Annual Budget & Appropriations Ordinance

2013

ANNUAL BUDGET & APPROPRIATIONS ORDINANCE GREATER ROCKFORD AIRPORT AUTHORITY • FOR THE FISCAL YEAR OF 2013 • ROCKFORD, ILLINOIS

CHICAGO ROCKFORD INTERNATIONAL AIRPORT

Mission

The Chicago Rockford International Airport exists to create regional economic opportunities through global aviation.

Vision

We will leverage our asset base to achieve significant growth in the following areas:

Cargo Service – to increase national ranking in gross landed weight.

Passenger Aviation – to provide a high level of hassle‐free customer satisfaction with additional destinations in niche markets.

General and Corporate Aviation – to maintain, support and encourage expansion.

Economic Development – to provide economic opportunities for growth.

Education, Research and Development Initiatives – to leverage facility and available resources to enhance local aerospace initiatives in both the public and private sectors.

Table of Contents

TRANSMITTAL LETTER Budget Objectives ...... 1 Overview and Economic Conditions ...... 2 Budget Summary ...... 6 History ...... 6 Organization ...... 8 Strategic Plan ...... 11 Financial Policies ...... 14 Budget Document ...... 19 Budget Process ...... 19 Distinguished Budget Presentation Award ...... 20 Revenue ...... 22 Expenditures ...... 23 Debt Service ...... 25 Capital Improvement Program ...... 26 Net Assets ...... 28 Designated Assets ...... 28 Acknowledgement ...... 30

BUDGET SUMMARY Summary ...... 31

REVENUE OPERATING Summary ...... 32 Budget ...... 34 Justifications ...... 35

OPERATING EXPENSES Summary ...... 39 Combined Departmental Budgets...... 40 Finance and Administration Department Summary ...... 42 Budget ...... 45 Justifications ...... 46 Facilities and Maintenance Department Summary ...... 51 Budget ...... 53 Justifications ...... 55 Operations Department Summary ...... 61 Budget ...... 63 Justifications ...... 64 Marketing Department Summary ...... 67 Budget ...... 69

Justifications ...... 70

Terminal Service Department Summary ...... 73 Budget ...... 75 Justifications ...... 76

AirFest Department Summary ...... 79 Budget ...... 81 Justifications ...... 82 Cargo Development Department Summary ...... 86 Budget ...... 87 Justifications ...... 88 Passenger Development Department Summary ...... 90 Budget ...... 92 Justifications ...... 93

NON‐OPERATING REVENUES AND EXPENSES Budget ...... 96 Justifications ...... 97

CAPITAL IMPROVEMENT PROGRAM ...... 98

EXHIBITS Exhibit 1 Tentative Budget and Appropriation Ordinance ...... 107 Exhibit 2 Rate & Charges Ordinance ...... 109 Exhibit 3 Acronym and Glossary of Terms ...... 111 Exhibit 4 Statistics ...... 116 Exhibit 5 Fiscal Year 2013 Budget and Appropriation Ordinance ...... 122

July 27, 2012

The Honorable Chairman and Board of Commissioners Greater Rockford Airport Authority 60 Airport Drive Rockford, IL 61109

Dear Mr. Chairman and Commissioners:

Respectfully presented is the annual budget of the Greater Rockford Airport Authority (Authority) as approved by the Board of Commissioners July 26, 2012. The Authority operates the Chicago Rockfford International Airport (RFD).

The budget includes plans and resources to move toward the strategic goals, which were approveed in January by our Board of Commissioners with a new mission and vision to market RFD on many fronts. This includes continued efforts to grow passengers, promote the annual AirFest and gain recognition as one of the region’s premier events that allows us to showcase the many assets of RFD and make the RFD cargo capabilities known across the globe.

The capital budget includes funds for significant infrastructure upgrades to support the expansion and growth of aviation development. Continued efforts are being made with international cargo carriers and the related support networks. Passenger retention and development is also a key part of the FY2013 plan.

The budget strategically directs the allocation of resources to best enable the Authority to operate RFD in a manner that exceeds customer expectations and meets all safety and security requirements. It funds operations, activities, infrastructure, equipment and technology enhancements to meet the strategic goals of the Authority for the next year and into the future.

Budget Objectives

The Authority’s goals for the FYE13 budget are to allocate available resources to RFD programs and services to:  Operate a safe and secure airport.  Meet all regulatory, legal and contractual requirements.  Continue to exceed expectations to the customers of RFD with exceptional customer service and care.  Operate an efficient and financially self‐sustaining organization.  Provide the necessary resources to accomplish the Authority’s strategic plan.

The budget objectives are further broken down within each of the departmental and capital budgets for the year.

new p5.indd 1 4/17/13 8:35 AM

Overview and Economic Conditions

The Authority is one of the oldest airport authorities in the United States. Formed in 1946, subsequent to enabling legislation, the Authority has four communitiies who appoint a seven‐member Board of Commissioners. The Board of Commissioners is responsible for setting policies and ordinances governing the operations of the Authority, which are carried out or enforced by a professional staff.

We have unrestricted airspace and a seven day 24 hour FAA Air Traffic Control Tower. RFD is a world‐class airport capable of landing any aircraft in Category II/III conditions.

RFD is a United States Customs Port of Entry and grantee of Foreign Trrade Zone (FTZ) #176. The diverse activities at RFD cause it to have a greater economic impact on the region it serves than any other commercial service airport in the State of Illinois, excluding the City of Chicago's airport system.

RFD is located in the southwest quadrant of Rockford, Illinois with easy access from five major highways. It is located approximately 85 miles northwest of Chicago, Illinois; 90 miles southwest of Milwaukee, Wisconsin; 60 miles southwest of Madison, Wisconsin; 90 miles east of Dubuque, Iowa; and 90 miles northwest of Moline, Illinois. The airport covers an area of about 3,000 acres with 800 of those acres airfield related. The market service area ranges from 2,500,000 people aat 60 minutes to 8,400,000 people at 90 minutes. RFD is geographically centered within the region.

The economic condition and outlook for the region has improved slightly over the prior year. Employment needs are increasing slowly, but greater than the needs in the last two prior years and the unemployment rate decreased from 11.8% to 10.7%. The region continues to expand and diversify its industrial base and employment opportunities. The Metropolitan Stattistical Area (MSA) is over 350,000 people and is the fastest growing MSA in the state of Illinoiis and has beeen for two consecutive years. This growth is expected to continue. The region is a community that still understands shift work and values companies that need employees with industrial skills. A recent study by The Pathfinders (Dallas, TX) polled area employers on existing workforce characteristics, found that the labor‐shed actually consists of a five‐county region with a population of over 807,000 individuals and that the workforce was over 435,000 people. This number far exceeds the federal government’s aassumption of a two‐county MSA population of approximately 350,000 people and a labor force of about 175,000. The region’s low cost of living and competitive wage rates benefit both employer and employee.

Overview and Economic Conditions(con’t)

Our region is considered an excellent location for logistics services, warehouses and distribution centers, aerospace, on and off road vehicle manufacturing, industrial machinery, and metals manufacturing, as well as back office operations/call centers, professional business services, food processing, and chemicals manufacturing. The area lies in the heart of the Midwest at the crossroads of America and in very close proximity to Chicago, Milwaukee, Madison, Quad‐Cities, and Peoria. As part of the Greater Chicago region, Rockford is part of the third‐largest multi‐modal system in the world and the largest in the U.S. From the Rockford area, businesses can reach 80% of U.S. households within a 24‐hour truck drive.

The financial condition of the Authority is primarily dependent upon the amount of aircraft utilization at RFD. That utilization, in turn, is dependent upon several factors: the amount of cargo that is sorted at the United Parcel Service hub; the number of passenger airlines that service RFD; the number of passengers that use the airport; the national economy, which influences buying, and subsequent shipping habits; and, the regional economy that influences the willingness of the consumer to purchase air travel.

RFD is home to the second largest air hub sorting facility in United Parcel Service's system. Fees associated with cargo account for 35% of the operating revenue of the Authority.

The Authority is not immune to the global economic crisis and this year statistics and revenues reflect that impact. The most recent FAA cargo reports state RFD is the 25th largest cargo airport in the United States. The annual total of gross landed weight for all cargo aircraft for the year was down 1.99%. A majority of this was a reduction in flights for UPS during the years, which are all domestic flights. A number of the top 30 airports in the US saw an increase due to international cargo operations. Since all of our cargo operations are domestic, our strategic plan focuses on international cargo as a growth area. This will help mitigate some fluctuations.

Cargo is a leading economic indicator and we fully believe that as the economy begins to grow, so will our cargo activities. The new International Cargo apron and facility can allow RFD to compete globally and become one of the top cargo airports in the world. It is estimated that RFD creates an economic impact approximately $1 billion annually to the region. Feeding off the cargo airlines are 60 motor freight carriers serving 37 terminals. The goal of growth in international cargo at RFD is a paradigm shift for the movement of cargo in the Midwest region of the United States. FYE13 projects no increase in weights; however, an increase in rates will help offset the limited growth.

Overview and Economic Conditions(con’t)

Cargo Landed Weight

1,600

1,400 Millions

1,200

1,000

800 LBS

600

400

200

‐

Passenger growth continues to be a high priority as outlined in the strategic plan. As the volatility of the passenger airlines continues it is important for RFD to diversify the base of airlines that operate at RFD. Currently Allegiant Air offers service to Las Vegas, Orlando/Sanford, Clearwater/St Pete, and Phoenix/Mesa. Direct Air offers seasonal service to Punta Gorda/Ft. Meyers, FL. Apple Vacations offers seasonal service to Cancun and Punta Cana. Frontier Airlines began service in December with three flights weekly to Denver. Allegiant Air accounts for 70% of all seats currently available at RFD.

Our goal is to increase the number of passengers and airlines. Economic issues that are outside of our control can have an effect on this plan. These issues include: the current fuel price rise, the financial condition of the airlines, and any security and safety mandates issued. The Authority is mindful of these issues as they plan for the future. The last year has seen dramatic changes in our regional and global economic condition. The Authority is making every effort to continue to build and grow passenger service. Even though capacity has not returned to its previous levels, our average load factors are over 90%, so the demand is still there and the budget includes resources to continue marketing and developing the service. New service will begin in January to Montego Bay, Jamaica on a seasonal basis with Apple Vacations. With these additions, RFD is projecting a 10% growth in passengers for the coming year.

Overview and Economic Conditions(con’t)

Passengers 250,000

200,000

150,000

100,000

50,000

‐

The Foreign Trade Zone (FTZ) program creates a partnership between American business and the Federal government, increasing the global market share of U.S. businesses and retaining or creating jobs at home. The FTZ program fits the mission of the Authority to expand business opportunity, create jobs and assist local companies to compete more effectively in the global marketplace. We believe that the FTZ can be a catalyst to improve the economic and business climate of the region. Four of our sites/subzones are active Zone operators. In 2010, FTZ #176 received reorganization approval from the FTZ Board under the new Alternative Site Framework (ASF) system, which provides faster and cheaper access to program benefits for potential business partners in the first quarter of the fiscal year. Service is now readily available to prospects in all of Boone, Ogle, Lee, Stephenson, Winnebago as well as parts of Bureau, Kane and McHenry Counties, most of LaSalle and part of Putnam County. While the growth in movement of products through FTZ activated sites and subzones slowed in the recessionary economy (now just over $200 million for the year ending Sept 30, 2010), leadership expects growth to reach $500 million within the next few years. Interest in activation is growing, with 1‐2 additional applications anticipated during FYE13, with many more partners in the next two to three years.

Budget Summary

The budget presented has many highlights discussed in subsequent sections. Operating revenues is budgeted at $5,440,277 for FYE13, is an increase from the prior year budget mainly related to the additional of a new planned lease agreement. Operating expenses are budgeted at $9,434,087 which is a .4% increase compared to the prior year budget due to personnel service costs.

Est. FYE12 FYE10 FYE11 BFYE12 Est. FYE12 BFYE13 vs BFYE13 Operating Revenue Airport fees‐airside $ 2,195,271 $ 2,141,149 $ 2,248,215 $ 1,967,889 $ 2,192,040 11.4% Airport fees‐landside ‐ rental car commissions 128,145 166,014 170,000 182,268 200,000 9.7% Lease revenue‐on airport 1,083,870 1,065,598 1,093,239 1,093,736 950,634 ‐13.1% Lease revenue‐off airport 463,926 498,751 488,552 498,751 690,730 38.5% Airfest revenue 668,069 613,582 612,500 495,962 606,700 22.3% Airport service fees 390,450 234,410 390,130 262,580 357,200 36.0% Other 697,015 526,964 451,294 452,140 442,974 ‐2.0% Total Operating Revenue 5,626,745 5,246,468 5,453,930 4,953,326 5,440,277 9.8%

Operating Expense Personnel services (3,545,038) (3,871,753) (3,761,645) (3,606,203) (3,910,384) 8.4% Contractual services (3,623,679) (3,662,078) (3,884,551) (4,349,188) (3,987,416) ‐8.3% Commodities (1,010,928) (1,172,744) (1,210,121) (935,767) (1,277,447) 36.5% Other (381,338) (404,966) (253,240) (502,226) (258,840) ‐48.5% Total Operating Expense (8,560,984) (9,111,541) (9,109,557) (9,393,383) (9,434,087) 0.4%

Net Operating Expense (2,934,238) (3,865,073) (3,655,628) (4,440,056) (3,993,810) ‐10.1%

Non‐operating Revenue (Expense) Annexation agreement 139,906 ‐ ‐ ‐ ‐ Interest income 127,896 89,321 90,000 33,880 45,000 32.8% Property tax levy‐operating 3,237,125 3,277,669 3,274,000 3,346,076 3,297,300 ‐1.5% Replacement tax 523,707 582,125 580,000 525,140 517,000 ‐1.6% AIP reimbursement funds 2,926,027 2,248,144 1,489,429 2,227,434 1,456,024 ‐34.6% Passenger facility charges 341,985 356,332 500,460 522,905 473,247 Funds from auctioned equipment 1,901 ‐ 5,000 ‐ 20,000 Other credits 26,299 ‐ ‐ 145,279 ‐ 0.0% Interest expense (204,207) (222,750) (212,000) (144,047) (161,706) 12.3% Total Non‐operating Revenue (Expense) 7,120,638 6,330,840 5,726,889 6,656,667 5,646,865 ‐15.2%

Debt Service, Sinking Fund Deposits & Other Uses Debt service principal payments (3,025,600) (808,400) (266,900) (266,900) (402,094) 50.7% Debt Service ‐ ‐ ‐ ‐ 5,500,000 Sinking fund deposits/uses ‐ ‐ 70,000 ‐ ‐ 0.0% Total Debt Service and Sinking Fund Deposits (3,025,600) (808,400) (196,900) (266,900) 5,097,906 ‐2010.0%

Capital Improvement Program Airside projects (591,735) (720,380) (341,771) (5,215,736) (540,136) ‐89.6% Landside projects ‐ (35,652) (121,500) (53,335) (3,700,000) 100.0% Terminal projects (1,140,263) ‐ (94,000) (111,806) (871,000) 100.0% Administration projects (76,500) Maintenance projects (306,800) Operations projects (464,474) (198,057) (316,210) (263,174) (93,700) ‐64.4% Total Capital Improvements (2,196,472) (954,089) (873,481) (5,644,051) (5,588,136) ‐1.0%

Excess Funds $ (1,035,672) $ 703,278 $ 1,000,880 $ (3,694,340) $ 1,162,825 ‐131.5%

History

Camp Grant In 1917, during World War I, RFD, then named “Camp Grant,” was a U.S. Army Calvary Camp. During World War II the Army transformed Camp Grant into a military training base and a prisoner of war detainment camp.

In 1946, the State of Illinois adopted the Airport Authorities Act; thus, the Greater Rockford Airport Authority was created. The original Board of Commissioners requested and received a grant of 1,500 acres of federal land. The airfield was constructed using most of the military base infrastructure. Over the last 50 years, RFD has hosted numerous airlines including: Braniff, Ozark, Frontier, Midwest Express, TWA, American, Northwest, TransMeridian, Hooters Air, Sunship1 and United. Airlines currently serving RFD include Allegiant, Direct Air and Apple Vacations.

RFD’s Terminal In 1987, a new terminal building was constructed to better meet the community’s passenger travel needs. Within the last few years, significant terminal internal reconstruction and reconfiguration projects have been completed to accommodate the many new passengers and to meet Transportation Security Administration requirements. The terminal is now at full build out and considering peak flow can accommodate up to 500,000 passengers.

UPS In 1994, United Parcel Service constructed an air cargo distribution hub. The hub currently employs approximately 1,200 with an average of 22 daily‐scheduled cargo jet arrivals/departures ranging in size from 727‐100s to 747s. In 2006 UPS built a 70,000 square foot building for their new heavy freight business which began in the summer of 2006. This was the first building completed in the UPS network for the new heavy freight business. During fiscal year 2007, UPS completed $25 million dollars’ worth of redesign to the package handlers’ distribution hub to increase capacity. As a result, output increased by over 100%.

Infrastructure Within the last several years, millions of federal dollars have been invested in airport infrastructure improvements. There are two runways: one is 8,200 feet in length; the longest is 10,000 feet in length. The 10,000 foot runway has a Category II/III Landing System, which is a valuable landing aid for commercial and private pilots. The current year budget includes the first phase of a multi‐year project or rebuild of the north/south runway 1/19, which shows the airports commitment to maintaining a world‐ class facility for the flying public. The coming begins the first phase of a multiple phase project to rebuild runway 1/19.

In 1996, a two million‐gallon fuel storage facility funded by United Parcel Service, along with a perimeter roadway system, was constructed. The storage facility increases the stability of the airport now that fuel is immediately available. This storage facility is directly linked to an underground pipeline that ships all jet fuel necessary. There are future plans to expand the underground pipeline asset.

Foreign Trade Zone #176 In July 1998, RFD became a User Fee Airport which brought Customs service to Rockford on a fee‐for‐ service basis. On March 1, 1991, the FTZ Board in Washington, DC granted authority for FTZ #176 Site #1 (1972 acres) which encompassed the airport itself and some surrounding industrial properties. Port status was granted effective September 13, 1995, transferring the cost of the Customs operation to the

History(con’t)

federal government. RFD was the first User Fee Airport to be upgraded to Point Of Entry status. With a new addition of an international arrival gate in 2005, the US Customs and Border Protection (CBP) now maintains an office staffed full‐time at RFD with inspection services available 24 hours a day. In response to the creation of the Union Pacific Global III Intermodal Hub in Rochelle, over 1,000 acres of Greenfield space was added to our FTZ in Rochelle in 2005 and 2006; 74 acres in an industrial park in Woodstock was also part of the 2005 expansion. In Jan 2009, the Authority received approval to reorganize and expand FTZ #176, which now includes 18 partners and 20 sites/subzones. In 2010, we received approval to manage our Zone under the Alternative Site Framework (ASF), which expedites access for prospects and defines clearly the geographic service area of each Zone. Our service area encompasses all or part of 10 north central Illinois counties: Winnebago, Boone, McHenry, Stephenson, Ogle, DeKalb, Kane, Lee, Bureau, Putnam and LaSalle.

Environmental Issues The Authority is proactive to all environmental issues of the airport. A state‐of‐the‐art Glycol Retention/Treatment Facility was completed in 1994. An addition is currently being constructed to accommodate the NW cargo apron built in prior years as well as creating back‐up infrastructure options if at some point in the future there is the need to pump the glycol directly to the local reclamation facility. Glycol is the key liquid component used in deicing aircraft during the winter months.

Organization

The Board of Commissioners continues its aggressive stance to further grow all areas of airport development. The Authority is governed by a seven‐member Board of Commissioners. The members are appointed as follows:

 The Mayor of the City of Rockford, 3 members;  Winnebago County Board Chairman, 2 members;  The Mayor of the City of Loves Park, 1 member; and  The Village President of Machesney Park, 1 member.

The Board members serve five‐year terms, except that any person appointed to fill a vacancy will be appointed to serve the unexpired term. Members of the Board of Commissioners are eligible for reappointment. The Board selects an Executive Director to staff the respective departments and oversee the day‐to‐day operations.

Organization(con’t) Organizational Chart and Senior Manaagement

Senior Management

Amy M. Ott, CPA Deputy Director of Administration & Finance Kenneth Ryan Deputy Director of Air Cargo Development Janette Benoit Finance Manager

Following outlines the changes in total staffing by fiscal year as well as the creation of new departments to further breakdown prior departments. Only a slight change in actual staff to better reflect the operational needs of the organization. Personnel Positions by Department

45 40 35 30 25 20 15 10 5 0 FYE07 FYE08 FYE09 FYE110FYE11 FYE12

Administration/Finance Air Service Marketing Facilities/Maintenance Terminal Services AirFest Operations

Organization(con’t) The Executive Director of the Authority reports to the Board of Commissioners. In BFYE, airport staff is comprised of 47 employees (including seven Commissioners) as follows:

FYE11 FYE12 FYE13 Actual Actual Budget Administration & Finance Airport Commissioners 7 7 7 Executive Director 0 1 1 Deputy Directors 2 1 1 Managers 1 1 1 Properties Coordinator 1 1 1 FTZ Administrator 1 1 0 Executive Assistant 1 1 1 Accounting Assistants 2 2 2 Research Assistant 1 1 0 Administrative Assistants 1 1 1 Department Total 171715

Air Service Marketing Special Event Coordinator 1 1 1 Marketing Assistant 1 0 0 Department Total 2 1 1

Facilities & Maintenance Deputy Director 1 0 0 Manager 1 1 1 Supervisor 2 2 0 Operations & Facilities Technician I 101010 Operations & Facilities Technician II 4 4 4 Operations & Facilities Technician III 0 0 2 Department Total 181717

Operations Manager 0 0 1 Operations & Facilities Specialist 5 5 6 Department Total 5 5 7

Terminal Services Supervisor 1 1 0 Generalist 1 1 0 Operations & Facilities Technician III 3 3 3 Department Total 5 5 3

Cargo Development Deputy Director 1 1 1

Passenger Development Manager 0 0 1 Supervisor 0 0 2 Department Total 0 0 3

Total Organization 42 40 47

Strategic Plan

The Greater Rockford Airport Authority strategic plan is a tool for organizing the present on the basis of the projections of the desired future. It is a road map to lead the Authority from where it is now to where it would like to be in three to five years. The strategic planning process ensures that the most effective use is made of the Authority’s resources by focusing on key priorities. In January 2011, the Board of Commissioners approved the final plan and the budget now incorporates the resources necessary to accomplish the goals of the strategic plan. The plan presented is a three year goal. During this past year we have a new Director and there will be modifications and changes to better reflect his goals. However most will remain the same.

OBJECTIVES MEASURES TARGETS INITIATIVES

. Maintain reserves equal to or

. Maintain financial . Maintain adequate greater than 4 months of FINANCE AND . Monitor reserves monthly. stability reserves. expenses based on 3 year ADMINISTRATION history.

What must we deliver to . Growth in diversified . Greater than 80% of revenues . Monitor annual report, schedule of our stakeholders to . Revenues succeed financially? revenue sources. from other sources than UPS. major revenue sources.

. Ranking: Top 20 . Operations . Operations increase: 20% . Increase sales calls, public relations . Enplaned/Deplaned . Enplanements/Deplanements and global participation at . Expand cargo service cargo increase: 27% tradeshows. to increase economic . Landed aircraft weight . Landed weight increase: 27% . Develop financial incentives to grow, impact and viability. . Airline diversification . New airline operators: 3 and diversify domestic and . Airlines/International . International landed weight: international cargo activity. 15% increase . Develop incentives and/or marketing support to encourage existing and new airline partners to establish new

destinations or substantially expand

current service. . Ranking: Top 200 . Establish one‐off daily flying to . Expand passenger . New destinations: 7 multiple new top 30 destinations service to respond to . Destinations . Passenger increase: 100% based on the market service area. regional demand. . Passengers . External usage: 70% increase . Establish international and domestic . Regional Diversification outside Winnebago County seasonal flights in support of the . International traffic: 50% travel industry. increase . Create/maintain occasional CUSTOMERS AND . charter flying to highly desired STAKEHOLDERS destinations as mechanism to

promote RFD to industry and To achieve our vision, consumers. how will we serve and manage our customers . Develop a business who are airport users and . Business plan for heavy . Present plan in 6‐9 mos. . Research, prepare and present plan plan for heavy metal stakeholders? metal MRO . Accept plan in 9‐12 mos. to understand MRO market. MRO operations

. Develop collaborative opportunities for promotion, education and recruitment through various . Excel as a . Participation and . Continue and/or increase businesses and community events. community partner collaboration in the participation. for the region. community. . Go Global, Air Show. Ice Sculpting Contest (clean snow), Cub Scouts, College/High School Interns.

11 Strategic Plan(con't) .Maintain strong working relationship with consulting firm, Point Trade Services, Inc. .Continue development of strong regional network of economic development partners through Leadership Forum, Go Global, visits and attendance at their events. .Increase regional public awareness through public speaking opportunities. Go Global, Stateline World Trade Association and other external networking opportunities. . Add an average of one new FTZ .Remain current on FTZB regulations, .Increase number of operator/year. complying with all requirements of activated the program of the FTZ Board and sites/subzones . Annually generate revenue CBP.

through fees to cover 100% of .Retain active membership in NAFTZ, .Expand FTZ Activity .Service Fee revenue to total RFD operating cost for FTZ participating in committees/task GRAA. #176. forces, attending meetings and

speaking. .Throughput volume . Increase throughput by $1 .Expand marketing in regional (product in and out). billion within five years. business/logistics publications; promote articles in national business/global trade publications. .Finalize service areas with additional territory in Kane & McHenry Counties (Chicago) and permission to service Marshall County (Peoria). .Assist management in planning for staff succession, expansion and development training. .Acknowledge FTZ partner sites/subzones and provide support for activities and educational opportunities.

.Provide exceptional .Periodic customer satisfaction and continuously . Surveys show meet or exceed .Customer satisfaction surveys. Establish baseline for improving customer customer satisfaction. improvement. service.

.FAA Annual . 0 deficiencies .Ensure safe operational status during Certification times of severe weather. . 0 deficiencies .Enhance safety, capacity, and .Provide a world class .TSA Audit marketability with the following: safe and secure . 0 hours closed improved nav‐aids, perimeter airport. OPERATIONS AND .Operational Status roadway, airport control tower, FACILITIES . 5 or less OSHA recordable event rescue and firefighting, hydrant .Workplace Safety annually. fueling. What must we improve in our facilities, processes .Work order system that improves . . and physical assets order Improve and Balance between new efficiencies and measures future . to achieve our vision of upgrade opportunities and Make investments based on needs. . safety and security? infrastructure maintenance of existing budget, capital, and master plan Preventative maintenance checks and condition infrastructure services (PMCS) and scheduled equipment replacement program. .Implement SMS .Still being developed based on FAA (Safety Management .SMS Compliance . SMS Compliance in 6‐12 mos. regulations. System)

Strategic Plan(con't)

. Utilization and expansion of . Energy/Fuel Savings . 3% reduction in energy usage conservation and alternative energy . Protect and enhance per year. opportunities. the environment. . Comprehensive . Environmental work plan (within . Completion of an environmental work environmental plan. 12 mos). plan.

. Design and landscape plan for stone

pillars at Kishwaukee Street entrance. . Kishwaukee Street entrance . Enhancement of . Proactively work with state/local . Falcon Road rehabilitation landside . Airside/street side and agencies to enable funding for Falcon . Work with local utility providers infrastructure and facility improvements. Rd. rehabilitation. to enhance safety and aesthetics . Plan to evaluate airport projects to operational integrity of RFD. incorporate the efficient placement of all future utility infrastructures.

. 90% of all new hires rate . Attract and retain a satisfactory or better in the first . Performance appraisals done annually . Performance appraisals qualified and 6 mos. of employment and quarterly during first year of . Employee turnover workforce. . Turnover rate at 8% or less position. annually.

. Identify organizational wide training . Professional priorities to improve job skills and . Promote learning development and or . Hours of training or professional knowledge. and growth training opportunities development . Create and implement training/ and participation. professional development program. EMPLOYEES

. Assessment of current and future How will we sustain our workforce needs – 3 – 6 months, employees abilities to . Create plan and business case for change and improve succession plan 6‐12 months, . Approved resources in budget to . Implement initiatives . Creation, implementation and support leadership program. – 12 for succession . Development of written measurement of plan within 36 months, planning succession plan months. . Define processes, training and

development program 12 ‐ 18 months, . Communicate, execute and measure plan results for first year 18 – 36 months.

Financial Policies

The Authority’s long‐range goal is growth with balanced self‐sufficiency, efficient debt use, and the means to these goals are sound fundamental financial policies. The financial policies that lay the groundwork for the budget are as follows:

Basis of Accounting The annual financial statements of the Authority are prepared on the accrual basis of accounting, whereby revenues and expenses are recognized in the period earned or incurred. All transactions are accounted for in a single enterprise fund.

