October 17, 2007

Salina Airport Authority

Board Summary

BWR Corporation engineers were at the October board meeting to present the results of the firm's analysis of the 2007 rainstorms that resulted in the terminal building flooding. The BWR report and modeling provides a very clean review of why the terminal building flooded twice. BWR has also developed a cost effective recommendation for a construction project that would reduce the possibility of future flood damage at the terminal building. The board authorized the Salina Airport Authority to get bids on terminal flooding mitigation. The bids will be turned into FEMA.

Above is an aerial photo that shows the location of a new drainage bypass ditch and installation of a new 12" reinforced concrete pipe under the terminal building's west walkway.

The last month of the financial quarter brought about several significant changes to our Statement of Net Assets. The increase in cash during the month is a result of closing and taking delivery of the proceeds on the 2007-A General Obligation Temporary Notes. The proceeds are being invested in a combination of the Kansas Pooled Money Investment fund and local banks in order to generate the maximum return on the funds while maintaining liquidity for project costs over the next 12-18 months. All interest income will be used for future debt service payments. Also, with the closing of the temporary notes, you will notice the increase in long-term debt from $9.8 to $20.6 million.

Since June, passenger enplanements have remained above the 220-level. Interested air carriers have noticed the Salina/Saline county area response to the nonstop flights. Air Midwest has adjusted the departure time of the afternoon flight, which will offer better connections at Kansas City. Total annual boardings should exceed 2,300.

The September 2007 operations totaled 8,637, which was just 55 takeoffs and landings less than in September 2006 total of 8,692. We have realized a positive increase in the number of military itinerant and military local operations.

Year-to-date fuel flowage is tracking 2% ahead of the same period last year. Both America Jet and Kansas State University are ahead of last year by 13% and 5% respectively.