SR-04-30-2013-11ACity of City Council Report
Santa monied
City Council Meeting: April 30, 2013
Agenda Item: ( (-A
To: Mayor and City Council
From: Martin Pastucha, Director of Public Works
Subject: Resolution Amending the Santa Monica Airport Landing Fee Program
Recommended Action
Staff recommends that the City Council:
1. Adopt the attached resolution to change the landing fee program from the current
$2.07 per thousand pounds of certificated maximum gross landing weight to
$5.48 and apply the fee to itinerant and based aircraft at the Santa Monica
Airport (Airport), effective August 1, 2013.
2. Approve the budget changes as outlined in the Financial Impacts and Budget
Actions section of this report.
Executive Summary
Based on the results of a fee study, staff recommends increasing the landing fee at the
Santa Monica Airport (SMO) from $2.07 to $5.48 per thousand pounds of certificated
maximum gross landing weight and applying the fee to all aircraft including SMO -based
aircraft. The proposed rate would provide net revenue to recover the cost to maintain
and operate the public -use aviation areas (runway, taxiways, taxilanes and ramps) of
the Airport.
Background
The Airport Fund began taking loans from the General Fund in 1988 to make up
operating deficits. As shortfalls continued, numerous additional loans were required
from the General Fund to enable the Airport Fund to meet its obligations. The most
recent General Fund loan of $3.3 million was made in FY 2011 -12 so that the Airport
Fund could cover part of the following operating overruns:
1
Fiscal Year Chanae in Net Assets
FY 2007 -08
$
(597,434)
FY 2008 -09
$
(1,419,257)
FY 2009 -10
$
(564,558)
FY 2010 -11
$
(2,117,933)
FY 2011 -12
$
(1,137,065)
* As per the Comprehensive Annual Financial Reports (CAFR)
As of June 30, 2012, the Airport Fund's outstanding loan obligation to the General Fund
was $13.3 million. With the loss of Redevelopment, the City's General Fund has
assumed a greater responsibility for the costs of needed infrastructure improvements
citywide. This requires Enterprise Operations such as the Airport Fund to achieve
financial self- sufficiency. To that end, the City has undertaken a landing fee study to
determine the cost recovery charge for aviation operations at the Airport.
Landing fees are used to maximize safety and efficiency by providing the necessary
resources to maintain and operate the public -use airfield areas at the Airport. On June
21, 2005, Council adopted Resolution No. 10047 setting the current landing fee at $2.07
per 1,000 pounds of certificated maximum gross landing weight as published by the
aircraft manufacturer. This resolution exempted aircraft that were based at the Airport
for a period of 30 days or more from the fee requirement. The fee exemption ends when
an aircraft ceases to be based at the Airport.
The Federal Aviation Administration (FAA) Airport Sponsor Assurances requires that the
City maintain a fee and rental structure for Airport facilities and services that allow the
Airport to operate as a self- sustaining enterprise fund. Capital projects required in the
public -use aviation areas have been completed consistent with the provisions contained
in the 1984 Settlement Agreement and FAA Airport Sponsor Assurances that require
the City to maintain the Airport in good working order as prescribed by applicable
federal, state, and local agencies.
2
Discussion
During the May 8, 2012, Council meeting, as part of Phase III of the Visioning process,
staff was directed to conduct fee studies that included landing fees. Staff retained
aviation consultants WJ Advisors, LLC, to develop a financial model providing a basis
each year that monitors the financial performance of the Airport and provides a
consistent framework to determine an airport landing fee that should be applied to
achieve cost recovery for the public -use airfield areas at the Airport. This study was
conducted in accordance with the federal guidelines to make the aviation operations
financially self- sustaining.
Staff examined the Airport's historic costs to determine the amount allocable to public -
use aviation areas as defined in Chapter 18 of the FAA's Airport Rates and Charges
policy. This definition includes runways and taxiways, public aircraft parking ramps and
aprons, and associated aeronautical land, such as land used for navigational aids.
Capital expenditures dating back to 2002 that are allocable to these areas were
amortized over the useful life of the asset. Staff calculated the annual gross landed
weight for all aircraft using the Airport. The annual historic operating and amortized
capital expenditure were divided by annual gross landed weight for all aircraft using the
Airport to determine the fee per 1,000 lbs. of landed weight. The goal of the study was
to establish and charge a landing fee rate that is fair and equitable across all users,
including itinerant and SMO -based aircraft making the operation financially self -
sustaining. The proposed landing fee rate and financial projections are in Attachment 2.
