RMMA + FAA Funding
During the May 10, 2021 CNR meeting, John Bauer, Manager, Denver Airports District Office, stated that there is "no buyout when land is involved". While perhaps "technically" correct, this is factually incorrect. In fact, the FAA does have the authority to "release" land that is subject to grant assurances as evidenced by the attached Federal Register notices from 2013 and 2015 entitled Notice of Intent To Rule on Request To Release Airport Property at Rocky Mountain Metropolitan Airport, Broomfield, Colorado. A "buyout" is allowed for the unamortized portion of an airport grant.
In 2013, the FAA approved the release of 120 acres of land "at fair market value" with proceeds used "to complete a much needed taxiway". In 2015, the FAA approved the release of 449 acres for the expected future use "for non-aviation development associated with the Verve Innovation Park, as well as the realignment of Simms Street to allow for more aviation development to the east".
Interestingly, both the 2013 and 2015 notices were issued by John Bauer.
During the May 10 CNR meeting, Bauer also referred to Grant Assurance 5 - Preserving Rights & Powers and stated that "because Jeffco took money, they can't cede decision making to anyone else.". Bauer made this statement in reference to Matt Jones' comment that the CNR should have equal weight in advising Jefferson County as the AAB has. See excerpt below from attached document Airport Sponsor & User Rights And Responsibilities: Grant Assurance 5, Preserving Rights and Powers, requires, in pertinent part, that the sponsor of a federally obligated airport:
In 2013, the FAA approved the release of 120 acres of land "at fair market value" with proceeds used "to complete a much needed taxiway". In 2015, the FAA approved the release of 449 acres for the expected future use "for non-aviation development associated with the Verve Innovation Park, as well as the realignment of Simms Street to allow for more aviation development to the east".
Interestingly, both the 2013 and 2015 notices were issued by John Bauer.
During the May 10 CNR meeting, Bauer also referred to Grant Assurance 5 - Preserving Rights & Powers and stated that "because Jeffco took money, they can't cede decision making to anyone else.". Bauer made this statement in reference to Matt Jones' comment that the CNR should have equal weight in advising Jefferson County as the AAB has. See excerpt below from attached document Airport Sponsor & User Rights And Responsibilities: Grant Assurance 5, Preserving Rights and Powers, requires, in pertinent part, that the sponsor of a federally obligated airport:
“...will not take or permit any action which would operate to deprive it of any of the rights and powers necessary to perform any or all of the terms conditions, and assurances in the grant agreement without the written approval of the Secretary, and will act promptly to acquire, extinguish or modify any outstanding rights or claims of right of others which would interfere with such performance by the sponsor.” |
Bauer did not amend his statement about Jeffco ceding decision making power to add context even after Marc Lacis clarified the intent of Jones' statement by saying that he believed that Jones is suggesting that the CNR would "add a counterbalancing voice to airport decisions and growth".
Jefferson County 2019 Financial Statement
RMMA - AIP Funding Schedule 2020-2030
The 2026 $9 million for the primary runway "rehab/strengthening (construction)" is ominous.
They spent $9 million in 2014 to strengthen that runway (and other funds to strengthen the secondary runway in 2016) - to accommodate larger jets with wider wingspans and faster approach speeds. Strengthened it from 75,000 to 100,000 pounds - a main violation of the Rock Creek Ranch Avigation Easement Agreements.
Centennial cannot accommodate 100,000 pounds.
They spent $9 million in 2014 to strengthen that runway (and other funds to strengthen the secondary runway in 2016) - to accommodate larger jets with wider wingspans and faster approach speeds. Strengthened it from 75,000 to 100,000 pounds - a main violation of the Rock Creek Ranch Avigation Easement Agreements.
Centennial cannot accommodate 100,000 pounds.
RMMA 2021 Adopted Budget
General Thoughts
|
Definition of an “Enterprise Fund” in Jeffco’s FS is misleading and might actually be a false statement.
