Operating Budget Data - Maryland General...

JI.00Maryland Aviation Administration

Maryland Department of Transportation

Operating Budget Data($ in Thousands)

FY 00 FY 01 FY 02 % ChangeActual Working Allowance Change Prior Year

Special Fund $69,104 $76,802 $87,295 $10,493 13.7%

Federal Fund 211 261 211 (50) (19.2%)

Total Funds $69,314 $77,063 $87,505 $10,443 13.6%

! $1.8 million for information technology systems will aid business development and passengercommunications at Baltimore/Washington International Airport (BWI).

! $1.3 million reflects Maryland Transportation Authority (MdTA) police and security costs at BWI.

! $1.3 million is added for BWI’s Fire Rescue Department, including 26 new positions.

! $789,000 is included for the fiscal 2002 cost of 30 positions.

Paygo Budget Data($ in Thousands)

Fiscal 2000 Fiscal 2001 Fiscal 2002

Actual Legislativee Working Request Allowance

Special Fund $61,449 $92,829 $83,782 $97,953 $115,519

Federal Fund 11,817 10,419 12,033 23,522 40,968

Total $73,266 $103,248 $95,815 $121,475 $156,487

! The total fiscal 2002 capital program for the Maryland Aviation Administration (MAA) is $332.7million. Of this amount, $156.5 million is included in the fiscal 2002 allowance. The remaining$176.1 million is funded primarily by the MdTA and Maryland Economic Development Corporation.

! The fiscal 2002 allowance includes $251.2 million for the expansion of BWI.

! The fiscal 2002 allowance includes $4.4 million for improvements at Martin State Airport.

Personnel DataFY 00 FY 01 FY 02

JI.00 - MDOT - Maryland Aviation Administration

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Actual Working Allowance Change

Regular Positions 484.00 496.50 556.50 60.00

Contractual FTEs 1.50 9.50 2.00 (7.50)

Total Personnel 485.50 506.00 558.50 52.50

Vacancy Data: Regular

Budgeted Turnover: FY 02 27.71 4.98%

Positions Vacant as of 12/31/00 21.50 3.86%

! The operating program includes 56 new positions. Six of these positions represent contractualconversions. Twenty-six of the positions will support the fire rescue division at BWI.

! The capital program includes four new positions. Two of these positions represent contractualconversions.

Note: Numbers may to sum to total due to rounding.

Analysis in Brief

Issues

Business Trends for BWI: BWI’s revenue and expenditure trends, passenger and cargo volumes, andthe effect of consolidation of the airline industryare discussed. The Department of Legislative Services(DLS) recommends that the Maryland Aviation Administration (MAA) brief the committees onfuture trends for growth at BWI.

The Consolidated Transportation Program Provides over $251 Million for BWI Expansion Projectsduring Fiscal 2002: The Maryland Department of Transportation (MDOT) announced plans for a$1.3 billion capital expansion of BWI. The projects, costs, and financing risks are examined. DLSrecommends that MAA discuss its ability to sustain the level of debt introduced by the expansionprogram. DLS also recommends budget bill language requiring MAA to co-locate with MDOTheadquarters staff when the expansion program requires the existing Harry R. HughesTransportation Building to be demolished.

MAA Administrative Reorganization: MAA reorganized in August 2000 and created additional offices,divisions, and supervisory positions. MAA is also moving toward devolving budgetary control from acentralbudgeting systemwith two programs to 15 divisions. To aid legislative oversight and to providegreater clarification and accountability, DLS recommends that MAA work with the Departmentof Budget and Management to identify and create appropriate subprograms in preparation for thefiscal 2003 budget.


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Regional Aviation Airplane Was Not Sold After All: MAA requested funds for replacement of a30-year-old aircraft in fiscal 2001 and indicated that it would sell the old aircraft as it was becoming toocostly to maintain. MAA did not sell the aircraft, however, and the fiscal 2002 allowance includes$35,094 for maintenance of the old aircraft. DLS recommends that the fiscal 2002 allowance bereduced by $35,094 and that the committees adopt budget bill language instructing theadministration to sell the old aircraft in fiscal 2002.

Operating Budget Recommended Actions

Funds Positions

1. Add budget bill language requiring the Maryland AviationAdministration to co-locate with the Maryland Department ofTransportation headquarters when it is moved in January 2003.

2. Reduce consultant fees for cargo development. $ 120,000

3. Reduce advertising, printing, out-of-state travel, and vehicle andequipment replacement expenses to constrain State spending.

775,000

4. Reduce funds to increase turnover on 16 new positions to thetraditional 25%.

152,125

5. Delete four firefighter positions. 193,872 4.0

6. Reduce funds for consultant services and new equipment forinformation technology.

203,000

7. Delete funds for expenses associated with the old MarylandAviation Administration aircraft that was replaced during fiscal2001.

35,094

8. Add budget bill language requiring the Maryland AviationAdministration to sell the 1968 Piper Cherokee 235 aircraft.

9. Delete six new positions from the fiscal 2002 allowance. 120,195 6.0

Total Reductions $ 1,599,286 10.0


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PAYGO Capital Budget Recommended Actions

Funds Positions

1. Reduce out-of-state travel expenses. $ 15,000

2. Reduce funds for additional snow removal equipment. 622,000

Total Reductions $ 637,000

Updates

Regional Air Service Development Program Status: MAA developed a Request for Proposal (RFP) forproviding regional air service between BWI and Cumberland Regional Airport and Hagerstown RegionalAirport. The RFP requires that a contract be executed by June 15, 2001, and that air service commenceby December 31, 2001.

JI.00Maryland Aviation Administration

Maryland Department of Transportation

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Budget Analysis

Program Description

The Maryland Aviation Administration (MAA) has responsibility for fostering, developing, andregulating aviation activity throughout the State and for operating, maintaining, and developing the State-owned Baltimore/Washington International Airport (BWI) and Martin State Airport (MTN).

Governor’s Proposed Operating Budget

The fiscal2002 allowance increases by$10.4 million, or 13.6%. Exhibit 1 provides the major changesin the budget.

Personnel Changes

The operating allowance includes 56 new positions for a fiscal 2002 impact of $1.8 million. Theallowance includes six contractual conversions which are budgeted at a 5% turnover rate. Many of thenew positions provide for either 0% turnover or 50% turnover. When the cost of these new positions isannualized, the fiscal 2003 impact of the new positions will be approximately $2.4 million. This does notinclude increments or cost-of-living adjustments. A list of new positions and contractual conversions isincluded as Appendix 5.

Fire Rescue Service Improvements

In August 2000 MAA received a consultant study of the fire rescue department at BWI. The studynoted deficiencies in ambulance response times, training, and staffing levels. Several of the consultants'43 recommendations are included in the fiscal 2002 allowance.

The fiscal 2002 operating allowance provides funds for 20 firefighter positions, three supervisorypositions, two contractual conversions of administrative positions, and one mechanic dedicated to the firerescue service. Specifically the allowance includes:

! eight new fire fighter positions to increase the staffing from one person to two persons on two aircraftrescue and firefighting (ARFF) crash vehicles;

! eight new firefighter positions to increase the staffing from two persons to four persons on the heavy-duty rescue vehicles; and

! four new firefighter positions to establish a 1.25 staffing ratio to allow for sick leave, vacations, andholidays, and to reduce overtime expenses.


