Airport, seaport debt service ratios exceed trustee requirement

The Commonwealth Ports Authority recorded positive financial performance for the first four months of the fiscal year, resulting in the agency’s exceeding its required debt service ratios for both airport and seaport divisions.
In a report to the board of directors, CPA comptroller Skye Lynn Aldan disclosed that for the period ending Jan. 31 this year, the airport division recorded a debt service ratio at 452 percent, while the seaport division posted its ratio at 174 percent. Both figures exceeded the 1.25 percentage debt coverage ratio requirement of the bond trustee.

Based on the bond indenture agreements, CPA is mandated to generate every fiscal year revenues that is equal to the agency’s operating expenditures setting a minimum 125 percent of required bond payments. Since 1998, the ports authority had issued revenue bonds including $20.05 million in airport revenues; $33.7 million for seaport bonds; and another $7.225 million seaport bonds issued in 2005.

According to Aldan’s report—from October 2013 through Jan. 31, 2014—airport registered a debt service ratio of 452 percent, or a surplus of 327 percent from the required ratio of 1.25 percent which represents $1.512 million from the total revenue requirement of $577,669.

“For four months, debt coverage ratio is 552 percent or a surplus of 427 percent which represents $493,377 from the total revenue requirement of $144,417,” indicated the comptroller’s report that was presented last Friday by board fiscal committee chairperson Frances Mafnas.

Still for airport division, cash and equivalents available for operation totaled $15.319 million, and after deduction on reserved the unreserved cash and equivalents available for CPA is approximately $1.465 million.

As of Jan. 31 this year, Aldan disclosed that the airport division registered a net income of $2.084 million, which was gained from operating revenues and expenses.

Records show that the airport division generated $4.745 million as operating revenue as of Jan. 31, while expenses incurred year-to-date is $2.660 million. For the airport division, total investment account balances as of Jan. 31 is at $3.945 million.

Seaport financial performance

For the seaport division, debt coverage ratio is at 174 percent or a surplus of 49 percent from the required ratio of 1.25, which represents $507,941 from the total revenue requirement for the period ending Jan. 31, 2014. The debt coverage ratio is 206 percent, or a surplus of 81 percent, which represents $210,516 from the total revenue requirement of $324,537.

For cash and equivalents available for operations at seaport, CPA posted $18.134 million and after deduction on reserved the unreserved cash and equivalents available is approximately $1.190 million.

As of Jan. 31, the seaport division registered a net income of $1.727 million which was gained from operating revenues and expenditures. The division recorded total expenses in four months of $503,056, while revenue generated year to date is $2.230 million. For the division, total investment account balances as of Jan. 31 is $14.602 million.

During Friday’s board meeting, seaports facilities committee chair Benigno Sablan lauded the agency’s accounting department for what he described is “an excellent report.” Sablan noted that CPA had exceeded bond ratio requirements for both airport and seaport divisions.

For financial committee chair Frances Mafnas, CPA—based on the latest financial statements—is showing good financial standing. She cited the increased gross revenues coupled with controlled agency expenditures as key factors of the agency’s continued positive financial performance.