2004 Financial Report - Tampa International Airport

2 0 0 4 

Excellence 

by 

Design 

Annual Report

Alfred S. Austin 

Chairman 

Louis E. Miller 

Executive Director 

n organization has to pursue 

excellence, in order to achieve it. 

We are proud that Tampa International 

Airport has a global reputation for designing 

and implementing exceptional goals and 

plans. We know that achieving excellence 

takes high objectives, such as providing 

world-class transportation and world-class 

facilities; it takes sincere efforts to ensure 

convenience and efficiency; intelligent 

direction to provide a safe and secure 

environment; expert execution to implement 

a cost competitive structure; and a 

vision to see obstacles as opportunities. 

These long-term strategic initiatives were 

created for guiding the future of Tampa 

2 

A 

Leadership 

International Airport and its three reliever airports: Peter O. Knight, 

Vandenberg and Plant City. These high objectives are the vision of the outstanding 

men and women of the Hillsborough County Aviation Authority. 

It has been an exceptional year for Tampa International Airport’s ongoing 

$790-million capital improvement program. Construction continues on the 

Airport’s largest airside terminal building – C. At an overall cost of $134.8 

million, the 315,000-square-foot, 16-gate facility is on budget and on time, 

scheduled for completion in April 2005. 

Also this year, a highly significant construction project was completed. On 

June 24, 2004, the Airport’s new $124-million baggage handling system 

was completed and Tampa International Airport became one of the few 

large hub airports in the United States to implement a new multi-user, 

in-line baggage handling system that is fully integrated with 

21 federally required Explosive Detection Systems (EDS) 

machines, making it 100 percent operational for screening 

all checked baggage at the Airport. 

The Tampa Bay Area is one of the nation’s most dynamic 

and prosperous regions and travelers love to visit. During 

Fiscal Year 2004, over 16.9 million passengers used Tampa 

International Airport, representing a 10.63 percent increase 

from the previous year. Tampa experienced 10 months of 

record-breaking passenger traffic during the year, always 

performing higher than the national average. 

This year, operating revenues increased by 8.7 percent to 

$137.4 million while operating expenses increased by 5.8 

percent to $65.7 million. The increase in operating 

expenses, while well within budgeted amounts, was a 

result of additional security measures required by the 

Transportation Security Administration, and necessary 

expenditures to maintain high service levels. During the year, 

the Aviation Authority invested $152.5 million in facility 

improvements, land and equipment. In support of its ongoing 

capital development program, the Authority received 

$33.6 million in Passenger Facility Charges (PFC) and $25.2 

million in Federal and State Grants and generated $30.9 million 

from operations in FY 2004. 

The final cost for airlines serving Tampa was $4.21 per 

enplaned passenger and it continues to be well below the 

industry average for large hub airports, which represents 

the Aviation Authority’s commitment to cost containment 

efforts in controlling expenditures. 

For the fourth year, Tampa International Airport had the 

privilege of receiving high votes from passengers, placing it 

among the world’s best for overall passenger satisfaction. 

The J. D. Power and Associates 2003 Global Airport 

Passenger Satisfaction Study selected Tampa International 

Airport as the fourth highest in overall passenger satisfaction 

in the mid-sized category. Just behind Singapore’s Changi 

International and Hong Kong’s Chek Lap Kok, Tampa 

International Airport placed second highest in the U.S. — 

one point behind Pittsburgh International Airport. 

The talented Tampa International Airport employees form this 

essence of excellence. They are the ones committed to the 

daily dedication of providing comfort, safety, convenience and 

well-being to the Airport’s customers and ultimately, responsible 

for the above-average passenger satisfaction ratings. 


Chairman 



3

4 

Stephen J. Mitchell 

Vice Chairman 

Partnership 

Hillsborough County 

Commissioner 

Thomas Scott 

Treasurer 


Chairman 

Board Members Staff Roster 

Ken Anthony 

Secretary 

Tampa Mayor 

Pam Iorio 

Assistant Secretary/ 

Assistant Treasurer 



John Wheat 

Deputy Executive Director 

Linda Greif 

Administrative Assistant 

to the Executive Director 

Don Whitworth 

Director of Performance 

Management and Internal Audit 

George A. Elbe 

Director of 

Air Service Development 

and International Commerce 

Edward B. Cooley, III 

Senior Director of Operations 

and Public Safety 

Gigi Skipper 

General Counsel 

Director of Legal Affairs 

Don C. Welch 

Director of Human Resources 

Brenda S. Geoghagan 

Director of Public Information 

and Community Relations 

Louis P. Russo, Jr. 

Senior Director of Planning 

and Development 

Ann Davis 

Director of Finance 

Diane Pryor-Vercelli 

Senior Director of Properties 

and Contracts Administration 

Al Illustrato, Jr. 

Senior Director of Maintenance 

Ted W. Leslie 

Director of Properties and 

Contracts Administration 

Sharon Weaver 

Director of Administration 

and Information Technology 

Robert J. Burr 

Director of Operations 

Joseph H. Hills 

Director of Parking and 

Ground Transportation 

James W. Jones, Jr. 

Director of Engineering 

Rudolph R. Mueller, III 

Director of Architecture 

John Allen 

Director of Construction 

Nadine S. Jones 

Director of Planning and 

Noise Compatibility Programs 

Edward R. Haines 

Director of Development 

Program Services 

Paul F. Sireci 

Chief of Police 

Gary Houts 

Director of Maintenance 

5

Year In Review 

2003 

October 

• Gordon Bethune, chairman of the board 

and CEO of Continental Airlines, is named 

the recipient of the 2004 Tony Jannus 

Award, which recognizes an individual who 

has made significant contributions to commercial 

aviation. 

November 

• Air Canada initiates service to Montreal 

Dorval with two weekly departures. 

• Tampa International Airport reinforces its 

“good neighbor” policy as construction is 

completed on a $5.9-million engine run 

up enclosure. 

December 

• Laker Airways returns to Tampa with two 

weekly departures to Freeport, Bahamas. 

• Tampa International Airport joins the aviation 

community around the world in commemorating 

the centennial celebration of the 

Wright Brothers historic flight at Kitty Hawk, 

North Carolina on December 17, 1903. 

2004 

January 

• JetBlue Airways increases service from Tampa, 

by offering two daily departures to Boston, MA. 

• Bahamas Air initiates service to Freeport, 

Bahamas with two daily departures. 

6 

Accomplishments 

• Sun Country offers seasonal service between Minneapolis and Tampa with one 

daily departure. 

• In response to a renewed surge in passenger traffic, the Aviation Authority revives 

plans to construct an economy parking garage. The garage will add 3,966 spaces 

by Thanksgiving 2005 and an additional 1,705 in 2006. 

February 

• AirTran expands service from Tampa with daily nonstop service to Akron/Canton. 

• Midwest Airlines expands its seasonal service between Tampa and Milwaukee 

with an additional daily departure. 

• Northwest Airlines adds service to two Michigan cities – one daily departure each 

to Flint and Grand Rapids. 

• In the 2003 Global Airport Satisfaction Study, J.D. Power and Associates awards 

Tampa high honors, recognizing it as #2 in the U.S. and #4 in the world for 

overall passenger satisfaction. 

March 

• United Airlines introduces Ted, its low cost carrier, to the Tampa Bay area and 

launches service between Tampa and Denver with three daily departures. 

• Continental Airlines offers new service to connect Tampa with two other Florida 

cities: two daily departures to Fort Myers and one to Sarasota/Bradenton. 

May 

• Tampa International Airport is named 7th in the nation in rental car revenue. 

• Southwest Airlines extends “Brotherly Love” to Tampa with daily nonstop service 

to Philadelphia, PA. 

• With another record-breaking month of passenger traffic, Louis Miller announces 

Tampa International Airport is “all the way back” from September 11th. The airport 

will continue to exceed pre-9/11 passenger traffic numbers for the remainder 

of the year. 

June 

• Tampa International Airport reaches another milestone in passenger convenience 

with the completion of the 100 percent in-line explosive detection system. The 

$124-million baggage handling system makes TPA the second large airport in the 

nation to go completely in-line, the first with multi-user capabilities. 

• The aviation community mourns the passing of George J. Bean, Executive 

Director of Tampa International Airport from 1965 to 1996. Mr. Bean is credited with 

a lifetime of service to aviation organizations worldwide and the revolutionary 

design of Tampa International Airport. 

July 

• Tampa International Airport fills another niche in customer service with the opening 

of an observation deck at Airside D. The deck allows smokers to step outside 

and indulge before boarding an aircraft, without having to go back and forth 

through security. Additional patios open later in the year at Airsides A, E and F. 

August 

• To increase customer convenience at Baggage Claim, large-scale dynamic flight 

information signage is added to the Arrival Drive. Drivers meeting arriving passengers 

can check flight status without leaving their vehicles. 

• Hurricane Charley bears down on West 

Central Florida, soon to be followed by 

Frances, Jeanne and Ivan, impacting flight 

operations statewide for 44 days. Thanks to 

preparation and an unprecedented cooperative 

effort by the Airport and tenants, the 

storm season concludes without substantial 

damage (approximately $2.2 million) to 

Tampa International and its three general 

aviation airports. 

• Providing airport passengers and visitors 

with a higher level of convenience and 

information, the new Tampa International 

Airport website is launched. 

• Tampa International joins a few select airports 

on the cutting edge of security with the 

installation of a GE Ion Tracker trace detection 

portal. The explosive detection system 

is part of a TSA test program. 

September 

• Delta Air Lines announces a shift in hub 

operations. The result is the first nonstop 

flights from Tampa to Salt Lake City, 

Greensboro, NC and Dayton, OH. 

Additional service to Raleigh-Durham and 

Pensacola is planned. 

• Southwest Airlines adds new nonstop service 

between Tampa and Buffalo, NY. 

• Official opening of Tampa International Jet 

Center, the Airport’s second Fixed Base 

Operator. 

7

T 

he Aviation Authority is moving forward 

with its ongoing $790-million 

capital improvement program. Recognizing 

the environmental impact airport growth 

has on a community and the need to design 

reasonable mitigation measures that address 

noise, wetlands, stormwater management 

and other environmental issues are always 

primary concerns of the Aviation Authority. 

The Planning and Development Department 

reported 23 completed projects for FY 

2004. Of these projects, 96 percent were 

reported on time and on budget. 

Taxiway W, High Speed Exit 

Runway 36 Left/18 Right is the Airport’s 

most western north/south runway and 

the closest to Tampa Bay, handling nearly 

75 percent of all jet operations. The $9million 

construction of a high-speed taxiway 

and taxiway improvements near the 

south end of Runway 36 Left offers a significant 

benefit to Airport neighbors. It 

enables landing aircraft to exit the runway 

more quickly, thereby allowing more aircraft 

to land on 36 Left. As a result, fewer 

aircraft will need, or want, to land on 

Runway 36 Right (parallel runway to 36 

Left), keeping aircraft over the water and 

reducing noise impacts in the future. 

Progress 

The Aviation Authority working in cooperation with the contractors reduced 

the scheduled runway closure from 64 days to 43 days. 

Baggage Handling System 

On June 24, 2004, Tampa International Airport became one of the few 

large hub airports in the United States to implement a new multi-user in-line 

baggage handling system that is fully integrated with 21 federally required 

explosive detection systems (EDS), making it 100 percent operational for 

screening all checked baggage at the Airport. 

The $124-million baggage system has the capability to expand to 25 EDS. The 

processing rate is six (6) bags per minute for each EDS. The system has eight 

miles of conveyor belts and 3,000 electric motors and gear boxes. The total 

electrical cost is approximately $1 million annually, generating enough power to 

operate 500 average-sized homes. The system operates 20 hours per day 

and processes 35,000 bags in a peak day at the current passenger level. 

Completing this project has increased efficiency and passenger satisfaction 

of the Airport’s baggage systems. 

New Flight Information Signage 

Large-scale, large-letter electronic flight displays were installed on each of 

the four elevator core exterior walls at the Red (north) and Blue (south) 

Arrival Drives, displaying flight information visible to pedestrians, motorists 

and traffic personnel. 

Exterior Dynamic Signage 

The Airport has installed 10 new Dynamic Signs (computer variable messages) in 

order to communicate with Airport visitors by roadway messaging. Eight were 

installed on the George J. Bean Parkway, providing real-time traffic and directional 

information for travelers approaching the main terminal building and 

garage facilities. The total cost for the Dynamic Signage project is $2.1 million. 

Residential Sound Insulation Program 

A $3.2-million project to sound insulate 33 residential houses impacted by aircraft 

noise was completed this year. It included replacing doors and windows with 

acoustically rated insulation products, adding insulation in attics, gypsum 

board on walls and ceilings and replacing air-conditioning equipment. 

Service Building Expansion and Modifications 

Work has started on the $14.9-million design-build expansion and modification 

to the service building adjacent to the main terminal building. The facility is home 

to the Communication Center, Police Department, Planning and Development, 

Parking and Ground Transportation, General Aviation, Maintenance, Operations, 

airport identification badging office and an employee cafeteria. The expansion 

adds 31,500 square feet, reconfigures the second floor area and modifies the 

first floor facilities. 

The Police Department has already moved into its new space in the service building, 

featuring a modern dispatch center, crisis command center, administrative space 

and four holding cells. This project is scheduled for completion in July 2005. 

Disadvantaged Business Enterprise 

(DBE) Program 

The Properties and Contracts Department 

has been focusing on updating and 

improving the DBE program to assist 

with the Airport’s Capital Development 

Program. 

This year, 40 firms were eligible for 

recertification, 10 new firms were added 

to the directory and 299 affidavits were 

processed for continuing eligibility. A 

Reciprocal Certification Program with 

Florida Department of Transportation 

(FDOT) was established and six have 

been certified. 