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Exhibit 1

Governor's Proposed BudgetMaryland Aviation Administration

($ in Thousands)

How Much It Grows:SpecialFund

FederalFund Total

2001 Working Appropriation $76,802 $261 $77,063

2002 Governor's Allowance 87,295 211 87,505

Amount Change $10,493 ($50) $10,443

Percent Change 13.7% (19.2%) 13.6%

Where It Goes:

Personnel Expenses (Excluding New Positions)

Fiscal 2002 general salary increase, increments, and fiscal 2001 increase phase-in . . . . $862

Other fringe benefit adjustments, including implementation of Law Enforcement OfficersPension System (LEOPS), Chapter 395, Acts of 2000 . . . . . . . . . . . . . . . . . . . . . . . . . 628

Turnover adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 565

Employee and retiree health insurance, retirement contribution, and workers' compensationpremium assessment rate change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 87

Programmatic Changes -- BWI Operations

Increase in Maryland Transportation Authority (MdTA) police and private contractorsecurity costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,248

Five maintenance technicians, replacement maintenance and safety equipment, and fourairport management officer positions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 459

Increased janitorial and cleaning contractual services, housekeeping supplies, and twohousekeeping supervisor positions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 418

Security enhancements including expanded ID badge system, office clerk and airportsecurity management position, and new equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . 116

Programmatic Changes -- BWI Fire Rescue

24 new positions including 20 firefighter trainees, two fire captains, one Division Fire Chieffor training, and one mechanic . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 996

Additional supplies and equipment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 290

Other General Increases

Six contractual conversions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237

Martin State Airport -- equipment and facility upgrades; new fixed-base operationsaccounting system, and one plumber position . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 217

Four administrative positions and one assistant attorney general position . . . . . . . . . . . 104


Where It Goes:

7

Regional Aviation -- increased cost and additional equipment for new aircraft, overhaul ofold aircraft, one replacement minivan, and new aeronautical charts . . . . . . . . . . . . . . . . 87


Where It Goes:

8

Other General Increases (Cont.)

Increased expenditures for development of 14 information technology systems includingcommon use terminal equipment, lease management, parking revenue control, garagevacancy indicators, and automated parking ticket . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1,366

Increased international, domestic, and regional advertising and printing activities; funds forair service consultants; and one air service development manager position . . . . . . . . . . . 785

New carpeting and paint for BWI terminal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 684

Five computer network specialist positions and additional office automation equipmentincluding personal computers, servers, and peripherals . . . . . . . . . . . . . . . . . . . . . . . . . 641

Increase in Certificates of Participation payments for Pier A&B expansion and deicingfacility due to revised amortization schedule . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 362

Cargo development enhancements including one position and furniture; cargo developmentconsultant; promotional events and advertising; and reprinting cargo directory . . . . . . . 311

Commercial Management -- continuation of negotiations for airline and concessionairecontracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 80

Other Changes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (100)

Total $10,443

Note: Numbers may not sum to total due to rounding.

The study noted that one of the primary responsibilities for BWI’s firefighters is emergency medicalresponse and as a result the new firefighter positions will be cross-trained as paramedics. In calendar 2000the BWI fire rescue squads responded to a total of 2,467 calls, of which 1,969 requested assistance at theBWI terminal building.

A second paramedic crew was added in fiscal 2001 and MAA indicates that an additional ambulancewill be purchased in fiscal 2002. In addition, the capital program also includes $580,000 for the purchaseof a new aerial platformladder truck. The fiscal2002 allowance also includes $300,000 for planning costsassociated with constructing a fire station near the existing terminal.

Performance Analysis: Managing for Results

MAA has significantly revised its Managing for Results (MFR) submission since the 2000 legislativesession. Specifically, the administration has added three new goals: to operate State-owned airports assuccessful business enterprises; to integrate safety enhancements and security into Maryland’s aviationsystem; and to develop an organization that attracts and retains a highly motivated workforce. Severalnew objectives and performance measures have also been developed in support of each of MAA’s statedgoals. It is evident that considerable work has been done to make the document a reflection of the valuesand activities MAA pursues each day. Exhibit 2 provides MFR data for MAA.


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Exhibit 2

Program Measurement DataMaryland Aviation Administration

Fiscal 1998 through 2002

Actual1998

Actual1999

Est.2000

Actual2000

Est.2001

Est.2002

Goal 1 -- Operate Maryland's State-owned airports as successful business enterprises that are cost-effective andefficiently serve the air transportation needs of its customers.

Airline cost per enplanedpassenger * $4.12 * $3.87 $3.98 $3.95

Airport revenue per enplanedpassenger * $13.35 * $13.48 $14.27 $14.46

Operating Ratio * 57.56% * 55.39% 56.76% 58.15%

Annual growth in enplanements * 7.42% * 15.16% 7.20% 5.40%

Goal 2 -- Serve the air transportation needs of our customers with state-of-the-art, convenient, customer-friendlyservices and facilities.

Terminal access time (inminutes) from parking facilities * n/a * 10.6 10.9 10.5

Cargo pounds (thousands) * 496,460 * 503,640 523,390 599,210

Goal 3 -- Integrate safety enhancements and security considerations into all facets of Maryland's aviation system

Compliance with annual FAASecurity Inspection Pass Pass Pass Pass Pass Pass

Compliance with annual FAAairport certification Pass Pass Pass Pass Pass Pass

The number of work-relatedinjuries involving lost time * 5 * 7 4 4

Average response time ofEmergency Medical Services(EMS) at BWI * 6:06 * 5:57 5:45 5:45

Average response of fire fightingequipment and personnel at BWI * 7:56 * 7:02 6:50 6:50

Goal 4 -- Operate in an environmentally proactive manner.

Number of incompatible housingunits * 879 * 771 726 676

Total percentage of employeestrained * * * * 76% 85%

Goal 5 -- Contribute to the economic well being of Maryland.

Total passengers at BWI 15,004,000 17,438,663 19,395,000 * 20,472,000 21,549,000

Rate of growth of Origin andDestination passengers * 11.2% * 10.5% 6.5% 6.5%

Jobs resulting from activities atBWI 74,543 75,765 77,008 77,008 78,270 79,532


Actual1998

Actual1999

Est.2000

Actual2000

Est.2001

Est.2002

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Jobs resulting from activities atMTN 1,139 1,158 1,176 1,176 1,196 1,216

Increase in percentage of cargoactivity * Base * 1.5% 6.6% 20.7%

Number of operating Marylandpublic use airports * 36 * 36 36 36

Goal 6 -- Develop an organization that fosters opportunities to attract, develop, and retain a highly motivatedworkforce.

Average annual vacancy rate * 9% * 8% 6% 5%

Average annual turnover rate * 5% * 5% 5% 5%

*New measures for which performance data are not available.

Source: Maryland Aviation Administration

MAA maintains that, given the nature of the aviation industry, it is unable to have control over specificaspects of airport operations. For instance, the majority of BWI’s 10,000 employees are not MAAemployees and as a result it would be difficult for MAA to have a customer service goal. MAA does haveconsiderable control, however, over other factors such as the safety of airport tenants and patrons. Asa result, MAA includes a safety and security goal in its MFR. In addition, many of MAA’s goals arereflected in construction projects or ongoing programs included in MAA’s capital program, such asincreasing the level of cargo activity or reducing the number of incompatible housing units.

Strategic Plan and Its Relationship to the MAA’s MFR

The 2000 Joint Chairmen’s Report requested that MAA develop and submit a strategic plan. Thecommittees were concerned that an organization with approximately 450 employees and annualappropriations of over $100 million did not have a document that guided its internal and externaldecisions.

MAA submitted its strategic plan in October 2000. The Department of Legislative Services (DLS)has the following concerns:

! Strategic Plan Is Reactive Rather Than Proactive: During the 2000 legislative session, MAAindicated that its strategic plan would be based on the results of a capacity study available in thesummer of 2000. However, MAA later indicated that this study wouldn’t be completed until thespring of 2001, leaving it unclear what data the administration used to develop its plan. In addition,two months prior to submitting the strategic plan to the budget committees, the Maryland Departmentof Transportation (MDOT) announced over $1.3 billion in new spending for capital infrastructure atBWI. It is difficult to understand the impetus for that announcement without the guidance that astrategic planning document would provide during the development of the capital program.


