HomeMy WebLinkAboutFiscal Years 2010 and 2009 Single Audit Nantucket Memorial Airport
NANTUCKET MEMORIAL AIRPORT
REPORT ON EXAMINATION OF
FINANCIAL STATEMENTS
FISCAL YEARS ENDED JUNE 30, 2010 AND 2009
NANTUCKET MEMORIAL AIRPORT
REPORT ON EXAMINATION OF FINANCIAL STATEMENTS
JUNE 30, 2010 AND 2009
TABLE OF CONTENTS
Page
Independent Auditors’ Report..........................................................................................................................................1
Management’s Discussion and Analysis.........................................................................................................................3
Financial Statements.......................................................................................................................................................8
Statement of Net Assets..............................................................................................................................................9
Statement of Revenues, Expenses and Changes in Fund Net Assets .....................................................................10
Statement of Cash Flows...........................................................................................................................................11
Notes to Financial Statements...................................................................................................................................12
Required Supplementary Information............................................................................................................................27
Retirement System Schedules...................................................................................................................................28
Retirement System Schedule of Funding Progress...............................................................................................29
Retirement System Schedule of Employer Contributions......................................................................................30
Other Postemployment Schedules ............................................................................................................................31
Other Postemployment Benefit Plan Schedule of Funding Progress and Employer Contributions.......................32
Other Postemployment Benefit Plan Actuarial Methods and Assumptions...........................................................33
Notes to Required Supplementary Information..........................................................................................................34
1
Independent Auditors’ Report
To the Nantucket Airport Commission
Nantucket Memorial Airport
Nantucket, Massachusetts
We have audited the accompanying financial statements of the Nantucket Memorial Airport, an enterprise fund of
the Town Nantucket, Massachusetts, as of and for the fiscal years ended June 30, 2010 and 2009, as listed in the
table of contents. These financial statements are the responsibility of the Town of Nantucket Massachusetts’
management. Our responsibility is to express opinions 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 includes
examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation. We believe that our audit provides a reasonable basis
for our opinions.
These financial statements present only the Nantucket Memorial Airport and do not purport to, and do not present
fairly, as discussed in Note 1, the financial position of the Town of Nantucket, Massachusetts, as of June 30, 2010
and 2009, and the changes in its financial position or, where applicable, its cash flows for the years then ended in
conformity with accounting principles generally accepted in the United States of America.
In our opinion, based on our audit, the financial statements referred to above present fairly, in all material
respects, the respective financial position of the Nantucket Memorial Airport as of June 30, 2010 and 2009, and
the respective changes in financial position and cash flows, thereof for the fiscal years then ended in conformity
with accounting principles generally accepted in the United States of America.
In accordance with Government Auditing Standards, we have also issued our report dated February 28, 2011, on
our consideration of the Town of Nantucket, Massachusetts’ internal control over financial reporting and our tests
of its compliance with certain provisions of laws, regulations, contracts, grant agreements and other matters. That
report was issued in conjunction with the audit of the Nantucket Memorial Airport, which is an enterprise fund of
the Town of Nantucket, Massachusetts. The purpose of that report is 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 internal control over financial reporting or on compliance. That report is an integral part of an audit
performed in accordance with Government Auditing Standards and should be read in conjunction with this report
in considering the results of our audit.
Management’s discussion and analysis, located on the following pages, the retirement system schedule of
funding progress, retirement system schedule of employer contributions, other postemployment benefit plan
schedule of funding progress and employer contributions and other postemployment benefit plan actuarial
methods and assumptions located after the notes to the financial statements, are not a required part of the
financial statements but are supplementary information required by accounting principles generally accepted in
2
the United States of America. We have applied certain limited procedures, which consisted principally of inquiries
of management regarding the methods of measurement and presentation of the required supplementary
information. However, we did not audit the information and express no opinion on it.
February 28, 2011
Nantucket Memorial Airport 3 Financial Statements
Management’s Discussion and Analysis
Nantucket Memorial Airport 4 Financial Statements
Management’s Discussion and Analysis
As management of the Nantucket Memorial Airport (the Airport), we offer readers of these financial statements
this narrative overview and analysis of the financial activities for the fiscal years ended June 30, 2010 and 2009.
The Airport complies with financial reporting requirements issued by the Governmental Accounting Standards
Board (GASB), and Management’s Discussion and Analysis are part of these requirements. The GASB is the
authoritative standards-setting body that provides guidance on the preparation of financial statements in
conformity with Generally Accepted Accounting Principles (GAAP). The Airport’s performance is discussed and
analyzed within the context of the accompanying financial statements and disclosures following this section.
Overview of the Financial Statements
This discussion and analysis are intended to serve as an introduction to the Nantucket Memorial Airport’s financial
statements. The financial statements include the Statement of Net Assets, the Statement of Revenue, Expenses
and Change in Fund Net Assets, the Statement of Cash Flows and the notes to the financial statements.
The Statement of Net Assets presents information on all assets and liabilities, with the difference between the
two reported as net assets. Over time, increases or decreases in net assets may serve as a useful indicator of
whether the financial position is improving or deteriorating.
The Statement of Revenues, Expenses and Changes in Fund Net Assets presents information showing how
the Airport’s net assets changed during the most recent fiscal years. All changes in net assets are reported as
soon as the underlying event giving rise to the change occurs, regardless of the timing of related cash flows.
Thus, revenues and expenses are reported in this statement for some items that will only result in cash flows in
future fiscal periods (e.g., uncollected fees and earned but unused vacation leave).
The Statement of Cashflows presents information showing the cash inflows and outflows for the Airport.
Notes to the financial statements. The notes provide additional information that is essential to a full
understanding of the data provided in the financial statements.
Financial Highlights Fiscal 2010 and 2009
• The total of assets exceeded liabilities (i.e., net assets) by $48.2 million and $44.9 million respectively.
• Unrestricted net assets for the Airport totaled $267,000 and $4.6 million respectively.
• Total debt totaled $27 million and $28.4 million respectively.
Nantucket Memorial Airport 5 Financial Statements
Financial Analysis
The following chart provides a summary of the Airport’s financial data for fiscal year 2010, with comparative fiscal
year 2009 information.
2010 2009
Assets:
Current assets……………………………………………$ 23,049,652 $ 28,254,958
Capital assets, not being depreciated………………… 9,382,257 31,168,222
Capital assets, net of accumulated depreciation…… 47,328,946 17,996,901
Total assets………………………………………… 79,760,855 77,420,081
Liabilities:
Current liabilities (excluding debt)…………………… 3,084,074 3,371,236
Noncurrent liabilities (excluding debt)………………… 1,410,783 693,905
Current debt……………………………………………… 25,596,500 26,292,725
Noncurrent debt………………………………………… 1,440,000 2,120,000
Total liabilities……………………………………… 31,531,357 32,477,866
Net Assets:
Invested in capital assets net of related debt………… 47,962,783 40,310,517
Unrestricted……………………………………………… 266,715 4,631,698
Total net assets……………………………………$48,229,498 $44,942,215
Operating Revenues:
Charges for services……………………………………$ 9,612,444 $ 10,999,153
Nonoperating Revenues:
Investment income……………………………………… 132,093 152,895
Intergovernmental capital grants……………………… 7,245,682 15,460,573
Total revenues……………………………………… 16,990,219 26,612,621
Operating Expenses:
Cost of services and administration…………………… 9,735,740 8,800,253
Depreciation……………………………………………… 1,859,907 1,513,167
Employee benefits……………………………………… 1,464,838 1,303,480
Interest expense………………………………………… 481,430 295,983
Total expenses…………………………………… 13,541,915 11,912,883
Transfers…………………………………………………… (161,021) -
Change in net assets…………………………………… $ 3,287,283 $ 14,699,738
There was a net increase of $3.3 million in net assets related to the Airport which is a decrease from the prior
year of approximately $11.4 million. Net assets were increased due mainly due to the recognition of $7.2 million
in capital grants. Net assets were decreased through decreased revenues and increases in operating costs over
prior years.
