[Federal Register Volume 66, Number 152 (Tuesday, August 7, 2001)]
[Notices]
[Pages 41294-41298]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-19703]


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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

[Docket No. FAA-2001-9852]


High Density Airports; Notice of Extension of the Lottery 
Allocation and Notice of Lottery for Limited Slot Exemptions at 
LaGuardia Airport

AGENCY: Federal Aviation Administration, DOT.

ACTION: Notice of lottery for takeoff and landing times at LaGuardia 
Airport.

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SUMMARY: This notice announces the Federal Aviation Administration 
(FAA) extension of the current allocation of exemption slots at 
LaGuardia Airport (LGA) as authorized under the Wendell H. Ford 
Aviation Investment and Reform Act for the 21st Century (``AIR-21''). 
Additionally, this notice announces a second lottery for a limited 
number of slot exemptions at LGA to allocate unused capacity under the 
agency imposed slot exemption limit, effective January 31, 2001. The 
FAA finds that this action maintains the current operating environment 
at LGA pending a long-term solution.

DATES: The lottery will be held on August 15, 2001.

ADDRESSES: The lottery will take place at 1:30 p.m., in the FAA 
Auditorium, 3rd floor, Federal Aviation Administration, 800 
Independence Avenue , SW., Washington, DC 20591.

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

SUPPLEMENTARY INFORMATION:

Background

    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, 
LaGuardia Aiport, O'Hare International Airport, Ronald Reagan 
Washington National Airport and Newark International Airport (33 FR 
17896; December 3, 1968). The regulation limits the number of 
instrument flight rule (IFR) operations at each airport, by hour or 
half hour, 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 landing takeoff or landing during a specific 30-
or-60 minute period. The restrictions were lifted at Newark in the 
early 1970s.

``AIR-21''

    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. Sec. 41714 and included new 
provisions codified at 49 U.S.C. Secs. 41716, 41717, and 41718. These 
provisions enabled air carriers meeting specified criteria to obtain 
new slot exemptions at New York's LaGuardia Airport (LaGuardia) and 
John F. Kennedy International Airport (JFK), Chicago's O'Hare 
International Airport (O'Hare) and Washington DC's Ronald Reagan 
Washington National Airport (National). As a result of this 
legislation, the Department of Transportation (Department) issued eight 
orders establishing procedures for the processing of various 
applications for exemptions authorized by the statute.
    Specifically, Order 2000-4-11 implements 49 U.S.C. 41716(a), which 
provides in pertinent part that an exemption must be granted to any 
airline using Stage 3 aircraft with less 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 Airport during the week of November 1, 1999; or (2) the 
proposed service between the small hub or nonhub 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.
    According to AIR-21 and the Department's Orders, air carriers 
meeting the statutory tests delineated above automatically receive 
blanket approval for slot exemptions, provided that they certify in 
accordance with 14 CFR 302.4(b) that they meet each and every one of 
the statutory criteria. The certification must state the communities 
and airport to be served, that the airport was designated a small hub 
or 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 planned effective dates. Carriers must also certify 
that the proposed service represents new

[[Page 41295]]

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 
slot exemptions and the times needed to provide the service.
    Order 2000-4-10 implements the provisions of 49 U.S.C. 41716(b), 
which states in pertinent part, that exemptions 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 slot exemptions 
granted under this subsection to such air carrier with respect to such 
airport when added to the slots and slot exemptions held by 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. 4715(b)(1) expressly provides that 
the provisions for slot exemptions are not to affect the FAA's 
authority for safety and the movement of air traffic. The reallocation 
of exemption 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 slot exemption 
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 Airport, especially during peak 
hours, even if those operations would otherwise qualify for exemptions 
under AIR-21.
    Lastly, section 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 herein and allows for special conditions to be 
included when circumstances warrant special consideration.