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! Strategic Plan Is Poorly Organized: The plan identifies many ideas as to the various goals, issues,and strategies that affect MAA. However, that there is too much information provided in thedocument and it is not well organized. The strategic plan does not clearly identify the businessopportunities MAA intends to pursue, what types or levels of cargo and passenger air service itintends to develop, or the steps it will take to pursue each of its goals.

! Linkages between Strategic Plan and MFR Document Are Unclear: It is difficult to pair the goalsand objectives outlined in the administration’s MFR submission with those in the strategic plan. Thegoals included in the strategic plan are never clearly identified and when a list of goals is provided, itis provided at the back of the document rather than in the beginning. The MFR should complementan organization’s strategic planning process.

In short, the strategic plan submitted by MAA is a good start toward developing the basic goals andvalues that should guide the organization. MAA should continue to work toward narrowing the focusof the strategic plan, including its goals, to those areas that MAA has the most influence, support thebeliefs that those activities are the most appropriate with data, and work to bring additional clarificationto the document.

DLS recommends that MAA discuss its plans to develop additional goals and continue to collectdata to support its MFR submission. In addition, MAA should discuss its plans to continuedevelopment of its strategic plan to make it a better reflection of the administration’s values andfuture plans. Most importantly, MAA should discuss how its BWI expansion plan was developedand justified absent a strategic plan.


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MAA PAYGO Capital Program

Program Description

The MAA capital program provides for the development and maintenance of facilities at BWI andMTN. The administration undertakes projects that meet the demands of commercial and general aviationfor both passenger and cargo activities at BWI. At MTN, facilities improvements and rehabilitationactivities such as runway and taxiway improvements, building and system renovations, and variousmaintenance projects are implemented. The administrationuses passenger facilitycharges(PFCs) assessedon enplaning passengers per flight segment to fund certain projects at BWI. Bonds backed by the PFCswere sold by the MdTA, and PFC revenue flows to the authority to pay debt service.

MAA Consolidated Transportation Program Changes

The fiscal 2001 through 2006 Consolidated Transportation Program (CTP) provides an increase of$765 million over the six-year program period. The majority of this increase relates to projects plannedfor the expansion of BWI. Specific highlights of the 2001 CTP include:

! BWI Expansion Program: The 2001 CTP includes $859 million for the BWI expansion project,announced in August 2000. Specific details of the projects included in the expansion program as wellas the financing mechanisms for each of the projects are included in the sections that follow.

! Four New Projects Added to the CTP: Another increase in the 2001 CTP requires $30 million forthe purchase of 90 shuttle buses for use at BWI facilities including the consolidated rental car facility(opening in May 2003), public and tenant parking lots, and the BWI Rail Station. Other new projectsinclude: $14.5 million for the installation of 27 bi-directional moving sidewalks throughout the BWIterminal building; $2.8 million for a remote aircraft parking pad; and planning funds totaling $300,000for an additional fire station at BWI.

! Total Funding of $4.4 Million for Improvements at MTN: Funds for improvements to the runwayat MTN increase by $3.6 million over the fiscal 2001 working appropriation. This includes $2.3million in federal funds from the U.S. Department of Defense through the Maryland Air NationalGuard for a runway lengthening project.

! Change in Scope: The scope of one project changed during fiscal 2001. The second phase ofdevelopment of the Midfield Cargo Complex was advanced from fiscal 2002 to 2001. MAA pavescargo support areas for additional vehicle parking while permanent vehicle parking facilities aredesigned and constructed. When the space is no longer necessary for vehicle parking, MAA indicatesthat it will continue to build out the Midfield Cargo Complex.


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Large Portion of 2001 CTP Supported by Non-TTF Revenues

The portion of projects included in the 2001 CTP funded by other, non-Transportation Trust Fund(TTF) types of funding, has grown from $9.3 million in the fiscal 2001 legislative appropriation to$176.1 million in the fiscal 2002 allowance. The fiscal 2002 allowance also includes a wider variety offund sources. Exhibit 3 outlines the increased usage of non-TTF types of financing.

In fiscal 2001 only two types of funds, other than TTF proceeds, were used to finance transportationprojects. Fiscal 2001 includes $7 million in certificates of participation (COPs) for the construction ofConcourse B and $564,000 in federal funds from the U.S. Department of Defense (DoD) for runwayimprovements at MTN. Primarily, MAA has used PFCs to back revenue bonds sold by the MdTA forlarger projects. The $176.1 million in fiscal 2002 is by far the largest in recent history. The majority ofthe other funds, $167.8 million, supports projects included in the BWI expansion program. Theremainder, $8 million, includes funds for improvements at MTN, as well as other projects not includedin the BWI expansion.

Exhibit 3

Maryland Aviation AdministrationCapital Projects Funded with Non-TTF Revenues

2001 CTP($ in Thousands)

Project Other Source

2001 CTPOtherFunds

TotalProjectCost*

BWI

Concourse A Expansion** Existing COPs/ MEDCO $43,816 $175,464

Parallel Taxiway and Parking Ramp** PFCs 5,594 53,324

Terminal Entrance and Roadway -- Phase I** MdTA (PFCs/Revenue Bonds) 9,311 49,790

Terminal Entrance and Roadway -- Phase II** MdTA (PFCs/Revenue Bonds) 27,744 172,021

Elm Road Surface Lot and Parking Structure** MdTA (Revenue Bonds) 31,666 190,150

Consolidated Rental Car Facility** MdTA (CFCs) 32,487 130,740

Central Utility Plant** MdTA (Revenue Bonds) 17,193 28,087

Remote Aircraft Parking** MdTA (PFCs)/FF 700 2,804

Moving Sidewalks** MdTA (PFCs)/MEDCO 4,341 14,458

International Terminal Common Use TerminalEquipment

PFCs 1,015 2,500

Martin State Airport Runway Obstruction DoD 2,255 7,083

Total $176,122 $826,421* Total project cost includes TTF and federal funds.**Projects are included in the BWI Expansion Program, see Issue 2.Source: Department of Legislative Services


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6193 84

116

176

1012

12

4122

923

0

50

100

150

200

250

300

350

Fiscal 2000 ActualExpenditures

Fiscal 2001 LegislativeAppropriation

Fiscal 2001 WorkingAppropriation

Fiscal 2002 Allowance

Fiscal Years

($in

Mil

lion

s)

Special Funds Federal Funds Other Funds

Fiscal 2001 and 2002 Cash Flow Analysis

The fiscal 2002 MAA capital program increased by $214 million, or 179.8%, over the fiscal 2001working appropriation. The fiscal 2001 working appropriation increased $3.8 million to $119 million,when compared to the 2001 legislative appropriation. Minor projects and system preservation increaseby $3.2 million over the fiscal 2001 working appropriation. Exhibit 4 demonstrates the magnitude of theaddition of new projects to the 2001 CTP and the usage of other funds to finance these projects.Appendix 6 lists the projects included in the 2001 CTP.

Exhibit 4

Fiscal 2000 to 2002 Cash Flow Changes

Source: Maryland Department of Transportation, 2001 Consolidated Transportation Program


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Issues

1. Business Trends for BWI

BWI provides facilities for air transportation and air cargo to the State of Maryland. In 1999, basedon the pace of growth and development, BWI ranked as the fastest growing airport in the nation.

Revenues and Expenditures

MAA generates revenues through charges on airport users, rental agreements for facilities, andconcessions at the airport. All operating revenues are deposited in the TTF. Revenues have been steadilygrowing at BWI in part due to the increase in passenger volume using airport facilities. Exhibit 5 presentsMAA's forecast for operating revenues and expenditures at BWI.

