Boutique Air, town of Massena officials meet to discuss airline's plan to rebid contract

Sep. 27—MASSENA — Boutique Air officials say they plan to continue serving Massena International Airport until the end of March, although they have asked the U.S. Department of Transportation to rebid the Essential Air Service contract before then.

Boutique Air officials announced earlier this month that they wanted to terminate their Essential Air Service contract with the town of Massena so they can rebid at a higher rate. They met with town officials Monday to discuss their plans.

"It was a very positive and helpful meeting to come to a mutual understanding on the reason we put in notice to speed up the contract renewal process. We are most definitely going to rebid the Massena contract once the DOT sends out the request to rebid," said Brian Kondrad, Boutique Air vice president of business operations.

The U.S. Department of Transportation had announced in March 2021 that Boutique Air had officially been named the Essential Air Service provider at Massena International Airport. The two-year contract runs from April 1, 2021, to March 31, 2023, at a first-year annual subsidy rate of $3,411,097 and a second-year annual subsidy rate of $3,479,318.

The DOT had initially selected Boutique Air to provide EAS service in Massena from April 1, 2019, through March 31, providing 21 nonstop round trips per week to Boston Logan International Airport for a first-year annual subsidy of $3,074,254 and a second-year annual subsidy of $3,166,481.

An order issued on Dec. 18, 2020, announced the approval of Boutique Air, with the concurrence of the community, to operate up to seven of the 21 weekly round trips to Baltimore/Washington International Thurgood Marshall Airport in lieu of service to Boston. There was no change in the annual subsidy or contract end date.

Boutique Air was one of three airlines submitting proposals to provide Essential Air Service at Massena International Airport. Also submitting bids were Cape Air and Southern Airways Express LLC. Cape Air had served the town for eight years prior to Boutique Air winning the contract.

Now, Boutique Air officials say the cost of doing business has increased dramatically.

"Due to the previous contract reflecting costs from 2019, the current subsidy provided by the DOT does not reflect the current economic conditions of today. This was the sole reason for the cancellation of the current contract and to begin the rebidding process for a more economically adequate subsidy rate," Mr. Kondrad said. "The airport also agrees that today's economy is not the same as it was a few years ago. The Massena airport has incurred their own rise in operational costs."

In the company's notice of termination of service, CEO Shawn Simpson noted that they were giving 90 days' notice to terminate their current EAS contract "with the intention to rebid at a subsidy that will support ongoing operations."

Mr. Simpson wrote, "Although Boutique Air, Inc., would prefer to continue providing scheduled air service at the awarded subsidy, cost increases in the areas of staff, fuel, parts, and services induced by the coronavirus pandemic now hinder Boutique Air's ability to operate under the original budget."

In addition to requesting proposals from air carriers to provide replacement Essential Air Service in Massena, the Department of Transportation will also issue an order prohibiting Boutique Air from terminating its air service in Massena. They will be required to continue providing EAS at Massena until a new carrier begins full EAS in the community.

"Our flights are currently available until the end of March and will continue to start at $59," Mr. Kondrad said. "Massena is just as important to us as we are to the community and region. Massena is now the only airport in the north country region to have service to Boston and Baltimore/D.C. area. This year we have maintained a 99 to 100% completion rate and we look forward to providing excellent service for years to come."