Audit Report - 2009
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Prepared by the Management
of the
Salina Airport Authority
www.salinaairport.com
CUSIP #794760XXX
3237 Arnold I Salina, KS 67401 I 785-827-3914
~WWW.5alinaairport.com I www.flysalina.com
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SALINA AIRPORT AUTHORITY
TABLE OF CONTENTS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
F or the Fiscal Year Ended December 31, 2009
INTRODUCTORY SECTION
Letter of Transmittal..................................................................................... .1-8
Principal Officers............................................................................................9
Authority Staff Members ..... .................................. ......... .......:....... ................10
Organizational Chart..................................................................................... .11
Certificate of Achievement........................................................................... .12
Salina Municipal Airport Aerial View........ .......... ................................... ......13
FINANCIAL SECTION
Independent Auditors' Report .... ........................................ ............................15-16
Management's Discussion and Analysis ......................................................17-23
Statements of Net Assets .... .................... .......... ............ ... ..............................24-25
Statements of Revenues, Expenses and
Changes in Net Assets .............................................................................. .26
Statements of Cash Flows (Direct Method) ...................................................27 -28
Notes to Financial Statements....... ....................... ........ ........... ......... ..............29-44
Supplemental Information
Schedules of Revenues, Expenses and Changes in Net Assets ..................45-47
Capital Expenditures.................................................................................. .48-49
General Obligation Refunding Bonds - Series 1999-B...............................50
General Obligation Improvement Bonds - Series 2001-A..........................51
General Obligation Improvement Bonds - Series 2002-A..........................52
General Obligation Improvement Bonds - Series 2005-A .........................53
General Obligation Improvement Bonds - Series 2007-A.........................54
General Obligation Temporary Notes - Series 2007-1...............................55
General Obligation Improvement Bonds - Series 2009-A .........................56
General Obligation Improvement Bonds - Series 2009-B .........................57
Special Assessment Debt-Street and Utility Improvement.........................58
Special Assessment Debt-Sanitary Sewer Extension .................................59
Financing Lease Payable............................................................................ .60
Insurance in Force...................................................................................... .61
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STATISTICAL SECTION
Statistical Table of Contents .......................................................................62
Total Annual Revenues, Expenses and Changes in Net Assets History........63-64
Change in Cash and Cash Equivalents History ..............................................65-66
General Obligation Debt Service Coverage...................................................67
Capital Expenditure History ......................................................................... .68
Revenue Bond Coverage............. ................ ........................ ................ ... ........69
Local Government Mill Levy Rates, Direct and Overlapping.......................70
Principal Customers....................................................................................... 71
Mill Levy Revenue........................................................................................ 72
Air Traffic, Fuel Flowage, and Enplanement Trends .................................... 73
Major Employers ..... .......... ..... ....... ........... ... ..................... ..... ..... ... ................74
Saline County Population and Demographic Statistics .................................75
Saline County Largest Taxpayers and Tax Collection Statistics ...................76
COMPLIANCE
Report on Internal Control Over Financial
Reporting and on Compliance and Other Matters Based on an Audit
of Financial Statements Performed in Accordance with
Government Auditing Standards........................................................... 77-78
Report on Compliance with Requirements Applicable to
Each Major Program and Internal Control Over Compliance
In Accordance with OMB Circular A-133 ...........................................79-80
Schedule of Expenditures of Federal Awards................................................ 81
Notes to Schedule of Expenditures of Federal Awards ................................82
Summary Schedule of Prior Audit Findings .................................................83
Schedule of Findings and Questioned Costs .................................................84
Corrective Action Plan .................................................................................. 85
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For years, the terms "UAS" and "UA V' have been synonymous with
"futuristic" and "science fiction," but in a ribbon cutting ceremony for
the Unmanned Aircraft Systems Laboratory on Oct. 21, K-State at
Salina and its partners brought the future to the present.
\
The building is home to K-State's new and impressive Advanced
Avionics Miniaturization Program which is dedicated to the
miniaturization of unmanned systems and payloads by the rapid
insertion of advanced miniaturization technology into unmanned
aerial vehicle cameras, sensors and navigation systems.
Forecast International predicts that the worldwide market for UA Vs
may be worth more than $38 billion in the next decade.
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SA LINAA irport
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SA LINA Airport
Il~
Chairman
Jeffrey R. Thompson
Vice-Chairman
Troy Vancil
Secretary
Dr. Randy Hassler
Treasurer
Eric R. Hardman
Past Chairman
Julie Sager Miller
Executive Director Timothy F. Rogers, A.A.E.
Mgr. of Administration and Finance Michelle R. Swanson Mgr. of Operations David "Gunner" Wiles Mgr. of Facilities Kenny Bieker
Mgr. of Public Affairs and Communications Melissa l. McCoy
Board Attorney Greg A. Bengtson
June 16,2010
Salina Airport Authority Board of Directors
3237 Arnold Ave.
Salina, KS 67401
To the Board of Directors ofthe Salina Airport Authority:
The Comprehensive Annual Financial Report (CAFR) of the Salina Airport Authority (the "Authority")
for the fiscal year ended December 31, 2009 is hereby submitted in accordance with the Kansas Statutes
Annotated (K.S.A. 27-324). As required by the statute, the City of Salina will be furnished copies ofthe
Authority's 2009 CAFR. Responsibility for both the accuracy of the data presented and the
completeness and fairness of the presentation, including all disclosures, rests with the Executive Director
of the Authority. To the best of our knowledge and belief, the data as presented is accurate in all
material aspects, that it is presented in a manner designed to fairly set forth the fiscal position and results
of the operation of the Authority as measured by its financial activity, and that all disclosures necessary
to enable the reader to gain maximum understanding are included in the. report.
This CAFR is presented in accordance with generally accepted accounting principles (GAAP) and
pursuant to K.S.A 27-324, an audit of the books, accounts and financial statements has been completed
by the Authority's independent certified public accountants, Clubine and Rettele, Chartered. The
independent audit is in accordance with the Kansas Municipal Audit Guide. the Government Auditing
Standards issued by the Comptroller General of the United States, and the provisions of the Office of
Management and Budget Circular A-133, "Audits of States, Local Governments and Nonprofit
Organizations" .
GAAP requires that management provide an overview and analysis to accompany the financial
statements in the form of a Management Discussion and Analysis (MD&A). It is recommended that this
letter of transmittal be read in conjunction with the MD&A, which can be found immediately following
the report of the independent auditor in the Financial Section of this report.
REPORTING ENTITY
The Salina Airport Authority is a body corporate and politic. The Authority was created by the City of
Salina in April 1965 (Sec. 4-16, Salina City Code) pursuant to the authority granted by the City by the
surplus property and public airport authority act of the State of Kansas (K.S.A 27-315 et seq.) The
Authority was created for the purpose of accepting as surplus property portions of the former Schilling
AF.B., which was closed by the United States Department of Defense in June 1965. By quitclaim deed
the Authority received over 2,900 acres of land and numerous buildings for the purpose of operating and
INTRODUCTORY FY 2009
developing the Salina Municipal Airport and the Salina Airport Industrial Center. The Authority is
managed and controlled by a five-member Board of Directors appointed by the Salina City Commission.
The Board appoints the Executive Director, who is the chief executive officer of the Authority. The
Executive Director hires the remaining employees ofthe Authority. The Executive Director and his staff
of nineteen employees manage and operate the Salina Municipal Airport and the Salina Airport
Industrial Center.
The Salina Municipal Airport is the only commercial service airport serving Salina/Saline County and
the 24-county area, which comprises North Central Kansas. The Airport also services the corporate,
business, private aviation and flight training needs of industry, business and individuals in the area. The
Airport is also used by Kansas State University at Salina (KSUS). The campus of KSUS is located
adjacent to the Airport. The college offers degrees in professional flight training, airframe and power
plant maintenance, and avionics technology.
The Salina Municipal Airport and Airport Industrial Center is home for 80 businesses and organizations.
Forty-five of the businesses and organizations are tenants of the Authority. One of the primary functions
of the Authority is to facilitate the continued growth of jobs and payroll at the Airport and Airport
Industrial Center. The Authority works in partnership with the City of Salina, Saline County and the
Salina Area Chamber of Commerce for the retention of existing business and industry and the
recruitment of new business and industry.
ECONOMIC CONDITIONS AND OUTLOOK
Local Economv
The Salina/Saline County economy has continued to demonstrate economic strength, as compared to
other regions of the state. In fact, Salina is the employment center for a large 13-county labor pool of
nearly 44,000 individuals. At the end of 2009, the Saline micro area unemployment rate was at 5.6%.
Even during these times of economic challenges, the area's unemployment rate has remained below the
State and National average. Salina's visitor count during 2009 is estimated at over 600,000. Lodging
revenue reached a record' high of over $19 million. Growth in the areas of manufacturing,
transportation, finance, real estate, insurance, services and retail trade, confirm Salina's position as one of
Kansas' strongest regional economic centers. Collectively, Salina retail sales are pushing above
$900,000 million and towards the $1 billion threshold annually.
Salina is the trading center of a 24-county area in North Central Kansas. In the past year, retail sales
increased by more than 4%. Recent retail sales activity in Salina increased at a faster pace as other areas
were declining. Salina has a 1.485 "pull-factor" reflecting the overall strength of the community as a
regional retail draw. Major retail firms opening or expanding in recent years include Kohl's, Petco, Old
Navy, Hobby Lobby, Logan's Roadhouse and Ashley's Furniture Store. Menard's has announced the
opening of a Salina location.
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INTRODUCTORY FY 2009
Economic Condition of the Airport and Airport Industrial Center
As of December 31, 2009, over 80 businesses and organizations at the Salina Municipal Airport and
Airport Industrial Center employed over 4,000 employees with a combined payroll in excess of $150
million.
Future Economic Outlook
The future economic outlook for both Salina and the Authority continues to look favorable. Continued
growth in service, retail and manufacturing sectors is expected. The Salina Area Chamber of Commerce
forecasts that approximately 700 new jobs per year will be added to the economy over the next three to
five years.
Salina Aviation Service Center businesses including CA V Aerospace, Kansas State University at Salina,
America Jet at SLN, and Flower Aviation continue to work on facility expansion plans. Salina Airport
Industrial Center businesses including Geoprobe Inc., Schwan's Food Manufacturing Inc., and the
Kansas Army National Guard at Salina, also continue to work on facility expansions. Collectively, these
expansions will result in additional jobs and payroll.
The Salina Airport Authority in partnership with the Salina Area Chamber of Commerce, the City of
Salina and Saline County, continue to execute an economic development strategic plan that include web
based building and site directories, electronic newsletters, trade show participation and expanding
contacts through the Kansas Department of Commerce. The Airport Authority contracts the services of
Mr. James Gregory, James Gregory Consultancy, for national and international recruitment of aerospace
business to locate at the SLN Aviation Service Center.
INITIATIVES AND DEVELOPMENT
Secure 95% grant funding from the Federal Aviation Administration to complete the design of a new
Aircraft Rescue and Fire Fighting Station.
During 2010, the Authority will complete the design of new T -hangars at the Aviation Service Center
that will provide approximately 150 new general aviation t-hangars for the users of the Salina Municipal
Airport.
The Authority will continue the partnership with City of Salina, USD 305, K-State and the Kansas
Board of Regents to finalize settlement negotiations with the U.S. Department of Justice relative to the
environmental clean-up of portions of the former Schilling Air Force Base. (See Note G in the Notes to
the Financial Statements).
With the 2009 announcement of the Salina Hawker Beechcraft facility closing, the SAA will target
specific aviation service sectors to maximize recruiting efforts and the highest priority will be given to
putting jobs back in the buildings.
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INTRODUCTORY FY 2009
Finance and Administration
Cash Reserves
A significant financial objective for the Authority over the next three years is to increase cash reserves.
The goal is to increase reserve levels to $1.3 million by 2013. This will be a critical objective in order to
maintain the Authority's Aa2 bond rating.
2007-A General Obligation Temporary Note Issue
The Authority's 2007-A General Obligation Temporary Notes ($7.05 million) will mature at the end of
the third quarter of201O. The temporary notes were issued in 2007 to fund the construction and
development of Hangar 600. During 2010, the Authority will explore the option of renewing the
temporary notes or securing permanent financing for the balance of the outstanding temporary notes.
Accounting Standards and Practices
Early implementation and compliance with all new Governmental Accounting Standards Board (GASB)
statements is always the practice. During 20 I 0 the SAA will insure that it is in compliance with GASB
Statement No. 45, which was issued to provide more complete, reliable and decision-useful financial
reporting regarding the costs and financial obligations that governments incur when they provide certain
postemployment benefits as part of the compensation for services rendered by their employees.
To continue our efforts in improving Board involvement in the accounting and financial responsibilities
of the SAA, the Board treasurer will continue to review monthly financial statements with the Manager
of Administration and Finance prior to each Board Meeting.
In addition, the SAA will again establish a formal audit committee for the 2009 financial statement
audit.
Government Finance Officer Association (GFOA) Achievement Award
SAA's 2009 Comprehensive Annual Financial Report (CAFR) will be submitted to GFOA for review
and award of a Certificate of Achievement for Excellence in Financial Reporting.
Energy Efficiency
Throughout 2010, Authority staffwill utilize the services of the government backed program, Energy
Star to assist in saving resources to protect the environment through energy efficient products and
services. This process includes collecting facility data that will allow us to evaluate energy performance
of buildings and facilities.
Personnel Manual Update
SAA personnel policies and procedures will be reviewed and updated. An updated personnel manual
will be prepared to replace the current version.
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INTRODUCTORY FY 2009
Policies and Procedures
As a continuation of our update to the Airport Rules and Regulations, the SAA staff will work with
Clark, Mize and Linville staff to assist in developing policies and procedures that further clarify and
define doing business, operating or conducting activities at the Salina Municipal Airport and Salina
Airport Industrial Center
Property/Liability Insurance
During the first quarter of the year the SAA will develop a Request for Proposal package for
property/liability insurance brokerage/agent services.
Public Affairs. Marketine and Soecial Events
SLN Aviation Service Center
The new year's efforts will focus on continued mention of the SLN Aviation Service Center growth.in
national and international aviation/aerospace news media. Through the development of a strategic plan,
the Salina Airport Authority and Salina Area Chamber of Commerce have identified existing
community-based aviation-based aviation and aerospace businesses for growth opportunities and the
international aerospace industry as recruiting prospects. The Salina Airport Authority will target specific
aviation service sectors to maximize recruiting effectiveness.
Publications and tactics will be continued that have worked well for us in the past, these include the
services of a recruiter, the electronic newsletter, building relationships with aviation media to continue
earned media and the annual aviation media tour with new presentation material. During 2010 out of
state recruiting trips will result in meetings with over 45 prospective aerospace businesses.
When facilities currently occupied by Hawker Beechcraft become available or we are provided with
hard dates of when those facilities will be available the highest priority will be given to putting jobs back
in those building. Please refer to the General Prospect Package for more information on those building
and what industry they are best suited for.
