6.3 Ordinance No. 23-11147 Salina Airport Authority GO BondsCITY OF SALINA
REQUEST FOR CITY COMMISSION ACTION DATE TIME
03/27/2023 4:00 P.M.
AGENDA SECTION
NO: 6
ITEM
NO:
Page 1
ITEM:
Ordinance No. 23-11147
ORIGINATING DEPARTMENT
Finance & Administration
BY: Debbie Pack, Director
FISCAL APPROVAL:
BY: y
FINAL APPROVAL:
BY: A A<`-
An Ordinance Unconditionally Approving the Issuance of General Obligation Bonds by the Salina
Airport Authority for the purpose of financing the cost of certain capital improvements located at the
Salina Regional Airport and Airport Industrial Center.
BACKGROUND:
The Salina Airport Authority (the "Authority") was established in 1965 by the City of Salina pursuant
to Kansas enabling legislation enacted that year. K.S.A. 27-323 (attached) authorizes the Authority
to issue its own general obligation bonds not in excess of 10% of the assessed valuation of all the
taxable tangible property within the city. The statute also provides that: "If the Authority desires to
issue its general obligation bonds, the board of directors shall adopt a resolution setting forth the
principal amounts of bonds proposed to be issued and the purpose for which the bonds are to be
issued, and shall forward a copy of such resolution to the mayor of the city. The mayor shall present
such resolution to the governing body of the city for its approval or disapproval." The governing body
then has three choices:
(1) To disapprove the Authority's resolution by ordinance;
(2) To unconditionally approve the Authority's resolution by ordinance; or
(3) To approve the Authority's resolution and to publish a notice of the Authority's intent to
issue its general obligation bonds, subjecting the bond issue to a referendum election if a
protest petition is signed by not less than 20% of the qualified electors of the city and filed
within 15 days of the published notice.
K.S.A. 27-323 further authorizes the Authority to levy a tax on all taxable tangible property within the
city in an amount sufficient to pay the interest on and principal of the bonds.
On March 15, 2023, the Board of Directors of the Authority adopted Resolution No. 23-04 approving
the issuance of not to exceed $10,235,000 (exclusive of costs of issuance and any temporary
financing costs) of general obligation bonds of the Authority to pay the cost of certain capital
improvements located at the Salina Regional Airport and Airport Industrial Center, including, but not
limited to:
The design and construction of General Aviation Hangars at the estimated total
cost of $3,005,856 (the "General Aviation Hangar Project")
The design and construction of improvements to Hangar 626 to house aircraft
modification, maintenance, repair and overhaul operations at the estimated total
cost of $6,174,608 (the "Hangar 626 MRO Proje
AGENDA SECTION
NO:
ITEM
NO:
Page 2
CITY OF SALINA
REQUEST FOR CITY COMMISSION ACTION DATE TIME
03/27/2023 4:00 P.M.
ORIGINATING DEPARTMENT
Finance & Administration
BY: Debbie Pack, Director
FISCAL APPROVAL:
BY:
FINAL APPROVAL:
BY:
The design and construction of an above ground aviation fuel facility and all
improvements related thereto at an estimated total cost of $8,481,108 (the "Fuel
Facility Project" and together with the General Aviation Hangar Project and
Hangar 626 MRO Project, the "Projects")
The balance of Project costs not funded with general obligation bonds will be provided for with a
combination of federal funds and available Authority cash.
Attached are copies of the Authority's Resolution No. 23-04 and the proposed ordinance
unconditionally approving the proposed issuance of the Authority's general obligation bonds.
FISCAL NOTE:
While the Authority's proposed general obligation financing is backed by the full faith and credit of the
Authority, K.S.A. 27-323(a) specifically provides that "such general obligation bonds of the authority
shall not constitute a debt or obligation of the city which established and created the authority." The
bonds proposed by the Authority do not count toward the City's bonded indebtedness limitations.