Additionally, outreach activities included 

participation with the Tampa Urban 

League Conference, Airport Minority 

Advisory Council (AMAC) 20th Annual 

Conference, MED Week Planning 

Committee, George Edgecomb Awards 

Banquet, Regional Task Force Vendor’s 

Meeting, Airside C DBE Informational 

Meeting and Florida Minority Supplier 

Development Council (FMSDC) Outreach. 

A consultant has been selected to assist 

the Authority in conducting a Disparity 

Study in 2005. 

8 9

Momentum 

n July 1988, the Master Plan Update 

identified areas adjacent to Tampa 

International Airport that will, according 

to projections, be needed by the Aviation 

Authority for airport expansion in the 

future. Therefore, it was necessary for the 

Authority to establish a land acquisition 

program, implemented as federal funds 

became available. 

To date, parcel acquisitions and the total 

acreage acquired are 83 percent complete 

(240 parcels out of 288 and 171 

acres out of 205). Five blocks representing 

over 20 parcels and owned entirely by 

the Authority have been consolidated 

and now are identified by two folio numbers. 

This assemblage is taking place to 

assist development planning as well as 

minimize potential costs in environmental 

remediation activities. 

Airside C 

Construction started January 2004 and 

continues on time and on budget for 

the new $134.8-million, 16-gate, 

315,000-square-foot Airside C. It is the 

second airside terminal to be design-built 

at Tampa International Airport. Beck and 

Alfonso Architects were selected as the 

contractor and designer. 

10 

I 

Southwest Airlines will operate 12 gates, with Spirit Airlines and Independence 

Air using the remaining four gates. HMSHost is creating 13,000 square feet of 

food and beverage concessions, offering Starbucks Coffee, Chili’s, a Tampa Bay 

Sports Bar and 6,000 square feet of retail space. Plus, after traveling through one 

of the eight security screening lanes, families can enjoy a children’s play area. 

Additionally, four artists have been commissioned to provide public art for five 

locations in the terminal. Harrison Covington of Tampa created an eight-foot 

bronze sculpture titled “Barnstormer”. Christopher Still of Tarpon Springs is 

developing an aviation-themed 19-foot-by-13-foot horizontal mural filled with 

historical details regarding the history of the Tampa International Airport. He is 

also fabricating an 80-foot-long aluminum sculpture titled “Q”, which is the 

expression of the dynamic pressure associated with force needed to lift an 

object/airplane. Imitating aircraft aluminum, it has cutouts depicting travelers 

from different time periods. Stephen Robin of Philadelphia is producing “Orange 

Blossom”, a 13 foot by 9 foot by 5 foot aluminum and cement sculpture in 

the round with branches and opening blossoms. Kristin Jones and Andrew 

Ginzel of New York are designing flooring art titled “Specula”, consisting of 

a series of mosaic medallions laid into the white terrazzo floor of the AGT 

shuttle departure lobby. 

Economy Parking Garage 

The design work is complete for a new $71-million, six-level Economy 

Parking Garage which will accommodate approximately 5,500 vehicles. The 

parking garage will be constructed in two phases, from east to west. The 

first two-thirds of the parking garage (Phase I) is scheduled to be completed 

by November 2005. The scheduled completion date for the remaining 

one-third (Phase II) is November 2006. A shuttle bus lane will run down the 

center of the parking garage on the first floor. All parking patrons will take 

elevators down to one of two elevator lobbies/bus stations on the first floor 

to meet the shuttle bus for transportation to the main terminal building. 

The shuttle lobbies on the first floor will be air conditioned and the shuttle 

buses will operate every 10 minutes. 

Three areas in the parking garage have been selected for public art: two 

interior walls, two interior floors and one outside space. The interior areas 

are located in the two shuttle lobbies. The artwork in these locations will 

enhance the environment and travel experience as patrons wait for a shuttle. 

The exterior artwork will be visually appealing to motorists from a distance. 

The Aviation Authority has budgeted $750,000 for this public art project. 

Master Plan Update 

An update of the 1999 Tampa International Airport Master Plan is underway 

in order to define facility enhancements and capacity improvement 

projects that will be required to satisfy demand growth and serve tenant 

needs during the next twenty years. As in the past, the Aviation Authority 

is taking a collaborative approach with 

the master planning process that includes 

airlines, airport tenants and stakeholders, 

the community and the public. 

Tampa International Airport is situated in 

the midst of the Tampa Bay region, Florida’s 

most populous Metropolitan Statistical Area, 

with a permanent population of 2.56 

million. Plus, with Tampa International’s 

primary service area including Hillsborough, 

Pinellas, Pasco, and Hernando counties 

and secondary area including Polk, 

Manatee, Sarasota, Hardee, De Soto, 

Citrus and Sumter counties, it serves 3.97 

million permanent residents. 

With the service area population increasing 

every day, the Master Plan Update addresses 

needs up to the year 2025 and beyond. 

The plan will be complete by January 2006. 

11

Passengers 

Millions enplaned and deplaned 

14.9 

Evaluation 

1999 2000 2001 2002 2003 2004 

Operations 

Thousands of landings and takeoffs 

272.3 

15.9 

277.2 

16.3 

269.8 

15.2 

245.5 

Airline Passenger Traffic* 

Air Cargo 

Millions of pounds 

Mail 

Millions of pounds 

Fiscal Year Enplaned Average Annual Passenger Aircraft Departures Average Passengers 

Ending September Passengers % Change Annual Daily Enplaned Per Departure 

2001 . . . . . . . . . . 8,183,815 . . . . . . . . . 3.0% . . . . . . . . . . . . 109,516 . . . . . . . . . . 300 . . . . . . . . . . . . . . . 75 

2002 . . . . . . . . . . 7,618,598 . . . . . . . . –7.0% . . . . . . . . . . . . . 99,161 . . . . . . . . . . 272 . . . . . . . . . . . . . . . 77 

2003 . . . . . . . . . . 7,660,785 . . . . . . . . . 1.0% . . . . . . . . . . . . . 92,979 . . . . . . . . . . 255 . . . . . . . . . . . . . . . 82 

2004 . . . . . . . . . . 8,465,720 . . . . . . . . 11.0% . . . . . . . . . . . . . 95,541 . . . . . . . . . . 262 . . . . . . . . . . . . . . . 89 

* Data includes major national, regional, charter and foreign-flag passenger carriers (both scheduled and non-scheduled) 

15.3 

231.9 

16.9 

238.1 

1999 2000 2001 2002 2003 2004 

196.9 

48.7 

190.0 

46.3 

151.8 

36.5 

154.0 

178.8 

163.2 

1999 2000 2001 2002 2003 2004 

33.7 34.6 34.7 

1999 2000 2001 2002 2003 2004 

Top 25 Markets 

Twelve Months Ended June 30, 2004 

City Passengers Percent Air Miles 

1 New York . . . . . . . . . . 1,524,180 . . . . . . . . . . 16.92% . . . . . . . . 1,004 

2 Chicago . . . . . . . . . . . . . 630,370 . . . . . . . . . . . 7.00% . . . . . . . . 1,004 

3 Atlanta . . . . . . . . . . . . . . 552,330 . . . . . . . . . . . 6.13% . . . . . . . . . . 407 

4 Baltimore . . . . . . . . . . . . 483,860 . . . . . . . . . . . 5.37% . . . . . . . . . . 844 

5 Philadelphia . . . . . . . . . . 468,650 . . . . . . . . . . . 5.20% . . . . . . . . . . 921 

6 Boston . . . . . . . . . . . . . . 450,840 . . . . . . . . . . . 5.00% . . . . . . . . 1,186 

7 Detroit . . . . . . . . . . . . . . 431,400 . . . . . . . . . . . 4.79% . . . . . . . . . . 992 

8 Fort Lauderdale . . . . . . . 371,410 . . . . . . . . . . . 4.12% . . . . . . . . . . 197 

9 Washington D.C. . . . . . . 362,460 . . . . . . . . . . . 4.02% . . . . . . . . . . 814 

10 Hartford . . . . . . . . . . . . 303,620 . . . . . . . . . . . 3.37% . . . . . . . . 1,102 

11 Providence . . . . . . . . . . 295,740 . . . . . . . . . . . 3.28% . . . . . . . . 1,137 

12 Dallas/Fort Worth . . . . . 294,450 . . . . . . . . . . . 3.27% . . . . . . . . . . 927 

13 Los Angeles . . . . . . . . . . 267,660 . . . . . . . . . . . 2.97% . . . . . . . . 2,153 

14 Las Vegas . . . . . . . . . . . 266,530 . . . . . . . . . . . 2.96% . . . . . . . . 1,880 

15 Denver . . . . . . . . . . . . . 253,220 . . . . . . . . . . . 2.81% . . . . . . . . 1,504 

16 Minneapolis . . . . . . . . . . 237,170 . . . . . . . . . . . 2.63% . . . . . . . . 1,308 

17 Manchester . . . . . . . . . . 221,710 . . . . . . . . . . . 2.46% . . . . . . . . 1,205 

18 Pittsburgh . . . . . . . . . . . 209,120 . . . . . . . . . . . 2.32% . . . . . . . . . . 921 

19 Columbus . . . . . . . . . . . 206,230 . . . . . . . . . . . 2.29% . . . . . . . . . . 830 

20 Buffalo . . . . . . . . . . . . . . 205,810 . . . . . . . . . . . 2.28% . . . . . . . . 1,055 

21 St. Louis . . . . . . . . . . . . . 200,000 . . . . . . . . . . . 2.22% . . . . . . . . . . 870 

22 New Orleans . . . . . . . . . 198,690 . . . . . . . . . . . 2.21% . . . . . . . . . . 487 

23 Nashville . . . . . . . . . . . . 192,120 . . . . . . . . . . . 2.13% . . . . . . . . . . 613 

24 Raleigh/Durham . . . . . . 191,600 . . . . . . . . . . . 2.13% . . . . . . . . . . 588 

25 Houston . . . . . . . . . . . . 189,990 . . . . . . . . . . . 2.11% . . . . . . . . . . 780 

Market Share 

9,009,160 100.00% 

Source: United States Department of Transportation, Origin & Destination, T-100 Data 

Percentage based on enplaned passengers – September 2004 

20.9 

Southwest Airlines 

20.5 

Delta Air Lines 

11.0 

US 

Airways 

9.8 

American 

Airlines 

6.5 6.4 6.1 5.2 

4.5 9.1 

12 13 

Continental 

Airlines 

United 

Airlines 

Northwest 

Airlines 

AirTran 

Airways 

JetBlue 

Airways 

Other

Financials Independent 

Auditors’ Report 

The Board of Directors 

Hillsborough County Aviation Authority 

Tampa, Florida 

We have audited the accompanying statements of net assets of the Hillsborough County Aviation 

Authority (the “Authority”), as of September 30, 2004 and 2003, and the related statements of revenues, 

expenses, and changes in net assets, and of cash flows for the years then ended. These financial statements 

are the responsibility of the Authority’s management. Our responsibility is to express an opinion on these 

financial statements based on our audits. 

We conducted our audits in accordance with auditing standards generally accepted in the United States of 

America and the standards applicable to financial audits contained in Government Auditing Standards 

issued by the Comptroller General of the United States. Those standards require that we plan and perform 

the audit to obtain reasonable assurance about whether the financial statements are free of material 

misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and 

disclosures in the financial statements. An audit also includes assessing the accounting principles used 

and significant estimates made by management, as well as evaluating the overall financial statement 

presentation. We believe that our audits provide a reasonable basis for our opinion. 

In our opinion, such financial statements present fairly, in all material respects, the financial position of 

the Authority at September 30, 2004 and 2003, and the changes in its financial position and its cash flows 

for the years then ended in conformity with accounting principles generally accepted in the United States 

of America. 

Management’s Discussion and Analysis is not a required part of the basic financial statements, but is 

supplementary information required by the Governmental Accounting Standards Board. This 

supplementary information is the responsibility of the Authority’s management. We have applied certain 

limited procedures, which consisted principally of inquiries of management regarding the methods of 

measurement and presentation of the supplementary information. However, we did not audit the 

information and we do not express an opinion on it. 

December 9, 2004 

15

Management’s Discussion And Analysis 

The following management’s discussion and analysis (MD&A) of the financial performance and activity of the Hillsborough County Aviation 

Authority (the Authority) is to provide an introduction and understanding of the financial statements of the Authority for the years ended 

September 30, 2004 and 2003 with selected comparisons to prior years. The information presented should be read in conjunction with 

the financial statements, notes and supplemental schedules found in this report. 

Introduction 

The Authority was created in 1945 and is an independent special district governed by the Hillsborough County Aviation Authority Act, 

Chapter 2003-370, Laws of Florida (the Act). The Act provides that the Authority will have exclusive jurisdiction, control, supervision and 

management over all publicly owned airports in Hillsborough County. There are five Authority Members, three residents of Hillsborough 

County appointed to the Authority by the Governor of the State of Florida for four year terms; the Mayor of the City of Tampa, ex-officio; 

and a Commissioner of and selected by the Board of County Commissioners of Hillsborough County, ex-officio. 

The Authority owns and operates Tampa International Airport (the Airport) and three general aviation airports. The Airport occupies 

approximately 3,400 acres and is primarily an origination-destination (O&D) airport serving the greater Tampa Bay area. Peter O. Knight 

Airport, a 139-acre facility, is located six miles southeast of the Airport; Plant City Airport, a 199-acre facility, is located 22 miles east of the 

Airport; and Vandenberg Airport, a 407-acre facility, is located 12 miles east of the Airport. 

The Authority is a self-supporting organization and generates revenues from airport users to fund operating expenses and debt service 

requirements. Capital projects are funded through the use of bonds, short-term financing, passenger facility charges, federal and state 

grants and internally generated funds. Although empowered to levy ad-valorem property taxes, the Authority has not collected any tax 

funds since the early 1970s. 

