Audit Report - 2005
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, 2005
Prepared by the Management
of the
Salina Airport Authority
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TABLE OF CONTENTS
COMPREHENSIVE ANNUAL FINANCIAL REPORT
For the Fiscal Year Ended December 31, 2005
INTRODUCTORY SECTION
Letter of Transmittal............................................ ............................... .......... 1-9
Principal Officers....................................................................................,..... 10
Authority Staff Members.............................................................................. 11
Organizational Chart..................................................................................... 12
Certificate of Achievement............................................ ..... .......................... 13
Salina Municipal Airport Aerial View.......................................................... 14
FINANCIAL SECTION
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Independent Auditors' Report ....................................................................... 15-16
Management's Discussion and Analysis ...................................................... 17-23
Statements of Net Assets............................................................................... 24-25
Statements of Revenues, Expenses and
Changes in Net Assets............................................................................... 26
Statements of Cash Flows (Direct Method) ............................................ ...... 27-28
Notes to Financial Statements......................................................... .............. 29-41
Supplemental Information
Schedules of Revenues, Expenses and Changes in Net Assets................... 44-46
Capital Expenditures................................................................................... 47-49
General Obligation Bonds - Series 1998-A ............................................... 50
General Obligation Refunding Bonds - Series 1999-B .............................. 51
General Obligation Improvement Bonds - Series 2001-A......................... 52
General Obligation Improvement Bonds - Series 2002-A......................... 53
General Obligation Improvement Bonds - Series 2005-A ........................ 54
Leasehold Revenue Bonds - Series 1991 ................................................... 55
KDOCH Loan Payable............................................................................... 56
Special Assessment Debt-Street and Utility Improvement........................ 57
Insurance in Force...................................................................................... 58
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STATISTICAL SECTION
Operating Revenue History........................................................................... 59
Operating Expense History ........................................................................... 60
Federal Financial Assistance History....................................... ..................... 61
Capital Expenditure History.......................................................................... 62
Revenue Bond Coverage............................................................................... 63
Principal Customers...................................................................................... 64
Local Government Mill Levy Rates, Direct and Overlapping...................... 65
Mill Levy Revenue........................................................................................ 66
Air Traffic, Fuel Flowage, and Enplanement Trends ................................... 67
Major Employers........................................................................................... 68
Saline County Population, Demographic and Labor Statistics ..................... 69
Saline County Employment Data.................................................................. 70
COMPLIANCE
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Report on Internal Control Over Financial
Reporting and on Compliance and Other Matters Based on an Audit
of Financial Statements Performed in Accordance with
Government Auditing Standards.......................................................... 71-72
Report on Compliance with Requirements Applicable to
Each Major Program and Internal Control Over Compliance
In Accordance with OMB Circular A-133 .......................................... 73-74
Schedule of Expenditures of Federal A wards ....................... ........................ 75
Notes to Schedule of Expenditures of Federal Awards ............................... 76
Summary Schedule of Prior Audit Findings ................................................ 77
Schedule of Findings and Questioned Costs ................................................ 78
Corrective Action Plan ................................................................................. 79
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WTRODUCTORYSECnON
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On March 3, 2005, Salina, Kansas entered the list of roll call
cities in aviation history after Steve Fossett became the first
person to fly an airplane nonstop, solo, around the world
without refueling when he landed the Virgin Atlantic
GlobalFlyer at the Salina Airport 67 hours after take-off from
Salina. The Airport's aeronautical school, Kansas State
University at Salina was the host for the flight's mission
control center.
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Chairman
Stephen C. Ryan
Vice-Chairman
Eric R. Hardman
Secretary
Robert H. Miller
Treasurer
Julie Sager Miller
Past Chairman
Dr. Randy Hassler
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, C.M.
80ard Attorney Greg A. 8engtson
June 16, 2006
Salina Airport Authority Board of Directors
3237 Arnold Ave.
Salina, KS 67401
To the Board of Directors of the Salina Airport Authority:
The Comprehensive Annual Financial Report (CAFR) of the Salina Airport Authority (the "Authority")
for the fiscal year ended December 31, 2005 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 2005 CAFR. Responsibility for both the accuracy of the data presented and the
completeness and fairness of the presentation, including all disclosures, rests with the Executive Director
of the Authority. To the best of our knowledge and belief, the data as presented is accurate in all
material aspects, that it is presented in a manner designed to fairly set forth the fiscal position and results
of the operation of the Authority as measured by its financial activity, and that all disclosures necessary
to enable the reader to gain maximum understanding are included in the report.
This CAFR is presented in accordance with generally accepted accounting principles (GAAP) and
pursuant to K.S.A. 27-324, an audit of the books, accounts and financial statements has been completed
by the Authority's independent certified public accountants, Clubine and Rettele, Chartered. The
independent audit is in accordance with the Kansas Municipal Audit Guide, the Government Auditing
Standards issued by the Comptroller General of the United States, and the provisions of the Office of
Management and Budget Circular A-133, "Audits of States, Local Governments and Nonprofit
Organizations" .
GAAP requires that management provide an overview and analysis to accompany the financial
statements in the form of a Management Discussion and Analysis (MD&A). It is recommended that this
letter of transmittal be read in conjunction with the MD&A, which can be found immediately following
the report of the independent auditor in the Financial Section of this report.
ORGANIZATION OF THE REPORT
The Authority applies the standards for preparation of local government [mancial reports recommended
by the Government Finance Officers of the United States and Canada (GFOA). The Authority's 2005
Comprehensive Annual Financial Report is presented in four sections:
Introductorv 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
2004, and an aerial photo of the Salina Municipal Airport and Airport Industrial Center.
S(ii'AiP;;; 3237 Arnold J Sal;"o, KS 6740'.8190 J 785.827.3914 J Fax: 785.827.2221 SA~I.Nfl~J!!}!I
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INTRODUCTORY
Financial Section - includes the independent auditors' report, Management's
Discussion and Analysis (MD&A), the Authority's 2005 financial statements and the
required supplemental information.
Statistical Section - includes selected financial and demographic information, which
highlights economic and demographic trends.
ComDliance Section - includes reports concerning the Authority's compliance and
internal control over fmancial 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 the former Schilling
A.F.B., which was closed by the United States Department of Defense in June 1965. By quitclaim deed
the Authority received over 2,900 acres of land and numerous buildings for the purpos'e 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 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 at Salina (KSUS). The campus of KSUS is located
adjacent to the Airport. The college offers degrees in professional flight training, airframe and power
plant maintenance, and avionics technology.
The Salina Municipal Airport and Airport Industrial Center is home for 80 businesses and organizations.
Forty-five ofthe businesses and organizations are tenants of the Authority. One of the primary functions
of the Authority is to facilitate the continued growth of jobs and payroll at the Airport and Airport
Industrial Center. The Authority works in partnership with the City of Salina, Saline County and the
Salina Area Chamber of Commerce for the retention of existing business and industry and the
recruitment of new business and industry.
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INTRODUCTORY
ECONOMIC CONDITIONS AND OUTLOOK
Local Economv
The Salina/Saline County economy has continued to demonstrate economic strength, as compared to
other regions of the state. In 2005, Saline County's total employment increased by over 600 and the
average unemployment rate fell from 4.8 percent to 4.4 percent. During the year, over 333,000 sq. ft. of
manufacturing space was under construction with total capital investment in excess of $30 million.
Salina's visitor count during 2005 is estimated at over 500,000. Lodging revenue reached a record high
of over $17 million. Growth in the areas of manufacturing, transportation, finanee, real estate,
insurance, services and retail trade, confirm Salina's position as one of Kansas' strongest regional
economic centers.
In recent studies by Kansas State University, Saline County ranks fourth in the state out of 105 counties
in "Retail Trade Pull Factor". The high trade pull factor is a reflection of retail sales activity, indicating
that a large volume of retail sales activity is coming from outside of Saline County. The: county's trade
area capture increased from 68,259 to 69,060, and the percent of Saline County retail trade increased
from 94.33 percent to 94.88 percent.
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 countic~s, and is made
up of three components including wealth, personal income and employment indices. Th(: 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 31,2005,80 businesses and organizations at the Salina Municipal Airport and Airport
Industrial Center employed nearly 4,000 employees. Total payroll was an estimated $128 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 Chambc;:r of Commerce
forecasts that approximately 700 new jobs per year will be added to the economy over the next three to
five years.
Salina Municipal Airport businesses including Aerospace Systems and Technologies, Inl~., America Jet,
Federal Aviation Administration Systems Service Center, Flower Aviation of Kansas, Ine., Kansas State
University at Salina, and Raytheon Aircraft Company continue work on facility expansion plans. Salina
Airport Industrial Center businesses including Geoprobe Systems, Schwan's Global Supply Chain, Inc.,
Salina Vortex Corporation, and the Kansas Army National Guard at Salina, also continue to work on
facility expansions. Collectively, these expansions will result in additional jobs and payroll.
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INtRODUCTORY
Major development initiatives throughout Salina got underway in 2005 including a $5 million expansion
of the Crestwood, Inc.'s custom cabinetry facility and the expansion of the Land Pride Division of Great
Plains Manufacturing plant. The medical segment of the city had its own initiatives including a $1
million expansion to the Salina Surgical Center and the construction of a $3.5 million Hospice facility.
A major economic initiative came about in 2004 with the passage of a one-quarter cent city sales tax,
designating 12.5 percent or approximately $275,000 per year for economic development. The funds will
be available to assist in the job-training portion of the Salina community's new economic development
initiatives, which are designed to help keep Salina competitive with other communities. During 2005,
the Salina Economic Development Incentives Council was formed for the purposes of making
recommendations to the City Commission on the utilization of the economic development funds.
The Salina Airport Authority in partnership with the Salina Area Chamber of Commerce, the City of
Salina and Saline County, continue to work and expand on economic developm{:nt programs that
include web based building and site directories, electronic newsletters, trade show participation and
expanding contacts through the Kansas Department of Commerce.
INITIATIVES AND DEVELOPMENT
Salina Municipal Airport (SLN)
Virgin Atlantic GlobalFlyer
In partnership with the Salina Area Chamber of Commerce, Kansas State University at Salina and
numerous volunteer groups, the Salina Municipal Airport was the launch and landing site for the Virgin
Atlantic GlobalFlyer. On March 3, 2005, pilot Steve Fossett landed back in Salina after becoming the
first person to fly solo, non-stop around the world without refueling. The Salina Municipal Airport held
thousands of spectators watching this historic aviation event. The local, national and worldwide media
coverage received was unprecedented for the Airport and the community. Throughout the year, the
Virgin Atlantic GlobalFlyer was housed in Hangar 703 and the Authority hosted many events related to
its presence. Salina quickly became known as the "Home of the GlobalFlyer".
Airport Events
The Salina Municipal Airport was also the host airport for the 2005 National Intercollegiate Flying
Association's SAFECON event. This national airmeet hosted by Kansas State University at Salina,
promotes aviation safety and education. Hangar 509 was utilized for the event that brought students
from 31 colleges throughout the country.
Later in the year the Authority hosted the Chief Naval Air Training Detachment A-Team from Meridian,
MS from August 21-30. This T -45 unit brought II aircraft along with 20 military personnel and 15
civilians to the Salina Airport. The unit based its training from the Airport's Hangar No. 509.
Hangar No. 509 was the site of a Kansas Highway Patrol Training Event from October 21 - 27. Over 80
officers from throughout the Midwest spent their days in Hangar 509 learning the latest in trooper skills
related to homeland security.
