Audit Report - 1995
COMPREHENSIVE ANNUAL FINANCIAL REPORT
of the
SALINA AIRPORT AUTHORITY
A Component Unit of the
City of Salina, Kansas
For the Fiscal Year Ended December 31, 1995
Prepared by the Management
of the
Salina Airport Authority
SALINA AIRPORT AUTHORITY
TABLE OF CONTENTS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
For the Fiscal Year Ended December 31, 1995
INTRODUCTORY SECTION
Letter of Transmittal
Principal Officers
Authority Staff Members
Organizational Chart
Certificate of Achievement
Salina Municipal Airport Aerial View
Page
1
10
11
12
13
14
FINANCIAL SECTION
Independent Auditor's Report
15
Financial Statements:
Comparative Balance Sheets
Comparative Statements of Operations and Changes
in Retained Earnings
Comparative Statements of Cash Flows (Direct Method)
Reconciliation of Operating Loss to Net Cash Flows
from Operating Activities
Notes to Financial Statements, December 31, 1995 and 1994
17-18
19
20
21
22
Supplemental Information:
Schedules of Operations and Changes in Retained Earnings
Capital Expenditures
General Obligation Economic Development Bonds - Series 1990-A
General Obligation Economic Development Bonds - Series 1990-B
Leasehold Revenue Bonds - Series 1991
General Obligation Bonds - Series 1993A
General Obligation Bonds - Series 1993B
Insurance in Force
Schedule of Federal Assistance
Comparison of Gross Cash Balances with Depository Security
39-40
41
42
43
44
45
46 .
47
48
49
STATISTICAL SECTION
Operating Revenue History
Operating Expense History
Federal Financial Assistance History
Capital Expenditure History
Revenue Bond Coverage
Principal Customers
Local Government Property Tax Rates, Direct & Overlapping
Property Tax Revenue
Air Traffic, Fuel Flowage, Enplanements Trends
Major Employers
Salina Population, Demographic and Labor Statistics
OTHER INDEPENDENT AUDITOR'S REPORTS
Independent Auditor's Report on Internal Control Structure
Based on an Audit of Financial Statements Performed
in Accordance with Government Auditing Standards
Independent Auditors's Report on Compliance Based on an Audit
of Financial Statements Performed in Accordance with
Government Auditing Standards
Independent Auditor's Report on Schedule of Federal
Financial Assistance
Independent Auditor's Report on the Internal Control Structure
Used in Administering Federal Financial Assistance Programs
Independent Auditor's Report on Compliance with the General
Requirements Applicable to Federal Financial Assistance Programs
Independent Auditor's Report on Compliance with Specific
Requirements Applicable to Major Federal Financial Assistance
Program Transactions.
Schedule of Independent Auditor's Findings
ii
Page
50
51
52
53
54
55
56
57
58
59
60
61
63
64
65
68
69
70
~ Salina Airport Autholrity
d.A.~ Salina Municipal Airport I Industrial Center
Chairman Vice-Chairman Secretary Treasurer Assistant Secretary / Treasurer
RICHARD A. RENFRO CHARLES STEVENS. JR. JAMES C. MAES R. MICHAEL BEATTY DOROTHY W. LYNCH
Executive Director: TIMOTHY F. ROGERS, A.A.E. Operations Director: DONALD C. KNEUBUHL Board Attorney: GREG A. BENGTSON
March 15, 1996
Salina Airport Authority Board of Directors
3237 Arnold Ave.
Salina, KS 67401
To the Board of Directors of the Salina Airport Authority:
The Comprehensive Annual Financial Report of the Salina Airport Authority (the
"Authority") for the fiscal year ended December 31, 1995 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 of the Authority's 11995 CAFR.
Responsibility for both the accuracy of the data presented and the compl19teness and
fairness of the presentation, including all disclosures, rests with the Executive Director
of the Authority. To the best of my 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.
ORGANIZATION OF THE REPORT
The Authority applies the standards for preparation of local government financial reports
recommended by the Government Finance Officers of the United States and Canada
(GFOA). The Authority's 1995 Component Unit Financial Report is presented in four
sections:
Introductory Section - contains this letter of transmittal, a list of the
Authority's principal officers, a listing of Authority staff members, an
organizational chart, the GFOA Certificate of Achievement for Excellence
in Financial Reporting for fiscal year 1994, and an aerial photo of the
Salina Municipal and Airport Industrial Center.
Financial Section - includes the independent auditor's report, the
Authority's 1995 financial statements and supplemental schedules.
Statistical Section - includes selected financial and demographic
information which highlights economic and demographic trends.
(1 )
3237 ARNOLD. SALINA, KS 67401-8190. Off: (913) 827-3914. Fax: (913) 827-:2221
Other Independent Auditor's Reports Section - includes reports
concerning the Authority's internal control structure, compliance with
Comptroller General of the United States government audit standards and
compliance with audit standards due to receipt of federal financial
assistance, reporting on the presentation of the schedule of ìfederal
financial assistance, reporting on the internal control structure used in
administering federal financial assistance programs, compliance with
general requirements applicable to federal financial assistance prowams,
and compliance with specific requirements applicable to major federal
financial assistance program transactions.
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 (KSA 27-315 et seq.) The Authority was created for the purpose of accepting
as surplus property portions of the former Schilling A.F.B. which was closed by the
United States Department of Defense in June, 1965. By quitclaim deed the Authority
received over 3,500 acres of land and numerous buildings for the purpose of operating
and 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 and administrative
officer of the Authority. The Executive Director hires the remaining employees of the
Authority. The Executive Director and his staff of thirteen employees rnanage and
operate the Salina Municipal Airport and the Salina Airport Industrial CentE3r.
Based upon the degree of fiscal and oversight responsibility exercised by the Authority's
governing board, the Authority is considered a component unit of the City of Salina under
the criteria set forth by the Governmental Accounting Standard Board (GASB) Statement
No. 14.
The Salina Municipal Airport is the only commHrcial service airport serving Salina/Saline
County and the 22-county area which comprisE~s 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 the Kansas State
University - Salina Aeronautical Technology DE~partment. The campus of K-State Salina
is located adjacent to the airport. The K-State Salina Department of Aeronautical
Technology offers degrees in professional fllight training, airframe and power plant
maintenance, and avionics technology.
(2)
/~ Salina Airport Authority
d~"'",~ Salina Municipal Airport !Industrial Center
The Salina Airport Industrial Center is home for seventy-one businesses and
organizations. Forty-nine of the businesses and organizations are tønants of the
Authority. One of the primary functions of the Authority is to facilitate the continued
growth of jobs and payroll at the 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 Economy
The Salina/Saline County economy has continued to demonstrate economic strength, as
compared to other regions of the state. Growth in the areas o.r agriculture,
manufacturing, wholesale trade, services, construction and especially retail trade, confirm
Salina's position as one of Kansas' strongest regional economic centers.
One of the strengths of the local economy is retail trade. Retail sales have been growing
at the nominal rate of 9.8% since 1990. Salina is and will likely remain the retail hub for
North Central Kansas. Estimated annualized retail sales for Salina/Saline County is $708
million, approximately 60% above 1990 sales figures.
In recent years, Salina has experienced significant growth in population an(j consequent
rising demand for both housing and education. Residential property values have risen
and new housing is being constructed to meet the needs of a growing labor force.
The growth is in response to the expansion in employment opportunities in the
Salina/Saline County area. With the exception of government, every job sector has seen
employment growth since 1992. During 1995, employment reached 28,117 people.
Economic Condition of the Airport and Airport Industrial Center
As of December 31, 1995 businesses and organizations at the AirpOr1t and Airport
Industrial Center employed an estimated 4,707 employees. Seventy-two percent of the
.. total number of employees live within the Salina city limits. Fourteen percent of Airport
Industrial Center employees live within Saline County and 14% live outside Saline
County. Total payroll for 1995 was an estimated $117,439,903. In 199510c:al purchases
by Airport and Airport Industrial Center businesses and organizations totaled an
estimated $37,572,250. In 1995 capital expenditures equalled $18,716,527. Less than
51 % of total business volume was local, which means that over 49% of the goods and
services produced by all businesses are exported outside of the City of Salina.
(3)
/~ Salina AirDort Authority
d""""~ Salina Municipal Airport I Industrial Center
In 1995 the Airport and Airport Industrial Center attracted an estimated :36,720 visitors
whose average stay was 2.7 days. Airport and Airport Industrial Center visitors
expended an estimated $2,478,600 while in Salina,
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 750 new jobs will
be added to the economy during 1996. Airport Industrial Center businøsses such as
Raytheon Aircraft Company, Tony's Pizza, Inc" Score Rite, Salina Vortex, Geocore
Environmental Services, and Palleton of Kansas, Inc. continue to work on facility
expansion plans. These expansions will result in additional jobs and payroll.
INITIATIVES AND DEVELOPMENT
Salina Municipal Airport
Completed Phase I of a multi-phased reconstruction of the aircraft parking apron
at the Salina Municipal Airport. The $2,078,118 project was completed with the
assistance of a Federal Aviation Administration Grant which funded 90% of the
project.
Obtained a Federal Aviation Administration Airport Improvement Program grant
in the amount of $1,388,935 for phase" of aircraft parking apron reconstruction.
The grant funds 90% of total project costs.
Completed the fourth and final phase of the rehabilitation of aviation fuels
pumphouse #305. Completion of the rehabilitation during 1995 enables the
Authority and its tenants to meet the December, 1998 deadline tor upgrading
underground fuel storage tanks.
Completed acquisition of 162.34 acres of land for runway protection zones at the
ends of runway 17/35.
Salina Airport Industrial Center
Supported building expansions, new building construction, and manufacturing
expansions completed or started by the following firms:
(4)
/~ Salina Airport Authority
4'~.....~ Salina Municipal Airport I Industrial Center
Western Wireless Communications
Land of Oz Meats
Coronado Engineering
Recycle-It
Moore's Midway Aviation
Flower Aviation
Raytheon Aircraft Co.
Schwan's Sales Enterprises
Financial Affairs
Building Lease
Building Lease
Building Lease
Building Lease
Lease Addendum
Lease Addendum
Lease Extension
Land Sale
Adoption of a 1.372 mill levy to match federal funds for airfield improvements
($190,000) and development of an industrial center replat and secondary street
development plan ($85,500) in 1996.
Staff Accomplishments
Supported the United States Air Force Reserve 4th AF during the 1995 training
exercise, Patriot Express. Over 500 4th AF personnel were assigned to the
Salina Municipal Airport during the two week exercise.
Environmental
Completion of the U. S. Corps of Engineers and SAA UST undl3rground fuel
storage tank removal project. The partnership between the Corps of Engineers
and the SAA was recognized in the Defense Environmental Restoration
Program's Annual Report to Congress for Fiscal Year 1994. The Corps of
Engineers completed the project at an estimated cost of $8 million dollars. As a
result of the project, 107 underground fuel storage tanks were removed.
INTERNAL CONTROL STRUCTURE AND BUDGETARY 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 providH reasonable,
but not absolute, assurance that these objectives are met. The concept of reasonable
(5)
,~ Salina Airport Authority
d~......~ Salina Municipal Airport I Industrial Center
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. The Authority
is specifically exempt from the budget laws of the State of Kansas (K.S.A. 27-322). 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.
RESULTS OF OPERATIONS
Revenues
The operating revenues of the Authority increased 6.5% from the previous year. The
increase in rental revenues is the result of increases in industrial building occupancy and
additional land leases. The increase in fixed base operator (F.B.O.) fees is due to higher
fuel flowage fees agreed to by the Authority's two F.B.O.'s and corporate hangar tenants.
The increase in landing fees is due to increased flights by US Air Express and
commercial charter operators. The loss on sale of assets was the result of the sale of
31,14 acres of Airport Authority real estate to Schwan's Sales Enterprises, Inc. Other
operating revenues increased due to increases in commissions received fmm car rental
agencies located in the Airport Terminal building.
A summary of operating revenues follows:
Operatino Revenues
Increase Percent
(Decrease) Increase
.19.95 1991 From 1994 (Decrease)
$1,048,563 $ 975,011 $ 73,552 7.5%
98,429 90,511 7,918 8.7%
13,714 10,982 2,732 24.9%
(24,024) 0 (24,024)
15.637 5.914 9.723 164.4%
~ ~ ~ 69.901 6.5 %
Rental revenues
Fixed base operator
Landing fees
Gain (loss) on sale of assets
Other operating revenues
Total
Expenses
Total operating expenses before depreciation increased 2.3%. Office and administrative
expenses increased 3.0% due to increases in office salaries, travel and meetings, health
and life insurance, FICA tax, Kansas unemployment tax, employees' retirement, airport
promotion, dues and subscriptions, property appraisals and other administrative
(6)
/~ Salina Airport Authority
d""'",~ Salina Municipal Airport ¡Industrial Center
expenses. Maintenance expenses increased 1.4% due to increases in maintenance
salaries, equipment, gas, oil and repairs, utilities and agricultural land expenses.
