Page 11 - BAA CAFR 2017

revenues are used to operate or maintain the Airport. Mr. Al Denson, President and Chief Executive
Officer, has overall responsibility for the management, administration, and planning of organizational
activities for the Authority. Mr. Denson has an experienced staff to aid him in carrying out the
responsibilities of the position.

The City Lease requires that the annual operating budget and the five‐year capital improvement budget
of the Authority be submitted to the Mayor of the City and the City Council for approval. The Authority
maintains financial records in accordance with generally accepted accounting principles and practices and
is subject to an independent audit at any time at the discretion of the City. On June 1, 1990, the City Lease
was amended such that the Authority’s financial obligation under the City Lease was subordinated to any
pledge of the Authority of its revenues to secure any indebtedness.

Economic Conditions

The City of Birmingham area continues to show the effects of the slow recovering economy. The
Birmingham‐Hoover Metropolitan Statistical Area unemployment rate for June 2017 was 4.7%, which was
above the State of Alabama and the national rates of 4.6% and 4.4%, respectively.

The primary service region for the Airport, the seven‐county Birmingham‐Hoover ‐ Metropolitan Statistical
Area ("MSA"), has a diverse economic base and is the principal center of finance, trade, health care,
manufacturing, transportation, and education in the State of Alabama. The MSA includes the following
seven counties, ordered based on population size (largest to smallest): Jefferson, Shelby, St. Clair, Walker,
Blount, Chilton, and Bibb. Jefferson County, which has an estimated population of approximately 661,000
in 2017, is the center of the seven‐county Birmingham‐Hoover Metropolitan Statistical Area (MSA), which
covers 6,145 square miles. Birmingham, the State’s largest city and the county seat, has an estimated
population of approximately 210,000 in 2017.

With over 2.6 million passengers annually, the Airport is Alabama’s busiest commercial service airport.
Currently, the Airport is served by four major airlines providing travelers with 112 daily flights and service
to 18 airports in 15 cities. In addition to these passenger carriers, the Airport is served by three all‐cargo
operators: Federal Express (FedEx), Mountain Air, and United Parcel Service (UPS). Combined with the
“belly” cargo transported by the passenger airlines, more than 85,000 tons of landing weight is
attributable to cargo at the Airport each year. The Airport also receives significant activity by General
Aviation (GA) aircraft. Of the 94,000 operations reported for FY 2017, 40% were categorized as general
aviation activity. GA is a broad classification covering all aviation activity other than scheduled commercial
service and military aviation. General aviation activity therefore covers a range that includes a personal,
business, training, and emergency service activity.

Major Initiatives and Development

The Authority’s five‐year Capital Improvement Plan (CIP) for fiscal years 2018 – 2022 has appropriation
requirements of approximately $159 million dollars, with 8.4% of appropriations planned for fiscal year