Seattle, Washington
2013 Budget and Business Plan
Seattle, Washington
2013 Budget and Business Plan
And
Draft Plan of Finance *
Prepared by:
Finance and Budget Departments
*The information contained in the 2013 Budget and Business Plan is correct as
of the date of adoption on November 27, 2012. The 2013 budget and the
five-year operating and capital budget forecasts were developed based on
assumptions that have subsequently changed and the Port is currently in the
process of revising its forecasts.
Distinguished Budget Presentation Award
The Government Finance Officers Association of the United States and Canada (GFOA)
presented a Distinguished Budget Presentation Award to the Port of Seattle for its annual
budget for the fiscal year beginning January 1, 2012.
In order to receive this award, a governmental unit must publish a budget document that
meets program criteria as a policy document, as an operations guide, as a financial plan
and as a communications device.
This award is valid for a period of one year only. We believe our current budget continues
to conform to programs requirements, and we are submitting it to GFOA to determine its
eligibility for another award.
Port of Seattle
2013 Budget and Business Plan
TABLE OF CONTENTS
Organization
Budget Document Organization
I.
II.
Executive Summary
2013 CEO Budget Message
IV.
V.
VI.
I-1
Port View
A.
B.
C.
D.
E.
F.
III.
1
The Port of Seattle
History of the Port of Seattle
Facilities and Services
Strategic Planning
Commissioners and Officers
Organization Chart
II-1
II-1
II-1
II-3
II-5
II-6
Budget Overview
A. Business Plan Overview
B.
Operating Budget Overview
C.
Budget Overview-Staffing
D. Capital Budget Overview
E.
Tax Levy
III-1
III-2
III-7
III-8
III-9
Aviation Division
A. 2013 Budget Summary
B.
Business Plan Forecast
C.
Division Business Plan
D. Operating Budget Summary
E.
Staffing
F.
Aviation Capital Budget
G. Aviation Division Operating Statistics
IV-1
IV-3
IV-4
IV-15
IV-31
IV-32
IV-33
Seaport Division
A. 2013 Budget Summary
B.
Business Plan Forecast
C.
Division Business Plan
D. Operating Budget Summary
E.
Staffing
F.
Seaport Capital Budget
G. Seaport Division Operating Statistics
V-1
V-3
V-3
V-17
V-20
V-21
V-22
Real Estate Division
A. 2013 Budget Summary
B.
Business Plan Forecast
C.
Division Business Plan
D. Operating Budget Summary
E.
Staffing
F.
Real Estate Development Capital Budget
VI-1
VI-3
VI-3
VI-24
VI-27
VI-28
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Port of Seattle
2013 Budget and Business Plan
VII. Capital Development Division
A. 2013 Budget Summary
B.
Mission Statement
C.
Key Functions and Strategies
D. Division Budget Summary
E.
Staffing
F.
Capital Budget
G. Capital Development Division Summary
VII-1
VII-1
VII-2
VII-6
VII-8
VII-8
VII-8
VIII. Corporate
A. 2013 Budget Summary
B.
Mission Statement
C.
Key Functions and Strategies
D. Corporate Budget Summary
E.
Staffing
F.
Capital Budget
G. Corporate Summary
VIII-1
VIII -1
VIII -1
VIII-15
VIII-18
VIII -19
VIII -19
IX.
Tax Levy
A. Tax at a Glance
B.
Tax Levy Sources
C.
Tax Levy Uses
D. General Obligation Capacity
E.
Taxpayer Effect
F.
County Property Tax Comparison
IX-1
IX-1
IX-3
IX-7
IX-8
IX-8
X.
Capital Budget
X-1
XI.
Draft Plan of Finance
XI-1
XII. Statutory Budget
A. Introduction
B.
Statutory Budget Highlights
C.
Resolution
D. Tax Levy Calculation Sheet
E.
Forecasted Cash Flow Summary
XII-1
XII-1
XII-2
XII-4
XII-6
XIII. Appendices
A. Budget Policy, Process and Calendar
1. Operating Budget
2. Capital Budget
B.
Financial Management Policies
1. Key Financial Tools
2. Financial Policies and Description of Major Funds
3. Revenue and Expense Assumptions
C.
Business Assessment
D. Bond Amortization Schedules
E.
Aviation Landing Fee Revenues
F.
Other Detailed Expenditures
G. Glossary of Terms Used
H. Acronyms and Abbreviations
XIII-1
XIII-1
XIII-7
XIII-10
XIII-10
XIII-11
XIII-17
XIII-18
XIII-24
XIII-28
XIII-29
XIII-30
XIII-36
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Port of Seattle
2013 Budget and Business Plan
LIST OF TABLES
Table I-1
2013 Budget Summary
I-5
Table I-2
Cash Flow
I-6
Table III-1
Port of Seattle Business Plan Forecast
III-1
Table III-2
Revenues, Expenses, and Net Assets
III-4
Table III-3
Revenues and Expenses by Account Category
III-5
Table III-4
Table III-5
Port Staffing by Division
Capital Budget
III-7
III-8
Table IV-1
Aviation Division 2013 Cash Flow Summary
IV-1
Table IV-2
Aviation Business Plan Forecast
IV-3
Table IV-3
Aviation Key Measures
IV-3
Table IV-4
Aviation Revenue by Account
IV-27
Table IV-5
Aviation Operating & Maintenance Expenses by Account
IV-28
Table IV-6
Aviation Revenue and Expense by Business Group/Department
IV-29
Table IV-7
Table IV-8
Aviation Division Staffing
Aviation Division Capital Budget Summary
IV-31
IV-32
Table IV-9
Aviation Division Operating Statistics
IV-33
Table V-1
Seaport Division 2013 Cash Flow Summary
V-1
Table V-2
Table V-3
Seaport Business Plan Forecast
Lease and Asset Management Business Plan Forecast
V-3
V-11
Table V-4
Cruise and Maritime Operations Business Plan Forecast
V-16
Table V-5
Seaport Revenue by Account
V-17
Table V-6
Seaport Operating & Maintenance Expenses by Account
V-18
Table V-7
Seaport Revenue and Expense by Business Group/Department
V-19
Table V-8
Seaport Division Staffing
V-20
Table V-9
Seaport Division Capital Budget Summary
V-21
Table V-10
Table VI-1
Seaport Division Operating Statistics
Real Estate Division 2013 Cash Flow Summary
VI-22
VI-1
Table VI-2
Real Estate Division Business Plan Forecast
VI-3
Table VI-3
Real Estate Harbor Services Business Plan Forecast
VI-10
Table VI-4
Portfolio Management Business Plan Forecast
VI-15
Table VI-5
Eastside Rail Business Plan Forecast
VI-15
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Port of Seattle
2013 Budget and Business Plan
Table VI-6
Development and Planning Business Plan Forecast
VI-18
Table VI-7
Real Estate Revenue by Account
VI-24
Table VI-8
Real Estate Operating & Maintenance Expenses By Account
VI-25
Table VI-9
Real Estate Revenue and Expenses By Department
VI-26
Table VI-10
Real Estate Division Staffing
VI-27
Table VI-11
Real Estate Division Capital Budget Summary
VI-28
Table VII-1
Capital Development Division 2013 Budget Summary
VII-1
Table VII-2
Capital Development Division Expense by Department
VII-6
Table VII-3
Capital Development Division Revenues and Expenses by Account
VII-7
Table VII-4
Capital Development Division Staffing
VII-8
Table VII-5
Capital Development Division Summary
VII-8
Table VIII-1
Table VIII-2
Corporate 2013 Budget Summary
Administrative Expense by Department
VIII-1
VIII-15
Table VIII-3
Corporate Revenues and Expenses by Account
VIII -17
Table VIII-4
Corporate Division Staffing
VIII -18
Table VIII-5
Corporate Capital Budget
VIII -19
Table VIII-6
Corporate Summary
VIII –19
Table IX-1
Sources and Uses of Tax Levy
IX-4
Table IX-2
Table IX-3
Direct Levy or G.O. Bond Funded Committed Projects
Existing G.O. Bond Debt Service By Projects and Group
IX-5
IX-6
Table X-1
Capital Budget
X-1
Table X-2
Public Expense and Special Item Projects
X-5
Table X-3
Table XII-1
Non-Recurring Capital Budget Impact on the Operating Budget
Tax Levy Calculation Sheet
X-6
XII-4
Table XII-2
Forecasted Cash Flow Summary
XII-6
Table C-1
Summary Forecast
XIII-19
Table C-2
Table C-3
State Employment by Industry
Top 10 Public Companies in Washington
XIII-20
XIII-21
Table C-4
North American West Coast Ports’ Total Container Volumes
XIII-21
Table D-1
Bond Amortization Schedules for 2012
XIII-24
Table D-2
Table E-1
Bond Amortization Schedules for 2013
Landing Fee Revenue Calculation
XIII-26
XIII-28
Table F-1
Promotional Hosting by Division
XIII-29
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Port of Seattle
2013 Budget and Business Plan
LIST OF FIGURES
Figure I-1
Sources of Funds
I-7
Figure I-2
Uses of Funds
I-7
Figure II-1
Facility Map
II-2
Figure II-2
Organization Chart
II-6
Figure III-1
Operating Revenues by Source: 2013
III-6
Figure III-2
Operating Expenses by Usage: 2013
III-6
Figure III-3
Port Staffing by Division
III-7
Figure III-4
2013 Committed Capital Budget
III-8
Figure III-5
Tax Levy vs. Millage Rate 2004-2013
III-9
Figure IV-1
Aviation Division Sources of Cash
IV-2
Figure IV-2
Figure IV-3
Aviation Division Uses of Cash
Aviation Division Revenue by Account
IV-2
IV-27
Figure IV-4
Aviation Division Expense by Account
IV-28
Figure IV-5
Figure V-1
Aviation Division Committed Capital Budget
Seaport Division Sources of Cash
IV-32
V-2
Figure V-2
Seaport Division Uses of Cash
V-2
Figure V-3
Seaport Division Revenue by Account
V-17
Figure V-4
Seaport Division Expense by Account
V-18
Figure V-5
Seaport Division Committed Capital Budget
V-21
Figure VI-1
Real Estate Division Sources of Cash
VI-2
Figure VI-2
Real Estate Division Uses of Cash
VI-2
Figure VI-3
Figure VI-4
Real Estate Division Revenue by Account
Real Estate Division Expense by Account
VI-24
VI-25
Figure VI-5
Real Estate Division Committed Capital Budget
VI-28
Figure VII-1
Capital Development Division Expense by Department
VII-6
Figure VII-2
Figure VIII-1
Capital Development Division Expense by Account
Administrative Expense by Department
VII-7
VIII-16
Figure VIII-2
Administrative Expense by Account
VIII-17
Figure IX-1
Actual Tax Levy vs. Maximum Allowable Levy 1991-2013
IX-2
Figure IX-2
Figure IX-3
Tax Levy vs. Millage Rate 2004-2013
Assessed Valuation vs. Millage Rate 2004-2013
IX-2
IX-8
Figure IX-4
2012 Percentage of Tax Levies By Taxing District
IX-8
Figure XII-1
Sources of Cash
XII-7
Figure XII-2
Figure A-1
Uses of Cash
Operating Budget Process Flow Chart
XII-7
XIII-5
Figure A-2
Capital Budget Process Flow Chart
XIII-8
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Port of Seattle
Budget Organization
2013 Budget and Business Plan
BUDGET DOCUMENT ORGANIZATION
This document contains the operating, capital and statutory budgets, business plan and draft plan of finance
for the Port of Seattle and is organized as follows:

Section I has the Budget Message from the Chief Executive Officer depicting the 2013 plans, budget
highlights, a budget summary, which is summarized in Table I-1 and a cash flow summary in Table I-2
and charts depicting sources and uses of funds. Table I-1 depicts the operating revenues, expenses,
capital budget and full-time equivalent positions by division. This table differs from the other tables in
section III in that it shows the portion of the corporate/administrative expense that is not allocated to the
divisions. Otherwise, the division expenses would not add up to the total port expenses.

Section II, the Port View, contains the history of the port, its facilities and services, strategies, its
commissioners and officers and organization chart.

Section III, the Overview of the 2013 business plan and budget contains an executive summary
discussion of the Port’s Operating and Non-operating Budget, Capital Budget, and Tax Levy.
o
o
o
o
o
Table III-1 provides a summary of the Port business plan forecast for the period 2012-2017.
Table III-2 summarizes the Port's revenues, expenses, and net assets for the years 2009-2013.
Table III-3 summarizes the Port's operating revenues and expenses by major account, 2011-2013.
Table III-4 summarizes the Port's staffing by division, 2011-2013.
Table III-5 summarizes the Port's Capital Budget, 2013-2017.

The Operating Division summaries for the Aviation, Seaport, and Real Estate Divisions (Sections IV
through VI) present the summary business plans for each business group, operating budget, staffing, and
capital budget for each division. The operating budget is presented by business groups/departments as
well as by major revenue and expense accounts. One thing to note is that the business
groups/departments table in each division (Table IV-6, V-7, VI-9) differs from the other tables in that it
shows the division’s controllable costs only and does not reflect the direct charges and corporate
allocations expenses from the corporate and capital development divisions.

Sections VII and VIII present a summary of the Capital Development Division and Corporate,
descriptions of the departments, operating budgets, staffing, and capital budgets.

A detailed presentation and discussion of the Tax Levy is provided in Section IX.

Details of the Capital Budget are provided in Section X. A summary page presents the total capital
budget by business group and by division. Following the summary is a listing of the projects by business
group and division.

The Draft Plan of Finance is provided in Section XI.

The Statutory Budget, which is submitted to King County Council and King County Assessor, is
provided in Section XII.

The Appendices include detailed information regarding the budget and financial policies, business
assessment, bond amortization schedules, landing fee calculation, other detailed expenditures, glossary
of terms used and acronyms, are provided in Section XIII.
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Port of Seattle
Executive Summary
2013 Budget and Business Plan
PORT OF SEATTLE
MEMORANDUM
DATE:
August 6, 2012
TO:
Port Commission
FROM:
Tay Yoshitani, Chief Executive Officer
SUBJECT:
2013 Budget Message
INTRODUCTION
Budget Approach
As we prepare the Port’s budget for 2013, we are achieving positive results and our core businesses are
performing well compared to many of our peers. Some added good news is that Sea-Tac Airport’s new
Rental Car Facility opened in May and has already served its one millionth customer in July. We note,
however, that there remains uncertainty over the economic outlook, with high unemployment in the U.S.,
state and local budget challenges, the lingering Euro zone debt crisis and a slowdown in emerging
economies. Combined, these pose a continued risk to the strength of the economic recovery, and a slowing
economy could have a direct impact on our overall business in the coming year.
While the uncertainty continues, our best strategy is to be conservative in preparing our 2013 budget. Until
key revenue assumptions can be finalized, we will continue to focus on prudently managing O&M costs.
We expect to see some cost increases related to beginning the implementation of the Port’s Century Agenda
strategic plan, the full-year impact of the new airport rental car facility, and other new initiatives within the
business divisions.
Port Businesses Outlook
Sea-Tac Airport has seen steady growth during the first half of 2012. Total enplaned passengers have
increased 2.2 percent over 2011. International enplanements have grown at 5.2 percent, while domestic
enplanements have increased by 1.8 percent over 2011. This growth rate exceeds the forecasted growth
rate of 1.5 percent for 2012, but is consistent with the airport’s long-term growth rate forecast. The
airport’s strategic focus for 2013 will be to plan for the future while continuing to manage airline costs and
increase non-aeronautical net operating income in the near term. Key initiatives include continuing
concessions master planning, launching a sustainable airport master plan to clarify the long-term capacity
of the airport, and continuing to build capacity for Continuous Process Improvement (CPI) initiatives.
Seaport Division operating revenue is expected to be 10.6 percent higher than the 2012 budget, primarily
due to the accounting effect of refunding the Terminal 18 Special Facility Bonds in late 2011 that was not
reflected in the 2012 budget. Revenues driven by grain volumes and cruise passengers are expected to be
down as a result of mixed grain harvest conditions in the Midwest and one less weekday homeport cruise
ship. Seaport’s 2013 goals include retaining container, cargo and passenger volumes, focusing on potential
opportunities for new growth, implementing the asset stewardship program for key division assets, and
continuing implementation of The Green Gateway strategy.
Real Estate Division operating revenue is expected to be about 1.3 percent less than the 2012 budget level.
Conference and Event Center revenue is expected to match 2011 actual levels, but come in 5 percent lower
than assumed in the 2012 budget. Revenues for commercial and recreational marinas are expected to be
flat compared to the 2012 budget. Lease revenue is expected to increase slightly as the local real estate
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Port of Seattle
Executive Summary
2013 Budget and Business Plan
market continues to recover, and the division is pursuing several new real estate development
opportunities. However, the risk remains for higher vacancies in commercial properties and marinas. Key
2013 focus areas for the division will be overall cost management, property renewal and replacement, and
management of the Eastside Rail Corridor sections retained by the port.
Looking Ahead
The Commission’s Century Agenda strategic plan will provide aspirational goals to guide us for the next
twenty five years, and we will continue to invest in new facilities that support the economic vitality of the
region. The terminal realignment at the airport is well underway to accommodate merged airlines, provide
space for individual carriers to grow, and optimize the use of the limited terminal space. We also will
continue with the design of the NorthSTAR program to refurbish and expand the North Satellite, as well as
upgrade Concourse C and sections of the Main Terminal. Another major initiative will be selection of a
long-term solution for expansion of the Federal Inspection Service facility to accommodate the growth in
international arrivals. These and many other smaller investments will enable us to serve our customers and
the general public better and improve the environment in our community and region.
BUSINESS PLAN/ OPERATING BUDGET
The fiscal management of the budget is the cornerstone of our success as a Port. The 2013 operating
revenues are budgeted at $550.6 million, a $33.7 million or 6.5% increase from 2012 budget. Operating
expenses are budgeted at $328.9 million, a $19.1 million or 6.2% increase compared to 2012 budget. Net
Operating Income before Depreciation is $221.7 million, a $14.6 million or 7.1% increase.
Aviation
The Aviation Division manages Aeronautical and Non-aeronautical sides of its business. On the
Aeronautical side, the Port’s goal is to manage cost in terms of cost per enplanement (CPE). The budgeted
2013 CPE is $13.80, compared to $13.26 in the 2012 budget. On the non-aeronautical side, the primary
goal is to increase cash flow as measured by net operating income (NOI).
Operating revenues are budgeted at $407.6 million. Revenues from airlines are $249.3 million and nonairline revenues are $157.8 million. Total operating expenses are budgeted at $241.7 million. Net operating
income before depreciation is $165.9 million.
Seaport
The Seaport includes two major business groups: Lease & Asset Management and Cruise & Maritime
Operations. There are also service groups within the Seaport Division including Commercial Strategy,
Environmental Services & Planning, and Finance. These businesses and service groups oversee the
marketing, strategic development, and management of cargo and cruise terminals, moorage facilities, and
industrial properties connected to these businesses.
Seaport operating revenues are budgeted at $110.3 million. Total operating expenses, including corporate
costs, are $47.0 million. Net operating income before depreciation is $63.2 million.
Real Estate
The Real Estate Division includes five functional workgroups: Real Estate Development & Planning,
Harbor Services, Marine Maintenance, Portfolio Management and Pier 69 Facilities Management. These
business and service groups oversee the development and management of various Port assets including
vessel moorage facilities. Financial services, environmental services and planning are supported by the
Seaport Division.
Real Estate operating revenues are budgeted at $32.5 million. Total operating expenses including corporate
costs are $39.0 million. Net operating income before depreciation is negative $6.5 million.
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Port of Seattle
Executive Summary
2013 Budget and Business Plan
Capital Development
The Capital Development Division (CDD) includes six functional workgroups: Engineering, Port
Construction Services, Aviation Project Management Group, Seaport Project Management Group, Central
Procurement Office, and CDD Administration. The CDD delivers projects and provides technical and
contracting services in support of the business plans and infrastructure needs of the Port of Seattle.
Capital Development operating expenses are budgeted at $14.8 million.
Corporate
The three operating divisions of the Port are supported by a number of functional departments as well as
service groups, including the Port’s Police Department. These functional and service groups allocate their
expenses according to the level of service they provide to the divisions. Corporate operating expenses are
budgeted at $78.8 million.
CAPITAL BUDGET
The total capital budget for 2013 is $225.5 million and the five year capital improvement program is $1.9
billion, which reflects the Port's continuing commitment to promoting regional economic activity through
the investment in the development, expansion, and renewal of Port facilities that supports the Port’s
Business Plan and Green Initiative.
TAX LEVY
The Port’s 2013 Budget assumes a levy amount of $73.0 million, no change from 2012; however, due to
the decline in assessed value, the tax levy rate will increase slightly from $0.2313 to $0.2326 per $1,000 of
assessed value. The Tax Levy, Section IX of this document provides details on the uses of the Port’s levy.
SUMMARY
The Port has an exceptional track record in prudent and proactive budget management due to the hard work
and efforts of our highly skilled and professional staff. I am confident that we can continue the Port’s
strong record of success into 2013 and beyond. The annual budget is an essential management tool to plan
and sustain our businesses. I appreciate your support and commitment to the 2013 budget.
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Port of Seattle
Executive Summary
2013 Budget and Business Plan
2013 Budget Highlights
The Port takes a conservative approach for the 2013 Budget and strives to maintain a strong bottom line.
We also continue to invest in business operations that retain and attract customers, create jobs, assure best
value and return on investment, and help position the Port for future growth.

Operating revenues are budgeted at $550.6 million, a $33.7 million or 6.5% increase from 2012
budget. Aeronautical revenues, which are based on cost recovery, are $249.3 million, an increase
of $13.6 million or 5.7%. Other operating revenues are $301.3 million, an increase of $20.1 million
or 7.2% compared to 2012 budget mainly due to Terminal 18 special bond refunding and higher
Concessions and RCF revenues.

Total Revenues, which include the $550.6 million operating revenues and $192.5 million nonoperating revenues, are $743.1 million, a $21.6 million or 3.0% increase from 2012 budget.

Operating expenses are $328.9 million for 2013 budget, a $19.1 million or 6.2% increase from
2012 budget mainly due to Terminal Realignment expense, full-year operation of the new Rental
Car Facility and busing service, and environmental remediation expense.

Other key drivers for cost increase in 2013 budget are baseline payroll and contractual increases,
deferred maintenance, Century Agenda support, utilities costs, business & occupation taxes, and
other new initiatives.

To mitigate rising medical costs, the Port will continue the self-funding medical plan in 2013 and
ask employees for more medical cost sharing. These and other measures, including the Spirit and
Wellness Program, help keep the medical and dental costs at a moderate 2.2% increase for 2013.

The average pay increase for non-represented employees is budgeted at 3.0% for 2013, which is in
line with the projected average increase in the regional salary planning surveys.

Despite the increased costs, the Port’s net operating income is forecasted to remain strong at $221.7
million, $14.6 million or 7.1% higher than 2012 budget.

Operating expenses are $328.9 million and non-operating expenses including depreciation are
$333.7 million for 2013 budget. Total expenses are $662.6 million, a $20.2 million or 3.1%
increase from 2012 budget.

Net operating income after depreciation is $50.2 million and net non-operating income is $30.3
million, resulting in an $80.5 million increase in Net Assets for 2013 budget. This represents a
$1.4 million or 1.8% increase from 2012 budget.

The Port’s capital budget for 2013 is $225.5 million, which includes investments in projects that
create near-term jobs, as well as environmental initiatives and congestion relief projects that ease
the movement of freight throughout the region.

