Fiscal Year 2021 MONROE COUNTY, FLORIDA
KEY WEST INTERNATIONAL AIRPORT
FINANCIAL STATEMENTS
As of and for the Year Ended September 30, 2021
And Report of Independent Auditor
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KEY WEST INTERNATIONAL AIRPORT
MONROE COUNTY, FLORIDA
ANNUAL FINANCIAL REPORT
FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2021
PAGE
INTRODUCTORY SECTION
Transmittal Letter of the Clerk of the Circuit Courts & Comptroller A-1
List of Elected and Appointed Officials A-6
Organizational Chart A-7
FINANCIAL SECTION
Report of Independent Auditor B-1
Management's Discussion and Analysis C-1
Basic Financial Statements:
Statement of Net Position D-1
Statement of Revenues, Expenses, and Changes in Net Position D-3
Statement of Cash Flows D-5
Notes to Financial Statements E-1
Required Supplementary Information
Schedule of Airport's Proportionate Share of Net Pension Liability
Florida Retirement System Pension Plan F-1
Schedule of Airport's County Contributions Florida Retirement System Pension Plan F-3
Schedule of Airport's Proportionate Share of Net Pension Liability
Health Insurance Subsidy Program F-5
Schedule of Airport's Contributions Health Insurance Subsidy Program F-7
Schedule of Changes in the Airport's Total OPEB Liability and Related Ratios F-9
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G,,I COURr,C
°A Kevin Madok, CPA
. .......b,�' Clerk of the Circuit Court& Comptroller— Monroe County Florida
�RoE GOUNSy a J 1
March 31, 2022
The Honorable David Rice
Mayor, Board of County Commissioners
Citizens of Monroe County, Florida
We are pleased to submit the Annual Comprehensive Financial Report for the Key West
International Airport Monroe County, Florida for the fiscal year(FY) ended September 30, 2021.
The Airport's Annual Comprehensive Report is prepared by the Finance Department under the
direction of the Clerk of the Circuit Court & Comptroller (Clerk). Responsibility for both the
accuracy of the presented data and the completeness and fairness of the presentation, including all
disclosures, rests with the Clerk as Chief Financial Officer of Monroe County, Florida (the
County). We assert that, to the best of our knowledge and belief, this financial report is complete
and reliable in all material aspects.It is presented in a format designed to fairly present the financial
position and results of operations of the Airport as measured by the financial activity. All
disclosures needed to allow the reader to gain a comprehensive understanding of the Airport's
financial activity have been included.
The County has established a comprehensive internal control framework that is designed both to
protect the County's assets from loss,theft, or misuse and to compile sufficient reliable accounting
information for financial statement preparation in conformity with United States generally
accepted accounting principles (GAAP) established by the Government Accounting Standards
Board. Because the cost of internal controls should not outweigh their benefits, the objective is to
provide reasonable rather than absolute assurance that the financial statements will be free of
material misstatement.
Independent Audit
The County's auditor, Cherry Bekaert LLP, has issued an unmodified ("clean") opinion on the
Airport's financial statements for the year ended September 30, 2021. The report of the
independent auditor is located at the front of the Financial Section in this report.
Management Discussion and Analysis
GAAP requires that management provide a narrative introduction, overview, and analysis to
accompany the basic financial statements in the form of Management's Discussion and Analysis
(MD&A). The MD&A can be found immediately following the report of the independent auditor
in this report and fulfills this requirement. This Letter of Transmittal is designed to complement
the MD&A and should be read in conjunction with it.
KEY WEST MARATHON PLANTATION KEY PK/ROTH BUILDING
500 Whitehead Street 3117 Overseas Highway 88820 Overseas Highway 50 High Point Road
Key West,Florida 33040 Marathon,Florida 33050 Plantation Key,Florida 33070 Plantation Key,Florida 33070
305-294-4641 305-289-6027 305-852-7145 305-852-7145
Key West International Airport Profile
Basic Information
Located in the City of Key West in Monroe County, Florida, the Key West International Airport
has a unique history due to its compact size and strategic geographic location. Originally called
Meacham Field,Pan American Airways scheduled the Airport's first flight in 1928. During World
War 11, after the attack on Pearl Harbor,the Airport was used by the United States Army. In 1953,
the City of Key West granted Monroe County clear title to Meacham Field. Soon thereafter, the
Airport officially became the Key West International Airport.
The Airport sits on approximately 334 acres at an elevation of three feet. It has a single 5,076-foot
asphalt runway. The Airport's passenger terminal complex consists of two buildings, with the
original terminal, built in 1957, on the lower level serving arriving passengers and connecting to
the departure gates. The terminal was expanded in 2009 with a newer building as the upper level
that houses ticketing, check-in, and security checkpoints. Parking is available adjacent to the
landside terminal in a parking garage. The Airport provides for additional passenger services such
as car rental facilities and ground transportation.
Monroe County is the primary population area served by the Airport. Monroe County is the
southernmost county in the United States with only one road, U.S. 1, connecting some of the
islands known as the Florida Keys to the mainland. The City of Key West,the county seat and the
County's southernmost city, is approximately one hundred fifty miles southwest of Miami. The
Florida Keys are a popular domestic and international tourist destination. It offers the largest
national maritime sanctuary and the only living coral barrier reef in the continental United States.
The Airport falls under the governance of the Monroe County Board of County Commissioners
(the"Board"). The Board is comprised of five members, all of whom are elected. The Board acts
as a local legislative and executive body, setting public policy, levying taxes, and funding projects,
programs, and the operations of county departments. The Board appoints a county administrator
to carry out the Board's policies and decisions. The Airport, a county department, is managed by
the Senior Director of Airports who reports directly to the county administrator. Under the
direction of the elected Monroe County Clerk of Circuit Courts and Comptroller, the Monroe
County Finance Department maintains the accounting system for the Board's operations,including
the Airport's operations.
The Airport has a senior management team consisting of the senior director of airports, one
assistant director of airports and two deputy directors. The Airport is a financially self-sustaining
enterprise fund that generates revenues from user fees and lease revenues. The Airport's primary
function is to provide the infrastructure to facilitate air service for the residents and tourists of
Monroe County. As of September 30, 2021, the Airport has scheduled service from six domestic
carriers (American Airlines, Delta Airlines, United Airlines, Silver Airways, JetBlue, and
Allegiant) accommodating 1.3 million passengers in the 12 months ending September 30, 2021.
The Airport is also served by FedEx and UPS cargo carriers.
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Buffet
According to Florida Statutes, Chapter 129, a budget shall be prepared, balanced, approved,
adopted, and executed each fiscal year (October 1 through September 30). The Board conducts
budget meetings on departmental budgets. The Airport prepares a tentative budget which is
presented to the Board for approval.
Formal budgetary integration is employed as a management control device during the year for all
fund types. During the year, the County's Office of Management and Budget acts on
intradepartmental cost center budget changes and interdepartmental cost center budget changes are
submitted to the Board as a Budget Resolution for approval.A budget amendment is required when
alterations are made to a fund's total revenues or expenditures. The Board may adopt the budget
amendment after public hearings are held.
Economic Condition and Outlook
Local Economy
Monroe County's economy is largely dependent on the tourism and hospitality industries. As a
result, reliable economic indicators include airplane passenger enplanements/deplanements and
bed tax revenues. Total passengers increased nearly 942% in the past year, well exceeding the
increase in the County's bed tax revenues of 20.5%. The Airport's increase not only reflects the
recovery of tourism to the Florida Keys in FY 2021, but also reflects the addition of two new
airlines providing increased passenger services to 24 destinations.
The increases in these economic indicators over the past year reflects how Monroe County has
begun its recovery from the negative impacts experienced in FY 2020 due to the global pandemic
caused by a novel strain of coronavirus (COVID-19). The pandemic not only adversely impacted
the County's projected tax revenue during the previous fiscal year, but it also was financially
devastating to many of the County's citizens and small businesses. In response, the Airport was
awarded $21.8 million in Coronavirus Aid, Relief, and Economic Security (CARES) Act funds.
The Airport used the CARES Act funds to stabilize operating income by covering operating
expenses,with $4.78 million being used to fund expansion of the aircraft overflow parking apron.
In December 2020,in response to the slow economic recovery due to COVID-19,the United States
government executed the Coronavirus Response and Relief Supplemental Appropriation
(CRRSA) Act. The Airport received two awards totaling $3.6 million, of which $.1 million is to
provide rent relief to concessionaires. Additional Federal stimulus funds of approximately $6.3
million was awarded to the Airport under the American Rescue Plan Act(ARPA). Of the ARPA
funds awarded, $.5 million also is to provide rent relief to concessionaires.
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Long-term Financial Planning
The Airport uses a commercial compensatory rate setting methodology. The cost of airlines
operating at the Airport is represented by cost per enplaned passenger or CPE. The CPE is
calculated as total airline revenues divided by total enplaned passengers. The Airport's CPE for
the past four years was:
2021 $ 8.90 (estimated)
2020 $13.32
2019 $ 9.28
2018 $10.11
The numbers reflect an average across all carriers. Individual airlines may have a CPE that is
higher or lower than the average based on their individual operating models.
The overall CPE has trended downward as a result of management's efforts to control costs and
increase air service. The effect of COVID-19 directly impacted passenger traffic levels and, as a
result, drove up CPE for 2020. A strong recovery in 2021 helped reduce CPE, and Airport
management continues to focus on reducing costs and applying federal stimulus funding to
minimize the impact of the pandemic on airline operating costs.
During the fiscal year,the Airport negotiated with the airlines for a new five-year airline operating
agreement, effective October 1, 2021. The new lease agreement includes provisions for the
airlines' use and occupancy of facilities at the Airport.
Major Initiatives
The Airport is planning to construct a new second-level Concourse A terminal building. The
primary goal of Concourse A is to increase capacity and enhance passenger experience.
Construction is scheduled to begin in 2022, with a projected completion in 2024. Concourse A
will be approximately 49,000 square feet and include:
• Glass-enclosed passenger loading bridges;
• Expansion of additional baggage make up areas and devices;
• Airline ramp/office spaces;
• Ramp equipment storage areas;
• Additional baggage claim device;
• Expanded rent-a-car facility and baggage service offices.
The Concourse A Terminal and Improvements Program also includes improvements to the existing
landside terminal including:
• Expanded security checkpoint with an area to support up to four lanes and added support
spaces; and
• A new extended passenger pedestrian bridge for public access to airport administration
offices.
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Another major initiative in the Airport's master plan is the expansion of the commercial apron.
The expansion will entail airfield signage, markings, and lighting which will add approximately
13,200 square yards of concrete pavement, About 2,000 cubic yards of fill material will be used
for the new apron pavement to meet the grade of the existing apron and to regrade the surrounding
land to match. existing grades. The project will include drainage improvements to accommodate
the expanded pavement.
Relevant Financial Policies
The Board. strives to adhere to sound financial management principles to ensure that sufficient
funds are available to maintain a stable financial base for the Airport. To achieve a stable financial
base,the County budgets to maintain a.net position sufficient to fund the Airport's cash flow needs,
to provide financial reserves for unanticipated expenditures or unexpected revenue shortfalls.
In accordance with Section 218.415, Florida Statutes, the County's investment policy, approved
in January 2019, establishes investment objectives, maturity and liquidation requirements,
portfolio composition, risk and diversification requirements, and authorized investments. The
primary objective of investment activity is the safety of the principal of funds and maintain
sufficient liquidity to meet anticipated cash flow needs. A secondary objective is to obtain
competitive returns on the investment of the County's surplus funds.
We would like to express our appreciation to the entire Finance Department, the Board of County
Commissioners and Airport staff for their assistance in the preparation of this report.
We also extend our thanks and appreciation to our independent auditor, Cherry Bekaert LLP, for
its outstanding efforts, advice, and assistance.
Sincerely,
V/
...........
Kevin Madok, CPA Pam Radloff, :,PA
Clerk of the Circuit Courts & Comptroller Monroe County
Chief Financial Officer Finance Director
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MONROE COUNTY, FLORIDA
BOARD OF COUNTY COMMISSIONERS
MICHELLE COLDIRON, MAYOR
DISTRICT 2
CRAIG CATES VACANT
DISTRICT 1 DISTRICT 3
DAVID RICE HOLLY RASCHEIN
DISTRICT 4 DISTRICT 5
ROMAN GASTESI
COUNTY ADMINISTRATOR
KEVIN MADOK, CPA
CLERK OF THE CIRCUIT COURT AND
COMPTROLLER
Key West International Airport Staff
Rickard Strickland Senior Director of Airports
Erick D'Leon Assistant Director of Airports
Beth Leto Deputy Director, Airport Finance & Admin
Luis Garay Deputy Director, Airport Operations & Security
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Key West International Airport
Organization Chart
Public
Board of
County Commissioners
County
Administrator
Roman Gastesi
Senior Director of Airports
Richard Strickland
Assistant Director of Deputy Director, Deputy Director,
Airports Finance&Admin Operations&Security
Erick D'Leon Beth Leto Luis Garay
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CherryB I �Ir��;���r>
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Report of Independent Auditor
To the Clerk Ex Officio, Mayor
Board of County Commissioners
Monroe County, Florida
Report on the Financial Statements
We have audited the accompanying financial statements of the Key West International Airport (the "Airport"), an
enterprise fund of Monroe County, Florida, as of and for the year ended September 30, 2021, and the related
notes to the financial statements, which collectively comprise the Airport's basic financial statements as listed in
the table of contents.