A portion of the revenues collected by MAA is governed by the Basic Use and Lease Agreements(BULA) between MAA and eight signatory airlines relating to leased space and other directly relatedactivities. MAA is currently renegotiating the existing BULA which expires February 2003. MAAexpects to complete BULA II negotiations by September 2002. The negotiations will develop a newagreement for the financial structure of the rates charged to the airlines and will most likely affect the levelof flight activity fees, rent and user charges, and concession fees that MAA collects from the airlines.

MAA generally is able to recover all operating expenditures through its revenues. However, whencapital expenditures are included, BWI's ability to be self-sustaining is limited. As seen in Exhibit 3, theagency relies heavily on the TTF for capital investments. The federal funds that MAA receives for useat BWI can only be used on capital enhancements to the airport. Beginning in late fiscal 2001, MAAexpects to begin collecting or devoting existing revenues to repayment of bonds issued by the MdTA forexpansion of BWI facilities. As a result, revenues such as PFCs, Customer Facility Charges (CFCs) andparking garage revenue will not be received by MAA but will cover the debt service of MdTA-issuedrevenue bonds. The expansion program and financing information are discussed in greater detail inIssue 2.


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Exhibit 5

Baltimore/Washington International AirportRevenues and Expenditures

Fiscal 1999 through 2005($ in Thousands)

FY 1999Actual

FY 2000Actual

FY 2001Estimated

FY 2002Estimated

FY 2003Estimated

FY 2004Estimated

FY 2005Estimated

Operating Revenues

Flight Activities $18,367 $22,975 $22,236 $23,067 $23,762 $24,360 $24,855

Rent/User Charges 22,420 22,948 27,868 27,740 27,879 28,409 28,892

Parking andConcessions* 60,830 75,600 73,943 64,083 89,301 96,616 98,994

Other 1,382 747 777 808 823 854 870

Subtotal $102,999 $122,270 $124,824 $115,698 $141,765 $150,239 $153,611

Federal Funds(Capital Only) 12,657 11,548 11,886 39,182 35,876 7,963 8,028

Total Revenues $115,656 $133,818 $136,710 $154,880 $177,641 $158,202 $161,639

Expenditures

Operating 57,712 64,026 72,823 83,017 89,311 95,953 103,725

Capital 51,556 71,167 86,748 150,000 109,496 44,787 39,789

Total Expenditures $109,268 $135,193 $159,571 $233,017 $198,807 $140,740 $143,514

* Fiscal 2002 parking revenues decline because a portion of existing garage parking revenue will shift from MAA to MdTAfor capital cost of new garage.Fiscal 2003 parking revenue increases due to new garage.Fiscal 2004 reflects annualization of parking garage revenue.



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Air Passenger Traffic Trends

BWI has seen significant increases in the volume of passenger traffic, in part due to the arrival of low-fare airlines. Between calendar 1990 and 2000, passenger use of BWI has grown at an average annualrate of 7.2%. MAA’s forecast shows total passenger traffic continuing to grow at an average annual rateof 3.4%, to an estimated 24.1 million total passengers in 2005. Exhibit 6 details MAA’s passengerforecast from calendar 1999 through 2005.

For the period 1999 through 2005, MAA predicts a gradual decline in the growth of passenger traffic.MAA advises that the growth in passenger traffic will remain positive, but will grow slower than previousyears due to the lack of unassigned gates. Until additional gates are constructed, airlines begin flyingwider bodied aircraft out of BWI, or airlines increase the number of flights per day using a gate, MAAexpects growth in passenger traffic to slow. DLS also suggests that growth in passenger traffic could beimpacted by the slowing of the economy, in which discretionary travel such as vacations would decrease.

Exhibit 6

BWI Passenger ForecastCalendar 1999 through 2005

(in Thousands)

CY 1999Actual

CY 2000Actual

CY 2001Estimated

CY 2002Estimated

CY 2003Estimated

CY 2004Estimated

CY 2005Estimated

Domestic 16,641 19,600 20,400 20,800 21,275 22,052 22,925

% ChangeDomestic n/a 17.8% 4.1% 2.0% 2.3% 3.8% 4.0%

International 797 835 885 935 1,177 1,245 1,202

% ChangeInternational n/a 4.8% 6.0% 5.6% 25.9% 5.8% (3.5)%

Total Passengers 17,438 20,435 21,285 21,735 22,452 23,297 24,127

% Change Total n/a 17.2% 4.2% 2.1% 3.3% 3.8% 3.6%


MAA should comment on why international air traffic is expected to outpace domesticpassenger growth. Specifically, they should address what new international carriers have beenadded, and at what capacity the international terminal is operating.


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43.7%44.0%

39.1%33.2% 30.3% 29.4%

32.1%34.2% 38.2%

37.7%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

70.0%

80.0%

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999

BWI Dulles National

Air Cargo Volume

Exhibit 7 shows that BWI’s market share of air freight over the past ten years has declined afterpeaking in calendar 1991. Growth in BWI’s market share of air freight since 1995 has not reached pasthighs but is gradually recovering from early 1990s losses. BWI competes directly with Dulles in air cargoand since Dulles is a major hub airport, it is difficult to predict BWI’s ability to continue to attract anincreasing share of the local air freight market.

MAA’s cargo forecast anticipates considerable growth, 8.5% per year in freight shipments in theperiod 2000 through 2005. It is not clear how likely this growth is, considering the overall share of themarket held by Dulles International Airport.

The fiscal 2002 allowance includes $311,000 and one air cargo development administrator, to marketthe midfield cargo complex. In addition, the capital allowance includes $775,000 for engineering andconstruction of phase 2 of the midfield cargo complex.

MAA should discuss the actions it intends to take to increase the volume of air cargo at BWIin light of BWI’s proximity to Dulles and the opening of the first phase of the midfield cargocomplex.

Exhibit 7

BWI Air Freight Market Share



19

Effect of Airline Industry Consolidation at BWI

During calendar 2000, several U.S. air carriers announced plans to merge or acquire other U.S.airlines. In particular, United Airlines (UA) announced its intention to acquire US Air, and AmericanAirlines parent company, AMR Corp, announced a buy out of TransWorld Airlines (TWA). The effectof these mergers could be significant to the State as each of the reported deals involves at least one airlinethat is currently providing air service at BWI. In addition UA, when it announced that it would be takingover US Airways, indicated that approximately 30 flights per day at BWI would be eliminated as a resultof the merger. Exhibit 8 lists the top ten air carriers at BWI by passenger volume for 2000.

Exhibit 8

Top Ten Airlines at BWICalendar 2000

Airline Passenger Volume Share of Total

Southwest 6,666,899 37.3%

US Airways 4,720,710 26.4%

United 1,264,354 7.1%

Delta 1,171,659 6.6%

Northwest 908,890 5.1%

American 799,235 4.5%

Continental 722,351 4.0%

America West 620,481 3.5%

TWA 553,147 3.1%

Piedmont 438,120 2.5%

Total 17,865,846 100.0%


The MAA provided specific information as to the loss of significant air service to BWI as part of theU.S. Department of Justice's antitrust investigation of the proposed acquisition of US Airways by UA.Due to the confidentiality requirements of the Justice Department's investigation, some specific detailscannot yet be released. However, the State has publicly stated that loss of air service and competitivechoice will have a negative impact on customers using BWI. Therefore, Maryland is opposing thisparticular acquisition. It is not anticipated that the proposed acquisition of TWA by American Airlineswill have a significant impact on BWI. As the chart above indicates, a combined TWA and AmericanAirlines would still represent a relatively small market share at BWI.

DLS recommends that MAA, to the extent that it is able, discuss the effect of consolidation inthe airline industry on air service and future growth at BWI.


