How essential is Essential Air Service?

How essential is Essential Air Service? Zach White

The economy has been in the dumps for several years, and budget concerns blanket all levels of government across the country.

A 30-year-old Department of Transportation subsidy for rural airports, called Essential Air Service, has caused some to question just how essential it is.

Established as a part of the 1978 Airline Deregulation Act, the subsidy was set up to pay airlines to provide service to communities that would otherwise be unprofitable to serve.

The program was set up to run for 10 years, to end in 1988, and would exist to either help an airline through deregulation to provide this rural service, or to wean rural communities off of having air service.

Then Congress passed the 1987 Airport and Airway Safety and Capacity Expansion Act.

This extended the subsidy another 10 years, scheduled to end in 1998.

In 1996, Congress passed the Federal Aviation Administration Reauthorization Act, which eliminated an end date for EAS, and started funding the program on a year-by-year basis under the Rural Air Service Survival Act.

Today the program pays more than $185 million to 153 airports. Of that, $12.5 million goes to 44 airports in Alaska.

Montana is the second most subsidized, with more than $8.5 million between eight airports, including Havre.

***Is it a waste?

With recent particular scrutiny on the federal budget, legislators have been looking for savings wherever they can.

Montana's sole representative, Republican Denny Rehberg, has supported the subsidy since he was elected to Congress in 2000.

When Essential Air Service was facing a temporary shutdown in early 2008, Rehberg issued a statement that the program is indispensable for his constituents.

"There's a reason they call it Essential Air Service, " Rehberg said. "These communities depend on it. "

When asked during the current legislative session, pressure to bring the deficit under control had changed that view a bit.

"Money is not infinite, and the irresponsible spending in the last four years has forced us to make tough choices today, " Rehberg said in early February. "There's just not enough money to fund everything we want. "No program is immune from waste, so there are no more sacred cows. Anyone who relies on federal funding has a patriotic duty to look for ways to get by on less, for the sake of our country's future. "

At the time, Rehberg said the preceding, the Senate was looking at a bill proposed by Sen. John McCain, R-Ariz., to end the program after 32 years.

McCain said in a Senate hearing on the bill that they might not have room for this program in these belt-tightening times.

"Although this program is called the Essential Air Service, in my view it's far from essential," McCain said.

By the end of the month the bill had been voted down 61-38, and EAS was spared.

***Is it vital?

Some of the McCain bill's biggest opponents were the senators from Alaska, as it would be their constituents that would be hit hardest.

One of the biggest benefactors of Essential Air Service is the community of Cordova, Alaska.

The fishing town, with fewer than 2,500 residents, is land-locked and relies on it's $2.7 million subsidy for nearly everything.

Martin Moe, the president of the Cordova Chamber of Commerce, said, for Cordova, the service is essential.

"That support given to this town and neighboring towns is invaluable to maintain the quality of life and to maintain business and the towns, " Moe said. "And that's what the EAS was instituted to do, to assist small remote communities so they did not have to lose quality of life. "

He said that most of the town makes its living through fishing.

There was once a day when Cordova's salmon were canned or frozen to be transported to where they could be sold.

Now the economy is based heavily on the delivery of fresh salmon filets, made possible by the regional jet service funded by EAS.

Moe said that it's not only the economy, but getting access to things like health care that makes the service indispensable.

Gerry Grabofsky, Havre's representative on the Montana EAS board, sees Essential Air similarly in Montana.

Which is why he was worried seeing congressional discussions on cutting both EAS and Amtrak funds.

"I thought it was plum nuts, " Grabofsky said. "We've got to have Essential Air Service and Amtrak. If they abolish those, we're back to the stagecoach to get in and out of Havre.

"For older folks, those two are their main sources of transportation. "

Grabofsky, though, has had his own issues with EAS lately.

He voted to change airlines in Montana after the current carrier, Great Lakes Airlines, was not reliable enough, cancelling flights repeatedly.

EAS subsidizes airlines by flights completed. If a flight is cancelled for a reason out of their control, like weather, the airline still gets the subsidy.

Great Lakes has had a large number of weather-related cancellations.

Moe said that Alaska Airlines cancels flights about four or five times a year.

***Is it both?

The service works better for some communities, based on a number of factors.

Airports are hoping to maximize the efficiency of their service under recent scrutiny.

Some airports have managed to get efficient enough to no longer require the subsidy.

At the Central Nebraska Regional Airport, manager Mike Olson wanted to change how Nebraska uses the subsidy.

"I think that the EAS program of the future is going to look vastly different than it does now, " Olson said. "My goal is for us to get off EAS. "

They have been served by Great Lakes Airlines, like Montana, since 2008.

But Olson was impressed with the record of American Eagle Airlines, a subsidiary of American Airlines that provides regional jet service.

American Eagle has gone into communities with EAS subsidies, such as Roswell, N.M., and Manhattan, Kan., and achieved what Olson wanted to.

"They did so well that they are also now unsubsidized, " Olson said. "Maybe that's the way of the future. "

Ed Martelle, a spokesman for American Eagle, said that their method isn't right for all EAS communities. They look for particular traits in prospective subsidy-seeking.

"We are always looking for cities that are underserved, or new air travel opportunities, " Martelle said. "A lot of the trick is just picking the right communities. University communities, state capitals, communities near major military bases and those kinds of approaches work very well for us. "

Olson agrees that EAS has its place, but it's not for everyone and maybe some changes are due.

"A lot of the smaller communities probably won't see things like regional jet service, but larger communities like Manhattan and Grand Island and Columbia (Mo.) can draw passengers, " Olson said.

For the smaller communities, as Moe said, "it would be extremely difficult financially on the residents without the EAS. "

But for larger communities, the subsidy could wean the community off of the government money, like it was supposed to by 1987.