Management's Responsibility for the Financial Statements
Management is responsible for the preparation and fair presentation of these financial statements in accordance
with accounting principles generally accepted in the United States of America; this includes the design,
implementation, and maintenance of internal control relevant to the preparation and fair presentation of financial
statements that are free from material misstatement, whether due to fraud or error.
Auditor's Responsibility
Our responsibility is to express an opinion on these financial statements based on our audit. We conducted our
audit in accordance with auditing standards generally accepted in the United States of America and the
standards applicable to financial audits contained in Government Auditing Standards, issued by the Comptroller
General of the United States. Those standards require that we plan and perform the audit to obtain reasonable
assurance about whether the financial statements are free of material misstatement.
An audit involves performing procedures to obtain audit evidence about the amounts and disclosures in the
financial statements. The procedures selected depend on the auditor's judgment, including the assessment of
the risks of material misstatement of the financial statements, whether due to fraud or error. In making those risk
assessments, the auditor considers internal control relevant to the entity's preparation and fair presentation of
the financial statements in order to design audit procedures that are appropriate in the circumstances, but not
for the purpose of expressing an opinion on the effectiveness of the entity's internal control. Accordingly, we
express no such opinion. An audit also includes evaluating the appropriateness of accounting policies used and
the reasonableness of significant accounting estimates made by management, as well as evaluating the overall
presentation of the financial statements.
We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our audit
opinions.
Opinion
In our opinion, the financial statements referred to above present fairly, in all material respects, the financial
position of the Airport as of September 30, 2021, and the respective changes in financial position and cash flows
thereof for the year then ended in accordance with accounting principles generally accepted in the United States
of America.
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Emphasis of Matters
As described in Note 1, the financial statements present only the Airport and do not purport to, and do not,
present fairly the financial position of Monroe County, Florida as of September 30, 2021, the changes in financial
position, or its cash flows for the year then ended in accordance with accounting principles generally accepted in
the United States of America.
Corrections of Prior Period
As described in Note 14 to the financial statements, net position at September 30, 2020 was restated in the
amount of $7,381,343 due to a correction of the prior period. Our opinions are not modified with respect to this
matter.
Other Matters
Required Supplementary Information
Accounting principles generally accepted in the United States of America require that the Management's
Discussion and Analysis and the Required Supplementary Information as listed in the table of contents be
presented to supplement the financial statements. Such information, although not a part of the financial
statements, is required by the Governmental Accounting Standards Board, who considers it to be an essential
part of financial reporting for placing the financial statements in an appropriate operational, economic, or historical
context. We have applied certain limited procedures to the required supplementary information in accordance with
auditing standards generally accepted in the United States of America, which consisted of inquiries of
management about the methods of preparing the information and comparing the information for consistency with
management's responses to our inquiries, the financial statements, and other knowledge we obtained during our
audit of the financial statements. We do not express an opinion or provide any assurance on the information
because the limited procedures do not provide us with sufficient evidence to express an opinion or provide any
assurance.
Supplementary and Other Information
Our audit was conducted for the purpose of forming an opinion on the financial statements that collectively
comprise the Airport's basic financial statements. The transmittal letter of the Clerk of the Circuit Courts &
Comptroller, list of elected and appointed officials, and organizational chart are presented for purposes of
additional analysis and are not a required part of the basic financial statements and, accordingly, we do not
express an opinion or provide any assurance on them.
Other Reporting Required by Government Auditing Standards
In accordance with Government Auditing Standards, we have also issued our report dated March 31, 2022, on
our consideration of the Board's internal control over financial reporting and our tests of its compliance with
certain provisions of laws, regulations, contracts, and grant agreements and other matters. The purpose of that
report is solely to describe the scope of our testing of internal control over financial reporting and compliance and
the results of that testing, and not to provide an opinion on the effectiveness of the Board's internal control over
financial reporting or on compliance. That report is an integral part of an audit performed in accordance with
Government Auditing Standards in considering the Board's internal control over financial reporting and
compliance.
ttp
Tampa, Florida
March 31, 2022
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Management's Discussion and Analysis
Airport Management offers readers this narrative overview and analysis of the financial activities of the
Key West International Airport(Airport) for the fiscal year ended September 30, 2021.
We encourage readers to consider this information in conjunction with additional information furnished
in the letter of transmittal in the Introductory Section of this report and the audited basic financial
statements for an overall view of the Airport's activities.
Financial Highlights and Summary
The Airport's financial highlights for the fiscal year are as follows:
• During FY 2021, for the first time in the history of the County,the Airport completed negotiations
and entered into an Airline Operating Agreement with all six commercial service airlines serving
the airport.
• During FY 2021, air service at the Key West International Airport saw a huge increase in flight
activity and seats. Year over year seats increased 95% from 526,840 in FY 2020 to 1,028,873 in
FY 2021.
• Additionally, airlines started new destinations as demonstrated by United Airlines starting service
to Dulles and Houston and new airlines starting service for the first time at the airport were JetBlue
and Allegiant,which all contributed to the overall increase of approximately 11% in landings fees
collected.
• Beginning March of 2021,the airport began to experience significant passenger volume increases,
which continued through the end of the fiscal. Total passenger volume increased more than 436%
from March 2021 through September 2021 versus the period of March 2020 through September
2020.
• American Airlines and United Airlines continued to show significant passenger volume increases.
American Airlines' passenger volume in FY 2021 was 644,353 versus 309,534 in FY 2020, a
108%increase. United Airlines' passenger volume in FY 2021 was 167,984 versus 69,317 in FY
2020, a 142% increase.
• During FY 2021, an amendment with Enterprise Rent-A-Car was approved which contributed to
the increase in rental car operating revenue to$1,071,345 in FY 2021 versus $392,383 in FY 2020,
a 173% increase.
• Airport Management also negotiated new agreements with FedEx and Signature Flight Support,
which contributed to the increase in the other rents operating revenue. FedEx rent payments in FY
2021 totaled $167,885 versus $84,247 in FY 2020, a 99% increase. Signature rent payments in
FY 2021 totaled $196,113 versus $162,105 in FY 2020, a 21% increase.
• The increase in passengers also contributed to the increase in operating revenue from Food and
Beverage and Parking. Food and Beverage revenue totaled $499,930 in FY 2021 versus $256,568
in FY 2020, a 95% increase. Parking Revenue totaled $420,035 in FY 2021 versus $290,968 in
FY 2020, a 44% increase.
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Overview of the Financial Statements. The discussion and analysis are intended to serve as an
introduction to the Airport's financial statements. The Airport's financial statements are comprised of the
basic financial statements, which include all revenue and expenses and required supplementary
information, which reflects changes in employer's share of net pension liability and employer's
contributions, along with the schedule of changes in the Airport's other post-employment benefits
("OPEB")liability and related ratios.
Basic Financial Statements. The Basic Financial Statements are made up of four components: (1)
Statement of Net Position; (2) Statement of Revenues, Expenses, and Changes in Net Position; (3)
Statement of Cash Flows; and (4) Notes to Financial Statements. These are designed to provide readers
with a broad overview of the Airport's finances, in a manner similar to a private sector business. The
financial statements are prepared in accordance with U.S. generally accepted accounting principles as
promulgated by the Government Accounting Standards Board ("GASB").
Required Supplementary Information. Required supplementary information consists of the Schedule of
the Airport's Proportionate Share of Net Pension Liability for the Florida Retirement System's ("FRS")
Pension Plan and the Health Insurance Subsidy ("HIS") programs; the Schedule of the Airport's
Contributions for FRS' Pension Plan and HIS programs, and the Schedule of Changes in the Airport's
total OPEB liability and related ratios.
Airport's Net Position (in thousands)
The following is a condensed summary of Net Position compared to the prior year.
(000's)
2021 2020 as restated
Current and Other Assets $ 22,317 S 15,521
Capital Assets 101,353 88,755
Total Assets 123,670 104,276
Deferred Outflows of Resources 1,093 1,745
Current Liabilities 3,735 3,387
Long-Term Liabilities 6,269 8,950
Total Liabilities 10,004 12,337
Deferred Inflows of Resources 2,376 367
Net Position:
Net Investment in Capital Assets 101,353 88,755
Restricted for Passenger Facility Charges 4,981 5,234
Unrestricted 9,784 2,714
Total Net Position $ 116,118 S 96,703
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In FY 2021, activities for the Airport increased total assets by $19.4 million, decreased deferred outflows
of resources by $.65 million, decreased total liabilities by $2.3 million, increased deferred inflows of
resources by $2 million and increased total net position by $19.4 million as compared to September 30,
2020.
Net investment in capital assets is the largest portion of net position. This represents capital assets net of
accumulated depreciation and outstanding debt used to acquire assets. The net investment in capital asset
balance increased $12.6 million, or 14.2 percent, in comparison to the prior year.
The restricted net position decreased $.25 million, or 4.8 percent, in comparison to the prior year. This
balance represents assets that are subject to external restrictions imposed by creditors, through bond
covenants, by grantors, or by law on how they are used. In FY 2021 and FY 2020, the Airport's net
position was restricted for Passenger Facility Charge ("PFC").
The remaining component of net position is unrestricted net position. Unrestricted net position may be
used to meet the Airport's ongoing obligations. The Airport's unrestricted net position balance increased
$7 million, or over 260.5 percent in comparison to the prior year. This significant increase in unrestricted
net position primarily relates to the financial assistance the Airport received from the federal government
under the Coronavirus Aid, Relief and Economic Security ("CARES") Act stimulus package. Under the
CARES Act,the FAA awarded funds to airports based on enplanements and other metrics related to cash
reserves and debt service. Of the $21.8 million in CARES Act funding,the Airport earmarked$17 million
to cover operating expenses. By September 30, 2021, the Airport was reimbursed $14.5 million, or 85.2
percent of the $17 million CARES grant. It is expected that the remaining $2.5 million will be expended
in FY 2022.
Comparison of Current Assets and Liabilities (in thousands)
A comparison of current assets to current liabilities can be a good indication of the Airport's ability to
meet its current and existing operational responsibilities. The fiscal year-end balance and ratios for the
current and prior fiscal years are as follows:
2021 2020
Current Assets $ 17,336 $ 10,287
Current Liabilities $ 3,735 $ 3,387
Ratio of Current Assets to
Current Liabilities 4.64 3.04
The schedule above demonstrates that the Airport continues to have adequate cash flows. The Airport's
ratio of 4.64 reflects the Airport's ability to pay back its current liabilities with available current assets.
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Airport Changes in Net Position (in thousands)
The Statement of Revenues, Expenses, and Changes in Net Position separately describe operating
revenues and operating expenses by logical categories; non-operating revenues made up of interest, PFC
reimbursements; operating grants, and capital contributions. The following table summarizes the changes
in net position for the current and previous year.
The Airport's total operating and non-operating revenues including capital contributions of almost $3.8
million exceeded total operating and non-operating expenses for increase in net position of$19.4 million.
A summary of revenues and expenses follows:
(000's)
2021 2020 as restated
Operating Revenues $ 11,421 $ 7,918
Operating Expenses 16,536 12,883
Loss from Operations (5,115) (4,965)
Non-operating Revenues and Expenses:
Operating Grants 18,182 6,510
Investment Income 27 130
Other Revenue 169 -
Total non-operating revenues and expenses 18,378 6,640
Net income before capital contributions 13,263 1,675
and transfers
Total Capital Contributions and Transfers 6,152 12,905
Change in Net Position 19,415 14,580
Net Position,October 1 96,703 89,504
Restatement-Prior Period Adjustment - (7,381)
Net Position,October 1,restated 96,703 82,123
Net Position, September 30 $ 116,118 $ 96,703
Summary of Revenues and Expense Analysis
In FY 2021, operating revenues increased in comparison to the prior fiscal year. During the fiscal year,
the Airport began recovering from the negative impacts of the coronavirus pandemic,that began to affect
the travel industry in March 2020. This is evident by the $3.5 million increase in the Airport's overall
operating revenue, or 44.3 percent, in comparison to the prior year. Specifically, from FY 2020 to FY
2021, the Airport's operating revenue generated from ground transportation doubled from $.2 million to
$.4 million while its car rental revenue increased from $1.3 million to $2.6 million. The Airport's landing
fees paid by various airlines showed an increase from $1.9 million to $3.4 million.
In total, charges for services revenues in FY 2021 amounted to $11.3 million or 31.0% of all business-
type activities revenue sources. Other revenue source increases include $6.6 million and $18.3 million in
capital grants and operating grants respectively.
Total expenses (excluding transfers to other funds) decreased 18.4% from FY 2020 to FY 2021. The
Airport's salaries, wages, and benefits decreased 22.6 percent. This reduction is related to the FRS'
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pension assets increasing significantly during FY 2021 which, in turn,reduced the related pension liability
and associated pension expense. All other expense categories increased during FY 2021 from the previous
fiscal year due to an uptick in the Airport's operations.
