OST Docket Filings for March 9, 2006

Annual compensation requirement for the period May 1, 2006 forward is estimated at $5,1551,700.00. Alaska has based this requirement on its need calculated for the twelve months ended September 2005.

First, there is a $45,218 difference in Alaska's General and Administrative expense between the amounts reflected under Alaska's (a) subdivided proposals for Cordova, Yakutat and Gustavus, on the one hand, and for Petersburg and Wrangell, on the other, for which the total G&A expense is $1,336,059 and (b) Alaska's initially submitted aggregated proposal in which the total G&A expense appears on the summary P&L page as $1,290,843. The G&A understatement Alaska made in its initial proposal was entirely the result of an incorrect transposition of the correct G&A expense number shown in Exh. AS-5, p. 9, to the summary P&L appearing on AS-2, p. 1. The transposition was discovered when the subdivided proposals were prepared and the G&A expense for the proposals totaled the same $1,336,059 amount reflected in Alaska's original AS-5, but which was incorrectly carried forward to the summary P&L for Alaska's original aggregated proposal. The correct G&A figure is $1,336.059.

Second, Alaska's initial proposal requesting $5.207 million (as corrected for the G&A transposition error discussed above) was based on Alaska's actual 97% schedule completion factor and actual costs for the 12 months ended September 30, 2005. In submitting that proposal, Alaska assumed that the Department would, as it has consistently done for decades including most recently in 2004, adjust the final EAS compensation number to reflect Alaska's most recently experienced completion factor of 97 percent. To do otherwise would not only represent a sharp departure from years of precedent, but it would unfairly penalize Alaska by treating its implicit 97% completion factor proposal as the equivalent of an operationally unattainable 100% completion. That would force Alaska to unjustifiably accept a more than $150,000 reduction in its new EAS rate proposal - which already reflects a $520,000 reduction from Alaska’s current EAS rate. Parenthetically, it is also worth noting that Alaska’s current rate was predicated on an even lower completion factor of just 96%.

The purpose of this letter is to encourage the Office of Aviation to renew the flight contract for Essential Air Service with Scenic Airlines.

I am concerned that Mesa Airlines, if selected as the essential air service carrier for Ely, Nevada will reduce or discontinue services to and from Reno or Las Vegas.

I am writing to object to your Department’s recent decision to terminate the Essential Air Service subsidy eligibility for McKellar-Sipes Regional Airport in Jackson, Tennessee. The claim that Jackson’s passenger levels continue on a downward trend is I not supported by careful analysis of the 2005 figures. And most importantly, focused analysis proves that the per-passenger subsidy has fallen back below the $200 cap since. the Department of Transportation notified the Jackson-Madison County Airport Authority in July that it was exceeding its limit.

This letter is in regards to your letter to the City of Port Alexander dated February 1 , 2006, requesting comments on the options proposed for our Essential Air Service provided by Harris Aircraft Services in Sitka, Alaska.

The City of Port Alexander would like to recommend that the Assistant Secretary select Option 3: two nonstop round trips a week September through May, and five nonstop round trips a week June through August, at an annual subsidy rate of $70,970.00.

OST-1998-3726 - Exemption - Addis Ababa, Ethiopia-Washington, D.C.
OST-1998-4345 - Exemption - Addis Ababa, Rome-Newark and Washington, DC

Ethiopian hereby applies for renewal of the exemption authority last granted by Department Notice of Action Taken dated March 10,2005. The above-referenced NOAT renewed authority for Ethiopian to engage in foreign air transportation of persons, property and mail between Addis Ababa, Ethiopia and the coterminal points Newark, New Jersey and/or JFK, New York, and Washington, DC via Rome, Italy (without U.S.-Rome traffic rights).

On March 10, 2005, Ethiopian was granted a one-year renewal of its exemption authority to provide scheduled combination service between Addis Ababa, Ethiopia and New York (Newark Liberty International Airport and/or JFK Airport) and Washington, DC via Rome, Italy. That authority is set to expire March 10, 2006.

