2018 COMPREHENSIVE ANNUAL FINANCIAL REPORT FOR THE FISCAL YEARS ENDED DECEmbER 31, 2018 & 2017 INDIANAPOLIS, INDIANA indianapolis airport authority 2018 COMPREHENSIVE ANNUAL FINANCIAL REPORT Fiscal years ended December 31, 2018 and 2017 Indianapolis Airport Authority, Indianapolis, IN Prepared by the Indianapolis Airport Authority contents 1.0 introductory section 3.0 statistical section Mission Statement 4 finAnciAl trend dAtA Indianapolis Airport Authority Statements of Net Position 90 Facilities Map 5 Statements of Revenues, Expenses Board of Directors 6 and Changes in Net Position 92 Organizational Structure 9 Statements of Cash Flows 94 Executive Management Team 9 Letter of Transmittal to the Board 10 revenue cApAcity dAtA Certificate of Achievement for Excellence Operating Revenues 96 in Financial Reporting 18 Signatory Airline Rates and Charges 98 2.0 financial section debt cApAcity dAtA Independent Auditor’s Report 20 Outstanding Debt by Type and Management’s Discussion and Analysis 22 Revenue Bond Debt Service Ratios 100 Revenue Bond Debt Service Coverage 102 Audited finAnciAl stAtements Statements of Net Position 38 operAting informAtion Statements of Revenues, Expenses and Airline Landing Weight Statistics 104 Changes in Net Position 40 Enplaned Passenger Statistics 106 Statements of Cash Flows 41 Number of Airport Employees by Notes to Financial Statements 43 Identifiable Activity 108 Schedule of Insurance in Force 110 supplementAry informAtion Schedule of Statement of demogrAphic And economic dAtA Net Position Information 74 Indianapolis MSA Demographic and Schedule of Revenues, Expenses, Economic Statistics 111 and Changes in Net Position Information 78 Principal Employers In Indianapolis – Schedule of Operating Revenues 80 Carmel – Anderson MSA 112 Schedule of Operating Expenses 82 Capital Asset and Other Schedule of Bond Debt Service Airport Information 113 Requirements to Maturity 86 2018 COMPREHENSIVE ANNUAL FINANCIAL REPORT 1 indianapolis airport authority 1.0 introductory section 2 2018 2018 C COMPREHENSIVEOMPREHENSIVE A ANNUNNUAALL F FININAANNCCIAIALL REPORT REPORT indianapolisindianapolis airportirport authority 4 Mission Statement 5 Indianapolis Airport Authority Facilities Map 6 Board of Directors 9 Organizational Structure 9 Executive Management Team 10 Letter of Transmittal to the Board 18 Certificate of Achievement 20182018 C OMPREHENSIVE COMPREHENSIVE ANNU ANNUAL AFLIN FAINNACNIACLI AREPORTL REPORT 3 indianapolis airport authority mISSION STATEmENT: FOSTERING world-class service TO ENHANCE OUR COMMUNITY 4 2018 COMPREHENSIVE ANNUAL FINANCIAL REPORT indianapolis airport authority INDIANAPOLIS 1 Indianapolis International Airport AIRPORT AUTHORITY Hendricks County Airport-Gordon Graham Field 2 3 Eagle Creek Airpark FACILITIES MAP 4 metropolitan Airport 5 Indianapolis Regional Airport 6 Indianapolis Downtown Heliport 4 I-65 I-465 I-69 3 I-74 5 2 6 I-70 IND 1 I-74 I-70 I-65 2018 COMPREHENSIVE ANNUAL FINANCIAL REPORT 5 indianapolis airport authority INDIANAPOLIS AIRPORT AUTHORITY BOARD BARBARA GLASS, KURT SCHLETER, PRESIDENT MEMBER Consultant, Owner, Lilly Foundation GridLock Traffic Systems Years of service: 4 Years of service: 2 STEVEN DILLINGER, VICE PRESIDENT TAMIKA CATCHINGS, Owner, S.C. Dillinger & MEMBER Associates Insurance Agency Owner, Years of service: 22 Tea’s Me Cafe Hamilton County Years of service: 1 MAMON POWERS III, SECRETARY LYNN GORDON, Executive Vice President, MEMBER President - Indianapolis office, Retired, Banking Executive Powers & Sons Construction Co. Years of service: 14 Years of service: 3 Morgan County BRETT VOORHIES, KATHY DAVIS, MEMBER MEMBER President, Indiana AFL-CIO Owner, Years of service: 5 Davis Design Group LLC Years of service: 1 TOBY MCCLAMROCH, MATTHEW WHETSTONE, MEMBER MEMBER Managing Partner, Founding Member Bingham Greenebaum Doll LLP 1816, Inc. Years of service: 3 Years of service: 1 JEFF GAITHER, MEMBER BRIAN TUOHY, Managing Partner, BOARD COUNSEL Bose McKinney & Evans Doninger Tuohy & Bailey LLP Years of service: 2 Years of service: 3 6 2018 COMPREHENSIVE ANNUAL FINANCIAL REPORT indianapolis airport authority KURT SCHLETER, MEMBER IND Owner, GridLock Traffic Systems Years of service: 2 bEST AIRPORT IN NORTH AMERICA TAMIKA CATCHINGS, MEMBER Owner, Tea’s Me Cafe Years of service: 1 YEARS IN A ROW LYNN GORDON, MEMBER Retired, Banking Executive Years of service: 14 7 Morgan County KATHY DAVIS, WORLD-CLASS MEMBER Owner, CUSTOMER SERVICE Davis Design Group LLC Years of service: 1 MATTHEW WHETSTONE, MEMBER Founding Member 1816, Inc. Years of service: 1 Best AIrpOrT TOp 10 Best in America DOMESTIC 2014, 2015, 2016, AIrpOrT 2017, 2018 2016, 2017, 2018 BRIAN TUOHY, Condé Nast Traveler Travel + Leisure BOARD COUNSEL Doninger Tuohy & Bailey LLP Years of