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Other cities in Great Lakes Airlines' contract find new carrier

Sunday, August 9, 2009

The last time Cape Girardeau's contract for subsidized passenger air service was awarded, Jackson, Tenn., and Owensboro, Ky., were part of the deal.

Great Lakes Airlines won that contract in February 2008 and with it the possibility of receiving up to $1.45 million in taxpayer help to fly between Owensboro and St. Louis. The subsidy amount for Jackson was set at $1.6 million.

Great Lakes never flew from either city. As recently as this spring, the company was still promising service, said Steve Smith, manager of McKellar-Sipes Regional Airport in Jackson. But in April, Great Lakes told the U.S. Department of Transportation it could not say when it would begin flying from either airport.

The two communities, as well as Cape Girardeau and more than 100 small cities nationwide, are part of what is called the Essential Air Service program. To ensure that those cities have air service, the department seeks proposals every two years. Carriers must describe the service they will offer, the aircraft they will use and the amount of taxpayer money they want to provide it.

Cape Girardeau is no longer linked to Owensboro and Jackson. It is, instead, grouped with three Illinois cities as well as Burlington, Iowa, and Fort Leonard Wood, Mo. Proposals for the next two-year contract for Cape Girardeau and the other five towns are due Wednesday and will be made public Thursday.

Cape Girardeau Regional Airport manager Bruce Loy said last week he is hoping for a variety of competing proposals for local service.

Pleased with bids

The Department of Transportation in April began seeking new service proposals for Owensboro and Jackson as well as four cities in Arkansas that also lacked service because Great Lakes had been unable to deliver. Eight carriers -- but not Great Lakes -- submitted their bids. One later withdrew, but Smith and his counterpart in Owensboro, Bob Whitmer, both said they were pleased with the amount of interest.

"We didn't get 100 percent of what we wanted, and we would like to have 50 passenger planes flying to four or five cities. However, I am just ecstatic," Smith said.

In the latest competition, Jackson and Owensboro recommended Pacific Wings, a Hawaii-based company that promised $39 one-way fares to Nashville, Tenn., and fares below $100 for service to Atlanta. Pacific Wings was awarded the contract, and with it the Essential Air Service program subsidies.

Many attractive features drew both communities to Pacific Wings, Smith said. Pacific Wings made its primary service to Nashville, which community surveys in both towns chose as the No. 1 destination.

The option to fly into Atlanta with its large number of connecting flights also fit with the community surveys that selected it as the No. 2 preferred destination. And Pacific Wings' record, emphasized in its proposal, of taking on Essential Air Service contracts with the goal of eliminating the need for subsidies by using new, efficient aircraft and luring large numbers of passengers also drew interest, Smith said.

Pacific Wings no longer needs subsidies in Hawaii, it reported in its proposal to the Transportation Department. It also eliminated the need for subsidies for its operations in Hobbs, N.M.

The subsidy requested by Pacific Wings for Owensboro was $1.07 million, 26.2 percent less than the amount awarded to Great Lakes in February 2008. The amount sought for Jackson was $1.23 million, 23.3 percent less than Great Lakes. Pacific Wings will operate as Kentucky Skies from Owensboro and as Tennessee Skies from Jackson. It operates as Georgia Skies in Georgia and New Mexico Airlines in New Mexico.

Smith said he had to be convinced that accepting nine-seat Cessna aircraft was a good idea. But promises from Pacific Wings that two aircraft would be available if a flight was overbooked convinced him.

Now both airports expect passenger service to resume Aug. 30, the first daily service for each city since Jan. 6, 2008.

Reliability issue

Owensboro hasn't been entirely without airline service. Allegiant Air, which specializes in flights to resort locations, provides two round-trip flights each week on 150-seat MD-80 jets that average 140 passengers each flight, Whitmer said.

But reliable daily service is needed, Whitmer said. "We were real concerned about dependability. Great Lakes didn't show up at all, and Big Sky was here six weeks. We wanted somebody with a track record."

The Essential Air Service program prefers awarding contracts to airlines that offer twin-engine, 19-seat aircraft. But Whitmer and Smith both said they were convinced that new, fuel-efficient, nine-seat aircraft would work for their cities and if traffic grew, larger planes would be provided.

"It wasn't an easy selection process," Whitmer sad. "A couple of others offered nice proposals."

But in the end, it was hard not to choose Pacific Wings "because they had the track record we wanted."

rkeller@semissourian.com

388-3642

Proposals for commercial passenger service out of Cape Girardeau Regional Airport are due Wednesday with the U.S. Department of Transportation. What city would be the best choice as a destination for area passengers?

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Pertinent address:

Cape Girardeau Regional Airport, Cape Girardeau, MO


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I am still wondering why Cape feels the need to participate in the essential air service program - things were fine when this town was left without air service. Why waste the taxpayer dollars on this venture when it is obvious that there are not enough people interested in flying in or out of this airstrip.

-- Posted by Beaker on Sun, Aug 9, 2009, at 12:30 AM

Beaker,

Pretty straight to the point. Here's my IMO answer. Probably because 3 execs from P & G need flight service weekly. But hey....Cape's all about Catering to the rich, famous, and newbie snake oil salesmen

-- Posted by Ainamolagem on Sun, Aug 9, 2009, at 7:59 AM

what a joke. Says a lot about Cape and their ability to negotiate and enforce a contract.

-- Posted by mohacker on Sun, Aug 9, 2009, at 8:51 AM

mohacker: You have missed the point of the last two articles. The contract isn't with the city. It is with the Department of Transportation. The big is also made to the Department of Transportation. The city gives input on which service it would like to see.

For those not wanting it because of the money. The money is going to be spent regardless of Cape Girardeau participating or not. So why not be a part of the program?

Believe it or not, there are businesses that will only locate to communities that have commercial air service.

Let me throw out a question. What if P&G were to say that they would not stay in the area if there wasn't commercial service available at the Cape Girardeau airport? Would you be willing to lose the program? Or what if another company, with similar size to P&G, were looking at moving to Cape Girardeau. Would you want to miss out on the opportunity for the community?

-- Posted by SEMissouri70 on Sun, Aug 9, 2009, at 2:22 PM

As a P&G employee, the last time that I flew out of Cape was in 1999, and that was on a chartered flight.

The common practice at P&G is to drive to Lambert, and catch a commercial flight to another hub, usually Atlanta.

I can't speak for the rest of the folks at P&G Cape, but this particular rich, famous, newbie snake oil salesman never even considers flying out of Cape. It's faster and cheaper to rent a car one way to Lambert.

-- Posted by Lumpy on Sun, Aug 9, 2009, at 3:22 PM

SEMO70, I think companies have gotten wiser about criteria pertaining to commercial air service. Regarding the comment "For those not wanting it because of the money. The money is going to be spent regardless of Cape Girardeau participating or not. So why not be a part of the program?" - I'm not sure it is wise to be a part of the problem. The problem as I see it is that the federal government has ballooned the deficit and they want to throw (or are willing to throw) more money to rural MO which does not benefit but only 2 or 3 individuals. Cape has already gotten plenty of bad press out of this with the subsidies approach $2000 per passenger. This town has also fallen victim to what I see as fraudulent schemes (eg: premier) and has lost alot of money as a result. My vote would be to close the airport down (or sell it to some private enterprise if they are willing to take on such a venture).

-- Posted by Beaker on Mon, Aug 10, 2009, at 9:44 AM

I just hope it will go to STL.

-- Posted by ArcticFox on Mon, Aug 10, 2009, at 2:20 PM


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