20

2. The Consolidated Transportation Program Provides over $251 Million for BWIExpansion Projects during Fiscal 2002

In August 2000 MDOT announced plans for a $1.3 billion capital expansion program at BWI. Theplans call for increased spending in the short termfor additionalparking, terminal expansion, and improvedaccess to the terminal building. Exhibit 9 illustrates funding provided in fiscal 2001 and 2002. Duringfiscal 2002, $251 million will support the expansion efforts.

MDOT indicates that capital improvements are necessary at this time due to the increase in passengertraffic which has created an increased demand for airport services and facilities. While MDOT predictsthat the growth in passenger traffic will slow to approximately 4% each year, existing facilities, in somecases, are at capacity and require immediate attention.

Parking improvements account for 26% of the program, or approximately$379 million. Constructionof these facilities is scheduled to begin as early as February 2001 as the need for these facilities is mostcritical at this time. BWI also expects to expand the size of the current terminal building with $438 millionfor two new concourses and other related facilities. The largest share of the expansion program, 42%,or approximately$621 million, will improve passenger access to the terminal building, including improvedroads, pedestrian bridges between the terminal and the parking garage, and moving walkways.

One of the parking projects, Elm Road Surface Lot and Parking Garage, requires that the currentMDOT headquarters building located just north of the BWI terminal building be razed. MDOT estimatesthat MDOT staff will be relocated by June 2002. Phase 1 of the project will construct an area to thesoutheast of the building and phase 2 will require demolition. MDOT has not specified where it willrelocate and is evaluating leasing or constructing a new facility. MDOT has indicated that the new facilitywill be located in close proximity to the existing building.

DLS recommends the adoption of budget bill language requiring that when MDOT relocatesit should select a location that would also provide space for MAA staff. Currently MAA staff arelocated in at least three separate facilities incurring lease and other costs. In addition, the newbuilding should be located near mass transit facilities such as the Cromwell Light Rail stop, BWIrail station or bus stations.

, provided that it is the intent of the General Assembly that the Maryland Aviation Administration beco-located with the Maryland Department of Transportation (MDOT) when headquarters operationsare relocated due to construction at the Baltimore/Washington International Airport. In addition,MDOT should select a site that provides easy access to mass transit facilities such as light rail, heavyrail, or bus.


21

Exhibit 9

BWI Expansion Program ProjectsFiscal 2001 and 2002

($ in Thousands)

Project FY 2001 FY 2002

Parking ImprovementsElm Road Surface Lot and Elm Road Garage (includes $34 million for new MDOTHeadquarters Building) $1,998 $54,690Tenant Parking Lot 1,143 10,243Consolidated Rental Car Facility 12,146 33,191Expansion of Existing Parking Garage* 0 771

Terminal ExpansionConcourse A Expansion (Includes Taxiway and Ramp) 5,966 63,221Main Terminal Expansion (including new Concourse F and widening

Concourse D)* 3,340 7,558Central Utility Plant Upgrades 934 17,193Midfield Cargo Complex, Phase 2 6,705 775Moving Walkways and Escalators 619 3,722Remote Aircraft Parking 242 2,562

Terminal AccessTerminal Access Improvements, Phase 1 and Phase 2 13,332 55,738People Mover* 0 1,566

Total $46,425 $251,230

*includes only development and evaluation funds at this time.

Source: Maryland Department of Transportation

Financing for BWI Expansion projects

MAA has identified several financing options for the $1.5 billion capital expansion program currentlyunderway at BWI. Approximately $488 million of the funds for the expansion program will come fromMdTA bonds backed by various revenue sources. The Transportation Trust Fund will provide $135million. Proceeds from certificates of participation (COPs), federal Airport Improvement Program funds,and available PFC funds total $58 million. Financing for the remaining projects, $185 million for theexpansion/widening of the main terminal building and constructing Concourse F and $400 million for thepeople mover system, has yet to be determined. Appendix 7 provides more detailed information on thetype of financing MAA expects to employ.


22

Revenue Bonds Finance Majority of BWI Expansion

MAA intends to finance 8 of the 12 expansion projects with MdTA revenue bonds. The bondsproviding funds for the parking facilities, issued by the MdTA, will be leveraged with current and futureparking fees. MAA also expects to use bonds issued by the Maryland Economic DevelopmentCorporation totaling $172 million; $8 million of COPs proceeds; and FAA discretionary federal fundstotaling approximately $38 million, for construction of Concourse A, taxiway, and ramp. Lease paymentsfor the facility will be paid to MEDCO from MAA’s operating budget. Bonds for the consolidated rentalcar facility, also issued by the MdTA, would be financed with a $3.00 customer facility charge assessedfor each car rented per day.

House Bill 529 proposes to add a county rental car tax to all cars rented at BWI. The exact level ofthe tax is not known. However, proposals range from $1 to $2. If HB 529 is enacted, the county carrental tax added to the Consolidated Rental Car Facility fee of $3.00, the State’s existing rental car salestax of 11.5%, and the BWI concession fee would significantly increase the tax burden for car renters usingthe airport.

In the spring of 2000, the U.S. Congress authorized the FAA to increase the PFC from $3.00 to $4.50.This charge is assessed per enplaning passenger per flight segment. MAA advises that it intends to applyto the FAA for a PFC increase and will dedicate the additional funds to finance bonds for airfield andterminal access improvements. MAA expects to have the authority to begin collecting the full $4.50 PFCin January 2002. MAA began collecting PFCs in 1994 for several projects at BWI, and once those bondsare repaid, which is anticipated in September 2002, the full $4.50 PFC will be dedicated to repaying bondssold for airfield and terminal access improvements. Between January 2002 and October 2002, MAAintends to use the $1.50 difference in the PFC collected and the amount pledged to the 1994 bond serieson a cash basis for approved PFC-eligible projects.

The development plan is meant to address immediate needs at BWI over the next six years. MAAbases its assumptions about the level of funding that can be handled by the department on the belief thatthe program is manageable given the current state of the economy and other financial factors. Several ofthese projects assume that passenger traffic at BWI will continue to grow at the same rate (6.7%) that ithas grown since calendar 1999.

Questions remain, however, regarding MAA’s ability to fund the total cost of these projects. Futurerevenues such as parking garage fees and customer facility charges at the new car rental facility arepledged to repaying the capital costs of construction. If the economy slows or another external eventdecreases the volume of leisure travel or cars rented, MAA believes it has sufficient contingencies in placeto cover the debt service for these projects. With one or two projects financed in this manner, the risk ismanageable. With the volume of debt to be issued over the course of a short period of time, any changesin MAA’s assumptions about the level of repayment that can be handled in the future could have asignificant effect on MAA and MDOT’s ability to meet its other financial and programmatic obligations.


23

The heavy reliance on the use of revenue bonds, with the inherent risks, as well as possible industryconsolidation or other factors such as a slowing economy, should be examined as planning andconstruction moves forward. In addition, with so much uncertainty regarding the effect of the mergerson future levels of passenger traffic at BWI, caution should be taken with regard to issuing debt to bebacked by significant levels of future revenues. Further, financing details for over 40% of the totalproject has yet to be determined.

DLS recommends that MAA brief the committees on its ability to meet the financial obligationsset forth in MAA’s current capital program and the advisability of undertaking the proposed levelof debt.

3. MAA Administrative Reorganization

In August MDOT approved a reorganization plan for MAA aligning the activities of the administrationunder the Executive Director and two DeputyExecutive Directors: Airport Operations, and Developmentand Administration. The reorganization created 12 offices and at least 31 divisions within those officesand created several new positions including a Chief of Staff, an Assistant Deputy Executive Director forAirport Operations, and several Deputy Associate Administrator positions. While MAA noted that thereorganization was position-neutral, meaning that no new positions were necessary to carry out the neworganization, it should be noted that the fiscal 2002 allowance includes 60 new positions. MAA advisesthat these positions are primarily necessary due to growth at BWI and long-term deficiencies in staffingthe airport. MAA reallocated and reassigned existing positions within the administration to providemanagerial support and supervisory oversight of each of the newly created divisions subunits.

