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operate pending disposition of its renewal application under the provisions of section 9(b) of the Administrative Procedure Act. The temporary certificate of Chicago Helicopter Airways expires on December 11, 1966, and that of New York Airways on May 16, 1967. 

These three carriers were initially certificated with the strong support of either the Post Office Department or the Department of Defense. As a matter of fact, the military told us at one time that the savings which they had realized from the experience of the scheduled operators justified the subsidy cost.

At this time, however, the Board believes that the principal benefit to be derived from the continuation of the present experiment is the promise which these operations hold out as a partial solution to the problem of transportation within large metropolitan areas, in terms of transportation between airports, between airports and city centers, and to suburban and outlying areas.
Due to the availability of the new equipment introduced in 1962, it now appears that there is a reasonable prospect that operations, such as are now being conducted in Los Angeles and New York, will ultimately be subsidy free. If this occurs, these pioneering operations will point the way to similar operations at other metropolitan centers throughout the Nation. 

Furthermore, as with any other type of operation, improvements in all phases of operations can be anticipated, in terms of aircraft, maintenance, passenger-generating techniques, and the like.

The continued presence of the existing carriers will afford a basis for continued experimentation and exploration of methods whereby more economical and effective operations can be conducted, with benefit to the entire Nation. 

In point of fact, we believe that the experiment already has borne fruit in terms of expansion of operations. The San Francisco-Oakland operations which recently were instituted had the benefit of the experience of the operations in the Los Angeles area, and, indeed, the top personnel involved in the San Francisco operations were former employees of Los Angeles Airways.

I would like to emphasize that the Board has endeavored at all times to keep the cost of the program down, and to limit subsidy support to that service necessary to meet the more pressing needs.

Consistently with this policy, the Board has restricted the eligibility for subsidy mail pay to the three carriers described. The areas served by these operators are sufficiently divergent in their characteristics to permit a complete experimental program. 

They possess a very high density of air traffic, and presently account for 25 percent of all domestic passengers enplaned at all U.S. airports. The recent grant of helicopter authority to San Francisco and Oakland Helicopter Airlines, and the recent denial of helicopter operations for service in the Washington area, are also consistent with the policy of keeping down subsidy costs.

Subsidy was not authorized with respect to the San Francisco operation, and no carrier proposing service in the Washington area was willing to accept a nonsubsidy certificate. 

The questions quite naturally arise of why, if subsidy support is required for operations, the Board certificated the San Francisco