Metropolitan Airports Commission

Budget & Financial Information

Budget Facts

The Metropolitan Airports Commission is a public corporation of the state. Unlike typical state agencies, the MAC does not receive an appropriation from the state operating budget. Instead, the MAC operates like a business, paying its expenses from revenues it generates.

In 2007, the MAC is projecting operating revenues of $252.8 million against operating expenses of $124.7 million, excluding depreciation.

2007 MAC Revenue Sources	Percentage*
Airline Rates and Charges	32
Airport Concessions	48
Other	20

2005 MAC Expenses	Percentage
Depreciation	48
Personnel	23
Maintenance	9
Utilities	7
Operating Services	6
Professional Services	2
Administrative Costs	1
Other Costs	4

* unaudited

MAC construction projects are funded in a variety of ways: sale of bonds, federal grants and aid, passenger facility charges (fees added to airline tickets and collected by airlines), interest earnings and net operating income.

There are various financial models used to cover costs of operating airports:

The Compensatory Model:
Airlines pay only for the space they occupy. The airport authority is responsible for the overall operation and profitability of the airport and bears all associated risks.
The Residual Model:
Airlines assume all the costs associated with operation of the airport. In turn, airlines received credit for all the revenue generated at the airport. Airlines then pay for any remaining costs, including an amount for debt service coverage.
Hybrid Models:
Hybrid airports combine elements of the Compensatory and Residual models.

Minneapolis-St. Paul International is a hybrid airport. Although certain rates and charges are calculated on a residual (cost-recovery) basis, such as aircraft landing and ramp fees, the MAC is responsible for the overall profitability of the airport system and for any losses incurred in other cost centers. The MAC carries most of the risk of operating its airports and uses airport revenues to cover operating expenses and debt service.

The MAC has authority to levy taxes in the seven county metropolitan area for a variety of purposes: to pay debt on general obligation revenue bonds, to fund part of its operations and maintenance, and to provide police and fire services, parking facility maintenance and roadway upkeep. However, the MAC has not levied taxes for debt service since 1969, for operations and maintenance since 1961, or for police, fire, streets and parking since the early 1980s.