Audit Report - 2003
COMPREHENSIVE ANNUAL FINANCIAL REPORT
of the
SALINA AIRPORT AUTHORITY
A Component Unit of the
City of Salina, Kansas
For the Fiscal Year Ended December 31, 2003
Prepared by the Management
of the
Salina Airport Authority
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TABLE OF CONTENTS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
F or the Fiscal Year Ended December 31, 2003
Page
INTRODUCTORY SECTION
Letter of Transmittal ...................................................................................... ... 1-6
Principal Officers .....................................................................................".... .... 8
Authority Staff Members............... .................... ........... .........." ....... ........ ".... .. .. 9
Organizational Chart ................................................................................".... .. .. 10
Certificate of Achievement ........................................................................... .. .. 11
Salina Municipal Airport Aerial View.......................................................... .. .. 12
FINANCIAL SECTION
Independent Auditors' Report ....................................... ........"....... ....... ........ 13-14
Management's Di scussi on and Anal ysis ......................................... 15 - 21
Statements of Net Assets.............................................................................. 22-23
Statements of Revenues, Expenses and
Changes in Net Assets........................................................................... .. .. 24
Statements of Cash Flows (Direct Method) ............................................... 25-26
Notes to Financial Statements................. ..,....... ............."..... ....". .............. 27-39
Supplemental Information
Schedules of Revenues, Expenses and Changes in Net Assets.................. 42-43
Capital Expenditures.................................................................................... 44-45
General Obligation Bonds - Series 1998-A ............................................... .. .. 46
General Obligation Refunding Bonds - Series 1999-B.............................. .. .. 47
General Obligation Improvement Bonds - Series 2001-A......................... .. .. 48
General Obligation Improvement Bonds - Series 2002-A......................... .. .. 49
Leasehold Revenue Bonds - Series 1991................................................... .. .. 50
KDOCH Loan Payable............................................................................... .. .. 51
Special Assessment Debt-Street and Utility Improvement........................ .. .. 52
Insurance in Force ...................................................................................... .. .. 53
ST A TISTICAL SECTION
Operating Revenue History........................................................................... .. ..55
Operating Expense History ........................................................................... .. .. 56
Federal Financial Assistance History............................................................ .. .. 57
Capital Expenditure History.......................................................................... .. .. 58
Revenue Bond Coverage............................................................................... .. ..59
Principal Customers ....................................................................................., .. ..60
Local Government Mill Levy Rates, Direct & Overlapping ........".............. .. .. 61
Mill Levy Revenue................................................................................."..... .. ..62
Air Traffic, Fuel Flowage, and Enplanement Trends ................................... .. .. 63
Major Employers......................................................................,.................... .. ..64
Saline County Population, Demographic and Labor Statistics .............."..... .. .. 65
Saline County Employment Data.................................................................. .. .. 66
OTHER INDEPENDENT AUDITORS' REPORTS
Report on Compliance and on Internal Control
Over Financial Reporting Based on an Audit of Financial Statements
Performed in Accordance with Government Auditing Standards........ 67-68
Report on Compliance with Requirements Applicable to
Each Major Program and Internal Control Over Compliance
In Accordance with OMB Circular A-133 ..........................................69-70
Schedule of Expenditures of Federal Awards ............................................... .... 71
Notes to Schedule of Expenditures of Federal Awards ............................... ....72
Summary Schedule of Prior Audit Findings ................................................ ....73
Schedule of Findings and Questioned Costs ................................................ ....74
Corrective Action Plan............................................. ......."....... ....... ...... .."... ....75
ii
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On June 30, 2003 the Salina Authority commissioned
a new 4,300 foot Runway at the Salina Municipal Airport
(SLN). Runway 18/36 was designed to improve safety
reduce delays at SLN. Aircraft operations for 2003 totaled
86,21 making Salina's Contract Tower Program
facility the busiest VFR control tower in Kansas.
SALINAAirport
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Chairman
Robert H. Miller
Vice-Chairman
Dr. Randy D. Hassler
Secretary
Stephen C. Ryan
Treasurer
John K. Vanier, II
Past Chairman
Donald E. Morris
Executive Director Timothy F. Rogers, A.A.E. Mar. of Administration and Finance Michelle R. Swanson Mar. of Operations, Maintenance and ARFF Ryan E. Rocha
Board Attorney Greg A. Bengtson
June 16, 2004
Salina Airport Authority Board of Directors
3237 AmoldAve.
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, 2003 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 2003 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, that it is presented in a manner designed to fairly set forth the fiscal position and results
of the operation of the Authority as measured by its financial activity, and that all disclosures necessary
to enable the reader to gain maximum understanding are included in the report.
This CAFR is presented in accordance with generally accepted accounting principles (GAAP) and
pursuant to K.S.A. 27-324, an audit of the books, accounts and financial statements has been completed
by the Authority's independent certified public accountants, Clubine and Rettele, Chartered. The
independent audit is in accordance with the Kansas Municipal Audit Guide, the Government Auditing
Standards issued by the Comptroller General of the United States, and the provisions of the Office of
Management and Budget Circular A-133, "Audits of States, Local Governments and Nonprofit
Organizations" .
GAAP requires that management provide an overview an analysis to accompany the financial statements
in the form of a Management Discussion and Analysis (MD&A). It is recommended that this letter of
transmittal be read in conjunction with the MD&A which can be found immediately following the report
of the independent auditor in the Financial Section of this report.
ORGANIZATION OF THE REPORT
The Authority applies the standards for preparation of local government fmancial reports recommended
by the Government Finance Officers of the United States and Canada (GFOA). The Authority's 2003
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
2002, and an aerial photo of the Salina Municipal Airport and Airport Industrial Center.
- s~M~~ 3237 Arnold 1 Salina, KS 67401-8190/785.827.39141 Fax: 785.827.2221 sAL!J,I~ft!lJ~J!!
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TRODUCTORY
Financial Section - includes the independent auditors' report, Management's
Discussion and Analysis (MD&A), the Authority's 2003 financial statements and the
required supplemental information.
Statistical Section - includes selected fmancial and demographic information, which
highlights economic and demographic trends.
Other Indeoendent Auditors' Reoorts Section - includes reports concerning the
Authority's compliance and internal control over financial reporting and compliance and
internal control over compliance with requirements applicable to administering federal
awards programs.
REPORTING ENTITY
The Salina Airport Authority is a body corporate and politic. The Authority was created by the City of
Salina in April 1965 (Sec. 4-16, Salina City Code) pursuant to the authority granted by the City by the
surplus property and public airport authority act of the State of Kansas (K.S.A. 27-315 et seq.) The
Authority was created for the purpose of accepting as surplus property portions of thc~ 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 eleven 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 Kansas State University - Salina College of Technology and Aviation (KSUS).
The campus of KSUS is located adjacent to the airport. The college offers degrees in professional flight
training, airframe and power plant maintenance, and avionics technology.
The Salina Airport Industrial Center is home for 76 businesses and organizations. Forty-three of the
businesses and organizations are tenants of the Authority. One of the primary functions of the Authority
is to facilitate the continued growth of jobs and payroll at the Airport Industrial Cente:r. 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.
2
INTR
lDUCTORY
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 manufacturing, transportation, [mance, real estate,
insurance, services and retail trade, confirm Salina's position as one of Kansas' strongest regional
economic centers.
According to the April 2004 Strength Index report published by K-State Research and Extension
Department of Agricultural Economics, Saline County ranked fifth out of the 105 counties in "strength
index" for 2002-2003. The index is a measure of economic prosperity in Kansas counti~:s, and is made
up of three components including wealth, personal income and employment indices. The: strength index
is determined not only by compiling the key economic indicators in each county, but also comparing
those measures against the state's per capita economic progress. A county with a score of 1.0 for all
three indices would perfectly reflect the values for the State of Kansas and have a Strength Index of
3.00. Saline County's score of 3.07 indicates that it is prospering at a greater rate than the entire state
The Bureau of the Census, the Kansas Department of Revenue, the Kansas Department of Human
Resources, the Kansas Governor's Economic and Demographic Report, and K-State Research and
Extension comprise the source for the strength index data.
Economic Condition of the Airport and Airport Industrial Center
As of December 31, 2003, over 70 businesses and organizations at the Airport Industrial Center
employed an estimated 4,600 employees. Total payroll was an estimated $121 million.
Future Economic Outlook
The future economic outlook for both Salina and the Authority continues to look favorable. Continued
growth in service, retail and manufacturing sectors is expected. The Salina Area Chamber of Commerce
forecasts that approximately 700 new jobs per year will be added to the economy ove:r the next five
years. Airport Industrial Center businesses and organizations such as Schwan's Food Manufacturing,
Inc., Salina Vortex Corporation, Aerospace Systems and Technologies, Inc., Flower Aviation, and the
Kansas State University-Salina College of Technology and Aviation continue to work on facility
expansion plans. These expansions will result in additional jobs and payroll.
INITIATIVES AND D EVELO PMENT
Salina Municipal Airport
On June 30, 2003, a new, locally funded $1.4 million runway opened at the Salina Municipal Airport.
The 4,300 ft. runway designated Rwy 18/36 runs parallel to the airport's primary runway and was
financed with SAA issued General Obligation bonds making it one of the country's few new runways
paid for without using federal dollars. Rwy 18/36 was built to better accommodate the growth of aircraft
traffic ITom the Kansas State University - Salina College of Technology and Aviation, in addition to
military training and flight-tests ITom Wichita aircraft manufacturers. In addition, the new parallel
general aviation runway will relieve congestion on the airport's primary runway and reduce delays for
3
TRODUCTORY
the itinerate traffic using Salina as a mid-continent refueling stop. The project was completed in less
than 12 months from the date the engineering contract was signed.
The year ending December 31, 2003, marked the fourth consecutive year that fuel sales on the airport
exceeded the 4 million gallon level. The airport's two Fixed Base Operators (FBO), America Jet and
Flower Aviation continue to provide top-notch service and the top selling aviation fuel brands to the
wide variety of aircraft that utilize the Salina Municipal Airport including general aviation, air carrier,
and military. Because of Salina's geographic location, the Salina Municipal Airport is a popular mid-
continent refueling stop. Fuel sales are an important component to the operation of the Airport as the
fuel flowage fee revenue generated over 20% of the Authority's 2003 operating revenue.
The Salina Municipal Airport was the first airport in Kansas to comply with the requirements of the
newly formed Transportation Security Administration (TSA). In November 2003 the TSA completed its
first full year of federalized airport security screening at Salina.
During 2003, the Authority worked with Mesa Air Group to reduce air fares out of Salina and provide a
reasonable Salina to Kansas City fare allowing Salina area passengers the opportunity to connect with
air carriers such as Southwest. The efforts included an Air Service Development Questionnaire that
surveyed Salina area businesses and organizations regarding their travel tendencies. On October 9,
2003, Mesa announced that it was reducing fares by as much as 40% for service from the Salina
Municipal Airport to the Kansas City International Airport.