Air Service Promotion and Marketing
Following the Department of Transportation's announcement ofthe selection of SeaPort Airlines as
Salina's new essential air service provider, SeaPort took over the service from Salina to Kansas City in
April 2010, replacing Great Lakes Airlines. With three daily roundtrip flights Sunday through Friday,
the Salina and surrounding communities are serviced by the impeccable safety and reliability of the
airline's 9-seat Pilatus PC-12 aircraft. SeaPort Airlines is a dba of Alaska Juneau Aeronautics, an FAA
Part 135 certified scheduled air carrier founded in 1983. SeaPort Airlines operates 115 daily scheduled
flights during the weekdays in five Northwest cities, five Mid-South cities, seven Southeast Alaska cities
via Wings of Alaska and all with hassle-free check in, bringing the convenience of a private aircraft to
the average traveler for the same cost as traditional airlines.
Salina Air Service will continue to be promoted through a monthly article in the Airport Authority
electronic newsletter and through promotional ads on their behalf.
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INTRODUCTORY FY 2009
SLN - A Destination Airport for General Aviation
The Airport Authority will continue to actively recruit General Aviation (GA) to the Salina Municipal
Airport. In the past, the Salina Area Chamber of Commerce has worked with groups like the Flying
Dentists and Flying Farmers to come into SLN.
Airport Authority staffwill work closely with Chamber Visitor's Bureau (Visit Salina) staff to find and
recruit General Aviation groups to fly into SLN and have meetings in Salina. Staff will also work
closely with SLN's two FBO's to position SLN as the destination for General Aviation.
To achieve positioning SLN as a destination spot for GA, staffwill market to groups such as the Flying
Dentists, Flying Farmers and the Experimental Aircraft Association (EAA). Staffwill also work closely
with K-State at Salina, develop workshops with CA V Aerospace and develop relationships with local
attractions for group fly-in events.
FINANCIAL CONTROLS
The Authority follows generally accepted accounting principles applicable to governmental unit
enterprise funds. Accordingly, the financial statements are prepared on the accrual basis.
Management of the Authority is responsible for establishing and maintaining an internal control
structure designed to ensure that the assets of the Authority are protected from loss, theft, or misuse and
to ensure that adequate accounting data is compiled to allow for the preparation of financial statements
in conformity with generally accepted accounting principles. The internal control structure is designed
to provide reasonable, but not absolute, assurance that these objectives are met. The concept of
reasonable assurance recognizes that: (1) the cost of a control should not exceed the benefits likely to be
derived; and (2) the valuation of costs and benefits requires estimates and judgments by management.
An annual budget is prepared in accordance with the Authority's By-laws. However, the Authority is
specifically exempt from the budget laws ofthe State of Kansas (K.S.A. 27-322) and the Authority is not
required to demonstrate statutory compliance with its annual operating budget. Accordingly, budgetary
data is not included in the accompanying financial statements.
CASH MANAGEMENT
All cash temporarily idle during 2009 was invested by the Executive Director of the Authority in short-
term investments to attain the highest possible return consistent with the Authority's liquidity needs. All
investments are in compliance with K.S.A. 12-1675 which controls the investment of public funds by
Kansas governmental units.
RISK MANAGEMENT
The Authority is exposed to risks of loss associated with the operation of a public use airport and the
operation of an airport industrial center. To handle the associated risks of loss, the Authority uses
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INTRODUCTORY FY 2009
available tort liability legislation and purchases the appropriate types of insurance coverage. It is the
policy of the Authority to eliminate or transfer risk ofloss where possible.
The Kansas Tort Claims Act (K.S.A. 75-6101 et seq.) generally limits tort liability for Kansas
governmental entities. The maximum liability for claims as specified by the Act is $500,000 for any
number of claims arising out of a single occurrence or accident. For wrongful acts, Kansas
governmental entities or their employees are exempted from liability.
The Authority carries $1,000,000 of comprehensive general liability insurance. During 2009 the
Authority carried $28,793,138 of insurance on airport commercial properties. The Authority also
acquires construction builders' risk policies for all major construction projects or requires evidence of
coverage from the contractor.
The Authority's commercial property insurance included $1,765,779 in loss of rents coverage. All
contractors and lessees are required to carry amounts of property insurance with limits and deductibles
approved by the Authority. A schedule of insurance in force at December 31, 2009 is included in the
Supplemental Section of this report.
In addition, the Authority uses various risk management techniques. All contracts and leases are
reviewed by the Authority's legal counsel. All contractors and subcontractors are required to submit
evidence of insurance coverage naming the Salina Airport Authority and the City of Salina as named
additional insured.
GFOA CERTIFICATE OF ACHIEVEMENT
The Government Finance officers Association of the United States and Canada (GFOA) Awarded a
Certificate of Achievement or Excellence in Financial Reporting to the Salina Airport Authority for its
comprehensive annual financial report for the fiscal year ended December 31, 2008. In order to be
awarded a Certificate of Achievement, a government must publish an easily readable and efficiently
organized comprehensive annual financial report. This report must satisfY both generally accepted
accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current
comprehensive annual financial report continues to meet the Certificate of Achievement Program's
requirements and we are submitting it to the GFOA to determine its eligibility for another certificate.
ACKNOWLEDGEMENTS
The support of the Authority's Board of Directors has been instrumental in the preparation of this report.
The Board has been actively involved in the preparation and review of this report and is committed to
responsible and progressive financial reporting.
Also acknowledged is the assistance of the Authority's auditor, Clubine and Rettele, Chartered, the
Authority's accounting advisor, Thomas G. Arnett, CPA, Saline County Clerk's Office, Dennis Lauver,
President of the Salina Area Chamber of Commerce, Rod Franz, Director of Finance for the City of
Salina, Sean McIntire and Grant Swinehart, Kansas State University at Salina students and Salina
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INTRODUCTORY FY 2009
Airport Authority Airport Management Interns, the University of Kansas Institute for Public Policy and
Business Research and the Kansas Department of Human Resources Labor Market Information
Services, in the preparation of this report.
R~~rtfuIJY submitted,
Timothy F. Ro rs,
Executive Director
Salina Airport Authority
V72~ <-< ~eyJ
Michelle R. Swanson
Manager of Administration and Finance
Salina Airport Authority
cc: The City of Salina Board of Commissioners
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IN I ROm'C lOR Y I 'i ~(JlI')
SALINA AIRPORT AUTHORITY
PRINCIPAL OFFICERS AS OF DECEMBER 31.2009
Pictured from left to right:
Troy Vancil, Secretary; Julie Sager Miller, Chairman, Jeffrey R. Thompson, Vice Chairman, Timothy F. Rogers, Executive Director; Greg Bengtson,
Authority Counselor; Dr. Randy Hassler, Treasurer, and Eric R. Hardman, Past Chairman.
AUTHORITY'S BOND COUNSEL
Gilmore & Bell
Kansas City, Missouri
AUTHORITY'S FINANCIAL ADVISOR
George K. Baum & Company
Kansas City, Missouri
AUTHORITY'S AUDITOR
Leslie M. Corbett, C.P.A.
Clubine & Rettele, Chartered
Salina, Kansas
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IN I RODl '(' lOR Y 1'\ ~11(ll)
SALINA AIRPORT AUTHORITY
Staff Members as of December 31. 2009
ADMINISTRATIVE STAFF
Timothy F. Rogers, A.A.E.
Michelle R. Swanson
David "Gunner" Wiles
Kenny Beiker
Melissa L. McCoy
Donald C. Kneubuhl
Kasey L. Windhorst
Executive Director
Manager of Administration and Finance
Manager of Operations
Manager of Facilities
Manager of Public Affairs and Communications
Manager of Special Projects
Executive Assistant
FACILITY MAINTENANCE and OPERATIONS
Loren Carleton - Team Leader
Gary Hansen
Kim Colby
Rob Pejsha
Dale Mattison
AIRCRAFT RESCUE AND FlREFIGHTING and SAFETY and SECURITY
David Nease - Team Leader
Ron Boyd Alan Mason
Matthew Rittel David Clark
Andrew Harper
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President
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12 I
Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
Salina Airport Authority
Kansas
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
December 31, 2008
A Certificate of Achievement for Excellence in Financial
Reporting is presented by the Government Finance Officers
Association of the United States and Canada to
government units and public employee retirement
systems whose comprehensive annual financial
reports (CAFRs) achieve the highest
standards in government accounting
and financial reporting.
~/~
Executive Director
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IN I RODllCTOR Y 1'\ 211(1')
/iou-M~
SLNAirport
~ ~
SALINAAirport
. /I~ "
. 1"11
'--- -----J
/~AviatiOn
Service
SLMCenter
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SALINAA7JJfJ
1~~+
13
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(THIS PAGE INTENTIONALLY LEFT BLANK)
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-n
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^
r \
Hundreds oflocal and state emergency responders came together in
June for the largest crisis exercise to date at the Great Plains Joint
Training Center's Crisis City.
Police, firefighters, hazmat responders, search and rescue teams, K-9
units, National Guardsmen and Red Cross workers came together for
the Vigilant Guard 2009 exercise. They brought with them everything
they would need in a disaster from chicken salad sandwiches to hard
hats, and unmanned aerial systems to C-130s.
,
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,
1.._____________..______________________-1
A big part of the team's efficiency is due to the venue's close proximity
to the airport. While hundreds of U.S. first responders were on the
ground at Crisis City digging through rubble and containing chemical
spills, Canadian Air Force CF-18s and AlphaJ ets, along with U.S. C-
130S were on the airport flight line a mere 8 nm away.
~ ~
y
SA LINAAirport
=;:J~=
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CLUBlNE&
RETIELE
CHAKIERED
Certified Public Accountants
"
Robert I. Clubine, C.P.A.
David A. Rettele, C.P.A.
Jay D. Langley, C.PA
Jon K. Bell, C.PA
Leslie M. Corbett, C.P.A.
Stacy J. Osner, C.P.A.
Marci K. Fox, C.PA
John T. Millikin, C.PA
Linda A. Suelter, C.PA
218 South Santa Fe
P.O. Box 2267
Salina, Kansas
67402-2267
Salina
785/825-5479
Salina Fax
785 / 825-2446
Ellsworth
785/472-3915
Ellsworth Fax
785/472-5478
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
Salina Airport Authority
We have audited the accompanying financial statements of Salina Airport
Authority, a component unit of the City of Salina, Kansas, as of and for the years
ended December 31, 2009 and 2008, as listed in the table of contents. These
financial statements are the responsibility ofthe Authority's management. Our
responsibility is to express an opinion on these financial statements based on our
audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America and the standards applicable to financial audits
contained in Government Auditing Standards, issued by the Comptroller General of
the United States and the Kansas Municipal Audit Guide, prescribed by the
Director of Accounts and Reports, Department of Administration of the State of
Kansas. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our opinions.
In our opinion, the financial statements referred to above present fairly, in all
material respects, the financial position of Salina Airport Authority, as of
December 31, 2009 and 2008, and the changes in financial position and cash flows
for the years then ended in conformity with accounting principles generally
accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report
dated June 3, 2010, on our consideration of Salina Airport Authority's internal
control over financial reporting and our tests of its compliance with certain
provisions of laws, regulations, contracts, and grant agreements and other matters.
The purpose of that report is to describe the scope of our testing of internal control
over financial reporting and compliance and the results of that testing and not to
provide an opinion on the internal control over financial reporting or on
compliance. That report is an integral part of an audit performed in accordance
with Government Auditing Standards and important for assessing the results of our
audits.
Accounting principles generally accepted in the United States of America require
that the management's discussion and analysis on pages 17 through 23 be presented
to supplement the basic financial statements. Such information, although not a part
of the basic financial statements, is required by the Governmental Accounting
Standards Board, who considers it to be an essential part of financial reporting for
placing the basic financial statements in an appropriate operational, economic or
historical context. We have applied certain limited procedures to the
15
required supplementary information in accordance with auditing standards generally accepted in the United
States of America, which consisted of inquiries of management about the methods of preparing the
information and comparing the information for consistency with management's responses to our inquiries, the
basic financial statements and other knowledge we obtained during our audit of the basic financial statements.
We do not express an opinion or provide any assurance on the information because the limited procedures do
not provide us with sufficient evidence to express an opinion or provide any assurance.
Our audit was conducted for the purpose of forming opinions on the financial statements as a whole. The
Introductory Section, the accompanying schedules and additional information listed in the supplemental
information of the Financial Section and the Statistical Section of the table of contents are presented for
purposes of additional analysis and are not a required part of the financial statements. The accompanying
schedule of expenditures of federal awards is presented for purposes of additional analysis as required by U. S.
Office of Management and Budget Circular A-l33, Audits of States, Local Governments and Non-Profit
Organizations, and is also not a required part of the financial statements. The schedule of expenditures of
federal awards is the responsibility of management and was derived from and relates directly to the underlying
accounting and other records used to prepare the financial statements. The information has been subjected to
the auditing procedures applied in the audit of the financial statements and certain additional procedures,
including comparing and reconciling such information directly to the underlying accounting and other records
used to prepare the financial statements or to the financial statements themselves, and other additional
procedures in accordance with auditing standards generally accepted in the United States of America. In our
opinion, the information is fairly stated in all material respects in relation to the financial statements as a
whole. The Introductory Section of the accompanying schedules and additional information listed in the
supplemental information of the Financial Section and the Statistical Section of the table of contents have not
been subjected to the auditing procedures applied in the audit of the basic financial statements and,
accordingly, we do not express an opinion or provide any assurance on them.
CLUBINE AND RETTELE, CHARTERED
~~ /t("d ,{utd(
June 3, 2010
16
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FINANCIAL I" 21111')
MANAGEMENT'S DISCUSSION AND ANALYSIS
The management of the Salina Airport Authority offers the readers of the Authority's audited financial
statements this narrative overview and analysis of the financial activities of the Salina Airport Authority
for the fiscal year ended December 31, 2009.
AIRPORT ACTMTY AND HIGHLIGHTS
The Salina Air Traffic Control Tower (ATCT) ended 2009 having handled 65,062 aircraft operations.
This represented a 9.10% decrease in total aircraft operations over the prior year, which was better than
expected due to significant airfield construction that resulted in multiple runway and taxiway closures.
During 2009, the Authority substantially completed a multi-year phased rehabilitation ofthe Airport's
parallel Taxiway A.
The highest year for the most recent 1 O-year period was 2002 at 95,801 aircraft operations. Salina
continues to remain strong as a mid-continent refueling stop and has earned the recognition as "America's
Fuel Stop". The Airport's two world-class fixed base operators (FBOs) and tenants of the Authority,
annually deliver 2.5 - 3.8 million gallons of fuel to thousands of business jets, government and military
aircraft.