Noncurrent liabilities included an accrued liability for other postemployment benefits totaling $1,146,350 in fiscal
year 2010. This liability totaled $464,626 in fiscal year 2009, which was the initial year the Airport implemented
GASB Statement No. 45, Accounting and Financial Reporting by Employers for Postemployment Benefits Other
Than Pensions (OPEB).
Nantucket Memorial Airport 6 Financial Statements
Capital Asset and Debt Administration
Capital Assets
The Airport’s year end capital assets totaled $56.7 million which represented an increase of $7.5 million from the
prior year. Major current additions included various building and improvement projects, infrastructure additions,
machinery and equipment, and furniture and fixtures all totaling approximately $9.4 million. Depreciation of
approximately $1.9 million was recorded in fiscal 2010.
Debt
At the end of the fiscal years 2010 and 2009, the Nantucket Memorial Airport had total bonded debt outstanding
of $27 million and $28.4 million, respectively. Of this amount, $24.9 million and $25.6 million is in short-term
notes and the remaining $2.1 million and $2.9 million is outstanding long-term debt. This amount is fully
supported by the revenue of the Airport, and does not rely upon a general fund subsidy.
2010 2009
Short-term debt……………………………………$ 24,916,500 $ 25562725
Current portion of long-term debt……………… 680,000 730000
Noncurrent portion of long-term debt…………… 1,440,000 2,120,000
Total………………………………………………$ 27,036,500 $ 28,412,725
Please refer to the notes to the financial statements for further discussion of the major capital assets and debt
activity.
Requests for Information
This financial report is designed to provide a general overview of the Nantucket Memorial Airport finances for all
those with an interest in the finances. Questions concerning any of the information provided in this report or
requests for additional financial information should be addressed to the Nantucket Memorial Airport at 14 Airport
Road, Nantucket, Massachusetts 02554, or to the Finance Department of the Town of Nantucket at 16 Broad
Street, Nantucket, Massachusetts 02554.
Nantucket Memorial Airport 7 Financial Statements
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Nantucket Memorial Airport 8 Financial Statements
Financial Statements
2010 2009
ASSETS
CURRENT:
Cash and cash equivalents……………………………… $ 19,301,736 $ 23,450,717
Receivables, net of allowance for uncollectibles:
User fees………………………………………………… 173,930 453,819
Intergovernmental……………………………………… 2,563,416 3,892,815
Inventory…………………………………………………… 305,078 457,607
Due from other funds……………………………………… 705,492 -
Total current assets………………………………… 23,049,652 28,254,958
NONCURRENT:
Capital assets, not being depreciated…………………… 9,382,257 31,168,222
Capital assets, net of accumulated depreciation……… 47,328,946 17,996,901
Total noncurrent assets…………………………… 56,711,203 49,165,123
TOTAL ASSETS……………………………………………… 79,760,855 77,420,081
LIABILITIES
CURRENT:
Warrants payable…………………………………………… 2,095,737 2,503,479
Accrued payroll……………………………………………… 118,398 106,010
Security deposits…………………………………………… 348,998 336,330
Accrued interest…………………………………………… 147,968 87,458
Other liabilities……………………………………………… 295,855 53,750
Due to other funds………………………………………… 11,010 226,889
Compensated absences…………………………………… 66,108 57,320
Notes payable……………………………………………… 24,916,500 25,562,725
Bonds payable……………………………………………… 680,000 730,000
Total current liabilities……………………………… 28,680,574 29,663,961
NONCURRENT:
Compensated absences…………………………………… 264,433 229,279
Other postemployment benefits…………………………… 1,146,350 464,626
Bonds payable……………………………………………… 1,440,000 2,120,000
Total noncurrent liabilities………………………… 2,850,783 2,813,905
TOTAL LIABILITIES…………………………………………… 31,531,357 32,477,866
NET ASSETS
Invested in capital assets, net of related debt……………… 47,962,783 40,310,517
Unrestricted……………………………………………………… 266,715 4,631,698
TOTAL NET ASSETS…………………………………………$ 48,229,498 $ 44,942,215
See notes to financial statements.
JUNE 30, 2010 AND 2009
STATEMENT OF NET ASSETS
NANTUCKET MEMORIAL AIRPORT
Nantucket Memorial Airport 9 Financial Statements
2010 2009
OPERATING REVENUES:
Charges for services……………………………………… $ 9,612,444 $ 10,999,153
OPERATING EXPENSES:
Cost of services and administration……………………… 9,735,740 8,800,253
Depreciation………………………………………………… 1,859,907 1,513,167
Employee benefits………………………………………… 1,464,838 1,303,480
TOTAL OPERATING EXPENSES…………………… 13,060,485 11,616,900
OPERATING INCOME (LOSS)……………………… (3,448,041) (617,747)
NONOPERATING REVENUES (EXPENSES):
Investment income………………………………………… 132,093 152,895
Interest expense…………………………………………… (481,430) (295,983)
Intergovernmental capital grants………………………… 7,245,682 15,460,573
TOTAL NONOPERATING
REVENUES (EXPENSES), NET…………………… 6,896,345 15,317,485
INCOME (LOSS) BEFORE TRANSFERS AND
CAPITAL CONTRIBUTIONS………………...……… 3,448,304 14,699,738
Transfers in……………………………………………………… 997 -
Transfers out…………………………………………………… (162,018) -
Total Transfers…………………………………………… (161,021) -
CHANGE IN NET ASSETS………………………………… 3,287,283 14,699,738
NET ASSETS AT BEGINNING OF YEAR…………………… 44,942,215 30,242,477
NET ASSETS AT END OF YEAR……………………………$ 48,229,498 $ 44,942,215
See notes to financial statements.