The results of the landing fee study recommended that the landing fee be increased
from the current $2.07 per thousand pounds of gross landed weight to $5.48. Staff
recommends that this rate be effective August 1, 2013, and applied non - discriminatorily
to both itinerant and SMO -based aircraft.
Staff examined landing fee programs at other airports, focusing on airports that charge
a landing fee to based aircraft. Additionally, the City's current landing fee structure and
rate were reviewed to determine if the revenue from the airfield portion recovered the
full cost of aviation expenditures in order to maintain the public -use airfield areas of the
3
Airport. The result of this analysis determined that the airfield side was not self -
sustaining and required significant abatements from landside operations. This loss
substantially contributed to the Airport Fund acquired debt of $13.3 million from the
City's General Fund and has required the deferral of several capital improvement
projects to the Airport's aircraft operations areas, which include the runway, taxiways,
aircraft parking areas, helipad, and service road, as well as the deferral of non - aviation
capital improvements. Staff has had to balance the need of maintaining the safety and
integrity of the public -use airfield areas of the Airport to meet federal standards with
inadequate funding. In recent years, staff has expended capital improvement funds to
perform the minimum repairs necessary to meet federal guidelines in lieu of full scale
pavement rehabilitation projects.
Additional revenue generated from the landing fee will be used to make the airfield
operations financially self- sustaining and to create an Airport Improvement Account to
be used for the renewal and replenishment of assets, the construction and repair of
facilities, the acquisition of equipment, and other related uses.
Commission Action
The results of the study were presented to the Airport Commission during its A ril 1
2013, special meeting. The Commission heard comments from members of both the
aviation and neighboring communities. The Airport Commission made a motion to defer
any decision on whether to recommend this matter to the City Council until its April 22,
2013, regular meeting. A report on the Airport Commission's April 22, 2013, meeting
will be incorporated into staffs oral presentation at the April 30, 2013, Council meeting.
Public Outreach
In March and April 2013, staff had two meetings with personnel of the Western- Pacific
Region of the FAA and reviewed the methodology and the findings of the study. Staff
also held several meetings and shared the results of the study with various aviation
interest groups including the Santa Monica Airport Association; Friends of Santa Monica
Airport; local Fixed Based Operators; and flight schools. Staff disseminated notices to
2
all airport tenants and posted them in public areas at the Airport advising of the
proposed change to the current landing fee program. This notice was also posted on
the Airport's website.
Financial Impacts & Budget Actions
Staff projects that the new landing fee structure will result in additional annual revenue
to the Airport Fund of approximately $1.4 million in FY 2013 -14 and $1.5 million in FY
2014 -15. Should Council adopt the proposed Resolution revising Santa Monica Airport
landing fees, staff will include this revenue in the FY 2013 -14 and FY 2014 -15 proposed
budgets in account 33431.402170; revenue increase is contingent upon Council budget
adoption.
Prepared by: Stephanie Manglaras, Principal Administrative Analyst, Public Works
Approved: Forwarded to Council:
Attachments:
1 — Resolution
2 — Proposed Airport Landing Fee Model, March 13, 2013
0
ATTACHMENT 2
Financial Projections -- Proposed Landing Fee Calculation
Santa Monica Municipal Airport
City of Santa Monica
March 13. 2013
This financial model calculates a proposed landing fee rate based on a projection of historic costs, revenues, and the landed weight forecast.
Principles Used by the City to Calculate the Proposed Landing Fee Rate
The rate was calculated based on the following principles:
• Historic costs allocable to the airfield area as defined in section 18.4.a in the FAA's Chapter 18 Airport Rates and Charges. Defined as runways and
taxiways, public aircraft parking ramps and aprons, and associated aeronautical land, such as land used for navigational aids.
Cost recovery principles
• A basis for establishing and charging the rate — landed weight —that is fair and equitable across all users, including itinerant and based aircraft.
Costs that are Recovered through Proposed Landing Fee Rate
Costs recovered through the landing fee rate include the following:
Operating expenses of the Airport, including expenses for City- provided services such as insurance, risk management, accounting support, etc.
Capital expenditures that are allocable to the airfield area. Costs are recovered (amortized) from users over the useful life of the asset at an
interest rate provided by the City for the year when the project was placed in service for its intended use, and included in the landing fee rate base.
Calculation of the Proposed Landing Fee Rate
The elements of the landing fee exhibit:
Total operating expenses and amortization charges allocable to the airfield
Specific credits are applied against airfield costs, which are airport fuel sales and noise abatement revenues
The resulting "net costs" are divided by landed weight of aircraft using the SMO airfield to derive the proposed landing fee rate.