Pursuant to GASB Statement No. 20, Accounting and Financial Reporting for Proprietary Funds and Other Government Entities that Use Proprietary Fund Accounting, the Authority follows GASB guidance as applicable to proprietary funds and FASB Statements and Interpretations, Accounting Principles Board

Financial Policies(con’t)

Opinions and Accounting Research Bulletins issued on or before November 30, 1989 that do not conflict with or contradict GASB pronouncements.

Budgetary Data The Authority budget is prepared on an accrual basis with the exception for the following:

 Principal payments on long‐term debt are applied to the outstanding liability on a GAAP basis, as opposed to being expensed on a budget basis.  Capital outlays are recorded as assets on a GAAP basis and fully expended for budgetary purposes.

The budget process begins each October. Authority management has long recognized the importance of proper and accurate budgeting. Management annually creates a comprehensive line item budget that is adopted by the Board of Commissioners in a public meeting before the beginning of each fiscal year. The budget narratives are detailed projections of the expected financial operation over the next year in accordance with the Authority’s long‐range financial plans. The budget is created using zero‐based budgeting techniques where staff are required to estimate all revenues and expenditures as though each revenue and/or expenditure was being initiated for the first time.

Management’s control of the budget is maintained at the department level. It is the responsibility of each department to administer its operations in such a manner as to ensure that the use of funds is consistent with the goals and programs authorized by the Board of Commissioners.

The Authority’s definition of a balanced budget is one in which revenues and other resources equal or exceed expenditures and other uses. A balanced budget is an integral part of maintaining the Authority’s financial integrity. Strategies employed to attain this balance include cost reductions, personnel and service efficiencies, and increasing fees to match related expenses.

Operating Revenues and Expenses The Authority distinguishes operating revenues and expenses from non‐operating items. Operating revenues and expenses generally result from providing services in connection with the Authority’s operations. The principal operating revenues of the Authority are airport fees (primarily landing fees and fuel flowage fees) and lease revenue. The Authority also recognizes certain other revenues as operating revenues, including airport service fees, storm water retention fees, fuel permits, quarry fees, etc. Operating expenses for the Authority include personnel and benefit costs, contractual services costs, commodities and others. All revenues and expenses not meeting this definition are reported as non‐ operating revenues and expenses.

Cash, Cash Equivalents and Investments The Authority considers all highly liquid investments (including short‐term investments) with maturity of three months or less when purchased to be cash equivalents.

Investments are stated at fair value. Fair value is determined based primarily on the basis of quoted market prices. Interest income is recorded as earned.

Financial Policies(con’t)

Custodial Credit Risk – Deposits: Custodial credit risk is the risk that in the event of bank failure, the Authority’s deposits may not be returned to it. The Authority has a policy regarding custodial credit risk which requires that funds on deposit in excess of FDIC or FSLIC limits be secured by either securities guaranteed by the full faith and credit of the United States of America or obligations of the United States of America or its agencies. The Authority’s policy also requires that the amount of collateral provided shall not be less than 105 percent of the fair market value of the funds secured. Pledged collateral shall be held by the Authority or in safekeeping, evidenced by a safekeeping agreement. Collateral in safekeeping must be held by a third party or by an escrow agent of the pledging institution.

Credit Risk: The Authority may invest in public funds in certain types of security as allowed by the Public Funds Investment Act, 30 ILCS 235 et seg. “Public Funds” are defined as current operating funds, special funds, interest and sinking funds, and funds of any kind belonging to or in custody of the Authority. While the Public Funds Investment Act allows the investment of public funds in a wider range of possible securities, it is the policy of the Authority that investments be limited to the allowed securities as identified hereof.

Allowable securities are as follows:

 Bonds, notes, certificates of indebtedness, treasury bills, or other securities, which are guaranteed by the full faith and credit of the United States of America.  Bonds, notes, debentures, or other similar obligations of the United States of America or its agencies.  Any interest bearing account, deposit (including certificates of deposit), or any other investment constituting direct obligations of any bank, collateralized per the investment policy, and as defined by the Illinois Banking Act and only those insured by the Federal Deposit Insurance Corporation (FDIC).  Any repurchase agreement not to exceed 330 days as provided for in 30 ILCS 235/2 (h) so long as such repurchase agreements comply with said statute and are supported by the full faith and credit of the United States of America.

Custodial Credit Risk – Investments: For an investment, custodial credit risk is the risk that, in the event of the failure of the counterparty, the Authority will not be able to recover the value of its investments or collateral securities that are in the possession of an outside party. The Authority’s investment policy addresses custodial credit risk, as applicable, as detailed under Custodial Credit Risk – Deposits.

Concentration of Credit Risk – Investments: Concentration of credit risk is the risk of loss attributed to the magnitude of a government’s investment in a single issuer. The Authority’s investment policy allows for no more than 40 percent of the total investment portfolio, exclusive of U.S. Treasury securities held in safekeeping to be held at one financial institution.

Accounts Receivable Accounts receivable includes amounts due from Authority tenants as well as amounts due from the federal and state governments for grants. The amount shown is reduced by an estimated reserve for uncollectible accounts.

Financial Policies(con’t)

Taxes Receivable Taxes receivable include taxes levied in the current fiscal year that will be paid in the following fiscal year. The balance, net of a one percent allowance for uncollectible amounts, is fully deferred at year‐end because the tax levy will be used to fund expenses of the following year.

Designated Assets Designated assets include all deposits and receivables either legally restricted or Board designated for specified purposes. Designated assets are segregated, by purpose, as follows:

 Debt service – These assets are used to fund current maturities for the outstanding bond payments.  Capital projects – These assets are used to fund budgeted capital items with the exception of debt service.  Stormwater retention and landfill closure – These assets are restricted for the repair, maintenance and monitoring of the stormwater retention pond and for the estimated landfill closure costs.

When expenses are incurred for which both designated and unrestricted resources are available, it is the Authority’s policy to first apply designated resources. The Authority understands the need to replace capital items. In order to minimize the impact of future capital expenses, staff has planned for capital replacements with the use of designated assets and they are funded by annual deposits from excess funds available.

Capital Assets An accounting and inventory of all capital assets is maintained to ensure proper accounting control resulting in accurate financial reports. All individual items with a cost in excess of $2,000 that provide more than one year of economic benefit are capitalized. Depreciation is calculated by the straight‐line method using the assets useful life that is classified as follows: Years Buildings 20 Infrastructure 20 Machinery, equipment & vehicles 5 – 10 Furniture & fixtures 3 – 5

Routine maintenance and repairs are expensed as incurred. Significant betterment and improvements are capitalized and depreciated over their estimated useful lives. Interest incurred during the construction phase of capital assets is reflected in the capitalized value of the assets constructed, net of interest earned on the invested proceeds over the same period.

Deferred Charges and Unamortized Premium on Bonds All costs associated with the issuance of bonds and other long‐term debts are capitalized. Amortization is calculated by the straight‐line half‐year (bonds outstanding) method over the term of the debt. Bond premiums are amortized in the same manner. This method does not differ significantly from the effective interest method. Deferred charges also include UPS organizational costs and engineering costs which are being amortized using the straight‐line half‐year method.

Financial Policies(con’t)

Compensated Absences The Authority accrues vacation and sick pay benefits as earned by its employees.

Use of Estimates The preparation of financial statements requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates.

Net Assets The Authority classifies its net assets in three categories as follows:

 Invested in capital assets, net of related debt consists of capital assets, net of accumulated depreciation and reduced by outstanding balances for bonds and other debt that are attributable to the acquisition, construction or improvement of those assets.  Restricted net assets result when constraints placed on net assets use are either externally imposed by creditors, grantors, and the like, or imposed by law through constitutional provisions or enabling legislation. The Authority has no restricted net assets.  Unrestricted net assets consist of all other net assets that do not meet the criteria above.

Operating Reserves The Authority maintains operating reserve funds to protect against the need to reduce service levels, staff, or raise fees due to temporary revenue shortfalls or unprecedented one time expenditures. A reserve was established as a target minimum level to be maintained for exposure to natural disaster, severe unforeseen emergencies and economic uncertainties. The reserve policy will mitigate any future revenue fluctuations, where the revenues generated are interrupted or otherwise insufficient to offset the operating expenditure.

To ensure sound fiscal management, preserve Authority Board discretion in its resource allocation decisions, and minimize the impact to the community and airport users the Authority establishes the following operating reserve funding targets:

 Build a 3‐5 month reserve of the annual operating and non‐operating expenses using a three‐year trend to project the actual amount.  Transfer all types of revenue exceeding expenses, after the payment of debt service and on‐going capital project costs, into the reserve account until the target is met.  Maintain reserves in approved investments accounts that allow for projected needs of reserves as well as the ability to earn interest income where appropriate.

The recommended target amounts are based on recommendation from rating agencies and established best practices utilized by other municipalities.

Financial Policies(con’t)

Legal Debt Margin Pursuant to the Airport Authorities Act, the Authority is given the right to issue tax secured bonds without the approval of voters within its boundaries for construction and development of an airport, provided that:  The total of the bonds previously issued or to be issued does not exceed three‐quarters percent (0.75%) of the total assessed valuation of all taxable properties within the Authority’s boundaries, and  The plans and specifications are submitted to the State of Illinois Department of Transportation, Division of Aeronautics for approval.

The Authority may issue additional bonds; however, voter approval is required. The total amount of the bonds may not exceed two and three tenths percent (2.3%) of the total assessed valuation. The 2.3% debt limit is calculated as of the time of issuance of the bonds and includes all Authority indebtedness. The Authority is also subject to a 2.875% debt limitation with respect to all outstanding indebtedness. This limit is calculated as of the date of issuance of any debt, except tax anticipation notes, tax anticipation warrants and revenue bonds.

Tax Rate The current tax rate for the Authority is budgeted at $.0945 per $100 of assessed value.

Risk Financing The Authority purchases commercial insurance coverage for the various risks the Authority may encounter in its operations. Such risks of loss relate to torts; theft of, damage to and destruction of assets; errors and omissions; and worker’s compensation.

The Authority established a partial self‐insurance program beginning January 1, 2008 to cover the risks of health claims and has retained the services of an outside agency to administer its self‐insurance claims. The Authority does not assume unlimited liability for health claims as it maintains stop‐loss coverage, which covers medical expenses when they are incurred for amounts in excess of $3,500 annually for each participant.

Rates & Charges The Authority periodically approves a Rates & Charges Policy by resolution. The charges incorporated therein are determined by examining costs associated with the revenue stream. Rates & Charges are reviewed and amended periodically and are included in Exhibit 2. Rates and Charges are based on a combination of both residual and compensatory methods.

Internal Controls The Authority’s internal control structure is an important and integral part of its entire accounting system. The current structure in place is designed to provide reasonable, but not absolute assurance that: (1) assets are safeguarded against loss from unauthorized use or disposition; (2) transactions are executed in accordance with management’s authorization; (3) financial records are reliable for preparing financial statements and maintaining accountability for assets; (4) there is compliance with applicable laws and regulations; and (5) there is effectiveness and efficiency of operations. The concept of reasonable assurance recognizes that the cost of control should not exceed the benefits that are likely to be derived from them, and that the evaluation of cost and benefits requires estimates and judgment by management.

Financial Policies(con’t)

We believe that the Authority’s internal control framework adequately safeguards assets and provides reasonable assurance and proper recording of financial transactions.

One duty of the Finance Manager is to perform internal and external auditing functions. In the course of this assignment, the Finance Manager is authorized to have full, free and unrestricted access to all records relating to the audit.

Budget Document

Budgeting serves as an important management tool to plan, control and evaluate the operations of the Authority. The budget has been prepared in accordance with the standards set forth by the Government Finance Officers Association (GFOA) Distinguished Budget Presentation Award Program to fully disclose the financial operations of the Authority. Upon successful review and approval, this budget will be submitted to the GFOA for their consideration of this prestigious award.

The Authority used zero‐based budgeting (ZBB) techniques, which required staff to provide justification and support for all expenditures. This allows for evaluation of expenditures to ensure that each item supports and contributes to the goals of the organization. ZBB results in a more meaningful document that has the support of staff for implementation and utilization. This budget is divided into six components: transmittal letter, revenue budget, operating expenses budget, non‐operating budget, capital budget, and exhibit section. The operating expense budget is further broken down into departmental budgets.

Budget Process

Budget Adoption. The Authority’s budget is adopted by ordinance to comply with the provisions of State of Illinois Statute 50 ILCS 330/3, which requires a governing body to approve a budget within or before the first quarter of the fiscal year. In accordance with that same statute, the budget serves as the annual appropriations ordinance. The budget is prepared on a cash basis, whereby all revenues and expenses are recognized in the period in which cash is received and/or paid.

Budget Calendar. State law requires a tentative budget and appropriation ordinance be made conveniently available for public inspection at least thirty (30) days prior to final action thereon. Further, at least one (1) public hearing must be held prior to budget adoption and notice of this public hearing must be published in a newspaper at least thirty (30) days prior to the time of such hearing. The tentative schedule for this process is as follows:

24 February 2012 Approve Tentative Budget and Appropriation Ordinance (Exhibit 1) 8 March 2012 Public Hearing Notice published in newspaper 26 April 2012 Public Hearing 26 July 2012 Approve Adoption of Budget and Appropriation Ordinance (Exhibit 5)

Budget Process(con’t)

In the fall prior to the end of the fiscal year department heads begin creating draft budgets and capital recommendations and then submit the recommendations to the Finance Department for review in December. The draft budgets are reviewed with each department head and the Director and then coordinated against the available resources and any edits or modifications are done to align the goals and plans for the coming year. With staff recommendation, the budget is finalized and presented to the Board of Commissioners for review. In anticipation of the fiscal year beginning May 1, typically the public hearing is held and the budget is approved in April; however, due to significant events very near the fiscal year end, it was necessary to extend the budgeting process, public hearing and final adoption.

Budget Amendment. The Budget is amended only upon the occurrence of an extraordinary event, as deemed by the Executive Director, with concurrence by a majority of the Board of Commissioners and then only if funds are available.

Budget Monitoring. The independent monitoring of the budget continues throughout the fiscal year for management control purposes. Monthly financial statements comparing to budget are presented to all Senior Staff and Board Members for review. A Planning and Finance Committee comprised of the same meets monthly to discuss and review any significant items or changes.

Distinguished Budget Presentation Award

The Government Finance Officers Association of the United States and Canada (GFOA) presented a Distinguished Budget Presentation Award to the Greater Rockford Airport Authority for its annual budget for the fiscal year beginning May 1, 2011. This was the twelfth in as many years that the Authority has been awarded this prestigious award. In order to receive this award, a governmental unit must publish a budget document that meets program criteria as a policy document, as an operations guide, as a financial plan, and as a communications device.

This award is valid for a period of one year. It is believed the current budget continues to conform to program requirements; therefore, it will be submitted to GFOA to determine its eligibility for award. Following is a copy of the award.

Distinguished Budget Presentation Award(con’t)

Revenues

Two types of revenues are budgeted, operating and non‐operating. Operating revenue is derived from the day‐to‐day operations of the airport and includes landing fees, fuel flowage fees, hangar leases, land leases, building leases, airport service fees, AirFest revenues, operating grants, and FTZ fees. Non‐ operating revenue is a consequence of operating the airport; e.g., tax levy and interest income.

The airport services fee includes fees charged for services performed by our staff, which includes, badging, training, escorts, snow removal, deicing chemical application, international rubbish removal, fuel permitting and any other maintenance fees.

Shown below are the historical annual operating revenues. There was a positive trend through FYE08, mostly attributable growth in both cargo and passenger activity and the return of AirFest in FYE06. The subsequent decline in FYE09 and FYE10 are beginning to show a slight increase for FYE13 as the result of an increase in passenger volumes and rental car activity.

Operating Revenue History

$6,000

$5,000 Thousands

$4,000

$3,000

$2,000

$1,000

$‐ 2013 2004 2005 2006 2007 2008 2009 2010 2011 2012

Bud

Staff concentrates its efforts to increase the amount of fixed revenue over variable revenue as a high percentage of variable revenue could be financially catastrophic in an airport economic downturn. Lease revenue and other revenue (fixed revenue) will serve as a hedge in possible future economic downturns. As shown on the following page growth in airport fees is associated with the increased rates for landing fees and additional activity for diversions and charters. Staff continues efforts to investigate new opportunities for additional leased revenues.

Revenues (con’t)

FYE2013 FYE2012

Other Other Airport 8% Airport 9% Service Service Fees Fees 7% AirFest 5% Airport AirFest Airport Revenues Fees Revenues Fees 10% 44% 11% 44%

Lease Lease Revenues Revenues 30% 32%

Non‐operating revenues consist predominantly of the property tax levy, but also include replacement taxes and interest income collected on Authority deposits. Property taxes are levied to cover certain operating expenses. The total levy is approximately $.0937 per $100 of assessed valuation and the projected decrease is the result of assessed valuation reductions. Replacement taxes are projected to increase based on State of Illinois estimates. Airport Improvement Grant (AIP) funds and passenger facility charges are now considered non‐operating revenues where in the past they were categorized as contributions. Passenger facility charges project an increase based on enplanement growth for the next year.

Expenditures

Expenditures are also categorized between operating and non‐operating. Operating expenditures are those expenditures that are incurred as a result of the direct operation of the airport, and are further broken down by operating departments; Finance and Administration, Operations and Facilities, Air Service Marketing, Terminal Services and AirFest. Non‐operating expenditures are expenditures for debt service interest.

Following are the historical annual operating expenses. The growth has been somewhat steady through FYE06 and then changes from year‐to‐year. The significant growth through FYE06 is the addition of the Air Service Marketing Department and the return of the AirFest. The changes thereafter are the result of the various air service development agreements in place at the time to support growth of the passengers at RFD. Projections for the next three to five years show a moderate increase in the operating expenses as a result of growth in passenger and cargo services.

Expenditures(con’t)

Operating Expenses History

$9,000 $8,000

Thousands $7,000 $6,000 $5,000 $4,000 $3,000 $2,000 $1,000 $‐ 2004 2005 2006 2007 2008 2009 2010 2011 2012 Bud2013

Operating expenses are categorized into four areas, personnel service, contractual service, commodities, and other. Below is a chart showing the breakdown of costs by category.

Expenses by Category

Commodities 14% Other 3%

Contractual Personnel Services Services 42% 41%

Expenditures(con’t)

Personnel Services accounts for 41% of operating expenses and is traditionally one of the largest cost for the Authority. The Authoriy views the employees as its most important asset and works to hire the best most highly qualified and motivated people.

Contractual services is 42% of the total operating expenses and includes all contracted services and utilities. Commodities make up only 14% of total expenses which is down from the prior year. The Other category of 3% is for those costs not included in the other sections and include the glycol retention treatment facility, landfill and environmental costs.

Non‐operating expenditures consist predominantly of interest expense for debt. There has been a decrease from the prior year which is the result of additional principal payments on the current debt and therefore a reduction in interest expense.

Debt Service

The primary objective of debt management is to keep the level of indebtedness within the available resources, and comply with the legal debt limitations as established by the Airport Authorities Act. The Authority’s outstanding debt is $4.09 million in revenue bonds. The Authority has pledged the Airport Improvement Program (AIP) Federal Grant money it expects to receive in the future as a government revenue source to repay $4.09 million in general obligation alternate revenue bonds issued December 2008. Proceeds from the bonds provided financing to implement certain improvements to the Airport through construction of the Northwest Air Cargo Apron and Access Taxiway.

The Authority manages debt with the goal of only incurring debt where it economically has a benefit and the following table shows the history and future of the outstanding debt. There are plans to expand development and with that debt to support the expansion. The following schedule incorporates both principle and interest payments for the existing and planned debt uses for the year. Debt Schedule Millions

$10

$0 FYE05 FYE06 FYE07 FYE08 FYE09 FYE10 FYE11 FYE12 FYE13 FYE14 FYE15 FYE16 FYE17 FYE18 FYE19

General Obligation Bonds Revenue Bonds Interest Expense Line of Credit

Debt Service(con’t)

The last rating for the Authority was in October 2003 Moody’s upgraded the Authority bond rating to A1 from A2. The rating upgrade reflects the Authority eliminating bank loan debt, a moderate amount of rapidly retired bonded debt, resumption of a small amount of passenger service and the Authority’s stable and consistently well‐managed financial operations. As a result of the improved rating, the Authority was able to issue previous bonds with a lower interest rate thereby reducing the amount of future interest expense the Authority incurred. The plan is to continue to maintain a balance sheet that will allow for favorable rating in the future when necessary to issue ratable debt.

The legal debt margins as of April 30, 2012 are summarized as follows which shows the Authority is within the legal debt margin. Without With Total Voter Approval Voter Approval Debt Limitation

Assessed valuation at April 30, 2012 $ 3,350,383,974 $ 3,350,383,974 $ 3,350,383,974 Debt limit percentages 0.75 % 2.3 % 2.875 %

25,127,880 77,058,831 96,323,539 Outstanding general obligation debt ‐ ‐ ‐

Outstanding revenue bond debt ‐ 4,089,000 4,089,000 Total ‐ 4,089,000 4,089,000

FYE12 Legal debt margins $ 25,127,880 $ 72,969,831 $ 92,234,539

Capital Improvement Program

The Capital Improvement Program (CIP) is a five to ten year program that provides for critical improvements and asset preservation. The program includes projects that address federal security requirements, airfield safety, enhanced revenue potential, rolling equipment replacement, asset preservation and completion of the newly updated Master Plan.

Funding sources for the projects and replacements include Airport Improvement Program (AIP) grants, Passenger Facility Charges (PFC), allocated reserve funds, the balance of the capital accounts, operating revenues and short term borrowings where appropriate. The current year budget does not include any short term borrowings. Each year the Authority updates the five year equipment program and the 10 year infrastructure program. The 10 year plan is updated in conjunction with the Transportation Improvement Plan and the Master Plan when updated.

Airport Improvement Program (AIP) grants are offered from the Federal Aviation Administration (FAA) to provide funding assistance for eligible capital projects that meet the criteria of the federal program. The Authority meets annually with the FAA and Illinois Department of Transportation to review the 10‐year plan and discuss the upcoming year’s projects as well as any changes or additions to the plan. This is done prior to the FAA giving approval of each fiscal year plan.

Capital Improvement Program(con’t)

Title 49 of the United States Code (USC) authorizes the AIP program. The objectives of this federal program is to assist in development of a nationwide system of public use airports, to ensure the safe and secure operation of the airport and airway system, and to meet the projected needs of the public. The program is funded by aviation use fees, which are collected and deposited into the Airport and Airway Trust Fund that generates the revenues in support of the AIP. The US Congress authorizes expenditures from this dedicated fund on an annual basis each year. The AIP program includes entitlement and discretionary funding. Entitlement funds are awarded to eligible sponsors through a formula based on the number of passengers boarding and cargo aircraft tonnage. Discretionary funds are set aside to provide the FAA the flexibility to fund various high priority programs.

It is projected that FYE13 will include approximately $7.1 million in AIP eligible projects for airfield improvements. The AIP program typically provides funding for up to 90% of eligible project costs. The AIP program budget generally will include potential projects if discretionary funding becomes available. If the funding is not available during the year the project will carry forward to the next year. The current year budget includes the Authority’s share of approximately $370,136 of the $7.1 million in projects.

Passenger Facility Charges (PFC) were initially authorized through the Aviation Safety and Capacity Expansion Act of 1990. The Act allowed public agencies, which manage commercial airports to charge each enplaning passenger a facility charge in accordance with FAA requirements. The PFC is levied on the passenger tickets collected by the airlines, and forwarded to the airport (less a handling fee charged by the airlines). The revenues collected are to preserve or enhance safety, security, and capacity, to reduce noise or to enhance competition.

In October 1992, the Authority received approval from the Federal Aviation Administration (FAA) to impose a PFC of $3.00 per enplaned passenger. In April of 2007 the FAA approved the Authority’s request to increase the PFC level to $4.50 on all remaining reimbursements. The new collection rate commenced on June 1, 2007. The total approved collectible amount is $7,476,945 and the Authority has collected PFC’s, including interest earned totaling $4,093,264.

Projected FYE13 CIP capital expenditures are as follows and a specific list of the projects are outlined in the Capital Improvement section of the booklet.

Airside Projects $540,136 Landside Projects 3,700,000 Terminal Projects 871,000 Administration Projects 76,500 Maintenance Projects 306,800 Operations Projects 93,700 Total Capital Improvements $5,588,136

Net Assets

Following is a summary of changes in net assets. The information is presented on a GAAP full accrual basis. The summary of net assets does account for these items and cannot be tied to other balances in this document. Income or loss before capital contributions is the net income or loss from the statement of revenue and expenses. Capital contributions are from Federal, State and grant programs for non‐cash transfer of assets. The budget includes the net operating expense and net non‐operating revenue which will combine with the depreciation for the year to make up the balance of the projected income before Capital Contributions.

Summary of Changes in Net Assets

FYE08 FYE09 FYE10 FYE11 FYE12 BFYE13 Net Assets, Beginning of Year $110,731,482 $110,660,904 $108,373,005 $110,130,946 $111,001,882 $108,872,396 Income(loss) before Ca pi ta l Contributions (1,859,341) (3,534,449) (2,783,574) (4,607,106) (8,469,562) (3,902,094) Ca pi ta l Contri buti ons 1,788,763 1,246,550 4,541,515 5,478,042 6,340,076 5,500,000 Net Assets, End of Year $110,660,904 $108,373,005 $110,130,946 $111,001,882 $108,872,396 $110,470,302

Designated Assets

The Authority’s intent is to become a self‐supporting entity and, therefore, is accounted for as a proprietary fund. In a proprietary fund, the Authority accounts for its financial transactions similar to that of a private business enterprise. As a result the Authority has set up multiple bank accounts and investments for the four different types of sources and uses: operating, debt service, capital and trust funds for future expenditures. All expenses are paid with the appropriate resources. Since some capital expenditures have no funding source, other than those funded by FAA sources, it is necessary to transfer excess net operating proceeds from the Operating Account to these other accounts. This is generally done at year‐end when the amount of excess funds is known. All excess funds earned in the current year will fund the Capital Fund for the next year.

Operating account. The operating account is unrestricted and predominantly all operating monies (operating revenue and operating tax levy) are received and expended from this account (operating fund). Included, but separately identified is an Operating Reserve of approximately $2,000,000.

Debt service account. The debt service account is to support the principal and interest payments for the Alternate Revenue Bond which are then funded from this account.

Capital projects account. This fund pays for all capital improvements and capital programs unless accounted for specifically through a trust fund. Funding for this account is derived from Passenger Facility Charges (PFCs), excess operating monies from the previous year and AIP funds reimbursement. A portion of the AIP funds reimbursement planned for BFYE13 of $662,982 is also included in this account.

Trust fund account. Trust funds were established to fund future expenditures for the following purposes:

 Landfill closure fund,  Glycol retention/treatment facility fund,  Equipment replacement fund, and  Building re‐roof fund.

Designated Assets(con’t)

The landfill closure fund is estimated to be at approximately $1,196,000. The balance appears reasonable based on the environmental engineers review. There will be no contributions to the fund during the year.

The glycol retention/treatment facility fund is for future repairs and upgrades to this facility. This facility purifies the wastewater that is collected from de‐iced aircraft. The glycol treatment fund has a balance of $1,420,000 and is funded by the interest earned. The maximum balance for this fund caps out at $1.5 million.

The equipment sinking/replacement fund is for airport equipment purchases of larger equipment such as snow removal vehicles or fire trucks in the future. Presently, the fund balance is $2,450,000 and there are no plans in the current year to make a contribution other than interest earned on the existing funds. The expectation is the contributions will resume once revenues begin a steady growth. Typically this is funded by the receipts of auctioned equipment, investment earnings and a budgeted sinking fund transfer. A building re‐roof fund to fund an extensive re‐roof of the Coleman Hangar has a balance of $197,000. This balance appears adequate to fund the re‐roof in the future. The Authority views this as an effective way to manage large capital purchases.

A summary of the beginning balances, sources, uses, and ending balances for the segregated accounts are following.