Salina Airport Industrial Center
During 2003, the Authority continued to make improvements to Airport Industrial Center facilities
through the utilization of the funds provided with the 2001 Facility Improvement General Obligation
Bond issue. I.) Two new parking lots were constructed at the Bostater Realty Airport Apartments and
a lease addendum generating additional airport revenue was finalized; 2.) The improvements to the
vacant manufacturing facility at 3600 Airport Road were completed; and 3.) The d~molition of three
large former USAF structures was completed.
The Authority was pleased with its involvement in bringing Turbine Specialties/Cooper Cameron to the
Airport Industrial Center. With Turbine's purchase of a vacant manufacturing facility, the existing
Turbine jobs will stay in Salina and additional jobs will be created as they consolidate operations.
Capital Financial Plannim!
Throughout the year, the Authority staff worked on the development of a five-year capital
improvement program. All projects included in the plan are designed to meet the objectives as set
forth in the Airport's 1991 Master Plan. A significant portion of the funding for the capital
improvement projects will come from the Authority's entitlement dollars under the Federal Aviation
Administration's (FAA) Airport Improvement Program. It is anticipated that the Federal share of the
identified projects range from 85% to 95% of the total project development cost. All projects under
this five-year capital improvement program are subject to FAA review and approval. In August 2003,
the SAA received a FAA grant offer in the amount of $2,416,016 to fund 87% of the cost to
rehabilitate the airports primary Runway 17/35 during 2004.
4
INTR
IDUCTORY
FINANCIAL CONTROLS
The Authority follows generally accepted accounting principles applicable to gov~:rnmental 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 ITom loss, theft, or misuse and
to ensure that adequate accounting data is compiled to allow for the preparation of finan,cial 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: (I) the cost of a control should not exceed the benefits likely to be
derived; and (2) the valuation of costs and benefits requires estimates and judgments by management.
An annual budget is prepared in accordance with the Authority's By-laws. However, the Authority is
specifically exempt ITom the budget laws of the State of Kansas (K.S.A. 27-322) and the Authority is not
required to demonstrate statutory compliance with its annual operating budget. Accordingly, budgetary
data is not included in the accompanying financial statements.
CASH MANAGEMENT
All cash temporarily idle during 2003 was invested by the Executive Director of the Authority in short-
term investments to attain the highest possible return consistent with the Authority's liquidity needs. All
investments are in compliance with K.S.A. 12-1675 which controls the investment of public funds by
Kansas governmental units.
RISK MANAGEMENT
The Authority is exposed to risks of loss associated with the operation of a public use airport and the
operation of an airport industrial center. To handle the associated risks of loss, the Authority uses
available tort liability legislation and purchases the appropriate types of insurance coverage. It is the
policy of the Authority to eliminate or transfer risk ofloss where possible.
The Kansas Tort Claims Act (K.S.A. 75-6101 et seq.) generally limits tort liability for Kansas
governmental entities. The maximum liability for claims as specified by the Act is $500,000 for any
number of claims arising out of a single occurrence or accident. For wrongful acts, Kansas
governmental entities or their employees are exempted ITom liability.
The Authority carries $500,000 of comprehensive general liability insurance which matches the limit
established by the Kansas Tort Claims Act. During 2003 the Authority carried $12,455,674 of insurance
on airport commercial properties. The Authority also acquires construction builders' risk policies for all
major construction projects or requires evidence of coverage ITom the contractor.
The Authority's commercial property insurance included $1,123,878 in loss of rents (;overage. All
contractors and lessees are required to carry amounts of property insurance with limits and deductibles
approved by the Authority. A schedule of insurance in force at December 31, 2003 is included in the
Supplemental Section of this report.
5
TRODUCTORY
In addition, the Authority uses various risk management techniques. All contracts and leases are
reviewed by the Authority's legal counsel. All contractors and subcontractors are required to submit
evidence of insurance coverage naming the Salina Airport Authority and the City of Salina as named
additional insured.
GFOA CERTIFICATE OF ACHIEVEMENT
The Govemment 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 fmancial report (CAFR) for the fiscal year ended December 31, 2002. This was
the eleventh consecutive year that the Salina Airport Authority has achieved this prestigious award. In
order to be awarded a Certificate of Achievement, a government unit must publish an easily readable
and efficiently organized comprehensive annual financial report (CAFR). This reporlt 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 believle that 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.
ACKNOWLEDGEMENTS
The support of the Authority's Board of Directors has been instrumental in the preparation of this report.
The Board has been actively involved in the preparation and review of this report and is committed to
responsible and progressive financial reporting.
Also acknowledged is the assistance of the Authority's auditor, Clubine and Rettele, Chartered, the
Authority's accounting advisors, Harrison & Arnett, Chartered, 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,
T2~1~
Executive Director
Salina Airport Authority
l{f~ tf.~
Michelle R. Swanson
Manager of Administration and Finance
Salina Airport Authority
cc:
The City of Salina Board of Commissioners
6
(THIS PAGE INTENTIONALL Y LEFT BLANK)
7
SALINA AIRPORT AUTHORITY
PRINCIPAl, OFFICRRS AS OF ORCRMRRR J1 200J
BOARD OF DIRECTORS
Donald E. Morris
Robert H. Miller
Dr. Randy D. Hassler
Stephan C. Ryan
John K. Vanier, II
Chairman
Vice-Chairman
Secretary
Treasurer
Past Chairman
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
Leslie M. Corbett, c.P.A.
Clubine & Rettele, Chartered
Salina, Kansas
8
SALINA AIRPORT AUTHORITY
A IJTHORTTY ST A FF MF,MRRRS
9~ of J)ecemher 11 200J
ADMINISTRATION STAFF
Timothy F. Rogers, A.A.E.
Ryan E. Rocha
Michelle R. Swanson
Donald C. Kneubuhl
Cathy Lentz
Executive Director
Manager of Operations, Maintenance & ARFF
Manager of Administration & Finance;:
Manager of Special Projects
Administrative Assistant
OPERATIONS, MAINTENANCE, AIRCRAFT RESCUE & FIRE FIGHTING STAFF
Loren Carleton
Kim Colby
Gary Hansen
Dale Mattison
David Nease
Rob Pejsha
Jason Pinnick
Operations, Maintenance & ARFF
Operations, Maintenance & ARFF
Operations, Maintenance & ARFF
Operations, Maintenance & ARFF
Operations, Maintenance & ARFF
Operations, Maintenance & ARFF
Operations, Maintenance & ARFF
9
SALINA AIRPORT AUTHORITY
Organizational Chart
December 31,2003
SAA BOARD OF DIRECTORS
John K. Vanier, II 3/1/99 - 2/28/05
Donald E. Morris 3/1/00 - 2/28/06
Robert H. Miller 3/1/01 - 2/28/04
Dr. Randy D. Hassler 3/1/02 - 2/28/05
Stephan C. Ryan 3/1/03 - 2/28/06
MANAGER OF ADMINISTRATION & FINANCE
Michelle R. Swanson
MANAGER OF SPECIAL PROJECTS
Donald C. Kneubuhl
MANAGER OF OPERATIONS, MAINTENANCE & ARFF
Ryan E. Rocha
-I
a
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, 2002
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 fmancial reporting.
~#
President
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Executive Director
11
L Airport
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January 2004
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12
CTIO
Mesa Air Group's subsidiary, Midwest, lowered fares
from the Salina Municipal Airport to the Kansas City
International Airport by as much as 40% during October
2003. The airline operates as US Airways Express with
three-daily flights to Kansas City enabling area travelers to
make multiple airline connections destinations throughout
the world.
CLUBlNE&
RETIELE
CHARfERED
Certified Public Accountants
fill
Robert I. Clubine, C.PA
David A. Rettele, C.PA
Jay D. Langley, C.PA
Jon K. Bell, C.PA
Leslie M. Corbett, C.PA
Stacy J. Osner, C.PA
Marci K. Fox, C.PA
Valerie K. Linenberger, C.PA
Delores K. Longenecker, C.PA
John T. Millikin, C.P.A.
Linda A. Suelter, C.P.A.
218 South Santa Fe
P.O. Box 2267
Salina, Kansas
67402-2267
Salina
785 / 825-5479
Salina Fax
785 / 825-2446
Ellsworth
785/472-3915
Ellsworth Fax
785/472-5478
INDEPENDENT AUDITORS' REPORT
To the Board of Directors
Salina Airport Authority
We have audited the accompanying basic financial statements of Salina Airport
Authority, a component unit of the City of Salina, Kansas, as of and for the years
ended December 31, 2003 and 2002, 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 audits in accordance with auditing standards generally accepted
in the United States of America and the standards applicable to financial audits
contained in Government Auditing Standards, issued by the Comptroller General of
the United States and the Kansas Municipal Audit Guide, prescribed by the
Director of Accounts and Reports, Department of Administration of the State of
Kansas. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our 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, 2003 and 2002, and the changes in its financial position and its cash
flows for the years then ended in conformity with accounting principles generally
accepted in the United States of America.
As described in Note IB, the Authority has implemented a new financial reporting
model, as required by the provisions of GASB Statement No. 34, Basic Financial
Statements - and Management's Discussion and Analysis - for State and Local
Governments, as of December 31, 2003.
The management's discussion and analysis on pages 15 through 21 is not a required
part of the basic financial statements but is supplementary information required by
accounting principles generally accepted in the United States of America. We have
applied certain limited procedures, which consisted principally of inquiries of
management regarding the methods of measurement and presentation of the
required supplementary information. However, we did not audit the information
and express no opinion on it.
13
In accordance with Government Auditing Standards, we have also issued our report dated April 30,2004, 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. That report is an integral part of
an audit performed in accordance with Government Auditing Standards and should be read in conjunction
with this report in considering the results of our audit.
Our audit was performed for the purpose of forming an opinion on the financial statements taken as a whole.
The accompanying schedules and additional information listed in the supplemental information of the
Financial Section and the Statistical Section of the table of contents are presented for purposes of additional
analysis and are not a required part of the financial statements. The accompanying schedule of expenditures
of federal awards is presented for purposes of additional analysis as required by u.s. Office of Management
and Budget Circular A-133, Audits of States, Local Governments, and Non-Profit Organizations, and is not a
required part of the financial statements. Such information, except for the Statistical Section as listed in the
table of contents on which we express no opinion, has been subjected to the auditing procedures applied in the
audit ofthe financial statements and, in our opinion, is fairly stated in all material respects in relation to the
financial statements taken as a whole.
CL UB INE AND RETTELE, CHARTERED
~~~
April 30, 2004
14
FINANCIAL
MANAGEMENT'S DISCUSSION AND ANALYSIS
The Management of the Salina Airport Authority offers the readers of the Authority's financial statements
this narrative overview and analysis of the financial activities of the Salina Airport Authority for the fiscal
year ended December 31, 2003. We highly encourage readers to consider the information presented here
in conjunction with the information offered in the letter of transmittal within the Introductory Section of
this report.