Ethiopian has also applied for issuance of an initial foreign air carrier permit in Docket OST-1998-3727. That application was filed April 9,1998, and has been pending for almost eight years. On May 17, 2005, however, the United States and Ethiopia concluded an Open Skies Agreement, which now governs aviation relations between the two countries and should lead to an early grant of Ethiopian's foreign air carrier permit application.

Ethiopian has continued to operate scheduled combination service over the routing Addis Ababa-Rome-Newark/New York-Washington, DC since the exemption authority was granted. Ethiopian currently operates three weekly round-trip flights over the Addis Ababa-Rome-Washington, D.C. routing with Boeing B-767-300 aircraft.

Excel hereby applies for renewal of its exemption authority to engage in charter foreign air transportation of persons, property and mail (1) between the United Kingdom and the United States, and (2) other charters in accordance with Part 21 2 of the Department’s regulations.

The authority for which renewal is requested was initially granted on November 16, 2001 and was most recently renewed on March 9, 2005. The authority is scheduled to terminate on March 9, 2006. Excel requests that it be renewed for an additional one-year period.

What FNSB identifies as an order of the Postal Service is a nine-page “Business Plan” for “Air to Surface Mode Conversion – Fairbanks to Barrow,” updated February 28, 2006, prepared by the Postal Service’s Western Area Distribution Networks office.

As the business plan reflects, non-priority mail (including both in-house non-priority mail and bypass mail), for Barrow, AK, is currently flown from Fairbanks to Barrow. The business plan contemplates the diversion of this mail from these flights to surface (truck) transportation, using an existing postal contractor, between Fairbanks and Deadhorse, AK. From Deadhorse, the non-priority mail would be flown by mainline carrier to Barrow.

The determination to transport mail from Fairbanks to Deadhorse by truck is not a matter within the scope of 49 USC § 41902. Such transport is not “transport [of] mail by aircraft”; rather, it is transportation of mail by contract pursuant to the separate authority at 39 USC § 5005(a)(4).

Since the business plan is not an order of the Postal Service under section 41902, there is nothing for FNSB to appeal pursuant to that section, nor, accordingly, is there anything for the Department to postpone pursuant to the current application.

The United States Postal Service respectfully moves that the subject application be denied and that the pending matter be dismissed for the Department’s lack of subject matter jurisdiction.

The Secretary should cancel all final provisions in the UBP and specifically cancel provisions in the updated business plan requiring air carriers to file final schedules 28 days in advance of the projected startup. The rule is that "if the public convenience and necessity require, the Secretary may amend, modify, suspend, or cancel the order. §41202(e).

Apparently, USPS's authority to exclude the mainline carriers from participating in an intra-Alaska non-bypass route is 49 USC §41902. Pursuant to that statute an air carrier may transport [nonbypass] mail by aircraft ... between places in Alaska only under a schedule designated or required to be established under subsection (c) of this section for the transportation of mail.

The efforts of USPS appear consistent with an intent to exploit every factual and legal ambiguity to the detriment of the public it is required to serve. Review of the UBP is appropriate here.

Under the status quo, the current bypass mail route between Barrow and Fairbanks is serviced using existing mainline carriers and functioning well. The UBP eviscerates or eliminates this established route. The updated plan calls for a non-bypass surface route from Fairbanks to Deadhorse and a non-bypass air route from Deadhorse to Barrow.

Accordingly, the UBP is illegal on its face. As a matter of law, the updated business plan must be struck down as being in violation of the public necessity and convenience.

The statement of authorization will remain in effect only as long as (i) Skywest and bmi continue to hold the necessary underlying authority to operate the code-share services at issue, and (ii) the code-share agreement providing for the code-share operations remains in effect.

The authority granted here is specifically conditioned so that neither Skywest nor bmi shall give any force or effect to any contractual provisions between themselves that are contrary to these conditions.

By this order, the Department is granting the request of Spirit Airlines, Inc. to amend the use of two of its lottery slot exemptions at Ronald Reagan Washington National Airport. To accommodate seasonal fluctuations in demand, Spirit may vary its use of a pair of its lottery slot exemptions for the purpose of providing nonstop service between either Detroit Metropolitan Airport or Fort Lauderdale/Hollywood International Airport and DCA. Spirit must also continue to use its remaining lottery slot exemptions to provide year-round, nonstop service between FLL and DCA.