Notice of Proposed Extension of Lottery Allocation

    On June 7, 2001, the FAA issued a Notice of Alternative Policy 
Options for Managing Capacity at LGA and Proposed Extension of the 
Lottery Allocation seeking comment on both long-term policy options and 
a short-term extension of the cap on slot exemptions at LaGuardia (66 
FR 31731; June 12, 2001). The number of AIR-21 slot exemptions that may 
be operated at the airport was limited by the FAA to 159 operations 
effective January 31, 2001, and allocated in accordance with the slot 
lottery held on December 4, 2000. This allocation capped scheduled 
operations to 75 per hour between the hours of 7 a.m. and 9:59 p.m., 
which limited daily and hourly demand on airport facilities and the air 
traffic control system. The FAA has found that this number of flights 
can be accommodated in good weather conditions and at the same time, 
provides access for AIR-21 exemption flights. (This number does not 
include extra sections of scheduled air carrier flights or the 6 
reservations per hour for ``Other'' nonscheduled operations, including 
general aviation, charters and military flights. Therefore, this 
maintains total operations of approximately 81 per hour, which is the 
optimum capacity benchmark established for LaGuardia Airport.)
    The FAA also proposed to conduct a lottery for a limited amount of 
slot exemptions that are available for use and consistent with the 
overall cap on scheduled operations at the airport. The FAA proposed 
that first this unused capacity should provide access to LGA for 
carriers that previously were excluded or did not receive an allotment 
of four slot exemptions as a new entrant in the December 4 lottery and 
then be offered to carriers providing small community service. At the 
same time that this notice was issued, there were 14 exemption slots 
available for reallocation. Subsequent to that date, five additional 
slot exemptions have been returned to the FAA for a total of 19 slot 
exemptions available for reallocation by lottery.
    Specifically, the agency proposed that carriers eligible to 
participate in the lottery for these slot exemptions be initially 
limited to new entrant carriers that did not participate in the 
December 4 lottery or new entrant carriers that were unable to select 
up to four exemptions slots during the first round of the December 4 
lottery. Any slot exemption not selected by a new entrant in the first 
round would be offered to all eligible carriers providing small 
community service, again using the established rank order from the 
December 4 lottery.

Discussion of Comments

    The FAA provided for a 30-day comment period, which closed on July 
12, 2001. A total of 23 comments were filed in the docket. This notice 
does not address any comments filed regarding Phase 2. Comments on 
Phase 1 were submitted from nine airlines (Vanguard, Continental, 
America West, American Trans Air, Delta, USAirways, American, United 
and Spirit), four associations (the Air Carrier Association of America, 
the General Aviation Manufacturers Association, the National Air 
Carrier Association, Inc., and the Air Transport Association of 
America), the Airports Council International-North America, the Port 
Authority of New York and New Jersey, JBT3 Enterprises, the New York 
State Aviation Management Association, Newport News-Williamsburg 
International Airport, Congressman Gilman, and one individual.
    Certain comments addressing long-term solutions and elimination of 
the extra section provision, the buy-sell rule and the perimeter rule 
are beyond the scope of this notice and will be addressed in separate 
agency actions.
    Generally, most commenters support the proposed allocation 
extension and lottery of available capacity, and submitted additional 
considerations. America West opposed the extension of the lottery 
allocation but in the alternative offered some modifications to the 
lottery procedures. A summary of the comments and the FAA response are 
categorized as follows:

Extension of the Allocation Start Date

    The FAA proposed all operations allocated in this second lottery 
must commence by October 29, 2001. While recognizing the strong demand 
for the limited slots at LaGuardia, Vanguard and the Air Carrier 
Association of America (ACAA) commented that the new entrant carriers 
respectively need 120 and 180 additional days from the date of 
allocation to plan schedules, to sell new service and to ensure that 
gate and other facilities are available. While the FAA agrees that 
under current conditions at the airport, some new entrant carriers may 
require additional start-up time, we are concerned that 180 days is 
excessive given demand. The FAA believes that 120 days will provide new 
entrants with adequate time to start operations at the airport. 
Consequently, the FAA will require that all operations subject to this 
lottery must commence within 120 days from the date of the lottery or 
they will be withdrawn.

Extension of the Allocation Termination Date (October 26, 2002)

    Both American and United specifically commented that the proposed 
extension of the slot allocation date should be for an indefinite 
period of time rather than through October 26, 2002, as proposed. 
Continental supported the October 26, 2002, date or longer. American 
and United

[[Page 41296]]

commented that a longer-term solution is not likely to be in place by 
the proposed date and that the agency should not rush consideration of 
potential alternatives to the existing capacity allocation regime in 
order to meet this date. The FAA acknowledges that some of the longer-
term alternatives proposed in the Notice could not be implemented by 
October 26, 2002, and that an extension of the proposed date may be 
necessary. However, the agency remains committed to finding a long-term 
solution at LaGuardia and considers this an agency priority. Therefore, 
the FAA affirms the proposed date for the present time, and as the 
process for Phase 2 continues to develop, will revisit this allocation 
date as necessary. The FAA assures that the process set forth for 
considering the proposals in Phase 2 will include the necessary time 
for public input and full agency consideration.

