SAN FRANCISCO AIRPORT COMMISSION MINUTES

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A. CALL TO ORDER: AIRPORT COMMISSION MEETING MINUTES April 20, 2010 The regular meeting of the Airport Commission was called to order at 9:05 AM in Room 400, City Hall, San Francisco, CA. B. ROLL CALL: Present: C. ADOPTION OF MINUTES: * * * Hon. Larry Mazzola, President Hon. Linda S. Crayton, Vice President Hon. Caryl Ito Hon. Eleanor Johns Hon. Rich Guggenhime * * * The minutes of the regular meeting of April 6, 2010 were adopted unanimously. No. 10-0153 K. CLOSED SESSION: * * * Discussion and vote pursuant to Brown Act Section 54957.1 and Sunshine Ordinance Section 67.11 on whether to conduct a Closed Session. The Commission voted unanimously to go into closed session. The public meeting was recessed at 9:09 AM and the closed session began. The Airport Commission will go into closed session in accordance with Government Code Section 54956.9(b) to confer with legal counsel regarding potential litigation. Discussion and vote pursuant to Brown Act Section 54957.1 and Sunshine Ordinance Section 67.14 on whether to disclose action taken or discussions held in Closed Session. The Commission reconvened its public session at 9:25 AM. The Commission determined that it was not in the public interest to disclose the nature of the closed session and voted unanimously not to disclose it. * * * D. ITEMS INITIATED BY COMMISSIONERS: Minutes, April 20, 2010, Page 4
There were no items initiated by Commissioners. * * * E. ITEMS RELATING TO ADMINISTRATION, OPERATIONS & MAINTENANCE: Item No. 1 was moved by Commissioner Guggenhime and seconded by Commissioner Crayton. The vote to approve was unanimous. 1. Approval of the Airport’s Five Year Financial Plan No. 10-0154 Resolution approving the Airport’s Five-Year Financial Plan. Mr. Leo Fermin, Deputy Director, Business and Finance, explained that as a result of a voter approved initiative, all enterprise departments have been requested to submit five-year financial plans to the Mayor and the Board of Supervisors. Our five-year financial plan uses as a starting base the operating budget and the capital plan which the Commission previously approved. The financial plan is a living document used for planning purposes at the Airport. We will adjust on an ongoing basis to reflect changes in the Airport’s financial outlook. There will likely be adjustments to the plan when it is submitted to the Board of Supervisors to reflect adjustments to salaries and fringes by the Controller’s office and other technical adjustments to next year’s budget. The financial plan contains several elements. It describes the financial governance of the Airport, it’s residual rate making structure, strategic focus, and major challenges. It explains the unique nature of the annual service payment. It shows the five year air traffic forecast. Enplanements are forecasted to increase from $18.2 million in FY08/09 to $21 million in FY14/15. The financial plan also describes the various revenues and expenses of the Airport and the elements that were used for the forecast over the five year period. And finally, the financial plan also briefly describes the current five year plan as approved by the Airport Commission. This five year plan results in the following: • It achieves a balanced budget during the five year forecast period; • It generates debt service coverage of 1.38 or more each year. This exceeds the 1.25 requirement in our master bond indenture; • The forecast also provides for funding for Airport priorities and strategic initiatives and; • Finally, most importantly it achieves the CPE goal. CPE is forecast to be $18.32 or less each year in constant dollars over the five year period, which is below the $18.90 limit established by the Airport Director. Commissioner Ito noted that page 9 indicates that we have surplus and asked how that gets applied in future years back to the Airline. Mr. Fermin explained that when we set rates and charges each year, we forecast what our revenues will be and what our expenses will be and that is used as the basis for determining the airline requirement, what we need to collect from the airline in rates and charges. Then, once the year actually ends and we get the true expenses and the true revenues, there maybe a deficit or a surplus. If there is a surplus, we then credit that back to the airlines in future years. It’s an ongoing Minutes, April 20, 2010, Page 5
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SAN FRANCISCO AIRPORT COMMISSION MINUTES

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