Air Carrier Incentive Program

Denver International Airport 2024 Air Carrier Incentive Program

Goal: To increase nonstop scheduled air service and passenger traffic at Denver International Airport (DEN) and to sustain this service over the long term.

General Guidelines

• Promotional Benefits are offered to any eligible air carrier announcing scheduled nonstop passenger service to an eligible market between Jan. 1 – Dec. 31, 2024.
• Markets, both domestic and international, are considered served as soon as service is publicly announced and/or loaded into schedules, whichever occurs first.
• Carrier must begin service within 331 days of service announcement to be eligible for the incentive.
• Charter operations, including operators under Parts 121, 135 and 380, are not eligible.
• Markets that fall under the Essential Air Service (EAS) program are not eligible.
• All conditions for receiving the Promotional Benefits will be documented in a legal agreement between the City & County of Denver (City) and the eligible air carrier. This legal agreement is subject to final approval by the appropriate officials at the City.
• If the eligible air carrier does not meet the minimum service requirements, then all operational credits provided to the air carrier shall be refunded to the City, and all reimbursements to the air carrier for marketing activities shall be refunded to the City.
• Total incentive funds available are limited and may expire during this period.
• DEN Air Carrier Incentive Program is subject to change; any changes will be posted at least 30 days in advance of the implementation of such changes.

Eligible Air Carriers

1. A new air carrier (New Entrant Carrier) is eligible for Promotional Benefits.
2. A New Entrant is defined as an air carrier that has not operated any scheduled domestic or international passenger air service at DEN in the most recent 24 months.
3. An incumbent air carrier (Incumbent Carrier) is eligible for Promotional Benefits.
4. If the New Entrant Carrier can reasonably be considered a replacement for existing service, the air carrier is considered an Incumbent Carrier.
5. Immunized joint venture partner carriers will be considered as a single carrier for the purposes of determining net frequency/capacity changes.
6. A New Entrant Carrier is only eligible for one incentive type at a time.
7. An Incumbent Carrier is only eligible for one incentive per destination at a time.
8. An Incumbent Carrier cannot receive an incentive while still receiving a New Entrant Carrier incentive.

Eligible Domestic Markets

1. Domestic Markets are defined as any market in the 50 U.S. states, Puerto Rico and the U.S. Virgin Islands.
2. An Unserved Domestic Market is defined as any Domestic Market that has not had scheduled nonstop service from DEN in the most recent 24 months.
3. Unserved Domestic Markets in the Lower 48 U.S. states are eligible for Promotional Benefits.
4. If the Unserved Domestic Market in the Lower 48 U.S. states is operated by an Incumbent Carrier, service must be operated at a minimum of 5 days per week (annualized at 260 days per year).
5. If the Unserved Domestic Market in the Lower 48 U.S. states is operated by a New Entrant Carrier, service must be operated at a minimum of 2 days per week (annualized at 104 days per year).
6. Unserved Domestic Markets in Alaska, Hawaii, Puerto Rico and the U.S. Virgin Islands are eligible for Promotional Benefits by both New Entrant Carriers and Incumbent Carriers if service is operated at a minimum of 2 days per week (annualized at 104 days per year).
7. Served Domestic Markets in Alaska, Hawaii, Puerto Rico and the U.S. Virgin Islands are eligible for Promotional Benefits if the eligible air carrier’s new service results in a minimum of a 50% increase in frequency in service from DEN to the market without any corresponding reduction in capacity.
8. Served Domestic Markets in the Lower 48 U.S. states are only eligible for Promotional Benefits as part of a New Entrant Carrier incentive.

Eligible International Markets

1. International Markets are defined as any market that is not in the 50 U.S. states, Puerto Rico or the U.S. Virgin Islands.
2. An Unserved International Market is defined as any international market that has not had scheduled nonstop service from DEN in the most recent 12 months.
3. Unserved International Markets are eligible for Promotional Benefits.
4. Served International Markets are eligible for Promotional Benefits if the eligible air carrier’s new service results in a minimum of a 50% increase in frequency of service from DEN to the market without any corresponding reduction in capacity.
5. For the purposes of the table defining incentive levels, countries are assigned to regions based on the International Air Transport Association (IATA) definitions.
6. Mexico Leisure Destinations are defined as the following: Acapulco (ACA), Cancun (CUN), Cozumel (CZM), Huatulco (HUX), Ixtapa/Zihuatanejo (ZIH), Mazatlan (MZT), Puerto Escondido (PXM), Puerto Vallarta (PVR), San Jose del Cabo (SJD) and Tulum (TQO).