As we noted previously in Order 2003-9-30, to qualify for a “slide” in slot operating times, the Department must find exceptional circumstances and that grant of the authority would not (1) result in an increase in the total number of slots per day at Reagan National; (2) result in an increase in the total number of slots at Reagan National between the hours of 0700 through 2159; (3) increase the number of operations at Reagan National in any one-hour period by more than two operations; (4) result in the withdrawal or reduction of slots operated by an air carrier; and (5) result in a net increase in noise impact on surrounding communities resulting from changes in timing of the exempted operations

Spirit’s amendment request satisfies the exceptional circumstances criteria contemplated by the Department in approving previous slot exemption requests. Spirit’s current service pattern at DCA, consisting of a total of three arrivals and three departures a day, is provided exclusively through the use of its slot exemptions and lottery slots. Spirit is among the smallest slotholders at DCA and is highly constrained in its ability to (internally) adjust the use of its slots in response to fluctuations in market demand.

OST-2005-22725 - Exemption and Statements of Authorization - Switzerland-US Codeshare with American Airlines and United Air Lines

Exemption from 49 U.S.C. § 41301 to transport persons, property and mail by displaying the airline designator codes of United Air Lines, Inc. and American Airlines, Inc. on flights operated by Swiss European on behalf of Swiss International Air Lines between points in Switzerland and between points in Switzerland and points in third countries.

Statement of authorization under 14 CFR Part 212 to the extent necessary for Swiss European to place the designator codes of United and American on flights that Swiss European operates on behalf of Swiss International Air Lines. Swiss European proposes to operate these operations between points in Switzerland and between points in Switzerland and points in third countries.

Swiss European states that Swiss is in the process of ending its code-sharing arrangement with American and commencing its arrangement with United, and that Swiss European proposes, for a finite period of time, to operate codeshare service with both carriers.

By Notice of Action Taken dated December 13, 2005, in this Docket we granted this application in part, to permit Swiss European to carry the code of American. We deferred action on Swiss European’s request (both as to exemption authority and a statement of authorization) to carry United’s code pending further advice from the FAA concerning United’s audit of the carrier under the DOT/FAA code-share Safety Program Guidelines. On March 3, 2006, we received the necessary FAA clearances to enable us to proceed with the deferred portion of this request.

Swiss European previously held out under the d/b/a Swiss Too, and several references in our earlier action reflect the previous d/b/a.

Arrow hereby opposes the application of TAMPA Cargo, S.A. for an exemption to engage in foreign scheduled air transportation of property and mail between Miami, Florida and Port Au Prince, Haiti without limitation or restriction. The application is without merit, fails to comply with regulations of the Department of Transportation, proposes service that would be harmful to the aviation interests of the United States and should be denied.

TAMPA has asked the Department for an exemption to allow it to engage in unlimited scheduled foreign air transportation carrying cargo and mail between the terminal points Miami, Florida and Port Au Prince, Haiti. The application does not present any factual information on which the Department can rely to support a finding that it should be granted. TAMPA has not described how it proposes to exercise the authority it has requested, the frequency of service, the capacity to be offered or the type of services for shippers that would be offered in the market.

The Miami-Port Au Prince air cargo market is not very large. Arrow currently operates a freighter aircraft between the points on Monday of each week in conjunction with Air Haiti. Between Arrow and Air Haiti the market is well served. The addition of an undetermined amount of capacity by an unrestricted foreign air carrier from a third country would not be beneficial for the markets but would be economically destructive. In this connection, it should be noted that Part 292 of the Department's regulations exempts direct air carriers from tariff filing requirements in international all-cargo markets and a rate war would result driven by overcapacity in the market. Both Arrow and Air Haiti would be damaged by the entry of the foreign carrier TAMPA into this market.

TAMPA claims, again without any supporting economic data, that the proposed service Haiti service will strengthen its ongoing Colombia-Miami operations. There is no evidence or even a description of how the proposed service will connect with or support the existing TAMPA operations between the U.S. and Colombia. Arrow strongly challenges the TAMPA assertions on the basis of record before the Department and underscores that TAMPA has not provided any factual support for its proposal. There is no need demonstrated. There is no bilateral agreement to support the award and no demonstration of comity and reciprocity on which to base approval of the TAMPA request.