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INTRODUCTORY
SLN Airspace Study
Early in the year, the airspace design division of Jeppesen Sanderson completed the airspace and
approach procedure feasibility study for the Salina Municipal Airport. The results of this, all inclusive
instrument procedure feasibility study identified two major areas for improvement including the lack of
radar coverage by Kansas City Center below 2,000 feet at SLN and the lack of a precision type approach
to Runway 17. This study paved the way for the Authority to begin negations with FAA to acquire a
radar system that would address these concerns.
NCK Radar Project
With the airspace study results in hand; the Authority began working on a radar project that would
accommodate the need for improved SLN Coverage. The Authority began looking at ways to improve
coverage for not only Salina, but other areas in North Central Kansas as well. The North Central Kansas
Radar project was born and the Authority began researching radar systems that would accommodate
Salina, Manhattan and Fort Riley. The ASR-ll Radar system was identified as a possible solution and a
siting analysis report was completed. In October 2005, the Authority made a presentation at Fort Riley
to the NCK radar partners to discuss the acquisition and location for a radar system that would integrate
with the National Airspace System.
Congressional action that assures the success of the project included report language in thl~ fiscal year
2006 Department of Transportation appropriation's bill stating the need for improved North Central
Kansas radar coverage and directed the Federal Aviation Administration and the United States Army to
develop a surveillance solution.
In late December, Congress passed the fiscal year 2006 Department of Defense appropriation's bill that
approved $3.3 million for Phase I of the N0l1h Central Kansas radar project including siting,
engineering, construction and commissioning.
Airport Certification Inspection
During March, the Federal Aviation Administration completed the Salina Municipal Airport's 2005
airport certification inspection. This represented the second year in a row that the Authorllty received
zero items of correction.
Mobile ARFF Trainer
May 17-19 the Salina Municipal Airport hosted the Mobile Aircraft Firefighting Trainer (MAFT). This
year represented the Airport's 4th year to host this training event. Rosenbauer America, Inc., the
manufacturer of the Airport's new ARFF vehicle, sponsored the event that brought firefighters to Salina
from across the State.
FAA AlP 24 and 25 Projects
In April, the Authority took delivery of a new Aircraft Rescue and Firefighting vehicle that was 95%
federally funded through the Federal Aviation Administration's (FAA) Airport Improvement Program
(AlP). The vehicle has the capacity for 1,500 gallons of water, 200 gallons of foam and 500 pounds of
dry chemical and replaced a 20-year-old ARFF vehicle.
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INtRODUCTORY
In July, the Authority accepted a $4,039,730 AlP grant from the FAA to fund the reconstruction ofthe
Airport's crosswind Runway 12/30. A contract was awarded to APAC-Kansas, Inc., Shear's Division
and the project was substantially completed in November.
North Ramp Redevelopment
During the 4th quarter, the Authority began looking at the redevelopment of the north ramp for aviation
related industries. A project scope was identified and a preliminary layout is being dev(~loped. This area
will constitute the primary growth area for the SLN Aviation Service Center.
New Aviation Business
The Authority welcomed a new aviation business to the field during 2005. Wells Aircraft began its
operation in Salina in December and will offer aircraft owners airframe and powerplant services as well
as avionics installation and repair for a wide range of general aviation aircraft.
Salina AirDort Industrial Center
Salina Vortex Corporation Project
Early in 2005, the Authority in partnership with the Salina Area Chamber of Commerce and the
Salina Economic Development Corporation (SEDC), worked with Salina Vortex on a plan that
would allow them to expand their operations by constructing a new facility within the Airport
Industrial Center.
In January 2005, the Authority approved the contract for sale ofreal estate for Bldg. 217 and the
underlying land located at 3024 Arnold Ave. This sale, allowing Salina Vortex to own their
existing facility, was the first step in the process. The second step was the sale of the land from
the Authority to the SEDC for the site for new construction. This sale was finalized in June of
2005 and the SEDC began construction of the new Salina Vortex facility. Upon completion of
the new facility, Salina Vortex and SEDC will swap buildings under an Internal Revenue Code
Section 1031 exchange. During 2005 the Authority and the SEDC began marketing the former
V ortex facility to new industrial center prospects.
Bide. No. 1021 Renovation and Lease
In March 2005, the Authority and the State's Adjutant General's Department announced that
Building No. 1021 in the Airport Industrial Center would be the new location for the Kansas
Army National Guard's Readiness Sustainment Maintenance Site. A 10-year lease agreement
for this 67,859 sq. manufacturing facility was approved and the Authority completed all
necessary improvements for the KSARNG's occupancy.
Bide. No. 394 Lease
During November 2005, the Authority leased the last of the buildings that had b{~en remodeled
under the 2001 Airport Industrial Center facility improvement bonds. The Authority entered
into a five-year lease agreement with AFK Properties, Inc. for the Occupational Center of
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INTRODUCTOR Y
Central Kansas to utilize the building as their community outreach center. The headquarters for
OCCK is adjacent to Bldg. 394 to the east.
Geoprobe Option A2reement
Also during November, the Authority entered into an agreement with Geoprobe Systems for the
option to purchase a total of23.9 acres ofland within the south Airport Industrial Center
Subdivison. This three-year option agreement provides Geoprobe the ability to continue their
plans for long-term growth in Salina.
Capital Financial Plannine:
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. A significant
capital planning tool is the Airport Layout Plan (ALP). During 2005, the Authority's ALP was
updated for planned and future improvements.
The effect any capital improvement program will have on future operating budgets is evaluated at the
time a specific project is authorized by the Authority and is undertaken on a cost-benefit analysis.
All current authorized capital projects scheduled for completion in 2006 have their projected
revenues and expenses incorporated into the Authority's 2006 operating budget.
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 from loss, theft, or misuse and
to ensure that adequate accounting data is compiled to allow for the preparation of finandal statements
in conformity with generally accepted accounting principles. The internal control structure is designed
to provide reasonable, but not absolute, assurance that these objectives are met. The concept of
reasonable assurance recognizes that: (1) the cost of a control should not exceed the bendits likely to be
derived; and (2) the valuation of costs and benefits requires estimates and judgments by management.
An annual budget is prepared in accordance with the Authority's By-laws. However, the Authority is
specifically exempt from the budget laws 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.
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INTRODUCTORY
CASH MANAGEMENT
All cash temporarily idle during 2005 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 ofthe Authority to eliminate or transfer risk ofloss where possible.
The Kansas Tort Claims Act (K.S.A. 75-6101 et seq.) generally limits tort lialbility for Kansas
governmental entities. The maximum liability for claims as specified by the Act is $500,000 for any
number of claims arising out of a single occurrence or accident. For wrongful acts, Kansas
governmental entities or their employees are exempted from liability.
The Authority carries $500,000 of comprehensive general liability insurance which matches the limit
established by the Kansas Tort Claims Act. During 2005 the Authority carried $18,773,922 of insurance
on airport commercial properties. The Authority also acquires construction builders' risk policies for all
major construction projects or requires evidence of coverage from the contractor.
The Authority's commercial property insurance included $1,739,452 in loss of rents coverage. All
contractors and lessees are required to carry amounts of property insurance with limits and deductibles
approved by the Authority. A schedule of insurance in force at December 31, 2005 is included in the
Supplemental Section of this report.
In addition, the Authority uses various risk management techniques. All contracts and leases are
reviewed by the Authority's legal counsel. All contractors and subcontractors are required to submit
evidence of insurance coverage naming the Salina Airport Authority and the City of Salina as named
additional insured.
GFOA CERTIFICATE OF ACHIEVEMENT
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a
Certificate of Achievement for Excellence in Financial Reporting to the Salina Airport Authority for its
comprehensive annual financial report (CAFR) for the fiscal year ended December 31, 2004. This was
the twelfth 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 report must satisfy both
generally accepted accounting principles and applicable legal requirements.
A Certificate of Achievement is valid for a period of one year only. We believe that our current
comprehensive annual financial report continues to meet the Certificate of Achievement Program's
requirements and we are submitting it to GFOA to determine its eligibility for another certificate.
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INTRODUCTORY
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 Infonnation Services, in the preparation of this report.
Respectfully submitted,
Tl~J6r-
Executive Director
Salina Airport Authority
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Michelle R. Swanson
Manager of Administration and Finance
Salina Airport Authority
cc: The City of Salina Board of Commissioners
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SALINA AIRPORT AUTHORITY
PRINCIPAL OFFICERS AS OF DECEMBER 31. 2005
BOARD OF DIRECTORS
Dr. Randy D. Hassler
Stephen C. Ryan
Donald E. Morris
Eric R. Hardman
Robert H. Miller
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
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SALINA AIRPORT AUTHORITY
Staff Members as of December 31. 2005
ADMINISTRATIVE STAFF
Timothy F. Rogers, A.A.E.
Michelle R. Swanson
Ryan E. Rocha, C.M.
Donald C. Kneubuhl
Kasey L. Fabrizius
Executive Director
Manager of Administration and Finance
Manager of Operations, Maintenance
and ARFF
Manager of Special Projects
Administrative Assistant
OPERATIONS, MAINTENANCE, AIRCRAFT RESCUE & FIRE FIGHTING STAFF
Ron Boyd
Loren Carleton
Roger K. Colby
Gary Hansen
Dale Mattison
David Nease
Rob Pejsha
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SALINA AIRPORT AUTHORITY
Organizational Chart
December 31,2005
CITIZENS OF SALINA
SALINA CITY COMMISSION
SAA BOARD OF DIRECTORS
Dr. Randy Hassler
Stephen C. Ryan
Donald E. Morris
Eric R. Hardman
Robert H. Miller
3/1/02 - 2/28/08
3/1/03 - 2/28/06
3/1/00 - 2/28/06
3/1/05 - 2/28/08
3/1/01 - 2/28/07
MANAGER OF ADMINISTRATION & FINANCE
Michelle Swanson
MANAGER OF SPECIAL PROJECTS
Donald C. Kneubuhl
ADMINISTRATIVE ASSISTANT
Kase L. Fabrizius
MANAGER OF OPERATIONS, MAINTENANCE & ARFF
R an E. Rocha C.M.
INTERN
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Certificate of
Achievement
for Excellence
in Financial
Reporting
Presented to
Salina Airport Authority,
Kansas
For its Comprehensive Annual
Financial Report
for the Fiscal Year Ended
December 31, 2004
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.
~tt7
President
~/~
Executive Director
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FINANCIAL SECTION
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A $4 million grant from the Federal A viation Administration
provided funding for the reconstruction of the Salina Airport's
(SLN) crosswind Runway 12/30. Following this
rehabilitation, SLN is better prepared to serve in its role as a
mid-continent fuel stop for over 7,000 business jets that use
the airport each year.
CLUBlNE&
RElTELE
CHAlITERED
Certified Public Accountants
(fI1
Robert I. Clubine, C.P .A.
David A. Rettele, C.P.A.
Jay D. Langley, C.P.A.
Jon K. Bell, C.P.A.
Leslie M. Corbett, C.P.A.
Stacy J. Sokol, C.P.A.
Marci K. Fox, C.P.A.
Delores K. Longenecker, C.P.A.
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, 2005 and 2004, as listed in the table of contents. These
financial statements are the responsibility of the Authority's management. Our
responsibility is to express an opinion on these financial statements based on our
audits.