Airport Activity Highlights 

For the fiscal year ended September 30, 2004, passenger enplanements totaled 8,465,720, compared to 7,660,785 for FY2003 and 

7,618,598 for FY2002, increases of 10.5% and 11.1%, respectively. Nationally, airline passenger traffic for FY2004 increased 4% over FY2003. 

The number of FY2004 passengers for the Airport is a record, exceeding the previous record set in FY2001 by 281,905 passengers, an 

increase of 3.4%. Nationwide, passengers for FY2004 compared to FY2001 declined by 7.7%, indicating the Airport’s recovery continues 

to exceed the industry average. Landed weight in FY2004 totaled 11,181,590 thousand pounds, compared to 10,812,057 thousand 

pounds in FY2003 and 11,144,792 thousand pounds in FY2002, increases of 3.4% and .3%, respectively. The number of landings for 

domestic and international flights increased 2.8% in FY2004 over the prior fiscal year. While airlines overall continue to struggle with 

higher operating costs and the recent economic downturn, these increases in activities at Tampa International Airport are a positive sign 

of the strength of this market area and the cost-competitive environment of the Airport. 

16 

Highlights of the Fiscal Year 2004 Budget 

As required by the Authority’s trust agreement, airline agreement and state statutes, the Authority is required to adopt an annual budget. 

On September 2, 2003 the Authority Board approved the Fiscal Year 2004 Operating and Capital Budget. The FY2004 Budget continues 

the goal of returning to normal levels of customer service while maintaining the objectives of controlling expenses, maximizing non-airline 

revenues and limiting cost increases to those airlines serving Tampa International Airport. In the FY2004 Operating Budget, revenues were 

projected at $138,981,200. The revenue estimates for the FY2004 budget were based on projections of passenger activity returning to 

the levels of pre-9/11/2001. The FY2004 Operating Budget expenses were projected at $66,107,000, and included funding for additional 

security measures and expenses associated with the operation of the new outbound baggage system for most of the year. Discussion of 

the FY2004 Capital Budget is presented in the “Capital Improvement Program” section of this MD&A. 

Summaries of the operating budget and actual results for FY2004 are shown below. This table is based on and presented in accordance with 

the airline-airport agreement (see “Airline Rates and Charges” section in this MD&A and Note 3 in the accompanying financial statements). 

Percent 

Fiscal Year 2004 Budget Actual of Budget 

___________________ ___________________ ___________________ 

Revenues $138,981,200 $143,054,412 102.9% 

Expenses (66,107,000) 

___________________ 

(64,502,950) 

___________________ 

97.6% 

___________________ 

Funds Available for Debt Service 72,874,200 78,551,462 107.8% 

Debt Service from Current Operations (40,756,698) (40,752,668) 100.0% 

Distribution of Airline Revenue Sharing (6,139,100) 

___________________ 

(6,906,692) 

___________________ 

112.5% 

___________________ 

Net Increase for Capital 

Improvement Program and Reserves $ 25,978,402 

___________________ 

$ 30,892,102 

___________________ 

118.9% 

___________________ 

Airline Rates and Charges 

Effective October 1, 1999, the Authority entered into a new airline-airport use and lease agreement (Airline-Airport Agreement) with the 

signatory airlines, which has a seven-year term and incorporates the lease and use of the terminal complex and the airfield at the Airport. 

The agreement establishes a “compensatory” rate making methodology where the signatory airlines pay fees and charges based on the 

Authority’s cost of providing facilities and services to the airlines. 

Rates and charges are calculated on an annual basis and reviewed and adjusted, if necessary, throughout each fiscal year to ensure that 

sufficient revenues are generated to satisfy all requirements of the Authority’s Trust Agreement. At the end of each fiscal year, the Authority 

will recalculate rates and charges based on audited financial data and a settlement will take place with the signatory airlines. Included in 

the Airline-Airport Agreement are rates and charges calculations with specific rebates of debt service coverage and sharing of net remaining 

revenues. This net revenue sharing component was established at 15% of net revenues, as defined, in fiscal years 2000 and 2001, 

16% for fiscal year 2002, 17% for fiscal year 2003, 18% for fiscal year 2004 and escalates 1% annually to 20% in fiscal year 2006. Nonsignatory 

rates and charges do not provide for a 25% debt service coverage reduction or the “net revenue sharing” component, thus the 

Authority charges two distinct rates to airlines operating at the airport based on the cost of providing services for facilities utilized. 

17

The table below summarizes passenger airline rents, landing fees, net revenue sharing and cost per enplaned (departing) passenger. Cost 

per enplaned passenger is a standard industry measurement, and the goal of the Authority is to maintain a competitive cost per enplanement 

at the Airport. The actual cost per enplanement for FY2004 was $4.21, compared to the original budget of $4.70. This variance is 

attributable to actual expenses for the year coming in less than budget, reimbursements from the Transportation Security Administration, 

an increase in revenue sharing over the budget and actual enplanements for FY2004 exceeding projections. For FY2004 enplanements 

were estimated at 8,184,000 while actual enplanements of 8,465,720 exceeded the budget forecast and also resulted in a record year 

for the Airport. 

Passenger Airline Costs Percent 

Fiscal Year 2004 Budget Actual of Budget 

___________________ ___________________ ___________________ 

Airline Landing Fees $10,387,500 $ 9,624,061 92.7% 

Landside Terminal Rentals 17,199,100 16,880,967 98.2% 

Airside Building Rentals 17,024,400 

___________________ 

16,032,600 

___________________ 

94.2% 

___________________ 

Total Airline Fees and Charges 44,611,000 42,537,628 95.4% 

Less Airline Revenue Sharing (6,139,100) 

___________________ 

(6,906,692) 

___________________ 

112.5% 

___________________ 

Net Airline Fees and Charges $38,471,900 $35,630,936 92.6% 

___________________ ___________________ ___________________ 

___________________ ___________________ ___________________ 

Enplaned Passengers 8,184,000 8,465,720 103.4% 

___________________ ___________________ ___________________ 

Airline Cost Per Passenger $ 4.70 $ 4.21 89.5% 

___________________ ___________________ ___________________ 

___________________ ___________________ ___________________ 

Overview of the Financial Statements 

The Authority operates as a single enterprise fund with multiple costs centers. The financial statements are prepared on the accrual basis 

of accounting, therefore revenues are recognized when earned and expenses are recognized when incurred. Capital assets are capitalized 

and depreciated, except land, over their useful life. Reference should be made to Note 2 in the accompanying financial statements for a 

summary of the Authority’s significant accounting policies. Following this MD&A are the basic financial statements and supplemental schedules 

of the Authority. These statements and schedules, along with the MD&A, are designed to provide readers with an understanding of the 

Authority’s finances. 

The statements of net assets present information on all of the Authority’s assets and liabilities for the fiscal years ended September 30, 2004 

and 2003, with the difference between these reported as net assets. The statements of revenues, expenses and changes in net assets 

present financial information showing how the Authority’s net assets changed during the two fiscal years. These statements summarize 

the recording of financial transactions when the underlying events occur, not the receipt or disbursement of cash. The statements of cash 

flows relate to the cash and cash equivalents in-flows and out-flows as a result of financial transactions during the two fiscal years and 

also includes a reconciliation of operating income to the net cash provided by operating activities. 

18 

Financial Highlights 

Operating Revenues 

Percent Percent 

Change Change 

Fiscal Year Fiscal Year Fiscal Year 2003 to 2002 to 

Revenue Classification 2004 2003 2002 2004 2003 

___________________ ___________________ ___________________ ______________ ______________ 

Airfield $ 9,957,737 $ 9,057,481 $ 9,319,033 9.9% (2.8)% 

Terminal Building 30,499,660 26,655,750 22,230,673 14.4% 19.9% 

Airside Buildings 16,009,562 16,681,825 13,880,083 (4.0)% 20.2% 

Commercial Landside 71,068,176 64,791,477 63,487,870 9.7% 2.1% 

Cargo 1,935,081 1,681,681 1,084,928 15.1% 55.0% 

Auxiliary Airports 594,772 563,695 480,871 5.5% 17.2% 

General Aviation 841,999 778,138 772,351 8.2% 0.7% 

Other 6,478,135 6,148,443 5,620,221 5.4% 9.4% 

___________________ ___________________ ___________________ ______________ ______________ 

$137,385,122 $126,358,490 $116,876,030 8.7% 8.1% 

___________________ ___________________ ___________________ ______________ ______________ 

___________________ ___________________ ___________________ ______________ ______________ 

The table above presents the major operating revenue classifications for FY2004, FY2003 and FY2002. Airfield revenues are comprised of 

landing fees received from the airlines based on landed weight. In accordance with the airline agreement, landing fee rates are calculated 

by dividing 90% of total expenditures in the airfield cost center by the annual total landed weight of all commercial airlines. The increase 

in airfield revenues in the current year is attributable to the impact of applying operating grants in FY2003 to offset airfield expenses. The 

decrease in airfield revenues from FY2002 to FY2003 also relates to the impact of the operating grant in FY2003. 

Space rental fees to the airlines in the terminal building are based on the cost of providing the space to the airlines. The variance in terminal 

building revenues for FY2004 compared to FY2003 is due to increases in space rental revenues (due to increases in expenses, i.e., full 

year of baggage handling system) and food and beverage and hotel concession revenues. FY2004 concession revenues were all positively 

impacted by the increase in the passenger activity at the Airport. In FY2003 a partial year of operating a portion of the baggage 

handling system and increases in insurance costs contributed to the increase in revenues in this classification. The opening of the new 

Airside E in October 2002 contributed to increased concession revenues in FY2003 as did the elimination of the concession improvement 

trust. Payments to the trust of approximately $789,000 were recognized as revenues in FY2003 and future facility improvements will be 

paid directly by the concessionaires. 

The decrease in airside revenues in FY2004 over the prior year is a result of the reimbursement of airside security costs from the Transportation 

Security Administration (TSA) and a decrease in the amount of investment service allocated to this cost center. The increase in airside revenues 

for FY2003 compared to FY2002 is due to the opening of Airside E (108,303 square feet larger than Airside C) and the closure of 

Airside C that resulted in additional space rental revenues of $2,712,200. 

The commercial landside classification consists primarily of car rental, parking and other concession revenues; all of these items were 

positively impacted by the increase in passenger enplanements in FY2004. Parking revenues increased $3.2 million in FY2004, indicating 

a continued increase in the use by those traveling as well as Airport patrons picking up passengers. Car rental concessions in FY2004 

increased $3.2 million over the prior year as a result of increased activity and a settlement of a revenue audit that resulted in additional 

revenues of $1,582,500. Although passenger enplanements for FY2003 were only slightly above the prior year, parking revenues 

increased $1.6 million over FY2002, indicating an increase in the use of the parking facility by travelers. 

19

Cargo revenue increases in FY2004 are due to higher occupancy in the cargo facilities. On March 1, 2003, the newly constructed Federal 

Express cargo sorting facility was opened, generating $597,400 additional revenues in the cargo complex in FY2003. Revenues generated 

from the general aviation operations in FY2004 showed positive variances from the prior year and are higher than the FY2004 budget by 

2.1%. Other revenues in FY2004 increased over FY2003 due to additional rentals in the non-aviation areas of the Airport. In FY2003, this 

classification increased $528,200 over FY2002, due to additional rentals in the non-aviation area of the airport and a full year of revenues 

from the fuel farm. In mid-FY2002, improvements to the fuel farm were made by the Authority and the fees charged to the airlines were 

increased for the use of the facility. 

Operating Grants and Reimbursements 

From October 2002 through May 2003, the Authority recorded $664,400 in reimbursements from the Transportation Security Administration 

for providing law enforcement services on behalf of the TSA at the passenger security checkpoints. As of June 1, 2003, the agreement with 

the TSA was terminated. In FY2004 the TSA reinstated the agreement and the Authority was reimbursed $1,241,772 (retro-active to June 

2003 through September 2004) for providing the law enforcement services. The Authority has this agreement with the TSA for the next 

fiscal year and anticipates the TSA will continue with the reimbursement program. An annual grant in the amount of $120,500 from the 

TSA was received in each of the fiscal years presented to partially fund the three canine programs at the Airport. In FY2004 $67,900 was 

received from the State of Florida for reimbursement of overtime expenses associated with security issues. In FY2003, the Authority 

received a $3,000,000 operating grant from the State of Florida under a program to provide economic assistance to public-use airports 

due to the economic impacts from the events of September 11, 2001. 

Operating Expenses 

Percent Percent 

Change Change 

Fiscal Year Fiscal Year Fiscal Year 2003 to 2002 to 

Expense Classification 2004 2003 2002 2004 2003 

___________________ ___________________ ___________________ ______________ ______________ 

Airfield $ 6,668,188 $ 7,118,577 $ 6,542,633 (6.3)% 8.8% 

Terminal Building 18,684,354 16,023,919 13,385,142 16.6% 19.7% 

Airside Buildings 14,558,486 14,228,730 12,301,327 2.3% 15.7% 

Commercial Landside 14,126,355 13,246,519 12,173,071 6.6% 8.8% 

Cargo 402,438 445,159 396,395 (9.6)% 12.3% 

Auxiliary Airports 941,534 947,856 867,496 (0.7)% 9.3% 

General Aviation 438,260 413,634 473,086 0.6% (12.6)% 

Passenger Transfer System 2,776,560 2,710,074 2,255,462 2.5% 20.2% 

Roads and Grounds 5,378,920 5,442,293 4,279,061 (1.2)% 27.2% 

Other 1,688,938 1,461,778 1,270,687 15.5% 15.0% 

___________________ ___________________ ___________________ ______________ ______________ 

$65,664,033 $62,038,539 $53,944,360 5.8% 15.0% 

___________________ ___________________ ___________________ ______________ ______________ 

___________________ ___________________ ___________________ ______________ ______________ 

The table above presents the major expense classifications for FY2004, FY2003 and FY2002. Total operating expenses for FY2004 increased 

$3,625,500 (5.8%) over the prior fiscal year. The total actual expenses of $65,664,000 were within the budgeted amounts for the year 

(see “Highlights of the Fiscal Year 2004 Budget”). Total operating expenses for FY2003 increased $8,094,200 (15.0%) over the prior fiscal 

year. While this overall percentage increase compared to FY2002 is significant, it is important to note the FY2003 actual expenses were 

also within budgeted amounts and to also discuss the FY2002 results which were impacted by the cost containment program implemented 

after September 11, 2001 (see ”FY2003 Discussion of Operating Expenses”). 

