Essential Air Service at Merced and Visalia, California and Ely, Nevada

Order 2006-6-10
OST-1998-3521 - Merced, CA
OST-2004-19916 - Visalia, CA
OST-1995-361 - Ely, NV

Issued June 8, 2006 | Served June 13, 2006

Order Prohibiting Termination of Service and Requesting Proposals - Bookmarked

By this order, the Department is (a) prohibiting Scenic Airlines from terminating its subsidized service at Merced and Visalia, California, and Ely, Nevada. at the end of its 90-day notice period, and (b) requesting proposals from carriers interested in providing essential air service at the communities, with or without subsidy.

Because Scenic's termination of service at Merced, Visalia, and Ely would leave the communities without any scheduled air service, we must prohibit the carrier from terminating such service at the end of its 90-say notice period, and require it to maintain service at the communities, for an initial 30-day period, consisting of 14 round trips per week from Merced to North Las Vegas; 10 nonstop round trips per week from Visalia to North Las Vegas; and 6 nonstop round trips a week from Ely to both North Las Vegas and Elko. Furthermore, we will require Scenic to maintain service at all three communities for successive 30-day periods until we have completed processing the carrier replacement case and the new carrier has actually started service.

With specific respect to Merced and Visalia, we expect proposals consisting of service with 15-scat or larger aircraft offering two nonstop round trips each weekday (12 to 14 weekly round trips) to San Francisco. Los Angeles, Las Vegas McCarran, or another suitable huh. For Visalia, based on the latest traffic data, subsidy levels cannot exceed $896,200 per year because of the S200 subsidy per passenger cap. The Department is prohibited from paying subsidy for essential air service at any community in the 48 contiguous states where such subsidy amounts to more than $200 per passenger, unless that community is located more than 210 miles from the nearest large- or medium-hub airport. Visalia is located less than 210 miles from several large- and medium-huh airports (Los Angeles, 187 miles; San Jose, 95 miles; and Burbank, 171 miles), so the $200 cap will apply.

At Ely, we expect proposals consisting of service with 15-seat or larger aircraft offering one nonstop round trip each weekday and weekend to Reno, Salt Lake City, Las Vegas McCarran, or other suitable hub. If aircraft smaller than 15-seat aircraft are proposed, a minimum of two round trip flights to a suitable huh should he offered. Such service is generally consistent with what the communities currently receive. We encourage proposals that meet those requirements in an efficient manner. Carriers are also welcome to propose more than one service option, if they choose; they need not limit themselves to those requirements if they envision other, potentially more attractive service possibilities -- different hubs, for example -- with subsidy requirements that remain competitive.

By: Michael Reynolds