Slot Exemptions Allocated by the Contingent Round (the ``Legend 
Airlines'' Allocation)

    The FAA proposed the retention of the seven slots allocated by the 
contingency round to carriers providing service to small communities. 
ACAA comments that these seven slot exemptions should be included in 
round 1 of this lottery for new entrants and that the FAA's rationale 
that ``withdrawal of these exemption slots would cause further 
disruption'' is merely a convenient agency excuse. The FAA notes that 
in the December 4 lottery, these seven slots were not ``tagged'' for 
new entrant service. It is significant that all new entrant carriers 
received the same number of slot exemptions that they were actually 
operating prior to the December 4 lottery; no new entrant carrier was 
forced to cancel existing service. Because Legend ceased scheduled 
operations on the weekend preceeding the lottery, the FAA conducted a 
contingency round that would reallocate the slots in accordance with 
the established procedures in the event that Legend would not resume 
regular operations. Consequently, the slots were reallocated to 
carriers providing small community service since the new entrant 
carriers had received all the slot exemptions that they could receive 
under the established lottery procedures while overall service to small 
communities was reduced. The FAA does find minimizing of service 
disruption to be a compelling and legitimate interest that must be 
taken into consideration while accommodating other public interest 
policies. Additionally, the FAA believes that retaining this 
allocation, in conjunction with the following lottery procedures 
adopted herein, provided equitable treatment between the two categories 
of operations addressed by AIR-21. The FAA is following the intent of 
AIR-21 to the maximum extent practicable.

New Entrant Service Versus Small Community Service

    The majority of the comments concerned the number of slot 
exemptions that would be available during the lottery for new entrant 
service and small community service. USAirways states that the 
available slot exemptions should go to carriers that had to cancel 
service as a result of the administrative cap as opposed to allocating 
the slots to new entrants. Delta comments that the FAA should avoid 
service disruptions and that the agency should continue to monitor 
system performance at LaGuardia to determine whether to increase the 
hourly caps during this interim period. Delta further comments that any 
allocation of additional slot exemptions that become available due to 
increases in hourly caps should be made consistent with the objectives 
of AIR-21. Continental supports the additional allocation of unused 
capacity as proposed.
    The carriers conducting small community service support either the 
lottery procedures as proposed or that all the slot exemptions should 
go to these carriers for the restoration of canceled service prior to 
any allocation to new entrants. Also, the carriers and supporters of 
new entrant service argued just the opposite. Both America West and 
ACAA agree with the proposed round 1 for new entrants at the airport. 
However, for subsequent rounds, ACAA and America West argue that only 
after all new entrants and limited incumbents have the opportunity for 
a total of 20 slots and slot exemptions, as set forth in AIR-21, should 
any slot exemptions be made available for small community service. 
These commenters also argued that the established carriers hold a 
significant majority of HDR slots at LaGuardia and that small community 
service may be preserved by using existing slots and not at the expense 
of limiting access by new entrant carriers that do not have an 
established slot base at the airport. American Trans Air comments that 
round 1 should be expanded to include a broader class of new entrant 
carriers to select additional slot exmeptions. American Trans Air 
further comments that FAA has consistently used broad groupings when 
allocating slots and that the procompetitive accomplishments at 
LaGuardia of new entrant carriers provide compelling public policy 
reasons to again broadly treat the class of new entrant carriers 
eligible to participate in the lottery.
    AIR-21 provides access to the airport for both categories of 
operations (new entrants and small community service) during the phase-
out of the HDR. Opportunity for small community service was not to be 
sacrificed by new entrant service nor vice versa. AIR-21 provided that 
carriers providing new entrant service may receive slot exemptions up 
to the point that the carrier had 20 slots and slot exemptions. AIR-21 
also provided that carriers conducting small community service are not 
capped on the number of slot exemptions. As stated in the notice, the 
FAA finds it imperative to accommodate, albeit on a limited basis, new 
entrant carriers that could not participate in the December 4 lottery 
or that were unable to select up to four slot exemptions during that 
lottery. Even though this lottery allocation continues to represent a 
short-term solution to the complex issues at LaGuardia, the agency 
seeks to provide new entrants access to the airport. Ideally, the FAA 
would like to accommodate all new entrants and limited incumbent 
carriers that have not reached the 20 slots and slot exemptions maximum 
as contemplated by AIR-21, and also not limit carriers providing small 
community service. However, since the constraints at LaGuardia require 
a limit on all operations, the FAA finds it necessary to accommodate 
all these interests within the operational limits of the airport.
    The FAA believes that the lottery procedures proposed for round 1 
(new entrants or carriers that did not hold up to four slots and slot 
exemptions at the airport) and round 2 (small community service) should 
be adopted as proposed. The FAA continues to believe that round two 
should be reserved for small community service because it equitably 
treats the two categories of operations, consistent with statutory 
direction, and that these carriers were the only carriers that had to 
reduce or cancel service after the December 4 lottery. The FAA believes 
that service disruption to small communities is as critical a factor in 
public policy considerations as initiating and preserving new entrant 
service. However, if there are any remaining slot exemptions after 
round 2, the FAA believes that establishing procedures for a potential 
round 3 is also necessary to encourage balance between the two 
categories of service. Therefore, any slot exemption not selected by 
carriers providing small