List of Exhibits
E1 Operating Expenses
EIA Operating Expenses Detail
E2 Capital Project Amortization Charges (Completed Airfield Projects since 2002)
E3 Summary of Landed Weight
Page 2 of 9
LANDING FEE CALCULATION
Financial Projections -- Proposed Landing Fee Calculation
Santa Monica Municipal Airport
(For Fiscal Years Ending June 30)
Exhibit Reference
AIRFIELD COSTS
Operating expenses (a) Exhibit 1
Amortization of City funded assets Exhibit 2
TOTAL AIRFIELD COSTS
AIRFIELD CREDITS
Airport Fuel Sales
Noise Abatement - Airport
TOTAL AIRFIELD CREDITS
NET AIRFIELD COSTS
Airport abatement of Airfield Costs
ADJUSTED NET AIRFIELD COSTS
LANDED WEIGHT (1,000 -lb. units)
Based aircraft
Itinerant
TOTAL LANDED WEIGHT (1,000 -lb. units)
LANDING FEE (1,000 -LB. UNIT) (b)
LANDING FEE REVENUES (c)
Source: City of Santa Monica
Prepared by: City of Santa Monica and WJ Advisors LLC
[A]
[B]
[C =A +B]
[D]
[E =C +D]
Exhibit 3
Exhibit 3
[F]
[G = -E/Fl
[H =F *G]
Actual
Actual
Budget
Forecast
FY 2010 -2011
FY 2011 -2012
FY 2012 -2013
FY 2013 -2014 -
FY 2014 -2015
FY 2015 -2016
$ 1,297,167
$ 1,278,361
$ 1,504,733
$ 1,505,386
$ 1,544,726
$ 1,583,818
178,862
. 335,192
340,575
` `.442,081:
468,671
502,740
$ 1,476,029
$ 1,613,553
$ 1,845,308
$ 1,947,467
$ 2,013,397
$ 2,086,558
$ (206,437)
$ (186,404)
$ (199,200)
$
$ (208,264)
$ (213,470)
(8,000)
(33,075)
(23,214)
(23678)
(24,270)
(24,877)
(930,265) $ (1,092,119) $ (1,322,894)
119,026 119,026 119,026
195,010 195,010 195,010
314:036. 314.036 314 036
NOTES:
(a) Expenditures limited to components of airfield and for aeronautical use as identified by the Federal Aviation Administration's Policy Regarding the Establishment of Airport Rates and Charges.
(b) It is assumed that for the forecast period, a landing fee rate that is based on full cost recovery is charged to all aircraft (based & itinerant).
(c) Landing fee revenues historically and for the FY 2012 -2013 Budget are based on charging a landing fee to itinerant aircraft only.
It is assumed that all aircraft are charged a landing fee for the forecast period, including based & itinerant aircraft.
Page 3 of 9
Financial Projections -- Proposed Landing Fee Calculation
Exhibits
Santa Monica Municipal Airport
City of Santa Monica
March 13. 2013
Exhibit 1
OPERATING EXPENSES
Financial Projections -- Proposed Landing Fee Calculation
Santa Monica Municipal Airport
(For Fiscal Years Ending June 30)
OPERATING EXPENSES
Salaries & wages
Indirect cost allocation
Security
Maintenance
Utilities
Supplies & equipment
Insurance
Other
TOTAL OPERATING EXPENSES
Annual growth rate (a)
OPERATING EXPENSES BY COST CENTER
Airfield
Non-airfield
TOTAL OPERATING EXPENSES
Source: City of Santa Monica
Prepared by: City of Santa Monica and WJ Advisors LLC
$ 3,839,753 $ 3,902,489 $ 4,491,575 $ 4,252,457 $ 4,367,319 $ 4,480,586
NOTES:
(a) Salaries & wages were lower in FY 2011 -2012 by 5.0 percent primarily due to savings from a partial position vacancy.
The FY 2012 -2013 Budget estimate and the forecast is based on the assumption that there is a return to full and level staffing.
The FY 2012 -2013 Budgeted expenses are estimated to be only .7 percent higher than in FY 2010 -2011.
(b) The FY 2012 -2013 Budget estimate for the indirect allocation is 5.0 percent higher than FY 2011 -2012 primarily due to additional staff for Airport visioning processes.
The FY 2013 -2014 estimate is 32.9 percent lower due to revised assumptions and cost analyses to be incorporated beginning that fiscal period.