We conducted our audits in accordance with auditing standards generally accepted
in the United States of America and the standards applicable to financial audits
contained in Government Auditing Standards, issued by the Comptroller General of
the United States and the Kansas Municipal Audit Guide, prescribed by the
Director of Accounts and Reports, Department of Administration of the State of
Kansas. Those standards require that we plan and perform the audit to obtain
reasonable assurance about whether the financial statements are free of material
misstatement. An audit includes examining, on a test basis, evidence supporting
the amounts and disclosures in the financial statements. An audit also includes
assessing the accounting principles used and significant estimates made by
management, as well as evaluating the overall financial statement presentation. We
believe that our audits provide a reasonable basis for our 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 31,2005 and 2004, and the changes in financial position and cash flows
for the years then ended in conformity with accounting principles generally
accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report
dated June 8, 2006, on our consideration of Salina Airport Authority's internal
control over financial reporting and our tests of its compliance with certain
provisions of laws, regulations, contracts, and grant agreements and other matters.
The purpose of that report is to describe the scope of our testing and internal
control over financial reporting and compliance and the results of that testing and
not to provide an opinion on the internal control over financial reporting or on
compliance. That report is an integral part of an audit performed in accordance
with Government Auditing Standards and should be considered in conjunction with
this report in considering the results of our audit.
The management's discussion and analysis on pages 17 through 23 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.
15
Our audit was conducted for the purpose of forming an opinion on the basic financial statements. The
Introductory Section and the accompanying schedules and additional information listed in the supplemental
information of the Financial Section and the Statistical Section ofthe table of contents are presented for
purposes of additional analysis and are not a required part of the basic financial statements of Salina Airport
Authority. 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 oIStates,
Local Governments, and Non-Profit Organizations, and is not a required part of the basic financial statements.
Such information has been subjected to the auditing procedures applied in the audit ofthe basic financial
statements and, in our opinion, is fairly stated in all material respects in relation to the basic financial
statements taken as a whole. The Introductory Section and the accompanying schedules and additional
information listed in the supplemental information of the Financial Section and the Statistical Section of the
table of contents has not been subjected to the auditing procedures applied in the audit of the basic financial
statements and, accordingly, we express no opinion on them.
CLUBINE AND RETTELE, CHARTERED
~~ (N~O ~
June 8, 2006
16
I 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 31,2005. 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 2005 having handled 86,292 aircraft operations.
This 6% increase in aircraft operations over the prior year was, in large part, attributable to the re-opening
of the Airport's primary runway, which was closed for three months in 2004. Over the past three years,
the Airport has undergone significant airfield runway construction projects requiring closures of major
runways and taxiways. The increase in aircraft operations in 2005 reflects a positive trend towards the
levels prior to 2003 and the airfield rehabilitation projects. Itinerant and local general aviation traffic
counts increased by 2% and 18%, respectively. Local military training flights decreased over the prior
year by 23% with itinerant military traffic also seeing a reduction at 14%. The Airport saw a significant
increase in the air carrier category as a result of increased air cargo flights refueling in Salina on cross-
country trips during the holiday season. The highest year for the most recent 1O-year period was 2002 at
95,801 aircraft operations. 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 caniers
attempting to serve rural communities such as Salina through the Department of Transportation's (DOT)
Essential Air Service Program. The Salina Municipal Airport continues to offer scheduled air service
provided by Air Midwest, a subsidiary of Mesa Air Group. Operating as USAirway Express, Air
Midwest continued to provide three daily flights to the Kansas City International Airport from Salina
during 2005. Since September 11, 2001, enplanements from the Salina Municipal Airport have remained
in the range of 2,300 to 2,900 per year.
The changes in the Authority's major airport activity indicators for the past three years aH: as follows:
2005 2004 2003
Enplanements - Scheduled Air Carrier 2,339 2,974 2,319
% increase / (decrease) -21.4% 28.2% -9.6%
Aircraft Operations - All Categories 86,292 81,465 86,214
% increase / (decrease) 5.9% -5.5% -10.0%
Fuel Flowage - (gallons delivered) 4,162,310 3,843,330 4,358,563
% increase / (decrease) 8.3% -11.8% -7.2%
Further airport activity data can be found in the Statistical Section of this report.
17
FINANCIAL
AIRPORT INDUSTRIAL CENTER ACTIVITY AND HIGHLIGHTS
The Authority owns nearly 900,000 sq. ft. of manufacturing, warehouse and office space at the Airport
Industrial Center. As further described herein, the building revenue generated by the Authority's leasing
activity constitutes a significant portion of the annual operating revenue budget. During 2005, building
rents equaled $858,106 or 46.2% of operating revenue. At the end of 2005, the Authority had leased all
tenantable space available in its building inventory.
SUMMARY OF OPERATIONS AND CHANGES IN NET ASSETS
Even with the uncertainty in the aviation industry and the slow growth in the economy, the fmancial
condition of the Authority has held steady in recent years. The Authority has effectivdy dealt with major
cost increases in employee health benefits including medical insurance premiums, utility costs,
commercial property insurance premiums and other operating expenses. Fortunately, with the diversified
revenue base, including building and land rental from the Authority's Industrial Center, total operating
revenue increased from 2004 to 2005.
Operating Revenues
Operating Expenses
2005
$ 1,857,370
(1,657,616)
2004
$ 1,412,120
(1,394,095)
2003
$ 1,387,297
(1,300,268)
Excess before Depreciation
and other non-operating
income and expenses
199,754
18,025
87,029
Depreciation
(1,392,316)
(1,151,664)
(1,022,474)
Excess (loss) before
other non-operating
income and expenses
(1,192,562)
(1,133,639)
(935,445)
Other Non-Operating Income
and (Expenses) net
801,924
814,744
772,257
Loss before
Capital Contributions
(390,638)
(318,895)
(163,188)
Capital Contributions
3,186,636
2,289,342
434,763
Increase in Net Assets
$ 2,795,998
$ 1,970,447
$ 271,575
18
FINANCIAL
SUMMARY OF OPERATIONS HIGHLIGHTS
Significant items effecting the Summary of Operations and Changes in Net Assets for 2005 are as follows:
. Operating revenues have remained steady in prior recent years, however, 2005 brought about a
significant increase of 31.5% over 2004. Increases in building rental revenue are attributable to
the leasing of one large industrial building and one professional office building that had been
vacant during 2004. Airfield revenue also increased during 2005 due to an increase of 10.4% in
fuel flowage fee revenue as a result of the Airport's primary runway being open for the entire year
following its 2004 reconstruction project. Additionally, hangar rental increased by 23.8% due to
the Authority's ability to lease space in two of its large aircraft hangars to visitllng military units
for training exercise and increased overnight transient aircraft.
· Operating expenses increased by 18.9% due to the following:
o Utility costs increased by 41.1 % over the prior year due to increases in ~mergy prices and
increased occupancy of the Authority's two large aircraft hangars.
o Increase in administrative expenses of 11.9% as a result of additional airport promotion
and special event expense as a result of the SLN Aviation Service Center promotion and
the Virgin Atlantic Globalflyer event.
o Building maintenance expense increased 67.3% or $23,233 as a result of increased
building and hangar occupancy.
· The net result of the above was operating income before depreciation increased by $181,729 from
2004. Depreciation expense increased due to new construction moving from construction in
progress to an asset in service. The significant item being the newly rehabilitated crosswind
runway.
· Non-operating income and (expenses) remained steady with a decrease of 1.6%. Ad-valorem tax
revenue (mill levy) received by the Authority as a local taxing entity increased by 2%, interest
received on investments and a financing lease decreased by $8,862 or 6.9% and interest expense
increased $26,067 or by 7.5%.
· Capital contributions received in the form of grants from the Federal Aviation Administration
increased from 2004 by $897,294.
19
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 $24,796,493 at the close of2005. A condensed summary of
the Authority's total net assets at December 31 is shown below.
2005 2004 2003
ASSETS
Current and other assets $ 3,085,722 $ 5,091,812 $ 3,676,007
Capital assets 32,941,504 27,968,139 24,954,889
Total assets 36,027,226 33,059,951 28,630,896
LIABILITIES
Long-term debt outstanding 7,732,664 8,485,351 6,246,510
Other liabilities 3,498,069 2,574,105 2,354,338
Total liabilities 11,230,733 11,059,456 8,600,848
NET ASSETS:
Invested in capital assets, 24,193,395 18,468,297 17,711,718
net of related debt
Restricted 85,000 85,000 85,000
Unrestricted 518,098 3,447,198 2,233,330
TOTAL NET ASSETS $ 24,796,493 $ 22,000,495 $ 20,030,048
By far the largest portion of the Authority's net assets (97.6%) 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.
20
FINANCIAL
REVENUES
The following chart shows the major sources and the percentage of total operating revenues for the year
ended December 31, 2005:
Gain (loss) on sale cI
assets
11%
Qher revenue
3%
a.ilding ax:! lax:!
rent
fS%
A summary of revenues for the past three years is shown below. Total revenue increased by 17.8% from
2004 to 2005. The increase is a result of increased building leasing activity and the sale of available land
for new development in the Airport Industrial Center.
2005 2004 2003
Operating Revenue:
Airfield $ 497,487 $ 439,672 $ 447,842
Building and land rent 1,106,146 890,631 916,585
Gain (loss) on sale of assets 204,083 59,943 (6,631 )
Other revenue 49,654 21,874 29,50 I
Total Operating 1,857,370 1,412,120 1,387,297
Non-Operating Income:
Mill Levy 1,058,688 1,036,579 987,970
Interest Income 118,087 126,949 128,640
Total Non-Operating 1,176,775 1,163,528 1,116,610
TOTAL REVENUE $ 3,034,145 $ 2,575,648 $ 2,503,907
Further detail regarding the Authority's operating revenue can be found in the Supplemental Section of
this report.
21
FINANCIAL
EXPENSES
The following chart shows the major expense categories and the percentage of total operating expenses for
the year ended December 31, 2005:
Maintenance
37%
A summary of expenses for the past three years is shown below. Total expenses increased by 16.2% from
2004 to 2005. The significant contributors to the change are increases in utility costs, equipment
maintenance, fuel expense and special events.
.....;
2005 2004 2003
Operating Expenses
Administrative $ 1,039,270 $ 928,679 $ 825,064
Maintenance 618,346 465,416 475,204
Total Operating 1,657,616 1,394,095 1,300,268
Non-Operating Expense
Interest Expense 355,270 331,505 324,500
Amortization of bond costs 19,581 17,279 19,853 .....
Total Non-Operating 374,851 348,784 344,353
TOTAL EXPENSES $ 2,032,467 $ 1,742,879 $ 1,644,621
Further detail regarding the Authority's operating expenses can be found in the Supplemental Section of
this report.
22
-----------
FINANCl4.L
CAPIT AL ACQUISITIONS AND CONSTRUCTION ACTIVITIES
The Authority expended $6,802,529 on capital activities during 2005. The most significant item was the
reconstruction of the Airport's cross-wind runway at a cost of $3,239,056. The next major item was the
rehabilitation of a 67,859 sq. ft. manufacturing facility in the Airport Industrial Center. The Authority also
acquired a new Aircraft Rescue and Firefighting vehicle at a cost of $607,423.
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 (D) in the notes to the financial statements and
within the Supplemental Section of this report.