AIRPORT ACTIVITY AND HIGHLIGHTS
The Salina Air Traffic Control Tower (ATCT) ended 2003 having handled 86,214 aircraft operations.
Although total operations were down from 2002, which was the highest year for the most recent 10-year
period, the itinerant traffic categories of operations continue to remain strong. The: most significant
reduction in operations fell in the military category. The biggest percentage decrease (46%) was in the
category of local military training flights, which reconciles with the fact that certain units that use Salina
for training flights were deployed outside of the United States during 2003. Salina continues to remain
strong as a mid-continent refueling stop as is evident in the number of gallons of aviation fuel delivered by
the two tenants of the Authority specializing in the sale of aviation fuel.
The commercial airline industry continues to experience financial stress, especially for the carriers
attempting to serve rural communities such as Salina. For the first time in history the Salina Municipal
Airport became a player in the Department of Transportation (DOT) Essential Air Service Program. This
event was trigged when Salina's air carrier, Air Midwest, filed its 90-day notice to terminate service in
January 2002 after a decline in passenger emplacements beginning in 2001. This lead to the DOT issuing
the order prohibiting Air Midwest from suspending service at Salina for 30 days beyond the end of its 90-
day notice period and requesting proposals from carriers interested in providing replaœment service at
Salina. On December 8, 2003, Mesa Air Group on behalf of its subsidiary, Air Midwest submitted a
proposal to provide Essential Air Service (EAS) at Salina at the current level of thrc~e daily weekday
flights and multiple weekend flights. At the end of 2003, Air Midwest continued to provide service at
Salina operating under hold-in orders from DOT. The changes in the Authority's major airport activity
indicators for the past three years are as follows:
2003 2002 2001
Enplanements - Scheduled Air Carrier 2,242 2,565 6,507
% increase / (decrease) -12.6% -153.7% -36.6%
Aircraft Operations - All Categories 86,214 95,801 92,870
% increase / (decrease) -10.0% 3.1% 5.9%
Fuel Flowage - (gallons delivered) 4,358,563 4,695,093 4,396,429
% increase / (decrease) -7.2% 6.4% -1. 7%
Further airport activity data can be found in the Statistical Section of this report.
15
FINANCIAL
AIRPORT INDUSTRIAL CENTER ACTIVITY AND HIGHLIGHTS
The Authority owns 838,748 sq. ft. of leasable manufacturing, warehouse and office space at the Airport
Industrial Center. As further described herein, the building revenue generated by the Authority's leasing
activity constitutes a significant portion of the annual operating revenue budget. During 2003, building
rents equaled 45.6 % or $632,787 of operating revenue. At the end of 2003, the Authority had only two
vacant facilities, representing 4,011 sq. ft. of commercial office space and 66,926 sq. ft. of combined
office and manufacturing space, in its available leasing inventory. This constitutes a 92% occupancy rate.
SUMMARY OF OPERATIONS AND CHANGES IN NET ASSETS
Even with the uncertainty in the aviation industry and the slow growth in the economy, the [mancial
condition of the Authority has held steady in recent years. The Authority has effectively dealt with major
cost increases in employee health benefits including medical insurance prerniwns, utility costs,
commercial property insurance premiums and other operating expenses. Fortunately, with the diversified
revenue base, including building and land rental from the Authority's Industrial Center, total operating
revenue increased from 2002 to 2003. The Authority also instituted a new fee schedule:, which went into
effect January 1,2003.
Operating Revenues
Operating Expenses
2003
$ 1,387,297
(1,300,268)
2002
$ 1,387,079
(1,182,264)
Excess before Depreciation
and other non-operating
income and expenses
87,029
204,815
Depreciation
(1,022,474)
(974,140)
Excess (loss) before
other non-operating
income and expenses
(935,445)
(769,325)
Other Non-Operating Income
and (Expenses) net
772.257
646,095
Loss before
Capital Contributions
(163,188) (123,230)
434,763 144,005
$ 271,575 $ 20,775
Capital Contributions
Increase in Net Assets
16
FINANCIAL
SUMMARY OF OPERATIONS HIGHLIGHTS
Significant items effecting the Summary of Operations and Changes in Net Assets for 2003 are as follows:
.
Operating revenues remained steady at $1.387 million for both 2002 and 2003. While airfield and
terminal building commission revenues decreased, building, commercial land and agri-land
income increased due to consumer price index increases on existing lease agreements and new
rental agreements negotiated.
Operating expenses increased by 10% due to the following:
0 Increases in maintenance salaries and employee benefits as a result of a significant
amount of overtime incurred during the construction of the Authority's new parallel
runway during the summer of2003. The Authority was able to decrease the capital outlay
required for the construction of the runway by painting and striping thc~ new runway in-
house.
0 The Authority's health insurance premium rates were raised twice during 2003 increasing
the cost of this employee benefit by 17% over the 2002 expense.
0 Utility costs and snow removal expense increased due to the colder winter and increased
snow removal operations.
.
.
The net result of the above was operating income before depreciation decreased by $117,786 fÌ'om
2002. Depreciation expense increased due to new construction moving fÌ'om construction in
progress to an asset in service. The significant items being the two new snowplows acquired with
95% grant funds and the Authority's new parallel runway.
Non-operating income and (expenses) increased by 19.5% as a result of the increase in ad-
valorem tax revenue (mill levy) received by the Authority as a local taxing I:;:ntity. Mill levy
revenue increased by $170,471 fÌ'om 2002.
Capital contributions received in the form of grants from the Federal Aviation Administration
increased fÌ'om 2002 by $290,758. This was a result of the new snowplows being delivered in
early 2003 and grant funding received.
.
.
17
FINANCIAL
FINANCIAL POSITION SUMMARY
The changes in net assets may serve over time as a useful indicator of a government's financial position.
The Authority's assets exceeded liabilities by $20,030,048 at the close of2003. A condensed summary of
the Authority's total net assets at December 31 is shown below.
2003
2002
ASSETS
Current and other assets
Capital assets
Total assets
$ 3,676,007
24,954,889
28,630,896
$ 5,701,810
23,700,563
29,402,373
LIABILITIES
Long-term debt outstanding
Other liabilities
Total liabilities
6,246,510
2,354,338
8,600,848
7,235,433
2,408,467
9,643,900
NET ASSETS:
Invested in capital assets,
net of related debt
Restricted
Unrestricted
17,711,718 15,418,378
85,000 85,000
2,233,330 4,255,095
$20,030,048 $19,758,473
TOTAL NET ASSETS
By far the largest portion of the Authority's net assets (88%) reflects its investment in capital assets
including land, buildings, airfield infrastructure and machinery and equipment, less any related debt used
to acquire those assets that is still outstanding. The Authority uses these capital assets to provide services
to citizens; consequently, these assets are not available for future spending. Although the Authority's
investment in its capital assets is reported net of related debt, it should be noted that the resources needed
to repay this debt must be provided from other sources, since the capital assets themselves cannot be used
to liquidate these liabilities.
18
FINANCIAL
REVENUES
The following chart shows the major sources and the percentage of total operating revc~nues for the year
ended December 31, 2003:
Building and Ian
rent
66%
Other revenue
2%
A summary of revenues ITom the year ended December 31, 2003 and the amount and percentage of
change in relation to prior year amounts is as follows:
Increase Percent
Percent (Decrease) Increase
2003 Amount of Total from 2002 (Decrease)
Operating Revenue:
Airfield $ 447,842 17.9% $ (7,048) -1.5%
Building and land rent 916,585 36.6% 53,024 6.1%
Gain (loss) on sale of assets .(6,631) -0.3% (36,086) -122.5%
Other revenue 29,501 1.2% (9,672) -24.7%
Total Operating 1,387,297 55.4% 218 0%
Non-Operating Income:
Mill Levy 987,970 39.5% 170,471 2Jl%
Interest Income 128,640 5.1% (19,123) -13%
Total Non-Operating 1,116,610 44.6% 151,348 16%
TOTAL REVENUES $ 2,503,907 100.0% $ 151,566 6%
Further detail regarding the Authority's operating revenue can be found in the Supplemental Section of
this report.
19
FINANCIAL
EXPENSES
The following chart shows the major expense categories and the percentage of total operating expenses for
the year ended December 31, 2003
Maintenance
37%
Administrati()n
63%
A summary of expenses for the year ended December 31, 2003 and the amount and percentage of change
in relation to prior year amounts is as follows:
Percent Increase Percent
of (Decrease) Increase
2003 Amount Total from 2002 (Decrease)
Operating Expense
Administration $ 825,064 50.2% $ 73,330 9.8%
Maintenance 475,204 28.9% 44,674 10.4%
Total Operating 1,300,268 79.1% 118,004 10%
Non-Operating Expense
Interest Expense 324,500 19.7% 25,186 8%
Amortization of bond
costs 19,853 1.2% 0%
Total Non-
Operating 344,353 20.9% 25,186 8%
TOTAL EXPENSES $ 1,644,621 100.0% $ 143,190 10%
Further detail regarding the Authority's operating expenses can be found in the Supplemental Section of
this report.
20
FINANCIAL
CAPIT AL ACQUISITIONS AND CONSTRUCTION ACTIVITIES
The Authority expended $2,283,433 on capital activities during 2003. The most significant item was the
construction of the Airport's new parallel runway at a cost of$I,384,742. The second major item was the
acquisition of two new rollover snow plows at a cost of $400,374.
Capital asset acquisitions exceeding $1,000 are capitalized at cost and are depreciated! over their useful
lives, with the exception of land. The Authority's capital assets are financed using Federal and State
grants with matching Authority funds, debt issuance and Authority revenues. Additional information on
the Authority's capital assets can be found in Note III (F) in the notes to the financial statements and
within the Supplemental Section of this report.
DEBT ADMINISTRATION
The outstanding long-term debt of the Authority was $6,246,510 at December 31, 2003. This debt
consists of general obligation bonds, leasehold revenue bonds, a HUD Community Development Block
Grant loan and City of Salina special assessments. Maturities range from 2006 through 2016. Both
principal and interest are payable from, proceeds of a direct financing lease, the general revenues of the
Authority and mill levy revenue. The Authority issued no new debt during 2003. Details of the
Authority's debt can be found in Note III (E) - in the notes to the financial statements and within the
Supplemental Section.
REQUEST FOR INFORMATION
This comprehensive annual financial report is designed to provide detailed information on the Authority's
operations and the financial results of those operations to all those with an interest in the Authority's
financial affairs. Questions concerning any of the information provided in this report or request for
additional information should be addressed to the Manager of Administration and Finance bye-mail:
shellis(a~salair.org or in writing to, Salina Airport Authority, 3237 Arnold Ave., Salina, KS 67401.
