Wednesday, June 25, 2014

Kearney Regional Airport (KEAR) couldn’t land new carrier: City retains only bidder Great Lakes; consultant failed to lure other airlines

KEARNEY — Despite aggressive efforts to attract a new airline provider to the Kearney Regional Airport, the most recent bid process did not bring any new players to the table.

For the last few years, the city has been working to contract with a new airline, City Manager Mike Morgan said. In particular, the city has had serious discussions with SkyWest Airlines, a regional airline based in Utah.

Great Lakes Airlines, the current air service provider in Kearney, serves most of the rural airports in this part of the Midwest, Assistant City Manager Suzanne Brodine said. However, because of new Federal Aviation Administration regulations that took effect in fall 2013, Great Lakes has struggled to find pilots to fly its airplanes. The new regulations increased the number of hours that pilots must have in the air before they can fly certain aircraft.

Pilot shortages have resulted in an increased number of flight delays and cancellations at the Kearney airport.

“There’s obviously dissatisfaction in the level of service and cancellations that have occurred over the last few years,” Morgan said. “That’s why we’ve worked so hard to find an alternate service. We looked at every option we could think of.”

The Kearney Regional Airport requests bids from airline providers every two years. In preparation for this year’s bid, the city hired a Colorado-based independent consultant to solicit bids from other air carriers. The consultant had meetings with SkyWest, American Eagle Airlines based in Fort Worth, Texas, and United Airlines, one of the largest passenger airlines in the United States.

The city also considered a stop-and-go service from Kearney to Lincoln or Omaha as well as a partnership with Scottsbluff or North Platte to entice an airline to offer en-route service at both airports, Morgan said.

All of those efforts fell short, however, when no other airline made an offer by the June 12 bid date.

“We were very hopeful, but unfortunately we did not receive any other bids,” Morgan said. “There are a variety of factors that play into that decision. Sometimes it’s just the timing. If there were another bid next week, it could go differently.”

Great Lakes Airlines submitted the only bid for the Kearney Regional Airport and the airports in North Platte and Scottsbluff. The bid for the Kearney airport was nearly $3 million, almost $1 million more than the previous year, Morgan said.

In its bid, Great Lakes also proposed offering a nine-seat configuration on its standard Beech 1900D aircraft, which typically carries 19 passengers. By eliminating those 10 seats, the airline can hire pilots from a larger pool, according to its bid.

“This allows our new hire pilots to operate the Beech 1900D aircraft in a nine-seat configuration and will enable Great Lakes to restore pilot staffing levels,” the bid letter states.

Even with the reduction in seats per plane, Great Lakes still estimates 12,750 enplanements, or boardings, at the Kearney Regional Airport in the next contract year, which begins Nov. 1.

Morgan said that number is not likely, because to reach it, the airline would need to fill every seat on every flight that departs from the airport. Currently, Great Lakes offers 18 nonstop round-trip flights per week to the Denver International Airport.

The number of enplanements per year is significant, because it determines whether the airport is eligible to receive a subsidy from the U.S. Department of Transportation. The airport must have at least 10,000 enplanements per year to qualify for a $1 million subsidy, which goes toward capital improvements, Brodine said.

Last year, despite the change in pilot qualifications, the Kearney airport saw its best year yet for enplanements, with 13,042 for the year.

However, enplanements numbers have dropped each month so far in 2014 when compared with 2013. Through May of this year, the airport has had 4,075 enplanements. It had 5,380 enplanements at that time last year.

Morgan said some of that decrease can be attributed to customers who have flown from Kearney in the past and had their flight delayed or, worse, canceled.

“It’s hard to get those people to come back, and it’s understandable,” Morgan said. “There’s a lack of reliability and dependability. If you’re flying out of Kearney, you need to know the flight will leave on time. I know people are frustrated.”

At this point, the city has until July 14 to offer comments to the Department of Transportation on the bid from Great Lakes. In that time, Morgan said the city will continue to explore other options.

“We will explore every avenue, and some avenues we may not have thought about yet,” Morgan said. “We have different options we’re weighing.”

Brodine said that even if it does not work out this year, the city will maintain contact with other airlines to keep Kearney’s name at the top of their lists.

“We want to make sure we’re ready and Kearney’s name is out there so that if the opportunity does present itself, we’re ready to take it,” Brodine said. “We know we have to be proactive to ensure that we’re doing our best to maintain air service. It’s still an essential function to the community.”


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