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OST-97-2942

Seward, Alaska (EAS)

Order 97-9-34 | OST-97-2942 | Issued September 26, 1997 | Served October 2, 1997

Order Tentatively Reselecting Carrier

By this order we are tentatively reselecting F. S. Air Service, Inc. to provide subsidized essential air service at Seward, Alaska, for the two-year period beginning October 1, 1997, through September 30, 1999, at an annual subsidy rate of $77,918.

By: Charles Hunnicutt

Essential Air Service at Seward, Alaska

OST-97-2942 | November 17, 1997

Proposal of F.S. Air Service

FS Air owns a hangar and an office at the Seward Airport, where we also sell aviation fuels.

Appendix B - Annual Subsidy Need at Seward, Alaska Docket 42501

Amended Proposal of F.S. Air Service

FS Air Service has been in existence since 1976 ant has been flying to Seward, Alaska since 1994. Flying to Seward, Alaska is part of this company's identity. So much so, that in 1996 we purchased the largest lot, with the only permanent structures, available at the Seward airport, in Seward, Alaska. These structures include a 7000 square foot hangar, filling station, and a 2000 square foot office, with the largest "passenger terminal" area available at the Seward Airport.

Revised Appendix B - Annual Subsidy Need at Seward, Alaska Docket 42501

By: John Seaman, F.S. Air Service, 907.248.9595

Proposal of ERA Aviation

Era Aviation believes strongly that it should be selected to provide essential air service to Seward, Alaska at an annual subsidy rate of $76,894. As opposed to the current service provider, Era will provide the flights to Seward in a reliable twin-engine, turbo-prop aircraft flown by a crew of two pilots. This service will depart and arrive at the airline terminal building in Anchorage, as opposed to a remotely located hangar facility. The service will be conducted under FAR Part 121, as opposed to Part 135. The flights will take advantage of modern instrument approach technology at the Seward Airport that no other carriers are authorized to utilize. This will afford customers a level of safe, all-weather access to Seward unattainable by other carriers.

Appendix A - Era Aviation, Inc. | Appendix B - 5 Year Accident History

By: Joe Sprague, Era Aviation, 907.248.4422

Seward, Alaska (EAS)

OST-97-2942 | November 18, 1997

Reply Comment of ERA Aviation

FS Air makes a commendable statement that they are committed to passenger safety, but then go on to suggest in a vague statement that they have an unblemished safety record ("No accidents, fatalities or injuries-). We suggest that DOT evaluate FS Air's accident and FAA compliance history over the past five years. While we found other questionable items in FS Air Service's counter proposal, the statements on their use of 19 seat aircraft, their safety record, and their assessment of the Seward GPS approach are in various instances vague, inaccurate and misleading. Additionally, the Modest growth prediction" contained in their updated subsidy request seems questionable, and we encourage DOT to compare previous year's passenger totals for FS to determine the accuracy of this prediction.

By: Joe Sprague, 907-248-4422

Essential Air Service at Seward, AK

Order 98-1-2 | OST-97-2942 | Issued January 2, 1998 | Served January 7, 1998

Order Selecting Carrier

By this order we are finalizing our tentative decision in Order 97-9-34, to reselect F. S. Air Service, Inc. to provide subsidized essential air service at Seward, Alaska. In addition, by this order we will establish a revised annual subsidy rate in the amount of $73,498 for the two-year period beginning with the service date of this order.

By: Charles Hunnicutt

Seward, AK

By this order we are tentatively reselecting F. S. Air Service, Inc. to provide subsidized essential air service at Seward, Alaska, for the two-year period beginning January 1, 2000, through December 31, 2001, at an annual subsidy rate of $82,878. F. S. Air Service, Inc. was last selected to provide essential air service at Seward, Alaska, pursuant to Order 98-1-2, issued January 2, 1998. The annual subsidy rate of $73,498 established by that order will expire December 31, 1999.

By:  Bradley Mims

Essential Air Service at Seward, Alaska

Per your telephone with General_.Manager, Hob Cannon, effective 90 days from this date F. S. Air Service, Inc, will cease scheduled service between Anchorage and Seward, Alaska. , Mr. Cannon will provide DOT with the statistics in the near future. The_. BAS supplemental income to this route has become less and less sufficient over the years. The escalating insurance premiums, fuel, employee packages and lack of passenger travel are a factor in our decision to discontinue service. It was a pleasure working with you and we are hopeful of working with you in the future.

By:  F.S. Air Service, Sandra Butler

Essential Air Service at Seward, Alaska

2002-3-30 is prohibiting F.S. Air Service, Inc., from terminating its subsidized service at Seward, Alaska (b) requiring the carrier to maintain service between the community and Anchorage for an initial 30-day period following the end of the notice period; and (c) requesting proposals from carriers interested in providing replacement service at the community. Proposals due April 23, 2002.

By: Read Van de Water

Essential Air Service at Seward, Alaska

We understand the air carrier providing Essential Air Service (EAS) to Seward, Alaska has requested release from their obligations. We concur that there is not sufficient passenger traffic to justify continued EAS subsidy for air service to Seward at this time. Seward is a community of approximately 5,000 people. Primary access between the air service hub at Anchorage and Seward is by road, approximately 120 miles, Based on traffic loads for the air carrier providing service, residents appear to favor driving to Anchorage when they need to connect to air travel, rather than using the EAS provider. There is also a rail connection between Anchorage and Seward that operates during the summer season. Tourists arriving in Seward by cruise ship generally take the train or travel the highway connection on busses to Anchorage. Should a market for air service in Seward develop in the future that could be assisted by an EAS subsidy, we would certainly support that. However, at this point, we concur with the air carrier that there is currently not sufficient traffic to continue providing EAS service to Seward.

With the opening of the rivers for barge traffic, most bush markets will be resupplying their fuel tank farms. Those prices have not been published yet; but, the spot market is rapidly rising at this time of year and will be passed on to the carriers who require fuel from bush hub locations. These costs cannot be calculated at this time and must be considered for future rates.

By:  State of Alaska, Paul Bowers

Essential Air Service at Seward, Alaska

By this order, the Department is terminating the subsidy eligibility of Seward, Alaska. We are also setting new final subsidy rates for FS Air Service for the period October 1, 2001, through December 31, 2001, and from January 1, 2002, until 60 days after the service date of this order, or when FS Air Service terminates its service to Seward, whichever comes first

We appreciate the important role that the State plays in EAS matters within Alaska. It has always taken a very practical view of the EAS needs in Alaska, as it has again done here. Based on the State's letter, we will not continue subsidy support for Seward's air service under the EAS program at this time. While Seward generated more passenger traffic than most other subsidized communities in Alaska, the critical difference is that those other communities, while much smaller than Seward, have no alternative means of accessing the national air transportation system. Also, traffic at Seward has declined somewhat recently, which would tend to drive up the subsidy cost of maintaining air service. Given the State's position in this case, it would not be appropriate to continue subsidizing air service to Seward. Therefore, we will end subsidy payments for service at Seward and will for now terminate the subsidy eligibility of Seward. In order to allow for an orderly shutdown of service, we will continue to subsidize FS Air Service for its service to Seward for up to 60 days from the service date of this order.

By:  Read Van de Water

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