Operating grants increased significantly in FY 2021. In FY 2020, operating grants totaled over $1.2
million while FY 2021's total was almost $15.0 million. This increase can be attributed to the Airport's
work on improving the airfield and beginning its work on designing the Concourse A Terminal. While
operating grants increased this past year, capital grants correspondingly decreased. In FY 2020, Capital
Contributions totaled almost$11.8 million and in FY 2021 Capital Contributions were $3.8 million.
The following charts and tables summarize Net Revenues and Expenses for FY 2021.
Operating Revenue for Fiscal Year 2021
Ground Transportation, Intergovernmental Miscellaneous, $5,566
$405,516 Revenue, $124,899 ��°
....����.Airlien Rents,
yy '� " $1,639,351
rt ��ii���ilifii(�illlllllllllllllllllll���l�l�l,(IIIii � ��������i��
Car Rentals, $2,580,396 ----
Parking, $420,035 ���� Landing Fees,
$3,360,980
Concessions, $904,010
Other Rents, $775 019 ,
Terminal Rents, � Airline Security,
$611,281 $594,213
FY FY FY 2021 Increase/ %
2021 2020 %of Total (Decrease) Change
Operating Revenues
Airline Rents S 1,639,351 S 2,000,995 14.3% S (361,644) -18.1%
Landing Fees 3,360,980 1,936,704 29.4% 1,424,276 73.5%
Airline Security 594,213 411,378 5.2% 182,835 44.4%
Terminal Rents 611,281 512,416 5.4% 98,865 19.3%
Other Rents 775,019 519,596 6.8% 255,423 49.2%
Concessions 904,010 682,429 7.9% 221,581 32.5%
Parking 420,034 290,968 3.7% 129,066 44.4%
Car Rental 2,580,396 1,348,689 22.6% 1,231,707 91.3%
Ground Transportation 405,516 203,220 3.6% 202,296 99.5%
Intergovernmental Revenue 124,899 - 1.1% 124,899 N/A
Miscellaneous 5,566 11,231 0.0% (5,665) -50.4%
Total Operating Revenues S 11,421,265 S 7,917,626 100.0% S 3,503,639 44.3%
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011peratfing Expeinsesfor Fiscal Year 2021,
Depreciation Expense
$2,484,585 �Personnel Services,
$3,089,416
ailtlillllll��l�l Illlllllllllllllllllllttiioi Contractual Services,
�umu $4,009,154
Capital Outlay,
w
$4,640,292 o
I
Cher
$636,854
Expenses,
Repairs and Maintenance,
Promotional Activities, � $521,823
`•••Risl<Management,
$108,468 $167,246
FY FY FY 2021 Increase/ %
2021 2020 %of Total (Decrease) Change
Operating Expenses
Salaries &Wages S 2,504,492 $ 2,506,071 15.2% $ (1,579) -0.1%
Fringe Benefits 584,924 1,484,060 3.5% (899,136) -60.6%
Contractual Services 4,009,154 3,256,424 24.2% 752,730 23.1%
Travel and Per Diem 20,369 26,727 0.1% (6,358) -23.8%
Utilities 636,854 558,654 3.9% 78,200 14.0%
Rentals and Leases 29,239 23,836 0.2% 5,403 22.7%
Repairs and Maintenance 521,823 391,336 3.2% 130,487 33.3%
Risk Management 167,246 149,082 1.0% 18,164 12.2%
Printing Services 4,335 13,118 0.0% (8,783) -67.0%
Promotional Activities 108,468 10,042 0.7% 98,426 980.1%
Miscellaneous Expenses 552,811 845,337 3.3% (292,526) -34.6%
Other Supplies 271,404 220,813 1.6% 50,591 22.9%
Capital Outlay 4,640,292 196,955 28.1% 4,443,337 2256.0%
Depreciation Expense 2,484,585 3,200,064 15.0% (715,479) -22.4%
Total Operating Expenses S 16,535,996 S 12,882,519 100.0% $ 3,653,477 50.8%
C-6
Passenger Facility Charges
In 1992, the Board passed Resolution 357-1992 to allow the Airport to participate in the FAA's PFC
program. The purpose for establishing and implementing the PFC program was to ensure that the Airport's
passengers contribute to a greater degree toward the continued development of the Airport's facilities.
Initially, the FAA allowed the Airport to impose a PFC of $3.00 per eligible enplaned passenger but
increased this amount to $4.50 per eligible enplaned passenger in 2003.
The FAA oversees each public airport's PFC program by requiring each airport to apply to the FAA for
authority to impose a PFC for use on eligible projects. In FY 2019, the Airport received approval of its
PFC Application 418. In FY 2020, the FAA approved an amendment to this application. Among the ten
approved projects (amounts reflect total project cost):
• $7.1 million to rehabilitate taxiway A and taxiway A lighting;
• $5.3 million to rehabilitate the Airport's terminal customs facility;
• $2.1 million for modifications to the terminal departure area; and
• $.95 million for the design phase 1 of the new Concourse A project.
Capital Assets
Capital assets, net of accumulated depreciation, increased by almost $12.6 million. Major capital outlay
spending in FY 2021 included:
• Key West Customs Terminal Renovation $ 5,115,307
• Maintenance Storage Facility 3,200,768
• Baggage Handling System Expansion 1,771,341
• Departure Hall Renovations 1,692,296
The following table reflects a summary of the Airport's capital assets for FY 2021 and FY 2020.
Capital Assets
September 30, 2021 and 2020
FY 2021 FY 2020 as restated
Land $ 1,645,908 $ 1,167,486
Construction in Progress 11,691,571 9,740,101
Infrastructure 57,482,046 57,482,046
Buildings 61,587,587 49,807,875
Equipment 4,146,345 3,334,950
Subtotal 136,553,457 121,532,455
Less: Accumulated Depreciation (35,200,141) (32,777,550)
Total Capital Assets $101,353,316 $ 88,754,908
Additional information on the Airport's capital assets can be found in Note 4 to the financial statements
page E-11.
C-7
Debt Administration
In FY 2020-21, the Airport was issued a revolving line-of-credit taxable revenue note not to exceed $10
million to finance the costs associated with the Airport's Concourse A expansion. At September 30'', the
Airport had drawn $748,000 of the available $10 million. The Airport pledged eligible PFC revenues and
its available net revenue for repaying this debt.
Further details about long-term debt are available in Note 8 to the financial statements page E-25.
Airport Activities
The total passenger count for FY 2021 was 1,310,827, an increase of 94 percent over the prior fiscal year.
There was such a dramatic increase due to the negative impact of the global pandemic during the latter
half of FY 2020. FY 2021 reflects a recovery of tourism. The Airport added a number of nonstop flights
with existing airlines in addition to welcoming flights from Jet Blue and Allegiant airlines.
The following chart exhibits the total passenger market share for the six commercial airlines operating at
the Airport during FY 2021.
Fly 2021 EnplIanern nts Deplanern nts
JetBlue Allegiant
3%
United Airlines
...
13%
American Airlines
49%
Delta Airlines
26%
������ � 111JJJJJJJJJ((((((((ffffffffffI
����IIIIIIIIIIIIIIIII" Silver Airways
7%
Airline Rates and Charges
The Airport negotiated a new airline use agreement with participating airlines (referred to as Signatory
Airlines), with key terms of the agreement approved by the Board in the latter half of 2021. The
Agreements commenced on October 1, 2021, with a five-year term, expiring on September 30, 2026.
Rates for fees paid by airlines are adjusted annually in accordance with the methodology set forth in the
agreement. After proposing a schedule of rates for fees and charges for the upcoming fiscal year, the
C-8
Airport meets with the Signatory Airlines to agree upon a Final Statement of Rates. The Final Statement
of Rates is calculated based on the Airport's budget for the upcoming fiscal year. No later than May 3 Pt
of each year,the Airport uses the agreed-upon rate and fee schedule to recalculate the rates for the previous
fiscal year using actual financial data in order to provide the airlines with a final settlement amount either
due to the Airport or the Airline, if any.
Terminal premises are leased on an exclusive use, preferential use and joint use basis. The Airport will
lease certain terminal premises on a common use basis, as necessary. It is the intent of the Airport to
manage its terminal facilities in an efficient manner, while also respecting the schedule of its airline
parties. Ticket offices, operations offices, and baggage service offices are leased on an exclusive use basis.
Gate podium, ticket counter/ticket queuing, and operations space are leased on a preferential use basis.
Conveyor systems at the ticket counter, devices for baggage make-up and baggage claim activities,
outbound and inbound baggage claim carousels, hold room space, and passenger security screening
checkpoints are charged on a joint use basis. Joint use costs are allocated to the Signatory Airlines based
on twenty percent allocated to all Signatory Airlines equally, and eighty percent allocated to all Signatory
Airlines based on the ratio of each Signatory Airline's enplaned passengers annually at the Airport.
Landing fees are calculated based upon the total maximum weight of passenger and cargo aircraft per
1,000 pounds times the landing fee rate. Terminal rents are calculated using a commercial compensatory
method (i.e., rentable square foot divisor). Charges for the leasing of all terminal space will be assessed
on a square-footage basis. In FY 2021, the Signatory Airlines paid the Airport nearly $5.5 million.
Economic Factors and Budget Highlights
The following factors were considered for the Airport's budget preparation:
• The total number of passengers for FY 2021-22 year-to-date (October 2021 to January 2022) is
77.4% over the same period in FY 2021.
• The total adopted operating budget of$20 million is an increase of 12% from the previous fiscal
year due primarily to grant match required for capital projects.
• Increases in personnel costs were the result of annual cost-of-living and merit adjustments.
• Budgeted operating expenses remained relatively flat and are on target in FY 2021-22.
• The budgeted rates and charges are up 16%from FY 2020-21 due primarily to the Airline security
direct bill charge.
Requests for Information
This financial report is designed to provide a general overview of the Airport's finances for all those with
an interest in its finances. Questions concerning any of the information provided in this report or requests
for additional information should be addressed to the Finance Director, Monroe County Clerk of the
Courts and Comptroller, 500 Whitehead Street, Key West, Florida 33040.
C-9
KEY WEST INTERNATIONAL AIRPORT
MONROE COUNTY, FLORIDA
STATEMENT OF NET POSITION
SEPTEMBER 30, 2021
ASSETS
Current Assets:
Cash and Cash Equivalents $ 1,999,937
Investments 9,828,211
Accounts Receivable, Net 745,166
Due from County Agencies 2,141
Due from Other Governmental Units 4,542,064
Due from Monroe County Sheriff 198,329
Interest Receivable 19,877
Total Current Unrestricted Assets 17,335,725
Noncurrent Assets:
Restricted Cash and Cash Equivalents 4,574,038
Restricted Accounts Receivable 407,221
Land and Other Nondepreciable Assets 13,337,479
Capital Assets Depreciated, Net 88,015,837
Total Noncurrent Assets 106,334,575
Total Assets 123,670,300
DEFERRED OUTFLOWS OF RESOURCES
Related to Pensions 984,936
Related to OPEB 108,100
Total Deferred Outflows of Resources 1,093,036
LIABILITIES
Current Liabilities:
Accounts Payable 1,490,650
Retainage Payable 1,138,191
Accrued Wages and Benefits Payable 168,673
Due to Other Funds 58,483
Due to Other Governmental Units 14,684
Revenue Bonds Payable 748,000
Accrued Comp.Absences Payable 88,362
Unearned Revenues 19,757
Deposits in Escrow 8,000
Total Current Liabilities 3,734,800
The notes to the financial statements are an integral part of this statement.
D-1
KEY WEST INTERNATIONAL AIRPORT
MONROE COUNTY, FLORIDA
STATEMENT OF NET POSITION (CONTINUED)
SEPTEMBER 30, 2021
Noncurrent Liabilities:
Accrued Comp.Absences Payable $ 353,447
OPEB Liability 597,000
Net Pension Liability 1,583,601
Total Noncurrent Liabilities 2,534,048
Total Liabilities 6,268,848
DEFERRED INFLOWS OF RESOURCES
Related to Pensions 2,353,843
Related to OPEB 22,100
Total Deferred Inflows of Resources 2,375,943
NET POSITION
Investment in Capital Assets 101,353,316
Restricted for:
Passenger Facility Charges 4,981,259
Unrestricted 9,783,970
Total Net Position $ 116,118,545
The notes to the financial statements are an integral part of this statement.
D-2
KEY WEST INTERNATIONAL AIRPORT
MONROE COUNTY, FLORIDA
STATEMENT OF REVENUES, EXPENSES,
AND CHANGES IN NET POSITION
FOR THE YEAR ENDED SEPTEMBER 30,2021
Operating Revenues:
Airline Rents $ 1,639,351
Landing Fees 3,360,980
Airline Security 594,213
Terminal Rents 611,281
Other Rents 775,019
Concessions 904,010
Parking 420,034
Car Rental 2,580,396
Ground Transportation 405,516
Intergovernmental Revenue 124,899
Miscellaneous 5,566
Total Operating Revenues 11,421,265
Operating Expenses:
Personnel Services 3,089,416
Contractual Services 4,009,154
Travel and Per Diem 20,369
Utilities 636,854
Rentals and Leases 29,239
Repairs and Maintenance 521,823
Risk Management 167,246
Printing Services 4,335
Promotional Activities 108,468
Miscellaneous Expenses 552,811
Other Supplies 271,404
Capital Outlay 4,640,292
Depreciation 2,484,585
Total Operating Expenses 16,535,996
Operating Loss (5,114,731)
Nonoperating Revenues(Expenses):
CARES, CRSSA,ARPA Federal Stimulus Funds 9,063,498
Operating Grants 9,118,563
Grants and Donations-Other Sources 5,000
Investment Income 27,063
Settlements 150,000
Gain on Disposition of Assets 14,306
Total Non-Operating Revenues(Expenses) 18,378,430
Net Income Before Capital Contributions
and Transfers 13,263,699
Total Capital Contributions and Transfers:
Capital Contributions 3,790,312
Capital Contributions-Passenger Facility Charges 2,841,936
Transfers to Other Funds (480,239)
Total Capital Contributions and Transfers 6,152,009
Change in Net Position 19,415,708
Net Position-October 1,as previously reported 104,084,180
Restatement-Prior Period Adjustment (7,381,343)
Net Position-October 1, restated 96,702,837
Net Position-September 30 $ 116,118,545
The notes to the financial statements are an integral part of this statement.