At the same time, MAA is moving toward devolving control from a central budgeting system with 2programs to 15 divisions. While the Office of Finance and Administration will retain oversight, the changewill require supervisors to be accountable for budgetary changes within their office or division. Giventhese changes, the increase in financial resources requested in the fiscal 2002 allowance, and the generalsize of the MAA, it is becoming increasingly difficult to understand the year to year variations andfunctional changes in MAA’s budget. This limits the ability to evaluate whether the administration isutilizing its resources effectively in a manner consistent with its MFR statement. To aid legislativeoversight and to provide greater clarification and accountability, DLS recommends that MAAwork with the Department of Budget and Management to identify and create appropriatesubprograms in preparation for the fiscal 2003 budget.

4. Regional Aviation Airplane Was Not Sold After All

The 2000 CTP included $350,000 in the minor projects program for the purchase of a replacementaircraft in fiscal 2001 for MAA’s Office of Regional Aviation. The existing aircraft, a 1968 PiperCherokee 235, was becoming too costly to continue to maintain. MAA advised in the fall of 1999 thatthey intended to sell the old aircraft, valued at approximately $70,000, once theyacquired the new aircraft.In April 2000 MAA acquired a new, six-seat, Cessna 206 aircraft.


24

The Governor’s fiscal 2002 budget allowance, however, does not include the revenue from the saleof the Piper Cherokee 235. Instead, the allowance includes $7,594 for insurance, gas, and oil, as well as$27,500 for an engine overhaul for the old aircraft. In addition, the old aircraft is stored in a hanger atMTN, which is owned by MAA, and therefore incurs no hanger rental charges. Hanger space is in highdemand at MTN and MAA should advise the committees as to why they feel it is justified to forgo rentcharges in favoring of retaining an old, repair-ridden aircraft.

DLS recommends that the fiscal 2002 allowance be reduced by $35,094 and adoption of thefollowing budget bill language instructing the administration to sell the old aircraft in fiscal 2002.

, provided that the Maryland Aviation Administration shall sell the 1968 Piper Cherokee 235 aircraftand reflect the revenues of this sale in the fiscal 2003 budget submission.


25

Operating Budget Recommended Actions

1. Add the following language:

, provided that it is the intent of the GeneralAssembly that the Maryland Aviation Administrationbe co-located with the Maryland Department of Transportation (MDOT) when headquartersoperations are relocated due to construction at the Baltimore/Washington International Airport.In addition, MDOT is advised to select a site that provides easy access to mass transit facilitiessuch as light rail, heavy rail, or bus.

Explanation: This language requires MDOT to select a location that would also provide spacefor the Maryland Aviation Administration (MAA) staff when MDOT relocates. Currently MAAstaff are located in at least three separate facilities incurring lease and other costs. In addition,the new building should be located near mass transit facilities such as the Cromwell Light Railstop, the Baltimore/Washington International Airport rail station, or bus stations.

AmountReduction

PositionReduction

2. Reduce consultant fees for a development of air cargovolume. The fiscal 2002 allowance provides funds forone full-time position to develop air cargo business atthe Baltimore/WashingtonInternationalAirport (BWI).In addition, the Maryland Aviation Administration hasleased the midfield cargo complex phase 1 to a cargoterminal operator who will be responsible fordeveloping cargo business for the midfield complex.Given the level of resources devoted to developing theexisting cargo space at BWI, consultant services arenot necessary.

$ 120,000 SF

3. Reduce advertising by $550,000, printing by $50,000,out-of-state travel by $100,000, and vehicle andequipment replacement by $75,000 to constrain thegrowth in State spending. The reduction provides forgrowth of at least 4% for each of these expenses.

775,000 SF

4. Reduce funds to increase turnover on 16 new positionsto the traditional 25%. For 16 new positions in the firerescue department, an incorrect turnover rate wasapplied. This reduction makes the correction for the 16positions recommended for funding.

152,125 SF


26

5. Delete four firefighter positions. The fiscal 2002allowance includes funds for 20 new firefighterpositions. This reduction provides the MarylandAviation Administration (MAA) with sufficientfirefighter coverage according to Federal AviationAdministration guidelines. MAA is instructed torequest funding for these positions in fiscal 2003.

193,872 SF 4.0

6. Delete funds for consultant services and new equipmentfor information technology (IT). The fiscal 2002allowance includes funds for six IT positions, wheninternal resources should be sufficient to meet theMaryland Aviation Administration’s (MAA) IT needs.In addition, existing computer equipment stocksshould be sufficient to meet the IT needs of MAA forfiscal 2002.

203,000 SF

7. Delete funds for expenses associated with the oldMaryland Aviation Administration (MAA) aircraft thatwas replaced during fiscal 2001. MAA advised thebudget committees that with the purchase of a newCessna 206 aircraft in fiscal 2001, it intended to sell theexisting 30-year-old aircraft as it was no longer feasibleto maintain. The fiscal 2002 allowance provides fundsfor gas and oil, an engine overhaul, and insurance forthe old aircraft. The fiscal 2002 allowance should bereduced and MAA should be advised to sell the oldaircraft.

35,094 SF

8. Add the following language:

, provided that the Maryland Aviation Administration shall sell the 1968 Piper Cherokee 235aircraft and reflect the revenues of the sale in the fiscal 2003 budget submission.

Explanation: The Maryland AviationAdministration (MAA) advised the budget committees thatthe purchase of a new $350,000 aircraft in fiscal 2001 would serve to replace a 30-year-oldaircraft no longer feasible to maintain. The fiscal 2002 allowance indicates that the aircraft hasnot been sold and that MAA intends to retain the aircraft at a cost of $35,094. Insofar as this iscontrary to MAA’s original indications, the fiscal 2002 allowance should be reduced and MAAshould be advised to sell the aircraft.


27

AmountReduction

PositionReduction

9. Delete six new positions from the fiscal 2002allowance, including two facilities maintenancetechnicians, one Assistant Attorney General, twohousekeeping supervisors, and one auditor. Existingresources within the administration should be sufficientto accomplish the work of these positions.

$ 120,195 SF 6.0

Total Special Fund Reductions $ 1,599,286 10.0


28

PAYGO Capital Budget Recommended Actions

AmountReduction

PositionReduction

1. Reduce out-of-state travel expenses. This reductionprovides for an increase in out-of-state travel of 25%over the fiscal 2000 working appropriation.

$ 15,000 SF

2. Reduce funds for additional snow removal equipmentby deleting funds for one snow blower and one snowplow. The fiscal 2002 allowance includes replacementand new purchases of five large pieces of snow removalequipment. Paired with existing snow removalequipment resources, this reduction would leavesufficient snow equipment given the level of snowtypically experienced at the Baltimore/WashingtonInternational Airport. It is unnecessary to undertake alarge equipment stock expansion at this time.

622,000 SF

Total Special Fund Reductions $ 637,000


29

Updates

1. Regional Air Service Development Program Status

Chapter 325, Acts of 2000 created the regional air service development pilot program within MAA.The administration is authorized to grant to any person the privilege of operating scheduled regional airservice to and from any community in the State that is determined by the MAA to be in need of, andcapable of, supporting such air service. If the MAA determines that financial assistance is warranted, itmay grant or loan funds to the person operating the air service. Grants associated with this service mustbe approved by the Board of Public Works (BPW). MAA is required to submit to the General Assemblya report on the initial results of the program by December 1, 2001. Additionally, the MAA is required tosubmit a report to the Governor and the General Assembly by December 1, 2002, that: (1) evaluates theeffectiveness of and the need for the Regional Air Service Development Program; (2) discusses thefeasibility of continuing regional service without a State subsidy; and (3) makes recommendationsregarding the continued financial support of the program.