Major capital projects for 2013 include: North Satellite Renovation, Terminal Realignment,
Aircraft RON Parking, Highline School Insulation, Ground Service Equipment (GSE) Electrical
Charge Stations, Terminal Escalator Modernization, Central Plant Pre-conditioned Air, Street
Vacation Related Projects, Pier 90 C175 Roof Replacement, T46 Dock Rehabilitation, T106 &
T108 Drainage & Paving, and Pier 69 Built-Up Roof Replacement.
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Port of Seattle
Executive Summary
2013 Budget and Business Plan
TABLE I-1: 2013 BUDGET SUMMARY
($ in 000's)
OPERATING BUDGET
Airline Revenue
Non-Airline Operating Revenues
Fuel Hydrant Facility
Total Operating Revenues
Notes
$
Aviation
249,285
157,826
514
407,625
Seaport
Real Estate
Capital
Corporate
110,283
32,516
110,283
32,516
0
155
155,676
48,520
16,891
16,000
4,615
241,702
28,250
13,358
4,265
32,179
5,331
1,412
0
0
1,165
1,170
47,043
80
39,002
0
0
1,165
216,106
68,374
22,568
16,000
5,865
328,912
Net Operating Income before Depreciation
165,923
63,240
(6,486)
0
(1,010)
221,668
Depreciation
126,977
35,022
9,509
38,947
28,218
(15,995)
0
(1,012)
50,158
(112,196)
5,131
0
(769)
459
(1,968)
0
64,844
20,553
7,839
(6,367)
1,269
(21,205)
(14,816)
2,073
(3,050)
(2,163)
40,349
(2,501)
(11,273)
0
0
0
0
300
8,919
(2,302)
91
(1,750)
(1,041)
15,957
0
(2,017)
0
0
0
0
340
9,278
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
16,235
0
0
0
0
0
0
0
16,235
(129,314)
7,296
(4,800)
(3,972)
73,000
(4,469)
(13,291)
64,844
20,553
7,839
(6,367)
1,909
13,227
0
0
0
(6,717) $
-
Operating and Maintenance Expense
Corporate Administrative Expense
Law Enforcement Costs
Airline Realignment
Environmental Expense
Total Operating Expense
1
2
Net Operating Income after Depreciation
Revenue Bond Interest Expense
Interest Income
Non-Op Environmental Expense
Other Non-Op Income (Expense)
Ad Valorem Tax Levy Revenue
Public Expense
G.O. Bond Interest & Amortization
Passenger Facility Charges
Customer Facility Charges
Fuel Hydrant revenue
PFC Bond Interest & Amortization
Non Capital Grants and Donations
Net Non-operating
3
4
Capital Contributions
Revenue Over Expense
CAPITAL BUDGET
Committed
Business Plan Prospective
Total
EMPLOYEES
Total FTE's
16,230
$
33,971
Aviation
151,193
33,047
$
184,240
$
838
$
37,975
$
155
Total
$ 249,285
300,780
514
550,579
2
Seaport
Real Estate
Capital
11,547 $ 16,788 $
742
1,500
300
0
$ 13,047 $ 17,088 $
742
$
Aviation
846.8
Seaport
Real Estate
60.0
168.3
Capital
265.5
$
15,223
171,510
17,068
$
80,453
Corporate
$
8,861
1,525
$ 10,386
Total
$ 189,131
36,372
$ 225,503
Corporate
449.2
Total
1,789.7
ONEPGSUM.XLSX
Notes:
1) Capital Development Division and Corporate allocates expenses to the Aviation, Seaport and Real Estate divisions.
2) 2013 Budget law enforcement costs includes Police costs.
3) See Tax Levy Section IX for detail of tax levy use.
4) Fuel Hydrant non-cash recorded as non-operating revenues based on Accounting change.
filename: _1 Executive Summary
updated: 2/20/2013
I-5
Port of Seattle
Executive Summary
2013 Budget and Business Plan
TABLE I-2: CASH FLOW SUMMARY
($ in 000's)
2013
Beginning balance of cash & investments
$
SOURCES OF CASH
Operating Revenues
Interest Receipts
Proceeds from Bond Issues
Grants and Capital Contributions
Tax Levy
Passenger Facility Charges
Rental Car Customer Facility Charges
Fuel Hydrant Receipts
Other Receipts
Total
USES OF CASH
Expenses from Operations:
Operating & Maintenance Expense
Corporate Administrative Expense
Law Enforcement Costs
Environmental Expenditures
Total Operating Expenses
Debt Service:
Interest Payments
Bond Redemptions
Total Debt Service
774,038
550,579
7,296
0
18,977
73,000
64,844
20,553
7,839
713
743,800
Anticipated available funds
Percent
of Total
74.0%
1.0%
0.0%
2.6%
9.8%
8.7%
2.8%
1.1%
0.1%
100%
1,517,840
240,510
59,970
22,568
5,865
328,912
28.1%
7.0%
2.6%
0.7%
38.4%
288,291
17.4%
16.2%
33.7%
9,485
4,469
225,503
856,661
1.1%
0.5%
26.3%
100%
149,346
138,945
Other Expenses
Public Expense
Capital Expenditures
Total
Ending balance of cash & investments
$
661,178
Increase (decrease) of cash during year
$ (112,860)
cashflow.xlsx
filename: _1 Executive Summary
updated: 2/20/2013
I-6
Port of Seattle
Executive Summary
2013 Budget and Business Plan
FIGURE I-1: SOURCES OF FUNDS
($ in 000’s)
Grants and Capital
Contributions
2.6%
Rental Car Customer
Facility Charges
2.8%
Fuel Hydrant Receipts
1.1%
Other Receipts
Passenger Facility Charges
0.8%
8.7%
Tax Levy
9.8%
Operating Revenues
74.0%
Interest Receipts
0.1%
Total Sources: $743,800
FIGURE I-2: USES OF FUNDS
($ in 000’s)
Public Expense
0.6%
Other Expenses
1.1%
Operating &
Maintenance Expense
28.1%
Capital Expenditures
26.3%
Corporate
Administrative Expense
7.0%
Bond Redemptions
12.1%
Interest Payments
17.4%
Law Enforcement Costs
2.6%
Environmental
Expenditures
0.7%
Total Uses: $856,661
filename: _1 Executive Summary
updated: 2/20/2013
I-7
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filename: _1 Executive Summary
updated: 2/20/2013
I-8
Port of Seattle
Port view
2013 Budget and Business Plan
A. THE PORT OF SEATTLE
The Port of Seattle, (the “Port”), is a public enterprise with unique authority operating in an international,
market-driven environment. The Port provides services to its customers in order to return benefits to the
citizens of King County, giving careful consideration to the economic, social, and environmental
implications of its decisions.
The Port is comprised of three operating divisions, namely Aviation, Seaport, and Real Estate, as well as
the Capital Development Division and Corporate. The Aviation Division manages the Seattle-Tacoma
International Airport, (“Sea-Tac”). The Seaport Division manages (primarily through leases) cargo and
passenger marine terminals as well as industrial property connected with maritime businesses. The Real
Estate Division manages moorage facilities, leases commercial and industrial buildings/properties, and
plans and facilitates the development of selected real estate assets.
The Capital Development Division delivers projects and provides technical and contracting services in
support of the business plans and infrastructure needs of the Port.
Corporate provides high quality and cost-effective professional and technical services to the divisions and
supports the overall goals of the Port.
B. HISTORY OF THE PORT OF SEATTLE
The Port was established in 1911 in an effort by citizens to ensure public ownership of the Seattle harbor.
The Port of Seattle was the first autonomous municipal corporation in the United States specifically tasked
to develop harbor and Port facilities to encourage commerce. The Port opened Fishermen’s Terminal in
1912, its first warehouse in 1915 and began working on the creation of Harbor Island. Since then, the Port
has developed numerous properties as well as constructed the Seattle-Tacoma International Airport in 1949.
The Port’s task hasn’t changed over the years but its scope of services has expanded considerably. The
Port continues to upgrade and modernize its facilities to meet current market demands. The Port has added
container terminals, a grain terminal, cruise terminals, marinas, public parks and viewpoints and
contributed significantly to the development of public amenities along Seattle’s waterfront.
C. PORT OF SEATTLE FACILITIES AND SERVICES
Sea-Tac is located on 2,800 acres sixteen miles south of downtown Seattle. The Port has invested
approximately $3.9 billion in capital improvements at the airport since 1999. The airport includes 3
runways that are 11,900 feet, 9,425 feet, and 8,500 feet in length and a subway system linking the
concourses. Sea-Tac is the 16th largest U.S. airport as measured by total passengers and compared to other
large airports and has relatively high originations and destinations traffic.
Seaport facilities encompass approximately 1,200 acres of moorage and cargo-related facilities. Over 500
acres are dedicated to container operations at 4 terminals with over 12,300 feet of container berth space and
24 cargo cranes-including 7 Super Post-Panamax cranes. The Seaport also owns a fully automated grain
terminal and general purpose maritime facilities, and home to the North Pacific factory trawler fishing fleet.
The Seaport also operates 2 cruise vessel terminals with a total of 3 berths. In addition, the Seaport leases
industrial property connected with these cruise, cargo, and factory trawler fishing businesses.
The Real Estate Division manages the Port’s holdings in commercial real estate, recreational marinas,
industrial fishing terminals and developable property. This division was formed in 2008 and allows the
Seaport and Aviation Divisions to concentrate on their core businesses.
II-1
Port of Seattle
Port view
2013 Budget and Business Plan
FIGURE II-1: FACILITY MAP
II-2
Port of Seattle
Port view
2013 Budget and Business Plan
D. STRATEGIC PLANNING
The Port Commission is currently updating the Port’s strategic plan, anticipating completion by year end
2012. Called the “Century Agenda,” it will focus on the Port’s next quarter-century of business and
operations. The goal of the Century Agenda is to build upon the accomplishments of the past century with a
visionary look forward to the emerging challenges and opportunities of the 21st century. This commissionled process includes stakeholder roundtables, robust public outreach, port employee engagement, planning
through our major lines of business and development of strategies, objectives and regional initiatives.
Strategic Overview
The Port’s strategic planning is driven by several key strategic challenges and opportunities facing the
institution and the region today, with the goal of long-term sustainability. These challenges and
opportunities include:






Increasing competition from other ports, airports, and regions
Decreasing availability of public funds
Decreasing profit margins for most Port’s customers
Increasing surface traffic congestion
Growing community interest in sustainability to achieve a long-term balance of economic, social
and environmental objectives and values
Influencing the demographics changes in present and future workforce
The strategic focus of the organization for 2013 will center on the following framework.
Mission
The Port of Seattle is a public agency that creates jobs by advancing trade and commerce, promoting
industrial growth, and stimulating economic development.
Our Century Agenda Values
This Century Agenda values statement represents our commitment to how the Port operates in the
community: “We create economic opportunity for all, steward our environment responsibly, partner with
surrounding communities, promote social responsibility, conduct ourselves transparently, and hold
ourselves accountable. We will leave succeeding generations a stronger Port.”
Our Vision:
Over the next 25 years we will add 100,000 jobs through economic growth led by the Port of Seattle,
for a total of 300,000 port-related jobs in the region, while reducing our environmental footprint.
Strategies
Listed below are the 25-year strategies and objectives:
Position the Puget Sound region as a premier international logistics hub
 Grow seaport annual container volume to more than 3.5 million TEUs
 Structure our relationship with Washington ports to optimize infrastructure investments and
financial returns
 Triple air cargo volume to 750,000 metric tons
 Triple the value of our outbound cargo to over $50 billion
 Double the economic value of the fishing and maritime cluster
II-3
Port of Seattle
Port view
2013 Budget and Business Plan
Advance this region as a leading tourism destination and business gateway
 Make Sea-Tac Airport the west coast “Gateway of Choice” for international travel
 Double the number of international flights and destinations
 Meet the region’s air transportation needs at Sea-Tac Airport for the next 25 years and encourage the
cost-effective expansion of domestic and international passenger and cargo service
 Double the economic value of cruise traffic to Washington State
Use our influence as an institution to promote small business growth and workforce development
 Increase the proportion of funds spent by the Port with qualified small businesses firms on
construction, goods and services to 25% of the eligible dollars spent
 Increase work force training, job and business opportunities for local communities in maritime,
trade, travel and logistics
Be the greenest and most energy efficient port in North America
 Meet all increased energy needs through conservation and renewable sources
 Meet or exceed agency requirements for storm water leaving Port owned or operated facilities
 Reduce air pollutants and carbon emissions, specifically:
 Reduce air pollutant emissions by 50% from 2005 levels
 Reduce carbon emissions from all Port operations by 50% from 2005 levels and reduce
aircraft-related carbon emissions at Sea-Tac by 25%
 Anchor the Puget Sound urban-industrial land use to prevent sprawl in less developed areas
 Restore, create, and enhance 40 additional acres of habitat in the Green/Duwamish watershed and
Elliott Bay
We will use the Port’s real estate, capital assets and financial capabilities to accomplish our Century
Agenda goals. We regard these as tools to thoughtfully steward, rather than areas well suited for
specific 25-year goals.
With the Port Commission, Port staff proposed five-year milestones and actions to meet the goals.
These Actions outline the operational steps for the Port’s individual business lines to contribute
strategy and resources to the Century Agenda, as they perform the Port’s core business. These
actions are incorporated throughout the Port’s divisional business plans and budgets for 2013 and
beyond.
II-4
Port of Seattle
Port view
2013 Budget and Business Plan
E. COMMISSIONERS AND OFFICERS
The Port Commission is the legally constituted governing body of the Port of Seattle. As a governing body
of a special purpose municipal corporation, it is charged with the responsibility of fulfilling legislatively
mandated purposes and objectives.
The Port Commission is made up of five elected individuals. They are:
Gael Tarleton, Chair and President
John Creighton, Vice President
Tom Albro, Secretary
Bill Bryant, Assistant Secretary
Rob Holland, Commissioner
The senior officers of the Port are:
Tay Yoshitani, Chief Executive Officer
Kurt Beckett, Chief of Staff
Mark Reis, Managing Director, Aviation
Linda Styrk, Managing Director, Seaport
Dan Thomas, Chief Financial and Administrative Officer
Craig Watson, General Counsel
Ralph Graves, Managing Director, Capital Development
Joe McWilliams, Managing Director, Real Estate
Patricia Akiyama, Director, Public Affairs
Colleen Wilson, Chief, Police Department
II-5
Port of Seattle
Port view
2013 Budget and Business Plan
F. ORGANIZATION CHART
FIGURE II-2: ORGANIZATION CHART
King County Voters
Commission
Executive Office
Aviation
Seaport
Real Estate
846.8 FTEs
60 FTEs
168.3 FTEs
Internal Audit
Capital
Development
Corporate *
449.2 FTEs
265.5 FTEs
Business
Development
Airport
Operations
Lease & Asset
Management
Development &
Planning
Aviation Project
Management
Accounting &
Financial
Reporting
Public Affairs
Facilities
Management
Capital
Development
Administration
Finance & Budget
Health & Safety
Harbor Services
Central
Procurement
Office
Human Resources
& Development
Information &
Communications
Technology
Engineering
Legal
Labor Relations
Port Construction
Services
Police
Department
Office of Social
Responsibility
Airport
Properties
Aeronautical
Cruise &
Maritime
Operations
Business
Development &
Management
Landside
Commercial
Strategy
Concessions
Community
Development
Aviation
Facilities
Finance &
Budget
Building
Department
Environmental
Management
and Planning
Airport Office
Building
Management
Facilities &
Infrastructure
Security
Fire
Department
Environmental
Planning
Finance &
Budget
Seaport
Administration
Fishing &
Commercial
Vessels
Recreational
Boating
Marine
Maintenance
Seaport Project
Management
Risk Management
Portfolio
Management
Real Estate
Administration
Utilities
Aviation
Maintenance
*For reporting purposes, Commission Office, Executive Office, and Internal Audit all roll up to Corporate.
II-6
Port of Seattle
Budget Overview
2013 Budget and Business Plan
A. BUSINESS PLAN OVERVIEW
Table III-1 below is a summary of the combined business plan forecasts of the Port’s operating divisions, which can be found in Sections IV, V and VI.
TABLE III-1: PORT OF SEATTLE BUSINESS PLAN FORECAST
($ in 000's)
OPERATING BUDGET
Airline Revenue
Non-airline Revenue
Fuel Hydrant Facility
Total Operating Revenues
Operating & Maintenance Expense
Corporate & Capital Development Division Costs
Law Enforcement Costs
Airline Realignment
Environmental Expense
Total Operating & Maintenance Expenses
Budget
2012
Notes
$
1
235,706
280,665
514
516,882
Budget
2013
$
249,285
300,780
514
550,579
Compound
Growth
2012 - 2017
Forecast
2014
$
246,207
330,038
514
576,759
2015
$
269,294
339,860
514
609,668
2016
$
287,994
344,780
514
633,288
2017
$
303,201
359,130
514
662,845
5.2%
5.1%
0.0%
5.1%
2.4%
2.9%
2.7%
209,280
66,693
22,573
8,200
3,096
309,844
216,106
68,374
22,568
16,000
5,865
328,912
222,018
69,505
23,330
0
4,753
319,607
222,385
71,883
24,119
0
4,896
323,284
231,595
74,346
24,936
0
5,043
335,919
235,273
76,896
25,781
0
5,194
343,145
10.9%
2.1%
Net Operating Income Before Depreciation
207,039
221,668
257,152
286,384
297,369
319,700
9.1%
Total Depreciation Expense
Net Operating Income after Depreciation
158,479
48,560
171,510
50,158
Committed Capital Budget
Business Plan Prospective
TOTAL CAPITAL BUDGET
1
1
$
$
2
$
310,478
80,551
391,029
$
$
$
189,131
36,372
225,503
$
$
224,662
133,242
357,904
$
$
191,754
253,671
445,425
$
$
87,950
429,010
516,960
$
$
22,325
296,322
318,647
Total
2013 - 2017
$
715,822
1,148,617
$ 1,864,439
POSBPFOR.XLS
Notes:
1) Includes revenue from Corporate & Capital Development departments and corresponding offset to allocated charges from Corporate departments.
2) See Section X for details of Capital Budget.
filename: Budover.doc
updated: 2/20/2013
III-1
Port of Seattle
Budget Overview
2013 Budget and Business Plan
B. OPERATING BUDGET OVERVIEW
OVERVIEW
The 2013 budget proposes total operating revenues of $550.6 million and total operating expenses of $328.9
million. Net Operating Income before Depreciation calculates to $221.7 million. Net Operating Income
after Depreciation is budgeted at $50.2 million.
AVIATION DIVISION
The Aviation Division operates the Seattle-Tacoma International Airport, which was the sixteenth largest US
airport as measured by total passengers in 2011. Enplaned passenger growth at Sea-Tac Airport in 2012 has
been closely aligned with the budgeted growth rate of 1.5%. This followed the unexpectedly high growth of
3.9% in 2011. Year-to-date traffic growth rates through August show 1.4% for domestic and 5.8% for
international for a combined growth rate of 1.8%. The 2013 budget assumes growth of 2.2%, which is
consistent with the long-term forecast for growth at Sea-Tac. Current and long-term cost management
continues to be a strategic focus of Sea-Tac Airport.
Operating revenues are budgeted to be $407.6 million, a $21.9 million or 5.7% increase from 2012 budget.
Aeronautical revenues are budgeted to $249.3 million, an increase of $13.6 million or 5.8%, and non-airline
revenues are budgeted to be $157.8 million, an increase of $8.3 million or 5.5%, compared to 2012 budget.
Total airport operating expenses are budgeted to total $241.7 million. This represents a 7.4% increase
compared to the 2012 budget. For the Aviation Division alone, the 2013 budget is increasing by 9.5%
primarily due to terminal realignment and full-year of consolidated rental car facility operation. Net
operating income before depreciation is $165.9 million.
SEAPORT DIVISION
The Seaport includes two major business groups: Lease & Asset Management and Cruise & Maritime
Operations. There are also service groups within the Seaport Division including Commercial Strategy,
Environmental Services & Planning, and Finance. These businesses and service groups oversee the
marketing, strategic development, and management of cargo and cruise terminals, moorage facilities, and
industrial properties connected to these businesses.
The most critical measure of the Seaport’s financial sustainability is a growing, positive Net Operating
Income (NOI). Only with strong financial performance, can the Seaport provide the economic, community
and environmental benefits that are the essence of its mission.
Seaport operating revenues are $110.3 million. Total operating expenses including corporate costs are $47.0
million. Net operating income before depreciation is $63.2 million.
REAL ESTATE DIVISION
The Real Estate Division is committed to increasing the economic vitality of our region and generating new
business opportunities for the Port. This will be accomplished by leveraging the Port’s partnerships with
local and regional commercial and industrial businesses and real estate partners. The Real Estate Division
also intends to identify and pursue opportunities that enhance the region’s long-term vitality and ultimately
produce new revenue for the Port.
The Real Estate Division integrates the efforts of five functional workgroups: Real Estate Development &
Planning, Harbor Services, Marine Maintenance, Portfolio Management and Pier 69 Facilities Management.
These business and service groups oversee the development and management of various Port assets including
vessel moorage facilities. Financial services, project management, and environmental services are supported
by the Seaport Division.
filename: Budover.doc
updated: 2/20/2013
III-2
Port of Seattle
Budget Overview
2013 Budget and Business Plan
Real Estate operating revenues are $32.5 million. Total operating expenses including corporate costs are
$39.0 million. Net operating loss before depreciation is $6.5 million.
CAPITAL DEVELOPMENT DIVISION
The Capital Development Division (CDD) delivers projects and provides technical and contracting services
in support of the business plans and infrastructure needs of the Port. The three operating divisions of the Port
are supported by the CDD based on level of project and contracting services required to support their
operations and capital & expense project needs. The services by the departments within the division are
demand driven.
Operating expenses for Capital Development Division are $14.8 million for 2013.
CORPORATE
The three operating divisions and Capital Development division are supported by a number of functional
departments as well as service groups. These functional and service groups allocate their expenses according
to the level of service they provide to the divisions. Many of the corporate departments are vital to the
success of the operating divisions for providing essential services such as accounting, legal services,
computer support, etc. Their services also benefit the public in general and play an indirect role in the
success of the operating divisions.
Operating expenses for Corporate are $78.8 million for 2013.
NON-OPERATING REVENUE AND EXPENSE
Non-operating revenues are budgeted to be $192.1 million and non-operating expenses are budgeted to be
$162.2 million; net non-operating income is budgeted at $30.3 million. The budget contains a tax levy
amount of $73.0 million. The millage rate is estimated to be $0.2326/1000.
CASH FLOW SUMMARY
Table I-2 from section I, page 6, reveals that operating revenues makes up 74.0% of the Port’s budgeted cash
receipts for 2013. The tax levy is projected to be $73.0 million and accounts for 9.8% of total budgeted
receipts in 2013.
Total cash outlays are budgeted to be $856.7 million for 2013. Total operating expenses (including
Operating & Maintenance, Corporate Administrative, Law Enforcement Costs and Environmental Reserve)
makes up 38.4% and capital expenditures make up 26.3% of the total cash outflow.
filename: Budover.doc
updated: 2/20/2013
III-3
Port of Seattle
Budget Overview
2013 Budget and Business Plan
TABLE III-2: REVENUES, EXPENSES, AND NET ASSETS
($ in 000's)
Notes
2009
Actual
2010
Actual
2011
Actual
2012
Budget
2012
Forecast
2013
Budget
$ 163,983
274,584
3,023
441,590
$ 174,562
284,898
3,119
462,579
$ 185,967
295,331
1,874
483,172
$ 205,244
308,880
2,758
516,882
$ 203,869
321,631
3,757
529,257
$ 206,182
343,547
850
550,579
OPERATING EXPENSES BEFORE DEPRECIATION:
Operations and maintenance
Law enforcement
Administration
Environmental
Total operating expenses before depreciation
182,995
19,136
43,636
245,767
188,678
19,949
44,837
253,464
195,200
21,923
50,293
267,416
236,907
23,490
46,351
3,096
309,844
224,037
22,466
53,496
4,448
304,447
250,985
23,493
48,568
5,865
328,912
NET OPERATING INCOME BEFORE DEPRECIATION
195,823
209,115
215,756
207,039
224,810
221,668
DEPRECIATION
157,068
160,775
158,107
158,479
161,474
171,510
38,755
48,340
57,649
48,560
63,336
50,158
75,587
59,689
21,866
7,845
7,153
17,251
(121,148)
(10,956)
(15,785)
(20,370)
(14,676)
(10,003)
(3,547)
73,125
59,744
23,243
7,911
12,473
13,096
(133,239)
(10,187)
(17,463)
(25,085)
(22,730)
(7,276)
(26,388)
73,179
62,358
23,669
7,683
8,482
18,884
(127,579)
(6,758)
(15,774)
(18,703)
(4,335)
7,815
28,921
73,000
63,448
21,333
7,839
1,779
5,748
(135,806)
(6,826)
(14,926)
(7,722)
(5,290)
(3,576)
(1,000)
73,000
63,448
21,333
7,839
3,156
5,748
(135,806)
(6,826)
(14,926)
(8,238)
(500)
(8,366)
(139)
73,000
64,844
20,553
7,839
1,909
7,296
(129,314)
(6,367)
(13,291)
(4,469)
(4,800)
(3,972)
13,227
INCOME BEFORE CAPITAL CONTRIBUTIONS
35,208
21,952
86,570
47,560
63,197
63,384
CAPITAL CONTRIBUTIONS
76,781
30,519
21,180
31,448
2,487
17,068
52,471
$ 107,750
65,684
80,453
OPERATING REVENUES:
Services
Property rentals
Operating grant and contract revenues
Total operating revenue
OPERATING INCOME
NON-OPERATING INCOME (EXPENSE):
Ad valorem tax levy revenue
Passenger facility charges revenue
Customer facility charges revenue
Fuel hydrant income
Non Capital Grants and donations
Investment income - net
Revenue and capital appreciation bond interest expense
Passenger facility charges revenue bond interest expense
General obligation bond interest expense
Public Expense
Non-Op Environmental Expense - net
Other (expense) income - net
Total non-operating (expense) income - net
INCREASE IN NET ASSETS
EMPLOYMENT (FTES)
$ 111,989
1779.3
$
1696.1
1712.2
$
79,008
1793.7
$
1788.2
1789.7
BDREVEXP
filename: Budover.doc
updated: 2/20/2013
III-4
Port of Seattle
Budget Overview
2013 Budget and Business Plan
TABLE III-3: REVENUES AND EXPENSES BY ACCOUNT CATEGORY
($ in 000's)
TOTAL PORT
Operating Revenue
Dckg, Whrfg, Serv & Facility, Passenger Fee
Equipment Rental
Berthage & Moorage
Landing Fees
Airport Transportation Fees
Parking Revenue
Revenue from Sale of Utilities
Property Rental Revenue
Other Revenue
Total Operating Revenue
2011
Actual
Notes
$
3,019
11,260
10,682
59,607
7,553
53,158
12,247
287,775
37,872
483,172
2012
Budget
$
3,389
8,374
10,378
70,198
7,459
55,736
11,937
301,421
47,992
516,882
2013
Budget
$
% Change
2013 Bud 2012 Bud
2,911
9,028
11,200
69,444
7,188
54,123
12,435
336,359
47,891
550,579
-14.1%
7.8%
7.9%
-1.1%
-3.6%
-2.9%
4.2%
11.6%
-0.2%
6.5%
Operating Expense
Salaries, Wages, Benefits & Workers Compensation
Equipment Expense
Utilities
Supplies & Stock
Outside Services
Travel & Other Employee Expenses
Promotional Expenses
Other Expenses
Total O&M without Environmental
186,861
7,092
21,393
7,278
47,385
3,863
1,617
21,480
296,969
211,788
5,958
21,180
6,739
62,395
5,531
1,249
23,093
337,938
218,715
5,865
22,056
6,564
71,482
5,839
1,591
23,919
356,030
3.3%
-1.6%
4.1%
-2.6%
14.6%
5.6%
27.4%
3.6%
5.4%
Environmental Expense
Total O&M with Environmental
801
297,770
3,096
341,034
5,865
361,895
89.4%
6.1%
Charges to Capital/Govt /Envrs Projects
(30,354)
(31,191)
(32,984)
5.7%
Expense after Charges to Capital Projects
$ 267,416
$ 309,844
$ 328,912
6.2%
table4.XLSX
filename: Budover.doc
updated: 2/20/2013
III-5
Port of Seattle
Budget Overview
2013 Budget and Business Plan
FIGURE III-1: REVENUES BY SOURCE: 2013
($ in 000’s)
Dckg, Whrfg, Serv & Equipment Rental
Facility, Passenger Fee
1.6%
0.5%
Berthage & Moorage
2.0%
Other Revenue
8.7%
Landing Fees
12.6%
Airport Transportation
Fees
1.3%
Parking Revenue
9.8%
Revenue from Sale of
Utilities
2.3%
Property Rental Revenue
61.1%
Total Revenue: $550,579
FIGURE III-2: EXPENSES BY USAGE: 2013
($ in 000’s)
Promotional Expenses
0.4%
Other Expenses
6.6%
Environmental Expense
1.6%
Travel & Other Employee
Expenses
1.6%
Outside Services
19.8%
Supplies & Stock
1.8%
Utilities
6.1%
Salaries, Wages, Benefits
& Workers Compensation
60.4%
Equipment Expense
1.6%
Total Expense Before Charges to Capital/Govt/Envrs Projects: $361,895
Charges to Capital/Govt/Envrs Projects: $32,984
Total Expense: $328,912
filename: Budover.doc
updated: 2/20/2013
III-6
Port of Seattle
Budget Overview
2013 Budget and Business Plan
C. BUDGET OVERVIEW - STAFFING
The 2013 budget proposes a decrease of 4.0 Full-time Equivalent positions (FTEs) to 1,789.7 FTEs compared to
1,793.7FTEs in the 2012 budget.
Aviation, Seaport and Real Estate divisions are budgeting 846.8, 60.0, and 168.3 FTEs, respectively for 2013.
The Capital Development Division is budgeting 265.5 FTEs and Corporate is budgeting 449.2 FTEs.
Aviation is decreasing 13.2 FTEs from the approved budget mainly due to a reduction of 12.0 Access Controllers
and 4.0 Customer Service Pathfinders.
Seaport is budgeting 60.0 FTE’s for 2013, which is .1 higher than 2012 budget, which is for a Property Manager
position to become full time.
Real Estate is budgeting 168.3 FTE’s, which is 2.5 higher than 2012 budget, a reduction of 3 FTEs and an
addition of 5.5 FTEs including 4 Maintenance Planners; Capital Development has an increase of 9.7 FTEs, 10.0
Construction positions including 4 Capital Project Managers and a decreased of a .25 Intern; and there is a
decrease in Corporate of 3.0 FTEs.
More information for each of these categories is provided in the Aviation, Seaport, Real Estate, Capital
Development Division, and Corporate sections of this document (Sections IV to VIII).
TABLE III-4: PORT STAFFING BY DIVISION
PORT STAFFING
(Full-Time Equivalent Positions)
Division
Aviation
Seaport
Real Estate
Capital Development
Corporate
Total FTE's
Note
2011
Actual
774.0
59.1
164.8
264.5
449.8
1,712.2
2012
Budget
860.0
59.9
165.8
255.8
452.2
1,793.7
2012
Est. Act.
858.1
60.0
163.8
255.8
450.7
1,788.2
2013
Budget
846.8
60.0
168.3
265.5
449.2
1,789.7
% Change
13 Bud- 13 Bud12 Bud
12 Est
-1.5%
-1.3%
0.2%
0.0%
1.5%
2.7%
3.8%
3.8%
-0.7%
-0.3%
-0.2%
0.1%
FTE.XLS
FIGURE III-3: PORT STAFFING BY DIVISION:
Corporate
25.1%
Aviation
47.3%
Capital
Development
14.8%
Real Estate
9.4%
Seaport
3.4%
Total FTEs: 1,789.7
filename: Budover.doc
updated: 2/20/2013
III-7
Port of Seattle
Budget Overview
2013 Budget and Business Plan
D. CAPITAL BUDGET OVERVIEW
For the Port to meet the waterborne and air transportation needs of the region and to serve its customers, it must
invest in the acquisition, development and maintenance of long-term assets. For an organization as large and
diverse as the Port, this requires comprehensive long-term capital planning which synthesizes the existing and
anticipated business environment, careful estimates of customer demand for facilities, available resources, and the
priorities of the organization.
The 2013 Capital Budget reflects the Port's continuing commitment to promoting regional economic activity
through the investment of $225.5 million in the development, expansion, and renewal of Port facilities. For a
complete discussion of the Port's long-term capital and funding plan, refer to Sections X and XI, Capital Budget
and Draft Plan of Finance.
Table III-5 below summarizes divisional spending in the 2013 Capital Budget:
TABLE III-5: CAPITAL BUDGET
($ in 000's)
Committed Capital Projects
Aviation Division
Seaport Division
Corporate & CDD Divisions
Real Estate Division
Total Committed
Business Plan Prospective Projects
Total CIP
2013
Budget
$151,193
11,547
9,603
16,788
$189,131
2013-2017
CIP
$596,871
55,507
26,423
37,021
$715,822
$36,372
$1,148,617
$225,503
$1,864,439
% of 2013
Total
79.9%
6.1%
5.1%
8.9%
100.0%
capsum.xls
Note: Definitions and details of the capital budget can be found in Section X.
FIGURE III-4: 2013 COMMITTED CAPITAL BUDGET
Real Estate Division
8.9%
Corporate & CDD
Divisions
5.1%
Seaport Division
6.1%
Aviation Division
79.9%
Total Spending: $189,131
filename: Budover.doc
updated: 2/20/2013
III-8
Port of Seattle
Budget Overview
2013 Budget and Business Plan
E. TAX LEVY