[[Page 41297]]

community service in round 2 will be made available to any carrier that 
does not have 20 slots and slot exemptions at the airport, which also 
addresses certain comments requesting additional opportunities for 
limited incumbent carriers. Consequently, the FAA will conduct a third 
round for those carriers for any slot exemptions that remain.

Variation of the Lottery Procedures

    Several commenters suggested variations to the proposed lottery 
procedures. USAirways comments that it supports using the December 4, 
2000, rank order for round 2 providing that the rank order resumes 
where it left off, which is that USAirways gets the first selection due 
to the fact that it only was able to select one slot during the 
contingency round. The FAA agrees that following the procedures for the 
December 4 lottery and the established rank order confers the first 
selection in round 2 with USAirways.
    American West and ACAA both comment that new entrants in round 1 
should be able to select up to six slots in order to provide 
competitive service with three round trips. The FAA finds that 
providing new entrants with the ability to select four slots in the 
first round is consistent with the procedures used during the December 
4 lottery and with regulatory provisions articulated for slot lotteries 
under the High Density Rule. In this particular situation at LaGuardia, 
it is necessary to accommodate both categories of operations to the 
greatest extent possible given the operating limitations at the 
airport. Allowing new entrants to select up to six slots in round 1 
reduces the number of slots that would be available for small community 
service and would unfairly treat new entrant carriers in this lottery 
compared to new entrant carriers from the first lottery that were only 
above to select up to four slot exemptions in the first round. However, 
the establishment of a round 3 provision, in which all carriers that 
have less than 20 slots and slot exemptions may participate, places all 
new entrants and limited incumbents at the airport on equal footing for 
some type of modest growth within the cap on operations. Thus, under 
the third round new entrants and limited incumbents that have less than 
20 slots and slot exemptions have potential to select additional slots 
exemptions.
    ACAA further suggests that the FAA should amend the definition of a 
new entrant from 20 slots and slot exemptions to 30 slots and slot 
exemptions. Section 41714(h)(5) of Title 49 of the U.S.C. sets forth 
the definition of a limited incumbent carrier to be a carrier that 
holds less than 20 slots and slot exemptions. Also, Sec. 41716(b) 
authorizes that new entrants and limited incumbents may receive slot 
exemptions under this section so as to not exceed 20 slots or slot 
exemptions per carrier. Even if the FAA agreed with ACAA's comment, the 
above statutory provisions would not authorize ten additional slot 
exemptions for new entrant or limited incumbent carriers. ACAA further 
comments that new entrants should be able to select one slot exemption 
in each 30 minute period without regard to whether a slot is available. 
ACAA's suggestion is tantamount to permitting a carrier to pick two 
slots in one hour regardless of whether the slot times are available. 
The adopted procedures accommodate new entrants by letting them choose 
an hour for each operation and the agency has placed limitations on the 
number of slot exemptions that can be selected in the 1700 and 1800 
hours. It would be entirely contrary to the purpose of the agency's 
implementation of the 159 slot exemption cap (75 scheduled operations 
per hour) to permit historically congested hours to become even more 
oversubscribed since the purpose of the administrative cap is to 
balance demand with capacity. The FAA finds that in the interest of 
maintaining the current operating environment, it disagrees with this 
comment. Lastly, ACAA urges the agency to implement a ``fast track'' 
second Phase 1, which it describes as a process to adopt competition in 
the interim. According to ACAA, this ``fast track'' would entail a 
comprehensive review of all slot regulations that impact competition, 
including buy-sell, the extra section authority and slot reallocation. 
The FAA is committed to finding a workable long-term solution at 
LaGuardia that responds to all concerns. The elements described in the 
``fast track'' are elements that appropriately would be considered in 
Phase 2.
    American Trans Air suggests that the following limitations also 
apply to the class of eligible participants and round 1: (1) A 
participant must have participated in last December's lottery; (2) a 
participant must not have returned or had to surrender for insufficient 
use any LaGuardia slots; and (3) a participant must appear in the 
Department's latest Fare Survey as the lowest average fare carrier in 
at least one LaGuardia market. American Trans Air argues on the one 
hand that the category of eligible participants in round 1 be broadened 
to include carriers such as itself that received four or more slots in 
the December 4 lottery. In support of this argument, American Trans Air 
states that the agency typically uses broad carrier groupings when 
allocating slots and cites specific examples. However, on the other 
hand, American Trans Air then seeks to limit eligibility for this round 
with the above criteria. While the FAA does in fact count returned or 
unused slots and slot exemptions in determining each carrier's slot 
(and slot exemption) base, the FAA does not agree that further 
limitations as suggested above are justified in determining eligibility 
to participate in round 1. The above suggested limits would unduly 
favor the inclusion of a very discrete number of carriers for round 1.

