Audit Report - 2000COMPREHENSIVE ANNUAL FINANCIAL REPORT
of the
SALINA AIRPORT AUTHORITY
A Component Unit of the
City of Salina, Kansas
For the Fiscal Year Ended December 31, 2000
Prepared by the Management
of the
Salina Airport Authority
Salina Airport Authority
����1&\ Salina Municipal Airport / Industrial Center
SALINA AIRPORT AUTHORITY
TABLE OF CONTENTS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
For the Fiscal Year Ended December 31, 2000
INTRODUCTORY SECTION Page
Letterof Transmittal ......................................................................... ..............................1
PrincipalOfficers ............................................................................ .............................12
AuthorityStaff Members ................................................................. .............................13
OrganizationalChart ...................................................................... .............................14
Certificate of Achievement ............................................................. .............................15
Salina Municipal Airport Aerial View .............................................. .............................16
FINANCIAL SECTION
Independent Auditor's Report ........................................................ .............................17
Financial Statements:
Comparative Balance Sheet ............................................. ............................... 20 -21
Comparative Statements of Revenues, Expenses and
Changes in Retained Earnings ............................................ .............................22
Comparative Statements of Cash Flows (Direct Method ) ........................... 23 -24
Notes to Financial Statements, December 31, 2000 and 1999 .............................25
Supplemental Information
Schedule of Operations and Changes in Retained Earnings .......................... 40 -41
CapitalExpenditures ................................................................. .............................42
General Obligation Bonds — Series 1993- A .............................. .............................43
General Obligation Bonds — Series 1993- B .............................. .............................44
General Obligation Bonds — Series 1998- A .............................. .............................45
General Obligation Refunding Bonds — Series 1999 -B ............ .............................46
i
Supplemental Information (continued)
Leasehold Revenue Bonds — Series 1991 ............................... .............................47
KDOCH Contract Payable ........................................................ .............................48
Insurancein Force .................................................................... .............................49
STATISTICAL SECTION
OperatingRevenue History .......................................................... .............................51
OperatingExpense History ........................................................... .............................52
Federal Financial Assistance History ............................................ .............................53
Capital Expenditure History .......................................................... .............................54
RevenueBond Coverage ............................................................. .............................55
PrincipalCustomers ....................................................................... .............................56
Local Government Mill Levy Rates, Direct & Overlapping ............ .............................57
MillLevy Revenue ........................................................................ .............................58
Air Traffic, Fuel Flowage, Enplanement Trends ............................ .............................59
MajorEmployers ........................................................................... .............................60
Saline County Population, Demographic and Labor Statistics ...... .............................61
Saline County Employment Data .................................................. .............................62
OTHER INDEPENDENT AUDITOR'S REPORTS
Independent Auditor's Report on Compliance on Internal Control .............................63
ii
AAAA—L, Salina Airport Authority
v
,XAt%\ Salina Municipal Airport / Industrial Center
Chairman Vice - Chairman Secretary Treasurer Assistant Secretary / Treasurer
PAT BOLEN JOHN K. VANIER, ii DONALD E. MORRIS ROBERT H. MILLER R. MICHAEL BEATTY
Executive Director: TIMOTHY F. ROGERS, A.A.E. Mgr. of Administration & Finance: MICHELLE R. SWANSON
Board Attorney: GREG A. BENGTSON
June 13, 2001
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 (CAFR) of the Salina Airport Authority (the "Authority ")
for the fiscal year ended December 31, 2000 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 2000 CAFR. Responsibility for both the accuracy of the data presented and
the completeness and fairness of the presentation, including all disclosures, rests with the Executive
Director of the Authority. To the best of my knowledge and belief, the data as presented is accurate
in all material aspects, 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 2000 Comprehensive Annual 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
1999, and an aerial photo of the Salina Municipal Airport and Airport Industrial
Center.
Financial Section - includes the independent auditor's report, the Authority's 2000
financial statements and supplemental schedules.
Statistical Section - includes selected financial and demographic information which
highlights economic and demographic trends.
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 federal financial assistance, reporting on the internal control structure
used in administering federal financial assistance programs, compliance with
3237 ARNOLD • SALINA, KS 67401- 8190.Off: (785) 827 -3914 • Fax: (785) 827 -2221 www.salair.org
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general requirements applicable to federal financial assistance programs, 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 (KEA 27 -315 et seq.)
Pursuant to GASB Statement No. 14, the Authority is a component unit of the City of Salina. 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 2,700 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 twelve employees manage and operate the Salina Municipal
Airport and the Salina Airport Industrial Center.
The Salina Municipal Airport is the only commercial service airport serving Salina /Saline County and
the 22- county area which comprises North Central Kansas. The Airport also services the corporate,
business, private aviation and flight training needs of industry, business and individuals in the area.
The Airport is also used by the Kansas State University - Salina Aeronautical Technology
Department. The campus of K -State Salina is located adjacent to the airport. The K -State Salina
Department of Aeronautical Technology offers degrees in professional flight training, airframe and
power plant maintenance, and avionics technology.
The Salina Airport Industrial Center is home for 78 businesses and organizations. Fifty -one of the
businesses and organizations are tenants of the Authority. One of the primary functions of the
Authority is to facilitate the continued growth of jobs and payroll at the Salina 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 of construction, manufacturing, transportation,
retail trade, and services confirms Salina's position as one of Kansas' strongest regional economic
centers.
According to a report published by the K -State Research and Extension, Department of Agricultural
Economics released April 2001, Saline County ranked second only to Johnson County out of the
Av\ Salina Airport Authority
IAWAA\ Salina Municipal Airport/ Industrial Center
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105 counties in "strength index" for 1999 -2000. The index is a measure of economic prosperity in
Kansas counties, and is made up of three components; wealth index, employment index and
personal income index. The three components were given equal weight. The Strength Index for
Kansas is 3.00. The 105 county average is 2.51 and Saline county's index is 3.19. In addition,
Saline County ranked eleventh in the employment index which measures the proportion of the local
population actively participating in the labor force. The source for the strength index data was
provided by the U.S. Department of Commerce, Bureau of the Census, Kansas Department of
Revenue, Kansas Department of Human Resources, and K -State Research and Extension.
Economic Condition of the Airport and Airport Industrial Center
As of December 31, 2000, seventy -eight businesses and organizations at the Airport and Airport
Industrial Center employed an estimated 4,600 employees. Total payroll for 2000 was an estimated
$121 million. Total business volume during this time surmounted $566 million.
In 2000 the Airport and Airport Industrial Center attracted an estimated 75,619 visitors whose
average stay was three days
Future Economic Outlook
The future economic outlook for both Salina and the Authority continues to look favorable.
Continued growth in service, retail and manufacturing sectors is expected. The Salina Area
Chamber of Commerce forecasts that approximately 700 new jobs per year will be added to the
economy with emphasis on growth in primary jobs during the 1998 -2003 time period. Airport
Industrial Center businesses such as Raytheon Aircraft Company, Tony's Pizza, Inc., Ovation
Cabinetry, Vidricksen Distributing, the Salina Area Technical School (USD #3015), and Aerospace
Systems and Technologies, Inc., continue to work on expansion plans that will result in additional
jobs, payroll, and increased revenue opportunities for the Authority.
INITIATIVES AND DEVELOPMENT
Salina Municipal Airport
Without a doubt, 2000 was the year of the air service roller coaster ride. After ending
1999 with the highest number of passenger enplanements since Salina was serviced with
B -737's in 1981, the Authority was dismayed early in the year when Great Lakes Aviation
filed their notice to terminate service at Salina. High operating costs, not lack of
customers was the expressed culprit. With a great deal of work, the assistance of
Congressman Jerry Moran, and the approval of the Federal DOT, Great Lakes paired
Salina with Hays to retain our westbound service and increase our flights to three per day.
Throughout the year, customer service and reliability became a large! concern of travel
agents and area passengers. At the end of the first quarter, enplanements were down 7%
from 1999. By the end of the second quarter, enplanements had dropped to 18% from the
prior year. On August 18, 2000, FAA Administrator Jane Garvey vlisited Salina along
with Congressman Jerry Moran to discuss aviation issues with local officials. Following
the successful visit, the Salina Journal prints an erroneous headline stating, "Salina could
lose all air services ". Comments from airline officials regarding the economics of providing
air service prompted the headline that required significant damage control by the
Authority. By the end of the 3rd quarter enplanements were down 28% from 1999.
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Sharing seats with Hays lowered the number of available discounted tickets available for
Salina passengers. In addition, flight cancellations over the summer months due to the
"nation wide" crew shortage, made travelers upset and questioning the commuter carrier's
reliability. The number of travelers to Kansas City declined because of the sharp drop in
the number of connecting flights out of KCI. At the end of 2000, passenger enplanements
were down 25% from the prior year. Towards the end of the year came positive news
when Air Midwest announced that it had secured a codeshare agreement with Midwest
Express that doubled the number of joint fare connecting flights at Kansas City
International Airport.
Throughout the year, Authority staff worked very diligently in keeping travel agents abreast
of changes by making travel agency visits and by utilizing our group -wide faxing
capabilities to disseminate information. Over the summer, Authority staff made the tour of
North Central Kansas travel agents and updated the 1999 ticket lift in conjunction with our
aviation - consulting firm, SH &E. In October, the Authority presented the Proposal for
Enhanced Air Service by United Airlines with a Regional Code Share to United Airlines in
Chicago.
• During 2000, the Authority worked an agreement with Sprint for the installation of new
modern payphones equipped with card readers for pre -paid phone and credit cards and
data port connections for the laptop /internet users. Sprint installed two desktop phones
and five wall mounted phones at no charge.
• During the spring, the Authority per new FAA standards, repainted all airport markings on
runways, taxiways and aprons. The new painting significantly increased the visibility of
the markings. The Authority completed the project prior to the August 31, 2000 deadline.
• On June 6, 2000, the Authority successfully completed the full -scale emergency exercise
that is required under FAR Part 139 every 3 years.