Respectfull y sub~;1d,-
2dl~
Executive Director
\jr¿œIdú t.~
Michelle R. Swanson
Manager of Administration and Finance
21
FINANCIAL
SALINA AIRPORT AUTHORITY
STATEMENTS OF NET ASSETS
ASSETS
December 31
2003
2002
CURRENT ASSETS:
Cash
Accounts receivable
Prepaid expenses
Taxes receivable
$ 1,383,276
109,996
8,332
1,023,355
$ 3,386,102
80,591
4,315
977,990
Total Current Assets
2,524,959
4,448,998
RESTRICTED ASSETS:
Cash and cash equivalents
85,000 85,000
968,853 1,050,764
24,954,889 23,700,563
NET INVESTMENT IN FINANCING LEASE
NET INVESTMENT IN CAPITAL ASSETS
OTHER ASSETS:
Bond issue costs, less accumulated amortization
of$144,302 and $124,449 respectively
97,195
117,048
TOTAL ASSETS
$28,630,896
$29,402,373
( continued)
See notes to financial statements.
22
FINANCIAL
SALINA AIRPORT AUTHORITY
STATEMENTS OF NET ASSETS
( continued)
LIABILITIES AND NET ASSETS
December 31
2003
2002
CURRENT LIABILITIES:
Accounts payable-operations
Accounts payable-capital purchases
Accrued payroll and expenses
Accrued property tax
Accrued special assesments
Deferred tax revenue
Deferred maintenance agreement
Unearned rental income
Accrued interest payable
Unearned interest - financing lease
Current maturities of long-term debt
$ 14,120 $ 17,168
33,649 69,467
22,939 21,700
56,929 51,187
25,047 25,047
1,023,355 977,990
2,995 5,176
41,064 31,277
91,550 105,752
53,767 56,953
988,923 1,046,750
2,354,338 2,408,467
Total Current Liabilities
LONG-TERM LIABILITIES:
Bonds and note payable, less current maturities
6,246,510
7,235,433
Total Liabilities
8,600,848
9,643,900
NET ASSETS:
Invested in Capital Assets, net of Related Debt
Restricted, Bond Reserve Funds
Unrestricted
17,711,718 15,418,378
85,000 85,000
2,233,330 4,255,095
20,030,048 19,758,473
$28,630,896 $29,402,373
Total Net Assets
TOTAL LIABILITIES AND NET ASSETS
See notes to financial statements.
23
SALINA AIRPORT AUTHORITY
STATEMENTS OF REVENUES, EXPENSES
AND CHANGES IN NET ASSETS
FINANCIAL
January I to Dt~cember 31
2003 2002
OPERATING REVENUES:
Airfield
Building and land rent
Gain (loss) on sale of assets
Other revenue
$ 447,842
916,585
(6,631)
29,501
1,387,297
825,064
475,204
1,300,268
87,029
1,022,474
(935,445)
987,970
128,640
(344,353)
772,257
(163,188)
434,763
271,575
19,758,473
$20,030,048
Total Operating Revenues
OPERATING EXPENSES
Administrative
Maintenance
Total Operating Expenses
OPERATING INCOME BEFORE DEPRECIATION
DEPRECIATION
OPERATING LOSS
NON-OPERATING INCOME AND (EXPENSES)
Mill levy
Interest on investments and financing lease
Interest expense
Total Non-Operating Income and (Expenses)
LOSS BEFORE CAPITAL CONTRIBUTIONS
CAPITAL CONTRIBUTIONS
NET ASSETS
Increase in Net Assets
Total Net Assets, beginning of year
Total Net Assets, end of year
See notes to financial statements.
$ 454,890
863,561
29,455
39,173
1,387,079
751,734
430,530
1,182,264
204,815
974,140
(769,325)
817,499
147,763
(319,167)
646,095
(123,230)
144,005
20,775
19,737,698
$19,758,473
24
SALINA AIRPORT AUTHORITY
STATEMENTS OF CASH FLOWS
(DIRECT METHOD)
FINANCIAL
January I to December 31
2003 2002
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from providing services
Cash paid to employees for services
Cash paid to suppliers for goods and services
$ 1,374,310
(462,822)
(837,530)
Net Cash Provided in Operating Activities
73,958
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
Acquisition and construction of property, plant and equipment (2,319,252)
Purchases in satisfaction of maintenance agreement (9,736)
Proceeds from capital grants 434,763
Proceeds from property tax 987,970
Principal payments on debt (1,046,750)
Proceeds of new borrowing
Principal received on financing lease
Interest received on financing lease
Bond issue costs paid
Interest paid on long-term debt
81,911
107,535
(338,703)
Net Cash Provided (Used) in Capital and Related
Financing Activities
(2, I 02,262)
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest received on deposits
25,475
INCREASE (DECREASE) IN CASH
(2,002,829)
CASH BALANCE - January I
CASH BALANCE - December 31
3,471,102
$ 1,468,273
CASH AT END OF YEAR
CONSISTS OF:
Unrestricted cash
Restricted cash
$ 1,383,276
85,000
$ 1,468,276
( continued)
See notes to financial statements.
$ 1,503,652
(450,013)
(748,272)
305,367
(2,176,229)
( 19,095)
144,005
817,499
(694,761)
3,200,235
75,541
113,905
(26,119)
(262,795)
1,172,186
30,921
1,508,474
1,962,628
$ 3,471,102
$ 3,386,102
85,000
$ 3,471,102
25
SALINA AIRPORT AUTHORITY
STATEMENTS OF CASH FLOWS
(DIRECT METHOD)
( continued)
FINANCIAL
RECONCILIA nON OF OPERATING LOSS TO NET
CASH FLOWS FROM OPERATING ACTIVITIES
OPERATING LOSS
ADJUSTMENTS RECONCILING OPERATING LOSS
TO NET CASH FROM OPERATING ACTIVITIES:
Depreciation
Basis of assets sold
CHANGES IN ASSETS AND LIABILITIES:
Decrease (increase) in accounts receivable
Decrease in accounts payable - operations
Increase in accrued payroll expenses
Decrease (increase) in prepaid expense
Increase (decrease) in accrued property tax
Increase in unearned rent
NET CASH PROVIDED BY OPERATING ACTIVITIES
See notes to financial statements.
January I to December 31
2003 2002
$(935,445)
$(769,325)
1,022,474
6,631
974,140
83,048
(29,405)
(3,048)
1,239
(4,017)
5,742
9,787
17,358
(735)
1,183
489
(16,958)
16,167
$ 73,958
$ 305,367
26
FINANCIAL
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2003
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. 14, the Authority is considered to be
a component unit of the City of Salina. The Authority is discreetly prestmted 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.
The Authority has implemented a new financial reporting model as required by the provisions of GASB
Statement No. 34, Basic Financial Statements and Management's Discussion and Analysis for State and
Local Governments, as of December 31, 2003. The prior year information has been re-stated to
conform to the new reporting model.
Revenues from airlines, fuel flowage fees, building and land rents, rental car commissions and the sale
of assets are reported as operating revenues. Transactions which are capital, financing or investing
related are reported as non-operating revenues. All expenses related to operating the Airport and
Industrial Center are reported as operating expenses. Interest expense and financing costs are reported
as non-operating expenses.
27
FINANCIAL
C. Assets, Liabilities and Equity
1. Cash and Investments
The Authority's cash and cash equivalents are considered to be cash on hand, dl~mand 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
I of the current year and are a revenue source to be used to finance the budget of the ensuing year.
One-half of the property taxes are due December 20, prior to the fiscal year for which they are budgeted,
and the second half is due the following May 10.
Collection of current year property tax by the County Treasurer is not completed, apportioned nor
distributed to the various subdivisions until the succeeding year, such procedure being in conformity
with governing state statutes. Consequently, current year property taxes receivable are not available as a
resource that can be used to finance the current year operations of the Authority. It is the Authority's
practice to record uncollected current year property tax as an account receivable and to record the same
amount as deferred revenue. It is not practicable to apportion delinquent taxes held by the County
Treasurer and, further, the amounts thereof are not material in relationship to the financial statements
taken as a whole.
3. Inventories
The Authority maintains no significant inventory of office and maintenance suppIÜ:s. These items are
expensed as purchased and no inventory is recorded in these financial statements.
4. Prepaid items
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as
prepaid items.
5. Restricted Assets
Certain proceeds of leasehold revenue bonds are classified as restricted assets on the balance sheet
because their use is limited by applicable bond covenants.
28
FINANCIAL
6. Capital Contributions and Net Assets
Certain expenditures for airport capital improvements are significantly funded through the Federal
Aviation Administration's Airport Improvement Program (AlP), with certain matching funds of the
Authority. Capital funding provided under the AlP grant program is considered e:arned as the related
allowable expenditures are incurred. Grants received under the AlP program are reported in the
Statement of Revenues, Expenses and Changes in Net Assets, after non-operating revenues and
expenses as capital contributions.
7. 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 ITom the United
States of America, September 9, 1966 and recorded at fair value at that date.
Fixed assets are depreciated using the straight-line method over the following estimated useful lives:
Assets
Buildings
Equipment
Vehicles
Airfield
Years
5-50
5 -10
7 -10
10 - 30
8. Compensated Absences
Substantially all full-time employees receive compensation for vacations, holidays, illness and certain
other qualifying absences. The number of days compensated for various categories of absence is
generally based on length of service. Liabilities relating to these absences are rec:ognized as incurred
and included in accrued expenses. The amount accrued for such liabilities at Declember 31, 2003 and
2002 was $16,727 and $16,123 respectively.
II.
STEWARDSHIP, COMPLIANCE AND ACCOUNTABILITY
A. Budgetary Information
The Authority is specifically exempt from Kansas Budget Law. The Authority is not required to
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 that 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.
29
FINANCIAL
III.
DETAILED NOTES
A. Deposits
The bank balance as of December 31, 2003 and 2002 were entirely insured or collateralized with
securities held by third party banks in the Authority's name.
At December 31,2003 and 2002, the carrying amount of the deposits were $1,468,226 and $3,470,437
plus $50 and $665 cash on hand respectively, and the bank balance was $1,462,756 and $3,639,134
respectively. The difference between the carrying amount and the bank balance is outstanding checks.
Of the bank balance, $219,431 and $320,537 respectively was covered by federal deposit insurance and
the remaining $1,243,325 at December 31, 2003 was collateralized by pledged sl;:curities 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.