(c) In FY 2011 -2012, security expenses were 9.8 percent lower than in FY 2010 -2011 due to savings from vacancies in security positions.
The FY 2012 -2013 Budget estimate is 21.2 percent higher than in FY 2011 -2012 (or 9.2 percent higher than FY 2010 -2011)
primarily due to the Police Department's request to increase airport security.
(d) The estimate for Budget FY 2012 -2013 for maintenance is 54.0 percent higher than in FY 2011 -2012 due to deferral of major maintenance items.
While efforts continue to minimize maintenance expenses, the budget must account for maintenance costs.
(e) The estimate for Budget FY 2012 -2013 for utilities is 55.1 percent higher than in FY 2011 -2012. This is a result of incorporating tenant reimbursements into the actual amounts shown.
Utility lighttpower increases applied to the budget and forecast period do not include reimbursements from tenants. These will now be recorded as revenue.
(f) Supplies & equipment and "other" expenses increased in FY 2011 -2012 by 33.8 percent and 25.5 percent over FY 2010 -2011, respectively.
In the FY 2012 -2013 Budget, these expenses are projected to increase at approximately 112 of the growth rates that occurred in FY 2011 -2012.
These increases are reflective of professional services and are not projected to occur during the forecast period.
(g) Insurance expenses increased in FY 2011 -2012 by 33.1 percent over FY 2010 -2011. The increases were due to a revised allocation of property insurance to more accurately reflect actual costs.
In the FY 2012 -2013 Budget, these expenses are projected to increase by approximately 12.8 over FY 2011 -2012. This was primarily due to the General Liability insurance
being overstated and a budget adjustment was made at midyear. The forecast period assumes steady growth at the rate provided by the City's Risk Management Division.
This rate is based on broker estimates and evaluations insurance markets.
Page 5 of 9
Actual
Actual
Budget
Forecast
FY 2010 -2011
FY 2011 -2012
FY 2012 4013
FY 2013 -2014
FY 2014 -2015
FY 2015 -2016
(a)
$ 1,373,493
$ 1,304,704
$ 1,382,652
$ 1,410,305
$ 1,445,582
$ 1,481,741
(b)
868,449
894,503
939,228
630,226
645,982
662,131
(c)
535,708
482,970
585,128
596,831
611,751
627,045
(d)
290,797
286,532
441,293
450,119
461,372
472,906
(e)
199,126
201,334
312,289
320,550
329,721
339,657
(f)
89,952
120,346
140,210
143,014
146,590
150,254
(9)
91,800
122,227
137,872
137,452
148,262
154,340
(f)
390,428
489,873
552,903
563,961
578,060
592,512
$ 3,839,753
$ 3,902,489
$ 4,491,575
$ 4,252,457
$ 4,367,319
$ 4,480,586
1.6%
15.1%
-5.3%
2.7%
2.6%
$1,297,167
$1,278,361
$1,504,733
$1,505,386 '..
$1,544,726
$1,583,818
2,542,586
2,624,128
2,986,842
2,747,071
2,822,593
2,896,767
$ 3,839,753 $ 3,902,489 $ 4,491,575 $ 4,252,457 $ 4,367,319 $ 4,480,586
NOTES:
(a) Salaries & wages were lower in FY 2011 -2012 by 5.0 percent primarily due to savings from a partial position vacancy.
The FY 2012 -2013 Budget estimate and the forecast is based on the assumption that there is a return to full and level staffing.
The FY 2012 -2013 Budgeted expenses are estimated to be only .7 percent higher than in FY 2010 -2011.
(b) The FY 2012 -2013 Budget estimate for the indirect allocation is 5.0 percent higher than FY 2011 -2012 primarily due to additional staff for Airport visioning processes.
The FY 2013 -2014 estimate is 32.9 percent lower due to revised assumptions and cost analyses to be incorporated beginning that fiscal period.
(c) In FY 2011 -2012, security expenses were 9.8 percent lower than in FY 2010 -2011 due to savings from vacancies in security positions.
The FY 2012 -2013 Budget estimate is 21.2 percent higher than in FY 2011 -2012 (or 9.2 percent higher than FY 2010 -2011)
primarily due to the Police Department's request to increase airport security.
(d) The estimate for Budget FY 2012 -2013 for maintenance is 54.0 percent higher than in FY 2011 -2012 due to deferral of major maintenance items.
While efforts continue to minimize maintenance expenses, the budget must account for maintenance costs.