• The Authority was fortunate to host two significant military training exercises during 2000.
The Navy utilized the airport for a crew from Meridian, MS who brought in ten T45c aircraft
for fighter pilot training. They purchased over 70,000 gallons of fuel during the exercise
that was held in October. At the close of the Navy exercise a unit from Whiteman AFB
conducted a two -week exercise involving over 13 aircraft including A -10's, C- 130's, and
search and rescue helicopters.
• The Airport's two aviation fuel outlets, Flower Aviation and Moore's Midway Aviation (now
known as Midway Aviation) delivered a record 4,472,164 gallons of fuel to a wide variety of
private, air carrier, corporate, government, and military aircraft. As a result, the Authority
recorded a 12% increase in fuel flowage fees, which hit a record $263,264 for the year.
Salina Airport Industrial Center
The Authority proved to be very successful during 2000 in our efforts to sell and market
available property. The following summarizes the 2000 real estate transactions:
3 -31 -00 The Authority closes on the single largest real estate transaction in its
��nmSalina Airport Authority
, Salina Municipal Airport / Industrial Center
history by selling a 53,300 sq. ft. manufacturing facility and 26.5 acres of
land to ElDorado National of Kansas, Inc. Proceeds from the sale totaled
$1,405,992. ElDorado National is constructing a multi - million dollar bus
manufacturing plant.
5 -30 -00 The Authority closed on the sale of 3.9 acres of land in Schilling
Subdivision No. 5 to Power Ad Company. Proceeds equaled $72,284.
Power Ad Company acquired the property for possible future expansion of
their sign operation.
6 -30 -00 The Authority closed on the sale of 2.5 acres of property in Schilling
Subdivision No. 8 to the Norman Vidricksen Trust. Proceeds from the sale
totaled $46,065. The site will be utilized for the construction of a new
Budweiser distribution facility.
8 -30 -00 ElDorado National purchased from the Authority a 7.4 acre tract of ground
adjacent to the tracts purchased earlier in the year. ElDorado plans on
utilizing this tract for chassis parking. Proceeds from the sale equaled
$110,268.
• Waterwell Rd. /1 -70 Interchange Project
During the first of the year, the Authority worked in partnership with the City and the
Chamber to put together a presentation for the KDOT Economic Development Review
Panel for consideration of the Waterwell Rd. /1 -70 Interchange Project. On February 29,
2000 the review panel heard the presentation and in August the state approved the project
as part of KDOT's System Enhancement Program. The project is slated to begin in the
spring of 2000. The interchange will provide another access point into the Airport
Industrial Center and relieve congestion from Schilling Road.
• West Schilling Road Project
During the summer, the Authority again partnered with the City to prepare an Economic
Development Grant application for the reconstruction of portions of Schilling Road and
Centennial Rd. KDOT has approved the project and it is expected this project will get
underway during the spring of 2003. This project will complete the reconstruction of all of
the secondary and arterial streets within the Airport Industrial Center.
• Building & Land Improvements
During 2000, the Authority made over $430,000 in building and land improvements. This
investment included improvements and modifications to industrial buildings, airfield
improvements, building demolition, and site development.
Financial Affairs
• Accounting System Conversion
During 2000, the Authority undertook the task of converting its accounting system from
SBT to QuickBooks Pro. This task was indeed a challenge that has already proved its
AAL
Salina Airport Authority
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worth. We have adapted this package to meet our financial reporting requirements and
have integrated our accounting with our property management system. QuickBooks
works seamlessly with our office software applications including Microsoft Word, Access,
Excel and PowerPoint.
• Bond Defeasment
With the sale of real estate to ElDorado National, the Authority was able to defease the
1999 -A General Obligation Bonds and retire $725,000 of principal debt.
• Web Site Development
During 2000 the Authority staff re- developed its web site to feature news releases, airline
information, area travel agent contacts, airport industrial center information, job postings
and other airport information. This site was developed and will be maintained in- house.
• Economic Impact Study
In October, the Authority completed an Economic Impact Study involving the 78
businesses and organizations located within the Airport/Airport Industrial Center. This
study provides the Authority with very valuable data including types of businesses, number
of jobs, total payroll, business volume, capital expenditures, and annual number of visitors.
Having this information is critical for the continued development of the Airport/Airport
Industrial Center.
Environmental
The Authority continues to work with the U.S. Army Corps of Engineers, the U.S.
Environmental Protection Agency and the Kansas Department of Health and Environment to
investigate the environmental status of the Salina Municipal Airport and the Salina Airport
Industrial Center. Pursuant to the Defense Environmental Restoration Program /Formerly
Used Defense Sites, the U.S. Army Corps of Engineers continued work on Site Investigation
and Remedial Investigation reports. The reports address previous U.S. Department of
Defense use of Airport and Airport Industrial Center land during the operations of Schilling
Air Force Base.
During the remainder of calendar year 2001, the Corps of Engineers intends to begin
conducting further investigations and preparing an Engineering Evaluation and Cost
Analysis for a possible interim action. This will be followed by a groundwater study and
feasibility study. Based upon these statistics, the Corp of Engineers will prepare a decision
document and take the appropriate remedial actions.
Administration
• During 2000, the Salina Airport Authority prepared for an administrative staff change. Don
Kneubuhl, the Authority's Director of Operations, Maintenance & ARFF, announced in
February, 2000, that he was ready to retire. The Authority knew the challenge they faced in
finding a suitable replacement for Don, who had served the Authority and community for 35
years. Following Don's announcement, the Authority immediately began a national
Salina Airport Authority
,1A Salina Municipal Airport/ Industrial Center
W-Z
employment search to seek a qualified replacement. At the same time, the Authority
negotiated an employment contract with Don, which allows him, following his retirement and
a short separation, to return to the Authority as a part -time Manager of Special Projects. The
contract was finalized in December of 2000 and allows the Authority the opportunity to utilize
Don's expertise and knowledge for up to eight years on a part-time basis.
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 provide reasonable, but not absolute, assurance that these objectives are
met. The concept of reasonable assurance recognizes that: (1) the cost of a control should not
exceed the benefits likely to be derived; and (2) the valuation of costs and benefits requires
estimates and judgments by management.
An annual budget is prepared in accordance with the Authority's By -laws. 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 Authority's rental revenues decreased by 6.73% over the previous year. The decrease can be
attributed to the sale of a 53,300 sq. ft. manufacturing facility that previously generated rental
income to the Authority. FBO revenue increased 12.34% over the prior year and landing fees over
13.82°/x. With the sale of assets as discussed previously, the Authority realized a net gain on the
sale of assets in the amount of $222,664. This allowed the Authority to realize an 11.60% increase
in total operating revenue.
A summary of operating revenues follows:
Increase Percent
(Decrease) (Decrease)
Operating Revenues 1999 2000 From 1999 Increase
Rental revenues
$1,202,149
$1,121,194
$(80,995)
-6.73%
Fixed base operator
234,338
263,264
28,926
+12.34%
Landing fees
10,660
12,133
1,473
+13.82%
Gain (loss) on sale of assets
0
222,664
-
+100.00%
Other operating revenues
26,965
25,992
(973)
- 3.6%
Total
$1.474.112
1.645.247
$171.135
±-11.600
Salina Airport Authority
, Salina Municipal Airport / Industrial Center
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Expenses
Total operating expenses before depreciation increased 1.99 %. Office and administrative expenses
increased by 1.82% due to increases in airport promotion, computer /network support, dues and
subscriptions, employees retirement, payroll taxes, medical insurance, property /liability insurance,
legal & accounting, office salaries, office supplies, postage, and travel and meetings. Maintenance
expenses increased by 2.29% due to increases in building maintenance, equipment, gas, oil and
repairs and maintenance salaries.
A summary of operating expenses follows:
Increase Percent
(Decrease) (Decrease)
Operating Expenses 1999 2000 From 1999 Increase
Office and Administration
$726,651
$ 739,911
$13,260
+ 1.82%
Maintenance
377,457
386,115
8,658
+ 2.29%
Total
$1,104,1Qa
$1.126.026
21918
+ 1.99%
DEBT ADMINISTRATION
The outstanding long -term debt of the Authority was $5,081,551 at December 31, 2000. This debt
consists of general obligation bonds, leasehold revenue bonds and a HUD Community
Development Block Grant loans of the Authority. Maturities range from 2003 through 2010. Both
principal and interest are payable from proceeds of a direct financing lease and the general
revenues of the Authority. Details are shown in Note III (E): Long -Term Liabilities.
CASH MANAGEMENT
All cash temporarily idle during 2000 was invested by the Executive Director of the Authority in
short -term investments to attain the highest possible return consistent with the Authority's liquidity
needs. All investments are in compliance with K.S.A. 12 -1675 which controls the investment of
public funds by Kansas governmental units. All funds are deposited daily and all accounts are
interest bearing.
RISK MANAGEMENT
The Authority is exposed to risks of loss associated with the operation of a public use airport and the
operation of an airport industrial center. To handle the associated risks of loss, the Authority uses
available tort liability legislation and purchases the appropriate types of insurance coverage. It is the
policy of the Authority to eliminate or transfer risk of loss where possible.
The Authority is covered by the Kansas Tort Claims Act. (K.S.A. 75 -6101, et seq.). The act provides
that a governmental entity shall be liable for damages caused by the negligent or wrongful act or
omission of any of its employees while acting within the scope of their employment under
circumstance where the governmental entity, if a private person, would be liable under the laws of
Kansas. At the same time, the act (1) provides for 22 categories of exemptions from liability for a
IAL
Salina Airport Authority
IAWAA\ Salina Municipal Airport/ Industrial Center
governmental entity or an employee acting within the scope of the employee's employment and (2)
limits liability for any other claims within the scope of the act to $500,000 for any number of claims
arising out of a single occurrence or accident.
The Authority carries $500,000 of comprehensive general liability insurance which matches the limit
established by the Kansas Tort Claims Act. During 2000 the Authority carried $8,643,443 of
insurance on airport commercial properties.