FISCAL YEAR ENDED JUNE 30, 2010 AND 2009
STATEMENT OF REVENUES, EXPENSES AND CHANGES IN FUND NET ASSETS
NANTUCKET MEMORIAL AIRPORT
Nantucket Memorial Airport 10 Financial Statements
2010 2009
CASH FLOWS FROM OPERATING ACTIVITIES:
Receipts from customers and users…………………………………………………………… $ 9,892,333 $ 10,887,136
Payments to vendors……………………………………………………………………………… (4,603,183) (5,058,638)
Payments to employees…………………………………………………………………………… (3,870,357) (3,367,916)
Payments for interfund services used…………………………………………………………… (1,464,838) (1,303,480)
NET CASH FROM OPERATING ACTIVITIES…………………………………………………… (46,045) 1,157,102
CASH FLOWS FROM NONCAPITAL FINANCING ACTIVITIES:
Transfers in………………………………………………………………………………………… 997 -
Transfers out……………………………………………………………………………………… (162,018) -
Advances (to) from other funds………………………………………………………………… (921,371) 182,761
NET CASH FROM NONCAPITAL FINANCING ACTIVITIES…………………………………… (1,082,392) 182,761
CASH FLOWS FROM CAPITAL AND RELATED FINANCING ACTIVITIES:
Proceeds from the issuance of bonds and notes……………………………………………… - 16,850,000
Capital grants……………………………………………………………………………………… 8,575,081 13,688,985
Acquisition and construction of capital assets………………………………………………… (9,930,573) (17,772,321)
Principal payments on bonds and notes………………………………………………………… (1,376,225) (732,312)
Interest expense…………………………………………………………………………………… (420,920) (314,707)
NET CASH FROM CAPITAL AND RELATED FINANCING ACTIVITIES……………………… (3,152,637) 11,719,645
CASH FLOWS FROM INVESTING ACTIVITIES:
Investment income………………………………………………………………………………… 132,093 152,895
NET CHANGE IN CASH AND CASH EQUIVALENTS…………………………………………… (4,148,981) 13,212,403
CASH AND CASH EQUIVALENTS AT BEGINNING OF YEAR………………………………… 23,450,717 10,238,314
CASH AND CASH EQUIVALENTS AT END OF YEAR………………………………………… $ 19,301,736 23,450,717
RECONCILIATION OF OPERATING INCOME (LOSS) TO NET CASH
FROM OPERATING ACTIVITIES:
Operating income (loss)……………………………………………………………………………$ (3,448,041) (617,747)
Adjustments to reconcile operating income (loss) to net
cash from operating activities:
Depreciation…………………………………………………………………………………… 1,859,907 1,513,167
User fees…………………………………………………………………………………… 279,889 (112,017)
Inventory…………………………………………………………………………………… 152,529 191,504
Prepaid expenses………………………………………………………………………… - 19,876
Warrants payable…………………………………………………………………………… 116,844 (440,008)
Security deposits………………………………...………………………………………… 12,668 27,233
Accrued payroll……………………………………………………………………………… 12,388 20,952
Other liabilities……………………………………………………………………………… 242,105 2,450
Accrued compensated absences………………………………………………………… 43,942 87,066
Other postemployment benefits…………………………………………………………… 681,724 464,626
Total adjustments……………………………………………………………………… 3,401,996 1,774,849
NET CASH FROM OPERATING ACTIVITIES…………………………………………………… $ (46,045) $ 1,157,102
See notes to financial statements.
FISCAL YEAR ENDED JUNE 30, 2010 AND 2009
STATEMENT OF CASH FLOWS
NANTUCKET MEMORIAL AIRPORT
Nantucket Memorial Airport 11 Financial Statements
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 12 Financial Statements
NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
Notes to Financial Statements
The accompanying financial statements present the Nantucket Memorial Airport (the Airport) an enterprise fund of
the Town of Nantucket, Massachusetts. These statements are not intended to and do not present fairly the
financial position of the Town of Nantucket, Massachusetts. These statements have been prepared in accordance
with accounting principles generally accepted in the United States of America (GAAP). The Governmental
Accounting Standards Board (GASB) is the recognized standard-setting body for establishing governmental
accounting and financial reporting principles. The significant accounting policies are described herein.
A. Reporting Entity
The Nantucket Memorial Airport is an enterprise fund of the Town of Nantucket. Its operation is governed by the
Nantucket Memorial Airport Commission.
B. Measurement Focus. Basis of Accounting and Financial Statement Presentation
The Nantucket Memorial Airport’s financial statements are presented using the flow of economic resources
measurement focus and the accrual basis of accounting. Under this method, revenues are recognized when
earned and expenses are recorded when the liabilities are incurred. The operation of the Airport is accounted for
as an enterprise fund, which is a proprietary fund type.
Proprietary funds distinguish operating revenues and expenses from nonoperating items. Operating revenues
and expenses generally result from providing services and producing and delivering goods in connection with the
proprietary funds principal ongoing operations. All revenues and expenses not meeting this definition are
reported as nonoperating revenues and expenses.
The Airport applies all Financial Accounting Standards Board (FASB) pronouncements issued on or prior to
November 30, 1989, unless those pronouncements conflict with or contradict GASB pronouncements.
C. Cash and Investments
Cash and cash equivalents are considered to be cash on hand, demand deposits and short-term investments with
an original maturity of three months or less from the date of acquisition. Investments are carried at fair value.
D. Accounts Receivable
The recognition of revenue related to accounts receivable reported are reported under the accrual basis of
accounting.
Intergovernmental
Various federal and state grants for operating and capital purposes are applied for and received annually. For
non-expenditure driven grants, receivables are recorded as soon as all eligibility requirements imposed by the
provider have been met. For expenditure driven grants, receivables are recorded when the qualifying
expenditures are incurred and all other grant requirements are met.
These receivables are considered 100% collectible and therefore do not report an allowance for uncollectibles.
Airport User Fees
The outstanding receivable for Airport Fees is comprised primarily of fuel sales.
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 13 Financial Statements
E. Inventories
Inventories of the Nantucket Memorial Airport are priced at the lower of cost or market, with cost being
determined on the first-in, first-out method basis. Expendable supplies and small tools are not inventoried but
rather expensed when purchased.
F. Capital Assets
Capital assets, which include land; land improvements; buildings; vehicle; machinery and equipment; and
furniture, fixtures and computer equipment, are reported in the statements. Capital assets are recorded at
historical cost or at estimated historical cost when actual historical cost could not be determined. Donated capital
assets are recorded at the estimated fair market value at the date of donation. Construction period interest is
capitalized on constructed capital assets.
All purchases and construction costs in excess of $10,000 are capitalized at the date of acquisition or
construction, respectively, with expected useful lives of greater than one year.
Capital assets (excluding land) are depreciated on a straight-line basis. The estimated useful lives of capital
assets are as follows:
Estimated
Useful
Life
(in years)
Vehicles……………………………………………… 5
Furniture, fixtures and computer equipment………… 5-10
Machinary and equipment…………………………… 10-15
Land improvements…………………………………… 40-70
Buildings………………………………………………… 33-50
Capital Asset Type
The cost of normal maintenance and repairs that do not add to the value of the assets or materially extend asset
lives are not capitalized and are treated as expenses when incurred. Improvements are capitalized.
G. Net Assets
Net assets are reported as restricted when amounts are not available for appropriation or are legally restricted by
outside parties for a specific future use.
H. Long-term debt
Long-term debt is reported as liabilities in the statement of net assets. Material bond premiums and discounts are
deferred and amortized over the life of the bonds using the effective interest method. Bonds payable are reported
net of the applicable bond premium or discount.