service: 3 2018 COMPREHENSIVE ANNUAL FINANCIAL REPORT 7 indianapolis airport authority 22,500 AREA JOBS 10,100 WORKERS AT IND ON AN AVERAGE DAY $2.0 BILLION PAYROLL 22,500 AREA JOBS 8 2018 COMPREHENSIVE ANNUAL FINANCIAL REPORT indianapolis airport authority ORGANIZATIONAL STRUCTURE BOARD OF DIRECTORS MARIO RODRIGUEZ Executive Director LISA BIERMAN MARIA WILEY Senior Executive Assistant Senior Director of Audit & Compliance, Procurement KEITH MARSHA ROBERT REID BILL RACHEL JAROD TENLEY BERLEN STONE THOMSON GOLDSMITH STINSON STEVENS KLAAS DRESCHER- Senior Director Senior Director Senior Director Senior Director Senior Director Senior Director Senior Director RHOADES of Operations of Commercial of Finance & of Information of Public Affairs of Human of Planning & $2.0 & Public Safety Enterprise Treasurer Technology Resources Development General Counsel BILLION PAYROLL EXECUTIVE MANAGEMENT TEAM MArIO rODrIGUEZ MArSHA STONE BILL Stinson Executive Director Sr. Director of Commercial Enterprise Sr. Director of Public Affairs 31 years of experience 25 years of experience 26 years of experience MArIA WILEY rOBErT THOMSON Rachel STEVENS Sr. Director of Audit & Sr. Director of Finance & Treasurer Sr. Director of Human Resources , Compliance, Procurement 30 years of experience 22 years of experience 22 500 26 years of experience JArOD Klaas rEID GOLDSMITH Sr. Director of Planning KEITH BErLEN Sr. Director of Information & Development Sr. Director of Operations Technology 24 years of experience & Public Safety 13 years of experience Tenley Drescher-Rhoades 29 years of experience General Counsel 20 years of experience 2018 COMPREHENSIVE ANNUAL FINANCIAL REPORT 9 indianapolis airport authority LETTER OF TRANSMITTAL 7800 Col. H. Weir Cook Memorial Dr. Suite 100 • Indianapolis, Indiana 46241 office 317.487.9594 • fax 317.487.5034 June 30, 2019 to the Members of the Board: The Comprehensive Annual Financial Report (CAFR) of the Indianapolis Airport Authority (Authority or IAA), for the fiscal years ended December 31, 2018 and 2017, is submitted herewith. Responsibility for both the accuracy of the presented data and the completeness and fairness of the presentation, including all disclosures, rests with the Authority and its management. To the best of our knowledge and belief, this report, in all material aspects, fairly presents and discloses the Authority’s financial position, results of operations, and cash flows as of and for the year ended December 31, 2018 and 2017, in accordance with the requirements of the generally accepted accounting principles in the United States of America (GAAP). GAAP requires that management provide a narrative overview and analysis to accompany the financial statements in the form of a Management Discussion and Analysis (MD&A). This introductory letter should be read in conjunction with the MD&A, which can be found immediately following the Independent Auditor’s Report on Financial Statements and Supplementary Information in the financial section of the CAFR. This CAFR has been prepared following the guidelines recommended by the Government Finance Officers Association of the United States and Canada (GFOA). All financial and non-financial information included in this CAFR relates solely to the Authority unless specifically stated otherwise. It is our belief that the accompanying 2018 Comprehensive Annual Financial Report meets program standards and will be submitted to the Government Finance Officers Association for review. indEpEndEnt AUDIT At the close of each calendar year, an independent firm of certified public accountants audits the Authority’s financial statements. In addition, the Indiana State Board of Accounts retains the right to audit the Authority. In connection with the Authority’s federal financial assistance, a Single Audit (conducted in accordance with Uniform Guidance) is performed and reports are issued to the Indiana State Board of Accounts and filed with the Federal Audit Clearinghouse. intErnal Controls The Authority’s management is responsible for the establishment and maintenance of internal accounting controls that ensure assets are safeguarded and financial transactions are properly recorded and adequately documented. To ensure that the costs of controls do not exceed the benefits obtained, management is required to use cost estimates and judgments to attain reasonable assurance as to the adequacy of such controls. The Authority has established internal controls to fulfill these requirements and these controls are reviewed annually by an external audit firm for applicability, relevance, and effectiveness. 10 2018 COMPREHENSIVE ANNUAL FINANCIAL REPORT indianapolis airport authority PROFILE OF THE AUTHORITY organizational struCturE and govErnanCE The Authority is a municipal