The Authority's commercial property insurance included $1,378,458 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, 2000 is included in
this report.
In addition, the Authority uses various risk management techniques. All contracts and leases are
reviewed by the Authority's legal counsel. All contractors and subcontractors are required to submit
evidence of insurance coverage naming the Salina Airport Authority and the City of Salina as named
additional insured parties.
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 FK Arnett, Chartered.
The independent audit is in accordance with the Kansas Minimum Audit Guide, the Government
Auditing Standards issued by the Comptroller General of the United States.
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
comprehensive annual financial report (CAFR) for the fiscal year ended December 31, 1999. This
was the eighth consecutive year that the Salina Airport Authority has achieved this prestigious
award. In order to be awarded a Certificate of Achievement, a government must publish an easily
readable and efficiently organized comprehensive annual financial report. This report must satisfy
both generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe our current
comprehensive annual financial report continues to meet the Certificate of Achievement Program 's
requirements, and we are submitting it to GFOA to determine its eligibility for another certificate.
MILL LEVY
As provided for in the Authority's Enabling Statute (KSA 27 -315 et seq.), the Authority is able to
use a property tax mill levy to fund matching funds for federal grants or general obligation bond
debt service. During 2000, with the consent of the Salina City Commission, the Authority adopted
a 2.426 mill levy in order to provide matching funds for Federal Aviation Administration Airport
Improvement Program grant funds and to provide debt service funds for the Authority's Series
1998A general obligation internal improvement bonds.
Salina Airport Authority
"AAA' Salina Municipal Airport / Industrial Center
The .340 mills for Federal Aviation Administration Airport Improvement Program matching funds
will provide the Authority an estimated $96,947 in calendar year 2001. The 2.086 mills for debt
service related to the Series 98A general obligation internal improvement will provide the
Authority an estimated $595,423 in calendar year 2001.
ACKNOWLEDGEMENTS
The support of the Authority's Board of Directors has been instrumental in the preparation of this
report. The Board has been actively involved in the preparation and review of this report and is
committed to responsible and progressive financial reporting.
Also acknowledged is the assistance of the Authority's auditor, Harrison & Arnett, Chartered,
Certified Public Accountants, Saline County Clerk's Office, Gerald Cook, President of the Salina
Area Chamber of Commerce, Rod Franz, Director of Finance for the City of Salina, the University of
Kansas Institute for Public Policy and Business Research and the Kansas Department of Human
Resources Labor Market Information Services, in the preparation of this report.
Respectfully submitted,
SALIN A O T AUTHORITY
Timothy F. Rogers, A.A.E.
Executive Director
Salina Airport Authority
cc: The City of Salina Board of Commissioners
elli Swanson -
Manager of Administration and Finance
Salina Airport Authority
Salina Airport Authority
Salina Municipal Airport / Industrial Center
INDIE
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11
SALINA AIRPORT AUTHORITY
BOARD OF DIRECTORS
R. Michael Beatty Chairman
Pat Bolen Vice - Chairman
John K. Vanier, II Secretary
Donald E. Morris Treasurer
James C. Maes Asst. Secretary/TrEiasurer
AUTHORITY'S COUNSEL
Greg A. 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
12
SALINA AIRPORT AUTHORITY
M1,61 ;1:Ta'�cTi�►TiTi
Timothy F. Rogers, A.A.E. Executive Director
Donald C. Kneubuhl Operations Director
Michelle R. Swanson Manager of Administration & Finance
Cathy Lentz Administrative Assistant
OPERATIONS, MAINTENANCE, AIRCRAFT RESCUE & FIRE FIGHTING STAFF
Loren Carleton
Operations, Maintenance & ARFF
Kim Colby
Operations, Maintenance & ARFF
Gary Hansen
Operations, Maintenance & ARFF
Dale Mattison
Operations, Maintenance & ARFF
David Nease
Operations, Maintenance & ARFF
Rob Pejsha
Operations, Maintenance & ARFF
Jason Pinnick
Operations, Maintenance & ARFF
TERMINAL BUILDING CUSTODIAL STAFF
Vachel Keaton Custodian
Francis Vestal Custodian
13
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Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
Salina Airport Authority,
Kansas
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
December 31, 1999
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.
OfpjC
OF
F9
ti UNMO STA
� AND �
CANADA
CORPORATION s resident
S EILL a0`y
cHic�6a ���
Executive Director
is
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6.
G
HARRISON & ARNETT
CHARTERED
CERTIFIED PUBLIC ACCOUNTANTS
EUGENE O. HARRISON, C.P.A. 717 ROACH STREET o SALINA, KANSAS 67401 PHONE: (785) 827 -7244
THOMAS G. ARNETT, C.P.A. FAX: (785) 827 -0048
INDEPENDENT AUDITOR'S REPORT
To the Board of Directors
Salina Airport Authority
Salina, Kansas
We have audited the accompanying financial statements of Salina Airport Authority, a component unit of the City of
Salina, Kansas, as of and for the years ended December 31, 2000 and 1999, as listed in the table of contents. These
financial statements are the responsibility of Salina Airport Authority management. Our responsibility is to express an
opinion on these financial statements based on our audit.
We conducted our audit in accordance with generally accepted auditing standards and the Kansas Municipal Audit Guide,
and Government Auditing Standards, issued by the Comptroller General of the United States. Those standards require
that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of
material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in
the financial statements. An audit also includes assessing the accounting principles used and significant estimates made
by management, as well as evaluating the overall financial statement presentation. We believe that our 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
Salina Airport Authority as of December 31, 2000 and 1999, and the results of its operations and the cash flows of its
proprietary fund types for the years then ended in conformity with generally accepted accountin;; principles.
In accordance with Government Auditing Standards, we have also issued our report dated May 15, 2001, on our
consideration of Salina Airport Authority's internal control over financial reporting and our tests of its compliance with
certain provisions of laws, regulations, contracts and grants.
Our audit was conducted for the purpose of forming an opinion on the general purpose financial statements taken as a
whole. The schedules and additional information listed in the "Supplemental Information" section of the table of contents
to the financial section are presented for purposes of additional analysis and are not a required part of the general purpose
financial statements. Such additional information has been subjected to the auditing procedures applied in the audit of the
general purpose financial statements and, in our opinion, is fairly presented in all material respects in relation to the
general purpose financial statements taken as a whole.
The other data included in this report, designated as the "Statistical Section" in the table of contents, has not been audited
by us and, accordingly, we express no opinion on that data.
Harrison & Arnett, Chartered
Salina, Kansas
May 15, 2001
MEMBERS OF
DIVISION FOR CPA FIRMS PRIVATE COMPANIES PRACTICE SECTION
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS
KANSAS SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS
17
(THIS PAGE INTENTIONALLY LEFT BLANK)
W -:3
(THIS PAGE INTENTIONALLY LEFT BLANK)
Iwo
SALINA AIRPORT AUTHORITY
COMPARATIVE BALANCE SHEETS
ASSETS
2000
CURRENT ASSETS:
December 31
1999
Cash and cash equivalents
$ 511,730
$ 73,661
Accounts and note receivable
126,202
121,512
Prepaid expenses
502
2,524
Taxes receivable
692,370
714,772
Total Current Assets
1,330,804
912,469
RESTRICTED ASSETS:
Cash and cash equivalents
85,000
85,000
NET INVESTMENT IN FINANCING LEASE
1,195,973
1,260,228
NET INVESTMENT IN FIXED ASSETS
23,094,510
24,584,752
OTHER ASSETS:
Bond issue costs, less accumulated amortization
of $82,424 and $62,273 respectively
111,688
102,094
TOTAL ASSETS
$ 25,817,975
$ 26,944,543
(continued)
See notes to financial statements.
20
SALINA AIRPORT AUTHORITY
COMPARATIVE BALANCE SHEETS
(continued)
LIABILITIES AND EQUITY December 31
2000 1999
CURRENT LIABILITIES:
Accounts payable- operations
$ 23,821
$ 17,889
Accounts payable - capital
37,235
7,587
Accrued payroll and expenses
30,550
33,115
Accrued property tax
60,118
82,661
Deferred tax revenue
692,370
714,772
Deferred maintenance agreement
23,243
21,120
Deferred rent
35,510
12,916
Total Current Liabilities
902,847
890,060
RESTRICTED LIABILITIES:
Accrued interest payable 73,378 108,410
Deferred interest - financing lease 68,666 65,092
Current maturities of long -term debt 663,998 738,978
Total Restricted Liabilities 806,042 912,480
LONG -TERM LIABILITIES:
Bonds and note payable, less current maturities 41417,553 5,751,551
Total Liabilities 6,126,442 7,554,091
EQUITY:
Contributed capital, Federal Grants
9,510,507
10,093,641
Retained earnings
10,181,026
9,296,811
Total Equity
19,691,533
19,390,452
TOTAL LIABILITIES AND EQUITY
$25,817,975
$26,944,543
See notes to financial statements.
21
SALINA AIRPORT AUTHORITY
COMPARATIVE STATEMENTS OF REVENUES, EXPENSES
AND CHANGES IN RETAINED EARNINGS
NON - OPERATING INCOME (EXPENSE):
Mill levy 801,237 783,363
Interest on investments and financing lease 163,512 158,858
Interest expense (276,092) (369,561)
Net Non - Operating Income 688,657 572,660
NET INCOME (LOSS) 301,081 17,267
ADD DEPRECIATION ON ASSETS ACQUIRED THROUGH
FEDERAL CONTRIBUTIONS 583,134 595,779
INCREASE (DECREASE) IN RETAINED EARNINGS 884,215 613,046
RETAINED EARNINGS, January 1 9,296,811 8,683,765
RETAINED EARNINGS, December 31 $10,181,026 $9,296,811
See notes to financial statements.