SALINA AIRPORT AUTHORITY
COMPARISON OF GROSS CASH BALANCES WITH DEPOSITORY SECURITY
Gross Cash Balances
Cash in checking
Cash in savings
Less deposits in transit
Add uncleared checks
December 31. 2003
UMB-
National Bank Sunflower
of America Bank Total
$ 44,965 $ 32,988 $ 77,953
57,646 1,332,627 1,390,273
(29,305) (29,305)
13,137 10.698 23,835
86.443 1,376,313 1,462,756
86.443 132,988 219.431
$ $1.243.325 $1.243.325
$ $1,243,325 $1,243,325
60,075 3.286,157 3,346.232
$ $ $
Bank Balance
Less FDIC Coverage
Balances Securable by Collateral
Security Required
(100%)
Security Provided by Depositories
Amount Under-secured by Statute
30
FINANCIAL
B. Receivables
Receivables as of year-end, including the applicable allowance for uncollectible accounts, are as
follows:
December 31
Receivables:
Accounts
Less: allowance for uncollectibles
2003
$ 111,714
(1.718)
109,996
1.023.355
2002
$ 82,341
(1.750)
80,591
977,990
Taxes
Total
$1.133.351
$1.058.581
C. Net Investment in Financing Lease
Net investment in financing lease is as follows:
December 31
2003
2002
$1,705,014
654.250
Total lease payments receivable
Less: Unearned income
$1,515,568
546,715
$ 968.853
$1.050.764
Net investment in financing leases
Activity in net investment in financing leases was as follows:
December 31
2003
2002
Beginning Balance
Less: Collected principal
$1,050,764
81.911
$1,126,305
75,541
Ending Balance
$ 968.853
$1.050.764
31
FINANCIAL
D. Fixed Assets
The following is a summary of the changes in the general fixed assets account group during the current
year.
Balance Balance
January 1, December 31, -
2003 Additions Dispositions Reclassify 2003
Land $ 9,035,150 $ 33,792 $ $ 38,284 $ 9,107,226
Buildings and improvements 7,814,291 123,113 7,937,404
Airfield and improvements 17,118,787 1,420,280 7,700 124,679 18,656,046
Equipment 1,608,412 474,200 1,224 3,761 2,085,149
Construction in progress 392,816 232,048 (166,724) 458,140
35,969,456 2,283,433 8,924 38,243,965
Less: Accumulated
depreciation 12,268,893 1,022,474 2,291 13,289,076
Total $ 23,700,563 $ 1,260,959 $ 6,633 $ - $ 24,954,889
The following is a summary of proprietary fund-type fixed assets at December 31, 2003 and 2002:
Net Fixed Assets
December 31
2003 2002
$ 9,107,226 $ 9,035,150
7,937,404 7,814,291
18,656,046 17,118,787
2,085,149 1,608,412
458,140 392,816
38,243,965 35,969,456
13,289,076 12,268,893
$24,954,889 $ 23,700,563
Land
Buildings and improvements
Airfield and improvements
Equipment
Construction in progress
Less: Accumulated
depreciation
32
E. Long-Term Liabilities
FINANCIAL
Following is a summary of changes in long-term liabilities for year 2003:
General obligations bonds
Revenue bonds
KDOCH loan payable
Special assessment debt
Balance
January 1,
2003
$7,160,000
315,000
270,620
536,563
$8.282.183
Additions
Balance
December 31,
Reductions 2003
$ 895,000 $6,265,000
70,000 245,000
51,991 218,629
29,759 506,804
$1.046.750 $7.235.433
$
$
The following is a detailed listing of the Authority's long-term debt including general obligation bonds,
revenue bonds and loan payable.
General Obligation Bonds
General Obligation 1998, due 2008
General Obligation 1999-B, due 2010
General Obligation 2001-A, due 2012
General Obligation 2002-A, due 2012
Revenue Bonds
Leasehold revenue 1991, due 2006
Kansas Department of Commerce
and Housing Loan, due 2007
Special assessment debt
Total
Interest expense in 2003 is as follows:
General Obligation Bonds
Revenue Bonds
Loan
Special assessment debt
Add: Amortization of bonds costs
Total
Original
Issue
Interest
Rates
Bonds
Outstandin2
$4,440,000
555,000
1,385,000
2,635,000
4.05% to 5.50%
3.90% to 5.20%
4.45% to 5.60%
2.45% to 3.70%
2,215,000
360,000
1,280,000
2.410.000
6.265.000
$ 850,000 5.00% to 7.25%
$ 468,542 2%
$ 565,235 3.19%
245,000
218.629
506,804
$7.235.433
$ 276,501
22,510
5,154
20.336
324,501
19,853
$ 344.353
33
FINANCIAL
In prior years, the Authority defeased certain general obligation bonds by placing funds in an
irrevocable trust to provide for all future debt service payments on the old bonds. Accordingly, the trust
account assets and the liability for the defeased bonds are not included in the Authority's financial
statements. On December 31,2003, $380,000 of bonds outstanding are considered defeased.
Annual debt service requirements to maturity for general obligation bonds to be paid with tax levies and
rental revenues:
Bonds Interest
Year Outstandin1! Due Total
2004 $ 830,000 $ 253,762 $1,083,762
2005 850,000 220,434 1,070,434
2006 850,000 186,866 1,036,866
2007 885,000 154,858 1,039,858
2008 905,000 120,041 1,025,041
2009-2012 I ,945,000 207,842 2,152,842
$6.265.000 $1.143.803 $7.408.803
Annual debt service requirements to maturity for revenue bonds to be paid with rental revenues:
Bonds Interest
Year Outstandin1! Due Total
2004 $ 75,000 $ 17,610 $ 92,610
2005 80,000 12,285 92,285
2006 90.000 6,525 96,525
$245.000 $ 36.420 $ 281.420
Annual debt service requirements to maturity for Kansas Department of Commerce and Housing Loan
to be paid from rental revenues:
Loan Interest
Year Principal Due Total
2004 $ 53,036 $ 4,109 $ 57,145
2005 54,109 3,043 57,152
2006 55,184 1,955 57,139
2007 56.300 846 57.146
$218.629 $ 9.953 $228.582
34
FINANCIAL
Annual debt service requirement to maturity for Special Assessment Debt to be paid from rental
revenue:
Loan Interest
Year Principal Due Total
2004 $ 30,886 $ 19,209 $ 50,095
2005 32,056 18,038 50,094
2006 33,271 16,824 50,095
2007 34,533 15,562 50,095
2008 35,841 14,254 50,095
2009-2013 200,642 49,826 250,468
2014-2016 139.576 10,711 150.287
$506.805 $ 144.424 $ 651.229
F. Capital Contributions and Net Assets
Since its inception, the Authority has received capital contributions through Federal and State grants as
follows:
Inception to
Date
2003
2002
Federal
State
$ 16,773,982
515,610
$ 434,763
$
144,005
Total
$ 17,289,592
$ 434,763
$ 144,005
=
Unrestricted net assets consist of the following:
December 3!
2003
2002
Designations of unrestricted net assets
Undesignated unrestricted net assets
Total unrestricted net assets
$ 50,000
2,183,330
$2.233.330
$
4.255.094
$4.255.094
During 2003 the Authority designated $50,000 to be used as an insurance increase æserve or to
accelerate future debt service payments. As of December 31 2003, the reserve had been funded but not
used.
35
FINANCIAL
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 supplementalY
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 2003 was 3.67 for January-
March and 3.07% for April through December. The Authority employer contributions to KPERS for
the years ending December 31,2003,2002 and 2001 were $14,490, $12,166, and $11,404 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 employe:es, 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, 2003 and 2002.
36
FINANCIAL
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 Dece:mber 31, 2003.
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 1942 1:0 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 including B-ITs, B-29's, B-4Ts and
the refueling KC-9Ts and KC-135's. The Army Corps of Engineers did a removal of 107 fonl1er
underground storage tanks at the former Base in 1995. The Army Corps of Enginee:rs is now evaluating
any other potential environmental contamination at the former Schilling Air Force Base caused by the
Department of Defense. In addition to efforts by the Corps of Engineers, the Environmental Protection
Agency has conducted an Expanded Site Investigation (ESI) to evaluate all sources of potential
contamination at the Site. During the surnmer of 2003, the Corps of Engineers conducted additional
sampling and investigation work. The Corps of Engineers will report on the results of their work during
2004.
Once the additional information gathering effort has been conducted and all parties know the nature and
the extent of the contamination determined to exist on the property owned by the Authority and other
public and private landowners, which make up the Airport Industrial Center, it is anticipated that there
will be a discussion with respect to cleanup options and allocation of responsibility. At this time, it is
not known whether the City of Salina or the Airport Authority will have cleanup obligations nor can an
estimate of loss or estimate of cleanup cost be reasonably determined.
The Corps of Engineers is in the process of formulating a final work plan for more investigative work in
several areas of the former Schilling Air Force Base. Although the process is moving slowly, it is
believed the Corps of Engineers will take the lead on remediating contamination left behind by the
military.
The Authority also anticipates work in the next year or two related to lead contamination left behind by
an outdoor skeet shooting range located on the southwestern portion of the Airport Industrial Center.
This work is anticipated to be some soil removal of lead contamination caused by lead shot in the
shooting range. At this point, the Authority anticipates conducting any work necessary under the
authority of the Kansas Department of Health and Environment Voluntary Clean-up Program.
37
FINANCIAL
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 fix(~d fee as well as a
contingent rental basis. Ownership risks are retained by the Authority, and accordingly, such leases are
treated as operating leases.
The following is a schedule of minimum future rentals on non-cancellable operating leases to be
received in each of the next five years and thereafter:
Years Ended
December 31
2004
2005
2006
2007
2008
Later years
$ 737,117
638,290
521,745
266,165
126,407
464,1 12
Total
$2.753.836
H. Major Customers
The Authority receives significant operating and financing lease revenue from Raytheon Aircraft
Company, Kansas State University-Salina, Flower Aviation, America Jet, the Schwan Food Company,
and Two Rivers Vending Company. Rentals ITom these six tenants equals 53% of operating and capital
lease revenue for the year ended December 31, 2003.
I. Non-Operating Income
Net non-operating income consisted of the following for the years ended December 31, 2003 and 2002:
2003 2002
Mill levy $ 987,970 $ 817,499
Interest and investment income
Financing lease 103,165 116,842
Other interest 25.475 30,921
Total 1,116,610 965.262
Interest expense
Revenue bond 22,510 21,284
General obligation bonds 276,500 250,686
Special assessment debt 20,336 21,422
Other debt 5,154 5,922
Amortization of bond issue costs 19.853 19,853
Total 344,353 319,167
Net non-operating income $ 772.257 $ 646.095
38
FINANCIAL
J. Commitment Under Operating Lease
The Authority has entered into certain non-cancellable operating lease agreements for the rental of
office equipment. Minimum rentals, on an annual basis are as follows:
Years Ended
December 31
2004
2005
2006
2007
2008
$ 6,180
6,180
6,180
5,578
2,918
$ 27.036
39
(THIS PAGE INTENTIONALL Y LEFT BLANK)
40
lementallnformation
In September 2003, the 77,089 gallons of fuel sold the
airport was the best September record.
from Naval Station 7, Salina Municipal
Airport as a base for training flights at the KS Air National
Guard Smoky Bombing Range during a two-week stay.