DEBT ADMINISTRATION
The outstanding long-term debt of the Authority was $7,732,664 at December 31, 2005. 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 2020. 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 $3,635,000 in general obligation improvement
bonds during 2005. 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 requests for
additional information should be addressed to the Manager of Administration and Finance bye-mail:
shelliscc4salair.org or in writing to, Salina Airport Authority, 3237 Arnold Ave., Salina, KS 67401.
Respectfully submitted,
7~)~
Timothy F. Rogers, KA.E.
Executive Director
'f)~ K. c;l0()J~
Michelle R. Swanson
Manager of Administration and Finance
23
FINANCIAL
SALINA AIRPORT AUTHORITY
STATEMENTS OF NET ASSETS
ASSETS December 31
2005 2004
CURRENT ASSETS:
Cash $ 786,238 $ 2,962,020
Accounts receivable 265,850 107,053
Prepaid expenses 3,109 4,055
Taxes receivable 1,158,150 1,052,591
Total Current Assets 2,213,347 4,125,719
NONCURRENT ASSETS
Capital assets
Land
Buildings, improvements and equipment,
net of depreciation
Construction in progress
Total Noncurrent Assets
8,847,886 9,156,560
23,340,758 18,385,174
752,860 426,405
32,941,504 27,968,139
783,710 880,030
88,665 86,063
33,813,879 28,934,232
$36,027,226 $33,059,951
Total Capital Assets
Net investment in finance lease
Bond issue costs, less accumulated amortization
of$181,162 and $161,581 respectively
TOTAL ASSETS
( continued)
See notes to financial statements.
24
FINANCIAL
SALINA AIRPORT AUTHORITY
STATEMENTS OF NET ASSETS
(continued)
LIABILITIES AND NET ASSETS December 31
2005 2004
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
Unearned interest - financing lease
Current maturities of long-term debt
$ 22,828 $ 24,865
970,319 116,465
32,529 17,741
47,268 58,878
18,431 25,047
1,158,150 1,052,591
6,124 3,222
43,573 71,176
136,839 137,649
46,563 50,312
1,015,445 1,016,159
3,498,069 2,574,105
Total Current Liabilities
LONG-TERM LIABILITIES:
Bonds and note payable, less current maturities
Increase (decrease) in unearned rental income
Total Liabilities
7,732,664
8,485,351
11,230,733
11,059,456
NET ASSETS:
Invested in capital assets, net of related debt
Restricted, bond reserve funds
Unrestricted
Total Net Assets
24,193,395 18,468,297
85,000 85,000
518,098 3,447,198
24,796,493 22,000,495
$36,027,226 $33,059,951
=
TOTAL LIABILITIES AND NET ASSETS
See notes to financial statements.
25
FINANCIAL
SALINA AIRPORT AUTHORITY
STATEMENTS OF REVENUES, EXPENSES
AND CHANGES IN NET ASSETS
J anum"Y 1 to December 31
2005 2004
OPERATING REVENUES:
Airfield
Building and land rent
Gain (loss) on sale of assets
Other revenue
Total Operating Revenues
$ 497,487 $ 439,672
1,106,146 890,631
204,083 59,943
49,654 21,874
1,857,370 1,412,120
OPERATING EXPENSES
Administrative
Maintenance
DEPRECIATION
1,039,270 928,769
618,346 465,326
1,657,616 1,394,095
199,754 18,025
1,392,316 1,151,664
(1,192,562) (1,133,639)
Total Operating Expenses
OPERATING INCOME BEFORE DEPRECIATION
OPERATING LOSS
NON-OPERATING INCOME AND (EXPENSES)
Mill levy
Interest on deposits and financing lease
Interest expense
1,058,688 1,036,579
118,087 126,949
(374,851) (348,784 )
801,924 814,744
(390,638) (318,895)
3,186,636 2,289,342
Total Non-Operating Income and (Expenses)
LOSS BEFORE CAPITAL CONTRIBUTIONS
CAPITAL CONTRIBUTIONS
NET ASSETS
Increase in Net Assets
2,795,998
1,970,447
TOTAL NET ASSETS, beginning of year
22,000,495
20,030,048
TOTAL NET ASSETS, end of year
$24,796,493
$22,000,495
See notes to financial statements.
26
FINANCIAL
SALINA AIRPORT AUTHORITY
STATEMENTS OF CASH FLOWS
(DIRECT METHOD)
Januarv 1 to December 31
2005 2004
CASH FLOWS FROM OPERATING ACTIVITIES:
Cash received from providing services
Cash paid to employees for services
Cash paid to suppliers for goods and services
$ 2,107,817
(504,691)
(1,157,454)
Net Cash Provided in Operating Activities
445,672
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
Acquisition and construction of property, plant and equipment (5,948,674)
Purchases in satisfaction of maintenance agreement (1,350)
Proceeds from capital grants 3,186,636
Proceeds from property tax 1,058,688
Principal payments on debt (4,388,400)
Proceeds of new borrowing 3,635,000
Principal received on financing lease 96,320
Interest received on financing lease 93,126
Bond issue costs paid (22,183)
Interest paid on long-term debt (356,080)
Net Cash Provided (Used) in Capital and Related
Financing Activities
(2,646,917)
CASH FLOWS FROM INVESTING ACTIVITIES:
Interest received on deposits
25,463
INCREASE (DECREASE) IN CASH
(2,175,782)
CASH BALANCE - January 1
2,962,020
$ 786,238
CASH BALANCE - December 31
( continued)
See notes to financial statements.
$ 1,459,696
(472,178)
(871,435)
116,083
(4,126,043)
(5,863)
2,289,342
1,036,579
(988,922)
3,255,000
88,823
100,623
(6,147)
(294,691)
1,348,701
28,960
1,493,744
1,468,276
$ 2,962,020
27
FINANCIAL
SALINA AIRPORT AUTHORITY
ST A TEMENTS OF CASH FLOWS
(DIRECT METHOD)
( continued)
RECONCILIATION OF OPERATING LOSS TO NET
CASH FLOWS FROM OPERATING ACTIVITIES
January 1 to December 31
2005 2004
OPERATING LOSS
$(1,192,562)
$(1,133,639)
ADJUSTMENTS RECONCILING OPERATING LOSS
TO NET CASH FROM OPERATING ACTIVITIES:
Depreciation
Basis of assets sold
1,392,316
436,847
1,151,664
53,230
CHANGES IN ASSETS AND LIABILITIES:
Decrease (increase) in accounts receivable
Increase (decrease) in accounts payable - operations
Increase (decrease) in accrued payroll expenses
Decrease (increase) in prepaid expense
Increase ( decrease) in accrued property tax and special assessments
Increase (decrease) in unearned rental income
(158,797) 2,943
(2,037) 10,745
14,788 (5,198)
946 4,277
( 18,226) 1,949
(27,603) 30,112
$ 445,672 $ 116,083
NET CASH PROVIDED BY OPERATING ACTIVITIES
The Authority capitalized interest in the amount of$15,395 and $9,292 in 2005 and 2004 respectively.
See notes to financial statements.
28
FIN.-tNCIAL
Salina Airport Authority
NOTES TO FINANCIAL STATEMENTS
December 31, 2005
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 presented in the City's comprehensive
annual financial reports.
B. Measurement Focus, Basis of Accounting and Basis of Presentation
The Authority consists of an enterprise fund. Enterprise funds are classified as proprietary funds by the
GASB and are accounted for using a total economic resource measurement focus. The: enterprise fund is
used to account for operations that are financed and operated in a manner similar to private business
enterprises. The intent of the Authority is that the costs of providing services on a continuing basis be
recovered through user fees and rents. The financial statements are prepared on the accrual basis of
accounting. Under the accrual basis, revenues are recognized as earned and expenses as incurred. It is the
Authority's policy to follow all Financial Accounting Standards Board (FASB) standards issued after
November 30, 1989, for its proprietary activities unless those new F ASB pronouncements conflict with
GASB guidance.
The Authority has implemented the 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.
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.
C. Assets, Liabilities and Equity
1. Cash and Investments
The Authority's cash and cash equivalents are considered to be cash on hand, demand deposits and short-
term investments with original maturities of three months or less from date of acquisition. The Authority
held no investments during these years.
29
FINANCIAL
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 all1[axing entities within
the county. In accordance with state statutes, property taxes are levied November 1 of the current year and
are a revenue source to be used to finance the budget of the ensuing year. Om:-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 cun'ent year operations of the Authority. It is the Authority's
practice to record uncollected current year property tax as an account receivable and to record the same
amount as deferred revenue. It is not practicable to apportion delinquent taxes held by the County
Treasurer and, further, the amounts thereof are not material in relationship to the financial statements taken
as a whole.
3. Inventories
The Authority maintains no significant inventory of office and maintenance supplies. These items are
expensed as purchased and no inventory is recorded in these financial statements.
4. Prepaid items
Certain payments to vendors reflect costs applicable to future accounting periods and are recorded as
prepaid items.
5. Restricted Assets
Certain proceeds of leasehold revenue bonds are classified as restricted assets on the Statement of Net
Assets because their use is limited by applicable bond covenants.
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 earned as the related
allowable expenditures are incurred. Grants received under the AlP program are reported in the Statement
of Revenues, Expenses and Changes in Net Assets, as non-operating revenues and expenses as capital
contributions.
30
FINANCIAL
7. Capital Assets
Capital assets purchased or constructed are recorded at cost. The cost of normal maintenance and repairs
that do not add to the value of the assets or materially extend assets' lives are not included in capital assets
cost. Capital assets donated to the Authority are recorded at their estimated fair value at the date of
donation. Donated assets include property and equipment transferred to the Authority from the United
States of America, September 9, 1966 and recorded at fair value at that date. The Authority maintains a
capitalization threshold of $1 ,000.
Capital assets are depreciated using the straight-line method over the following estimated useful lives:
Assets
Buildings
Equipment
Vehicles
Airfield
Years
5 - 50
5 -10
7 -10
10 - 30
8. Compensated Absences
Substantially all full-time employees receive compensation for vacations, holidays, illness and certain
other qualifying absences. The number of days compensated for various categories of absence is generally
based on length of service. Liabilities relating to these absences are recognized as incurred and included in
accrued expenses. The amount accrued for such liabilities at December 31, 2005 and 2004 was $32,529
and $17,741 respectively.
II. STEWARDSHIP, COMPLIANCE AND ACCOUNT ABILITY
A. Cash-Basis Law (KSA 10-1113)
The Authority was in compliance with this law at all times during the year.
B. Depository Security (KSA 9-1402)
The Authority's funds were adequately secured at all times during the year.
31
FINANCIAL
III. DET AILED NOTES
A. Deposits
As of December 31, 2005 and 2004, the Authority had cash and cash equivalents as listed below:
December 31.
2005
2004
$ 2,962,020
(1,824)
34..237
Cash Balances
Cash
Less undeposited & petty cash
Add uncleared checks
$ 786,238
(120)
68.779
Bank Balance
854,897
2,994.,433
Less FDIC Coverage
(324.010)
(340.463 )
Balances Securable by Collateral
$ 530.887
$ 2.653.21Q
Security Provided by Depositories
$2.787.818
$ 8.766ill
The Authority did not have any activity in investment-type assets.
The Authority's policies relating to deposits and investments are governed by various Kansas Statutes
(KSA). Those statutes specify the type of deposits and investments as well as the securing of those
deposits and investments.
Interest rate risk - In accordance with Kansas Statute 12-1675, the Authority manages its exposure to
interest rate fluctuations by limiting all time investments to maturities of less than two years.
