Governor: Increase airline subsidy

ESCANABA - Gov. Jennifer Granholm recently asked the U.S. Department of Transportation to increase Mesaba Airlines Essential Air Service (EAS) subsidy for the Delta County and Ford Airports in Escanaba and Iron Mountain. Mesaba Airlines, which currently provides EAS to the two airports, projected their cost of fuel at $2.47 per gallon when they were awarded the contract. She said in a letter to the DOT that since that time gas has increased to $4.66 in Iron Mountain and $3.87 in Escanaba.

"As a result, Mesaba expects a deficit of $600,000 per year at the current price of fuel," Granholm said. Granholm explained in her letter that the communities had already been without air service for two months when Skyway Airlines terminated all flights to and from the airports.

"These unanticipated expenses could result in another suspension of this critical service to Michigan communities if action is not taken," said Granholm. "When service is interrupted, these communities have no air service to the lower peninsula, a critical issue for families and businesses." Granholm said the DOT has the authority to make adjustments to EAS subsidies under current law, and asked, to prevent further service interruptions, that the DOT adjust the subsidy with Mesaba Airlines to reflect the current high costs of jet fuel.

Meanwhile, Thursday was the deadline for new bids to be made to the DOT for long-term air service proposals. Mesaba Airlines submitted a proposal, as well as another company called Great Lakes Aviation.

Delta County Airport Manager Connie Ness said Mesaba's original bid - what they are currently receiving, per year - is approximately $2.2 million.

Mesaba's new bid is $2,870,000 per year for service to and from Delta County and Ford Airports. Great Lakes Aviation bid the two separately, with Iron Mountain at $1,475,879 and Escanaba at $1,458,750, a total of $2,934,629 per year for both communities.

Ness said Mesaba's bid includes "basically the same schedule they're doing now," with the increased monetary subsidy from the government to make up for higher fuel costs.

Mesaba currently sends a flight to and from Minneapolis and one to and from Detroit each day.

Great Lake Aviation's bid includes service to Chicago three times per day on a smaller aircraft than Mesaba currently uses, according to Ness.

Ness said the Delta County Airport will probably recommend to the DOT to accept Mesaba's bid, because they are already here and set up.

"(Great Lakes Aviation) bid in the past and they weren't abel to fulfill the commitment," said Ness. "I think that given the timing and what our community has been through that we would definitely want to stay with Mesaba...because Mesaba is here and Mesaba is established and we need the stability, and I think the DOT would tend to agree."

Ness said the airport's emplanements are down from the first interruption in air service in April and May of this year.

"We had (about) 300 boardings in June, (and) we generally run close to 600," said Ness. "The fact that they weren't here for two months and we were without air service - that's the biggest factor. The people planning trips may have purchased tickets from elsewhere or made other arrangements.

"We look forward to continuing to provide essential air service to these communities under a subsidy that better reflects our significantly higher fuel costs," Mesaba Aviation, Inc. President John G. Spanjers said in a letter to the DOT.