL PASSENGERS 2004

- 2013

In t he past ten years Springfield total traffic has dropped from 222,900 in 2004 to 144,853 in 2013

, a decline of 35% in a decade. And the 2013 traffic number is up significantly from our low point of 113,199 in 2008. It has been a turbulent decade for Springfield air service ; the closure of the
American Airlines hub in St. Louis mid

- decade devastated our air service

, and it has been a constant struggle to rebuild it and retain what we rebuil t since then.

The significant decline in Airport traffic is explained by the dramatic decline in service, measured both in terms of available seats and flight schedules operated

. The following cha rts summarize SPI air service by route and include the services of Direct Air on three routes in years 2009 to 2012

.S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 6

Measured in flights operated per year, Springfield air service is down
60.3 % in 2013 compared to 2004. Total flight segments operated per year has declined every year except 2010 and 2012

. If only network carrier flights are counted, 2013 had 3,529 (ORD + DFW) whereas 2004 at 9,386, a decline of a shocking 62%.

The same trend is clear in annual capacity, measured in seats offered on ea ch route each year. For the ten year period SPI seat capacity is down 44.1%. Seat capacity has declined every year except 2008, 2010 and 2011.

Again, if only network seats are counted 2013 had 170,542 (ORD + DFW) whereas 2004 had 362,804, a
decline of a full 53%.

Springfield airfare pricing trends show significant increases in average fare paid in the past ten
years , both in simple increase and relative to the national average for domestic fares.

It is important to note that an accurate reading of Spri ngfield domestic average fares must exclude Chicago ORD traffic, revenue and average fare. For many years and until just recently, SkyWest, the at

- risk United Express carrier in the SPI

– ORD market has employed a very low Chicago local fare structure. Thi s structure was designed to create sum

- of

- two

- local fare booking options in instances where the published thru fare of United Airlines (who controls connect pricing in at

- risk markets) was publishing what SkyWest deemed were non

- competitiveS pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 7

thru fares. For some years now the SPI

– ORD local passenger count would be disproportionate to its true value in that many passengers shown as local were actually sum

- of

- two

- locals connect passengers recorded as locals. Excluding these passengers gives a true picture of what SPI market passengers were paying for connection travel via ORD.

Springfield’s current air service ( summer of 2014 ) consists of three times daily United Express 50

- seat regional jets to ORD, American Envoy 50

- seat regional jets twice daily to DFW an d less

- than

daily (twice per week) Allegiant Air MD80 service to Punta Gorda and Orlando Sanford. Both Punta Gorda and Sanford service is suspended for several months each year in late summer and early fall.

The decline in Springfield network air service measured both in terms of flight frequency and seats offered, is alarming. Industry consolidation has reduced the number of network carrie r s and regional fleet composite shifts mean that markets like Springfield must either grow to support
66 and 7 6

- seat aircraft or risk the loss of all network service.S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 8

AI R SERVICE NEEDS AND DEFICIENCIES

The Springfield Abraham Lincoln Capital Airport has seen a huge decline in air service in the past ten years, measured in terms of both seat capacity (

- 60%) and f requency of flights (

- 44%)

. But even more important than the overall seat and flight frequency declines, is the specific decline
of network carrier service

.

Springfield is a city of government, education and business. Network air service with global

conne ctivity is essential to the operation of those functions and to the growth of local business and industry. Yet the decline in Springfield network airline service is even worse than the overall declines already documented.

When only network carrier service is considered the Springfield market has lost 6 2.4 % of its flight frequency in ten years and 65.2% in eleven years if 2014 projected results are included. This compares to a loss of 60.3% of seats in ten years for all carrier service.

When only network carrier service is considered the Springfield market has lost 53% of its seat capacity in ten years and 56% in eleven years if 2014 projected service results are included. This compares to a loss of 44.1% of seats in ten years for all carrier serv ice.S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 9

Springfield’s network air service average fare is significantly above that of the national average

, and significantly above that of nearby St. Louis (primary leakage point)

, and often the highest among its peer group of cities in central Illinois.