The maximum allowable levy for 2013 is $91.5 million.

For 2013 the levy will be $73.0 million.

The millage rate is estimated to be $0.2326.

The 2013 levy will be used for:
o
General Obligation (G.O.) Bonds Debt Service
o
Public Asset Expense: Freight Mobility
o
Seaport and Real Estate Environmental Remediation Liability
o
A portion of Real Estate operating expenses
o
Real Estate Capital Improvements
o
Seaport Argo Road Element capital project (partial funding)
o
Aviation School, and Highline and other Schools NOISE Insulation
o
Office of Port Jobs
o
Additions to the Transportation Infrastructure Fund (TIF)
FIGURE III-5: TAX LEVY VS. MILLAGE RATE 2004-2013
$ Millions
$80
$75.90
$0.70
$75.90
$73.50
$73.00
$73.00
$68.81
$70
$0.60
$62.78
$60
$73.50
$62.79
$59.66
$0.50
$50
$0.40
$40
$0.25
$0.30
$0.25
$0.23
$30
$0.23
$0.22
$0.22
$0.22
$0.23
$0.23
$0.20
$0.20
$20
$0.10
$10
$0
$0.00
2004
2005
2006
2007
2008
2009
2010
Tax Levy (Left Scale)
filename: Budover.doc
updated: 2/20/2013
2011
2012
Millage (Right Scale)
III-9
2013
This page was intentionally left blank.
filename: Budover.doc
updated: 2/20/2013
III-10
Port of Seattle
Aviation
2013 Budget and Business Plan
AVIATION DIVISION
A. 2013 BUDGET SUMMARY
TABLE IV-1: 2013 CASH FLOW
A. 2011 BUDGET SUMMARY
TABLE V-1: 2013 CASH FLOW
2013
($ in 000's)
SOURCES OF CASH
Operating Revenues
Interest Receipts
Proceeds from Bond Issues
Grants and Capital Contributions
Tax Levy
Passenger Facility Charges
Rental Car Customer Facility Charges
Fuel Hydrant Receipts
Other Receipts
Total
USES OF CASH
Expenses from Operations:
Operating & Maintenance expense
Corporate Administrative Expense
Law Enforcement Costs
Environmental Expenditures
Total Operating Expenses
Debt Service:
Interest Payments
Bond Redemptions
Total Debt Service
$
407,625
5,131
17,499
459
64,844
20,553
7,839
178
524,129
77.8%
1.0%
0.0%
3.3%
0.1%
12.4%
3.9%
1.5%
0.0%
100%
241,702
27.1%
7.7%
2.7%
0.7%
38.2%
204,665
18.6%
13.8%
32.3%
947
1,968
184,240
633,522
0.1%
0.3%
29.1%
100%
171,676
48,520
16,891
4,615
117,540
87,125
Other Expenses
Public Expense
Capital Expenditures
Total
$
Percent
of Total
cashflow.xlsx, AV
IV-1
Port of Seattle
Aviation
2013 Budget and Business Plan
FIGURE IV-1: SOURCES OF CASH
($ in 000’s)
Fuel Hydrant Receipts
1.5%
Passenger Facility Charges
Rental Car Customer
12.4%
Facility Charges
Other Receipts
Grants and Capital
3.9%
0.0%
Contributions
3.3%
Tax Levy
0.1%
Proceeds from Bond Issues
0.0%
Interest Receipts
1.0%
Operating Revenues
77.9%
Total Sources: $524,129
FIGURE IV-2: USES OF CASH
($ in 000’s)
Operating &
Maintenance expense
27.1%
Capital Expenditures
29.1%
Bond
Redemptions
10.1%
Public Expense
0.3%
Corporate
Administrative Expense
7.7%
Interest Payments
18.6%
Law Enforcement Costs
2.7%
Environmental
Expenditures
0%
Other Expenses
0.1%
Total Uses: $633,522
IV-2
Port of Seattle
Aviation
2013 Budget and Business Plan
B. BUSINESS PLAN FORECAST
TABLE IV-2: BUSINESS PLAN FORECAST
($ in 000's)
Budget
2013
2014
2015
2016
2017
$ 235,706
149,531
514
385,751
$ 249,285
157,826
514
407,625
$ 246,207
172,055
514
418,776
$ 269,294
179,989
514
449,797
$ 287,994
186,469
514
474,977
$ 303,201
190,755
514
494,470
5.2%
5.0%
0.0%
5.1%
149,673
47,145
16,964
8,200
3,096
225,078
155,676
48,520
16,891
16,000
4,615
241,702
162,450
49,976
17,398
0
4,753
234,576
165,462
51,475
17,920
0
4,896
239,753
170,272
53,019
18,457
0
5,043
246,791
174,361
54,610
19,011
0
5,194
253,176
3.1%
3.0%
2.3%
-100.0%
10.9%
2.4%
Net Operating Income Before Depreciation
160,673
165,923
184,200
210,044
228,187
241,294
8.5%
Total Depreciation Expense
Net Operating Income After Depreciation
117,072
43,602
126,977
38,947
OPERATING BUDGET
Airline Revenue
Non-airline Revenue
Fuel Hydrant Facility
Total Operating Revenues
Operating & Maintenance Expense
Corporate & Capital Development Division Costs
Law Enforcement Costs
Airline Realignment
Environmental Remediation (Regulated Materials)
Total Operating Expense
Committed Capital Budget
Business Plan Prospective
Total Capital Budget
Notes
1
2
3
261,926
69,558
$ 331,484
Forecast
Compound
Growth
2012-2017
Budget
2012
151,193
33,047
$ 184,240
185,012
85,932
$ 270,944
168,174
144,671
$ 312,845
77,309
377,460
$ 454,769
15,183
216,172
$ 231,355
Total
2013-2017
596,871
857,282
$ 1,454,153
AVBPFOR.xls
Notes:
1) Fuel Hydrant non-cash recorded as non-operating revenues based on Accounting change.
2) Consists of direct charges and allocations. Most costs are allocated using a formula based on Expenses and Employees
3) See Section X for details of Capital Budget.
TABLE IV-3: AVIATION KEY MEASURES
Budget
2013
2014
2015
Forecast
2016
2017
Key Measures
Non-Aero NOI ($ in 000's)
Cash Flow after Debt Service
Passenger Airline CPE
Debt Service Coverage
80,788
43,812
13.80
1.35
88,467
52,574
13.31
1.40
95,616
60,902
14.29
1.41
99,590
61,179
14.98
1.37
101,706
56,789
15.44
1.31
Traffic (in 000's)
Total Landed Weight
Enplanements
20,444
17,017
20,877
17,391
21,319
17,774
21,772
18,165
22,233
18,564
AVME AS URE S .XLS
IV-3
Port of Seattle
Aviation
2013 Budget and Business Plan
C. AVIATION DIVISION BUSINESS PLAN
MISSION:
Connecting our region to the world through flight. The journey begins here.
VISION:
We envision that Sea-Tac will be a welcoming front door, embodying the spirit of the Northwest – an
economic engine and a source of regional pride.
STRATEGIES/STRATEGIC GOALS:
1. Operate a world-class international airport by:
 Ensuring safe and secure operations
 Anticipating and meeting the needs of our tenants, passengers and the region’s economy
 Managing our assets to minimize the long-term total cost of ownership.
2. Become one of the top ten customer service airports in the world by 2015 (measured by the ACI ASQ
index).
3. Lead the airport industry in environmental innovation and minimize the airport’s environmental
impacts.
4. Reduce airline costs (CPE) as far as possible without compromising operational and capital needs.
5. Maximize non-aeronautical net operating income (NOI) consistent with current contracts, appropriate
use of airport properties and market demand.
6. Continually invest in a culture of employee development, organizational improvement, and business
agility.
7. Develop valued community partnerships based on mutual understanding and socially responsible
practices.
ECONOMIC OUTLOOK
As of October 2012, the economic outlook remains uncertain. U.S. gross domestic product (GDP) is
forecasted to grow by 2.1% for 2012, whereas European GDP is forecasted to drop by 0.5%. The U.S.
unemployment rate has come down, but remains high. There are signs that the U.S. economic recovery is
faltering. The Federal Reserve has launched a third round of quantitative easing to stimulate the economy.
Since the strength of the economy is the primary driver behind the demand for air travel, we assume near-term
(2012) growth in passenger levels will be modest (+1.5% in 2012). We are planning for a slow economic
recovery during 2012, with growth picking up by 2013. The threat of a double-dip recession remains a
possibility. While this is not part of our baseline assumptions, it does contribute to our conservative outlook,
and thus our forecast assumptions.
AIRLINE INDUSTRY ASSESSMENT
In spite of economic uncertainty, the domestic airline industry was profitable in 2010 and 2011 and is expected
to be profitable in 2012. The industry has consolidated and used bankruptcy to shed costs. The industry has
been largely successful in focusing on profit rather than growth. Smaller markets have been hurt by reduced
service as airlines rationalize networks and overall capacity. Large hubs with international connections have
been more likely to see growth than other airports.
Alaska Air Group (parent company of Alaska Airlines and Horizon Airlines), Sea-Tac’s largest customer, was
profitable in 2011 and reported record earnings for the Second Quarter 2012. On October 11, 2012 the
company announced the order of 50 new aircraft from Boeing. Together with 25 currently on-order, Alaska
now expects to acquire 75 new aircraft through 2022. Approximately 50 are for replacements and 25 for
growth.
IV-4
Port of Seattle
Aviation
2013 Budget and Business Plan
PASSENGER GROWTH ASSUMPTIONS
Enplaned passenger growth at Sea-Tac Airport in 2012 has been closely aligned with the budgeted growth rate
of 1.5%. This followed the unexpectedly high growth of 3.9% in 2011. Year-to-date traffic growth rates
through August show 1.4% for domestic and 5.8% for international for a combined growth rate of 1.8%.
International traffic continues to be a source of growth for Sea-Tac Airport. In 2012, Emirates began non-stop
service to Dubai, and ANA launched service to Tokyo. Also, Delta announced new service to Shanghai for
2013 and increased seats on its flight to Tokyo by up-gaging the aircraft to a 747. Delta also announced
increased service to New York (JFK).
The 2013 budget assumes growth of 2.2%, which is consistent with the long-term forecast for growth at SeaTac.
Enplaned passengers in 000s:
19,000
18,000
17,000
16,000
15,000
14,000
13,000
12,000
11,000
10,000
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
Year
Assumption
2012
1.5%
2013
2.2%
2014
2.2%
2015
2.2%
2016
2.2%
2017
2.2%
The strength and resiliency of the demand for air service at Sea-Tac is demonstrated by the relatively small
decrease in traffic (3%) and relatively quick recovery (3 years) experienced during the Great Recession. This
represents a smaller drop and a faster recovery than after 2001.
IV-5
Port of Seattle
Aviation
2013 Budget and Business Plan
AIRPORT COMPARISONS
When comparing airport costs, the most common measure is passenger airline cost per enplanement (“CPE”).
CPE is an average unit cost measure that permits a reasonable comparison among airports. It is not a “rate”
that is charged to any individual airline. CPE can be an imperfect measure because there are major differences
among airports for the costs that are included in the numerator of the equation. For example, at some airports,
airlines own and operate terminals. Thus, at those airports, the CPE would be artificially low. One of the
major drivers of increases to an airport’s CPE is the capital program. When assets are placed in service, the
debt service and the additional operating costs are charged to the airlines through rates designed to recover
costs. Consequently, airport CPEs tend to peak soon after a major capital program, then gradually decline as
passenger volume increases.
Airports that have strong origin and destination (“O&D”) traffic are less vulnerable to the financial problems
of any one carrier than a hub airport. The theory is that if one carrier disappears, the underlying demand for
travel will induce existing carriers to expand service or another carrier to enter the market.
SEA-TAC AIRPORT: BUSINESS ASSESSMENT
Sea-Tac was the sixteenth-largest US airport as measured by total passengers in 2011. As indicated above,
demand for air service proved to be very resilient during the Great Recession and the slow economic recovery
that has followed.
Sea-Tac has a relatively low concentration of service by the dominant carriers. The largest airline (Alaska)
accounted for 35.9% of the enplaned passengers in 2011, and the top three airlines (Alaska, Horizon, and
Delta) accounted for 61.5% of the passenger traffic. Compared to other large airports, Sea-Tac has relatively
high O&D traffic - approximately 72.7% in 2011. This percentage has declined very slightly since 2003.
Relatively high O&D traffic and relatively low concentration of dominant carriers reduces Sea-Tac’s
vulnerability to the effects of any given carrier reducing capacity or suffering financial difficulties. Only
Alaska Airlines uses Sea-Tac as a hub. Alaska’s relative financial strength compared to other airlines is a
positive factor for Sea-Tac.
By the end of 2012, Sea-Tac will have invested $3.9 billion in capital improvements since 1999. Investments
have included rebuilding Concourse A, the Satellite Transit System, the Central Terminal, constructing the
Third Runway, reconstructing Runway 16C, building a remote rental car facility and rebuilding much of the
airport’s infrastructure. The costs of these investments are reflected in higher rates and charges to the airlines
as reflected in the CPE.
Current and long-term cost management continues to be a strategic focus of Sea-Tac Airport. For 2011, the
most recent year for which comparable data is available, Sea-Tac’s CPE of $11.79 ranks 10th highest of the 26
large hub airports that participated in the ACI Benchmarking Survey. Among western airports (including
medium hubs), Sea-Tac’s CPE was below San Francisco, San Jose and Portland, just above Denver and Los
Angeles, and well above San Diego and Salt Lake City.
When aircraft operating costs (taxi time and delay costs) are included with CPE to generate a more
comprehensive cost comparison for airports, among a group of 22 peer airports (large hubs and Western U.S.
airports), Sea-Tac ranks 17th lowest. With this comparison, airport investments such as the $1 billion third
runway that contribute to higher CPE, are balanced with the benefits airlines derive (reduced operating costs).
This comprehensive cost comparison shows Sea-Tac to be a low-cost airport (within the bottom third of the 22
airports).
CHALLENGES AND OPPORTUNITIES
During the development of the business plan, senior staff conducted a SWOT analysis (strengths, weakness,
opportunities, threats). The highlights are presented below:
IV-6
Port of Seattle
Aviation
2013 Budget and Business Plan
Key Considerations:









Strong finances: O&D airport; cash flow/reserves; low competition.
Anticipate continued growth in international travel, especially Asia.
Cargo growth an opportunity.
Economic uncertainty remains: slow recovery in U.S., Europe.
Non-aeronautical NOI increasing, needed for future investments.
Major capital requirements: vertical circulation, North Satellite, South Satellite, FIS
upgrade/replacement.
Long-term throughput/efficiency/cost effectiveness of terminal investments; focus on technology.
Long-term planning issues: airport capacity, drives capacity, hotel, south access, cargo development,
off airport property development.
New airline agreement or no airline agreement – still discussing.
STRATEGIES/STRATEGIC GOALS AND OBJECTIVES
For each strategy, measurable objectives have been set for the 2013 – 2017 time-frame.
1.1 Operate a world-class international airport by ensuring safe and secure operations
A. Reduce wildlife strikes from 3.5 to 2.5 per 10,000 operations by 2016.
B. Comply with FAA Safety Management Systems requirements by 2014.
C. Reduce runway incursions by 30% by 2015 from 2010 baseline.
D. Increase airfield’s three runways’ availability during a snow event from 33% to 55% by 2013.
E. Maintain annual FAA Certification Inspection at zero discrepancies for 2013 – 2017.
F. Reduce pests in and around the Main Terminal area.
G. Maintain compliance with TSA regulations annual comprehensive TSA audit at 100% compliance
for 2013 – 2017.
1.2 Operate a world-class international airport by anticipating and meeting the needs of our tenants,
passengers and the region’s economy
A. Initiate a master plan study for airport capacity and development needs and complete by 2015.
B. Optimize air terminal utilization through incorporation of design flexibility and technology.
 Reconfigure ticket counter layouts and upgrade associated baggage systems by 2014.
 Optimize utilization of the terminal facility through planned relocation of non-airline
tenants to align highest and best use with availability of vacant space and anticipated
future function.
C. Renew North and South Satellite terminals by 2017 to satisfy evolving airline requirements.
D. Increase international arrivals operational efficiency. Improve and expand FIS facilities by 2017.
E. Maintain full utilization of runways, taxiways and apron areas and increase remain overnight
(RON) aircraft parking positions.
F. Improve and add facilities to meet ground transportation and public parking needs including
maximizing the capacity of the garage after the rental car companies vacate in 2012.
G. Increase total air cargo to 350,000 metric tons and international cargo to 136,000 metric tons by
2017.
H. Develop three new international routes by 2017 as a net gain in international service to Seattle
International Airport. Develop additional service in one existing market by 2017.
IV-7
Port of Seattle
Aviation
2013 Budget and Business Plan
1.3 Operate a world-class international airport by managing our assets to minimize the long-term total cost of
ownership
A. Develop an airport-wide Asset Management System by 2016 to minimize the total long-term cost
of ownership resulting in equivalent savings of $200,000 per year compared to pre-2010 average
baseline.
B. Achieve “the industry best in class standard” of 80% of maintenance work is proactively planned.
C. Establish aviation industry key system reliability metrics in order to identify improvement
opportunities and publish system availability results to key stakeholders.
D. Complete 75% of planned elevator/escalator refurbishments by 2016.
2.0 Become one of the top ten customer service airports in the world by 2015 (measured by the ACI ASQ
index)
A. Improve Sea-Tac’s ranking and score in ACI Airport Service Questionnaire survey results:
 Reduce wait times at passenger security checkpoints.
 Improve signage and way finding.
 Improve customer service process for arriving international passengers.
 Improve airport facilities.
B. Fast Travel: provide passengers with the latest automated processing systems, using terminal
development strategy to accommodate growth within existing terminal footprint.
C. Coordinate airport and seaport cruise activities to create a seamless passenger experience.
D. Ensure all airport actions are taken to prevent airline “tarmac” delays.
3.0 Lead the airport industry in environmental innovation and minimize the airport’s environmental impacts
A. Air Quality and Climate Change: 1) Sea-Tac will reduce airport owned and controlled greenhouse
gas emissions by 15% below 2005 levels by 2020, and 2) work with its business partners to
consolidate trips, reduce vehicle miles traveled, and promote clean vehicles from taxis, shuttles,
buses, construction vehicles, service equipment, and ground support equipment.
B. Energy and Conservation: 1) Implement conservation projects and practices that will enable it to
meet all future electricity load growth (estimated to be 10% through 2015) through conservation
measures and renewable energy; and 2) reduce natural gas consumption per square foot of
terminal (initiatives included under Strategic Goal 4.0).
C. Materials Use & Recycling: 1) Increase solid waste recycling rate to 50% by 2014, 2) Develop
goal for airfield recycling program by 2013.
D. Water conservation: Reduce operational (non-construction) potable water consumption rate per
enplanement below benchmark levels by 2016.
E. Water Resources: Establish a low-impact development (LID) program for off-airport properties
incorporating treatment, on-site retention, infiltration and water reuse concepts in a manner
consistent with wildlife hazard management and other Aviation operation limitations.
F. Education & Integration: Complete terminal environmental education pilot program by 2013 and
assess the effectiveness of the program; by 2013, incorporate best practices /opportunities to
advance environmental goals into lease and operating agreements.
4.0 Reduce airline costs (CPE) as far as possible without compromising operational and capital needs
A. Maintain CPE + airline operating costs within bottom third of peer airports (list of 22 airports
focusing on large hubs and Western U.S. airports) through 2017.
B. Maintain intermediate lien credit rating of A+ through 2017.
IV-8
Port of Seattle
Aviation
2013 Budget and Business Plan
C. Report annually on cumulative annual costs savings achieved through Continuous Process
Improvement initiatives and other cost savings initiatives.
D. Develop and implement system of performance metrics aligned with strategic goals by Q1 2013.
E. Implement conservation practices that will enable airport to meet all future electricity load growth
(2010 baseline) through conservation and renewable energy.
F. Develop and implement Energy Management system by 2015.
5.0 Maximize non-aeronautical net operating income (NOI) consistent with current contracts, appropriate use
of airport properties and market demand
A. Concessions: Grow concessions sales per enplanement by (SPE) to $11.82 by 2017.
B. Parking: Grow parking revenues by 4.3% CAGR through 2017 (parking revenues in 2017 = $64.9
million).
C. Real Estate: Grow annual revenues to reach $1.3 – $1.5 million by 2017.
D. Other revenues: Grow other non-aeronautical revenues by $1.5 million by 2017.
6.0 Continually invest in a culture of employee development, organizational improvement, and business
agility
A. Reduce the average time to fill an open Aviation position from 84 days to 76 days, 10% reduction.
B. Strengthen and expand the internal internship program from 17 to 20, or 5% growth.
C. Provide managers and employees training in high priority areas (e.g.,
presentations/communications, strategic thinking, and business case writing).
D. Achieve quality development plans 100% of the time for non-represented employees and
introduce performance and development plans for represented employees wherever possible.
E. Increase internal promotion/transfer rate from 65% to 68%, or 5%.
F. Address all of the FEMA exercise improvements by Q4 2013.
G. Create organizational tools and complete start-up phase in 2012 to facilitate an accelerating user of
Continuous Process Improvement (CPI) across the Port in 2013 and beyond.
H. Achieve a robust Division business intelligence (BI) production and distribution capability by the
end of 2013. Program elements include: 1) access to BI for all in the Aviation Division, 2) general
familiarity training for at least 100 users and specialized training for 50 data “power users,” and 3)
completion of at least eight new BI projects that increase employee efficiency, and provide new
and novel access to high-value data.
7.0 Develop valued community partnerships based on mutual understanding and socially responsible practices
A. Implement Commission and FAA approved FAR Part 150 recommendations within a time frame
to be determined after final approval are obtained.
B. Develop Port-owned properties and renew the Port/City of SeaTac Interlocal Agreement by 2016.
C. Increase by at least 4% Aviation Division goods and services contracts awarded to eligible small
businesses.
D. Maintain emphasis on the Port-wide effort to effectively communicate with limited-English
speaking community members.
E. In support of Port-wide workforce development strategies, continue successful educational support
programs and develop two additional programs by 2014.
IV-9
Port of Seattle
Aviation
2013 Budget and Business Plan
CAPITAL BUDGET
From 1999 to 2012, the Aviation Division has invested approximately $3.9 billion in capital improvements at
the airport. While the comparative average pace of spending will decline (after a rise in 2012), Aviation still
expects to invest $1.4 billion during the five year period from 2013-2017. 2012 will mark a high point due to
a few major projects that are in-process, including: Rental Car Facility, Escalator Replacement, PreConditioned Air, Electrical Ground Support Equipment infrastructure and charging stations, and elements of
the Terminal Realignment such as the acquisition of passenger loading bridges.
As a result of the 2013 budget process, 14 projects are proposed to be added to the capital program, bringing
the total number of projects to 117. These new projects total $184 million and have achieved Aviation
division approval as “business plan prospective.” This means additional design work is required to finalize the
scope, schedule, and budget associated with each project prior to requesting Commission authorization.
Links to Century Agenda:
Included in the capital budget are the following project that directly support the Century Agenda:
1. Triple air cargo volume to 750,000 metric tons:
 Cargo 2 facility improvements - $11.8 million
 Cargo 6 facility improvements - $6.4 million
2. Make Sea-Tac the west coast “Gateway of Choice” for international travel and double the number of
international flights and destinations:
 New FIS Facility - $495 million
3. Meet all increased energy needs through conservation and renewable sources:
 Stage 2 Mechanical Infrastructure Improvements - $2.9 million
 Parking Garage Emergency Lighting - $5.3 million
 Energy efficiency considered with every capital project. In particular, energy efficiency will be a
major focus for the renovation of the North and South Satellite renovation projects.
4. Reduce air pollutants and carbon emissions:
 Pre-Conditioned Air Project - $45.5 million
 Electrical Ground Service Infrastructure and Charging Stations - $30.2 million
IV-10
Port of Seattle
Aviation
2013 Budget and Business Plan
New Projects:
Description
Revised
Budget
2013
2014
3,500
800
1,500
850
$ 1,000
540
1,500
200
$ 1,650
494,900
5,000
5,600
350
22,900
4,100
151,400
500
8,200
3,000
2,000
2,200
2,000
2,000
1,928
1,000
1,000
1,500
4,200
900
1,000
900
300
200
3,000
2,000
500
400
1,000
1,700
1,728
600
$ 528,478
300
$ 13,490
$ 39,608
$158,750
$ 208,400
($ 000's)
Ensure Safe & Secure Operations
Security Exit Lane Breach Control - Phase 2
Known Crewmember & Employee Bypass
Access Control System Refresh
R&R of Emergency Power Trans Switches
Anticipating & Meeting Needs of Passengers & Tenants
FIS Long-Term
Main Term Mezzanine Tenant Relocations
Asset Management
Radio System Upgrade (800MHz)
Passenger Loading Bridges at B6, B8, B14
Passenger Loading Bridges at B7 and B9
Snow Blower and Deicer Trucks
Noise System Upgrade Replacement
Grease Interceptor Augment 2013
D Concourse Roof Replacement
Maximize Non-aeronautical NOI
Valet Parking Infrastructure
$
2015
$
2016
2017
750
Total 20132017
$
3,400
540
1,500
830
630
207,500
15,400
402,800
4,950
8,200
3,000
2,000
2,200
2,000
2,000
1,928
$ 15,400
300
$ 435,648
Descriptions of major projects:




Security Exit Lane Breach Control – Phase 2: Sea-Tac airport has five exits from the secure areas of
the terminal. These are all currently staffed by guards. Under an existing project, the Port will install
automated security exit lane breach control technology devices at one exit. If the project is successful,
similar devices will be installed for the other four exits under this project.
FIS Long-Term: This project, which will be the subject of a briefing to the commission in Q1 2013,
would replace the existing Federal Inspection Services facility (for international arrivals) in the South
Satellite with a new and expanded FIS facility to be located in the South ground transportation lot
adjoining Concourse A.
Main Term Mezzanine Tenant Relocations: There is currently a shortage of airline ticket office space
reasonably near the ticket counters. This project will create usable space where existing tenants could
be moved, thus freeing up space on the mezzanine level of the Main Terminal for airline tenants.
Radio System Upgrade: The Port’s 800MHz radio system is used by Police, Fire and other operations
and maintenance personnel. This project will upgrade critical infrastructure to maintain functionality
and to insure interoperability with other regional emergency radio systems in the Puget Sound area.
The capital projects are at various stages of approval with Port Commission. Projects, including the new
projects, have been organized in the following categories:
A.
B.
C.
D.
Commission authorized/underway
Pending 2012/2013 authorization
Pending future authorization
Small projects
IV-11
Port of Seattle
Aviation
2013 Budget and Business Plan
Summary by Category
($ 000's)
Category
A. Commission Authorized/Underway
B. Pending 2012 - 2013 Authorization
C. Pending Future Authorization
D. Small Projects
Total

Number of
Projects
64
40
8
5
117
2013
130,831
44,209
5,000
4,200
184,240
2014
143,977
112,217
10,550
4,200
270,944
2015
144,276
106,400
57,900
4,269
312,845
2016
77,121
227,350
147,110
3,188
454,769
2017
15,183
122,600
90,572
3,000
231,355
2013-17
511,388
612,776
311,132
18,857
1,454,153
Included in Category A are projects that have been partially but not fully authorized by the Port
Commission.
Commission Authorized/Underway:
Description
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
($ 000's)
2012
Estimate
NSAT Renovation
$ 1,025
Aircraft RON Parking USPS Site
1,275
Highline School Insulation
0
SSAT HVAC,Lights,Ceiling Repl
177
GSE Electrical Chrg Stations
6,810
Airfield Pavement Replacement
5,739
Community College Noise Insul.
1,504
Terminal Escalators Modn
13,223
Convert Ticket Zone 3 FlowThru
642
NS NorthSTAR Program
525
C60 - C61 BHS Modifications
207
Loading Bridges Utilities
459
Vertical Convey Modn Aero Ph1
539
Two New CTE Freight Elevators
542
Cent Plant Preconditioned Air
17,132
8th Floor Weather Proofing
3,405
Off Airport Parking Improvements
337
Other (47 Projects)
63,007
Total
$ 116,548
2013
$ 15,000
6,000
11,385
150
6,000
4,829
500
9,000
8,000
1,750
1,000
3,500
3,000
4,300
6,641
3,000
1,500
45,276
$ 130,831
2014
2015
2016
47,500
20,000
7,301
3,500
9,000
8,475
4,026
0
4,495
2,000
6,500
5,384
5,000
3,170
0
2,941
4,236
10,449
$ 143,977
$ 77,500
13,214
15,700
13,000
8,359
5,857
0
0
0
2,000
3,215
1,750
1,145
0
0
0
0
2,536
$ 144,276
$ 46,500
0
0
16,119
0
0
8,540
0
0
5,200
0
0
0
0
0
0
0
762
$ 77,121
$
2017
2013-17
6,775
0
0
0
0
0
0
3,639
0
1,525
0
0
0
0
0
0
0
3,244
$ 15,183
$ 193,275
39,214
34,386
32,769
23,359
19,161
13,066
12,639
12,495
12,475
10,715
10,634
9,145
7,470
6,641
5,941
5,736
62,267
$ 511,388
$
Descriptions of major projects:




NSAT Renovation: In collaboration with Alaska Airlines, the Port will renovate the North Satellite to
address seismic concerns, upgrade HAVAC and lighting, upgrade fixtures and reconfigure space to
add three gates. This project is included in the North STAR program, which will upgrade the North
Satellite, Concourse C and the Main Terminal at the North end.
Aircraft RON Parking USPS Site: At the USPS site, this project will develop needed overnight
parking positions for aircraft.
Highline School Insulation: This project is part of an ongoing program to provide noise insulation to
schools in the Highline School District.
SSAT HVAC, Lights Ceiling Repl.: This project will renovate or replace the HVAC, lighting and
ceilings at the South Satellite.
IV-12
Port of Seattle
Aviation



2013 Budget and Business Plan
GSE Electrical Charging Stations: This project will install electrical charging stations to permit
passenger airlines to charge electrical ground service equipment near all gates.
Airfield Pavement Replacement: This project provides the budget for annual replacement of the most
damaged airfield pavement. The scope each year is determined based on surveys.
Community College Noise Insulation: This project is part of an ongoing program to insulate up to 23
building for the Highline Community College.
Pending 2012/2013 Authorization:
Description
1
2
3
4
5
6
7
8
9
10
11
12
13
14
($ 000's)
2012
Estimate
FIS - Long Term Project
$
NS Main Terminal Improvements
Service Tunnel Renewal/Replace
NS Refurbish Baggage Systems
Vertical Convey Modn Aero Ph2
NS Conc C Vertical Circulation
Cargo 2 West Cargo Hardstand
Radio System Upgrade (800MHz)
Cargo 6 Enhancements
Parking Retrofit
Convert Ticket Zone 2 Pushback
MT Mezz Tenant Relocations
Facility Monitoring Sys Renewl
Other (27 Projects)
Total
$
300
164
163
501
10
14
40
50
83
2,257
3,582
2013
$
1,600
200
500
3,500
1,000
5,000
400
830
500
500
5,500
350
1,000
23,329
$ 44,209
2014
2015
2016
2017
2013-17
14,200
1,800
10,000
9,000
11,000
13,800
9,387
6,640
5,000
3,000
4,100
3,912
20,378
$ 112,217
$ 60,200
10,000
8,500
9,500
9,131
1,997
830
895
2,011
500
2,836
$ 106,400
$ 207,500
15,000
4,850
$ 227,350
$ 119,600
3,000
$ 122,600
$ 403,100
30,000
23,850
22,000
21,131
18,800
11,784
8,300
6,395
5,511
5,500
4,950
4,912
46,543
$ 612,776
$
Descriptions of major projects:






FIS – Long-Term: see description above under New Projects.
NS Main Terminal Improvements: This project will renovate the North end of the main terminal.
This project is included in the NorthSTAR program, which will upgrade the North Satellite,
Concourse C and the Main Terminal at the North end.
Service Tunnel Renewal and Replacement: This project will seismically upgrade the service tunnel.
NS Refurbish Baggage Systems: This project will refurbish the baggage systems that service the
North Satellite. This is part of the NorthSTAR program.
Vertical Conveyance Modernization Aero Phase 2: This project will modernize 3 elevators and
modernize 12 escalators.
NS Concourse C Vertical Circulation: This project will add elevators and enclosed walkways to
Concourse C at gates C2, C10/12 and C14.
IV-13
Port of Seattle
Aviation
2013 Budget and Business Plan
Pending Future Authorization:
Description
1
2
3
4
5
6
7
8
($ 000's)
2012
Estimate
2013
2014
RW 16C/34C Reconstruction
$
Utility ER Backup/Standby Pwr
Main Terminal HVAC Upgrades
Vert Convey Modn Non-Aero Ph1
Snow Blower and Deicer Trucks
Noise System Upgrade/Replace
Aeronautical Allowance
Non-Aeronautical Allowance
116
108
-
$
3,000
2,000
$
500
650
400
1,000
5,000
3,000
Total
224
$
5,000
$
10,550
$
2015
2016
2017
2013-17
1,000
5,000
1,000
2,000
900
1,000
30,000
17,000
$ 75,000
12,000
4,000
210
900
35,000
20,000
$ 13,221
13,132
3,378
40,000
20,841
$ 89,721
30,132
8,378
2,860
2,200
2,000
113,000
62,841
$ 57,900
$ 147,110
$ 90,572
$ 311,132
$
Descriptions of major projects:



Runway 16C/34C Reconstruction: This project will rebuild the center runway.
Utility Emergency Backup Power: Permanent Emergency Back-up Power is intended to allow the
airport to be fully operational in the event of a power outage. Sea-Tac is recognized as a valuable
regional asset in the event of a major emergency. Maintaining power is essential for operations.
Aeronautical and Non-Aeronautical Allowances: These “projects” are budget placeholders for as yet
undefined future projects. They are included in the capital budget to provide a more accurate
indication of likely future spending.
Small Projects:
Description
($ 000's)
Aviation Small Jobs
Aviation Small Jobs
AV/IT Small Capital Projects
Aviation Small Capital
Aviation Small Capital
2012
Estimate
$
$
2,416
748
1,074
4,238
2013
$
$
2,000
1,200
1,000
4,200
2014
$
$
IV-14
2,000
1,200
650
350
4,200
2015
$
$
1,200
869
1,200
1,000
4,269
2016
$
$
2,000
188
1,000
3,188
2017
$
$
2,000
1,000
3,000
2013-17
$
5,200
4,869
3,788
3,650
1,350
$ 18,857
Port of Seattle
Aviation
2013 Budget and Business Plan
Summary by Major Project/Program:
2013
Description
($ 000's)
FIS
$ 1,600
NorthSTAR
25,450
RW 16C/34C
Cargo/Airfield Pavement
11,729
Noise
12,896
All Other
132,565
Total
$ 184,240
2014
2015
2016
2017
Total 20132017
$ 14,200
74,100
500
42,862
12,003
127,279
$ 270,944
$ 60,200
99,000
1,000
21,963
15,700
114,982
$ 312,845
$ 207,500
66,700
75,000
8,540
97,029
$ 454,769
$ 119,600
11,300
13,221
87,234
$ 231,355
$ 403,100
276,550
89,721
76,554
49,139
559,089
$1,454,153
D. 2013 OPERATING BUDGET SUMMARY
Background
From a financial perspective, the Aviation Division has two sides of its business: Aeronautical and Nonaeronautical. On the Aeronautical side, where airline rates are set to recover costs, the Port’s goal is to manage
costs. The primary measure of an airport’s cost to the airlines is the airline cost per enplanement (CPE). The
“costs” include the operating and maintenance costs attributable to the airfield and the airline share of the
terminal operating and maintenance costs (based on the percentage of revenue producing space split between
airlines and other Port tenants), as well as the corresponding capital costs (either debt service or equity
amortization). The Port does not charge airlines for the capital costs of any asset funded by Passenger Facility
Charges (PFCs) or grants.
On the Non-aeronautical side of the business, the primary goal is to increase cash flow as measured by net
operating income (NOI). The net cash flow can be used to directly fund capital improvements and build up
cash reserves to meet liquidity targets.
Overview of Major Changes in 2013 Budget
The 2013 operating budget is largely driven by payroll and contractual increases, full year of rental car facility
and busing service, peak year spending for airline realignment and new initiatives tied to Century Agenda/
Airport strategies. The airline realignment involves a number of airline moves within the terminal to
accommodate merged airlines (Delta & Northwest; United and Continental; Southwest and Air Tran) and to
facilitate the consolidation of operations for Alaska Air Group (Alaska Airlines and Horizon) at Concourse C
and the North Satellite. The realignment involves both capital and operating costs. The Airport will incur
operating costs of approximately $16.0 million in 2013 for project oversight of tenant projects and to
reimburse airlines for moving costs.
Revenues
Operating revenues are budgeted to increase by $24.1 million or 6.3% compared to the 2012 budget, but
increase by $22.9 million over the 2012 forecast. Compared to the 2012 budget, 2013 airline revenues are
budgeted to increase by $13.6 million (5.7%), while non-airline revenues are budgeted to increase by $10.6
million (7.1%).
Airline revenues, in accordance with the terms of the Signatory Lease and Operating Agreement (SLOA), are
based on cost recovery. Costs in the rate base include both operating costs and capital costs (debt service and
asset amortization). Aeronautical rate base capital costs are increasing $3.4 million or 3.8% due to scheduled
start of principal payments of 2003B bonds $7.9M, capital interest of 2010B bonds exhausted in 2012 $2.7M
IV-15
Port of Seattle
Aviation
2013 Budget and Business Plan
and allocation from roadway CIPs $2.0M offset by refunding of bonds, used of reserve fund interest to offset
airfield debt service and lower variable rate interest. Aeronautical rate base operating costs are increasing by
$12.3 million, driven by increases relating to airline realignment of $7.8 million. Total aeronautical revenues
are budgeted to increase by $13.6 million.
Non-aeronautical revenues are budgeted to increase by $10.6 million over the 2012 budget due to increased
Customer Facility Charge revenues to pay for the operating costs associated with the RCF and related busing
operations and concession revenues.
Operating Expense Drivers
Total airport operating expenses (including Corporate costs and environmental remediation costs) are budgeted
to total $242.23 million. This represents a 7.6% increase compared to the 2012 budget. For the Aviation
Division alone, the 2013 budget is increasing by $15.8 million, or 9.8%. The following table shows the major
drivers of the increase. The RCF and Airline Realignment account for an increase of $9.6 million. Cost
increases for salary, wages and benefits and other contractual increases account for another $4.2 million.
Environmental remediation relating to capital projects accounts for another $1.5 million. These largely nondiscretionary items thus account for $15.3 million, or a 9.5% increase. The other net additions to the 2013
budget amount to $543 thousand or a 0.3% increase over 2012 budget.
Links to Century Agenda:
The 2013 Operating Budget includes staff resources that work on many elements of the Century Agenda. New
budget requests for 2013 that specifically support the Century Agenda include the following:
1. Make Sea-Tac the west coast “Gateway of Choice” for international travel and double the number of
international flights and destinations:
 Increase in 2013 to international incentive program for commitments to Emirates, ANA, and Delta
for new service in 2012 and 2013 - $469,000
2. Meet the region’s air transportation needs at Sea-Tac Airport for the next 25 years:
 Sustainability Master Plan - $1,750,000 in 2013, total of approximately $6.0 million.
3. Meet all increased energy needs through conservation
 Energy conservation balance technician (consultant) - $100,000
 Terminal lighting conservation projects - $100,000
IV-16
Port of Seattle
Aviation
2013 Budget and Business Plan
Aviation 2013 Budget Summary Compared to 2012 Budget:
2012 Budget
$000s
160,969
%
Cost increases (compensation, contractual)
Rental Car Facility & Busing
Increase in Airline Realignment
Increase in Regulated Materials
Subtotal
4,171
1,815
7,800
1,519
15,304
2.6%
1.1%
4.8%
0.9%
9.5%
Budget Requests
One-time items/savings
Subtotal
5,827
(5,284)
543
0.3%
Total increase
15,847
9.8%
2013 Budget
176,816
Operating and Maintenance Expense
Airline Realignment
Environmental Remediation
Grant Funded Operating Costs
Total Operating Expense



$000s
155,851
16,000
4,615
350
176,816
Each year, one-time expenditures funded by grants are excluded from the baseline budget. The
environmental liability expense relates to asbestos removal costs associated capital projects for North
Star $1M, Cargo 5 Hardstand contaminated soil $1M, vertical conveyance $740K, GSE Electrical
charge stations $350K, and MT So Low voltage Sys Upgrade $350K. Since the timing and amount is
driven by the capital budget, these costs are also excluded from the baseline budget.
The cost increases represent compensation and contractual increases.
Net savings includes 12.0 Terminal Access Controllers reductions and the elimination of one-time
items included in the 2012 budget.
The budget requests that total $5.8 million, and which are included in the net increase of $543K will be
presented by strategic driver, first in a summary, then in detail in subsequent tables.
IV-17
Port of Seattle
Aviation
2013 Budget and Business Plan
Summary of Budget Requests
New Requests:
$000s
Safe/Secure Airport
Customer Needs/Capacity
Asset Management
Total
404
2,219
175
2,798
Customer Service
Environmental Innovation
Airline Cost Management
Non-Aero Revenue Development
Costs offset by new revenues
Future revenue development costs
Employee Development
Community Partnerships
Total
289
270
200
570
1,180
157
145
2,811
Other
217
Total New Requests
5,826
Safe/Secure Airport
Description
Pest Control
SCBA Replacement
Tarmac Delay Monitor Description
Safety Risk Assessments
Emergency Management College Intern


$000s
215
130
39
15
5
404
Pest control contract will be able to treat previously unavailable areas within the Main Terminal.
SCBA (self-contained breathing apparatus) units for Fire Dept. will replace existing units that are
nearing the end of useful life, to be spread over 2 years.
Capacity and Customer Needs
Description
Sustainability Master Plan
Joint Marketing Fund

$000s
1,750
469
2,219
Master Plan and will integrate all new initiatives to increase efficiency and meet capacity needs,
$250K of which is grant funded by FAA.
IV-18
Port of Seattle
Aviation

2013 Budget and Business Plan
Joint marketing expenses and FTE in Air Service Development will contribute to attracting and
incentivizing new international service to Sea-Tac Airport. Joint marketing costs committed to
Emirates, ANA and Delta.
Asset Management
Description
Asset Management Estimator (Consultant)
CUSE/CUSS/FIMS Maintenance Materials