Other Comments

    Spirit Airlines suggested that the FAA provide carriers with some 
mechanism to ``prioritize'' their flights, and provide them with a 
means to identify and ``protect'' some small number of flights which 
are most sensitive to delays. While this comment is beyond the lottery 
extension and reallocation issues proposed, the FAA notes this comment 
and will also forward this comments for inclusion in the discussion of 
Phase 2.
    The General Aviation Manufactures Associates (GAMA) commented that 
if any slots are unused for any reasons, the FAA should immediately 
allocate then to non-scheduled operations, even if only for a temporary 
basis. Under the High Density Rule (HDR), the ``Other'' category 
provides for six reservations per hour. While the HDR permits 
unallocated HDR slots to be made available under the ``Other'' category 
(14 CFR Section 93.123(b)(6)), AIR-21 does not provide such authority.

Procedure for Returned Slot Exemptions or Slot Exemptions Withdrawn 
for Non-Use

    The FAA is also amending the proposed procedures for returned slot 
exemptions and slot exemptions withdrawn for non-use. The FAA proposed 
to reallocate slot exemptions that become available during the 
allocation period using the established rank orders. While there were 
not comments specific to this proposal, the agency has reconsidered 
this process in view of the general nature of the comments submitted. 
The FAA does not want to limit any carrier from commencing operations 
at the airport for the duration of the lottery allocation to the extent 
that there is some available capacity after the date of this lottery. 
Consequently, any slot exemptions that are returned to the agency or 
are withdrawn for non-use will be made available on a first-come, 
first-serve basis to any carrier that does not operate

[[Page 41298]]

at the airport, has certified accordingly with the Department, and has 
a written request on file with the FAA Slot Administration Office.
    If the available slot exemptions are not selected by a new entrant 
carrier meeting the above criteria, the slot exemptions will be 
available to all carriers for selection in accordance with the 
appropriate established rank order, i.e., the December 4, rank order 
for carriers providing small community service and the August 15 rank 
order for all carriers that have less than 20 slots and slot 
exemptions. The slot exemptions will be selected by alternating between 
the two rank orders with the next carrier in line for selection from 
the December 4 rank order to select the first two available slot 
exemptions. The FAA believes that alternating selections between the 
two established rank orders will provide equitable treatment and 
opportunity to both categories of operations to obtain any available 
capacity throughout this allocation period.