Credit risk - State law limits the amount of credit risk by restricting governments to specific investment
types as listed in KSA 12-1675. The Authority's policy is to place idle funds in ct:rtificates of deposit,
United States obligations, and the Kansas Municipal Investment Pool (KMIP). The KMIP was rated
AAAf/Sl+ by Standard & Poor's as of March 15, 2004. The KMIP is permittt:d to invest in fully
collateralized certificates of deposit, certain obligations of the United States, certain repurchase/reverse
repurchase agreements, and other types of investments. Maturity information released by the KMIP at
September 30, 2005 showed that the investment pool consisted of investment with a maturity date of 365
days or less.
Custodial credit risk - The Custodial credit risk for deposits is the risk that, in the event of the failure of a
depository financial institution, a government will not be able to recover deposits or will not be able to
recover collateral securities that are in the possession of an outside party. The custodial credit risk for
investments is the risk that, in the event of the failure of the counterparty to a transaction, a government
will not be able to recover the value of investment or collateral securities that are in the possession of an
outside party. Kansas Statutes 9-1402 and 9-1405 require that governments obtain security for all
deposits. The Authority manages its custodial credit risk by requiring the financial institutions to grant a
32
FINANCIAL
security interest in securities held by third-party custodial banks. Monies III the Kansas Municipal
Investment Pool are not required to have pledged securities.
Concentration of credit risk - This is the risk of loss attributed to the magnitude of a government's
investment in a single issuer. The Authority manages this risk by placing funds with financial institutions
only after contacting all eligible institutions in the taxing area and monies in the Kansas Municipal
Investment Pool are diverse according to the policies of the investment pool.
B. Receivables
Receivables as of year-end, including the applicable allowance for uncollectible accounts, are as follows:
December 31
2005
2004
Receivables:
Accounts
Less: allowance for uncollectibles
$ 267,568
(1.718)
265,850
1,158,150
$ 108,771
(1.718)
107,053
1.052.591
Taxes
Total
$1.424.000
$.1.159.644
C. Net Investment in Financing Lease
Net investment in financing lease is as follows:
December 31
2005
2004
Total lease payments receivable
Less: Unearned income
$1,136,676
352,966
$1,326,122
446,092
Net investment in financing leases
$ 783.710
.i 880.030
Activity in net investment in financing leases was as follows:
December 31
Beginning Balance
Less: Collected principal
Ending Balance
2005
$ 880,030
96.320
$ 783.710
2004
$ 968,853
88,823
.i 880.030
33
FliY,.NCIAL
D. Capital Assets
The following is a summary of the changes in capital assets during the current and preceding years.
Balance Balance
January 1, December 31,
Capital Assets 2005 Additions Dispositions Reclassin: 2005
Non-Depreciable
Land $ 9,156,559 $ 36,662 $ (359,097) $ 13,762 $ 8,847,886
Construction in progress 426.405 584.890 (258.436) 752.860
Total Non-Depreciable 9.582.964 621.552 059.097) (244.674) 9.600.746
Depreciable
Buildings and improvements 8,909,574 1,656,099 (122,537) 123,339 10.566.475
Airfield and improvements 21,643,118 3,717,273 121,335 25.481,726
Equipment 2.250.730 807.605 (312.220) 2.746.1 14
Total Depreciable 32.803.422 6.180.977 (434.757) 244.674 38.794.315
Total Non-Depreciable &
Depreciable $42.386.386 $6.802.529 $ (793.854) $ $48.395.061
Accumulated depreciation
Buildings and improvements (3,415,531 ) (324,167) 50,052 (3,689,646)
Airfield and improvements (9,709,161) (903,177) (10,612,338)
Equipment ( 1.293.555) (164.973) 306.955 (1.151.572)
Total Accumulated
Depreciation (14.418.247) ( 1.392.316) 357.007 (15.453.556)
Total Capital Assets $27.968.139 $ 5.410.213 $ (436.847) $ $32.941.504
34
FIi\~4NCIAL
Balance Balance
January 1, December 31,
Capital Assets 2004 Additions Dispositions Reclassifv 2004
Non-Depreciable
Land $ 9,107,226 $ 44,289 $ (52,003) $ 57,047 $ 9,156,559
Construction in progress 458.140 410.807 ( 442.542) 426.405
Total Non-Depreciable 9.565.366 455.096 (52.003) (385.495) 9.582.964
Depreciable
Buildings and improvements 7,937,403 917,709 54,462 8,909,574
Airfield and improvements 18,656,046 2,656,039 331,033 21,643,118
Equipment 2.085.149 189.300 (23.719) 2.250.730
Total Depreciable 28.678.598 3.763.048 (23.719) 385.495 32.803.422
Total Non-Depreciable &
Depreciable $38.243.964 $4.218.144 $ (75.722) $ $42.386.386
Accumulated depreciation
Buildings and improvements (3,164,659) (250.872) (3,415,531 )
Airfield and improvements (8,946,026) (763,135) (9,709,161)
Equipment 0.178.390) 037.657) 22.492 0.293.555)
Total Accumulated
Depreciation 03.289.075) 0.151.664 ) 22.492 (14.418.247)
Total Capital Assets $24.954.889 $ 3.066.480 $ 53.230 $ $27.968.139
E. Long- Term Liabilities
Following is a summary of changes in long-tenn liabilities during the CUlTent and preceding years.
Balance Balance
January 1, December 31,
2005 Additions Reductions 2005
Long-Term Liabilities
General obligations bonds
Revenue bonds
KDOCH loan payable
Special assessment debt
General obligation
Temporary notes
$5,435,000
170,000
165,593
475,917
$3,635,000
$ (850,000)
( 80,000)
( 54,103)
(149,298)
$8,220,000
90,000
111,490
326,619
3.255.000
(3.255.000)
Total Long-Term Liabilities
9.501.510
$3.635.000
$( 4.388.40 I)
8.748.109
Current maturities
0.016.159)
Q.015.445)
Long Term Liability Net
$8.485.351
$1.732.664
35
FINANCIAL
Long-Term Liabilities
General obligations bonds
Revenue bonds
KDOCH loan payable
Special assessment debt
General obligation
Temporary notes
Total Long-Term Liabilities
Current maturities
Long-Term Liabilities Net
Balance
January 1,
2004
$6,265,000
245,000
218,629
506,804
7.235,433
(988,923 )
$6.246.510
Additions
Balance
December 31,
Reductions 2004
$
$ 830,000
75,000
53,036
30,887
$5,435,000
170,000
165,593
475,917
3.255.000
3.255,000
$3.255.000
$ 988.923
9,501.510
(1.016,159)
$8.485.351
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 200 I-A, due 2012
General Obligation 2002-A, due 2012
General Obligation 2005-A, due 2020
Revenue Bonds
Leasehold revenue 1991, due 2006
Kansas Department of Commerce
and Housing Loan, due 2007
Special assessment debt, due 2016
Total
Interest expense in 2005 is as follows:
General obligation bonds
Revenue bonds
Loan (KDOCH)
Special assessment debt
Temporary note
Add: Amortization of bonds costs
Total
Original Interest Bonds
Issue Rates putstandin2
$4,440,000 4.05% to 5.50% $1,325,000
555,000 3.90% to 5.20% 280,000
1,385,000 4.45% to 5.60% 1,050,000
2,635,000 2.45% to 3.70% 1,930,000
3,635,000 4.75% to 5.25% 3,635,000
8,220,000
$ 850,000 5.00% to 7.25% 90,000
$ 468,542 2% 111,490
$ 565,235 3.79% 326,619
$8.748.109
$ 278,066
12,286
3,034
18,038
43,846
355,270
19.581
$ 374.851
36
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 31,2005, $125,000 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 Outstandin2 Due Total
2006 $ 850,000 $ 386,931 $ Il,236,931
2007 885,000 339,533 Jl,224,533
2008 905,000 304,716 Jl,209,716
2009 710,000 267,626 977,626
2010 750,000 236,158 986,158
2011-2020 4.120,000 1 ,008,045 5.128,045
$8.220.000 $2.543.009 $.10.763.009
Annual debt service requirements to maturity for revenue bonds to be paid with rental revenues:
Year
Bonds
Outstandin2
Interest
Due
Total
2006
$ 90.000
$ 6.525
L 96,525
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
2006 $ 55,184 $ 1,955 $ 57,139
2007 56,306 846 57.1 46
$ 111.490 $ 2.801 Ll14.285
37
FINANCIAL
Annual debt service requirement to maturity for Special Assessment Debt to be paid from rental revenue:
Loan Interest
Year Principal Due Tot:!!!
2006 $ 24,483 $ 12,380 $ 36,863
2007 25,411 11,452 36,863
2008 26,374 10,489 36,863
2009 27,374 9,488 36,862
2010 28,412 8,450 36,862
2011-2016 194.564 26.609 ~170
$326.619 $ 78.868 ~18.3.
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 2005 2004
Federal $ 19,498,087 $ 3,186,636 $ 2,289,342
State 515.610
Total $20.013.697 $ 3.186.636 $ 2.289.342
The Authority designated $90,000 to be used as an insurance increase reserve or to accelerate future debt
service payments. As of December 31, 2005, the reserve had been funded but not used.
IV. OTHER INFORMATION
A. Defined Benefit Pension Plan
Plan description - The Authority participates in the Kansas Public Employees Retirement System
(KPERS). The plan is a cost-sharing multiple-employer defined benefit pension plan as provided by
Kansas statutes (KSA 74-4901 et seq). KPERS provides retirement benefits, life insurance, disability
income benefits and death benefits. Kansas law establishes and amends benefit provisions. KPERS issues
a publicly available financial report that includes financial statements and required supplementary
information. Those reports may be obtained by writing to KPERS (611 S. Kansas Avenue, Suite 100,
Topeka, Kansas 66603-3803) or by calling 1 (888) 275-5737
Funding policy - KSA 74-4919 establishes the KPERS member-employee contribution rate at 4% of
covered salary. The employer collects and remits member-employee contributions according to the
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 2005 was 4.01 % from January
1 - June 30 and 4.21 % from July 1 - December 31. The Authority employer contributions to KPERS for
38
FIN.4.NCIAL
the years ending December 31, 2005, 2004 and 2003 were $18,532, $15,236, and $14,490 respectively,
equal to the required contributions for each year.
B. Deferred Compensation Plan
The Authority offers its employees a deferred compensation plan ("Plan") created in accordance with
Internal Revenue Code Section 457. The Plan, available to all Authority employees, permits them to defer
a portion of their salary until future years. The deferred compensation is not available Ito 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 (1.R.e. Section 125)
The Authority has adopted by resolution a salary-reduction flexible benefit plan ("Plan") under Section
125 of the Internal Revenue Code. All Authority employees working more than 20 hours per week are
eligible to participate in the Plan beginning after thirty days of employment. Each participant may elect to
reduce his or her salary to purchase benefits offered through the Plan. Benefits offered through the Plan
include various insurance and disability benefits.
D. Risk Management
The Authority is exposed to various levels of loss related to torts; theft of, damage to, and destruction of
assets; errors and omissions; injuries to employees; and natural disasters.
There has been no significant reduction in the Authority's insurance coverage from the previous year. In
addition, there have not been settlements in excess of the Authority's coverage in any of the prior three
years.