20 

FY2004 Discussion of Operating Expenses 

The airfield cost center expenses declined in FY2004 over FY2003 as a result of the decrease in insurance expense for the Airport as well 

as less personnel costs being charged to this cost center. The increase in expenses in the terminal building cost center relate to the completion 

of the final phases of the outbound baggage handling system and security enhancement project. The Authority incurred approximately 

$1.35 million in additional operating expenses over the prior fiscal year to fully operate the new system. The system required the addition 

of 16 new personnel in FY2004 and a significant increase in power consumption. Overall, the new system, of which several phases came 

on-line in FY2003, requires 39 personnel at a cost of $2.4 million and approximately $1 million in electricity to operate annually. This project 

is discussed in more detail in the “Capital Improvement Program” section of this MD&A. Other increases in operating expenses in the Terminal, 

Airside and Commercial Landside cost centers during FY2004 reflect the continuation of the Authority to return to a normal level of customer 

service expected by the community and traveling public. Personnel expenses increased over the prior year due to the funding of additional 

positions, the cost of living adjustment in January 2004 and related benefit expenses. Increases in contractual maintenance, which include 

janitorial services, shuttle, elevator and escalator maintenance were $884,800 over the prior year. Due to a rate increase, the Authority 

incurred approximately $380,000 in additional electricity expenses for the year. Decreases in expenses occurred with the actual property 

and liability insurance for FY2004 coming in $820,100 less than FY2003, and the elimination of inspection requirements at the short term 

parking garage entrance, which resulted in a decrease of $286,000. 

Other noted decreases in expenses occurred with the elimination of contractual law enforcement services provided by Hillsborough 

County, saving $412,200, the elimination of an outside towing service, saving $93,400, and reductions in the use of outside legal and 

engineering services, decreasing these expenses $163,800. These services and operational requirements are now provided by the Authority’s 

in-house personnel. It is important to note the Authority actively continues with cost containment efforts in controlling expenditures in all 

areas possible, including contracted services, contracted maintenance and other operating expenditures. This is evident by the cost per 

enplanement for the year of $4.21, compared to the budgeted amount of $4.70. 

FY2003 Discussion of Operating Expenses 

Significant changes during FY2003 resulted in considerable additional costs for the Authority. In mid-October 2002, new Airside E opened 

and Delta, United and Air Canada were relocated to this facility. Due to the requirements of the airlines, this airside was over 108,303 

square feet larger than Airside C, which was closed when the new airside commenced operations. The increased costs associated with 

operating the new Airside E and its passenger transfer system impacted FY2003 by approximately $1,195,600. The Authority incurred 

large increases in insurance costs and just the rise in property insurance premiums accounted for $1,624,400 in increased expenses. Also 

included in FY2003 were increases in operating expenditures due to additional security measures that were required by the TSA. 

After the events of September 11, 2001, the Authority adopted a FY2002 amended budget that significantly curtailed expenses. The cost 

containment measures in FY2002 reduced expenses by over $4 million over the original budget by reducing or cutting costs in all areas 

except those related to safety or security. As expected, this cost-cutting program, while certainly successful in controlling expenses, 

reduced the level of customer service and FY2003 marked the first step toward returning to a normal level of operations. 

With awareness of the foregoing, the following discusses specific variances within the operating expense area in FY2003 compared to 

FY2002. Salaries and wages increases of $2,625,900, along with associated increases in FICA and pension expenses were related to additional 

security requirements and the elimination of the hiring freeze. Overtime for FY2003 was reduced $351,700 over FY2002 with the 

implementation of twelve-hour shifts in the police and traffic departments and as new permanent positions fulfilled certain requirements 

that mandated the use of overtime in the prior fiscal year. Group health and workers’ compensation insurance increased $919,700 over 

the prior year as a result of increases in personnel and the rise in premiums. Janitorial costs, at $5,523,600 for FY2003, were $642,100 (a 

significant portion of this increase related to worker compensation insurance increases) over FY2002. Electricity expenses were $964,600 

over FY2002 with the additional energy requirements of Airside E, resumption of normal operating schedules for elevators, escalators and 

shuttle cars and the return of the terminal building to normal temperatures. As experienced in the past fiscal year, insurance costs continued 

to rise for the Authority, with FY2003 increasing $1,624,400 over the prior year. Even with the increases in expenses in FY2003, the 

Authority remained committed to providing quality services while maintaining a competitive cost structure for the airlines serving the airport. 

21

Summary of Changes in Net Assets 

The following is a summary of the statements of revenues, expenses and changes in net assets: 

Fiscal Year Fiscal Year Fiscal Year Change 2003 Change 2002 

2004 2003 2002 to 2004 to 2003 

___________________ ___________________ ___________________ ___________________ ___________________ 

Operating Revenues 

Operating Grants and 

$137,385,122 $126,358,490 $116,876,030 $ 11,026,632 $ 9,482,460 

Reimbursements 1,430,182 3,787,348 1,989,150 (2,357,166) 1,798,198 

Operating Expenses 

Distribution of Airline 

65,664,033 62,038,539 53,944,315 3,625,494 8,094,224 

Revenue Sharing 6,906,692 

___________________ 

5,254,849 

___________________ 

5,388,897 

___________________ 

1,651,843 

___________________ 

(134,048) 

___________________ 

Operating Income before 

Depreciation and 

Amortization 

Depreciation and 

66,244,579 62,852,450 59,531,968 3,392,129 3,320,482 

Amortization 59,996,075 

___________________ 

41,617,751 

___________________ 

45,974,034 

___________________ 

18,378,324 

___________________ 

(4,356,283) 

___________________ 

Income from Operations 

Net Non-Operating 

6,248,504 21,234,699 13,557,934 (14,986,195) 7,676,765 

Expense 18,816,564 21,725,964 21,013,341 (2,909,400) 712,623 

Capital Contributions 54,581,033 

___________________ 

57,552,837 

___________________ 

44,536,925 

___________________ 

(2,971,804) 

___________________ 

13,015,912 

___________________ 

Increase in Net Assets $ 42,012,973 $ 57,061,572 $ 37,081,518 $(15,048,599) $19,980,054 

___________________ ___________________ ___________________ ___________________ ___________________ 

___________________ ___________________ ___________________ ___________________ ___________________ 

Operating income before depreciation and amortization at $66,244,600 for FY2004 is $3,392,100 higher than the previous year. 

Contributing to this positive variance is an increase in operating revenues of $11,026,600, offset by an increase in operating expenses of 

$3,625,500. In FY2003, operating income before depreciation and amortization was $3,320,500 over FY2002. Details of the operating 

revenues and expenses are more fully discussed in the previous section “Financial Highlights” of this MD&A. 

Depreciation and amortization expense, at $59,996,100 for the current year, was $18,378,300 higher than the FY2003 due to the 

impact of a full year of depreciation for assets that were capitalized at the end of FY2003. Another factor contributing to the additional 

depreciation relates to the completion of the new baggage handling system and the disposal of old system, which became obsolete for 

current requirements and needs. Depreciation and amortization expense of $41,617,800 in FY2003 was $4,356,300 lower than FY2002 

due to the accelerated depreciation of the Airside C building in FY2002. This airside was closed October 15, 2002, and the airlines were 

relocated to new Airside E. The Airside C Building has been demolished and reconstruction efforts are underway. 

Capital Contributions consists of Federal and State Grants and Passenger Facility Charges (PFCs), which are being received to fund various 

construction projects and the land acquisition program at the Airport. PFCs are collected at a $4.50 per passenger level by the airlines, of 

which $4.39 is remitted to the Authority. Due to the increase in enplaned passengers for FY2004, the collection of PFCs during FY2004 

increased $3,583,000 (11.5%) over the prior year. This increase was offset by a decrease in state grants received in FY2004 for the new 

outbound baggage system and federal and state grants that were received for the reconstruction of Airside C in FY2003. Capital contributions 

in FY2003 reflect a full year of receipt of PFCs at the $4.50 level (effective June 1, 2002, previously $3.00) with a total increase of 

$7,752,900 over FY2002. The balance of the variance for FY2003 is primarily due to the grants received for the new outbound baggage 

system and for the reconstruction of Airside C mentioned above. 

22 

Summary of Statements of Net Assets 

A summarized comparison of the Authority’s total assets, total liabilities and net assets at September 30, 2004, 2003 and 2002 is as follows: 

Change 2003 Change 2002 

2004 2003 2002 to 2004 to 2003 

___________________ ___________________ ___________________ ___________________ ___________________ 

Assets 

Current assets 

Current unrestricted 

assets 

Current restricted 

$ 25,907,831 $ 18,386,421 $ 52,326,592 $ 7,521,410 $ (33,940,171) 

assets 

Non-current assets 

165,188,124 256,249,616 104,637,671 (91,061,492) 151,611,945 

Capital assets, net 

Other non-current 

1,001,570,672 893,572,412 776,712,459 107,998,260 116,859,953 

assets 7,578,211 

___________________ 

8,928,863 

___________________ 

5,476,224 

___________________ 

(1,350,652) 

___________________ 

3,452,639 

___________________ 

Total Assets $1,200,244,838 $1,177,137,312 $939,152,946 $ 23,107,526 $237,984,366 

___________________ ___________________ ___________________ ___________________ ___________________ 

___________________ ___________________ ___________________ ___________________ ___________________ 

Liabilities 

Current liabilities $ 64,722,642 $ 61,663,664 $ 63,592,428 $ 3,058,978 $ (1,928,764) 

Non-current liabilities 672,431,045 

___________________ 

694,395,470 

___________________ 

511,543,912 

___________________ 

(21,964,425) 

___________________ 

182,851,558 

___________________ 

Total Liabilities 737,153,687 756,059,134 575,136,340 (18,905,447) 180,922,794 

___________________ ___________________ ___________________ ___________________ ___________________ 

Net Assets 

Invested in capital 

assets, net of debt 369,044,731 339,523,551 306,240,304 29,521,180 33,283,247 

Restricted 70,632,151 63,633,500 16,686,541 6,998,651 46,946,959 

Unrestricted 23,414,269 

___________________ 

17,921,127 

___________________ 

41,089,761 

___________________ 

5,493,142 

___________________ 

(23,168,634) 

___________________ 

Total Net Assets $ 463,091,151 $ 421,078,178 $364,016,606 $ 42,012,973 $ 57,061,572 

___________________ ___________________ ___________________ ___________________ ___________________ 

___________________ ___________________ ___________________ ___________________ ___________________ 

Current restricted assets decreased $91,061,500 in FY2004, primarily as a result of the use of construction bond funds in FY2004 for the 

capital improvement program; the bonds were issued in FY2003. In FY2003, current assets increased $117,671,800 over FY2002, due to 

the bond funding received for the capital improvement program, offset by expenditures of construction funds in FY2003. Net capital assets 

increased $107,998,300 in FY2004 over FY2003 and $116,860,000 in FY2003 over FY2002. Both years’ variances reflect the completion 

of major projects and the commencement of new capital spending under the capital improvement program. 

Current liabilities, with a balance of $64,722,600 at September 30, 2004, were $3,059,000 higher than the balance at September 30, 

2003. The balance at September 30, 2003 of $61,633,664 was $1,928,000 less than the balance at September 30, 2002. The variances 

for each year are primarily due to the changes in the construction accounts payable. Non-current liabilities decreased $21,964,400 in 

FY2004 over FY2003, primarily due to the principal payment of $19,395,000 on the revenue bonds and a $5,000,000 principal payment 

on the outstanding commercial paper program. Non-current liabilities in FY2003 increased $182,851,600 over FY2002, due to the issuance 

of new bond financing for the on-going capital program and refinancing of a portion of the commercial paper program, offset by a 

reduction of $18,440,000 of revenue bonds payable due to bond maturities. 

23

Total net assets in FY2004 increased $42,013,000 over FY2003 reflecting grant and PFC contributions for capital projects totaling 

$54,581,0300, offset by a higher depreciation in the current year. In FY2003, total net assets increased $57,061,600 over the prior year 

reflecting capital contributions for capital projects totaling $57,552,800, offset by a net loss of $491,200 in FY2003. 

The FY2003 bond financing and the associated impact upon the capital program is discussed in more detail in subsequent sections of this 

MD&A (see “Capital Improvement Program”, “Capital Planning and Financing” and “Debt Management”). 

Capital Improvement Program 

The Authority’s approved FY2004 Capital Budget, in the total amount of $72,010,000, continues an aggressive program to develop the 

necessary facilities and improvements to meet the demands of the aviation system for the Airport’s market area. Current year capital spending 

includes projects approved in prior years that are still under construction. During FY2004, the Authority expended $152,533,923 in its 

on-going capital improvement program. 

In early FY2003, Delta Airlines relocated from Airside C where they had operated for over 30 years, to a new Airside E facility with additional 

gates and operational space. The FY2003 Capital Budget included funds for the demolition and replacement of the Airside C building 

with a 12-gate facility ($119,731,800) to meet the growing needs of Southwest Airlines. The FY2004 Capital Budget added funding of 

$15,072,200 to the Airside C project to increase the capacity of the planned facility to a 16-gate structure. The Authority will relocate airline 

tenants at Airside D to the space that will be vacated by Southwest Airlines at Airside A and to the additional gates in Airside C. Airside 

D, a 34-year-old structure, is the last of the original airsides at the Airport and will be closed upon the opening of new Airside C. The 

reconstruction of Airside C is scheduled for completion in the spring of 2005. Sources of funding for this project include grants, PFCs and 

revenue bonds. 