22
January 1 to December 31
2000
1999
OPERATING REVENUES:
Rental revenues
$ 1,121,194
$1,202,149
Fixed base operator fees
263,264
234,338
Gain on sale of assets
222,664
-
Landing fees
12,133
10,660
Other operating revenues
25,992
26,965
Total Operating Revenues
1,645,247
1,474,112
OPERATING EXPENSES BEFORE DEPRECIATION
Office and administration
740,530
726,651
Maintenance
386,095
377,457
Total Operating Expenses Before Depreciation
1,126,625
1,104,108
OPERATING INCOME BEFORE DEPRECIATION
518,622
370,004
DEPRECIATION
906,198
925,397
OPERATING LOSS
(387,576)
(555,393)
NON - OPERATING INCOME (EXPENSE):
Mill levy 801,237 783,363
Interest on investments and financing lease 163,512 158,858
Interest expense (276,092) (369,561)
Net Non - Operating Income 688,657 572,660
NET INCOME (LOSS) 301,081 17,267
ADD DEPRECIATION ON ASSETS ACQUIRED THROUGH
FEDERAL CONTRIBUTIONS 583,134 595,779
INCREASE (DECREASE) IN RETAINED EARNINGS 884,215 613,046
RETAINED EARNINGS, January 1 9,296,811 8,683,765
RETAINED EARNINGS, December 31 $10,181,026 $9,296,811
See notes to financial statements.
22
SALINA AIRPORT AUTHORITY
COMPARATIVE STATEMENTS OF CASH FLOWS
(DIRECT METHOD)
CASH AND CASH EQUIVALENTS AT END OF YEAR
CONSISTS OF:
Unrestricted cash $ 511,730 $ 73,661
Restricted cash and cash equivalent 85,000 85,000
$ 596,730 $ 158,661
(continued)
See notes to financial statements.
23
January 1 to December 31
2000
1999
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from sales, commissions, fees and rents
$2,997,537
$1,386,088
Cash paid to employees for services
(443,968)
(420,315)
Cash paid to suppliers for goods and services
(699,812)
(635,344)
Net Cash Provided (Used) in Operating Activities
1,853,757
330,429
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
Purchase of property, plant and equipment
(720,694)
(1,460,223)
Proceeds from capital grants
-
97,971
Return of capital grant proceeds
-
(11,131)
Proceeds from property tax
801,237
783,363
Principal payments on debt
(1,408,978)
(1,983,013)
Principal received on financing lease
64,255
59,263
Interest received on financing lease
125,190
130,184
Principal received on long -term debt
-
94,760
Principal received on refunding debt
-
1,280,000
Bond defeasance and issue costs paid
(29,745)
(14,219)
Interest paid on long -term debt
(290,972)
(400,040)
Net Cash Provided (Used) in Capital and Related
Financing Activities
(1,459,707)
(1,423,085)
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest received on investments
44,049
32,628
INCREASE (DECREASE) IN CASH & CASH EQUIVALENTS
438,099
(1,060,028)
CASH BALANCE - January 1
158,661
1,218,689
CASH BALANCE - December 31
$ 596,760
$ 158,661
CASH AND CASH EQUIVALENTS AT END OF YEAR
CONSISTS OF:
Unrestricted cash $ 511,730 $ 73,661
Restricted cash and cash equivalent 85,000 85,000
$ 596,730 $ 158,661
(continued)
See notes to financial statements.
23
SALINA AIRPORT AUTHORITY
COMPARATIVE STATEMENTS OF CASH FLOWS
(DIRECT METHOD)
(continued)
RECONCILIATION OF OPERATING LOSS TO NET
CASH FLOWS FROM OPERATING ACTIVITIES
OPERATING LOSS
ADJUSTMENTS RECONCILING OPERATING LOSS
TO NET CASH PROVIDED BY OPERATING ACTIVITIES:
Depreciation
Basis of assets sold
CHANGES IN ASSETS AND LIABILITIES:
Decrease (increase) in accounts receivable
Increase (decrease) in accounts payable - operations
Increase (decrease) in accrued payroll expenses
Decrease (increase) in prepaid expense
Increase (decrease) in accrued property tax
Increase (decrease) in deferred rent
NET CASH PROVIDED BY OPERATING ACTIVITIES
See notes to financial statements.
24
December 31
2000 1999
$ (387,576) $(555,393)
906,198 925,397
1,334,386 -
(4,690)
5,932
(2,565)
2,022
(22,543)
22,594
(74,784)
5,289
3,493
(2,524)
42,191
(13,240)
$1,853,758 $ 330,429
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000 and 1999
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
A. Reporting Entity
The Salina Airport Authority was established by the City of Salina, pursuant to Chapter 27, Article 3,
of the Kansas Statutes Annotated for the purpose of acquiring surplus federal government property,
specifically the Schilling Air Force Base, located near the City of Salina. The .Authority administers
the airport commercial development and rental of associated real estate. The Authority is controlled
by a five - member Board of Directors appointed by the Salina City Commission and, in accordance
with Governmental Accounting Standards Board (GASB) Statement No. 1.4, the Authority is
considered to be a component unit of the City of Salina. The Authority is discreetly presented in the
City's comprehensive annual financial reports.
B. Measurement Focus, Basis of Accounting and Basis of Presentation
The Authority consists of an enterprise fund. Enterprise funds are classified as proprietary funds by
the GASB and are accounted for using a total economic resource measurement focus. The enterprise
fund is used to account for operations that are financed and operated in a matter similar to private
business enterprises. The intent of the Authority is that the costs of providing services on a continuing
basis be recovered through user fees and rents. The financial statements are prepared on the accrual
basis of accounting. Under the accrual basis, revenues are recognized as earned and expenses as
incurred. It is the Authority's policy to follow all Financial Accounting Standards Board (FASB)
standards issued after November 30, 1989, for its proprietary activities unless those new FASB
pronouncements conflict with GASB guidance.
C. Assets, Liabilities and Equity
1. Cash and Investments
The Authority's cash and cash equivalents are considered to be cash on hand, demand deposits and
short-term investments with original maturities of three months or less from date of acquisition. The
Authority held no investments during these years.
2. Receivables
Accounts Receivable. The Authority records revenues when services are provided. All receivables
are shown net of an allowance for uncollectibles.
Property taxes receivable. The determination of assessed valuations and the collections of property
taxes for all political subdivisions in the State of Kansas is the responsibility of the various counties.
The office of the County Appraiser annually determines assessed valuations and the County Clerk
spreads the annual assessment on the tax rolls. The County Treasurer is the tax collection agent for all
taxing entities within the county. In accordance with state statutes, property taxes are levied
November 1 of the current year and are a revenue source to be used to finance the budget of the
25
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000, and 1999
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — continued
C. Assets, Liabilities and Equity — continued
ensuing year. One -half of the property taxes are due December 20, prior to the fiscal year for which
they are budgeted, and the second half is due the following June 20.
Collection of current year property tax by the County Treasurer is not completed, apportioned nor
distributed to the various subdivisions until the succeeding year, such procedure being in conformity
with governing state statutes. Consequently, current year property taxes receivable are not available as
a resource that can be used to finance the current year operations of the Authority. It is the Authority's
practice to record uncollected current year property tax as an account receivable and to record the same
amount as deferred revenue. It is not practicable to apportion delinquent taxes held by the County
Treasurer and, further, the amounts thereof are not material in relationship to the financial statements
taken as a whole.
3. Inventories
The Authority maintains no significant inventory of office and maintenance supplies. These items are
expensed as purchased and no inventory is recorded in these financial statements.
4. Prepaid items
Certain payments to vendors reflect cost applicable to future accounting periods and are recorded as
prepaid items.
5. Restricted Assets
Certain proceeds of leasehold revenue bonds are classified as restricted assets on the balance sheet
because their use is limited by applicable bond covenants.
6. Fixed Assets
Fixed assets purchased or constructed are recorded at cost. The cost of normal maintenance and
repairs that do not add to the value of the assets or materially extend assets' lives are not included in
fixed assets cost. Fixed assets donated to the Authority are recorded at their estimated fair value at the
date of donation. Donated assets include property and equipment transferred to the Authority from the
United States of America, September 9, 1966 and recorded at fair value at that date for $529,872.
Major outlays for capital assets and improvements are capitalized as projects are constructed Interest
incurred during the construction phase of proprietary fund fixed assets is reflected in the capitalized
value of the asset constructed, net of interest earned on the invested proceeds over the same period. In
2000 and 1999, $0 and $4,216 interest was capitalized respectively.
26
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000 and 1999
I. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued
C. Assets, Liabilities and Equity — continued
6. Fixed Assets - continued
Fixed assets are depreciated using the straight -line method over the following estimated useful lives:
Assets
Years
Buildings
5-50
Equipment
5—
10
Vehicles
7-10
Airfield
10-30
Depreciation applicable to certain property and equipment which have been funded by or contributed
to the Authority by the federal government, is charged against the respective capital grant equity
balance. This charge is effected by transferring the applicable depreciation from retained earnings and
has no effect on income.
7. Compensated Absences
Substantially all full -time employees receive compensation for vacations, holidays, illness and certain
other qualifying absences. The number of days compensated for various categories of absence is
generally based on length of service. Liabilities relating to these absences are recognized as incurred
and included in accrued expenses. The amount accrued for such liabilities at December 31, 2000 and
1999 was $14,664 and $14,112 respectively.
II. STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
A. Budgetary Information
The Authority is specifically exempt from Kansas Budget Law. The Authority is not required tc
demonstrate statutory compliance with its annual operating budget. Accordingly, budgetary data is not
included in the financial statements.
B. Compliance With Bond Reserve Requirements
The Leasehold Revenue Bonds Series 1991 proceeds were used to construct a building and is leased to
a state university. The lease is a financing lease that transfers ownership of the building at the end of
the lease. The bond agreement established an $85,000 reserve requirement which the Authority has
met.