Lottery Procedures

    Definitions for the terms ``carriers,'' ``new entrant,'' and 
``limited incumbent'' for purposes of participation in the lottery, are 
proposed as set forth in 14 CFR 93.213, and amended by Sec. 231 of AIR-
21. The FAA has applied the ``commuter affiliate'' provision in 49 
U.S.C. 41714(k).
    The January 31, 2001, allocation of slot exemptions at LaGuardia 
Airport is extended through October 26, 2002. The following 19 slot 
exemptions are available for reallocation by lottery: 7:00 (2), 8:00 
(1), 9:00 (1), 12:00 (1), 13:00 (1) 14:00 (1) 17:00 (1), 18:00 (1), 
21:00 (10). There is one exemption slot available in each the 17:00 and 
18:00 hour. After the selection of those times, the 17:00 and 18:00 
hours will be blocked from an additional selection since those two time 
periods are oversubscribed. The above slot exemptions will be allocated 
by lottery using the following procedures:
    1. New entrant carriers eligible to participate in this lottery are 
carriers that did not participate in the December 4 lottery or carriers 
that selected less than four exemption slots during the first round of 
the December 4 lottery and must have certified to the Department of 
Transportation in accordance with the procedures articulated in OST 
Order 2000-4-10 by August 9, 2001.
    2. New entrant carriers intending to participate must notify the 
FAA Slot Administration Office in writing by August 9, 2001 of their 
intent to participate in the lottery.
    3. New entrant carriers and carriers that hold less than 20 slots 
and slot exemptions at LaGuardia will participate in a random drawing 
from establishing a selection rank order. Carriers eligible to 
participate in rounds 1 and 3 described herein will select in that 
order. Each carriers must make its selection within 5 minutes after 
being called or it shall lose its turn.
    4. In the first round, new entrant carriers may select no more than 
four exemption times. Carriers that hold less than four slot exemptions 
may select exemption times so as to not exceed holding a total of four. 
Each new entrant carrier may select one slot exemption time in each 
hour without regard to whether a slot is available in that hour. The 
first round will be concluded when all participating new entrant 
carriers have reached their maximum allocation or choose not to select 
remaining available times.
    5. After the first round is completed, any remaining slot 
exemptions will be available to carriers providing service to small hub 
or non-hub airports in accordance with the established rank order from 
the December 4, 2000, lottery. Each carrier may select up to two slot 
exemptions and must make its selection within 5 minutes after being 
called or shall lose its turn. The second round will be concluded when 
all carriers have selected their maximum for that round.
    6. After the second round is completed, any remaining slot 
exemptions will be available to carriers that have less than 20 slots 
and slot exemptions using the established rank order described in 
paragraph 3 above.
    7. Slot exemptions selected in rounds 2 and 3 may only be operated 
in the available times.
    8. The FAA may approve the transfer of slot exemption 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.
    9. The Chief Counsel will be the final decisionmaker concerning 
eligibility of carriers to participate in the lottery.
    10. The slot exemptions reallocated by lottery will remain in 
effect through October 26, 2002.
    11. All operations allocated under these lottery procedures must 
commence by December 13, 2001. Carriers receiving slot exemptions under 
this lottery may commence operations earlier than September 15, 2001, 
if so desired.
    12. Carriers that participate and select exemption slots during the 
lottery must recertify to the Department of Transportation in 
accordance with the procedures articulated in OST Orders 2000-4-10 and 
2000-4-11 prior to operations, and provide the Department and the FAA 
with the markets to be served, the number of exemption slots, the 
frequency, and the time of operation.
    13. After the date of the lottery, if slot exemptions are turned-in 
to the FAA or are withdrawn for non-use, the FAA will make the slot 
exemptions available on a first-come, first-serve basis to a carrier 
that is not operating at LaGuardia as of August 15, 2001, certified to 
the Department in accordance with the procedures articulated in OST 
Order 2000-4-10, and has a written request on file with the FAA Slot 
Administration Office. Any carrier that meets the above criteria may 
select up to four available slot exemptions. Any slot exemptions not 
selected by the above described carriers will be available to all 
carriers for selection in accordance with the appropriate established 
rank order (the December 4 rank order for carriers providing small 
community service and the August 15 rank order for carriers with less 
than 20 slots and slot exemptions). Selections will alternate between 
the two rank orders, beginning with the next carrier in line from the 
December 4 rank order to select the first two available slot 
exemptions.

    Issued on August 2, 2001 in Washington, DC.
James W. Whitlow,
Deputy Chief Counsel
[FR Doc. 01-19703 Filed 8-2-01; 3:27 pm]
BILLING CODE 4910-13-M