Operating Debt Service Capital Proj. Trust Account Total Account Account Account Balance, 1 May 2012$ 4,284,065 $ 68,131 $ 180,289 $ 5,263,415 $ 9,795,900

Sources Operating revenue 5,360,071 80,206 5,440,277 Non‐operating revenue 562,000 562,000 Tax levy‐operating 3,297,300 3,297,300 Equipment Trust Funds ‐ ‐ Debt issue 5,500,000 5,500,000 PFC 473,247 473,247 AIP Fund Reimbursement 309,448 483,594 662,982 1,456,024 Other 20,000 20,000 Total Sources 9,528,819 563,800 6,636,229 20,000 16,748,849

Uses Operating expenses 9,434,087 9,434,087 Non‐operating expenses 161,706 161,706 Debt service payments 402,094 402,094 Capital expenditures 5,588,136 5,588,136 Total Uses 9,434,087 563,800 5,588,136 ‐ 15,586,023

Net Sources (Uses) 94,732 ‐ 1,048,093 20,000 1,162,825

Balance FYE12 before transfers 4,378,797 68,131 1,228,382 5,283,415 10,958,725

Transfers ‐ ‐ ‐ ‐ ‐ Balance, 1 May 2013 $ 4,378,797 $ 68,131 $ 1,228,382 $ 5,283,415 $ 10,958,725

Operating account balances include approximately $2,000,000 of operating reserves in ending balance.

Acknowledgement

Without the leadership and the commitment of the Authority’s management team and Board, the budget would not be as comprehensive of a document. The entire organization is acknowledged for their efforts in preparation of this document. The time and effort by all Deputy Directors, Managers and Support Staff is greatly appreciated. The end result of this process will be increased ownership for a dynamic and evolving document. Sincerely,

Amy M. Ott, CPA, CM Deputy Director

Budget Summary

Net Operating Expense (2,934,238) (3,865,073) (3,655,628) (4,440,056) (3,993,810) ‐10.1%

Excess Funds $ (1,035,672) $ 703,278 $ 1,000,880 $ (3,694,340) $ 1,162,825 ‐131.5%

Operating Revenue Summary

Revenue sources are grouped into five distinct categories: airport fees, lease revenues, airport service fees, AirFest revenues and other and is further broken down within each category. This breakdown allows a comparison of variable revenues (airport fees and AirFest) vs. fixed revenues (lease revenue).

$7,000

$6,000

Thousands $5,000

$4,000

$3,000

$2,000

$1,000

$0 2008 2009 2010 2011 Est 2012 Bud 2013

Airport Fees Lease Revenues AirFest Revenues Airport Service Fees Other

Airport fees – airside, $2,192,040. Airport fees – airside revenue is comprised of landing fees, ramp fees, and fuel flowage fees. These fees are generated on the runways, taxiways, aprons, and in areas of the terminal. They are variable in nature and dependent upon an aircraft landed weight, number of aircraft seats or gallons of fuel pumped. Fuel flowage fees were calculated using the prior year estimated fueling and economic indicators. Most fuel flowage is from the general aviation and small commercial operations and has budgeted similar activity as the prior year.

Landing fees for cargo are projected based on 892 million pounds, which is slightly less than last year’s estimates. Based on discussions with the cargo operators and other economic indicators there is minimal growth planned for FYE13. Landing fees for passenger airlines are projected to increase as a result of additional flights planned for the new year. Included are estimates for landing fees related to diversions and charters. RFD is a major diversion airport for airlines flying to O’Hare, Midway and Milwaukee.

Ramp fees are related to usage by airlines from the Jetway to the terminal. The Authority has attempted to create a common use terminal. All users pay one fee for use of jetway, baggage claims, and counter space. All gates and counter space in the terminal are common use. Ramp fees are expected to increase based upon an increase in passenger activity.

Airport fees – landside, $200,000. The revenue in this category is rental car commissions. As in the previous category, these revenues are also variable in nature. Revenues are expected to increase slightly from the FYE12 projected yearend amounts as a result of additional passenger activity and new management of one rental agreement.

Operating Revenue Summary(con’t)

Lease revenue – on airport, $950,634. Lease revenue is fixed over time and includes building, terminal, concessions/counters/office and land. These sources of revenue are not dependent upon an independent variable (except for time), and are recurring from year‐to‐year, with the exception of rental increases. Because of their nature, these revenues are easily and more accurately budgeted than variable revenues. The revenues in this category are all on the airport or within the perimeter fence. Lease revenue – on airport is expected to decrease as a result of the loss of BAX Global cargo operations.

Lease revenue – off airport, $690,730. Sources of revenue include building and land leases. These sources are also fixed and do not vary much over time and are outside the perimeter fence and are largely considered an industrial park. Lease revenue–off airport is planned to increase based on potential new leasing opportunity.

AirFest revenue, $606,700. AirFest revenues are all the dollars associated with the annual airshow. This will be the seventh show since the return of the event. With the history and experience the budget amount appears to be a reasonable estimate based on a two day show with an approximate attendance of 75,000.

Airport service fees, $357,200. Airport service fees are a newly created category. Previously the amounts were considered immaterial to the whole and included as part of the other category. However, over the past year staff evaluated the costs and staff time associated with the various services and made changes to the rates and charges to properly recover the costs associated with the services. Airport service fees include badging, training, escorting, snow removal, international rubbish removal, deicing chemical application and any other services provided. The amount budgeted is based on estimated activity levels for badging and international rubbish. The snow and deicing fees are based on our regional averages.

Other – $442,974. Other revenue sources include commercial operating agreement fees, quarry fees, foreign trade zone fees, and other miscellaneous income. Most of these revenues are incidental to the operation.

33 Operating Revenues Budget

ACTUAL ACTUAL ACTUAL ACTUAL BUDGET ESTIMATE BUDGET $ Chg/FY12 %Chg/FY12 CODE/LINE ITEM FYE08 FYE09 FYE10 FYE11 FYE12 FYE12 FYE13 Budget Budget AIRPORT FEES‐AIRSIDE 4120 Fuel flowage fees $ 64,943 $ 222,524 $ 152,393 $ 171,105 $ 173,000 $ 81,605 $ 103,000 4140 Landing fees ‐ cargo 2,486,389 2,253,129 1,726,052 1,630,620 1,715,694 1,622,670 1,667,194 4141 Landing fees ‐ non cargo 279,763 238,732 240,193 250,817 260,785 206,703 271,024 4142 Landings ‐ terminal fees 55,700 57,289 76,633 88,606 98,735 56,911 150,821 TOTAL FEES‐AIRSIDE 2,886,795 2,771,674 2,195,271 2,141,149 2,248,215 1,967,889 2,192,040 (56,175) ‐2.50%

AIRPORT FEES‐LANDSIDE 4270 Rent‐a‐car commissions 203,631 170,526 128,145 166,014 170,000 182,268 200,000 TOTAL FEES‐LANDSIDE 203,631 170,526 128,145 166,014 170,000 182,268 200,000 30,000 17.65%

LEASE REVENUE‐ON AIRPORT 4330 Building 556,981 582,604 595,061 512,448 537,248 590,802 480,929 4360 Land 347,430 367,523 442,006 496,146 477,127 418,860 404,696 4361 Tie‐down 7,630 4,864 2,450 7,818 5,700 8,323 5,700 4380 Terminal concession/counter/offices 59,948 44,415 44,352 49,185 73,164 75,751 59,309 TOTAL LEASE‐ON AIRPORT 971,989 999,406 1,083,870 1,065,598 1,093,239 1,093,736 950,634 (142,605) ‐13.04%

LEASE REVENUE‐OFF AIRPORT 4430 Building 139,352 150,744 145,570 156,095 145,511 156,095 322,196 4460 Land 310,352 318,238 318,356 342,657 343,040 342,657 368,534 TOTAL LEASE‐OFF AIRPORT 449,704 468,982 463,926 498,751 488,552 498,751 690,730 202,178 41.38%

AIRFEST REVENUE 4915 Air Show‐ Concessions 163,364 72,494 229,518 199,821 200,000 113,630 200,000 4916 Air Show ‐ Sponsors 184,424 261,268 116,475 151,142 140,000 157,142 140,000 4917 Air Show ‐ Special Promotions 19,649 16,120 28,436 26,890 15,000 21,325 15,000 4918 Air Show ‐ Marketing 24,732 5,292 25,841 27,642 22,500 17,427 16,700 4919 Air Show ‐ Show Tickets 266,076 179,947 267,799 208,087 235,000 186,439 235,000 TOTAL AIRFEST REVENUE 658,245 535,121 668,069 613,582 612,500 495,962 606,700 (5,800) ‐0.95%

AIRPORT SERVICE FEES 4950 Fuel permits 4,200 4,200 4,200 4,200 4,200 4,200 4,200 4955 Late fees ‐ 444 ‐ ‐ 1,000 ‐ 1,000 4970 Snow removal/maintenance fees 17,840 28,720 1,420 7,645 12,000 2,785 12,000 4971 International rubbish disposal fee ‐ ‐ 110,120 132,930 89,270 100,000 4972 Deicing chemical application fee ‐ ‐ 80,778 198,000 138,628 198,000 4975 Other airfield service fees 15,050 41,107 384,830 31,667 42,000 27,698 42,000 TOTAL AIRPORT SERVICE FEES 37,090 74,471 390,450 234,410 390,130 262,580 357,200 (32,930) ‐8.44%

OTHER 4920 Clean fill 52,108 ‐ ‐ ‐ ‐ ‐ ‐ 4930 Commercial operating agreement 75,377 73,979 76,239 75,185 82,744 76,225 84,424 4940 Foreign trade zone fees 53,625 63,750 71,042 72,500 87,250 70,000 77,250 4960 Quarry fees 134,820 90,000 90,000 90,000 90,000 90,000 90,000 4980 Stormwater fees 150,000 150,000 150,000 150,000 150,000 150,000 150,000 4985 Other agency grants 1,108,489 50,000 220,400 61,201 ‐ 17,791 ‐ 4990 Miscellaneous 15,196 22,288 48,472 78,078 41,300 48,124 41,300 TOTAL OTHER 1,589,615 450,017 697,015 526,964 451,294 452,140 442,974 (8,320) ‐1.84% TOTAL OPERATING REVENUE $ 6,797,069 $ 5,470,197 $ 5,626,745 $ 5,246,468 $ 5,453,930 $ 4,953,326 $ 5,440,277 (13,653) ‐0.25%

34 Operating Revenue Budget Justifications

AIRPORT FEES‐AIRSIDE 4120 Fuel flowage fees $ 103,000

4140 Landing fees $ 1,667,194

4141 Landing fees ‐ non cargo $ 271,024

4142 Landings ‐ ramp fees $ 150,821

AIRPORT FEES‐LANDSIDE 4270 Rent‐a‐car commissions Budgeted automobile rental commissions are calculated on average monthly rental commissions of approximately $14,166 per month. $ 200,000

LEASE REVENUE‐ON AIRPORT 4330 Building lease‐on airport Buildings and hangars owned by the Authority and located within the airport perimeter fence line are considered on airport (airside) building leases. T‐hangars, 17 @ $232.30/mo. 48,572 T‐hangars, 2 @ $266.55/mo. 657 T‐hangars, 1 @ $308.85/mo. 3,799 T‐hangars, 2 @ $312.50/mo. 7,687 T‐hangars, 2 @ $334.90/mo. 8,238 T‐hangars, 1 @ $347.00/mo. 4,268 T‐hangars, 1 @ $354.10/mo. 4,355 T‐hangars, 2 @ $385.65/mo. 9,487 T‐hangars, 3 @ $415.25/mo. 15,322 T‐hangars, 2 @ $448.00/mo. 11,021 T‐hangars, 1 @ $478.15/mo. 5,881 Plot #A‐9, Alpine Aviation 11,220 Plot #A‐5, Rock Valley College 35,335 Plot #A‐10, Mechanical Tool & Eng. 27,687 Plot #A‐12, Emery Air Charter 94,150 Plot #A‐15, Heritage Aero 39,732 Plot #A‐20, Pride Aviation 21,546 Plot #A‐21, Hot Shot Express 29,972 International Cargo Facility ‐ Anderson Packaging 102,000 Total building lease‐on airport $ 480,929

4360 Land lease‐on airport A lease is considered a land lease if the land is leased and the lessee has added an improvement (building). Plot #A‐1, Aircraft Systems Inc. 9,195 Plot #A‐2, Kaney Aviation 17,640 Plot #A‐3, Courtesy Aircraft, Inc. 17,698 Plot #A‐3A, Courtesy Aircraft, Inc. 7,802 Plot #A‐4, Avionics Place 18,964 Plot #A‐6, Owners Association 13,734 Plot #A‐8, Emery Air Charter 53,048 Plot #A‐11, First Franklin Investment 9,724 Plot #A‐14, Kaney Aviation 12,393 Plot #A‐17, 1896 LLC (Rubloff) 14,476 Plot #A‐18, Rubloff Hangar, LLC 50,875 Plot #A‐19, HSI Investments, LLC (Pride) 14,495 Plot #A‐23, Emery Air Charter 81,956 Plot #A‐23A, Emery Air Charter 17,454

35 Operating Revenue Budget Justifications

Plot #A‐27, Superior Plane Aircraft 6,774 Plot #A‐28, HSI Investments, LLC (Pride) 16,087 Plot #A‐29, Kaney Aviation 19,582 Plot #A‐32, Emery Fuel Farm 13,406 Airmen, Inc. ‐ Bldg D 2,638 Airmen, Inc. ‐ Bldg E 3,012 Airmen, Inc. ‐ Bldg F 3,744 Total land lease‐on airport $ 404,696

4361 Tie‐down $ 5,700

4380 Terminal lease‐concession/counter/offices Automobile rental‐Avis 7,734 Automobile rental‐Hertz 7,726 Automobile rental‐National 8,292 Office/Storage Space ‐ Chicago Aircraft 3,400 Airline Office Space ‐ Allegiant 7,748 Food service‐coffee shop 12,000 General Serv.Adm. (FAA/TSA) 12,409 Total terminal lease $ 59,309

LEASE REVENUE‐OFF AIRPORT 4430 Building lease‐off airport

Buildings owned by the Authority and located outside the fence line are considered off airport (landside) building leases. Prof Building ‐ UPS Employment 19,491 Ops Bldg ‐ FAA 4,700 Plot #I‐2 6772 Falcon Rd (Pride) 20,180 Plot #I‐8 Emery Air 13,845 Plot #I‐30 CWTS 25,274 Plot #I‐15 ‐ CMT 39,884 Kennamental 1,200 Metro Enforcement 14,400 Carwash Ventures Unlimited 9,221 4080 Easy Street 174,000 Total building lease‐off airport $ 322,196

4460 Land lease‐off airport A lease is considered a land lease if the land is leased and the lessee has added an improvement (building). Farm, 608 acres @ $85/acre 45,730 Solar Farm 6,720 Plot #I‐3 Richard McQuality 18,308 Plot #I‐4 Mechanical Tool & Engineering 6,663 Plot #I‐5 Mrs. Mary Barker 5,935 Plot #I‐7 Elco Textron Industries 4,209 Plot #I‐9 Rock Road Company 87,807 Plot #I‐10 Greenfield Industries 2,946 Plot #I‐11 Fitzgerald Equipment Company 14,218 Plot #I‐12 Parkside Warehouse 13,698 Plot #I‐12A Parkside Warehouse 8,736 Plot #I‐13 Barker Rockford Company 31,673 Plot #I‐14 Clinkenbeard 7,485 Plot #I‐16 Airport Pet Lodge 421 Plot #I‐18 Freeway Rockford 25,000 Plot #I‐19 Parkside Warehouse 17,413

36 Operating Revenue Budget Justifications

Plot #I‐21 Mechanical Tool 3,101 Plot #I‐22 Willett, Hofmann & Associates 7,849 Plot #I‐25 Precision Group 13,414 Plot #I‐26 Blackbird, Inc 5,023 Plot #I‐27 YMA Inc dba Airport Shell 12,142 Plot #I‐28 Comet Fabrication 5,603 Plot #I‐28B Comet Fabrication 7,634 Plot #I‐28C Comet Fabrication 5,591 Plot #RM‐2, Sjostrom & Sons 11,215 Total land lease‐off airport $ 368,534

AIRFEST REVENUES 4915 Air Show‐ Concessions 200,000 4916 Air Show ‐ Sponsors 140,000 4917 Air Show ‐ Special Promotions 15,000 4918 Air Show ‐ Marketing 16,700 4919 Air Show ‐ Show Tickets 235,000 Total AirFest $ 606,700

AIRPORT SERVICE FEES 4950 Fuel permits Fuel permits are based upon fuel dispensing criteria. Emery Air Charter 1,125 Courtesy Aircraft 600 Rubloff LLC 600 Kaney Aviation 375 Pride Aircraft 1,125 UPS 375 Total fuel permits $ 4,200

4955 Late fees Fees paid after due date are assessed a late fee in accordance with lease agreement. $ 1,000

4970 Snow removal/maintenance fee Charges to airport tenants for contracted snow removal and maint. services. $ 12,000

4971 International rubbish disposal fee Fees related to the disposal of international rubbish from flights $ 100,000

4972 Deicing chemical application fee Fees for labor, equipment and material related to deicing of tenant requested areas $ 198,000

4975 Other airfield service fees Fees for other services such as badging, training, finger printing and escorting. $ 42,000

OTHER 4930 Commercial operating agreements

Budgeted Commercial Operating Agreements are based upon the actual square footage of the building footprint for tenants inside the fence @$.28/sq.ft./yr. Non‐tenants doing business inside the fence pay a fee of $250. HSI Investments, LLC, A19, A28 28,530 sq.ft. 7,988 Aircraft Systems, A1 8,064 sq.ft. 2,258 Avionics Place, A4 7,300 sq.ft. 2,044 Courtesy Aircraft, A3 10,682 sq.ft. 2,991 Emery Air Charter, A8, A12, A23 134,023 sq.ft. 37,526 Groom, Norm, T/H B6 1,449 sq.ft. 406

37 Operating Revenue Budget Justifications

Kaney , A2, A14, A29 31,920 sq.ft. 8,938 Pride Aircraft, A20 4,620 sq.ft. 1,294 Alpine Aviation, A9 2,480 sq.ft. 694 Rubloff/1896, A18, A17 31,836 sq.ft. 8,914 Heritage Aero, A15 12,000 sq.ft. 3,360 Superior Plane Aircraft Coating, A27 3,000 sq. ft. 840 Drews Aviation, E‐12 1,447 sq.ft. 405 Non‐tenant commerical operators 6,766 Total commercial operating agreements $ 84,424

4940 Foreign trade zone fees General purpose/subzones ‐ various sizes (4) 47,250 Developer greenfield sites (10) 20,000 Service fees 10,000 Total foreign trade zone fees $ 77,250

4960 Quarry fees Royalties‐ Rockford Sand & Gravel $ 90,000

4980 Stormwater fees Budgeted storm water fees. (currently UPS is the only user) United Parcel Service ($12,500 x 12) $ 150,000

4990 Miscellaneous Vending machine commissions 5,500 Scrap iron 1,800 Airport fines 2,000 Other 32,000 Total miscellaneous $ 41,300

Operating Expenses Summary

As a result of organizational changes during the year the Authority was broken down further in to eight departments with respective Directors or Managers responsible for each independent budget. You will have the opportunity to better understand the goals and objectives of the organization and how the various expenses align with our strategic plan. The eight departments include the existing Administration and Finance, Marketing, AirFest and Terminal. The remainder of the departments had further breakdown into a Facilities and Maintenance, Operations, Passenger Development, Cargo Development. Each departmental budget is presented in the subsequent sections. This includes a summary of the department, goals for the coming year, the budget, and justifications. Each department except for AirFest is directly related to all revenue sources. Without the staff in each of these departments working together the revenue sources would not continue to evolve and strengthen.

As the charts below show that a majority of the costs are related to directly operating the airport and maintaining all the infrastructure and buildings.

FYE2013 Budget FYE2012 Budget Expenses by Department Expenses by Department

Operations 19% Operations & Facilities Facilities & 51% Maintenance Marketing 34% 7% Marketing & Terminal Air Service Services Development 7% 10% Finance & AirFest Terminal Finance & Administratio 8% Services Administratio n Passenger 8% n 18% Development AirFest 5% Cargo 21% 8% Development 2%

The following pages are a combined report by department comparing to the prior year’s budget. The report allows for a better understanding of how certain costs are allocated.

39 Operating Expenses Combined Departmental Budget

Dept 04 Dept 05 Dept 07 Dept 08 Dept 09 Dept 10 Cargo Dept 11 Air Dept 06 Opers BUDGET FYE13 BUDGET FYE12 $ Change % Change CODE/LINE ITEM, All Departments Fin/Admin Fac/Maint Marketing Terminal Airfest Dev Serv Dev PERSONNEL SERVICES 5400 Insurance 85,597 $ 164,956 $ 63,538 $ 11,972 $ 23,848 $ 12,551 $ 11,465 $ 29,017 $ 402,942 $ 388,234 $ 14,708 3.79% 5401 Insurance‐retirees 100,280 ‐ ‐ ‐ ‐ ‐ ‐ ‐ 100,280 120,707 (20,427) (16.92%) 5450 Overtime 801 68,612 7,576 378 10,395 17,699 ‐ 105,461 116,473 (11,012) (9.45%) 5451 Double time ‐ 28,009 5,006 ‐ 8,883 8,464 ‐ 50,361 50,373 (12) (0.02%) 5500 Payroll taxes 56,484 83,373 28,852 5,251 10,884 8,585 8,728 15,648 217,805 207,107 10,698 5.17% 5560 Pension contribution 82,766 114,946 30,742 6,208 14,679 8,036 13,494 17,544 288,416 224,479 63,937 28.48% 5600 Salaries/wages 745,373 907,399 329,394 62,627 109,362 98,650 120,484 189,598 2,562,886 2,512,636 50,250 2.00% 5610 Pager pay ‐ 7,800 ‐ ‐ ‐ ‐ 7,800 5,200 2,600 50.00% 5700 Tool allowance ‐ 2,400 ‐ ‐ ‐ ‐ 2,400 2,400 ‐ 0.00% 5750 Training 2,750 7,750 16,400 ‐ ‐ ‐ ‐ 3,000 29,900 19,650 10,250 52.16% 5800 Workers compensation insurance 1,951 77,809 25,313 163 11,206 2,517 313 4,906 124,178 101,921 22,256 21.84% 5900 Uniforms ‐ 5,034 2,202 ‐ 944 ‐ 8,180 6,864 1,316 19.17% 5901 Uniforms‐lost,damaged,replaced ‐ 100 50 ‐ 100 ‐ 250 300 (50) (16.67%) 5903 Uniforms‐protective clothing ‐ 7,325 1,600 ‐ 600 ‐ 9,525 5,300 4,225 79.72% TOTAL PERSONNEL SERVICES 1,076,001 1,475,514 510,672 86,598 190,900 156,501 154,484 259,713 3,910,384 3,761,645 148,739 3.95%

CONTRACTUAL SERVICES 6021 Ad‐Television ‐ ‐ 28,000 ‐ ‐ 28,000 49,000 (21,000) (42.86%) 6022 Ad‐Radio ‐ ‐ 51,000 ‐ ‐ 51,000 32,500 18,500 56.92% 6023 Ad‐Billboards ‐ ‐ 2,500 ‐ ‐ 2,500 11,000 (8,500) (77.27%) 6024 Ad‐Direct ‐ ‐ 35,000 ‐ ‐ 35,000 34,500 500 1.45% 6025 Ad‐Promotions ‐ ‐ 46,000 ‐ ‐ 46,000 93,250 (47,250) (50.67%) 6026 Ad‐Print ‐ ‐ 128,000 ‐ ‐ 128,000 116,000 12,000 10.34% 6027 Ad‐Internet/web ‐ ‐ 59,500 ‐ ‐ 59,500 66,000 (6,500) 100.00% 6050 Audit 29,915 ‐ ‐ ‐ ‐ 29,915 28,915 1,000 3.46% 6040 Airfield repair ‐ 18,000 ‐ ‐ ‐ 18,000 11,500 6,500 56.52% 6100 Building repair ‐ 36,000 ‐ 22,000 ‐ 58,000 47,000 11,000 23.40% 6121 Milesahead program ‐ ‐ 27,500 ‐ ‐ ‐ 27,500 48,000 (20,500) (42.71%) 6140 Conferences & meetings 6,375 ‐ 4,500 3,250 ‐ 1,500 8,705 5,600 29,930 28,090 1,840 6.55% 6145 Air service start up ‐ ‐ ‐ ‐ ‐ ‐ ‐ 15,000 (15,000) 0.00% 6150 Revenue guarantee ‐ ‐ ‐ ‐ ‐ 190,000 190,000 220,200 (30,200) 0.00% 6160 Consulting services 87,000 ‐ 148,500 ‐ ‐ ‐ 15,000 250,500 219,850 30,650 13.94% 6161 ARFF contractual services ‐ ‐ 1,142,573 ‐ ‐ ‐ 1,142,573 1,095,011 47,562 4.34% 6162 ARFF training ‐ ‐ 28,000 ‐ ‐ ‐ 28,000 28,000 ‐ 0.00% 6165 Airshow contractual ‐ ‐ ‐ ‐ 228,500 228,500 194,000 34,500 17.78% 6170 Airshow lodging ‐ ‐ ‐ 40,000 40,000 37,500 2,500 6.67% 6175 Airshow rental services ‐ ‐ ‐ 57,950 57,950 55,950 2,000 3.57% 6185 Airshow food and beverages ‐ ‐ ‐ 49,250 49,250 42,750 6,500 15.20% 6190 Airshow transportation ‐ ‐ ‐ 52,250 52,250 48,000 4,250 8.85% 6201 Energy‐electric 37,000 150,000 ‐ 140,000 ‐ 327,000 333,000 (6,000) (1.80%) 6202 Energy‐natural gas 9,000 37,700 ‐ 17,500 ‐ 64,200 72,900 (8,700) (11.93%) 6300 Engineering services 39,000 ‐ ‐ ‐ 7,500 46,500 47,500 (1,000) (2.11%) 6321 Equip maint‐repairs/services 1,000 21,915 ‐ 41,450 ‐ 64,365 35,065 29,300 83.56% 6322 Equip maint‐service contracts 15,450 65,217 2,717 ‐ 52,840 4,000 140,224 154,634 (14,410) (9.32%) 6350 Equipment rental 7,960 42,350 500 ‐ 4,000 8,050 62,860 36,670 26,190 71.42% 6400 Insurance 160,000 ‐ ‐ ‐ 10,500 170,500 158,056 12,444 7.87% 6402 Insurance deductible 5,000 ‐ ‐ ‐ ‐ 5,000 5,000 ‐ 0.00% 6410 Landscaping ‐ 6,000 ‐ 12,500 ‐ 18,500 12,500 6,000 48.00% 6440 Legal notices 4,025 ‐ ‐ ‐ ‐ 4,025 5,230 (1,205) (23.04%) 6451 Legal services‐general 50,000 ‐ ‐ ‐ ‐ 50,000 50,000 ‐ 0.00% 6452 Legal services‐personnel 8,000 ‐ ‐ ‐ ‐ 8,000 8,000 ‐ 0.00% 6453 Legal services‐other 3,600 ‐ ‐ ‐ ‐ 3,600 2,000 1,600 80.00% 6480 Licenses,titles & inspections ‐ 1,500 10,500 ‐ ‐ 452 12,452 14,952 (2,500) (16.72%) 6510 Medical exams 1,000 920 80 ‐ 500 ‐ 2,500 2,300 200 8.70%

40 Operating Expenses Combined Departmental Budget

Dept 04 Dept 05 Dept 07 Dept 08 Dept 09 Dept 10 Cargo Dept 11 Air Dept 06 Opers BUDGET FYE13 BUDGET FYE12 $ Change % Change CODE/LINE ITEM, All Departments Fin/Admin Fac/Maint Marketing Terminal Airfest Dev Serv Dev 6540 Membership dues 41,046 150 1,295 2,295 ‐ ‐ 12,300 525 57,611 46,971 10,640 22.65% 6600 Other 5,000 2,000 ‐ 1,000 1,580 8,500 ‐ ‐ 18,080 18,500 (420) (2.27%) 6640 Payment services 6,100 ‐ ‐ ‐ ‐ 6,100 6,100 ‐ 0.00% 6670 Permits & testing ‐ 1,400 ‐ ‐ ‐ ‐ 1,400 1,400 ‐ 0.00% 6700 Postage 5,800 ‐ 250 ‐ ‐ 6,050 7,350 (1,300) (17.69%) 6730 Printing 3,500 ‐ 22,000 ‐ 28,500 54,000 54,375 (375) (0.69%) 6751 Telephone‐cellular 3,600 13,440 4,200 1,020 2,250 1,800 1,320 2,370 30,000 25,670 4,330 16.87% 6752 Telephone‐local 17,111 12,750 14,540 450 13,580 500 450 1,680 61,061 50,877 10,184 20.02% 6800 Travel & transportation 30,390 4,800 5,000 3,570 ‐ 1,650 28,345 16,115 89,870 50,345 39,525 78.51% 6800 Customer care/customer service ‐ ‐ ‐ ‐ 1,500 1,500 2,000 (500) (25.00%) 6850 Utilities 1,500 5,000 ‐ 5,800 ‐ 12,300 12,300 ‐ 0.00% 6900 Vehicle maintenance ‐ 15,000 ‐ ‐ ‐ 15,000 20,000 (5,000) (25.00%) 6950 Waste removal ‐ 11,350 ‐ 91,000 ‐ 102,350 128,840 (26,490) (20.56%) TOTAL CONTRACTUAL SERVICES 578,372 445,492 1,213,905 559,835 405,000 500,902 51,120 232,790 3,987,416 3,884,551 102,865 2.65%

