(1) A General Twinkling
Miami-Dade County is a chartered political subdivision of the State of Florida and is granted home rule county powers by the Constitution of the State of Florida and Florida Statutes. The Board of County Commissioners (BBC) is the legislative and governing body of the County.

Miami-Dade Aviation Department (MDAD) is an enterprise fund and included in the Miami-Dade County’s comprehensive annual financial report as part of the County reporting entity.

Pursuant to the general laws of the State of Florida, the County owns Miami International Airport (MIA), four general aviation airports, and one training and transition airport, all of which are operated by the Aviation Department.

(2) Operations Keystone
The Aviation Department does not receive any money from the General Funds of Miami-Dade County. The Department generates its own revenue to pay for all expenses associated with the operation of all airports. The Aviation Department operates as an enterprise fund of the County. An enterprise fund is used to account for the financing of services to the general and the travelling public. All of the costs incurred to run its operation are substantially paid in the form of charges by users of such services.

In addition, the Aviation Department pays for some services provided directly by other County Departments. On the other hand, the Department also reimburses the General Fund of the County for its portion of the direct administrative service cost of several County departments. The list of departments includes Audit and Management Services, Board of County Commissioners, Clerk of the Courts, Computer Services and Information Systems, County Manager, Fire, Police, Personnel and others. The cost reimbursement is based on a formula that was developed as a result of an internal study to determine the appropriate method as a basis to establish the indirect administrative services cost reimbursement.

(3) Categorization of Properties at The Airport
In order to be able to secure the financing of its capital improvement throughout the airports system, the County, through the Aviation Department, has utilized various methods and revenue sources to secure the financing of construction and improvements of the airports. As a result of these financing arrangements, properties were classified into two distinguished properties, (1) Port Authority Properties and (2) Non-Port Authority Properties.

Port Authority Properties
Port Authority Properties consist of all land and the facilities at the Airports, which were acquired or constructed with government grants, passenger facility charges, and proceeds of Revenue Bonds issued by the County under the terms of the 1954 Trust Agreement, as amended by supplemental agreements.

Non-Port Authority Properties
Non-Port Authority Properties consist of certain buildings, structures and other facilities at the Airports, which were constructed or acquired by tenant financing, government grants and proceeds from Special Revenue and Aviation Facilities Variable Rate Demand Bonds not issued by the County under the Trust Agreement.

The Board of County Commissioners has adopted a series of resolutions creating a separate internal fund, known as the Miami-Dade County Aviation Development Fund (ADF) to separately account for all assets, operations, and the related debt service and repairs and maintenance of certain Non-Port Authority Properties, including all facilities financed through the issuance of Aviation Facilities Bonds which are governed by the series of resolutions defined under The Master Resolution.

However, As of June 1, 2003, Port Authority Properties acquired Aviation Development Facilities and, upon the acquisition of ADF by PAP, the Airport is now operating as a single financial enterprise, and all revenue derived from the use and occupancy of the Airport System are revenue of the Port Authority Properties.

(4) Airport Authority For Rates, Fees & Other Charges
Under the provisions of the amended and restated Trust Agreement, the Aviation Department is required to maintain, charge and collect rates and charges for the use and services provided by Port Authority Properties and to assure that sufficient revenues are generated to meet the rate covenant requirements of the amended and restated Trust Agreement and the earnings requirements for the issuance of additional bonds to fund airports’ improvements.

(5) Airport Sources of Revenue
The various sources of revenue generated by the Aviation Department consist of three major categories described in the following schedule:

Category Description Aviation fees Landing fee, Loading bridge fee, aircraft parking fee, screening fee, baggage devices fee and Concourse use fee.   Rental Leasing operations that include but not limited to: land, buildings and office space, warehouse space, ticket counter space, terminal and cargo facilities spaces. Commercial Operations Food and beverage facilities, duty-free merchandise shops, public parking, newsstand facilities, gift shop facilities, pharmacy, sundries and lunch counters, special service lounges, fuel farm, baggage checkroom services, child care facilities, Airport Hotel, Top of the Port Restaurant, porter services, various rent-a-car companies, aeronautical service companies, and certain terminal complex concessionaires providing and selling a variety of services and commodities.

(6) Airport Credit Rating
Miami International Airport (MIA) issues Aviation Revenue Bonds to finance the majority of its Capital Improvement Program (CIP). MIA’s CIP is one of the largest in the world today. Due to the uncertainty of the future, the issuer of the bonds usually goes under extensive scrutiny and evaluation. The evaluations are customarily performed by independent credit rating agencies. These agencies meet with MIA to review and analyze the financial position thoroughly, as well as evaluate any possible economic impact on Miami-Dade Aviation Department.

There are three primary credit rating agencies in the financial market that rate MIA’s bonds: Moody’s, Standard & Poor’s and Fitch. They reviewed, examined and analyzed the financial condition of the Aviation Department to determine its financial strengths and weaknesses to be able to assign a rating to MIA’s Revenue Bonds. Bond ratings are critical because of the potential impact on investors, pricing and interest rate associated with the issuance of the bonds.

Based on their evaluation, the three agencies, Moody’s, Standard & Poor’s and Fitch, assigned the rating of A1, A- and A, respectively, to the Aviation Revenue Bonds. These ratings are considered favorable and very strong and reflect MIA’s positive presence in the capital market, which makes MIA’s bonds very attractive to investors.

(7) Airport & Aviation Department National Recognition & Awards:
The Government Finance Officers Association of the United States and Canada (GFOA) awarded a Certificate of Achievement for Excellence in Financial Reporting to the Aviation Department for its Component Unit Financial Report for the last eleven consecutive years.

The Certificate of Achievement is a “prestigious” national award-recognizing conformance with the “highest” standards for preparation of state and local government financial reports.

In order to be awarded a Certificate of Achievement, the Department had to publish an easily readable and efficiently organized component unit financial report, whose contents conform to program standards. Such component unit financial report must satisfy both generally accepted accounting practices (GAAP) and applicable legal requirements.