D-3
KEY WEST INTERNATIONAL AIRPORT
MONROE COUNTY, FLORIDA
STATEMENT OF CASH FLOWS
FOR THE YEAR ENDED SEPTEMBER 30,2021
Operating Activities:
Cash Received for Services $ 11,198,407
Cash Payments to Suppliers for Goods and Services (10,782,255)
Cash Received from others 150,000
Cash Payments for Employee Services (3,326,670)
Cash Received from(Paid to)Other Sources (321,800)
Other Operating Revenue (14,275)
Net Cash Used In
Operating Activities (3,096,593)
Noncapital Financing Activities:
Operating Grants Received 18,182,061
Transfers to Other Funds (480,239)
Net Cash Provided by Noncapital
Financing Activities 17,701,822
Capital and Related Financing Activities:
Proceeds from Capital Grants 6,632,248
Acquisition of Capital Assets (15,068,684)
Proceeds from sale of capital assets 14,306
Net Cash Used in Capital and
Related Financing Activities (8,422,130)
Investing Activities:
Investment Income 27,063
Proceeds from Sales and Maturities of Investments 179,993
Purchase of Investment Securities (6,200,351)
Net Cash Used in Investing Activities (5,993,295)
Net Increase in Cash and
Cash Equivalents 189,804
Cash and Cash Equivalents:
October 1 6,384,171
September 30 $ 6,573,975
The notes to the financial statements are an integral part of this statement.
D-4
KEY WEST INTERNATIONAL AIRPORT
MONROE COUNTY, FLORIDA
STATEMENT OF CASH FLOWS (CONTINUED)
FOR THE YEAR ENDED SEPTEMBER 30,2021
Reconciliation of Operating Loss
to Net Cash Used in Operating
Activities:
Operating Loss $ (5,114,731)
Adjustments to Reconcile Operating Income (Loss)
to Net Cash Provided by(Used in)Operating
Activities:
Depreciation and Amortization 2,484,585
Nonoperating Income 150,000
Change in Assets, Liabilities, and Deferrals:
(Increase) Decrease in Accounts Receivable (199,088)
(Increase) Decrease in Due from Other Funds (2,141)
(Increase) Decrease in Due from Other Gov't Units (460,528)
(Increase) Decrease in Due from Constitutional Ofcrs 86,165
(Increase) Decrease in Interest Receivable (19,841)
Increase (Decrease)in Accounts Payable (1,083,405)
Increase (Decrease)in Retainage Payable 515,145
Increase (Decrease)in Accrued Wages/Benefits 135,406
Increase (Decrease)in Due to Other Funds -
Increase (Decrease)in Due to Other Gov't Units 54,704
Increase (Decrease)in Comp.Absences Payable (17,722)
Increase (Decrease)in Revenue Notes Payable 748,000
Increase (Decrease)in Unearned Revenue (18,204)
Increase (Decrease)in OPEB Liability 40,000
Increase (Decrease)in Pension Liability (3,055,358)
Increase (Decrease)in Deferred Outflows 651,787
Increase (Decrease)in Deferred Inflows 2,008,633
Total Adjustments 2,018,138
Net Cash Used in
Operating Activities $ (3,096,593)
Noncash Investing, Capital,and Financing Activities:
Increase (Decrease)in Revenues Notes Payable $ 748,000
Gain on Disposition of Assets 14,306
Gain on Disposition of Assets $ 762,306
Cash Reconciliation:
Unrestricted $ 1,999,937
Restricted 4,574,038
Total $ 6,573,975
The notes to the financial statements are an integral part of this statement.
D-5
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KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The following summary of the more significant accounting policies of the Key West International Airport
of Monroe County, Florida (the "Airport") is presented to assist the reader in interpreting these financial
statements and should be viewed as an integral part of this report.
Reporting Entity:
Monroe County, Florida (the "County")is a Non-Charter County established as provided by Article VIII
Section 1 of the Florida Constitution and Chapter 125, Florida Statutes. The primary government of the
County is comprised of the Board of County Commissioners (the "Board") and five "constitutional
officers": Clerk of the Circuit Court& Comptroller(the"Clerk"), Property Appraiser, Sheriff, Supervisor
of Elections, and Tax Collector.
The Board,composed of five members, acts as a local legislative and executive body,setting public policy,
levying taxes, and funding projects, programs, and the operations of county departments. The Board
appoints a county administrator to carry out the Board's policies and decisions. The Airport, a county
department, is managed by the Senior Director of Airports who reports directly to the county
administrator. Under the direction of the Clerk, the Monroe County Finance Department maintains the
accounting system for the Board's operations, including the Airport's operations.
Entity status for financial reporting purposes is governed by Statement No. 14, as amended. The Airport
is not operationally autonomous from the Board. Therefore, under GASB guidelines, the Airport is
reported as a part of Board's financial operations. The financial statements of the Board, when combined
with its blended component units and the constitutional officers, constitute the "primary government" of
Monroe County according to generally accepted accounting principles ("GAAP") for governmental
entities. The primary government constitutes the complete GAAP basis financial reporting entity of the
County,presented in the Monroe County Florida Annual Comprehensive Financial Report.
Measurement Focus and Basis of Accounting:
Basis of accounting refers to when revenues, expenditures, or expenses are recognized and reported in the
financial statements. Basis of accounting relates to timing of the measurements made, regardless of the
measurement focus applied. The Airport's basic financial statements are reported using the economic
resources measurement focus and the accrual basis of accounting. Revenues are recorded when earned
and expenses are recorded when a liability is incurred, regardless of the timing of related cash flows.
Grants and similar items are recognized as revenue as soon as all the eligibility requirements imposed by
the grantor have been met.
E-1
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
The Airport operates as an enterprise fund. The Airport distinguishes operating revenues and expenses
from nonoperating items in its statements of revenues, expenses, and changes in net position. The Airport
defines operating revenues and expenses as revenues earned and expenses incurred from aviation
operations and services provided to customers and tenants. Nonoperating revenues and expenses include
investment income, grants, donations and settlements.
Cash and Cash Equivalents:
The Airport's cash balances are pooled with other cash balances of other Board's funds for investment
purposes. Earnings from such investments are allocated to the respective funds based on applicable cash
participation by each fund. The investment pools are managed such that all participating funds have the
ability to deposit and withdraw cash as if they were demand deposit accounts. Therefore, all balances
representing participants' equity in the investment pools are classified as cash equivalents for purposes of
these statements. Investments held separately from the pools, and which are highly liquid (including
restricted assets)with an original or remaining maturity of 90 days or less,are considered cash equivalents.
Investments:
Section 218.415, Florida Statutes, authorizes local governments to invest its funds pursuant to a written
investment plan. The Board's written plan allows investment of surplus funds in the following:
1) U.S. Treasury & Government Guaranteed — U.S. Treasury obligations, and obligations the
principal and interest of which are backed or guaranteed by the full faith and credit of the U.S.
Government.
2) Federal Agency/Government Sponsored Enterprise ("GSE") — Debt obligations, participations or
other instruments issued or fully guaranteed by any U.S. Federal agency, instrumentality or GSE.
3) Supranationals — U.S. dollar denominated debt obligations of a multilateral organization of
governments where the U.S. is a shareholder and voting member.
4) Corporates —U.S. dollar denominated corporate notes, bonds, or other debt obligations issued or
guaranteed by a domestic corporation, financial institution, non-profit, or other entity.
5) Municipals — Obligations, including both taxable and tax-exempt, issued or guaranteed by any
State, territory, or possession of the U.S., political subdivision, public corporation, authority,
agency board, instrumentality or other unit of local government of any state or territory.
6) Agency Mortgage Backed Securities ("MBS") —MBS are backed by residential, multi-family or
commercial mortgages, that are issued or fully guaranteed as to principal and interest by a U.S.
Federal agency or government sponsored enterprise, including but not limited to pass-throughs,
collateralized mortgage obligations ("CMOs") and real estate mortgage investment conduits.
7) Asset-Backed Securities — Asset-backed securities ("ABS") whose underlying collateral consists
of loans, leases, or receivables, including but not limited to auto loans/leases, credit card
receivables, student loans, equipment loans/leases, or home-equity loans.
E-2
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
8) Non-Negotiable Certificate of Deposit and Savings Accounts — Non-negotiable interest-bearing
time certificates of deposit, or savings accounts in banks organized under the laws of the State of
Florida or in national banks organized under the laws of the United States and doing business in
Florida, provided that any such deposits are secured by the Florida Security for Public Deposits
Act, Chapter 280, Florida Statutes.
9) Commercial Paper — U.S. dollar denominated commercial paper issued or guaranteed by a
domestic corporation, company, financial institution, trust or other entity, only unsecured debt
permitted.
10) Bankers' Acceptances —Bankers' acceptances issued, drawn on, or guaranteed by a U.S. bank or
U.S. branch of a foreign bank.
11) Repurchase Agreements — Repurchase agreements that meet specific requirements listed in
Monroe County Resolution 032-2019.
12) Money Market Funds — Shares in open-end and no-load money market mutual funds, provided
such funds are registered under the Investment Company Act of 1940 and operate in accordance
with Rule 2a-7.
13) Intergovernmental Investment Pools — Intergovernmental Investment Pools that are authorized
pursuant to the Florida Interlocal Cooperation Act, as provided in Section 163.01,Florida Statutes.
All investments are stated at fair value or at amortized cost, which approximates fair value.
Use of Estimates:
The presentation of financial statements in conformity with GAAP, as applicable to governmental units,
requires management to make use of estimates that affect the reported amounts in the financial statements.
Actual results could differ from estimates, particularly given the significant social and economic
disruptions and uncertainties associated with the ongoing coronavirus pandemic and control responses.
Accounts Receivable:
Amounts due from private individuals, organizations, or other governments, which pertain to charges for
services rendered by the Airport, are reported as accounts receivable. Receivables are reviewed
periodically to establish or update the provisions for uncollectible amounts. These provisions are estimated
based on an analysis of the age of the various accounts.
E-3
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Interfund Balances and Activity:
Relationship with County Departments—The Airport reimburses the County's General Fund for its portion
of various transactions. Examples of these transactions include providing services, constructing assets,
matching grants, or servicing debt.
For the year ended September 30, 2021, the Airport recorded an expense in the amount of approximately
$480,239 for such transactions.
As of September 30, 2021,the Airport does not have any pending payments due to the County for various
services. For this same period, the Airport has receivables due from the County in the amount of$2,141.
Capital Assets:
Capital assets of the Airport include property, buildings, equipment, and infrastructure assets (e.g.
runways, terminal buildings, aprons, lighting systems). Constructed or purchased assets are recorded at
historical or estimated historical cost at the time of purchase. Donated assets are recorded at estimated
acquisition cost at the date of donation.
The Board requires the Airportto maintain a$1,000 threshold for additions to equipment with an estimated
useful life in excess of two years. Buildings are capitalized when the value is $15,000 or greater. Public
domain and infrastructure assets represent major expenditures for such items as roads, runways, aprons,
and drainage systems. Additions and improvements for infrastructure are capitalized when the cost
amounts to $250,000.
Depreciation has been provided using the straight-line method. The estimated useful lives of the various
classes of depreciable capital assets are as follows: buildings— 10 to 50 years; equipment—5 to 10 years;
intangible assets— 10 to 15 years; and infrastructure— 10 to 50 years.
Management evaluates whether there has been significant unexpected decline in the utility of a capital
asset that could indicate an impairment in the capital asset. If there is an indication that an asset may be
impaired, the Airport follows Governmental Accounting Standards Board ("GASB") Statement No. 42,
Accounting and Financial Reporting for Impairment of Capital Assets and for Insurance Recoveries, to
determine whether an impairment should be recognized. The Airport concluded that no impairment exists
at September 30, 2021.
Compensated Absences:
Board policy permits employees to accumulate a limited amount of annual and sick leave, which will be
paid to employees upon termination of employment. Accumulated annual and sick leave is accrued when
earned. An expense and a liability are recorded as the leave is earned.
E-4
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
Restricted Assets:
The use of certain assets is restricted by specific provisions of resolutions and agreements with various
parties. Assets so designated are identified as restricted assets on the balance sheet. When both restricted
and unrestricted resources are available for use, the hierarchy of Airport spending is to use restricted
resources first, followed by unrestricted resources, as they are needed. Restricted assets are classified as
noncurrent if they are for acquisition or construction of capital assets,for liquidation of long-term debt, or
are for other than current operations.
