A Look at My 9 Least Favorite SCASDP Proposals (and the Ones that Won)

Oct 10, 2011

More Reading on This Topic: Fares, Government Regulation

Those of you who used to read me over on BNET know that I used to spend a solid week each year looking at my favorite Small Community Air Service Development Program (SCASDP) proposals. Since I’m no longer writing for BNET, I spent a lot less time reviewing the program this year, and that makes me sad. I have fun with this. And yes, this year I’m late. The awards already came out, but that won’t stop me from talking about them.

By “favorite,” I don’t mean I look at those proposals that are great. I’m talking about those that seem outrageously misguided to me. The point of the program is a good one. Unlike Essential Air Service which just continuously plows money into small city routes, SCASDP is a short term funding plan that requires serious justification. The money should be used for helping to jumpstart new service through revenue guarantees, marketing, etc. There are a few uses but the point is the same. Money is meant to help get a project on its feet, but it won’t be there forever.

There have been successes. SCASDP has been responsible for successful long-running routes from Akron/Canton and Santa Rosa, for example. These are routes that airlines might not have tried on their own, but with the financial backing initially, they found them to be winners. And plenty of airports are trying to do just that right now. Many of these are small cities trying to get connected into a hub. Others are trying to get low cost service, often from Frontier this year it seems.

So which ones stood out for me? Here are 9 of the goofiest ones. I’m sad to say that three of these actually got awarded a grant. Oy vey.

Albany, New York (WON) – Albany wants money to fund a flight to Houston, but that seems like a waste to me. It already has service from United and Southwest to several cities so it has access to their networks without having to go to Houston. Seems to me that the feds should have looked for proposals that would have had more of a network benefit than this, but the feds liked it and it got partial funding.

Arcata/Eureka, California (LOST) – Like every other airport, Eureka complains of high fares on its sole flights on United to San Francisco and Sacramento. So what’s the solution? It wants nonstop flights to Denver, on United, the same airline that has high fares today. All this would do is hurt United’s existing service and make the market weaker overall. It won’t lower fares. Delta failed with flights to Salt Lake and Alaska/Horizon failed down to LA. This market just can’t support more service right now, it would seem.

Bakersfield, California (LOST) – I don’t even get this. Bakersfield wants money to support 2 props a day up to Sacramento on Great Lakes. Without any connecting feed in Sacramento, this is bound to fail. There is a strange suggestion that there will be another 20 people connecting to Portland or Seattle. Really? I can’t see it – people going there would probably just take an existing airline that actually offers online connections.

Bemidji, Minnesota (LOST) – I’ll give these guys points for creativity. They seem to think that people don’t fly out of Bemidji because they don’t know the airport has flights. So what will they do? Create a travel desk to book flights for people in Bemidji and those coming to town. This just isn’t going to do much since we all know that people coming to town aren’t going to call Bemidji to have flights booked. And locals should know the airport exists – they just drive because it’s cheaper or flights are more convenient from other airports.

Casper, Wyoming (LOST) – Casper thinks that fares are too high on the short flight down to Denver on United. So what does it want? It wants Frontier to come in to lower fares. It says it asked United to lower fares to levels seen during the 1990s and early 2000s but was rebuffed. Apparently it forgot that fuel has spiked dramatically. So if Frontier comes in, what happens? It could push United to run away because lower fares will destroy the market. Then Casper would be pretty unhappy.

Dubuque, Iowa (WON) – I love Dubuque because it has had some great, creative proposals in the past that didn’t win. So what happens? The city comes up with a not-so-good one and it wins. Go figure. Dubuque has been losing service and now it only has American Eagle flights to Chicago. What does it want? American flights to Dallas. This won’t help fares and it will likely weaken the Chicago flights by pulling people away. There’s limited additional benefit to Dubuque, but guess what? It’s going to get a shot to see if it works.

Flagstaff, Arizona (WON) – Flagstaff is like many small cities in thinking that it’s perpetually underserved and it deserves better than what it gets. In this case, that’s turboprop flights to Phoenix. It also says fares are too high. In fact, it says the average fare is $58 one way higher than Phoenix. That doesn’t seem too unreasonable to me, but Flag thinks it knows that the premium should only be $30 to $35 one way. So Flagstaff wants a new airline to come in. It did have Alaska/Horizon to LA for a brief time but that failed. Why would some other service work? It won’t. But it won a grant, so we’ll probably see someone else come in soon.

Mammoth Lakes, California (LOST) – Mammoth gets the brass balls award for having the gall to ask for this one. It has been subsidizing year-round flights, but it doesn’t have the money to continue. Without more money, the non-winter flights will probably go away, so it wants the feds to pump more money in. If the service doesn’t work now, then why would federal funds make it work? It wouldn’t.