The outbound baggage system, a project originally approved in FY2003 at a cost of $107,235,000 was allocated additional funding of 

$19,587,900 in the FY2004 Capital Budget. The outbound baggage system integrates in-line screening and eliminates the need for the 

passenger to transfer baggage from the airline ticket counter to the TSA screening point after checking in. The screening units on the 

ticket level were removed, increasing queuing and circulation space within the ticket level of the terminal. The new system, fully operational 

in FY2004, also converts the former manual load and transportation of baggage to a fully automated high-speed network with 

approximately four miles of conveyors, providing baggage tracking and sorting features. The Airside C related portion of this system will 

be brought on-line with the opening of the new airside. Major funding for the outbound baggage system is provided from state grants, 

PFCs and PFC backed revenue bonds. In addition, the Authority has requested a Letter of Intent from the TSA to assist in offsetting a portion 

of the costs of the new system. 

PFC Application #6, authorizing PFC collections in the amount of $298,115,400 was approved by the Federal Aviation Administration 

during FY2003, bringing the total collection authority for all PFC applications to $593,121,200. Through September 30, 2004, $233,648,700 

revenue has been collected under these approved applications. Expenditures under the PFC applications through September 30, 2004 

total $440,029,000. Expenditures in excess of collections are funded from the issuance of PFC backed revenue bonds, commercial paper, 

or from Authority funds that will be reimbursed from PFCs. 

Capital Planning and Financing 

Typically, airports in the United States develop master plans that define the airports’ ultimate configuration at full development during 

20-year time spans, thereby establishing airport complex requirements. An update to the Authority’s last Master Plan is currently underway, 

with completion scheduled for late 2005. Master plans do not normally provide detailed information to determine funding strategies. The 

Authority periodically prepares (or updates) a Strategic Business Plan to provide a 10-year detailed funding analysis of operating expenses, 

revenues, and projected airline charges and establish development and financial goals along with measurement criteria. The plan’s overriding 

objective is to place the Authority in a healthy financial position without overburdening the air carriers, while maintaining competitive 

airline rates and charges. Funding strategies and recommendations will ensure airport facilities and improvements are brought on line 

when needed, based on established trigger points, are funded in a manner that preserves the Authority’s competitive cost structure, and 

maintains maximum flexibility under changing circumstances. 

The economic downturn and other events have resulted in negative impacts on the airline industry and forced major airlines to place 

significant emphasis on cost reductions and revenue improvement. Several air carriers have entered Chapter 11 bankruptcy proceedings, 

while others continue to search for ways to improve their operations. These events required the Authority to re-evaluate the last adopted 

business plan, update forecasts and determine the timing and scope of the Authority’s capital development program. The plan was updated 

and presented to the Authority’s Board at a workshop on January 23, 2003 and was subsequently adopted by the Board on February 5, 

24 

2003. The 2003 Strategic Business Plan, as approved, demonstrates the Authority’s ability to meet established goals while expanding 

Airport facilities to meet forecasted demand, sustain the Airport’s cost competitive rate structure and provide financial capacity for future 

development. An update to the Strategic Business Plan will be done in association with the Master Plan update. 

Debt Management 

At the end of the current fiscal year, the Authority had general airport revenue bonds outstanding in the total amount of $613,110,000. 

Of this total, $20,165,000 is current and will mature on October 1, 2005. All of the Authority’s long-term bonds were issued as insured debt. 

During FY2004, the Authority did not issue any new debt, although it is anticipated that in FY2005 an issuance of approximately 

$98,000,000 in revenue bonds will take place to provide funding for the car rental garages and counter relocation, and the economy 

public parking garage. These two projects were approved as part of the FY2005 Capital Budget. 

On February 19, 2003, the Authority issued the Tampa International Airport Revenue Bonds 2003 Series A and B, in the amounts of 

$195,290,000 and $43,735,000, respectively, to finance portions of the FY2003 capital program. The proceeds, along with other funds 

(federal grants, state grants, PFCs and Authority funds) were used to pay project costs, including the Airside C development program, the 

exterior dynamic sign package, the outbound baggage system and security enhancements, the service building expansion and the refunding 

of $50,000,000 of commercial paper notes. PFC collections will be used to pay principal and interest on the 2003 Series A bonds. In connection 

with these bond issues and prior to the sale of the bonds (during the month of January 2003), the Authority made presentations 

to and subsequently received ratings upgrades from each of the three rating agencies. Receiving upgrades from all three agencies at the 

same time is rare, and at the time, the Authority was one of only three airports to receive an upgrade since the events of September 11, 

2001. Specifically the rating actions were: Moody’s: A2 to A1, Standard & Poor’s: A to A+ and Fitch: A to A+. The all-inclusive interest average 

rate was 4.73% for the 2003 Series A and B revenue bonds. As part of the anticipated issuance of debt in FY2005, the Authority will again 

work with and make presentations to all rating agencies to ensure the Authority is rated at the highest level appropriate. 

In FY2003, with historically low interest rates, the Authority proceeded with the refunding of two existing bond issues. On July 8, 2003, 

the Authority issued $151,405,000 of Tampa International Airport Revenue Refunding Bonds, 2003 Series C and D. The Series C Bonds 

were issued to current refund the 1993 Series B refunded bonds maturing after October 1, 2003. This refunding resulted in a decrease in 

debt service over 17 years of $15,864,000 with a calculated net present value savings of $10,828,900. The Series D Bonds were issued 

to current refund the 1993 Series D bonds maturing after October 1, 2003. The refunding resulted in a decrease in debt service over 21 

years of $5,349,700 with a calculated net present value savings of $3,467,200. The all-inclusive interest cost (includes interest and all 

costs) for the 2003C Series bonds was 3.81% and for the 2003D series bonds was 4.53%. While all Authority issued bonds are exempt 

from income tax, the higher interest cost for the 2003D bonds is attributable to these bonds being subject to the Alternative Minimum Tax 

(AMT). The combined all-inclusive interest cost for these new issues was 4.07%. These interest costs were the lowest ever experienced by 

the Authority. 

On September 21, 2001, the Authority entered into a Reimbursement Agreement with Landesbank Baden-Württemberg, acting through 

its New York Branch (the “Bank”). Under this agreement, the Authority is allowed to issue an aggregate principal amount of not-to-exceed 

$105,000,000 outstanding at any one time of commercial paper notes. On February 19, 2003, the Authority refunded $50,000,000 of 

the outstanding Commercial Paper Notes with proceeds from the 2003 Series A Tampa International Airport Revenue Bonds. On March 

10, 2003, the Authority issued additional Series B Commercial Paper Notes in the amount of $14,276,000 to fund the repayment of a 

note with the State of Florida. During FY2004, the Authority made a principal payment of $5,000,000 on the outstanding balance. The 

current balance of the commercial paper notes at September 30, 2004 was $64,276,000. Proceeds from the initial issuance of the notes 

were used for authorized projects in the capital improvement program. It is the Authority’s intent to utilize PFC collections to repay both 

interest and principal on $64,276,000 of the current outstanding amounts. 

The Authority’s bond covenants require that revenues available to pay debt service, as defined in the Trust Agreement, exceed 1.25% of 

the annual debt service amount. The debt service coverage ratio for FY2004 and FY2003 was 1.77 and 1.62, respectively. 

Request for Information 

This financial report is designed to provide a general overview of the Authority’s finances and to demonstrate the Authority’s accountability 

for the funds it receives and expends. Questions concerning this report or requests for additional information should be addressed to Ann 

Davis, Senior Director of Finance, Hillsborough County Aviation Authority, P.O. Box 22287, Tampa, FL 33622. Information of interest may 

also be obtained on Authority’s website at TampaAirport.com. 

25

STATEMENTS OF NET ASSETS 

SEPTEMBER 30, 2004 AND 2003 

26 


Aviation Authority 

ASSETS 2004 2003 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

CURRENT UNRESTRICTED: 

Cash and cash equivalents $ 29,701,556 $ 25,745,773 

Due to restricted funds 

Investment in direct financing lease–current 

(3,997,507) (7,735,757) 

and other current assets 203,782 

___________________ 

376,405 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total current unrestricted assets 25,907,831 18,386,421 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

CURRENT RESTRICTED: 

Cash and cash equivalents 70,655,426 100,272,775 

Due from unrestricted funds 3,997,507 7,735,757 

Investments 76,613,820 129,551,236 

Accounts receivable–net 2,004,332 2,671,118 

Passenger facility charges contributions receivable 4,809,155 3,628,689 

Government grants receivable 5,236,333 10,621,039 

Accrued interest receivable 1,378,969 1,286,250 

Supplies inventory and other current assets 492,582 

___________________ 

482,752 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total current restricted assets 165,188,124 256,249,616 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total current assets 191,095,955 274,636,037 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

CAPITAL ASSETS: 

Land 135,828,604 125,676,159 

Construction in progress 121,225,802 120,128,533 

Building, equipment, and improvements 1,196,166,379 

___________________ 

1,052,501,935 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

1,453,220,785 1,298,306,627 

Less accumulated depreciation (451,650,113) (404,734,215) 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total capital assets–net 1,001,570,672 893,572,412 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

DEBT ISSUE COSTS (net of accumulated amortization 

of $2,986,958 and $2,020,079, respectively) 7,369,498 8,502,101 

NOTES AND OTHER RECEIVABLES 208,713 222,961 

INVESTMENT IN DIRECT FINANCING LEASE – 

___________________ 

203,801 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

TOTAL ASSETS $1,200,244,838 $1,177,137,312 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

(Continued) 



STATEMENTS OF NET ASSETS 


LIABILITIES AND EQUITY 2004 2003 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

PAYABLE FROM UNRESTRICTED ASSETS: 

Accounts payable–construction $ 2,493,562 

___________________ 

$ 669,096 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

CURRENT LIABILITIES PAYABLE FROM 

RESTRICTED ASSETS: 

Accounts payable–construction 23,586,249 19,919,550 

Accounts payable–trade 2,563,387 2,145,670 

Accrued expenses 13,065,998 11,827,538 

Accrued interest payable 124,102 106,674 

Current maturities of revenue bonds payable 20,165,000 19,395,000 

Current maturities of commercial paper notes – 5,000,000 

Deferred revenue and other liabilities 2,724,344 

___________________ 

2,600,136 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total restricted liabilities 62,229,080 60,994,568 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total current liabilities 64,722,642 61,663,664 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

NONCURRENT LIABILITIES: 

Revenue bonds payable, less current maturities 

(net of deferred loss and bond premium of $14,771,617 in 2004 

and $16,498,453 in 2003, respectively) 607,716,617 629,608,459 

Commercial paper notes payable, less current maturities 64,276,000 64,276,000 

Other liabilities 438,428 

___________________ 

511,011 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total noncurrent liabilities 672,431,045 694,395,470 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total liabilities 737,153,687 756,059,134 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

COMMITMENTS AND CONTINGENCIES (Notes 10 and 11) 

NET ASSETS: 

Invested in capital assets–net of related debt 

Restricted for acquisition of property, equipment, and 

369,044,731 339,523,551 

construction projects–net of related payables and debt 32,609,286 14,975,916 

Restricted for other uses 38,022,865 48,657,584 

Unrestricted 23,414,269 

___________________ 

17,921,127 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

TOTAL NET ASSETS 463,091,151 421,078,178 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

TOTAL LIABILITIES AND NET ASSETS $1,200,244,838 $1,177,137,312 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

See accompanying Notes to Financial Statements. 

(Concluded) 

27

STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN NET ASSETS 

FOR THE YEARS ENDED SEPTEMBER 30, 2004 AND 2003 

28 

OPERATING REVENUES: 



2004 2003 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Airfield $ 9,957,737 $ 9,057,481 

Terminal building 30,499,660 26,655,750 

Airside buildings 16,009,562 16,681,825 

Commercial landside 71,068,176 64,791,477 

Cargo 1,935,081 1,681,681 

Auxiliary airports 594,772 563,695 

General aviation 841,999 778,138 

Other 6,478,135 6,148,443 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total operating revenues 137,385,122 126,358,490 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

OPERATING GRANTS AND REIMBURSEMENTS 1,430,182 3,787,348 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

OPERATING EXPENSES: 

Airfield 6,668,188 7,118,577 

Terminal building 18,684,354 16,023,919 

Airside buildings 14,558,486 14,228,730 

Commercial landside 14,126,355 13,246,519 

Cargo 402,438 445,159 

Auxiliary airports 941,534 947,856 

General avaition 438,260 413,634 

Passenger transfer system 2,776,560 2,710,074 

Roads and grounds 5,378,920 5,442,293 

Other 1,688,938 1,461,778 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total operating expenses before signatory airline 

net revenue sharing 65,664,033 62,038,539 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

SIGNATORY AIRLINE NET REVENUE SHARING 6,906,692 5,254,849 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

OPERATING INCOME BEFORE DEPRECIATION 

AND AMORTIZATION 66,244,579 62,852,450 

DEPRECIATION AND AMORTIZATION 59,996,075 

___________________ 

41,617,751 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

INCOME FROM OPERATIONS 

NONOPERATING REVENUES AND EXPENSES: 

6,248,504 21,234,699 

Interest income 3,784,447 3,413,763 

Bonds and commercial paper interest expense (22,601,011) 

___________________ 

(25,139,727) 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total nonoperating expenses–net (18,816,564) (21,725,964) 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

LOSS BEFORE CONTRIBUTIONS $(12,568,060) $ (491,265) 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

(Continued) 



STATEMENTS OF REVENUES, EXPENSES, AND CHANGES IN NET ASSETS 



___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

CONTRIBUTIONS FOR CAPITAL PROJECTS: 