MAA developed a Request for Proposal(RFP) after meeting with interested communities to determinetheir needs for regional air service. Through this process, MAA identified two regional airports at whichservice is desired: Greater Cumberland RegionalAirport and HagerstownRegionalAirport. Airlines wereto bid on providing scheduled air service three times per day between these airports and BWI. The RFPwas released on January 19, 2001, and responses were due by February 23, 2001. The RFP requires thata contract be executed by June 15, 2001, and that air service commence by December 31, 2001. If noviable proposals are generated by this process, MAA will re-evaluate, possibly change the scope of theprogram or the air service, and then rebid. Eight interested parties attended a pre-proposal meeting inJanuary 2001.

Due to FAA regulations, the fiscal 2001 and 2002 funds are budgeted in the BPW. No funds areprovided for the program in the MAA fiscal 2002 allowance.


30

Appendix 1

Current and Prior Year Operating BudgetsCurrent and Prior Year Operating Budgets

Maryland Aviation Administration($ in Thousands)

GeneralFund

SpecialFund

FederalFund

Reimb.Fund Total

Fiscal 2000

LegislativeAppropriation $0 $62,708 $0 $0 $62,708

DeficiencyAppropriation 0 0 0 0 0

BudgetAmendments 0 6,398 211 0 6,609

Reversions andCancellations 0 (2) 0 0 (2)

ActualExpenditures $0 $69,104 $211 $0 $69,314

Fiscal 2001

LegislativeAppropriation $0 $72,311 $261 $0 $72,572

BudgetAmendments 0 4,491 0 0 4,491

WorkingAppropriation $0 $76,802 $261 $0 $77,063



31

Major Changes in Current and Prior Year Appropriations

In fiscal 2000 the special fund appropriation increased by $6.4 million. Approximately $4.1 millionof this increase is attributable to the need for additional security, consultants, and janitorial services.Extreme weather events added $1.5 million. Personnel changes including deferred compensation costs,the new 16-step salary scale, and pay for performance added $1,027,800 to the fiscal 2001 legislativeappropriation.

In fiscal 2001 the special fund appropriation increased by $4.5 million to provide funds for increasedoperations at BWI. In particular, the increase provided funds for four paramedic positions approved bythe BPW ($87,269), additional safety and security measures ($1,183,153), airport development andcustomer service ($2,051,900) and fixed-base operation (FBO) fuel costs ($800,000) at Martin StateAirport. MAA justified the need for the additional funds primarily due to increased passenger trafficthrough BWI and unexpected federal mandates.

JI.00-MDOT-MarylandAviationAdministrationAppendix2

32

Object/F

undD

ifferenceR

eportM

DO

T-

Maryland

Aviation

Adm

inistration

FY

01F

Y00

Working

FY

02F

Y01

-F

Y02

Percent

Object/F

undA

ctualA

ppropriationA

llowance

Am

ountC

hangeC

hange

Positions

01R

egular435.00

442.50498.50

56.0012.7%

02C

ontractual1.50

7.501.50

(6.00)(80.0%

)

TotalP

ositions436.50

450.00500.00

50.0011.1%

Objects

01Salaries

andW

ages$

22,672,341$

22,704,221$

26,630,431$

3,926,21017.3%

02T

echnical&Spec

Fees1,306,239

1,598,1161,695,369

97,2536.1%

03C

omm

unication992,262

893,7731,150,727

256,95428.7%

04T

ravel377,305

243,632377,305

133,67354.9%

06Fuel&

Utilities

5,231,8875,742,332

5,934,212191,880

3.3%07

Motor

Vehicles

816,074907,628

1,078,764171,136

18.9%08

ContractualServices

28,043,12034,186,396

37,410,7153,224,319

9.4%09

Supplies&

Materials

3,894,5903,725,763

4,216,626490,863

13.2%10

Equip

-R

eplacement

325,688277,233

652,625375,392

135.4%11

Equip

-A

dditional332,963

55,658467,243

411,585739.5%

12G

rants,Subsidies,Contr

178,998369,000

374,0005,000

1.4%13

FixedC

harges1,439,331

4,159,1984,534,134

374,9369.0%

14L

and&

Structures3,703,349

2,199,8312,983,195

783,36435.6%

TotalO

bjects$

69,314,147$

77,062,781$

87,505,346$

10,442,56513.6%

Funds

03SpecialFund

$69,103,647

$76,802,281

$87,294,846

$10,492,565

13.7%05

FederalFund210,500

260,500210,500

(50,000)(19.2%

)

TotalF

unds$

69,314,147$

77,062,781$

87,505,346$

10,442,56513.6%

Note:Full-tim

eand

contractualpositionsand

salariesare

reflectedfor

operatingbudgetprogram

sonly.


33

FiscalSum

mary

MD

OT

-M

arylandA

viationA

dministration

FY

01F

Y01

FY

00L

egislativeW

orkingF

Y00

-F

Y01

FY

02F

Y01

-F

Y02

Unit/P

rogramA

ctualA

ppropriationA

ppropriation%

Change

Allow

ance%

Change

02A

irportOperations

$69,314,147

$72,571,409

$77,062,781

11.2%$

87,505,34613.6%

03A

irportFacilitiesand

CapitalE

quipment

73,265,343103,248,155

95,815,00030.8%

156,486,68363.3%

TotalE

xpenditures$

142,579,490$

175,819,564$

172,877,78121.3%

$243,992,029

41.1%

SpecialFund$

130,552,405$

165,140,064$

160,584,28123.0%

$202,813,529

26.3%FederalFund

12,027,08510,679,500

12,293,5002.2%

41,178,500235.0%

TotalA

ppropriations$

142,579,490$

175,819,564$

172,877,78121.3%

$243,992,029

41.1%


34

Appendix 4

Budget Amendments for Fiscal 2001Maryland Aviation AdministrationMaryland Department of Transportation

Status Amount Fund Description

Approved (1) $187,642 SF Operating Provides funding for the 4% cost- of-living adjustment (COLA) that wentinto effect November 15, 2000. The current appropriation funds the 2%COLA from January 1, 2001, through the end of the fiscal year. Thisamendment also funds the increased cost of salaries associated with theAnnual Salary Review (ASR) that was effective July 1, 2000, for certainclassifications related to attorneys as well as the ASR that takes effectJanuary 1, 2001, for certain fiscal and clerical classifications.

Pending (2) 4,303,730 SF Operating Provides funds for MAA Safety and Security ($1,183,613); AirportDevelopment ($1,020,000); Customer Service ($51,646); growthconsistent with annual passenger volume increases ($1,031,900); repairand maintenance of critical equipment, land and structures ($151,312);airport administration ($65,260); FBO aviation fuel to meet increaseddemand and energy inflation ($800,000); and additional contractualpositions to support growing capital program ($34,820).

34,820 SF Capital4,338,550

Projected (3)161,411

SF Operating Provide funding for the actual cost of the sick leave incentive programenacted in 2000.

Projected (4)694,000

SF Operating Increased funding for salary and wages due to lower-than-expectedturnover rate ($201,000) and increased overtime ($381,000). Also fundsa retroactive salary adjustment for air traffic controllers required byfederal regulations ($112,000).

Projected 1,991,500 SF Operating Provides funding for: (1) consultants ($150,000) to assist with impactassessment of airline mergers; (2) new finger print equipment ($160,000)to assist with compliance of new federal regulations; (3) additionalcommunication expenses ($59,500) due to additional use of high speeddata lines by customers and tenants; (4) additional medical, custodial,and parking lot lighting supplies based on passenger volumes ($142,000);(5) FBO fuel ($200,000) and terminal utilities ($1.1 million) based onincreased costs; and various emergency facility repairs ($180,000).