Deferred Inflows of Resources:
Deferred inflows of resources represent an acquisition of net position that applies to a future period and
therefore will not be recognized as an inflow of resources until that time. The Airport has two items that
qualify for reporting in this category: (1)Pension-related items; and(2)Other Post-Employment Benefits.
The Airport reports deferred inflows for pension-related and other post-employment benefit items as
actuarially determined.
Deferred Outflows of Resources:
Deferred outflows of resources represent a consumption of net position that applies to a future period and
therefore will not be recognized as an outflow of resources (expense) until that future time. The Airport
reports deferred outflows for pension-related and other post-employment benefit items as actuarially
determined.
Lone-Term Obligations:
Long-term obligations are reported as a liability in the Airport's statement of net position. Net pension
liabilities and other post-employment benefits are determined based on actuarial valuations. See Notes 8
and 9 for additional information.
Net Position:
Net position in the Airport's financial statements is classified into three categories:
• Net investment in capital assets— This component of net position consists of capital assets, net of
accumulated depreciation,reduced by the outstanding balances of any bonds, mortgages,notes, or
other borrowings that are attributable to the acquisition, construction, or improvement of those
assets. If there are significant unspent related debt proceeds at year-end, the portion of debt
attributable to the unspent proceeds is not included in the calculation of net investment in capital
assets. Rather, that portion of the debt is included in the same net position component as the
unspent proceeds.
E-5
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 1 — SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (continued)
• Restricted net position— This component of net position consists of amounts which have external
constraints paced on their use imposed by creditors (such as through debt covenants), grantors,
contributors, or laws or regulations of other governments or constraints imposed by law through
constitutional provisions or enabling legislation.
• Unrestricted net position — This component consists of net position that does not meet the
definition of"net investment in capital assets" or"restricted net position."
Revenue Recognition:
Passenger Facility Charge Revenue: The Aviation Safety and Capacity Expansion Act of 1990 (Public
Law 101-508, Title 11, Subtitle B) authorized the imposition of a local Passenger Facility Charge (PFC)
and use of the resulting PFC revenues for approved Federal Aviation Administration("FAA")project. On
July 16, 1992, the Board passed Resolution 357-1992 directing the Airport to apply to the FAA to allow
the Airport to collect and expend PFC revenue. A $4.50 PFC charge is imposed on enplaning passengers
for the purpose of generating resources for airport projects that increase capacity, increase safety, security,
or that mitigate noise impacts. PFCs may be collected one at a time and must be collected in consecutive
order of their approval. The excess (deficit) of amounts collected over amounts expended in each year is
recorded as capital contributions in the Statement of Revenues, Expenses, and Change in Net Position.
Cumulative amounts collected, yet unexpended at September 30, are reflected as net position restricted
for passenger facility projects in the Statement of Net Position.
Airfield Landing Fees: Landing fees are principally generated from scheduled passenger and cargo
carriers, as well as non-scheduled commercial aviation, and are based on maximum landed weight of the
aircraft. The estimated landing fee structure is determined annually pursuant to an agreement between the
Airport and each of the Signatory Airlines based on the Certified Gross Weight of the aircraft landed.
Landing fees are recognized as revenue when activity is completed.
Terminal Rents, Airline Rents, Car Rental, Parking, and Concessions: Rental and concession fees are
generated from airlines,parking facilities, food and beverage operations, rental car agencies, advertisers,
and other commercial tenants. Each October 1st,the Airport adjusts charges for leases sufficient to recover
the cost of operations (excluding certain debt service payments), maintenance, and debt service related to
the airfield and the space rented by the airlines. The rates and charges may also be adjusted by the Airport
if, at any time, during the fiscal year the rates are expected to vary by more than 10%from the established
rates.
Grant Revenue and Capital Contributions: Grants and similar items are recognized as revenue as soon as
all eligibility requirements imposed by the provider have been met.
E-6
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 2—CASH, CASH EQUIVALENTS,AND INVESTMENTS
All funds of the Airport are invested with the Board's cash and investment pool, which consists of the
Board's cash and investments. There are no restrictions on the Airport's ability to withdraw funds from
the Board's pool, so all amounts are considered cash and cash equivalents. All cash and cash equivalents
are stated at fair value, based on the Airport's investment portion of the fair value of the Board's pooled
investments. The Board's investment pool is not rated.
The Board categorizes its fair value measurements within the fair value hierarchy established by GAAP.
The hierarchy is based on the valuation inputs used to measure the fair value of the asset. Level 1 inputs
are unadjusted quoted prices in active markets for identical assets. Level 2 inputs are either directly or
indirectly observable for an asset(including quoted prices for similar assets), which may include inputs
in markets that are not considered active. Level 3 inputs securities are significant unobservable inputs.
Securities classified in Level 2 are evaluated prices from the custodian bank's primary external pricing
vendors. The pricing methodology involves the use of evaluation models such as matrix pricing which is
based on the securities' relationship to benchmark quoted prices. Other evaluation models use actual trade
data, collateral attributes, broker bids, new issue pricings and other observable market information.
There are no restrictions or limitations on withdrawals; however, FLCLASS may, on the occurrence of an
event that has a material impact on liquidity or operations, impose restrictions on withdrawals for up to
48 hours.
Credit Risk and Concentration of Credit Risk— The Board approved and adopted its Investment Policy
("Policy") in January 2019. The Policy outlines permitted investments, and establishes limitations on
portfolio composition, by both investment type and by issuer, in order to control concentration of credit
risk. The following table identifies the investment requirements and allocation limits on security types,
issuers, and maturities as established by the County.
Under the Policy, the Clerk has the option to further restrict investment percentages from time to time
based on market conditions, risk, and diversification strategies. The percentage allocation requirements
for investment types and issuers are calculated based on the original cost at the time of purchase of each
investment.
E-7
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 2—CASH, CASH EQUIVALENTS,AND INVESTMENTS (continued)
Portfolio Per Issuer
Investment Maximum Maximum Minimum Ratings Maximum
Type (%) (%) Requirement' Maturity
U.S.Treasury 100% 5.50 Years
GNMA 100% 40% N/A (5.50 Years
Other U.S. Government avg. life'
Guaranteed(e.g.AID,GTC) 10% for GNMA)
Federal Agency/GSE:
FNMA,FHLMC, 40%1
FHLB,FFCBS 75% N/A 5.50 Years
Federal Agency/GSE o
other than those above 10/o
Supranationals Highest ST or Highest LT Rating
where U.S.is a shareholder 25% 10% Categories 5.50 Years
and voting member (A-1/P-1,AAA/Aaa,or equivalent)
Highest ST or Three Highest
Corporates 50%1 5% LT Rating Categories 5.50 Years
(A-1/P-1,A-/A3 or equivalent)
Highest ST or Three Highest
Municipals 25% 5% LT Rating Categories 5.50 Years
SP-1/MIG 1,A-/A3,orequivalent)
Agency Mortgage-Backed 25% 40%' N/A 5.50 Years
Securities(MBS) Avg.Life'
Asset-Backed Securities o o Highest ST or LT Rating 5.50 Years
(ABS) 25/0 5/o (A-1+/P-1,AAA/Aaa,or equivalent) Avg.Life'
Non-Negotiable o None,if fully
Collateralized Bank Deposits 50/o collateralized None,if fully collateralized. 2 Years
or Savings Accounts
Commercial Paper(CP) 50%1 5% Highest ST Rating Category 270 Days
(A-1/P-1,or equivalent)
Bankers' Acceptances(BAs) 10%, 5% Highest ST Rating Category 180 Days
(A-1/P-1,or equivalent)
Counterparty(or if the counterparty is
not rated by an NRSRO,then the
Repurchase Agreements o counterparty's parent)must be rated in
(Repo or RP) 40/0 20/o the Highest ST Rating Category 1 Year
(A-1/P-1,or equivalent)
If the counterparty is a Federal
Reserve Bank,no rating is required
E-8
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 2—CASH, CASH EQUIVALENTS,AND INVESTMENTS (continued)
Portfolio Per Issuer
Investment Maximum Maximum Minimum Ratings Maximum
Type % % Requirement' Maturity
Highest Fund Quality and Volatility
Intergovernmental Pools 50% 25% Rating Categories by all NRSROs N/A
(LGIPs) who rate the LGIP,
(AAAm/AAAf, Sl,or equivalent)
Florida Local Government Highest Fund Rating by all NRSROs
Surplus Funds Trust Funds 25% N/A who rate the fund N/A
("Florida Prime") (AAAm/Aaa-mf,or equivalent)
Notes:
Rating by at least one SEC-registered Nationally Recognized Statistical Rating Organization("NRSRO"),unless otherwise noted.
ST=Short-term;LT=Long-term.
z Maximum allocation to all corporate and bank credit instruments is 50%combined.
3 Maximum exposure to any one Federal agency,including the combined holdings of Agency debt and Agency MBS,is 40%.
'The maturity limit for MBS and ABS is based on the expected average life at time of settlement,measured using Bloomberg or other
industry standard methods.
s Federal National Mortgage Association(FNMA);Federal Home Loan Mortgage Corporation(FHLMC);Federal Home Loan Bank or
its District banks(FHLB);Federal Farm Credit Bank(FFCB).
At September 30, 2021, the portion of the Board's investment portfolio invested in Federal
instrumentalities is detailed as follows:
Percent of
Investment
Issue Portfolio
Federal Agency Mortgage-Backed Security (MBS) 2.87%
Federal Agency Collateralized Mortgage Obligations (CMO) 1.93%
Federal Home Loan Mortgage Corporation (FHLMC) 1.50%
Custodial Credit Risk — The Policy requires bank deposits to be secured as provided by Chapter 280,
Florida Statutes. This law requires local governments to deposit funds only in financial institutions
designated as qualified public depositories by the Chief Financial Officer of the State of Florida. Demand
and time deposits are fully insured by the Federal Deposit Insurance Corporation for the first$250,000 at
each institution and the remaining balances are insured 100% by the State of Florida collateral pool, a
multiple institution pool with the ability to assess its members for collateral shortfalls if a member
institution fails.
E-9
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 2—CASH, CASH EQUIVALENTS,AND INVESTMENTS (continued)
The Policy requires execution of a third-parry custodial safekeeping agreement for all purchased securities
and requires that securities be held in the Board's name. As of September 30, 2021, all of the Airport's
investments are held in a bank's trust department in the Board's name.
Interest Rate Risk — The Policy limits the investment of three months of operating expenditures to 24
months. The Policy limits the investment of noncurrent operating funds to 5.50 years.
Restricted Cash and Cash Equivalents—The Airport has the following unrestricted and restricted cash and
cash equivalents at September 30, 2021:
Demand
Cash and Cash Equivalents Deposits
Unrestricted Cash and Cash Equivalents 1,999,937
Restricted Cash and Cash Equivalents 4,574,038
Total Cash and Cash Equivalents $6,573,975
NOTE 3—RESTRICTED ASSETS
Restricted assets for the Airport includes those assets created by resolutions adopted by the Board for the
Airport's passenger facility charges. Total restricted assets as of September 30, 2021 are as follows:
Cash and Cash Accounts
Equivalents Receivable Total
Key West Airport Passenger Facility Charges $4,574,038 $ 407,221 $4,981,259
NOTE 4—CAPITAL ASSETS
Amounts associated with the Airport's capital assets, related accumulated depreciation and depreciation
expense are reported on the Airport's financial statements.
Capital asset activity for the year ended September 30, 2021 is shown in the following table:
E-10
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 4—CAPITAL ASSETS (continued)
Beginning
Balance Ending
(as restated) Additions Reductions Balance
Capital assets not depreciated:
Land $ 1,167,486 $ 478,422 $ - $ 1,645,908
Construction in progress 9,740,101 18,371,475 (16,420,005) 11,691,571
Total capital assets not depreciated 10,907,587 18,849,897 (16,420,005) 13,337,479
Capital assets depreciated:
Buildings 49,807,875 11,779,712 - 61,587,587
Equipment 3,334,950 1,609,632 (798,240) 4,146,345
Infrastructure 57,482,046 - - 57,482,046
Total assets depreciated 110,624,871 13,389,344 (798,240) 123,215,978
Less accumulated depreciation for:
Buildings (14,825,591) (332,586) - (15,158,177)
Equipment (2,312,627) (1,054,328) 806,191 (2,560,764)
Infrastructure (15,639,332) (1,841,868) - (17,481,200)
Total accumulated depreciation (32,777,550) $ (3,228,782) $ 806,191 (35,200,141)
Total capital assets depreciated,net 77,847,321 88,015,837
Capital assets,net $ 88,754,908 $ 101,353,316
Depreciation expense for the year ended September 30, 2021 was $2,484,585.
NOTE 5—POST EMPLOYMENT BENEFITS OTHER THAN PENSION
General Information about the Other Post-Employment Benefits:
Plan Description—The Board administers a single-employer defined benefits healthcare plan(the"Plan").