The commercial airline industry continues to experience financial stress, especially for the carriers
attempting to serve rural communities such as Salina through the Department of Transportation's (DOT)
Essential Air Service Program. The 39% decrease in passenger enplanements from 2008 to 2009 was a
result of Great Lakes discontinuing the daily flights to Denver that had brought about an increase in 2008
after they had transitioned to dual hub service. At the end of 2009, Great Lakes was offering multiple
weekday and weekend flights to Kansas City while arriving at the end of their two-year EAS contract.
As the year ended, the Authority and the Salina community began working in partnership with the DOT to
Seek air carriers interested in providing air service to the residents of North Central Kansas for the next
two-year EAS term and beyond.
The changes in the Authority's major airport activity indicators for the past three years are as follows:
2009 2008 2007
Enplanements - Scheduled Air Carrier & Charter Flights 2,839 4,654 2,495
% increase / (decrease) -39.00% 86.53% 22.97%
Aircraft Operations - All Categories 65,062 71,575 76,479
% increase / (decrease) -9.10% -6.41 % -6.12%
Fuel Flowage - (gallons delivered) 2,481,585 3,114,515 3,778,794
% increase / (decrease) -20.32% -17.58% -1.00%
17
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l'I~i\NCli\L I') 21111')
AIRPORT INDUSTRIAL CENTER ACTIVITY AND HIGHLIGHTS
The Authority owns nearly 900,000 sq. ft. of manufacturing, warehouse and office space at the Airport
Industrial Center. As further described herein, the building revenue generated by the Authority's leasing
activity constitutes a significant portion of the annual operating revenue budget. During 2009, building
rents equaled $1,402,230 or 67% of operating revenue. At the end of 2009, the Authority had an
occupancy rate of over 95% in its building inventory.
SUMMARY OF OPERATIONS AND CHANGES IN NET ASSETS
Even with the uncertainty in the aviation industry and the slow growth in the economy, the financial
condition of the Authority has held steady in recent years. The Authority has effectively dealt with major
cost increases in employee health benefits including medical insurance premiums, utility costs,
commercial property insurance premiums and other operating expenses. Fortunately, with the diversified
revenue base, including building and land rental from the Authority's Industrial Center, total operating
Revenue has grown from $1.6 million in 2002 to $2.1 million in 2009.
Operating Revenues
Operating Expenses
2009
$ 2,098,576
(2,220,128)
Excess before Depreciation
and other non-operating
income and expenses
(121,552)
Depreciation
(1,748,348)
Excess (loss) before
other non-operating
income and expenses
(1,869,900)
Other Non-Operating Income
and (Expenses) net
387,831
Loss before
Capital Contributions
(1,482,069)
Capital Contribu~ions
3,770,558
Increase in Net Assets
$ 2,288,489
2008
$ 2,152,370
(2,245,300)
2007
$ 2,483,312
(1,969,015)
(92,930)
514,297
(1,606,811)
(1,650,187)
(1,699,741)
(1,135,890)
419,492
668,765
(1,280,249)
(467,125)
1,650,041
404,773
$ 369,792
$
(62,352)
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FINANCIAL 11 ::'1 JI I')
SUMMARY OF OPERATIONS HIGHLIGHTS
Significant items effecting the Summary of Operations and Changes in Net Assets for 2009 and 2008 are
as follows:
. Operating revenues have remained steady in recent years despite the downturn in the overall
economy. Revenues from aircraft storage and hangar rentals have assisted in offsetting the
decrease in revenue derived from the delivery and sale of aviation fuel at the Airport. The fuel
flowage fees received by the Authority for each gallon of fuel delivered at the Airport decreased
17% in 2008 and 21 % in 2009 over each prior year. A decrease in corporate and general
aviation flying due to the economy and severe winter weather in 2009 resulted in a 31 % decrease
in itinerant general aviation operations over 2008. Fortunately, military traffic increased by 17%
providing the demand to keep the operations and fuel sales from further downward pressure.
Building and land revenue decreased only slightly; less than 1 percent, and has increased nearly
50% in the past five years.
. Operating expenses increased by 12.3% from 2007 to 2008 however the Authority in 2009 was
able to reduce operating expenses by $25,172 or 1 %.
o During 2009, the Authority made a concerted effort to hold and reduce operating costs by
reducing travel and meeting expense as well as reducing all dues and subscriptions and
cancelling all non-essential items.
o In addition, the Authority was able to reduce building maintenance expense by nearly
60% in 2009 by utilizing in-house personnel for items that were previously contracted out
to third party vendors.
. Depreciation expense increased due to new construction moving from construction in progress to
an asset in service and very capital intensive years in 2008 and 2009.
. Capital contributions increased by $2.1 million as a result of contributions from six grants from
the Federal Aviation Administration Airport Improvement (AlP) grant programs and one new
grant from the Kansas Department of Transportation. During 2009 these grants funded. the
Authority's construction of a significant portion of a multi-year taxiway rehabilitation project and
a mill and inlay project on the Airport's primary runway. Ad-valorem tax revenue (mill levy)
received by the Authority as a local taxing entity increased by 5.6% from 2008 to 2009 and 4.6%
from 2007 to 2008. Interest received on investments and a financing lease decreased by $110,902
or 60% from 2008 to 2009 which was due to a reduction in bond proceeds on deposit as well as a
decrease in investment interest rates.
19
FINANCIAL 1\ 21111<)
FINANCIAL POSITION SUMMARY
The changes in net assets may serve over time as a useful indicator of a government's financial position.
The Authority's assets exceeded liabilities by $28,065,307 at the close of2009. A condensed summary of
the Authority's total net assets at December 31 is shown below.
2009
2008
2007
ASSETS
Current and other assets
Capital assets
Total assets
4,524,282
47,774,283
52,298,565
3,752,996
42,562,780
46,315,776
14,685,187
35,215,229
49,900,416
LIABILITIES
Long-term debt outstanding
Other liabilities
Total liabilities
17,276,448
3,262,510
20,538,958
21,015,879
3,477,511
24,493,390
13,260,869
10,972,389
24,233,258
NET ASSETS:
Invested in capital assets,
net of related debt
Restricted
Unrestricted
26,410,681
24,471,896
13,515,783
1,304,922
11,891,243
1,654,626
TOTAL NET ASSETS
$ 28,065,307
$ 25,407,026
$ 25,776,818
By far the largest portion of the Authority's net assets (94%) reflects its investment in capital assets
including land, buildings, airfield infrastructure and machinery and equipment, less any related debt used
to acquire those assets that is still outstanding. The Authority uses these capital assets to provide services
to citizens; consequently, these assets are not available for future spending. Although the Authority's
investment in its capital assets is reported net of related debt, it should be noted that the resources needed
to repay this debt must be provided from other sources, since the capital assets themselves cannot be used
to liquidate these liabilities.
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IT\X\CIAL 1\ 21111')
REVENUES
The following chart shows the major sources and the percentage of total operating revenues for the year
ended December 31, 2009:
Other revenue
1%
Building and land rent
67%
A summary of revenues for the past three years is shown below. Total revenue decreased by 2.6% from
2008 to 2009 and 13.3% from 2007 to 2008. As discussed above the decrease is a result of decreased
airfield revenue and interest income on deposits. In addition the Authority did not have any significant
sales of available land or buildings in recent years.
2009 2008 2007
Operating Revenue:
Airfield $667,636 $680,474 $622,666
Building and land rent 1,402,230 1,407,984 1,525,071
Gain (loss) on sale of assets 0 16,321 281,803
Other revenue 28,710 47,591 53,772
Total Operating 2,098,576 2,152,370 2,483,312
Non-Operating Income:
Mill Levy 1,327,647 1,256,816 1,201,602
Interest Income 74,313 185,215 241,478
Total Non-Operating 1,401,960 1,442,031 1,443,080
TOTAL REVENUE $3,500,536 $3,594,401 $3,926,392
21
FIN.\'\CI,\1 I" :'I)I)'!
EXPENSES
The following chart shows the major expense categories and the percentage of total operating expenses for
the year ended December 31, 2009:
Maintenance
38%
A summary of expenses for the past three years is shown below. Total expenses decreased by a by 1%
from 2009 to 2008 following an increase of 19.1% from 2007 to 2008. The Authority took significant
steps to hold operating expenses in 2009 including completing more facility maintenance projects in-
house and reducing administrative expenses such as travel and expenses.
2009 2008 2007
Operating Expenses
Administrative $ 1,352,357 $ 1,303,374 $ 1,161,530
Maintenance 867,771 941,926 807,485
Total Operating 2,220,128 2,245,300 1,969,015
Non-Operating Expense
Interest Expense 987,379 996,985 742,249
Amortization of bond costs 26,750 25,554 32,066
Total Non-Operating 1,014,129 1,022,539 774,315
TOTAL EXPENSES $ 3,234,257 $ 3,267,839 $ 2,743,330
22
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FINANCIAL I) 2()(),)
CAPITAL ACQUISITIONS AND CONSTRUCTION ACTIVITIES
The Authority acquired $6,959,850 of capital assets during 2009. Significant items included the
substantial completion of a 69,000 sq. ft. maintenance repair and overhaul hangar facility. Other major
capital improvements included the construction of a multi-year, multi-million dollar Taxiway
rehabilitation project. The construction of this project is expected to be complete in 20 I 0 and will be
funded primarily through Federal Aviation Administration Airport Improvement Program Grant funds. [n
addition, 2009 marked the Authority's second consecutive year to participate in the Defense Reutilization
Marketing Office (DRMO) program. The DRMO entity disposes of United States military surplus
property. The Authority acquired numerous capital equipment assets having a fair value of $96,051.
Additional information can be found in Note [ (C) in the notes to the financial statements.
Capital asset acquisitions exceeding $1,000 are capitalized at cost and are depreciated over their useful
lives, with the exception of land. The Authority's capital assets are financed using Federal and State
grants with matching Authority funds, debt issuance and Authority revenues. Additional information on
the Authority's capital assets can be found in Note 1Il (D) in the notes to the financial statements and
within the Supplemental Section of this report.
DEBT ADMINISTRATION
The outstanding long-term debt of the Authority was $21,363,602 at December 31, 2009. This debt
consists of general obligation bonds, general obligation temporary notes, financing lease and City of
Salina special assessments. Maturities range from 2010 through 2029. Both principal and interest are
payable from proceeds of a direct financing lease, the general revenues of the Authority and mill levy
revenue. During 2009, the Authority issued $8,105,000 in General Obligation Bonds which included
permanently financing $3,925,000 in General Obligation Temporary Notes. Details of the Authority's
debt can be found in Note 1Il (E) in the notes to the financial statements.
REQUEST FOR INFORMATION
This Management Discussion and Analysis is designed to provide detailed information on the Authority's
operations and the financial results of those operations to all those with an interest in the Authority's
financial affairs. Questions concerning any of the information provided in this report or requests for
additional information should be addressed to the Manager of Administration and Finance bye-mail:
shellis@salair.org or in writing to, Salina Airport Authority, 3237 Arnold Ave., Salina, KS 67401.
Respectfully submitted,
M~
Executive Director
VlUiJuLu<i .~
Michelle R. Swanson
Manager of Administration and Finance
23
FINANCIAL FY 2009
SALINA AIRPORT AUTHORITY
STATEMENTS OF NET ASSETS
ASSETS December 31
2009 2008
CURRENT ASSETS
Cash $ 2,037,114 $ 1,871,999
Accounts receivable 193,158 69,326
Prepaid expenses 1,018 5,247
Inventory - A vgas 2,031
Taxes receivable 1,849,957 1,281,413
Total Current Assets 4,083,278 3,227,985
LONG-TERM ASSETS
Capital Assets
Land
Buildings, improvements and equipment,
net of depreciation
Construction in progress
10,045,937
9,675,910
26,503,254
11,225,092
24,065,550
8,821,320
Total Capital Assets
42,562,780
47,774,283
Other Long-Term Assets
Net investment in finance lease
Bond issue costs, less accumulated amortization
of $287,668 and $235,364 respectively
Total Other Long-Term Assets
309,881
443,123
131,123
441,004
81,888
525,011
Total Noncurrent Assets
43,087,791
48,215,287
TOTAL ASSETS
$ 52,298,565
$ 46,315,776
(continued)
See notes to financial statements.
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FINANCIAL FY 2009
SALINA AIRPORT AUTHORITY
STATEMENTS OF NET ASSETS
( continued)
LIABiLITIES AND NET ASSETS
December 31
2009 2008
$ 46,766 $ 67,558
399,522 535,691
58,048 50,839
55,868 47,220
16,070 16,070
1,849,957 1,281 ,413
2,768 3,578
27,3] 0 91,817
385,245 320,59]
28,102 33,296
8,102,733 8]4,437
10,972,389 3,262,510
CURRENT LIABILITIES:
Accounts payable-operations
Accounts payable-capital purchases
Accrued payroll and expenses
Accrued property tax
Accrued special assessments
Deferred tax revenue
Deferred maintenance agreement
Unearned rental income
Accrued interest
Unearned interest - financing lease
Current maturities of long-term debt
Total Current Liabilities
LONG-TERM LIABiLITIES
Bonds and note payable, less current maturities
13,260,869
17,276,448
Total Liabilities
24,233,258
20,538,958
NET ASSETS
invested in capital assets, net of related debt
Unrestricted
24,471,896
1,304,922
26,410,681
1,654,626
Total Net Assets
28,065,307
25,776,818
TOT AL LIABILITIES AND NET ASSETS
$ 52,298,565
$ 46,315,776
See notes to financial statements.
25
FINANCIAL FY 2009
SALINA AIRPORT AUTHORITY
STATEMENTS OF REVENUES, EXPENSES
AND CHANGES IN NETASSETS
January 1 to December 31
2009 2008
OPERATING REVENUES
Airfie Id
Building and land rent
Gain on sale of assets
Other revenue
$ 667,636 $ 680,474
] ,402,230 ],407,984
] 6,321
28,710 47,591
2,098,576 2,152,370
Total Operating Revenues
OPERATING EXPENSES
Administrative
Maintenance
1,352,357 1,303,374
867,771 941,926
2,220,128 2,245,300
(121,552) (92,930)
1,748,348 1,606,811
(1,869,900) (1,699,741)
Total Operating Expenses
OPERATING INCOME BEFORE DEPRECIATION
DEPRECIATION
OPERATING LOSS
NON-OPERATING INCOME AND (EXPENSES)
Mill levy
Interest on investments and financing lease
Interest expense
1,327,647 ] ,256,816
74,313 185,2]5
(1,014,129) (1,022,539)
387,831 419,492
(1,482,069) ( 1,280,249)
3,770,558 1,650,041
Total Non-Operating Income and (Expenses)
LOSS BEFORE CAPITAL CONTRIBUTIONS
CAPITAL CONTRIBUTIONS
NET ASSETS
Increase (decrease) in Net Assets
2,288,489
369,792
TOTAL NET ASSETS, beginning of year
25,407,026
25,776,818
TOTAL NET ASSETS, end of year
$ 28,065,307
$ 25,776,818
See notes to financial statements.