A summary of operating expenses follows:
Operatinç¡ Expenses 19.9.5. 1illH
Office and Administration $481,914 $467,803
Maintenance 375.594 370.266
Total $857.508 ,$838.069
I ncrease Percent
(Decrease) Increase
From 1994 (Decrease)
$ 14,111
5.328
~
3.0%
1.4%
2.3%
FIDUCIARY OPERATIONS
In 1991 the Authority entered into an Interlocal Cooperative Agreement with the Kansas
Board of Regents, Kansas State University, and the City of Salina. Under the
agreement, the City transfers to the Authority the proceeds from a 1/2 cent retail sales
tax. The funds are designated for capital improvements to the campus of Kansas State
University--Salina, College of Technology located at the Airport Industrial Center. In
accordance with the terms of the interlocal agreement, the Authority is responsible for
assuring that the sales tax proceeds are expended in a manner consistent with specific
project budgets previously approved by the Salina City Commission.
DEBT ADMINISTRATION
The outstanding long-term debt of the Authority was $3,550,000 at December 31, 1995.
This debt consists of building revenue bonds, general obligation bonds, and leasehold
revenue bonds of the Authority. Maturities range from 1995 through 2010 and interest
rates range from 3.4% to 8.5%. Both principal and interest are payable from proceeds
of direct financing leases and the general revenues of the Authority. Details are shown
in Note 7: LONG-TERM DEBT.
CASH MANAGEMENT
All cash temporarily idle during 1995 was invested by the Executive Dilrector 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. All funds
are deposited daily and all accounts are interest bearing.
(7)
/~" Salina AirDort Authority
.4".... ~ Salina Municipal Äirport I Industrial Center
RISK MANAGEMENT
It is the policy of the Authority to eliminate or transfer risk 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 $500,000 of comprehensive general liability insurance which
matches the limit established by the Kansas Tort Claims Act. During 1995 the Authority
carried $7,126,859 of insurance on airport commercial properties.
The Authority's commercial property insurance includes $1,607,475 in loss of rents
coverage. All contractors and lessees are required to carry amounts of insurance with
limits and deductibles approved by the Authority. A schedule of insurance in force at
December 31, 1995 is included in this report.
In addition, the Authority uses various risk management techniques. All contractors and
lessees 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.
INDEPENDENT AUDIT
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, Harrison &
Arnett, Chartered. The independent audit is in accordance with the Kansas Minimum
Audit Guide, the Government Auditory Standards issued by the Comptroller General of
the United States, and the provisions of the Office of Management and Budget Circular
A-128, "Audits of State and Local Governments".
GFOA CERTIFICATE OF ACHIEVEMENT
The Government Finance Officers Association of the United States and Canada (GFOA)
awarded a Certificate of Achievement for Excellence in Financial Reporting¡ to the Salina
Airport Authority for its component unit financial report for the fiscal year ended
December 31, 1994. The Certificate of Achievement is a prestigious national award
recognizing conformance with the highest standards for preparation of state and local
government financial reports.
In order to be awarded a Certificate of Achievement, a government unit must publish an
(8)
/~ Salina Airport Authority
d~"",~ Salina Municipal Airport 'Industrial Center
easily readable and efficiently organized comprehensive annual financial report (CAFR),
whose contents conform to program standards. Such CAFR 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 our
current report continues to conform to the Certificate of Achievement program
requirements, and we are submitting it to GFOA.
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 pmparation and
review of this report and is committed to responsible and progressive financial reporting.
Also acknowledged is the assistance of the Authority's auditor, Harrison & Arnett,
Chartered, Certified Public Accountants, Shirley J. Jacques, County Clerk for Saline
County, Gerald Cook, President of the Salina Area Chamber of Commerce and Kevin
Boyd, Professor of Business and Economics at Kansas Wesleyan University in the
preparation of this report.
Respectfully submitted,
2~!~Z::
Executive Director
Salina Airport Authority
cc:
The City of Salina Board of Commissioners
(9)
/~" Salina Airport Authority
-d...... ~ Salina Municipal Airport 'Industrial Center
SALINA AIRPORT AUTHORITY
PRINCIPAL OFFICERS AS OF DECEMBER 31.1995
BOARD OF DIRECTORS
Dorothy W. Lynch
Richard A. Renfro
Charles Stevens, Jr.
Joseph M. Ritter
James C. Maes
Chairman
Vice-Chairman
Secretary
Treasurer
Asst. Secretary/Treasurer
AUTHORITY'S COUNSEL
Larry O. Bengtson
Clark, Mize & Linville, Chartered
Salina, Kansas
AUTHORITY'S BOND COUNSEL
Gilmore & Bell
Kansas City, Missouri
AUTHORITY'S FINANCIAL ADVISOR
George K. Baum & Company
Kansas City, Missouri
AUTHORITY'S AUDITOR
Thomas G. Arnett
Harrison & Arnett, Chartered
Salina, Kansas
(10)
SALINA AIRPORT AUTHORITY
AUTHORITY STAFF MEMBERS
as of December 31. 1995
ADMINISTRATION STAFF
Timothy F. Rogers, A.A.E.
Donald C. Kneubuhl
Cathy Lentz
Shelli Swanson
Jennifer Shotts
Executive Director
Operations Director
Administrative Assistant
Secretary/Reception ist
Airport Management Intern
OPERATIONS, MAINTENANCE, AIRCRAFT RESCUE & FIRE FIGHTING STAFF
John Banninger
Loren Carleton
Kim Colby
Gary Hansen
Dale Mattison
David Nease
Rob Pejsha
Jason Pinnick
Supervisor
Operations, Maintenance & ARFF
Operations, Maintenance & ARFF
Operations, Maintenance & ARFF
Operations, Maintenance & ARFF
Operations, Maintenance & ARFF
Operations, Maintenance & ARFF
Operations, Maintenance & ARFF
TERMINAL BUilDING CUSTODIAL STAFF
Vachel Keaton
Francis Vestal
Custodian
Custodian
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SALINA AIRPORT AUTHORITY
ORGANIZATIONAL CHART
As of December 31, 1995
f-'
N
SAA BOARD OF DIRECTORS
Dorothy W. Lynch 3/91 - 2/28/97
Richard A. Renfro 7/92 - 2/28/97
Charles E. Stevens, Jr. 3/93 - 2/28/96
Joseph M. Ritter 3/93 - 2/28/96
James C. Maes 3/95 - 2/28/98
EXECUTIVE DIRECTOR
Timothy F. Rogers, A_A_E.
Airport Managment
Intern
Jennifer Shotts
Administrative
Assistant
DIRECTOR OF OPERATIONS Cathy Lentz
Donald Kneubuhl
Secretary
Shelli Swanson
Maintenance & Operations Supervisor
John Banninger
Custodian Custodian
V. Keaton F. Vestal
G. Hansen R. Pejsha R. Colby D. Nease D. Mattison L. Carleton J. Pinnick
Certificate of
Achievement
for Excellence
in Financial
Repo rtin g
Presented to
Salina Airport Authority,
Kansas
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
December 31, 1994
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,
b-- ~,-Q
President
!fh/.~
Executive Director
(13)
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HARRISON & ARNETT
CHARTERED
CERTIFIED PUBLIC ACCOUNTANTS
EUGENE O. HARRISON, C.P.A.
THOMAS G. ARNETT, C.P.A.
719 EAST CRAWFORD. SALINA, KANSAS 67401
PHONE: (913) 827.7244
FAX: (913) 827.0048
INDEPENDFNl' AIJDI'IOR' S REFORl'
'Ib the Board of Directors
Salina Airport Authority
Sal ina , Kansas
We have audited the acccarpanyin:J financial state1ænts of the Salina AiJ:port
Authority, a CXI1¥?Onent unit of the City of Salina, Salina, Kansas, as of
December 31, 1995 am December 31, 1994 am for the years then errled as listed
in the table of cx:mt:ents. 'Ihese financial statements are the responsibility of
the Salina Ab:port Authority, Salina, Kansas, management. OUr responsibility
is to express an opinion on these financial statements based on our audit.
We corrlucted our audit in accordance with generally accepted audi tinq
st.arrlards, am the Kansas Municipal A1.1di t Guide, Government Audi tinq St:arrlaràs,
issued by the Comptroller General of the United States, am the provisions of
Office of Management am Budget Circular A-12S, "A1.1dits of State am Local
Goverrments" . '!hose st.arrlards am CMB Circular A-12S require that ~ plan am
perfonn the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatement. An audit includes examirrin;J, on
a test basis, evidence S\JR)Ortin:J the amounts am disclosures in the financial
state1ænts. An audit also includes assessin;J the acca.mtin;J principles used
am significant estimates made by management, as væll as evall1a'tÍD:J th~= overall
financial statement presentation. We believe that our audit provides a
reasonable basis for our opinion.
In our opinion, the financial statements referred to above present fairly,
in all material respects, the financial position of the Salina Ab:port
Authority, Salina, Kansas, as of December 31, 1995 am rÞn:>mher 31, 1994, am
the results of its operations am its cash flows for the years then en:ied in
confonnity with generally accepted acca.mtin;J principles.
MEMBERS OF
DIVISION FOR CPA FIRMS PRIVATE COMPANIES PRACTICE SECTION
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS
KANSAS SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS
(15)
our audit was conducted for the purpose of fanning an opinion on the
financial statelæl1ts taken as a whole. 'Ihe supplemental infonnation listed in
the table of contents is presented for purpose of additional analysis arrl is
not a required part of the financial statements of the Salina. Airport
Authority, Salina, Kansas. SUch infonnation has been subjected. to the auditing
procedures applied in the examination of the financial statements arrl, in our
opinion, is fairly presented in all ma.terial respects in relation to the
financial statelæl1ts taken as a whole.
7~~ fa~
Sal ina. , Kansas
March 15, 1996
~ /tJ)
V-~4~ ¿~A
Certified Public Accountant in charge
of arrl actively engaged on this audit.
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(THIS PAGE INTENTIONALLY LEFT BLANK)
SALINA AIRroRl' AIJIHORITY
crMPARATIVE BAlANCE SHEErS
ASSETS
C1JRRENI' ASSETS:
Cash (Note :2)
Accounts receivable-net of allCMa11Ce for
uncollect~Jle accounts of $500 and $1,000
respecti val y
Prepaid exp:mses
Notes receivable-current
Total QrITe1'lt Assets
RESTRICI'ED ASS:ITS: (Note 3)
Cash and cash equivalents
Invesbnent securities
Assets desilgnated for deferred
compensation benefits
Total Restricted Assets
NFl' INVE'3'IMENT IN FINANCING I.FASES (Note 4)
NET INVES'lMENT ill FIXED ASSETS (Note 5)
OIHER ASSETS:
Borrl issue costs, less accunuùated
amortization of $25,112 and $21,050
respectively
'IUI'AL ASSEI'S
(continued)
December 31,
1995 1994
$ 472,008 $ 651,512
4,375 482
14,864 12,607
- 3,893
491,247 668,494
526,385 1,359,740
- 60,000
48,925 49,967
575,310 1, 469,707
2,100,651 2,408,665
15,265,488 11,926,576
83L099
92L223
$18,515,795
$16,565,665
See notes to financial statements
(17)
SALINA AIRroRI' AU'lliORITY
CXMPARATIVE BMANCE SHEErS
Total CUrrent Liabilities
IÆ!cernber 31,
1995 1994
$ 31,865 $ 9,395
50,000 9,857
15,460 1~: ,612
8,193 ~¡, 626
5,526 2~¡, 734
111,044 6~i , 224
182,885 1,244,740
76,576 81,280
76,942 78,634
190,000 305,,000
48,925 49,967
575,328 L 759 ,621
LIABILITIES AND Ð:>UITY
CURRENT LIABILITIES:
Acx:::ounts payable-operations
Accounts pa yab 1 e-cap i tal
Accrued payroll and expenses
Deferred maintenance
Deferred rent
RES'IRI CI'ED LIABILITIES:
Salina-KSU sales tax liability (Note 3)
Accrued interest payable
Deferred interest financing leases
CUrrent maturities of long-tenn debt
Deferred <:x:11pellSation payable
Total Restricted Liabilities
IJ:)NG-JI'ERM LIABII.J:TIES: (Note 7 )
Bon:ls payable, less current maturities
3,360,000
3,550,000
Total Liabilities
4,046,372
5,374,845
Ð;:PITY :
Contributed capital, Federal
Aviation Administration
Retained ean1ings
Total Equity
7,121,009 4,301,825
7,348,414 6,888,995
14,469,423 11,190,820
$18,515,795 $16,565,665
'lUI'AL LIABILITIES AND Ð;:PITY
See notes to financial stateIænts
(18 )
SALINA AIRFORI' AIJIHORITY
<n1P ARATIVE STATEMENTS OF OPERATIONS AND QiANGES
ill REI'AINED EARNINGS
OPERATING r.œs
J anuarv 1 to Lecernber 31.
