Lobbying Results in Competition for Adak Air Service
Friday, July 27 2012
Earlier this year, it looked like Adak was going to lose jet service as part of cutbacks to the federal Essential Air Service program. It turns out they might keep it after all - at least for a little while.
For almost a decade, Alaska Airlines has been flying a Boeing 737-Combi plane to Adak twice a week. But in February, the company announced it wasn’t interested in renewing its contract after it expired on June 30. The Department of Transportation, which administers the federal subsidy program, put out a request for other bidders on the route. Only one airline replied and the DOT rejected their bid, citing high cost and lack of community support. So, in May, the bidding process reopened.
The second round of bidding ended on Tuesday and four airlines submitted proposals -- two cargo carriers, one passenger carrier and, unexpectedly, Alaska Airlines.
Regional Vice President Marilyn Romano says the company’s change of heart resulted from a significant decrease in the price of jet fuel and some serious lobbying from the local community.
“They all believe that there’s a growing future in Adak,” Romano says. “That they kind of went through a slump and that things are starting to turn around for them out there and that they could possibly see some growth in the future. And they wanted to make sure we knew all of that and that we would take that into consideration in any decision that we made.”
Romano says they did. She personally spoke with several fishing companies and an oil company before the airline submitted a bid. Alaska is requesting a $1.6 million annual subsidy for the route, the same amount they were being paid for their last contract. That’s the lowest of the four bids and the only proposal with combined air and cargo service. However, unlike the other airlines, Alaska is asking the DOT for only a one-year contract, as opposed to the typical two year contract. Romano says the airline is still not convinced that 737 service is the best option for the community of 300 people.
“So for right now basically we’d like to keep it status quo, give us a year to continue to work with the community and see if there are any other options, but based on everything else we knew going into the second bidding, we felt like we need to go ahead and do a bid.”
Romano wouldn’t speculate about Alaska’s chances of being awarded the contract, saying only that the airline feels like it’s well-positioned. The other bidders were Everts Air Cargo, Northern Air Cargo and Era.
The public has until August 22 to submit comments on the proposals. The DOT is expected to make a decision shortly thereafter.