26
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FINANCIAL FY 2009
SALINA AIRPORT AUTHORITY
STATEMENTS OF CASH FLOWS
(DIRECT METHOD)
January 1 to December 31
2009 2008
CASH FLOWS FROM OPERATING ACTIVITIES
Cash received from providing services
Cash paid to employees for services
Cash paid to suppliers for goods and services
$ 1,974,744
(830,298)
(1,457,074)
"
Net Cash Provided (Used) in Operating Activities
(312,628)
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES
Acquisition and construction of property, plant and equipment (6,999,968)
Purchases in satisfaction of maintenance agreement (3,445)
Proceeds from capital grants 3,674,507
Proceeds from property tax 1,327,647
Principal payments on debt (4,739,437)
Proceeds of new borrowing 8,012, 154
Principal received on financing lease 133,242
Interest received on financing lease 56,204
Bond issue costs paid (75,986)
Interest paid on long-term debt (922,725)
Net Cash Provided (Used) in Capital and Related
Financing Activities
462,193
CASH FLOWS FROM INVESTING ACTIVITIES
Interest received on deposits
15,550
INCREASE (DECREASE) IN CASH
165,115
CASH BALANCE - January 1
1,871,999
CASH BALANCE - December 31
$ 2,037,114
$ 2,426,455
(790,936)
(1,475,036)
160,483
(8,663,391 )
(7,912)
1,552,002
1,256,816
(3,946,317)
122,855
66,592
(1;249,490)
(10,868,845)
125,309
(10,583,053)
12,455,052
$ 1,871,999
The Authority received capital equipment having a fair value of $98,093 in 2008 and $96,05] in 2009. This
non-cash transaction is included in CAPITAL CONTRIBUTIONS on the STATEMENT OF REVENUES,
EXPENSES AND CHANGES IN NET ASSETS and in Equipment acquisitions in Note D but it is not
included in this STATEMENT OF CASH FLOWS.
( continued)
See notes to financial statements.
27
FINANCIAL FY 2009
SALINA AIRPORT AUTHORITY
STATEMENTS OF CASH FLOWS
(DIRECT METHOD)
(continued)
RECONCILIATION OF OPERATING LOSS TO NET
CASH PROVIDED BY OPERATING ACTIVITIES
OPERA TING LOSS
ADJUSTMENTS RECONCILING OPERATING LOSS
TO NET CASH PROVIDED BY OPERATING ACTIVITIES:
Depreciation
Basis of assets sold
CHANGES IN ASSETS AND LIABILITIES:
Decrease (increase) in accounts receivable
Decrease (increase) in prepaid expense
(Increase) in inventory
(Decrease) in accounts payable - operations
Increase in accrued payroll expenses
Increase in accrued property tax and special assessments
Increase (decrease) in unearned rental income
NET CASH PROVIDED (USED) BY OPERATING ACTIVITIES
See notes to financial statements.
January 1 to December 3]
2009 2008
$(1,869,900)
$ (1,699,741)
1,748,348
1,606,811
]9,198
(123,832) 248,701
4,229 (3,026)
(2,031 )
(20,792) (43,857)
7,209 11 ,440
8,648 14,771
(64,507) 6,186
$ (312,628) $ 160,483
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FINANCIAL 1\ 2 (J(J'j
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2009
I.
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
The Salina Airport Authority was established by the City of Salina, pursuant to Chapter 27, Article 3, of
the Kansas Statutes Annotated for the purpose of acquiring surplus federal governinent property,
specifically the former Schilling Air Force Base, located near the City of Salina. The Authority operates,
maintains, and develops the Salina Municipal Airport and the Salina Airport Industrial Center. The
Authority is controlled by a five-member Board of Directors appointed by the Salina City Commission
and, in accordance with Governmental Accounting Standards Board (GASB) Statement No. 14, the
Authority is considered to be a component unit of the City of Salina. The Authority is discreetly
presented in the City's comprehensive annual financial reports.
B. Measurement Focus, Basis of Accounting and Basis of Presentation
The Authority consists of an enterprise fund. Enterprise funds are classified as proprietary funds by the
GASB and are accounted for using a total economic resource measurement focus. The enterprise fund is
used to account for operations that are financed and operated in a manner similar to private business
enterprises. The intent of the Authority is that the costs of providing services on a continuing basis be
recovered through user fees and rents. The financial statements are prepared on the accrual basis of
accounting. Under the accrual basis, revenues are recognized as earned and expenses as incurred. It is
the Authority's policy to follow all Financial Accounting Standards Board (FASB) standards issued after
November 30, 1989, for its proprietary activities unless those new FASB pronouncements conflict with
GASB guidance.
Revenues from airlines, fuel flowage fees, building and land rents, rental car commissions and the sale of
assets, related to economic development, are reported as operating revenues. Transactions, which are
capital, financing or investing related, are reported as non-operating revenues. All expenses related to
operating the Airport and Industrial Center are reported as operating expenses. Interest expense and
financing costs are reported as non-operating expenses.
C. Assets, Liabilities and Equity
1. Cash and Investments
The Authority's cash and cash equivalents are considered to be cash on hand, demand deposits and short-
term investments with original maturities of three months or less from date of acquisition. The Authority
held no investments during these years.
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FINANCIAL 1'\ 21111l)
2. Receivables
Accounts Receivable. The Authority records revenues when services are provided. All receivables are
shown net of an allowance for uncollectibles.
Property taxes receivable. The determination of assessed valuations and the collections of property
taxes for all political subdivisions in the State of Kansas is the responsibility of the various counties. The
office of the County Appraiser annually determines assessed valuations and the County Clerk spreads the
annual assessment on the tax rolls. The County Treasurer is the tax collection agent for all taxing entities
within the county. In accordance with state statutes, property taxes are levied November 1 of the current
year and are a revenue source to be used to finance the budget of the ensuing year. One-half of the
property taxes are due December 20, prior to the fiscal year for which they are budgeted, and the second
half is due the following May 10.
Collection of current year property tax by the County Treasurer is not completed, apportioned nor
distributed to the various subdivisions until the succeeding year, such procedure being in conformity with
governing state statutes. Consequently, current year property taxes receivable are not available as a
resource that can be used to finance the current year operations of the Authority. It is the Authority's
practice to record uncollected current year property tax as an account receivable and to record the same
amount as deferred revenue. It is not practicable to apportion delinquent taxes held by the County
Treasurer and, further, the amounts thereof are not material in relationship to the financial statements
taken as a whole.
3. Inventories
The Authority maintains no significant inventory of office and maintenance supplies. These items are
expensed as purchased and no inventory is recorded in these financial statements. The Authority uses the
consumption approach in valuing inventories of A vgas sold for retail. That is, the purchase is recorded
as an asset on the cost basis and the expenditure is deferred until the inventory is consumed under the
FIFO method.
4. Prepaid items
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as
prepaid items.
5. Restricted Assets
Certain proceeds of leasehold revenue bonds are classified as restricted assets on the Statement of Net
Assets because their use is limited by applicable bond covenants.
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6. Capital Contributions and Net Assets
Airport Improvement Program - Certain expenditures for airport capital improvements are
significantly funded through the Federal Aviation Administration's Airport Improvement Program (AlP),
with certain matching funds of the Authority. Capital funding provided under the AlP grant program is
considered earned as the related allowable expenditures are incurred. Grants received under the AlP
program are reported in the Statement of Revenues, Expenses and Changes in Net Assets, as non-
operating revenues and expenses as capital contributions.
Defense Reutilization Marketing Office Program - The Authority is a participant in the Defense
Reutilization Marketing Office (DRMO) program. The DRMO entity disposes of United States military
surplus property. The property is first offered for reutilization with the Department of Defense,
transferred to other federal agencies or donated to state and local governments.
The Authority's policy is to record fixed assets having a cost (or by implication fair value) in excess of
$1,000 at acquisition. The Authority's capitalization policy with respect to fixed assets is to expense
fixed assets costing $1,000 or less. Freight or other expenses necessary to put the asset into service equal
to or greater than $1,000, are capitalized.
The Authority records donated assets having an original cost of $5,000 or less at $1 in order to meet the
tracking requirement and will memo in the asset file the original cost because the Authority believes the
fair value of these is less than $1,000 each.
The Authority estimates the donated items to have a value equal to 20% of cost. Items having an original
cost ofless than $5,000 will be valued at $1 with memo of original cost. Items having an original cost of
more than $5,000 will be valued at 20% of original cost rounded to the nearest $1,000 with a memo to
the file of the original cost.
If the Authority receives reliable written information indicating this procedure has produced a value
significantly different from fair value, an adjustment to that value will be made.
Donated DRMO property with a value in excess of $1,000 is reported in the Statement of Revenues,
Expenses and Changes in Net Assets, as non-operating revenues and expenses as capital contributions.
The Federal Aviation Administration, as the oversight agency, requires that the Airport track all the
contributed property and the property must be held for at least one year prior to disposition.
7. Capital Assets
Capital assets purchased or constructed are recorded at cost. The cost of normal maintenance and repairs
that do not add to the value of the assets or materially extend assets' lives are not included in capital
assets cost. Capital assets donated to the Authority are recorded at their estimated fair value at the date
of donation. Donated assets include property and equipment transferred to the Authority from the United
States of America, September 9, 1966 and recorded at fair value at that date. The Authority maintains a
capitalization threshold of $1 ,000.
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FINANCIAL 1\ :::111 I'}
Capital assets are depreciated using the straight-line method over the following estimated useful lives:
Assets
Buildings
Equipment
Vehicles
Airfield
Years
5 -50
5 -10
7-10
10 - 30
8. Compensated Absences
Substantially all full-time employees receive compensation for vacations, holidays, illness. and certain
other qualifying absences. The number of days compensated for various categories of absence is
generally based on length of service. Liabilities relating to these absences are recognized as incurred and
included in accrued expenses. Per the Authority's compensation policy, the paid time off is not able to
accrue beyond a one year period, therefore all such liabilities are recorded as current. The amount
accrued for such liabilities at December 31, 2009 and 2008 was $53,778 and $47,350 respectively.
Balance Balance
January 1, December 31,
2009 Net Change 2009
$ 47,350 $ 6,428 $ 53,778
Balance Balance
January 1, December 31,
2008 Net Change 2008
$ 37,573 $ 9,777 $ 47,350
II.
STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
A. Cash-Basis Law (KSA 10-1113)
The Authority was in compliance with this law at all times during the year.
B. Depository Security (KSA 9-1402)
The Authority's funds were adequately secured at all times during the year.
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III.
DETAILED NOTES
A. Deposits
As of December 31, 2009 and 2008, the Authority had cash and cash equivalents as listed below:
December 31.
2009 2008
Cash Balances
Cash $ 2,037,114 $ 1,871,999
Less undeposited and petty cash (2,568) (6,034)
Add uncleared checks 3,021 165,324
Bank Balance 2,037,567 2,031,289
Less FDIC Coverage 438,647 525,148
Balances Securable by Collateral $ 1,598,920 $ 1,506,141
Security Provided by Depositories $ 9,824,013 $ 3,911,225
The Authority did not have any activity in investment-type assets.
The Authority's policies relating to deposits and investments are governed by various Kansas Statutes
(KSA). Those statutes specifY the type of deposits and investments as well as the securing of those
deposits and investments.
Interest rate risk - In accordance with Kansas Statute 12-1675, The Authority manages its exposure to
interest rate fluctuations by limiting all time investments to maturities of less than two years.
Credit risk - State law limits the amount of credit risk by restricting governments to specific investment
types as listed in KSA 12-1675. The Authority's policy is to place idle funds in certificates of deposit,
United States obligations, and the Kansas Municipal Investment Pool (KMIP). The KMIP was rated
AAAf/Sl+ by Standard & Poor's as of March 15, 2004. The KMIP is permitted to invest in fully
collateralized certificates of deposit, certain obligations of the United States, certain repurchase/reverse
repurchase agreements, and other types of investments. Maturity information released by the KMIP at
September 30, 2005 showed that the investment pool consisted of investment with a maturity date of 365
days or less.
Custodial credit risk - The Custodial credit risk for deposits is the risk that, in the event of the failure of
a depository financial institution, a government will not be able to recover deposits or will not be able to
recover collateral securities that are in the possession of an outside party. The custodial credit risk for
investments is the risk that, in the event of the failure of the counterparty to a transaction, a government
will not be able to recover the value of investment or collateral securities that are in the possession of an
outside party. Kansas Statutes 9-1402 and 9-1405 require that governments obtain security for all
deposits. The Authority manages its custodial credit risk by requiring the financial institutions to grant a
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security interest in securities held by third-party custodial banks. Monies in the Kansas Municipal
Investment Pool are not required to have pledged securities.
Concentration of credit risk - This is the risk of loss attributed to the magnitude of a government's
investment in a single issuer. The Authority manages this risk by placing funds with financial
institutions only after contacting all eligible institutions in the taxing area and monies in the Kansas
Municipal Investment Pool are diverse according to the policies of the investment pool.