The Authority has advised that, if approved, the Authority expects to issue twenty-year general
obligation bonds to finance portions of the design and construction of these projects and certain other
projects previously authorized by the Authority and approved by the City. Including the projects
authorized by Resolution No. 23-04, the Authority anticipates issuing general obligation bonds in the
approximate amount of $16,725,000 in 2023.
According to the Authority's 2021 audit, the following is a schedule of current debt payments:
Sal in Airport Authority
Annual Debt Service Payments
Debt Schedule
Balance 12/31/21
2022
2023
2024
2025
2026
2027-2031 2032-2036
General Obligation Bonds
19,572,949
2,211,056
2,208,754
2,214,540
2,221,120
2,228,633
10,943,284 889,780
Temporary Notes
5,645,000
22,975
5,671,033
valuation
Lease Purchase Agreements
420,058
54,328
54,328
54,328
54,327
54,328
217,311
25,638,007
2,288,359
7,934,115
2,268,868
2,275,447
2,282,961
11,160,595 889,780
K.S.A. 27-322 allows the Authority to levy tax as follows:
Statute
Purpose
Limit
27-322(a)
Furtherance of purposes of
3.0 mills
authority
27-322(b)
Matching funds to federal or
1.0 mill
state grant
27-323(a)
Pay for interest and principal of
Bonds <10% of assessed
bonds
valuation
CITY OF SALINA
REQUEST FOR CITY COMMISSION ACTION DATE TIME
03/27/2023 4:00 P.M.
AGENDA SECTION ORIGINATING DEPARTMENT: FISCAL APPROVAL:
NO:
BY:
ITEM Finance & Administration FINAL APPROVAL:
NO:
Page 3 BY: Debbie Pack, Director BY:
The following table shows the historical mill levy for the Authority:
K.S.A. 27-
323a K.S.A. 27-322b
Budget Year Debt Match grant Total Levy
2013 4.007
2014 4.504
2015 4.486
2016 4.396 4.396
2017 4.396 4.396
2018 4.225 4.225
2019 4.096 0.902 4.998
2020 4.447 0.925 5.372
2021 4.037 1.000 5.037
2022 3.909 0.929 4.838
2023 3.99 0.978 4.968
The Airport Authority's 2023 mill levy for their 2024 budget year is forecasted not to exceed 6.990.
COMMISSION RECOMMENDED ACTION:
Staff has identified the following options for the City Commission's consideration:
1.) Approve Ordinance No. 23-11147 unconditionally approving the Issuance of General Obligation
Bonds by the Salina Airport Authority for the purpose of financing the cost of the Projects.
2.) Direct staff to prepare an ordinance to disapprove the Authority's resolution.
3.) Direct staff to prepare a resolution approving the Authority's resolution and to publish a notice
of the Authority's intent to issue its General Obligation Bonds, subjecting the bond issue to a
referendum election if a protest petition is signed by not less than 20% of the qualified electors
of the city and filed within 15 days of the published notice.
Staff recommends Option #1
Attachments: City of Salina Ordinance No. 23-11147
Salina Airport Authority Resolution No. 23-04
ORDINANCE NUMBER 23-11147
AN ORDINANCE UNCONDITIONALLY APPROVING THE ISSUANCE OF
GENERAL OBLIGATION BONDS BY THE SALINA AIRPORT AUTHORITY
FOR THE PURPOSE OF FINANCING THE COST OF CERTAIN CAPITAL
IMPROVEMENTS LOCATED AT THE SALINA REGIONAL AIRPORT AND
AIRPORT INDUSTRIAL CENTER.
