It’s that time of year here in Washington, D.C. — budget time. This is the time of year when Congress begins jockeying for position to put in their favorite pet projects into the fiscal year 2012 budget. It’s also the time our legislature fulfills those promises to the folks back home to put the brakes on federal spending.
One of those many programs that always gets the spotlight this time of year is the Essential Air Service program. EAS was created after the airline deregulation bill became law back in 1978 as a way to ensure that small communities would not lose their connection to the global aviation transportation system. It was felt that in a post-deregulation world, these communities would lose service as the airlines focused on more profitable routes, so Congress would subsidize these routes. You can see the original list of cities included in EAS here.
Throughout the years, the program has seen cities and subsidies cut, but there’s been no real changes to the program since it was implemented back in 1978. I have had a unique view of the program: as a journalist who covered the regional airline industry for almost 10 years and as an employee of an airline that pursued EAS funding.
Looking at it from both sides, I’d say this program is long overdue for a makeover. The program is broken and most people know it. But whenever a call goes out to redo the program — or even cut it altogether — members of the House of Representatives and the Senate come out of the woodwork to keep the program in place, even though it makes no sense financially. Take a look at all the EAS stories — and congressional representatives defending it — I found with a simple Google search just in the past week.
Back in July 2009, the Government Accountability Office stated the obvious in a report that looked at EAS. “The EAS program has changed relatively little in 30 years, but current conditions raise concerns about whether the program can continue to operate as it has,” GAO wrote.
There are several problems. One, people just aren’t using the service, because even with the subsidies, the flights can be too expensive. Most people in EAS communities do what those without the service do — find other transportation to a larger airport with better service options.
I saw both sides of this coin up close and personal when I worked for the airline. Our team was bidding on EAS service in Nebraska and we flew from Denver to Nebraska on the carrier that had the contract we wanted. We were the only passengers on the flight. I asked the crew if this was normal, and they said it was pretty much the norm. When we went to Alamogordo, N.M., to bid on the service, we flew into El Paso, rented a car and drove the 80 miles to the city.
Two, the number of airlines offering EAS has dropped drastically, from from 34 in 1987 to 10 in 2009, according to GAO. Airline costs have risen and the fuel price spike of a few years ago made EAS flying unprofitable, so more dropped out of the program.
Three, the airlines face reliability and destination issues. Regularly scheduled services usually take priority over EAS flights. And the EAS flights don’t always go to the hub that travelers want most. Look at the service offered in Arizona by Great Lakes. Kingman flights go to Las Vegas; Page and Show Low flights go to Phoenix; and Prescott flights go to LA Ontario, then Denver.
Subsidies have steadily increased, from a steady $50 million a year in the 1990s to a budget request of $200 million in FY 2012. I think 2011 should be the year that Congress swallows hard and takes a hard look at EAS to make it into the program originally envisioned — essential air service — back in 1978.