27
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000 and 1999
III. DETAILED NOTES
A. Deposits
At December 31, 2000 and 1999, the carrying amount of the deposits was $596,680 and $158,611 plus
$50 cash on hand respectively, and the bank balance was $692,822 and $166,055 respectively. The
difference between the carrying amount and the bank balance is outstanding checks and deposits in
transit. Of the bank balance, $166,055 and $200,000 respectively was covered by federal deposit
insurance and the remaining $1,056,606 at December 31, 1999 was collateralized by pledged
securities held under joint custody receipts issued by a third -party bank in the Authority's name. The
third -party bank holding the pledged securities is independent of the pledging bank. The pledged
securities are held under a tri-party custodial agreement signed by all three parties: the Authority, the
pledging bank, and the independent third -party bank holding the pledged securities.
December 31.2 00
UMB-
National Bank Sunflower
of America Bank Total
Gross Cash Balances
Demand deposit
Cash in checking - balance per books $ 10,383 $ 586,297 $ 596,680
Uncleared checks and deposits 96,650 508 97,158
Bank Balance
107,033
586,805
693,838
Less FDIC Coverage
100,000
100,000
200,000
Balances Securable by Collateral
Security Required
(100 %)
Security Profided by Depositories
Amount Undersecured by Statute
P -:1
$ 7,033 $ 486,805 $ 493,838
$ 7,033
111
$ 485,789
1,295,247
$ 492,822
1,380,247
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000 and 1999
III. DETAILED NOTES - continued
B. Receivables
Receivables as of year -end, including the applicable allowance for uncollectible accounts, are as
follows:
Total 18 572
C. Net Investment in Financing Lease
Net investment in financing lease is as follows:
2000
Total lease payments receivable $2,083,963
Less: Unearned income 887,990
Net investment in financing leases 1.195.973
Activity in net investment in financing leases was as follows:
Beginning Balance
Less: Collected principal
Ending Balance
29
December 31
December 31
1999
$ 123,012
714,772
837,784
1,500
1999
$2,273,408
1,013,180
12 22
Year Ended December 31
2000 1999
$1,260,228 $1,319,491
64,255 59,263
1 19 9 1 2 22
2000
Receivables:
Accounts
$ 94,312
Note receivable
36,142
Taxes
692,370
Gross receivable
822,824
Less: allowance for uncollectibles
(4,252)
Total 18 572
C. Net Investment in Financing Lease
Net investment in financing lease is as follows:
2000
Total lease payments receivable $2,083,963
Less: Unearned income 887,990
Net investment in financing leases 1.195.973
Activity in net investment in financing leases was as follows:
Beginning Balance
Less: Collected principal
Ending Balance
29
December 31
December 31
1999
$ 123,012
714,772
837,784
1,500
1999
$2,273,408
1,013,180
12 22
Year Ended December 31
2000 1999
$1,260,228 $1,319,491
64,255 59,263
1 19 9 1 2 22
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000 and 1999
III. DETAILED NOTES - continued
D. Fixed Assets
The following is a summary of the changes in the general fixed assets account group during the current
year.
The following is a summary of proprietary fund -type fixed assets at December 31, 2000 and 1999:
Land
Buildings and improvements
Airfield
Equipment
Less: Accumulated depreciation
Net Fixed Assets
30
December 31
2000 1999
$ 8,355,603
Balance
6,781,751
7,629,515
Balance
16,832,170
January 1,
1,420,30C!
$33,526,481
December 31,
2000
Additions
Dispositions
2000
Land
$ 8,427,792
$ 241,408
$ (313,597)
$ 8,355,603
Buildings and improvements
7,629,515
372,277
(1,220,041)
6,781,751
Airfield
16,832,170
93,549
-
16,925,719
Equipment
1,420,300
43,108
- _
1,463,408
34,309,777
750,342
(1,533,638)
33,526,481
Less: Accumulated
depreciation
9,725,025
906,198
(199,252)
10,431,971
Total
$25,584752
$(155.856)
(1.334.386_
23.094.510
The following is a summary of proprietary fund -type fixed assets at December 31, 2000 and 1999:
Land
Buildings and improvements
Airfield
Equipment
Less: Accumulated depreciation
Net Fixed Assets
30
December 31
2000 1999
$ 8,355,603
$ 8,427,792.
6,781,751
7,629,515
16,925,719
16,832,170
1,463,408
1,420,30C!
$33,526,481
$34,309,777
10,431,971 9,725,025
23.094.510 21584.75
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000 and 1999
III. DETAILED NOTES - continued
E. Long -Term Liabilities
Following is a summary of changes in long -term liabilities for year 2000:
Balance
$ 375,000
3.40% to 5.00%
Balance
January 1,
275,000
3.90% to 5.20 °%
December 31,
2000
Additions
Reductions
2000
General obligations bonds $5,570,000
$ -
$1,300,000
$4,270,000
Revenue bonds 500,000
-
60,000
440,000
Loan payable 420,529
-
48,978
371,551
6 Q 29
S -
$1,408,978
&5&& 1-5 5
The following is a detailed listing of the Authority's long -term
debt including
general obligation
bonds, revenue bonds and loan payable.
Original
Interest
Bonds
Issue
Rates
Outstanding
General Obligation Bonds
General Obligation 1993 -A, due 2003
$ 375,000
3.40% to 5.00%
$ 130,000
General Obligation 1993 -B, due 2003
275,000
3.90% to 5.20 °%
95,000
General Obligation 1998, due 2007
4,440,000
4.05% to 5.50%
3,550,000
General Obligation 1999 -B, due 2010
555,000
3.90% to 5.10%
495,000
Revenue Bonds
Leasehold revenue 1991, due 2006
Kansas Department of Commerce
and Housing Loan, due 2007
Total
Interest expense in 2000 is as follows:
General Obligation Bonds
Revenue Bonds
Loan
Add: Amortization of bonds costs
31
$4,270,000
$ 850,000 5.00% to 7.25% $ 440,000
$ 468,543 2% $ 371,551
1.
$ 212,768
35,005
8,167
255,940
17,673
273,613
III.
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000, and 1999
DETAILED NOTES - continued
E. Long -Term Liabilities - continued
Defeasance of Debt. The Authority, on May 3, 2000, deposited $754,745 in an irrevocable trust with
an escrow agent to provide for all future debt service payments on the 1999 -A Series bonds. As a
result, the 1999 -A Series bonds are considered to be defeased and the liability :For these bonds have
been removed from Long -Term Liabilities. The 1999 -A Series balance on May 3, 2000 was $725,000.
The deposited amount in excess of the Series balance has been added to bond issue cost and is to be
amortized over the remaining life of the Series.
Annual debt service requirements to maturity for general obligation bonds to be paid with tax levies
and rental revenues:
Annual debt service requirements to maturity for revenue bonds to be paid with rental revenues:
Bonds
Interest
Year
Outstanding
Due
Total
2001
565,000
183,514
748,514
2002
565,000
158,509
723,509
2003
565,000
133,565
698,565
2004
485,000
111,802
596,802
2005
485,000
91,534
576,534
To maturity
1,605,000
161,377
1,766,377
$4,270,M
28
$557.028
Annual debt service requirements to maturity for revenue bonds to be paid with rental revenues:
32
Bonds
Interest
Year
Outstanding
Due
Total
2001
60,000
31,104
91,104
2002
65,000
26,994
91,994
2003
70,000
22,510
92,510
2004
75,000
17,610
92,610
2005
80,000
12,285
92,285
To maturity
90,000
6,525
96,525
440
28
$557.028
32
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000 and 1999
III. DETAILED NOTES — continued
E. Long Term Liabilities - continued
Annual debt service requirements to maturity for Kansas Department of Commerce and Housing Loan
to be paid from rental revenues:
F. Retained Earnings and Contributed Capital
Under the provision of bond agreements, certain assets are restricted for specific uses. Retained
earnings which have been reserved relating to these restricted assets consist of the following:
Retained earnings:
Reserved under leasehold bond Series 1991
Unreserved retained earnings
Total retained earnings
Changes in grants and contributions are summarized as follows:
December 31
2000 1999
$ 85,000 $ 85,000
10,107,451 9,211,811
10.192.451 9.296.811
Balance January 1, 1999
1999 additions, AIP & HUD grants
1999 return of prior year AIP grant
Depreciation on property and equipment acquired by government grants
Balance December 31, 1999
2000 additions, AIP & HUD grants
Depreciation on property and equipment acquired by government grants
Balance December 31, 2000
33
Federal Grants
$10,602,580
97,971
(11,131)
(595,779)
10,093,641
(583,134)
• 1 1
Loan
Interest
Year
Principal
Due
Total
2001
49,963
7,182
57,145
2002
50,967
6,178
57,145
2003
51,991
5,154
57,145
2004
53,036
4,109
57,145
2005
54,103
3,043
57,146
To maturity
111,491
2,801
114,292
S371,551
F. Retained Earnings and Contributed Capital
Under the provision of bond agreements, certain assets are restricted for specific uses. Retained
earnings which have been reserved relating to these restricted assets consist of the following:
Retained earnings:
Reserved under leasehold bond Series 1991
Unreserved retained earnings
Total retained earnings
Changes in grants and contributions are summarized as follows:
December 31
2000 1999
$ 85,000 $ 85,000
10,107,451 9,211,811
10.192.451 9.296.811
Balance January 1, 1999
1999 additions, AIP & HUD grants
1999 return of prior year AIP grant
Depreciation on property and equipment acquired by government grants
Balance December 31, 1999
2000 additions, AIP & HUD grants
Depreciation on property and equipment acquired by government grants
Balance December 31, 2000
33
Federal Grants
$10,602,580
97,971
(11,131)
(595,779)
10,093,641
(583,134)
• 1 1
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000 and 1999
IV. OTHER INFORMATION
A. Defined Benefit Pension Plan
Plan description — The Authority participates in the Kansas Public Employees Retirement System
( KPERS). The plan is a cost - sharing multiple - employer defined benefit pension plan as provided by
Kansas statutes (KSA 74 -4901 et seq). KPERS provides retirement benefits, life insurance, disability
income benefits and death benefits. Kansas law establishes and amends benefit provisions. KPERS
issues a publicly available financial report that includes financial statements and required
supplementary information. Those reports may be obtained by writing to KPERS (611 S. Kansas
Avenue, Suite 100, Topeka, Kansas 66603 -3803) or by calling 1- 800 - 228 -0366.