COMMODITIES 7100 Building repair 500 20,000 ‐ 24,000 ‐ 44,500 45,000 (500) (1.11%) 7140 Conferences & meetings 11,160 4,800 1,000 3,000 1,400 ‐ 4,000 15,000 40,360 26,870 13,490 50.20% 7200 Equipment 7,000 25,550 4,400 800 8,500 ‐ ‐ 1,300 47,550 41,750 5,800 13.89% 7240 Fence/gate ‐ 2,600 ‐ ‐ ‐ 2,600 2,600 ‐ 0.00% 7271 Fuel‐diesel ‐ 82,500 ‐ ‐ 250 82,750 82,750 ‐ 0.00% 7272 Fuel‐unleaded ‐ 38,400 ‐ ‐ 1,500 39,900 38,750 1,150 2.97% 7273 Fuel‐other ‐ 1,500 ‐ ‐ 28,000 29,500 21,543 7,957 36.94% 7300 Landscaping ‐ 4,500 ‐ 3,500 250 8,250 14,750 (6,500) (44.07%) 7380 Other 1,000 1,000 ‐ 1,000 3,000 ‐ ‐ ‐ 6,000 5,000 1,000 20.00% 7400 Pavement marking ‐ 80,500 ‐ ‐ ‐ 80,500 55,000 25,500 46.36% 7440 Pavement repair ‐ 22,000 ‐ ‐ ‐ 22,000 16,000 6,000 37.50% 7500 Raw materials ‐ 7,200 ‐ ‐ ‐ 7,200 7,200 ‐ 0.00% 7501 Raw materials‐deicing only ‐ 463,640 ‐ ‐ ‐ 463,640 463,640 ‐ 0.00% 7540 Signage ‐ 12,500 ‐ ‐ 7,500 5,400 25,400 20,000 5,400 27.00% 7580 Software 1,500 3,000 11,800 ‐ ‐ ‐ 16,300 15,830 470 2.97% 7600 Subscriptions 4,127 2,605 840 670 255 420 335 4,545 13,797 15,428 (1,631) (10.57%) 7660 Supplies‐janitorial ‐ 5,600 ‐ 19,800 3,000 28,400 18,740 9,660 51.55% 7690 Supplies‐lighting(airfield) ‐ 75,000 ‐ ‐ ‐ 75,000 75,000 ‐ 0.00% 7720 Supplies‐mechanical (airfield) ‐ 54,000 ‐ ‐ ‐ 54,000 52,000 2,000 3.85% 7750 Supplies‐office 10,350 600 2,600 750 ‐ 1,250 ‐ 1,400 16,950 16,520 430 2.60% 7780 Supplies‐other ‐ 2,500 ‐ ‐ 800 3,500 6,800 11,800 (5,000) (42.37%) 7782 Supplies‐hardware ‐ 7,000 ‐ ‐ 1,750 8,750 8,750 ‐ 0.00% 7796 Supplies‐promotional ‐ ‐ 11,000 ‐ 13,850 10,000 ‐ 34,850 25,350 9,500 37.48% 7810 Supplies‐specialty ‐ ‐ 21,000 ‐ ‐ ‐ 21,000 18,500 2,500 13.51% 7830 Supplies‐steel stock ‐ 3,200 ‐ ‐ ‐ 3,200 2,500 700 28.00% 7850 Supplies‐storm sewer/drain ‐ 1,500 ‐ ‐ ‐ 1,500 1,500 ‐ 0.00% 7880 Supplies‐welding ‐ 5,000 ‐ ‐ ‐ 5,000 5,000 ‐ 0.00% 7901 Maint‐licensed vehicles ‐ 12,350 ‐ ‐ ‐ 12,350 12,350 ‐ 0.00% 7902 Maint‐equipment ‐ 78,400 ‐ ‐ 1,000 79,400 90,000 (10,600) (11.78%) TOTAL COMMODITIES 35,637 1,017,445 41,640 17,220 60,455 59,570 14,335 31,145 1,277,447 1,210,121 67,326 5.56%

OTHER 8400 Glycol retention treatment facility ‐ 103,840 ‐ ‐ ‐ 103,840 89,240 14,600 16.36% 8410 Landfill environmental costs ‐ 110,000 ‐ ‐ ‐ 110,000 100,000 10,000 10.00% 8415 Property Taxes ‐ 45,000 ‐ ‐ ‐ 45,000 64,000 (19,000) (29.69%) TOTAL OTHER ‐ 258,840 ‐ ‐ ‐ ‐ ‐ ‐ 258,840 253,240 5,600 2.21%

FISCAL YEAR TOTALS $ 1,690,010 $ 3,197,291 $ 1,766,217 $ 663,653 $ 656,355 $ 716,973 $ 219,939 $ 523,648 $ 9,434,087 $ 9,109,557 $ 324,530 3.56%

Finance and Administration Department Summary

The Finance and Administration Department is responsible for the administration, financial management of policies and procedures of the Greater Rockford Airport Authority. The department includes the Director and the strategic goals and economic development planning.

The functions of the department which is led by the Deputy Director include financial planning and analysis, human resource development, risk management, property development and grant administration. The Department establishes and maintains safeguards to protect the Authority’s assets, which includes risk management duties. The Authority has over one hundred tenants and the Department administers and manages all leases. The Department issues fuel permits, commercial operating agreements, and prepares annual Disadvantage Business Enterprise Reports and Occupational Safety Health Administration Reports. Other areas of responsibility include all human resource functions including, but not limited to, policies and procedures, hiring, labor union negotiations issues, personnel files, and insurance related issues. The Department also has oversight of procurement and information technology services.

The following outlines the objectives for the department. We have included those below and future budgets will report the progress of these strategic objectives based on the targets outlined. Department initiatives to move the goals are listed below. Also noted are prior year results.

OBJECTIVES MEASURES TARGETS INITIATIVES

Maintain reserves equal to or Maintain financial greater than 4 months of Maintain adequate reserves. Monitor reserves monthly. stability expenses based on 3 year history. Growth in diversified revenue Greater than 80% of revenues Monitor annual report, schedule of major Revenues sources. from sources other than UPS. revenue sources. 90% of all new hires rate Performance appraisals satisfactory or better in the first Attract and retain a Performance appraisals done annually and 6 mos. of employment qualified and workforce. quarterly during first year of position. Turnover rate at 8% or less Employee turnover annually. Identify organizational wide training priorities Professional development and Promote learning and Hours of training or to improve job skills and knowledge. or training opportunities and growth professional development Create and implement training/ professional participation. development program. Assessment of current and future workforce needs – 3 – 6 months, Create plan and business case for succession plan 6‐12 months, Creation, implementation and Implement initiatives for Development of written Approved resources in budget to support measurement of plan within 36 succession planning succession plan leadership program. – 12 months, months. Define processes, training and development program 12 ‐ 18 months, Communicate, execute and measure plan results for first year 18 – 36 months.

Finance and Administration Department Summary(con’t)

OBJECTIVES MEASURES TARGETS INITIATIVES

Develop a business plan Present plan in 6‐9 mos. Business plan for heavy metal Research, prepare and present plan to for heavy metal MRO MRO understand MRO market. operations Accept plan in 9‐12 mos.

Develop collaborative opportunities for promotion, education and recruitment through Excel as a community Participation and collaboration Continue and/or increase various businesses and community events. partner for the region. in the community. participation. Go Global, Air Show. Ice Sculpting Contest (clean snow), Cub Scouts, College/High School Interns.

Maintain strong working relationship with consulting firm, Point Trade Services, Inc. Increase number of activated Add an average of one new FTZ Continue development of strong regional sites/subzones operator/year. network of economic development partners through Leadership Forum, Go Global, visits and attendance at their events. Increase regional public awareness through public speaking opportunities. Go Global, Expand FTZ Activity Annually generate revenue Stateline World Trade Association and other through fees to cover 100% of Service Fee revenue to GRAA. external networking opportunities. total RFD operating cost for FTZ Remain current on FTZB regulations, complying #176. with all requirements of the program of the FTZ Board and CBP. Retain active membership in NAFTZ, Throughput volume (product in Increase throughput by $1 participating in committees/task forces, and out). billion within five years. attending meetings and speaking. Provide a world class safe 5 or less OSHA recordable event Workplace Safety and secure airport. annually.

Goals and Objectives To ensure the operation and maintenance of a high quality, customer service oriented, financial self‐ sufficient airport system and to support the purpose and goals of the Authority by providing exceptional financial and administrative management.

 Increase the economic impact of RFD to the region and the State of Illinois.  Annual Receipt of the GFOA budget award.  Monthly Reports presented to Board and Staff on a timely basis.  Periodic review of airport rates and fees with the goal of keeping the cost competitive to the market place.  Receipt of GFOA certificate of achievement for excellence in financial reporting.  Assure that cash flows meet the Authority’s needs while maximizing investment opportunities.  Research and investigate other revenue sources for the Authority including but not limited to advertising, fuel farming, and new lease development.  Investigate and plan future funding strategies for large capital improvements and projects to be presented to the Planning and Finance Committee.  Continue to develop opportunities for additional business opportunities at the airport to include aviation related education and MRO operations.

Finance and Administration Department Summary(con’t)

Prior Year Results  Annual budget award and financial reporting certificate from GFOA received.  Acquisition of International Cargo facility and new tenant in facility.  Transition planning for new leadership within organization.  Training for staff in various areas.  Continued implementation of IT transition to a joint agreement with Winnebago County.

44 Finance and Administration Department Budget

ACTUAL ACTUAL ACTUAL ACTUAL BUDGET ESTIMATE BUDGET $Chg/FY12 %Chg/FY12 CODE/LINE ITEM, Department 04 FYE08 FYE09 FYE10 FYE11 FYE12 FYE12 FYE13 Budget Budget PERSONNEL SERVICES 5400 Insurance $ 85,996 $ 101,417 $ 104,512 $ 117,106 $ 117,557 $ 112,586 $ 85,597 5401 Insurance‐retirees 103,180 105,859 105,266 95,991 120,707 (83,121) 100,280 5450 Overtime 6,549 3,405 2,367 373 755 168 801 5500 Payroll taxes 75,746 65,956 65,683 68,312 69,006 79,123 56,484 5560 Pension contribution 53,895 55,003 65,722 107,103 72,685 87,284 82,766 5561 Pension contribution GRAA Pebsco 10,561 10,320 10,396 11,478 ‐ ‐ ‐ 5600 Salaries/wages 695,437 750,602 789,725 869,525 957,841 955,772 745,373 5605 Outside labor ‐ 6,572 ‐ ‐ ‐ ‐ ‐ 5750 Training 2,850 6,533 8,616 8,997 3,250 889 2,750 5800 Workers compensation insurance 4,519 3,693 5,714 6,435 1,573 1,750 1,951 TOTAL PERSONNEL SERVICES 1,038,733 1,109,360 1,158,003 1,285,319 1,343,372 1,154,451 1,076,001 (267,371)$ ‐19.90%

CONTRACTUAL SERVICES 6050 Audit 27,939 35,222 36,461 36,871 28,915 28,765 29,915 6100 Building repair ‐ ‐ ‐ ‐ ‐ ‐ 6140 Conferences & meetings 12,593 8,549 15,414 12,578 15,445 18,199 6,375 6160 Consulting services 85,454 73,087 128,129 66,662 64,850 72,427 87,000 6165 Airshow contractual ‐ performers and ho ‐ ‐ ‐ ‐ ‐ ‐ ‐ 6201 Energy‐electric 30,336 37,664 37,244 44,209 37,000 36,956 37,000 6202 Energy‐natural gas 19,911 20,224 15,537 14,490 13,000 9,674 9,000 6300 Engineering services 80,637 53,731 38,176 50,882 40,000 47,501 39,000 6321 Equip.maint‐repairs/services 105 300 ‐ 142 1,000 ‐ 1,000 6322 Equip.maint‐service contracts 11,571 17,390 16,461 17,722 13,970 15,696 15,450 6350 Equipment rental 10,637 10,616 11,481 9,418 8,080 8,065 7,960 6400 Insurance 216,091 222,628 226,807 184,974 148,032 153,559 160,000 6402 Insurance deductible 1,548 7,788 1,000 ‐ 5,000 ‐ 5,000 6440 Legal notices 8,646 6,372 5,058 3,963 5,230 3,025 4,025 6451 Legal services‐general 57,280 102,512 66,695 51,453 50,000 79,571 50,000 6452 Legal services‐personnel 3,334 7,144 1,235 2,953 8,000 13,361 8,000 6453 Legal services‐other 1,801 2,100 1,839 900 2,000 2,700 3,600 6480 Licenses, titles & inspections ‐ Airshow 188 340 156 ‐ ‐ ‐ ‐ 6510 Medical exams 45 624 369 924 1,000 1,158 1,000 6540 Membership dues 31,277 27,460 27,743 28,916 45,281 48,835 41,046 6600 Other 3,420 4,103 3,095 18,437 5,000 2,208 5,000 6640 Payment services 7,940 8,693 9,439 10,052 6,100 7,666 6,100 6700 Postage 9,152 7,759 7,177 5,754 7,100 3,480 5,800 6730 Printing 5,681 485 2,968 2,046 4,375 2,345 3,500 6751 Telephone‐cellular 3,259 4,113 5,495 6,065 5,700 6,155 3,600 6752 Telephone‐local 32,955 28,389 33,283 27,521 22,580 25,152 17,111 6753 Telephone‐long distance 3,445 3,822 3,762 2,776 ‐ 410 ‐ 6800 Travel & transportation 16,137 32,454 30,889 24,822 32,360 50,484 30,390 6850 Utilities 1,453 1,466 1,284 1,152 1,500 1,162 1,500 6900 Vehicle maintenance ‐ ‐ ‐ ‐ ‐ ‐ ‐ TOTAL CONTRACTUAL SERVICES 682,835 725,035 727,196 625,682 571,518 638,553 578,372 6,854$ 1.20%

COMMODITIES 7100 Building repair ‐ ‐ ‐ 6 500 ‐ 500 7140 Conferences & meetings 6,108 7,999 8,873 9,147 11,160 7,745 11,160 7200 Equipment 10,692 6,285 11,816 5,050 6,550 5,058 7,000 7380 Other 1,656 761 1,292 3,196 1,000 1,799 1,000 7540 Signage ‐ Airshow ‐ ‐ ‐ ‐ ‐ 280 ‐ 7580 Software 245 1,711 ‐ 2,941 3,830 395 1,500 7600 Subscriptions 6,808 2,724 3,329 4,083 3,803 4,823 4,127 7750 Supplies‐office 14,381 11,230 9,876 9,660 10,220 6,824 10,350 7780 Supplies‐other ‐ Airshow ‐ 45 ‐ ‐ ‐ ‐ ‐ TOTAL COMMODITIES 39,890 30,755 35,185 34,083 37,063 26,923 35,637 (1,426)$ ‐3.85%

DEPARTMENT TOTAL $ 1,761,458 $ 1,865,150 $ 1,920,384 $ 1,945,085 $ 1,951,953 $ 1,819,927 $ 1,690,010 (261,943)$ ‐13.42%

45 Finance and Administration Budget Justifications

PERSONNEL SERVICES 5400 Insurance Health, dental and life insurance costs for employees and eligible retirees. Health insurance The annual cost for the Authority for medicare eligible retirees is listed below; all those not medicare eligible have the same coverage as employees. The Authority is partially self funded and estimates for this partial funding are incorporated into the annual costs noted below. The annual cost for the Authority at 80% is as follows by each type of coverage: Employee = $5,504.74/$5,622.59 Employee + Spouse = $10,990.61/$10,985.78 Employee + Children = $10,202.04 Family = $15,687.89/$15,312.86 Medicare Supp. D = $2,126.88 Dental insurance The annual cost for dental is based on cobra rates as the program is self‐funded. Employee = $293.58 Family = $731.09 Life insurance

Life and AD&D insurance is provided to current employees. The benefit is 2.5 times an employee's base salary with life at $.22/$1000 and AD&D at $.05/$1000. Eligible retireees are also provided with a $2,500 life insurance benefit. Employees: Health 75,600 Dental 5,085 Life 4,911 Total employee insurance $ 85,597

5401 Retiree insurance Health 90,839 Dental 9,344 Life 97 Total retiree insurance $ 100,280

5450 Overtime Estimated 30 hours of overtime for hourly employees. $ 801

5500 Payroll taxes FICA ‐ 6.2% of base wage up to $110,100 42,628 Medicare ‐ 1.45% of base wage 10,898 State unemployment ‐ 2.15% of the first $13,560 2,959 Total payroll taxes $ 56,484

5560 Pension contribution IMRF pension fund ‐ 11.20% $ 82,766

5600 Salaries Commissioner stipends ‐ Seven commissioners 12,600 Salaries ‐ 9 full time employees 732,773 Total salaries $ 745,373

5750 Training Human resources & supervision 500 Procurement/finance 750 College courses ‐ aviation/business/IT 1,500 Total training $ 2,750

46 Finance and Administration Budget Justifications

5800 Workers compensation insurance $ 1,951

CONTRACTUAL SERVICES 6050 Audit Independent auditor 16,000 GFOA award applications ‐ Financial reporting and budget 715 Grant audits 12,000 Report production costs 1,200 Total audit $ 29,915

6140 Conferences & meetings RAEDC annual meeting 400 Chamber of Commerce, State of the City Luncheon 500 AAAE annual conference 800 AAAE National Air Service conference 600 FAA aviation forecast conference 650 Great Lakes AAAE conference 400 Allegiance air service planning conference 125 Other conferences ($300 ea) 900 Business lunches/dinners 2,000 Total conferences & meetings $ 6,375

6160 Consulting services Appraisal services 1,000 Information technology consultant 12,000 Other 4,000 Accounting software consultant 2,000 Financial analyst 3,000 FTZ Administration 65,000 Total consulting services $ 87,000

6201 Energy‐electric (60 Airport Dr.) $ 37,000

6202 Energy‐natural gas (60 Airport Dr.) $ 9,000

6300 Engineering services Cost for professional engineering services rendered by outside engineering firms. Crawford, Murphy & Tilly, Inc. 38,000 Other 1,000 Total engineering services $ 39,000

6321 Equip maint‐repairs/services $ 1,000

6322 Equip maint‐service contracts Software support ‐ Best FAS 1,680 Software support ‐ MAS90 3,720 Software support ‐ Peopletrak 600 Computer support 1,000 Copy machine ‐ usage 5,450 Internet security 2,000 Telephone system 1,000 Total equipment maintenance‐service contracts $ 15,450

47 Finance and Administration Budget Justifications

6350 Equipment rental Postage/scale meter lease ($650/qtr) 2,600 Copy machine ($430/mo) 5,160 Other 200 Total equipment rental $ 7,960

6400 Insurance Aviation liability 35,000 Automotive 23,000 Property 84,000 Public officials liability 18,000 Total insurance $ 160,000

6402 Insurance deductible $ 5,000

6440 Legal notices Publication costs for public notices, including bid documents, Treasurer's Report, personnel notices. Annual receipts & disbursement report 1,125 Bid documents (est $155/ad‐approx 16) 2,400 Public meeting notices & other 500 Total legal notices $ 4,025

6451 Legal services‐general $ 50,000

6452 Legal services‐personnel $ 8,000

6453 Legal services‐other $ 3,600

6510 Medical exams $ 1,000

6540 Membership dues EDC ‐ Rockforward program ‐ voucher trade for $5,000 25,000 ACI ‐ NA 8,500 AAAE Legislative Membership 1,750 Chamber of Commerce (Belvidere, Freeport, Loves Park‐Machesney Park, & Rockford) ‐ voucher trade 1,500 National Association of Foreign Trade Zones (NAFTZ) 1,200 McHenry County Economic Development Corp ‐ voucher trade 500 Employers Association 466 National Air Transport Association 400 National Institute of Governmental Purchasing 330 American Association of Airport Executives (AAAE) 275 Illinois Certified Professional Accountants Society (ICPA) 275 Illinois development council 250 American Certified Professional Accountants Society (AICPA) 215 Government Finance Officers Assoc (GFOA) ‐ 1 160 Association of Airport Internal Auditors (AAIA) 125 Airport Purchasing Group (APG) 100 Total membership dues $ 41,046

6600 Other ‐ Contractual services not itemized in other accounts. $ 5,000

48 Finance and Administration Budget Justifications

6640 Payment services Bi‐weekly payroll processing & quarterly reports 6,000 Other 100 Total payment services $ 6,100

6700 Postage Overnight mail 500 Postage, metered (approx $416/mo) 5,000 Other 300 Total postage $ 5,800

6730 Printing Checks, statements, HR forms 1,000 Photographs 500 Business cards 1,500 Miscellaneous 500 Total printing $ 3,500

6751 Telephone‐cellular $ 3,600

6752 Telephone‐local IP phone and internet 5,631 Remote internet connection 580 Back up internet connection 2,500 Answering service 8,400 Total telephone ‐ local $ 17,111

6800 Travel & transportation (airfare/hotel/per diem) Amounts include an estimate of $450/trip airfare, lodging of $170/night and M&I of $65/day for domestic and $2500/airfare, lodging $295 and M&I of $80/day for international. AAAE National meeting (1t) (4n) 1,390 AAAE Chapter (2t) (3n) 2,310 AAAE National meeting/training (4n) 1,390 GFOA/AAAE meeting/training (4n) 1,390 Allegiant air service meeting (3n) 1,150 Other business meetings DC, etc. 5,000 Other business meetings (3t) (2n) 2,760 Director business expense 12,000 Mileage 3,000 Total travel & transportation $ 30,390

6850 Utilities Water 1,000 Sewer 500 Total utilities $ 1,500

COMMODITIES 7100 Building repair Materials for administration and operations building. $ 500

49 Finance and Administration Budget Justifications

7140 Conferences & meetings In‐house lunch/meetings 2,000 Bottled water 560 Employee events 4,000 Wellness program 2,600 Meeting supplies 2,000 Total conferences & meetings $ 11,160

7200 Equipment Computers ‐ replacements 4,500 Refrigerator ‐ breakroom 500 Other 2,000 Total equipment $ 7,000

7380 Other ‐ Commodities not itemized in other accounts. $ 1,000

7580 Software Other 1,500 Total software $ 1,500

7600 Subscriptions Aviation Daily 1,800 Digicast email (AAAE) 300 Internet ‐ Winnebago County 1,260 Other (includes publications) 500 Rockford Register Star 267 Total subscriptions $ 4,127

7750 Supplies‐office Copier & printer paper/fax cartridges 1,750 Office supplies 6,500 Stationery/envelopes for stock 2,000 Binding machine 100 Total supplies‐office $ 10,350

Facility and Maintenance Department Summary The Facilities and Maintenance Department is newly defined with the separation of the Operations staffing and related costs. The department is responsible for maintaining greater than 17.5 million square feet of runways, taxiways, aprons and roadways, including keeping them free of snow, ice and debris, as well as maintaining the airfield lighting system. This also includes maintaining 13 buildings and properties owned by the airport authority as well as a large fleet of vehicles and equipment; directing and coordinating construction projects; and the oversight of the glycol retention/treatment facility.

Following are the strategic objectives outlined in the most recent plan. Department initiatives to move the goals are listed below. Also noted are prior year results.

OBJECTIVES MEASURES TARGETS INITIATIVES

Enhance safety, capacity, and FAA Annual Certification 0 deficiencies marketability w ith the follow ing: improved nav-aids, perimeter roadw ay, Provide a w orld class airport control tow er, rescue and safe and secure airport. firefighting, hydrant fueling.

TSA Audit 0 deficiencies Operational Status 0 hours closed 5 or less OSHA recordable Workplace Safety event annually. Work order system that improves efficiencies and measures future Balance betw een new Make investments based on Improve and upgrade needs. opportunities and maintenance budget, capital, and master infrastructure condition Preventative maintenance checks and of existing infrastructure plan services (PMCS) and scheduled equipment replacement program. Utilization and expansion of 3% reduction in energy usage Energy/Fuel Savings conservation and alternative energy per year. Protect and enhance the opportunities. environment. Comprehensive environmental Environmental w ork plan Completion of an environmental w ork plan. (w ithin 12 mos). plan. Design and landscape plan for stone Kishw aukee Street entrance pillars at Kishw aukee Street entrance. Proactively w ork w ith state/local Enhancement of landside Falcon Road rehabilitation agencies to enable funding for Falcon Airside/street side and facility infrastructure and Rd. rehabilitation. improvements. aesthetics Work w ith local utility providers Plan to evaluate airport projects to to enhance safety and incorporate the efficient placement of operational integrity of RFD. all future utility infrastructures.

Facility and Maintenance Department Summary(con’t)

Goals and Objectives The overall goal of the Facilities and Maintenance Department is to insure that the Chicago Rockford International Airport’s airfield infrastructure and properties are safe and secure for all those using the airport.

 Make available increased, outside training opportunities for key department personnel.  Schedule fact finding visits to other airports to study “best practices”.  Update and review snow clearance procedures to insure safe operation with no airport closures. Annual review of snow and ice control plan, tenant snow removal meeting and UPS snow removal meetings held annually.  Develop and test program designed to study recovery of de‐icing chemicals for possible re‐use.  Maintain a snow removal equipment fleet in a manner that insures exceptional reliability during winter weather operations.  Snow removal planning and coordination with a goal to maintain a safe and open airfield under any winter weather condition. Annual tenant snow removal meeting takes place the 3rd week in October annually. In addition a UPS/RFD snow removal meeting the same time annually.  Complete a pavement marking evaluation and create rotation plan for all future pavement marking changes and updates.  Investigate and evaluate opportunities to save energy costs in all major airport facilities while reducing RFD's carbon footprint. RFD Energy Team meets approximately every other month to evaluate RFD’s energy future.  Implement program to sell of old and unused equipment to contribute to future capital purchases.

Prior Year Results  All staff had training opportunities during the year.  Best practices visit to the Madison, WI regional airport.  Implementation of additional energy upgrade to reduce usage and costs by 10% in the last year.