(e) The estimate for Budget FY 2012 -2013 for utilities is 55.1 percent higher than in FY 2011 -2012. This is a result of incorporating tenant reimbursements into the actual amounts shown.
Utility lighttpower increases applied to the budget and forecast period do not include reimbursements from tenants. These will now be recorded as revenue.
(f) Supplies & equipment and "other" expenses increased in FY 2011 -2012 by 33.8 percent and 25.5 percent over FY 2010 -2011, respectively.
In the FY 2012 -2013 Budget, these expenses are projected to increase at approximately 112 of the growth rates that occurred in FY 2011 -2012.
These increases are reflective of professional services and are not projected to occur during the forecast period.
(g) Insurance expenses increased in FY 2011 -2012 by 33.1 percent over FY 2010 -2011. The increases were due to a revised allocation of property insurance to more accurately reflect actual costs.
In the FY 2012 -2013 Budget, these expenses are projected to increase by approximately 12.8 over FY 2011 -2012. This was primarily due to the General Liability insurance
being overstated and a budget adjustment was made at midyear. The forecast period assumes steady growth at the rate provided by the City's Risk Management Division.
This rate is based on broker estimates and evaluations insurance markets.
Page 5 of 9
Exhibit 1A
2,994,897
TOTAL OPERATING EXPENSES $ 3,839,753 $ 3,902,489 $ 4,491,576 $ 4,262,457 $ 4,367,319 $
4,480,586
Airfield 1,297,167 1,278,361 1,504,733 '1,505,386. 1,544,726
Non - airfield
1,583,818
2,642,586 2,624,128 2,986,842 2,747,071 2,822,593
2,896,767
TOTAL OPERATING EXPENSES $ 3,839,753 It 3,902,489 $ 4,491,575 $ 4,262,457 $ 4,367,319 $
4,480,586
Source: City of Santa Monica
Actual
Actual
Budget
Utility light/power increases applied to the budget and forecast period do not in elude reimbursements from tenants. These will now be recorded as revenue.
Forecast
(b) Property insurance annual percent Increases applied over the forecast period are base d on revised assumptions provided by the City's Risk Management Division.
Cost Center
Allocation
Non.
Line item designation
FY 2010.2011
BY 2011.2012
BY 2012 -2013
FY 2013 -2014
BY 2014 -2015
FY 20152016
Airfield
airfield
OPERATING EXPENSES
Salaries & wages
33203 (Airport - City Manager)
semdes &,rases
$ 960,866
43.8%
56.4%
3.431 (Airport - Public Works)
eelenesswemts
895,330
998,655
1,018,628
1,044,094
1,070,196
1 43.61/.
68.4%
33457 (Airport Maintenance - Public Wo eeisr'cssvraeee
353,063
353,958
387,717
395,471
405,358
415,492
20.0%
80.0%
Total Salaries & Wages
$ 1,313,929
$ 1,249,288
$ 1,386,372
$ 1,414,099
$ 1,449,452
$ 1,486,688
Supplies & expense
U01- Light/Power(a)
Jore",
$ 44153
$ 36,924
y 99,819
$ 105,509
$ 111,523
$ 117,879
100%
90,0%
Utll - naturalGes
ut",
10,789
9,581
11,433
11,433
11,433
11,776
0.0%
100.0%
Utll - Water
umlties
42,365
59,146
102,647
104,700
107,317
110,000
10,0%
90,0%
Stormwater M9mt
Utilities
75,773
78.790
77,317
77,317
77,317
77,317
25.0%
75.0%
Transfer Station fee
utiisies
1,590
3,339
1,748
1,783
1,828
1,873
0.0%
100.0%
Back Fees
,mar
986
685
625
638
653
670
0.0%
100.0%
bit - Telephone
unr.gee
24.456
15,554
19.325
19,808
20,303
20,811
436%
56.4%
Office Supplies 1 Expenses
suppums & eq, im,cAt
13,462
12,844
13,000
13,260
13,592
13,931
416%
56.4%
Metered Postage
supplies a eyuipmeni
3,360
3,698
5,400
5,508
5,646
5,787
5.0%
95,0%
Inventory Issues
r iles a egmpment
933
1,437
5,000
5,100
5,228
5,358
500%
50.0%
Community Outreach
Onh ,
11,666
5,390
13,000
13,260
13,592
13,931
90.0%
10.0%
Equipment Rental
SWpries&oquipmenc
7,336
8,446
12,760
13,015
13,341
13,674
50.0%
50,0%
Mileage
rnh,
-
-
550
561
575
569
0,0%
'1040%
Conference /Migs/Frsva1
on,or
10,003
9.733
5,500
5,610
5,750
5,894
50.0%
50.0%
Food purchases
oiner
1,519
1,655
1,500
1,530
1,568
1,607
50.0%
50.0%
Membership Dues
other
1,090
2,509
2,750
2,806
2,875
2,947
65.0%
35.0 °l0
Vehicles - Fuel
ecpniiess eycipmem
1,948
1,357
2,500
2,560
2,614
2,679
(1
100.6%
Vehicles - TlresiTubes
sopp8aa seympment
-
600
612
627
643
50.0%
50.0%
Vehicles - insurance
..
