new arrivals bold departures

NOTES TO FINANCIAL STATEMENTS December 31, 2006
4. long-term debt (continued)
The Authority is required to maintain an Operating and Maintenance
Reserve Fund of approximately $5.9 million. The Operating and Maintenance
Reserve Fund must be established and funded as required by the Master Trust
Indenture, for the benefit of bondholders. The balance in the Fund is equal to
at least 25% of certain defined operating and maintenance expenses for the
previous fiscal period. For 2007, approximately $6.6 million will be required
to fund the Operating and Maintenance Reserve Fund. The Operating and
Maintenance Reserve Fund may be satisfied by cash, letters of credit, or the
undrawn availability under a committed credit facility.
Deferred Financing Costs
2006 2005
(in thousands of dollars) $ $
Deferred financing costs 3,912 –
Less: Accumulated amortization (50) –
3,862 –
Capitalized Interest
Interest on long-term debt of $1,966,365 (2005 - $260,596) was capitalized as
part of construction in progress during the year.
Debt Forgiveness
During 2005, Transport Canada agreed to forgive $1.2 million of debt, which
is included in other revenue.
5. airport improvement fees
On January 1, 2001, the Authority implemented an AIF of $10 per local
boarded passenger to fund the cost of a major capital program. These fees
are collected by the air carriers for a fee of 6% under an agreement between
the Authority, the Air Transport Association of Canada, and the air carriers
serving Halifax Robert L. Stanfield International Airport. Under the agreement,
AIF revenues may only be used to pay for the capital and related financing
costs as jointly agreed with air carriers operating at the airport.
5. airport improvement fees (continued)
A summary of the AIF collected and capital and related financing
expenditures are as follows:
2006 2005
(in thousands of dollars) $ $
AIF revenue (net):
AIF revenue 13,122 12,459
AIF collection costs (806) (752)
12,316 11,707
Interest on surplus funds 1,756 —
Net funds received 14,072 11,707
Capital expenditures funded by AIF 44,388 50,398
Interest expense funded by AIF 2,762 —
47,150 50,398
Excess of expenditures over AIF revenue 33,078 38,691
Excess of expenditures over AIF revenue,
beginning of year 59,725 21,034
Excess of expenditures over AIF revenue,
end of year 92,803 59,725
From January 1, 2001 to December 31, 2006, the cumulative capital
expenditures totaled $157,241,000 (2005 - $110,091,000) and exceeded the
cumulative amount of AIF revenue by $92,803,000 (2005 - $59,725,000).
Net assets of the Authority as at December 31 are as follows:
2006 2005
(in thousands of dollars) $ $
Net assets provided by airport improvement fees 55,147 50,366
Net assets provided by other operations 31,868 26,203
Net assets, end of year 87,015 76,569
H A L I F A X I N T E R N A T I O N A L A I R P O R T A U T H O R I T Y 2 0 0 6 A N N U A L R E P O R T 19