The first four data lines of the chart compare SPI’s domestic average fare to that of the national average, with the SPI

– ORD city pair removed for clarity and Allegiant Air results removed from both average fare numbers. Allegiant has generated significa nt traffic at SPI in recent years and inclusion of that carrier’s average fare would dilute SPI’s domestic average unfairly given that Allegiant only serves two Florida cities from SPI but generates disproportionate traffic at low fares
on those two routes . The chart shows that SPI’s core domestic average fare was 18.6% higher than the national average fare (adjusted for Allegiant in both cases) in 2013.

The middle four lines of data show the SPI core domestic fare compared to the same fare at St.
Louis. Where the difference was only $1.57 and 1.1% in 2004

, in 2013 it is $53.33 and 23.6%.

The final four data lines show the core domestic average fare (excluding AirTran, Frontier and Allegiant) at SPI against its peer group; Bloomington, Champaign and Peoria. In three of the last ten years SPI has had the highest core domestic fare in the group and in two years, including 2013 the SPI fare was the second highest in the group.S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 10

The clearest demonstration of Springfield’s air service deficiencies is found in the data from a comprehensive True Market Study done in 2013. Parameters of the study were;

 Used an 11 county catchment area with a combined population of 470,517
 Studied traffic demand in the catchment area for the 12 months ended 3/31/2013.
 Sampled 24,972 catchment area tickets
 Three part analysis; ARC ticket sample, DOT data analysis and macroeconomic formulas

Conclusions of the study include;

 SPI gained 9.2% of area domestic traffic
 STL gained 45.3% and ORD 27.1%
 MDW gained 10.9%
 BMI captured 1. 2%, down from 11.4% in a 2010 analysis, showing market shifts from AirTran’s BMI market exit.
 Average fare paid at SPI was $210.
 Average fare at STL $165, $45 lower.
 Average fare at ORD was $179, suggesting ORD driving was not primarily
fare driven as the savings of $31 are not significant compared to the distance of
drive to ORD.
 SPI gained 16.7% of international traffic
 ORD gained 64.8% and STL 16.1%
 Pricing was not a factor in international leakage.
 For all traffic SPI gained 9.5% , leaking 90.5% of its catchment area true demand to other airports.
 STL gained 43.9% and ORD 28.9%
 MDW gained 10.4%S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 11

Average Fare and Leakage

– T he chart at the right more clearly illustrates the role that average fare plays in domestic traffic leakage from the SPI catchment area.

The average fare paid at the SPI airport during the study period was $210, which is 21.4% higher than at STL, 14.8% higher than at ORD and 33.8% higher than at MDW. On the international side, with the exception of traffic leaked to MDW, fare was no t a driver of leakage.

For domestic traffic, none of the price gaps, by themselves, represent a major customer savings after the cost of driving (auto costs, time costs and parking costs) are factored in. And price in not a driver of any international lea kage except that to Midway Airport.

Carrier Preference and Leakage

– Three carriers captured significant shares of Springfield catchment area true traffic demand in the study period.

Southwest Airlines captured 35% of total demand mostly at St. Louis bu t also at Chicago Midway.

United captured 23% of catchment demand, but only 6% of that demand
boarded United at Springfield; the rest
dr ove to use United service at other airports.

American captured 19% of catchment demand, but only 3% of that boarded Am erican at Springfield, the rest drove to use American s ervice at other airports.

Airline Capacity and Traffic per Capita

– One common measurement of local air service is airline capacity (seats) per capita and airline passengers per capita at the local ai rport and in comparison to peer airports and primary leakage airports.S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 12

By these measures Springfield does poorly compared to its peer group (except Champaign) and in comparison to St. Louis, its primary leakage point and nearest large airport.

In the seat s per capita column, Springfield has the second lowest count per capita at .98. In the O&D per capita (measuring domestic passengers) Springfield again has the second lowest count per capita, essentially tied with Champaign at .63 domestic O&D per MSA capi ta.

In summary, network air service at Springfield , measured in flights offered and seats offered, is in decline and that decline is in direct contradiction to the growth in local population and economic output. Furthermore, a detailed study of true traffic demand in the Springfield catchment area shows that the local airport is only capturing 9.5% of catchment area true traffic demand. This means that 90.5% of air travel from the catchment area uses another airport.

