Page 54 - Planning and Design of Airports

32 Airp o r t Pl anning

8. Authorized the CAB to order an airline to continue to pro-
vide “essential air transportation service” and, for a 10-year
period, to provide subsidies or seek other willing carriers to
ensure the continuation of essential service.
9. Required the CAB to determine within 1 year of the enact-
ment of the legislation what it considered to be “essential air
transportation service” for each point being serviced at the
time of enactment of the legislation.
10. Required the CAB and the Department of Transportation to
determine mechanism by which the state and local govern-
ments should share the cost of subsidies from the federal gov-
ernment to preserve small community air service and to make
policy recommendations to Congress on this matter.
11. Exempted from most CAB regulation commuter aircraft
weighing less than 18,000 lb and carrying fewer than
56 passengers.
12. Made commuter and intrastate air carriers eligible for the
federal loan guarantee program.
13. Provided that the domestic route authority of the board
would cease in 1981; its authority over domestic fares, acqui-
sitions, and mergers would cease in 1983; and the board
would be abolished (sunset) in 1985.
14. Provided that after the board was abolished, the local service
carrier subsidy program was to be transferred to the Depart-
ment of Transportation; the foreign air transportation author-
ity of the board was to be transferred to the Transportation
and Justice Departments, in consultation with the State
Department; and the mail subsidy program was to be trans-
ferred to the U.S. Postal Service.

Impact of Airline Deregulation
In the United States prior to 1978, air carriers applied to the Civil
Aeronautics Board (CAB) for permission to serve markets. The CAB
granted air carriers service to markets with a determined operating
and fare schedule. Upon deregulation, air carriers freely entered new
markets, increasing the number of markets served, increasing compe-
tition and lowering overall airfares. To maximize their market share in
the industry, several air carriers concentrated their route structures on
one or more “hub” airports. The early years of this hub and spoke
route system resulted in the greatest growth in commercial aviation in
its history. The beginning of the twenty-first century exposed many of
the weaknesses in the airline hub and spoke model, including the
increased costs of operating through congested hub airports, increas-
ing fuel and other operating expenses, combined with the ability for