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Catalog of Federal Domestic Assistance

Program Descriptions

20.901:  Payments for Essential Air Services

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

PROGRAM AND AWARD	FINANCIAL AND INFORMATION CONTACTS
ELIGIBILITY REQUIREMENTS	FINANCIAL AND ADMINISTRATIVE INFO.
APPLICATION AND AWARD PROCESS	INFORMATION CONTACTS
RELATED PROGRAMS	ASSISTANCE CONSIDERATIONS
PROGRAM ACCOMPLISHMENTS	POST ASSISTANCE REQUIREMENTS

20.901 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.

20.901 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 302.37.

Renewals:  If selected air carrier is willing to renew, renewal may be by show-cause procedures under Part 302 of the Department's regulations; otherwise, application procedures are repeated.

Criteria for Selecting Proposals:  Established by statute and by precedent in individual docketed cases.

Examples of Funded Projects:  (1) Great Lakes Aviation-Essential Air Service to Alliance, Chadron, Kearney, McCook, and Norfolk, 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.

Range and Average of Financial Assistance:  For continental United States: $158,417 to $1,308,444 annually per point; $599,215 annually per point average.

20.901 RELATED PROGRAMS:

20.901 PROGRAM ACCOMPLISHMENTS:

20.901 FINANCIAL AND ADMINISTRATIVE INFO:

Federal Agency:  OFFICE OF THE SECRETARY, DEPARTMENT OF TRANSPORTATION

Type of Assistance:  Direct Payments for Specified Use.

Obligations:  FY 99 $44,972,270; FY 00 est $50,000,000; and FY 01 est $50,000,000.

Budget Account Number:  69-8304-0-7-402.

Authorization:  49 U.S.C. 41731 - 41742.

Regulations, Guidelines, and Literature:  49 U.S.C. 41731, et seq.; 14 CFR, Parts 204, 271, 323, 325, 398.

20.901 INFO 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. Phone: (202) 366-1030. Use the same number for FTS.

(See Appendix IV for more contact info.)

20.901 ASSISTANCE CONSIDERATIONS:

Formula and Matching Requirements:  None.

Length and Time Phasing of Assistance:  In accordance with Department evaluation and determination of demonstrated need.

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.

20.901 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.