Options to enhance the long-term viability of the Essential Air Service program
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2002-08-30
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Abstract:Over two decades ago, the Congress deregulated the airline industry, phasing out the federal ; government’s control over domestic fares and routes served and allowing market forces to ; determine the price, quantity, and quality of service. Concerned that air service to some small ; communities would suffer in a deregulated environment, the Congress established the Essential ; Air Service (EAS) program as part of the Airline Deregulation Act of 1978. The act guaranteed ; that communities served by air carriers before deregulation would continue to receive a certain ; level of scheduled air service. Special provisions were provided for guaranteeing service to ; Alaskan communities. In general, the act guaranteed continued service by authorizing the Civil ; Aeronautics Board, whose duties were later transferred to the Department of Transportation ; (DOT), to require carriers to continue providing service at these communities. If an air carrier ; could not continue that service without incurring a loss, DOT could then use EAS funds to award ; that carrier, or another carrier willing to provide service, a subsidy. These subsidies are intended ; to cover the difference between a carrier’s projected revenues and expenses and provide a ; minimum amount of profit.
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Main Document Checksum:urn:sha-512:dd17c2a29ab85413eb97d6be4a15102fa98f9abef5ef82d41f06fa2928a5c9474136abd197603b1123da2d1ff1e7d567396e1bb00cf294fe4c99dd0bae2037ae