1995 1994
$1,048,563 $ 975,011
98,429 90,511
13,714 10,982
(24,024) -
15.637 5.914
1. 152.319 1.082.418
481,914 467,803
375.594 370.266
857.508 838.069
294,811 244,349
636.897 597.482
(342.086) (353 .133)
406,232 301,829
260,261 272,885
(256.737) (272.388)
409.756 302.326
67,670 (50,807)
391. 749 363.218
459,419 312,411
6,888,995 7,140,736
- (564.152)
$7,348,414 $6,888,995
OPERATING REVENUES:
Rental revenues
Fixed base operator
I.an:li.nJ fees
Gain (loss) on sale of assets
other operating revenues
Total O{:erating Revenues
OPERATING EXPENSES BEFORE DEPRECIATION
Office am administration
Maintenance~
Total O{:erating Expenses Before
Depreciation
OPERATING illa:r-m BEFORE DEPRECIATION
DEPRECIATION
NON~PERATING illm-Π(EXPENSE):
Mill levy
Interest on investments and
f inane ing leases
Interest e>:pense
Net Non-{)perating :In<::aœ
NET ill<nm (U::~)
AID DEPRECIATION ON ASSEl'S A<::UJIRED 'IHROOGH
FEDERAL CDNnUBJI'IONS
illæFASE (DEaŒ'ASE) ill REl'AINED EARNINGS
REl'AINED EARNINGS, January 1
PRIOR PERIOD 1~ (Note 13)
REl'AINED EARNINGS, December 31
See notes to financial statements
(19 )
SALINA AIRroRI' AUlHORITY
<XMP ARATIVE STATEMENTS 0 F ~ F'I..CMS
(DIRECr MElliOD)
CASH F'LCMS FRCM OPERATING ACITVITIES:
cash received fram sales, commissions
fees arrl rents
cash paid en-ployees for services
cash paid to suppliers for goods arrl services
cash paid to KSU-Salina proj ect contractors
Net cash Provided (Used) In
Operating Activities
January 1 to December 31,
1995 1994
$1,487,769
(364,130)
(469,750)
(1, 078,588)
(424,699)
~ FI!:MS FRCM CAPITAL AND REIATED FINANCING ACITVITIES:
Purchase of property, plant arrl equiprent ( 4, 179, 123)
Prcx:::eeds fram capital grants (FAA) 3,210,933
Prcx:::eeds fram property tax 406,232
Bond issue costs
Prcx:::eeds from sale of assets
Principal payments on debt
Principal received on financing leases
Interest received on financing leases
Principal received on long-term notes
Interest paid
Net cash Provided (Used) In capital And
Related Financing Activities
~ FI!:MS FRCM INVESTING ACITVITIES:
Sale of investments
Interest received
Net Cash Provided (Used)
In Investing Activities
rnc:::RFASE (DECREASE) rn ~ & ~
FXmVAIENTS
~ BAIANCE~anuary 1
~ BAIANCE-December 31
~ AND ~ EQJIVAIENTS
Nr END OF YEAR CDNSISIS OF:
Unrestricted cash
Restricted cash arrl cash equivalents
(305,000)
191,920
229,632
3,893
(252,317)
$1,116,831
(346, 754)
(477,672)
j£J)00,385)
~707 ,980)
(953,438)
270,191
301,829
(2,064)
(350,000)
JL78,446
243,108
10,061
---..G! 64 , 879)
(693,830) ~)66, 746)
60,000 40,000
45,670 94,686
105,670 134,686
(1,012,859) (2,140,040)
2, OIl, 252 ....1.J.51, 292
$ 998,393 $2,011,252
$ 472,008
526,385
$ 998,393
(continued)
See notes to financial statements
(2 0)
$ 651,512
-L.]59,740
$2,011.252
RECDNCILIATION OF OPERATING IDSS TO NEI'
CASH F'I.GlS F'R(M OPERATING ACITVITIES
OPERATING IDSS
ADJUS'IMENIS RE(DNCILING OPERATING IDSS
TO NEI' CASH PROVIDED BY OPERATING
ACITVITIES :
D=preciation
Payrænts to contractors (KSU projects)
B:1sis of asset sold
B:1sis of asset received
mANGES IN ASS1~ AND LIABILITIES:
Decrease ( :increase) in aaxxmts recei vahle
Increase (decrease) in aaxxmts payable
Increase (decrease) in acc:rued expenses
Decrease ( increase) in prepaid expense
Increase (decrease) deferred maintenance
Increase (decrease) in deferred rent
Increase ( decrease) in asset sale
related liability
NEI' CASH FROVIDED BY OPERATING ACITVITIES
December 31 ,
1995 1994
$ (342,086)
$ (353,133)
636,897
(1,078,588)
422,606
(113,055)
597,482
(2,000,385)
5,247
(3,893)
22,470
848
(2,257)
2,567
(20,208)
542
(950)
4,014
10,579
28,624
50£000
$ (424,699)
$(1,707,980)
NONCASH CAPITAL TRANSACrIONS
D.Irin;J 1995 the Authority received in a lam exc.harge lam havin;J a value
of $113,055. ][)Jrin;J 1994 the Authority junked equiprent havin;J a basis of
$5, 247 am traded equipnerrt havin;J a basis of $5,489.
See notes to financial stateIænts
( 21)
SALINA AIRFüRI' AUIHORITY
NOIES 'ID FINANCIAL STATEMENTS
December 31, 1995 and 1994
NOI'E 1:
ORGANIZATION AND SUMMARY OF SIGNIFICANI' ACOXJNI'ING roLICIES
A. ORGANIZATION - '!he Salina Airport Authority (the "Authority") is an
authority established by the City of Salina, pursuant to Chap1:er
27, Article 3, of the Kansas statutes Annotated. '!he Authority was
established for the purpose of acquiring surplus federal government
property specifically the Schilling Air Force Base located near
the City of Salina. '!he Authority administers the airport,
ccrnrærcial developænt and rental of associated real estate.
B.
REFORl'ING ENITl'Y - '!he Authority's Board consists of five members
appointed by the city camnission of the City of Salina.
Based upon the degree of fiscal responsibility exercised by the
Authority's Board, the Authority is considered a canponent unit
of the City of Salina urrler the criteria set forth by the Gove!J:1'1I1\eIltal
Accounting Standards Board (GASB) statement No. 14.
In reaching the above conclusion, the Authority considered the!
following reporting entity definition criteria:
1.
Legally Separate Organization - '!he Authority has its own
name, has the right to sue and be sued in its own name with-
out recourse to a state or local governmental unit and has
the right to buy, sell, lease and Irortgage property in its
own name .
2.
Imposition Of Will - '!he City of Salina, although appoint-
ing all Board Iœ!Inbers, may not remJVe appointed members: at
will, may not IOCrlify or approve the budget of the Authority,
may not IOCrlify or approve rates of fees charged, may not
veto, overrule or IOCrlify the decisions of the Board aId the
City does not have the ability to appoint, hire, reassign
or dismiss persons responsible for the day-to-day opera.tions
of the Authority.
Financial Benefit Or a.u:ùen - '!he City is not legally
enti tied to and cannot otherwise aa::ess the resources of
the Authority nor is the City legally à:>ligated to assuræ
the obligation to finance the deficits or provide financial
su¡:p:>rt to the Authority. '!he City is not obligated for the
debt of the Authority.
3.
(22)
4.
Financial Accountability - '!he Authority detennines its
budget without the City havinq the authority to approve or
no:lify that budget.
K.S.A. 27-322 (a) provides that with the consent of the
city, the Authority may annually levy a tax not to exceed
three mills on each dollar of assessed tangible valuation
of the property of the City for the furtherance of the
purpose of the Authority. '!he Authority has levied 1.9 mills
,vhich provided $406,232 'Which was used for capital improvements
in 1995.
](.S.A. 27-322(b) provides that if the Authority is
required to provide matching furrls in order to qualify
for any federal or state grant relatinq to the develop-
ment, improveIæl1t, operation of maintenance of the public
airport, am such furrls are not otherwise available fran
Jrevenue of the airport facilities, the Authority may levy
a tax of not to exceed one mill for such ¡;x.rrposes without
'the consent of the goverTlin;J bcxly of the City. '!he
Þ.uthority does not currently levy urrler this provision.
JK.S.A. 27-322 (a) provides that the Authority shall have
.the power to issue its own general obligation bonds with
"the approval of the goverTlin;J bcxly of the City. once the
approval of the City Commission is granted, the Authority,
by resolution, issues its general obligation bonds 'Which
provides that the Authority will armually levy a tax
:sufficient to pay the principal am interest on the bonds
as they becoIre due. '!he statute further provides that"
"'!he full faith am credit of the Authority
shall be pledged to the payment of the general
obligation bonds of the Authority, including
principal am interest, am the Authority shall
armually levy a tax on all taxable tangible
property within the City, in addition to all
other levies authorized by law I in an annmt
sufficient to pay the interest on am the
principal of the bonds as the saræ becoIre due."
C.
ihe Authority does not currently levy urrler this provision.
BASIS OF ACCXXJNI'ING - '!he Authority consists of an enterprise furrl.
Enterprise funds are classified as proprietary funds by the GASB
am are acx::ounted for usinq a total economic resource measurement
fecus. '!he enterprise furrl is used to acx::ount for operations that
are firlanced am operated in a manner similar to private business
enterprises. '!he intent of the Board is that the costs of pro-
viding services on a continu.in:J basis be recovered through user
fees and rents. '!he financial statements are prepared on the
accrual basis of acx::ounting. Urrler the a<XrUal basis, revenues are
recx:)<]nized as earned arrl expenses as incurred.
(23)
D.
CASH AND CASH ~ - For the purpose of the carnparati VE~
statement of cash flows, the Authority considers all highly
liquid investments (including restricted assets) with maturities
of three months or less when purchased to be cash equivalents"
E.
INVES'IMENTS - Investments relating to the deferred a:xnpensation plan
are reported at market value. All other investments are reported at
cost. '!he Authority's other investments consist of Certifica1:es of
D?posit.
F.
PROPERI'Y AND ~JHMENT - On September 9, 1966, the united sta1:es of
Anerica pursuant to section 13 (g) of the Surplus Property Act of
1944, transferred certain portions of the Schilling Air Force Base
to the Authority.
Property am equipnent assmæd by the Authority on SepteInber 9,
1966 is carried at fair market value at that date of $529, 872
less accumulated depreciation of $44,180. SUbsequent additions
to property am equipnent are recorded at cost.
Maintenance am repairs are expensed as incurred. When prope1:ties
are disposed of, the related cost am accumulated depreciation are
removed fran the respective accounts am any gain or loss on clis-
position is credited or charged to operations. Runways, taxiways,
parJd.n;J areas, sewers am other similar items are written off when
fully depreciated unless clearly identified as still being in use.
Assets are depreciated using the straight-line metha:l over th€~
estimated useful lives of the assets as follows:
Buildings am Improvements
Infrastructure Items
Equipnent
Years
5-50
10-40
5-25
Depreciation applicable to certain property am equipnent which
have been furrled by or contributed to the Authority by the federal
government is d1a1:ged against the respective capital grant equity
balance. '!his d1a1:ge is effected by transferrirg the applicable
depreciation fran retained eamin;Js am has no effect on i.ncat1e.
In accordance with Financial Accountirg st:anjard Board state.rænt
No. 62, interest durirg construction periods, when significant, is
capitalized am included in the cost of property ani net invesbænt
in financirg leases. In 1995 am 1994 no interest was capitalized.
(24)
G.
B:>Nœ ISSUE CDSTS - 130m issue costs are deferred am am::>rtized
us~ the straight-line nethcx:l over the life of the barns to which
it rela1:e5.
H.
<XMPENSATED ABSENCES - SUbstantially all full-tiIæ employees
receive <:::al'Ipel1Sation for vacations, holidays, illness am certain
ather qualify~ absences. '!he number of days compensated for
various categories of absence is generally based on length of
service. Liabilities relat~ to these absences are recognized
as incu:rred ar:rl included in accrued expenses. '!he anount of
accrued vacation pay at December 31, 1995 am 1994 was $7,447
ar:rl $7,382 respectively.
CAPITAL GRANT FUNΠ- Certain experxlitures for capital :improve-
ments :r-.=ceive significant federal fur:rling through the AiI:port
Improvement Program (AlP) of the Federal Aviation Administration
(FAA). '!he Authority fur:rls the reroai.nirg balance of such experxli-
tures. Capital fur:rling provided urrler government grants is con-
sidered earned as the related awroved capital :improveIæl1t expen-
di tures are disbursed .
