Draft EUG Master Plan Update, February 2010

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CHAPTER 5 FINANCIAL FEASIBILITY ANALYSIS Table 5-8 provides a debt service schedule for bonds issued in FY 2010 for the Terminal Phase II project, Concourse B expansion, and Access Road improvements projects. In addition, this table assumes that in FY 2014 additional bonds will be issued for the Concourse C – Phase I expansion. These debt service assumptions are tracked in Table 5-3 in the annual “Required PFC Fund” calculations along with projects scheduled to be completed on a pay-as-you-go basis. For purposes of this analysis, it is assumed that an overall interest rate of 4.75 percent is obtained for these borrowings and a payback period of 20 years is utilized. Collectively, these bond packages will entail the issuance of approximately $19.8 million and will require the use of PFC revenues totaling approximately $1.02 million in Fiscal Years 2011-2013 and Table5-9 $1.54 million per year thereafter to achieve retirement. As noted on Table 5-3 and , the Airport is expected to generate sufficient PFC revenues to retire both this debt as well as fund other PFC pay-as- you-go projects anticipated for construction during this plan. Table 5-8 also proposes that bonds for the Phase I Passenger Parking Expansion and construction of the Airport administration space be issued in FY 2010 resulting in debt of approximately $357,000 per year to be paid from general Airport revenues. With the issuance of these bonds, the aggregate annual debt service required for these Airport projects will range from $357,000 to $1.9 million per year during the planning period. As depicted in Table 5-9, it is expected that sufficient revenue will be generated to support these borrowings and provide annual deposits to the Airport’s Operating and Capital Reserve Fund. 7. Cash Flow Analysis and Overall Feasibility This section sets forth a discussion of the Airport’s projected cash flow from Operating Activities (Table 5- Table 5-10) 9)and its proposed Capital Improvement Plan (for the period FY 2009 through FY 2016. The purpose of presenting these cash flow analyses is to demonstrate the Airport’s ability to generate revenue sufficient to cover operating expenses and produce net revenue from operating activities through FY 2016. It further demonstrates that sufficient AIP funds, PFC revenues, and local Operating and Capital Reserves will be available to implement the recommended CIP through FY 2016. In Table 5-9, projected Airport expenses are subtracted from projected Airport revenues, including transfers of sufficient PFC revenue for eligible debt service, on an annual basis through 2016 to estimate the Airport’s net revenue in each of these years. From this net revenue, the Airport is required to make debt service payments and deposits to its Operating and Maintenance (O&M) Reserve Fund. This fund is required by the City and is to hold a balance equal to two months of the Airport’s projected operating expenses in each year. Since the Airport is expected to hold approximately $1.047 million in this fund as of FY 2009, additional deposits are not required to meet this two-month requirement until FY 2012, assuming the attainment of the projected Airport operating expenditure levels presented in Table 5-7. Total projected annual debt service payments on the proposed FY 2010 and FY 2014 borrowings are subtracted from the Airport’s net revenue to calculate the Airport’s Net Remaining Revenue Available for deposit. Once these obligations are accounted for, all remaining net income is available for deposit in the Airport’s Operating and Capital Reserve Fund. 5-27 Eugene Airport Master Plan Update (February 2010)