Order 2012

- 11

- 19

Served: November 16, 2012



### UNITED STATES OF AMERICA

DEPARTMENT OF TRANSPORTATION

OFFICE OF THE SECRETARY WASHINGTON, D.C.

Issued by the Department of Transportation

on the 16 th day of November, 20 1 2

ORDER APPROVING ALTERNATE SERVICE PATTERN

Summary By this O rder, the Department of Transportation is approving the request of Great Lakes Aviation, Ltd. (“Great Lakes”) to change the hub destination of Silver City /Hurley/Deming, New Mexico (“Silver City”) from Albuquerque International Sunport Airport (“Albuquerque”) to include Phoenix Sky Harbor International Airport (“Phoenix”) effective October 1, 2012

.

Background

B y Order 2011

- 4

- 19

, issued on April 22, 2011 , the Dep artment re

- selected Great Lakes to provide subsidized Essential Air Service (“ EAS ”) at Silver City through May 31, 2013

. That O rder directed Great Lakes to provide the community with 12 nonstop round trips

per w eek to Albuquerque , using 19

- seat Beech 1900 aircraft

, at an annual subsidy of $ 1, 594,092

. 1

Great Lakes has requested to alter the current hub from Albuquerque to Phoenix. Silver City would continue to receive the same frequency of service with 19

- seat Beechcraft aircraft with no change in annual subsidy.

1 On June 4, 2012, Great Lakes filed a 90

- day notice of its intent to suspend service, and we are processing a carrier

- selection case. Essential Air Service at :

SILVER CITY/HURLEY/DEMING, NEW MEXICO

Under 49 U.S.C. 41731 et seq

. Docket DOT

- OST

- 1996

- 1903- 2

-

Community Comments In the context of the ongoing carrier

- selection case, b y e

- mails dated August 17, 2012

, the Department solicited the views of the civic officials at Silver City and the New Mexico Department of Transportation (NM DOT) , as to which air carrier ’ s proposals they would prefer for the new two

- year EAS contract

. Silver City support s the re

selection of Great Lakes. The Grant County Manager stated “the County Commission

would like to have the Essential Air Service continue with Great Lakes Airlines with two round trip service a day to Phoenix .” 2 The Mayor of Silver City also sent a letter supporting the retention of Great Lakes and its proposed service to Phoenix

.

Decision We will approve Great Lake s’ request during the pendency of the carrier

- selection case.

It meets the three conditions necessary for approval under authority assigned under 14 CFR Part 385.12(k)(3) of the Department’s Regulations: (1) the alternate service pattern is equal or greater than that determined to be essential; (2) the community does not object

to the alternate s ervice pattern; and (3) the alternate service pattern will not increase Great Lakes’ subsidy.

Because we are allowing the alternate service pattern and not requiring it, Great Lakes may revert to the original service pattern at any time, subject to reasonable notification of the community.

This O rder is issued under authority assigned in 14 CFR Part 385.12(k)( 3 ).

ACCORDINGLY,

1. We hereby approve the alternate ser vice pattern requested by Great Lakes Aviation, Ltd., to serve Silver City /Hurley/Deming , New Mexico, from Phoenix, Arizona;

2. These Docket s will remain open until further O rder of the Department; and

3

. The Department will serve a copy of this O rder on the civic officials of Silver City, New Mexico, and Great Lakes Aviation, Ltd.

2 Silver City is located in Grant County. Grant County owns the airport where EAS is provided.- 3

-

Persons entitled to petition the Department for review of this O rder under the Department’s Aviation Economic Regulations, 14 CFR Part 385.50, must file such petitions within ten (10) days aft er the date of service of this O rder.

This O rder 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

on the World Wide Web at http://www.regulations.govAppendix A

Great Lakes Aviation, Ltd.

Provision of Essential Air Service at Silver City/Hurley/Deming, New Mexico Summary of Service To Be Provided

Effective Period : Beginning October 1, 2012, until further notice by the Department

Scheduled Service : 12 round trips a week to Albuquerque or Phoenix Aircraft type: Beechcraft B

- 1900D (19 passenger seats) Intermediate stops and upline service : No service to any other intermediate point is contemplated under the

terms of the carrier’s proposal; accordingly, no such service may be provided on subsidized flights without prior Department approval. Timing of flights: Flights must be well

- timed and well

- spaced in order to ensure full compensation. Annual compensation : $1,594,092 This rate assumes an annual completion factor of 98 percent. A compensation ceiling is to be applies per calendar week such that service above that ceiling in one week cannot make up for service

shortfalls in another week. Subsidy Rate per Flight: $1,29 9 1

Weekley Compensation Ceiling: $31,176 2

1 Annual subsidy of $1,594,092 divided by 1,227 annual departures: 2 arrivals and 2 departures each week day and each weekend (24 flights/week) x 52 weeks x .98 (completion factor) = 1,227 + 4 additiona l flights.

2 24 flights per week multiplied by $1,229 per flight.Appendix B

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

it s 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 these rates, 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 disa llowed, 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 complete ly , termina tes 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 leve ls, 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

c arrier do not constitute a total or partial reduction or cessation of payment.

Subsidy contracts are subject to, and incorporate by reference, relevant statutes and Department regulations, as they may be amended from time to time. However, any such statu tes, regulations, or amendments thereto shall not operate to controvert the foregoing paragraph.

Funds are not currently available for performance under this order beyond March 31, 2013 . The Department’s obligation for performance unde r this order beyond March 31, 2013 , 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 March 31, 2013 , until fun ds are made available to the Department for performance. If funds are not made available for performance beyond March 31, 2013 , the Department will provide notice in writing to the carrier.

All claims for payment must be submitted within 60 days of the l ast day of se rvice provided

under this order.