1.
J.
INVEN'lU.RY - '!he Authority maintains no significant inventory of
office am maintenance supplies. '!hese items are expensed as pur-
chased am no inventory is recorded in these financial statements.
K.
ALI..CMANCE FOR UNCDLIECI'IBIE ACOXJNI'S - '!he Authority calculates its
allowance for specific aCXX)1.lllts us~ specific aCXX)1.lllt analysis.
L.
IEASES - '!he Authority is a lessor urrler mnærous lease agreerænts.
'!he leases are classified as operat~ leases, except for certain
special facility leases which are aCXX)1.lllted for as direct financ~
leases.
M.
TAXES - '!he Authority is exenpt fran payrænt of federal ar:rl state
inccxæ, property ar:rl certain ather taxes. '!he Authority is subj ect
to property tax on non airport use property acquired after 1990.
mrx:;EI'S - '!he Authority is specifically exenpt fran Kansas Budget
law. 'Ihe Authority is not required to denonstrate statuto:ry can-
pliance with its armual operat~ budget. Accord.Ï.DJly, budgetary
data is not included in the financial statements.
N.
(25)
NOIE 2: CASH , CASH ~ AND INVES'IMENT SECURITIES
Cash, cash equivalents arrl investment securities included in the com-
parative balance sheets consist of the following:
December 31 ,
1995 199:1
Cash arxl cash equivalents
CUrrent
Restricted
Total Cash arxl Cash Equivalents
$ 472,008 $ 651,512
526,385 L 359,740
998,393 2,011,252
60,000
48,925 49,967
Irwestment securities - restricted
Deferred canpensation plan assets
Total Cash, Cash Equivalents arxl
Irwest:ment Securities
$1,047,318
$2,121,219
Kansas statutes authorize the Authority to invest in United States
Obligations, secured rep.IrChase agreements, certificates of deposit,
tiIæ deposits arxl open acc:x:>unts.
'!he can:yin;J am:JlUlt of deposits arxl investments securities by type: of
investment are as follONS:
carrvinCJ value
December 31,
1995 1991
Cash deposits
certificates of deposit
'Ibtal Deposits
$ 978,393 $2,011,252
20,000 60,000
998,393 2,071,252
48,925 49,967
$1,047,318 $2,121,219
Deferred canpensation plan assets
Total Deposits arxl Irwesbænt Securities
(26)
Deposits of the Authority with financial institutions are catagorized
by credit risk as follows:
December 31
1995
1994
carry ing
Value
Bank
Balance
carrying
Value
Bank
Bal ance
Cash on dep::sit
Insured by federal
deposit insurance
corporation
Collateralized with
securities held
by pledgirq
financial institution
in Authority's ~
$
300,000
$
300,000
$
300,000
$
300,000
695L291
771L744
1. 771. 202
1. 803 . 690
995,291
1,071,744
2,071,202
2,103,690
Cash on hard
(petty cash)
50
50
$ 995,341
$1,071,744
$1,071,252
$2,103,690
'!he Authori1t.y's deposits are entirely covered by federal depository
insurance or by collateral held by pledging financial institutions in
the Authori 1t.y 's ~ .
(27)
NOI'E 3: RESTRI CI'ED ASSEI'S
Restricted assets consists of the following at December 31, 1995 ard1994:
1995
Cash ani
Cash Total Total
Equivalents Invesbnents 1995 1994
RESTRI CI'ED BY ff>ND
AGREEMENI' :
Bard reserves:
Revenue borrls-85 $ $ $ 90,000
Leasehold borrls-91 85,000 85,000 85,000
INl'ERLOCAL AGREEMENI'
KSU / SALINA SAIES
TAX 182,885 182,885 1,244,740
FEDERAL AVIATION
AŒINISTRATI ON
AGREEMENI' lAND SAlE
PROCEEI:S 258,500 258,500
DEFERRED a::MPENSATION
PIAN 48.925 48.925 49.967
$ 526,385 $ 48,925 $ 575,310 $1,469,707
All restricted amounts are held by the Authority except for assets in the
deferred canpensation plan which are held by the trustee of the plan.
(28)
Revenue Borns-1985:
'lhe proceeds of the 1985 revenue borns were used to construct buildings
that were lE~ to a manufacturing tenant of the Authority. 'lhe leases
are financing leases that transfer o.vnership of the buildings at the end
of the lease. 'lhe bond agreerœnts established certain reserve requireIrel1ts
which the Authority has met.
Leasehold Revenue Bonds-1991:
'lhe proceeds of the 1991 leasehold revenue bonds were used to construct a
building that was leased to a state university. 'lhe lease is a financing
lease that 1:ransfers o.vnership at the end of the lease. 'lhe bond agreerœnt
established certain reserve requirerænts which the Authority has met.
Interlocal saløs Tax AgreeIænt:
'lhe Authori'ty has entered into an Interlocal Cooperation AgreeIænt with
the Kansas JBoard of Regents, a state agency of Kansas; Kansas state
University, a state university; arrl the City of salina. Under this
agreerœnt, the Authority received fran the city the proc:eeds fran a 1/2
cent retail,eI'S sales tax, holds arrl invests these receipts arrl in
aexx>rdance 'with agreed procedures disburses these proc:eeds for lirprove-
ments to the KSU-salina ca:rt'IfA1S.
'lhe following schedule summarizes the activity urrler this agreerœnt.
Year Ended December 31
1995 1994 Prior - Total
Acx::ount beginning balance $1. 244.740 $3.178.681 $ - ~
Receipts
Retail sales tax - - 5,039,950 5,039,950
Interest 16.734 66.444 265.396 348.574
Total ¡;~ipts 16.734 66.444 5.305.346 5.388.524
Disbursements
Residenœ~ hall - (2,350) 802,350 800,000
South bourrlary road - 6,000 - 6,000
North bourrlary road - 1,997 245,762 247,759
Main entrance - - 71,351 71,351
Infrastructure equi¡:rænt 39,266 818,873 70,000 928,139
College center 1,039,323 1,193,911 233,543 2,466,777
Technical center - (18.046) 703.659 685.613
Total D isburseIænts 1. 078 . 589 2.000.385 2.126.665 5.205.639
Account Balance $ 182,885 $1,244,740 $3,178,681 $ 182,885
'lhe North ]3OOrrlary Road arrl South Bourrlary Road lirproveIrel1ts am any
dedicated utility lirprove.tœ.nts const:IUcted with sales tax proc:eeds be-
cane the property of the City of salina. All other capital lirproveIrel1ts or
capital equi¡:rænt paid for with sales tax proceeds becc:JIæ the property
of the sta1te of Kansas.
(29)
NOI'E 4: NEI' INVES'IMENI' IN FINANCING IFASES
Net invesbænt in financing leases consist of the following:
December 31
1995 1991
MiniIrn.1m lease payments to be
received
less : Unean1€d income
$3,904,877
1.804,226
Net invesbænt in financing leases
$2,100,651
See Note 3 for projects financed through these leases.
Activity in net invesbnent in financing leases was as follows:
$4,581,101
2,172,436
$2,408,665
Year Errled
December 31 ,
1995 1994
Beg innirg bal ance
Collected principal
Principal sold
Building additions
$2,408,665
(191,920)
(116,094)
Errling balance
$2,100,651
$2,570,416
(178,446)
16,695
$2,408,665
NOI'E 5: NEI' INVES'IMENI' IN FIXED ASSEI'S AND CDNS'IRJCI'ION IN PROGRESS
Net invesbænt in fixed assets consists of the following:
December 31 ,
1995 1994
FIXED ASSEI'S:
I.anj
BuildinJs am iltproveœnts
Airfield am infrastructure
Equipænt
$ 2,419,909 $ 2,206,748
6,493,465 6,347,198
11,739,108 8,135,769
1,009,339 996,295
less-acx::umulated depreciation
21,661,821
(6,396,331)
Net Fixed Assets
$15,265,488
No interest was capitalized in 1995 or 1994.
(30)
17,686,010
(5,759,434)
$11,926,576
Activity in the fixed asset aCCO1.ll1ts for 1995 was as follows:
Bui I ding arrl Airfield arrl
land ImProvements Infrastructure Equipment
Beginning balance $2,206,748 $6,347,198 $ 8,135,769 $ 996,295
Additions 262,931 403,007 3,603,339 13,044
Disposals ( 49,770) (256,740) - -
Ending balance $2,419,909 $6,493,465 $11,739,108 $1,009,339
Basis assets sold is $49,770 land, $256,740 buildings arrl $116,094 capital
lease building $422,604.
NOl'E 6: RENTAL llicx:t1E UNDER OPERATING lEASES
A significant portion of the operating revenue of the Authority is
generated through the leasing of airport arrl building space to airport
fixed base operators arrl others on a fixed fee as well as a contingent
rental basis. O1rmership risks are retained by the Authority arrl,
accordingly such leases are treated as operating leases.
'Ihe following is a schedule of minimum future rentals on noncancellable
operating leases to be received in each of the next five years arrl
thereafter :
Years ended
December 31,
1996
1997
1998
1999
2000
Later years
$
861,602
590,410
485,261
345,050
306,080
831£305
'Ibtal
$3,419,708
( 31)
NC1l'E 7: IDNG TEE\M DEB!'
Builclin:J revenue borrls series 1985, originally
issued D:cember 1, 1985, due in aruroal installIænts
of $130,000 for 1994 arrl interest at 80% of the bêIse
lerrli.ng rate of '!he National Bank of America, Salina ,
Kansas .
General obligation economic development borrls
series 1990A, originally issued July 1, 1990 due
in annual installIænts increasinJ iran $45,000 in
1992 to $175,000 in 2010 plus interest ranginJ iran
6.4% to 8.375%
General obligation economic development borns
series 1990B, originally issued October 1, 1990
due in annual installIænts increasinJ iran $20,000
in 1992 to $70,000 in 2010 plus interest ranginJ
iran 6.5% to 8.5%
leasehold revenue borrls series 1991, originally
issued November 1, 1991, due in annual installments
increasinJ iran $35,000 in 1992 to $90,000 in 2006
plus interest ranginJ iran 5% to 7.25%
General obligation borrls series 1993A, originally
issued D:cember 1, 1993, due in aruroal installments
increasinJ iran $35,000 in 1994 to $45,000 in 2003
plus interest at 3.4% to 5%
General obligation borrls series 1993B, originally
issued December 1, 1993 due in annual installments
increasinJ iran $25,000 in 1994 to $35,000 in 2003
plus interest at 3.85% to 4.75%
Total
Less current maturities
IDng-tenn debt, less current maturities
IE::ember 31,
1995 1994
$
$
130,000
1,645,000
1,705,000
665,000
690,000
700,000
740,000
310,000
340,000
230,00q 250,000
3,550,000 3,855,000
190,00q 305,000
$3,360,000 $3,550,000
'!he proceeds of all of borrls issued 1985 through 1991 were used to
p.trd1ase or construct ccmnercial real property transferred urrler direct
financinJ leases. (See Note 4). '!he borrls are expected to be repaid fran
proceeds of the financinJ leases.
(32)
'Ihe proceeds of the series 1993A borrls are to be used to finance inprove-
IæIrt:s to the Airport am the proceeds of the series 1993B borrls are to be
used to finance matching :furrls for a Federal Aviation Administration grant.
'!he 1993A ani 1993B series borrls are to be repaid frcm the general revenue
of the Authority.
'!he armual }:x:>m principal for all borrls outstarrling as of December 31, 1995,
are as follows:
Payable in General Leasehold
Year Errled Obligation Revenue Interest
December 3 1 Borrls Borrls Payments Total
1996 $ 145,000 $ 45,000 $ 229,729 $ 419,729
1997 155,000 50,000 216,772 421,772
1998 165,000 50,000 205,178 420,178
1999 180,000 55,000 193,055 428,055
2000 190,000 60,000 179,643 429,643
'!hereafter 2.015.000 440.000 899.372 3.354.372
Total $2,850,000 $700,000 $1,923,749 $5,473,749
'!he armual 100m interest
are as follows:
Payable in General Leasehold Total
Year Errled Obligation Revenue Interest
December 31 Borrls Borrls Payments
1996 $ 182,251 $ 47,478 $ 229,729
1997 171,995 44,777 216,772
1998 163,475 41,703 205,178
1999 154,503 38,552 193,055
2000 144,638 35,005 179,643
'!hereafter 782.402 116.970 899.372
Total $1,599,264 $324,485 $1,923,749
for all borrls outst.arrlin:J as of Decernber 31, 1995,
(33)
Activity in long tenn debts for 1995 was as follows:
Beg Í1lnÍn;J Borrls Principal JErrling
Balance Issued Paid JBalance
Building Revenue Borrls
Series 1985 $ 130,000 $ $130,000 $
General Obligation Eco1'1Œlic
Developnent Borrls
Series 1990A 1,705,000 60,000 1,645,000
General Obligation Eco1'1Œlic
Developænt Bonds
Series 1990B 690,000 25,000 665,000
leasehold Revenue Bonds
Series 1991 740,000 40,000 700,000
General Obligation Bonds
Series 1993A 340,000 30,000 310,000
General Obligation Bonds
Series 1993B 250,000 20,000 230,000
Totals $3,855,000 $ $305,000 $3,550,000
(34)
N<Jl'E 8: DEFINED BENEFIT PENSION PIAN
SUbstantially all employees of the Salina Airport Authority participate
in the KansélS Public Employees Retirement System ("System"), a multiple
employer public employee cost sharing retirement system. '!he payroll for
employees covered by the System for the years errled December 31, 1995 and
1994 was $341,755 and $316,204. The total payroll was $364,978 and $350,768
respectively.