I. Advertising
The Airport’s policy is to expense advertising costs the first time the advertising takes place. Advertising expense
for the years ended June 30, 2010 and 2009 totaled $5,285 and $9,327, respectively.
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 14 Financial Statements
J. Compensated Absences
Employees are granted sick leave in varying amounts based on collective bargaining agreements, state laws and
executive policies.
Vested or accumulated vacation and sick leave, which will be liquidated with expendable available financial
resources, is reported as an expense and a liability.
K. Use of Estimates
The preparation of financial statements in conformity with GAAP requires management to make estimates and
assumptions that affect the reported amounts of assets and liabilities and disclosure for contingent assets and
liabilities at the date of the financial statements and the reported amounts of the revenues and expenses during
the fiscal year. Actual results could vary from estimates that were used.
NOTE 2 – CASH AND INVESTMENTS
The Town Treasurer, at times, commingles other Town cash accounts with those specifically related to the
Airport. The Airports’ portion of these funds are reported on the Statement of Net Assets as Cash and Cash
Equivalents.
Statutes authorize the investment in obligations of the U.S. Treasury, agencies, and instrumentalities, certificates
of deposit, repurchase agreements, money market accounts, bank deposits and the State Treasurer's Investment
Pool (the Pool).
The Pool meets the criteria of an external investment pool. The Pool is administered by the Massachusetts
Municipal Depository Trust (MMDT), which was established by the Treasurer of the Commonwealth who serves
as Trustee. The fair value of the position in the Pool is the same as the value of the Pool shares.
Custodial Credit Risk – Deposits
In the case of deposits, this is the risk that in the event of a bank failure, the Nantucket Memorial Airport’s
deposits may not be returned to it. The Airport does not have a deposit policy for custodial credit risk.
At fiscal year-end June 30, 2010 and 2009, the carrying amount of deposits totaled $18,560,921 and
$22,486,347, respectively and the bank balance totaled $18,328,292 and $24,131,199 respectively. Of the bank
balance, $250,000 and $250,000 were covered by the Federal Depositors Insurance Company (“FDIC”),
$18,078,292 and $23,881,199 were collateralized, therefore the Airport did not have funds that were exposed to
custodial credit risk because of being uninsured or uncollateralized.
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 15 Financial Statements
Investments
As of June 30, 2010, the Nantucket Memorial Airport had the following investments:
Under
Fair Value 1 Year
Investment Type:
Repurchase Agreements………………………………… $ 94,200 $ 94,200
Other Investments:
MMDT………………………………………………………… 646,615
Total Investments.......................................................... $ 740,815
Maturity
As of June 30, 2009, the Nantucket Memorial Airport had the following investments:
Maturity
Under
Fair Value 1 Year
Investment Type:
Repurchase Agreements………………………………… $ 320,580 $ 320,580
Other Investments:
MMDT………………………………………………………… 643,790
Total Investments.......................................................... $ 964,370
The Airport participates in MMDT, which maintains a cash portfolio and short-term bond fund with combined
average maturities of approximately 3 months. Credit ratings associated with the Airport’s investment in MMDT
ranged from A1/P1 to unrated; with approximately 98% rated A1/P1 and approximately 2% rated A2/P2.
Custodial Credit Risk – Investments
For an investment, this is the risk that, in the event of a failure by the counterparty, the Airport will not be able to
recover the value of its investments or collateral security that are in the possession of an outside party. The
Airport does not have an investment policy for custodial credit risk.
Interest Rate Risk
The Airport does not have a formal investment policy that limits investment maturities as a means of managing its
exposure to fair value losses arising from increasing interest rates.
Credit Risk
The Airport has not adopted a formal policy related to Credit Risk.
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 16 Financial Statements
Concentration of Credit Risk
The Airport places no limit on the amount that they may invest in any one issuer.
More than 5% of the Airport’s investments are in the following securities for 2010:
Percentage of
Issuer
Repurchase Agreements…………………………………… 13%
MMDT………………………………………………………… 87%
Total Investments
More than 5% of the Airport’s investments are in the following securities for 2009:
Percentage of
Issuer
Repurchase Agreements…………………………………… 33%
MMDT………………………………………………………… 67%
Total Investments
NOTE 3 – RECEIVABLES
At June 30, 2010 and 2009, receivables for the Airport consist of the following:
2010 Receivables:
Allowance
Gross for Net
Amount Uncollectibles Amount
Receivables:
Airport fees………………………………………………$ 248,930 $ (75,000) $ 173,930
Intergovernmental……………………………………… 2,563,416 - 2,563,416
Total………………………………………………………$ 2,812,346 $ (75,000) $ 2,737,346
2009 Receivables:
Allowance
Gross for Net
Amount Uncollectibles Amount
Receivables:
Airport fees………………………………………………$ 528,819 $ (75,000) $ 453,819
Intergovernmental……………………………………… 3,892,815 - 3,892,815
Total………………………………………………………$ 4,421,634 $ (75,000) $ 4,346,634
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 17 Financial Statements
NOTE 4 – CAPITAL ASSETS
Capital asset activity for the Nantucket Memorial Airport for the fiscal year ended June 30, 2010, was as follows:
Beginning Ending
Balance Increases Decreases Balance
Capital assets not being depreciated:
Land…………………………………………………………$ 2,434,312 $ - $ - $ 2,434,312
Construction in progress………………………………… 28,733,910 9,112,107 (30,898,072) 6,947,945
Total capital assets not being depreciated………… 31,168,222 9,112,107 (30,898,072) 9,382,257
Capital assets being depreciated:
Land improvements……………………………………… 24,554,894 465,309 - 25,020,203
Buildings…………………………………………………… 9,507,075 30,215,506 - 39,722,581
Vehicles…………………………………………………… 3,566,916 83,826 - 3,650,742
Machinery and equipment………………………………… 914,316 415,992 - 1,330,308
Furniture, fixtures and computer equipment…………… 176,419 11,320 - 187,739
Total capital assets being depreciated……………… 38,719,620 31,191,953 - 69,911,573
Less accumulated depreciation……………………………… (20,722,719) (1,859,908) - (22,582,627)
Total capital assets being depreciated, net………………… 17,996,901 29,332,045 - 47,328,946
Total capital assets………………………………………………$ 49,165,123 $ 38,444,152 $ (30,898,072) $ 56,711,203
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 18 Financial Statements
Capital asset activity for the Nantucket Memorial Airport for the fiscal year ended June 30, 2009, was as follows:
Beginning Ending
Balance Increases Decreases Balance
Capital assets not being depreciated:
Land…………………………………………………………$ 2,434,312 $ - $ - $ 2,434,312
Construction in progress………………………………… 10,054,386 18,679,524 - 28,733,910
Total capital assets not being depreciated………… 12,488,698 18,679,524 - 31,168,222
Capital assets being depreciated:
Infrastructure……………………………………………… 24,554,894 - - 24,554,894
Buildings…………………………………………………… 9,371,310 135,765 - 9,507,075
Vehicles…………………………………………………… 3,566,916 - - 3,566,916
Machinery and equipment………………………………… 82,854 93,565 - 176,419
Furniture, fixtures and computer equipment…………… 914,316 - - 914,316
Total capital assets being depreciated……………… 38,490,290 229,330 - 38,719,620
Less accumulated depreciation……………………………… (19,209,552) (1,513,167) - (20,722,719)
Total capital assets being depreciated, net………………… 19,280,738 (1,283,837) - 17,996,901
Total capital assets……………………………………………… 31,769,436 17,395,687 - 49,165,123
NOTE 5 – INTERFUND RECEIVABLES, PAYABLES AND TRANSFERS
Interfund receivables and payables at June 30, 2010 are summarized as follows:
Nantucket Town
Memorial Internal Service
Airport Fund Total
General Fund………………………$ 705,492 $ - $ 705,492
Nantucket Memorial Airport……… - 11,010 11,010
Total……………………………$ 705,492 $ 11,010 $ 716,502
Due To:
Due From:
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 19 Financial Statements
Interfund receivables and payables at June 30, 2009 are summarized as follows:
Town Town
General Internal Service
Fund Fund Total
Nantucket Memorial Airport……………………$ 215,879 $ 11,010 $ 226,889
Due To:
Due From:
Interfund transfers for the fiscal year ended June 30, 2010 are summarized as follows:
Nantucket
General Memorial
Fund Airport Total
Nantucket Memorial Airport…………………$ 162,018 $ - $ 162,018 (1)
General Fund………………………………… - 997 997 (2)
Total………………………………………… $ 162,018 $ 997 $ 163,015
(1) Transfer out to Town General Fund for Indirect costs.
