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Payments For Essential Air Services

Program Descriptions

Program Number

20.901

Title

Payments For Essential Air Services

 

Federal Agency

OFFICE OF THE SECRETARY, DEPARTMENT OF TRANSPORTATION

 

Authorization

49 U.S.C. 41731 - 41742.

 

Status

Active

 

Objectives

To assure that air transportation is provided to eligible communities by subsidizing air carriers when necessary to provide service.

 

Types of Assistance

Direct Payments for Specified Use.

 

Uses and Use Restrictions

When necessary subsidy payments are made to air carriers providing air services at certain points. Subsidy is paid to cover the carrier's prospective operating loss, plus a profit element.

 

Eligibility Requirements

Applicant Eligibility

Air carrier must be found fit and be selected by the Department to perform the subsidized service.

Beneficiary Eligibility

Air carriers and eligible local communities.

Credentials/Documentation

Financial statements and detailed operating statistics.

 

Application and Award Process

Preapplication Coordination

None. This program is excluded from coverage under E.O. 12372.

Application Procedure

In accordance with 14 CFR, Part 271, and specific Department requests in docketed cases.

Award Procedure

Evaluation of applications according to factors established in 49 U.S.C. 41731, et seq., and any Department-established factors.

Deadlines

None.

Range of Approval/Disapproval Time

From 2 to 4 months.

Appeals

In accordance with 14 CFR, Part 302.14.

Renewals

 

Assistance Considerations

Formula and Matching Requirements

None.

Length and Time Phasing of Assistance

In accordance with Department evaluation and determination of demonstrated need.

 

Post Assistance Requirements

Reports

None.

Audits

Air carriers are subject to audits of financial and operational fitness, of major contested claims of compensation for continued service, and of monthly billings to the Department for subsidy.

Records

Air carriers must retain all books, records and other source and summary documentation for 7 years to support subsidy claims.

 

Financial Information

Account Identification

69-8304-0-7-402.

Obligations

(Direct payments) FY 07 $50,000,000; FY 08 est not available; and FY 09 est not reported.

Range and Average of Financial Assistance

For continental United States: $247,122 to $1,733,997 annually per point; $636,161 annually per point average.

 

Program Accomplishments

Essential air service has been maintained with subsidy support at approximately 154 communities affected by airline deregulation.

 

Regulations, Guidelines and Literature

49 U.S.C. 41731, et seq.; 14 CFR, Parts 204, 271, 323, 325, 398.

 

Information Contacts

Regional or Local Office

None.

Headquarters Office

Director, Office of Aviation Analysis, X-50, Department of Transportation, 400 Seventh Street, SW., Washington, DC 20590. Telephone: (202) 366-5903 Use the same number for FTS.

Web Site Address

http://ostpxweb.dot.gov/aviation/index.html

 

Related Programs

None.

 

Examples of Funded Projects

(1) Great Lakes Aviation-Essential Air Service to Alliance, Chadron, Kearney, and McCook, Nebraska. (2) Big Sky Airlines-Essential Air Service to Glasgow, Glendive, Havre, Lewistown, Miles City, Sidney, and Wolf Point, Montana. (3) Alaska Airlines-Essential Air Service to Cordova, Gustavus, Petersburg, Wrangell, and Yakutat, Alaska.

 

Criteria for Selecting Proposals

Established by statute and by precedent in individual docketed cases.



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