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Essential Air Service at Adak, Alaska

We have decided to select Alaska Airlines. The proposals of Jetstream and Evergreen lack community support and require similar or more subsidy than the other applicants, and so can be readily rejected. However, the decision between Peninsula and Alaska Airlines requires us to consider conflicting carrier-selection criteria: Peninsula requires significantly less subsidy than Alaska Airlines, ranging from $749,095 to $1,247,547 less, depending on which option were selected. On the other hand, Alaska Airlines is strongly favored by the community. In non­Alaska communities, the Department would nearly always select the lower-cost alternative when the subsidy differences are this great. Also, two of Peninsula's options would provide service with cabin-class Saab 340 aircraft, equipment larger than most subsidized communities receive, and all of Peninsula's options would provide more frequent service than Alaska Airlines contemplates.

Given the very substantial level of subsidy required to support this service, if traffic does not respond or the level of subsidy support needed does not decline, we will review the issue towards the end of the one-year contract period.

By: Read Van de Water

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