$000s
100
75
175
Consultant for asset management will minimize long term total costs of ownership.
Customer Service
Description
Kone Enhanced Escalator/Elevator Service
South Satellite Node Refurbishment
Music Initiative Development

$000s
254
20
15
289
Kone elevator/escalator service provides for repair staffing at five days per week as opposed to two
days per week under the standard contract.
Environmental Innovation
Description
Wetland Delineation
Greenhouse Gas Reporting

$000s
250
20
270
Wetland Re-Delineation and Greenhouse Gas Reporting items are regulatory requirements.
Airline Cost Management
Description
Energy Conservation Balance Technician (Consultant)
Terminal Lighting Conservation

$000s
100
100
200
Energy conservation projects will study and implement most efficient use of Sea-Tac power/lighting
systems.
IV-19
Port of Seattle
Aviation
2013 Budget and Business Plan
Non-aeronautical Revenue Development:
Description
Offset by New 2013 Revenues
Valet Management Contract
Search Engine Optimization
In-Terminal Advertising for Conference Center
Subtotal
$000s
525
36
9
570
Future Revenue Development Costs
Concessions Leasing Consultant
Land Development: Brokerage Fee
Land Development Planning
Parking Consultant Costs
Subtotal
800
200
120
60
1,180
Total Non-Aero Requests
1,750



Valet service should drive an additional $569K in revenue in 2013.
Concessions consultant to work on master plan for concessions post current lease cycle; aimed at
sustaining revenue generation and creating new concessions growth.
Real estate study and pre-development activities are necessary to prepare properties in the future for
potential revenue generation in coming years.
Employee/Organizational Improvement
Description
Continuous Process Improvement Consultant
Host for 2013 Western Region Property Managers Conference
Planning Graduate Intern Hourly Rate increase
Internal Intern program

$000s
140
10
4
3
157
CPI initiative already in motion; intended to maximize productivity of Port staff time by streamlining
processes.
Community Partnerships
Description
Part 150 Noise Compatibilty Study
28th Ave Development
Community Development High School Intern

$000s
125
15
5
145
Part 150 implementation shall conclude in 2013; $87K of costs are grant funded.
IV-20
Port of Seattle
Aviation
2013 Budget and Business Plan
Other New Initiatives
Description
Land Appraisals
Maintenance Uniform dry cleaning increase
Landside Parking Audit Assistant
Landside Ops Assistant Manager
Miscellaneous Support Services (Appraisals, Survey, Title Work)
Building Dept (Office equipment, ICC eCodes subscription)

$000s
120
40
30
2
20
5
217
Landside Parking Audit Assistant and Landside Operations Assistant Manager positions are repurposing of funded and vacant FTEs within the Operations department; the amount in the request
reflects the net change in budget.
Aeronautical Summary
For the 2013 budget, aeronautical target was established with a 3.0% growth for operating and maintenance
expenses excluding airline realignment, regulated materials tied to capital projects, and grant funded items.
Aeronautical Target
$ in 000's
Airport Costs
Utilities Internal Billing
Utilities Other
Total Airport Costs
Corporate Direct Charges & Allocations
Captial Development and Other
Total Corporate and other Divisions
Total Aeronautical before Exceptions
Airline Realignment
Regulated Materials
Aero Operating Costs net Non-aero



2012
Budget
2013
Budget
2013 / 2012
Budget Chg
$
%
86,717
17,052
122
103,892
89,290
15,021
123
104,434
2,573
3.0%
(2,031) -11.9%
0
0.3%
542
0.5%
31,696
5,669
37,365
32,447
6,456
38,903
751
787
1,538
2.4%
13.9%
4.1%
141,257
143,337
2,080
1.5%
8,200
2,072
16,000
3,555
7,800
1,484
95.1%
71.6%
151,529
162,893
11,364
7.5%
Airport costs increased by 3.0% for the 2013 budget compares to the 2012 budget.
Utilities for 2013 budget accounted for surplus from 2011 backup power.
Excluding these savings, total Aeronautical costs before exception is up 3.0%.
IV-21
Port of Seattle
Aviation
2013 Budget and Business Plan
Aeronautical Business
$ in 000's
Operating Costs
Baseline
Airline Realignment
Regulated Materials
Total Operating Costs
Capital Costs
Debt service on new assets
Existing debt service
Total Debt Service
2011
Actual
2012
Budget
2012
Forecast
2013
Budget
2013/2012
Budget Chg
$ 131,959 $ 141,257 $ 143,297 $ 143,337 $
8,200
5,400
16,000
1,124
2,072
3,154
3,555
133,083
151,529
151,851
162,892
%
2,080
7,800
1,484
11,363
1.5%
95.1%
71.6%
7.5%
81,507
81,507
3,997
87,879
91,876
3,997
85,876
89,873
2,632
92,699
95,331
(1,365)
4,820
3,454
-34.2%
5.5%
3.8%
Total Costs
214,590
243,405
241,724
258,223
14,818
6.1%
Other
FIS Offset
Other revenues
Other net costs
Total Other Costs
(7,000)
15,590
(15,417)
(6,827)
(8,000)
15,711
(14,895)
(7,184)
(8,000)
15,742
(14,461)
(6,719)
(8,000)
14,721
(15,467)
(8,745)
(989)
(571)
(1,561)
0.0%
-6.3%
3.8%
21.7%
Total Aero Revenues
Less: Non-passenger Airline Costs
Net Passenger Airline Costs
207,763
236,221
235,005
249,478
14,944
192,819
15,390
220,831
15,421
219,584
15,003
234,474
13,257
(387)
13,644
5.6%
-2.5%
6.2%
Highlights:
 Airline revenues are based on cost-recovery formulas.
 Capital costs increased $3.5M due to scheduled start of principal payments of 2003B bonds ($7.9M),
capital interest of 2010B bonds exhausted in 2012 ($2.7M) and allocation from roadway CIPs ($2.0M)
offset by refunding of bonds, use of reserve fund interest to offset airfield debt service and lower
variable rate interest.
 Operating costs excluding airline realignment increased $3.6M due to payroll baseline increases,
sustainability master plan and environmental remediation liability.
 Airline realignment increased by $7.8M.
 Maintaining FIS offset at $8M.
IV-22
Port of Seattle
Aviation
2013 Budget and Business Plan
Aeronautical Key Measures
2011
Actual
Cost Per Enplanement:
Capital Costs / Enpl
Operating Costs / Enpl
Airline Realignment / Enpl
FIS/Other Offsets
Other Aero Revenues
Non-passenger Airline Costs
Passenger Airline CPE


4.97
8.12
(1.37)
0.95
(0.91)
11.76
2012
Budget
5.52
8.61
0.49
(1.38)
0.94
(0.92)
13.26
2012
Forecast
5.40
8.80
0.32
(1.35)
0.95
(0.93)
13.19
2013
Budget
2013 / 2012 Budget Chg
$
%
5.62
8.63
0.94
(1.38)
0.87
(0.88)
13.80
0.10
0.02
0.45
(0.00)
(0.08)
0.04
1.9%
0.3%
90.9%
0.3%
-8.3%
-4.6%
0.54
4.0%
Airline realignment increase of $7.8M had incremental impact on CPE of $0.45.
(Regulated Materials increase of $1.5M had incremental impact on CPE of $0.09.
Non-Aeronautical Summary
Targets are tied to financial goals. For the 2013 budget, Non-Aeronautical financial goal is to grow net
operating income excluding surplus of CFC operating revenues over CFC funded operating expenses.
Non-Airline Budget Target
2012
Budget
$ in 000's
2013
Budget
2013/2012 Budget
Change
$
%
Non-Aero Revenue
CFC Operating Revenue (CFC)
Total Non-Aeronautical Revenue
140,955
8,576
149,531
149,110
11,013
160,123
8,155
2,437
10,592
5.8%
28.4%
7.1%
Baseline Non-Aero Operating Expense (AV)
Internal Utility Billing (AV)
Other Utilities Expenses (AV)
Regulated Materials
Non-Aero Operating Expense (Corporate)
Non-Aero Operating Expense (CDD/RE/SP)
RCF Operating Expenses (CFC)
Non-Aero Requests Driven by New Revenue
Non-Aero Requests Driven by Future Revenues
Allocation of Division-Wide Requests to Non-Aero
Total Non-Aero Operating Expense
37,625
(16,501)
16,731
1,025
20,974
6,226
7,469
73,549
38,261
(14,470)
17,247
1,060
21,758
4,934
7,439
570
1,180
1,355
79,335
636
2,031
516
35
784
(1,292)
(30)
570
1,180
1,355
5,785
1.7%
-12.3%
3.1%
3.4%
3.7%
-20.7%
-0.4%
n/a
n/a
n/a
7.9%
Non-Aeronautical Net Operating Income
75,982
80,788
4,807
6.3%
Adjusted NOI:
Non-Aeronautical Net Operating Income
Less CFC Surplus
Adjusted Non-Aero Net Operating Income
75,982
(1,107)
74,875
80,788
(3,464)
77,324
4,807
(2,357)
2,450
6.3%
212.9%
3.3%
IV-23
Port of Seattle
Aviation
2013 Budget and Business Plan
Non-Airline Business
$ in 000's
Revenues:
Rental Cars
CFC Operating Revenues (RCF)
RCF Reimbursable Revenue
RCF Subtotal
Public Parking
Ground Transportation
Concessions
Other
Total Non-Airline Revenues
2011
2012
2012
2013
Actual
Budget
Forecast
Budget
2013 / 2012 Budget Chg
$
%
29,969
778
30,746
49,996
7,704
35,404
19,109
142,959
26,580
8,576
477
35,633
52,480
7,519
35,659
18,240
149,531
28,359
7,083
477
35,919
51,512
7,419
37,107
18,974
150,930
26,737
11,013
1,486
39,236
53,744
7,267
40,763
19,113
160,123
157
2,437
1,009
3,602
1,264
(252)
5,104
873
10,592
0.6%
28.4%
211.4%
10.1%
2.4%
-3.4%
14.3%
4.8%
7.1%
RCF Operating Expense
Other Operating Expense
852
58,692
8,150
66,490
6,858
65,366
9,121
68,523
972
2,033
11.9%
3.1%
Share of terminal O&M
Less utility internal billing
17,610
(18,369)
18,698
(19,789)
18,686
(19,789)
18,793
(17,102)
94
2,686
0.5%
-13.6%
Net Operating & Maint
58,786
73,549
71,122
79,335
5,785
7.9%
Net Operating Income
84,173
75,982
79,808
80,788
4,806
6.3%
Highlights:





Public Parking revenues increase due to new valet parking to begin services in July and anticipated
growth in 1-4 Day and 4+ Day parking transactions.
Concession revenues increase due to continued growth in concessions revenue performance in retail,
in-flight kitchen, food and beverage plus addition of new tenants and a new duty free operator.
Rental Car Facility (RCF) operating expenses increase due to full year of operations.
Other operating costs increase due to payroll baseline increases, outside service contractual increases
and environmental remediation liability.
Internal utilities for 2013 budget account for surplus from 2011 backup power.
Non-Airline Key Indicators
2011
Actual
Revenues Per Enplanement
Parking
Rental Cars (excludes CFCs)
CFC Operating Revenues (RCF) & RCF Reimbursable
Ground Transportation
Concessions
Other
Total Revenues
Primary Concessions Sales / Enpl
2012
Budget
2012
Forecast
2013
Budget
3.05
1.83
0.05
0.47
2.16
1.17
8.72
3.15
1.60
0.54
0.45
2.14
1.10
8.98
3.09
1.70
0.45
0.45
2.23
1.14
9.06
3.16
1.57
0.73
0.43
2.40
1.12
9.41
10.30
10.42
10.60
11.25
IV-24
2013 / 2012 Budget Chg
$
%
0.01
(0.03)
0.19
(0.02)
0.25
0.03
0.43
0.2%
-1.6%
35.1%
-5.4%
11.9%
2.5%
4.8%
0.83
8.0%
Port of Seattle
Aviation
2013 Budget and Business Plan
Highlights:
 Concessions 2012 forecast is higher than budget due to growth in performance of retail, in-flight
kitchen, and food and beverage.
 Primary concessions sales are comprised of Food & Beverages and Retail & Duty Free revenues.
Concession revenues consist of food & beverages, retail & duty-free, advertisement, space rental, and
in-flight kitchen, and other smaller accounts.
 Ground transportation 2013 revenues are lower than 2012 budget due to rental cars and Doug Fox
operators who will no longer pay per-trip fees for courtesy vans.
Traffic
Passenger traffic measured by enplaned passengers is projected to grow 2.2% in 2013 for a total of 17,017
million enplanements which is consistent with long-term growth forecast. Through August 2012, total
enplaned passengers are up 1.8% compared to 2011.
Landed weight is budgeted to be flat for the 2013 budget compared to the 2012 budget. Through August 2012,
total landed weight is down 1% compared to the 2011 budget. Since passenger carriers have been operating
with exceptionally high load factors, growth in passenger levels will likely require increased capacity and
landed weight.
Sensitivity of Financial Results to Changes in Enplanements
Based on the assumptions in the 2013 budget, a 1.0% increase or decrease in enplaned passengers will
generate a change in non-aeronautical net operating income of $950K, and a change in debt service coverage
of 0.01x. There will also be a change in CPE of $0.13.
Full-Time Equivalent Staff Positions (FTEs)
The 2013 budget proposes a decrease of 13.2 FTEs, or 1.5% due to a reduction of 12 Access Controllers and
4.0 Customer Service Pathfinders.
FTEs
2012 Approved Budget
Customer Service Pathfinders
Senior Planner
Airport Office Building On-call Receptionist
On-call Concessions Marketing Coordinator
Other
2012 Baseline
2013 Budget Changes:
AF Security Terminal Access Controllers
Five Vacant 0.2 Tour Group Coordinator FTEs
Landside Ops Assistant Manager
Vacant Parking Cashier
Landside Parking Audit Assistant
Community Partnership High School Intern
Emergency Management College Intern
Subtotal
2013 Budget Proposed FTEs
%
860.02
(4.00)
1.00
0.12
0.20
0.75
858.09
(12.00)
(1.00)
1.00
(1.00)
1.00
0.33
0.33
(11.34)
846.75
IV-25
-1.3%
Port of Seattle
Aviation
2013 Budget and Business Plan
FTEs
900
Total 858
Total 847
850
Total 774
800
86
87
14
750
700
650
600
775
782
792
2007
2008
775
782
746
760
772
760
2009
2010
2011
14
2012
86
2013
87
792
746
760
772
760
550
500
450
400
RCF FTEs
Base FTEs
Base FTEs
RCF FTEs
The table above shows the trends of FTEs for the Aviation division. The 2013 total FTEs is at a 2009 level
when 90.00 positions were eliminated.
IV-26
Port of Seattle
Aviation
2013 Budget and Business Plan
OPERATING BUDGET SUMMARY
TABLE IV-4: REVENUE BY ACCOUNT
($ in 000's)
Revenue by Account
Operating Revenue
Equipment Rental
Landing Fees
Airport Transportation Fees
Parking Revenue
Revenue from Sale of Utilities
Property Rental Revenue
Other Revenues
Total Operating Revenue
Notes
2011
Actual
2012
Budget
2013
Budget
$1,009
59,607
7,553
53,014
7,079
197,827
24,571
$350,659
$831
70,198
7,459
55,584
6,175
211,060
34,445
$385,751
$1,009
69,444
7,188
53,971
6,291
233,469
36,252
$407,625
% Change
2013 Bud2012 Bud
21.4%
-1.1%
-3.6%
-2.9%
1.9%
10.6%
5.2%
5.7%
avbud.xls
FIGURE IV-3: AVIATION DIVISION REVENUE BY ACCOUNT
Equipment Rental
0.2%
Other Revenues
8.9%
Landing Fees
17.0%
Airport Transportation
Fees
1.8%
Parking Revenue
13.2%
Property Rental Revenue
57.3%
Revenue from Sale of
Utilities
1.5%
Total Revenue: $407,625
IV-27
Port of Seattle
Aviation
2013 Budget and Business Plan
TABLE IV-5: OPERATING & MAINTANENCE EXPENSES BY ACCOUNT
(in 000's)
2011
Actual
$80,839
4,059
13,202
4,928
25,224
898
512
6,003
2012
Budget
$95,015
2,472
12,458
4,425
37,404
1,558
727
7,052
2013
Budget
$98,829
2,655
12,425
4,284
45,453
1,675
895
9,126
% Change
2013 Bud2012 Bud
4.0%
7.4%
-0.3%
-3.2%
21.5%
7.5%
23.1%
29.4%
135,664
161,112
175,342
8.8%
Environmental Remediation Liability
Total O&M with Environmental
1,428
137,092
3,096
164,208
4,615
179,957
49.0%
9.6%
Charges to Capital/Govt/Envrs Projects
Total Operating Expense
(1,480)
135,612
(3,239)
160,969
(3,666)
176,291
13.2%
9.5%
Expense by Account
Salaries, Wages, Benefits & Worker's Comp
Equipment Expense
Utilities
Supplies & Stock
Outside Services
Travel & Other Employee Expenses
Promotional Expenses
Other Expenses
Notes
Total O&M without Environmental
1
avbud.xls
Note:
1) Tables IV-4, 5 & 6 differ from Table IV-2, in that they only reflect the division expenses and do not
include corporate allocations.
FIGURE IV-4: AVIATION DIVISION EXPENSE BY ACCOUNT
($ in 000’s)
Other Expenses
5.0%
Promotional Expenses
0.5%
Travel & Other
Employee Expenses
0.9%
Outside Services
25.3%
Environmental
Remediation Liability
2.6%
Salaries, Wages, Benefits &
Worker's Comp
54.8%
Utilities
6.9%
Supplies & Stock
2.4%
Equipment
Expense
1.5%
Total Before Charges to Capital/Govt/Envrs Projects: $179,957
Charges to Capital/Govt/Envrs Projects: $3,666
Total Expense: $176,291
IV-28
Port of Seattle
Aviation
2013 Budget and Business Plan
TABLE IV-6: REVENUE AND EXPENSE BY BUSINESS GROUP/DEPARTMENT
AVIATION DIVISION
(in 000's)
Notes
2011
Actual
2012
Budget
2013
Budget
% Change
2013 Bud 2012 Bud
OPERATING REVENUES
AIRLINE REVENUES
Landing Fees
Terminal Rents
Other Airline Revenues
Total Airline Revenues
59,607
132,576
15,579
207,763
70,198
150,312
15,711
236,221
69,444
165,633
14,721
249,799
-1.1%
10.2%
-6.3%
5.7%
NON-AIRLINE REVENUES
Public Parking
Rental Cars excluding RCF
CFC Operating Revenues (RCF)
RCF Reimbursable Revenues
Employee Parking
Ground Transportation
Commercial Properties
Concessions
Utilities
Other
Total Non-Airline Revenues
50,027
29,969
778
5,232
7,662
5,112
34,636
7,694
1,624
142,733
52,480
26,580
8,576
477
5,211
7,519
4,972
34,924
6,803
1,989
149,531
50,948
26,737
11,013
1,486
5,523
7,267
5,536
40,528
6,871
1,917
157,826
-2.9%
0.6%
28.4%
211.4%
6.0%
-3.4%
11.4%
16.0%
1.0%
-3.6%
5.5%
Total Operating Revenues
350,495
385,751
407,625
5.7%
BDAVRVEX.xls
IV-29
Port of Seattle
Aviation
2013 Budget and Business Plan
AVIATION DIVISION
(in 000's)
Notes
2011
Actual
2012
Budget
2013
Budget
% Change
2013 Bud 2012 Bud
EXPENSES BEFORE CHARGES TO CAP/GOVT/ENVRS PROJECTS
BUSINESS UNITS
Airport Operations
Airport Operations excluding Airline Realignment
Airline Realignment
Business Dev & Management
Utilities
Business Units
AVIATION SERVICES
Aviation Director's Office
Division Contingency
Fire Department
Aviation Planning
Aviation Finance & Budget
Community Partnerships
Airport Security
Aviation Services
AVIATION FACILITIES
AV Facilities & Infrastructure
Aviation Signage
Airport Building Department
Airport Office Building
AV Environmental Programs Group
Aviation Maintenance
Aviation Facilities
Aviation Risks Expense
Aviation Environmental Remediation Liability
Aviation Capital to Expense
Total Expenses Before Charges to Cap/Govt/Envrs Projects
1
2
3
4
5
6
7
8
CHARGES TO CAPITAL/GOVT /ENVRS PROJECTS
33,400
33,400
4,367
15,133
52,900
49,539
41,339
8,200
5,464
12,923
67,926
59,474
43,474
16,000
6,073
13,214
78,760
20.1%
5.2%
95.1%
11.1%
2.3%
15.9%
1,388
31
12,766
2,109
716
1,479
6,051
24,540
2,304
2,087
11,926
1,898
864
1,590
6,254
26,924
1,548
2,087
12,367
3,282
834
1,387
6,387
27,890
-32.8%
0.0%
3.7%
72.9%
-3.6%
-12.8%
2.1%
3.6%
1,963
558
670
1,155
3,564
50,043
57,953
2,334
458
689
1,210
3,939
55,837
64,466
2,342
489
703
1,504
4,082
57,794
66,915
0.3%
6.9%
2.0%
24.4%
3.7%
3.5%
3.8%
1,428
272
137,092
1,796
3,096
164,208
1,777
4,615
179,957
-1.0%
49.0%
n/a
9.6%
(1,480)
(3,239)
(3,666)
13.2%
BUSINESS UNITS
Airport Operations excluding Airline Realignment
Airline Realignment
Business Dev & Mgmt
Utilities
Business Units
33,303
4,365
15,133
52,801
40,168
8,200
5,464
12,923
66,755
42,026
16,000
6,073
13,214
77,312
4.6%
95.1%
11.1%
2.3%
15.8%
AVIATION SERVICES
Aviation Director's Office
Division Contingency
Fire Department
Aviation Planning
Aviation Finance & Budget
Community Development
Airport Security
Aviation Services
1,388
31
12,600
2,109
716
1,415
6,044
24,304
1,804
2,087
11,749
1,898
864
1,499
6,254
26,155
1,548
2,087
12,185
3,282
834
1,293
6,387
27,615
-14.2%
0.0%
3.7%
72.9%
-3.6%
-13.7%
2.1%
5.6%
AVIATION FACILITIES
AV Facilities & Infrastructure
Aviation Signage
Airport Building Department
Airport Office Building
AV Environmental Programs Group
Aviation Maintenance
Aviation Facilities
1,566
539
332
1,155
3,418
49,729
56,739
1,884
458
389
1,210
3,847
55,379
63,166
1,882
489
402
1,504
3,887
56,807
64,972
-0.1%
6.9%
3.1%
24.4%
1.1%
2.6%
2.9%
Aviation Operating & Maintenance Expense
133,844
156,076
169,899
8.9%
Aviation Risks Expense
Aviation Environmental Remediation Liability
Aviation Capital to Expense
Total Operating Expense
1,428
341
135,612
1,796
3,096
160,969
1,777
4,615
176,291
-1.0%
49.0%
n/a
9.5%
OPERATING & MAINTENANCE EXPENSE
BDAVRVEX.xls
Notes:
1) Concessions Leasing and Planning Personal consulting services increased to $800k from $300k in 2013.
2) 4.12 FTEs transferred to AOB in 2012 after 2012 budget approved.
3) Sustainability Master Plan $1.5M in 2013.
4) Part 150 and other noise consulting decreased in 2013.
5) 12.0 FTE Terminal Access Controllers eliminated in 2013.
6) 4.12 FTEs transferred from ADO in 2012 after 2012 budget approved
7) 30.0 new FTEs added in 2012 budget for approx. 8.3 months now budgeted for full year in 2013 plus 3.0% prep/contractual increases.
8) Environmental remediation expense driven by capital projects for North Star $1M, Cargo 5 Hardstand contaminated soil $1M,
Vertical Conveyance $740K, GSE Electrical charge stations $350K, MT So Low Voltage Sys Upgrade $350K.
IV-30
Port of Seattle
Aviation
2013 Budget and Business Plan
E. STAFFING
Table IV-7 outlines the full-time equivalents (FTEs) adjusted for temporary positions, interns and other limited
duration employees for the Aviation division. Aviation is budgeting 846.80 FTEs, which is 1.5 percent less
than 2012 budget.
TABLE IV-7: AVIATION DIVISION STAFFING
STAFFING
(Full-Time Equivalent Positions)
BUSINESS GROUP/DEPARTMENT
AIRPORT OPERATIONS
Aeronautical Business Group
Landside Business Group
Airport Operations
Notes
2012
Budget
2012
Est. Act.
2013
Budget
% Change
2013 Bud 2012 Bud
108.0
86.5
194.5
110.0
136.5
246.5
106.8
136.5
243.3
106.8
136.5
243.3
-3.0%
0.0%
-1.3%
9.0
6.0
3.0
2.0
0.0
20.0
9.5
6.0
3.3
2.0
1.0
21.8
9.5
6.2
3.3
2.0
1.0
22.0
9.5
6.2
3.3
2.0
2.0
23.0
0.0%
3.3%
0.0%
0.0%
100.0%
5.5%
10.1
76.0
9.0
6.0
15.4
10.0
74.0
10.1
76.0
9.0
6.0
15.7
10.0
74.0
6.0
76.0
10.0
6.0
15.7
10.0
74.0
6.0
76.0
10.0
6.0
15.7
10.3
62.3
-40.7%
0.0%
11.1%
0.0%
0.0%
3.3%
-15.8%
Total Aviation Services
200.5
200.8
197.7
186.3
-7.2%
FACILITIES
Facilities & Infrastructure
AV Signage
Airport Building Department
Airport Office Building
Maintenance
Total Facilities
14.0
3.0
5.0
6.0
331.0
359.0
15.0
4.0
5.0
6.0
361.0
391.0
15.0
4.0
5.0
10.2
361.0
395.2
14.0
4.0
5.0
10.2
361.0
394.2
-6.7%
0.0%
0.0%
70.7%
0.0%
0.8%
774.0
860.0
858.1
846.8
BUSINESS DEVELOPMENT
Aviation Properties
Concession
Business Development
Business Management
Utilities
Business Development
AVIATION SERVICES
Airport Director's Office
Fire Department
Planning
Aviation Finance & Budget
Environmental
Community Development
Airport Security
TOTAL AVIATION DIVISION
1
2
2011
Actual
3
4
5
6
7
4
-1.5%
FTE.XLS
Notes:
1) 2012 Estimated Actual includes a net reduction of 3.25 FTEs including 4 Pathfinders.
2) 2013 Budget includes the elimination of five vacant .2 FTE Tour Group Coordinators and 1 Vacant Parking
Cashier and the addition of a Landside Ops Assistant Manager and a Landside Parking Audit Assistant.
3) 2012 Estimated Actual includes the addition of a .2 On-Call Concessions Marketing Coordinator.
4) 2012 Estimated Actual includes a transfer of 4.12 Administrative Assistants from Aviation Director's Office
to Aviation Office Building and a .12 On-Call Receptionist was added to Aviation Office Building.
5) 2012 Estimated Actual includes approval of 1 Sr. Planner.
6) 2013 Budget includes the addition of a .33 High School Intern.
7) 2013 Budget includes the elimination of 12 Access Controllers and the addition of a .33 College Intern.
IV-31
Port of Seattle
Aviation
2013 Budget and Business Plan
F. CAPITAL BUDGET
The business plan summaries at the beginning of this section provide the context for the following capital
budget for the Aviation Division.
Table V-8 provides a Summary of the Aviation Approved Capital Budget for 2013.
TABLE IV-8: AVIATION CAPITAL BUDGET SUMMARY
($ in 000's)
2013
Budget
Committed Capital Projects
Airfield
Business Development
Landside
Air Terminal
Infrastructure
Stormwater
Airfield Security
Aviation NOISE
Division-wide Projects
Total Committed
$25,187
2,725
9,306
64,557
23,434
0
2,833
12,896
10,255
$151,193
$108,787
5,772
16,697
318,075
75,504
2,262
2,833
49,139
17,802
$596,871
Business Plan Prospective Projects
$33,047
$857,282
$184,240
$1,454,153
Total CIP
% of 2013 Total
Committed
2013-2017
CIP
16.7%
1.8%
6.2%
42.7%
15.5%
0.0%
1.9%
8.5%
6.8%
100.0%
capsum.xls
FIGURE IV-5: AVIATION DIVISION COMMITTED CAPITAL BUDGET
($ 000’s)
Airfield Security
1.9%
Stormwater
0.0%
Aviation NOISE Division-wide Projects
Landside
5.5%
6.8%
6.2%
Airfield
16.7%
Business Development
1.8%
Infrastructure
15.5%
Air Terminal
42.7%
Committed CIP Total Spending: $151,193
IV-32
Port of Seattle
Aviation
2013 Budget and Business Plan
G. AVIATION DIVISION OPERATING STATISTICS
TABLE IV-9: AVIATION DIVISION OPERATING STATISTICS
Year
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012 Budget
2012 Forecast
2013 Budget
(1)
Enplaned
Passengers
Number Growth
13,802
14,174
13,506
13,362
13,356
14,364
14,632
14,982
15,661
16,085
15,610
15,773
16,397
16,650
16,650
17,017
Compound Growth
2001 - 2011
2006 - 2011
31.8%
2.7%
-4.7%
-1.1%
0.0%
7.6%
1.9%
2.4%
4.5%
2.7%
-3.0%
1.0%
4.0%
1.5%
1.5%
2.2%
(2)
Total
Landed Weight
Pounds Growth
23,078
23,051
22,178
21,658
20,790
20,944
20,186
20,362
21,014
21,519
20,388
19,786
20,123
20,443
20,443
20,443
2.0%
1.8%
24.8%
-0.1%
-3.8%
-2.3%
-4.0%
0.74%
-3.6%
0.9%
3.2%
2.4%
-5.3%
-3.0%
1.7%
1.6%
1.6%
0.0%
-1.0%
-0.2%
(3)
Air Cargo
Metric tons Growth
444,224
456,920
401,535
374,753
351,418
347,517
338,591
341,981
319,013
290,205
270,142
283,425
279,625
289,094
283,200
293,115
8.3%
2.9%
-12.1%
-6.7%
-6.2%
-1.1%
-2.6%
1.0%
-6.7%
-9.0%
-6.9%
4.9%
-1.3%
3.4%
1.3%
3.5%
-3.6%
-3.9%
Notes:
1) Passengers in thousands
2) Weight in thousands
3) In Metric Tons
AVSTAT.XLS
IV-33
This page was intentionally left blank.
IV-34
Port of Seattle
Seaport
2013 Budget and Business Plan
SEAPORT DIVISION
A. 2013 BUDGET SUMMARY
TABLE V-1: 2013 CASH FLOW SUMMARY
2013
($ in 000's)
SOURCES OF CASH
Operating Revenues
Interest Receipts
Proceeds from Bond Issues
Grants and Capital Contributions
Tax Levy
Other Receipts
Total
$
USES OF CASH
Expenses from Operations:
Operating & Maintenance Expense
Corporate Administrative Expense
Law Enforcement Costs
Environmental Expenditures
Total Operating Expenses
110,283
2,073
1,138
40,349
510
154,353
71.4%
1.3%
0.0%
0.7%
26.1%
0.3%
100%
47,043
19.6%
9.3%
3.0%
0.8%
32.7%
75,592
18.8%
33.7%
52.5%
5,723
2,501
13,047
143,906
4.0%
1.7%
9.1%
100%
28,250
13,358
4,265
1,170
Debt Service:
Interest Payments
Bond Redemptions
Total Debt Service
27,105
48,487
Other Expenses
Public Expense
Capital Expenditures
Total
$
Percent
of Total
Cashflw.xls SP
V-1
Port of Seattle
Seaport
2013 Budget and Business Plan
FIGURE V-1: SOURCES OF CASH
($ in 000’s)
Other Receipts
0.3%
Tax Levy
26.1%
Grants and
Capital
Contributions
0.7%
Operating Revenues
71.4%
Interest Receipts
1.3%
Total Sources: $154,353
FIGURE V-2: USES OF CASH
($ in 000’s)
Public Expense
1.7%
Other Expenses
4.0%
Capital
Expenditures
9.1%
Operating &
Maintenance
Expense
19.6%
Corporate
Administrative
Expense
9.3%
Law Enforcement
Costs
3.0%
Bond
Redemptions
33.7%
Interest Payments
18.8%
Environmental
Expenditures
0.8%
Total Uses: $143,906
V-2
Port of Seattle
Seaport
2013 Budget and Business Plan
B. BUSINESS PLAN FORECAST
TABLE V-2: BUSINESS PLAN FORECAST
($ in 000's)
Budget
2013
2014
$ 98,578
98,578
$ 110,283
110,283
$ 124,964
124,964
$ 126,309
126,309
$ 124,011
124,011
$ 133,243
133,243
6.2%
6.2%
29,078
13,291
4,167
0
46,536
28,250
13,358
4,265
1,170
47,043
29,592
13,959
4,457
0
48,008
27,429
14,587
4,658
0
46,674
31,095
15,244
4,867
0
51,206
30,093
15,930
5,086
0
51,109
0.7%
3.7%
4.1%
1.9%
52,042
63,240
76,956
79,635
72,804
82,134
9.6%
Total Depreciation Expense
Net Operating Income After Depreciation
31,713
$ 20,330
35,022
$ 28,218
Committed Capital Budget
Business Plan Prospective
TOTAL CAPITAL BUDGET
$ 25,706
4,868
$ 30,574
$ 11,547
1,500
$ 13,047
OPERATING BUDGET
Notes
Operating Revenue
Total Operating Revenues
Operating & Maintenance Expense
Corporate & Capital Development Division Costs
Law Enforcement Costs
Environmental Expense
Total Operating & Maintenance Expenses
1
Net Operating Income Before Depreciation
2
$ 25,885
36,200
$ 62,085
Forecast
2015
2016
Compound
Growth
2012 - 2017
Budget
2012
$ 15,075
90,980
$ 106,055
$
1,800
43,700
$ 45,500
2017
Total
2013 - 2017
$ 1,200 $ 55,507
67,850
240,230
$ 69,050 $ 295,737
mabpfor.xls
Notes:
1) Consists of remaining Corporate & Capital Development costs to be allocated to Business Groups after direct charges have been
coded to groups and Divisions or other costs allocated to Divisions. Most costs are allocated using a formula based on Expenses
and employees. For some departments specific allocation methodologies, such as employees for Human Resources & Development,
are used.
2) See Section X for details of Capital Budget.
C. SEAPORT DIVISION BUSINESS PLAN
MISSION:
The Port of Seattle Seaport Division promotes regional economic vitality by:
 Growing the volumes of cargo freight and passengers moving through the Port’s terminals;
 Championing the region’s fishing industry;
 Creating/facilitating a healthy business environment for maritime trade;
 Generating sufficient net operating income to be financially self-sustaining; and,
 Being a model of environmental sustainability for our industry and the region.
VISION:
A vibrant working waterfront creating economic vitality for the region
STRATEGIES/STRATEGIC GOALS:
 Grow the volumes of cargo freight and passengers moving through the Port’s terminals while
maximizing the Seaport’s net operating income (NOI) by: (Commercial Strategy)
o Growing the Seaport’s business;
o Maintaining financial independence;
o Building public and community support.