B. Receivables
Receivables as of year-end, including the applicable allowance for uncollectible accounts, are as follows:
December 31,
2009 2008
Receivables
Accounts $ 193,854 $ 69,410
Less: allowance for uncollectibles ( 696) (84)
193,158 69,326
Taxes 1,849,957 1,281,413
Totals $ 2,043,115 $ 1,350,739
C. Net Investment in Financing Lease
Net investment in financing lease is as follows:
December 31,
2009 2008
Total lease payments receivable
Less: unearned income
Net investment in financing lease
$ 348,892
(39,011)
$ 309,881
$ 568,338
(125,215)
$ 443,123
Activity in net investment in financing leases was as follows:
Beginning Balance
Less: Collected principal
Ending Balance
December 31,
2009 2008
$ 443,123 $ 565,978
(133,242) (122,855)
$ 309,881 $ 443,123
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FINANCIAL 1\ :'I)(j()
D. Capital Assets
The following is a summary of the changes in capital assets during the current and preceding year:
Balance Balance
January 1, December 31,
2009 Additions Dispositions Reclassifv 2009
Capital Assets
Non-Depreciable
Land $ 9,675,911 $ 366,106 $ 3,920 $ 10,045,937
Construction in progress 8,821,320 2,584,100 (180,328) 11,225,092
Total Non-Depreciable 18,497,231 2,950,206 (176,408) 21,271,029
Depreciable
Buildings and improvements 14,276,411 1,088,374 79,516 15,444,301
Airfield and improvements 26,681,124 2,759,561 $ 96,893 29,537,578
Equipment 3,245,380 161,709 3,407,089
Total Depreciable 44,202,915 4,009,644 176,409 48,388,968
Total Non-Depreciable &
Depreciable $ 62,700,146 $ 6,959,850 $ $ $ 69,659,997
Accumulated depreciation
Buildings and improvements $ (5,062,636) (562,008) $ (5,624,644)
Airfield and improvements (13,379,144) (937,187) (14,316,331)
Equipment (1,695,586) (249,153) (1,944,739)
Total Accumulated
Depreciation (20,137,366) (1,748,348) (21,885,714)
Total Capital Assets $ 42,562,780 $ 5,211,502 $ $ $ 47,774,283
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FINANCIAL I" ::'()()l)
Balance Balance
January 1, December 31,
2008 Additions Dispositions Reclassifv 2008
Capital Assets
Non-Depreciable
Land $ 8,961,999 $ 713,912 $ 9,675,911
Construction in progress 2,232,408 7,539,694 (950,782) 8,821,320
Total Non-Depreciable 11,194,407 8,253,606 (950,782) 18,497,231
Depreciable
Buildings and improvements 13,719,216 155,637 401,558 14,276,411
Airfield and improvements 25,793,670 338,230 549,225 26,681,124
Equipment 3,096,442 226,087 (77,149) 3,245,380
Total Depreciable 42,609,328 719,954 (77,149) 950,782 44,202,915
Total Non-Depreciable &
Depreciable $ 53,803,735 $ 8,973,560 $ (77,149) $ $ 62,700,146
Accumulated depreciation
Buildings and improvements $ (4,550,753) (511,883) $ (5,062,636)
Airfield and improvements (12,510,286) (868,858) (13,379,144)
Equipment (1,527,467) (226,070) 57,951 (1,695,586)
Total Accumulated
Depreciation (18,588,506) (1,606,811) 57,951 (20,137,366)
Total Capital Assets $ 35,215,229 $ 7,366,749 $ (19,198) $ $ 42,562,780
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FINANCIAL 11 2011'J
E. Long-Term Liabilities
Following is a summary of changes in long-term liabilities during the current and preceding years:
Current
Balance Balance Maturities
January 1, December 31, December 31,
2009 Additions Reductions 2009 2009
Long-term Liabilities
General obligation bonds $ 6,525,000 $ 8,012,154 $ 755,000 $ 13,782,154 $ 990,000
Financing Lease payable 358,831 35,331 323,500 37,705
Special assessment debt 232,054 24,106 207,948 25,028
General obligation
temporary notes 10,975,000 3,925,000 7,050,000 7,050,000
Total Long-Term Liabilities $ 18,090,885 $ 8,012,154 $ 4,739,437 $ 21,363,602 $ 8,102,733
Current Maturities (814,437) (8,102,733)
Long Term Liability Net $ 17,276,448 $ 13,260,869
Current
Balance Balance Maturities
January 1, December 31, December 31,
2008 Additions Reductions 2008 2008
Long-term Liabilities
General obligation bonds $ 7,490,000 $ 965,000 $ 6,525,000 $ 755,000
Financing Lease payable 391,932 33,101 358,831 35,331
Special assessment debt 255,270 23,216 232,054 24,106
General obligation
temporary notes 13,900,000 2,925,000 10,975,000
Total Long-Term Liabilities $ 22,037,202 $ $ 3,946,317 $ 18,090,885 $ 814,437
Current Maturities (1,021,323) (814,437)
Long Term Liability Net $ 21,015,879 $ 17,276,448
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Interest Rates Bonds Outstandine
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The following is a detailed listing of the Authority's long-term debt including general obligation bonds,
temporary notes, financing lease and special assessment debt at December 31,2009:
Financing Lease, due December 2016 425,000 6.609% 323,500
Special Assessment Debt
Airport Industrial Center, due 2016 565,235 3.79% 184,523
Hangar 600 Sanitary Sewer, due 2021 27,599 4.47% 23,425
Total Special Assessment Debt 207,948
Total Long Term Debt $ 21,363,602
Interest Expense in 2009 is as follows:
General Obligation Bonds 481,513
Special Assessment Debt 8,964
Financing Lease 22,363
Temporary Notes 474,539
987,379
Add: Amortization of bond costs 26,750
Total Debt Interest Expense $ 1,014,129
General Obligation Bonds
General Obligation 1999-B, due 2010
General Obligation 2001-A, due 2012
General Obligation 2002-A, due 2012
General Obligation 2005-A, due 2020
General Obligation 2007-A, due 2022
General Obligation 2009,:A, due 2029
General Obligation 2009-B, due 2026
Total General Obligation Debt
General Obligation Temporary Notes
2007-1, due 2010
Orieinal Issue
$ 555,000
1,385,000
2,635,000
3,635,000
1,005,000
2,025,000
6,080,000
10,975,000
3.90% to 5.20%
4.45% to 5.60%
2.45% to 3.70%
4.75% to 5.25%
4.60% to 6.00%
4.20% to 4.25%
3.00% to 5.50%
$ 70,000
500,000
885,000
3,415,000
900,000
1,932,154
6,080,000
13,782,154
5.60%
7,050,000
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Annual debt service requirements to maturity for general obligation bonds to be paid with tax levies and
rental revenues:
Bonds
Year Outstandine: Interest Due Total
2010 990,000 723,614 1,713,614
2011 1,040,000 592,272 1,632,272
2012 1,090,000 548,424 1,638,424
2013 635,000 501,950 1,136,950
2014 665,000 475,503 1,140,503
2015-2019 3,805,000 1,914,865 5,719,865
2020-2024 2,855,000 1,040,500 3,895,500
2025-2029 2,795,000 379,240 3,174,240
$ 13,875,000 $ 6,176,368 $ 20,051,368
Annual debt service requirements for General Obligation Temporary Notes payable from general
obligation bonds and capitalized interest funds:
Year
2010
Notes
Outstandine:
7,050,000
Total
7,444,800
Interest Due
394,800
Annual debt service requirements for Financing Lease payable rental revenues:
Year Principal Due Interest Due Total
2010 37,705 20,767 58,472
2011 40,238 18,234 58,472
2012 42,941 15,531 58,472
2013 45,826 12,646 58,472
2014 48,905 9,567 58,472
2015-2016 107,886 9,058 116,944
$ 323,501 $ 85,803 $ 409,304
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Annual debt service requirement to maturity for Special Assessment Debt to be paid from rental revenue:
Year Loan Principal Interest Due Total
2010 25,029 8,041 33,070
2011 25,988 7,082 33,070
2012 26,984 6,086 33,070
2013 28,018 5,052 33,070
2014 29,091 3,978 33,069
2015-2019 68,033 5,800 73,833
2020-2021 4,805 325 5,130
$ 207,948 $ 36,364 $ 244,312
F. Capital Contributions and Net Assets
Since its inception, the Authority has received capital contributions through Federal and State grants as
follows:
Inception to
Date 2009 2008
Federal $ 25,877,678 $3,120,218 $ 1,650,041
State 1.515,610 500,000
Total $27.393.288 $3.620.218 $ 1.650.041
The Authority has designated $90,000 to be used as an insurance increase reserve or to accelerate future
debt service payments. As of December 31,2009, the reserve had been funded but not used.
IV.
OTHER INFORMATION
A. Defined Benefit Pension Plan
Plan description - The Authority participates in the Kansas Public Employees Retirement System
(KPERS). The plan is a cost-sharing multiple-employer defined benefit pension plan as provided by
Kansas statutes (KSA 74-4901 et seq). KPERS provides retirement benefits, life insurance, disability
income benefits and death benefits. Kansas law establishes and amends benefit provisions. KPERS
issues a publicly available financial report that includes financial statements and required supplementary
information. Those reports may be obtained by writing to KPERS (611 S. Kansas Avenue, Suite 100,
Topeka, Kansas 66603-3803) or by calling 1 (888) 275-5737
Funding policy - KSA 74-4919 establishes the KPERS member-employee contribution rate at 4% of
covered salary. The employer collects and remits member-employee contributions according to the
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provision of section 414(h) of the Internal Revenue Code. State law provides that the employer
contribution rates be determined annually based on the results of an annual actuarial valuation. KPERS is
funded on an actuarial reserve basis. State law sets a limitation on annual increases in the employer
contribution rates. The KPERS employer rate established for calendar year 2009 was 6.53%. The
Authority employer contributions to KPERS for the years ending December 31, 2009, 2008 and 2007
were $52,641 $45,687 and $27,612 respectively, equal to the required contributions for each year.
B. Deferred Compensation Plan
The Authority offers its employees a deferred compensation plan ("Plan") created in accordance with
Internal Revenue Code Section 457. The Plan, available to all Authority employees, permits them to
defer a portion of their salary until future years. The deferred compensation is not available to
employees until termination, retirement, death, or unforeseeable emergency. Plan assets are transferred
to a plan agent in a custodial trust and are not available to the claims of the Authority's general creditors.
C. Flexible Benefit Plan (I.R.C. Section 125)
The Authority has adopted by resolution a salary-reduction flexible benefit plan ("Plan") under Section
125 of the Internal Revenue Code. All Authority employees working more than 20 hours per week are
eligible to participate in the Plan beginning after thirty days of employment. Each participant may elect
to reduce his or her salary to purchase benefits offered through the Plan. Benefits offered through the
Plan include various insurance and disability benefits.
D. Risk Management
The Authority is exposed to various levels of loss related to torts; theft of, damage to, and destruction of
assets; errors and omissions; injuries to employees; and natural disasters.
There has been no significant reduction in the Authority's insurance coverage from the previous year. In
addition, there have not been settlements in excess of the Authority's coverage in any of the prior three
years.
E. Contingent Liabilities
The Authority receives significant financial assistance from numerous federal and state governmental
agencies in the form of grants and state pass-through aid. The disbursement of funds received under
these programs generally requires compliance with terms and conditions specified in the grant
agreements and is subject to audit. Any disallowed claims resulting from such audits could become a
liability of the Authority. However, in the opinion of management, any such disallowed claims would
not have a material effect on any of the financial statements of the Authority at December 31, 2009.
F. Other postemployment benefits (OPEB)
As a component unit of the City of Salina, the Authority participates in the City's defined benefit
health care plan that is administered by the City. The Employee Benefit Plan (the Plan) provides medical
and dental benefits to eligible early retirees and their spouses. KSA 12-5040 requires all local
governmental entities in the state that provide a group health care plan to make participation available to
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all retirees and dependents until the retiree reaches the age of 65 years. No separate financial report is
issued for the Plan.
The OPEB cost, actuarial valuations of the ongoing plan and net OPEB obligations for the Authority as a
sub-group of the plan, are calculated and recorded in the City's CAFR.
G. Environmental Matter
The U.S. Department of Defense transferred property located at the former Schilling Air Force Base to
the Authority on or about September 9, 1966. The property is now known to contain areas of extensive
soil and groundwater contamination, as a result of the use and disposal of chlorinated solvents during
military operations at the former base during its period of active military duty from 1942 to 1965.
The U.S. Department of Defense is responsible for the investigation and remediation of contamination
caused by military activities at current and former military bases. The U.S. Army Corps of Engineers
(USACE) is the lead agency for the Department at formerly used defense sites. The Corps has
investigated the soil and groundwater contamination at the former base under the regulatory oversight of
the U.S. Environmental Protection Agency and the Kansas Department of Health and Environment. The
former base is not designated as a National Priority List Superfund site, but investigation and
remediation is required to be in compliance with the Comprehensive Environmental Response,
Compensation and Liability Act.
Potential liability for contamination under the Act extends broadly to parties associated with the release
or presence of hazardous substances, including not only those entities involved with contaminant use and
disposal, but in some cases other current and former owners and operators of contaminated sites. As a
current owner of extensive amounts of property at the former base, the Authority is potentially liable
under the act although the Authority believes that it has defenses to such liability.
Based on presently known information, the Authority has determined that while a possible liability
exists, it is not probable and at this time no reasonable estimate of the possible liability can be made.
Therefore, no liability relating to that matter has been recorded. The Authority is under no
administrative orders from the U.S. Environmental Protection Agency or the Kansas Department of
Health and Environment. The Authority is considered to be a Potentially Responsible Party for the
former base site, primarily due to its status as a property owner. The Salina Airport Authority, City of
Salina, Unified School District No. 305 and the Kansas Board of Regents (Kansas State University at
Salina) collectively own over 90% of the nearly 4,000 acres of the former Schilling Air Force Base
property.
Beginning in August 2007, the four local public entities including the Salina Airport Authority, the City
of Salina, the Salina School District and Kansas State University at Salina initiated negotiations with the
U.S. Federal Government. The negotiation objectives include transferring the responsibility for
completing the cleanup from the USACE to the Salina Public Entities. The local objective is to reach a
settlement agreement with the United States of America that provides the Salina Public Entities sufficient
funds to complete cleanup operations over a 30-year period.
During calendar year 2008, the Salina Public Entities prepared a detailed Cost to Complete Estimate
(CTC). The CTC preparation included consultation with the EP A and KDHE. The Salina Public
Entities' CTC was completed in June of2008 and submitted to the USACE.
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Subsequently, on January 23,2009, the Salina Public Entities delivered a demand letter to the USACE.
The letter demands that settlement negotiations begin immediately with the U.S. Department of Justice.
On May 14, 2009 the Authority was notified that the USACE referred the former SAFB demand letter to
the u.S. Department of Justice on May 12,2009.
The current status is that the Salina Public Entities delivered on or about May 7, 2010, a settlement offer
and a draft of a lawsuit complaint to the attorney for the U.S. Department of Justice. The Salina Public
Entities filed suit against the United States on May 27, 2010. The suit was filed for several reasons but
primarily to avoid a potential statute of limitations issue. The Salina Public Entities do not intend to cut
off settlement negotiations by the filing of suit, and this has been communicated to the United States.
The goal is for the parties to reach agreement on a settlement Consent Decree that will specify terms,
conditions and funding enabling the Salina Public Entities to proceed with site clean-up operations.
H. Rental Income Under Operating Leases
A significant portion of the operating revenue of the Authority is generated through the leasing of
airport and building space to airport fixed base operators and others on a fixed fee as well as a contingent
rental basis. Ownership risks are retained by the Authority, and accordingly, such leases are treated as
operating leases.
The following is a schedule of minimum future rentals on non-cancellable operating leases to be received
in each of the next five years and thereafter:
Years Ended
December 31
2010
2011
2012
2013
2014
Later Years
Total
725,316
827,478
612,994
569,467
429,672
662,598
$ 4,606,347
I. Major Customers
The Authority receives significant operating and financing lease revenue from Hawker Beechcraft
Corporation, Kansas State University-Salina, Flower Aviation, America Jet, CA V Aerospace, and the
Kansas National Guard. Rent from these six tenants equals 60% of operating and capital lease revenue
for the year ended December 31, 2009.
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J. Non-Operating Income and (Expense)
Net non-operating income and expense consisted of the following for the years ended December 31,
2009 and 2008:
Mill Levy
Interest and investment income
Financing lease
Other interest
December 31.