52 Facilities and Maintenance Department Budget

ACTUAL ACTUAL ACTUAL ACTUAL BUDGET ESTIMATE BUDGET %Chg/FY12 $Chg/FY12 Budget CODE/LINE ITEM, Department 05 FYE08 FYE09 FYE10 FYE11 FYE12 FYE12 FYE13 Budget PERSONNEL SERVICES 5400 Insurance$ 188,484 $ 173,912 $ 181,733 $ 191,480 $ 192,692 $ 208,933 $ 164,956 5450 Overtime 106,309 91,546 84,550 116,196 87,569 101,589 68,612 5451 Double time 46,302 37,506 32,165 53,457 37,423 28,542 28,009 5500 Payroll taxes 85,403 86,894 91,289 95,805 102,937 93,693 83,373 5560 Pension contribution 79,592 80,023 84,414 143,999 116,619 151,092 114,946 5600 Salaries/wages 1,006,542 1,039,126 1,125,516 1,148,567 1,152,266 1,156,072 907,399 5605 Outside labor ‐ 377 ‐ ‐ ‐ ‐ 5610 Pager pay 5,200 5,200 5,200 5,200 5,200 5,200 7,800 5700 Tool allowance 1,800 1,800 1,800 2,350 2,400 2,400 2,400 5750 Training 1,281 3,590 3,335 6,674 11,400 5,518 7,750 5800 Workers compensation insurance 136,793 136,094 171,308 145,705 82,817 100,734 77,809 5900 Uniforms 6,240 6,462 4,737 5,628 5,720 6,031 5,034 5901 Uniforms‐lost,damaged,replaced ‐ ‐ 552 340 200 137 100 5902 Uniforms‐shoe allowance 1,258 596 ‐ ‐ ‐ ‐ ‐ 5903 Uniforms‐other 649 2,566 4,809 5,341 4,700 5,434 7,325 5904 Uniforms‐eyeglasses 555 148 ‐ ‐ ‐ ‐ ‐ TOTAL PERSONNEL SERVICES 1,666,408 1,665,840 1,791,408 1,920,741 1,801,942 1,865,376 1,475,514 (326,428) ‐18.12%

CONTRACTUAL SERVICES 6040 Airfield repair 3,552 ‐ 50 7,686 11,500 1,327 18,000 6100 Building repair 27,236 46,840 24,158 26,353 32,000 32,909 36,000 6140 Conferences & meetings 2,035 82 2,002 903 4,500 3,804 6161 ARFF contractual services 750,375 776,638 812,660 858,724 1,095,011 1,118,792 6162 ARFF training 28,276 6,070 29,876 28,000 28,000 13,695 6201 Energy‐electric 127,860 159,698 168,881 195,555 145,000 174,993 150,000 6202 Energy‐natural gas 52,162 51,581 37,148 36,874 39,900 30,139 37,700 6321 Equip maint‐repairs/services 16,067 17,357 27,514 36,397 19,615 32,416 21,915 6322 Equip maint‐service contracts 117,794 127,443 85,865 91,456 88,134 84,619 65,217 6350 Equipment rental 11,079 23,884 12,963 32,065 21,540 21,381 42,350 6410 Landscaping 2,695 6,905 705 167 6,000 6,183 6,000 6480 Licenses, titles & inspections 867 946 8,996 13,087 14,500 8,989 1,500 6510 Medical exams 1,279 1,276 1,024 1,298 1,000 973 920 6540 Membership dues 260 735 925 1,055 895 920 150 6600 Other 8,071 8,993 28 686 2,000 ‐ 2,000 6670 Permits & testing ‐ 722 623 2,256 1,400 1,298 1,400 6751 Telephone‐cellular 12,473 15,884 14,101 14,647 14,200 14,607 13,440 6752 Telephone‐local 16,252 15,895 12,772 15,472 15,779 24,570 12,750 6753 Telephone‐long distance 1,469 1,511 294 294 ‐ 1 ‐ 6800 Travel & transportation 2,409 2,021 4,274 10,375 9,800 9,809 4,800 6850 Utilities 4,974 9,955 5,379 4,909 5,000 6,942 5,000 6900 Vehicle maintenance 9,585 15,920 12,443 16,286 20,000 14,837 15,000 6950 Waste removal 11,590 9,901 10,296 11,015 11,350 10,489 11,350 TOTAL CONTRACTUAL SERVICES 1,208,360 1,300,257 1,272,977 1,405,560 1,587,124 1,613,690 445,492 (1,141,632) ‐71.93%

COMMODITIES 7100 Building repair 12,412 16,916 14,483 16,175 22,500 13,380 20,000 7140 Conferences & meetings 6,229 4,164 6,040 10,408 5,800 5,788 4,800 7200 Equipment 13,726 19,743 19,164 31,048 26,200 25,890 25,550 7240 Fence/gate 820 576 3,983 5,334 2,600 5,081 2,600 7271 Fuel‐diesel 113,957 75,889 75,118 110,283 82,500 80,008 82,500 7272 Fuel‐unleaded 47,493 41,814 31,191 32,555 38,400 38,653 38,400 7273 Fuel‐other 402 1,140 574 1,275 1,500 322 1,500 7300 Landscaping 3,386 3,119 5,830 1,479 4,500 4,048 4,500 7380 Other 8 195 313 305 1,000 913 1,000 7400 Pavement marking 27,232 63,390 50,206 62,322 55,000 53,631 80,500 7440 Pavement repair 2,656 11,106 4,486 3,460 16,000 3,150 22,000 7500 Raw materials 575 119 781 ‐ 7,200 11,283 7,200 7501 Raw materials‐deicing only 905,439 662,749 352,255 440,148 463,640 254,852 463,640 7540 Signage 8,796 16,632 9,932 1,813 10,000 17,409 12,500 7580 Software 2,904 2,430 2,920 2,240 12,000 5,110 3,000 7600 Subscriptions 2,067 971 1,404 425 925 3,451 2,605 7660 Supplies‐janitorial 4,134 5,821 12,039 4,609 5,000 5,217 5,600 7690 Supplies‐lighting/electrical (airside) 86,559 87,948 34,418 63,880 75,000 77,132 75,000 7720 Supplies‐snow removal wafers, poly‐stee 41,270 92,392 42,174 68,498 52,000 29,532 54,000 7750 Supplies‐office 1,962 2,573 2,128 1,876 2,300 2,334 600 7780 Supplies‐other 2,297 2,185 860 2,849 2,500 3,312 2,500 7782 Supplies‐hardware 5,720 7,111 7,342 9,903 7,000 9,119 7,000 7810 Supplies‐specialty 7,352 15,674 10,026 924 18,500 13,950 7830 Supplies‐steel stock 994 1,334 659 842 2,500 796 3,200 7850 Supplies‐storm sewer/drain ‐ ‐ ‐ 872 1,500 362 1,500 7880 Supplies‐welding 1,325 748 2,776 4,026 5,000 4,313 5,000 7901 Maint‐licensed vehicles 12,108 13,416 13,040 13,666 12,350 11,019 12,350 7902 Maint‐equipment 89,588 77,752 99,286 88,756 89,000 68,695 78,400 TOTAL COMMODITIES 1,401,411 1,227,907 803,425 979,969 1,022,415 748,751 1,017,445 (4,970) ‐0.49%

53 Facilities and Maintenance Department Budget

ACTUAL ACTUAL ACTUAL ACTUAL BUDGET ESTIMATE BUDGET %Chg/FY12 $Chg/FY12 Budget CODE/LINE ITEM, Department 05 FYE08 FYE09 FYE10 FYE11 FYE12 FYE12 FYE13 Budget

OTHER 8400 Glycol retention treatment facility 83,730 114,273 145,644 101,606 89,240 107,684 103,840 8410 Landfill environmental costs 88,746 76,825 167,065 233,061 100,000 353,464 110,000 8415 Property taxes 90,312 74,495 68,630 70,298 64,000 41,077 45,000 TOTAL OTHER 262,788 265,593 381,338 404,966 253,240 502,226 258,840 5,600 2.21%

DEPARTMENT TOTAL $ 4,538,967 $ 4,459,597 $ 4,249,149 $ 4,711,235 $ 4,664,721 $ 4,730,042 $ 3,197,291 $ (1,467,430) ‐31.46%

54 Facilities and Maintenance Department Justifications

PERSONNEL SERVICES 5400 Insurance Health insurance The Authority is partially self funded and estimates for this partial funding are incorporated into the annual costs noted below. The annual cost for the Authority at 80% is as follows by each type of coverage: Employee = $5,504.74/$5,622.59 Employee + Spouse = $10,990.61/$10,985.78 Employee + Children = $10,202.04 Family = $15,687.89/$15,312.86 Dental insurance The annual cost for dental is based on cobra rates as the program is self‐funded. Employee = $293.58 Family = $731.09 Life insurance Life and AD&D insurance is provided to current employees. The benefit is 2.5 times an employee's base salary with life at $.22/$1000 and AD&D at $.05/$1000. Health 147,348 Dental 10,349 Life 7,258 Total employee insurance $ 164,956

5450 Overtime Estimated 1,715 hours of overtime for hourly employees. $ 68,612

5451 Double time Estimated 550 hours of overtime for hourly employees. $ 28,009

5500 Payroll taxes FICA ‐ 6.2% of base wage up to $110,100 63,631 Medicare ‐ 1.45% of base wage 14,881 State unemployment ‐ 2.15% of the first $13,560 4,861 Total payroll taxes $ 83,373

5560 Pension contribution IMRF pension fund ‐ 11.20% $ 114,946

5600 Salaries Includes 16 full time employees and interns $ 907,399

5610 Pager pay (2ee @ $100/wk) $ 7,800

5700 Tool allowance (4ee @ $50/mo) $ 2,400

5750 Training Continuing education 2,500 Environmental 1,000 Energy efficiency 1,250 Other 3,000 Total training $ 7,750

5800 Workers compensation insurance $ 77,809

5900 Uniforms $ 5,034

55 Facilities and Maintenance Department Justifications

5901 Uniforms ‐ lost/damage/replacement $ 100

5903 Uniforms ‐ protective clothing Protective clothing allowance 7,325 Total other uniforms $ 7,325

CONTRACTUAL SERVICES 6040 Airfield repair

Contractual services for repairs to lighting system, pavement surfaces and plumbing sytems. $ 18,000

6100 Building repair Contractual service costs for the repair or modification to various airport owned and maintained buildings including pest control. Overhead door repairs 3,000 Automatic door repairs 2,000 Pest control 4,100 Rug runners/facility entrances 4,000 Bldg security (Term, Prof, Ops) Fire/ADT or other 4,000 Sewer/drainage jetting and pumping 6,700 Other 12,200 Total building repair $ 36,000

6201 Energy‐electric $ 150,000

6202 Energy‐natural gas $ 37,700

6321 Equip maint‐repairs/services HVAC units 7,500 Emergency generators ‐ airfield 2,715 Building automation system 1,200 Radio repairs 1,000 Friction measuring cart 4,500 Other 5,000 Total equipment maintenance‐repairs/services $ 21,915

6322 Equip maint‐service contracts Copy machine usage 192 Weather service 2,000 Telephone system 525 Lawn mowing 33,000 Elevator 4,000 Alarm Monitoring 3,000 Airfield painting evaluation 15,000 Green screen development ‐ energy efficiency tracking page 2,500 Other 5,000 Total equipment maintenance‐service contracts $ 65,217

6350 Equipment rental Aerial 80' lift for apron lighting (UPS) 11,500 Specialty equipment attachments 1,000 Pavement marking removal equipment 24,000 Copy machine 500

56 Facilities and Maintenance Department Justifications

Building maintenace equipment 1,000 Temporary utility meters 200 Fire hydrant 1" water meter (yearly) 200 Other 3,950 Total equipment rental $ 42,350

6410 Landscaping $ 6,000

6480 Licenses, titles, inspections & background checks Yearly license renewal on all applicable vehicles and trailers and any necessary semiannual inspection. Rolling stock yearly license plates 400 Trucks/trailers semi‐annual inspections 150 Title services 300 Fire extinguishing test 650 Total license, titles & inspections $ 1,500

6510 Medical exams $ 920

6540 Membership dues Water Environment Federation 150 Total membership dues $ 150

6600 Other ‐ Contractual costs not itemized in other accounts. $ 2,000

6670 Permits & testing Backflow preventors 900 UPS sanitary lift station certification 500 Total permits & testing $ 1,400

6751 Telephone‐cellular $ 13,440

6752 Telephone‐local IP phone and internet services 12,750 Total telephone‐local $ 12,750

6800 Travel & transportation Energy efficiency 1,800 Other conferences (3ee) 3,000 Total travel & transportation $ 4,800

6850 Utilities Water (8 meters) 3,100 Sewer (5 meters) 1,900 Total utilities $ 5,000

6900 Vehicle maintenance Brake rotors turned Hydraulic pumps/motors/valves/cylinders rebuilt Specialty fabrication/machine work Vehicle oil and fluid analysis Front end alignments Split‐rim tire repairs Total vehicle maintenance $ 15,000

57 Facilities and Maintenance Department Justifications

6950 Waste removal Biohazard 660 Debris and extra dumpster pick‐ups 3,500 Environmental 2,790 Paper recycle 350 Used parts/oil/fuel filters 3,800 Other 250 Total waste removal $ 11,350

COMMODITIES 7100 Building repair Materials used in connection with the maintenance of all Authority owned buildings not covered by tenant leases. $ 20,000

7140 Conferences & meetings Water rental and delivery 1,300 Meals for snow removal crews/special event crews 3,000 Miscellaneous 500 Total conferences & meetings $ 4,800

7200 Equipment Computer replacements (2) 1,000 Other 6,500 Hand tools/small power tools 6,000 Building automation system field components 2,000 Hose 2,700 Hardware 1,400 Signage 2,000 Battery replacement 850 Wildlife expendables ‐ cracker shells, caps, pyro shells 1,600 Wildlife depredation tools 1,500 Total equipment $ 25,550

7240 Fence/gate ‐ perimeter fence and gate supplies $ 2,600

7271 Fuel‐diesel ‐ 25,000g @ 3.3/g $ 82,500

7272 Fuel‐unleaded ‐ 12,000g @ 3.2/g $ 38,400

7273 Fuel‐other $ 1,500

7300 Landscaping

Supplies associated with turf maintenance of all Authority grounds not covered in tenant lease. $ 4,500

7380 Other ‐ Costs of commodities not itemized in other accounts. $ 1,000

7400 Pavement marking Pavement marking paint 42,000 Type I and III glass beads 28,000 Pre‐formed thermo plastic ‐ non‐movement areas 7,500 Other 3,000

58 Facilities and Maintenance Department Justifications

Total pavement marking $ 80,500

7440 Pavement repair Includes joint sealer, primers, asphalt, stone, backing rod, rubber seals and other materials directly associated with pavement repair. $ 22,000

7500 Raw materials Sand 1,700 Gravel 5,500 Total raw materials $ 7,200

7501 Raw materials‐deicing only Potassium acetate 190,000 Road salt 9,120 Other FAA approved deicing material 25,000 Urea 234,000 Sidewalk ice melt 5,520 Total raw materials‐deicing only $ 463,640

7540 Signage Repair & replacement of signage for buildings, infield roadways and airfield directional inserts. $ 12,500

7580 Software Includes upgrades to maintenance related software. 3,000 Total software $ 3,000

7600 Subscriptions Rockford Register Star 200 Internet ‐ Winnebago County 1,680 Other 725 Total subscriptions $ 2,605

7660 Supplies‐janitorial Consumable products 3,800 Cleaners 1,000 Strippers/waxes 200 Mop heads/brushes/brooms/bags/etc 600 Total supplies‐janitorial $ 5,600

7690 Supplies‐lighting/electrical (airside) Repair and replacement of existing runway, taxiway, and apron lighting systems. $ 75,000

7720 Supplies‐snow removal wafers/poly‐steel blades Broom core replacements for snow removal equipment. $ 54,000

7750 Supplies‐office Office supplies 600 Total supplies‐office $ 600

7780 Supplies‐other Other supplies not itemized in other accounts $ 2,500

7782 Supplies‐hardware (expendable supplies) $ 7,000

59 Facilities and Maintenance Department Justifications

7830 Supplies‐steel stock $ 3,200

7850 Supplies‐storm sewer/drain Drain tile, culverts, flares, storm drain covers, plates and other replacement items and emergency repair of airport infrastructure. $ 1,500

7880 Supplies‐welding $ 5,000

7901 Maintenance‐licensed vehicles Supplies for approximately 15 vehicles. $ 12,350

7902 Maintenance‐equipment Supplies for repair of Authority equipment. $ 78,400

OTHER 8400 Glycol retention treatment facility Electric 43,600 Testing 5,800 Equipment service and repairs 8,500 Chemicals 22,500 Wireless monitoring fees 1,140 Consulting/Engineering/Environmental 8,500 Building automation system field components 1,600 Supplies 1,000 Oil water separator inspection and maintenance 9,800 Permit and pest control 1,400 Total glycol retention treatment facility $ 103,840

8410 Landfill and environmental costs ‐ legal and engineering costs $ 110,000

8415 Property taxes Property taxes paid for Authority owned properties including land and improvements. $ 45,000

Operating Department Summary The Operations Department is a new department that has the overall responsibility for the safe and secure operation of the airfield and airport. This includes monitoring and ensuring compliance with all FAA, TSA, Federal, State and Local regulatory requirements; and that all air carriers, general aviation aircraft and airport tenants operate in a safe manner; administrating the airport’s badging, background check and security systems; wildlife control, inspection and oversight of all fueling operations and numerous other responsibilities as defined by FAR139 and TSA 1542 regulations.

The department is also responsible for coordinating with the Facilities and Maintenance Department for maintenance and snow removal performed on and around the runways, taxiways, and ramps.

OBJECTIVES MEASURES TARGETS INITIATIVES

90% of all new hires rate Performance appraisals satisfactory or better in the Performance appraisals done annually Attract and retain a first 6 mos. of employment and quarterly during first year of qualified and w orkforce. Turnover rate at 8% or less position. Employee turnover annually. Identify organizational w ide training Professional development and priorities to improve job skills and Promote learning and Hours of training or or training opportunities and know ledge. grow th professional development participation. Create and implement training/ professional development program. Ensure safe operational status during FAA Annual Certification 0 deficiencies times of severe w eather. Enhance safety, capacity, and Provide a w orld class TSA Audit 0 deficiencies marketability w ith the f ollow ing: safe and secure airport. Operational Status 0 hours closed improved nav-aids, perimeter roadw ay, airport control tow er, rescue and 5 or less OSHA recordable Workplace Safety firefighting, hydrant fueling. event annually. Implement SMS (Safety Still being developed based on FAA SMS Compliance SMS Compliance in 6-12 mos. Management System) regulations.

Goals and Objectives The overall goal of the Operations Department is to maintain the safety and security of the Chicago Rockford International Airport for all of our users. Furthermore the department will adhere to the highest level of customer service and compliance with Part 139 of the FAA regulations, (and all TSA 1542 regulations) consistent with operating a world class commercial airport.

 Create an all‐inclusive tenant symposium to better address tenant concerns and increase communication between all parties.  Provided National Incident Management System (NIMS) and Incident Command System (ICS) training to all Operations staff.  Assist RFD administration staff in the revision of the airport Rules and Regulations.  Begin preliminary implementation of Safety Management System (SMS) at RFD.  Make available increased, outside training opportunities for key department personnel.  Review, enhance, and update all RFD Standard Operating Procedures (SOPS).  Schedule fact finding visits to other airports to study “best practices”.  Host other airports as they visit RFD to discuss "best practices”.

Operating Department Summary(con’t)  Complete annual FAA certification process with no discrepancies.  Continue to monitor all policies to insure RFD remains in compliance with FAR 139, all TSA 1542 regulatory requirements as well as appropriate federal, state and local regulations as they relate to airport operations.  Snow removal planning and coordination with a goal to maintain a safe airfield under any winter weather condition. Safety is the number one goal, operational status is secondary.  Monitor and maintain the RFD Airport Certification Manual and update as necessary.  Increase awareness and training of all personnel operating in the movement area, with the ultimate goal of eliminating runway incursions/vehicle deviations.

Prior Year Results  RFD never closed and maintained safety throughout the entire winter season.  All staff had training opportunities during the year.  New draft of the Airport Security Program written, TSA approval during FY13.

62 Operations Department Budget

BUDGET CODE/LINE ITEM, Department 06 FYE13 PERSONNEL SERVICES 5400 Insurance$ 63,538 5450 Overtime 7,576 5451 Double time 5,006 5500 Payroll taxes 28,852 5560 Pension contribution 30,742 5600 Salaries/wages 329,394 5750 Training 16,400 5800 Workers compensation insurance 25,313 5900 Uniforms 2,202 5901 Uniforms‐lost,damaged,replaced 50 5903 Uniforms‐other 1,600 TOTAL PERSONNEL SERVICES 510,672

CONTRACTUAL SERVICES 6140 Conferences & meetings 4,500 6161 ARFF contractual services 1,142,573 6162 ARFF training 28,000 6322 Equip maint‐service contracts 2,717 6350 Equipment rental 500 6480 Licenses, titles & inspections 10,500 6510 Medical exams 80 6540 Membership dues 1,295 6751 Telephone‐cellular 4,200 6752 Telephone‐local 14,540 6800 Travel & transportation 5,000 TOTAL CONTRACTUAL SERVICES 1,213,905

COMMODITIES 7140 Conferences & meetings 1,000 7200 Equipment 4,400 7580 Software 11,800 7600 Subscriptions 840 7750 Supplies‐office 2,600 7810 Supplies‐specialty 21,000 TOTAL COMMODITIES 41,640

DEPARTMENT TOTAL $ 1,766,217

63 Operations Department Justifications

PERSONNEL SERVICES 5400 Insurance Health insurance The Authority is partially self funded and estimates for this partial funding are incorporated into the annual costs noted below. The annual cost for the Authority at 80% is as follows by each type of coverage: Employee = $5,504.74/$5,622.59 Employee + Spouse = $10,990.61/$10,985.78 Employee + Children = $10,202.04 Family = $15,687.89/$15,312.86 Dental insurance The annual cost for dental is based on cobra rates as the program is self‐funded. Employee = $293.58 Family = $731.09 Life insurance Life and AD&D insurance is provided to current employees. The benefit is 2.5 times an employee's base salary with life at $.22/$1000 and AD&D at $.05/$1000. Health 57,592 Dental 3,571 Life 2,375 Total employee insurance $ 63,538

5450 Overtime Estimated 400 hours of overtime for hourly employees. $ 7,576

5451 Double time Estimated 256 hours of overtime for hourly employees. $ 5,006

5500 Payroll taxes FICA ‐ 6.2% of base wage up to $110,100 21,529 Medicare ‐ 1.45% of base wage 5,035 State unemployment ‐ 2.15% of the first $13,560 2,287 Total payroll taxes $ 28,852

5560 Pension contribution IMRF pension fund ‐ 11.20% $ 30,742

5600 Salaries Includes 6 full time employees and interns $ 329,394

5750 Training FAA Part 139 1,200 TSA 1542/1544 1,200 Continuing education 2,750 Airport security coordinator 1,250 Advanced degrees ‐ staff (3) 10,000 Total training $ 16,400

5800 Workers compensation insurance $ 25,313

5900 Uniforms $ 2,202

5901 Uniforms ‐ lost/damage/replacement $ 50

5903 Uniforms ‐ protective clothing Protective clothing allowance 1,600

64 Operations Department Justifications

Total other uniforms $ 1,600

CONTRACTUAL SERVICES 6140 Conferences & meetings Annual tenant meetings for NPDES/Part 139/ TSA1542 $ 4,500

6161 ARFF contractual services Contract with the City of Rockford for all ARFF services. $ 1,142,573

6162 ARFF training Annual live burn training, simulator & fuel & related expenses 23,000 Training equipment, CDs 1,000 ARFF training 1,500 Conferences (5n, 2ee) 2,000 Other 500 Total ARFF training $ 28,000

6322 Equip maint‐service contracts Copy machine usage 192 Weather service 2,000 Telephone system 525 Total equipment maintenance‐service contracts $ 2,717

6350 Equipment rental Copy machine 500 Total equipment rental $ 500

6480 Licenses, titles, inspections & background checks Finger printing and security threat assessments 10,500 Total license, titles & inspections $ 10,500

6510 Medical exams $ 80

6540 Membership dues AAAE 1,100 Aircraft rescue & fire 125 Great lakes chapter AAAE 70 Total membership dues $ 1,295

6751 Telephone‐cellular $ 4,200

6752 Telephone‐local IP phone and internet services 3,380 Crash phone and tower 11,160 Total telephone‐local $ 14,540

65 Operations Department Justifications

6800 Travel & transportation Airport security coordinator 1,100 Security system training (travel, lodge, meals) 500 ASOS, wildlife and facility management 3,400 Total travel & transportation $ 5,000

COMMODITIES 7140 Conferences & meetings Annual 139 table top 500 Meals for snow removal crews/special event crews 500 Total conferences & meetings $ 1,000

7200 Equipment Computer replacements (3) 1,900 Digital cameras (2) 600 Security system surveillance cameras 1,900 Total equipment $ 4,400

7580 Software ATTN Digicast training 2,000 ELS Part 139 System ‐ t3 9,800 Total software $ 11,800

7600 Subscriptions Internet ‐ Winnebago County 840 Total subscriptions $ 840

7750 Supplies‐office ‐ badges etc. Badging supplies 1,400 Office supplies 1,200 Total supplies‐office ‐badges etc. $ 2,600

7810 Supplies‐specialty ARFF fire suppresant chemical $ 21,000

Marketing Department Summary

The Marketing Department is responsible for ensuring the consistency of messaging to consumers and businesses regarding RFD’s high‐value, low cost, hassle‐free experience. This message is used to improve RFD’s standing in the markets that it operates. The markets that are targeted by RFD for continued development include air service for scheduled airlines, air charters, and air cargo. The Marketing Objectives are outlined below. Department initiatives to move the goals are listed below. Also noted are prior year results.

OBJECTIVES MEASURES TARGETS INITIATIVES

90% of all new hires rate Performance appraisals satisfactory or better in the Performance appraisals done annually Attract and retain a first 6 mos. of employment and quarterly during first year of qualified and w orkforce. Turnover rate at 8% or less position. Employee turnover annually. Identify organizational w ide training Professional development and priorities to improve job skills and Promote learning and Hours of training or or training opportunities and know ledge. grow th professional development participation. Create and implement training/ professional development program. Develop collaborative opportunities for promotion, education and recruitment through various businesses and Excel as a community Participation and collaboration Continue and/or increase community events. partner for the region. in the community. participation. Go Global, Air Show . Ice Sculpting Contest (clean snow ), Cub Scouts, College/High School Interns. Provide exceptional and Surveys show meet or exceed Periodic customer satisfaction surveys. continuously improving Customer satisfaction customer satisfaction. Establish baseline for improvement. customer service.

The overall marketing budget is a cost center based off of support of four main strategic areas. Those areas are Air Service Development, Cargo Service Development, and Community Involvement. The Marketing Department supports each of these strategic areas by providing planning and implementation of marketing tactics to meet the objectives set forth in the Strategic Plan. Attached is the first draft of the proposed marketing plan for FY 2013. Below is a narrative on each strategic area and summaries of the marketing plans to reach the strategic goals for FY 2013.

Marketing will continue to collaborate with other Rockford‐Area entities and participate in community‐ related events. Such events include On‐The‐Waterfront, RPD’s Snow Sculpting Contest, and various parades. In addition, we will work with local sports teams to show support for the community and work with local businesses to enhance the quality of life in Rockford. We have planned on working with local secondary education institutions to promote aviation‐based jobs. We are also involved in Go Global, which continues to shine light on Rockford as a destination for businesses in a global economy.

A Community Involvement strategy defines the long‐term direction and systematic action required to achieve a company’s goals in meeting both the needs of its communities and achieving business objectives.

• Enhanced reputation • Improved stakeholder relations • Building credibility and trust

Marketing Department Summary(con’t)

• Demonstrating core competencies and innovation potential • Exercising leadership • Enhanced brand image and preference, strengthened brand value • Increased customer purchase intentions, retention, and loyalty • Improved employee attraction/retention • Expansion to new growth markets • Creating a distinct niche for your company • Contributing to long‐term value creation for the company

Goals and Objectives Enhance and grow air service at RFD and to effectively market RFD to the region.

 Think creatively and implement unique, yet effective marketing campaigns that consistently engage the community and region.  Perform regular research and analysis of RFD activity and airline performance through surveying, polling, and industry statistical analysis.  Explore and create new partnerships that supplement our marketing plan to produce results and save costs for the airport.  Increase MilesAhead membership by 15%.  Increase revenue production at Main Terminal through advertising revenues.

Prior Year Results  Marketing results continue to show growth in usage of social media: MilesAhead, Facebook, Twitter and YouTube.  5% growth in MilesAhead during our two week FlyRFD.com Suitcase Hunt encouraging use of FlyRFD.com.

