Draft EUG Master Plan Update, February 2010

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SUPPLEMENTAL FINANCIAL ANALYSIS APPENDIX B Historical and Projected Airport Operating Expenses Chapter 5 also analyzes historical and projected operating expenses for EUG in Tables 5-6and 5-7. When this plan was originally published, it was expected that total operating expenses would equal $6.3 million in FY 2008 and $6.6 million in FY 2009. Actual results for these two (2) fiscal years were $5.9 million and $6.3 million respectively; both significantly below forecast. As previously noted, salaries and labor drove the majority of expenditure increases between FY 2008 and FY 2009 due to increases in salaries and the addition of 3 full-time equivalent positions for the Maintenance Division. The following presents the annual compounded annual growth rates in overall Airport expenses for the period FY 2003- 09, FY 2006-10 (Budget) and FY 2008-10 (Budget): FY 2003-09 FY 2006-10 FY 2008-10 Total Airport Expenses 4% 6% 8% Major expenditure variables between FY 2008 and FY 2010 generated the annual increase of 8 percent for this period: Salaries & labor increased $368,000 Benefits increased $114,000 Materials & Supplies increased $100,000 Contractual Services increased $269,000 Central Allocation Services increased $150,000 EUG, like many local governing bodies, is experiencing significant and ongoing increases in employee benefit costs as contributions to health insurance plans and defined benefit plans continue to rise. Although these expenditure categories are growing significantly, personnel expenditures (salaries and labor and benefits) comprise 56 percent of the Airport’s operating expenses which compares favorably to other local government jurisdictions that oftentimes expend 65-70 percent of budgeted funds on employee compensation and benefits. Although actual operating results for FY 2008-09 were more favorable than expected in the forecast contained in Table 5-6, Airport expenses continued to grow at an annualized rate of 4 percent for the period FY 2003 – FY 2009. For the forecast period of FY 2011 – FY 2015, Table 5-7 projects that Table B-6 and expenditures will grow at an annualized rate of 4 percent from $7.2 million to $8.8 million. B-7 , which unlike Chapter 5 does not anticipate additional positions to be added to Airport staff during this period, indicates that overall Airport expenditures will total $7.7 million by the end of this period yielding a savings of $1.1 million over the original forecast. B-10 Eugene Airport Master Plan Update (February 2010)