E. Contingent Liabilities
The Authority receives significant financial assistance from numerous federal and state governmental
agencies in the form of grants and state pass-through aid. The disbursement of funds received under these
programs generally requires compliance with terms and conditions specified in the grant agreements and is
subject to audit. Any disallowed claims resulting from such audits could become a liability of the
Authority. However, in the opinion of management, any such disallowed claims would not have a
material effect on any of the financial statements of the Authority at December 31, 2005.
F. Environmental Matter
The U.S. Government Department of Defense transferred property located at the fonner Schilling Air
Force Base to the Authority September 9, 1966. The property is now known to contain areas of extensive
soil and groundwater contamination, primarily from the use and disposal of chlorinated solvents and
petroleum products caused by activities at the former base during its period of active military duty from
1942 to 1965.
The U.S. Government Department of Defense is responsible for the investigation and remediation of
contamination caused by military activities at current and former military bases. The U.S. Army Corps of
Engineers is the lead agency for the Department at formerly used defense sites. The Corps is currently
39
FINANCIAL
investigating contamination at the former base under the regulatory oversight of the u.s. Environmental
Protection Agency and the Kansas Department of Health and Environment. The former base is not
designated as a National Priority List Superfund site, but investigation and remediation is required to be in
compliance with the Comprehensive Environmental Response, Compensation and Liability Act.
Potential liability for contamination under the Act extends broadly to parties associated with the release or
presence of hazardous substances, including not only those entities involved with c:ontaminant use and
disposal, but in some cases other current and former owners and operators of contaminated sites. As a
current owner of extensive amounts of property at the former base, the Authority is potentially liable under
the act.
The Authority has determined that while a possible liability exists, it is not probable: and at this time no
reasonable estimate of the possible liability can be made. Therefore, no liability relating to that matter has
been recorded. The Authority is under no administrative orders from the U.S. Environmental Protection
Agency or the Kansas Department of Health and Environment. The Authority is considered to be a
Potentially Responsible Party for the former base site, primarily due to its status as a property owner.
G. Rental Income Under Operating Leases
A significant portion of the operating revenue of the Authority is generated through the leasing of
airport and building space to airport fixed base operators and others on a fixed fee as well as a
contingent rental basis. Ownership risks are retained by the Authority, and accordingly, such leases are
treated as operating leases.
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
2006
2007
2008
2009
2010
Later years
$1,120,265.88
1,073,872.88
927,446.30
778,822.10
725,316.60
2,922,309.00
Total
$7.548.032.76
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
Kansas Army National Guard. Rent from these six tenants equals 62% of operating and capital lease
revenue for the year ended December 31, 2005.
40
FINANCl4.L
I. Non-Operating Income and (Expense)
Net non-operating income and expense consisted of the following for the years ended December 31, 2005
and 2004:
Mill levy
Interest and investment income
Financing lease
Other interest
Totals
2005
$1,058,688
2004
$ 1,036,579
92,624
25.463
$1,176,775
97,989
28,960
$ 1,163,528
Interest expense
Revenue bond
General obligation bonds
Special assessment debt
Loan (KDOCH)
Temporary Note
Amortization of bond issue costs
Totals
Net non-operating income
(12,286)
(278,066)
(18,038)
(3,034)
(43,846)
(19,581)
(374,851)
$ 801.924
( 12,286)
(238,054)
(18,038)
(3,886)
(59,241)
(17,279)
(348,784)
$ 814.744
J. Commitment Under Operating Lease
The Authority has entered into certain non-cancellable operating lease agreements which will expire in
2008, for the rental of office equipment. Minimum rentals, on an annual basis are as follows:
Years Ended
December 31
2006
2007
2008
Total
$ 6,180
5,578
2,918
$ 14.676
41
(THIS P AGE INTENTIONALLY LEFT BLANK)
42
~
SUPPLEMENTAL INFORMA TION
......
~l' '<'~'1ri~fn
~~J ., viCenter
...~~.. .~~
>,;;:. ". ,>,. "
During 2005, the primary growth area for the SLN Aviation
Service Center was identified and work began on the scope
of redevelopment of over 90 acres of the Airport's north
ramp. The SLN A viation Service Center continues to be an
excellent location for aircraft maintenance, repair and
overhaul businesses.
(THIS P AGE INTENTIONALLY LEFT BLANK)
43
SUPPLEMENTAL
SALINA AIRPORT AUTHORITY
SCHEDULES OF REVENUES, EXPENSES AND CHANGES
IN NET ASSETS
January 1 to December 31
2005 2004
OPERATING REVENUES
Airfield
Fuel flowage fees $ 259,981 $ 235,362
Hangar rent 168,034 135,785
Landing fees 5,358 5,950
Ramp rent 64,114 62,575
Total Airfield 497,487 439,672
Building and land rent
Agri land rent 51,588 53,792
Building rents 858,106 609,791
Land rents 187,332: 218,980
Tank rent 9,120 8,068
Total Building and Land Rents 1,106,146 890,631
Gain (loss) on sale of assets 204,083 59,943
Other revenue
ARFF training 14,425 4,400
Commissions 13,321 12,574
Other income 21,908 4,900
Total Other Revenue 49,654 21,874
-
Total Operating Revenue 1,857,370 1,412,120
( continued)
44
SUPPLEil-tENTAL
SALINA AIRPORT AUTHORITY
SCHEDULES OF REVENUES, EXPENSES AND CHANGES
IN NET ASSETS
( continued)
OPERATING EXPENSES
Administrative
AlE, consultants, brokers
Airport promotion
Bad debt expense
Computer network administration
Dues and subscriptions
Employee retirement
FICA and medicare
Industrial development
Insurance, property
Insurance, medical
Kansas unemployment tax
Legal and accounting
Office salaries
Office supplies
Other administrative
Postage
Property appraisals
Property taxes
Special events
Telephone
Travel and meetings
13,950
22,234
27,914
26,840
38,709
5,493
16,700
15,236
34,018
20,000
131,240
108,495
448
35,095
244,312
12,457
18,560
4,697
9,532
16,347
37,532
36,345
20,000
137,494
116,724
623
44,557
268,263
13,300
15,133
4,850
1,200
126,408
120,300
1l,033
23,445
144,176
12,583
9,534
22,262
Total Administrative Expenses
1,039,270
928,769
( continued)
45
SUPPLEi).fENTAL
SALINA AIRPORT AUTHORITY
SCHEDULES OF REVENUES, EXPENSES AND CHANGES
IN NET ASSETS
( continued)
January lito December 31
2005 2004
16,885 7,761
5,770 5,731
57,457 38,355
57,732 34,499
15,247 11,455
8,555 7,397
251,216 222,668
23,683 13,554
26,819 14,102
154,982 109,804
618,346 465,326
1,657,616 1,394,095
199,754 18,025
1,392,316 1,151,664
(1,192,562 ) (1,133,639)
1,058,688 1,036,579
92,624 97,989
25,463 28,960
(355,270) (331,505)
(19,581) (17,279)
801,924 814,744
(390,638) (318,895)
3,186,636 2,289,342
2,795,998 1,970,447
22,000,495 20,030,048
$24,796,493 $22,000,495
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 Maintenance Expenses
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
46
SUPPLEMENTAL
SALINA AIRPORT AUTHORITY
CAPITAL EXPENDITURES
January 1 to December 31
~005
AIRPORT IMPROVEMENTS
Airport Layout Plan update finalize
Rwy 17/35 design
Rwy 17/35 construction AIP-22
Rwy 12/30 rehab design
AIP-25-Rwy 12/30 rehab construction
Rwy 12/30 rehab design
Air traffic control-Airspace study
Concrete parking pad-Bldg. 207 16'x80'
GA ramp repairs
Water service line Hgr 504-506
Taxiway Alpha shoulder design
Airfield perimeter fencing
$ 462
2,900
209,202
122,322
3,239,056
52,061
23,250
4,768
26,985
1 1,682
5,862
18,723
Total Airport Improvements
3,717,273
BUILDINGS
Water service line Bldg 512
Facility imp. Bldg 1021 AlE
Bldg 1021 imp. construction
Trailer parking KSARNG
Hollow metal door & jam Hgr 509
Light fixtures Hgr 703
Light fixtures Hgr 509
200 amp service
Sidewalk w/handicap ramp Bldg 394
Motion light Hgr 509 2 each
Computer equip. room Bldg 528
Boiler draft inducer Bldg 939
Electric service Hgr P6/P 13
UST cathodic protection system PH 305
Veeder Root replacement probes PH 305
100 amp single service North ramp
Water service line Airport Road
1021 loading dock
Capitalize interest Bldg 1021
9,002
43,671
1,508,457
23,912
1,630
5,680
5,380
875
1,483
1,145
10,908
1,021
2,170
24,345
1,870
1,437
1,579
6,609
6,795
Total Buildings
1,6:57,969
(continued)
47
SUPPLEMENTAL
SALINA AIRPORT AUTHORITY
CAPITAL EXPENDITURES
( continued)
January 1 to December 31
2005
CONSTRUCTION IN PROGRESS
Textile break-arresting barrier design
North Central KS radar feasibility study
Executive hangar design
CSC design Flower Aviation
FBO customer service center. Bldg 700
CSC site improvements
Apron acquisition KSU
Spill prevention control & countermeasures
Foreign trade zone
Interest capitalized Bldg 700
6,884
30,018
34,808
4,794
429,575
62,215
2,475
2,284
3,237
8,600
Total Construction in Progress
584,890
EQUIPMENT
2004 Rosenbauer HP Panther ARFF vehicle
Portable lighted runway closure markers 2 each
Security panels 21 each
Passageway turnstile
Gate access control system
Gas heaters Hgr. 703
Electric recepticals Hgr. 703
UST meter monitors Pump house 305
VHF mobile radio, power supply, 3 headsets
HP laptop computer, sonic firewall VPN
Lightbars & strobes OPS vehicles
42' Sony Plasma Monitor
Carousel organizer for Exec. Dir. Office
1991 Boom truck
Emergency generator
Conference room phones
Snow plow hitches 4 each
2005-Dodge Dakota #2 sn 6136
Veri com runway friction meter
Radios and lights for airport ops vehicle #3
2005-Dodge Dakota #3 sn 6137
2005-Dodge Dakota #4 sn 6134
2005-Dodge Dakota #5 sn 6135
Land Pride mower drive shaft
Underground utility locator
607,423
39,498
1,044
3,799
17,717
4,006
2,250
1,376
2,403
3,592
8,303
2,247
1,287
