; (3) in subsection (c), by striking Subparagraphs (B), (C), and (D) of subsection (a)(1) and inserting Paragraphs (2), (3), and (4) of subsection (a) ; (4) in subsection (d), by striking Subsection (a)(1)(B) and inserting Subsection (a)(2) ; (5) by striking subsection (e) and inserting the following: (e) Waivers The Secretary may waive, on an annual basis, subsection (a)(2) or subsection (a)(3)(A) with respect to a location if the location demonstrates to the Secretary’s satisfaction that the reason the location averages fewer than 10 enplanements per day or has a subsidy higher than $500 per passenger is due to a temporary decline in demand; provided, that the Secretary may not provide more than 2 consecutive waivers of subsection (a)(2) or subsection (a)(3)(A) to any location. ; and (6) in subsection (f), by striking subsection (a)(1)(B) and inserting subsection (a)(2) . (b) Improvements to basic essential air service (1) In general Section 41732 of title 49, United States Code, is amended— (A) in subsection (a)— (i) in paragraph (1), by striking hub airport and all that follows through beyond that airport and inserting medium or large hub airport ; and (ii) in paragraph (2), by inserting medium or large after nearest ; and (B) in subsection (b)— (i) in paragraph (2), by striking and at prices and all that follows through the period; and (ii) by striking paragraphs (3) through (6). (c) Level of basic essential air service Section 41733 of title 49, United States Code, is amended— (1) in subsection (c)(1)— (A) by striking subparagraph (B) and inserting the following: (B) the contractual, marketing, code-share, or interline arrangements the applicant has made with a larger air carrier serving the hub airport; ; (B) by striking subparagraph (C) and redesignating subparagraphs (D) through (F) as subparagraphs (C) through (E), respectively; (C) in subparagraph (D), as so redesignated, by striking and after the semicolon; (D) in subparagraph (E), as so redesignated, by striking the period at the end and inserting