Promotional Benefits

The Promotional Benefits available include an Operational Incentive and a Marketing Incentive.  All Promotional Benefits are prorated on an annual basis.  The eligible air carrier can choose to take Promotional Benefits solely through the Operating Incentive, solely through the Marketing Incentive, or a combination of both the Operating Incentive and the Marketing Incentive.

1. Operational Incentive.
   1. Operational Incentives are administered through credits.
   2. Operational Incentives available to air carriers may include, but are not limited to, landing fees, rental fees and gate fees.
   3. The credits will not exceed the costs that would otherwise be charged by DEN to the air carrier associated with operating the eligible route.
   4. The credits for a frequency increase will not exceed the costs that would otherwise be charged by DEN to the air carrier associated with operating the increased frequencies.
2. Marketing Incentive.
   1. The air carrier will develop a marketing plan that must be approved by DEN.
   2. The marketing plan must promote public and industry awareness of the new service offered by the air carrier at DEN to must promote travel to/from/through DEN.
   3. The air carrier is responsible for executing the marketing plan, including making all payments to any third parties.
   4. Upon receipt of invoices from the air carrier, DEN will reimburse the air carrier for expenses related to the execution of the approved marketing plan.
   5. Air carrier is required to provide documentation the marketing services were provided and proof of payment by air carrier to third parties for DEN to provide reimbursement to the air carrier.
   6. An initial draft of the marketing plan must be submitted to DEN within 60 days of air carrier’s notification to DEN that the air carrier intends to take the Marketing Incentive. If the air carrier does not provide a draft marketing plan within this 60-day period, the City is not obligated to enter negotiations.

Promotional Period

The Promotional Period is defined as the first consecutive 12 or 24 months immediately following the initiation of eligible new service.

1. The 12-month Promotional Period applies to the following:
   1. New Entrant Carrier announcing nonstop service solely to an eligible market (or markets) that is already served nonstop from DEN.
   2. In the case of a New Entrant Carrier announcing service to both an eligible served market and an eligible unserved market at the same time, the eligible served market falls under the 12-month promotional period.
   3. Incumbent Carrier announcing nonstop service solely to an eligible market (or markets) that is already served nonstop from DEN (defined as a Frequency Increase).
   4. All Frequency Increase incentives.
2. The 24-month Promotional Period applies to the following:
3. 1. New Entrant Carrier announcing nonstop service solely to an eligible market (or markets) that is not served nonstop from DEN.
   2. In the case of a New Entrant Carrier announcing service to both an eligible served market and an eligible unserved market at the same time, the eligible unserved market falls under the 24-month promotional period.
   3. Incumbent Carrier announcing nonstop service solely to an eligible market (or markets) that is not served nonstop from DEN.

Frequency Increase Guidelines & Calculation

1. The Frequency Increase must be an increase of at least fifty percent (50%) over the immediately preceding 12-month period without any corresponding reduction in capacity.
2. The calculation of a Frequency Increase is required to fall under one of the following three 12-month periods:
   1. Calendar year
   2. One year beginning with the start of IATA Summer Season
   3. One year beginning with the start of IATA Winter Season
3. The previous annual frequency is calculated using all flight departures from DEN to the eligible market.
4. A sample Frequency Increase table is included below.

Minimum Service Period and Minimum Service Level

1. For service that qualifies for the 12-month Promotional Period, service must operate during the 12 consecutive months following service inauguration and must still be operating one year after service inauguration.
2. For service that qualifies for the 24-month Promotional Period, service must operate during the 24 consecutive months following service inauguration and must still be operating two years after service inauguration.
3. In cases where the Promotional Benefits are not based on a minimum Frequency Increase, air carrier may adjust the frequency of service during the Promotional Period; however, the air carrier shall not decrease the frequency of service to less than sixty-six percent (66%) of the initial amount of published service, the calculation of which will be averaged over the course of 12-month periods.
4. In cases where the Promotional Benefits are based on a minimum Frequency Increase, the only adjustments permitted are for irregular operations.

Primary Air Carrier

The Primary Air Carrier is defined as the marketing carrier for the eligible service.  The City will enter into legal agreements with only the Primary Air Carrier, except in cases which the Primary Air Carrier grants permission to the City to enter into a legal agreement with the operating carrier.

Notice of Intent

An air carrier must notify DEN within 60 days of air carrier’s public announcement of eligible service of the intention to enter into a legal agreement for Promotional Benefits with the City.  If the air carrier does not provide such notification within 60 days, the City is not obligated to enter negotiations.

Signed Agreement Requirement

An eligible air carrier must sign the legal agreement within 60 days of receipt from the City.  If the air carrier does not sign the legal agreement within 60 days, the City reserves the right to end negotiations.