(2) Transfer out of General Fund for runway improvements.
Transfers In:
Transfers Out:
NOTE 6 – SHORT-TERM FINANCING
Short-term debt may be authorized and issued to fund the following:
• Current operating costs prior to the collection of revenues through issuance of revenue or tax anticipation
notes (RANS or TANS).
• Capital project costs and other approved expenditures incurred prior to obtaining permanent financing through
issuance of bond anticipation notes (BANS) or grant anticipation notes (GANS).
Short-term loans are general obligations and carry maturity dates that are limited by statute.
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 20 Financial Statements
Details related to the short-term debt activity for the fiscal year ended June 30, 2010, are as follows:
Balance at Balance at
Rate June 30, Renewed/ Retired/ June 30,
Type Purpose (%) Due Date 2009 Issued Redeemed 2010
BAN Airport Construction…………………………………… 1.50 02/25/11 $ - $ 24,916,500 $ - $ 24,916,500
BAN Airport Construction…………………………………… 1.75 02/26/10 8,712,725 - 8,712,725 -
BAN Airport Construction…………………………………… 1.50 02/26/10 16,850,000 - 16,850,000 -
Total short term debt………………………………………………………………$ 25,562,725 $ 24,916,500 $ 25,562,725 $ 24,916,500
Subsequent to year end the Airport retired the BANs maturing on February 25, 2011 with proceeds of General
Obligation Bonds totaling $5 million, new BANs totaling $2.6 million, and grant proceeds totaling $17.3 million.
Details related to the short-term debt activity for the fiscal year ended June 30, 2009, are as follows:
Balance at Balance at
Rate June 30, Renewed/ Retired/ June 30,
Type Purpose (%) Due Date 2008 Issued Redeemed 2009
BAN Airport Construction…………………………………… 2.25 02/27/09 $ 8,712,725 $ - $ 8,712,725 $ -
BAN Airport Construction…………………………………… 1.75 02/26/10 - 8,712,725 - 8,712,725
BAN Airport Construction…………………………………… 1.50 02/26/10 - 16,850,000 - 16,850,000
Total short term debt………………………………………………………………$ 8,712,725 $ 25,562,725 $ 8,712,725 $ 25,562,725
NOTE 7 – LONG-TERM DEBT
Under the provisions of Chapter 44, Section 10, Municipal Law authorizes The Town of Nantucket indebtedness
up to a limit of 5% of the Town’s equalized valuation. Debt issued in accordance with this section of the law is
designated as being "inside the debt limit". In addition, however, debt may be authorized in excess of that limit for
specific purposes. Such debt, when issued, is designated as being "outside the debt limit".
Details related to the Airport’s outstanding indebtedness at June 30, 2010, and the debt service requirements are
as follows:
Interest Outstanding Outstanding
Rate at June 30, at June 30,
Project (%) 2009 Issued Redeemed 2010
Airport Land Acquisition………………… 4.00 - 4.25 $ 190,000 $ - $ 95,000 $ 95,000
Airport Improvement……………………… 2.25 - 5.00 190,000 - 40,000 150,000
Airport Improvement……………………… 2.50 - 4.00 1,000,000 - 225,000 775,000
Airport Improvement……………………… 3.75 - 5.00 245,000 - 75,000 170,000
Airport Equipment………………………… 3.00 - 5.00 1,225,000 - 295,000 930,000
Total Bonds Payable…………………… $ 2,850,000 $ - $ 730,000 $ 2,120,000
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 21 Financial Statements
Debt service requirements for principal and interest for Airport bonds payable in future fiscal years as of June 30,
2010 are as follows:
Fiscal Year Principal Interest Total
2011………………$ 680,000 $ 69,278 $ 749,278
2012……………… 530,000 46,989 576,989
2013……………… 325,000 29,412 354,412
2014……………… 320,000 17,395 337,395
2015……………… 95,000 8,432 103,432
2016……………… 95,000 5,282 100,282
2017……………… 75,000 2,438 77,438
Total………………$ 2,120,000 $ 179,226 $ 2,299,226
Details related to the Airport’s outstanding indebtedness at June 30, 2009, and the debt service requirements are
as follows:
Interest Outstanding Outstanding
Rate at June 30, at June 30,
Project (%) 2008 Issued Redeemed 2009
Airport Land Acquisition………………… 4.00 - 4.25 $ 285,000 $ - $ 95,000 $ 190,000
Airport Improvement……………………… 2.25 - 5.00 290,000 - 70,000 220,000
Airport Improvement……………………… 2.50 - 4.00 1,165,000 - 195,000 970,000
Airport Improvement……………………… 3.75 - 5.00 320,000 - 75,000 245,000
Airport Equipment………………………… 3.00 - 5.00 1,522,312 - 297,312 1,225,000
Total Bonds Payable…………………… $ 3,582,312 $ - $ 732,312 $ 2,850,000
Debt service requirements for principal and interest for Airport bonds payable in future fiscal years as of June 30,
2009 are as follows:
Fiscal Year Principal Interest Total
2010………………$ 730,000 $ 99,281 $ 829,281
2011……………… 680,000 69,278 749,278
2012……………… 530,000 46,989 576,989
2013……………… 325,000 29,412 354,412
2014……………… 320,000 17,395 337,395
2015……………… 95,000 8,432 103,432
2016……………… 95,000 5,282 100,282
2017……………… 75,000 2,438 77,438
Total………………$ 2,850,000 $ 278,507 $ 3,128,507
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 22 Financial Statements
At June 30, 2010 and June 30, 2009, the Airport had the following authorized and unissued debt:
2010 2009
Purpose Amount Amount
Nantucket Memorial Airport………………………………$ 26,818,600 $ 22,718,600
Changes in Long-term Liabilities
During the fiscal year ended June 30, 2010, the following changes occurred in long-term liabilities:
Balance at Balance at
June 30, June 30, Current
2009 Additions Reductions 2010 Portion
Nantucket Memorial Airport:
Long-Term Bonds and Notes………… $ 2,850,000 $ - $ (730,000) $ 2,120,000 $ 680,000
Compensated Absences……………… 286,599 101,262 (57,320) 330,541 66,108
Other Postemployment Benefits……… 464,626 858,164 (176,440) 1,146,350 -
Total Long-Term Liabilities ……………$ 3,601,225 $ 959,426 $ (963,760) $ 3,596,891 $ 746,108
During the fiscal year ended June 30, 2009, the following changes occurred in long-term liabilities:
Balance at Balance at
June 30, June 30, Current
2008 Additions Reductions 2009 Portion
Nantucket Memorial Airport:
Long-Term Bonds and Notes………… $ 3,582,312 $ - $ (732,312) $ 2,850,000 $ 730,000
Compensated Absences……………… 199,533 126,973 (39,907) 286,599 57,320
Other Postemployment Benefits……… - 608,014 (143,388) 464,626 -
Total Long-Term Liabilities…………… $ 3,781,845 $ 734,987 $ (915,607) $ 3,601,225 $ 787,320
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 23 Financial Statements
NOTE 8 – RISK FINANCING
The Airport is exposed to various risks of loss related to torts; theft of, damage to and destruction of assets; errors
and omissions; and natural disasters for which the Town carries commercial insurance. The amount of claim
settlements has not exceeded insurance coverage in any of the previous three fiscal years.