9.500
-
-
50.0%
50.0%
CNGFuei
$,,peas s egu'pment
2,772
975
3,950
4,029
4,130
4,233
10,0%
50,0%
Van Mgmt Fund - plaint
hlin;enanoe
27,292
26,656
48,734
49,709
50,951
52,225
5.0%
96,0%
General' lability f Auto
inseren.r
82,300
172
9,696
130
130
130
50.0%
500%
Property Insurance (b)
tnsurar,,
74,273
77,987
87,552
96,927
101,773
25.0%
75.0%
Special insurance
Insueoc.
45,575
47,854
47,826
49,261
50,493
25.0%
75.0%
Airport Security Guard trans
secumv
535,708
482,970
585,128
596,831
611,751
627,045
60.0%
40.0%
Special Equip Malrt
r iMenance
3,384
2,629
-
-
-
00%
100.0%
Audio Equip Ma;nt
Melnrraao,e
461
-
17,700
18,054
18,505
18,968
100.0%
00%
Bldg /StNeture March
ces"i"t'n,
4,000
4,080
4,182
4,287
0.0%
100.0%
Special Department Supplies
supplies anqurpmeot
2.300
475
6,300
6,426
6,587
6,751
0.61
100.0%
indlrect COS( Allocation
ind3eat case aim °otlan
799,455
623,439
864,611
435,173
446,052
457,204
11.0%
89.07
Other Costs
ome,
19,752
18,941
39,000
39,780
40,775
41,794
0.0%
10( 1
Professional Services
,mar
331,817
441,817
460 „000
469,200
480,930
492,953
r 36.5% 63.6%
Reimburse Engineering Office
amen
2,963
106
3,353
3,420
3,606
3,593
25.0%
75.0%
Airport Field Maintenance
Malnienecce
340
483
3,600
3,672
3,764
3,858
43,6%
56,4 °%
Property Taxes_
,;tier
8916
8,827
26,625
27,158
27,836
28,532
26,0%
75.0%
Bad Renovation /Maintenance
Mamteneme
956
60000
61,200
62,730
64,298
10.0%
90.0%
raise Eauiprr,ont
suppnes &
34,865
59,974
70,000
71,400
73,185
75,015
90.0%
10,0%
Office Supplies /Expenses
ibiat"s &ayvepmeM
1,207
1,634
700
714
732
750
50.0%
50,0%
Inventory Issues
suppice &egmpmeot
16,375
26,004
17,400
17,746
18,192
18,646
50.6%
50.0%
Conferences an iings7 Gavel
Amer
120
-
-
-
50.0%
50.0%
Food purchases
spar
22
Vehldes - Fuels
sopplae a or, nem
208
-
-
50,0%
50.0%
CNGFuei
sugpeee &alulpr nt
1166
1,482
-
-
-
-
-
40%
10.0%
100.0%
90.0%
General debility
ineo =encei
2207 ,
2,335
1,944
1,944
1,944
250%
75.0%
Noe- Aviiatlon Maint
Memienonuo
151,046
151,212
132,459
135,108
138,486
141,948
0.0%
100.0%
Aviation Maint
Momtennms
76,841
72906
139,400
142,188
145,743
149,386
950%
50%
Landscape plant
Mammoznce
20,633
20,890
24,600
25,092
25,719
26,362
10.0%
90.0%
UNfonc l Proboilve Genre
soppilea &egoipmem
4,226
1,612
2,600
2,652
2,718
2,786
20.0%
80.0%
Indlrect Cost Allocation
indirect ACS eunra iou
68,994
71,064
74,617
195053
199,929
204,928
19.1% 80.9%
Aimed Field Malnt
o,Wt,,.r v
10,800
10,800
10,800
11,016
11,291
11,574
50.0 °%
500%
Retirement - MicroErupt
Salad,, 8wesris
59,564
55,416
-
-
-
-
43,6%
56,4%
Interest Exp- Bands and Other Loans
Omer
1,492
-
-
_
C6i°
1000%
PERS peydown
ocursawaoes
-
-
(3,720)
(3,794)
(3,870)
(3,948)
43.6%
56.4%
Total supplies and expense $ 2,625,824 § 2,663,201 $ 3,105,203 $ 2,838,368 $ 2,917,867 §
2,994,897
TOTAL OPERATING EXPENSES $ 3,839,753 $ 3,902,489 $ 4,491,576 $ 4,262,457 $ 4,367,319 $
4,480,586
Airfield 1,297,167 1,278,361 1,504,733 '1,505,386. 1,544,726
Non - airfield
1,583,818
2,642,586 2,624,128 2,986,842 2,747,071 2,822,593
2,896,767
TOTAL OPERATING EXPENSES $ 3,839,753 It 3,902,489 $ 4,491,575 $ 4,262,457 $ 4,367,319 $
4,480,586
Source: City of Santa Monica
Prepared by: City of Santa Monica and WJ Advisers LLC
(a) The estimate for Budget BY 2012-2013 for utilities is 55.1 percent higher than in FY 2011 -2012. This is a result of incorporating tenant reimbursements into the actual amounts shown.