68 Marketing and Communications Department Budget

ACTUAL ACTUAL ACTUAL ACTUAL BUDGET ESTIMATE BUDGET $ Chg/FY12 %Chg/FY12 CODE/LINE ITEM, Department 07 FYE08 FYE09 FYE10 FYE11 FYE12 FYE12 FYE13 Budget Budget PERSONNEL SERVICES 5400 Insurance $ 18,421 $ 10,732 $ 6,564 $ 19,657 $ 13,277 $ 14,419 $ 11,972 5450 Overtime ‐ 2,117 1,440 194 378 ‐ 378 5500 Payroll taxes 3,781 5,803 6,178 6,757 5,709 4,782 5,251 5560 Pension contribution 3,659 3,410 3,499 9,316 5,648 7,644 6,208 5600 Salaries/wages 54,999 74,116 81,918 100,052 69,212 69,632 62,627 5750 Training 500 4,100 ‐ 199 1,000 ‐ ‐ 5800 Workers compensation insurance 1,293 375 497 656 138 36 163 TOTAL PERSONNEL SERVICES 82,653 100,653 100,096 136,830 95,362 96,512 86,598 (8,764)$ ‐9.19%

CONTRACTUAL SERVICES 6021 Ad‐Television 134,703 118,746 139,053 103,736 42,000 42,183 28,000 6022 Ad‐Radio 39,194 50,739 97,779 101,289 27,000 24,582 51,000 6023 Ad‐Billboards 63,843 50,142 9,070 25,124 7,500 6,508 2,500 6024 Ad‐Direct 2,500 600 15,826 11,899 32,000 1,611 35,000 6025 Ad‐Promotions/sponsorships/events 12,565 17,694 14,049 8,246 92,000 72,218 46,000 6026 Ad‐Print 111,074 116,410 173,551 227,144 107,000 98,874 128,000 6027 Ad‐Internet/web 66,000 55,673 59,500 6120 Charter program 5,310 ‐ ‐ ‐ 6121 MilesAhead program 132,289 74,159 32,057 86,676 48,000 25,769 27,500 6140 Conferences & meetings ‐ 102 101,660 117 4,145 2,627 3,250 6145 Air service start up ‐ 500 ‐ ‐ 15,000 ‐ 6150 Revenue guarantee 821,678 1,092,254 45,356 21,750 220,200 755,910 6160 Consulting services 62,716 65,471 64,220 61,461 147,000 125,846 148,500 6510 Medical exams ‐ 69 ‐ ‐ ‐ 45 ‐ 6540 Membership dues 35 ‐ ‐ 295 545 520 2,295 6600 Other ‐ 526 ‐ 70 1,000 109 1,000 6700 Postage 112 ‐ 127 160 250 ‐ 250 6730 Printing 21,645 19,688 16,008 5,459 18,500 6,505 22,000 6751 Telephone‐cellular ‐ ‐ ‐ 1,505 1,400 1,458 1,020 6752 Telephone‐local ‐ ‐ ‐ ‐ 2,575 2,288 450 6753 Telephone‐long distance 305 194 202 156 ‐ 102 ‐ 6800 Travel & transportation 1,477 543 188 45 2,035 1,243 3,570 TOTAL CONTRACTUAL SERVICES 1,404,136 1,607,837 709,146 660,443 834,150 1,224,070 559,835 (274,315)$ ‐32.89%

COMMODITIES 7140 Conferences & meetings 4,590 257 63 73 6,000 422 3,000 7200 Equipment 186 1,141 341 2,357 1,000 441 800 7380 Other 13 336 120 ‐ 1,000 110 1,000 7600 Subscriptions 58 ‐ ‐ 1,845 500 231 670 7750 Supplies‐office 10 104 180 60 750 14 750 7796 Supplies‐promotional 17,118 7,804 11,446 6,288 11,500 12,074 11,000 TOTAL COMMODITIES 21,975 9,642 12,150 10,623 20,750 13,292 17,220 (3,530)$ ‐17.01%

DEPARTMENT TOTAL $ 1,508,764 $ 1,718,132 $ 821,391 $ 807,896 $ 950,262 $ 1,333,875 $ 663,653 (286,609)$ ‐30.16%

69 Marketing and Communications Budget Justifications

PERSONNEL SERVICES 5400 Insurance The Authority is partially self funded and estimates for this partial funding are incorporated into the annual costs noted below. The annual cost for the Authority at 80% is as follows by each type of coverage: Employee = $5,504.74/$5,622.59 Employee + Spouse = $10,990.61/$10,985.78 Employee + Children = $10,202.04 Family = $15,687.89/$15,312.86 Dental insurance The annual cost for dental is based on cobra rates as the program is self‐funded. Employee = $293.58 Family = $731.09 Life insurance Life and AD&D insurance is provided to current employees. The benefit is 2.5 times an employee's base salary with life at $.22/$1000 and AD&D at $.05/$1000. Health 10,971 Dental 555 Life 446 Total employee insurance $ 11,972

5450 Overtime Estimated 21 hours of overtime for interns. $ 378

5500 Payroll Taxes FICA ‐ 6.2% of base wage up to $110,100 3,972 Medicare ‐ 1.45% of base wage 929 State unemployment ‐ 2.15% of the first $13,560 350 Total payroll taxes $ 5,251

5560 Pension contribution IMRF pension fund ‐ 11.20% $ 6,208

5600 Salaries Includes 1 full time employee and seasonal interns. $ 62,627

5800 Workers compensation insurance $ 163

CONTRACTUAL SERVICES Advertising Advertising associated with airline, charter and/or cargo service 6021 Television $ 28,000

6022 Radio $ 51,000

6023 Billboards $ 2,500

6024 Direct $ 35,000

6025 Promotions/Sponsorships/Events $ 46,000

6026 Print $ 128,000

6027 Internet/Web $ 59,500

70 Marketing and Communications Budget Justifications

6121 Consumer/Travel Agent Incentives $ 27,500

6140 Conferences & meetings Airports council international 1,250 International entertainment group sponsorship meeting 2,000 Total conferences & meetings $ 3,250

6160 Consulting services Ad design and production 30,500 Design and development ‐ annual report 3,000 Website update & production 27,000 Planning 2,500 Cargo promotional material design and website changes 10,000 Email blasting 6,000 Media Relations 60,000 Photography and video services 9,500 Total consulting services $ 148,500

6540 Membership dues American marketing association 295 Other 2,000 Total membership dues $ 2,295

6600 Other ‐ Contractual services not itemized in other accounts. $ 1,000

6700 Postage Mailings, travel agents & charter $ 250

6730 Printing Banners 3,250 Invitations/cards 1,250 RFD brochure reprint 3,000 Cargo promotional materials 2,500 Signage 3,000 Rack cards 1,500 Annual report 3,500 FTZ materials 1,000 Other 3,000 Total printing $ 22,000

6751 Telephone‐cellular $ 1,020

6752 Telephone‐local/h‐s internet $ 450

6800 Travel & transportation Amounts include an estimate of $450/trip airfare, lodging of $170/night and M&I of $65/day for domestic.

Airport council (3n) 1,570 Other 1,500 Mileage 500 Total travel & transportation $ 3,570

71 Marketing and Communications Budget Justifications

COMMODITIES 7140 Conferences & meetings In‐house luncheon meetings 1,000 Special events(not including Airfest) 2,000 Total conferences & meetings $ 3,000

7200 Equipment $ 800

7380 Other ‐ Commodities not itemized in other accounts. $ 1,000

7600 Subscriptions Air service/marketing publications 250 Internet ‐ Winnebago County 420 Total subscriptions $ 670

7750 Supplies‐office Shipping via UPS $ 750

7796 Supplies‐promotional Promotional items endorsing airport awareness and customer service. Shirts, hats, pens, coasters, lanyards, coloring books, etc 9,000 Tenant gifts 2,000 Total supplies‐promotional $ 11,000

Terminal Services Department Summary

The Terminal Services Department is responsible for the customer from the parking lot to the jet way. In 2002, there were virtually no passengers, now it is estimated that approximately 200,000 people will utilize the terminal in the next year. This not only increases the maintenance costs, but also the personnel cost associated with an exceptional traveling experience.

Following are the objectives aligned with our Terminal Services. Department initiatives to move the goals are listed below. Also noted are prior year results.

OBJECTIVES MEASURES TARGETS INITIATIVES

Grow th in diversified revenue Greater than 80% of revenues Monitor annual report, schedule of Revenues sources. from sources other than UPS. major revenue sources.

90% of all new hires rate Performance appraisals satisfactory or better in the Performance appraisals done annually Attract and retain a first 6 mos. of employment and quarterly during first year of qualified and w orkforce. Turnover rate at 8% or less position. Employee turnover annually. Identify organizational w ide training Professional development and priorities to improve job skills and Promote learning and Hours of training or or training opportunities and know ledge. grow th professional development participation. Create and implement training/ professional development program. Develop collaborative opportunities for promotion, education and recruitment through various businesses and Excel as a community Participation and collaboration Continue and/or increase community events. partner for the region. in the community. participation. Go Global, Air Show . Ice Sculpting Contest (clean snow ), Cub Scouts, College/High School Interns. Provide exceptional and Surveys show meet or exceed Periodic customer satisfaction surveys. continuously improving Customer satisfaction customer satisfaction. Establish baseline for improvement. customer service. Provide a w orld class 5 or less OSHA recordable Workplace Safety safe and secure airport. event annually. Utilization and expansion of Protect and enhance the 3% reduction in energy usage Energy/Fuel Savings conservation and alternative energy environment. per year. opportunities.

Goals and Objectives To provide for exceptional customer service in RFD’s high‐value, low cost, hassle‐free environment.

 Maintain a high level of customer service and care.  Maintain and improve tenant relations by monthly meeting with all terminal tenants.  Beautify all terminal spaces to enhance the passenger experience.  Add more entertainment in gate areas such as more TV's, electronic games, etc.  An Energy Audit was performed to identify further areas for energy conservation and increased efficiencies. In concert with the RFD Energy Committee, those recommendations will be prioritized for implementation and sources of funding will be sought out.

Terminal Services Department Summary(con’t)

 Currently, a study is underway to determine costs, utilization of manpower and current revenue. The findings of this study will be used to increase efficiencies of manpower in terms of ongoing janitorial, customer service and snow removal functions during FY2013.  Reconfigure main floor ticket counters to accommodate additional airline operator and to decrease waiting times for check in.  Work with TSA administration to enhance security checkpoint and scheduling to decrease waiting time particularly during heavy flight times.  Reconfigure second floor boarding area check in podiums and seating to accommodate additional passenger traffic that will start in December.  Work with the existing food vendor to improve services and projects for the passengers.  Investigate new revenue opportunities for the terminal.

Prior Year Results  An outdoor patio, adjacent to the east side of the terminal, will be completed and ready for use this fall. The addition of the outdoor patio will provide an additional convenience for passengers awaiting their flights and provide enhanced customer experience for all individuals using the terminal.  Aircraft lead in lines, stop bars, Jet Bridge stow boxes and Ground Support Equipment (GSE) parking areas will be redone and enhanced to increase aircraft operation and efficiency on the terminal ramp.  Seal coating and restriping of the terminal parking lots to be started during the fall season and completed during the spring season to enhance the appearance of the lots and to prolong the life of the asphalt.

74 Terminal Services Department Budget

ACTUAL ACTUAL ACTUAL ACTUAL BUDGET ESTIMATE BUDGET $ Chg/FY12 %Chg/FY12 CODE/LINE ITEM, Department 08 FYE08 FYE09 FYE10 FYE11 FYE12 FYE12 FYE13 Budget Budget PERSONNEL SERVICES 5400 Insurance$ 38,388 $ 43,713 $ 47,871 $ 50,641 $ 52,523 $ 50,718 $ 23,848 5450 Overtime 19,073 21,606 19,610 19,654 15,116 14,127 10,395 5451 Double time 12,405 10,929 11,407 16,214 9,037 11,646 8,883 5500 Payroll taxes 14,629 18,429 19,687 18,939 21,377 15,457 10,884 5560 Pension contribution 13,632 15,622 17,670 27,304 23,126 22,045 14,679 5600 Salaries/wages 176,952 230,013 232,295 225,837 237,196 192,432 109,362 5750 Training 317 330 169 2,120 4,000 ‐ 5800 Workers compensation insurance 14,218 21,642 27,309 23,722 15,338 16,804 11,206 5900 Uniforms 677 1,005 1,034 1,144 1,144 957 944 5901 Uniforms‐lost,damaged,replaced ‐ ‐ 22 65 100 49 100 5903 Uniforms‐other 477 692 465 656 600 676 600 TOTAL PERSONNEL SERVICES 290,768 363,981 377,541 386,294 379,556 324,910 190,900 (188,655)$ ‐49.70%

CONTRACTUAL SERVICES 6100 Building repair 3,370 6,753 1,754 16,774 15,000 18,504 22,000 6140 Conferences & meetings 4,592 6,124 1,982 75 2,500 32 6201 Energy‐electric 170,015 189,687 184,546 176,337 151,000 144,487 140,000 6202 Energy‐natural gas 25,380 28,041 20,734 19,762 20,000 13,605 17,500 6320 Equipment maintenance ‐ 474 ‐ ‐ ‐ ‐ ‐ 6321 Equip maint‐repairs/services 2,505 26,218 44,756 52,561 14,450 32,902 41,450 6322 Equip maint‐service contracts 24,806 22,068 37,412 41,068 48,530 40,027 52,840 6350 Equipment rental 2,206 1,330 940 4,022 4,000 1,145 4,000 6410 Landscaping 8,225 4,083 392 5,181 6,500 5,170 12,500 6510 Medical exams 22 146 304 5 300 791 500 6540 Membership dues 35 35 ‐ ‐ 250 ‐ ‐ 6600 Other ‐ 36 ‐ 101 2,000 504 1,580 6700 Postage 115 ‐ ‐ ‐ ‐ ‐ ‐ 6751 Telephone‐cellular 1,319 2,789 3,240 3,610 2,570 3,079 2,250 6752 Telephone‐local 7,201 6,734 7,083 11,131 8,918 16,343 13,580 6753 Telephone‐long distance ‐ 2 ‐ 21 ‐ 0 6800 Travel & transportation 832 134 ‐ 1,555 4,500 196 6800 Customer care/customer service ‐ 5,109 1,639 117 2,000 1,364 ‐ 6850 Utilities 3,082 5,951 4,513 4,777 5,800 5,293 5,800 6950 Waste removal 4,792 5,636 111,193 103,625 117,190 84,072 91,000 TOTAL CONTRACTUAL SERVICES 258,497 311,350 420,489 440,721 405,508 367,516 405,000 (508)$ ‐0.13%

COMMODITIES 7100 Building repair 22,127 8,128 50,830 37,194 22,000 14,434 24,000 7140 Conferences & meetings 1,162 1,231 872 830 3,910 923 1,400 7200 Equipment 10,512 5,615 5,472 11,543 8,000 13,458 8,500 7300 Landscaping 2,523 5,436 7,303 10,022 10,000 12,685 3,500 7380 Other 1,858 678 242 2,174 2,000 1,076 3,000 7540 Signage 8,189 2,947 2,053 748 5,000 3,666 7580 Software ‐ ‐ 4,473 70 ‐ ‐ ‐ 7600 Subscriptions 350 ‐ 385 10,179 10,200 9,226 255 7660 Supplies‐janitorial 16,068 18,435 14,961 7,841 11,990 18,818 19,800 7750 Supplies‐office 352 1,368 1,782 2,160 2,000 3,203 7780 Supplies‐other 2,015 2,205 4,953 6,164 3,500 498 TOTAL COMMODITIES 65,156 46,043 93,326 88,925 78,600 77,988 60,455 (18,145)$ ‐23.09%

DEPARTMENT TOTAL $ 614,421 $ 721,374 $ 891,356 $ 915,941 $ 863,664 $ 770,414 $ 656,355 (207,308)$ ‐24.00%

75 Terminal Services Budget Justifications

PERSONNEL SERVICES 5400 Insurance The Authority is partially self funded and estimates for this partial funding are incorporated into the annual costs noted below. The annual cost for the Authority at 80% is as follows by each type of coverage: Employee = $5,504.74/$5,622.59 Employee + Spouse = $10,990.61/$10,985.78 Employee + Children = $10,202.04 Family = $15,687.89/$15,312.86 Dental insurance The annual cost for dental is based on cobra rates as the program is self‐funded. Employee = $293.58 Family = $731.09 Life insurance Life and AD&D insurance is provided to current employees. The benefit is 2.5 times an employee's base salary with life at $.22/$1000 and AD&D at $.05/$1000. Health 21,596 Dental 1,397 Life 855 Total employee insurance $ 23,848

5450 Overtime Estimated 400 hours of overtime for hourly employees. $ 10,395

5451 Double time Estimated 256 hours of overtime for hourly employees. $ 8,883

5500 Payroll taxes FICA ‐ 6.2% of base wage up to $110,100 8,126 Medicare ‐ 1.45% of base wage 1,900 State unemployment ‐ 2.15% of the first $13,560 858 Total payroll taxes $ 10,884

5560 Pension contribution IMRF pension fund ‐ 11.20% $ 14,679

5600 Salaries 4 full time employees 109,362 Total salaries $ 109,362

5800 Workers compensation insurance $ 11,206

5900 Uniforms $ 944

5901 Uniforms ‐ lost/damage/replacement $ 100

5903 Uniforms ‐ protective clothing $ 600

CONTRACTUAL SERVICES 6100 Building repair Structural repair of administration building. $ 22,000

6201 Energy‐electric ‐ terminal $ 140,000

76 Terminal Services Budget Justifications

6202 Energy‐natural gas ‐ terminal $ 17,500

6321 Equip maint‐repairs/services HVAC 12,500 Installation/Replacement of field components w/HVAC 14,000 Jet Bridges 4,500 Door repair 2,500 Quarterly terminal window cleaning 6,000 Other 1,950 Total equipment maintenance ‐ repairs/service $ 41,450

6322 Equip maint‐service contracts Escalator maintenance contract 11,354 Elevator 4,000 Jetbridge preventive maintenance contract 7,800 Water softener service 3,350 Common use system maintenance contract 17,376 Security system 3,800 Pest control 1,260 Telephone system 1,050 Sanitizer service 2,000 Wheel chair maintenance 350 Other 500 Total equipment maintenance‐service contracts $ 52,840

6350 Equipment rental High lift/boom 2,000 Other 2,000 Total equipment rental $ 4,000

6410 Landscaping General landscaping needs 8,500 Terminal fertilizing and broadleaf control 4,000 Total landscaping $ 12,500

6510 Medical exams $ 500

6600 Other ‐ Contractual services not itemized in other accounts. $ 1,580

6751 Telephone‐cellular $ 2,250

6752 Telephone‐local IP telephone and internet service 11,580 Back up service 2,000 Total telephone ‐ local $ 13,580

6850 Utilities Water 2,900 Sewer 2,900 Total utilities $ 5,800

6950 Waste removal Debris and extra dumpster pick‐ups 5,000

77 Terminal Services Budget Justifications

International rubbish removal 85,000 Other ‐ line cleaning 1,000 Total waste removal $ 91,000

COMMODITIES 7100 Building repair Materials used in connection with the maintenance of terminal building areas not covered by tenant leases. $ 24,000

7140 Conferences & meetings Water rental and delivery 900 Miscellaneous 500 Total conferences & meetings $ 1,400

7200 Equipment Power tools and equipment 2,500 Hand tools, snow shovels, etc 1,400 Stanchions 1,100 Other 3,500 Total equipment $ 8,500

7300 Landscaping Supplies associated with turf maintenance of terminal area. $ 3,500

7380 Other ‐ Costs of commodities not itemized in other accounts. $ 3,000

7600 Subscriptions Internet subscription‐ Winn Co. $ 255

7660 Supplies‐janitorial Consumable products 12,500 Cleaners 3,200 Strippers/waxes 600 Mop heads/brushes/brooms/bags/etc 3,500 Total supplies‐janitorial $ 19,800

AirFest Department Summary The AirFest Department is responsible for the overall development and implementation of one of the Midwest’s largest events. AirFest is considered a promotional event for the airport, with the added benefit of supporting the community’s quality of life with another family‐oriented event for the region. The department oversees and implements the operational, promotional, and financial aspects of Rockford AirFest. Although a component of the greater Airport marketing mix, it was necessary to separately identify the related costs of the event from the Air Service Marketing.

Following is the objective for the AirFest. Department initiatives to move the goals are listed below. Also noted are prior year results.

OBJECTIVES MEASURES TARGETS INITIATIVES

Develop collaborative opportunities for promotion, education and recruitment through various businesses and Excel as a community Participation and collaboration Continue and/or increase community events. partner for the region. in the community. participation. Go Global, Air Show . Ice Sculpting Contest (clean snow ), Cub Scouts, College/High School Interns.

Goals and Objectives Provide a high quality, high value family‐friendly event for the regional community and a marketing opportunity to promote RFD in the most cost effective manner.

 Produce an event that resonates with the region and allows for patrons to experience RFD and results in a breakeven or better financial position.  Operate an event that is safe for the performers and patrons.  Establish relationships with local and regional businesses that will benefit RFD.  Raise awareness in the airshow community to facilitate easier attraction of both military and civilian performers for future shows (received high marks by recruiters and performers).  Continue to improve the traffic flow and parking by eliminating bottlenecks and decreasing the slowdowns (no delays during show).  Creating award‐winning marketing communication collateral and advertising (two more awards in December at International Council Air Shows (ICAS) conference).  Continue to grow sponsorship by 25% each year.  Attract more national sponsorships.  Have all fixed costs paid prior to gate opening.  Increase knowledge of consumer through survey engagement. Prior Year Results  Event had over 75,000 attendees (65,000 Attendees).  Marketing campaign won recognition at the international governing body of airshows, the International Council of Airshows (ICAS) (won two more awards at ICAS).

AirFest Department Summary(con’t)

 Growth of MilesAhead membership by 2% (increased 8.31%).  Limited parking to paid only and was able to produce additional revenue source without increasing the ticket price. (Paid parking down due to overall attendance)  Increased sponsorship revenue by 30% (Increased sponsorship revenue by  Added over 800 new members to MilesAhead.

80 AirFest Department Budget

ACTUAL ACTUAL ACTUAL ACTUAL BUDGET ESTIMATE BUDGET $Chg/FY12 %Chg/FY12 CODE/LINE ITEM, Department 09 FYE08 FYE09 FYE10 FYE11 FYE12 FYE12 FYE13 Budget Budget PERSONNEL SERVICES 5400 Insurance $ 13,422 $ 14,419 $ 15,804 $ 12,227 $ 12,186 $ 12,100 $ 12,551 5450 Overtime ‐ ‐ 4,020 12,663 12,656 27,397 17,699 5451 Double time ‐ ‐ ‐ 5,104 3,914 12,000 8,464 5500 Payroll taxes 4,547 3,742 6,354 7,745 8,078 7,832 8,585 5560 Pension contribution 3,914 3,631 4,283 7,901 6,401 7,801 8,036 5600 Salaries/wages 64,409 56,964 87,099 93,254 96,121 95,823 98,650 5605 Outside labor 13,514 16,537 ‐ ‐ ‐ ‐ ‐ 5800 Workers compensation insurance 1,293 310 431 3,674 2,056 2,000 2,517 TOTAL PERSONNEL SERVICES 101,099 95,603 117,991 142,569 141,413 164,953 156,501 15,089$ 10.67%

CONTRACTUAL SERVICES 6021 Ad‐Television 11,950 4,149 7,550 10,900 7,000 7,188 ‐ 6022 Ad‐Radio 2,838 6,665 7,450 8,243 5,500 12,467 ‐ 6023 Ad‐Billboards 3,323 4,043 4,850 ‐ 3,500 1,000 ‐ 6024 Ad‐Direct ‐ 250 ‐ ‐ 2,500 ‐ ‐ 6025 Ad‐Promotions 188 605 725 500 1,250 473 ‐ 6026 Ad‐Print 18,953 18,790 20,444 2,773 9,000 10,883 ‐ 6027 Ad‐Internet/Web ‐ 6140 Conferences & meetings 60,038 2,136 869 510 1,500 12 1,500 6160 Consulting services ‐ 2,967 8,793 13,033 8,000 10,290 ‐ 6165 Airshow contractual 252,836 240,275 201,189 207,437 194,000 207,763 228,500 6170 Airshow lodging ‐ 53,738 43,362 41,144 37,500 48,447 40,000 6175 Airshow rental services ‐ 63,907 52,149 55,121 55,950 51,856 57,950 6185 Airshow food and beverages ‐ 59,342 57,358 60,170 42,750 55,885 49,250 6190 Airshow transportation ‐ 61,736 32,168 49,074 48,000 41,031 52,250 6300 Engineering services 11,290 ‐ 5,763 10,337 7,500 6,661 7,500 6322 Equip maint‐service contracts 4,210 2,200 2,816 4,200 4,000 660 4,000 6350 Equipment rental 98,931 16,090 2,731 8,805 3,050 4,644 8,050 6400 Insurance 14,407 14,407 9,334 9,057 10,024 9,057 10,500 6540 Membership dues 295 ‐ ‐ ‐ ‐ ‐ ‐ 6480 Licenses, titles & inspections 456 143 547 365 452 440 452 6600 Other 1,363 6,121 6,551 8,328 8,500 7,684 8,500 6700 Postage ‐ 533 174 11 ‐ ‐ ‐ 6730 Printing 17,513 25,871 25,266 34,810 31,500 26,259 28,500 6751 Telephone‐cellular ‐ 851 1,777 2,014 1,800 1,588 1,800 6752 Telephone‐local ‐ ‐ 366 1,038 1,025 357 500 6800 Travel & transportation 86,372 1,492 1,639 1,658 1,650 713 1,650 6950 Waste removal ‐ ‐ ‐ 145 300 ‐ ‐ TOTAL CONTRACTUAL SERVICES 584,963 586,311 493,871 529,672 486,251 505,358 500,902 14,651$ 3.01%

COMMODITIES 7271 Fuel‐diesel ‐ 2,340 ‐ 148 250 194 250 7272 Fuel‐unleaded ‐ ‐ 56 361 350 1,329 1,500 7273 Fuel‐other ‐ 38,967 24,295 10,083 20,043 36,563 28,000 7300 Landscaping ‐ 1,488 162 85 250 110 250 7380 Other ‐ 30 ‐ ‐ ‐ ‐ ‐ 7540 Signage 9,964 11,991 8,250 9,480 5,000 5,554 7,500 7600 Subscriptions 420 7660 Supplies‐janitorial ‐ 2,060 3,057 1,799 1,750 3,330 3,000 7750 Supplies‐office ‐ 2,971 1,446 1,637 1,250 1,374 1,250 7780 Supplies‐other 57,587 8,330 2,581 4,418 5,800 6,577 800 7782 Supplies‐hardware ‐ 355 3,123 1,691 1,750 1,377 1,750 7796 Supplies‐promotional ‐ Airshow 1,662 11,544 23,871 29,442 13,850 12,279 13,850 7902 Maint‐equipment ‐ 1,505 ‐ ‐ 1,000 125 1,000 TOTAL COMMODITIES 69,213 81,581 66,841 59,144 51,293 68,813 59,570 8,277$ 16.14%

DEPARTMENT TOTAL $ 755,275 $ 763,495 $ 678,704 $ 731,385 $ 678,957 $ 739,124 $ 716,973 38,017$ 5.60%

81 AirFest Budget Justifications

PERSONNEL SERVICES Personnel services associated with AirFest are based on a percentage for all other departments as outlined below with the addition of funds to support temporary administrative help. Dept 04 ‐ 1.9% Dept 05 ‐ 2.7% Dept 06 ‐ 3.0% Dept 07 ‐ 33.7% Dept 08 ‐ 3.1% Dept 10 ‐ 1.9% Dept 11 ‐ 1.9%

5400 Insurance $ 12,551

5450 Overtime Estimated 614 hours of overtime for hourly employees. $ 17,699

5451 Double time Estimated 184 hours of overtime for hourly employees. $ 8,464

5500 Payroll taxes FICA ‐ 6.2% of base wage up to $106,800 6,322 Medicare ‐ 1.45% of base wage 1,500 State unemployment ‐ 2.15% of the first $12,520 762 Total payroll taxes $ 8,585

5560 Pension contribution IMRF pension fund ‐ 11.20% $ 8,036

5700 Salaries and wages 98,650 Allocated staff time and 2 part‐time temporary staff $ 98,650

5800 Workers compensation insurance $ 2,517

CONTRACTUAL SERVICES 6140 Conferences & meetings Airshow research and conference 1,500 Total conferences & meetings $ 1,500

6165 Airshow contractual AirSho Inc ‐ Rudy Malnati 51,000 Performers fee 83,500 AirSho Inc ‐ Support team 24,000 Contracted security police 25,000 Not‐for Profit Support for parking ‐ donation for 700+ hours 6,000 UPS Parking lot 4,000 Air Force Volunteers 1,000 Stepping Stones 4,500 Friday Night Concert 14,000 Pyrotechnics 15,500 Total airshow contractual $ 228,500

82 AirFest Budget Justifications 6170 Airshow lodging Performers 34,500 Support units 5,500 Total airshow lodging $ 40,000

6175 Airshow rental services Portable toilets 9,000 Fencing ‐ bicycle 8,000 Barricades 5,500 Tents 17,150 Weights and barrels 11,000 Tables 2,600 Chairs 4,700 Total airshow rental services $ 57,950

6185 Airshow food and beverages Sponsor catering 2,500 Captains club 7,500 Family flight line 10,000 Volunteers 7,500 Host tent 6,500 Staff tent 5,000 VIP Party 5,000 Performers 2,500 Ice 2,750 Total airshow food and beverages $ 49,250

6190 Airshow transportation Cars 22,500 Vans 5,000 Golf carts 9,750 Shuttle bus 2,500 Airfare 12,500 Total airshow transportation $ 52,250

6300 Engineering services Layout drawings 7,500 Total engineering services $ 7,500

6322 Equip maint‐service contracts ‐ mowing ‐ electrical $ 4,000

6350 Equipment rental Radios 2,000 Generators 1,000 Forklift rentals 1,000 Towels 50 Stage and sound system 4,000 Total equipment rental $ 8,050

6400 Insurance Airshow 10,500 Total insurance $ 10,500

6480 Licenses, titles & inspections Tent permit 42 City of Rockford event application 340 City of Rockford liquor application 45 Illinois liquor control license 25 Total licenses, titles & inspections $ 452

83 AirFest Budget Justifications

6600 Other ‐ Contractual services not itemized in other accounts. $ 8,500

6730 Printing Admission tickets 7,000 Copy machines usage 3,000 Volunteer and staff credentials 5,000 Banners, flyers and posters 4,500 Souvenir program 9,000 Total printing $ 28,500

6751 Telephone‐cellular $ 1,800

6752 Telephone‐local $ 500

6800 Travel & transportation (airfare/hotel/per diem) Staff conferences and training 1,500 Mileage 150 Total travel & transportation $ 1,650

COMMODITIES 7271 Fuel‐diesel ‐ generators $ 250

7272 Fuel‐unleaded ‐rental vehicles $ 1,500

7273 Fuel‐other Propane ‐ forklifts 1,500 Aircraft fuel 15,000 Smoke oil 11,500 Total fuel ‐ other $ 28,000

7300 Landscaping Mulch and supplies for grounds $ 250

7540 Signage $ 7,500

7600 Subscriptions Internet ‐ Winnebago County 420

7660 Supplies‐janitorial Various supplies 3,000 Total supplies‐janitorial $ 3,000

7750 Supplies‐office Misc supplies 1,250 Total supplies‐office $ 1,250

7780 Supplies ‐ other Extension cords 400 Wristbands 400 Total supplies‐other $ 800

7782 Supplies‐hardware (expendable supplies) $ 1,750

84 AirFest Budget Justifications 7796 Supplies‐promotional Volunteer T‐shirts 3,500 Rudy's Team shirts 300 Staff and commissioner's shirts 1,750 Hats and shirts 2,500 Lanyards 1,300 Gifts for volunteers souvenir sale merchandise 4,500 Total supplies ‐ promotional $ 13,850

7902 Maintenance‐equipment $ 1,000

Cargo Development Department Summary

Cargo development is continuing to move forward with more awareness in the global community, which has led to test flights. There were some great victories last year, and the strategic goal is to land consistent international cargo service. In FY2012 the focus was on the airlines. The goal was to get in front of as many cargo airlines as possible and convince one to make the move to our airport. We will continue to market to the airlines, but add more specific targeted marketing towards the Freight Forwarders both locally, as well as abroad. This process will be a push‐pull process since each group can affect the overall decision to move. Because of the importance of meeting face‐to‐face, Staff will be traveling a considerable amount this coming year.

