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High Density Airports; Notice of Adopted Lottery Allocation Procedures for Slot Exemptions at LaGuardia Airport

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Federal Aviation Administration, DOT.


Notice of adopted lottery allocation procedures at LaGuardia Airport.


This notice announces the adoption of proposed modifications to the lottery procedures for reallocation of available exemption slots at LaGuardia Airport.


Effective upon publication.

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Lorelei D. Peter, Traffic and Operations Law Branch, Regulations Division, Office of the Chief Counsel, Federal Aviation Administration, 800 Independence Avenue, SW., Washington, DC 20591; telephone number 202-267-3073.

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The FAA has broad authority under Title 49 of the United States Code (U.S.C.), Subtitle VII, to regulate and control the use of the navigable airspace of the United States. Under 49 U.S.C. 40103, the agency is authorized to develop plans for and to formulate policy with respect to the use of navigable airspace and to assign by rule, regulation, or order the use of navigable airspace under such terms, conditions, and limitations as many be deemed necessary in order to ensure the safety of aircraft and the efficient utilization of the navigable airspace. Also, under section 40103, the agency is further authorized and directed to prescribe air traffic rules and regulations governing the efficient utilization of the navigable airspace. The High Density Traffic Airports Rule, or “High Density Rule,” 14 CFR part 93, subpart K, was promulgated in 1968 to reduce delays at five congested airports: John F. Kennedy International Airport (JFK), LaGuardia, O'Hare International Airport (O'Hare), Ronald Reagan Washington National Airport (Reagan National) and Newark International Airport (Newark) (33 FR 17896; December 3, 1968). The regulation limits the number of instrument flight rule (IFR) operations at each airport, during certain hours of the day. It provides for the allocation to carriers of operational authority, in the form of a “slot” for each IFR takeoff or landing during a specific 30- or 60-minute period. The restrictions at Newark were lifted in the early 1970s.


On April 5, 2000, the “Wendell H. Ford Aviation Investment and Reform Act for the 21st Century” (“AIR-21”) was enacted. Section 231 of AIR-21 significantly amended 49 U.S.C. 41714 to phase out slots at LaGuardia, JFK, and O'Hare. Section 41715 terminates slots at O'Hare as of July 1, 2002, and at LaGuardia and JFK on January 1, 2007. Section 231 also included new provisions codified at 40 U.S.C. 41716, 41717, and 41718 that enable air carriers meeting specified criteria to obtain exemptions (referred to as “exemption slots”) from the requirements of subparts K and S of part 93 of Title 14 of the Code of Federal Regulations at LaGuardia, JFK, O'Hare, and Reagan National. As a result of this legislation, the Department of Transportation (Department) issued eight orders establishing procedures for the processing of various applications for exemption slots authorized by the statute. Specifically, Order 2000-4-11 implements 49 U.S.C. 41716(a), which provides that an exemption slot must be granted to any airline using Stage 3 aircraft with fewer than 71 seats that proposes to provide nonstop service between LaGuardia and an airport that was designated as a small hub or nonhub airport in 1997, under certain conditions. The exemption must be granted if: (1) The airline was not providing such nonstop service between the small hub or nonhub airport and LaGuardia during the week of November 1, 1999; (2) the proposed service between the small hub or nonhub airports and LaGuardia exceeds the number of flights provided between such airports during the week of November 1, 1999; or (3) if the air transportation pursuant to the exemption would be provided with a regional jet as replacement of turboprop service that was being provided during the week of November 1, 1999.

Under AIR-21 and the Department's Orders, air carriers meeting the statutory tests delineated above automatically receive blanket approval for exemption slots, provided that they certify in accordance with 14 CFR 302.4(b) that they meet each of the statutory criteria. The certification must state the communities and airport to be served, that the airport was designated a small hub and nonhub airport as of 1997, that the aircraft used to provide the service have fewer than 71 seats, that the aircraft are Stage 3 compliant, and the Start Printed Page 65827planned effective dates. Carriers must also certify that the proposed service represents new service, additional frequencies, or regional jet service that has been upgraded from turboprop service when compared to service for the week of November 1, 1999. In addition, carriers must state the number of exemption slots and the times needed to provide the service. Order 2000-4-10 implements the provisions of 49 U.S.C. 41716(b), which states that exemption slots must be granted to any new entrant or limited incumbent airline using Stage 3 aircraft that proposes “to provide air transportation to or from LaGuardia or John F. Kennedy International Airport if the number of exemption slots granted under this subsection to such air carrier with respect to such airport does not exceed 20.” Applications submitted under this provision must identify the airports to be served and the time requested.

Section 231 of AIR-21, 49 U.S.C. 41715(b)(1), expressly provides that the provisions for exemption slots are not to affect the FAA's authority over safety and the movement of air traffic. The reallocation of exemption slot times by the lottery procedures described in this Notice is based on the FAA's statutory authority and does not rescind the exemptions issued by the Department under Orders 2000-4-10 and 2000-4-11. As provided in those orders, carriers that have filed the exemption certifications also need to obtain an allocation of exemption slot times from the FAA. The limiting and reallocation of these exemption slots is in recognition that it is not possible to add an unlimited number of new operations at LaGuardia, especially during peak hours, even if those operations would otherwise qualify for exemptions under AIR-21.