WHEREAS, on March 15, 2023, the Board of Directors of the Salina Airport Authority (the
"Authority") adopted a resolution (the "Authority Resolution") conditionally, approving the issuance of
$10,235,000 (exclusive of costs of issuance and any temporary financing costs)"general obligation bonds
of the Authority to pay a portion of the costs the cost of certain capital improvements located at the Salina
Regional Airport and Airport Industrial Center, including, but not limrq N,1-
The
,�
The design and construction of General Aviation.'
viation Hangars at the e timated total
cost of $3,005,856 (the "General Aviation Hangar Project")
The design and construction of improvements to Hangar 626 to house aircraft
modification, maintenance, repair and overhaul operations at the estimated,total
cost of $6,174,608 (the "Hangar 626`MROProlect")'
The design and construction of an above ground aviation fuel facility and all
improvements related thereto at an estimated totaliGost of $8,481,108 (the "Fuel
Facility Project" and together.�with the General AVlitrotr Hangar Project and
Hangar 626 MRO Project, the:"Projects")
as authorized by K.S.A. 27-315 to 27-326,
WHEREAS, the
shall be as follows:
WHEREAS, K.S.E
the Mayor `of the City, who
or disabnr'OVal.a .'
SO N,
OF SALINA,
>t',of the Projects Paid for by general obligation bonds of the Authority
:Proiect Amount
1 Aviation Hamar Project $2,015,000
igat 626 MRb Prpject 5,570,000
ue1F,acility Project 2,650,000
23 provides that the Authority shall forward a copy of such resolution to
resentsuch resolution of the governing body of the City for its approval
BE IT ORDAINED BY THE GOVERNING BODY OF THE CITY
Section 1. The Authority Resolution providing for the issuance of not to exceed $10,235,000
(exclusive of costs of issuance and any temporary financing costs) of general obligation bonds of the
Authority for the purpose of financing a portion of the costs of the Projects as set forth herein is hereby
unconditionally approved.
Section 2. That this ordinance shall be in full force and effect from and after its adoption and
publication once, or publication of a summary thereof, in the official city newspaper.
600597.20047\ORDINANCE (SALINA AIRPORT AUTHORITY - MRO & FUEL FACILITY PROJECTS)
PASSED by the commission the 3rd day of April, 2023, and APPROVED by the Mayor.
[Seal]
A -1 CT.
JoV(
Introduced: March 27, 2023
Passed: April 3, 2023
Michael L. Hoppock, Mayor
600597.20047\ORDINANCE (SALINA AIRPORT AUTHORITY - MRO & FUEL FACILITY PROJECTS)
RESOLUTION NO. 23-04
A RESOLUTION PROVIDING STATUTORY AUTHORITY FOR THE
ISSUANCE OF GENERAL OBLIGATION BONDS OF THE SALINA AIRPORT
AUTHORITY FOR THE PURPOSE OF FINANCING THE COST OF CERTAIN
CAPITAL IMPROVEMENTS AT THE SALINA REGIONAL AIRPORT
WHEREAS, the SalinaAirport Authority (Salina, Kansas) (the "Authority") is a legally constituted
public airport authority, duly created, organized and existing under the Constitution and laws of the State,
including specifically K.S.A 27-315 to 27-236 et seq. (the "Act"); and
WHEREAS, the Board of Directors of the Authority (the "Governing Body") has considered the
need for certain internal improvements and has previously adopted the following resolutions (collectively
the "Prior Resolutions") providing for the issuance of general obligation bonds to finance the improvements
described in the Prior Resolutions and generally described herein:
Resolution No. 22-02 (Hangar 606 and 626 MRO Projects)
Resolution No. 21-08 (General Aviation Hangar, Air Terminal Concourse and Building
595 Projects)
Resolution No. 20-04 (Land Acquisition)
WHEREAS, the Authority has issued the following series of Temporary Notes to provide interim
financing for certain of the projects described in the Prior Resolutions (the "Outstanding Notes"):
WHEREAS, the Governing Body has identified a need to authorize additional general obligation
bonding authority for the General Aviation Hangar Project previously authorized by Resolution No. 21-08
at an estimated total cost of $3,005,856; and
WHEREAS, the Governing Body has identified a need to make additional improvements to the
Hangar 626 MRO Project previously authorized by Resolution No. 22-02 at an estimated total cost of
$6,174,608; and
WHEREAS, the Governing Body has identified a need to construct an above -ground aviation fuel
facility (the "Fuel Facility Project"), which project includes decommissioning the existing fuel facility and
installation of a new fueling system and supporting access road and all other improvements necessary and
related thereto at an estimated total cost of $8,481,108; and
WHEREAS, the Governing Body finds and determines that it is necessary and advisable to
authorize the issuance of general obligation bonds of the Authority to provide funds to pay a portion of total
estimated costs of the General Aviation Hangar Project, the Hangar 626 MRO Project, and the Fuel Facility
Project.
