HIGHFILL -- Finance Committee members forwarded a 2018 budget to the full Northwest Arkansas Regional Airport board Friday.
The proposal foresees an estimated $29.1 million in expenses and $28.6 million in revenue. That compares with $19 million in expenses in this year's budget and $24.6 million in revenue.
The 2018 budget allows for $7 million for operations; $5.2 million for debt service; and $16.8 million in capital expenses. Revenue includes $18.4 million in operations; $10 million in capital and $118,000 in interest. Capital projects include finishing the parking deck, additional ground-level parking and substantial renovation of the terminal and terminal infrastructure.
"It's a pretty conservative budget. It's built around a 3 percent growth in enplanements, even though we are currently at a 4 percent growth in annual boardings," said Scott Van Laningham, CEO of the airport. "The flow of funds is tied very closely to our passenger levels."
Officials are also starting to budget for staff expansion, Van Laningham said.
"Early next year, we will add the director of planning, programming, construction, and engineering, and late next year we hope to add the position of chief operations officer," he said. "With all the construction projects we have going and scheduled, we need to start adding staff to manage the different projects and their different schedules."
The difference between revenue and expenses for 2018 represent the costs of paving what was once a gravel, overflow parking lot. The difference is expected to be made up using money from the airport's development fund.
"The biggest thing is the lowering of the airline rates and charges due to refinancing our debt last year," said Kelly Johnson, airport director. "This is a big drop, $550,000 in interest expense going away is a huge deal."
Airport officials last December refinanced existing airport debt. The refinancing requires the airport to lower the terminal rental rates, landing fees and some use fees.
"It gives the airlines lower operating costs but we can only charge them for what our expenses are and since the interest rate dropped on our bond issue, we can't charge them for something we aren't paying for," Johnson said.
Johnson said she wishes that would translate into lower fares for passengers but she does not expect that it will.
"I wish it would. There's no reason why it shouldn't, but it won't," Johnson said. "Airport costs to an airline equate to 2 to 6 percent of their operating budget."
NW News on 12/09/2017
Print Headline: XNA 2018 budget outlined