Projected (6) (9,081,975) SF Capital Adjusts the amended appropriation to agree with the anticipatedexpenditures for the current year as reflected in the fiscal 2000 through2006 Final CTP.

1,614,000 FF Capital(7,467,975)



35

Appendix 5

New Positions and Contractual Conversions

FY 2002

Classification FTET/ORate Full Cost

FY 2003Full Cost

New orConversion

Office of Finance and Administration

Internal Auditor I -- Revenues 1.0 50% $21,189 $40,277 new

Administrative Officer -- Budget Analyst 1.0 5% 38,134 38,134 conversion

Computer Network Specialist I -- TelecommunicationsSection

1.0 5% 45,019 45,019 conversion

Computer Network Specialist I -- TelecommunicationsProject Manager

1.0 50% 23,684 45,021 new

Computer Network Specialist I -- Webmaster 1.0 50% 23,684 45,021 new

Computer Network Specialist II -- Windows Administrator 1.0 50% 25,065 47,645 new

Personnel Administrator III -- Human Resources 1.0 50% 28,122 53,457 new

Computer Network Specialist I -- Database Administrator 1.0 50% 23,684 45,021 new

Executive Direction

Administrator II -- CargoDevelopment Foreign Trade Zone 1.0 50% 25,065 47,645 new

Assistant Attorney General VII 1.0 50% 35,628 67,727 new

Office of Marketing and Air Service Development

Administrator III -- Air Service Development Manager 1.0 50% 26,541 50,452 new

Office of Airport Operations

Airport Management Officer I -- Airport Operations Center 4.0 50% 94,736 180,084 new

Airport Management Assistant -- Terminal andTransportation Services

2.0 5% 68,524 68,524 conversion

Airport Management Specialist -- Security 1.0 50% 20,062 38,135 new

Facilities Maintenance Technician II 4.0 50% 61,772 117,416 new

Heavy Equipment Maintenance Technician I 1.0 50% 14,692 27,926 new

Administrative Assistant II -- Environmental Office andPublic Safety Office

1.0 50% 19,017 36,149 new

Housekeeping Supervisors IV 2.0 50% 32,492 61,762 new

Administrative Specialist III 1.0 50% 19,009 36,134 new


36

Appendix 5 (Cont.)

Classification

FY 2002

FTET/ORate Full Cost

FY 2003Full Cost

New orConversion

Computer Information Services Specialist II 1.0 50% 22,394 42,569 new

Office Clerk II -- Security 1.0 50% 15,461 29,389 new

Office of Airport Operations -- Fire Rescue

Airport Fire Division Chief -- Training 1.0 0% 64,632 61,400 new

Airport Fire Captain 2.0 0% 121,896 115,802 new

Airport Firefighter Trainee 12.0 0% 581,616 552,540 new

Airport Firefighter Trainee 8.0 50% 193,800 368,360 new

Airport Fire Lieutenant -- Civil Fire Inspector 1.0 5% 54,628 54,628 conversion

Administrative Assistant II 1.0 5% 30,880 30,880 conversion

Automotive Services Mechanic 1.0 0% 34,227 32,516 new

Martin State Airport

Skilled Trade Specialist II -- Plumber 1.0 50% 19,009 36,134 new

Operating Program Subtotal 56 1,784,662 2,417,770

Capital Program

Engineering Technician VI 1.0 5% 40,276 40,276 conversion

Airport Fire Lieutenant -- Civil Fire Inspector 1.0 5% 54,628 54,628 conversion

Fiscal Specialist -- Federal Ledger Accountant 1.0 50% 22,393 42,568 new

Administrative Assistant -- Planning 1.0 50% 15,461 29,389 new

Capital Program Subtotal 4 132,758 166,861

Total 60.0 $1,917,420 $2,584,631

Prepared by: Department of Legislative Services


37

Appendix 6

PAYGO Capital Program

Maryland Aviation AdministrationCapital Program($ in Thousands)

Fiscal 2002Allowance

TotalProject Cost

Baltimore/Washington International AirportNew Projects Added to the D&E and Construction ProgramsRemote Aircraft Parking $2,562 $2,804Installation of Moving Sidewalks and Escalators 3,722 14,458Purchase of New Bus Fleet for Shuttle Services 21,135 30,030New Terminal Fire Station 300 300Projects Moved from D&E to Construction Program15R Parallel Taxiway and Aircraft Parking Ramp 19,405 53,324Completed ProjectsRelocation of Ridgewood Mobile Home Park 0 10,996Runway 28 Remote Aircraft Parking/Deicing Ramp 0 12,323Concourse D Rehabilitation 178 17,516Concourse B Extension 215 48,360Midfield Cargo Complex -- Phase 1 0 20,443Ongoing ProjectsNoise Zone Programs 2,295 59,349Protective Land Acquisition 3,223 41,500BWI Environmental Analysis -- South Airport Land Use Plan 641 1,712BWI Expansion Projects* 251,230 1,465,740

Martin State AirportRunway 15/33 Obstruction Removal 2,255 7,083Runway 15/33 Reconstruction 1,887 9,774Midfield Complex, Infrastructure for Hangar Office Complex, Phase I 0 7,628New Projects Added to the D&E and Construction ProgramsPurchase of Hangar 0 1,415New Air Traffic Control Tower 0 350

Minor Project Changes 44,400 ongoingSalaries and Administrative Costs 4,900 ongoingTotal Changes** $332,659

*Details are included in Issue 2.**Fiscal 2002 total includes nonappropriated funds of $176.1 million


Source: Maryland Department of Transportation, 2001 Consolidated Transportation Program


38

$1.3B

illionB

WI

Expansion

Program

Financing

Options

($in

Millions)

Project

Est.

Cost

TT

FC

OP

s*

MdT

AB

ondsB

ackedby

Parking

Revenues

ME

DC

O

MdT

AB

ondsB

ackedby

CF

Cs

Federal-

AIP

MdT

AB

ondsB

ackedby

PF

Cs

PF

Cs

-P

AY

GO

TB

D

Parking

Elm

Road

SurfaceParking

Lotand

Garage

(includes$34

million

fornew

MD

OT

Headquarters

Building)

$190.2$39.4

$150.7

TenantParking

Lot

13.013.0

Consolidated

RentalC

arFacility

130.712.2

118.5

Expansion

ofE

xistingParking

Garage

45.03.3

41.7

Term

inalExpansion

Concourse

AE

xpansion(including

taxiways

andram

ps)228.8

7.8167.7

38.115.2

New

Concourse

F51.0

51.0

Widening

ofC

oncourseD

30.030.0

Main

Term

inalExpansion

100.014.2

85.8

CentralU

tilityPlan

Upgrades

28.16.0

22.0

Midfield

Cargo

Com

plex-

Phase2

10.010.0

Moving

Walkw

aysand

Escalators

14.44.5

9.9

Rem

oteA

ircraftParking2.8

0.72.1

Term

inalAccess

Term

inalA

ccessIm

provements:

Phase1

andPhase

2221.8

34.677.5

109.7

PeopleM

over400.0

2.0398.0

Total

$1,465.8$135.4

$7.8$250.2

$172.2$118.5

$40.2$119.6

$15.2$606.5

Notes:

*=

Fundsrem

ainingfrom

previousC

OPs

issuanceT

TF

=T

ransportationT

rustFundC

OPs

=C

ertificatesof

ParticipationM

ED

CO

=M

arylandE

conomic

Developm

entCorporation

CFC

=C

ustomer

FacilityC

harge

AIP

=A

irportImprovem

entProgramPFC

=Passenger

FacilityC

hargeT

BD

=T

oB

eD

etermined

$1.3B

illionB

WI

Expansion

Program

Financing

Options

Source:M

arylandD

epartmentof

Transportation;D

epartmentof

Legislative

Services

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