OBJECTIVES MEASURES TARGETS INITIATIVES

Grow th in diversified revenue Greater than 80% of revenues Monitor annual report, schedule of Revenues sources. from sources other than UPS. major revenue sources.

Increase sales calls, public relations Operations Ranking: Top 20 and global participation at tradeshow s.

Develop financial incentives to grow , Enplaned/Deplaned cargo Operations increase: 20% and diversify domestic and international Expand cargo service to cargo activity. increase economic Enplanements/Deplanements Landed aircraft w eight impact and viability. increase: 27% Airline diversification Landed w eight increase: 27%

Airlines/International New airline operators: 3 International landed w eight: 15% increase

Goals and Objectives Continue to develop and grow awareness of the value of using the airport for international cargo activity and any other support businesses to enhance the value.

 Booth at TIACA event in Atlanta.  CNS Partnership Conference  Air Cargo Conference in Russia  Meet and investigate opportunities to create parts with in the secondary airports in Europe.  Make contact with Freight Forwarders to educate and make them aware of the opportunities and cost savings by using RFD.

86 Cargo Development Department Budget

BUDGET CODE/LINE ITEM, Department 10 FYE13 PERSONNEL SERVICES 5400 Insurance 11,465$ 5500 Payroll taxes 8,728 5560 Pension contribution 13,494 5600 Salaries/wages 120,484 5800 Workers compensation insurance 313 TOTAL PERSONNEL SERVICES 154,484

CONTRACTUAL SERVICES 6140 Conferences & meetings 8,705 6540 Membership dues 12,300 6751 Telephone‐cellular 1,320 6752 Telephone‐local 450 6800 Travel & transportation 28,345 TOTAL CONTRACTUAL SERVICES 51,120

COMMODITIES 7140 Conferences & meetings 4,000 7600 Subscriptions 335 7796 Supplies‐promotional 10,000 TOTAL COMMODITIES 14,335

DEPARTMENT TOTAL 219,939$

87 Cargo Development Budget Justifications

PERSONNEL SERVICES 5400 Insurance The Authority is partially self funded and estimates for this partial funding are incorporated into the annual costs noted below. The annual cost for the Authority at 80% is as follows by each type of coverage: Employee = $5,504.74/$5,622.59 Employee + Spouse = $10,990.61/$10,985.78 Employee + Children = $10,202.04 Family = $15,687.89/$15,312.86 Dental insurance The annual cost for dental is based on cobra rates as the program is self‐funded. Employee = $293.58 Family = $731.09 Life insurance Life and AD&D insurance is provided to current employees. The benefit is 2.5 times an employee's base salary with life at $.22/$1000 and AD&D at $.05/$1000. Health 9,899 Dental 778 Life 789 Total employee insurance $ 11,465

5500 Payroll Taxes FICA ‐ 6.2% of base wage up to $110,100 6,695 Medicare ‐ 1.45% of base wage 1,747 State unemployment ‐ 2.15% of the first $13,560 286 Total payroll taxes $ 8,728

5560 Pension contribution IMRF pension fund ‐ 11.20% $ 13,494

5600 Salaries Includes 1 full time employee and seasonal interns. $ 120,484

5800 Workers compensation insurance $ 313

CONTRACTUAL SERVICES 6140 Conferences & meetings CNS Partnership conference 1,045 TIACA ‐ Atlanta booth 6,160 Air Cargo China 1,500 Total conferences & meetings $ 8,705

6540 Membership dues TIACA ‐ Trustee 10,150 IACAC,CNS, Other cargo 2,150 Total membership dues $ 12,300

6751 Telephone‐cellular $ 1,320

6752 Telephone‐local/h‐s internet $ 450

88 Cargo Development Budget Justifications

6800 Travel & transportation Amounts include an estimate of $450/trip airfare, lodging of $170/night and M&I of $65/day for domestic and $2500/airfare, lodging $295 and M&I of $80/day for international. Deputy Director of Cargo Cargo recruitment ‐ National (3t) (3n) 3,465 Cargo recruitment‐ International (3t) (10n) 18,880 Mileage 6,000 Total travel & transportation $ 28,345

COMMODITIES 7140 Conferences & meetings Cargo handler/Freight forwarder meetings 4,000 Total conferences & meetings $ 4,000

7600 Subscriptions Cargo publications 250 Internet ‐ Winnebago County 85 Total subscriptions $ 335

7796 Supplies‐promotional Promotional items endorsing airport awareness and customer service. Shirts, hats, pens, coasters, lanyards, coloring books, etc 2,500 Client gifts 7,500 Total supplies‐promotional $ 10,000

Passenger Development Department Summary Air Service Development’s goal is to increase available outbound passenger numbers by 100% in three years. With the addition of Hawaii, Denver, London, and Punta Cana this fiscal year, RFD has come closer to that goal. The next year will be instrumental in continuing that growth as airlines will be watching to see how the flights are filled as they put their plans together for summer 2012 and into next winter.

Focus will be put on continuing to push the Frontier Denver product. The more successful Denver is the better chance there is of adding more destinations with Frontier. That will be accomplished by continuing to focus attention on the closer Rockford Region (up to Janesville, over to the Chicago suburbs). The market is tighter due to many airports in the Midwest having Denver service. Tactics will include targeted web presence, targeted direct mail, and strategic placement in Rockford media. In addition to Denver‐ centric advertising, another step to promote the hassle‐free experience at RFD and benefit the Denver product is to add to the list of destinations those destinations that can be reached through Denver.

Awareness marketing is another focal point. This is going to be accomplished mostly through constant contact with the consumer. RFD will continue to work on providing relevant content on social media and MilesAhead. The struggle will be to remain consistent with the communication. When the communication is reduced, consumers stop listening. The website, Facebook, Twitter, MilesAhead, Google+, and the RFD Blog will need to work in concert with each other to keep a consistent branding message in the public. Hassle‐Free extends to getting emails returned, tweets acknowledged, Facebook questions answered, and web updates current. The awareness campaign will also include some local and regional events that will also bring our brand to Madison, Beloit, and possibly Milwaukee. Awareness is accomplished through PR as well. Keeping positive and consistent PR out in the press works towards softening any issues that may arise. The plan is to balance the awareness throughout the year in order to keep top of mind.

OBJECTIVES MEASURES TARGETS INITIATIVES

Grow th in diversified revenue Greater than 80% of revenues Monitor annual report, schedule of Revenues sources. from sources other than UPS. major revenue sources.

Develop incentives and/or marketing support to encourage existing and new Destinations Ranking: Top 200 airline partners to establish new destinations or substantially expand current service. Establish one-off daily flying to multiple Passengers New destinations: 7 new top 30 destinations based on the Expand passenger market service area. service to respond to Establish international and domestic regional demand. Regional Diversification Passenger increase: 100% seasonal flights in support of the travel industry. External usage: 70% increase Create/maintain occasional outside Winnebago County

Charter flying to highly desired International traffic: 50% destinations as mechanism to promote increase RFD to industry and consumers.

Provide exceptional and Surveys show meet or exceed Periodic customer satisfaction surveys. continuously improving Customer satisfaction customer satisfaction. Establish baseline for improvement. customer service.

Passenger Development Department Summary(con’t)

Goals and Objectives  Engage consultants to assist in development of air service.  Implement Service to two additional Top 10 Destinations.  Engage opportunities with Travel Agents and Cruise Lines for peak travel periods.  Implement service to one additional international destination.  Assist special interest groups where possible on charters.  Enhance relationships with existing carriers to grow existing service.  Utilize existing $500,000 Small Community Air Service Development Grant to establish new domestic service.  Increase communication with existing and potential airlines including headquarters visits to ensure RFD’s message is communicated.  Conduct periodic passenger surveys to analyze ways to improve the passenger experience.  Maintain and enhance customer service and community outreach by hosting meetings and events.  Track and respond to customer comments and questions within 24 hours of receipt.  Find replacement service for the Ft Myers, Florida area that was recently lost with the bankruptcy of Direct Air. Prior Year Results  Conducted passenger surveys during peak month to identify traveler origins and reasons for flying from RFD.  Added one new international destination to Punta Cana, Dominican Republic.  Added new domestic service to Denver with Frontier Airlines.  Over two dozen tours were conducted with various schools, clubs, and non‐profit groups informing them of the benefits of using RFD.  There were many events at the terminal during the year for economic development, chamber, the governor, regional and state legislators, and local non‐profit groups.  All customer calls are tracked and returned by the next business day. The log book history is maintained by the Passenger Services Supervisor. These calls help improve the frequently asked questions included on our website and used for our receptionist and after hours answering service.

91 Air Service Development Department Budget

BUDGET CODE/LINE ITEM, Department 11 FYE13 PERSONNEL SERVICES 5400 Insurance 29,017$ 5450 Overtime ‐ 5500 Payroll taxes 15,648 5560 Pension contribution 17,544 5600 Salaries/wages 189,598 5750 Training 3,000 5800 Workers compensation insurance 4,906 TOTAL PERSONNEL SERVICES 259,713

CONTRACTUAL SERVICES 6140 Conferences & meetings 5,600 6150 Revenue guarantee 190,000 6160 Consulting services 15,000 6540 Membership dues 525 6751 Telephone‐cellular 2,370 6752 Telephone‐local 1,680 6800 Travel & transportation 16,115 6806 Customer care/customer service 1,500 TOTAL CONTRACTUAL SERVICES 232,790

COMMODITIES 7140 Conferences & meetings 15,000 7200 Equipment 1,300 7600 Subscriptions 4,545 7540 Signage 5,400 7750 Supplies‐office 1,400 7780 Supplies‐other 3,500 TOTAL COMMODITIES 31,145

DEPARTMENT TOTAL 523,648$

92 Air Service Development Budget Justifications

PERSONNEL SERVICES 5400 Insurance The Authority is partially self funded and estimates for this partial funding are incorporated into the annual costs noted below. The annual cost for the Authority at 80% is as follows by each type of coverage: Employee = $5,504.74/$5,622.59 Employee + Spouse = $10,990.61/$10,985.78 Employee + Children = $10,202.04 Family = $15,687.89/$15,312.86 Dental insurance The annual cost for dental is based on cobra rates as the program is self‐funded. Employee = $293.58 Family = $731.09 Life insurance Life and AD&D insurance is provided to current employees. The benefit is 2.5 times an employee's base salary with life at $.22/$1000 and AD&D at $.05/$1000. Health 26,361 Dental 1,397 Life 1,259 Total employee insurance $ 29,017

5500 Payroll Taxes FICA ‐ 6.2% of base wage up to $110,100 11,755 Medicare ‐ 1.45% of base wage 2,749 State unemployment ‐ 2.15% of the first $13,560 1,144 Total payroll taxes $ 15,648

5560 Pension contribution IMRF pension fund ‐ 11.20% $ 17,544

5600 Salaries Includes 3 full time employee and part time temps for seasonal flights. $ 189,598

5750 Training Other 3,000 Total $ 3,000

5800 Workers compensation insurance $ 4,906

CONTRACTUAL SERVICES 6140 Conferences & meetings Terminal events 900 World Routes 2,000 Routes Americas 1,500 National Air Service Conference 550 Allegiant air service planning conference 150 Other 500 Total conferences & meetings $ 5,600

6150 Revenue guarantee Frontier ‐ Denver Service $ 150,000 Apple ‐ Punta Cana, Montego Bay $ 40,000 Total revenue guarantee $ 190,000

93 Air Service Development Budget Justifications

6160 Consulting services Air Service research/planning 15,000 Total consulting services $ 15,000

6540 Membership dues American Association of Airport Executives (AAAE) 275 Terminal group 250 Total membership dues $ 525

6751 Telephone‐cellular $ 2,370

6752 Telephone‐local/h‐s internet $ 1,680

6800 Travel & transportation Amounts include an estimate of $450/trip airfare, lodging of $170/night and M&I of $65/day for domestic and $2500/airfare, lodging $295 and M&I of $80/day for international. World ROUTES Development Forum (7n) 5,125 ROUTES Americas Air Service Development Forum (4n) 4,000 GLCAAAE/National Air Service Conference (3n) 1,155 Airline Recruitment (2t)(2n) 1,840 Airline Headquarters Meetings (2t)(2n) 1,840 Allegiant air service meeting (3n) 1,155 Mileage 500 Other 500 Total travel & transportation $ 16,115

6806 Customer care/customer service Amounts for issues for passengers $ 1,500

COMMODITIES 7140 Conferences & meetings In‐house luncheon meetings 1,000 Travel agent events 12,500 Terminal events 1,000 Miscellaneous 500 Total conferences & meetings $ 15,000

7200 Equipment ‐ computer (2) $ 1,300

7540 Signage Repair & replacement of signage in terminal areas $ 5,400

7600 Subscriptions Air service/marketing publications 250 Routes Exchange 2,500 Dish network 800 Satelite radio 400 Internet ‐ Winnebago County 595 Total subscriptions $ 4,545

94 Air Service Development Budget Justifications

7750 Supplies‐office Office supplies $ 1,400

7780 Supplies ‐ other Terminal entrance/exit lane seasonal decorating 2,500 Other 1,000 Total supplies‐other $ 3,500

95 Non‐Operating Revenues and Expenses Budget

ACTUAL ACTUAL ACTUAL ACTUAL BUDGET ESTIMATE BUDGET $Chg/FY12 %Chg/FY12 CODE/LINE ITEM FYE08 FYE09 FYE10 FYE11 FYE12 FYE12 FYE13 Budget Budget NON‐OPERATING REVENUE 9000 Annexation agreement $ 139,457 $ 134,025 $ 139,906 $ ‐ $ ‐ $ ‐ $ ‐ 9100 Interest income 468,102 226,716 127,896 89,321 90,000 33,880 45,000 9200 Taxes‐property (operating levy) 2,966,062 3,102,000 3,236,459 3,277,669 3,272,000 3,346,076 3,295,300 9205 Property tax interest (operating levy) 4,465 2,688 665 ‐ 2,000 ‐ 2,000 9250 Taxes‐corporate replacement 646,178 591,658 523,707 582,125 580,000 525,140 517,000 9260 AIP Funds Reimbursement 3,430,820 2,409,760 2,926,027 2,248,144 1,489,429 2,227,434 1,456,024 9270 Passenger facility charges 401,647 441,892 341,985 356,332 500,460 522,905 473,247 9260 Funds from auctioned equipment 4,324 ‐ 1,901 ‐ 5,000 ‐ 20,000 9270 Other Credits ‐ 542,201 26,299 71,400 ‐ 145,279 ‐ TOTAL REVENUE 8,061,055 7,450,940 7,324,845 6,624,990 5,938,889 6,800,714 5,808,571 (130,318) (2.19%)

NON‐OPERATING EXPENSES 9500 Interest expense 13,312 2,829 204,207 222,750 212,000 144,047 161,706 9720 Bad debt expense ‐ 16,529 ‐ ‐ ‐ ‐ TOTAL EXPENSES 13,312 19,358 204,207 222,750 212,000 144,047 161,706 (50,294) (23.72%)

NET TOTAL $ 8,047,743 $ 7,431,582 $ 7,120,638 $ 6,402,240 $ 5,726,889 $ 6,656,667 $ 5,646,865

96 Non‐Operating Revenues and Expenses Budget Justifications

NON‐OPERATING REVENUE 9100 Interest income Interest earned on all bank deposits and investments. $ 45,000

9200 Taxes‐property (operating levy) FYE11 Tax Levy Ordinance $ 3,295,300

9205 Property tax interest (operating levy) Interest received on the operating tax levy. $ 2,000

9250 Taxes‐corporate replacement Personal Property Replacement Tax (PPRT) revenue received from the Illinois Department of Revenue (estimate). $ 517,000

9260 AIP Reimbursement Funds Amounts reimbursed to the airport for previous projects. $ 1,456,024

NON‐OPERATING EXPENSES 9500 Interest expense Total interest expense $ 161,706

OTHER CAPITAL CONTRIBUTIONS 3060 Passenger facility charges Passenger facility charge ($4.5 less expenses) $ 473,247

9260 Funds from auctioned equipment $ 20,000

Capital Improvement Program Summary The Capital Improvement Program (CIP) is a five to ten year program that provides for critical improvements and asset preservation. The program includes projects that address federal security requirements, airfield safety, enhanced revenue potential, rolling equipment replacement, asset preservation and completion of the newly updated Master Plan.

Projected FYE13 CIP capital expenditures are as follows and detail of individual items to follow.

Airside Projects Airside projects include improvements for runways, taxiways, aprons, and buildings inside the airfield fence.

Rehabilitate Runway 1/19 ‐ Phase 2a and Taxiway Foxtrot Rehabilitation ‐ Construct paved shoulder FAA AIP Project ‐ 2nd phase of the runway reconstruction project and portions of Taxiway F do not have a paved shoulder. As part of the ability to handle group 6 aircraft (747‐800) this shoulder work is necessary. This construction is a result of the Modification of Standards (MOS) through the FAA. The Authorities share is 5.0%.

Project Cost: Authority share only $305,881 Total Project Cost $6,172,683 Operating Impact – reduction in heavy maintenance and ground Est. $40,000 work in shoulder area.

Fencing ‐ Phase 1 FAA AIP Project ‐ Currently the airport has 6 and 8 ft. fencing on the perimeter of the airfield. This is the 1st phase in a 2 phase project to improve the safety and security of the airfield by transitioning all fencing to 10 ft.

Project Cost: Authority share only $32,824 Total Project Cost $662,384 Operating Impact – reduction in repairs and wildlife damage Est. $10,000 repairs.

Capital Improvement Program Summary(con’t)

Wildlife Study IDOT DOA Project – The current wildlife plan requires a periodic update tour wildlife study and our last update was 10 years ago. IDOT has approved this project and will participate in the funding at 50%.

Project Cost: Authority share only $17,500 Total Project Cost $35,000 Operating Impact N/A

Part 150 NEM update FAA AIP Project ‐ Part 150 regulations govern the development and review of an integrated plan to achieve noise control objectives by encouraging compatible land uses in and around airports through the development of Noise Exposure Maps (NEM). The NEM is required for update in advance of any significant development at the airport.

Project Cost: Authority share only $13,931 Total Project Cost $281,128 Operating Impact N/A

ComEd / Fiber Duct Currently there is an electrical trunk line running under runway 7/25 along the path of old Beltline Road. This line feeds UPS, and all the businesses along Cessna Drive. If this line were to fail ComEd would have to dig under runway 7/25 and taxiway foxtrot to find the fault and repair it. This would shut down the runway until all repairs were complete. This project will put duct work under the runway and accessible manholes outside of the runway safety areas. Doing so will allow ComEd to run a new line and if future repairs are necessary it will have minimal effect on airport operations. A second duct will also be put in for a future run of fiber communications to the mid‐field area.

Total Project Cost $45,000 Operating Impact N/A

Airfield Perimeter Roadway Expansion In conjunction with the Runway rehab we will utilize millings from the excavation to extend the perimeter roadway on the southeast corner of the airfield from the Midfield east approximately 3000 feet. Includes cost estimate for staking of road, equipment and labor to prepare the site for the millings.

Total Project Cost $25,000 Operating Impact N/A

Capital Improvement Program Summary(con’t)

Ramp Repairs In continuation of the pavement maintenance program airfield ramp repairs will expand to other areas of the AOA. These areas include but are not limited to the FIS, Terminal, Main ramp, and South Cargo areas. This annual program will rehabilitate spalling of the concrete and also remove and replace the joint material that is creating FOD. The ramp is 16 years old and in need of infrastructure repair as a result of high use by heavy aircraft and the excessive freeze thaw process that happens constantly in our region.

Total Project Cost $100,000 Operating Impact – reduction of unplanned rehab N/A

Landside Projects Projects related to any area outside of the airfield except for the terminal areas.

Falcon Road & Airport Drive Improvement Total projected investment is $3 million however we will fund the project $1 million annually. This is a joint project with the City of Rockford and the total cost of the project is approximately $9.5 million. With this improvement Falcon Road and all future maintenance, upkeep and snow removal will be the responsibility of the City of Rockford.

Total Project Cost $1,000,000 Operating Impact – reduction in repair costs to Falcon Road $30,000

Acquisition of 4080 Easy Street Acquisition and improvements to facility. The Authority will acquire this facility near the airport for current tenant opportunity.

Total Project Cost $2,700,000 Operating Impact N/A

Terminal Projects Projects related to any areas from terminal parking lots to the jet bridges and everything in between.

Terminal Boiler Modification The terminal heating system is comprised of 7 hot water boilers. During an inspection in the spring of 2011 it was noted by Travelers Insurance that low water / fuel cutoff and high temperature limit with reset controls must be installed on each boiler unit. These controls will increase safety as it relates to the terminal heating system.

Total Project Cost $13,000 Operating Impact N/A

100

Capital Improvement Program Summary(con’t)

Wheel Chairs (20) There is a need for additional wheel chairs. Wheelchairs are utilized at the terminal on a regular basis. There are 2.5‐4% Pax request on outbound seats for the use of wheel chairs. A maintenance agreement will be used to maintain the chairs.

Total Project Cost $9,000 Operating Impact N/A

Common Use Terminal Equipment (CUTE) and Server Replacement This replacement would include 10 desktops with 22” monitors at $1,009.00 each. Also included is an additional $4,000.00 for labor to install and any cabling adjustments that may be needed as well as replacement of servers that are 5 years old. This upgrade will allow for expansion along with upgrades that are needed for the CUTE system.

Total Project Cost $31,000 Operating Impact N/A

Flight information display/televisions The current system is 8 years old and requires manual adjustment. The project includes new screens compatible with a web application and ability to update remotely. Screens are located at the check‐in counter and gates that communicate to the passenger’s airlines, destinations and departure and arrival data. This includes 30 screens, programming and other hardware and wiring necessary for new system. 20 check‐in monitors, 5 gate monitors, 3 security checkpoint information monitors, 1 Baggage Information Screen and 1 Entry way FIDS

Total Project Cost $120,000 Operating Impact Staff time reduction

Terminal Auto Parking Expansion ‐ Phase I IDOT ‐ DOA Project ‐ As passenger service has grown, during peak periods auto parking is very limited. Terminal parking expansion is necessary to accommodate our growth and peak travel months. This is the first in a potential 2 phase process to build out the remaining surface parking locations. This will add approximately 200 parking spots. The Authority share of the project is 10%.

Project: Authority share only $100,000 Total Project Cost $1,000,000 Operating Impact N/A

Terminal Facility Capacity Expansion – Planning Design Only As passenger service has grown the capacity of the Terminal building is stretching the limits of the facility. During our peak travel time’s line are long and create safety issues and reduce our hassle free environment. These modifications will allow us to process more passengers in a timely manner.

Total Project Cost $150,000 Operating Impact N/A

101

Capital Improvement Program Summary(con’t)

Jetbridge 4 Re‐Habilitation This project will repair any rust or defects in the metal, and a complete repainting of the outside. On the inside, the carpet and wall treatments will be replaced, as well as the heater. The bridge will be completely checked over and any components that are not in 100% working order will be replaced. This will allow the passenger the same comforting hassle free experience while arriving or departing no matter what bridge they board on.

Total Project Cost $40,000 Operating Impact N/A

CUTE Expansion ‐ 10 ticket counter/2 gate Plan for addition and expansion of passenger services. Purchase 10 additional computers for downstairs, 2 gate computers and Network Switch. The cost estimate for desktops with serial adapters, 22” monitors and VMware for 1,239.00 each and network switch for 9,000.00. Also included is an additional $4,000.00 for labor to install and any cabling adjustments that may be needed.

Total Project Cost $28,000 Operating Impact N/A

Ticket Counter Modification/Expansion Rebuild of ticket counter to expand to 20 check‐in positions and associated scales. New podium/scale layout will maximize our passenger throughput at check‐in.

Total Project Cost $250,000 Operating Impact N/A

Flat Screen TV's Need for 6 additional flat screen TV’s for showing news/weather/and sports in the boarding area. Currently Gate 4 is the only gate with televisions.

Total Project Cost $10,000 Operating Impact N/A

Administrative Projects Administrative projects related to general information technology or administrative areas.

Website Upgrade The project would include an entire upgrade to the current website to include a new software platform that will allow for more user friendly updating and allow for multiple staff to make changes.

Total Cost $50,000 Operating Impact Reduced consulting costs

102

Capital Improvement Program Summary(con’t)

Network Server Replacement Upgrade to the current services at it is 7 years old. Also included is an additional $1,000.00 for labor to install and any cabling adjustments that may be needed. This upgrade will keep us current with changing technology.

Total Cost $11,500 Operating Impact N/A

Microsoft Office 2010 This would be a network license to all computers within our network/system for upgrades to Office 2010. Some units are still operating 2003 and 2007 which results in conversion issues when sharing files. Improves efficiency.

Total Cost $15,000 Operating Impact N/A

Maintenance Projects Maintenance projects for the various equipment and maintenance needs at the airport.

Replace Vehicle 28/29 Both #28 and #29 are in need of replacement. #28 is a 1992 International 4900 single axle dump truck, and #29 is a 1993 International 4900 dual axle dump. Both of these trucks are set up for landside snow removal with plows and solid chemical application equipment. Both trucks are in extremely poor shape and in constant need of repairs. These trucks would be replaced with one International Terrastar or equivalent with dump body or hydraulic flatbed lift and chemical application equipment.

Total Cost $75,000 Operating Impact Reduced repair expenses

Upgrade and Reconfigure Vehicle 39 Vehicle 39 serves a critical function as the primary airfield pavement marking piece of equipment (Paint Machine). With more than 900,000 square feet of FAA regulated pavement markings it is necessary to keep this equipment in proper working condition. Vehicle 39 is approaching 15 years of service, and needs a "frame off" restoration, repair and reconfiguring.

Total Cost $50,000 Operating Impact Reduced repair expenses

Airfield Service Vehicle Replacement of vehicle #15 which is a 2000 Ford F‐350 quad cab with a service body. #15 is in very poor shape and has just over 100,000 miles. This vehicle will be replaced with a Ford F‐250 with a service body.

Total Cost $33,500 Operating Impact Reduced repair expenses

103

Capital Improvement Program Summary(con’t)

SRE High Speed Door The vehicle doors into the SRE are very large and used frequently. Over the past 24 months we have spent $12,500 maintaining the highest traffic doors. A high speed door will better suit constant use, reduce maintenance costs, and help increase the overall energy efficiency of the SRE building by reducing heat loss.

Total Cost $18,000 Operating Impact Reduced repair expenses

Floor Scrubber Replacement of the current riding floor scrubber that is used at the SRE building with a more industrial walk behind design. Over the past 24 months we have spent $5,500 repairing this piece of equipment. The reason for the high repair cost is that it is the wrong design for the SRE facility, it is better suited for use in the terminal. The current 2007 Minuteman riding floor scrubber will be relocated to the terminal once this purchase is made.

Total Cost $8,000 Operating Impact Reduced repair expenses

Energy Upgrades Continuation of the DCEO energy efficiency grant program into other airport authority owned properties to included administration building and other airport owned facilities.