(THIS PAGE INTENTIONALLY LEFT BLANK)
41
P P LEMENT AL
SALINA AIRPORT AUTHORITY
SCHEDULES OF REVENUES, EXPENSES AND CHANGES
IN NET ASSETS
January I to December 31
2003 2002
OPERATING REVENUES
Airfield
Fuel flowage fees
Hangar rent
Landing fees
Ramp rent
Total airfield
Building and land rent
Agri land rent
Building rents
Land rents
Tank rent
Total building and land rents
Gain (loss) on sale of assets
Other revenue
ARFF training
Commissions
Other income
Total Other revenue
$ 257,475 $ 278,948
126,133 111,843
6,061 4,514
58,173 59,584
447,842 454,889
59,570 59,161
632,787 596,599
214,915 197,827
9,313 9,975
916,585 863,562
(6,631) 29,455
2,450 5,150
17,862 18,285
9,189 15,738
29,501 39,173
1,387,297 1,387,079
Total operating revenue
OPERATING EXPENSES
Administrative
AlE, consultants, brokers
Airport promotion
Computer network administration
Dues and subscriptions
Employee retirement
FICA and medicare
Industrial development
Insurance, property
Insurance, medical
Kansas unemployment tax
Legal and accounting
Office salaries
Office supplies
Other administrative
Postage
Property appraisals
Property taxes
Telephone
Travel and meetings
Total Administrative Expenses
16,048
33,087
4,633
16,267
15,024
34,189
20,000
107,372
104,925
441
35,774
233,644
9,941
11,145
3,402
4,500
140,959
10,839
22,874
825,064
12,166
21,624
1,610
17,568
12,798
33,886
20,000
83,642
89,761
442
44,892
222,408
9,563
9,822
4,095
2,200
136,714
10,292
18,251
751,734
(continued)
42
PPLEMENT AL
SALINA AIRPORT AUTHORITY
SCHEDULES OF REVENUES, EXPENSES AND CHANGES
IN NET ASSETS
( continued)
Total Maintenance Expenses
January I to December 31
2003 2002
10,795 10,311
2,905 1,306
41,374 39,901
32,182 25,838
21,111 12,483
11,616 4,960
230,417 228,788
11 , 184 9,759
17,379 14,383
96,241 82,80 I
475,204 430,530
1,300,268 1,182,264
87,029 204,815
1,022,474 974,140
(935,445) (769,325)
987,970 817,499
103,165 116,842
25,475 30,921
(324,500) (299,314)
(19,853) (19,853)
772,257 646,095
(163,188) (123,230)
434,763 144,005
271,575 20,775
19,758,473 19,737,699
$20,030,048 $19,758,473
MAINTENANCE EXPENSES
Airfield maintenance
Airport security
Building maintenance
Equipment fuel and repairs
Fire services
Grounds maintenance
Maintenance salaries
Other maintenance expenses
Snow removal expense
Utilities
Total Operating Expenses
OPERATING INCOME BEFORE DEPRECIATION
DEPRECIATION EXPENSE
OPERATING PROFIT (LOSS)
NON-OPERATING INCOME (EXPENSE)
Mill levy
Interest income-capital lease
Interest income
Interest expense
Amortization of bond costs
Net Non-Operating Income
LOSS BEFORE CAPITAL CONTRIBUTION
CAPITAL CONTRIBUTIONS
INCREASE (DECREASE) IN RETAINED EARNINGS
NET ASSETS, January I
NET ASSETS, December 31
43
"PLEMENTAL
SALINA AIRPORT AUTHORITY
CAPITAL EXPENDITURES
January I to December 31
2:003
AIRPORT IMPROVEMENTS
Mill & Patch concrete heaves on airport taxiways
Rwy 18/36 design & construction
FBO aircraft hangar design
10,660
1,384,742
24,878
Total Airport Improvements
1,420,280
BUILDINGS
New gutters at manufacturing facility #498
Manufacturing facility # I 021 improvements
Roof repair at manufacturing facility #512
New carpeting in Salina Dev. Center Unit B
Roof repair at warehouse #595
HV AC improvements in office facility #939
Concrete floor repair in manufacturing facility #498
HV AC improvements at Airport Terminal bldg.
FBO Hangar #409 exterior signage
FBO Hangar #409 exterior awning improvements
FBO Hangar #409 lounge and office carpeting
Construction of two new asphalt parking lots at the Airport Apts.
975
21,813
8,000
2,249
4,465
6,913
1,800
3,385
2,437
3,595
3,183
64,297
Total Buildings
123,112
CONSTRUCTION IN PROGRESS
Airport layout plan update
R wy 17/35 rehab design
Rehabilitation ofRwy 17/35 construction
FAA Airways facility office/shop design
Gun Club environmental
Schilling env. project
Hangar #509 improvements
Hangar #703 improvements
Water line improvements in Schilling Sudivision No.6
9,769
85,464
22,198
31,730
1,272
57,049
][2,313
1l0,4l8
1,836
Total Construction in Progress
232,049
(continued)
44
'l'LEMENT AL
SALINA AIRPORT AUTHORITY
CAPITAL EXPENDITURES
( continued)
January I to December 31
~~003
EQUIPMENT
Two OshKosh rollover snowplows
Lights & control switch at Hangar #504
Motion detectors in Airport Terminal
Pumphouse 305 tank monitor & leak detect system
Cannon Image 0660 copier/printer
Compaq tablet computer
Migmaster 250 welder
Land Pride 9" auger
Two rotary brush brooms
Two NEC flat screen computer monitors
Two-2003 airfield Line Lazer paint stripers
Trailer for runway painting
2003 Chevrolet LD 3500 truck
400,374
1,800
3,050
27 ,656
600
3,367
2,001
965
2,700
780
9,938
895
20,074
Total Equipment
474,200
LAND
Water main improvements NW of Hangar #509
Water service line improvements at office facility #939
Demolition of warehouse facilities #624, #634, #654
1,618
3,074
29,100
Total Land
33,792
TOTAL CAPITAL EXPENDITURES
2,283,433
45
. SU'
SALINA AIRPORT AUTHORITY
GENERAL OBLIGATION BONDS
SERIES 1998 - A
December 31, 2003
Date of issue:
Amount of issue:
Interest rate:
Maurity date:
Principal paid:
Outstanding balance:
'LEft'/ENT AL
June 29, 1998
$4,440,000
4.05% to 5.50%
September 1, 2008
$2,225,000
$2,215,000
Schedule of Bond Interest and Principal Payments
Due in Bond Bond
Year Interest Principal
2004 $ 94,130 $ 445,000
2005 75,662 445,000
2006 56,972 445,000
2007 38,060 440,000
2008 19,140 440,000
$283,964 $2,215,000
46
SUPPL
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 31,2003
Schedule of Bond Interest and Principal Payments
i!ZiŒI
June 29, 1999
$ 555,000
3.90% to 5.20%
September I, 2010
$ 195,000
$ 360,000
Due in Bond Bond
Year Interest Principal
2004 $ 17,672 $ 40,000
2005 15,872 40,000
2006 14,032 30,000
2007 12,623 55,000
2008 9,955 60,000
2009-2010 10,595 135,000
$ 80,749 $ 360,000
47
. SUP'
El~IENTAL
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGATION IMPROVEMENT BONDS
SERIES 200 I - A
December 31, 2003
October 31, 2001
$ 1,385,000
4.45% to 5.60%
September 1,2012
$ 105,000
$ 1,280,000
Schedule of Bond Interest and Principal Pavrnents
Due in Bond Bond
Year Interest Principal
2004 $ 66,298 $ 110,000
2005 60,522 120,000
2006 54,222 125,000
2007 48,660 135,000
2008 42,316 140,000
2009-2012 91,497 650,000
$363,515 $ 1,280,000
=
48
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
'LEMENT AL
GENERAL OBLIGA nON IMPROVEMENT BONDS
SERIES 2002 - A
December 31, 2003
August 29, 2002
$ 2,635,000
2.45% to 3.70%
September I, 2012
$ 225,000
$ 2,410,000
Schedule of Bond Interest and Principal Payments
Due in Bond Bond
Year Interest Principal
2004 $ 75,662 $ 235,000
2005 68,378 245,000
2006 61,640 250,000
2007 55,515 255,000
2008 48,630 265,000
2009-2012 105,750 1,160,000
$415,575 $ 2,410,000
49
SUPP.
SALINA AIRPORT AUTHORITY
LEASEHOLD REVENUE BONDS
SERIES 1991
December 31, 2003
Date of issue:
Amount of issue:
Interest rate:
Maturity rate:
Principal paid:
Outstanding balance:
E1WENT AL
November I, 1991
$ 850,000
5.00% to 7.25%
September I, 2006
$ 605,000
$ 245,000
Schedule of Bond Interest and Principal Payments
Due in Bond Bond
Year Interest Principal
2004 17,610 75,000
2005 12,285 80,000
2006 6,525 90,000
$ 36,420 $ 245,000
50
. SUPPL
EmIl
SALINA AIRPORT AUTHORITY
KANSAS DEPARTMENT OF COMMERCE AND HOUSING, LOAN PAYABLE
December 31, 2003
Date of loan:
Amount of loan:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
October I, 1997
$ 468,542
2%
October 1,2007
$ 249,913
$ 218,629
Schedule of Loan Interest and Principal Payments
Due in Loan Loan
Year Interest Principal
2004 4,109 53,037
2005 3,043 54,103
2006 1,955 55,190
2007 846 56,299
$ 9,953 $ 218,629
:
51
"LEMENT AL
SALINA AIRPORT AUTHORITY
SPECIAL ASSESMENT DEBT-STREET AND UTILITY IMPROVEMENT
December 31, 2003
Date of loan:
Amount of loan:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
September II, 2002
$ 565,235
3.79%
October I, 2011
$ 58,430
$ 506,804
Schedule of Loan Interest and Principal Payments
Due in Loan Loan
Year Interest Principal
2004 $ 19,209 $ 30,886
2005 18,038 32,056
2006 16,824 33,271
2007 15,562 34,533
2008 14,254 35,841
2009-2013 49,826 200,642
2014-2016 10,711 139,575
$ 144,424 $ 506,804
52
Insurance Policy
Employers Insurance of Wausau
on behalf ofUSAIG
Pol. #WCC-Z91-547496-013
National Union Fire Ins. Co. of
Pittsburgh, P A
Pol. #AP3229456-09
The Travelers Insurance Co.
Pol. #P630594X3132TILO3
Pol. #QT-660-594XI925TIL03
Pol. #BAJBMG696X7490TIL03
Pol. #81 0306K4932TIL03
ITT Hartford
Pol. #37BPEAG4896
Northland Insurance
Pol. #MLOlO133
Great American Alliance Ins. Co.