SUbstantially all employees of the Salina Airport Authority are eligible
to participate in the System after one year of employment. Employees who
retire at or after age 65 or age 62 with ten years service credit or at any
age when years of service plus age equal 85 "points" are entitled to a
retirement benefit, payable monthly for life, equal to one percent of their
final averaqe salary for each year of "prior" service and 1. 75 percent for
each year of "participatingll service. Final average salary is the employee's
average salary over the higher of four years of credited service, including
add-ons SUd1 as accrued sick leave and vacation leave or a three year average
without add'-ons. For those hired July 1, 1993 or later, final average salary
is a three year average with no add-ons. Benefits fully vest on reaching ten
years of service. Vested employees may retire at age 55 and receive reduced
retirement benefits. The System also provides death and disability benefits.
Benefits are established by state statute.
COVered employees are required by state statute to contribute four percent
of their salary to the plan. '!he employer is required by the same
statute to contribute the remaining amounts necessary to pay benefits
when due. 'Ihe contribution requirement for the years errled December 31,
1995 and 1994 was $21,530 and $20,994, which consisted of $7,860 and
$6,870 from the employer and $13,670 and $14,124 from employees, respectively;
these contributions represented 2. 3 percent and four percent of covered
payroll respectively. Employer contribution required of all participating
entities for the year errled June 30, 1995 was $129,083,585.
'!he "pension benefit obligation" is a standardized disclosure measure
of the present value of pension benefits, adjusted for the effects of
projected salary increases and step-rate benefits, estimated to be
payable in the future as a result of employee service to date. '!he
measure, which is the actuarial present value of credited projected
benefits, is interrled to help users assess the System's furrling status
on a going concern basis, assess progress made in accumulating
sufficient assets to pay benefits when due, and make comparisons among
Public Employee Retirement Systems and employers. '!he System does not
make separate measurements of assets and pension benefit obligation for
individual employers. '!he pension benefit obligation at June 30,
1995 for the System as a whole, detennined through an actuarial
valuation ¡:erfonned as of that date, was $6.99 billion. '!he System's
net assets available for benefits on that date (valued at market) were
estimated tD be $5.51 billion, leaving an unfunjed pension benefit obligation
estimated at $1. 48 billion. '!he contribution of the Salina Airport Authority
for the period. covered by this report represents. 01 percent of total
contributions required of all participating entities.
'!he ten-year historical trend infomation showing the System's progress
in accumulating sufficient assets to pay benefits when clue is presented
in the Syst:.ern's June 30, 1995 Comprehensive Annual Financial Report.
(35)
NOI'E 9: DEFERRED ca1PENSATION PIAN
'!he Authority offers its employees a deferred compensation plan formed
in accordance with Internal Revenue Code Section 457. '!he plan,
available to all employees, permits them to defer a portion of thE~ir
salary until future years. '!he deferred compensation assets, which are
funded currently with a third party trustee, are not available to
employees until termination, retirerœnt, death or unforeseeable
emergency .
All amounts of compensation deferred un:ler the plan, all property and
rights purchased with those amounts, and all income attributable t:o
those amounts, property, or rights are (until paid or made available to
the employee or other beneficiary) solely the property and rights of
the Authority, subject only to the claims of the Authority's general
creditors. Participants' rights un:ler the plan are equal to thOSE~ of
general creditors of the Authority in an amount equal to the fair
market value of the deferred account for each participant.
It is the opinion of the Authority's legal counsel that the Authority
has no liability for losses un:ler the plan but does have the duty of
care that would be required of an ordinary prudent investor. '!he
Authority believes that it is unlikely that it will use the assets to
satisfy the claims of general creditors in the future.
Authority payroll and contributions of employees electing to partici-
pate follows:
December 31 ,
1995 1994
Authority's total payroll
Electing employees payroll
Electing employees contributions
$371,231
148,325
5,890
$350,768
173,022
5,750
'!he Authority offers no post employrænt benefits other than those
available through Kansas Public ErrployIœl1t RetireIœnt.
NOI'E 10: REI'AINED EARNINGS AND CXJN'IRIBJI'IONS IN AID
Under the provisions of various bond agreerænts, certain assets éilB
restricted for specific uses (Note 3). Retained earnings which have
been reserved relating to these restricted assets consist of the
following:
December 31 ,
1995 1994
Reserved retained earnings:
Bond reserves:
Revenue boOO5-85
Leasehold boOO5-91
$ $ 90,000
85.000 85.000
85,000 175,000
7.263.414 6.713.995
$7,348,414 $6,888,995
Reserved retained earnings
Unreserved retained earnings
Total retained earnings
Board designated restricted assets are not reported as reserved retained
earnings .
(36)
O1anges in qrants and contributions are surnmarizerl as follows:
Ferleral Aviation
Administration
B:ùance January 1, 1994
$4,394,851
1994 additions, AlP grants
270,191
Lepreciation on property and equipment
acquired by goverrnnent grants
(363,217)
Balance Deo;:m¡ber 31, 1994
4,301,825
1995 additions, AlP grants
3,210,933
Depreciation on property and equipment
acquired by goverrnnent grants
(391, 749)
Balance ~ernber 31, 1995
$7,121,009
NOTE 11: MAJOR æS'I'ŒŒRS
'!he Authority receives significant operating and capital lease revenue
from Schwan's Sales and Raytheon Aircraft Company (formerly Beech
Aircraft Corporation). Rentals from these two manufacturers aggregated
approxilnately 40% of operating and capital lease revenue for the year
ended December 31, 1995.
NOTE 12: NON-OPERATING lli<XME
Net non--operating income consisted of the following for the years
ended Decerober 31, 1995 and 1994:
'Ibta1
1995 1994
$406,232 $301,829
231,324 244,643
28,937 28,242
666,493 574,714
58,935 68,300
188,678 198,563
9,124 5.525
256.737 272,388
$409,756 $302,326
Mill levy
Interest and investment income
Financingr leases
Other interest
'Ibta1
Interest expense
Revenue borns
General obligation horns
An¥Jrtizat:ion bom issue costs
Net non-ope!Iâting income
(37)
NOl'E 13:
FRIaR PERIOD ADJUSIMENT
'!he Authority learned in 1995 that certain building leases that had been
accounted for as operating leases should have been accounted for as
financing (sales type) leases. '!he adjustments making the correction has
the following effect on previously published 1994 financial statements:
Cost of buildings January 1, 1994 is reduced
$1,041,907
Accumulated depreciation January 1, 1994 is
reduced
477,755
Beginning retained earnings is reduced
564,152
Depreciation expense and net loss is reduced
22,338
(38)
(>iNVl8 l::Ell A llVNOI1N31NI 3ÐVd SIH1)
(THIS PAGE INTENTIONALLY LEFT BLANK)
SALINA AIRroRI' AUIHORITY
sæFnJIES OF OPERATIONS AND æANGES
ill REl'AINED EARNINGS
J anuarv 1 to December 31.
1995 1994
OPERATING REVENUES
arllcli.rg rents
Ramp rents
Iarrl rents
Agri larrl :vents
Hangar rents
Tank fann :vent
Fixed base ,cperator
Lan:lirg fees
Cctmnissions-car rentals
Gain (loss) on sale of assets
other income
'IDI'AL OPERATING REVENUES
$ 870,701 $ 832,084
29,605 9,458
64,953 47,390
45,663 51,078
34,324 33,493
3,015 1,508
98,429 90,511
13 , 714 10,982
8,316 7,747
(24,024) -
7.623 (1.833)
1.152.319 1. 082.418
OPERATING EXPENSES BEFORE DEPRECIATION
ArMINISTRATIVE EXPENSES
Office salaries
Office SUWlies
Postage
Travel arrl meetings
Legal arrl accounting
Insurance-property / 1 iab i 1 i ty
Insurance-lt edi cal
~ineerÌD;3'
FICA tax
Kansas unerrployment tax
Employees retirement
Tel e¡ilone
Irrlustrial devel opnent
Allport prclrotion
Property taoces
rues arrl subscriptions
Property appraisals
other administrative expenses
160,053
6,685
4,298
11,156
31,710
57,252
45,142
10,354
27,387
356
7,732
8,197
21,254
20,689
38,082
10,217
7,910
13 £ 440
150,303
6,737
4,675
9,981
36,190
62,872
44,260
12,794
26,285
331
6,967
9,135
23,333
8,432
44,359
8,593
3,240
9£316
'IDI'AL AIMINIS'ffiATIVE EXPENSES
$ 481. 914
~
467£803
(39)
MAIN!'mANCE EXPENSES
Maintenance salaries
Bui I di.n;J ma intenance
Airfield maintenance
Gro\,]Djs maintenance
Equipoont gas, oil & repairs
Utilities
Fire depart:nv:mt expense
Aqr i I arrl expense
Other maintenance expenses
'lUI'AL MAINI'ENANCE EXPENSES
'lUI'AL OPERATING EXPENSES BEroRE
DEPRECIATION
OPERATING EARNINGS BEroRE DEPRECIATION
DEPRECIATION EXPENSE
OPERATING IDSS
NON-oPERATING rna:ME (EXPENSE)
Mill levy
Interest ~ i tal leases
Interest incaJ:æ
Born interest -expense
Am:>rtization born costs
NEl' NON-oPERATING rna:ME
NEl' rna:ME (IDSS )
ADD DEPRECIATION ON ASSEI'S A~ 'lHIUJGH
FEDERAL cr.m:RIH1I'IONS (Note 1)
rnCRFASE ( DEX:m'ASE ) rn RE.TAINED EARNINGS
REI'AINED EARN1NGS, January 1
PRIOR PERIOD ADJUS'IMENl'
REl'AINED EARNINGS, December.:.. 31
(40)
J anuarv 1 to December 31,
1995 1994
$ 204,925 $ 200,465
33,574 47,253
24,976 34,471
2,211 3,936
34,213 26,017
58,427 41,052
1,604 4,279
4,857
10.807 12.793
375.594 370.266
857.508 838.069
294,811 244,349
636.897 597.482
(342.086) (353.133)
406,232 301,829
231,324 244,643
28,937 28,242
(247, 613) (266,864)
(9 .124) (5.524)
409.756 302.326
67,670 (50,807)
391. 749 363.218
459,419 312,411
6,888,995 7,140,736
(564.152)
$ 7,348,414 $ 6,888,995
SALINA AIRroRl' AU'lliORITY
CAPITAL EXPENDrruRES
J anuary 1 to December 31 ,
1995 1994
lAND
storage tan}~ removal
Secol'rlary s1:reet replat
storm water prevention
National Guard land
In"provements
$ 10,055
118,804
21,016
113,055
$ 119.800
'IDl'AL rAND
2621.930
1191.800
Ð;PIFMENT
Irrlustrial Center equipænt
Shop equipmE:mt
CcImIunication equipment
Airfield equipment
Office equi}:xnent & remodel
1,162
1,400
757
91.724
4,160
271.129
'IDl'AL Ð,¿{JIFMENT
131.043
311.289
BJIIDINGS AND IMPROVEMENTS
Building #6!50
Building #313
Building #504
Building #1021
Building #394
Building #217
Pumphouse #305
"P"T-Hangar.5
"A & B"T-Hangars
Terminal building improvement
Unit D. IOC
South T-Hanc~
FOUJ'rlation removal
Planned irrlustrial building
ATCI' site
Raytheon aSbestos sm:vey
Runway jTaxhmy milling
Raytheon building #656
Building site preparation
1,205
19,643
12,760
137,186
23,030
39,586
7,838
6,606
29,306
32,360
91,429
4,470
22,987
9,548
9,375
7,500
5,071
17,530
24,765
7,514
1811.732
'IDl'AL IUIIDINGS
4031.009
2881.432
CAPITAL IFASE .M>DITIONS
161.695
AIRFIEID AND INFRASTRUCIURE
AIP 12 Runway protection zone
AIP 13 SUbdrain and vehicle
AIP 14 Airfield signage
AIP 15 Airfield parki.n;J-ramp
AIP 16 Airfield parki.n;J-ramp
AIP 17 Airfield parki.n;J-ramp
'lUI'AL OIHER IMPROVEMENTS
206,453
9,386
800
1,954,873
1,421,239
11.388
3.603.339
185,204
123,161
50
3091.215
'lUI'AL CAPITAL EXPENDrruRES
$4,282,321
$ 765,431
(41)
SALINA AIRFORl' AUlliORITY
GENERAL OBLIGATIOO" EOJNC.MIC DEVEIDæENI' 00Nœ
SERIES 1990A
December 31, 1995
Date of Issue:
Annmt of Issue:
Interest Rate
Maturity Date:
Principal Paid:
Ol.rt:starrli.n Balance:
July 1, 1990
$1,900,000
*
September 1 , 2 0 10
$255,000
$1,645,000
Schedule of Borrl Principal PaVIæIIts
D.1e in
Year
Borrl
Principal
1996
1997
1998
1999
2000
'!hereafter
$
65,000
65,000
75,000
80,000
85,000
1, 275.000
$1,645,000
*'!he interest rate varies fran 8.375% to 6.4%
over the life of the borrl issue .