Section 112.0801, Florida Statutes, requires the County to provide retirees and their eligible dependents
with the option to participate in the Plan if the County provides health insurance to its active employees
and their eligible dependents. The Plan provides medical coverage, prescription drug benefits, and life
insurance to both active and eligible retired employees. The Plan does not issue a publicly available
financial report.No assets are accumulated in a trust that meets the criteria as set forth in GASB Statement
No. 75.
The Board may amend the plan design,with changes to the benefits,premiums and/or levels of participant
contribution at any time. In an open session, on at least an annual basis and prior to the annual enrollment
process,the Board approves the rates for the coming calendar year for the retiree and County contributions.
The Plan includes participants from the Board and each Constitutional Officer. The Board is responsible
for funding all obligations not funded on a pay-as-you-go basis by Constitutional Officers. However, the
following disclosures are based on the Airport's share of the net Other Post-Employment Benefits
("OPEB") obligation.
E-11
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 5—POST EMPLOYMENT BENEFITS OTHER THAN PENSION (continued)
Benefits Provided — Employees who retire as active participants in the Plan and were hired on or after
October 1, 2001 may continue to participate in the Plan by paying the monthly premium established
annually by the Board. Employees who retire as active participants in the Plan,were hired before October
1, 2001, have at least ten years of full-time service with the County and meet the retirement criteria of the
Florida Retirement System ("FRS") but are not eligible for Medicare, may maintain group insurance
benefits with the County following retirement,provided that the retiring employee contributes the amounts
as shown in the following table.
Contribution as Percentage of Annual Actuarial Rate(')
Plan Years of Service with Monroe Count
Year 25+ 20-24 10-19
2018 HIS(2) 17% 18%
2019 HIS 18% 26%
2020 HIS 20% 34%
2021 HIS 22% 42%
2022 & Thereafter HIS 25% 50%
(1)The new retiree contributions began a five-year phased-in approach beginning January 1,2018.
(2)Participation in the Plan is at a cost equal to the FRS Health Insurance Subsidy(HIS)for ten
years of service (currently $5 per month for each year of service credit at retirement with a
minimum HIS payment of$30 and a maximum HIS payment of$150 per month).
Retirees who have met the requirements for early retirement,have not achieved age 60 and whose age and
years of service do not equal 70 (rule of 70)must pay the standard monthly premium until the age criteria
or the rule of 70 is met. At that time,the retiree's cost of participation will be based on the preceding table.
Surviving spouses and dependents of participating retirees may continue in the Plan if eligibility criteria
specific to those classes are met.
An employee who retires as an active participant in the Plan, was hired prior to October 1, 2001, has at
least ten years of full-time service with the County, and meets the retirement criteria of the FRS and is
eligible for Medicare at the time of retirement or becomes eligible for Medicare following retirement,may
maintain group health insurance benefits with the County following retirement, provided the retiring
employee contributes the Actuarial Rate for Medicare retirees as determined by the actuarial firm engaged
by the County, less a $250 per month County subsidy. Alternatively, retirees meeting these criteria may
elect to leave the County health plan and receive a$250 per month payment from the County,payable for
the lifetime of the retiree.
Employees Covered by Benefit Terms — Eligibility for post-employment participation in the Plan is
limited to full-time employees of the County and the Constitutional Officers.At September 30,2021,there
were no terminated employees entitled to deferred benefits. The membership of the Board's medical plan
consisted of:
E-12
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 5—POST EMPLOYMENT BENEFITS OTHER THAN PENSION (continued)
Active Employees 550
Retirees and Beneficiaries Currently Receiving Benefits 425
Total Membership 975
Contributions — The Board establishes, and may amend, the contribution requirements of Plan members.
The required contribution is based on pay-as-you-go financing requirements,net of member contributions.
Total OPEB Liability:
The Airport's total OPEB liability of $597,000 was measured as of September 30, 2021, and was
determined by an actuarial evaluation as of October 25, 2021.
Actuarial Methods and Assumptions — The valuation, dated October 25, 2021, was prepared using
generally accepted actuarial principles and practices, and relied on unaudited census data and medical
claims data reported by the Board.
The total OPEB liability for the Board's enterprise and internal service funds in the September 30, 2021
actuarial valuation was determined using the following actuarial assumptions and other inputs, applied to
all periods included in the measurement, unless otherwise specified:
Actuarial Cost Method Entry Age Normal based on level of percentage
of projected salary.
Inflation Rate 2.5%per annum
Salary Increase Rate 3.5%per annum
Discount Rate 2.21%per annum (Beginning of Year)
2.15%per annum (End of Year)
Source: Bond Buyer 20-Bond GO index
Marriage Rate The assumed percentage of married participants
at retirement is 25% and is based on the current
retired population of the BOCC.
Spouse Age Spouse dates of birth were provided by the
County. Where this information was missing,
male spouses were assumed to be three years
older than female spouses.
Medicare Eligibility All current and future retirees were assumed to
be eligible for Medicare at age 65.
E-13
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 5—POST EMPLOYMENT BENEFITS OTHER THAN PENSION (continued)
Amortization Method Experience/Assumptions gains and losses were
amortized over a closed period of 11.3 years
starting on October 1, 2019, equal to the
average remaining service of active and inactive
plan members (who have no future service).
Plan Participation Percentage The assumptions for participation of eligible
retirees in the County's postemployment
benefit plan are:
Retirees with 25+ Years of Service: 100%
Retirees with 20—24 Years of Service: 20%
Retirees with<20 Years of Service: 25%
The actuarial assumptions include an annual health care cost trend rates of 5.5% initially, reduced by
decrements of 0.5%to an ultimate rate of 4.5%. The assumptions included a discount rate tied to the return
expected on the funds used to pay the benefits, and assumes for an unfunded plan, that the benefits
continue to be funded on a pay-as-you-go basis.
Mortality rates were based on the Pub-2010 projected forward using the SOA scale MP-19.
Expected retiree claim costs were developed using 24 months historical claim experience through May
2020. Non-claim expenses are based on the current amounts charged per retired employee.
Changes in the Total OPEB Liability For the Airport:
Total OPEB
Liability
Balance at the beginning of the year $ 557,000
Changes for the year:
Service cost 29,200
Interest cost 12,900
Changes of benefit terms on January 1, 2021 -
Differences between expect and actual experiences -
Changes in assumptions or other inputs 3,500
Benefit payments (5,600)
Net change in total OPEB liability 40,000
Balance at the end of the year $ 597,000
E-14
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 5—POST EMPLOYMENT BENEFITS OTHER THAN PENSION (continued)
Sensitivity of the Total OPEB Liability to Changes in the Discount Rate—The following presents the total
OPEB liability of the Airport, as well as what the total OPEB liability for the Airport would be if it were
calculated using a discount rate that is 1-percentage-point lower (1.15%) or 1-percentage-point higher
(3.15%)than the current discount rate:
Current Discount
1% Decrease Rate 1% Increase
(115%) (215%) (315%)
Total OPEB Liability $692,500 $597,000 $537,300
Sensitivity of the Total OPEB Liability to Changes in the Healthcare Cost Trend Rates — The following
presents the total OPEB liability of the Airport, as well as what the total OPEB liability would be for the
Airport if it were calculated using a healthcare cost trend rates that are 1-percentage-point lower (4.5%
decreasing to 3.5%) or 1-percentage-point higher (6.5% decreasing to 5.5%) than the current healthcare
cost trend rates:
Healthcare Cost Trend Rates
1% Decrease Current Trend 1% Increase
(4.5%decreasing to (5.5%decreasing to (6.5%decreasing to
3.5%) 4.5%) 5.5%)
Total OPEB Liability $516,400 $597,000 $705,700
OPEB Expense and Deferred Outflows of Resources and Deferred Inflows of Resources Related to
OPEB
For the year ended September 30, 2021, the Airport recognized an OPEB expense of ($45,700). At
September 30,2021,the Airport reported deferred outflows of resources and deferred inflows of resources
related to the OPEB from the following sources:
Deferred Deferred
Outflows of Inflows of
Resources Resources
Changes of Assumptions or Other Inputs $ 108,100 $ 22,100
E-15
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 5—POST EMPLOYMENT BENEFITS OTHER THAN PENSION (continued)
The amounts the Airport's reported as deferred outflows of resources and deferred inflows of resources
related to OPEB will be recognized in OPEB expense as follows:
OPEB
For Fiscal Year: Amount
2022 $ 6,600
2023 6,600
2024 6,600
2025 8,000
2026 10,800
Thereafter 47,400
Total $ 86,000
NOTE 6—FLORIDA RETIREMENT SYSTEM RETIREMENT PLANS
General Information:
The Airport's employees participate in the Florida Retirement System (FRS). As provided by Chapters
121 and 112,Florida Statutes,the FRS provides two cost sharing, multiple employer defined benefit plans
administered by the Florida Department of Management Services, Division of Retirement, including the
FRS Pension Plan("Pension Plan")and the Retiree Health Insurance Subsidy("HIS Plan").Under Section
121.4501, Florida Statutes, the FRS also provides a defined contribution plan ("Investment Plan")
alternative to the FRS Pension Plan,which is administered by the State Board of Administration("SBA").
As a general rule membership in the FRS is compulsory for all employees working in a regularly
established position for a state agency, county government, district school board, state university,
community college, or a participating city or special district within the State of Florida. The FRS provides
retirement and disability benefits, annual cost-of-living adjustments, and death benefits to plan members
and beneficiaries. Benefits are established by Chapter 121, Florida Statutes, and Chapter 60S, Florida
Administrative Code. Amendments to the law can be made only by an act of the Florida State Legislature.
The State of Florida annually issues a publicly available financial report that includes financial statements
and required supplementary information for the FRS. The latest available report may be obtained by
writing to the State of Florida Division of Retirement, Department of Management Services, P.O. Box
9000, Tallahassee, Florida 32315-9000, or from the Web site:
www.dms.myflorida.com/workforce_operations/retirement/publications.
Pension Plan:
Plan Description — The Pension Plan is a cost-sharing multiple-employer defined benefit pension plan,
with a Deferred Retirement Option Program ("DROP")for eligible employees.
E-16
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 6—FLORIDA RETIREMENT SYSTEM RETIREMENT PLANS (continued)
Benefits Provided — Benefits under the Pension Plan are computed on the basis of age, average final
compensation, and service credit. For Pension Plan members enrolled before July 1, 2011, Regular class
members who retire at or after age 62 with at least six years of credited service or 30 years of service
regardless of age are entitled to a retirement benefit payable monthly for life, equal to 1.6% of their final
average compensation based on the five highest years of salary, for each year of credited service. Vested
members with less than 30 years of service may retire before age 62 and receive reduced retirement
benefits. All Airport employees are regular class member in the FRS.
For Plan members enrolled on or after July 1, 2011, the vesting requirement is extended to eight years of
credited service for all these members and increasing normal retirement to age 65 or 33 years of service
regardless of age for Regular class members. Also, the final average compensation for regular members
will be based on the eight highest years of salary.
As provided in Section 121.101, Florida Statutes, if the member is initially enrolled in the Pension Plan
before July 1, 2011, and all service credit was accrued before July 1, 2011, the annual cost-of-living
adjustment is 3% per year. If the member is initially enrolled before July 1, 2011, and has service
credit on or after July 1, 2011, there is an individually calculated cost-of-living adjustment. The annual
cost-of-living adjustment is a proportion of 3% determined by dividing the sum of the pre-July 2011
service credit by the total service credit at retirement multiplied by 3%. Plan members initially enrolled
on or after July 1, 2011, will not have a cost-of-living adjustment after retirement.
In addition to the above benefits, the DROP program allows eligible members to defer receipt of monthly
retirement benefit payments while continuing employment with a FRS employer for a period not to exceed
60 months after electing to participate. Deferred monthly benefits are held in the FRS Trust Fund and
accrue interest. There are no required contributions by DROP participants.
Contributions — Effective July 1, 2011, all enrolled members of the FRS, other than DROP participants,
are required to contribute 3%of their salary to the FRS.In addition to member contributions,governmental
employers are required to make contributions to the FRS based on state-wide contribution rates established
by the Florida Legislature. These rates are updated as of July 1 of each year. The employer contribution
rates by job class for the periods from October 1, 2020 through June 30, 2021 and from July 1, 2021
through September 30, 2021, respectively, were as follows: Regular10.00% and 10.82%; and DROP
participants16.98% and 18.34%. These employer contribution rates include 1.66% HIS Plan subsidy
for the periods October 1,2020 through June 30,2021 and from July 1,2021 through September 30,2021,
respectively.
The Airport's contributions, including employee contributions, to the Pension Plan totaled $318,603 for
the fiscal year ended September 30, 2021.
E-17
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 6—FLORIDA RETIREMENT SYSTEM RETIREMENT PLANS (continued)
Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of
Resources Related to Pensions—The Airport recognizes pension liabilities, pension expense and deferred
outflows of resources and deferred inflows of resources related to pensions on the accrual basis of
accounting. At September 30, 2021,the Airport reported a liability of$743,397 for its proportionate share
of the Pension Plan's net pension liability. The net pension liability was measured as of June 30, 2021,
and the total pension liability used to calculate the net pension liability was determined by an actuarial
valuation as of July 1, 2021. The Board's proportionate share of the net pension liability was based on the
Board's FY 2021 contributions relative to the FY 2021 contributions of all participating members. At June
30, 2021, the Board's proportionate share for all funds was 0.1272%, which was a decrease of 0.00063%
from its proportionate share measured as of June 30, 2020. Approximately 7.74% of the Board's
proportionate share of the net pension liability was allocated to the Airport based on its proportionate
share of the Board's Pension Plan contributions.