Passenger facility charges $ 34,765,028 $ 31,182,018 

Federal and state grants 19,816,005 

___________________ 

26,370,819 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total contributions for capital projects 54,581,033 57,552,837 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

INCREASE IN NET ASSETS 42,012,973 57,061,572 

TOTAL NET ASSETS–Beginning of year 421,078,178 

___________________ 

364,016,606 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

TOTAL NET ASSETS–End of year $463,091,151 $421,078,178 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 


(Concluded) 

29

STATEMENTS OF CASH FLOWS 


30 




___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

CASH FLOWS FROM OPERATING ACTIVITIES: 

Operating cash receipts from customers $138,093,703 $126,894,696 

Operating grants received 1,430,182 3,787,348 

Cash payments to suppliers for goods and services (47,609,626) (44,498,368) 

Cash payments to employees for services (23,139,200) 

___________________ 

(21,695,769) 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Net cash provided by operating activities 68,775,059 64,487,907 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

CASH FLOWS FROM CAPITAL AND RELATED 

FINANCING ACTIVITIES: 

Proceeds from the issuance of revenue bonds–net of 

bond issue costs and premiums 

Proceeds from sale of revenue refunding bonds–net of 

– 248,945,827 

bond issue costs and discounts – 163,744,760 

Principal and premium paid on revenue bond refundings (164,807,229) 

Repayment of note payable to State of Florida – (14,257,667) 

Acquisition and construction of capital assets–net (152,533,927) (156,906,584) 

Principal paid on revenue bond maturities and notes (24,395,000) (68,440,000) 

Proceeds from commercial paper notes–net of issue costs – 14,257,161 

Interest paid on revenue bonds and bond anticipation notes (33,970,335) (31,626,174) 

Net proceeds from direct financing lease and other current assets 390,672 367,198 

Federal and state grants 25,200,711 21,671,508 

Passenger Facility Charges 33,584,562 

___________________ 

30,265,281 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Net cash (used in) provided by capital and related 

financing activities (151,723,317) 43,214,081 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

CASH FLOWS FROM INVESTING ACTIVITIES: 

Purchases of investment securities (76,613,820) (129,551,236) 

Proceeds from maturities of investment securities 129,551,236 41,024,495 

Interest income received on investments 4,349,276 

___________________ 

4,116,860 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Net cash provided by (used in) investing activities 57,286,692 (84,409,881) 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

NET (DECREASE) INCREASE IN CASH AND CASH EQUIVALENTS (25,661,566) 23,292,107 

CASH AND CASH EQUIVALENTS–Beginning of year 126,018,548 

___________________ 

102,726,441 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

CASH AND CASH EQUIVALENTS–End of year $100,356,982 $126,018,548 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

(Continued) 



STATEMENTS OF CASH FLOWS 



___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

RECONCILIATION OF OPERATING INCOME TO NET 

CASH PROVIDED BY OPERATING ACTIVITIES: 

Income from operations 

Adjustments to reconcile operating income to net cash 

provided by operating activities: 

$ 6,248,504 $21,234,699 

Depreciation and amortization 59,996,075 41,617,751 

Decrease in accounts receivable 666,786 56,633 

(Increase) in supplies inventory and other (9,830) (85,856) 

Increase (decrease) in accounts payable–trade 417,717 (218,746) 

Increase in accrued expenses 1,404,182 1,317,997 

Increase in deferred revenue 51,625 

___________________ 

565,429 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Net cash provided by operating activities $68,775,059 $64,487,907 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 


(Concluded) 

31

NOTES TO FINANCIAL STATEMENTS 


1. GENERAL 

Description The Hillsborough County Aviation Authority (the “Authority”) was created in 1945 as an independent special district governed 

by the Hillsborough County Aviation Authority Act, Chapter 2003-370, Laws of Florida (the “Act”). The Act provides that the Authority has 

exclusive jurisdiction, control, supervision and management over all public airports within Hillsborough County. As such, the Authority is 

authorized to issue revenue bonds to finance the construction of aviation-related projects. Revenue bonds issued by the Authority are 

payable solely from revenues of the Authority and are not obligations of the City of Tampa, Hillsborough County, or the State of Florida. 

Pursuant to the general laws of Florida, the Authority owns and operates Tampa International Airport (the “Airport”) and three general 

aviation airports (collectively the “Airport System”). 

In connection with the Authority’s issuance and sale of $67,000,000 principal amount of Revenue Bonds dated October 1, 1968, the 

Authority entered into the 1968 Trust Agreement. Since the date of its execution, the Authority has, concurrently with each revenue bond 

issue beginning in 1981, made various amendments and modifications to the terms of the original 1968 Trust Agreement. Many of these 

amendments were contingent upon the receipt of the requisite consent of the bondholders. Some amendments were prepared in “conceptual” 

form, awaiting definitive language to be prepared at the discretion of the Authority. During fiscal year 1999, the Authority received 

the requisite bondholder consent for all the definitive amendments, and the 1968 Trust Agreement, as amended was codified and 

restated (the “Trust Agreement”). 

Pursuant to the provisions of the Trust Agreement, the Authority entered into lease agreements with certain airlines (the “Signatory Airlines”) 

serving the Airport. These lease agreements provide the basis of determining airline facility rentals and landing fees on an annual basis. 

The agreements, in effect since 1970, with the Signatory Airlines serving Tampa International Airport (the “Prior Agreements”) expired on 

September 30, 1999. Effective October 1, 1999, the Authority executed new Airline-Airport Use and Lease Agreements with the Signatory 

Airlines (the “Agreements”), which have terms of seven years and expire on September 30, 2006. (See Note 3—Rate Making Policy) 

Basis of Presentation The Authority operates the Airport System as a single enterprise fund with multiple cost centers to account for the 

costs of services. Costs are recovered in the form of charges to users for such services. 

2. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES 

Basis of Accounting The Authority’s financial statements are presented in accordance with generally accepted accounting principles. The 

Authority applies all applicable pronouncements of the Financial Accounting Standards Board issued on or before November 30, 1989, 

and all applicable pronouncements required by the Governmental Accounting Standards Board (“GASB”). The Authority’s significant financial 

and accounting policies utilized in formulating these financial statements are as follows: 

Cash and Cash Equivalents For purposes of the Statements of Cash Flows, the Authority classifies investments in short-term repurchase 

agreements and investments with original maturities less than three months from the date of purchase as cash equivalents. 

Interfund Advances The Authority uses its unrestricted current assets to pre-fund or provide funding for certain projects in the Airport 

System. These amounts are shown as “Due (to) from Restricted Funds” and “Due from (to) Unrestricted Funds” in the accompanying 

Statements of Net Assets. Such advances typically are not interest bearing. 

Investments The Authority invests in overnight repurchase agreements and short-term direct treasuries which are recorded at cost. Since 

the term of the instruments is of such short duration the Authority believes cost represents their market as well as fair values. Investments 

are also held in collateralized time deposits, which are restricted in their use and may only be liquidated based on their face values. These 

deposits are collateralized by U.S. government obligations at 102% of their face values, and the collateral is marked to market at least 

weekly. The deposits are recorded at their face values, which are their market and fair values. 

Accounts Receivable The Authority provides an allowance for doubtful accounts based on the expected collectibility of outstanding balances. 

32 



Grants Grants received from federal and state governmental agencies which are restricted for the acquisition or construction of capital 

assets are recorded as contributions for capital projects when earned. Grants are earned when costs relating to such capital assets, which 

are reimbursable under the terms of the grants, have been incurred. Depreciation on assets acquired or constructed with government 

grant monies is included in “Depreciation and Amortization” in the accompanying Statements of Revenues, Expenses, and Changes in Net 

Assets. Operating grants received from the Federal Aviation Administration (“FAA”), the Transportation Security Administration, and Florida 

Department of Transportation that are used to partially offset security costs for the implementation of federally mandated security requirements 

and other related operating and maintenance costs are recorded separately from capital grants and are included as Operating Grants and 

Reimbursements in the Statements of Revenues, Expenses, and Changes in Net Assets. 

Passenger Facility Charges (“PFCs”) PFCs are imposed at $4.50 per enplaned passenger and are restricted for use on pre-approved 

projects. PFCs are recorded as contributions for capital projects in the accompanying Statements of Revenues, Expenses, and Changes in 

Net Assets. 

Supplies Inventory Inventory consists of supplies and materials used in maintenance of the Airport System and is valued at lower of 

average cost or market. The purchase of supplies inventory is from a restricted operations and maintenance fund. 

Debt Issue Costs and Bond Discounts and Premiums Debt issue costs and bond discounts and premiums are deferred in the year of 

issuance and amortized using the effective interest method over the life of the issue. Losses on bond refundings are deferred and amortized 

over the shorter of the remaining life of the original issue or the life of the new issue. 

Interest Costs Interest costs incurred during periods of construction are capitalized as a component of the assets to which these costs 

relate for all projects except those funded through the rate making process, grants and PFCs (see Note 3). In situations involving qualifying 

assets financed with the proceeds of tax-exempt debt, the amount of interest capitalized is reduced by any interest income earned on the 

temporary investment of such monies. Interest is capitalized throughout the construction period and is amortized on a straight-line basis 

over the estimated useful life of the respective asset after the project is substantially completed. 

Capital Assets Capital assets are recorded at cost and are depreciated using the straight-line method over their estimated useful lives 

as follows: 

Structures and improvements 10-40 Years 

Runways, taxiways and aprons 10-30 Years 

Equipment, furniture and fixtures 3-15 Years 

On an annual basis, the Authority evaluates the useful lives of capital assets and writes off net capitalized costs of assets with no future 

value. Net capitalized costs written off are included with the financial statement line item “Depreciation and Amortization”. 

Use of Estimates The preparation of financial statements in conformity with generally accepted accounting principles requires management 

to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and 

liabilities at the date of the financial statements and the reported amounts of contributions and expenses during the reporting period. 

Actual results could differ from those estimated. 

Revenue Classifications The components of the major operating revenue classifications are as follows: 

Airfield Fees for landing of cargo and passenger aircraft. 

Terminal Building Airline space rentals in passenger terminal building, privilege fees for the operation of terminal complex concessions 

of food and beverage, general merchandise and duty-free store, and other miscellaneous fees in terminal building. 

Airside Buildings Rentals of facilities space at airsides and other miscellaneous fees at the airside buildings. 

Commercial Landside Automobile parking fees, rent-a-car privilege fees and space rental, privilege fees for the operation of the hotel 

and permit fees of off-airport rental cars and limousine/cab. 

Cargo Cargo space rentals, apron rentals, fuel flowage fees, and other grounds rental. 

Auxiliary Airports Fees from services at all airports operated by the Authority, other than Tampa International Airport. 

General Aviation Fees from services for general aviation activities at Tampa International Airport. 

Other Fees from aviation supporting facilities provided to tenants, rentals from nonaviation properties, reimbursement for utilities, and 

other miscellaneous income. 

33

Reclassifications Certain amounts in the 2003 financial statements have been reclassified to conform to the presentation of the 2004 

financial statements. 

Recent Accounting Pronouncements In March 2003, the GASB issued Statement No. 40, Deposit and Investment Risk Disclosures, which 

amends the disclosures required by Statement No. 3, Deposits with Financial Institutions, Investments (including Repurchase Agreements), and 

Reverse Repurchase Agreements. Portions of that Statement are modified or eliminated. Accordingly, management believes that the implementation 

of this Statement will only impact the Authority’s financial statement presentation. The provisions of this Statement are effective 

for financial statements for periods beginning after June 15, 2004. 

In November 2003, the GASB issued Statements No. 42, Accounting and Financial Reporting for Impairment of Capital Assets and for 

Insurance Recoveries. This statement is effective for the Authority beginning in fiscal year 2005. Management believes that the adoption of 

this statement will have no effect on its financial position or results of operations; however, there will be improvements in financial reporting. 

Users of financial statements will better understand when impairments have occurred and what their impact is on the Authority. 

3. RATE MAKING POLICY 

The Trust Agreement states the Authority, not taking into consideration any money received from federal and state grants, PFCs, ad valorem 

taxes, and certain other monies, will fix and establish or revise, as needed, rental rates and other charges for use of the services and facilities 

of the Airport System, which will be sufficient in each fiscal year to make payments and deposits, as required under the Trust Agreement. 

Currently, all bonds and outstanding debt of the Authority are issued under the Trust Agreement, and these covenants are reiterated in 

each Official Statement of bonds issued. 

The Agreements incorporate the lease and use of the Terminal Building, Airsides A, C, D, E, F, any future Airside Buildings, and the Airfield 

at the Tampa International Airport. The Agreements establish a “compensatory” rate-making methodology where the airlines pay the 

Authority fees and charges based on the Authority’s cost of providing facilities and services. The costs to be allocated to the Signatory Airlines 

include operating and maintenance expenditures, debt service, debt service coverage of 25%, Trust Fund minimum deposit requirements, 

and a return on investment for Authority funds used for capital projects. The new Agreements incorporate all of the covenants contained in 

the Trust Agreement governing the issuance of Airport Revenue Bonds. They also provide the Signatory Airlines with a net revenue sharing 

provision. The amounts returned to the Signatory Airlines under this provision for the years ended September 30, 2004 and 2003, were 

$6,906,692 and $5,254,849, respectively. These amounts are included in accrued expenses in the accompanying Statements of Net 

Assets. The amounts are also presented as a separate item after Operating Expenses on the Statements of Revenues, Expenses, and 

Changes in Net Assets. The financial statement line item “Depreciation and Amortization” is excluded from the rate-making process. 