It is completely understandable that while 35% of true demand uses Southwest Airlines at another airport it is startling to note that 42% of catchment area true demand uses United and American Airlines service for travel, but that only 9% of that true demand uses those carriers at the local airport.

With mergers having reduced the number of conventional network carriers to just three and those three carriers reducing 50

- seat fleets, it becomes critical for small and medium sized airports to fill the seats on their network flights and grow their network traffic to levels that can support, in a few years, larger regional jet equipment. The a lternative to accomplishing network traffic growth is a day of reckoning for network service, a day when 50

- seat gauge service is no longer viable. If larger RJ service cannot, at that time be justified, network carrier service is in jeopardy at that airpo rt. Springfield believes that scenario is possible locally and we are energized to recapture leaked traffic to our existing network service so that lost flight frequency and seat capacity can be restored.S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 13

The Springfield Abraham Lincoln Capital Airport Authority has developed a comprehensive Plan to reverse documented traffic leakage and increase Airport airline traffic and revenue. The
increased traffic will drive reinstatement of lost networ k carrier capacity and, in time, become a
self

- supporting cycle of recaptured local traffic leakage driving additional capacity additions, driving more recaptured traffic.

This P lan is called an “Air Service Community Engagement Project”.

The Core Elemen ts of the Plan are;
A. One to one outreach visits with key community leaders and corporate travel generators
B. Improve social media presence
C. Implement a sustained (2

- 3 year) awareness campaign using traditional and social media
D. Produce a community airport and air service video
E. Comprehensive local travel agent engagement to reinforce a “fly local” concept
F. Expanded engagement with incumbent carrier sales and marketing representatives
G. Rebuild and enhance Airport website
H. Refinement of Airport brand and projection of that brand region wide
I. Set specific and measurable goals for reversing catchment leakage
J. Ongoing true market study snapshots to define progress in leakage reversal

The core elements will be implemented via a step

- by

- step process of community engagemen t;

 Reviewing current marketing plan for the Airport to evaluate goals for the program;

 Refine existing air service marketing/advertising material s ;

 Media outreach (including outreach to communities at other end of route(s));

 Corporate Travel Outreach (incl uding meetings with top companies in region to discuss airport air service offerings and identify opportunities for traffic recapture and re tention;

 Development of more effective Airport communications (internal and external);

 Participating in marketing s ales events for the Airport within the region;

 Developing route specific marketing strategy tactics and promotions to stimulate interest in new routes and air service development efforts within the market;

 Work with marketing/ sales teams at Airline partner s to ensure cross

- promotional efforts;

 Identifying unique marketing and partnership opportunities. 

## AIR SERVICE IMPROVEMENT PLAN, FUNDING AND IM PLEMENTATIONS pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 14

One fundamental key to any community engagement program is the ongoing measurement of success or failure, which allows for course adjustments toward successful program elements and away from unsuccessful program elements.

Program Effectiveness Measurement

– T his community engagement program will measure every element of every initiative on an ongoing basis.

 Tabulation of one to one outreach visits wit h grading of effectiveness of visit

 Standard measures of social media penetration and presence

 Annual survey of airport and local air service awareness among target audiences

 Tracking of the uses of the Airport and air service video

 Tracking of catchment area travel agent engagement events and quarterly survey of travel agent community sentiment and booking (airport of use) patterns

 Tabulation of contact with incumbent carrier sales and marketing representatives

 Timeline for website reconstruction and grap hing of consumer use pre and post redesign

 Quarterly survey of target audience perception of Airport brand

 Bi

- annual True Market Study updates to survey overall catchment area demand and airport and carrier preference shifts

Funding Plan

– The Airport Authority and its community partners propose a total Grant funding level of $ 305,000 . The DOT funding contribution would be $18 2,500 , matched by $5 2,500 in non

aeronautical funds from Springfield , $5,000 in Airport funds and $65,000 of in

- kind funding from
three local sources.

