[Federal Register Volume 67, Number 208 (Monday, October 28, 2002)]
[Notices]
[Pages 65826-65828]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 02-27381]


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DEPARTMENT OF TRANSPORTATION

Federal Aviation Administration

[Docket No. FAA-2001-9852]


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

AGENCY: Federal Aviation Administration, DOT.

ACTION: Notice of adopted lottery allocation procedures at LaGuardia 
Airport.

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

DATES: Effective upon publication.

FOR FURTHER INFORMATION CONTACT: 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.

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 (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.
``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. 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

[[Page 65827]]

planned 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, Sec.  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

[[Page 65828]]

slots 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.

    Issued on October 22, 2002, in Washington, DC.
James W. Whitlow,
Deputy Chief Counsel.
[FR Doc. 02-27381 Filed 10-25-02; 8:45 am]
BILLING CODE 4910-13-M