4. CASH AND INVESTMENTS 

At September 30, 2004, the bank balance of the Authority’s deposits and investments was $214,266,923, and the book balance was 

$176,970,802. At September 30, 2003, the bank balance of the Authority’s deposits and investments was $256,408,696, and the book 

balance was $255,569,784. The difference between the Authority’s book amount and the bank amount is due to outstanding checks and 

transfers, and deposits in transit in its demand accounts. Of the September 30, 2004 bank balance, $100,000 was covered by federal 

depository insurance and $44,310,932 was collateralized by the State of Florida collateral pool. Of the September 30, 2003 bank balance, 

$100,000 was covered by federal depository insurance and $40,318,604 was collateralized by the State of Florida collateral pool. 

The State of Florida collateral pool is a multiple financial institution pool with the ability to assess its members for collateral shortfalls if a 

member institution fails. Required collateral is defined under Chapter 280 of the Florida Statutes, Security for Public Deposits. As of 

September 30, 2004 and 2003, funds of $55,642,115 and $37,993,449 was invested in the State Board of Administration (“SBA”) 

accounts, respectively. There were no current or prior year losses, which were attributable to default by counterparties to deposit or 

investment transactions. 

The Trust Agreement allows the Authority to invest its restricted funds in direct obligations of the United States of America or obligations 

which are unconditionally guaranteed by the United States of America. Unrestricted funds may be invested at the discretion of the 

Authority in accordance with State law. 

Cash and cash equivalents and investments held at September 30, 2004 and 2003, are categorized in the following table to give an 

indication of the level of risk assumed by the Authority at year-end. Category 1 includes cash and cash equivalents and investments that 

are insured or registered or for which the securities are held by the Authority or its agent in the Authority’s name. The Authority’s Category 

1 includes cash and cash equivalents held in banks that are members of the State of Florida collateral pool, certificates of deposits and 

34 

U.S. Government Securities held in the name of the Authority and time deposits that are collateralized with securities held by the bank’s 

trust department in the Authority’s name. Category 2 includes uninsured and unregistered investments for which the securities are held by 

the bank’s trust department or agent in the Authority’s name. The Authority had no Category 2 investments at September 30, 2004 or 

2003. Category 3 includes uninsured and unregistered investments for which the securities are held by the broker or dealer, or by its trust 

department or agent, but not in the Authority’s name. The Authority’s Category 3 cash, cash equivalents and investments consist of U.S. 

Government Securities held by the bank’s trust department, but not in the name of the Authority, cash deposits held for payment of debt 

service and short-term repurchase agreements, generally executed for no longer than one month. All repurchase agreements outstanding 

at September 30, 2004 were liquidated by the Authority during October 2004. 

September 30, 2004 

Category Category Balance on Fair 

1 

___________________ 

3 

___________________ 

Deposit 

___________________ 

Value 

___________________ 

Unrestricted 

Cash and Cash Equivalents $ 68,414 

___________________ 

$29,633,142 

___________________ $ 29,701,556 

___________________ $ 29,701,556 

___________________ 

Restricted 

Repurchase Agreements $ – $21,361,063 $ 21,361,063 $ 21,361,063 

Time Deposits 22,030,063 – 22,030,063 22,030,063 

U.S. Government Securities 55,482,698 – 55,482,698 55,482,698 

Cash and Cash Equivalents 13,042,872 72,648,671 85,691,543 85,691,543 

___________________ ___________________ ___________________ ___________________ 

$ 90,555,633 $94,009,734 $184,565,367 $184,565,367 

___________________ ___________________ ___________________ ___________________ 

___________________ ___________________ ___________________ ___________________ 

September 30, 2003 

Category Category Balance on Fair 

1 

___________________ 

3 

___________________ 

Deposit 

___________________ 

Value 

___________________ 

Unrestricted 

Repurchase Agreements $ – $ 5,390,432 $ 5,390,432 $ 5,390,432 

Cash and Cash Equivalents 97,245 20,258,096 20,355,341 20,355,341 

___________________ ___________________ ___________________ ___________________ 

$ 97,245 $25,648,528 $ 25,745,773 $ 25,745,773 

___________________ ___________________ ___________________ ___________________ 

___________________ ___________________ ___________________ ___________________ 

Restricted 

Repurchase Agreements $ – $20,443,874 $ 20,443,874 $ 20,443,874 

Time Deposits 39,793,063 – 39,793,063 39,793,063 

U.S. Government Securities 136,057,580 – 136,057,580 136,057,580 

Cash and Cash Equivalents 14,452,739 19,915,667 34,368,406 34,368,406 

___________________ ___________________ ___________________ ___________________ 

$190,303,382 $40,359,541 $230,662,923 $230,662,923 

___________________ ___________________ ___________________ ___________________ 

___________________ ___________________ ___________________ ___________________ 

35

5. RESTRICTED ASSETS 

The Trust Agreement, among other things, requires all airport revenues, excluding PFCs, grants, bond proceeds and their earnings, and 

revenues from certain nontrust funded projects, be deposited in the Revenue Fund, the establishment of certain trust accounts, and 

defines the priority and flow of cash receipts. Certain of these trust accounts require specified balances and are restricted as to use. Bond 

proceeds issued for construction are held by a trustee appointed by the Authority per the bond agreement. Debt Service and Debt 

Reserve accounts are held by a trustee designated by the Trust Agreement and are pledged as collateral for debt service. A summary of 

the balances in these accounts as of September 30, 2004 and 2003, is as follows: 

36 

Trust Account Name 2004 2003 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Restricted for debt service: 

Bond Principal, Interest and Redemption Sinking Fund $ 896,284 $ 2,143,612 

Bond Reserve Fund 

Restricted to acquisition of property and equipment: 

62,543,376 62,689,814 

Equipment Fund 483,244 340,958 

Construction Funds 

Restricted to operating expenses: 

53,491,991 135,294,759 

Operating Reserve Account 11,175,245 10,473,444 

Operation and Maintenance 6,209,415 

___________________ 

5,002,909 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

134,799,555 215,945,496 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Other restricted funds: 

Revenue Funds 15,128,425 17,148,856 

Escrow and Forfeiture Deposits 724,567 687,027 

Capital Acquisition 10,045,488 14,249,728 

Supplies Inventory and Other Current Assets 492,582 482,752 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

26,391,062 32,568,363 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Due from unrestricted assets 3,997,507 7,735,757 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total current restricted assets $165,188,124 $256,249,616 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

6. LEASES 

The Authority is the lessor of various properties at Tampa International Airport. Among these properties are the concession areas, restaurants 

and lounges, airsides and rental car areas. All leases are cancelable. In 1981, the Authority constructed an airline reservation center. 

The facility is under a direct financing lease with Continental Airlines, Inc. In connection with the lease agreement, the Authority received 

$429,000 annually in year 2004 and will receive $222,000 in year 2005 under the agreement. The components of the lease agreement 

at September 30, 2004 and 2003 are as follows: 


___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Net minimum lease payments receivable $222,143 $650,707 

Less unearned income (18,342) 

___________________ 

(70,556) 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Net investment in direct financing lease 203,801 580,151 

Less current portion (203,801) 

___________________ 

(376,350) 

_ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Net long-term investment in direct financing lease $ – $203,801 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

7. CAPITAL ASSETS 

Capital asset activity for the years ended September 30, 2004 and 2003 is summarized as follows: 

Balance Additions Deletions Balance 

October 1, and and September 30, 

2003 Reclasses Reclasses 2004 

___________________ ___________________ ___________________ ___________________ 

Land $125,676,159 $ 9,819,458 $ 332,987 $ 135,828,604 

Construction in progress 120,128,533 150,515,918 (149,418,649) 121,225,802 

Equipment 14,633,559 733,216 (474,116) 14,892,659 

Buildings and improvements 1,037,868,376 146,302,751 (2,897,407) 1,181,273,720 

___________________ ___________________ ___________________ ___________________ 

1,298,306,627 307,371,343 (152,457,185) 1,453,220,785 

Less accumulated depreciation (404,734,215) 

___________________ 

(55,268,382) 

___________________ 

8,352,484 

___________________ 

(451,650,113) 

___________________ 

Total capital assets—net $893,572,412 $252,102,961 $(144,104,701) $1,001,570,672 

___________________ ___________________ ___________________ ___________________ 

___________________ ___________________ ___________________ ___________________ 

37

Balance Additions Deletions Balance 

October 1, and and September 30, 

2002 Reclasses Reclasses 2003 

___________________ ___________________ ___________________ ___________________ 

Land $125,065,011 $ 455,349 $ 155,799 $125,676,159 

Construction in progress 138,977,656 156,396,099 (175,245,222) 120,128,533 

Equipment 14,711,972 1,775,792 (1,854,205) 14,633,559 

Buildings and improvements 873,767,824 176,095,766 (11,995,214) 1,037,868,376 

___________________ ___________________ ___________________ ___________________ 

1,152,522,463 334,723,006 (188,938,842) 1,298,306,627 

Less accumulated depreciation (375,810,004) 

___________________ 

(40,643,235) 

___________________ 

11,719,024 

___________________ 

(404,734,215) 

___________________ 

Total capital assets–net $776,712,459 $294,079,771 $(177,219,818) $893,572,412 

___________________ ___________________ ___________________ ___________________ 

___________________ ___________________ ___________________ ___________________ 

Depreciation expense and amortization of capitalized interest during the years ended September 30, 2004 and 2003, were $55,623,082 

and $40,643,235, respectively. These amounts are included in Depreciation and Amortization in the accompanying Statements of 

Revenues, Expenses, and Changes in Net Assets. 

Net capitalized costs written off for assets that were disposed of during the years ended September 30, 2004 and 2003, were $3,406,112 

and $222,716, respectively. These amounts are included in Depreciation and Amortization in the accompanying Statements of Revenues, 

Expenses, and Changes in Net Assets. 

8. NOTES PAYABLE AND DEBT 

Revenue Bonds All revenue bonds issued by the Authority are parity bonds and have been issued under the terms of the Trust 

Agreement and supplements thereto. The bonds are payable solely from revenues, as defined in the Trust Agreement, after the payment 

of the cost of operation and maintenance expenses. 

During the years ended September 30, 2004 and 2003, the Authority redeemed serial revenue bonds in the amounts of $19,395,000 

and $18,440,000, respectively. Total interest cost incurred on outstanding bonds during the years ended September 30, 2004 and 2003, 

was $32,818,000 and 29,935,200, respectively. Of these interest amounts, $9,002,362 and $5,066,443 were capitalized, respectively. 

Amortization of bond issue costs was $885,897 and $673,204 in fiscal years 2004 and 2003, respectively. 

On February 19, 2003, the Authority issued the Tampa International Airport Revenue Bonds 2003 Series A and B, in the amounts of 

$195,290,000 and $43,735,000, respectively. The Series A Bonds were issued with a premium of $13,177,466, at rates of 5.00% to 

5.50% and maturities from 2007 to 2018. The Series B Bonds were issued with a premium of $335,617, at rates of 4.25% to 5.25% and 

maturities from 2012 to 2020. The proceeds of the 2003 Series A and B Bonds are being be used to pay a portion of the 2003 Project 

costs, which include the Airside C development program, the exterior dynamic sign package, the outbound baggage system and security 

enhancements, the service building expansion and the refunding of $50,000,000 of commercial paper notes. 

On July 8, 2003, the Authority issued $151,405,000 of Tampa International Airport Revenue Refunding Bonds, 2003 Series C and D. The 

Series C Bonds were issued at a par amount of $94,375,000 with a premium of $10,164,074 and interest rates from 2.00% to 5.25%, to 

currently refund the 1993 Series B Bonds maturing on or after October 1, 2004, outstanding in the principal amount of $100,675,000. 

Debt service payments through June 2003 of $1,383,574, a reduction in the debt service reserve funds of $969,654, less issuance costs 

and insurance premium of $1,695,621, and the issue proceeds were used to purchase U.S. Government securities that were placed in an 

irrevocable trust to pay all interest, principal and call premium on the 1993 Series B bonds maturing on or after October 1, 2004 until 

their call date of October 1, 2003. The final maturity of the refunding bonds was the same as the refunded bonds, and the refunding 

resulted in a decrease in debt service over 17 years of $15,863,957 with a calculated net present value savings of $10,828,882, discounted 

at an effective interest rate of 3.74%. 

The 2003 Series D Bonds were issued at a par amount of $57,030,000 and a premium of $4,958,499, with interest rates from 3.00% to 

5.50%, to currently refund the 1993 Series D Bonds maturing on or after October 1, 2004, outstanding in the principal amount of 

$59,340,000. Debt service payments through June 2003 of $788,795, a reduction in the debt service reserve funds of $261,778, less 

issuance costs and insurance premium of $1,087,191, and the issue proceeds were used to purchase U.S. Government securities which 

38 

were placed in an irrevocable trust to pay all interest, principal and call premium on the 1993 Series D bonds maturing on or after 

October 1, 2004 until their call date of October 1, 2003. The final maturity of the refunding bonds was the same as the refunded bonds, 

and the refunding resulted in a decrease in debt service over 21 years of $5,349,693 with a calculated net present value savings of 

$3,467,243, discounted at an effective interest rate of 3.74%. 

The total principal maturities and debt service requirements for all revenue bonds through the year 2023, as of September 30, 2004, are 

as follows: 

Total 

Principal Interest Debt Service 

___________________ ___________________ ___________________ 

2005 $ 20,165,000 $ 32,047,488 $ 52,212,488 

2006 21,065,000 31,148,943 52,213,943 

2007 34,200,000 30,143,098 64,343,098 

2008 35,885,000 28,461,584 64,346,584 

2009 37,700,000 26,637,221 64,337,221 

2010 to 2023 464,095,000 153,847,234 617,942,234 

___________________ ___________________ ___________________ 

$613,110,000 $302,285,568 $915,395,568 

___________________ ___________________ ___________________ 

___________________ ___________________ ___________________ 

Revenue bond information and activity as of and for the years ended September 30, 2004 and 2003, is presented below. All principal 

payments are due October 1, while interest is due semi-annually on April 1 and October 1. Since all debt service payments required 

under the Trust Agreement are deposited with the Trustee as of September 1, 2004 and 2003, it is the Authority’s policy to record the 

October 1 principal and interest payments as of the close of business on September 30. 