Being the global leader among seaports in demonstrating environmental stewardship and reducing
the environmental impact of our operations (Green Gateway Strategy)
o Meeting local state and federal regulations as effectively and efficiently as possible;
V-3
Port of Seattle
Seaport
o
o

2013 Budget and Business Plan
Collaborating with industry to reduce environmental impacts while enhancing our competitive
advantage;
Engaging stakeholders to build understanding and support for environmental initiatives.
Maintain existing assets and invest in new developments to sustain and enhance Seaport vitality
(Asset Stewardship Strategy)
o Understanding existing assets;
o Managing existing assets in a financially sustainable manner;
o Aligning asset investments to support long-term market demand.
DESCRIPTION:
The Seaport includes two major business groups: Lease & Asset Management and Cruise & Maritime
Operations. There are also service groups within the Seaport Division including Commercial Strategy,
Environmental Services & Planning, and Finance. These businesses and service groups oversee the marketing,
strategic development, and management of cargo and cruise terminals, moorage facilities, and other industrial
properties connected to these businesses.
Seaport facilities encompass approximately 1,200 acres of moorage and cargo-related facilities. Over 500
acres are dedicated to container operations at four terminals with over12,300 feet of container berth space
and 30 cargo cranesincluding thirteen Super Post-Panamax cranes. The Seaport also owns a fully automated
grain terminal and general purpose maritime facilities. It is home to the North Pacific factory trawler fishing
fleet. The Seaport also operates two cruise vessel terminals with a total of three berths. In addition, the Seaport
leases industrial property connected with these cruise, cargo, and factory trawler fishing businesses.
PARTNERSHIPS:
We would not be able to fulfill our mission without positive relationships with our partners. We are focused
on:
 Meeting the needs of our customers by:
o Maintaining regular contact with our key customers to stay in touch with their needs and identify
opportunities to increase business through port facilities;
o Working with stakeholders to constantly improve freight mobility within the seaport;
o Facilitating customer relationships with federal inspection agencies;
o Developing new business opportunities for our customers; and
o Providing market information to support our tenants’ interest in expansion.
 Approaching our relationship with labor honestly and with integrity, communicating effectively, and
working together under a fair labor agreement.
 Respecting tribal sovereignty, and tribal religious and cultural values in all consultations with our tribal
neighbors.
V-4
Port of Seattle
Seaport
2013 Budget and Business Plan
2013 STRATEGIES AND OBJECTIVES
STRATEGY: COMMERCIAL STRATEGY– Grow the volumes of cargo freight and passengers
moving through the Port’s terminals while maximizing the Seaport’s net operating income (NOI)
Objective: Grow the Seaport’s Business
 Execute long term lease extension at Terminal 46.
 Execute new long term leases with existing tenants at Terminals 108, 91 and 103.
 Seek revenue opportunities for vacant Seaport properties Terminals 10 and 25 South.
 Reach long term agreements with homeport cruise lines not currently under long term agreements.
 Market concept of short NW cruise itineraries (3 and 4 day) to cruiselines.
 Market Port’s commercial vessel moorage facilities to gain additional business at Terminal 91, Pier 69
and North Harbor Island mooring dolphins.
 Seek opportunities to increase non-container cargoes using 3rd party stevedoring and joint marketing.
 Seek opportunities to increase container volume through relationships with ocean carriers, beneficial
cargo owners & logistics providers, terminal operators and railroads.
 Actively promote our Foreign Trade Zone (FTZ).
 Promote regional exports.
Objective: Maintain Financial Independence
$63.2 Million Net Operating Income (NOI) reached by 12/31/2013. In 2013, each business group will
contribute to total Seaport NOI as budgeted:
 Lease & Asset Management
NOI = $59.3 Million
 Cruise & Maritime Operations
NOI = $5.1 Million
 Environmental Remediation Liability NOI = ($1.2) Million
Reduce costs and increase efficiencies in cruise and Seaport maritime operations.
Objective: Build public and community support
 Facilitate a comprehensive construction traffic management approach among city and state projects that
maintains the functionality of the Port’s drayage routes.
 Development of truck heavy haul corridor as part of the City’s overall freight plan.
STRATEGY: GREEN GATEWAY STRATEGY– Be the global leader among Seaports in
demonstrating environmental stewardship and reducing the environmental impact of our operations
Objective: Meet local state and federal regulations as effectively and efficiently as possible
 Efficiently obtain environmental permits, including both project permits and programmatic permits for
routine activities.
 Manage and implement a stormwater management program.
 Clean up properties consistent with State and Federal requirements.
Objective: Collaborate with industry to reduce environmental impacts while enhancing our competitive
advantage


Seek funding sources for shorepower at Pier 66 cruise vessel berth.
Implement the Northwest Ports Clean Air strategy and support the Century Agenda Goal to reduce
emissions while growing cargo and cruise business.
V-5
Port of Seattle
Seaport

2013 Budget and Business Plan
Market Port of Seattle’s Green Gateway brand advantages to beneficial cargo owners, ocean carriers and
other cargo routing decision makers.
Objective: Engage stakeholders to build understanding and support for environmental initiatives
 Engage industry stakeholders and fenceline communities in discussions of our Environmental Programs.
 Continue to refine Environmental metrics and use as decision making and communication tools.
STRATEGY: ASSET STEWARDSHIP STRATEGY –Maintain existing assets and invest in new
developments to sustain and enhance seaport vitality
Objective: Understand existing assets
 Administer a concise 20-year plan to inspect and maintain major docks.
 Administer a concise 20-year plan to inspect and maintain yard and building systems (>$250K) at major
terminals.
 Produce berth surveys that are timely, accurate and useful to Pilots for navigation.
Objective: Manage existing assets in a financially sustainable manner
 Coordinate Port/tenant maintenance activities.
 Complete crane audit inspections and document reviews.
Objective: Align asset investments to support long-term market demand
 Commence work on Terminal 46 dock rehabilitation project.
 Begin work to dredge Terminal 5 north berth and high spots and high spots at Terminal 18.
 Implement plan to maintain/improve tracks at Terminal 91 and Terminal 115.
 Complete final procurement and delivery of new cruise ship breasting barges for Terminal 91.
V-6
Port of Seattle
Seaport
2013 Budget and Business Plan
SEAPORT LEASE & ASSET MANAGEMENT
MISSION:
Negotiate and manage Seaport leases and manage assets to support the Port’s overall goals and maintain a
sustainable Seaport.
DESCRIPTION:
The major leases managed by this group include the container terminals at Terminal 5, Terminal 18, Terminal
30, Terminal 46 and Terminal 115; the grain facility at Terminal 86; and leases to support the fishing industry
primarily at Terminal 91. The group also manages other industrial leases that support Seaport terminals and
operations.
Besides lease management, this team is also developing and will maintain an asset management system to
track condition and projected investments in all Seaport assets. This team also coordinates Seaport traffic
issues and cooperates with regional transportation planning.
STRATEGY:
Lease Management: Manage and lease the container terminals portfolio and enhance the value of the
managed assets by increasing revenue and reducing expenses.
By effectively focusing on our customers, we can better understand how to meet their needs in a competitive
and cost effective manner. Activities such as gathering and disseminating market, industry and community
information, communicating with both customers and influencers, investing in future infrastructure, and
conducting industry forums all serve to support shipping operations in the PNW.
As cargo volumes grow, we are also focused on trying to manage the impacts from that growth and anticipate
future issues to allow for efficient growth to continue. As we move into the future, continued focus on
technology issues at the terminals will help our port continue to be efficient.
Asset Management: Through a number of major capital projects, the Seaport has enhanced its assets over the
years. Now the focus is to develop and maintain a more comprehensive program of managing for the long
term sustainability of the asset portfolio to the benefit of the Port mission and goals.
We partner with our customers to ensure that their facilities, which are Port assets, are properly maintained to
both preserve their value and help our customers to maximize their cargo throughput. We will focus on
providing customer value through building and maintaining relationships with our key customers, and striving
to understand and anticipate their needs.
KEY STRATEGIES AND OBJECTIVES
STRATEGY: COMMERCIAL STRATEGY- Grow the volumes of cargo freight and passengers
moving through the Port’s terminals while maximizing the Seaport’s net operating income (NOI)
Objective: Grow the Seaport’s business
Performance Measure
Performance Target
Actions
Long term lease
extension for Terminal 46
Lease extension executed
by end of Q2 2013
Negotiate lease extension
Revenue generated from
Terminal 10, Terminal 25
South, Terminal 5CFS
Revenue generated by end
of Q4 2013
Seek revenue opportunities for vacant Seaport
properties
V-7
Port of Seattle
Seaport
Long term leases
executed and approved
by Commission with
existing tenants at
Terminals 108, 91 and
103
2013 Budget and Business Plan




Lease with ConGlobal
at T108
Lease with American
Seafoods at T91
Lease with Marel at
building C-175 at T91
Lease with General
Construction at T103
Negotiate new leases with tenants by end of
2013
Long term lease executed
and approved by
Commission for the T115
card lock facililty
Lease with new tenant in
place by end of Q4 2013
Negotiate agreement
Lease extended with
Commercial Fence at
T115
Lease with Commercial
Fence in place by end of Q4
2013
Negotiate agreement
Street vacation and
property transfers related
to past expansion projects
Transactions for Terminal 5
and Terminal 18 at least
50% complete
Work with City on street vacation issues
Communication of
construction related
traffic impact to Port
stakeholders
Port stakeholders report
they get the information
they need
Work with Commercial Strategy and Cruise
staff to communicate construction related traffic
impact to Port stakeholders via:
 Written materials
 Regular meeting
 Ad-hoc briefings
Objective: Maintain financial independence
Lease & Asset
Management Net
Operating Income
$59.3 million by 12/31/2013
Objective: Build public and community support
Performance Measure
Performance Target
Actions
Functionality of the
Port’s drayage routes
Partner staff integrates Port
comments into planning
efforts to the extent possible
by end of Q1 2013
Facilitate a comprehensive construction traffic
management approach among City and State
projects that maintains the functionality of the
Port’s drayage routes through:
 Regular participation in MOT meetings;
 Review of and comments on traffic control
plans;
 Field assessments;
 Check-ins with Port stakeholders; and
 Communcation of issues
V-8
Port of Seattle
Seaport
Truck heavy haul
corridor included as part
of City’s overall freight
plan
2013 Budget and Business Plan
City of Seattle approves the
truck heavy haul corridor by
end of Q4 2013
Work with City to develop a plan to implement
a heavy haul corridor
STRATEGY: GREEN GATEWAY STRATEGY – Be the global leader among Seaports in
Demonstrating Environmental Stewardship and Reducing the Environmental Impact of our Operations
Objective: Collaborate with industry to reduce environmental impacts while enhancing our
competitive advantage
Performance Measure
Performance Target
Actions
RFID implementation –
Metrics to monitor truck
hotline for trucker
outreach
Metrics implemented by
end of Q4 2013
Implementation of metrics
Terminal 18 access
improvements
Construction authorized by
end of Q3 2013
Acquire grant funding to support project
Energy audits at
container terminals
Audits complete by end of
Q4 2013
Support implementation and completion of
audits
Tenant participation in
ECAP program
Tenants participate in
ECAP program by end of
Q4 2013
Support tenant participation in ECAP program
per Environmental Service’s plan to resolve
tenant compliance issues
STRATEGY: ASSET STEWARDSHIP STRATEGY – Maintain Existing Assets and Invest in New
Developments to Sustain and Enhance Seaport Vitality
Objective: Understand existing assets
Performance Measure
Performance Target
Actions
Administer a concise 20year plan to inspect and
maintain major docks
Plan in place by end of Q2
2013
Consolidate findings from dock condition
assessments into an ongoing asset stewardship
plan
Administer a concise 20year plan to inspect and
maintain yard and
building systems
(>$250K) at major
terminals
Plan in place by end of Q3
2013
Consolidate findings from Maintenance, Risk,
and supplemental fieldwork into a list of major
repairs/upgrades sorted by Port and tenant
responsibility
Berth surveys that are
timely, accurate and
useful to Pilots for
Navigation

Perform ongoing bathymetric surveys of berths
in partnership with NOAA and USACE in
formats consistent with other PNW container
ports


