Essential Air Service

[Way2Broke]

Does anyone know anything about how essential air service bids work?

 

[NEDude]

I believe I have a good feeling for the basics, so I will do my best.

First off, at its basic premise, EAS is only available to airports which had scheduled airline service prior to deregulation in 1978. I emphasize airports because that is how the provision is written, it covers the actual piece of land, not the community. If the community decides to close or relocate an airport, technically speaking, it is not eligible for EAS. This will be an issue in Plattsburgh, NY where the county has voted to close the long operating Clinton County airport and move operations over to the former Plattsburgh Air Force Base.

If an airport has/had scheduled service from one carrier, and that carrier decides to stop service, the DOT can issue a stay of that termination and provide an at-cost subsidy to the carrier as it opens the bidding process for all airlines.

Input is gathered from local and state government and business leaders on preferences for destinations, aircraft type and frequency. Some of that does influence the final decision. My company landed an EAS bid in part due to the community preference for turbine aircraft (the competing bid proposed piston twins). We lost a bid to another carrier because of the community preference for the other carriers proposed destination.

The interested airlines submit proposals to the DOT for cost, proposed frequency and destinations. The DOT weighs all of the proposals against community preferences and selects a winner. The contract is issued for a period of time (usually 1-3 years). After the contract expires, the process repeats.

Also note that over the years, the DOT has toughened the requirements for EAS. Utica, NY lost its eligibility for EAS because the DOT determined it was too close to Syracuse and Albany and had major interstate highway to both of them. The DOT wants to get out of the EAS business, but thus far congressional leaders who represent small EAS communities have kept it alive.

Hope that helps a bit.

 

[Clutch_Cargo]

I believe I have a good feeling for the basics, so I will do my best.

I think that is a very good feeling for the basics... nice post, NEDude. I also worked for a company that provided EAS... I don't think I could add much to NE's post w/o a lot of typing but I will give you a link to some more info... http://ostpxweb.dot.gov/aviation/X-50%20Role_files/essentialairservice.htm. Hope this helps a bit too!

cc

 

[check6]

Exactly right,

The airlines bid for it. Scenic outbid Skywest recently for service into Elko from Reno. I'm thinking this is an EAS situation but not sure.

 

[routeskd]

one other tidbit.....subsidy can not exceed $200 per enplaned passenger over the duration of the contract or the subsidy can be terminated

 

[belchfire]

Once awarded the contracts are typically
for a two year period and do not nessisarily
go to the lowest bidder.

Avoid going to work for an airline that gets
most of it's money from these contracts,
or have an escape route...if you come in
at the end of a contract you could be in
for trouble.

The reason that these communities are getting
subsidized is that they are not profitable to
serve. Because the subsidy is fixed the companies
that serve them are susseptable to loss due to
things like fuel price and insurance cost escalation.
The only place they can save money is on their
employees...and they will!

Nuff said!

 

[mrkopaj]

Exactly right,

The airlines bid for it. Scenic outbid Skywest recently for service into Elko from Reno. I'm thinking this is an EAS situation but not sure.

Skywest dropped the route and Scenic picked it up. It is not EAS.