Airport Authority eyes continued growth in proposed contract

MANISTEE COUNTY — The Manistee County Blacker Airport Authority recently set the stage for its next two years of service, but not without a long term mission in mind.

Growth has been the buzzword for airport officials, and their recent proposal to continue Alternate Essential Air Service with carrier Public Charters follows a steady approach toward that goal.

This week, airport director Barry Lind updated the board on the status of that proposal, which has been submitted to the U.S. Department of Transportation (DOT), the agency ultimately charged with approving Blacker’s proposed commercial service.

“The only feedback I’ve had so far from DOT is the acknowledgement that they’ve received (our proposal),” he said. “From a timeline perspective, I’m anticipating that their approval process will probably be on the order of two months. That’s typically their turnaround time.

“If they do have any concerns or suggested changes, I would hope that we would have that by our meeting next month (at 10 a.m. on March 12 at 2323 Airport Road in Manistee),” he added, “so that we can then turn it around.

“I would hope that we get approval by April.”

Throughout January, the airport authority went through the bid process for Essential Air Service (EAS), as its current contract with Public Charters expires in July. Authority members heard proposals from a trio of EAS providers, as well as Public Charters, and ultimately elected to continue its relationship with the current provider, through the “Alternate” EAS program.

According to DOT, the EAS was put into place to guarantee small communities that were served by certificated air carriers before airline deregulation maintain a minimal level of scheduled air service.

DOT is mandated to provide eligible EAS communities with access to the National Air Transportation System and is responsible for requesting and approving bids from air service providers for these EAS eligible airports.

In 2012, Blacker was the first airport in the nation to take advantage of DOT’s “Alternate” Essential Air Service, which, according to DOT, is designed to allow communities to forego their EAS for a prescribed amount of time in exchange for receiving a grant to spend in a variety of ways that might better suit their unique needs.

The Alternate EAS program grants funds directly to the airport authority instead of the air carrier, localizing the recruitment of and agreement with air service providers that would not otherwise meet EAS guidelines. DOT, however, still must approve these Alternate EAS proposals.

Blacker’s proposal to DOT, in summary, states:

“The Manistee County Blacker Airport is proposing to provide for the air service needs of the Manistee/Ludington communities and surrounding areas by contracting with Public Charters, Inc., a Part 380 Indirect Air Carrier for a period of two years. Such air transportation is planned to continue to be to Chicago Midway Airport, with 30 seat Dornier 328JET, 19 seat Beech 1900 or equivalent twin-engine aircraft conducting regularly scheduled public charter flights. The frequency of flights may vary seasonably as required to meet demand. However, once daily service during the off peak season and twice daily service during the peak season is anticipated.”

Agreements listed in the proposal include:

• The airport, in exchange for an Alternate EAS Grant from the Department in the amount $2,990,574.89 per year of the grant, will forego its participation in the traditional EAS program for a period of two years, commencing when this agreement is fully executed or the end of the current Alternative EAS grant, which ever is later;

• The airport will contract with a Part 380 Indirect Air Carrier (Public Charters, Inc.) to provide scheduled public charter flights to a medium or large hub, with a minimum of twin engine 19 seat aircraft. Compensation necessary to provide and market such service will come from the Alternative EAS Grant funds;

• While continued service to Chicago Midway Airport is planned, in the flexibility provided by the Alternate EAS program Blacker requests the option to provide service to other medium or large hubs (in keeping with the intent of providing connectivity to the national air transportation system) within a 500 nautical mile (575 statute mile) radius. This may be done in addition to Chicago Midway (testing alternative hubs) or instead of Chicago Midway. Regardless of the hub the subsidy calculation would be based on the same formula and subsidy maximums;

• Service will be non-stop or one-stop from Manistee to the hub airport with no restrictions on up line scheduling;

• The airport and indirect air carrier reserve the right to provide equivalent service with substitute aircraft in the event of mechanical problems or other unforeseen circumstances. The airport and indirect air carrier also reserve the right to adjust frequency from time to time to reflect seasonal changes in demand and to provide greater or less frequency than planned, however any flight operated that results in subsidy amounts greater than the above monthly and yearly maximums while allowed will not be subsidized; and

• The airport specifically reserves its right as a subsidy eligible EAS point to reinstatement in the traditional EAS program.

Part of Blacker’s long-term strategic plan is to eventually reach 10,000 departing passengers annually, making the airport eligible for $1 million in capital improvement grants from the federal government. With less than 10,000 enplanements, the airport is eligible for $150,000.

The magic number was discussed by members of the authority at their regular monthly meeting this week.

“If we look at the big picture, and our goal is to get to 10,000 enplanements, it’s not going to happen under this two-year contract,” said authority member Mark Bergstrom, citing that Blacker saw 5,040 departing passengers in 2017. “So, how do we get to that? What is our strategy to get to 10,000 and is it really possible?”

“It is possible,” said authority chair Brook Shafer, citing projected passenger growth under the current proposal. “We project a 10 percent growth (this year). We know we’re not going to get to our pie-in-the-sky ‘10,000’ in two years, but we are going to grow and, with the service we’ve selected, we have the potential to grow at that rate for two years.

“In two years, we’ll have to look at something that will push us even further,” he added. “You figure, the best case, we grow 20 percent between now and the end of the contract, so at that point you’re looking at 6,000 enplanements.

Lind concurred that these steady annual increases may lead to more options in future EAS bidding processes.

“Incremental growth is helpful, because it makes us more attractive (to air service providers),” he said. “So, we need to do whatever we can to grow at whatever rate we’re able to, to become more attractive.”

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Posted by Dylan Savela

Dylan is the county reporter for the News Advocate, he also is in charge of the Small Town Life, religion and senior pages. He can be reached at (231) 398-3111 or dsavela@pioneergroup.com.

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