Marquette, Michigan (LOST) – Marquette is on the Upper Peninsula of Michigan, meaning it’s basically Canada. So it wants service to the state capital, Lansing, because you can only get there via connections today. The problem is that a Marquette to Lansing flight will never have enough demand to support itself, ever. So why bother throwing money down a hole to subsidize it for a short time knowing it won’t work? There’s no good reason.

In the end, the feds selected 29 winners. That means more than 40 percent of applicants got a grant. Not too shabby. There were some winners that I liked to see. For example, I think Auburn/Lewiston, Maine had a good pitch for finally getting its first scheduled flights. I also think Latrobe, Pennsylvania has a good case for trying to further build its newly-acquired flights from Spirit. In fact, I’d say that this year, I probably liked what the DOT did more than in previous years, though clearly we still have some strong disagreements. That’s no surprise. Read the full list of grants here.

But congratulations to all the communities that won new service. Even if I’m skeptical in some cases, I hope that you can all make it work.

[Original photo via Flickr user Jeff Samsonow/CC 2.0]

Brett

15 responses to “A Look at My 9 Least Favorite SCASDP Proposals (and the Ones that Won)”

David SF eastbay

Oct 10, 2011 at 7:41 am

Eureka is one of those places that driving to/from the area is a vacation in itself. Seems like only locals and those doing business would want to fly but anyone who wants to visit there would tend to be westerns who know the drive may take longer but you will enjoy all the places to and from the area to stop and visit. Other then maybe a flight north to Portland to connect to the northwest, service to SFO should cover their needs to everywhere else.

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Sanjeev M

Oct 10, 2011 at 11:00 am

The Albany grant is ridiculous. They have so many options on most of the majors (I include Southwest in that). Not to mention that Stewart Airport in Newburgh is only 90 min or so south. Plus they have half decent rail service to New York.

But as you say, at least SCASD is currently better than EAS :)

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JayB

Oct 10, 2011 at 11:09 am

One other SCASDP grant I rather enjoyed was the $500,000 to Harrisburg, Pa. for a revenue guarantee in hopes of getting Frontier to provide service to Denver. Of course, MDT already has AA, CO, DL, FL, UA, and US providing service there, to ATL, BOS, CLT, CVG, DTW, EWR, IAD, LGA and ORD, but hey, why not get federal money to add another carrier to another city.

Now, the EAS program is to get service where there is none to any place at all. I know, you’re not a “big” proponet of the EAS, but if federal monies are to used at all, why not the EAS? The EAS service is highly regulated, like deregulation never happened.

[Full disclosure, I’m biased here. I use the Lancaster, Pa.,/BWI Cape Air service, although sadly, the primary reason for that travel ended Sept 19. But, this service, for which Cape Air’s contract was good through Sept. 30, and which is technically no longer eligible under the recently enacted 90-mile rule, was given an extension by DOT through January 31. Cape Air asked to continue the service, but at a 20 percent increase in subsidy.]

Of course, they say the world is to end October 21, so whatever!

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1. CF
  
  Oct 10, 2011 at 3:21 pm
  
  Yeah, Harrisburg was similar to the Albany request in that sense, but I included Albany over Harrisburg because at least the latter was trying for a new airline.
  
  I really have no problem with EAS in theory, but it’s such a huge waste of money in its current form. There have to be better ways to do it. Only fund airports that are really far from alternates and push smaller 9 seat aircraft that are less costly to operate and better match demand. Lancaster uses those 9 seaters, so that’s a good example of where it can go, except Lancaster is only 30 miles from Harrisburg, 75 from Philly, and 85 from Baltimore so very few people are going to use it.
  
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David M

Oct 10, 2011 at 12:35 pm

The Bakersfield-Sacramento request sounds like a move being promoted by politicians to get themselves a flight up to the state capital.

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DesertGhost

Oct 10, 2011 at 1:27 pm

The Bemidji request is interesting to me. I lived in Bemidji when I was a kid (a long time ago). We had flights then, on North Central (the original home of Herman) Airlines DC-3s. My dad flew into Minneapolis from time to time on business and loved to take us to the airport to watch the plane. He’s take us to the rail yard too, where I got scared by the loud steam engines. There were still steam engines (real “choo choos”) in Bemidji back then.

I guess my interest is based on the memories of my father and the DC-3. Thanks for stirring them. I do seem to have a thing for extreme climate, though. Climates in the lower 48 don’t get a whole lot more extreme than Phoenix and Bemidji.

More directly to the topic, Bemidji is right in the middle of northern Minnesota between Grand Forks, Duluth and International Falls. So it makes sense to keep some air service there, at least geographically. But the airport’s rationale in its request is strange to say the least. It’s not like Bemidji has never had air service.