Pol. # KST 788-29-33-09
Northland Insurance
Pol. #A Y060411
SALINA AIRPORT AUTHORITY
INSURANCE IN FORCE
December 31, 2003
Tvpe of Coveraee
Workmen's Compensation
and Employer's Liability
Bodily Injury & Liability
Hangar Keepers
Deluxe Property-Buildings
Business Income
Inland Marine - Equipment
Boiler & Machinery
Vehicles & Equipment
Liability
Medical payments
Uninsured motorists
Crime Policy
Employee theft - per employee
Public Officials & Empl. Liability
Each wrongful act
Aggregate limit
Kansas Underground Storage Tank Liability
Environmental Incident
Annual aggregate
Limit of defense
Law Enforcement Professional Liability
Each person limit
Each occurrence limit
Annual aggregate
, UPPLEMENTAL
Amount of
Coverage
$
500,000
$
$
500,000
500,000
$12,455,674
$ 1,123,878
$ 2,295,003
$ 4,272,796
$ 1,000,000
$ 5,000
$ 1,000,000
$
100,000
$ 1,000,000
$ 1,000,000
$ 1,000,000
$ 1,000,000
$ 100,000
$ 1,000,000
$ 1,000,000
$ 1,000,000
53
(THIS PAGE INTENTIONALLY LEFT BLANK)
54
s
L
TI
In ugust of 2003, new ownership resulted a new name
for one of the commercial aviation businesses at the
Municipal Airport. America Jet at SLN is a full service
aviation business selling Phillips brand aviation fuel. For
calendar year, 4 million gallons aviation fuel was
delivered on the airport at
Salina Airport Authority
OPERATING REVENUE HISTORY
Ten Years Ended December 31,2003
Gain (Loss) Other Total
Fiscal Rental Fuel Flowage Landing on Sale of Operating Operating
Year Revenue Fees Fees Assets Receipts Revenue
1994 $975,011 $90,511 $10,982 - $5,914 $1,082,418
1995 $1,048,563 $98,429 $13,714 ($24,024) $15,637 $1,152,319
1996 $1,038,467 $152,393 $9,055 - $65,723 $1,265,638
1997 $1,067,236 $193,501 $8,503 $69,663 $29,393 $1,368,296
1998 $1,154,716 $178,814 $8,784 - $22,128 $1,364,442
1999 $1,202,149 $234,338 $10,660 - $26,966 $1,474,113
2000 $1,121,194 $263,264 $12,133 $222,664 $25,992 $1,645,247
2001 $1,111,662 $252,942 $7,250 $86,719 $33,162 $1,491,735
2002 $1,034,989 $278,948 $4,514 $29,455 $39,173 $1,387,079
2003 $1,100,891 $257,475 $6,061 ($6,631) $29,501 $1,387,297
Source: Salina Airport Authority Records
\..rI
\..rI
STATISTICAL
Salina Airport Authority
OPERATING EXPENSE HISTORY
Ten Years Ended December 31,2003
Office & Total
Administrative Maintenance Operating
Fiscal Year Expense Expense Expense
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 $386,095 $1,126,625
2001 $754,003 $448,189 $1,202,192
2002 $751,734 $430,530 $1,182,264
2003 $825,064 $475,204 $1,300,268
56
Salina Airport Authority
FEDERAL FINANCIAL ASSISTANCE mSTORY
Ten Years Ended December 31,2003
STA TISTICAL
Fiscal Year
Federal Aviation
Administration
Airport
Improvement Grants
State Commerce &
Housing
Community Development
Block Grant
1994
$270,191
1995
$3,210,933
1996
$2,006,786
1997
$1,640,967
1998
$1,026,918
1999
($7,920)
2000
2001
2002
$144,005
2003
$434,763
NOTE:
1. The use of Federal Aviation Administration Airport Improvement Program
Grant Funds are limited to 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
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
Statements of Net Assets.
3. During 1999, the SAA closed out two (2) Airport Improvement Projects. AlP 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 AlP No. 19.
$841,700
$189,520
57
Salina Airport Authority
CAPITAL EXPENDITURE HISTORY
Ten Years Ended December 31,2003
Construction Total
Fiscal Building in Capital
Year EQuipment Additions Land Infrastructure Airfield Pr02ress Expenditures
1994 $31,289 $305,127 $119,800 - $309,215 - $765,431
1995 $13,043 $403,009 $262,930 - $3,603,339 - $4,282,321
1996 $25,814 $47,925 $147,749 $2,303,568 - $2,525,056
1997 $40,572 $229,999 $111,993 $324,802 $2,079,840 - $2,787,206
1998 $53,972 $266,894 - $4,622,240 $1,167,881 - $6,110,987
1999 $25,908 $490,557 $132,948 $642,111 $97,328 - $1,388,852
2000 $43,108 $372,277 $226,193 $15,215 $93,548 - $750,341
2001 $49,520 $172,295 $202,248 - $144,249 - $568,312
2002 $125,318 $1,067,221 $616,474 - $9,385 $392,816 $2,211,214
2003 $474,200 $123,113 $33,792 - $1,420,280 $232,048 $2,283,433
Source: Salina Airport Authority Records
V1
00
STATISTICAL
Salina Airport Authority
REVENUE BOND COVERAGE
Ten Years Ended December 31,2003
1994
$421,554
Revenue Bond
Debt Service Covera2e
$280,578 1.50
$163,215 1.16
$163,790 1.16
$168,962 1.12
$163,938 1.16
$163,841 1.16
$185,013 1.02
$164,420 1.15
$158,320 1.20
$151,923 1.25
Fiscal
Year
Pledged
Revenue
1995
$189,446
1996
$189,446
1997
$189,446
1998
$189,446
1999
$189,446
2000
$189,446
2001
$189,446
2002
$189,446
2003
$189,446
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
59
Salina Airport Authority
Principal Customers
Year Ended December 31,2003
Company
Raytheon Aircraft Co.
Kansas State University-Salina
Flower Aviation
Midway Aviation
Schwan Food Company
Two Rivers Vending Co., Inc.
JRM Enterprises, Inc., d/b/a America Jet
Geocore Services
Aerospace Systems & Technologies, Inc.
AcuStep, Inc.
Federal Aviation Administration
Palleton of Kansas, Inc.
Salina Vortex Corporation
Builders Choice Concrete
Kejr, Joe
Waddle's Manufacturing & Machine
Laas, Brent and Mark
Hertz Corporation
Blicks Agri-Farm Cen
WWC License LLC
Professional Flight Training, LC
Palmer Trucking Co.,
Snak-Atak
L & R Farms
Triangle Trucking
Scrommel Resource Management, Inc.
Salina Auto Auction
Mesa Airlines/Air Midwest
Salina Snack Sales
Bostater Realty, Inc.
Scientific Engineering
Civil Air Patrol, KS Wing HDQ
Revenue
$265,230
232,891
157,417
101,816
87,114
48,993
48,209
35,280
31,390
24,448
22,350
21,600
20,116
17,490
15,342
15,000
14,805
14,561
12,996
12,860
12,700
12,648
12,410
12,317
12,189
11,658
11,170
10,437
9,675
8,860
8,700
7,836
STATISTICAL
% of Operating & Direct
Finance Lease Revenue
16.75%
14.71 %
9.94%
6.43%
5.50%
3.09%
3.04%
2.23%
1.98%
1.54%
1.41 %
1.36%
1.27%
1.10%
0.97%
0.95%
0.94%
0.92%
0.82%
0.81%
0.80%
0.80%
0.78%
0.78%
0.77%
0.74%
0.71%
0.66%
0.61%
0.56%
0.55%
0.49%
Total Operating Lease and Direct Finance Lease Revenue for 2003 was $1,583,374
Source: Salina Airport Authority Records
60
Salina Airport Authority
LOCAL GOVERNMENT MILL LEVY RATES, DIRECT AND OVERLAPPING
Ten Years Ended December 31,2003
Other
Unified Salina State Special
Fiscal Saline City of School Airport of Taxing
Year County Salina Dist. #305 Authoritv Kansas Districts Total
1994 26.575 28.709 42.401 1.900 1.5 5.015 106.100
1995 23.370 27.145 42.287 1.372 1.5 5.393 101.067
1996 22.925 26.942 42.312 1.275 1.5 5.565 100.519
1997 18.141 25.705 39.529 1.129 1.5 5.804 91.808
1998 20.488 25.270 36.840 2.950 1.5 5.419 92.467
1999 23.187 24.876 56.321 2.653 1.5 5.419 113.828
2000 22.337 24.365 58.524 2.426 1.5 5.183 114.335
2001 24.066 24.218 68.178 2.424 1.5 5.406 125.792
2002 25.657 24.092 57.384 2.806 1.5 5.378 116.817
2003 28.081 24.013 56.632 2.795 1.5 5.553 118.574
Note:
Funds generated from the Salina Airport Authority's 2003 mill levy become available during calendar year 2004 and are budgeted accordingly.
Source: Saline County Clerk
'"
I-'
ST A TISTI CAL
Salina Airport Authority
MILL LEVY REVENUE
Ten Years Ended December 31,2003
Fiscal Year
Mill Levy
Revenue
1994
$301,829
1995
$406,232
1996
$357,887
1997
$338,058
1998
$322,270
1999
$783,363
2000
$801,237
2001
$795,404
2002
$817,499
2003
$987,970
Source: Salina Airport Authority Records
62
STATISTICAL
Salina Airport Authority
AIR TRAFFIC, FUEL FLOWAGE AND ENPLANEMENT TRENDS
Ten Years Ended December 31,2003
Scheduled
Fiscal Air Traffic Fuel Flowage Air Service
Year Operations Gallons Enplanements
1994 61,215 2,424,880 7,175
1995 68,291 2,435,656 7,813
1996 62,021 2,907,894 8,652
1997 68,822 3,577,650 9,153
1998 80,338 3,603,673 12,909
1999 90,400 3,808,886 13,436
2000 87,709 4,472,164 10,270
2001 92,870 4,396,429 6,507
2002 95,801 4,695,093 2,565
2003 86,214 4,358,563 2,319
Note:
One air traffic operation equals one aircraft takeoff and landing
Source: Salina Airport Authority Records
63
STATISTICAL
Salina Airport Authority
MAJOR EMPLOYERS IN THE SALINA/SALINE COUNTY AREA
December 31, 2003
Major Private Emplovers
Company
Approx. #
Emplovees
Tony's Pizza
Salina Reg. Med. Center
Exide Corporation
Great Plains Manufacturing
Philips Lighting
Solomon Corp.
Lock/Line
Raytheon Aircraft Co.
Eldorado National, Inc.
Wal-Mart
Crestwood Cabinets, Inc.
OCCK
Advance Auto/Parts America
KASA/KASA Fab
Lowe's Home Improvement
Exline
Salina Journal
Sunflower Bank
Premier Pneumatics
Blue Beacon Int'l
PKM Steel
2,000
1,082
800
650
600
300
420
234
255
183
160
150
150
140
140
130
130
120
115
104
100
Major Public Emplovers
Public Ore:anizations
Approx. #
Emplovees
Unified School District #305
City of Salina
Saline County
US Postal Service
Kansas State University - Salina
935
471
233
128
126
Source: Salina Area Chamber of Commerce
Type of
Business
Frozen Foods Manufacturer
Health Care
Battery Manufacturing
Fann Implements & Landscaping Equipment
Fluorescent Lamp Manufacture
Electrical Equipment
Cell Phone Insurance
Aircraft Sub-assemblies Manuf.