2009 2008
$ 1,327,647 $ 1,256,816
Total
58,763
15,550
$ 1,401,960
59,906
125,309
$ 1,442,031
Interest expense
General obligation bonds $ (481,513) $ (292,886)
Special assessment debt (8,964 ) (9,854)
Financing lease (22,363) (24,636)
Temporary notes (474,539) (669,609)
Amortization of bond issue costs (26,750) (25,554)
Total (1,014,129) (1,022,539)
Net non-operating income $ 387,831 $ 419,492
K. Commitment Under Operating Lease
The Authority has entered into a certain non-cancellable operating lease agreement which will expire in
2013, for the rental of office equipment. Minimum rentals, on an annual basis are as follows:
Years Ended
December 31
2010
2011
2012
2013
Total
11,400
11,400
11 ,400
1,900
$ 36,100
L. Subsequent Events
The Salina Airport Authority's management has evaluated events and transactions occurring after
December 31,2009 through June 3, 2010. The aforementioned date represents the date the financial
statements were available to be issued.
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The Wildcats of the Women in Aviation, International K-State at
Salina chapter held a "Plane Wax Weekend" fundraiser, in November
at the Salina Airport Authority's Hangar 600.
During the weekend fundraiser, pilots enjoyed a five cent per gallon
discount, at the newly opened self-fueling station. Major credit and
branded debit cards are accepted for payment at the pump.
Women in Aviation, International is a nonprofit organization which
encourages the advancement of women who are striving for
challenging and fulfilling careers in the aviation and aerospace
industries.
"
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SALINAAirport
=,t/~=
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(THIS PAGE rNTENTlONALL Y LEFT BLANK)
SUPPLEMENTAL FY 2009
SALINA AIRPORT AUTHORITY
SCHEDULES OF REVENUES, EXPENSES AND CHANGES
IN NET ASSETS
January 1 to December 31
2009 2008
OPERATING REVENUES
Airfield
Fuel flowage fees
Hangar rent
Landing fees
Ramp rent
Total Airfield
$ 165,443
388,781
8,445
104,966
667,635
$ 210,292
383,667
7,789
78,726
680,474
Building and land rent
Agri land rent
Building rents
Land rents
Tank rent
Total Building and Land Rents
58,788
1,097,387
237,695
8,361
1,402,231
72,567
1,094,135
231,036
10,246
1,407,984
Gain on sale of assets
16,321
Other revenue
ARFF training
Commissions
Sale of A vgas
Less Cost of A vgas
Othe'r income
Total Other Revenue
7,935
19,554
6,650
17,603
3,364
(3,146)
4,239
28,710
20,102
47,591
Total Operating Revenue
2,098,576
2,152,370
(continued)
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SUPPLEMENTAL FY 2008
SALINA AIRPORT AUTHORITY
SCHEDULES OF REVENUES, EXPENSES AND CHANGES
IN NET ASSETS
January 1 to December 31
2009 2008
OPERATING EXPENSES
Administrative
AlE, consultants, brokers
Airport promotion
Computer network administration
Dues and subscriptions
Employee retirement
FICA and medicare
Industrial development
Insurance, property
Insurance, medical
Kansas unemployment tax
Legal and accounting
Office salaries
Office supplies
Other administrative
Postage
Property appraisals
Property taxes
Special events
Telephone
Travel and meetings
61,432
27,818
14,630
34,374
52,641
61,772
30,000
160,069
205,017
581
34,059
443,768
9,082
14,459
3,803
154,500
3,427
20,073
20,852
Total Administrative Expenses
1,352,357
( continued)
61,975
34,241
22,455
27,503
45,687
59,262
30,000
151,138
183,649
784
35,767
398,236
10,863
25,161
4,573
3,300
119,426
52,822
13,515
23,017
1,303,374
46
SUPPLEMENTAL FY 2009
SALINA AIRPORT AUTHORITY
SCHEDULES OF REVENUES, EXPENSES AND CHANGES
IN NET ASSETS
(continued)
MAINTENANCE EXPENSES
Airfield maintenance
Airport security
Building maintenance
Equipment fuel and repairs
Fire services
Grounds maintenance
Maintenance salaries
Other maintenance expenses
Snow removal expense
Utilities
January 1 to December 31
2009 2008
50,518 30,5]9
(988) 4,796
48,474 1 16,297
105,174 123,425
31,084 12,600
2,298 ] 4, 152
393,739 404,140
22,786 25,132
15, 105 17,172
199,58] 193,693
867,771 941,926
2,220,128 2,245,300
(121,552) (92,930)
1,748,348 1,606,811
(1,869,900) (1,699,741)
1,327,647 1,256,816
58,763 59,906
15,550 125,309
(987,379) (996,985)
(26,750) (25,554)
387,831 419,492
(1,482,069) (1,280,249)
3,770,558 1,650,041
2,288,489 369,792
25,776,818 25,407,026
$28,065,307 $25,776,818
Total Maintenance Expenses
Total Operating Expenses
OPERA TING lNCOME BEFORE DEPRECIATION
DEPRECIA TION EXPENSE
OPERA TING LOSS
NON-OPERATING INCOME (EXPENSE)
Mill levy
Interest income-capital lease
Interest income
Interest expense
Amortization of bond costs
Tota] Non-Operating Income (Expense)
LOSS BEFORE CAPITAL CONTRIBUTION
CAPIT AL CONTRIBUTIONS
lNCREASE IN NET ASSETS
NET ASSETS, January 1
NET ASSETS, December 31
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SUPPLEMENTAL FY 2009
SALINA AIRPORT AUTHORITY
CAPIT AL EXPENDITURES
January I to December 31
2009
AIRPORT IMPROVEMENTS
ASC Vehicle Traffic Study
AIP-28 Txy. Rehab Contr. Ph 1
AIP-29 Txy. Rehab. Const. Ph. 2
AIP-30 Txy. Rehab. (PS&E)
AIP-32 North GA Connector-ARRA
Heave repair
Rwy 17-35(N 4800') Pvmt. Rehab.
Rwy 17/35 Pvmt Removal AlE
AlE Services (helipad siting & update to ALP)
Demolition Bldg. 1] 03 & 1088
Total Airport Improvements
8,993
146,093
684,202
52,]00
721,678
12,30]
1,099,642
9,550
6,885
18,117
2,759,561
BUILDINGS
Bldg. #207 SAA MX Design
Hangar # 603-Bldg. Design
Bldg. 824 Environmental assesment
Bldg. 824 Duro-last roofing
Bldg. 498 Duro-last roofing
Pumphouse 305 cleaning & lining of 4 tanks
Hangar 409 Improvements
Pumphouse #305
Term. Bldg. 120 domestic water filtering $ heating
Term. Bldg. 120 electrical improvments
Bldg. 394 Duro-last roofing
Bldg. 313 Duro-last roofing
Bldg. 120 Duro-last roofing
Bldg. 1080 & L8B I S6 Acq.
Bldg. 1021 Conklin roofing
Bldg. 1021 Duro-last roofing
Total Buildings
11,200
324,817
1,730
28,000
51,000
112,854
270,506
35,880
9,145
1,573
31,273
56,000
86,600
36,286
16,810
14,700
1,088,374
(continued)
48
SUPPLEMENTAL FY 2009
SALINA AIRPORT AUTHORITY
CAPIT AL EXPENDITURES
( continued)
January 1 to December 31
2009
EQUIPMENT
Computer software - Authority admin
Term. B120-Video survellance cameras & system
HPDC Notebook computer
Avionics Travsceiver (DRMO truckmount)
1 Graco Lindriver airfield paint machines
2- Yanmar 5500 Watt Diesel generators
2009 John Deere 61000 tractor
Truck Lift Fork (6K) - orange
Semitrailer, Van
Truck, Lift, Fork (4K) - yellow
Tractor, wheeled (tow vehicle, green)
Maintenance platform (ac/ms B-1 stands, yellow)
Semi-trailer, low bed (green)
Truck, van (diesel - I cyl, van/hilift body)
Crance, wheel mounted
Tractor, wheeled, Air (Bobtail) Tug
Other Misc. DRMO Equipment
Total Equipment
9,895
2,752
1,104
1,239
9,078
6,730
34,860
7,000
6,000
2,000
5,000
5,000
2,000
9,000
12,000
3,000
45,051
161,709.00
CONSTRUCTION IN PROGRESS
AIP-31 Txy. Alpha Rehab. Ph. 3 of 3
1,881,888
468,548
11,407
103,619
41,859
22,080
21,772
20,790
671
9,789
1,677
2,584,100
AIP-33 AlE ARFF Station
Bldg. No. 412 Imps.
Bldg. 703 Conklin roofing system
Bldg. 730 Conklin roofing system
Hangar 600-B1dg Construction
Hangar 600-Civil Engeering
Hangar 600-0ther
Hangar 600-Civil Construction
Hangar 600-Architectural
Total Construction in Progress
LAND
Environmental-SAFB
KS ARNG RSMS Expansion tract fencing
Total Land
351,910
14,196
366,106
TOTAL CAPITAL EXPENDITURES
$ 6,959,850.00
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SUPPLEMENTAL FY 2009
Date of isue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGA nON REFUNDING BONDS
SERIES J 999 - B
December 31, 2009
Schedule of Bond Interest and Principal Payments
Due in
Year
Bond
Interest
2010
3,640
$ 3,640
June 29, J 999
$ 555,000
3.90% to 5.20%
September I, 20 J 0
$ 485,000
$ 70,000
Bond
Principal
70,000
$ 70,000
50
SUPPLEMENTAL FY 2009
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGATION IMPROVEMENT BONDS
SERIES 2001 - A
December 31, 2009
Schedule of Bond Interest and Principal Payments
October 3 1, 2001
$ 1,385,000
4.45% to 5.60%
September I, 2012
$ 885,000
$ 500,000
Due in Bond Bond
Year Interest Principal
2010 27,514 160,000
2011 18,867 165,000
2012 9,800 175,000
$ 56,181 $ 500,000
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SUPPLEMENTAL FY 2009
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGA nON IMPROVEMENT BONDS
SERIES 2002 - A
December 31, 2009
Schedule of Bond Interest and Principal Payments
August 29, 2002
$ 2,635,000
2.45% to 3.70%
September I, 20 12
$ 1,750,000
$ 885,000
Due in Bond Bond
Year Interest Principal
2010 31,880 285,000
2011 21,905 295,000
2012 11,285 305,000
$ 65,070 $ 885,000
52
SUPPLEMENTAL FY 2009
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGA nON IMPROVEMENT BONDS
SERIES 2005 - A
December 31, 2009
August I, 2005
$ 3,635,000
4.75% to 5.25%
September I, 2020
$ 220,000
$ 3,415,000
Schedule of Bond Interest and Principal Payments
Due in Bond Bond
Year Interest Principal
2010 173,124 235,000
2011 160,787 245,000
2012 147,926 260,000
2013 134,275 275,000
2014 119,838 290,000
2015-2020 383,362 2,110,000
$ 1,119,312 $ 3,415,000
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SUPPLEMENTAL FY 2009
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGA nON IMPROVEMENT BONDS
SERIES 2007-A
December 31, 2009
December 15,2007
$ J ,005,000
4.6% to 6.0%
September 1, 2022
$ 105,000
$ 900,000
Schedule of Bond Interest and PrincipaJ Payments
Due in Bond Bond
Year Interest PrincipaJ
2010 45,990 50,000
2011 43,240 50,000
2012 40,490 55,000
2013 37,603 55,000
2014 34,743 60,000
2015-2022 156,140 630,000
$358,206 $ 900,000
54
SUPPLEMENTAL FY 2009
SALINA AIRPORT AUTHORITY
TAXABLE GENERAL OBLIGA nON TEMPORARY NOTES
SERIES 2007-]
December 3 ], 2009
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
Schedule of Bond Interest and Principal Payments
Due in
Year
Bond
Interest
20]0
6]4,600
$
614,600
September ],2007
$ 10,975,000
5.6%
September 1, 2010
$ 3,925,000
$ 7,050,000
Bond
Principal
7,050,000
$ 7,050,000
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SUPPLEMENTAL FY 2009
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBUGA nON BONDS
SERIES 2009-A
December 31 , 2009
Schedule of Bond Interest and Principal Payments
Due in
Year
2010
20]]
20]2
2013
2014
2015-2029
Bond
Interest
107,059
85,648
85,648
85,648
85,648
1,178,790
$ ],628,439
June 1, 2009
$ 2,025,000
4.31 %
September 1, 2029
$
$ 2,025,000
Bond
Principal
2,025,000
$ 2,025,000
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SUPPLEMENTAL FY 2009
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
TAXABLE GENERAL OBLIGATION BONDS
SERIES 2009-B
December 31,2009
June I, 2009
$ 6,080,000
4.998%
September 1, 2026
$
$ 6,080,000
Schedule of Bond Interest and Principal Payments
Due in Bond Bond
Year Interest Principal
2010 334,406 190,000
2011 261,825 285,000
2012 253,275 295,000
2013 244,425 305,000
2014 235,275 3] 5,000
20] 5-2026 1,616,313 4,690,000
$ 2,945,519 $ 6,080,000
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SUPPLEMENTAL FY 2009
SALINA AIRPORT AUTHORITY
SPECIAL ASSESSMENT DEBT -STREET AND UTILITY IMPROVEMENT
Airport Industrial Center Subdivision
December 3 I , 2009
Date of loan:
Amount of loan:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
September I I, 2002
$ 344,202
3.79%
October I, 20 16
$ 159,678
$ 184,524
Schedule of Loan Interest and Principal Payments
Due in Loan Loan
Year Interest Principal
2010 6,994 23,512
2011 6,102 24.403
2012 5,178 25,328
2013 4,218 26,288
2014 3,221 27,284
2015-2017 3,301 57,709
$ 29,014 $ 184,524
58
SUPPLEMENTAL FY 2009
SALINA AIRPORT AUTHORITY
SPECIAL ASSESSMENT DEBT-SANITARY SEWER EXTENSION
HANGAR 600
December 31, 2009
Date of loan:
Amount of loan:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
April 23, 2007
$ 27,599
4.47%
December 20, 2021
$ 4,174
$ 23,425
Schedule of Loan [nterest and Principal Payments
Due in Loan Loan
Year [nterest Principal
2010 1,047 1,517
2011 979 1,585
2012 908 1,656
2013 834 1,730
2014 757 1,808
2015-2022 2,823 15,128
$ 7.349 $ 23,425
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SUPPLEMENTAL FY 2009
Date of loan:
Amount of loan:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
FINANCING LEASE PA Y ABLE
December 3 I, 2009
September 28, 2006
$ 425,000
6.609%
September J, 2016
$ 101,500
$ 323,500
Schedule of Loan Interest and Principal Payments
Due in Loan Loan
Year Interest Principal
2010 20,767 37,704
201 ] 18,234 40,238
2012 15,531 42,941
2013 12,646 45,826
2014 9,567 48,905
2015-2016 9,058 107,886
$ 85,803 $ 323,500
60
SUPPLEMENTAL FY 2009
SALINA AIRPORT AUTHORITY
INSURANCE IN FORCE
December 31, 2009
Insurance Policv
Tvpe of Coverae:e
Employers Insurance of Wausau
on behalf of USAIG
Pol. #WCC-Z91-547496-0 19
Workmen's Compensation
and Employer's Liability
National Union Fire Ins. Co. of
Pittsburgh, P A
PoL #AP3229456-15
Bodily Injury & Liability
Hangar Keepers
Chubb Group of Insurance Companies
PoL 3581-68-04 KCO
Deluxe Property-Buildings, business personal
property and equipment breakdown (including
boiler and machinery)
Business Income
Pol. #(09) 7353-33-80
Vehicles & Equipment
Liability
Medical payments
Uninsured motorists
PoL #3581-68-04 KCO
Inland Marine - Equipment
ITT Hartford
PoL #37BPEAG4896
Crime Policy
Employee theft - per employee
Houston Casualty Company
PoL H709-30006
Amount of
Coverage
$ 500,000
$ 1,000,000
$ 500,000
$28,793,138
$ 1,765,779
$ 1,000,000
$ 5,000
$ 1,000,000
$ 2282,557
$ 100,000
Public Officials and Employment Practices Liability
Each wrongful act $ 2,000,000
Aggregate limit $ 2,000,000
Great American Alliance Ins. Co.