Grant Implementation Timeline

– The Airport and its community partners anticipate very prompt implementation of the Air Service Community Engagement Project upon Grant award and contract completion. We anticipate full use of the Gran t funding in eight quarters beginning fourth quarter of 2014 and completing Grant funding program in third quarter of 2016. We believe that this Program will measurably increase Airport enplanements and, via the Airport revenue increases propagated by incr eased enplanements, this Community Engagement Program will become self

- sustaining.S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 15

The Grant implementation timeline assumes Grant award and Grant contract execution in late
third (calendar) quarter of 2014. Based on that starting point the timeline defines major initiatives by quarter for an eight quarter period. As elements of the plan roll out they do continue quarter to quarter. Comprehensive measurement of effectiveness occurs every six months in the
program.

Th is Community Engagement Program w ill have a goal of increasing Airport network carrier enplanements year over year by 3% per quarter beginning in first quarter of 2015. This means that the program will achieve at least 1,135 add ed network carrier enplanements in 2015 Q1
based on 2014 Q1 r esults.S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 16

SPRINGFIELD’S PUBLIC PRIVATE PARTNERSHIP

The Springfield Airport Authority is very active in air service retention, enhancement and new service recruitment. The Authority works closely with both public sector and private sector partners on air service matters. The Authority has formed a strong public private partnership for
air service retention and recruitment efforts.

Thanks to an active local public private partnership the Airport Authority has successfully administered three previous
SCASD Grants and undertaken other air service related projects.



## AIR SERVICE DEVELOPMENT EFFORTS

The Springfield Airport Authority is very active in air service development. The Airport’s Executive Director retains close contact with representatives of each incumbent airline, attends multiple air service development conferences annually and retains a well

- known Air Service Consulting firm to assist with research, carrier liaison and business case development and presentation. In the past three years 2011

– 2 013 the Airport has spent approximately $120,000 on air service conference attendance and related travel, consultant retainer fees and research or business case documents. A year by year detail of formal air service development efforts are below;

2011: February

– Springfield Ticket Lift and True Traffic Demand and Leakage Study completed February

– Attended Network USA
, presented to Southwest, Vision, Branson Express, Spirit

, Allegiant Air, Pinnacle, and Air Tran.
March

– Attended Sixel Consulting A ir Service Conference , meetings with Frontier and SkyWest. April

– American Eagle terminate d SPI

- ORD route and add ed SPI

- DFW route.
June

– Attended J umpstart Conference , met with Southwest
, United, US Airways

, Allegiant Air, Republic and Vision Airlines.
J une

– Direct Air beg a n three times weekly year around service to Lakeland, FloridaS pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 17

October

– Met with Direct Air principals in Myrtle Beach, SC. Discussions about market opportunities to Nassau, Bahamas and Gulfport, MS

. November

- A ttended Sixel Consult ing A ir Service Conference , met with Frontier and US Airways.
December

– Updated presentations prepared and provided to Allegiant Air and Spirit Airlines
December

– Community Air Service Survey conducted

2012:
March

– U pdate d presentation sent to Alleg iant suggesting service to Las Vegas, Phoenix/Mesa, Tampa/St Petersburg and Sanford/Orlando
March

– Attended Network USA , met with Allegiant

, Spirit, US Airways, United, and PeoplExpress.
March

– Direct Air abruptly terminated all service to all markets

, Airport scrambled to find short term replacement service from Vision Airlines

. April

– A ttended Sixel Consulting Group Air Service C onference , met with US Airways, American Eagle, and SkyWest Airlines. May

– Vision Airlines operated summer service t o Myrt le Beach
, SC
, abandoned by Direct Air
June

– Attended ACI Jumpstart Air Service Conference , met with United, US Airways

, Allegiant

, PeoplExpress, Spirit and Sun Country.

2013 : February

– Attend ed Allegiant Air conference in Phoenix. April

– Attended Six el Consulting Group Air Service Conference in Tu cson , met with SkyWest ( U nited Express), American, and US Airways

. August

– Completed a True Market Study, updating previous similar studies in 2011 and 2009. September

– Attended Sixel Consulting Group Air S ervice Conference in Albany, met with American and US Airways.

So far in 2014 the Airport has attended the Sixel Spring conference

, the Allegiant Conference
and will attend Routes in Chicago in September and Sixel Fall Conference in November

.