On February 21, 2006, Tampa Cargo, S.A. filed the above-referenced application for an exemption to provide a Miami-Port Au Prince, Haiti-Miami all cargo scheduled service. Subsequent to the filing of the application, Tampa became concerned about the security associated with the operation of these flights, determined that it would not operate the flights and so informed its customer. Consequently, Tampa hereby withdraws its application herein.

In the context of conducting a telephone poll for this exemption application, comments were made by certain carrier representatives concerning the seventh freedom nature of these flights. As the Department is well aware, Tampa strongly supports the adoption of an Open Skies Agreement for cargo services between the United States and Columbia, and has been an active participant in the efforts to develop and adopt such a regime between the two countries.

Recently, Tampa has become aware that the U.S. Government may be more interested in developing an open skies regime for passenger services rather than cargo services. Tampa was disappointed to learn of this development and strongly urges the U.S. Government to continue to move towards an open skies regime for cargo at the earliest possible opportunity.

On March 3, 2006, United was notified that it had been awarded contracts for international air transportation of mail for Segments 01 (ORD-NRT), 10 (SFO-LHR), 11 (ORD-LHR), 13 (JFK-LHR), 14 (SFO-FRA), 15 (LAX-FRA), 16 (ORD-FRA), 17 (JEC-FRA), 20 (ORD-CDG), 21 (ORD-AMS), 22 (JEC-AMS), 29 (JEC-ICN), and 30 (SFO-ICN) under U.S. Postal Service Solicitation No. 5AAIMT-06-A-0017. The terms of the contract offer and award - Contract No. IAT-06 -- are reflected in Postal Service Forms 8203, which have been submitted under seal for review to the Department's Office of Aviation Analysis. The contract contains proprietary and commercially sensitive information that United submitted on a confidential basis to the U.S. Postal Service when it participated in a competitive procurement for the Segments in IAT-06 award. The disclosure of this confidential and highly sensitive commercial information could adversely affect United's competitive position in bidding for and transporting international mail

OST-2005-23307 - Certificate of Public Convenience and Necessity - Interstate Scheduled Passenger

Exemption from 49 USC § 40109(g) to permit the applicant to operate four, one-way, all-cargo charter flights, using its AN-124-100 aircraft, carrying outsized cargo on behalf of the U.S. Department of Defense, from Fort Drum, New York, to Victorville, California, during the period March 13 through March 17, 2006. The applicant states that the flights would carry nine OH-58D helicopters and associated equipment. The applicant asserts that DOD needs the subject lift to meet highly time-sensitive training and operational mission schedules; that the DOD organic lift scheduled to transport the cargo was diverted to other areas; that the cargo is too large for transportation on U.S.-carrier aircraft; and that surface transportation is not feasible because of the delicate nature of the cargo and urgency of the shipment.

We are granting Volga-Dnepr’s request to operate the four proposed one-way flights on behalf of DOD. We found that its request met all the relevant criteria of 49 USC § 40109(g) for the grant of an exemption of this type, and that the grant was required in the public interest. Specifically, we were persuaded that the need to move the cargo to meet highly time-sensitive training and operational mission schedules; the fact that the DOD organic lift scheduled to transport the cargo was diverted to other areas; and the unique, outsized nature of the cargo, constituted an emergency not arising in the normal course of business. Moreover, based on the representations of the U.S. carriers, we concluded that no U.S. carrier had aircraft available that could be used to conduct the operations at issue here.

WestJet hereby applies for renewal of its exemption from 49 USC 41301 authorizing it to provide charter and scheduled foreign air transportation of persons, property and mail between a point or points in Canada and a point or points in the United States.

WestJet asks that this exemption be renewed for a two-year period or until grant of the relief requested in WestJet’s pending application for transfer of a foreign air carrier permit in Docket OST-2001-11156.

Authority was most recently renewed on March 11, 2005 and is effective through March 11, 2006.