From Jeffco’s 12/31/19 FS: The Enterprise Fund accounts for operations that are financed and operated in a manner similar to private business enterprises – where the costs (expenses, including depreciation) of providing goods or services to the general public are being financed or recovered primarily through user charges on a continuing basis. Rocky Mountain Metropolitan Airport - This fund is the County’s single enterprise fund. P 21 2019 FS – Overview Of The Basic Financial Statements These statements distinguish the functions of the County that are principally supported by taxes and intergovernmental revenues (governmental activities) from others that are expected to recover all or most of their expenses from user fees and charges (business-type activities). The governmental activities include general government, public safety, highways and streets, culture and recreation, economic development, welfare, and sanitation. The business-type activity is made up solely of the Rocky Mountain Metropolitan Airport. Definition of Intergovernmental Revenue: The U.S. Census Bureau defines intergovernmental revenue as, "amounts received from other governments as fiscal aid in the form of shared revenues and grants-in-aid, as reimbursements for performance of general government functions and specific services for the paying government (e.g., care of prisoners or contractual research), or in lieu of taxes, Excludes amounts received from other governments for sale of property, commodities, and utility services. All intergovernmental revenue is classified as General revenue. Make a formal request for Jeffco auditors to confirm. Based on Jeffco's 12/31/19 financial statement, RMMA
|
There's no way to tell from this data what percentage of fuel is used for the local flight training schools who fly continuous racetrack loops over our communities, but the data is out there.
The FAA and Jeffco have contributed $39,719 million dollars in grants to RMMA between 2010-2019, compared to revenues generated by RMMA of $33,682 million during the same period. So, RMMA isn't even supporting half of their operations. WE TAXPAYERS ARE FUNDING THE MAJORITY OF RMMA!!! What is an Enterprise Fund? An enterprise fund is a self-supporting government fund that sells goods and services to the public for a fee. An enterprise fund uses the same accounting framework followed by entities in the private sector, such as GAAP or IFRS. Example of an Enterprise Fund For example, a government-owned power generating facility provides electricity to local homeowners in exchange for a fee. JeffCo's definition says something completely different: From Jeffco’s 12/31/19 FS: The Enterprise Fund accounts for operations that are financed and operated in a manner similar to private business enterprises – where the costs (expenses, including depreciation) of providing goods or services to the general public are being financed or recovered primarily through user charges on a continuing basis. When Use of Enterprise Fund Is Required Activity is financed with debt that is secured solely by a pledge of the net revenues from fees and charges of the activity Laws or regulations require that the activity’s costs of providing services, including capital costs (such as depreciation or debt service), be recovered with fees and charges Pricing policies of the activity establish fees and charges designed to recover its costs, including capital costs |
Formal Request Made:
I also have a question about the description/definition of "Enterprise Fund" contained the JeffCo's 12/31/19 financial statement, page 143. It reads:
The Enterprise Fund accounts for operations that are financed and operated in a manner similar to private business enterprises – where the costs (expenses, including depreciation) of providing goods or services to the general public are being financed or recovered primarily through user charges on a continuing basis.
Rocky Mountain Metropolitan Airport - This fund is the County’s single enterprise fund.
Additionally on page 21:
These statements distinguish the functions of the County that are principally supported by taxes and intergovernmental revenues (governmental activities) from others that are expected to recover all or most of their expenses from user fees and charges (business-type activities). The governmental activities include general government, public safety, highways and streets, culture and recreation, economic development, welfare, and sanitation. The business-type activity is made up solely of the Rocky Mountain Metropolitan Airport.
The definition of an "Enterprise Fund" contained in the notes to JeffCo's audited financial statement don't match the actual financial results achieved by Rocky Mountain Metropolitan Airport (RMMA).
One commonly accepted definition of an Enterprise Fund is:
"A self-supporting government fund that sells goods and services to the public for a fee. The accounting framework followed by an Enterprise Fund is the same accounting framework followed by entities in the private sector (i.e. GAAP and IFRS).
RMMA is not "self-supporting" or "operated in a manner similar to a private business enterprise". The goods and services that RMMA provides to the general public are not "financed or recovered through user charges on a continuing basis". RMMA only generates revenues in an amount sufficient to cover less than 50% of its expenses and capital expenditures. RMMA is reliant on AIP and other grants from the FAA, and loans from Jefferson County and the State of Colorado, to fund the majority of its expenses and capital improvement projects.
In summary, JeffCo's classification of RMMA as an "Enterprise Fund" using the definitions that JeffCo provides in their audited financial statements is misleading to any reader. I would really appreciate your help in shedding some light on this.
The Enterprise Fund accounts for operations that are financed and operated in a manner similar to private business enterprises – where the costs (expenses, including depreciation) of providing goods or services to the general public are being financed or recovered primarily through user charges on a continuing basis.
