Metro-East News

Is county spending too much on MidAmerica? Depends on who you ask

MidAmerica Airport
MidAmerica Airport

St. Clair County transferred $6.5 million into MidAmerica Airport coffers from the county’s general fund in 2015, a subsidy which is down from $7.6 million in 2014.

Of the $6.5 million subsidy, $5.4 million was for payment toward previous debt. The transfers included $306,000 in cash and other costs paid on behalf of the airport.

St. Clair County Board Chairman Mark Kern said flights, passengers flying out of the airport and fuel sales have increased. He has said the airport is getting closer to breaking even, and that businesses at the airport are doing well.

Kern points out that after removing the cost of the debt service, the airport needed only $1.5 million in operating subsidy, and the airport is moving up the ranks in the country.

“We continue to move in the right direction,” Kern said. “The more flights we have, the more landing fees, and concessions and other things ... continue to move the airport operating (to) a break-even level.”

He added the airport presence and the county owning nearby land helps protect Scott Air Force Base, which has a large economic impact in the county, from potential military base closures.

We continue to move in the right direction. The more flights we have, the more landing fees, and concessions and other things ... continue to move the airport operating (to) a break even level.

Mark Kern, St. Clair County Board chairman

Even though the subsidy was lower, the amount is still too high for St. Clair County Board member Ed Cockrell, a Republican who has pushed recently for shifting airport oversight from the county’s Public Building Commission to the County Board.

“The taxpayers of St. Clair County and services are suffering because of the subsidization of MidAmerica Airport,” Cockrell said. “Everything from the election department to public safety.”

The county also paid $370,000 in benefit costs and $466,000 in insurance for the airport, audit documents say.

The airport, which listed $17 million in expenses, saw its net position also drop by $6.6 million. However, $6.2 million of that drop is in depreciation, audit documents say.

The taxpayers of St. Clair County and services are suffering because of the subsidization of MidAmerica Airport. Everything from the election department to public safety.

Ed Cockrell, St. Clair County board member

Airport revenues also were down by $475,000. Because fuel costs were down last year, fuel sales decreased slightly, even though there was an increase of more than 300,000 gallons sold.

“That is kind of misleading, because a lot of our revenue comes from the sale of fuel, and last year, fuel prices dropped dramatically. A large portion of that decrease in revenues had to deal with that decrease in fuel prices,” said Susan Schmidt, county’s financial analyst. “This year we’re over a million gallons at the end of July. Last year we barely hit a million gallons. We’re doing quite well on the sale of fuel.”

The airport also increased its passenger facility charges by $47,000 because of the increase of 20,000 passengers going through the terminal, county documents say.

As for the governmental side of the ledger, St. Clair County had $109.5 million in governmental activity expenses in 2015. It brought in $94.6 million in revenues.

The county continued to make capital investments, some of which were from money from previously sold bonds.

St. Clair County’s highway department also completed $10 million worth of capital asset additions, including $5.6 million in road work, audit documents say.

Schmidt added the county spent $1.5 million on 911 equipment upgrades in 2015.

Revenues were down $3.6 million for the county in 2015, according to the audit, as there was less money coming in from operating grants, and in capital grants.

Schmidt said previous grants from Homeland Security have dropped off, and there is less money coming from other federal resources and the state.

However there was an increase in property taxes as taxable assessment increased slightly in 2015.

The county health department, which operates mostly on grants, has been holding off hiring new people, and is using part-time employees, because of an unknown on whether it will get grants renewed, Schmidt said.

“They’ve got those people stretched thin,” Schmidt said.

Expenses for the county also increased by $7.5 million. The county said $6.8 million is attributed to new reporting requirements from the Governmental Accounting Standards Board for calculating and reporting pension liability estimates.

“Every government is going to have to do this anyway,” Kern said.

In total, the county had to report a $36 million unfunded liability for pensions, but it is offset by $19 million worth of investments in the Illinois Municipal Retirement Fund.

“This is a brand new item, it really glares at you when you see a $36 million liability on your balance sheet,” Schmidt said.

Interest rates have killed us. We were able to subsidize a lot of activities because we (had) those kind of revenues coming in.

Susan Schmidt, St. Clair County financial analyst

Increased unfunded mandates have led to higher costs for the county, Schmidt said. She cited increases in jury pay, and court interpreter costs.

“Those costs keep increasing,” Schmidt said.

Payroll decreased by $663,000 as the county cut its workforce, but there were $4.4 million in insurance, employee medical and tort increases.

“We had some pretty high cases, medical cases, and some pretty high claims for our tort,” Schmidt said.

Earnings from investments have dropped in the last eight years, since the recession.

In 2007, the county earned $9.6 million from investments. In 2015 it earned $843,000.

“Interest rates have killed us,” Schmidt said. “We were able to subsidize a lot of activities because we (had) those kind of revenues coming in.”

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