The US Department of Transportation (DOT) has affirmed the selection of Cape Air (9K, Hyannis) to provide state-subsidised essential air service (EAS) at Bar Harbor in Maine.

The DOT in a regulatory notice said it had reviewed and denied a petition for reconsideration filed by Silver Airways (3M, Fort Lauderdale Int'l) that the DOT stay its order issued on September 24, 2020, whereby it had selected Cape Air to provide EAS at Bar Harbor for a four-year term from October 15, 2020, through October 14, 2024.

Cape Air provides EAS from Bar Harbor Hancock County Airport to Boston using nine-passenger Cessna (twin piston) 402s or nine-passenger Tecnam P2012s. Cape Air provides 21 non-stop round trips per week in the off-peak winter season (mid-October to mid-June) and 56 non-stop rotations per week in the peak summer season (mid-June to mid-October) for each year of the contract term. It is subsidised as follows: USD3.3 million in the first year, USD3.4 million in Year Two, USD 3.6 million in Year Three, and USD3.7 million in the final year of the contract.

On September 29, 2020, Silver Airways filed a petition asking the DOT to stay its order and reconsider Cape Air’s appointment because of what it alleged was an illegal conflict of interest in terms of Maine law. Silver Airways had alleged that a Cape Air employee served on the Bar Harbor Airport Advisory Committee (AAC), which had recommended the appointment of Cape Air to the Hancock County Commissioners. The airline alleged the Cape Air employee had participated in the AAC’s deliberation of Cape Air’s proposal and in the AAC’s vote to recommend Cape Air.

Silver Airways had also claimed that its proposal had been superior to Cape Air’s in each of the statutory criteria, that the DOT’s decision had been “arbitrary and capricious,” “deficient as a matter of law,” and had “failed to articulate a well-reasoned basis” for its selection of Cape Air.

The DOT dismissed the allegation of conflict of interest as the Cape Air employee was only one of several AAC members, which had only made a recommendation to the Hancock County Commissioners. The ultimate recommendation from the community was made by the County Commissioners, a body on which the Cape Air employee did not serve.

The Department also was neither authorised nor required to “second-guess” the legitimacy of a community’s recommendation, neither did it prescribe the process by which a community made its recommendation, nor did it have the authority to review the basis upon which a local airport determined what persons should be members of its airport advisory committee, the DOT said.

The regulator confirmed that Cape Air’s proposal had met all five criteria required and that its service and subsidy levels were reasonable. “Cape Air has served Bar Harbor for more than a decade and during that time has provided the community with reliable EAS." In addition, it said, Cape Air’s codeshare with JetBlue Airways (B6, New York JFK) provided passengers with connectivity and access to the national air transportation system through Boston. Cape Air’s proposal had also sought a lower subsidy over a longer term, it concluded.