Yet, who wouldn’t want to see Paul Bunyan and Babe, the blue ox, standing in the park by Lake Bemidji. Who also wouldn’t like to say they waded (more like walked) across the Mississippi River? You can near Bemidji, where the river, not much more than a babbling brook, flows out of Lake Itaska, its source. I was all of five years old or so when I did it. I’d like to do it again before I die. It’s on my bucket list. This is probably far more than you ever wanted to know about me or Bemidji, but thanks again for jogging some fond memories of my dad.

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1. A
  
  Oct 10, 2011 at 3:59 pm
  
  I’ve gotta comment on the Bemidji request as I have a good friend that located there for the sole purpose of “living isolated in the north woods.” The main attraction is tourism and their small state college. The timber industry isn’t what it used to be and there really isn’t much else there. I’m amazed there are year round flights there in the first place. Seasonal seems a stretch as most vacationers come up to camp with lots of gear.
  
  Regardless, my friend does travel and has used the Bemidji airport, however he usually flies out of FAR or MSP as the drive is easier than the higher fares and bad connecting times. Seriously, in less than 2 hours he can drive to Fargo and get much better service. A 4-5 hour drive and he’s at MSP. Bemidji isn’t Alaska or places like rural Montana where a population center is more than a day’s travel in the car.
  
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  1. DesertGhost
    
    Oct 10, 2011 at 6:59 pm
    
    Thanks for the insight. When I do go to Bemidji, I’ll probably fly into MSP and drive from there.
    
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Cedarglen

Oct 10, 2011 at 4:03 pm

Thanks for posting this summary. Yes, I read through the entire list of 29 grants for 2011 and I believe that the vast majority of them are truly wasted dollars. On the bright side and in the greater scope of DOT spending, this $14M+ program is not huge. Why I think it is mostly a waste: Smaller communities that wish to establish or expand service to **existing regional hubs** have a strong case for support and a few grants are of this type. The terrible grants were awarded to very small communities who want to establish or expand Direct Service to city pairs in wholly different regions of the country, essentially bypassing many local and regional hubs, including large cities with service from multiple large carriers. That, in my opinion is a collosal waste of money! As an example, Albany, NY thinks that they need Direct Service to Dallas, TX! Absolute nuts. If they need help in establishing service to some Northeast hub for onward connection to Texas, perhaps. But direct service? If Albany generated enough traffic to Dallas, a major carrier wold be providing it – and without a subsidy. I believe the same to be true for the Spokane, WA grant for service to the Los Angeles basin. Spokane is already served by carriers capable of routes to Los Angeles. If those carriers saw a market for direct flights, they would be flying them. -CG

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Bill from DC

Oct 11, 2011 at 8:16 am

I know I wouldn’t be the only one that would like to see Brett’s analysis of the remaining winners! Whaddya say, Brett, two down, 27 to go?!

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1. CF
  
  Oct 11, 2011 at 9:26 am
  
  The problem is that most of these are pretty straightforward and not too interesting. I try to pull out those that seem unique to me in one way or another and talk about them. But it would get really boring, really quickly to go through every one on paper.
  
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  1. Bill from DC
    
    Oct 11, 2011 at 11:37 am
    
    Fair enough. How about the EAS winners?! :-)
    
    Reply
    1. CF
      
      Oct 11, 2011 at 3:30 pm
      
      Do you have trouble sleeping at night? If so, then I can help you by going over the EAS bids. ;)
      
      Actually, if you’re really curious about EAS, I’d recommend this blog:
      http://www.easflights.com/
      
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Tony

Oct 12, 2011 at 12:13 pm

Many of these locations have fairly good ground transporation access with the subsidized interstate and local highways systems. Routes to and from the state capitals, many of which are equally located in remote areas, serve a minor market segment for government employees and state policymakers.

Some locations are within a few hours from a major airport with frequent ground transportation. Santa Rosa for example has frequent shuttle bus service to SFO.

Bakersfield is a highway hub for I-5, Hwy. 99, and Hwy. 58. It already has subsidized Amtrak rail services to Sacramento and Emeryville (San Francisco). Not to mention it is within driving distance from Los Angeles / Burbank / Ontario. Given that Bakersfield is within the oil producing region of California, an argument can be made for direct service to Houston if the demands warrants it.

The trip to Eureka on the Redwood Highway (US 101) is the destination. Otherwise service to SFO is adequate. Unless Eureka can re-brand itself as another Monterey or Santa Barbara with campionship golf courses and high end restaurants.

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My Five Least Favorite Winners of the 2012 SCASD Grants – >> The Cranky Flier

Aug 21, 2012 at 8:48 am

[…] cannibalize United’s existing San Francisco flights and that’s a bad plan. The airport tried for this same grant last year and lost, but apparently this year, the feds changed their […]

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