Rocky Mountain Metropolitan Airport - This fund is the County’s single enterprise fund.
Additionally on page 21:
These statements distinguish the functions of the County that are principally supported by taxes and intergovernmental revenues (governmental activities) from others that are expected to recover all or most of their expenses from user fees and charges (business-type activities). The governmental activities include general government, public safety, highways and streets, culture and recreation, economic development, welfare, and sanitation. The business-type activity is made up solely of the Rocky Mountain Metropolitan Airport.
The definition of an "Enterprise Fund" contained in the notes to JeffCo's audited financial statement don't match the actual financial results achieved by Rocky Mountain Metropolitan Airport (RMMA).
One commonly accepted definition of an Enterprise Fund is:
"A self-supporting government fund that sells goods and services to the public for a fee. The accounting framework followed by an Enterprise Fund is the same accounting framework followed by entities in the private sector (i.e. GAAP and IFRS).
RMMA is not "self-supporting" or "operated in a manner similar to a private business enterprise". The goods and services that RMMA provides to the general public are not "financed or recovered through user charges on a continuing basis". RMMA only generates revenues in an amount sufficient to cover less than 50% of its expenses and capital expenditures. RMMA is reliant on AIP and other grants from the FAA, and loans from Jefferson County and the State of Colorado, to fund the majority of its expenses and capital improvement projects.
In summary, JeffCo's classification of RMMA as an "Enterprise Fund" using the definitions that JeffCo provides in their audited financial statements is misleading to any reader. I would really appreciate your help in shedding some light on this.
RMMA Purported Economic Impact
|
You will hear PA and TKT and other airport supporters say that RMMA has a $730 million dollar "economic impact" on the region. They get this number from the 2020 CDOT Aeronautical report which is based on 2018 data. I'll leave it to you to figure out "economic impact" because I can't explain it, and I guarantee you that PA and TKT can't explain it either. There are so many estimates and double counting of actual dollars that I can't wrap my head around it. It's so exaggerated that I can't even understand why it's relevant. But, politicians love it.
I have attached a draft version of some charts that have sales tax and state income tax paid, real dollars that can be used to pay something, that I compiled from the 2020 CDOT report. A large part of this data is estimated because annual payroll for many businesses at the airport are estimated. Table 6.11 shows that BJC contributed a total of $6,664,090 in sales tax and state income tax. Only the $4,247,780 sales tax has a direct local impact because the other is "state" income tax. This is the "real dollar" amount that generates the $780 million "economic impact" that RMMA contributes to the region. Effectively, the $6.7 million gets multiplied 117 times and becomes $780 million. The total $6.7mm tax generated by RMMA is a drop in the bucket for the combined annual budget for the 3 counties. It would be really interesting to find other business that generate the same level of actual dollars and economic impact to see how they compare. I'd be willing to bet that most of them don't negatively impact the community like RMMA does. Back to your question of how Broomfield and Boulder counties benefit from RMMA. Some of the folks who are employed by the airport live in Boulder and Broomfield counties and spend their earnings, and this generates sales tax and property tax revenue. |
It blows my mind that we have 56 GA airports in Colorado that contribute, in total, only $53 million in annual sales tax and state income tax. I'd have to look back at some other data that I complied previously but I believe 37 of these airports have 10,000 or less ops annually. Some of the airports only have 3 or 10 departures and arrivals a day, and they are heavily subsidized by FAA. Why do we need all of these airports in Colorado? I know the entire GA airport system was birthed after WW II and someone thought it was necessary to have lots of airstrips so we could defend ourselves against enemies. Some of it was also the government spending money on infrastructure to generate jobs, and tax revenue, etc.
Centennial contributes 57.5% of total GA airport tax revenue, or 4.5 times the amount that RMMA contributes (12.7%), while generating only 87% more operations than RMMA. In dollars, Centennial generates $76.23 sales tax revenue per operation while RMMA generates only $26.28 sales tax revenue per operation. How is it that Centennial is so much more successful than RMMA? AEJ (Buena Vista) and CFO (Colorado Air and Space Port) even generate more sales tax revenue per operation that RMMA and these two airports do it with a fraction of the operations as RMMA has. Remind me -- why does Buena Vista have an airport? Oh, right! The 12 departures and arrivals that they average each day. 
| ||||||