(42)
SALINA AIRroRI' AU'lliORITY
GENERAL 0 ELI GAT! ON ECX:H:MI C DEVEID IMEN1' 00Nœ
SERIES 1990B
December 31, 1995
IBte of Issue:
AIrount of Issue:
Interest Rate:
Maturity IBte:
Principal Paid:
outstarrli.ng Balance:
october 1, 1990
$773,000
*
september 1 , 2 0 1 0
$108,000
$665,000
SChedule pf Bom Principal Payments
D.1e in
Year
Bom
Principal
$ 25,000
30,000
30,000
30,000
35,000
515,-000
1996
1997
1998
1999
2000
'!hereafter
$665,000
*'!he interest rate varies from 8. 5% to 6. 5%
over the life of the ham issue.
(43)
SALINA AIRroRI' AIJIHORITY
IFASEHOID REVENUE B)NŒ
SERIES 1991
December 31, 1995
D3.te of Issue:
.Annmt of Issue:
Interest Rate:
Maturity D3.te:
Principal Paid:
Q.rt:st.an:ti.n Balance :
November 1, 1991
$850,000
*
September 1 , 2006
$150,000
$700,000
SChedule of Born Principal PaVIœI1ts
D.1e in
Year
Born
Principal
1996
1997
1998
1999
2000
'!hereafter
$ 45,000
50,000
50,000
55,000
60,000
440.000
$700,000
'!he interest rate varies fran 7. 25% to 5%
over the life of the born issue.
(44)
SALINA AIRFORl' AUIHORITY
GENERAL OBLIGATION B:>Nœ
SERIES 1993A
December 31, 1995
rate of Issue:
Am::Rmt of Issue:
Interest Rate:
Maturity rate:
Principal paid:
0Utstarrling Balance:
December I, 1993
$375,000
3.4% to 5%
september I, 2003
$65,000
$310,000
Schedule of Born Principal Pavments
D..1e in
Year
Born
Princi~
1996
1997
1998
1999
2000
'!hereafter
$ 30,000
35,000
35,000
40,000
40,000
l30LOOO
$310,000
(45)
SALINA AIRroRl' AUIHORITY
GENERAL OBLIGATION EONœ
SERIES 1993B
December 31,1995
Date of Issue:
AIoount of Issue:
Interest Rate:
Maturity Date:
Principal Paid:
outstarrli.ng Balance:
December 1, 1993
$275,000
3.85% to 4.75%
september 1 , 2 0 0 3
$45,000
$230,000
SChedule of Born Principal Pavments
llie in
Year
130m
Principal
1996
1997
1998
1999
2000
'!hereafter
$ 25,000
25,000
25,000
30,000
30,000
95.000
$230,000
(46)
lliSURANCE roLICY
Canme.rcial Union Ins. CO .
Pol. #CIH589191 6
National Union Fire Ins. CO.
of Pittsburgh, PA.
Pol. #AP3229456-01
Canme.rcial Union Ins. CO .
Pol. #Cl'R446926
Canme.rcial Union Ins. CO .
Pol. #Cl'R399483
Canme.rcial Union Ins. CO .
Pol. #Pl'AT76054
'!he Hartford
Pol. #PEB DB1019
Coregis Insurance Co.
Pol. #524-210054-4
American AllialI1Ce Ins. Co.
Pol. #KST 788--29-33-01
SALINA AIRroRl' AUIHORITY
lliSURANCE lli FORCE
Deoember 31,1995
TYPE OF CXJVERAGE
Workræn' s CC:.atpenSation
arrl Employer's Liability
Bodily Injury arrl
Property I:arnage
Han;Jar Keepers
Fire arrl Light:nin3",
exteIrled coverage,
varrlalism arrl malicious
mischief
lDss of Rents
Business Personal Prop.
Boiler & Machinery
vehicles & Equipment
Liability
Fhysical damage-equip.
Medical paynents
uninsured IOC>torists
AM:UNI' OF
CX>VERAGE
$ 500,000
$ 500,000
$ 500,000
$7,126,859
$1,607,475
$ 487,400
$1,000,000
$ 500,000
$1,281,380
$ 2,000
$ 500,000
Public Employees Blanket Born.
Honesty blanket
position born. coverage $ 100,000
Public Officials & Empl. Liability
Errors & omissions
excluding asbestos,
excluding pollution coverage
on a clallns made basis,
5,000 deductible
Kansas UST Liability
Environmental incident
Annual aggregate
Limit of Defense
5,000 deductible
(47)
$ 500,000
$1,000,000
$1,000,000
SALINA AIRroRI' AIJIHORITY
sæEIXJIE OF FEDERAL ASSISTANCE
CATAI.£X; OF FEDERAL IXI-ŒSTIC ASSISTANCE NUMBER 20.106
For the year errled December 31, 1995
Federal ID
Number
Expenditures
[).]r in;J
Year
Aniount
of Awards
ProcJram T i tl e
DEPARIMENT OF TRANSFORI'ATION
Federal Aviation Administration 3-20-0072-12
Runway protection zone
$ 206,453
$ 177,314
Federal Aviation Administration 3-20-0072-13
9,386
Federal Aviation Administration 3-20-0072-15
Airfield parJå.rB
1,954,873
1,774,895
Federal Aviation Administration 3-20-0072-16
1,421,239
1,258,724
Federal Aviation Administration 3-20-0072-17
11.388
$3,603,339
$3¡,210,933
(48)
SALINA AIRroRI' AIJlliQRITY
CXMPARISON OF GRa3S CASH BMANCES WI'IH DEIŒI'IDRY SECURITY
December 31, 1995
Bank IV
SalÍl1a..L N .A.
UMB-
National Bank
of America
SunflCMer Bank
GRa3S CASH BA.Il\NCES
DeInand deposit
cash in chE~
Time deposits
CertificatE~ of
deposit
BMANCES SEŒJru\BIE
BY CDLIATERAL
$230,793 $ 669,444 $124,507
- - 20,000
230,793 669,444 144,507
100,000 100,000 100,000
$130,793 $ 569,444 $ 44,507
'IDl'AIS
lESS FDIC CDVEHAGE
SECURITY ~JIHED
(100%)
130,793
569,444
44,507
SEaJRITY' PROVIDED
BY DEIŒI'IDRIES
AmJNr UNDERSÐ:IJRED
BY srA'IUIE
705L290
L 013 ,438
240L810
$
$
$
(49)
Salina Airport Authority
OPERATING REVENUE HISTORY
Ten Years Ended December 31 , 1995
Prev. Years
Gain (Loss) Other Total
Fiscal Rental Fixed Base Landing on Sale of Operating Operating
Year Revenue Operato~ Fees Assets BeceiQts Revenue
-~-~ -~.~.~
1986 772,988 85,050 6,302 (60,543) 17,995 882,335
1987 807,511 87,352 5,988 0 19,726 920,577
1988 783,958 96,133 28,702 83,074 19,217 928,010
U1 1989 791 ,433 106,432 5,913 (414) 23,447 927,225
0
1990 736,242 127,765 7,599 0 9,220 880,826
1991 762,984 89,079 4,271 0 11,002 867,336
1992 791,974 82,345 5,565 0 16,136 896,020
1993 800,575 78,392 7,616 0 43,744 930,327
1994 975,011 90,511 10,982 0 5,914 1,082,418
1995 1,048,563 98,429 13,714 (24,024) 15,637 1,152,319
Source: Salina Airport Authority Records
Salina Airport Authority
OPERATING EXPENSE HISTORY
Ten Years Ended December 31 , 1995
Offi ce & Total
Administrative Maintenance Operating
Fiscal Year ExQense Exp~nse ~~Qens~
1986 294,798 284,918 579,716
1987 386,227 364,978 751,205
1988 456,770 326,346 783,116
1989 483,907 336,117 820,024
~
U1
f--1 1990 430,225 338,936 769,161
1991 408,578 329,137 737,715
1992 415,819 347,498 763,317
1993 458,918 361 ,41 2 820,330
1994 467,803 370,266 838,069
1995 481,914 375,594 857,508
Source: Salina Airport Authority Records
Salina Airport Authority
FEDERAL FINANCIAL ASSISTANCE HISTORY
Ten Years Ended December 31 , 1995
---~.__._--- --.
Fiscal Year
Federal J~ viation
Administration
Airport
Lrrœroveml:m~_raQ!
1986
126,055
1987
2,180,711
1988
980,986
1989
613,642
1990
40,917
1991
29,430
1992
335,349
1993
30,162
1994
270,191
1995
3,210,933
NOTE:
The use of Federal Aviation Administration Airport Improvement Program
Grant Funds are limited to use for funding specific airfield capital improvements.
Airfield capital improvements are detailed in program grant agreements
entered into by the Salina Airport Authority and the Federal Aviation Administration
The grant funds finance 90% of total project costs.
Source: Salina Airport Authority Records
(52)
Salina Airport Authority
CAPITAL EXPENDITURE HISTORY
Ten Years Ended December 31,1995
Buildings & Total
Fiscal Capital Lease Capitai
Year Equipment Additions Land Airfield ExQenditlJ_res
~.~._~
1986 48,267 443,071 345,058 172,157 1,008,553
1987 39,427 61,609 - 2,522,063 2,623,099
1988 9,618 886,650 - 1 ,034,7 41 1,931,009
1989 94,524 2,243,128 - 648,583 2,986,235
~
U1
w
1990 17,489 1,700,740 130,590 32,943 1,881,762
1991 36,268 400,406 - 62,257 498,931
1992 2,516 803,418 131,845 357,586 1,295,365
1993 20,773 134,602 250,279 33,692 439,346
1994 31 ,289 305,127 119,800 309,215 765,431
1995 13,043 403,009 262,930 3,603,339 4,282,321
Note:
Federal Aviation Administration grants fund 90% of airfield improvements
Source:
Salina Airport Authority Records
Salina Airport Authority
REVENUE BOND COVERAGE
Ten Years Ended December 31, 1995
Fiscal Pledged Revenue Bond
Year Revenue Debt Service Coverage
1986 594,313 191,046 3.11
1987 597,978 195,640 3.05
1988 416,188 192,203 2.16
~ 1989 523,307 214,586 2.43
lJ1
.¡:,.
1990 409,915 211,780 1.93
1991 426,707 206,570 2,06
1992 531,761 286,024 1.86
1993 414,514 278,395 1.50
1994 421,554 280,578 1.50
1995 189,446 92,478 2.05
Notes:
1. Revenues pledged to service Leasehold Revenue Bonds, Series 1991
Source: Salina Airport Authority Records
Salina Airport Authority
PRINCIPAL CUSTOMERS
Year Ended December 31,1995
Palleton of Kansas, Inc.
%of
Operating &
Direct Finance
Rev~nlJ~ Lease Revenue
296,088 20.1%
233,919 15.9%
189,446 12.9%
142,140 9.7%
108,600 7.4%
70,113 4.8%
58,752 4.0%
48,169 3.3%
27,996 1.9%
20,216 1.4%
18,995 1.3%
18,600 1.3%
18,000 1.2%
17,357 1.2%
15,725 1.1%
CompallY
Schwan's Sales Enterprises, Inc.
Raytheon Aircraft Company
Kansas State University - Salina
Exide Corporation
Soo Plastics, Inc.
Moore's Midway Aviation, Inc.
KASA FAB, Inc.
Flower Aviation of Kansas, Inc.
GeoCore SeNices, Inc.
Mac Air/Avis
Salina Vortex Corporation
Federal Aviation Administration
Haahjem NA, Inc.