Utility light/power increases applied to the budget and forecast period do not in elude reimbursements from tenants. These will now be recorded as revenue.
(b) Property insurance annual percent Increases applied over the forecast period are base d on revised assumptions provided by the City's Risk Management Division.
Page 6 of 9
Exhibit 2
AMORTIZATION CHARGES -- COMPLETED CAPITAL PROJECTS
Financial Projections — Proposed Landing Fee Calculation
Santa Monica Municipal Airport
(For Fiscal Years Ending June 30)
NOTE: Includes capital expenditures that are allocable to the airfield area. Costs are recovered (amortized) from users over the useful life of the asset at an
interest rate provided by the City for the year when the project was placed in service for its intended use, and included in the landing fee rate base.
Includes expenditures for completed airfield capital projects beginning in 2002.
Source: City of Santa Monica
Prepared by: City of Santa Monica and WJ Advisors LLC
Page 7 of 9
Actual
Actual
Budget
Forecast
FY 10 -11
FY 2011 -2012
FY 2012 -2013
FY 2013 -2014
FY 2014 -2015
FY 2015 -2016
AMORTIZATION CHARGES
Airfield
$ 178,862
$ 335,192
$ 340,575
$ 442,081
$ 468,671
$ 502,740
Non - airfield
387,915
410,552
443,261
460,191
476,378
463,942
TOTAL AMORTIZATION CHARGES
$ 566,777
$ 745,744
$ 783,836
$ 902,273
$ 945,049
$ 966,683
NOTE: Includes capital expenditures that are allocable to the airfield area. Costs are recovered (amortized) from users over the useful life of the asset at an
interest rate provided by the City for the year when the project was placed in service for its intended use, and included in the landing fee rate base.
Includes expenditures for completed airfield capital projects beginning in 2002.
Source: City of Santa Monica
Prepared by: City of Santa Monica and WJ Advisors LLC
Page 7 of 9
Exhibit 3
SUMMARY OF LANDED WEIGHT
Financial Projections -- Proposed Landing Fee Calculation
Santa Monica Municipal Airport
(For Fiscal Years Ending June 30)
LANDED WEIGHT FORECAST (1,000 -lb- units)
Based aircraft
Itinerant
TOTAL LANDED WEIGHT (1,000 -lb. units)
Annual growth rate
Based aircraft
Itinerant
Total annual growth rate
Source: City of Santa Monica
Prepared by: City of Santa Monica and WJ Advisors LLC
Estimated
Actual (a) Actuals (b)
(2011-2012 FY 2012 -201
116,986 119,026 119,026 119,026 119,026
191,124 195,010 195,010 195,010 195,010
308,110 314,036 314,036: 314,036 314,036
0,0%
0.0%
0,0%
0.0%
0.0%
0.0%
1.9% 0.0%
0.0%
0.0%
NOTES:
(a) Based on actual data provided by the City of Santa Monica.
(b) Based on actual data for July 1 through December 31, 2012 and forecasted data for January 1 through June 30, 2013 provided by the City of Santa Monica.
(c) Forecasted levels, provided by the City of Santa Monica, to remain flat.