Funding policy — KSA 74 -4919 establishes the KPERS member - employee contribution rate at 4% of
covered salary. The employer collects and remits member - employee contributions according to the
provision of section 414(h) of the Internal Revenue Code. State law provides that the employer
contribution rates be determined annually based on the results of an annual actuarial valuation.
KPERS is funded on an actuarial reserve basis. State law sets a limitation on annual increases in the
employer contribution rates. The KPERS employer rate established for calendar year 2000 is 2.33 %.
The Authority employer contributions to KPERS for the years ending December 31, 2000, 1999, and
1998 were $11,821, $11,147,and $9,908 respectively, equal to the required contributions for each year.
B. Deferred Compensation Plan
The Authority offers its employees a deferred compensation plan ( "Plan ") created in accordance with
Internal Revenue Code Section 457. The Plan, available to all Authority employees, permits them to
defer a portion of their salary until future years. The deferred compensation is not available to
employees until termination, retirement, death, or unforeseeable emergency. Plan assets are
transferred to a plan agent in a custodial trust and are not available to the claims of the Authority's
general creditors.
C. Flexible Benefit Plan (I.R.C. Section 125)
The Authority has adopted by resolution a salary- reduction flexible benefit plan ( "Plan ") under Section
125 of the Internal Revenue Code. All Authority employees working more than 20 hours per week are
eligible to participate in the Plan beginning after thirty days of employment. Each participant may
elect to reduce his or her salary to purchase benefits offered through the Plan. Benefits offered through
the Plan include various insurance and disability benefits.
D. Risk Management
The Authority is exposed to various risks of loss related to torts; theft of, damage to and destruction of
assets; errors and omissions; and natural disasters for which the Authority carries commercial
insurance. Settlements of claims did not exceed coverage for the years ended December 31, 2000,
1999 or 1998.
34
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000 and 1999
IV. OTHER INFORMATION - continued
E. Contingent Liabilities
The Authority receives significant financial assistance from numerous federal and state governmental
agencies in the form of grants and state pass - through aid. The disbursement of funds received under
these programs generally requires compliance with terms and conditions specified in the grant
agreements and is subject to audit. Any disallowed claims resulting from such audits could become a
liability of the Authority. However, in the opinion of management, any such disallowed claims would
not have a material effect on any of the financial statements of the Authority at December 31, 2000.
F. Environmental Matter
The Authority has been involved in discussions with the Corps of Engineers, Environmental Protection
Agency, and the Kansas Department of Health and Environment relative to the former Schilling Air
Force Base (the 'Base ") in Salina, Kansas. The Base was operational from 194.2 to 1965 when it was
decommissioned and became the current Salina Municipal Airport and Salina Airport Industrial
Center. During its period of operation, the Base was used for large aircraft inclining B -17s, B -29s, B-
47s and the refueling KC -97s and KC -135s. The Army Corps of Engineers did a removal of 107
former underground storage tanks at the former Base in 1995. In addition to efforts by the Corps of
Engineers, the Environmental Protection Agency has conducted an Expanded Site Investigation (ESI)
to determine all sources of potential contamination at the Site.
Once the additional information gathering effort has been conducted and all parties know the nature
and extent of contamination, we anticipate that there will be a discussion with respect to cleanup
options and allocation of responsibility. At this time, the Authority does not know specifically
whether the City of Salina or the Authority will have cleanup obligations.
G. Rental Income Under Operating Leases
A significant portion of the operating revenue of the Authority is generated through the leasing of
airport and building space to airport fixed base operators and others on a fixed fee as well as a
contingent rental basis. Ownership risks are retained by the Authority, and accordingly, such leases
are treated as operating leases.
9161
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000 and 1999
IV. OTHER INFORMATION - continued
G. Rental Income Under Operating Leases - continued
The following is a schedule of minimum future rentals on non - cancellable operating leases to be
received in each of the next five years and thereafter:
Years Ended
December 31
2001
$ 721,727
2002
595,741
2003
459,785
2004
400,150
2005
358,302
Later years
566,360
Total $3,102,065
H. Major Customers
The Authority receives significant operating and financing lease revenue from Raytheon Aircraft
Company, Kansas State University- Salina, Flower Aviation, Moore's Midway Aviation, Schwan's
Sales, and KASA Fab, Inc.. Rentals from these six tenants equals 57% of operating and capital lease
revenue for the year ended December 31, 2000.
I. Non - Operating Income
Net non - operating income consisted of the following for the years ended December 31, 2000 and
1999:
Interest expense
Revenue bond
2000
1999
Mill levy
$801,237
$783,363
Interest and investment income
8,167
9,132
Financing lease
119,493
126,230
Other interest
44,019
32,628
Total
964,749
942,221
Interest expense
Revenue bond
35,005
38,552
General obligation bonds
212,768
304,205
Other debt
8,167
9,132
Amortization of bond issue costs
20,152
17,672
Total
276,092
369,561
Net non - operating income
$fgg.657
572.660
91101
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2000 and 1999
IV. OTHER INFORMATION - continued
J. Commitment Under Operating Lease
The Authority has entered into a non - cancellable operating lease agreement for the rental of office
equipment. Minimum rentals, on an annual basis are as follows:
Years Ended
December 31
2001
$ 4,260
2002
4,260
2003
4,260
2004
4.260
9511 • 1
37
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Iffil
(THIS PAGE INTENTIONALLY LEFT BLANK)
39
SALINA AIRPORT AUTHORITY
SCHEDULES OF OPERATIONS AND CHANGES
IN RETAINED EARNINGS
(continued)
40
January 1 to December 31
2000
1999
OPERATING REVENUES
Building rents
$ 711,591
$ 802,744
Ramp rents
63,343
59,859
Land rents
195,687
212,927
Agri land rents
56,808
47,328
Hangar rents
86,453
72,172
Tank farm rents
7,312
7,118
Fuel flowage fees
263,264
234,338
Gain on sale of assets
222,664
-
Landing fees
12,133
10,660
Commissions
20,039
18,872
Other income
5,953
8,094
TOTAL OPERATING REVENUES
1,645,247
1,474,112
OPERATING EXPENSES BEFORE DEPRECIATION
ADMINISTRATIVE EXPENSES
Airport promotion
49,515
37,058
Computer/Network Administration
5,132
-
Dues and subscriptions
15,095
11,909
Employees retirement
11,823
11,148
Engineering
3,487
5,645
FICA tax
32,337
31,912
Industrial development
19,999
20,000
Insurance - medical
75,980
70,927
Insurance - property /liability
56,616
46,364
Kansas unemployment tax
417
417
Legal and accounting
38,919
38,428
Office salaries
219,527
209,282
Office supplies
9,836
7,272
Other administrative
11,724
19,213
Postage
4,661
4,522
Property appraisals
2,760
2,950
Property taxes
140,648
171,752
Telephone
11,795
11,890
Travel and meetings
30,259
25,962
TOTAL ADMINISTRATIVE EXPENSES
740,530
726,651
(continued)
40
SALINA AIRPORT AUTHORITY
SCHEDULES OF OPERATIONS AND CHANGES
IN RETAINED EARNINGS
(continued)
NON - OPERATING INCOME (EXPENSE)
Mill levy 801,237 783,364
Interest income - capital lease 119,493 126,230
Interest income 44,019 32,628
Bond interest - expense (255,940) (351,890)
Amortization of bond costs (20,152) (17,672)
NET NON - OPERATING INCOME 688,657 572,660
NET INCOME (LOSS) 301,080 17,267
ADD DEPRECIATION ON ASSETS ACQUIRED THROUGH
FEDERAL CONTRIBUTIONS (Note 1) 583,134 595,779
INCREASE (DECREASE) IN RETAINED EARNINGS 884,214 613,046
RETAINED EARNINGS, January 1 9,296,811 8,683,765
RETAINED EARNINGS, December 31 $ 10,181,025 $ 9,296,811
41
January 1 to December 31
2000
1999
MAINTENANCE EXPENSES
Airfield maintenance
8,516
14,908
Building maintenance
41,365
36,392
Equipment gas, oil & repairs
24,416
16,843
Fire department expense
3,737
4,602
Grounds maintenance
2,081
2,365
Maintenance salaries
221,876
214,526
Other maintenance expenses
12,586
12,497
Snow removal expense
3,906
6,600
Utilities
67,613
68,724
TOTAL MAINTENANCE EXPENSES
386,096
377,457
TOTAL OPERATING EXPENSES BEFORE
DEPRECIATION
1,126,626
1,104,108
OPERATING EARNINGS BEFORE DEPRECIATION
518,621
370,004
DEPRECIATION EXPENSE
906,198
925,397
OPERATING PROFIT (LOSS)
(387,577)
(555,393)
NON - OPERATING INCOME (EXPENSE)
Mill levy 801,237 783,364
Interest income - capital lease 119,493 126,230
Interest income 44,019 32,628
Bond interest - expense (255,940) (351,890)
Amortization of bond costs (20,152) (17,672)
NET NON - OPERATING INCOME 688,657 572,660