The economy has been in the dumps for several years, and budget concerns blanket all levels of government across the country.

A 30-year-old Department of Transportation subsidy for rural airports, called Essential Air Service, has caused some to question just how essential it is.

Established as a part of the 1978 Airline Deregulation Act, the subsidy was set up to pay airlines to provide service to communities that would otherwise be unprofitable to serve.

The program was set up to run for 10 years, to end in 1988, and would exist to either help an airline through deregulation to provide this rural service, or to wean rural communities off of having air service.

Then Congress passed the 1987 Airport and Airway Safety and Capacity Expansion Act.

This extended the subsidy another 10 years, scheduled to end in 1998.

In 1996, Congress passed the Federal Aviation Administration Reauthorization Act, which eliminated an end date for EAS, and started funding the program on a year-by-year basis under the Rural Air Service Survival Act.

Today the program pays more than $185 million to 153 airports. Of that, $12.5 million goes to 44 airports in Alaska.

Montana is the second most subsidized, with more than $8.5 million between eight airports, including Havre.

Is it a waste?

With recent particular scrutiny on the federal budget, legislators have been looking for savings wherever they can.

Montana's sole representative, Republican Denny Rehberg, has supported the subsidy since he was elected to Congress in 2000.

When Essential Air Service was facing a temporary shutdown in early 2008, Rehberg issued a statement that the program is indispensable for his constituents.

"There's a reason they call it Essential Air Service, " Rehberg said. "These communities depend on it. "

When asked during the current legislative session, pressure to bring the deficit under control had changed that view a bit.

"Money is not infinite, and the irresponsible spending in the last four years has forced us to make tough choices today, " Rehberg said in early February. "There's just not enough money to fund everything we want. "No program is immune from waste, so there are no more sacred cows. Anyone who relies on federal funding has a patriotic duty to look for ways to get by on less, for the sake of our country's future. "

At the time, Rehberg said the preceding, the Senate was looking at a bill proposed by Sen. John McCain, R-Ariz., to end the program after 32 years.

McCain said in a Senate hearing on the bill that they might not have room for this program in these belt-tightening times.

"Although this program is called the Essential Air Service, in my view it's far from essential," McCain said.

By the end of the month the bill had been voted down 61-38, and EAS was spared.

Is it vital?

Some of the McCain bill's biggest opponents were the senators from Alaska, as it would be their constituents that would be hit hardest.

One of the biggest benefactors of Essential Air Service is the community of Cordova, Alaska.

The fishing town, with fewer than 2,500 residents, is land-locked and relies on it's $2.7 million subsidy for nearly everything.

Martin Moe, the president of the Cordova Chamber of Commerce, said, for Cordova, the service is essential.

"That support given to this town and neighboring towns is invaluable to maintain the quality of life and to maintain business and the towns, " Moe said. "And that's what the EAS was instituted to do, to assist small remote communities so they did not have to lose quality of life. "

He said that most of the town makes its living through fishing.

There was once a day when Cordova's salmon were canned or frozen to be transported to where they could be sold.

Now the economy is based heavily on the delivery of fresh salmon filets, made possible by the regional jet service funded by EAS.

Moe said that it's not only the economy, but getting access to things like health care that makes the service indispensable.

Gerry Grabofsky, Havre's representative on the Montana EAS board, sees Essential Air similarly in Montana.

Which is why he was worried seeing congressional discussions on cutting both EAS and Amtrak funds.

"I thought it was plum nuts, " Grabofsky said. "We've got to have Essential Air Service and Amtrak. If they abolish those, we're back to the stagecoach to get in and out of Havre.

"For older folks, those two are their main sources of transportation. "

Grabofsky, though, has had his own issues with EAS lately.

He voted to change airlines in Montana after the current carrier, Great Lakes Airlines, was not reliable enough, cancelling flights repeatedly.

EAS subsidizes airlines by flights completed. If a flight is cancelled for a reason out of their control, like weather, the airline still gets the subsidy.

Great Lakes has had a large number of weather-related cancellations.

Moe said that Alaska Airlines cancels flights about four or five times a year.

Is it both?

The service works better for some communities, based on a number of factors.

Airports are hoping to maximize the efficiency of their service under recent scrutiny.

Some airports have managed to get efficient enough to no longer require the subsidy.

At the Central Nebraska Regional Airport, manager Mike Olson wanted to change how Nebraska uses the subsidy.

"I think that the EAS program of the future is going to look vastly different than it does now, " Olson said. "My goal is for us to get off EAS. "

They have been served by Great Lakes Airlines, like Montana, since 2008.

But Olson was impressed with the record of American Eagle Airlines, a subsidiary of American Airlines that provides regional jet service.

American Eagle has gone into communities with EAS subsidies, such as Roswell, N.M., and Manhattan, Kan., and achieved what Olson wanted to.

"They did so well that they are also now unsubsidized, " Olson said. "Maybe that's the way of the future. "

Ed Martelle, a spokesman for American Eagle, said that their method isn't right for all EAS communities. They look for particular traits in prospective subsidy-seeking.

"We are always looking for cities that are underserved, or new air travel opportunities, " Martelle said. "A lot of the trick is just picking the right communities. University communities, state capitals, communities near major military bases and those kinds of approaches work very well for us. "

Olson agrees that EAS has its place, but it's not for everyone and maybe some changes are due.

"A lot of the smaller communities probably won't see things like regional jet service, but larger communities like Manhattan and Grand Island and Columbia (Mo.) can draw passengers, " Olson said.

For the smaller communities, as Moe said, "it would be extremely difficult financially on the residents without the EAS. "

But for larger communities, the subsidy could wean the community off of the government money, like it was supposed to by 1987.