Page 8 of 9
REVENUES
Financial Projections- Proposed Landing Fee Calculation
Santa Monica Municipal Airport
(For Fiscal Years Ending June 30)
REVENUES
Landing fee revenues
Annual growth rate
Airfield revenues (excluding landing fee revenues)
Airport Fuel Sales
Noise Abatement - Airport
Total Airfield revenues (excluding landing fee revenues)
Annual growth rate
Non - airfield revenues
Airport - Hangar Rental Sales
Airport - Office / Shop Rental
Airport - Land Lease
Airport - Tie Down Charges
Airport - Misc Rev
Filming Receipts
Parking Receipts
Int Dep /investments
Unrealized Gain Loss
Accrued Investment Income
Amort/Accret
Total Non - airfield revenues
Annual growth rate
TOTAL REVENUES
Annual growth rate
Source: City of Santa Monica
Prepared by: City of Santa Monica and WJ Advisors LLC
(d)
(e)
(f)
633,996
538,358
1,878,612
159,944
3,026
15,450
91,349
29,568
(8,858)
(4,870)
6,492
Revised
748,177
642,030
1,920,022
152,400
5,336
8,177
65,694
97,647
(72,138)
(47,386)
60,877
763,141
654,871
1,958,422
155,448
5,442
8,340
67,008
99,600
(73,580)
(48,334)
62,094
782,219
671,242
2,007,383
159,334
5,578
8,549
68,683
102,090
(75,420)
(49,542)
63,647
Actual
Actual
Budget (a)
Forecast (a)
FY 2010 -2011
FY 2011 -2012
FY 2012 -2013
FY 2013 -2014
FY 2014 -2015
FY 2015-2016
(b) $ 331,327
$ 301,955
$ 300,000
$ 1,720,605
$ 1,780,863
$ 1,848,211
-8.9%
-0.6%
473.5%
3.5%
3.8%
$ 206,437
$ 186,404
$ 199,200
$ 203,184
$ 208,264
$ 213,470
(c) 8,000
33,075
23,214
23,678
24,270
24,877
[A] $ 214,437
$ 219,479
$ 222,414
$ 226,862
$ 232,534
$ 238,347
2.4%
13%
2.0%
2.5%
2.5%
(d)
(e)
(f)
633,996
538,358
1,878,612
159,944
3,026
15,450
91,349
29,568
(8,858)
(4,870)
6,492
687,305
616,224
1,952,985
146,843
7,602
11,650
93,599
8,628
(6,374)
(4,187)
5,379
748,177
642,030
1,920,022
152,400
5,336
8,177
65,694
97,647
(72,138)
(47,386)
60,877
763,141
654,871
1,958,422
155,448
5,442
8,340
67,008
99,600
(73,580)
(48,334)
62,094
782,219
671,242
2,007,383
159,334
5,578
8,549
68,683
102,090
(75,420)
(49,542)
63,647
801,775
688,023
2,057,568
163,318
5,718
8,762
70,400
104,642
(77,305)
(50,781)
65,238
[B] $ 3,343,067 $
3,519,654 $
5.3%
3,580,835 $
1.7%
3,652,452 $
2.0%
3,743,763 $
2.5%
3,837,357
2.5%
[C =A +B] $ ___..3,888,831 $
4,041,088 $
4.103.249 S
5.599.919 S
A 797 inn 4
4 091 o1G
NOTES:
(a) Certain budgeted and forecasted revenues are allocated based on percentages from FY 2011 -2012 actual revenue amounts.
(b) Landing fee revenues are estimated to increase substantially in FY 2013 -2014 based on the assumption that the City begins charging a landing fee to based aircraft.
(c) Airport noise abatement revenues increased in FY 2011 -2012 primarily due to increases in fines.
The FY 2012 -2013 Budget estimate reflects the level at which is expected to be maintained over the forecast period.
(d) Hangar sale revenues increased by 8.4 percent in FY 2011 -2012 primarily due to six months of new hangar lease revenue and revenues are expected to increase
by 8.9 percent in FY 2012 -2013 to reflect the entire year of lease revenue for the new rental. The forecasted amount is expected to be maintained over the forecast period.
(e) Office /shop rental revenues increased by 14.5 percent in FY 2011 -2012 primarily due to increased rentals and are expected to increase at 4.2 percent in FY 2012 -2013 due to
additional anticipated occupancy.
(f) Land lease revenues are budgeted to decline by 1.7 percent in the FY 2012 -2013 Budget however revenues estimated to be received in FY 2012 -2013 will likely
not result in a decline and forecasted estimates reflect continued growth over the forecast period.
Page 9 of 9
Reference Resolution No.
10744 (CCS)