"New projects could drain Augusta, Georgia airport funds"

Thursday, September 26, 2002

New projects could drain airport funds
By Vicky Eckenrode 
The Augusta (GA) Chronicle

 
Because of increases in security costs, insurance rates and consultant
projects, the Augusta Aviation Commission will vote today on a number of
items that could eat up the airport's contingency budget for the rest of
the year.

Members of the board's finance committee, however, said they do not
expect to have to dip into Augusta Regional Airport's reserves to cover
expenses this year.

"We don't have any contingency (money) now, but pretty much the overall
budget's going to take care of itself," said Aviation Commissioner
Cedric Johnson, who is the chairman of the finance committee.

The airport budgeted $600,000 in its contingency funding this year. That
included $50,000 for marketing efforts for Continental Express as well
as expenses for planning the construction of a new terminal.

An unexpected expense came from the jump in the airport's liability
insurance. After the Sept. 11 attacks, insurance policies at commercial
airports nationwide increased.

Although the airport originally expected it to double and budgeted
accordingly, the actual premium will rise to nearly $169,000. The
finance committee will recommend to the full board to take about $74,000
to cover the difference.

Security costs have also come in over budget. The Federal Aviation
Administration and the airlines are helping pay for extra law
enforcement officers, but the airport needs an extra $160,000 to meet
security needs this year.

Two projects for the airport's business consulting firm, Black & Veatch,
are listed on the board's agenda for today. One of those projects
authorizes $70,000 to develop a disadvantaged business enterprise
program.

The work is eligible for 90 percent reimbursement from the FAA, so only
$7,000 would come from contingency funds.

The other task, to create a financial plan and develop rates and charges
for airlines, would cost $167,000 and would not be eligible for
reimbursement.

Some projects were approved by the full board last month, but they still
went back to the finance committee for approval and to identify a
funding source.

This is part of the airport board's new process, in which all
expenditures go through the finance committee in addition toairport
Director Ken Kraemer for recommendations before the boards signs off on
them.

The process was tightened after a disagreement at the board's July
meeting, in which aviation Commissioner Bernie Silverstein objected to
work orders being approved without the finance committee's input.

Augusta Regional's finance director, Leslie Carter, said the airport
should not have to dip into its savings or investment accounts.

Although the budget originally factored a $1.4 million deficit for the
year, Ms. Carter said revenues for fuel sales have been stronger than
expected after Sept. 11, 2001, and already have exceeded projections for
the year.


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