The Town of Nantucket is self-insured for its health insurance activities, the Airport is included in the Town’s
insurance plan. The Airport pays the Town’s health insurance fund for its proportionate share of coverage.
NOTE 9 – PENSION PLAN
Plan Description - The Airport contributes to the Barnstable County Contributory Retirement System (the System),
a cost-sharing multiple-employer defined benefit pension plan administered by the Barnstable County Retirement
Board. Substantially all employees of the Airport are members of the System.
The System provides retirement, disability and death benefits to plan members and beneficiaries. Chapter 32 of
the MGL assigns authority to establish and amend benefit provisions of the plan. Cost-of-living adjustments
granted between 1981 and 1997 and any increase in other benefits imposed by the Commonwealth’s state law
during those years are borne by the Commonwealth and are deposited into the pension fund. Cost-of-living
adjustments granted after 1997 must be approved by the Barnstable County Retirement Board and are borne by
the System. The System issues a publicly available, unaudited, financial report in accordance with guidelines
established by the Commonwealth of Massachusetts’ Public Employee Retirement Administration Commission
(PERAC). That report may be obtained by contacting the System located at 99 Willow Street, Yarmouthport,
Massachusetts, 02675.
Funding Policy - Plan members are required to contribute to the System at rates ranging from 5% to 11% of
annual covered compensation. The Airport is required to pay into the System their share of the system-wide
actuarial determined contribution that is apportioned among the employers based on active current payroll.
Administrative expenses are funded through investment earnings. Chapter 32 of the MGL governs the
contributions of plan members and the Airport. The Airport’s contributions to the System for the fiscal year ended
June 30, 2010, 2009 and 2008 totaled $415,234, $419,860, and $343,055 respectively, which equaled its
required contributions for each fiscal year.
The schedule of funding progress, presented as required supplementary information, following the notes to the
financial statements, presents multiyear trend information about whether the actuarial value of plan assets is
increasing or decreasing over time relative to the actuarial accrued liability for benefits. Additionally, the schedule
of employer contributions, presented as required supplementary information, following the notes to the financial
statements, presents multiyear trend information for required and actual contributions relating to the cost-sharing
plan as a whole, of which the Airport is one participating employer, as well as the Airport’s proportionate share of
the plan’s annual contributions. This information is designed to be helpful for understanding the scale of the
information presented relative to the Airport.
NOTE 10 – POSTEMPLOYMENT BENEFITS OTHER THAN PENSIONS
Fiscal year 2009 was the initial year that the Airport implemented GASB Statement 45, Accounting and Financial
Reporting by Employers for Postemployment Benefits Other Than Pensions (GASB 45). As allowed by GASB 45,
the Airport established the net Other Postemployment Benefits (OPEB) obligation at zero at the beginning of the
transition year and has applied the measurement and recognition requirements of GASB 45 on a prospective
basis plan, which covers both active and retired members. Chapter 32B of the MGL assigns authority to establish
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 24 Financial Statements
and amend benefit provisions of the plan. Benefit provisions are negotiated between the Airport and the unions
representing Airport employees and are renegotiated each bargaining period. The Retiree Health Plan does not
issue a publicly available financial report.
Funding Policy – Contribution requirements are also negotiated between the Airport and union representatives.
The required contribution is based on a pay-as-you-go financing requirement. The Airport contributes 80% of the
cost of current-year premiums for eligible retired plan members and their spouses. Plan members receiving
benefits contribute the remaining 20% of their premium costs. For fiscal year 2010, the Airport contributed
approximately $176,000 to the plan.
Annual OPEB Cost and Net OPEB Obligation – The Airport’s annual other postemployment benefit (OPEB) cost
(expense) is calculated based on the annual required contribution of the employer (ARC), an amount actuarially
determined in accordance with the parameters of GASB Statement 45. The ARC represents a level of funding
that, if paid on an ongoing basis, is projected to cover the normal cost each year and amortize any unfunded
actuarial liabilities (or funding excess) over a period not to exceed thirty years. The components of the
Airport’s annual OPEB cost for the year, the amount actually contributed to the plan, and changes in the Airport’s
net OPEB obligation are summarized in the following table:
Annual Required Contribution………………………………… $ 821,534
Interest on net OPEB obligation……………………………… 36,623
Annual OPEB cost (expense)……………………………… 858,157
Contributions made……………………………………………… (176,433)
Increase in net OPEB obligation……………………………… 681,724
Net OPEB obligation - beginning of year……………………… 464,626
Net OPEB obligation - end of year…………………………… $ 1,146,350
The Airport’s annual OPEB cost, the percentage of annual OPEB cost contributed to the plan, and the net OPEB
obligation for fiscal years 2010 and 2009 were as follows:
Percentage of
Fiscal Year Annual Annual OPEB Net OPEB
Ended OPEB Cost Cost Contributed Obligation
6/30/2009 $ 608,014 24% $ 464,626
6/30/2010 858,157 21% 1,146,350
Funded Status and Funding Progress – As of July 1, 2009, the most recent actuarial valuation date, the actuarial
accrued liability for benefits totaled approximately $8.7 million, all of which was unfunded.
Actuarial valuations of an ongoing plan involve estimates of the value of reported amounts and assumptions
about the probability of occurrence of events far into the future. Examples include assumptions about future
employment, mortality, and the healthcare cost trend. Amounts determined regarding the funded status of the
plan and the annual required contributions of the employer are subject to continual revision as actual results are
compared with past expectations and new estimates are made about the future. The schedule of funding
progress, presented as required supplementary information following the notes to the financial statements,
presents multiyear trend information about whether the actuarial value of plan assets is increasing or decreasing
over time relative to the actuarial accrued liabilities for benefits.