Springfield’s annual air service marketing budget is significant and
reflects the importance that the Airport Authority attaches to continually marketing itself.S pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 18

PREVIOUS GRANT AWARDS

The Springfield Airport Authority has been awarded and has succes sfully used three previous SCASD Grants. The first two of those Grants were for Minimum Revenue Guarantee (MRG) funding for the specific purpose of recruiting a new air service or air service carrier to a specific destination or for a specific purpose. The third Grant award was for an innovative Ground handling cost

- offset program aimed somewhat narrowly at recruiting Allegiant Air less

- than

- daily leisure destination service. None of the three previous grants is similar to this Grant proposal for a
well

- def ined Community Engagement Program.

The first Grant (awarded 9/5/2006) had project goals and objectives as follows: Increase enplanements, strengthen existing carriers at the airport, begin nonstop service to Washington D.C. and open up the Airport to new one

- stop domestic and international routes. The Grant was in the amount of $390,000 and was matched by $975,000 in local cash and $100,000 in local in

kind contributions. Springfield successfully recruited United Airlines to begin regional jet service to
W ashington Dulles. The service operated from April of 2007 to early July of 2008. Unfortunately, during this time fuel prices soared. Also, the United Airlines regional partner assigned to operate the flights had reliability and on

- time performance issues. The Grant was closed on 6/13/2008.

The second Grant (awarded 9/19/2008) had project goals and objectives as follows: Provide

c entral Illinois and its Capital City a third option to a major airline hub offering connections to top destinations, increase awa reness about local air service and to increase availability of seats and provide more competitive airfares. The Grant was in the amount of $750,000 and was matched by $100,000 in local cash and $375,000 of in

- kind contributions. The primary target carrier/ route combination for the MRG funding of the Grant was Northwest Airlines and service to Memphis. Northwest merged with Delta Air Lines in late 2008 and did not have interest in the market and route concept. Springfield network service was reduced in 2009 to American Eagle and United Express both offering flights to Chicago ORD. In late 2010, Springfield and American Eagle proposed to the DOT that this Grant’s funding be put toward supporting American Eagle service from SPI to DFW. With DOT approval of that proposal, that service began in April of 2011 and continues today. This Grant was closed on 4/17/2012.

The innovative third Grant award (September, 2012) was for ground handling and marketing
cost

- offsets for the recruitment of Allegiant Air service to S pringfield. Within weeks of Grant award Allegiant announced Grant supported service to Punta Gorda, which began inS pringfield Airport Authority • Small Community Air Service Development Grant Proposal • July 2014 

## 19

November of 2012. Since the Grant award Allegiant has not only retained the Punta Gorda
route but also added service to Orlando Sanford. This Grant was closed in July of 2014.

None of the first three Grants have the focus or purpose of this Grant proposal. The only
common t h read in the three Grants and this Grant proposal is the aspect of air service marketing. However, basically every SCASD Grant, with rare exceptions perhaps involving a study, involve some element of marketing, be they MRG, EAS marketing, ground handling

, etc.

Springfield has won three previous Grants because Springfield made, each time, a compelling

case for Grant funding. This Grant application also has a compelling case, but it has no MRG, no targeting of a specific carrier and no ground handling or other carrier cost off

- sets. Thus it is a different Grant application and not subject to a “same purpose” consideration.



## CONCLUSION
The Springfield Airport Authority and its many community partners have been dealt, again and again, a tough hand in the area of air service. The St. Louis hub closure devastated our local air service, yet we preserved and gained regional j ets to Dallas. We pioneered Direct Air less

- than

daily leisure service in c entral Illinois, when that carrier failed due to mismanagement, we not only recruited Allegiant Air to replace them, but have helped that carrier grow service well beyond any level that Direct Air offered us.

Now we face a measurable and continuing and alarming decline in our network carrier service.
And network air service is essential to the well

- being of the Springfield community and economy. This Grant application has demonstra ted Springfield’s clear air service deficiencies and how we will address those deficiencies;
 Market fares well above the national average and well above those at primary leakage point St. Louis.
 Continuing declines in network carrier seat capacity and flig ht frequency.
 A detailed Community Engagement Program designed to reverse the documented market leakage we have, which will improve our traffic and cause re

- instatement of capacity reductions. This is essential in supporting our growing population and economy.
 The community has a powerful public private partnership for air service, as is demonstrated by our successful administration of three previous Grants.
 We will be able to use the Grant is a timely manner.