The American Samoa Government has declined a proposal from Polynesian Airlines for a subsidy as a condition for the airline to fly to Ofu island in Manu'a.
The Port Director Taimalelagi Dr Claire Poumele had requested earlier this year for Polynesian Airlines to operate flights to Ofu which has not had air service for many years.
She says Polynesian submitted a proposal which included a subsidy that would guarantee the government pay ten seats on each flight.
Taimalelagi says the proposal was too costly for the government but she's hopeful that they can reach an agreement that would be affordable and beneficial for both parties.
The Polynesian CEO Seiuli Alvin Tuala is set to visit the territory today to further discuss flights to Ofu Island.
The Samoa government owned Polynesian currently flies to Fitiuta Airport on Tau Island on 30-day cabotage waivers from the US Department of Transportation.
Taimalelagi says there are no problems filling seats to Ta'u, but Polynesian is concerned that they might operate at a loss if they start flights to Ofu.