Total Cost $40,000 Operating Impact Reduced energy costs

Lift Gates Installation of three rear lift gates to vehicles #17,#21, and #26 all are 2012 Ford F‐350’s that were purchased in FY12. The lift gates will allow personnel the flexibility to move heavy equipment on to and off of the trucks with mechanical assistance and reduce the possibility of injury. The lift gates will be Tommy Gate 55”x38” 1300lbs capacity or equivalent.

Total Cost $5,000 Operating Impact N/A

Shop Equipment Replacement of metal cutting band saw, drill press, and tire changer, all 3 are greater than 12 years old and our not functioning properly.

Total Cost $6,500 Operating Impact Reduced repair expenses

104

Capital Improvement Program Summary(con’t)

Mid‐Sized Snow Plow Plow for an F‐350 truck. The plow would primarily be utilized on the airside maintaining perimeter roads and other small areas were large plows can't maneuver.

Total Cost $11,000 Operating Impact N/A

Lawn Mower Replacement of two zero turn mowers. The two ZTM are in excess of 12 years old. The mower in question would also be utilized during winter weather on the terminal sidewalks.

Total Cost $12,300 Operating Impact N/A

Lock and Key System(LAKS) Lock and Key System is the manual back up to the automated security system that is in use. In the event of a catastrophic failure of the automated system RFD would revert back to the LAKS as the primary form or securing the airport till the automated system can be repaired. The LAKS system has not been re‐ vamped since it was first installed in 2000. This project would replace 100 Primus cores and 500 Primus level keys. The cores that are pulled will be re‐keyed and placed back inventory for future use, and will allow RFD to remain secured at all times.

Total Cost $14,500 Operating Impact N/A

Utility Locate Equipment The metrotech 9800 is multi‐purpose cable and pipe locators that will help the personnel locate underground utilities faster and more accurately before the start of a project. The current locate only works intermittently and can be inaccurate.

Total Cost $5,000 Operating Impact N/A

Fuel Management System Current fuel tracking system is 10+ years old and evaluation of data is labor intensive. New system will allow for better tracking of data and usage.

Total Cost $16,000 Operating Impact Reduced staff time

105

Capital Improvement Program Summary(con’t)

Utility Vehicle This vehicle will serve as an alternate, more fuel efficient form of transportation around the airport. It also provides the department with a vehicle that will be able to go anywhere on the airport property under any conditions. There are many areas on the airport’s property that are not accessible by a large vehicle. It will also be used for wildlife control, security patrols, air fest, fence maintenance, weed control, and any other function where a large vehicle cannot be used.

Total Cost $12,000 Operating Impact N/A

Operations Projects Operations projects necessary to maintain adequate safety and security at the airport.

Redundant Security Server/Replace Workstation (2) This project will consist of server replacement and software upgrades and installation. Software upgrades are available and need to be installed to keep the security system up to date. The RFD security system is the primary CCTV and Access Control System at RFD. This system’s primary function is to maintain compliance with TSA 1542 and the RFD Airport Security Plan. To improve the reliability of the security system it is critical to have a redundant server in case of failure. This system operates all electronic access points for the airport as well as camera systems throughout the campus.

Total Cost $43,700 Operating Impact N/A

SMS Phase I Consulting Services The Notice of Proposed Rule Making (NPRM) on SMS was issued November 5, 2010. The program has been closed for comment and now just currently awaiting the final ruling. Once the final rule is in place RFD will have to comply. This project will hire an outside consultant to help staff put together the SMS Gap Analysis, and help create the SMS manual. The consultant that wins the bid will work hand in hand with staff during the development of the SMS manual. SMS is a proactive organizational approach to safety, and will be the biggest change to part 139 airports since the re‐write of part 139 back in 2004.

Total Cost $50,000 Operating Impact N/A

106

Exhibit 1

Tentative Budget and Appropriation Ordinance GREATER ROCKFORD AIRPORT AUTHORITY RESOLUTION NO. 12‐09

WHEREAS, the Greater Rockford Airport Authority (the "Authority") is a municipal corporation located in Winnebago County, Illinois, duly created, organized, and existing under an Act of the General Assembly of the State of Illinois entitled the "Airport Authority's Act," as amended, 70 ILCS 5, et. seq., and having the powers, objects, and purposes provided under said Act;

WHEREAS, in accordance with 50 ILCS 330/3, the Authority is required to adopt a Tentative Budget and Appropriation Ordinance for the fiscal year, beginning May 1, 2012 and ending April 30, 2013;

WHEREAS, in accordance with 50 ILCS 330/3, the Authority is required to place on file at the Administrative offices of the Authority for public inspection a copy of the Tentative Budget and Appropriation Ordinance; and

WHEREAS, in accordance with 50 ILCS 330/3, 35 ILCS 200/18‐50, and 35 ILCS 200/23‐35, the Authority is required to call for a public hearing on the Tentative Budget and Appropriation Ordinance, and publish notice of said public hearing.

NOW, THEREFORE, be it resolved by the Chairman and the Board of Commissioners at the Authority, Winnebago County, State of Illinois, that:

1. The Authority hereby adopts the Tentative Budget and Appropriation Ordinance for the fiscal year, beginning May 1, 2012 and ending April 30, 2013 a copy of which is on file at the Administrative Offices of the Authority;

2. The Authority hereby directs its staff to place on file at the Administrative Offices of the Authority for public inspection a copy of the Tentative Budget and Appropriation Ordinance for the fiscal year, beginning May 1, 2012 and ending April 30, 2013 a copy of which shall be placed on file at least thirty (30) days prior to the date set by the Authority for the public hearing;

3. The Authority hereby directs its staff to call for and hold a public hearing on the Tentative Budget and Appropriation Ordinance on April 26, 2012 at 5:25 p.m. at the Administrative Offices of the Authority;

4. The Authority hereby directs its staff to publish in a newspaper of general circulation notice of the public hearing on the Tentative Budget and Appropriation Ordinance, provided that said notice shall be published at least thirty (30) days prior to the date set by the Authority for the public hearing.

107

Exhibit 1 (con’t)

Tentative Budget and Appropriation Ordinance RESOLUTION NO. 12‐09

5. The Authority's staff is hereby authorized and directed to take any additional actions necessary to effectuate the above Resolution in accordance with applicable Illinois statutory law.

Commissioner Wetzel moved, seconded by Commissioner Cicero that Resolution Number 12‐09 be adopted.

Vote Vote

Ray Wetzel _aye__ Paul Cicero aye Kenneth Copeland aye Bharat Puri aye Darrin Golden absent Phil Rubin _aye__ Tom Myers aye

ADOPTED this 24th day of February, 2012 by the Chairman and the Board of Commissioners of the Greater Rockford Airport Authority, Winnebago County, Illinois.

(Signed February 24, 2012)______Bharat Puri, Chairman

ATTEST:

(Signed February 24, 2012)______Phil Rubin, Treasurer

108

Exhibit 2 Chicago Rockford International Airport (RFD) Rates and Charges Effective July 1, 2012

Terminal Usage fee (includes use of ramps, jet way, baggage claim & public safety fee) Signatory and/or scheduled Airlines $55.00 Non‐Signatory and/or charter flights $110.00 Ticket Counter/Computer Use fee (per enplanement) $0.10 Passenger Facility Charge (PFC) (per enplanement) $4.50 Ticketing, passenger check‐in and airline station services (excludes below wing) (per seat) $2.25

Landing Fee Greater than 120,000,000 pounds annual landed weight $1.842 /1000lbs Less than 120,000,000 pounds annual landed weight $1.964 /1000lbs Landing fees will only apply to revenue producing commercial cargo and passenger air carriers with a minimum weight of 28,000 pounds.

Fuel Flowage Fees Class A Permit $1,125.00 Flowage Fee $0.06/gallon Class B Permit $600.00 Flowage Fee $0.08/gallon Class C Permit $375.00 Flowage Fee $0.08/gallon Flowage fee applies to all non‐revenue producing aircraft fuelings.

Commercial operating permit /per square foot $0.28 Commercial operating permit/Nontenant (base fee) $250.00 Commercial operating permit/Nontenant (additional per badge fee) $250.00

International rubbish fee 4x4 hopper (200 gallons) $305.00 Black cart (60 gallons) $105.00 Gray cart (40 gallons) $85.00 User is ultimately responsible for fines incurred as of the result of use (IEPA, CBP, Dept of Agriculture, etc)

109

Exhibit 2(con’t)

Badging Fees Secure, Sterile & AOA w/SIDA endorsement Original issue badge $100.00 Badge renewal $50.00 1st lost badge with re‐issue $250.00 2nd lost badge with re‐issue $500.00 3rd lost badge with re‐issue $1,000.00

AOA Original issue badge $50.00 Badge renewal $25.00 1st lost badge with re‐issue $150.00 2nd lost badge with re‐issue $300.00 3rd lost badge with re‐issue $600.00

Not returned or lost badges (all types) $250.00

Fingerprint fee (non‐badged) $35.00

Fingerprint fee plus required follow up investigation if necessary $55.00/hr

Fines Security system false alarm $25.00 Security system false alarm requiring an Operations response $75.00 Unauthorized SIDA Entry/Exit (per occurrence) $100.00 Improper use of RFD ID media ‐ (Includes ID media revocation) $150.00 Operation of an out of service vehicle on RFD AOA Non‐movement area (per occurrence) $250.00 Premise key (Lost key ‐Cost to re‐key all locks affected including labor to disassemble if necessary.) Airfield incursions/TSA violations ( Violator is responsible for all costs/fines levied to RFD by FAA/TSA)

Service Fees Escort fee per 1/2 hour minimum ($50/hour) $25.00 Maintenance fee for snow removal (minimum 1 hour) $75.00/hr Equipment Usage fee/per hour plus labor fee $125.00/hr RFD labor fee ‐/per hour plus parts/equipment Base $45.00/hr Skilled $55.00/hr Administration $75.00/hr Ground Security Coordinator fee (1/2 hour minimum) $60.00/hr

110

Exhibit 3

Acronym and Glossary of Terms

AAAE ‐ American Association of Airport Executives

ACI‐NA ‐ Airports Council International – North America

Accrual Basis of Accounting‐ This Basis of accounting attempts to record financial transaction in the period they occur rather than recording them in the period they are paid.

AD&D ‐ Accidental Death and Dismemberment

AFR ‐ Annual Financial Report

Aircraft Operation‐ The landing or take off of an aircraft.

Airline Load Factor – The percentage of seats occupied on an aircraft.

Airport – Refers to the Chicago Rockford International Airport.

Airport Improvement Program (AIP) – A Federal Aviation Administration program periodically reauthorized by Congress which distributes the proceeds of the federal tax on airline tickets to airports through grants for eligible construction projects and land acquisition.

Airport Layout Plan (ALP) – A blue print of an airport required by the Federal Aviation Administration which shows current and future airport development.

Airport Master Plan – An airport master plan represents the approved actions to be accomplished for phased development of the airport. Master plans address the airfield, terminal, landside access improvements, modernization and expansion of existing airports and establish the premise for site selection and planning for a new airport.

Airport Operation ‐ One landing or takeoff

Airside – The airfield side of an airport used by aircraft, runways, taxiways, and aircraft parking aprons.

Amortization – (1) The gradual reduction of a debt by means of equal periodic payments sufficient to meet current interest and liquidate the debt at maturity. (2) The process of spreading the costs of an intangible asset over the expected useful life of the asset. (3) The deduction of capital expenses over a specific period of time. Similar to depreciation, it is a method of measuring the “consumption” of the value of long‐term assets like equipment and buildings.

ARFF – Aircraft Rescue and Fire Fighting.

The Authority – Refers to the Greater Rockford Airport Authority

Balanced Budget – a budget where the revenues equals expenditures.

111

Exhibit 3(con’t)

BOD ‐ Biochemical Oxygen Demand

Bond – A written promise to pay a specified sum of money, called principal, at a specified maturity date along with periodic interest paid at a specified percentage of the outstanding principal. They are usually used for long‐term debt.

Budget – A financial plan for a specified period of time (fiscal year) that matches planned expenses and revenues with planned services.

Budget Calendar – The schedule of key dates or milestones that the Authority follows in the preparation, adoption and administration of the annual budget.

BFYE – Budgeted Fiscal Year End

Capital Budget ‐ Budgeted expenditures for capital improvements, capital outlay, debt service and grant service that are in excess of $2,000

Capital Improvement Program – A rolling, near‐term five year program that provides for critical needed improvements and asset preservation. The program includes projects that address federal security requirements, improved airfield safety and enhance revenue potential.

Cash Equivalent – In the context of cash flows reporting, short term highly liquid investments that are both readily convertible to known amounts of cash and so near their maturity that they present insignificant risk of changes in value because of changes in interest rates.

Cost Centers – An area of the Airport to which a revenue or expense is attributed, e.g., airfield, terminal, etc.

Cost Per Enplanements – The airlines’ airport cost, landing fees and rents, divided by the total number of passengers enplaned at the airport.

CPE ‐ Continuing Professional Education

CPI‐W ‐ Consumer Price Index – Urban Wage Earners & Clerical Workers

CY – Calendar Year

Deplaning Passenger – An arriving passenger.

Depreciation – Expiration in the service life of capital assets attributable to wear and tear, deterioration, action of physical elements, inadequacy or obsolescence.

Enplaning Passenger – A departing Passenger.

112

Exhibit 3(con’t)

Enterprise Fund – Established to account for operations, including debt service that are financed and operated similarly to private businesses – where the intent is the service is self‐sufficient, with all costs supported predominantly by user charges.

FAR – Federal Aviation Regulations

FAS ‐ Fixed Asset Schedules

Federal Aviation Administration (FAA) – A component of the Department of Transportation with primary responsibility for the safety of civil aviation.

Federal Grants – FAA’s Airport Improvement Program provides both entitlement and discretionary grants for eligible airport projects. Entitlement funds are determined by a formula according to enplanements at individual airports. The authority applies for discretionary grants from the FAA through a Letter of Intent (LOI) process. Each LOI represents an intention to obligate funds from future federal budget appropriations. The issuance of a Letter of Intent is subject to receipt of Congressional appropriations for grants to airports, and does not itself constitute a binding commitment of funds by the FAA. For planning purposes, the amounts in approved LOI from FAA are used by the Authority as the estimate of federal discretionary grants to be received.

FIS ‐ Federal Inspection Service

Fiscal Year – A 12 month period, other than a calendar year, used for financial reporting purposes. The GRAA’s fiscal year begins May 1st and ends April 30th.

Fixed Base Operator (FBO) ‐ Businesses on airports that sell fuel to private plane owners, provide aircraft parking, as well as aircraft maintenance and mechanical services.

Flight Information Displays (FID) – Electronic displays to inform passengers of the status of their flight, such as arrival time, and terminal building gate number.

FOD – Foreign Object Debris or trash on the airfield.

FTZ ‐ Foreign Trade Zone

FYE ‐ Fiscal Year End

GAAP – General Accepted Accounting Principles are uniform minimum standards and guidelines for accounting and financial statement reporting.

GASB – Governmental Accounting Standards Board, the body responsible for establishing GAAP for governmental entities.

General Aviation (GA) – The activities of privately owned aircraft that are not used for commercial purposes, such as the movement of passengers or freight.

GFOA ‐ Government Finance Officers Association

113

Exhibit 3(con’t)

GO ‐ General Obligation (Bonds)

GRAA ‐ Greater Rockford Airport Authority

ILS ‐ Instrument Landing System

IMRF ‐ Illinois Municipal Retirement Fund, retirement fund for all Authority employees

Infrastructure ‐ Airport runways, taxiways, aprons and utility systems

INS ‐ Immigration and Naturalization Service

IPAA ‐ Illinois Public Airports Association

Jet Bridge – A mechanical tunnel used by passengers to pass from the terminal building to an aircraft.

Landed Weight – The maximum gross certificated landed weight of an aircraft, or all aircraft landing at an airport in a fiscal year, which is not dependent on the number of passengers on board.

Landing fee – The rate charged by an airport to commercial aircraft operators per thousand pounds of landed weight.

Landside – All Areas of land owned and maintained by the RTAA outside of the airfield areas perimeter fence.

M&I ‐ Meals and Incidentals

Non‐Airline Revenue – Airport revenue earned from sources other than airlines, such as concessions revenues: Merchandise, Food and Beverage, Rental Car, etc. Airports try to maximize non‐airline revenue to help reduce the amounts they collect form the airlines.

Non Signatory Airline – Airlines that have not signed an agreement with airport committing to rent an airport leasehold for a fixed period of time.

OTC/DDEC ‐ Oshkosh Training Center/Diesel Diagnostic Electronic Components

Part 107 – A section of the Federal Aviation Regulations having to do with an airport operator’s responsibilities for airport security.

Part 139 – A section of the Federal Aviation Regulations having to do with the certification of an airport’s airfield.

Part 150 Study – A noise study defined by a section of the Federal Aviation Regulations, that when completed, makes an airport eligible for noise insulation and related land acquisition grants. The Study produces two documents, the Noise Exposure Map and the Noise Compatibility Program.

114

Exhibit 3(con’t)

Passenger Facility Charge (PFC) – A $4.50 charge (net $4.39 to Airport) attached to each ticketed passenger that boards an airplane at the Airport. Certain types of passengers, including military, are excluded from the Passenger Facility Charge.

PEBSCO ‐ Public Employees Benefit Services Corporation, optional 457 deferred compensation

Proprietary Fund – One of three Fund classifications established by the GAAP standards. This Fund is used to account for funds for operations which are managed in a manner similar to private business. Unlike governmental funds, net income is determined in Proprietary Funds. The two types of Proprietary Funds are Enterprise and Internal Service Funds.

RFD‐ The FAA three letter identifier for the Chicago Rockford International Airport.

RWY – Runway

Security Identification Display Area (SIDA) – Secure areas of the airport in which identification badges are required to be displayed.

Signatory Airline – Airlines that have signed an agreement with an airport committing to rent an airport leasehold for a fixed period of time.

SRE ‐ Snow Removal Equipment

T‐Hangar – A small hangar that resembles a “T” when viewed from above. T hangars are placed next to each other, and inter locked back to back, to maximize the number that can be placed in an area which minimizes the land rental component of their cost.

Transportation Security Administration (TSA) – A component of the Department of Transportation with primary responsibilities for the security of civil aviation.

TSS ‐ Total Suspended Solids

TXY – Taxiway

UPS ‐ United Parcel Service

115 Exhibit 4 Statistics

Airport Authority Area Located entirely within Winnebago County, Illinois, the Authority Area includes, Rockford, Machesney Park, Loves Park, Cherry Valley, Roscoe, New Milford and some unincorporated areas

Airport Location Southwest quadrant of the City of Rockford 4 miles south of downtown Rockford, IL 80 miles WNW of O’Hare International Airport

Access Interstate 90 and 39 U.S. Highway 20 Illinois Route 2 and 251

Area 3,000 acres

Elevation 736 ft. above sea level LAT 42 11” 36” (42 degrees, 11 minutes and 36 seconds) LNG 89 05’ 50” (89 degrees, 05 minutes and 50 seconds)

Airport Code RFD

Runways Runway 1/19, 8,200’ X 150’, ILS Category I Runway 7/25, 10,000’ x 1150’, ILS Category II/III

Tower TRSA 24/7‐365

FBOs Emery Air, Inc., North American/Pride

Scheduled Passenger Service Allegiant Airlines, Frontier Airlines and Apple Vacations

Terminal Airlines 2,211 sq. ft. Tenants 4,443 sq. ft. Public/Common 30,433 sq. ft. Mechanical 7,714 sq. ft. Total 44,801 sq. ft.

Number of Passenger Gates 5 Number of Loading Bridges 5 Number of Concessionaires in terminal 1 Number of rental car agencies in terminal 3

Car Rental Agencies Avis, Hertz and National/Alamo

Parking Short‐Term 1,477 Rental Cars 190 Employees 54

116

Exhibit 4(con’t)

Cargo UPS Buildings 670,000 sq. ft. International Cargo Building 70,000 sq. ft Cross Dock Building 27,600 sq. ft. Cargo Building 21,000 sq. ft.

International Customs/Immigration Federal Inspection Service Facility

Service Area Population within Authority Area, 227,773 Population within 25 miles, 740,000 Population within 60‐minute drive, 2.5 million Population within 90‐minute drive, 8.4 million

Airport Authority Area Equalized Assessed Valuation % Change from Prior Yr (in thousands) 2007 $3,580,845,000 6.47% 2008 $3,722,189,000 3.95% 2009 $3,722,982,000 0.02% 2010 $3,525,363,000 ‐5.31% 2011 $3,350,384,000 ‐4.96%

$3,800

$3,700 Millions

$3,600

$3,500

$3,400

$3,300

$3,200

$3,100 2007 2008 2009 2010 2011

117

Exhibit 4(con’t)

Bond Rating 1999 A3 2000 A2 2001 A2 2002 A2 2003 A1

Based Aircraft Single engine 69 Multi engine 17 Jet 20 Helicopters 3 Total 109

Airport Operations

CY07 CY08 CY09 CY10 CY11 Air Carrier 14,732 15,010 11,903 10,649 9,727 Air Taxi 5,865 5,069 2,257 2,426 2,481 GA Local 12,814 11,857 9,516 10,212 13,327 GA 22,821 20,676 18,485 Itinerant 35,845 30,167 Military 4,992 2,829 2,333 2,318 1,604 Total 74,248 64,932 48,830 46,281 45,624

80,000

70,000

60,000 Military 50,000 GA Itinerant 40,000 GA Local 30,000 Air Taxi 20,000 Air Carrier

10,000

0 CY07 CY08 CY09 CY10 CY11

118

Exhibit 4(con’t)

Passengers

% Change from Prior Yr FYE08 233,044 18.67% FYE09 177,484 ‐23.84% FYE10 201,844 13.73% FYE11 206,382 2.25% FYE12 211,894 2.67%

250,000

200,000

150,000

passengers 100,000

50,000

0 FYE08 FYE09 FYE10 FYE11 FYE12

Cargo Aircraft Landed Weight (lbs.)

% Change from Prior Yr FYE08 1,487,894,013 4.81% FYE09 1,327,827,612 ‐10.76% FYE10 1,021,396,570 ‐23.08% FYE11 902,395,080 ‐11.65% FYE12 884,405,380 ‐1.99%

119

Exhibit 4(con’t)

1,600

1,400

1,200

1,000

800 pounds Millions 600

400

200

0 FYE08 FYE09 FYE10 FYE11 FYE12

Cargo Enplaned and Deplaned (lbs.)

% Change from Prior Yr FYE08 471,963,329 4.31% FYE09 388,527,333 ‐17.68% FYE10 299,640,828 ‐22.88% FYE11 259,112,297 ‐13.53% FYE12 291,223,839 12.39%

500 450 400 350 300 250

pounds200 Millions 150 100 50 0 FYE08 FYE09 FYE10 FYE11 FYE12

120

Exhibit 4(con’t)

Fuel Flowage (gallons)

% Change from Prior Yr FYE08 19,246,193 ‐9.26% FYE09 14,755,983 ‐23.33% FYE10 17,502,695 18.61% FYE11 17,242,721 ‐1.49% FYE12 15,223,883 ‐11.71%

Millions 20

gallons 10

0 FYE08 FYE09 FYE10 FYE11 FYE12

121

Exhibit 5

ORDINANCE NO. 12‐03

FISCAL YEAR 2011 BUDGET AND APPROPRIATION ORDINANCE

CERTIFICATE

I, BHARAT PURI, Chairman of the Board of Commissioners of the Greater Rockford Airport Authority, Winnebago County, Illinois (the "Authority"), a municipal corporation of the State of Illinois, certify that the attached is a true and complete copy of an Ordinance entitled:

"GREATER ROCKFORD AIRPORT AUTHORITY BUDGET AND APPROPRIATION ORDINANCE FOR THE FISCAL YEAR BEGINNING May 1, 2011 AND ENDING April 30, 2013," unanimously passed at a regular meeting of the Board of Commissioners (the "Board") of the Authority at which a quorum of the Board was present, and held at the offices of the Authority at 60 Airport Drive, Rockford, Illinois, on July 26, 2012 having complied with the provisions of the Open Meetings Act (5 ILCS 120/1 et. seq.).

I further certify that there have been no amendments or revisions to said Ordinance, and that it is now in full force and effect.

IN TESTIMONY WHEREOF, I have set my hand and affixed the corporate seal of the Authority this 26th day of July 2012.

[SEAL]

(signed July 26, 2012)______Bharat Puri Chairman, Board of Commissioners Greater Rockford Airport Authority

122

Exhibit 5(con’t)

ORDINANCE NO. 12‐03

GREATER ROCKFORD AIRPORT AUTHORITY BUDGET AND APPROPRIATION ORDINANCE

FOR THE FISCAL YEAR BEGINNING May 1, 2012 AND ENDING April 30, 2013

BE IT ORDAINED BY THE BOARD OF COMMISSIONERS OF THE GREATER ROCKFORD AIRPORT AUTHORITY, WINNEBAGO COUNTY, ILLINOIS, AS FOLLOWS:

Section 1. Adoption of Budget

The Tentative Budget, as previously presented, is adopted as the Budget for the Greater Rockford Airport Authority, Winnebago County, Illinois, the “Authority,” and is attached hereto and incorporated herein by reference.

The amounts specified are the maximum estimated for probable expenditure or commitment prior to April 30, 2013, and there is included in the appropriated amounts funds derived from other sources than local taxation, and which may be spent for the benefit of the Authority without actually being received and expended by it.

All unexpected balance(s) of any item or items of any general appropriation made by this Ordinance may be expended in making up any deficiency in any item or items in the same general appropriation made by this Ordinance.

Placed on file for Public Inspection March 8, 2012

Notice of Public Hearing Published on March 8, 2012

Public Hearing held April 26, 2012 (at 5:25 p.m. Central Daylight Savings time, pursuant to Notice)

Section 2. Appropriations.

For the fiscal year ending April 30, 2013, there is hereby appropriated for the corporate purposes of the Greater Rockford Airport Authority the total sum of $15,586,023 which sum of money is deemed necessary to pay the costs of operating and maintaining the Greater Rockford Airport, and other expenses of the Authority, the purposes of each such appropriation being specified in the attached Budget document.

123

Exhibit 5(con’t)

Section 3. Filing with County Clerk.

That a certified copy of this Ordinance shall be filed with the County Clerk on or before August 26, 2012 by the financial officer of the Authority.

Section 4. Conflicting Orders, Resolutions or Ordinances.

That all orders, resolutions or ordinances in conflict herewith are repealed insofar as such conflict exists.

Section 5. Effective Date.

This Ordinance shall be effective following its passage by the Board and upon its approval by the Chairman of the Board.

Moved for adoption by Commissioner __Wetzel____ and seconded by Commissioner _Rubin______.

Roll Call

Paul R. Cicero _aye_ Kenneth Edward Copeland _aye_ Darrin Golden _absent Thomas Myers _absent_ Bharat Puri _aye_ Phil Rubin _aye_ Ray Wetzel _aye_

Passed and approved by the Board of Commissioners of the Greater Rockford Airport Authority on July 26, 2012.

(signed July 26, 2012)______Bharat Puri Chairman, Board of Commissioners Greater Rockford Airport Authority

ATTEST:

(Signed July 26, 2012) _ Paul Cicero Secretary, Board of Commissioners Greater Rockford Airport Authority

124

Exhibit 5(con’t) ORDINANCE NO. 12‐03

2012‐2013 BUDGET AND APPROPRIATION ORDINANCE

CERTIFICATE

I, Phil Rubin, Treasurer of the Board of Commissioners of the Greater Rockford Airport Authority, Winnebago County, Illinois (the "Authority"), a municipal corporation of the State of Illinois, certify that I am Treasurer of the Board of Commissioners of the Authority and that attached is an estimate prepared by me for the revenues, by source, anticipated to be received by the Authority during such fiscal year of the Authority, pursuant to 50 ILCS 330/3, as amended.

IN TESTIMONY WHEREOF, I have set my hand and affixed the corporate seal of the Authority this 26st day of July, 2012.

[SEAL] (Signed July 26, 2012)______Phil Rubin Treasurer, Board of Commissioners Greater Rockford Airport Authority

125

Exhibit 5(con’t) ESTIMATED REVENUES BY SOURCE FISCAL YEAR 2013

EXPECTED CASH FLOW DURING THE YEAR:

SOURCES

Operating Budget Revenue $ 5,440,277 Non‐Operating Revenue 562,000 Tax Levy 3,297,300 AIP Fund Reimbursement 1,456,024 Passenger Facility Charges 473,247 Other Financing Sources 5,520,000

Total Sources $16,748,848 Beginning Fund Balance, FY12 9,222,720

Total Sources and Fund Balance $25,971,568

USES

Operating Expenditures $ 9,434,087 Non‐Operating Expenditures 161,706 Debt Service 402,094 Capital Expenditures 5,558,136

Total Uses $15,586,023 Ending Fund Balance, FY13 10,385,545

Total Uses and Ending Fund Balance $25,971,568

126