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Using this Guidebook 19 Once the information is assembled, it must be presented to the airlines. The guidebook briefly discusses the best ways to make this presentation. Though each situation is unique, certain tactics are typically more effective than others. Finally, the guidebook briefly discusses how the airport should assess and re-evaluate its efforts. Air service development is a long-term effort, particularly during difficult financial times. The airport should plan on re-examining its goals and strategy and making needed adjustments along the way. Each step includes examples of how other airports across the United States have approached that aspect of ASD, and what their results have been. Part III includes a glossary of important terms and a series of Frequently Asked Questions. This part is intended as a point of reference for readers. The guidebook also includes an anno- tated bibliography for readers looking for additional information on particular topics. How was the research conducted? The scope of this ACRP research project was limited to those airports that serve locations that The research U.S. law defines as "small communities"--generally, those with airports classified by the FAA as small hubs and non-hubs. These communities tend to need greater assistance in obtaining or supporting this enhancing commercial air service. There are 426 non-hub and small hub communities in the Guidebook United States, including those in Alaska, Hawaii, and U.S. territories. Note that the FAA's defini- focused exclusively tions of hub airports are based on statutory definitions and are not the same as the more operational definition of hubs that are applied by airlines. Federal law defines hub types at 49 USC 47102. on those airports The study team began with an extensive literature review of topics related to air service devel- serving locations opment. (Major related articles are summarized in the annotated bibliography included in the that U.S. law appendix.) Critical among the materials reviewed were several reports written by the federal defines as "small government, particularly the U.S. Department of Transportation (U.S.DOT) and the U.S. Government Accountability Office (GAO), both of which have produced numerous documents communities." about air service at smaller communities. The study team also drew on its own expertise in air service development, which collectively amounted to several decades. The study team also reviewed material posted in the libraries of various industry trade groups, such as the American Association of Airport Executives (AAAE). As part of that review, the study team examined materials submitted to the U.S.DOT by smaller communities applying for grants from the Small Community Air Service Development Program (SCASDP). This federal program provides grants to small communities to help them achieve sustainable air service. Those submissions provided a rich source of descriptions of the fundamental air service problems that small communities confront and how they intended to address them. Based on that information, the study team created a categorization of ASD problems com- monly faced by small communities. These almost universally included relatively high airfares. However, the issue with the airfares is in part a reflection of the extent of competition at the air- port in particular markets, the type of competition present at the airport [i.e., network carriers versus low-cost carriers (LCCs)], the proximity of the airport to network carrier hubs or other larger airports served by a low-cost carrier, the airport's geographic isolation, and the economic strength of the community. The study team excluded airports in Alaska, Hawaii, and the territo- ries because of the fundamentally different and unique challenges those communities confront. The study team then added information on the different types of ASD techniques that vari- ous airports and communities have used over the last several years. These include various types

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20 Passenger Air Service Development Techniques of financial and non-financial incentives, such as revenue guarantees, cost subsidies, guaranteed ticket purchases, and marketing. The study team thus had a framework of information about fundamental air service problems and techniques used to address them at small community airports. The study team then designed a survey questionnaire to gather additional information from a number of those airports. Forty- one airports were selected to survey. This number was appropriate because it allowed the study team to interview both non-hub airports and small hub airports from around the country that face the full array of competitive challenges. It also allowed the study team to interview multiple airports that had implemented similar ASD approaches. Figure 1.1 shows the airports that were surveyed. The survey covered three basic topics: A profile of existing service at the airports, along with the airport directors' sense of what their major deficiencies were; A review of the ASD techniques that had been used; and The airport directors' evaluations of those techniques' effectiveness. The study team pre-tested its surveys with a small number of airports and made subsequent adjustments based on the outcomes. The study team also interviewed a number of air carriers to get their opinions on ASD prior- ities at smaller communities. The carriers included both network (United Airlines, Delta Air Lines, and Continental Airlines) and low-cost carriers (AirTran Airways and Frontier Airlines), along with a niche carrier (Allegiant Air). The study team also obtained information from American Eagle Airlines and ExpressJet Airlines. ALW DIK BTV FAR RDM RUT IDA GRR ITH AZO CAK IPT HVN YNG MDT STS RFD LNK HDN FAT COS BFL PAH TRI TYS PSP State of North Carolina LIT LAW HSV LBB ABY MOB TYR BTR PNS GNV DAB SRQ VCT Figure 1.1. U.S. airports surveyed.