Official Statement Airport Commission City and County of San ...

Special Facility Bonds
The Commission may (a) designate an existing or planned facility, structure, equipment or other property,
real or personal, which is at the Airport or part of any facility or structure at the Airport as a Special Facility, (b)
provide that revenues earned by the Commission from or with respect to such Special Facility shall constitute
Special Facility Revenues and shall not be included as Revenues, and (c) issue Special Facility Bonds for the
purpose of acquiring, constructing, renovating, or improving such Special Facility. The designation of an existing
facility as a Special Facility therefore could result in a reduction in the Revenues of the Airport. Principal, purchase
price, if any, redemption premium, if any, and interest with respect to Special Facility Bonds shall be payable from
and secured by the Special Facility Revenues, and not from or by Net Revenues.
No Special Facility Bonds may be issued by the Commission unless an Airport Consultant has certified:
(i) that the estimated Special Facility Revenues with respect to the proposed Special Facility will be at least
sufficient to pay the principal, purchase price, interest, and all sinking fund, reserve fund and other payments
required with respect to such Special Facility Bonds when due, and to pay all costs of operating and maintaining the
Special Facility not paid by a party other than the Commission; (ii) that estimated Net Revenues calculated without
including the Special Facility Revenues and without including any operation and maintenance expenses of the
Special Facility as Operation and Maintenance Expenses will be sufficient so that the Commission will be in
compliance with its rate covenant during each of the five Fiscal Years immediately following the issuance of the
Special Facility Bonds; and (iii) no Event of Default under the 1991 Master Resolution exists.
SFO FUEL Bonds. The Commission has two outstanding issues of Special Facility Bonds, which were
issued to finance the construction of jet fuel distribution and related facilities at the Airport for the benefit of the
airlines: $86,465,000 Airport Commission of the City and County of San Francisco, San Francisco International
Airport Special Facilities Lease Revenue Bonds (SFO FUEL COMPANY LLC), Series 1997A (AMT); and
$15,915,000 Airport Commission of the City and County of San Francisco, San Francisco International Airport,
1997 Special Facilities Lease Revenue Bonds (SFO FUEL COMPANY LLC), Series 2000A (collectively, the “SFO
FUEL Bonds”). The SFO FUEL Bonds are payable from and secured by payments made by a special purpose
limited liability company (“SFO Fuel”) pursuant to a lease agreement between the Commission and SFO Fuel with
respect to the jet fuel distribution facilities. SFO Fuel was formed by certain airlines operating at the Airport,
including United Airlines, which were its initial members. The lease payments, and therefore the SFO FUEL
Bonds, are payable from charges imposed by SFO Fuel for into-plane fueling at the Airport, and are not payable
from or secured by Net Revenues. The SFO FUEL Bonds are further secured by an Interline Agreement (the
“Interline Agreement”) among the participating airlines, including United Airlines, under which the participating
airlines are obligated to make payments to SFO Fuel equal to its total net costs, including the lease payments due to
the Commission with respect to the SFO FUEL Bonds. All airlines operating at the Airport are required to have
aviation fuel delivered to their aircraft through the jet fuel distribution facilities of SFO Fuel. See also, “CERTAIN
RISK FACTORS–Uncertainties of the Aviation Industry.”
For a description of the jet fuel distribution and related facilities at the Airport, see “SAN FRANCISCO
AIRPORT–Current Airport Facilities–Jet Fuel Distribution System.”
Alternate Credit Facilities
If the Bank does not extend the Letter of Credit, or the Bank or the Commission terminates the Letter of
Credit in accordance with its terms and the terms of the Reimbursement Agreement, then the Commission will use
commercially reasonable efforts to obtain an Alternate Credit Facility to replace the Reimbursement Agreement or
to convert the interest rate on the 2010A Bonds to a Non Covered Interest Rate. The Commission is authorized
under the 1991 Master Resolution to provide for the delivery of an Alternate Credit Facility. See “DESCRIPTION OF
THE 2010A BONDS–Optional and Mandatory Tenders for Purchase–Mandatory Tenders for Purchase–Mandatory
Tender for Purchase Upon Substitution, Modification or Reduction of Credit Facility or Liquidity Facility” and
“–Notice of Substitution of Credit Facility or Liquidity Facility Without Mandatory Purchase.”
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