M&K Carpet Warehouse & Decorating Center
Note:
Total of Operating Lease and Direct Finance Lease Revenue for
1995 was $1,470,115
Source: Salina Airport Authority Records
(55)
Salina Airport Authority
LOCAL GOVERNMENT PROPERTY TAX RATES, DIRECT AND OVERLAPPING
Ten Years Ended December 31, 1995
Other
Unified Salina State Special
Fiscal Saline City of School Airport of Taxing
Year County Salina Dist. #305 Authority Kansas Districts Total
1986 21.000 36.360 80.048 - - 5.777 143.185
1987 21.000 36,360 81.873 - - 5.790 145.023
1988 21.000 36.360 88.779 - - 6.487 152.626
1989 23.460 36.360 95.639 - - 6,653 162.112
U1 1990
0"'\ 19.074 30.015 76.492 - - 5.599 1 31 .1 80
1991 20.122 30.028 79.4 72 - - 5.818 135.440
1992 20.464 29.828 83.372 - - 6.074 139.738
1993 24.562 29.461 40.685 1.900 1.5 5,121 103.229
1994 26.575 28.709 42.401 1,900 1.5 5.015 106.100
1995 23.370 27.145 42.287 1.372 1.5 5.393 101.067
Note:
The Salina Airport Authority's 1995 mill levy will be available during calendar year 1996
and is budgeted for 1996.
Source:
Saline County Clerk
Salina Airport Authority
PROPERTY TAX REVENUE
Ten Years Ended December 31 , 1995
Fiscal Year
Property Tax
Revenue
--~
1986
36,445
1987
227
1988
0
1989
0
1990
0
1991
0
1992
0
1993
0
1994
301 ,829
1995
406,232
Source: Salina Airport Authority Records
(57)
Salina Airport Authority
AIR TRAFFIC, FUEL FLOWAGE ANO'ENPLANEMENT TRENDS
Ten Years Ended December 31 1995
Scheduled
Fiscal Fuel Flowage Air Service
Year Ai r Traffi c Gallons Enplanements
1986 64,846 2,190,069 6,987
1987 60,678 2,547,120 8,721
1988 80,411 2,872,298 9,159
1989 79,068 2,890,341 10,252
U1 1990 96,254 3,136,668 5,707
CXJ
.......
1991 83,372 2,681,605 5,391
1992 71,697 2,552,156 5,799
1993 66,144 2,126,230 5,591
1994 61 ,215 2,424,880 7,175
1995 68,291 2,435,656 7,813
Source: Salina Airport Authority Records
Salina Airport Authority
MAJOR EMPLOYERS IN THE SALINA/SALINE COUNTY AREA
I\ ~inr Dri,,~tø F=mnlnv~r~
"""P"" .......- -"""'-J-'-
Company
U1
\..0
Tony's Pizza
Salina Reg. Med. Center-Santa Fe
Great Plains Manufacturing
Raytheon Aircraft Co.
Exide Corporation
Salina Reg. Med. Center-Penn Campus
Phillips Lighting Co.
Western Auto
Morrison Grain
Eldorado National, Inc.
School Specialty Supply
Crestwood Cabinets, Inc.
Malor Public Employers
Public Body
Unified School District #305
City of Salina
Saline County
Kansas State University - Salina
Source: Salina Area Chamber of Commerce
Approx. #
Employ~~s
2,150
842
819
620
610
575
570
240
200
170
165
120
Approx. #
EmpLQYees
1746
740
144
126
Type of
Business
Frozen Foods Manufacturer
Health Care
Farm Implements
Aircraft Sub-assemblies Manuf.
Battery Manufacturing
Health Care
Fluorescent Lamp Manufacture
Warehouse Distribution
Agricultural Products
Medium & Small Shuttle Buses
Ed./Commercial Printing/Dist.
Custom Made Cabinets
Iy~e of Public E3ody
School System
City Government
County Government
Engineering Technology College
Salina Airport Authority
SALINA POPULATION, DEMOGRAPHIC AND
lABOR STATISTICS
Populé31ion
Year
Çity of~aljn~
~alin_~ ColJllly
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
41,932
42,007
42,092
42,188
42,303
42,510
42,841
43,202
43,304
43,304
48,973
49,062
49,155
49,210
49,301
49,301
49,301
49,400
50,450
50,450
Source: Saline County Clerk
[)_e m 0_9 r~j)h iç~
Measure
City of Salina
Median Age
Average # Per Household
Number of Households
Median Effective Buying
Income by Household
Effective Buying Income
(000)
35.54
2.4
18,456
$30,893
$624,244
Source: Salina Area Chamber of Commerce
Labor
Civilian
year Labor Force Employed U(lemployed Ra1t~
1989 27,384 26,130 1.250 4.6'7'0
1990 28,454 27,261 1,193 4.2%
1991 29,321 28,073 1,248 4.3%
1992 30,409 29,270 1,139 3.7%
1993 28,549 27,261 1,288 4.5%
1994 28,902 27,692 1,210 4.2%
1995 29,312 28,117 1,195 4.1%
Source: Salina Area Chamber of Commerce
(60)
() NVl8 l::l3l A llVNOI1N31NI 39Vd SIH1)
HARRISON & ARNETT
CHARTERED
CERTIFIED PUBLIC ACCOUNTANTS
EUGENE O. HARRISON, C.I'A.
THOMAS G. ARNETT, C.P.A.
719 EAST CRAWFORD. SALINA, KANSAS 67401
PHONE: (913) 827.7244
FAX: (913) 827.0048
INDEPENDENI' AUDrIDR' S REfORI' ON INI'ERNAL mNI'ROL srnuCIURE
BASED ON AN AUDIT OF FlliANCIAL STATEMENl'S PERFORMED
ill ACCX>RIl2\NCE wrrn GOVERNMENl' AUDITING S'I'ANIWU13
To the Board of Directors
Salina Airport Authority
Sal ina , Kansas
We have audited the financial state.rænts of Salina AiIport Authority, a
carrq;x:>nent unit of the City of Salina, Salina, Kansas, as of ani for the year
errled December 31, 1995 ani have issued our report thereon dated March 15,
1996.
We corrlucted our audit in acx::ordance with generally accepted audi'tiß:J
starx3ards, the Kansas Municipal Audit Guide, Govennœnt Audi tinq Stan:1ards,
issued by the Cc:Irptroller General of the united States ani the provisions of
Office of Managerænt ani ft1dget circular A-U8, "Audits of State ani LDcal
Governments. " '!hose starx3ards ani œB circular A-U8 require that we plan arrl
perfOD1\ the audit to obtain reasonable assurance about whether the financial
statelænts are free of material misstate.rænt.
'!he managexænt of Salina Airport Authority, a c:cxrponent unit of the City of
Salina, Salina Kansas, is responsible for establishiI'g ani maintaining an
internal control stnlcture. In fulfillin:J this responsibility, estiIrates arrl
judgIœ.nts by managerænt are required to as~s the expected benefits arrl
related costs of internal control stnlcture policies ani procedures. '!he
objectives of an internal control structure are to provide management~ with
reasonable, 1::ut not absolute, assurance that assets are safeguarded against
loss iran unauthorized use or disposition, am that transactions are executed
in acx::ordance with managerænt' 5 authorization arrl recorded properly to permit
the preparation of general p.rrpose financial statelænts in acx::ordancE! with
generally accepted accountiß:J principles. Because of inherent lilnitations in
any internal control stnlcture, errors or irregularities may nevertheùess occur
arrl not be detected. Also, projection of any evaluation of the struc:ture to
future periods is subj ect to the risk that procedures may becc:.iæ inadequate
because of d1.arges in corrlitions or that the effectiveness of the design arrl
operation of policies arrl procedures may deteriorate.
In planni.n:J ani performing our audit of the general p.n:pose financial
statelænts of Salina Airport Authority, for the year errled Decernber 31, 1995,
we obtained an urrlerstarrling of the internal control structure. with respect
to the internal control stnlcture, we obtained an urrlerstarrling of the design
of relevant policies arrl procedures for the purpose of expressiß:J our opinion
on the general purpose financial state.rænts arrl not to provide an opinion on
the internal control structure. Accordingly, we do not express such an
opinion.
MEMBERS OF
DIVISION FOR CPA FIRMS PRIVATE COMPANIES PRACTICE SECTION
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTNHS
KANSAS SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS
( 61)
Our consideration of the inten1al control structure would not necessarily
disclose all Itkltters in the inten1al control structure that might be material
weaknesses urxier standards established by the Arærican Institute of Certified
Public Accounbmts. A material weakness is a condition in which the design or
operation of one or more of the inten1al control structure elements does not
reduce to a relatively lo;,¡ level the risk that errors ani irregularities in
amounts that would be material in relation to the general pw:pose financial
statements being audited may occur ani not be detected within a ti1nely period
by employees in the normal course of performing their assigned functions. We
noted no matters involving the inten1al control structure ani its operation
that we considj=r to be material weaknesses as defined above.
However, wø noted certain matters involving the internal control structure
and its operation that we have reported to the management of salina Airport
Authority, in a separate letter dated March 15, 1996.
'!his report is intended for the infonnation of the 00ard of directors.
However, this :report is a matter of public record and its distribution is not
limited.
~f~
Sal ina. , Kansas
March 15, 1996
(62)
HARRISON & ARNETT
CHARTERED
CERTIFIED PUBLIC ACCOUNTANTS
EUGENE O. HARRISON, C.P.A.
THOMAS G. ARNETT, C.P.A.
719 EAST CRAWFORD. SALINA KANSAS 67401
PHONE: (913) 827,7244
FAX: (913) 827,0048
INDEPENDENl' AUDrIOR' S REroRl' ON a:MPLIANCE BASED ON
AN AUDIT OF FINANCIAL S'I'A'I'lliENl' PERFORMED ill
ACCDRDP.NCE w:rrn GOVERNMENI' AUDITING STANJ).ARœ
To the Board of Directors
Salina Airport Authority
Sal ina , Kansas
We have audited the financial stateroonts of Salina Airport Authority, a
canponerrt: tmit of the city of Salina, Salina, Kansas, as of arrl for the year
errled December 31, 1995 arrl have issued our report thereon dated March 15,
1996.
We con:iucted our audit in aœordance with generally accepted audit:in;J
stan:iaràs, the Kansas Mlmicipal Audit Guide, Government Audi tinct St:an:'lards,
issued by the Co1'!ptroller General of the United States ani the provisions of
Office of Manageroont arrl Budget circular A-U8, "Audits of State arrl IDCal
Govennnents." '!hose stan:iaràs ani œB Circular A-U8 require that we plan ani
perform the audit to obtain reasonable assurance about whether the financial
statements are free of material misstatelænt.
Cclrpliance with laws, regulations, contracts, ani grants applicable to
Salina Airport Authority, Salina, Kansas, is the responsibility of Salina
Airport Authority, Salina, Kansas management. As part of c.òt:ain:in3' reasonable
assurance about whether the financial statements are free of material
misstatement, we perfo:rmed tests of the Authority's c:arpliance with certain
provisions of laws, regulations, contracts, ani grants. However, the: obj ecti ve
of our audit of the financial stat:eIænts was not to provide an opinicn on
overall c::x:rrpliance with such provisions. Accorciin:Jly, we do not express such
an opinion.
'!he results of our tests disclosed no instances of l1Ol'1CCIIPliance that are
required to be reported urrler Goverrnnent Audi tin;J Stanjards.
'!his report is inte.rxied for the infonnation of management arrl thE~ Board of
Directors. '!his restriction is not interrled to limit the distribution of this
repor.: , which is a matter of ¡xIDlic record.
~/~
Sal ina , Kansas
March 15, 1996
MEMBERS OF
DIVISION FOR CPA FIRMS PRIVATE COMPANIES PRACTICE SECTION
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS
KANSAS SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS
(63)
HARRISON & ARNETT
CHARTERED
CERTIFIED PUBLIC ACCOUNTANTS
EUGENE O. HARRISON, C.P.A.
THOMAS G. ARNETT, C.P.A.
719 EAST CRAWFORD. SALINA, KANSAS 67401
PHONE: (913) 827-7244
FAX: (913) 827.0048
INDEPENDENT AIJDrroR I S REroRI' ON sæEOOIE OF
FEDERAL FINANCIAL ASSISTANCE
To the Board of Directors
salina Allport Authority
sal ina , Kansas
We have auiited the financial statements of Salina AiJ:port Authority, a
CCITIpOnent tmit of the City of Salina, salina, Kansas, for the year en:ied
December 31, 1'995 am have issued our report thereon dated March 15, 1996.
'Ihese financial stateIrents are the responsibility of Salina AiJ:port Authority,
Salina, Kansas managezœnt. our responsibility is to express an opinion on
these financial stateIrents based on our audit.
