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

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The table below summarizes the interest rate swap agreements entered into by the Commission. SUMMARY OF INTEREST RATE SWAP AGREEMENTS Initial Counterparty/ Guarantor Fixed Rate Associated Effective Notional Credit Ratings Payable by Market Value to Expiration Bonds Date Amount Counterparty/Guarantor (Moody’s/S&P/Fitch) (1) Insurer Commission Commission (1) Date Issue 36A/B 3.444% ($4,688,628.47) May 1, 2026 02/10/05 $70,000,000 J.P. Morgan Chase Bank, N.A. Aa1/AA-/AA- FGIC/National (2) 02/10/05 69,930,000 J.P. Morgan Chase Bank, N.A. Aa1/AA-/AA- FGIC/National (2) 3.445 (4,690,077.14) May 1, 2026 Subtotal Issue 36A/B 139,930,000 (9,378,705.61) Issue 36C 3.444 (2,009,412.20) May 1, 2026 02/10/05 30,000,000 Bear Stearns Capital Markets Inc./ Aa3/A+/AA- Assured (2) J.P. Morgan Chase Bank, N.A. Issue 36D 3.445 (2,010,033.06) May 1, 2026 02/10/05 29,970,000 Bear Stearns Capital Markets Inc./ Aa3/A+/AA- Assured (2) J.P. Morgan Chase Bank, N.A. Issue 37B 3.898 (9,345,931.51) May 1, 2029 05/15/08 79,684,000 Merrill Lynch Capital Services, Inc./ A2/A/A+ Assured (3) 78 Merrill Lynch & Co. Issue 37C 05/15/08 89,856,000 Bear Stearns Capital Markets Inc./ Aa3/A+/AA- Assured 3.898 (10,538,993.26) May 1, 2029 J.P. Morgan Chase Bank, N.A. 2010A 3.895 (8,606,544.13) May 1, 2030 02/01/10 71,973,000 Depfa BANK plc, New York Branch A3/BBB/A- (4) 02/01/10 143,947,000 Goldman Sachs Group, Inc. Aa3/A/A+ 3.925 (17,211,759.37) May 1, 2030 Subtotal 2010A 215,920,000 (25,818,303.50) OTAL $585,360,000 ($59,101,379.14) __________________ (1) As of. January 15, 2010. Ratings are provided for convenience of reference only. Such rating information has been obtained from sources believed to be reliable but has not been confirmed or reverified by the rating agencies. None of the Commission or the Underwriters takes any responsibility for the accuracy of such ratings, or gives any assurance that such ratings will apply for any given period of time, or that such ratings will not be revised downward or withdrawn if, in the judgment of the agency providing such rating, circumstances so warrant. (2) The Issue 32A/B/C Bonds that were hedged by these swap agreements were purchased with proceeds of the Issue 36A Bonds and the Issue 36B Bonds and are held in trust. (3) The Issue 37B Bonds that are hedged by this swap agreement were purchased with proceeds of the Series 2008B Notes and the Issue 37B Bonds are held in trust. (4) Given the decline in ratings for DEPFA, the Airport and its advisors have reviewed this interest rate swap agreement in contemplation of a potential optional termination by the Airport. Instead, the Airport has negotiated more favorable terms with respect to this swap which will remain in effect until such time as DEPFA’s ratings recover adequately. These measures include the posting of collateral by DEPFA in an amount in excess of $4 million, even though that swap currently has a favorable termination value to DEPFA as of January 15, 2010.
Operating Expenses Fiscal Year 2008-09 operating expenses of $478 million reflected a 6.1% increase from Fiscal Year 2007-08 operating expenses of $451.3 million. The operating expenses in Fiscal Year 2006-07 were $431.1 million. See also “AIRPORT’S FINANCIAL AND RELATED INFORMATION.” The increase in total operating expenses in Fiscal Year 2008-09 in the amount of $27.3 million was primarily due to base wage increases required by various Memoranda of Understanding between the City and the various bargaining units ($14.3 million), an increase in other post-employment benefit obligations ($1.4 million), increases in depreciation and amortization due to the addition of capital assets placed in service ($7.1 million), increases in contractual service costs as a result of increase expenditures in international marketing services by the San Francisco Visitors Bureau and cost escalation in the New Park South Parking services contract and operation of the SFO shuttle bus service ($3.3 million). Review and Adjustment to Operating Expenditures Each quarter, the Airport produces a financial forecast for the operating budget. If this forecast projects that the operating budget will be in a deficit by the end of the Fiscal Year, Airport management has historically implemented cost control measures. These cost control measures have included, but are not limited to workforce reductions or hiring freezes on positions except those that have a direct impact on safety and security, and cuts in discretionary expenditures, such as professional service contracts. Payments to the City Annual Service Payment Under the Lease Agreements and the Settlement Agreement with certain airlines, the Commission makes an “Annual Service Payment” to the City to compensate the City for certain indirect services and facilities that it provides to the Airport and the Commission. See “SAN FRANCISCO INTERNATIONAL AIRPORT–Existing Airline Agreements–Lease Agreements.” The Annual Service Payment is equal to the greater of (i) $5 million, and (ii) 15% of “Concession Revenues” (as defined in the Lease Agreements), and is paid by the Commission in quarterly installments. The Annual Service Payment is made only after the payment of Operation and Maintenance Expenses and debt service on outstanding revenue bonds of the Commission, including the Bonds, and certain other expenditures. See “SECURITY FOR THE 2010A BONDS–Flow of Funds.” The amount of Annual Service Payment for each of the last five fiscal years is set forth below. There is no assurance that upon renewal of the Lease Agreements, that the FAA will permit the Annual Service Payment to continue. See “San Francisco International Airport–Existing Airline Agreements–Lease Agreements.” See “AIRPORT’S FINANCIAL AND RELATED INFORMATION–Historical Debt Service Coverage.” Payments for Direct Services In addition to the Annual Service Payment, the Lease Agreements and the Settlement Agreement permit the Commission to compensate the City’s General Fund for the cost of certain direct services provided by the City to the Airport, including those provided by the Police Department, the Fire Department, the City Attorney, the City Treasurer, the City Controller, the City Purchasing Agent and other City departments. Set forth in the table below is a summary of the payments made by the Airport to the City for the last five Fiscal Years. The Commission is otherwise prohibited under the Settlement Agreement and the Lease Agreements from making any payments to the City, directly or indirectly. See “SAN FRANCISCO INTERNATIONAL AIRPORT–Certain Federal, State and Local Laws and Regulations–Federal Law Prohibiting Revenue Diversion.” 79