600597.20447 - PROJECT AUTHORIZATION RESOLUTION - SERIES 2023 BONDS
Dated
Maturity
Original
Outstanding
Series
Date
Date
Amount
Amount
2020
09/01/2020
09/01/2023
$2,100,000
$2,100,000
2021-1
11/10/2021
09/01/2023
3,545,000
3,545,000
2022-1
07/01/2022
07/01/2023
1,000,000
1,000,000
WHEREAS, the Governing Body has identified a need to authorize additional general obligation
bonding authority for the General Aviation Hangar Project previously authorized by Resolution No. 21-08
at an estimated total cost of $3,005,856; and
WHEREAS, the Governing Body has identified a need to make additional improvements to the
Hangar 626 MRO Project previously authorized by Resolution No. 22-02 at an estimated total cost of
$6,174,608; and
WHEREAS, the Governing Body has identified a need to construct an above -ground aviation fuel
facility (the "Fuel Facility Project"), which project includes decommissioning the existing fuel facility and
installation of a new fueling system and supporting access road and all other improvements necessary and
related thereto at an estimated total cost of $8,481,108; and
WHEREAS, the Governing Body finds and determines that it is necessary and advisable to
authorize the issuance of general obligation bonds of the Authority to provide funds to pay a portion of total
estimated costs of the General Aviation Hangar Project, the Hangar 626 MRO Project, and the Fuel Facility
Project.
600597.20447 - PROJECT AUTHORIZATION RESOLUTION - SERIES 2023 BONDS
THEREFORE, BE IT RESOLVED BY THE BOARD OF DIRECTORS OF THE SALINA
AIRPORT AUTHORITY AS FOLLOWS:
Section 1. Project Authorization. The General Aviation Hangar Project and Hangar 626
MRO Projects are hereby re -authorized. The Fuel Facility Project is hereby authorized.
Section 2. Bond Authorization. The issuance of general obligation bonds of the Authority
under the Act (the "Bonds") to pay (i) a $2,015,000 portion of the costs of the General Aviation Hangar
Project; (ii) a $5,570,000 portion of the costs of the Hangar 626 MRO Project; and (iii) a $2,650,000 portion
of Fuel Facility Project and associated financing costs is hereby conditionally authorized, subject to further
resolution of the Authority, which resolution shall also provide for the issuance of the Bonds to permanently
finance the other projects authorized in the Prior Resolutions and provide for the retirement of the
Outstanding Notes. The authority for the issuance of general obligation bonds of the Authority herein shall
be in addition to the authority set forth in the Prior Resolutions.
Section 3. Reimbursement. To the extent applicable, the proceeds of the Bonds may
reimburse expenditures of the Authority for the projects described herein made on or after the date which
is 60 days before the date of this Resolution, pursuant to Treasury Regulation § 1.150-2.
Section 4. Further Actions. The Executive Director, the Director of Administration and
Finance, Stifel, Nicolaus & Company, the Authority's Financial Advisor and Gilmore & Bell, P.C., the
Authority's Bond Counsel, are hereby authorized and directed to take such other action as may be necessary
to carry out the intent of this Resolution, including providing for the redemption of the Outstanding Notes.
Section 5. Effectiveness. This Resolution shall take effect immediately upon its adoption.
600597.20447 - PROJECT AUTHORIZATION RESOLUTION - SERIES 2023 BONDS
ADOPTED by the governing body of the Authority on March 15, 2023,
SALINA AIRPORT AUTHORITY
(SEAL)
ATTEST:
By: 1.. .
Name: Kasey Pindhorst
Board Clerk
600597.20447 -PROJECT AUTHORIZATION RESOLUTION - SERIES 2023 BONDS