For the fiscal year ended September 30, 2021, the Airport recognized a pension benefit of $27,900. In
addition,these activities reported deferred outflows of resources and deferred inflows of resources related
to pensions from the following sources:
FRS Pension
Deferred Deferred
Outflows of Inflows of
Resources Resources
Differences Between Expected and Actual Experience $ 110,339 $ -
Changes of Assumptions 440,481 -
Net Difference Between Projected and Actual
Earnings on Pension Plan Investments - 2,245,855
Changes in Proportion and Differences Between
Pension Plan Contributions and Proportionate Share
of Contributions 154,081 58,507
Pension Plan Contributions Subsequent to
the Measurement Date 77,575 -
Total $ 782,476 $ 2,304,362
The Pension Plan's deferred outflows of resources related to the Airport contributions to the Pension Plan
subsequent to the measurement date,totaling $77,575,will be recognized as a reduction of the net pension
liability in the fiscal year ended September 30, 2022. Other amounts reported as deferred outflows of
resources and deferred inflows of resources related to the Pension Plan will be recognized in pension
expense of the Airport as follows:
E-18
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 6—FLORIDA RETIREMENT SYSTEM RETIREMENT PLANS (continued)
FRS
For Fiscal Year: Amount
2022 $ (281,705)
2023 (328,494)
2024 (435,129)
2025 (557,587)
2026 3,454
Total $ (1,599,461)
Actuarial Assumptions — The total pension liability in the June 30, 2021 actuarial valuation was
determined using the following actuarial assumptions, applied to all periods included in the measurement:
Inflation 2.40%
Salary increases 3.25%, average, including inflation
Investment rate of return 6.80%, net of pension plan investment
expense, including inflation
Mortality rates were based on the PUB2010 base table varies by member category and sex, projected
generationally with Scale MP-2018 details in the valuation report.
The actuarial assumptions used in the July 1, 2021, valuation were based on the results of an actuarial
experience study for the period July 1, 2013 through June 30, 2018.
The long-term expected rate of return remained at 6.80%, and the active member mortality assumption
was updated.
The long-term expected rate of return on Pension Plan investments was not based on historical returns,
but instead is based on a forward-looking capital market economic model. The allocation policy's
description of each asset class was used to map the target allocation to the asset classes shown below.
Each asset class assumption is based on a consistent set of underlying assumptions and includes an
adjustment for the inflation assumption. The target allocation and best estimates of arithmetic and
geometric real rates of return for each major asset class are summarized in the following table:
E-19
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 6—FLORIDA RETIREMENT SYSTEM RETIREMENT PLANS (continued)
Compound
Annual Annual
Target Arithmetic (Geometric) Standard
Asset Class Allocation Return Return Deviation
Cash 1.0% 2.1% 2.1% 1.1%
Fixed Income 20.0% 3.8% 3.7% 3.3%
Global Equity 54.2% 8.2% 6.7% 17.8%
Real Estate (Property) 10.3% 7.1% 6.2% 13.8%
Private Equity 10.8% 11.7% 8.5% 26.4%
Strategic Investments 3.7% 5.7% 5.4% 8.4%
Total 100.0%
Discount Rate — The discount rate used to measure the total pension liability was 6.80%. The Pension
Plan's fiduciary net position was projected to be available to make all projected future benefit payments
of current active and inactive employees. Therefore, the discount rate for calculation of the total pension
liability is equal to the long-term expected rate of return.
Sensitivity of the Board's Proportionate Share of the Net Position (Asset) Liability to Changes in the
Discount Rate — The following represents the Airport's proportionate share of the net pension (asset)
liability calculated using the discount rate of 6.80%, as well as what the proportionate share of the net
pension (asset) liability would be if it were calculated using a discount rate that is one percentage point
lower(5.80%) or one percentage point higher(7.80%)than the current rate:
FRS Net Pension (Asset) Liability
Current Discount
1% Decrease Rate 1% Increase
(5.80%) (6.80%) (7.80%)
Enterprise and Internal Service
Funds Proportionate Share of the
Net Pension Plan (Asset) Liability $3,324,123 $ 743,397 $(1,413,964)
Pension Plan Fiduciary Net Position — Detailed information regarding the Pension Plan's fiduciary net
position is available in the separately issued FRS Pension Plan and Other State-Administered Systems
Annual Comprehensive Financial Report.
E-20
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 6—FLORIDA RETIREMENT SYSTEM RETIREMENT PLANS (continued)
HIS Plan:
Plan Description — The HIS Plan is a cost-sharing multiple-employer defined benefit pension plan
established under Section 112.363,Florida Statutes, and may be amended by the Florida legislature at any
time. The benefit is a monthly payment to assist retirees of state-administered retirement systems in paying
their health insurance costs and is administered by the Florida Department of Management Services,
Division of Retirement.
Benefits Provided — For the fiscal year ended September 30, 2021, eligible retirees and beneficiaries
received a monthly HIS payment of $5 for each year of creditable service completed at the time of
retirement,with a minimum HIS payment of$30 and a maximum HIS payment of$150 per month. To be
eligible to receive these benefits,a retiree under a state-administered retirement system must provide proof
of health insurance coverage, which may include Medicare.
Contributions — The HIS Plan is funded by required contributions from FRS participating employers as
set by the Florida Legislature. Employer contributions are a percentage of gross compensation for all
active FRS members. For the fiscal year ended September 30, 2021, the HIS contribution for the period
October 1, 2020 through June 30, 2021 and from July 1, 2021 through September 30, 2021 was 1.66%
and 1.66%, respectively. The Airport contributed 100% of its statutorily required contributions for the
current and preceding three years. HIS Plan contributions are deposited in a separate trust fund from which
payments are authorized. HIS Plan benefits are not guaranteed and are subject to annual legislative
appropriation. In the event legislative appropriation or available funds fail to provide full subsidy benefits
to all participants, benefits may be reduced or cancelled.
The Airport's contributions to the HIS Plan totaled $41,656 for the fiscal year ended September 30, 2021.
Pension Liabilities, Pension Expense, and Deferred Outflows of Resources and Deferred Inflows of
Resources Related to Pensions—The basis of accounting and financial reporting of the Airport's HIS Plan
is identical to that of the Airport's Pension Plan. At September 30, 2021, the Airport reported a liability
of$840,204 for its proportionate share of the Board's HIS Plan's net pension liability. The net pension
liability was measured as of June 30, 2021, and the total pension liability used to calculate the net pension
liability was determined by an actuarial valuation as of July 1, 2021. The Board's proportionate share of
the net pension liability was based on the Board's FY 2021 contributions relative to the FY 2021
contributions of all participating members. At June 30, 2021, the Board's proportionate share of all funds
was 0.1188%, which was a decrease of 0.0012% from its proportionate share measured as of June 30,
2020. Approximately 5.76% of the Board's proportionate share of the net pension liability was allocated
to Airport based on its proportionate share of the Board's HIS Plan contributions.
For the fiscal year ended September 30, 2021, the Airport's total recognized HIS pension expense was
$78,970. In addition, these activities reported deferred outflows of resources and deferred inflows of
resources related to pensions from the following sources:
E-21
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 6—FLORIDA RETIREMENT SYSTEM RETIREMENT PLANS (continued)
HIS Pension
Deferred Deferred
Outflows of Inflows of
Resources Resources
Differences Between Expected and Actual Experience $ 30,191 $ 377
Changes of Assumptions 70,895 37,174
Net Difference Between Projected and Actual
Earnings on HIS Plan Investments 941 -
Changes in Proportion and Differences Between
HIS Plan Contributions and Proportionate Share
of Contributions 90,830 11,930
HIS Plan Contributions Subsequent to
the Measurement Date 9,603 -
Total $ 202,460 $ 49,481
The deferred outflows of resources related to the HIS Plan resulting from the Airport's contributions to
the HIS Plan subsequent to the measurement date, totaling $9,603, will be recognized as a reduction of
the net pension liability in the fiscal year ended September 30, 2022. Other amounts reported as deferred
outflows of resources and deferred inflows of resources related to the HIS Plan will be recognized as
pension expense by the Airport as follows:
HIS
For Fiscal Year: Amount
2022 $ 39,491
2023 12,581
2024 25,957
2025 34,455
2026 25,768
Thereafter 5,124
Total $ 143,376
Actuarial Assumptions—The total pension liability in the July 1,2021, actuarial valuation was determined
using the following actuarial assumptions, applied to all periods included in the measurement:
Inflation 2.40%
Salary increases 3.25%, average, including inflation
Municipal bond rate 2.21%
Mortality rates were based on the Generational RP-2010 with Projection Scale MP-2018 tables.
The actuarial assumptions used in the July 1, 2021 valuation were based on the results of an actuarial
experience study for the period July 1, 2013 through June 30, 2018.
E-22
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 6—FLORIDA RETIREMENT SYSTEM RETIREMENT PLANS (continued)
The municipal rate used to determine total pension liability decreased from 3.50%to 2.21%.
Discount Rate — The discount rate used to measure the total pension liability was 2.21%. In general, the
discount rate for calculating the total pension liability is equal to the single rate equivalent to discounting
at the long-term expected rate of return for benefit payments prior to the projected depletion date. Because
the HIS benefit is essentially funded on a pay-as-you-go basis, the depletion date is considered to be
immediate, and the single equivalent discount rate is equal to the municipal bond rate selected by the HIS
Plan sponsor. The Bond Buyer General Obligation 20-Bond Municipal Bond Index was adopted as the
applicable municipal bond index.
Sensitivity of the Board's Proportionate Share of the Net Position Liability to Changes in the Discount
Rate — The following represents the Airport's proportionate share of the net pension liability calculated
using the discount rate of 2.16%, as well as what the proportionate share of the net pension liability would
be if it were calculated using a discount rate that is 1-percentage point lower (1.16%) or 1-percentage
point higher(3.16%)than the current rate:
HIS Net Pension Liability
Current Discount
1% Decrease Rate 1% Increase
(1.16%) (2.16%) (3.16%)
Enterprise and Internal Service
Funds Proportionate Share
of the Net HIS Plan Liability $ 971,358 $ 840,204 $ 732,754
Pension Plan Fiduciary Net Position—Detailed information regarding the HIS Plan's fiduciary net position
is available in the separately issued FRS Pension Plan and Other State-Administered Systems Annual
Comprehensive Financial Report.
Investment Plan:
The SBA administers the defined contribution plan officially titled the FRS Investment Plan. The
Investment Plan is reported in the SBA's annual financial statements and in the State of Florida Annual
Comprehensive Financial Report.
E-23
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 6—FLORIDA RETIREMENT SYSTEM RETIREMENT PLANS (continued)
As provided in Section 121.4501, Florida Statutes, eligible FRS members may elect to participate in the
Investment Plan in lieu of the FRS defined benefit plan. Airport employees participating in DROP
are not eligible to participate in the Investment Plan. Employer and employee contributions, including
amounts contributed to individual member's accounts, are defined by law, but the ultimate benefit
depends in part on the performance of investment funds. Benefit terms, including contribution
requirements, for the Investment Plan are established and may be amended by the Florida Legislature.
The Investment Plan is funded with the same employer and employee contribution rates that are based
on salary and membership class, as the Pension Plan. Contributions are directed to individual member
accounts, and the individual members allocate contributions and account balances among various
approved investment choices. Costs of administering the Investment Plan, including the FRS Financial
Guidance Program, are funded through an employer contribution of 0.04% and 0.06% of payroll and
by forfeited benefits of plan members for the periods October 1, 2020 through June 30, 2021 and from
July 1, 2021 through September 30, 2021, respectively. Allocations to an investment member's accounts
during the F Y 2021, as established by Section 121.72, Florida Statutes, are based on a percentage of
gross compensation, by membership class. For Regular members this was 6.30%.
For all membership classes, employees are immediately vested in their own contributions and are vested
after one year of service for employer contributions and investment earnings. If an accumulated benefit
obligation for service credit originally earned under the Pension Plan is transferred to the Investment
Plan, the member must have the years of service required for Pension Plan vesting(including the service
credit represented by the transferred funds) to be vested for these funds and the earnings on the funds.
Non-vested employer contributions are placed in a suspense account for up to five years. If the employee
returns to FRS-covered employment within the five-year period, the employee will regain control over
their account. If the employee does not return within the five-year period, the employee will forfeit
the accumulated account balance. For the fiscal year ended September 30, 2021, the information for
the amount of forfeitures was unavailable from the SBA; however, management believes that these
amounts, if any, would be immaterial to the Airport.
After termination and applying to receive benefits, the member may rollover vested funds to another
qualified plan, structure a periodic payment under the Investment Plan, receive a hump sum distribution,
leave the funds invested for future distribution, or any combination of these options. Disability
coverage is provided; the member may either transfer the account balance to the Pension Plan when
approved for disability retirement to receive guaranteed lifetime monthly benefits under the Pension
Plan or remain in the Investment Plan and rely upon that account balance for retirement income.
The Airport's total recognized pension expense for the Investment Plan for the fiscal year ended
September 30, 2021, was $71,979.