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 25 Financial Statements
Actuarial Methods and Assumptions – Projections of benefits for financial reporting purposes are based on the
substantive plan (the plan as understood by the employer and the plan members) and include the types of
benefits provided at the time of each valuation and the historical pattern of sharing of benefit costs between the
employer and plan members to that point. The actuarial methods and assumptions used include techniques that
are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of
assets, consistent with the long-term perspective of the calculations.
In the July 1, 2009, actuarial valuation, actuarial liabilities were determined using the projected unit credit cost
method. The actuarial assumptions included a 4.00% investment return assumption, which is based on the
expected yield on the assets of the Airport, calculated based on the funded level of the plan at the valuation date,
and an annual medical/drug cost trend rate of 5-9%. The UAAL is being amortized over a 30 year period, with
amortization payments increasing at 4.50% per year. The remaining amortization period at June 30, 2010 is 28
years.
NOTE 11 – COMMITMENTS
The Airport has contracts with JK Scanlan and Jacobs, Edwards and Kelcey for construction of the new aircraft
rescue and fire fighting (A.R.F.F.) building. At year end, the open contracts totaled approximately $5,495,000 and
$124,300.
The Airport also has a contract with Skanska USA Building, Inc. for construction of the new airport terminal. At
year end, the open contract totaled approximately $22,872,934.
The Airport also has a contract with Edwards & Kelcey, Inc. for design and construction of the runway 33
extension project. At year end, the open contract totaled approximately $865,090.
NOTE 12 – CONTINGENCIES
The Airport participates in a number of federal award programs. Although the grant programs have been audited
in accordance with the provisions of the Single Audit Act Amendments of 1996 through June 30, 2010 and 2009,
these programs are still subject to financial and compliance audits. The amount, if any, of expenditures which
may be disallowed by the granting agencies cannot be determined at this time, although it is expected such
amounts, if any, to be immaterial.
Various legal actions and claims are pending. Litigation is subject to many uncertainties, and the outcome of
individual litigated matters is not always predictable. Although the amount of liability, if any, at June 30, 2010,
cannot be ascertained, management believes any resulting liability should not materially affect the Airport’s
financial position at June 30, 2010 and 2009.
NOTE 13 – IMPLEMENTATION OF NEW GASB PRONOUNCEMENTS
During fiscal year 2010, the Airport has implemented the following GASB pronouncements:
• The GASB issued Statement #57, OPEB Measurements by Agent Employers and Agent Multiple-
Employer Plans. The standards in this statement permits an agent employer that has an individual
employer OPEB plan with fewer than 100 members to use an alternative measurement method to
produce actuarially based information for purposes of financial reporting, regardless of the number of total
plan members in the agent multiple-employer OPEB plan in which it participates. Management elected to
implement this standard early and this standard did not impact the basic financial statements.
Notes to Financial Statements Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 26 Financial Statements
• The GASB issued Statement #58, Accounting and Financial Reporting for Chapter 9 Bankruptcies. The
standards in this statement provide guidance for bankrupt state and local governments by establishing
requirements for recognizing and measuring the effects of the bankruptcy process on assets and liabilities
and for classifying changes in those items and related costs. Management elected to implement this
standard early and this standard did not impact the basic financial statements.
Future Implementation of GASB Pronouncements
• The GASB issued Statement #54, Fund Balance Reporting and Governmental Fund Type Definitions,
which is required to be implemented in fiscal year 2011. The implementation of this GASB will impact
Nantucket Memorial Airport’s financial statements, as it changes fund balance components into
Nonspendable; Restricted; Committed; Assigned; and Unassigned.
• The GASB issued Statement #59, Financial Instruments Omnibus, which is required to be implemented in
fiscal year 2011. Management is assessing the impact this pronouncement will have on the basic
financial statements.
• The GASB issued Statement #60, Accounting and Financial Reporting for Service Concession
Arrangements, which is required to be implemented in fiscal year 2013. Management is assessing the
impact this pronouncement will have on the basic financial statements.
• The GASB issued Statement #61, The Financial Reporting Entity: Omnibus, which is required to be
implemented in fiscal year 2013. Management is assessing the impact this pronouncement will have on
the basic financial statements.
• The GASB issued Statement #62, Codification of Accounting and Financial Reporting Guidance
Contained in Pre-November 30, 1989 FASB and AICPA Pronouncements, which is required to be
implemented in fiscal year 2013. Management is assessing the impact this pronouncement will have on
the basic financial statements.
Nantucket Memorial Airport 27 Required Supplementary Information
Required Supplementary Information
Nantucket Memorial Airport 28 Required Supplementary Information
Retirement System
Schedules of Funding Progress and
Employer Contributions
The Retirement System Schedule of Funding Progress presents multiyear trend information about whether the
actuarial value of planned assets is increasing or decreasing over time relative to the actuarial accrued liability for
benefits.
The Retirement System Schedule of Employer Contributions presents multiyear trend information for required and
actual contributions relating to the cost-sharing plan as a whole, of which the Airport is one participating employer,
as well as the Airport’s proportionate share of the plan’s annual contributions.
Retirement System Schedules
Actuarial UAAL as a
Actuarial Accrued Unfunded Percentage
Actuarial Value of Liability (AAL) AAL Funded Covered of Covered
Valuation Assets Entry Age (UAAL) Ratio Payroll Payroll
Date (A) (B) (B-A) (A/B) (C) ((B-A)/C)
1/1/1993 $ 97,194,645 $ 226,430,792 $ 129,236,147 42.9% $ 97,074,725 133.1%
1/1/1996 157,044,089 276,107,221 119,063,132 56.9% 108,456,079 109.8%
1/1/1998 235,247,660 404,215,695 168,968,035 58.2% 121,161,677 139.5%
1/1/2000 300,396,700 462,462,500 162,065,800 65.0% 152,293,100 106.4%
1/1/2002 362,911,896 553,531,966 190,620,070 65.6% 173,610,557 109.8%
1/1/2004 378,317,300 647,655,411 269,338,111 58.4% 190,614,004 141.3%
1/2/2006 465,637,984 765,747,723 300,109,739 60.8% 215,474,180 139.3%
1/1/2007 517,396,087 825,863,068 308,466,981 62.6% 226,391,633 136.3%
1/1/2009 520,089,855 966,564,614 446,474,759 53.8% 249,971,296 178.6%
The Airport's share of the UAAL, as of January 1, 2009, is approximately 1.09%.
See notes to required supplementary information.