14,174
1,383
1,657
2,550
19,701
4,102
1,227
19,701
19,701
19,701
1,250
5,642
Total Equipment
805,734
( continued)
48
SUPPLEMENTAL
SALINA AIRPORT AUTHORITY
CAPITAL EXPENDITURES
( continued)
January 1 to December 31
~~005
LAND
2005 environmental
36,662
Total Land
36,662
$ 6,802,528
TOT AL CAPITAL EXPENDITURES
49
SUPPLEMENTAL
SALINA AIRPORT AUTHORITY
GENERAL OBLIGATION BONDS
SERIES 1998 - A
December 31, 2005
Date of issue:
Amount of issue:
Interest rate:
Maurity date:
Principal paid:
Outstanding balance:
June 29, 1998
$4,440,000
4.05% to 5.50%
September 1, 2008
$3,115,000
$1,325,000
Schedule of Bond Interest and Principal Payments
Due in Bond Bond
Year Interest Principal
2006 $ 56,972 $ 445,000
2007 38,060 440,000
2008 19,140 440,000
$114,172 $1,325,000
50
SUPPLEMENTAL
Date of isue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGA nON REFUNDING BONDS
SERIES 1999 - B
December 31, 2005
June 29, 1999
$ 555,000
3.90% to 5.20%
September 1, 2010
$ 275,000
$ 280,000
Schedule of Bond Interest and Princi9al Payments
Due in Bond Bond
Year Interest Principal
2006 $ 14,032 $ 30,000
2007 12,623 55,000
2008 9,955 60,000
2009 6,955 65,000
2010 3,640 70,000
$ 47,205 $ 280,000
51
SU PLEMENT AL
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGATION IMPROVEMENT BONDS
SERIES 2001 - A
December 31, 2005
October 31, 2001
$ 1,385,000
4.45% to 5.60%
September 1, 2012
$ 335,000
$ 1,050,000
Schedule of Bond Interest and Principal Payments
Due in Bond Bond
Year Interest Principal
2006 $ 54,222 $ 125,000
2007 48,660 135,000
2008 42,316 140,000
2009 35,316 150,000
2010 27,514 160,000
2011 18,867 165,000
2012 9,800 175,000
$236,695 $ 1,050,000
52
SUPPLEil:1ENTAL
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLlGA nON IMPROVEMENT BONDS
SERIES 2002 - A
December 31, 2005
August 29, 2002
$ 2,635,000
2.45% to 3.70%
September I, 2012
$ 705,000
$ 1,930,000
Schedule of Bond Interest and Principal Payments
Due in Bond Bond
Year Interest Principal
2006 $ 61,640 $ 250,000
2007 55,515 255,000
2008 48,630 265,000
2009 40,680 275,000
2010 31,880 285,000
2011 21,905 295,000
2012 11,285 305,000
$271,535 $ 1,930,000
53
SUPPLEMENTAL
Date of issue:
Amount of issue:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
SALINA AIRPORT AUTHORITY
GENERAL OBLIGA nON IMPROVEMENT BONDS
SERIES 2005 - A
December 31, 2005
Schedule of Bond Interest and Principal Payments
Due in
Year
Bond
Interest
2006
2007
2008
2009
2010
2011
2012-2020
$ 200,065
184,675
184,675
184,675
173,124
160,787
785,40 I
$ 1,873,402
August I, 2005
$ 3,635,000
4.75% to 5.25%
September I, 2020
$
$ 3,635,000
Bond
Principal
$
220,000
235,000
245,000
2,935,000
$ 3,635,000
54
SUPPLEMENTAL
SALINA AIRPORT AUTHORITY
LEASEHOLD REVENUE BONDS
SERIES 1991
December 31, 2005
Date of issue:
Amount of issue:
Interest rate:
Maturity rate:
Principal paid:
Outstanding balance:
November 1, 1991
$ 850,000
5.00% to 7.25%
September I, 2006
$ 760,000
$ 90,000
Schedule of Bond Interest and Principal Payments
Due in Bond Bond
Year Interest Principal
2006 $ 6,525 $ 90,000
$ 6,525 $ 90,000
=
55
SUPPLEMENTAL
SALINA AIRPORT AUTHORITY
KANSAS DEPARTMENT OF COMMERCE AND HOUSING, LOAN PAYABLE
December 31, 2005
Date of loan:
Amount of loan:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
October 1, 1997
$ 468,542
2%
October 1,2007
$ 357,058
$111,484
Schedule of Loan Interest and Principal Payments
Due in Loan Loan
Year Interest Principal
2006 $ 1,955 $ 55,184
2007 846 56,300
$ 2,801 $ 111,484
56
SUPPLEMENTAL
SALINA AIRPORT AUTHORITY
SPECIAL ASSESMENT DEBT -STREET AND UTILITY IMPROVEMENT
December 31, 2005
Date of loan:
September 11, 2002
I $ 415,933
3.79%
October 1,2016
$ 89,314
$ 326,619
Amount of loan:
Interest rate:
Maturity date:
Principal paid:
Outstanding balance:
Schedule of Loan Interest and Principal Payments
Due in Loan Loan
Year Interest Principal
2006 12,380 24,483
2007 11,451 25,412
2008 10,489 26,374
2009 9,488 27,374
2010-2014 31,070 153,242
2015-2016 3,990 69,734
$ 78,868 $ 326,619
1 - Original Special Assessment Debt was $563,235.
Special Assessment Debt for two tracts within the benefit district
was assumed by the party purchasing the land during 2005.
57
SlrpPLEJIENTAL
Insurance Policv
Employers Insurance of Wausau
on behalf ofUSAIG
Pol. #WCC-Z9l-547496-0l5
National Union Fire Ins. Co. of
Pittsburgh, P A
Pol. #AP3229456-l1
Chubb Group of Insurance Companies
Pol. #3581-68-04 KCO
Pol. #(05) 7353-33-80
Pol. #3581-68-04 KCO
ITT Hartford
Pol. #37BPEAG4896
Gemini Insurance Company
Pol. #UGP0000208-00
Great American Alliance Ins. Co.
Pol. # KST 788-29-33-11
Gemini Insurance Company
Pol. #UGLOOOOOI5-01
SALINA AIRPORT AUTHORITY
INSURANCE IN FORCE
December 31, 2005
Tvpe of Covera2:e
Amount of
Coverage
Workmen's Compensation
and Employer's Liability
$ 500,000
Bodily Injury & Liability
Hangar Keepers
$ 500,000
$ 500,000
Deluxe Property-Buildings, business personal
prope11y and equipment breakdown (including
boiler and machinery)
Business Income
$18,773,922
$ 1,739,452
Vehicles & Equipment
Liability $ 1,000,000
Medical payments $ 5,000
Uninsured motorists $ 1,000,000
Inland Marine - Equipment $ 1,994,141
Crime Policy
Employee theft - per employee $ 100,000
Public Officials and Employment Practices Liability
Each wrongful act $ 1,000,000
Aggregate limit $ 2,000,000
Kansas Underground Storage Tank Liability
Environmental Incident
Annual aggregate
Limit of defense
$ 1,000,000
$ 1,000,000
$ 100,000
Law Enforcement Professional Liability
Each person
Each wrongful act
Annual aggregate
$ 1,000,000
$ 1,000,000
$ 1,000,000
58
STA TIS TICAL SECTION
....,..
....,...
~
~
The two nationally ranked Fixed Base Operators (FBO's) at
the Salina Airport delivered over 4 million gallons of fuel to
users of the Airport during 2005. Known as "America's Fuel
Stop", SLN continues to be a favorite mid-continent refueling
location for general aviation.
Salina Airport Authority
OPERATING REVENUE HISTORY
Ten Years Ended December 31,2005
Gain (Loss) Other Total
Fiscal Rental Fuel Flowage Landing on Sale of Operating Operating
Year Revenue Fees Fees Assets Receipts Revenue
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
2004 $1,088,991 $235,362 $5,950 $59,943 $21,874 $1,412,120
2005 $1,338,295 $259,981 $5,358 $204,083 $49,654 $1,857,371
Source: Salina Airport Authority Records
VI
\0
STA TISTICAL
Salina Airport Authority
OPERATING EXPENSE HISTORY
Ten Years Ended December 31,2005
Office & Total
Administrative Maintenance Operating
Fiscal Year Expense Expense Expense
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
2004 $928,679 $465,416 $1,394,095
2005 $1,039,270 $618,346 $1,657,616
60
STA TlSTlCAL
Salina Airport Authority
FEDERAL FINANCIAL ASSISTANCE HISTORY
Ten Years Ended December 31,2005
Fiscal Year
Federal Aviation
Administration
Airport
Imorovement Grants
State Commerce &
Housing
Community Development
Block Grant
1996
$2,006,786
1997
$1,640,967
1998
$1,026,918
$841,700
1999
($7,920)
$189,520
2000
2001
2002
$144,005
2003
$434,763
2004
$2,289,342
2005
$3,186,636
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.
61
Salina Airport Authority
CAPITAL EXPENDITURE HISTORY
Ten Years Ended December 31, 2005
Construction Total
Fiscal Building in Capital
Year Eauipment Additions Land Infrastructure Airfield Proe:ress Expenditures
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
2004 $189,300 $917,709 $44,289 $2,656,039 $410,807 $4,218,144
2005 $807,605 $1,656,099 $36,662 $3,717,273 $584,890 $6,802,529
Source: Salina Airport Authority Records
0\
N
STA TISTICAL
Salina Airport Authority
REVENUE BOND COVERAGE
Ten Years Ended December 31,2005
Fiscal Pledged Revenue Bond
Year Revenue Debt Service Covera2e
1996 $189,446 $163,790 1.16
1997 $189,446 $168,962 1.12
1998 $189,446 $163,938 1.16
1999 $189,446 $163,841 1.16
2000 $189,446 $185,013 1.02
2001 $189,446 $164,420 1.15
2002 $189,446 $158,320 1.20
2003 $189,446 $151,923 1.25
2004 $189,446 $150,283 1.26
2005 $189,446 $148,158 1.28
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
63
STA TISTICAL
Salina Airport Authority
Principal Customers
Year Ended December 31,2005
Company
Revenue
% of Operating & Direct
Finance l,ease Revenue
Kansas Military Board - KS Army National
Guard
Raytheon Aircraft Co.
Kansas State University at Salina
JRM Enterprises, Inc, d/b/a America Jet
Flower Aviation
The Schwan Food Company
Two Rivers Vending Co., Inc.
Geocore Services
Aerospace Systems & Technologies, Inc.
Federal Aviation Administration
Ballard Aviation d/b/a EagleMed
Kejr, Joe
Builders Choice Concrete
Professional Flight Training, LC
Waddle's Manufacturing & Machine
United Suppliers, Inc.
Hertz Corporation
WWC License LLC
Laas, Brent and Mark
AcuStep, Inc.
Triangle Trucking
Bostater Realty, Inc.
Palmer Trucking Co.,
Salina Auto Auction
Scrommel Resource Management, Inc.
Mesa Airlines/Air Midwest
Salina Snack Sales
Scientific Engineering
Blue Beacon International
Land of OZ Meats
$272,770
240,218
229,170
167,786
149,637
83,844
49,912
37,920
34,270
22,988
22,800
18,442
18,208
16,863
16,580
15,984
15,570
13,666
13,430
13,205
12,732
12,370
12,300
12,169
11,916
10,640
9,720
8,700
8,492
8,340
14.80%
13.04%
12.44%
9.11%
8.12%
4.55%
2.71%
2.06%
1.86%
1.25%
1.24%
1.00%
0.99%
0.92%
0.90%
0.87%
0.84%
0.74%
0.73%
0.72%
0.69%
0.67%
0.67%
0.66%
0.65%
0.58%
0.53%
0.47%
0.46%
0.45%
Total Operating Lease and Direct Finance Lease Revenue for 2005 was $1,842,733
Source: Salina Airport Authority Records
64
Salina Airport Authority
LOCAL GOVERNMENT MILL LEVY RATES, DIRECT AND OVERLAPPING
Ten Years Ended December 31, 2005
Other
Unified Salina State Special
Fiscal Saline City of School Airport of Taxing
Year Countv Salina Dist. #305 Authoritv Kansas Districts Total
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
2004 28.874 24.063 59.666 2.795 1.5 6.689 123.587
2005 28.579 23.999 55.182 2.941 1.5 6.519 118.720
Note:
Funds generated from the Salina Airport Authority's 2005 mill levy become available during calendar year 2006 and are budgeted accordingly.