Pol. # KST 788-29-33-15
Kansas Underground Storage Tank Liability
Environmental Incident
Annual aggregate
Limit of defense
American Safety Insurance
Pol. # 179EO 1178-09-0 1
Storage Tank Pollution Liability Coverage
Per confirmed release limit
Policy aggregate limit
Limit of defence
Indian Harbor Insurance Company
Pol. #LEI9517027-01
Law Enforcement Professional Liability
Each occurrence
Annual aggregate
$ 1,000,000
$ 1,000,000
$ 100,000
$ 1,000,000
$ 1,000,000
$ 250.000
$ 1,000,000
$ 1,000,000
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A
( '\
The Hawgsmoke Scholarship Committee awarded three scholarships
to area students in November at the Salina Airport Authority's M.J.
Kennedy Air Terminal Building.
Baker University nursing student, Jenny Baxa and K-State at Salina
professional pilot student, Michael Warren were each awarded $500
and K -State at Salina professional pilot student, Travis Altenhofen
was awarded $400 to aid them in their academic careers.
The Salina community was so eager and generous with their
contributions to help host the biennial A-I0 bombing competition,
the 442nd Fighter Wing and 303rd Fighter Squadron from Whiteman
Air Force Base dedicated the $1400 in left over contributions to a
scholarship for students whose parents are or were serving in the
military or students in an aviation program.
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'-------------------------------
SA LINAAirport
=~~=
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S I ^ rIS IIC^L 11 2()(j')
STATISTICAL
Table of Contents
Total Annual Revenues, Expenses and Changes in Net Assets History ............ 63-64
Change in Cash and Cash Equivalents History .................................................. 65-66
General Obligation Debt Service Coverage ....................................................... 67
Capital Expenditure History.................................................... ............. .............. 68
Revenue Bond Coverage........... ........................................ ................................. 69
Local Government Mill Levy Rates, Direct and Overlapping ...........................70
Principal Customers.......... .................................. ................................... ........ ..... 71
Mill Levy Revenue...... ........... ............................................... ............................. 72
Air Traffic, Fuel Flowage, and Enplanement Trends ......................................... 73
Major Employers ........................... ............... ............... ....................... ................ 74
Saline County Population and Demographic Statistics ...................................... 75
Saline County Employment Data ....................................................................... 76
62
STATISTICAL FY 2000
SALINA AIRPORT AUTHORITY
TOTAL ANNUAL REVENUES, EXPENSES AND CHANGES IN NET ASSETS
FOR YEARS ENDED DECEMBER 31,
2000 2001 2002
TOT AL REVENUES
OPERATING REVENUES
Airfield 12,133 7,250 4,514
Fuel flowage fees 263,264 252,942 278,948
Building and land rent 1 , 121 , 194 1,111,662 1,034,989
Gain (loss) on sale of assets 222,664 86,719 29,455
Other revenue 25,992 33,162 39,173
TOTAL OPERATING REVENUES 1,645,247 1,491,735 1,387,079
TOTAL EXPENSES
OPERATING EXPENSES
Administrative 740,530 754,003 751,734
Maintenance 386,095 448,189 430,530
TOT AL OPERATING EXPENSES 1,126,625 1,202,192 I ,182,264
OPERA TING INCOME BEFORE DEPRECIATION 518,622 289,543 204,815
DEPRECIATION 906,198 934,270 974,140
OPERATING LOSS (387,576) (644,727) (769,325)
NON-OPERATING INCOME AND (EXPENSES)
Mill levy 801,237 795,404 817,499
Interest on investments and financing lease 163,512 145,447 147,763
Interest expense (276,092) (249,959) (319,167)
TOTAL NON-OPERATING INCOME AND (EXPENSES) 688,657 690,892 646,095
INCOME (LOSS) BEFORE CAPITAL CONTRIBUTIONS 301,081 46,165 (123,230)
CAPITAL CONTRIBUTIONS 583,134 583,135 144,005
NET ASSETS
Increase in Net Assets 884,215 629,300 20,775
TOTAL NET ASSETS, beginning of year 18,224,183 19,108,398 19,737,698
TOTAL NET ASSETS, end of year $19,108,398 $19,737,698 $19,758,473
* 1999-2002 has been restated to conform to the new financial reporting model as required by the
provisions of GASB No. 34. The SAA implemented the new model in 2003.
63
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STATISTICAL fV 2009
SALINA AIRPORT AUTHORITY
TOTAL ANNUAL REVENUES, EXPENSES AND CHANGES IN NET ASSETS
FOR YEARS ENDED DECEMBER 3[,
2003 2004 2005 2006 2007 2008 2009
190,367 204,310 237,506 263,524 376,553 470,182 502,193
257,475 235,362 259,981 247,740 246,113 210,292 165,443
916,585 890,631 1,106,146 1,294,166 1,525,071 1,407,984 1,402,230
(6,631) 59,943 204,083 10,777 281,803 16,321
29,501 21,874 49,654 70,605 53,772 47,591 28,710
1,387,297 1 ,412, 120 1,857,370 1,886,812 2,483,312 2,152,370 2,098,576
825,064 928,769 1,039,270 1,043,176 1,161,530 [,303,374 1,352,357
475,204 465,326 618,346 627,546 807,485 941,926 867,771
1,300,268 1,394,095 1,657,616 1,670,722 1,969,015 2,245,300 2,220,128
87,029 18,025 199,754 216,090 514,297 (92,930) (121,552)
1,022,474 1,151,664 [ ,392,316 1,580,750 1,650,187 1,606,811 1,748,348
(935,445) (1,133,639) (1,192,562) (1,364,660 ) (1,135,890) (1,699,741) (1,869,900)
987,970 1,036,579 1,058,688 1,184,481 1,201,602 1,256,816 1,327,647
128,640 126,949 118,087 148,936 241,478 185,215 74,313
(344,353) (348,784) (374,851) (500,431) (774,315) (1,022,539) (1,014,129)
772,257 814,744 801,924 832,986 668,765 419,492 387,831
(163,188) (318,895) (390,638) (531,674) (467,125) (1,280,249) (1,482,069)
434,763 2,289,342 3,186,636 1,204,559 404,773 1,650,041 3,770,558
271,575 1,970,447 2,795,998 672,885 (62,352) 369,792 2,288,489
19,758,473 20,030,048 22,000,495 24,796,493 25,469,378 25,407,026 25,776,818
$20,030,048 $22,000,495 $24,796,493 $25,469,378 $25,407,026 $25,776,818 $ 28,065,307
64
S rATISTIC^'- FY 2009
SALINA AIRPORT AUTHORITY
CHANGES IN CASH AND CASH EQUIVALENTS
FOR YEARS ENDED DECEMBER 3 I,
CASH FLOWS FROM OPERATING ACTIVITES
Cash received from providing services
Cash paid to employees for services
Cash paid to suppliers for goods and services
NET CASH PROVIDED IN OPERATING ACTIVITIES
2000 2001 2002
$2,997,537 $1,668,782 $1,503,652
(443,968) (463,501) (450,013)
(699,812) (750,913) (748,272)
1,853,757 454,368 305,367
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
Acquisition and construction of property, plant and equipment (720,694)
Purchases in satisfaction of maintenance agreement
Proceeds from capital grants
Return of capital grant proceeds
Proceeds from property tax
Principal payments on debt
Proceeds of new borrowing
Principal received on financing lease
Interest received on financing lease
Principal received on long-term note
Principal received on refunding debt
Bond defeasance and issue costs paid
Interest paid on long-term bonds
Interest paid on long-term debt
NET CASH PROVIDED (USED) IN CAPITAL AND
RELA TED FINANCING ACTIVITIES
801,237
(1,408,978)
64,255
125,190
(29,745)
(290,972)
(571,068) (2,176,229)
(19,095)
144,005
795,403
(674,963)
1,385,000
69,668
119,778
(2 I ,266)
(221,762)
817,499
(694,761)
3,200,235
75,54\
113,905 \
(26,119)
(262,795)
(1,459,707)
CASH FLOWS FROM INVESTING ACTIVlTES;
Interest received on deposits
880,790
1 , I 72, 186
44,049 30,740 30,921
NET INCREASE (DECREASE) IN CASH AND CASH
EQUIV ALENTS
438,099 1,365,898 1,508,4 74
CASH AND CASH EQUIVALENTS, beginning of year
158,631 596,730 1,962,628
CASH AND CASH EQUIVALENTS, end of year
$ 596,730 $1,962,628 $3,471,102
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STATISTICAL FY 2009
SALINA AIRPORT AUTHORITY
CHANGES IN CASH AND CASH EQUIV ALENTS
FOR YEARS ENDED DECEMBER 3\,
2003 2004 2005 2006 2007 2008 2009
$1,374.310 $1,459,696 $2,107,817 $1,993,164 $ 4,588,310 $ 2,426,455 $ 1,974,744
(462,822) (472,178) (504,691 ) (552,966) (638,839) (790,936) (830,298)
(837,530) (871,435) (1,157,454) (1,087,149) (1,281,618) (1,475,036) (1,457,074)
73,958 116,083 445,672 353,049 2,667,853 160,483 (312,628)
(2,319,249) (4,126,043) (5,948,674) (5,130,780) (3,242,102) (8,663,391) (6,999,968)
(9,736) (5,863 ) (1,350) (15,143) (21,601) (7,912) (3,445)
434,763 2,289,342 3,186,636 1,204,559 404,773 1,552,002 3,674,507
987,970 1,036,579 1,058,688 1,184,481 1,201,602 1,256,816 1,327,647
(1,046,750) (988,922) (4,388,400) (1,0]9,673) (1,048,833) (3,946,317) (4,739,437)
3,255,000 J,635,000 3,350,000 ] 2,007,599 8,012,154
81,911 88,823 96,320 104,453 113,279 122,855 ]33,242
107,535 100,623 93,126 84,993 76,167 66,592 56,204
(338,703)
(2,102,259)
(6,147)
(294,691 )
1,348,701
(22,183)
(356,080)
(2,646,917)
(75,986)
(922,725)
462,193
(13,024)
(407,795)
(657,929)
(59,955)
(376,499) (1,249,490)
9,054,430 (10,868,845)
25,475
28,960
25,463
182,515
68,896
125,309
15,550
(2,002,826) 1,493,744 (2,175,782) (235,984) 11,904,798 (10,583,053) 165,115
3,471,102 1,468,276 2,962,020 786,238 550,254 12,455,052 1,871,999
$1,468,276 $2,962,020 $ 786,238 $ 550,254 $12,455,052 $ 1,871,999 $ 2,037,114
66
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STATIS"IICAL ry 2009
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STATISTICAL r'Y 2009
Salina Airport Authority
REVENUE BOND COVERAGE
Ten Years Ended December 31,2009
Fiscal Pledged Revenue Bond
Year Revenue Debt Service Coverae:e
2000 $189,446 $185,013 1.02
2001 $189,446 $164,420 1.15
2002 $189,446 $158,320 1.20
2003 $189,446 $151,923 1.25
2004 $189,446 $150,283 1.26
2005 $189,446 $148,158 1.28
2006 $189,446 $140,557 1.35
2007 $189,446 $67,623 2.80
2008 $189,446 $69,955 2.71
2009 $189,446 $71,955 2.63
Notes:
1. During 1999, the Series 1990-B Bonds were refmanced to remove IRS restrictions and
achieve an interest rate savings.
Source: Salina Airport Authority Records
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18.61 %
11.44%
10.43%
7.52%
6.41%
5.96%
3.76%
2.36%
2.02%
1.79%
1.66%
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1.18%
1.09%
1.05%
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0.81%
0.76%
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0.70%
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0.67%
0.63%
0.61%
0.61%
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STA TISTIC AL I Y 2(J(Jl}
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Salina Airport Authority
Principal Customers
Year Ended December 31,2009
Company
Kansas Military Board (KS Army National Guard)
Hawker Beechcraft Corp.
Kansas State University - Salina
CA V Aerospace, Inc.
JRM Enterprises, Inc, d/b/a America Jet
Flower Aviation
Schwan's Sales, Inc.
Two Rivers Vending Co., Inc.
Johnson Rack, Inc.
Learjet Inc.
Geocore Services
AFK Properties, Inc.
~anadian Royal Air Force
Federal Aviation Adminis.
HRAD Group LLC
Air Midwest, Inc.
Builders Choice Concrete
Kejr, Joe
Waddle's Manufacturing & Machine
Professional Flight Training, LC
United Suppliers, Inc.
Scientific Engineering
Laas, Brent and Mark
ALL TEL Newco No.4 LLC
Bostater Realty, Inc.
