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OST-97-3086

Colgan Air, Inc. (Exemption, High Density Rule, New York LaGuardia)

OST-97-3086 | November 4, 1997

Application for an Exemption

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Requests 16 commuter slots at LaGuardia to provide eight LaGuardia round-trip flights. Colgan has been unable to obtain permanent slots under the existing rules. For a carrier such as Colgan, options are limited. Its service from LaGuardia to Hyannis, Nantucket and Charlottesville is an essential part of its system. Colgan began service to Hyannis in 1992, to Nantucket in 1993 and to Charlottesville in 1995 -- operating three roundtrips to each market on each weekday. As can be seen by the passenger traffic numbers (Exhibit 2), those loads have grown every year and are expected to continue to grow. Colgan does not have the option of shifting operations elsewhere in the country or to other Northeast markets. Without its high density airport routes, Colgan would be placed in a significant competitive disadvantage -threatening its future economic health and would lessen its ability to serve other markets as well.

• Exhibit 1: Commuter Slots
• Exhibit 2: Passenger Traffic Numbers

Answers are due by November 21, 1997

Service List

Counsel: Ungaretti Harris, Edward Faberman, 202-778-4462

Colgan Air, Inc. (Exemption, High Density Rule, New York LaGuardia)

OST-97-3086 | November 20, 1997

Re: Comments of Charlottesville-Albermarle Airport

The New York Metropolitan Area is the top origin and destination market for this region. According to U.S. Department of Transportation Statistics, a total of 18,000 origin and destination movements occurred in this market in 1996, representing a six percent increase over the same period for 1995. Indeed, the service afforded by Colgan Air has been a significant reason for growth in this market. The success of this carrier and demand for its service is further evidenced by the fact that in October of 1997 it reported a 10.4% increase in passenger activity over the same period in 1996.

By: Charlottesville-Albemarle Airport, Bryan Elliott

Colgan Air, Inc. (Exemption, High Density Rule, New York LaGuardia)

OST-97-3086 | December 10, 1997

Letter from County of Albermale, Charlottesville, VA, in Support

Colgan Air, Inc. (High Density Rule - New York LaGuardia)

OST-97-3086 | December 31, 1997

Motion of The Department of Aviation, Commonwealth of Virginia and Colgan Air to File a Late Answer

Joint Answer of The Department of Aviation, Commonwealth of Virginia and of Colgan Air to the Answer of The Office of The Queens Borough President

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As Colgan stated in its application, it is forced to request an exemption for commuter slots because although Colgan leases slots, it has been unable to obtain permanent slots under the existing rules. A large majority of the commuter air carrier slots at LaGuardia are controlled by the major carriers or their large regional affiliates, while approximately 98% of the air carrier slots are controlled by the major carriers. Slots are not available for sale and would not be sold at prices that would allow Colgan to serve current markets. Colgan has not been able to purchase commuter slots. As a number of carriers have stated on the record in other slot petition requests, they cannot obtain air carrier slots. If large carriers are unable to purchase slots, Colgan would have no opportunity to obtain any.

Counsel: Ungaretti Harris, Edward Faberman, 202-778-4462

Applications of ACCESSAIR HOLDINGS, INC. / AMERICAN TRANS AIR, INC. / AMERICA WEST AIRLINES, INC. / COLGAN AIR, INC. / SPIRIT AIRLINES, INC. / PAN AMERICAN WORLD AIRWAYS, INC. and CARNIVAL AIRLINES, INC. / THE PEOPLE AND BUSINESSES OF BLOOMINGTON-NORMAL, IL; MOLINE-QUAD CITIES, IL; TOLEDO, OH; AND AKRON/CANTON, OH

ORDER GRANTING AND DENYING APPLICATIONS FOR SLOT EXEMPTIONS AT NEW YORK'S LAGUARDIA AND JOHN F. KENNEDY INTERNATIONAL AIRPORTS

After considering applications for exemptions from 14 CFR Part 93, Subparts K and S, for slots at New York's LaGuardia and John F. Kennedy (JFK) Airports, the Department has decided to grant five slot exemptions to American Trans Air, Inc. (ATA) for nonstop service in the Chicago (Midway)-LaGuardia market; and four slot exemptions to Spirit Airlines, Inc. (Spirit) for nonstop service in the Melbourne, Florida-LaGuardia market. We find that granting these exemptions is in the public interest and meets the statutory "exceptional circumstances" test. Grant of these exemptions is conditioned on their being used solely for nonstop service in the city-pair markets designated in the carriers' applications. The Department has also decided to deny the remainder of ATA’s and Spirit's applications as well as the applications of AccessAir Holdings, Inc., America West Airlines, Inc., Colgan Air, Inc., and the joint application of Pan American World Airways, Inc. and Carnival Air Lines, Inc. Further, we deny the petition for reconsideration of AirTran Airways' application filed by the People and Businesses of Bloomington-Normal, IL; Moline-Quad Cities, IL; Toledo, OH; and Akron-Canton, OH. In reaching our decision on all of these requests we were committed, among other guidelines, to avoiding significant congestion and environmental problems. Primarily for these reasons, we are granting only a limited number of exemptions.

