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service, and conversely, why the other operators need subsidy if the San Francisco one can operate without it.
The answers are that we found a prospect for profitable operations then, but that this prospect thus far has not materialized. The San Francisco operation differs from that of the others. There are water barriers separating the principal bay areas involved, and, in authorizing the service, there were findings that surface transportation between various bay area points  were both time consuming and expensive.

The helicopter service not only cuts down on the travel time, but it can compete costwise with surface transportation. For example, the taxi fare from the airport to Berkeley is $13.50, whereas the helicopter fare to this point is $8.50.

In addition, the bay area operation involves short stage lengths and serves a compact area, thus permitting a much higher daily utilization of equipment. Despite these factors, the San Francisco operation was conducted at an operating loss of more than $100,000 for the calendar year ending November 30, 1964. 

The charge has been made that the lack of certification of helicopter service to still other cities constitutes favored treatment to the three communities receiving subsidized services.

The fact of the matter is that the cost of further expansion of the experiment in the past would have been prohibitive, and that it was necessary to limit the experiment to those cities in which we could expect the best operating results.
We hope that other cities will ultimately benefit from the experiment. Furthermore, while we also hope that the services of this type ultimately will meet the needs of local commuter traffic, thus far the operating results demonstrate that the services have been almost exclusively a part of the national transportation system. 

According to a survey made in 1963, over 52 percent of the passengers transported by the subsidized carriers were from outside the three areas involved and approximately 95 percent of all passengers were connecting with other air carriers. 

The Board agrees that helicopter subsidy should not continue indefinitely, and the question now presented is what steps should be taken by the Congress and the Board with respect to the future of the helicopter program. 

The Congress, of course, is free to enact whatever legislation it wishes on this point. However, unless the Congress changes the existing law, the Board must be guided by the present statutory provisions.

Under the existing statue the certificate of the helicopter carriers were issued after notice and hearings, and after findings that the service is required by the public convenience and necessity in accordance with the standards of section 401 applicable to licensing. 

Under the act these certificates can be suspended or modified only after notice and hearing, and only if the facts support findings that the suspension or modification is in the public convenience and necessity. Although the Board has wide discretion in exercising its licensing powers, it must nevertheless observe the standards laid down in the act.