Draft EUG Master Plan Update, February 2010

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CHAPTER 5 FINANCIAL FEASIBILITY ANALYSIS enplanements attain the growth projected in this plan. Finally, it will be necessary for the Airport to maintain its authority to impose a PFC for at least another five (5) years beyond the planning period since approximately $21.0 million in outstanding payments will remain on these debt instruments at the close of Fiscal Year 2028. At that time, the Airport is forecasted to have a balance of approximately $4.7 million in PFC revenues to utilize toward retiring these bonds. 3.3 Airport Operating and Capital Reserves The Airport currently maintains an Operating and Capital Reserves Fund, which is utilized to underwrite the local share requirements of Airport projects, not funded with PFC or private capital. This fund is also used to address unexpected operating expenses. For purposes of this analysis, it is assumed that this fund is used to meet the local obligation for AIP and PFC eligible projects as well as for work deemed ineligible for AIP and PFC funding. Based upon information obtained from Airport management, it is assumed that a balance of $3.3 million exists in this fund as of July 1, 2008. A cash flow analysis (see Table 5-10presented in Section 7. Cash Flow Analysis and Overall Feasibility) was performed to identify the likely impact that local share funding requirements of the recommended CIP from the Airport’s Operating and Capital Reserves would have on the cumulative balance of that fund. In this cash flow analysis, the annual beginning balance of the Airport’s Operating and Capital Reserve Fund was reduced by the amount required to fund the local requirements of the Airport’s CIP projects for that year. The Airport’s projected net revenue was then added to the Airport’s Operating and Capital Reserve Fund to estimate the year-end balance of that fund. The year-end balance of the fund was then carried over to the succeeding fiscal year and the same process was followed. The results of this analysis are presented and examined in Section 7.Cash Flow Analysis and Overall Feasibility. 3.4 Customer Facility Charge In 2006, the City authorized establishing a Customer Facility Charge (CFC) for all rental car transactions occurring at the Airport. Rental car companies collect the fees on behalf of the City and remit them to the Airport for use on capital expenditures and/or to fund operating expenditures associated with facilities constructed for the sole benefit of rental car customers. The Airport’s CFC is currently set at $2 per transaction day and the Airport collects approximately $300,000/year from this dedicated revenue source. Funds accruing to the Airport as the result of this assessment are earmarked for the construction of a consolidated Rental Car Service and Storage Facility in FY 2009. Upon completion of construction, the Airport intends to continue to impose this fee in order to provide sufficient revenues for the operation, maintenance, and reserve funds required for this facility. It is anticipated that upon occupancy of the facility, the Airport may reassess the level of CFC and adjust it accordingly to ensure that the revenue generated each year does not exceed authorized uses. 3.5 Other Funding Besides the sources of revenue identified to support the Capital Improvement Plan, other non-traditional means may be available, and should be explored. The FAA's Facilities & Equipment division has contributed to navigational aids at Eugene, and is expected to continue to be a funding partner for such improvements. The State of Oregon's ConnectOregon program, which recently funded the airport cargo facility, is expected to be renewed on an approximate biannual basis, and many of Eugene's projects could be candidates for ConnectOregon funds. And although relatively new to the airport environment, 5-15 Eugene Airport Master Plan Update (February 2010)