Port lead-line surveys
completed by Q1 2013
USACE/NOAA/Port
contour surveys
completed by Q2 2013
Annual charts updated
by Q4 2013.
V-9
Port of Seattle
Seaport
Program to maintain
berths at or below design
depth at minimal cost
2013 Budget and Business Plan
Program developed by end
of Q1 2013
Complete berth surveys and get programatic
permit for maintenance dredging
Objective: Manage existing assets in a financially sustainable manner
Completion of crane
audit inspections and
related review
documentation
Completed annually for all
Port owned cranes
Perform crane audit inspections and document
reviews on time
Maintenance activities
performed in accordance
with lease obligations
100% compliance
Coordinate Port/tenant maintenance activities
Tenants in compliance
with lease terms
100% compliance
Address lease compliance issues including use,
insurance, security, crane billing audit and
compliance
Objective: Align asset investments to support long-term market demand
Work underway on
Terminal 46 dock
rehabilitation program
Work on project has started
by end of Q3 2013
Authorize and start design and bid document
preparation
Work underway to
dredge Teminal 5 north
berth and high spots and
Terminal 18 high spots
Work on project has started
by end of Q4 2013
Complete first phase of dredging and contract
for second phase
Track maintenance and/or
improvements at
Terminals 91 and 115
Design work complete and
contractor procured by end
of Q4 2013
Initiate and complete design work.
Procure contractor
V-10
Port of Seattle
Seaport
2013 Budget and Business Plan
TABLE V-3: LEASE & ASSET MANAGEMENT BUSINESS PLAN FORECAST
($ in 000's)
OPERATING BUDGET
Notes
Operating Revenue
Operating & Maintenance Expense
Corporate Administrative Expense
1
Total Operating Expense
Net Operating Income Before Depreciation
Total Depreciation Expense
Net Operating Income After Depreciation
COMMITTED CAPITAL BUDGET
2
Budget
2013
2014
$ 81,309
$ 92,872
$ 106,362
$ 107,147
$ 105,173
$ 113,603
6.9%
19,533
13,001
32,534
48,775
20,406
13,177
33,583
59,289
21,777
13,770
35,547
70,815
19,353
14,390
33,743
73,404
20,483
15,038
35,521
69,652
21,976
15,714
37,691
75,912
2.4%
3.9%
3.0%
9.3%
22,672
$ 26,103
25,903
$ 33,386
$ 19,981
$
5,529
$ 23,469
Forecast
2015
2016
Compound
Growth
2012 - 2017
Budget
2012
$ 13,850
$
350
2017
$
Total
2013 - 2017
- $
43,198
mabpfor.xls
Notes:
1) Consists of remaining Corporate costs to be allocated to Business Groups after direct charges have been coded to Groups
and Divisions or other costs allocated to Divisions. Most costs are allocated using a formula based on Expenses and
employees. For some departments specific allocation methodologies, such as employees for Human Resources & Development,
are used.
2) See Section X for details of Capital Budget - does not include business plan prospective projects.
V-11
Port of Seattle
Seaport
2013 Budget and Business Plan
CRUISE & MARITIME OPERATIONS
MISSION:
Provide safe, secure and efficient cruise ship terminals and cargo handling maritime facilities which include
large vessel berthing docks for moorage, working apron areas and related equipment, cruise passenger
terminals, utilities and services to encourage current and new customers to move greater amounts of marine
tonnage and cruise passengers through the Port of Seattle. Market and provide cruise ship services and
facilities that maintain and grow the cruise business in the Seattle area. These facilities and services will
enhance the economy of the region, protect jobs and provide a reasonable rate of return to the Port of Seattle
and the citizens of King County while advancing the Port’s Century Agenda Goals.
DESCRIPTION:
Cruise & Maritime Operations is made up of multiple deep water commercial moorage facilities in and around
the harbor with over 17,000 lineal feet of large vessel berth moorage and two cruise passenger terminals.
Maritime Facilities include: T91 piers 90 and 91, T46 North; plus vessel berths at P2, P17, 18N, P25, P28,
P34, P69, and other maritime facilities. The two cruise terminals include a single cruise vessel berth facility at
Pier 66, the Bell Street Pier Cruise Terminal, and a two berth facility at Terminal 91, the Smith Cove Cruise
Terminal.
Customers include cruise lines, cruise terminal operator, charter and excursion vessels, tug and barge
companies, large fishing and commercial vessels, the United States Navy and other ships of state. Industry
sectors served include cruise, marine transportation, staging and transport, stevedoring service providers, the
commercial seafood industry, bunker and distillate fuel distribution, and tug and barge services.
STRATEGY:
Additional review of our Seaport resources in 2013 will confirm any further refinement needed of our
organizational structure in order to accomplish our collective Port goals and objectives in the area of Maritime
Operations, Maritime Business Development, Seaport Security and Emergency Preparedness.
Cruise: For the cruise business, our strategy is to market Seattle as a homeport and a port of call to cruise lines
serving Alaska and the Pacific Northwest. Through this, we will maintain our market share, increase cruise
passenger volumes and annual number of ship calls. We also create value for our customers by making our
cruise terminals more efficient and cost effective; working with the Airport and logistic providers along with
our terminal operator to improve the operations and passenger experience at the Seaport and Airport; and
working with the tourism and business community so that we maximize economic impact from visiting
passengers and cruise ships.
Maritime Operations: For docks/commercial moorage facilities, we work with the terminal operators,
tugboat, fishing industry, stevedoring companies, vessel agents and other dock users to maximize the use of
vessel berthing and dock facilities providing net income to the port. We focus on providing customer value
through building and maintaining relationships with our key customers, and continually strive to better
understand and anticipate their business needs. Retaining our current customers across all maritime sectors
continues to be a key focus. We also invest in strategic capital improvements to maintain and improve
facilities, accommodate current customers’ needs, attract new business, and enhance revenue opportunities
from our facilities.
Focus for the coming year will be on retaining customers and growing core business, asset stewardship-annual maintenance procedures and condition monitoring, advancing capital improvement programs that align
with competing Seaport priorities, completing projects underway and expanding our green gateway strategy.
This will include continued pursuit of establishing cruise ship shore power facilities at P66, indentifying storm
water improvements needed at T91 along with seeking energy efficiencies and reducing operating costs
through use of new technology in energy efficient yard lighting and security equipment.
V-12
Port of Seattle
Seaport
2013 Budget and Business Plan
Security and Emergency Preparedness: The focus on security issues for the seaport will be to maintain
compliance with regulations and policy and to enhance business through identifying potential security
technologies to improve the efficiency of our Port and customer operations and to minimize costs where
possible through the effective use of any available grants. For 2013 close collaboration with Airport Division
will continue as we further advance Ports commitment to emergency preparedness.
KEY STRATEGIES AND OBJECTIVES
STRATEGY: COMMERCIAL STRATEGY- Grow the volumes of cargo freight and passengers
moving through the Port’s terminals while maximizing the Seaport’s net operating income (NOI)
Objective: Grow the Seaport’s business
Performance Measure
Performance Target
Actions
Long term agreement
with homeport cruise
lines currently under
yearly berth request
Cruise line commitment for
multi-year agreement by
end of Q4 2013
Seek additional long term agreements
Presentations made to
cruise line executives and
itinerary planners for
short NW cruise
itineraries (3 and 4 day)
Presentations made by end
of Q4 2013
In collaboration and cost sharing with other NW
and BC ports make marketing calls to cruise
lines to promote NW cruises (interporting
concept)
Gain additional business
at Port’s commercial
vessel moorage facilities,
T91, P69 and North
Harbor Island Mooring
Dolphins

Execute marketing plan
New non-container
cargos for Port operated
facilities
New business activity for
port operated facilities
secured by Q4 2013. Break
Bulk

Increase utilization
from 2012
New vessel types using
facilities
Objective: Maintain financial independence
Cruise & Maritime
Operations 2013 Net
Operating Income
$5.1 million by 12/31/2013
V-13
Focus specific staff resources on opportunities
to increase non-container cargos using 3rd party
stevedoring and joint marketing.
Port of Seattle
Seaport
2013 Budget and Business Plan
STRATEGY: GREEN GATEWAY STRATEGY – Be the global leader among Seaports in
Demonstrating Environmental Stewardship and Reducing the Environmental Impact of our Operations
Objective: Collaborate with industry to reduce environmental impacts while enhancing our
competitive advantage
Performance Measure
Performance Target
Actions
Funding sources/partners
for Pier 66 shorepower at
cruise vessel berth
Funding sources/partners
secured for P66 shorepower
and continued Commission
support for project
Collaborate with Seattle City Light in seeking
funding opportunities
Seek commitment from homeport cruise line
served at Pier 66 to invest in and utilize
shorepower
STRATEGY: ASSET STEWARDSHIP STRATEGY – Maintain Existing Assets and Invest in New
Developments to Sustain and Enhance Seaport Vitality
Objective: Manage existing assets in a financially sustainable manner
Performance Measure
Performance Target
Actions
Required maintenance
performed
Required maintenance
performed within schedule
and budget by end of Q4
2013
Objective: Align asset investments to support long-term market demand
New cruise ship breasting
barges in-service at
SCCT
New breasting barges
deployed for 2013 cruise
season
Final procurement completed and breasting
barges delivered
2013 Approved Capital
projects completed
Complete 2013 capital
projects as defined in
project schedules
Design, permits and construction
STRATEGY: SEAPORT SECURITY AND EMERGENCY PREPARENESS
Objective: 100% compliance with federal mandates for security at Seaport facilities as effectively and
efficiently as possible
Performance Measure
Performance Target
Actions
Meet federal mandates
for security measures
No violations
notices/penalties


Efficiency of security
operations
New technologies identified
and/or implemented to
improve efficiency
V-14


Maintain full compliance with approved
Security Plan and pass all USCG
Inspections
Conduct training and perform regular
exercises on regular schedules throughout
the year
Identify new technologies that will improve
the efficiency of security operations
Identify grant opportunities that align with
Seaport operational needs
Port of Seattle
Seaport
Maintain working
relationship with U.S.
Coast Guard and ensure
Port interests and
business continuity is
considered before
security/safety measures
are implemented
2013 Budget and Business Plan
Meetings scheduled and
attended by appropriate
level of staff and Executive
team
Security/safety measures
implemented do not impact
the continuity of Port
business


Hold regular meetings with USCG to share
information, advance mutual goals, and
address opportunities to increase maritime
commerce in our harbor
Active participation in the U.S. Coast Guard
Area Maritime Committee (AMSC) and
Harbor Safety Committee (HSC)
Objective: Emergency Preparedness Manage Seaport, Real Estate, Corporate and CDD (nonaviation divisions) Emergency Preparedness Program
Performance Measure
Performance Target
Actions
Status of Emergency
Operation Program

Manage Seaport and all other non-aviation
divisions’ Emergency Preaparedness Program
(EPP) portwide

Emergency Operations
Program fully adopted
in all divisions with no
operational or policy
conflicts
All COOP plans
updated annually and
maintained
V-15
Port of Seattle
Seaport
2013 Budget and Business Plan
TABLE V-4: CRUISE & MARITIME OPERATIONS BUSINESS PLAN FORECAST
($ in 000's)
OPERATING BUDGET
Budget
2012
Notes
Operating Revenue
$
Operating & Maintenance Expense
Corporate Administrative Expense
1
Total Operating Expense
Net Operating Income Before Depreciation
Total Depreciation Expense
Net Operating Income After Depreciation
COMMITTED CAPITAL BUDGET
$
2
$
Budget
2013
Forecast
2014
2015
2016
2017
Compound
Growth
2012 - 2017
17,269 $
17,411 $
18,602 $
19,162 $
18,838 $
19,640
2.6%
9,545
4,457
14,002
3,267
7,844
4,446
12,290
5,121
7,815
4,646
12,461
6,141
8,076
4,855
12,931
6,231
10,612
5,073
15,685
3,153
8,116
5,302
13,418
6,222
-3.2%
3.5%
-0.8%
13.8%
9,041
(5,773) $
9,119
(3,998)
3,855 $
4,303 $
983 $
200 $
200 $
Total
2013 - 2017
200 $
5,886
mabpfor.xls
Notes:
1) Consists of remaining Corporate costs to be allocated to Business Groups after direct charges have been coded to Groups and Divisions
or other costs allocated to Divisions. Most costs are allocated using a formula based on Expenses and employees. For some departments,
specific allocation methodologies, such as employees for Human Resources & Development, are used.
2) See Section X for details of Capital Budget - does not include business plan prospective projects.
V-16
Port of Seattle
Seaport
2013 Budget and Business Plan
D. SEAPORT OPERATING BUDGET SUMMARY
TABLE V-5: REVENUE BY ACCOUNT
(in 000's)
REVENUE BY ACCOUNT
Operating Revenue
Dckg, Whrfg, Serv/Facility, Passenger Fee
Equipment Rental
Berthage & Moorage
Revenue From Sale of Utilities
Property Rental Revenue
Other Revenues
Total Operating Revenue
2011
Actual
Notes
$
1
$
2,961
10,130
822
3,842
80,073
833
98,661
2012
Budget
$
$
3,327
7,465
373
4,475
80,222
2,289
98,151
2013
Budget
$
2,909
7,933
1,264
4,891
92,320
552
$ 109,869
% Change
2013 Bud 2012 Bud
-12.6%
6.3%
238.9%
9.3%
15.1%
-75.9%
11.9%
marbud.xls mardata
Notes:
1) Revenue does not include allocations from other divisions.
FIGURE V-3: SEAPORT DIVISION REVENUE BY ACCOUNT
($ in 000’s)
Dckg, Whrfg,
Serv/Facility, Passenger Equipment Rental
Fee
7.2%
Other Revenues
2.6%
Berthage & Moorage
0.5%
1.2%
Revenue From Sale of
Utilities
4.5%
Property Rental Revenue
84.0%
Total Revenue: $109,869
V-17
Port of Seattle
Seaport
2013 Budget and Business Plan
TABLE V-6: OPERATING AND MAINTENANCE EXPENSES BY ACCOUNT
($ in 000's)
2011
Actual
Notes
EXPENSE BY ACCOUNT
Salaries, Wages, Benefits & Workers Comp
Equipment Expense
Utilities
Supplies & Stock
Outside Services
Travel & Other Employee Expenses
Promotional Expenses
Other Expenses
Total O&M without Environmental
$
Environmental Expense
Total O&M with Environmental
Charges to Capital/Govt/Envrs Projects
Total Budgeted Operating Expense
1
$
7,433
73
4,615
31
3,707
416
112
1,962
18,347
2012
Budget
$
7,848
176
5,014
37
5,141
749
205
2,757
21,929
2013
Budget
$
% Change
2013 Bud 2012 Bud
8,073
54
5,751
46
4,293
682
220
1,473
20,591
2.9%
-69.3%
14.7%
24.3%
-16.5%
-8.9%
7.3%
-46.6%
-6.1%
(633)
17,715
21,929
1,170
21,761
-0.8%
(1,620)
16,095 $
(1,521)
20,408 $
(1,263)
20,498
-17.0%
0.4%
marbud.xls mardata
Notes:
1) Tables V-5, 6 & 7 differ from Table V-2, in that they only reflect the division expenses and do not
include corporate allocations.
FIGURE V-4: SEAPORT DIVISION EXPENSE BY ACCOUNT
($ in 000’s)
Promotional
Environmental Expense
Expenses
5.4%
0.9%
Travel &
Other Employee
Expenses
3.4%
Other Expenses
6.8%
Salaries, Wages, Benefits
& Workers Comp
37.1%
Outside Services
19.7%
Utilities
26.4%
Supplies & Stock
0.2%
Equipment Expense
0.2%
Total Before Charges to Capital /Govt/Envrs Projects: $21,761
Charges to Capital/Govt/Envrs Projects: $1,263
Total Expense: $20,498
V-18
Port of Seattle
Seaport
2013 Budget and Business Plan
TABLE V-7: SEAPORT REVENUE AND EXPENSE BY BUSINESS GROUP/DEPARTMENT
($ in 000's)
BY BUSINESS GROUP/DEPARTMENT
REVENUE
Lease and Asset Management
Cruise and Maritime Operations
Security Grants
Total Operating Revenue
EXPENSES BEFORE CHARGES TO CAP/GOVT/ENVRS PROJECTS
Business Groups:
Lease and Asset Management
Cruise and Maritime Operations
Security Grant Expense
Total Business Group Expense
Service Depts:
Commercial Strategy
Seaport Environmental and Planning
Seaport Finance
Other
Seaport Administration
Seaport Contingency
Seaport Environmental Remediation Liability Expense
Seaport Capital to Expense
Total Services Expense
Notes
2012
Budget
2013
Budget
1
$ 82,599
15,668
394
98,661
$ 81,000
15,554
1,598
98,151
$ 92,562
17,133
173
109,869
14.3%
10.2%
-89.1%
11.9%
7,059
3,160
474
10,693
8,189
3,985
1,476
13,649
8,255
3,897
12,152
0.8%
-2.2%
-100.0%
-11.0%
1,551
4,486
1,043
1,841
4,554
1,127
1,895
4,609
1,152
3.0%
1.2%
2.3%
574
(633)
1
7,022
758
8,280
783
1,170
9,609
3.2%
16.0%
17,715
21,929
21,761
-0.8%
(1,620)
(1,521)
(1,263)
-17.0%
7,005
3,160
474
10,640
8,061
3,985
1,476
13,522
8,156
3,897
12,053
1.2%
-2.2%
-100.0%
-10.9%
1,551
2,998
951
1,841
3,275
1,012
1,895
3,557
1,040
3.0%
8.6%
2.8%
574
(633)
14
5,455
758
6,886
783
1,170
8,445
3.2%
2
Total Expenses Before Charges to Cap/Govt /Envrs Projects
CHARGES TO CAPITAL/ GOVT /ENVRS PROJECTS
OPERATING & MAINTENANCE EXPENSE
Business Groups:
Lease and Asset Management
Cruise and Maritime Operations
Security Grant Expense
Total Business Group Expense
Service Depts:
Commercial Strategy
Seaport Environmental and Planning
Seaport Finance
Other
Seaport Administration
Seaport Contingency
Seaport Environmental Remediation Liability Expense
Seaport Capital to Expense
Total Services Expense
2
Total Operating Expense
3
$ 16,095
$ 20,408
3) Expenses do not include direct charges or allocations from other divisions.
V-19
22.6%
$ 20,498
0.4%
marbud.xls.marreorg
Notes:
1) Revenue does not include amounts credited to Seaport from other divisions such as Marine Maintenance in the Real Estate Division.
2) Terminal 117 was transferred to Real Estate for 2012 Budget.
% Change
2013 Bud 2012 Bud
2011
Actual
Port of Seattle
Seaport
2013 Budget and Business Plan
E. STAFFING
The following TABLE V-8 outlines the Full-Time Equivalents (FTEs) in the Seaport Division. Seaport is
budgeting 60 FTE’s for 2013, which is .1 FTE more than the 2012 budget.
TABLE V-8: SEAPORT DIVISION STAFFING
STAFFING
(Full-Time Equivalent Positions)
BUSINESS GROUP/DEPARTMENT
Business Groups:
Lease & Asset Management
Cruise & Maritime Operations
Total Business Groups
Service Departments:
Commercial Strategy
Seaport Environmental & Planning
Seaport Finance & Budget
Total Service Departments
Other
Seaport Administration
TOTAL SEAPORT DIVISION
Notes
1
2011
Actual
2012
Budget
2012
Est. Act.
2013
Budget
% Change
2013 Bud 2012 Bud
8.9
10.3
19.2
9.7
10.3
20.0
9.8
10.3
20.1
9.8
10.3
20.1
1.0%
0.0%
0.5%
9.3
19.6
9.0
37.9
9.3
19.6
9.0
37.9
9.3
19.6
9.0
37.9
9.3
19.6
9.0
37.9
0.0%
0.0%
0.0%
0.0%
2.0
59.1
2.0
59.9
2.0
60.0
2.0
60.0
0.0%
0.2%
FTE.XLS
Notes:
1) Vacant FTE Property Manager increased to 1.0 FTE.
V-20
Port of Seattle
Seaport
2013 Budget and Business Plan
F. SEAPORT CAPITAL BUDGET
TABLE V-9: SEAPORT DIVISION CAPITAL BUDGET SUMMARY
($ in 000's)
Committed Capital Projects
Lease & Asset Management
Cruise & Maritime Operations
Environmental Services
General Seaport
Security
Total Committed
Business Plan Prospective Projects
Total CIP
2013 2013-2017
Budget
CIP
$5,529
4,303
815
900
0
$11,547
$43,198
5,886
815
5,608
0
$55,507
% of
2013
Total
47.9%
37.3%
7.1%
7.8%
0.0%
100.0%
$1,500 $240,230
$13,047 $295,737
capsum.xls
FIGURE V-5: SEAPORT DIVISION COMMITTED CAPITAL BUDGET
($ in 000’s)
General Seaport
7.8%
Environmental Services
7.1%
Cruise & Maritime
Operations
37.3%
Lease & Asset
Management
47.9%
Committed CIP Total Spending: $11,547
V-21
Port of Seattle
Seaport
2013 Budget and Business Plan
G. SEAPORT DIVISION OPERATING STATISTICS
TABLE V-10: SEAPORT DIVISION OPERATING STATISTICS
International Containerized Trade
Metric Tons
Year
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012 Forecast
2013 Budget
(in 1000's)
8,366
8,407
7,891
9,720
11,975
11,377
12,407
10,556
10,469
14,603
14,895
10,767
10,071
Total Int'l & Dom. TEUS
Total TEU's
Growth
-15.5%
0.5%
-6.1%
23.2%
23.2%
-5.0%
9.1%
-14.9%
-0.8%
39.5%
2.0%
-27.7%
-6.5%
1,052,789
1,173,248
1,184,698
1,466,251
1,745,798
1,636,261
1,628,494
1,376,496
1,284,541
1,835,575
1,712,673
1,439,006
1,345,967
Port of Seattle
Growth
Total TEU's
-12.4%
1,163,388
11.4%
1,291,790
1.0%
1,397,658
23.8%
1,687,768
19.1%
1,968,455
-6.3%
1,858,652
-0.5%
1,848,186
-15.5%
1,575,622
-6.7%
1,466,046
42.9%
2,008,961
-6.7%
1,891,333
-16.0%
1,624,000
-6.5%
1,519,000
Other
Growth Total TEU's
-13.6%
151,721
11.0%
147,082
8.2%
88,724
20.8%
88,090
16.6%
119,474
-5.6%
128,708
-0.6%
125,318
-14.7%
128,870
-7.0%
118,550
37.0%
130,616
-5.9%
142,202
-14.1%
126,000
-6.5%
141,000
Seattle Harbor
Total TEU's
1,315,109
1,438,872
1,486,382
1,775,858
2,087,929
1,987,360
1,973,504
1,704,492
1,584,596
2,139,577
2,033,535
1,750,000
1,660,000
Growth
-11.6%
9.4%
3.3%
19.5%
17.6%
-4.8%
-0.7%
-13.6%
-7.0%
35.0%
-5.0%
-13.9%
-5.1%
Compound Growth
2001-2011
2006-2011
5.9%
5.5%
5.0%
0.9%
5.0%
0.3%
4.5%
0.5%
m ars tat.xls
Year
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012 Forecast
2013 Budget
Port of Seattle Facilities Total Tonnage
Domestic
International
Metric Tons
Metric Tons
(in 1000's)
Growth
(in 1000's)
Growth
2,611
2,055
2,341
2,453
2,369
2,615
2,546
2,266
1,947
1,907
2,019
1,732
1,769
-23.3%
-21.3%
13.9%
4.8%
-3.4%
10.4%
-2.6%
-11.0%
-14.1%
-2.1%
5.9%
-14.2%
2.2%
11,214
10,141
11,062
13,676
17,078
17,327
17,777
16,940
15,943
19,975
19,866
14,159
13,370
-8.3%
-9.6%
9.1%
23.6%
24.9%
1.5%
2.6%
-4.7%
-5.9%
25.3%
-0.5%
-28.7%
-5.6%
Total
Metric Tons
(in 1000's)
Growth
13,825
12,196
13,403
16,129
19,447
19,942
20,323
19,206
17,890
21,882
21,885
15,891
15,139
-11.5%
-11.8%
9.9%
20.3%
20.6%
2.5%
1.9%
-5.5%
-6.9%
22.3%
0.0%
-27.4%
-4.7%
Compound Growth
2001-2011
2006-2011
-2.5%
-5.0%
5.9%
2.8%
4.7%
1.9%
m a rs ta t.xls
Source: Port of Seattle Internal Tonnage Reporting Statistics System.
V-22
Port of Seattle
Real Estate
2013 Budget and Business Plan
REAL ESTATE DIVISION
A. 2013 BUDGET SUMMARY
TABLE VI-1: 2013 CASHFLOW SUMMARY
2013
($ in 000's)
SOURCES OF CASH
Operating Revenues
Interest Receipts
Proceeds from Bond Issues
Grants and Capital Contributions
Tax Levy
Other Receipts
Total
$
USES OF CASH
Expenses from Operations:
Operating & Maintenance Expense
Corporate Administrative Expense
Law Enforcement Costs
Environmental Expenditures
Total Operating Expenses
32,516
91
340
15,957
25
48,929
66.5%
0.2%
0.0%
0.7%
32.6%
0.1%
100%
39,002
48.1%
8.0%
2.1%
0.1%
58.3%
8,035
7.0%
5.0%
12.0%
2,816
17,088
66,940
4.2%
0.0%
25.5%
100%
32,179
5,331
1,412
80
Debt Service:
Interest Payments
Bond Redemptions
Total Debt Service
4,702
3,333
Other Expenses
Public Expense
Capital Expenditures
Total
$
Percent
of Total
Cashflow.xls RE
VI-1
Port of Seattle
Real Estate
2013 Budget and Business Plan
FIGURE VI-1: SOURCES OF CASH
($ in 000’s)
Other Receipts
0.1%
Proceeds from
Bond Issues
0.0%
Tax Levy
32.6%
Operating
Revenues
66.5%
Interest Receipts
0.2%
Grants and
Capital
Contributions
0.7%
Total Sources: $48,929
FIGURE VI-2: USES OF CASH
($ in 000’s)
Public Expense
0.0%
Other Expenses
4.2%
Capital
Expenditures
25.5%
Bond
Redemptions
5.0%
Interest
Payments
8.2%
Environmental
Expenditures
0.1%
Law Enforcement
Costs
2.2%
VI-2
Operating &
Maintenance
Expense
48.1%
Corporate
Administrative
Expense
8.8%
Total Uses: $66,940
Port of Seattle
Real Estate
2013 Budget and Business Plan
B. BUSINESS PLAN FORECAST
TABLE VI-2: BUSINESS PLAN FORECAST
($ in 000's)
OPERATING BUDGET
Notes
Operating Revenue
Operating & Maintenance Expense
Corporate & Capital Development Division Costs
Law Enforcement Costs
Environmental Expense
Total Operating Expense
Budget
2012
$
1
Net Operating Income Before Depreciation
Total Depreciation Expense
Net Operating Income After Depreciation
Committed Capital Budget
Business Plan Prospective
TOTAL CAPITAL BUDGET
32,401
Budget
2013
$
32,516
Forecast
2014
$
33,019
2015
$
33,562
2016
$
34,300
2017
$
Compound
Growth
2012 - 2017
35,132
1.6%
30,530
5,252
1,442
0
37,224
32,179
5,331
1,412
80
39,002
29,977
5,570
1,476
0
37,023
29,494
5,821
1,542
0
36,857
30,228
6,083
1,611
0
37,922
30,819
6,357
1,684
0
38,860
0.2%
3.9%
3.1%
0.0%
0.9%
(4,823)
(6,486)
(4,004)
(3,295)
(3,622)
(3,728)
5.0%
9,694
9,509
$ (14,517) $ (15,995)
$
2
$
10,924
3,600
14,524
$
$
16,788
300
17,088
$
$
8,974
7,110
16,084
$
$
4,542
13,520
18,062
$
$
4,683
3,350
8,033
$
$
2,034
7,800
9,834
Total
2013 - 2017
$
37,021
32,080
$
69,101
edbpfor.xlsx
Notes:
1) Consists of remaining Corporate & Capital Development costs to be allocated to Real Estate after direct charges have been coded to
Business Groups and Divisions or other costs allocated to Divisions. Most costs are allocated using a formula based on Expenses and
employees. For some departments specific allocation methodologies, such as employees for Human Resources & Development, are used.
2) See Section X for details of Capital Budget.
C. REAL ESTATE DIVISION BUSINESS PLAN
MISSION:
 To manage Port owned real estate in a manner that earns a positive return on the public’s investment;
 To be a catalyst for private investment by developing Port owned real estate in ways that will spur
development by others; and
 To utilize existing and future assets in ways that will benefit operations and expansion of the existing
Port business enterprises.
VISION:
 To financially break even, division wide, by 2020.
STRATEGIES/STRATEGIC GOALS:
 Increase the Real Estate Division’s Net Operating Income by:
o Maintaining occupancy levels and rental rates at or favorable to the broader market.
o Increasing property utilization by offering and executing long term ground leases for land
redevelopment.
o Acquiring or disposing of assets as circumstances warrant.
 Maintain Assets including:
o Preventing recurrence of deferred maintenance backlog.
o Being aggressively defensive in asset management through 2016 to minimize economic damage
related to the reconstruction of the seawall and the construction of the Alaskan Way tunnel and
viaduct demolition.
VI-3
Port of Seattle
Real Estate