We corrlucted our audit in acx::ordance with generally accepted auditin;J
stamards, the Kansas MLmiciœl Audit Guide, Government Auditim ~,
issued by the O:I11ptroller General of the United States am the provisions of
Office of Managezœnt am B..1dget ci.ra1lar A-U8, "Audits of State am Local
GovenlIDE!I'1ts. " 'll1ose stamards am CMB ci.ra1lar A-U8 require that we plan am
perfonn the audit to obtain reasonable assurance about whether the financial
staterœnts are~ free of material misstat:errent. An audit includes exanri.niD:;, on
a test basis, evidence supportin;J the anounts am disclosures in the financial
staterœnts. }Jl audit also includes assessin;J the accountinJ principles used
am significant estimates made by manageIœIIt, as well as evaluating the overall
financial stat:eœnt presentation. We believe that our audit provides a
reasonable basis for our opinion.
our audit was made for the pn:pose of fonnin;J an opinion on the financial
staterœnts of Salina Allport Authority, salina, Kansas, taken as a whole. 'll1e
accc:lIr'paI1YinJ schedule of federal financial assistance is presented for p.n:poses
of additional analysis ani is not a required part of the financial state1œnts.
'll1e infonnation in that schedule has been subjected to the auditinJ procedureS
applied in thE~ audit of the financial state1œnts am, in our opinion, is fairly
presented in all material respects in relation to the financial state1œnts
taken as a whole.
~J/~
sal ina , Kansas
March 15, 1996
MEMBERS OF
DIVISION FOR CPA FIRMS PRIVATE COMPANIES PRACTICE SECTION
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS
KANSAS SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS
(64)
HARRISON & ARNETT
CHARTERED
CERTIFIED PUBLIC ACCOUNTANTS
EUGENE O. HARRISON, C.P.A.
THOMAS G. ARNETT, C.P.A.
719 EAST CRAWFORD. SALINA, KANSAS 67401
PHONE: (913) 827.7244
FAX: (913) 827.0048
INDEPENDENT AIJDI'IOR' S REroRI' ON 'mE INI'ERNAL CX>NI'ROL
STRUCIURE USED ill AI:MINISTERING FEDERAL FINANCIAL
ASSISTANCE pR:X;RAMS
To the Board of Directors
Salina Airport Authority
Sal ina , KansaS
We have audited the financial stateIænts of Salina Airport Authority, a
component unit of the City of Salina, Salina, Kansas, for the year ended
December 31, 1995 and have issued our report thereon dated March 15, 1996.
We have also audited the c:x:JItPliance of the Salina Airport Authority \tJith the
requirements applicable to major federal financial assistance prograrrs and have
issued our report thereon dated March 15, 1996.
We conducted our audit in accordance with generally accepted auditing
standards, the Kansas Municipal Audit Guide, Governrnent Audi tim Standards,
issued by the Comptroller General of the United states, and Office of
Management and Budget(CMB)Circular A-128, "Audits of State and ID::al
Governments. " '!hose standards and CMB circular A-128 require that WE~ plan and
perfonn the audit to obtain reasonable assurance about whether the financial
statements are free of material misstateIænt and about whether the Sëùina
Airport Authority complied with laws and regulations, noncompliance "l¡iÌth VJhich
would be material to a major federal financial assistance program.
In planning and perfoDning our audit for the year en:ied December 31, 1995,
we considered the Authority's internal control structure in order to determine
our auditing procedures for the purpose of expressing our opinion on the
Authority's financial statements and on its c:x:JItPliance with requi.rem=nts
applicable to maj or programs not to provide assurance on the internal control
structure. 'Ibis report addresseS our consideration of internal control
structure policies and procedures relevant to compliance with requil:1ements
applicable to federal financial assistance programs. We have addressed
internal control policies and procedures relevant to our audit of the financial
statements in a separate report dated March 15, 1996.
The management of Salina Airport Authority, is responsible for establishing
and maintaining an internal control structure. In fulfilling this
responsibility, estimates and judgments by management are required to assess
the expected benefits and related costs of internal control structuI:e policies
and procedures. The obj ecti ves of an internal control structure are~ to provide
management with reasonable, but not absolute, assurance that assets are
safeguarded against loss from unauthorized use or disposition, that
transactions are executed in accordance with management's authorizat:ion and
recorded properly to permit the preparation of financial statements in
accordance with generally accepted accoill1ting principles, and that federal
MEMBERS OF
DIVISION FOR CPA FIRMS PRIVATE COMPANIES PRACTICE SECTION
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS
KANSAS SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS
(65)
financial assistance programs are managed in canpliance with applicable laws
arrl regulations. Because of inherent l:i1nitations in any internal control
structure, errors, irregularities, or instances of noncompliance may
nevertheless occur arrl not be detected. Also, projection of any evaluation of
the structure 1:0 future periods is subj ect to the risk that procedures may
becane inadequate because of changes in corxlitions or that the effectiveness of
the design arrl operation of policies arrl procedures may deteriorate.
For the pw:p:>se of this report, we have classified the significant internal
control structure policies arrl procedures used in administerim federal
financial assistance programs in the followim categories:
Accountim COntrols
1. Receipts
2. Purchase/disbursement
3 . Claims for re:i.rnburserænt
Administra:ti ve COntrols
1 . General Require1ænts
R:>litical activity
Davis-Bacon Act
civil Rights
Fe:ieral financial reports
DrLIg-Free WOrkplace Act
2. Eligibility
For all the internal control structure categories listed above, we obtained
an urrlerstarrlirq of the design of relevant policies ani procedures arrl
detennined whether they have been placed in operation, ani we assessed control
risk.
Dlrim the year errled December 31, 1995, Salina Airport Authority had no
major federal financial assistance programs am experrled 100 percent of its
total federal financial assistance urrler the followim major federal financial
assistance prcgram: Federal Aviation Administration, Airport Develcpœnt
Program .
We perfonned tests of controls, as required by CMB circular A-l28, to
evaluate the E!ffecti veness of the design arrl operation of internal control
structure policies arrl procedures that we have considered relevant to
preventim or detectim material noncompliance with specific requirerænts,
general requiI:errents, am requ.i.rerænts gov~ clailns for advances am
rei.mburserrents am annmts clairood or used for mat:chi..rg that are applicable to
the aforeræntioned major program. our procedures were less in sc::q>e than would
be necessary t:o rerrler an opinion on these internal control structure policies
am procedures. Accordingly, we do not express such an opinion.
(66)
we noted certain matters involvirg the internal control structure ani its
operation that we consider to be reportable corrli tions urrler starrlards
established by the American Institute of certified Public AccoUntants.
Reportable corrlitions involve matters caning to our attention relating to
significant deficiencies in the design or operation of the internal control
structure that, in our judgIœnt, could adversely affect the Authority's ability
to administer federal financial assistance programs in accordance with
applicable laws ani regulations.
D.1e to small numbers of staff persons in the administrative office, the
Authority is not able to provide the segregation of duties carm:>n to larger
organizations.
A material weaknesS is a reportable corrli tion in which the design or
operation of one or more of the internal control structure elements does not
reduce to a relatively low level the risk that nonc:x::atpliance with la~/S ani
regulations that would be material to a federal financial assistance program
may occur am not be detected within a tiIæly period by eI11?loyees in the normal
cx;¡urse of perfonning their assigned functions .
our consideration of the internal cx>ntrol structure would not necessarily
disclose all matters in the internal cx>ntrol structure that might be reportable
oorrlitions am, accorcii.rqly, would not necessarily disclose all reportable
cx>rrlitions that are also considered to be material weaknesses as defined
above. However, we believe the reportable cx>rrlition described above is not a
material weaknesS.
'!his report is intended for the information of management ani th ~ Board of
Directors. '!his restriction is not intended to limit the distribution of this
report, which is a matter of public record.
~f~.
sal ina , Kansas
March 15, 1996
(67)
HARRISON & ARNETT
CHARTERED
CERTIFIED PUBLIC ACCOUNTANTS
719 EAST CRAWFORD. SALINA, KANSAS 67401
PHONE: (913) 827.7244
FAX: (913) 827.0048
EUGENE O. HARRISON, C.P.A.
THOMAS G. ARNETT, C.P.A.
INDEPENDENI' AUDI'IOR' S REFORI' ON a:MPLIANCE
WTIH 'THE GENERAL ~ APPLI CABIE 'ill
FEDERAL FINANCIAL ASSISTANCE PROGRAMS
To the Board of Directors
Salina Airport Authority
Sal ina , Kansas
We have audited the financial statements of Salina Airport Authority, a
component unit of the city of Salina, Salina, Kansas, as of am for the year
ended December 31, 1995 am have issued our report thereon dated March 15,
1996.
We have applied procedures to test Salina Airport Authority, Salina,
Kansas, CCJITPliance with the following require.mants applicable to each of its
federal financial assistance programs, the nonmajor program which is identified
in the schedul4~ of federal financial assistance, for the year ended December
31, 1995: political activity, Davis-Bacon Act, civil rights, cash management,
federal financial reports, allowable costs, Dl:Ug-free Workplace Act,
administrative requirements.
our procedures were l:i1nited to the applicable procedures described in the
Office of Management am &1dget' s "Compliance SUWlement for single Audits of
state am IDeal Governments". our procedures were substantially less in scope
than an audit, the objective of which is the expression of an opinion on Salina
Airport Authority, Sal ina , Kansas , CCJITPliance with the requirements listed in
the precerli.rg paragraph. Accordingly, we do not express such an opinion.
With respect to the items tested, the results of those procedures disclosed
no ll'aterial instances of noncompliance with the require.mants listed in the
second paragraph of this report. With respect to items not tested, nothing
came to our attention that caused us to believe that Salina Airport Authority,
Salina, Kansas, had not complied, in all ll'aterial respects, with those
requirements .
'!his report is intended for the information of management am the Board of
Directors. 'ItLis restriction is not intended to limit the distribution of this
report, which is a ll'atter of public record.
~_/~
Sal ina , Kansas
March 15, 1996
MEMBERS OF
DIVISION FOR CPA FIRMS PRIVATE COMPANIES PRACTICE SECTION
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS
KANSAS SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS
(68)
HARRISON & ARNETT
CHARTERED
CERTIFIED PUBLIC ACCOUNTANTS
EUGENE O. HARRISON, C.P.A.
THOMAS G. ARNETT, C.P.A.
719 EAST CRAWFORD. SALINA, KANSAS 67401
PHONE: (913) 827.7244
FAX: (913) 827.0048
INDEPENDENT AUDI'lOR' S REroRl' ON CXMPI.J:ANCE WI'IH
SPECIFIC ~ APPLICABIE 'ill MAJOR FEDERAL
FlliANCIAL ASSISTANCE I'RCGRAM TRANSAcrIONS
To the Board of Directors
Salina Airport Authority
Sal ina , KansaS
We have audited the financial staterænts of Salina Airport Authority, a
component unit of the City of Salina, Salina, KansaS, as of arrl for the year
errled December 31, 1995 arrl have issued our report thereon dated Mardl 15,
1996.
We have also audited Salina Airport Authority's compliance with the
requirements gove:rning types of savices allowed or unallowed; eligibility;
matching, level of effort, or eannarking; reporting; claims for advances and
reimbursements; and amounts cla:i1ned or used for matching that are applicable to
each of its major federal financial assistance programs, which are id4=ntified
in the acx:x:xnpanying Schedule of Federal Financial Assistance, for the year
errled December 31, 1995. '!he management of Salina Airport Authority, is
responsible for the Salina Airport Authority's compliance with those
requirements. OUr responsibility is to express an opinion on compliance with
those requirements based on our audit.
We corrlucted our audit of compliance with those require1œnts in accordance
with generally aœepted auditing starrlards, KansaS Municipal Audit Guide,
Government Audi tim Standards, issued by the Comptroller General of the united
states; arrl Office of Management arrl Budget (CMB) circular A-l2B, "Audits of
State arrl IDeal Governments." '!hose starrlards arrl CMB circular A-l2S require
that we plan arrl perfonn the audit to obtain reasonable assurance abClut whether
material noncompliance with the requirements referred to above occurred. An
audit includes examining, on a test basis, evidence about the Salina Airport
Authority's compliance with those requirements. We believe that our audit
provides a reasonable basis for our opinion.
In our opinion, Salina Airport Authority, complied, in all material
respects , with the requirements gove:rning types of savices allowed or
unallowed; eligibility; matching, level of effort, or eannark1ng; reporting;
claims for advances and reimbursements; arrl amounts cla:i1ned or used for
matching that are applicable to each of its major federal financial assistance
programs for the year errled December 31, 1995.
'!his report is intended for the infonnation of management arrl the Board of
Directors. '!his restriction is not intended to limit the distributi<:m of this
report, which is a matter of public record.
~/~
Sal ina , KansaS
March 15, 1996
MEMBERS OF
DIVISION FOR CPA FIRMS PRIVATE COMPANIES PRACTICE SECTION
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS
KANSAS SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS
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