By: Charles Hunnicutt

Colgan Air, Inc.

OST-97-3086	January 15, 1999	Application for an Exemption	High Density Rule - New York LaGuardia Airport	HTML
		Exhibit 1:  Requested Slots
		Service List

Colgan is forced to request an exemption for commuter slots because, although Colgan leases slots, Colgan has been unable to obtain permanent slots under the existing rules. A large majority of the commuter slots at LaGuardia are controlled by a few large carriers and their affiliates, while approximately 99% of the air carrier slots are controlled by the large carriers. Over the years, those large carriers have increased their slot holdings, making it more difficult for small, independent carriers to obtain slots. Slots are generally not available. The total number of LaGuardia slots are now controlled by the smallest number of carriers since the slot rules were first promulgated. Those that are available are either available for short-term leases or at prices that neither Colgan nor any other independent commuter operator could afford. Those a\,allable for lease are only available for short-term leases. As a number of large carriers have stated on the record before the Department, air carrier slots are not for sale. If large carriers are unable to purchase slots, Colgan would have no opportunity to obtain any.  Colgan is currently exploring the viability of utilizing regional jets. Many industry experts acknowledge that a large number of turboprops currently in the system will be replaced by regional jets. The Department has acknowledged that the use of regional jets has been an important plus for small and medium communities. As regional carriers are adding these jets to their fleets to serve their primary markets, Colgan is blocked from that upgrade because it is unable to ensure permanent use of those aircraft at its most important market -- LaGuardia.

Counsel:  Colgan and Ungaretti Harris, Edward Faberman, 202-778-4460

Colgan Air, Inc.

OST-97-3086	February 3, 1999 Docketed February 4, 1999	Answer of The Office of The Queens Borough President, City of New York	High Density Rule - New York LaGuardia
		Attachment:   Answer of Queens Borough President to Eastwind Airlines, OST-99-4979, January 21, 1999

This application is a nearly verbatim reiteration of Colgan's November 1997 application which was denied by the Department. In rejecting Colgan's request for slots at that time, the Department noted that while there were transportation benefits to the proposed service, the granting of slot exemptions "would not fill voids, but would merely enable an expansion of incumbent carriers' existing operations, and do not promise a significant enhancement of price competition."' The Department further noted that there was no showing of a "material deficiency of service in any of the markets ...[nor any evidence of] substantial competitive price benefits that [Colgan was] not already in a position to offer." Colgan's proposed service would do little to enhance any of the factors Congress specified that the Department consider in evaluating what was in the public interest. These factors include maintaining safety; enhancing low-priced services; encouraging fair wages and working conditions; increasing competition; encouraging the use of secondary or satellite airports in major urban areas; preventing anticompetitive practices; avoiding market domination by a single carrier; and providing low prices.

Counsel:  Queens, Michael Rogovin, 718-286-2888

Colgan Air, Inc.

OST-97-3086

February 26, 1999

Answer of Colgan Air to Answer of Queens Borough President, City of New York

High Density Rule - LaGuardia Slots

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Colgan Air is asking for the slots necessary to maintain existing services to small communities that have had long-standing service to LaGuardia and have extensive ties to the New York area. While Colgan would like to be in a position to expand its operations to high density airports, its immediate concern is being able to continue service to Nantucket and Charlottesville. The Borough President evidently believes that small and medium communities do not deserve service to LaGuardia and, if residents of those communities want to travel to New York, they should do so in "non-slot controlled" hours or at other airports. Apparently LaGuardia is reserved for certain-sized markets and carriers. That was not the intention of the high density rule although, as a result of consolidation in the industry and the proliferation of large hubs, service to smaller markets is disappearing. As a result of that consolidation, the regional carrier s purchased by the large carriers have shifted operations to larger markets, leaving smaller cities with no service to LaGuardia or National.

Counsel:  Ungaretti & Harris, Edward Faberman, 202.639.7501

Establishment of Slot Exemptions Proceedings 

By:  Bradley Mims

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