Medium & Small Shuttle Buses
Retail
Custom Made Cabinets
Plastic products, Subcontracting
Warehouse Distribution
Electronic Controls & Steel Fabrication
Home Improvement Retail
Structural steel fabrication
Newspaper Publishing
Bank
Pneumatic Convey Equipment
Truck Wash
Steel Fabrication
Tvpe of Public Bodv
School System
City Government
County Government
Postal Service
Engineering Technology & Aviation Technology
64
Salina Airport Authority
SALINE COUNTY POPULATION, DEMOGRAPHIC AND LABOR STATISTICS
Year
Population
Saline County Population
1994
1995
1996
1997
1998
1999
2000*
2001
2002
2003
52,240
52,892
53,140
53,168
53,182
53,485
53,597
53,785
53,902
53,737
III 54,500
"0 54,000
c: 53,500
: 53,000
::::I 52,500
~ 52,000
I- 51,500
51,000
~..s:J,V:> ~ ~ ..s:J,'Þ ~ cl ~" ~').o.JJ'>
,,<1) ~- ,,<1) ,,<1) ,,«>- ,,<1) ~Çj rþS rþS 17-
Year
Note: * Indicates decennial census 100% population counts. Other counts are population estimates.
Demographics
Median Age (2000)
Number of Households (2000)
Median Household Income (2000)
Per Capita Income (2001)
36.1
21,436
$39,862
$28,168
Employment and Civilian Labor Force
(Annual Average)
Civilian Labor
Year Force Employed Unemployed
Employment and Civilian Labor
Force
1993 28,603 27,415 1,188
1994 27,748 26,679 1,069
1995 29,580 28,376 1,204 32,000
1996 29,966 28,800 1,166 30,000
1997 30,178 29,082 1,096 28,000
1998 30,420 29,365 1,055 26,000
1999 30,906 30,144 762 24,000
2000 30,559 29,703 856 â>'? â>';> ~ ~~ ~':'
>$i >$i .$l ~
2001 30,093 29,037 1,056
2002 30,569 29,462 1,107
Sources: Institute for Public Policy and Business Research, University of Kansas and
Kansas Department of Human Resources Labor Market Information Services
United States Census Bureau
65
Salina Airport Authority
SALINE COUNTY EMPLOYMENT DATA
Annual Average Unemployment - 1994-2003
1994 1,069 3.90%
1995 1,204 4.10%
1996 1,166 3.90%
1997 1,096 3.60%
1998 1,055 3.50%
1999 762 2.50%
2000 856 2.80%
2001 1,055 3.50%
2002 1,104 3.60%
2003 1,247 4.00%
Year
Unemployment
Unemployment
Rate
Saline County Unemployment Rate
History
6.00%
4.00%
2.00%
0.00%
Year 1994 1995 1996 1997 1998 199920002001 2002
Employment by Industry
2000
1990
Services
Retail Trade
Manufacturing
Government & Gov't Services
Construction
Finance, Insurance, Real Estate
Wholesale Trade
Transportation
Fann
Ag. Services
Mining
(D)=suppressed to avoid disclosure
11,135
7,864
6,967
4,422
(D)
2,208
1,714
1,939
771
(D)
(D)
8,935
6,332
5,969
3,823
1,715
1,491
1,814
1,222
851
265
262
Sources: Institute for Public Policy and Business Research
University of Kansas, Salina/Saline County Profile Report
United States Census Bureau
66
AU I 0 5'
T
TI
N
Yes, it does snow in Kansas. The Salina Airport
received $360,337 in grant funds from the Federal Aviation
Administration to purchase two new snow plows.
was part of the FAA's Airport Improvement Program
CLUBlNE&
RETIELE
CHARfERED
Certified Public Accountants
(fI1
Robert I. Clubine, C.P.A.
David A. Rettele, C.P.A.
Jay D. Langley, C.PA
Jon K. Bell, C.PA
Leslie M. Corbett, C.PA
Stacy J. Osner, C.PA
Marci K. Fox, CPA
Valerie K. Linenberger, C.PA
Delores K. Longenecker, C.P.A.
John T. Millikin, C.PA
Linda A. Suelter, C.PA
218 South Santa Fe
P.O. Box 2267
Salina, Kansas
67402-2267
Salina
785 / 825-5479
Salina Fax
785 / 825-2446
Ellsworth
785/472-3915
Ellsworth Fax
785/472-5478
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
We have audited the financial statements of Salina Airport Authority as of and for
the years ended December 31, 2003 and 2002, and have issued our report thereon
dated April 30, 2004. We conducted our audit in accordance with auditing
standards generally accepted in the United States of America, the standards
applicable to financial audits contained in Government Auditing Standards, issued
by the Comptroller General of the United States and the Kansas Municipal Audit
Guide, prescribed by the Director of Accounts and Reports, Department of
Administration of the State of Kansas.
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 could have a direct and material effect on the
determination of financial statement amounts. However, providing an opinion on
compliance with those provisions was not an objective of our audit, and
accordingly, we do not express such an opinion. The results of our tests disclosed
no instances of noncompliance 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 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.
67
This report is intended solely for the information and use of the audit committee, management, others within
the organization, the City Commission and federal awarding agencies and pass-through entities and is not
intended to be and should not be used by anyone other than these specified parties.
~T~l~ffi~6
April 30, 2004
68
CLUBlNE&
RETIELE
CHARfERED
Certified Public Accountants
crtIl
Robert I. Clubine, C.PA
David A. Rettele, C.PA
Jay D. Langley, C.PA
Jon K. Bell, C.PA
Leslie M. Corbett, C.PA
Stacy J. Osner, C.PA
Marci K. Fox, C.PA
Valerie K. Linenberger, C.PA
Delores K. Longenecker, C.PA
John T. Millikin. C.PA
Linda A. Suelter, C.PA
218 South Santa Fe
P.O. Box 2267
Salina, Kansas
67402-2267
Salina
785 / 825-5479
Salina Fax
785 / 825-2446
Ellsworth
785/472-3915
Ellsworth Fax
785/472-5478
REPORT ON COMPLIANCE WITH REQUIREMENTS
APPLICABLE TO EACH MAJOR PROGRAM AND INTERNAL
CONTROL OVER COMPLIANCE IN ACCORDANCE
WITH OMB CIRCULAR A-133
To the Board of Directors
Salina Airport Authority
Compliance
We have audited the compliance of Salina Airport Authority, with the types of
compliance requirements described in the U. S. Office of Management and Budget
(OMB) Circular A-I33 Compliance Supplement that are applicable to each of its
major federal programs for the year ended December 31,2003. Salina Airport
Authority's major federal programs are identified in the summary of auditors'
results section of the accompanying schedule of findings and questioned costs.
Compliance with the requirements of laws, regulations, contracts and grants
applicable to each of its major federal programs is the responsibility of Salina
Airport Authority's management. Our responsibility is to express an opinion on
Salina Airport Authority's compliance based on our audit.
We conducted our audit of compliance in accordance with auditing standards
generally accepted in the United States of America; the standards applicable to
financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States; and OMB Circular A-133, Audits of
States, Local Governments, and Non-Profit Organizations. Those standards and
OMB Circular A-I33 require that we plan and perform the audi1: to obtain
reasonable assurance about whether noncompliance with the types of compliance
requirements referred to above that could have a direct and material effect on a
major federal program occurred. An audit includes examining, on a test basis,
evidence about Salina Airport Authority's compliance with those requirements and
performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion. Our audit
does not provide a legal determination on Salina Airport Authority's compliance
with those requirements.
In our opinion, Salina Airport Authority complied in all material respects, with the
requirements referred to above that are applicable to each of its major federal
programs for the fiscal year ended December 31, 2003.
Internal Control Over Compliance
The management of Salina Airport Authority is responsible for establishing and
maintaining effective internal control over compliance with requirements of laws,
regulations, contracts and grants applicable to federal programs. In planning and
performing our audit, we considered Salina Airport Authority's internal control
over compliance with requirements that could have a direct and material effect on a
major federal program in order to determine our auditing procedures for the
purpose of expressing our opinion on compliance and to test and report on the
internal control over compliance in accordance with OMB Circular A-133.
69
Our consideration of the internal control over compliance would not necessarily disclose all matters in the
internal control 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 noncompliance with applicable requirements of laws, regulations, contracts and grants that would be
material in relation to a major federal program 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 compliance and its operations 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, the City Commission and federal awarding agencies and pass-through entities and is not
intended to be and should not be used by anyone other than these specified parties.
CLUBINE AND RETTELE, CHARTERED
~!\'\L oJ.. ~
70
SALINA AIRPORT AUTHORITY
Salina, Kansas
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
For the Year Ended December 31,2003
Federal
CFDA
Number
Federal Grantor / Pass-through Grantor /
Program or Cluster Title
U.S. Department of Transportation
Airport Improvement Program
20.106
Schedule 1
Pass-through
Entity
Identifying Federal
Numbé:r Expenditures
N/A
See notes to the schedule of expenditures of federal awards.
$
434,763
71
SALINA AIRPORT AUTHORITY
Salina, Kansas
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL A WARDS
For the Year Ended December 31,2003
Note 1 Basis of Presentation
The accompanying schedule of expenditures of federal awards includes the federal grant activity of
Salina Airport Authority and is presented on the accrual basis of accounting. The information in this
schedule is presented in accordance with the requirements ofOMB Circular A-133, Audits of States,
Local Governments, and Non-Profit Organizations. Therefore, some amounts presented in this
schedule may differ from amounts presented in, or used in the preparation of, the basic financial
statements.
72
SALINA AIRPORT AUTHORITY
Salina, Kansas
Schedule 2
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
For the Year Ended December 31, 2003
There are no prior audit findings.
73
SALINA AIRPORT AUTHORITY
Salina, Kansas
Schedule 3
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
For the Year Ended December 31, 2003
SUMMARY OF AUDIT RESULTS
1. The auditors' report expresses an unqualified opinion on the financial statements of Salina Airport
Authority.
2. No instances of noncompliance material to the financial statements of Salina Airport Authority were
disclosed during the audit.
3. The auditors' report on compliance for the major federal award programs for Salina Airport Authority
expresses an unqualified opinion on all major federal programs.
4. There were no audit findings relative to the major federal award programs for Salina Airport Authority.
5. The programs tested as major programs included:
20.106
Airport Improvement Program
6. The threshold for distinguishing Types A and B programs was $300,000.
7. The Salina Airport Authority was determined to be a high risk auditee.
FINDINGS - FINANCIAL STATEMENTS AUDIT
None.
74
SALINA AIRPORT AUTHORITY
Salina, Kansas
Schedule 4
CORRECTIVE ACTION PLAN
For the Year Ended December 31,2003
None required.
75
(THIS PAGE INTENTIONALLY LEFT BLANK)
76
.
1
++-+
!J~ e~-f~t
in 2003, SAA finalized several facility improvement
projects within the Salina Airport Industrial Center. The
newly renovated manufacturing building pictured above will
provide 66,926 sq. for new tenant.