NET INCOME (LOSS) 301,080 17,267
ADD DEPRECIATION ON ASSETS ACQUIRED THROUGH
FEDERAL CONTRIBUTIONS (Note 1) 583,134 595,779
INCREASE (DECREASE) IN RETAINED EARNINGS 884,214 613,046
RETAINED EARNINGS, January 1 9,296,811 8,683,765
RETAINED EARNINGS, December 31 $ 10,181,025 $ 9,296,811
41
SALINA AIRPORT AUTHORITY
CAPITAL EXPENDITURES
LAND
ATCT Site Prep
Environmental assessment and costs
Foundation removal
Replat
Secondary street project
Utility and street improvement design
Water line improvement
TOTAL LAND
EQUIPMENT
1998 Olds Bravada
ARFF equipment
Computer
Lobby furnishings
Pressure wash
Radios
Sidewalk, building 122
Signage
TOTAL EQUIPMENT
BUILDINGS AND IMPROVEMENTS
Micro surface P- hangar parking
Other building improvements
Ovation Cabinetry facility design
Parking lots
Raytheon construction and design
Restrooms
Roofing
Wireless internet equipment
TOTAL BUILDINGS
AIRFIELD AND INFRASTRUCTURE
Airfield markings
Airservice consultant
Lamps
TXY T design
TOTAL OTHER IMPROVEMENTS
TOTAL CAPITAL EXPENDITURES
42
January 1 to December 31
2000
$ 5,855
166,291
14,000
4,377
15,215
29,000
6,670
241,408
18,845
8,054
5,479
1,880
452
4,522
1,375
2,501
43,108
9,487
25,691
77,778
23,251
161,010
32,750
40,581
1,729
372,277
52,494
20,674
4,687
15,693
93,548
$750,341
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGATION BONDS
SERIES 1993 - A
December 31, 2000
Dec. 6, 1993
$ 375,000
3.40% to 5.00%
Sept. 1, 2003
$ 245,000
$ 130,000
Schedule of Bond Interest and Principal Payments
Due in
Bond
Bond
Year
Interest
Principal
2001
5,532
40,000
2002
3,892
45,000
2003
990
45,000
Thereafter
-
-
$10,414
$ 130,000
43
Date of issue:
Amount of issue:
Interest rate:
Maurity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGATION BONDS
SERIES 1993 - B
December 31, 2000
Schedule of Bond Interest and Principal Payments
Due in
Year
2001
2002
2003
Thereafter
44
Bond
Interest
4,185
2,894
788
$ 7,867
Dec. 1, 1993
$275,000
3.85% to 4.75%
Sept. 1, 2003
$180,000
$ 95,000
Bond
Principal
30,000
30,000
35,000
$ 95,000
Date of issue:
Amount of issue:
Interest rate:
Maurity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGATION BONDS
SERIES 1998 - A
December 31, 2000
June 29, 1998
$4,440,000
4.05% to 5.50%
Sept. 1, 2008
$ 890,000
$3,550,000
Schedule of Bond Interest and Principal Payments
Due in
Bond
Bond
Year
Interest
Principal
2001
150,422
445,000
2002
130,398
445,000
2003
112,375
445,000
2004
94,130
445,000
2005
75,662
445,000
Thereafter
114,172
1,325,000
$ 677,159
$3,550,000
45
Date of isue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGATION REFUNDING BONDS
SERIES 1999 - B
December 31, 2000
Schedule of Bond Interest and Principal Pa ments
Due in
Year
June 29, 1999
$ 555,000
3.90% to 5.200/c
Sept. 1, 2010
$ 60,000
$ 495,000
Bond Bond
Interest Principal
2001
23,375
50,000
2002
21,325
45,000
2003
19,412
40,000
2004
17,672
40,000
2005
15,872
40,000
Thereafter
47,205
280,000
46
$144,861 $ 495,000
Date of issue:
Amount of issue:
Interest rate:
Maturity rate:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
LEASEHOLD REVENUE BONDS
SERIES 1991
December 31, 2000
Nov. 1, 1991
$850,000
5.00% to 7.25%
Sept. 1, 2006
$410,000
$440,000
Schedule of Bond Interest and Principal Payments
Due in
Bond
Bond
Year
Interest
Principal
2001
31,104
60,000
2002
26,994
65,000
2003
22,510
70,000
2004
17,610
75,000
2005
12,285
80,000
Thereafter
6,525
90,000
47
$117,028 $440,000
SALINA AIRPORT AUTHORITY
KANSAS DEPARTMENT OF COMMERCE AND HOUSING, LOAN PAYABLE
December 31, 2000
Date of loan:
Amount of loan:
Interest Rate:
Maturity date:
Principal paid:
Outstanding balance:
Schedule of Loan Interest and Principal Payments
Due in
Year
Oct. 1, 1998
$ 468,543
2%
Oct. 1, 2007
$ 96,992
$ 371,551
Loan Loan
Interest Principal
2001
7,182
49,963
2002
6,178
50,967
2003
5,154
51,991
2004
4,109
53,036
2005
3,043
54,103
Thereafter
2,801
111,491
48
$ 28,467 $ 371,551
ITT Hartford Public Employees Blanket Bond
Policy # 37BPEAG4896 Honesty blanket
position bond coverage $ 100,000
Coregis Insurance Co. Public Officials & Empl. Liability
Policy # POI - 000227 -4 Errors & ommissions
excluding asbestos,
excluding pollution coverage
on a claims made basis,
5,000 deductible $ 500,000
American Alliance Ins. Co. Kansas UST Liability
Pol. # KST 788- 29 -33 -06 Environmental Incident $ 1,000,000
Annual aggregate $ 1,000,000
Limit of Defense $ 100,000
5,000 deductible
..
SALINA AIRPORT AUTHORITY
INSURANCE IN FORCE
December 31, 2000
AMOUNT OF
INSURANCE POLICY
TYPE OF COVERAGE
COVERAGE
Employers Insurance Co.
Workmen's Compensation
of Wausau
and Employer's Liability
$
500,000
Policy # 711100070135
National Union Fire Ins. Co.
Bodily Injury & Liability
$
500,000
of Pittsburgh, PA
Hangar Keepers
$
500,000
Pol. # AP322945606
Travelers Insurance Co.
Fire & Lightning,
Policy # 630594X3132
extended coverage,
vandalism & malicious mischief
$
8,643,443
Business Personal Prop.
$
944,857
Loss of Rents
$
1,378,458
Travelers Insurance Co.
Boiler & Machinery
$
1,000,000
Policy # BMG893K5282
Office and stores
$
500,000
Travelers Insurance Co.
Business Auto
Policy # 810306K2188
Liability
$
500,000
Medical payments
$
2,000
Uninsured motorists
$
500,000
ITT Hartford Public Employees Blanket Bond
Policy # 37BPEAG4896 Honesty blanket
position bond coverage $ 100,000
Coregis Insurance Co. Public Officials & Empl. Liability
Policy # POI - 000227 -4 Errors & ommissions
excluding asbestos,
excluding pollution coverage
on a claims made basis,
5,000 deductible $ 500,000
American Alliance Ins. Co. Kansas UST Liability
Pol. # KST 788- 29 -33 -06 Environmental Incident $ 1,000,000
Annual aggregate $ 1,000,000
Limit of Defense $ 100,000
5,000 deductible
..
(THIS PAGE INTENTIONALLY LEFT BLANK)
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51
Salina Airport Authority
OPERATING EXPENSE HISTORY
Ten Years Ended December 31, 2000
52
Office &
Total
Administrative
Maintenance
Operating
Fiscal Year
Expense
Expense
Expense
1991
408,578
329,137
737,715
1992
415,819
347,498
763,317
1993
458,918
361,412
820,330
1994
467,803
370,266
838,069
1995
481,914
375,594
857,508
1996
497,561
398,287
895,848
1997
568,606
367,530
936,136
1998
631,072
377,551
1,008,623
1999
726,651
377,457
1,104,108
2000
740,530
386,096
1,126,626
52
Salina Airport Authority
FEDERAL FINANCIAL ASSISTANCE HISTORY
Ten Years Ended December 31, 2000
NOTE:
1. 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.
2. During 1998, the SAA was awarded a Community Development Block
Grant from the Kansas Department of Commerce and Housing in the amount of $1,031,219.
The proceeds were used to reconstruct over 6.5 miles of secondary streets within the
Salina Airport Industrial Center. 50% of the awarded amount was a true grant. The other 50%
was a loan which is recorded as a long term liability under Bonds and Note Payable on the
Balance Sheet.
3. During 1999, the SAA closed out two (2) Airport Improvement Projects. AIP No. 18 closeout
resulted in the SAA refunding the Federal Aviation Administation in the amount of $11,132.
The SAA received a final reimbursment in the amount of $3,212 to closeout AIP No. 19.
53
Federal Aviation
Housing] & Urban
Administration
Devellopment
Airport
Community Development
Fiscal Year
Improvement Grants
Block Grant
1991
29,430
1992
335,349
1993
30,162
1994
270,191
1995
3,210,933
1996
2,006,786
1997
1,640,967
1998
1,026,918
841,700
1999
<7,920>
189,520
2000
0
0
NOTE:
1. 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.
2. During 1998, the SAA was awarded a Community Development Block
Grant from the Kansas Department of Commerce and Housing in the amount of $1,031,219.
The proceeds were used to reconstruct over 6.5 miles of secondary streets within the
Salina Airport Industrial Center. 50% of the awarded amount was a true grant. The other 50%
was a loan which is recorded as a long term liability under Bonds and Note Payable on the
Balance Sheet.
3. During 1999, the SAA closed out two (2) Airport Improvement Projects. AIP No. 18 closeout
resulted in the SAA refunding the Federal Aviation Administation in the amount of $11,132.
The SAA received a final reimbursment in the amount of $3,212 to closeout AIP No. 19.
53
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REVENUE BOND COVERAGE
Ten Years Ended December 31, 2000
Fiscal
Pledged
Revenue Bond
Year
Revenue
Debt Service
Coverage
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
163,215
1.16
1996
189,446
163,790
1.16
1997
189,446
168,962
1.12
1998
189,446
163,938
1.16
1999
189,446
163,841
1.16
2000
189,446
185,013
1.02
Notes:
1. During 1999, the Series 1990 -B Bonds
were refinanced to remove IRS restrictions and
achieve an interest rate savings.
Source: Salina Airport Authority Records
55
Salina Airport Authority
Principal Customers
Year Ended December 31, 2000
Notes:
Total Operating Lease and Direct Finance Lease Revenue for 2000 was $1,612,029
Source: Salina Airport Authority Records
56
% of Operating & Direct
Company
Revenue
Finance Lease Revenue
Raytheon Aircraft Co.
$246,675
15.300ro
Kansas State University
$194,486
12.06%
Flower Aviation
$146,753
9.10%
Moore's Midway Aviation
$140,224
8.70%
Schwan's Sales, Inc.