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SAN FRANCISCO INTERNATIONAL AIRPORT
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2010A BONDS MATURITY SCHEDULE The i
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Information Provided by the Commiss
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Page Page VERIFICATION OF MATHEMATI
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The 2010A Bonds will be secured by
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Maturity Date (May 1) 2011 2012 201
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Interest on the 2010A Bonds will be
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Mandatory Sinking Fund Redemption T
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Redemption of Credit Provider Bonds
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SPECIAL CONSIDERATIONS RELATING TO
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“Operation and Maintenance Expens
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Fifth, to pay for necessary reconst
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Letter of Credit Upon the delivery
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Pooled Reserve Account The 1991 Mas
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No Acceleration The Bonds are not s
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LETTER OF CREDIT AND REIMBURSEMENT
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appealable judgment, to be null and
Page 36 and 37: In addition to revenues received fr
Page 38 and 39: In addition to these regulatory act
Page 40 and 41: Each of Moody’s, Standard & Poor
Page 42 and 43: Initiative, Referendum and Charter
Page 44 and 45: Jackson J. Wong was appointed Chief
Page 46 and 47: that supports all airlines in the I
Page 48 and 49: from $1.50 to $4.00. The Airport is
Page 50 and 51: Airport Security In the immediate a
Page 52 and 53: � United Airlines commenced daily
Page 54 and 55: The following table lists the air c
Page 56 and 57: During Fiscal Year 2008-09 approxim
Page 58 and 59: Domestic Enplanements. During Fisca
Page 60 and 61: International Enplanements. Interna
Page 62 and 63: Cargo Traffic and Landed Weight Car
Page 64 and 65: TOTAL LANDED WEIGHT BY AIRLINE †
Page 66 and 67: Settlement Agreement Under the Sett
Page 68 and 69: Expiration of the Settlement Agreem
Page 70 and 71: the beneficiaries (the people of th
Page 72 and 73: Hazardous Material Management Envir
Page 74 and 75: SUMMARY OF AIRPORT FINANCIAL RESULT
Page 76 and 77: Aviation Market Stimulus Program In
Page 78 and 79: On November 21, 2006, Travelex, the
Page 80 and 81: PRINCIPAL AIRPORT CONCESSIONAIRES
Page 82 and 83: Off-Airport Parking Facilities Seve
Page 84 and 85: INTEREST RATE SWAP POLICY MAXIMUM N
Page 88 and 89: SUMMARY OF PAYMENTS MADE BY THE AIR
Page 90 and 91: Voter Approved Changes to the Retir
Page 92 and 93: A decline in the actuarial value of
Page 94 and 95: Postemployment Health Care Benefits
Page 96 and 97: Under the Treasurer’s current inv
Page 98 and 99: Debt Service Requirements The follo
Page 100 and 101: Current and Future Financings Capit
Page 102 and 103: Other Matters In the regular course
Page 104 and 105: federal, state or local tax liabili
Page 106 and 107: MISCELLANEOUS This Official Stateme
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Introduction APPENDIX B INFORMATION
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APPENDIX C SUMMARY OF CERTAIN PROVI
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Closing Date means the date upon wh
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Interest Payment Date means each da
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the Trustee for cancellation; (b) B
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payment agreement with the United S
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Special Facility means any existing
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Revenue Fund; Allocation of Net Rev
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Moneys in the respective accounts i
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Investments are allocated. Amounts
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Subordinate Bonds The Commission ma
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act or thing the effect of which wo
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filing of any such petition or to t
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moneys, funds and properties pledge
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The recitals, statements and repres
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The Trustee or the Paying Agent, as
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to or greater than the Credit Facil
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(a) such 2010A Bonds sold by the Re
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The Remarketing Agent The Remarketi
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APPENDIX D SUMMARIES OF CERTAIN PRO
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computations made in accordance wit
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APPENDIX E SUMMARY OF CERTAIN PROVI
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statement, it must be available fro
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Duties, Immunities and Liabilities
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APPENDIX F INFORMATION REGARDING TH
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Ambac Assurance’s consolidated fi
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Capitalization of AGM At September
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The available amount of each MBIA s
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complaint also alleges that certain
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APPENDIX G PROPOSED FORM OF OPINION
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APPENDIX H JPMORGAN CHASE BANK, NAT
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The Available Amount (as hereinafte
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JPMorgan Chase Bank, National Assoc
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IN WITNESS WHEREOF, this Certificat
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(ii) $_______________________ is de
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The undersigned Transferor acknowle
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The Bank of New York Trust Company,
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The Bank of New York Trust Company,
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