BARNSTABLE COUNTY CONTRIBUTORY RETIREMENT SYSTEM
SCHEDULE OF FUNDING PROGRESS
Nantucket Memorial Airport 29 Required Supplementary Information
(B/A)
Plan Year Annual (A) (B) Airport's Percentage
Ended Required Actual Percentage Actual of System Wide
December 31 Contributions Contributions Contributed Contributions Actual Contributions
2005 $ 27,846,430 $ 27,846,430 100% $ 264,000 0.95%
2006 31,044,132 31,044,132 100% 311,318 1.00%
2007 34,360,812 34,360,812 100% 350,906 1.02%
2008 39,899,322 39,899,322 100% 343,055 0.86%
2009 43,893,051 43,893,051 100% 419,860 0.96%
The Airport's Actual Contributions equaled 100% of its Required Contributions for each year presented.
See notes to required supplementary information.
BARNSTABLE COUNTY CONTRIBUTORY RETIREMENT SYSTEM
SCHEDULE OF FUNDING PROGRESS
System Wide Nantucket Memorial Airport
Nantucket Memorial Airport 30 Required Supplementary Information
Nantucket Memorial Airport 31 Required Supplementary Information
Other Postemployment Benefit Plan
Schedules
The Schedule of Funding progress compares, over time, the actuarial accrued liability for benefits with the
actuarial value of accumulated plan assets.
The Other Postemployment Benefit Plan Schedule of Employer Contributions presents multiyear trend information
for required and actual contributions relating to the plan.
The Schedule of Actuarial Methods and Assumptions presents factors that significantly affect the identification of
trends in the amounts reported.
Other Postemployment Schedules
SCHEDULE OF FUNDING PROGRESS AND EMPLOYER COONTRIBUTIONS
Actuarial UAAL as a
Actuarial Accrued Unfunded Percentage
Actuarial Value of Liability (AAL) AAL Funded Covered of Covered
Valuation Assets Projected Unit Credit (UAAL) Ratio Payroll Payroll
Date (A) (B) (B-A) (A/B) (C) ((B-A)/C)
7/1/2007 $ - $ 2,935,000 $ 2,935,000 0% $ N/A N/A
7/1/2009 - 8,725,000 8,725,000 0% N/A N/A
Annual Actual
Year Required Contributions Percentage
Ended Contribution Made Contributed
6/30/2009 $ 608,014 $ 143,388 24%
6/30/2010 858,157 176,433 21%
See notes to required supplementary information.
Schedule of Employer Contributions
OTHER POSTEMPLOYMENT BENEFIT PLAN
Schedule of Funding Progress
Nantucket Memorial Airport 32 Required Supplementary Information
ACTUARIAL METHODS AND ASSUMPTIONS
Actuarial Methods:
Valuation date……………………………………………… July 1, 2009
Actuarial cost method……………………………………… Projected Unit Credit Cost Method
Amortization method……………………………………… Amortization payments increasing at 4.50%
Remaining amortization period…………………………… 28 years as of July 1, 2009, closed
Actuarial Assumptions:
Investment rate of return…………………………………… 4.00%, pay-as-you-go scenario
Medical/drug cost trend rate……………………………… 5-9%
Plan Membership, Town Wide:
Current retirees, beneficiaries, and dependents………… 228
Current active members…………………………………… 682
Total…………………………………………………………910
See notes to required supplementary information.
OTHER POSTEMPLOYMENT BENEFIT PLAN
Nantucke Memorial Airport 33 Required Supplementary Information
Notes to Required Supplementary Information Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 34 Required Supplementary Information
NOTE A – PENSION PLAN
Notes to Required Supplementary Information
The Airport contributes to the Barnstable County Contributory Retirement System (“Retirement System”), a cost-
sharing, multiple-employer defined benefit pension plan (“Plan”) administered by the Barnstable County
Retirement Board. The Retirement System provides retirement, disability, and death benefits to members and
beneficiaries. Chapter 32 of the MGL assigns authority to establish and amend benefit provisions of the Plan.
Plan members are required to contribute to the Retirement System at rates ranging from 5% to 11% of annual
covered compensation. The Airport is required to pay into the Retirement System its share of the systemwide
actuarially determined contribution which is apportioned among the employers based on active covered payroll.
The schedule of funding progress, presented as required supplementary information, following the notes to the
financial statements, presents multiyear trend information about whether the actuarial value of plan assets is
increasing or decreasing over time relative to the actuarial accrued liability for benefits. Additionally, the schedule
of employer contributions, presented as required supplementary information, following the notes to the financial
statements, presents multiyear trend information for required and actual contributions relating to the cost-sharing
plan as a whole, of which the Town of Nantucket is one participating employer, as well as the Airport’s
proportionate share of the plans annual contributions. This information is designed to be helpful for
understanding the scale of the information presented relative to the Airport.
The following actuarial methods and assumptions were used in the Retirement System’s most recent actuarial
valuation:
Actuarial Methods and Assumptions:
Valuation Date…………………………………………………January 1, 2009
Actuarial Cost Method…………………………………………Entry Age Normal Cost Method
Amortization Method…………………………………………Increasing at 4.50% per year after fiscal 2013
Early Retirement Incentives and remaining
unfunded liability
Asset Valuation Method………………………………………5-year smoothing of investment returns greater (less)
than expected.
Actuarial Assumptions:
Investment rate of return……………………………………8.25%
Projected salary increases…………………………………5.00%
Cost of living adjustments………………………………… 3.0% for the first $12,000 of retirement income
Plan Membership:
Retired participants and beneficiaries receiving benefits…………………………………… 2,368
Terminated participants entitled to a return of their employee contributions……………… 635
Terminated participants with a vested right to a deferred or immediate benefit………… 113
Active participants……………………………………………………………………………… 5,290
Total……………………………………………………………………………………………… 8,406
Remaining Amortization Period………………………………19 years from July 1, 2009 for 2002 and 2003
Notes to Required Supplementary Information Fiscal Years Ended June 30, 2010 and 2009
Nantucket Memorial Airport 35 Required Supplementary Information
NOTE B – OTHER POSTEMPLOYMENT BENEFITS
The Nantucket Memorial Airport participates in the Town’s healthcare plan. The Town administers a single-
employer defined benefit healthcare plan (“the Retiree Health plan”). The plan provides lifetime healthcare for
eligible retirees and their spouses through the Town’s health insurance plan, which covers both active and retired
members, including teachers.
The Town currently finances its other postemployment benefits (OPEB) on a pay-as-you-go basis. As a result,
the funded ratio (actual value of assets expressed as a percentage of the actuarial accrued liability) is 0%. In
accordance with Governmental Accounting Standards, the Town has recorded its OPEB cost equal to the
actuarial determined annual required contribution (ARC) which includes the normal cost of providing benefits for
the year and a component for the amortization of the total unfunded actuarial accrued liability of the plan.
The Schedule of Funding Progress presents multiyear trend information which compares, over time, the actuarial
accrued liability for benefits with the actuarial value of accumulated plan assets
Projections of benefits for financial reporting purposes are based on the substantive plan and included the types
of benefits provided at the time of each valuation and the historical pattern of sharing of benefit cost between the
employer and plan members to that point. The actuarial methods and assumptions used include techniques that
are designed to reduce the effects of short-term volatility in actuarial accrued liabilities and the actuarial value of
assets, consistent with the long-term perspective of the calculations.
The Schedule of Actuarial Methods and Assumptions presents factors that significantly affect the identification of
trends in the amounts reported.