$119,426
7.41%
KASA Fab, Inc,
$73,420
4.55%
ElDorado National
$40,537
2.51%
Palleton of Kansas, Inc.
$21,600
1.34%
Lanseair of Salina
$19,950
1.24%
Salina Vortex Corporation
$19,625
1.22%
Geocore Services
$19,515
1.21%
Kejr, Joe
$19,118
1.19%
Federal Aviation Admin.
$18,600
1.15%
Builders Choice Concrete
$17,490
1.08%
Two Rivers Vending Co.,lnc.
$16,804
1.04%
Coronado Engineering
$15,600
0.97%
Salina Aircraft Sales, Inc.
$15,000
0.93%
Waddle's Manufacturing & Machine
$15,000
0.93%
Laas, Brent
$14,550
0.90%
L & R Farms
$13,196
0.82%
Snak -Atak
$12,787
0.79%
Tiger Corp /Avis Rent -A -Car
$12,525
0.78%
WWC License LLC
$12,252
0.76%
Blicks Agri -Farm Cen
$12,000
0.74%
Great Lakes Aviation, LTD
$11,984
0.74%
ADM Milling Co.
$11,813
0.73%
Mesa Airlines /Air Midwest
$11,476
0.71%
Aerospace Systems & Tech. Inc.
$11,325
0.70%
Palmer Trucking Co.
$11,220
0.70%
Roto - Reclaimer Corporation
$11,125
0.69%
TVCN of Kansas
$9,720
0.60%
Central Kansas Auto Rental
$9,369
0.58%
Salina Snack Sales
$9,140
0.57%
Scientific Engineering
$8,700
0.54%
Land of OZ Meats
$7,500
0.47%
Salina Auto Auction
$7,200
0.53%
Notes:
Total Operating Lease and Direct Finance Lease Revenue for 2000 was $1,612,029
Source: Salina Airport Authority Records
56
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57
Salina Airport Authority
MILL LEVY REVENUE
Ten Years Ended December 31, 2000
Fiscal Year
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
Source: Salina Airport Authority Records
G,�]-
Mill Levy
Revenue
0
N
0
$301,829
$406,232
$357,887
$338,058
$322,270
$783,363
$801,237
Salina Airport Authority
AIR TRAFFIC, FUEL FLOWAGE AND ENPLANEMENT TRENDS
Ten Years Ended December 31, 2000
Fiscal
Air Traffic
Fuel Flowage
Year
Operations
Gallons
1991
83,372
2,681,605
1992
71,697
2,552,156
1993
66,144
2,126,230
1994
61,215
2,424,880
1995
68,291
2,435,656
1996
62,021
2,907,894
1997
68,822
3,577,650
1998
80,338
3,603,673
1999
90,400
3,808,886
2000
87,709
4,472,164
Note:
One air traffic operation equals one aircraft takeoff and landing
Source: Salina Airport Authority Records
59
Scheduled
Air Service
Enplanements
5,391
5,799
5,591
7,175
7,813
8,652
9,153
12,909
13,436
10,270
Salina Airport Authority
MAJOR EMPLOYERS IN THE SALINA/SALINE COUNTY AREA
December 31, 2000
Major Private Employers
Approx. # Type of
Company Employees Business
Tony's Pizza
2,100
Frozen Foods Manufacturer
Salina Reg. Med. Center
1,082
Health Care
Exide Corporation
825
Battery Manufacturing
Raytheon Aircraft Co.
653
Aircraft Sub - assemblies Manuf.
Philips Lighting
620
Fluorescent Lamp Manufacture
Great Plains Manufacturing
600
Farm Implements & Landscaping Equipment
Solomon Corp.
272
Electrical Equipment
Eldorado National, Inc.
264
Medium & Small Shuttle Buses
OCCK
263
Plastic products, Subcontracting
Wal -Mart
183
Retail
KASA/KASA Fab
153
Electronic Controls & Steel Fabrication
Advance Auto /Parts America
150
Warehouse Distribution
Crestwood Cabinets, Inc.
144
Custom Made Cabinets
Exline
130
Structural steel fabrication
Salina Journal
130
Newspaper Publishing
Sunflower Bank
120
Bank
Premier Pneumatics
115
Pneumatic Convey Equipment
Blue Beacon Int'I
104
Truck Wash
PKM Steel
103
Steel Fabrication
Major Public Employers
Approx. #
Public Organizations Employees Type of Public Bodv
Unified School District #305 935 School System
City of Salina 471 City Government
Saline County 233 County Government
US Postal Service 128 Postal Service
Kansas State University - Salina 126 Engineering Technology & Aviation Technology
Source: Salina Area Chamber of Commerce
.1
Salina Airport Authority
SALINE COUNTY POPULATION, DEMOGRAPHIC AND LABOR STATISTICS
Year Population
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
Demographics
Median Age
Number of Households
Median Household Income
Per Capita Income
49,365
49,991
50,517
51,066
51,346
51,783
51,820
51,637
51,399
51,379
33.5
19,826
$33,711
$27,294
Employment and Civilian Labor Force
Saline County Population
53,000
52,000
51,000
50,000
49,000
48,000 � . . .. . . .... ...
o d o h o d a
^oo ^oo goo roe roe ^oo goo goo goo �o
Civilian Labor
Year Force Employed Unemployed
1988
27,776
26,365
1,411
1989
27,954
26,772
1,182
1990
28,454
27,261
1,193
1991
29,356
28,179
1,177
1992
30,409
29,270
1,139
1993
28,549
27,261
1,288
1994
28,093
26,804
1,289
1995
30,412
29,027
1,385
1996
29,752
28,596
1,156
1997
29,918
28,832
1,086
1998
30,389
29,334
1,055
1999
30,765
30,006
759
Employment and civilian Labor Force
32,000
30,000
28,000
26,000
24,000
4b 4bl 40", 19014 '�96
Sources: Institute for Public Policy and Business Research, University of Kansas and
Kansas Department of Human Resources Labor Market Information Services
61
Salina Airport Authority
SALINE COUNTY EMPLOYMENT DATA
1986
6.1
1987
5.6
1988
5.1
1989
4.2
1990
4.2
1991
4.0
1992
3.7
1993
4.5
1994
4.6
1995
4.6
1996
3.9
1997
3.6
1998
2.6
1999
2.3
2000
2.7
Unemployment Rate
1998 1988
Total Employment
38,828
31,399
Services
11,201
8,919
Retail Trade
7,847
6,186
Manufacturing
6,928
5,166
Government & Gov't Services
4,233
3,465
Construction
2,198
1,497
Finance, Insurance, Real Estate
1,926
1,666
Wholesale Trade
1,740
1,879
Transportation
..�8+x�s� m- w.aG..a
.✓.xxr�x, ���'.�..F.tv ...mow -,y.
,. ,.�{'.
794
890
Ag. Services
325
229
Mining
113
1998 1988
Total Employment
38,828
31,399
Services
11,201
8,919
Retail Trade
7,847
6,186
Manufacturing
6,928
5,166
Government & Gov't Services
4,233
3,465
Construction
2,198
1,497
Finance, Insurance, Real Estate
1,926
1,666
Wholesale Trade
1,740
1,879
Transportation
1,523
1,168
Farm
794
890
Ag. Services
325
229
Mining
113
334
Source: Institute for Public Policy and Business Research
University of Kansas, Salina /Saline County Profile Report
62
HARRISON & ARNETT
CHARTERED
CERTIFIED PUBLIC ACCOUNTANTS
EUGENE O. HARRISON, C.P.A. 717 ROACH STREET • SALINA, KANSAS 67401 PHONE: (785) 827 -7244
THOMAS G. ARNETT, C.P.A. FAX: (785) 827 -0048
REPORT ON COMPLIANCE AND ON INTERNAL CONTROL OVER FINANCIAL
REPORTING BASED ON AN AUDIT OF FINANCIAL STATEMENTS PERFORMED
IN ACCORDANCE WITH GOVERNMENT AUDITING STANDARDS
To the Board of Directors
Salina Airport Authority
Salina, Kansas
We have audited the financial statements of Salina Airport Authority, a component unit of the City of Salina, Kansas, as
of and for the years ended December 31, 2000 and 1999, and have issued our report thereon dated May 15, 2001. We
conducted our audit in accordance with generally accepted auditing standards and the standards applicable to financial
audits contained in Government Auditing Standards, issued by the Comptroller General of the United States.
Compliance
As part of obtaining reasonable assurance about whether Salina Airport Authority's financial statements are free of
material misstatement, we performed tests of its compliance with certain provisions of laws, regulations, contracts and
grants, noncompliance with which would have a direct and material effect on the determination of financial statement
amounts. However, providing an opinion on compliance with those provisions was not an objective of our audit and
accordingly, we do not express such an opinion. The results of our tests disclosed no instances of noncompliance that are
required to be reported under Government Auditing Standards.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Salina Airport Authority's internal control over financial reporting in
order to determine our auditing procedures for the purpose of expressing our opinion on the general purpose financial
statements and not to provide assurance on the internal control over financial reporting. Our consideration of the internal
control over financial reporting would not necessarily disclose all matters in the internal control over financial reporting
that might be material weaknesses. A material weakness is a condition in which the design or operation of one or more of
the internal control components does not reduce to a relatively low level the risk that misstatements in amounts that would
be material in relation to the financial statements being audited may occur and not be detected within a timely period by
employees in the normal course of performing their assigned functions. We noted no matters involving the internal
control over financial reporting and its operation that we consider to be material weaknesses.
This report is intended solely for the information and use of the audit committee, management, others within the
organization, Board of Directors, and federal awarding agencies and pass - through entities and is not intended to be and
should not be used by anyone other than these specified parties.
Harrison & Arnett, Chartered
Salina, Kansas
May 15, 2001
MEMBERS OF
DIVISION FOR CPA FIRMS PRIVATE COMPANIES PRACTICE SECTION
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS
KANSAS SOCIETY OF CERTIFIED PUBLIC ACCOUNTANTS
63
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64