Source: Saline County Clerk
0"\
\J1
STATISTICAL
Salina Airport Authority
MILL LEVY REVENUE
Ten Years Ended December 31,2005
Fiscal Year
Mill Levy
Revenue
1996
$357,887
1997
$338,058
1998
$322,270
1999
$783,363
2000
$801,237
2001
$795,404
2002
$817,499
2003
$987,970
2004
$1,036,579
2005
$1,058,688
Source: Salina Airport Authority Records
66
STATISTICAL
Salina Airport Authority
AIR TRAFFIC, FUEL FLOWAGE AND ENPLANEMENT TRENDS
Ten Years Ended December 31, 2005
Scheduled
Fiscal Air Traffic Fuel Flowage Air Service
Year Operations Gallons EIllPlanements
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
2004 81,465 3,843,330 2,974
2005 86,292 4,162,887 2,339
Note:
One air traffic operation equals one aircraft takeoff and landing
Source: Salina Airport Authority Records
67
STA TISTICAL
Salina Airport Authority
MAJOR EMPLOYERS IN THE SALINA/SALINE COUNTY AREA
December 31, 2005
Maior Private Employers
Company
Approx. #
Employees
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
KASAlKASA Fab
Lowe's Home Improvement
Exline
Salina Journal
Sunflower Bank
Premier Pneumatics
Blue Beacon Int'l
PKM Steel
1,850
1,082
800
650
600
300
420
357
255
183
160
150
150
140
140
130
130
120
115
104
100
Maior Public Employers
Public Or2anizations
Approx. #
Employees
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
Farm 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
68
STATISTICAL
Salina Airport Authority
SALINE COUNTY POPULATION, DEMOGRAPHIC AND LABOR STATISTICS
Year Population
1996 53,140 III
't'
1997 53,168 c
l\l
1998 53,182 III
::::l
0
1999 53,485 .r.
I-
2000* 53,597
2001 53,804
2002 53,933
2003 53,743
2004 53,903
2005 53,919
Saline County Population
54,000
53,500
53,000
52,500
AO ~ ,.{b p'>OJ s5 1:)" 1:)'1.- I:)~ ~ I:)~
~J "C!l ,,~J "C!l r5>t;;'j ~ ~ ~ ~ ~
Year
~---
~
Note: * Indicates decennial census 100% population counts. Other counts are population estimates.
Demoeraphics
Median Age (2000)
Housing Units (2004)
Median Household Income (2003)
Per Capita Income (2003)
Employment and Civilian Labor Force
Year
Civilian Labor
Force
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
29,966
30,178
30,420
30,904
29,119
30,072
30,255
30,735
30,800
31,293
36.1
23,240
$38,206
$27 ,579
Employed
28,800
29,082
29,365
30,142
28,206
28,953
29,015
29,321
29,312
29,925
(Annual Average)
Unemployed
Employment and Civilian Labor Force
1,166
1,096
1,055
762
913
1,119
1,240
1,414
1,488
1,368
n.ooo_
31,000 .., .
30,000
29,000
28,000
27,000
26,000
PJ~ ~ ...~ PJ~ ~~ ...~" ~~"" ~~~ ...~ ~~~
~ ~-~ ~ 'V ~ ~ 'V ~ ~
Souces: Sources: Institute for Public Policy and Business Research
U.S. Bureau of Labor Statistics
69
STATISTICAL
Salina Airport Authority
SALINE COUNTY EMPLOYMENT DATA
Annual Averal!e Unemoloyment - 1996-2005
1996 1,166 3.90%
1997 1,096 3.60%
1998 1,055 3.50%
1999 762 2.50%
2000 913 3.10%
2001 1,119 3.70%
2002 1,240 4.10%
2003 1,414 4.60%
2004 1,488 4.80%
2005 1,368 4.40%
Year
Unemployment
Unemployment
Rate
Saline County Unemployment Rate History
..00%""-
4.00%
2.00%
0.00%
1996 1997 1998 1999 2000 2001 2002 2003 2004 2005
Emoloyment by Industry
2000
1990
Services
Retail Trade
Manufacturing
Government & Gov't Services
Construction
Finance, Insurance, Real Estate
Wholesale Trade
Transportation
Farm
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
Kansas Department of Labor
University of Kansas, Salina/Saline County Profile Report
United States Census Bureau
70
COMPLIANCE
~~i' ,--
r 0 cr
L.- _
On March 7, 2005, the Adjutant General of Kansas, Tod
Bunting and the Salina Airport Authority announced the
expansion of the Kansas Army National Guard's Readiness
Sustainment Maintenance Site (RSMS) to the Salina Airport
Industrial Center. Following a $1.5 million facility renovation,
the Airport leased a 67,859 sq. ft. manufacturing facility to
the KSARNG making them a principal customer of the
Authority.
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.P.A.
Leslie M. Corbett, C.P.A.
Stacy J. Sokol, C.PA
Marci K. Fox, C.P.A.
Delores K. Longenecker, C.P.A.
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
REPORT ON INTERNAL CONTROL OVER FINANCIAL
REPORTING AND ON COMPLIANCE AND OTHER MATTERS
BASED ON AN AUDIT OF FINANCIAL STATEMENTS
PERFORMED IN ACCORDANCE WITH
GOVERNMENT AUDITING STANDARDS
To the Board of Directors
Salina Airport Authority
We have audited the basic financial statements of Salina Airport Authority as of
and for the years ended December 31,2005 and 2004, and have issued our report
thereon dated June 8,2006. We conducted our audit in accordance with auditing
standards generally accepted in the United States of America and the standards
applicable to financial audits contained in Government Auditing Standards, issued
by the Comptroller General of the United States and the Kansas Municipal Audit
Guide, prescribed by the Director of Accounts and Reports, Department of
Administration of the State of Kansas.
Internal Control Over Financial Reporting
In planning and performing our audit, we considered Salina Airport Authority's
internal control over financial reporting in order to determine our auditing
procedures for the purpose of expressing our opinion on the basic financial
statements and not to provide an opinion 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 reportable 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 caused by error
or fraud in amounts that would be material in relation to the basic 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.
Compliance and Other Matters
As part of obtaining reasonable assurance about whether Salina Airport Authority's
basic financial statements are free of material misstatement, we performed tests of
its compliance with certain provisions of laws, regulations, contracts and grant
agreements, noncompliance with which could have a direct and material effect on
the determination of financial statement amounts. However, providing an opinion
on compliance with those provisions was not an objective of our audit, and
accordingly, we do not express such an opinion. The results of our tests disclosed
no instances of noncompliance that are required to be reported under Government
Auditing Standards.
71
We noted certain additional matters that we reported to the management of Salina Airport Authority in a
separate letter dated June 8, 2006.
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.
~~BINE AND.. RE.TTE.LE, CHARTERED
~.tk~t~\.(- O/\lfl ~~~
June 8, 2006
72
CLUBlNE&
RETIELE
CHARJ."ERED
Certified Public Accountants
(fill
Robert I. Clubine, C.P.A.
David A. Rettele, C.P.A.
Jay D. Langley, C.P.A.
Jon K. Bell, C.PA
Leslie M. Corbett, C.P.A.
Stacy J. Sokol, C.P.A.
Marci K. Fox, C.PA
Delores K. Longenecker, C.P.A.
John T. Millikin, C.P.A.
Linda A. Suelter, C.PA
218 South Santa Fe
P.O. Box 2267
Salina, Kansas
67402-2267
Salina
785 / 825-5479
Salina Fax
785 / 825-2446
Ellsworth
785/472-3915
Ellsworth Fax
785/472-5478
REPORT ON COMPLIANCE WITH REQUIREMENTS
APPLICABLE TO EACH MAJOR PROGRAM AND ThrTERNAL
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, 2005. Salina Airport
Authority's major federal programs are identified in the summary of auditors'
results section of the accompanying schedule of findings and questioned costs.
Compliance with the requirements of laws, regulations, contracts and grant
agreements applicable to each of its major federal programs is the responsibility of
Salina Airport Authority's management. Our responsibility is to express an opinion
on Salina Airport Authority's compliance based on our audit.
We conducted our audit of compliance in accordance with auditing standards
generally accepted in the United States of America; the standards applicable to
financial audits contained in Government Auditing Standards, issued by the
Comptroller General of the United States; and OMB Circular A-l33, Audits of
States, Local Governments, and Non-Profit Organizations. Those standards and
OMB Circular A-133 require that we plan and perform the audit to obtain
reasonable assurance about whether noncompliance with the types of compliance
requirements referred to above that could have a direct and material effect on a
major federal program occurred. An audit includes examining, on a test basis,
evidence about Salina Airport Authority's compliance with those: requirements and
performing such other procedures as we considered necessary in the circumstances.
We believe that our audit provides a reasonable basis for our opinion. Our audit
does not provide a legal determination on Salina Airport Authority's compliance
with those requirements.
In our opinion, Salina Airport Authority complied in all material respects, with the
requirements referred to above that are applicable to each of its major federal
programs for the year ended December 31,2005.
Internal Control Over Compliance
The management of Salina Airport Authority is responsible for establishing and
maintaining effective internal control over compliance with requirements oflaws,
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.
73
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 reportable 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
caused by error or fraud 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 ofperfonning their assigned
functions. We noted no matters involving the internal control over compliance and its operation that we
consider to be material weaknesses.
This report is intended solely for the information and use of the audit committee, management, others within
the organization, 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.
C;;1IN: AND RET..TELE, CHARTERED
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June 8, 2006
74
SALINA AIRPORT AUTHORITY
Salina, Kansas
SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
For the Year Ended December 31, 2005
Federal
CFDA
Number
Federal Grantor / Pass-through Grantor /
Program or Cluster Title
U.S. Department of Transportation
Airport Improvement Program
20.106
Pass-through
Entity
Identifying
Number
N/A
See notes to the schedule of expenditures of federal awards.
Schedule 1
Federal
Expenditures
$ 3,186,636
75
SALINA AIRPORT AUTHORITY
Salina, Kansas
NOTES TO SCHEDULE OF EXPENDITURES OF FEDERAL AWARDS
For the Year Ended December 31, 2005
Note 1 Basis of Presentation
The accompanying schedule of expenditures of federal awards includes the fede:ral grant activity of
Salina Airport Authority and is presented on the accrual basis of accounting. The information in this
schedule is presented in accordance with the requirements of OMB Circular A-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.
76
SALINA AIRPORT AUTHORITY
Salina, Kansas
Schedule 2
SUMMARY SCHEDULE OF PRIOR AUDIT FINDINGS
For the Year Ended December 31,2005
There are no prior audit findings.
77
SALINA AIRPORT AUTHORITY
Salina, Kansas
SCHEDULE OF FINDINGS AND QUESTIONED COSTS
For the Year Ended December 31,2005
Schedule 3
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 low risk auditee.
FINDINGS - FINANCIAL STATEMENTS AUDIT
None.
78
SALINA AIRPORT AUTHORITY
Salina, Kansas
Schedule 4
CORRECTIVE ACTION PLAN
For the Year Ended December 31, 2005
None required.
79
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SLNAirport
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Early in 2005, the Salina Airport took delivery of a new
Rosenbauer Aircraft Rescue and Firefighting vehicle.
The Airport was successful in securing a $621,000
Federal Aviation Administration grant through the
Airport Improvement Program to fund the vehicle
acquisition.
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