Triangle Trucking
Revenue
425,886.00
261,819.62
238,536.00
171,963.60
146,588.45
136,393.82
86,112.00
53,912.33
46,200.00
40,929.52
37,920.00
27,540.00
26,924.25
24,900.00
24,036.00
23,311.98
19,669.00
18,441. 78
17,466.00
16,561.00
15,984.00
15,600.00
15,348.00
14,472.00
14,066.67
13,932.00
Total Operating Lease and Direct Finance Lease Revenue for 2009 was $2,288,022
Source: Salina Airport Authority Records
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STATISTICAL FY 2009
Salina Airport Authority
MILL LEVY REVENUE
Ten Years Ended December 31, 2009
Fiscal Year
Mil Levy
Revenue
2000
$ 801,237
2001
$ 795,404
2002
$ 817,499
2003
$ 987,970
2004
$ 1,036,579
2005
$ 1,058,688
2006
$ 1,184,481
2007
$ 1,201,602
2008
$ 1,256,8]6
2009
$ 1,327,647
Source: Salina Airport Authority Records
72
STATISTICAL rV]009
Salina Airport Authority
AIR TRAFFIC, FUEL FLOW AGE AND ENPLANEMENT TRENDS
Ten Vears Ended December 31,2009
Scheduled
Fiscal Air Traffic Fuel Flowage Air Service
Year Operations Gallons Enplanements
2000 87,709 4,472,164 10,270
200] 92,870 4,396,429 6,507
2002 95,80] 4,695,093 2,565
2003 86,214 4,358,563 2,3]9
2004 8] ,465 3,843,330 2,974
2005 86,292 4,] 62,887 2,339
2006 81,464 3,817,1l2 2,029
2007 76,479 3,778,792 2,945
2008 71,575 3,] 14,5]5 4,654
2009 65,062 2,48],585 2,839
Note:
One air traffic operation equals one aircraft takeoff and landing
Source: Salina Airport Authority Records
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STATISTICAL ry 2009
Salina Airport Authority
Principal Employers
Current Year and Four Years Prior
2009 20061
Percentage of Percentage of
Total City Total City
Employer Employees Rank Employment Employees Rank Employment
Salina Regional Health Center 2,250 1 7.6% 1,600 3 3.7%
Schwan Global Supply Chain, [r 1,600 2 5.4% 1,800 1 5.1%
USD #305 1,512 3 5.4% 1,659 2 4.7%
Exide Technologies 750 4 2.5% 750 4 2.1%
Great Plains Manufacturing 650 5 2.2%
City of Salina 500 6 1.6% 723 5 2.0%
Sunflower Bank 500 7 1.6% 0
Philips Lighting Company 500 8 1.6% 490 7 1.4%
Wal-Mart 400 9 1.3% 421 8 1.2%
Dillons Stores 385 10 1.3% 0.0%
Blue Beacon International 544 6 1.5%
Asurion, Inc. 374 9 1.0%
Hawker Beachcraft Corp. 350 10 1.0%
Total 9,047 30.5% 8,711 23.7%
Source: Salina Area Chamber of Commerce
1 - 2000 Historical records not available
74
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STATISTICAL FV 2009
Lareest Taxpavers
According to the Saline County Clerk's Office, the following table lists the largest taxpayers
in the City, their 2009 assessed valuations, and the percentage each taxpayer comprised of the total
assessed valuation of the City.
%of
Type of Assessed Total
Company Business Valuation Valuation
Schwan's Sales (Tony's Pizza) Frozen Pizza $10,144,446 2.27%
[POFA Salina Central Mall LLC Regional Shopping Center 8,704,250 1.94%
Hospital and Medical
Salina Regional Health Center Offices 5,584,461 1.25%
We star Energy Utility 5,191,056 L.16%
Wal-Mart Stores Discount Retail 3,813,855 0.85%
Gateway Adams Inc. (Midstate
Plaza) Shopping Center 3,556,009 0.79%
Kansas Gas Service Utility 3,499,873 0.78%
Southwestern Bell Telephone Utility 3,455,419 0.77%
Sunflower Bank Financial Institution 2,749,200 0.61%
Great Plains Manufacturing Agricultural Equipment 2526,984 0.56%
$49,225,553 10.99%
Tax Collections
Tax statements are mailed November 1 each year and may be paid in full or one-half on or
before December 20 with the remaining one-half due on or before May 10 of the following year.
Taxes that are unpaid on the due dates are penalized at a statutorily prescribed rate until paid or until
the property is sold for taxes. Real estate bearing unpaid taxes is advertised for sale in July of each
year and is sold by the County for taxes and all legal charges on the first Tuesday in September.
Properties that are sold and not redeemed within two years after the tax sale are subject to foreclosure
sale, except homestead properties which are subject to foreclosure sale after three years.
Personal property taxes are assessed, due and may be paid in the same manner as real estate
taxes. Motor vehicle property taxes are based on valuations provided by the Kansas Department of
Revenue and the county average tax rate for the county in which the vehicle is registered. Motor
vehicle taxes are payable to the county treasurer at the time of the vehicle's annual registration.
Vehicle registration dates are assigned by the State in a manner such as to equal registration over a
twelve-month period. Motor vehicle taxes are distributed by the county to the state, city and other
taxing jurisdictions based on their proportionate tax levies. Delinquent personal and motor vehicle
taxes are penalized at the same rate as delinquent real property taxes.
Source: City of Salina
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A
(
\
Salina Airport Authority representatives attended the Third Annual
Kansas Unmanned Systems Symposium to discuss the future of
unmanned aerial systems in Kansas, particularly Salina, with state-
wide industry professionals in Wichita.
Although their use in Operation Iraq Freedom has generated a fair
amount of buzz among the UAS community, the Symposium was
humming with enthusiasm for what these flying machines bring to
the table as emergency first responders put them to work locally.
Tornados, floods, wildfires and ice storms have presented the UAS
community with a broad range of unique challenges.
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SA LINAA irport
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CLUBlNE&
RETTELE
CHARfERED
Certified Public Acrountants
fill
Robert I. Clubine, C.P.A.
David A. Rettele, C.P.A.
Jay D. Langley, C.P.A.
Jon K. Bell, C.P.A.
Leslie M. Corbett, C.PA
Stacy J. Osner, C.PA
Marci K. Fox, C.PA
John T. Millikin, C.P.A.
Linda A. Suelter, C.PA
218 South Santa Fe
P.O. Box 2267
Salina, Kansas
67402-2267
Salina
785/825-5479
Salina Fax
785 / 825-2446
Ellsworth
785/472-3915
Ellsworth Fax
785 / 472-5478
REPORT ON INTERNAL CONTROL OVER FINANCIAL
REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS
PERFORMED IN ACCORDANCE WITH
GOVERNMENT A UDITING STANDARDS
To the Board of Directors
Salina Airport Authority
We have audited the financial statements of Salina Airport Authority as of and for
the years ended December 31, 2009 and 2008, and have issued our report thereon
dated June 3, 2010. We conducted our audit in accordance with auditing standards
generally accepted in the United States of America and the standards applicable to
financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States and the Kansas Municipal Audit Guide,
prescribed by the Director of Accounts and Reports, Department of Administration
of the State of Kansas.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Salina Airport Authority's
internal control over financial reporting as a basis for designing our auditing
procedures for the purpose of expressing our opinions on the financial statements,
but not for the purpose of expressing an opinion on the effectiveness of the Salina
Airport Authority's internal control over financial reporting. Accordingly, we do
not express an opinion on the effectiveness of Salina Airport Authority's internal
control over financial reporting.
A deficiency in internal control exists when the design or operation of a control
does not allow management or employees, in the normal course of performing their
assigned functions, to prevent or detect and correct misstatements on a timely basis.
A material weakness is a deficiency, or a combination of deficiencies, in internal
control such that there is a reasonable possibility that a material misstatement of the
entity's financial statements will not be prevented, or detected and corrected on a
timely basis.
Our consideration of internal control over financial reporting was for the limited
purpose described in the first paragraph of this section and was not designed to
identify all deficiencies, or material weaknesses. We did not identify any
deficiencies in internal control over financial reporting that we consider to be
material weaknesses, as defined above.
77
Compliance and Other Matters
As part of obtaining reasonable assurance about whether Salina Airport Authority's financial statements are
free of material misstatement, we performed tests of its compliance with certain provisions of laws,
regulations, contracts and grant agreements, noncompliance with which could have a direct and material effect
on the determination of financial statement amounts. However, providing an opinion on compliance with
those provisions was not an objective of our audit, and accordingly, we do not express such an opinion. The
results of our tests disclosed no instances of noncompliance or other matters that are required to be reported
under Government Auditing Standards.
This report is intended solely for the information and use of the audit committee, management, others within
the organization, the City Commission and federal awarding agencies and pass-through entities and is not
intended to be and should not be used by anyone other than these specified parties.
CLUBINE AND RETTELE, CHARTERED
~ CUl/- <UItt
June 3, 2010
78
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CLUBlNE&
RETIELE
rnARfERED
Certified Public Acrountants
v
Robert I. Clubine, C.PA
David A. RetteJe, C.P.A.
Jay D. Langley, C.P.A.
Jon K. Bell, C.PA
Leslie M. Corbett, C.PA
Stacy J. Osner, C.P.A.
Marci K. Fox, C.P.A.
John T. Millikin, C.PA
Linda A. Suelter, C.P.A.
218 South Santa Fe
P.O. Box 2267
Salina, Kansas
67402-2267
Salina
785 / 825-5479
Salina Fax
785 / 825-2446
Ellsworth
785/472-3915
Ellsworth Fax
785/472-5478
REPORT ON COMPLIANCE WITH REQUIREMENTS
APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL
CONTROL OVER COMPLIANCE IN ACCORDANCE
WITH OMB CIRCULAR A-I33
To the Board of Directors
Salina Airport Authority
Compliance
We have audited the compliance of Salina Airport Authority, with the types of
compliance requirements described in the U. S. Office of Management and Budget
(OMB) Circular A-I33 Compliance Supplement that are applicable to each of its
major federal programs for the year ended December 31, 2009. Salina Airport
Authority's major federal programs are identified in the summary of auditors'
results section of the accompanying schedule of findings and questioned costs.
Compliance with the requirements of laws, regulations, contracts and grant
agreements applicable to each of its major federal programs is the responsibility of
Salina Airport Authority's management. Our responsibility is to express an opinion
on Salina Airport Authority's compliance based on our audit.
We conducted our audit of compliance in accordance with auditing standards
generally accepted in the United States of America; the standards applicable to
financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States; and OMB Circular A-I33, Audits of
States, Local Governments, and Non-Profit Organizations. Those standards and
OMB Circular A-l33 require that we plan and perform the audit to obtain
reasonable assurance about whether noncompliance with the types of compliance
requirements referred to above that could have a direct and material effect on a
major federal program occurred. An audit includes examining, on a test basis,
evidence about Salina Airport Authority's compliance with those requirements and
performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion. Our audit
does not provide a legal determination on Salina Airport Authority's compliance
with those requirements.
In our opinion, Salina Airport Authority complied in all material respects, with the
requirements referred to above that are applicable to each of its major federal
programs for the year ended December 31, 2009.
Internal Control Over Compliance
The management of Salina Airport Authority is responsible for establishing and
maintaining effective internal control over compliance with requirements of laws,
regulations, contracts and grants applicable to federal programs. In planning and
performing our audit, we considered Salina Airport Authority's internal control
over compliance with requirements that could have a direct and material effect on a
major federal program in order to determine our auditing procedures for the
purpose of expressing our opinion on compliance and to test and report on internal
control over compliance in accordance with OMB Circular A-l33, but not for the
purpose of expressing an opinion on the effectiveness of internal control over
compliance. Accordingly, we do not express an opinion on the effectiveness of
Salina Airport Authority's internal control over compliance.
79
A deficiency in internal control over compliance exists when the design or operation of a control over
compliance does not allow management or employees, in the normal course of performing their assigned
functions, to prevent, detect and correct noncompliance with a type of compliance requirement of a federal
program on a timely basis. A material weakness in internal control over compliance is a deficiency, or
combination of deficiencies, in internal control over compliance such that there is a reasonable possibility that
material noncompliance with a type of compliance requirement of a federal program will not be prevented,
detected and corrected, in a timely basis.
Our consideration of internal control over compliance was for the limited purpose described in the first
paragraph of this section and was not designed to identify all deficiencies in internal control over compliance
that might be deficiencies, significant deficiencies or material weaknesses. We did not identify any
deficiencies in internal control over compliance that we consider to be material weaknesses as defined above.
This report is intended solely for the information and use of the audit committee, management, others within
the organization, the City Commission and federal awarding agencies and pass-through entities and is not
intended to be and should not be used by anyone other than these specified parties.
CLUBINE AND RETTELE, CHARTERED
CIMk~ tiM.d ~
June 3, 2010
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SALINA AIRPORT AUTHORITY
Salina, Kansas
SCHEDULE OF EXPENDITURES OF FEDERAL A WARDS
F or the Year Ended December 31, 2009
Federal
CFDA
Number
Federal Grantor / Pass-through Grantor /
Program or Cluster Title
U.S. Department of Transportation
Airport Improvement Program
20.106
ARRA - Airport Improvement Program
20.106
U.S. Department of Homeland Security
Law Enforcement Officer Reimbursement
Agreement Program
97.090
Total Expenditures of Federal Awards
Pass-through
Entity
Identifying
Number
N/A
N/A
N/A
See notes to the schedule of expenditures of federal awards.
Schedule 1
Federal
Expenditures
$ 2,429,409
690,809
16,988
$ 3,137,206
81
SALINA AIRPORT AUTHORITY
Salina, Kansas
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL A WARDS
For the Year Ended December 31, 2009
Note 1 Basis of Presentation
The accompanying schedule of expenditures of federal awards includes the federal grant activity of
Salina Airport Authority and is presented on the accrual basis of accounting. The information in this
schedule is presented in accordance with the requirements of OMB Circular A-I33, Audits of States,
Local Governments, and Non-Profit Organizations. Therefore, some amounts presented in this
schedule may differ from amounts presented in, or used in the preparation of, the basic financial
statements.
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SALINA AIRPORT AUTHORITY
Salina, Kansas
Schedule 2
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
For the Year Ended December 31, 2009
There are no prior audit findings.
83
SALINA AIRPORT AUTHORITY
Salina, Kansas
Schedule 3
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
For the Year Ended December 31, 2009
SECTION I - SUMMARY OF AUDITORS' RESULTS
Financial Statements
1. Type of auditor's report issued:
Unqualified
2. Internal control over financial reporting:
Material weaknesses identified?
-yes ---.2Lno
Significant deficiencies identified that are not considered
to be material weaknesses?
-yes ---.2Lnone reported
3. Noncompliance material to financial statements noted?
-yes ---.2Lno
F ederal Awards
1. Internal control over major programs:
Material weaknesses identified?
-yes Lno
Significant deficiencies identified that are not considered
to be material weaknesses?
-yes Lnone reported
2. Type of auditor's report issued in compliance for major
programs:
Unqualified
3. Any audit findings disclosed that are required to be reported
in accordance with Section 51O(a) ofOMB Circular A-l33:
-yes Lno
4. Identification of major programs:
20.106
Airport Improvement Program
5. Dollar threshold to distinguish between Type A and
Type B programs:
$300,000
6. Auditee qualified as a low-risk auditee?
LYes no
SECTION II - FINANCIAL STATEMENT FINDINGS
None.
SECTION III - FEDERAL AWARD FINDINGS AND QUESTIONED COSTS
None.
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SALINA AIRPORT AUTHORITY
Salina, Kansas
Schedule 4
CORRECTIVE ACTION PLAN
For the Year Ended December 31, 2009
None required.
85
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A
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The Salina Airport Authority announced the official opening of the
looLL Av gas self service fueling station in October.
By offering a self fueling station, the Airport Authority hopes to
achieve a Board stated goal of "growing and sustaining general
aviation operations at the Municipal Airport."
The station, located just south of the National Guard hangar, takes all
major credit and branded debit cards.
Accessory equipment including a ladder, steps and chocks are
available for fueling convenience. A hazardous material spill kit is
also located on site for safety and a self fueling training slide show is
available on the Airport Authority's website.
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3237 Arnold I Salina, KS 67401 I 785-827-3914
www.salinaairport.com I www.flysalina.com