E-24
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 7—CAPITAL AND OTHER SIGNIFICANT COMMITMENTS
For the fiscal year ended September 30, 2021, the Airport had outstanding engineering and construction
contracts in the amount of$1,453,087 as detailed below. The major funding sources for the capital projects
are grants awarded by federal and state agencies and other entities along with eligible PFC revenues.
Airfield Improvements $ 322,113
Taxiway A Rehabilitation 307,734
Maintenance Building 269,176
Noise Improvement Process—Key West By The Sea 195,821
Aircraft Overflow Parking 182,514
Customs Building 175,729
Total $1,453,087
In addition, on September 15, 2021, the Airport entered into a Construction Manager at Risk (CMAR)
contract with NV2A Gulf Keystar Joint Venture for the Airport's Concourse A and Terminal
Improvements capital project. This agreement was for pre-construction activities and the costs of these
services will be agreed upon once the scope of services and deliverables are established and detailed in
the Scope Guaranteed Maximum Price Amendment to the contract.
Operating Leases - The Airport's rental expense under cancelable operating leases for the current year
amounted to $29,239.
NOTE 8—LONG-TERM DEBT
Long-term debt activity for the year ended September 30, 2021 is as follows:
Current Portion
Beginning Ending of Long-terns
Balances Additions Payments Balances Liabilities
Revenue Notes from Direct Borrowings $ - $ 748,000 $ - $ 748,000 $ 748,000
Accrued Comp.Absences 459,531 213,338 231,060 441,809 88,362
OPEB Liability 557,000 273,900 233,900 597,000 -
Pension Liability-FRS&HIS 4,638,959 3,055,358 1,583,601 -
Total Long Term Debt 5,655,490 1,235,238 3,520,318 3,370,410 836,362
The Airport has an outstanding revenue note from direct borrowings totaling $748,000 at fiscal year-end.
The taxable revenue note was for a $10 million revolving line of credit to address the Airport's need for
interim financing of various capital improvement projects in connection with Airport's Concourse A
Expansion Project. The revenue note allows the Airport to manage its short-term cash flow. The Airport
pledged its net revenues and eligible PFC revenues in accordance with the PFC Act and the PFC Authority.
E-25
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 8—LONGTERM DEBT (continued)
The following summary reflects the Airport's revenue note as of September 30, 2021:
Revenue Notes From Direct Borrowings:
Key West International Airport $10 Million Revolving Line of Credit $ 748,000
• Final maturity: June 30, 2023
• Principal payment date: Principal of all draws are due and payable on the final maturity date.
• Interest payment dates: Payable quarterly in arrears on the first day of January, April, July, and
October of each year.
• Interest rate: Lesser of(i) the greater of(A) the Prime Rate plus 3% annum, or (B)the Overnight
Bank funding Rate plus 3.5%per annum, or(C)7%per annum, or(ii)the maximum rate permitted
by law.
• Amount outstanding at September 30th: $748,000. Loan amount not to exceed $10,000,000.
• Reserve requirement: None
• Revenue pledged: Net revenue and eligible Passenger Facility Charge (PFC) Revenues in
accordance with the PFC Act and the PFC Authority. For the fiscal year, no principal or interest
was paid, and total pledged revenue was $2,841,935.
• Purpose: Projects and capital improvements for the Key West International Airport.
• Call provisions: None
Debt Service Funding Requirements — The total annual debt service requirements for the Airport's note
outstanding at September 30, 2021 are as follows:
Key West International Airport Activities
Principal Interest Total
2022 $ 748,000 $ 509 $ 748,509
Total Required Debt Service $ 748,000 $ 509 $ 748,509
E-26
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 9—RISK MANAGEMENT
The Airport is exposed to various risks of loss related to tort;theft of, damage to, and destruction of assets;
errors and omissions; injuries to employees; and natural disasters. The Airport participates in the coverage
provided by the Board for Workers' Compensation, Group Insurance, and Risk Management Internal
Service Funds.
Under these programs, Workers' Compensation provides $500,000 coverage per claim for regular
employees. Workers' Compensation claims in excess of the self-insured coverage are covered by an
excess insurance policy. Risk Management has a$5,000,000 excess insurance policy for general liability
claims with a $200,000 self-insured retention, and building property damage is covered for the actual
value of the building with a deductible of$50,000. Deductibles for windstorm and flood vary by location.
Monroe County purchases commercial insurance for claims in excess of coverage provided by the funds
and for all other risks of loss. Settled claims have not exceeded this commercial coverage in any of the
past three years.
The Airport makes payments to the Workers' Compensation, Group Insurance and Risk Management
Funds based on estimates of the amounts needed to pay prior and current year claims.
NOTE 10—LITIGATION AND CLAIMS
The Airport is a parry form time to time in various lawsuits and other claims incidental to the ordinary
course of its operation, some of which are covered by the Board's self-insurance program. While the
results of litigation cannot be predicted with certainty, management believes the final outcome of such
litigation will not have a material adverse effect on the Airport's financial position.
NOTE 11 —COMMITMENTS AND CONTINGENCIES
Grant Programs — The Airport participates in a number of federal and state grant programs that are
governed by various rules and regulations of the grantor agencies. Amounts received or receivable from
grant agencies are subject to financial and compliance audits by the grantors or their representatives. Any
disallowed claims, including amounts already collected, may constitute a liability of the applicable funds.
The amount, if any, which may be disallowed by the grantor, cannot be determined at this time, although
the Airport expects such amounts, if any, to be immaterial.
E-27
KEY WEST INTERNATONAL AIRPORT-MONROE COUNTY, FLORIDA
Notes To Financial Statements
For the Year Ended September 30, 2021
NOTE 12—RESTATEMENT
During the year ended September 30, 2021, management discovered items previously reported as
additions to construction in progress that were prior period expenses. Beginning net position and
beginning capital assets balance have been restated as follows:
Key West
Airport Fund
Net position at September 30, 2020, as previously reported $ 104,084,180
Restatement (7,381,343)
Net position at September 30, 2020, as restated $ 96,702,837
Capital assets at September 30, 2020, as previously reported $ 96,136,251
Restatement (7,381,343)
Capital assets at September 30, 2020, as restated $ 88,754,908
NOTE 13— SUBSEQUENT EVENTS
Management has evaluated subsequent events through March 31,2022, in connection with the preparation
of these financial statements, which is the date the financial statements were available to be issued.
E-28
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REQUIRED
SUPPLEMENTARY INFORMATION
KEY WEST INTERNATIONAL AIRPORT-MONROE COUNTY, FLORIDA
SCHEDULE OF THE AIRPORT'S PROPORTIONATE SHARE OF NET PENSION LIABILITY
FLORIDA RETIREMENT SYSTEM PENSION PLAN
LAST TEN FISCAL YEARS*
2021 2020 2019
Airport's proportion of the net pension liability 0.127836047% 0.127836047% 0.122381778%
Airport's proportionate share of the net pension liability $ 743,397 $ 3,811,648 $ 2,973,628
Airport's covered payroll $ 1,716,713 $ 1,711,681 $ 1,428,795
Airport's proportionate share of the net pension liability as a
percentage of its covered payroll 43.30% 222.68% 208.12%
Plan fiduciary net position as a percentage of the total pension liability 78.85% 78.85% 82.61%
*The amounts presented for each fiscal year were determined as of June 30.
No data is available for the previous two years.
F-1
2018 2017 2016 2015 2014
0.129013726% 0.110416195% 0.107471975% 0.103158114% 0.104891393%
$ 2,762,545 $ 2,357,006 $ 1,996,602 $ 962,376 $ 942,826
$ 1,380,380 $ 1,256,856 $ 1,229,068 $ 1,125,913 $ 944,464
200.13% 187.53% 162.45% 85.48% 99.83%
84.26% 83.89% 84.88% 92.00% 96.09%
F-2
KEY WEST INTERNATIONAL AIRPORT-MONROE COUNTY,FLORIDA
SCHEDULE OF THE AIRPORT'S CONTRIBUTIONS
FLORIDA RETIREMENT SYSTEM PENSION PLAN
LAST TEN FISCAL YEARS*
2021 2020 2019
Contractually required contribution $ 318,603 $ 279,252 $ 228,057
Contributions in relation to the contractually required contributions (318,603) (279,252) (228,057)
Contribution deficiency(excess) $ - $ - $ -
Airport's covered payroll $ 1,726,305 $ 1,783,910 $ 1,580,101
Contributions as a percentage of covered payroll 18.46% 15.65% 14.43%
*The amounts presented for each fiscal year were determined as of September 30.
No data is available for the previous two years.
F-3
2018 2017 2016 2015 2014
$ 231,876 $ 206,623 $ 196,304 $ 181,589 $ 165,884
(231,876) (206,623) (196,304) (181,589) (165,884)
$ 1,588,892 $ 1,435,357 $ 1,732,902 $ 1,570,787 $ 1,281,282
14.59% 14.40% 11.33% 11.56% 12.95%
F-4
KEY WEST INTERNATIONAL AIRPORT-MONROE COUNTY,FLORIDA
SCHEDULE OF THE AIRPORT'S PROPORTIONATE SHARE OF NET PENSION LIABILITY
HEALTH INSURANCE SUBSIDY PROGRAM
LAST TEN FISCAL YEARS*
2021 2020 2019
Airport's proportion of the net pension liability 0.117668137% 0.1 1 76681 37% 0.110141787%
Airport's proportionate share of the net pension liability $ 840,204 $ 827,311 $ 705,948
Airport's covered payroll $ 1,716,713 $ 1,711,681 $ 1,428,795
Airport's proportionate share of the net pension liability as a
percentage of its covered payroll 48.94% 48.33% 49.41%
Plan fiduciary net position as a percentage of the total pension liability 3.00% 3.00% 2.63%
*The amounts presented for each fiscal year were determined as of June 30.
No data is available for the previous two years.
F-5
2018 2017 2016 2015 2014
0.113326095% 0.098952229% 0.095343347% 0.093902398% 0.093727524%
$ 687,673 $ 607,323 $ 637,305 $ 546,424 $ 549,761
$ 1,380,380 $ 1,256,856 $ 1,229,068 $ 1,125,913 $ 944,464
49.82% 48.32% 51.85% 48.53% 58.21%
2.15% 1.64% 0.97% 0.50% 0.99%
F-6
KEY WEST INTERNATIONAL AIRPORT-MONROE COUNTY, FLORIDA
SCHEDULE OF THE AIRPORT'S CONTRIBUTIONS
HEALTH INSURANCE SUBSIDY PROGRAM
LAST TEN FISCAL YEARS*
2021 2020 2019
Contractually required contribution $ 41,656 $ 40,976 $ 34,503
Contributions in relation to the contractually required contributions (41,656) (40,976) (34,503)
Contribution deficiency(excess) $ - $ - $ -
Airport's covered payroll $ 1,726,305 $ 1,783,910 $ 1,580,101
Contributions as a percentage of covered payroll 2.41% 2.30% 2.18%
*The amounts presented for each fiscal year were determined as of September 30.
No data is available for the previous two years.
F-7
2018 2017 2016 2015 2014
$ 35,684 $ 24,573 $ 28,931 $ 20,496 $ 18,334
(35,684) (24,573) (28,931) (20,496) (18,334)
$ 1,588,892 $ 1,435,357 $ 1,732,902 $ 1,570,787 $ 1,281,282
2.25% 1.71% 1.67% 1.30% 1.43%
F-8
KEY WEST INTERNATIONAL AIRPORT-MONROE COUNTY,FLORIDA
REQUIRED SUPPLEMENTARY INFORMATION
SCHEDULE OF CHANGES IN THE AIRPORT'S TOTAL OPEB LIABILITY AND RELATED RATIOS
LAST TEN FISCAL YEARS*
2021 2020 2019 2018
Total OPEB liability
Service cost $ 29,200 $ 23,100 $ 17,243 $ 16,551
Interest 12,900 15,200 19,835 37,165
Changes of benefit terms - - - (402,380)
Changes in assumptions or other inputs 3,500 259,700 72,886 (8,455)
Benefit payments (5,600) (291,000) (32,906) (2,868)
Net change in total OPEB liability 40,000 7,000 77,058 (359,987)
Total OPEB liability-Beginning of Year 557,000 550,000 469,000 828,987
Total OPEB liability-End of Year $ 597,000 $ 557,000 $ 546,058 $ 469,000
Covered-employee payroll $ 2,504,492 $ 2,506,071 $ 2,097,974 $ 2,032,728
Total OPEB liability as a percentage of covered-employee payroll 23.84% 22.23% 26.03% 23.07%
Notes to Schedule:
No assets are accumulated in a trust that meets the criteria in paragraph 4 of GASB Statement No.75.
Effective January 1,2018,the Board implemented cost-saving benefit changes for its other postemployment benefit plan.These included premium rates that are
calculated based on expected retiree costs for Medicare retirees and lower premium subsidies for eligible retirees.
Changes include updating the mortality to be a generational table with updated projection scales as published by the Society of Actuaries,an interest rate using 20-year
bond rates,and a change in Actuarial Cost methodology to the Entry Age Normal method.
*This schedule should present information for the last ten years.However,until a full ten years of information can be compiled,information will be presented for as many
years as are available.
F-9