Amounts Due Amounts Due 

Balance Within One Balance Within One 

Outstanding 

___________________ 

Year 

___________________ 

Outstanding 

___________________ 

Year 

___________________ 

Revenue and Revenue Refunding Bonds: 

1996A Series, 5.0% to 6.0% $ 23,490,000 $ 715,000 $ 24,170,000 $ 680,000 

1996B Series, 4.9% to 6.0% 51,060,000 1,565,000 52,550,000 1,490,000 

1997A Series, 5.0% to 5.75% 51,880,000 5,515,000 57,120,000 5,240,000 

1997B Series, 5.125% 26,900,000 – 26,900,000 – 

1999A Series, 4.0% to 5.25% 17,610,000 2,180,000 19,695,000 2,085,000 

2001A Series, 4.0% to 5.5% 57,690,000 4,105,000 61,640,000 3,950,000 

2003A Series, 5.0% to 5.5% 195,290,000 – 195,290,000 – 

2003B Series, 4.25% to 5.25% 43,735,000 – 43,735,000 – 

2003C Series, 2.0% to 5.25% 90,170,000 4,290,000 94,375,000 4,205,000 

2003D Series, 3.0% to 5.5% 55,285,000 1,795,000 57,030,000 1,745,000 

___________________ ___________________ ___________________ ___________________ 

613,110,000 $20,165,000 632,505,000 $19,395,000 

___________________ ___________________ 

___________________ ___________________ 

Unamortized deferred loss on bond refunding (11,245,784) (12,890,126) 

Unamortized bond premium—net 26,017,401 29,388,585 

___________________ ___________________ 

Total revenue bonds payable $627,881,617 $649,003,459 

___________________ ___________________ 

___________________ ___________________ 

39

Balance Balance 

September 30, September 30, 

2003 Additions Refunding Paydowns 2004 

________________ ________________ ________________ ________________ ________________ 

1996A Revenue Bonds $ 24,170,000 $ – $ – $ (680,000) $ 23,490,000 

1996B Revenue Bonds 52,550,000 – – (1,490,000) 51,060,000 

1997A Revenue Bonds 57,120,000 – – (5,240,000) 51,880,000 

1997B Revenue Bonds 26,900,000 – – – 26,900,000 


2001A Revenue Refunding Bonds 61,640,000 – – (3,950,000) 57,690,000 

2003A Revenue Bonds 195,290,000 – – – 195,290,000 


2003C Revenue Refunding Bonds 94,375,000 – – (4,205,000) 90,170,000 

2003D Revenue Refunding Bonds 57,030,000 – – (1,745,000) 55,285,000 

________________ ________________ ________________ ________________ ________________ 

$632,505,000 $ – $ – $(19,395,000) $613,110,000 

________________ ________________ ________________ ________________ ________________ 

________________ ________________ ________________ ________________ ________________ 

Balance Balance 

September 30, September 30, 

2003 Additions Refunding Paydowns 2004 

________________ ________________ ________________ ________________ ________________ 

1993B Refunding Bonds $104,600,000 $ – $(100,675,000) $ (3,925,000) $ – 

1993D Revenue Bonds 61,015,000 – (59,340,000) (1,675,000) – 

1996A Revenue Bonds 24,815,000 – – (645,000) 24,170,000 

1996B Revenue Bonds 53,970,000 – – (1,420,000) 52,550,000 




2001A Revenue Refunding Bonds 65,430,000 – – (3,790,000) 61,640,000 

2003A Revenue Bonds – 195,290,000 – – 195,290,000 

2003B Revenue Bonds – 43,735,000 – – 43,735,000 

2003C Revenue Refunding Bonds – 94,375,000 – – 94,375,000 

2003D Revenue Refunding Bonds – 57,030,000 – – 57,030,000 

________________ ________________ ________________ ________________ ________________ 

$420,530,000 $390,430,000 $(160,015,000) $(18,440,000) $632,505,000 

________________ ________________ ________________ ________________ ________________ 

________________ ________________ ________________ ________________ ________________ 

Tax Exempt Subordinated Commercial Paper Notes (“Commercial Paper Notes”) On September 21, 2001, the Authority entered 

into a Reimbursement Agreement with Landesbank Baden-Württemberg, acting through its New York Branch (the “Bank”). Under this 

agreement, the Authority is allowed to issue an aggregate principal amount, not-to-exceed $105,000,000 outstanding at any one time, of 

Commercial Paper Notes collateralized by the Bank’s credit. The Commercial Paper Notes may be renewed until 2006 in up to 180-day 

increments and are subordinated to the Authority’s general revenue bonds. 

At September 30, 2004, there was $64,276,000 of Commercial Paper Notes outstanding with interest rates from 1.17% to 1.43%. At 

September 30, 2003, there was $69,276,000 of Commercial Paper Notes outstanding with interest rates from .85% to 1.00%. Total interest 

costs incurred on outstanding Commercial Paper Notes during the years ended September 30, 2004 and 2003, were $1,169,721 and 

$1,505,553, respectively. Amortization of Commercial Paper Notes issue costs in fiscal years 2004 and 2003, were $80,982 and $78,594, 

respectively. 

On February 19, 2003, the Authority refunded $50,000,000 of the outstanding Commercial Paper Notes with proceeds from the 2003 

Series A and B Tampa International Airport Revenue Bonds. On March 10, 2003, the Authority issued additional Series B Commercial 

40 

Paper Notes in the amount of $14,276,000 with an interest rate of 1.05% to fund the repayment of the note payable to the State of 

Florida (see Payable to the State of Florida). 

Payable to the State of Florida At September 30, 2002, the Authority had an unsecured note, with no state interest rate, payable to 

the State of Florida in connection with Joint Participation Agreements for the Drew Park Land Acquisition Program and the Runway 9-27 

Clear Zone Land Acquisition in the amount of $14,257,667. On March 10, 2003 the Authority repaid the note in full with proceeds from 

the issuance of Commercial Paper Notes. 

Special Purpose Revenue Bonds Under provisions of the Trust Agreement, Special Purpose Revenue Bonds may be issued by the 

Authority for the purpose of construction and acquisition of special purpose facilities. Special Purpose Revenue Bonds are not an obligation 

of the Authority, and are issued on the credit of the facility user. Special Purpose Revenue Bonds were issued in prior years by Delta 

Airlines and US Airways for the construction of aircraft maintenance facilities and by the fixed base operator of the general aviation facility 

at the Airport for the construction of an aircraft hangar, maintenance and storage facility. On January 16, 2003, US Airways rejected the 

ground lease portion of the maintenance facility they occupied and subsequently vacated the facility. Under the terms of the documents 

associated with the agreement, the Authority must use its best efforts for a two-year period to re-let the facility. Semi-annual interest payments 

due on the bonds (principal outstanding in the amount of $27,620,000) since January 15, 2003 have not been made by US 

Airways and the bonds are in default. At September 30, 2004 and 2003, a total of $55,944,039 of Special Purpose Revenue Bonds is outstanding. 

The Special Purpose Revenue Bonds have been excluded from the accompanying financial statements. 

9. CONTRIBUTIONS 

The Authority has received capital contributions by means of federal and state grants and Passenger Facility Charges as follows: 


___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Passenger facility charges $34,765,028 $31,182,018 

Federal 7,801,042 14,217,389 

State 12,014,963 12,153,430 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

Total contributions for capital projects $54,581,033 $57,552,837 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

___________________ _ _ _ _ _ _ _ _ _ _ _ _ _ _ 

10. COMMITMENTS 

Construction and Maintenance Contracts In connection with the Authority’s ongoing capital and maintenance programs, certain construction 

and long-term maintenance contracts have been executed for services which are incomplete. These contracts are typically cancelable 

by either party with a 30 days’ advance notice. 

Defined Benefit Pension Plan All Authority full-time employees are required to participate in the Florida Retirement System (the “FRS”), a 

multiple-employer cost-sharing retirement system administered by the Division of Retirement, Department of Management Services of the 

State of Florida. The FRS is a defined benefit pension plan, qualified under Section 401 (a) of the Internal Revenue Code. Benefits and 

contributions are established by Chapter 121, Florida Statutes, and may only be amended by an act of the Florida Legislature. 

The FRS Annual Report provides financial statements and required supplementary information for the FRS. The report is compiled by and is 

available from the State of Florida, Division of Retirement, 2639-C North Monroe Street, Tallahassee, Florida 32399-1560. 

FRS provides retirement, disability and death benefits and an annual cost-of-living adjustment to plan members. Regular participants who 

retire at or after age 62, with ten years of service (or six years of service on or after July 1, 2002) or after thirty years of service, regardless 

of age, are entitled to a retirement benefit, payable monthly for life, equal to their years of service times a percentage value (ranging from 

1.6% to 1.68%) multiplied by their average final compensation. Special risk participants who retire after age 55, with ten years of service 

(or six years of services on or after July 1, 2002), or after twenty-five years of service, regardless of age, receive a similar benefit (ranging 

from 2.00% to 3.00%). Senior Management Service Class (“SMSC”) participants, who retire at or after age 62, with seven years of SMSC 

service; or with ten years of service (or six years of services on or after July 1, 2002) and age 62; or with thirty years of service regardless 

of age, receive a similar benefit (2.0%) multiplied by their average final compensation. Alternatively, SMSC participants may elect to 

41

participate in a local annuity plan. Average final compensation is the employee’s average salary over their highest five fiscal years’ earnings. 

Vested employees may retire after vesting, but before normal retirement, and receive reduced retirement benefits. 

FRS members are required to contribute monthly amounts on behalf of their employees at actuarially determined rates expressed as percentages 

of covered payroll. For FRS fiscal years 2004 and 2003, which ended on June 30th, the contribution percentage of payroll was 

7.39% for regular participants, 18.53% for special risk participants, and 9.11% for DROP participants. Total contributions for FRS fiscal years 

2004 and 2003 were $1,950,839 and $1,495,049, which equaled 8.61%, and 7.07% of payroll, respectively. The Authority’s contributions 

represented less than one percent of total contributions required of all participating members. The total contributions for fiscal years 2004 

and 2003 were 100% of the required amount. 

Effective July 1, 1998, the Florida Legislature established a Deferred Retirement Option Program (“DROP”). This program allows eligible 

employees to defer receipt of monthly retirement benefit payments while continuing employment with a Florida Retirement System employer 

for a period not to exceed sixty months after electing to participate. Deferred monthly benefits are held in the Florida Retirement System 

Trust Fund and accrue interest. 

Defined Contribution Plan Beginning December 1, 2002, the FRS offered a second retirement plan option, the FRS Investment Plan. 

Under this plan the employer pays all contributions, which are a percentage of salary based on the FRS Membership Class. The employer 

contributes to an account in the employee’s name. The employee makes investment elections within the investment funds chosen by the 

State Board of Administration. The retirement benefit is based on the account balance, and the benefit is vested after one year of service. 

If an employee leaves the job, he or she can keep the benefit in the FRS, or transfer his or her account to another retirement plan. The 

employee can also elect to cash out the benefit when leaving, but the distribution is subject to tax penalties for taking early withdrawal. 

The employee in this plan is not eligible for DROP. All employees in the FRS pension plan were given a choice of switching from the FRS 

pension plan to the FRS Investment Plan within a designated time period. 

Compensated Absences The Authority provides for compensated absences to its employees through employee benefit programs. Under 

the programs, employees are provided compensated absences for sick and vacation time, as well as related retirement amounts. Amounts 

owed under the programs were $2,875,177 and $2,624,773 at September 30, 2004 and 2003, respectively. These amounts are 

recorded as accrued expenses in the Statements of Net Assets. 

11. CONTINGENCIES 

The Authority is involved in litigation and claims as defendant or plaintiff arising in the ordinary course of operations. In the opinion of 

management, the range of potential recoveries or liabilities will not materially affect the financial position of the Authority. 

42 

George J. Bean 

October 4, 1924 – June 8, 2004 

With great sadness we saw the passing of George J. Bean, 

executive director of Tampa International Airport from 

1965 through July 1996. 

The Tampa Bay community is forever grateful for the 

significant professional and personal contributions 

Mr. Bean made not only to Tampa, but to the 

worldwide progress of civil air transportation. 

Thanks to his leadership, intelligence and 

guidance, the Aviation Authority underwent 

tremendous change during his tenure as 

CEO of Tampa International Airport. 

We will all continue to hold him in the 

greatest affection and respect. 

In Memory

Passenger 

Airlines 

Air Canada 

AirTran Airways 

AirTran JetConnect 

America West 

American 

British Airways 

Cayman Airways 

Continental 

Continental Express 

Delta 

Delta Connection/ASA 

Delta Connection/Chautauqua 

Delta Connection/Comair 

Frontier 

Independence Air 

JetBlue 

L.B. Limited 

Midwest 

Northwest 

Southwest 

Song 

Spirit 

Sun Country 

Ted 

United 

USA 3000 

US Airways 

WestJet 

Regionals/ 

Commuters 

American Eagle 

Cape Air 

Gulfstream International 

US Airways Express/Air Midwest 

All-Cargo 

Airlines 

ABX, Inc. Airborne Express 

ASTAR Air Cargo, Inc. 

Bankair, Inc. 

Federal Express Corporation 

Flight Express, Inc. 

U.S. Check 

Design – The HLA Group 

Photography – David Lawrence 

Publisher – Brenda S. Geoghagan 

P.O. Box 22287 ■ Tampa, Florida 33622 USA 

813-870-8700 ■ fax 813-875-6670 

www.TampaAirport.com 

Hillsborough County Aviation Authority 

Peter O. Knight Airport ■ Plant City Airport ■ Vandenberg Airport

2004 Financial Report - Tampa International Airport

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