Lastly, § 93.225 of Title 14 of the Code of Federal Regulations sets forth the process for slot lotteries under the High Density Rule. The process described in the regulations is similar to the process described here and allows for special conditions to be included when circumstances warrant special consideration.

Extension of the Exemption Slot Allocation and Proposed Modifications to the Lottery Procedures

By notice published in the Federal Register, the FAA extended the allocation of the exemption slots for an additional two years. This extension, which will expire on October 31, 2004, allows for additional time to address a longer-term solution for LaGuardia Airport. Additionally, modifications to the allocation procedures were proposed for comment. One comment was received from America West Airlines. Several commenters filed comments discussing the long-term demand-management proposals in this docket as well as Docket FAA-2001-9854. Due to the nature of these comments, they will not be addressed in this Notice.

America West reiterates its argument in its comments to Phase II (policy alternatives for demand management) to abolish or modify the perimeter rule for LaGuardia Airport to enable it to operate non-stop service between LaGuardia and its principal hubs of Phoenix and Las Vegas. America West contends that the perimeter rule is anti-competitive and contributes to congestion. America West further argues that eliminating or modifying the perimeter rule can be made without determining the broader issues associated with demand management at LaGuardia and that there is no reason to delay action on this issue. America West also argues that since the incumbent carriers hold such a large percentage of the slots allocated under the High Density Rule (HDR), new entrants carriers should receive all requested exemption slots up to the statutory limit of 20, before any additional exemption slots are allocated to small hub, non-hub service by the large incumbent carriers.

In this notice, only comments concerning the proposed allocation procedures will be addressed. AIR-21 sought to provide additional access to LaGuardia for two distinct categories of operations as part of a phase-out of the HDR. AIR-21 did not seek to rectify any imbalance among competing slot holders of HDR slots. Instead, AIR-21 treats the categories equitably. As the FAA has stated in previous notices, for the interim period, the agency's stated policy of maintaining the goals and purposes of AIR-21 requires that allocation procedures are consistent with the policies of AIR-21. Therefore, the FAA adopts the lottery procedures as proposed and set forth below.

Adopted Lottery Procedures

1. The cap on AIR-21 exemption slots (7 a.m. through 9:59 a.m.) will remain in effect through October 30, 2004.

2. The FAA may approve the transfer of exemption slot times between carriers only on a temporary one-for-one basis for the purpose of conducting the operation in a different time period. Carriers must certify to the FAA that no other consideration is involved in the transfer.

3. Phase I: If any exemption slots are returned to the FAA or are withdrawn for non-use, the FAA would make the first four exemption slots available on a first-come, first-serve basis to a carrier that was not operating at LaGuardia as of August 15, 2001, that has certified to the Department in accordance with the procedures articulated in OST Order 200-4-10, and has a written request on file with the Slot Administration Office. Any of the first four returned or withdrawn exemption slots that are not selected by such a carrier would be available to the carriers that have less than 20 slots and exemptions slots at LaGuardia for selection in accordance with the August 15 established rank order, with each carrier able to select two exemption slots. Any exemption slots not selected during this process then would be made available to the carriers providing small hub/non-hub service using the December 4 rank order. This concludes Phase I.

4. Phase II: If any subsequent exemption slots become available for reallocation and there is an eligible carrier not conducting service at the airport seeking exemption slots, then the available exemption slots would be offered to that carrier first, provided that the total number of exemption slots allocated to carriers providing small hub/non-hub service is not below 76. If a new, eligible carrier does not select the exemption slots, then they would be offered to the category of carriers that is below parity, up to the level of re-establishing parity (using respective rank order). If the exemption slots are not selected or there are available exemption slots remaining, then they would be offered to carriers in the same category from which the exemption slots came. Any remaining exemptions not selected would be offered to the other category of carriers, using its respective rank order.

5. A carrier would have three business days after an offer from the Slot Administration Office to accept the offered exemption slot time. Acceptance must be in writing to the Slot Administration Office. If the Slot Administration Office does not receive an acceptance to an office within three business days, the carrier would be recorded as rejecting the offer and the next carrier on the list would be offered the available exemption slot times.

6. Carriers that are offered exemption slot times by the Slot Administration Office must re-certify to the Department of Transportation in accordance with the procedures articulated in OST Orders 200-4-10 and 2000-4-11 prior to operation and provide the Department and the FAA with the markets to be served, the number of exemption slots, the frequency, and the time of operations, before the exemption Start Printed Page 65828slots times will be allocated by the FAA to the carrier.

7. All operations allocated under these procedures must commence within 120 days of a carrier's acceptance of an available exemption slot.

8. The Chief Counsel will be the final decision maker concerning eligibility of carriers to participate in the allocation process.

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Issued on October 22, 2002, in Washington, DC.

James W. Whitlow,

Deputy Chief Counsel.

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[FR Doc. 02-27381 Filed 10-25-02; 8:45 am]