2013 Budget and Business Plan
Enhance Public Safety and Security at Port owned facilities.
Foster new economic activity by creating opportunities for local businesses.
Promote environmental stewardship by conducting business activities in environmentally
appropriate ways.
Be a high performance organization by providing a culture of clear expectations and accountability.
DESCRIPTION:
The Real Estate Division integrates the efforts of five functional workgroups: Real Estate Development &
Planning, Harbor Services, Marine Maintenance, Portfolio Management and Pier 69 Facilities Management.
These business and service groups oversee the development and management of various Port assets including
vessel moorage facilities. Financial services, project management, and environmental services are supported
by the Seaport Division.
Following are the five business groups and their functions:
Harbor Services Operates & leases moorage/storage/yard facilities and provides a variety of services. Its
two commercial fishing moorage facilities, home to the North Pacific Fishing Fleet, provide space for more
than 600 commercial fishing vessels, commercial work vessels as well as recreational vessels. Its three
recreational marinas provide facilities for more than 1,600 recreational and commercial fishing vessels.
Portfolio Management Leases, markets, and manages the Division’s portfolio of conference, office, retail,
commercial, and industrial properties and works to enhance the value of the Division’s assets through strategic
asset planning and repositioning. This business unit will also lead the asset management efforts related to the
Eastside Rail Corridor.
Real Estate Development & Planning Plans and facilitates the development of selected real estate assets
currently within its own portfolio and provides development expertise and support to the Seaport and Aviation
Divisions. The team also identifies and evaluates new opportunities outside the Port’s current portfolio and
completes other transactions related to Port assets.
Marine Maintenance Provides comprehensive maintenance, repair and small capital services to properties
and equipment in the Real Estate and Seaport Divisions. Marine Maintenance also has the obligations to
maintain the 23 park and public access properties owned by the Port of Seattle.
Pier 69 Facilities Management Ensures functionality of Port Headquarters by integrating people, place,
process, and technology. Operations include reception, motor pool, mailroom, shipping & receiving,
conference center, and Portside Café.
VI-4
Port of Seattle
Real Estate
2013 Budget and Business Plan
2013 STRATEGIES AND OBJECTIVES
STRATEGY: INCREASE NET OPERATING INCOME
Objective: Meet 2013 Financial Targets
($6,486) thousand NOI before Depreciation. Each Business Group will contribute to the total Division NOI
as budgeted:
 Real Estate Development & Planning
NOI = ($943) Thousand
 Harbor Services
NOI = ($3,760) Thousand
 Portfolio Management
NOI = ($1,298) Thousand
 Eastside Rail
NOI = ($406) Thousand
 Environmental Remediation Liability
NOI =
($80) Thousand
Objective: Achieve Target Occupancy While Maintaining Market Rates
 Maintain 92% occupancy of commercial properties.
 Achieve moorage occupancy of: Recreational Marinas 92%, Fishing & Commercial facilities 78%.
Objective: Generate New Revenue by Increasing Property Utilization
 Advance Fishermen’s Terminal 25 year re-development plan in conjunction with Century Agenda.
 Terminal 91 Uplands – Advance redevelopment of the site; increase interim revenue.
 Des Moines Creek Business Park – Advance build-out of the site.
STRATEGY: MAINTAIN ASSETS
Objective: Maintain Assets
 Eliminate deferred maintenance backlog.
 Update Shilshole Bay Marina site plan.
 Complete key 2013 construction projects:
o Pier 69 North Apron Piling Corrosion Protection
o FT C-15 HVAC replacement
o Various roof replacements
STRATEGY: FOSTER NEW ECONOMIC OPPORTUNITY
Objective: Foster New Business Opportunities for Local Businesses
 Utilize small business for 15% of all goods and services.
STRATEGY: PROMOTE ENVIRONMENTAL STEWARDSHIP
Objective: Integrate Business Friendly Environmental Objectives into our Organization
 Maintain Clean Marina Washington/EnviroStar Certification at Harbor Services facilities.
 Zero environmental regulatory violations.
 Electrical consumption at Pier 69 facility is within 5% of 2012 levels for Port of Seattle occupied
space.
 Zero increase in landfill waste from the Marine Maintenance shop.
STRATEGY: BE A HIGH PERFORMANCE ORGANIZATION
Objective: Maintain an Educated Workforce
 100% of staff will include a personal development plan in PREP.
VI-5
Port of Seattle
Real Estate
2013 Budget and Business Plan
Objective: Provide a Safe Workplace
 Achieve a perfect safety score and zero accidents.
HARBOR SERVICES
MISSION:
 Manage cost-effective operations that: deliver the best value for our customers’ dollars; provide an
extraordinary customer service experience to vessel operators and the public; provide a rewarding work
environment for our employees; and promote a spirit of partnership within the communities that we serve.
 Maintain Fishermen’s Terminal as the homeport to the North Pacific Fishing Fleet by providing facilities
and services that support the commercial fishing and other maritime industries, while working toward
breakeven financial performance.
DESCRIPTION:
Harbor Services provides and operates moorage facilities in various locations throughout Seattle, including a
full range of services, to meet the needs of a diverse group of vessel operators. The facilities are:
 Bell Harbor Marina
 Fishermen’s Terminal
 Harbor Island Marina (Terminal 102)
 Maritime Industrial Center
 Shilshole Bay Marina
Together these facilities supply over 2,000 moorage slips and related products for fishing, recreational, Tribal
and other commercial vessels up to 400’ including supporting services. There are approximately 3,000
monthly moorage customers and approximately 13,000 guest moorage visitors annually. Customer service is
our primary focus. Customer types include: commercial and sport fishermen, commercial pleasure and
workboat operators, recreational boaters, Tribal members and the largest live-aboard community in the State of
Washington (approximately 550 people).
There is a strong link between the facilities and the Ballard, Magnolia, Central Seattle Waterfront and West
Seattle communities.
STRATEGIES:
 Increase net operating income.
 Achieve target vessel moorage occupancy levels while maintaining market rates.
 Maintain assets to meet market demands and provide compelling value to current and future customers,
while focusing on earning a return on the public’s investment.
 Promote environmental stewardship.
 Enhance public safety and security by minimizing the risks of loss, both economic and physical, to the
public.
 Be a high performance organization.
VI-6
Port of Seattle
Real Estate
2013 Budget and Business Plan
KEY STRATEGIES AND OBJECTIVES
STRATEGY: INCREASE NET OPERATING INCOME
Objective: Meet 2013 Financial Targets/Manage within Authorized Budget
Performance Measure
Performance Target
Actions
Harbor Services Total
NOI before depreciation
of ($3,760K)


Fishing/Commercial
NOI before depreciation
of ($3,977K)


Recreational Boating
NOI before depreciation
of $217K


Operational solution for
SBM Fuel Dock ready for
implementation 2014

Launch RFP for Fuel
Dock Operation Q3
Monthly review of plans and spending to
meet targets (revenues & expenses)
Execute operations & marketing plans;
adjust as necessary throughout the year
Monthly review of plans and spending to
meet targets (revenues & expenses)
Execute operations & marketing plans;
adjust as necessary throughout the year
Monthly review of plans and spending to
meet targets (revenues & expenses)
Execute operations & marketing plans;
adjust as necessary throughout the year
Develop RFP & advertise
Key Objective: Achieve Target Occupancy While Maintaining Market Rates
Performance Measure
Achieve moorage
occupancy goals
Performance Target
Total Fishing: 78%
FT: 78%
MIC: 70%
Actions


Total Recreational: 92%
SBM: 94%
HIM: 88%
BHM: 69%
Effectively manage derelict vessels and
vessel liability insurance programs
Operations & Marketing continually review
Marketing Plans to ensure alignment with
market conditions/trends
Objective: Generate New Revenue By Increasing Property Utilization
Performance Measure
Performance Target
Actions
Advance Fishermen’s
Terminal 25-year
Redevelopment Plan in
alignment with Century
Agenda
Implement Commission
selected Plan


Q3
VI-7
Support & work with Portfolio Management
on implementation of the plan including
integration of net shed buildings Option 1
findings
Continue integration of Asset Condition
Assessment/Plan into operations, capital &
maintenance plans and budgets
Port of Seattle
Real Estate
2013 Budget and Business Plan
STRATEGY: ENHANCE PUBLIC SAFETY & SECURITY
Objective: Ensure that Facilities are in Compliance with Appropriate Code Requirements
Performance Measure
Performance Target
Actions
FT Net Shed Buildings
Option 1 Improvements
Meet Key Milestones
Q1 Commission

Q4 Begin construction

Gain Commission funding approval to
implement Option 1. Implement
outreach/communications plan & schedule
Start construction of Commission selected
option 1
STRATEGY: MAINTAIN ASSETS
Objective: Maintain and Update Assets
Performance Measure
Performance Target
Actions
Update Shilshole LongTerm Site Plan
Complete end Q2

Work with Portfolio Management, and an
outside consultant, to update the existing site
plan. Examine implications of revised
Shoreline regulations
Implement Key 2013
capital projects at FT &
SBM
 Initiate design on SBM
Central Seawall &
Restroom Building
Replacements by end
of Q4
 Complete FT Net Shed
9 Roof Replacement
by end of Q4

Gain Commission approval & start design

Gain Commission approval for construction
funding & complete construction
STRATEGY: FOSTER NEW ECONOMIC OPPORTUNITY
Objective: Foster New Business Opportunities for Local Businesses
Performance Measure
Performance Target
Actions
Utilize small businesses
15% of direct expense

When feasible, utilize qualified small
businesses
STRATEGY: PROMOTE ENVIRONMENTAL STEWARDSHIP
Objective: Integrate Business Friendly Environmental Objectives into our Organization.
Performance Measure
Performance Target
Actions
Institute Environmental
Q1 Analyze
 Working with the Environmental
Management Program
recommendations
Department, analyze recommendations &
implement feasible actions at FT & SBM
Q2 Implemention of cost
effective solutions
Implement one Green Port
Initiative project at FT
Q2 Complete assessment
Q4 Begin design
VI-8

Complete assessment & if warranted, begin
design of FT Fueling Station Improvements
Port of Seattle
Real Estate
2013 Budget and Business Plan
Objective: Conduct Business Activities in Environmentally Appropriate Ways
Performance Measure
Performance Target
Actions
Maintain Clean Marina
Washington/EnviroStar
Certifications

Certification renewed at
all HSG facilities

Maintain standards to satisfy regulatory biannual certification requirements
Enforce Marina Best
Management Practices
(BMP’s) & agency
regulations

Zero regulatory
violations

Work with Environmental Dept. to update
BMP’s (annually)
Staff educates customers & enforces BMP’s
when on the docks

STRATEGY: BE A HIGH PERFORMANCE ORGANIZATION
Objective: Provide a Culture of Clear Expectations and Accountability
Performance Measure
Performance Target
Actions
PREP Plans include clear
accountabilities,
training/development plan
and diversity component

100% Q4
All employees understand accountabilities
& how their work links to the Harbor
Services Business Plan & the Port and Real
Estate Division initiatives. Execute
operations & marketing plans; adjust as
necessary throughout the year
Objective: Maintain an Educated Workforce
Performance Measure
All staff attend one
diversity activity
Performance Target
100% of staff attend one
event by Q4
Actions

All staff attends or participates in at least
one diversity activity or event as part of
PREP Plan
All staff PREPS include a
development plan.
100% completion of
development plans by Q4.

All PREP plans include a
training/development plan
Objective: Provide a Safe Workplace
Performance Measure
Performance Target
Actions
Perfect Safety Audit and
zero accidents for year-end
2012
 100% on Safety Audit
Q1
 Zero accidents

VI-9
100% of employees complete all
requirements and training per the 2012
Facility Safety Plan
Port of Seattle
Real Estate
2013 Budget and Business Plan
TABLE VI-3: REAL ESTATE HARBOR SERVICES BUSINESS PLAN FORECAST
($ in 000's)
OPERATING BUDGET
Notes
Operating Revenue
Operating & Maintenance Expense
Corporate Administrative Expense
Total Operating Expense
Budget
2012
$
1
Net Operating Income Before Depreciation
Total Depreciation Expense
Net Operating Income After Depreciation
COMMITTED CAPITAL BUDGET
$
2
$
11,641
$
11,688
Compound
Growth
2012 - 2017
Forecast
Budget
2013
2014
$
11,856
2015
$
12,123
2016
$
12,379
2017
$
12,668
1.7%
9,963
3,913
13,876
11,513
3,935
15,448
10,613
4,113
14,726
9,829
4,298
14,127
10,074
4,491
14,565
10,272
4,693
14,966
0.6%
3.7%
1.5%
(2,236)
(3,760)
(2,869)
(2,004)
(2,186)
(2,297)
-0.5%
5,292
(7,527) $
5,115
(8,876)
-
$
1,421
$
1,000
$
2,450
$
2,450
$
-
Total
2013 - 2017
$
7,321
edbpfor.xlsx
Notes:
1) Consists of remaining Corporate costs to be allocated to Lines of Business after direct charges have been coded to LOB's
and Divisions or other costs allocated to Divisions. Most costs are allocated using a formula based on Expenses and
employees. For some departments specific allocation methodologies, such as employees for Human Resources & Development, are used.
2) See Section X for details of Capital Budget.
PORTFOLIO & ASSET MANAGEMENT
MISSION:
The mission of the Portfolio Management Department is to strategically postion the Division’s diverse real
estate portfolio of assets to achieve their maximum value through effective leasing and asset management. We
will accomplish our goals and provide our services with professionalism, integrity, respect for the environment
and in support of the regional economy.
DESCRIPTION:
We manage, maintain, market, and lease the Division’s portfolio of commercial and industrial properties and
work to enhance the value of our assets by regularly evaluating the overall performance of our portfolio to
determine the best use and configuration while continually work to increase our income and reduce our
expenses. We also administer leases and manage utility billing for both the Real Estate and Seaport Divisions.
The Portfolio is comprised of properties that serve office, retail and industrial tenants. Commercial properties
located along the Port’s central waterfront include:
 Pier 66 retail and office, including Bell Harbor International Conference Center and the Maritime
Event Center
 World Trade Center West and World Trade Center, Seattle
 Bell Street Parking Garage
 Pier 69
Other commercial properties are located at:
 T-102 (Harbor Marina Corporate Center)
 Ballard (Fishermen’s Terminal, the Maritime Industrial Center, and Shilshole Bay Marina)
 West Seattle (CEM and Pier 2)
 Interbay (Tsubota)
VI-10
Port of Seattle
Real Estate
2013 Budget and Business Plan
Industrial properties include:
 Parts of T-34, T-46, T-86 and T-5 SE
 Eastside Rail Corridor
STRATEGY:
We will achieve our projected net operating income for 2013 by focusing on tenant retention, new lease
opportunities and expense controls, and selectively evaluating our portfolio to identify new revenue-generating
opportunities. We will create and implement strategic redevelopment plans for our existing assets as required.
We will manage and maintain our assets to meet the needs of our tenants and customers and preserve and
enhance each asset’s value by employing appropriate levels of maintenance, repair, and environmental
controls.
MARKET FORECAST
Waterfront/Belltown/Lower Queen Anne Sub-market
(Reference: World Trade Center West Listing Broker Seattle Kidder Mathews, Jeff Huntington, and CB
Richard Ellis Second Qtr 2012 Market Reports and Co-Star Market Research.
Office
Vacancy rates vary by reporting services depending on exactly how to interpret the numbers, most specifically
do they include or exclude owner user buildings and are their numbers true vacancy or available space. These
differences can create several percentage point difference. The numbers included below come from our
Kidder Mathews Q1 2012 report.
The vacancy rate through the first quarter of 2012 for the CBD declined to 11.9%. The vacancy rate is
expected to decline further as we move along in 2012. Much of the recent activity has been specific to the
technology sector. We have not seen broader market activity across all groups which will be the major
indicator of a full recovery. Amazon continues to be the major driver in the Seattle Office Market, with the
recent announcement of plans to build upwards of 3.3M SF. Additionally they are rumored to be in the market
to lease additional office space to accommodate their immediate growth needs.
There is optimism in the market, but Seattle and San Francisco regions still appear to be outperforming the
balance of the country. With the decline in vacancy and positive market outlook, broader market rental rates
have seen a slight rise over the past few months. Some buildings in highly desirable locations (South Lake
Union, CBD and Pioneer Square) and/or spaces with the ―tech feel‖ have accounted for much of the rent
growth, where buildings outside of those areas have seen rents remain reasonably flat.
Specifically, the World Trade Center West Building is located within a unique niche of the waterfront
submarket. There is limited public transportation and our parking is not easily accessed from Alaskan Way.
The broad awareness of the upcoming seawall replacement and viaduct construction may also impact our
ability to attract new tenants. According to the current listing broker (Kidder Matthews) the projected market
rate for this building will tick up slightly due to two of the vacancies having Elliott Bay views. The first floor,
1800 SF vacancy will remain flat. Asking rents for the fourth floor space should now be in the mid $20s with
the third floor just below that. The first floor space should be in the low $20s (all rates are quoted on a fully
serviced basis). Our tenants generally pay increases in operating expenses over a base year.
VI-11
Port of Seattle
Real Estate
2013 Budget and Business Plan
South Seattle Sub-Market
(Reference: CoStar Quarterly Report; South Seattle Quarterly; CBRE)
Industrial
The Industrial market ended the first quarter 2012 with an overall vacancy rate of 17.1% including both direct
and sublease space, down from year end 2011 which was at 17.9%. The market has experienced a net positive
absorption totaling 687,478 square feet in the first quarter. Building values are increasing due to positive
leasing trends, a scarcity of developable lands and increasing rents. Seattle’s forecast is for vacancy to
continue to decline, but for submarkets to recover at an uneven rate, with properties that are challenged by
traffic and other issues expected to recover at a slower rate than other similar properties situated in different
submarkets. Rental rates ended the first quarter at $5.88 which is an increase over the previous quarter.
Class B Flex/Office Space
The Flex/Office market ended the first quarter 2012 with an overall vacancy rate of 10.5%. The vacancy rate
was down over the previous year which was at 13.0%, with positive net absorption totaling 325,813 square
feet in the first quarter. Flex projects reported an increase in vacancy rate of 21.7%, which was up from the
previous year. The Flex building market recorded net absorption of negative (84,033) square feet in the first
quarter 2012, compared to positive (108,038) square feet in the fourth quarter 2011.
The south end office and flex market continues to experience high vacancy rates in 2012 as tenants downsizing
and vacating space are outpacing new tenant activity. Location and quality is also an issue, as south end
tenants are taking advantage of lower rates in downtown locations that provide greater amenities and easy
access to public transportation.
Ship Canal/Ballard Submarket
(Reference: Cannon Commercial RE Services 1st Qtr. 2012, Grubb & Ellis 4th Q 2011 and Cushman and
Wakefield 1st Q 2012)
The lingering effects of the recession are subsiding and according to local market reports we will experience
steady but slow improvements in 2012. Although the Ship Canal office submarket has a number of forces that
have kept vacancy rates low such as the University of Washington, the Bio-Medical Industry, Seattle Pacific
University and the Maritime Industry, we have seen some non-maritime tenants being lured away by the low
rents and concessions that are being offered by landlords in the Central Business District (CBD). This will
happen less and less as the CBD recovers and the vacancies decrease. The attractiveness and popularity of
Fremont, Magnolia, Ballard and Wallingford are factors that have allowed many buildings in the area to retain
tenants and sustain more demand than some of the other office submarkets.
Class B Office
The vacancy rate for office space in the Ship Canal submarket, as a whole is 13.8 % compared to 14.2 %
vacancy rate in the Queen Anne/Magnolia submarket. The rates quoted in the various reports are for Class A
office space. Market rates for Class B office space remain similar to those in 2011 and range from $16.00 $18.00/SF NNN for nicer well-kept Class B office space, but several brokers indicated that a landlord would
be lucky to get $16.00/SF/NNN today for ―like new‖ space. Most landlords are offering concessions that
include a combination of abated rent and up to $50.00/SF for tenant improvements. The groups willing to pay
market rate are government related, involve cutting edge technology or are involved in industries similar to
renewable energy. According to most reports and to local brokers, rates should remain flat until consistent
leasing and positive absorption ease pressure on landlords, which is anticipated to level out over the next
twelve months.
Industrial
The available quarterly reporting on industrial focuses on the Kent Valley, where average rates for
warehouse/distribution are $.49/sf/mo. This is expected to increase slightly in 2012. Average warehouse rates
VI-12
Port of Seattle
Real Estate
2013 Budget and Business Plan
in the Ship Canal area are around $.55/sf/mo. Land is ranging from $.15-.20/sf/mo. In general the Ship Canal
submarket, Ballard in particular, is an extremely tight market. A lot of buildings are owned and occupied by
businesses that have been there for decades. In addition, the increased development in the submarket in recent
years has resulted in a decline in industrial inventory. This makes it difficult for smaller companies to lease
space and in turn keeps rents a bit higher than what is seen in submarkets like Georgetown. Despite the slow
economy, 2-10K sf warehouse spaces remain in high demand and lease up quickly. According to brokers in
the area, rates for warehouse space in the 2-10K sf range are getting deals done around $.50-$.65/ sf/month
with an office add-on of $.70-$.75/sf/month. Land is ranging from $.15-$.20/sf/mo. Although there is no
clear broker reporting on industrial properties in the Ship Canal/Ballard market, local brokers confirm that
warehouse space and vacant land are scarce. In the 1st Quarter of 2012 the Port acquired an appraisal done by
CIC Valuation Group on the Fishing Vessel Owner Marine Ways leased premises at Fishermen’s Terminal.
The City of Seattle hired CIC to do the appraisal in connection with the Ballard Bridge Seismic Project. Land
came out at $.20/sf/month, the same as last year.
KEY STRATEGIES AND OBJECTIVES
STRATEGY: INCREASE NET OPERATING INCOME
Objective: Meet 2013 Financial Targets
Performance Measure
Performance Target
Actions
Administrative expense
$1,617 thousand
(org basis)

Monthly review and adjustment in spending
to meet target
Commercial/Industrial
Property NOI
($2,954) thousand

Monthly review and adjustment in spending
to meet target
Conference & Event
Centers NOI
$1,657 thousand

Monthly review and adjustment in spending
to meet target
Objective: Achieve Target Occupancy while Maintaining Market Rates
Occupancy of
Commercial Buildings at
year-end 2013
Year-end occupancy rate
will be 92% or better

Real estate managers will work with the
Director to refine the leasing strategy for
each asset to respond to current market
conditions
Objective: Generate New Revenue By Increasing Property Utilization
Advance Fishermen’s
Terminal 25 Year
Redevelopment Plan in
conjunction with the
Century Agenda
Initiate implementation of
25-Year Plan
VI-13

Portfolio Management will continue to lead
the 25 year planning process with the
support of Harbor Services focusing on the
implementation plan, environmental review
and gaining approval of the Port
Commission
Port of Seattle
Real Estate
2013 Budget and Business Plan
STRATEGY: FOSTER NEW ECONOMIC OPPORTUNITY
Objective: Foster New Business Opportunities for Local Businesses
Performance Measure
Performance Target
Actions
Utilize small businesses
10% of total expenditures
for goods and services (in
conjunction with
Maintenance)

The majority of contracts for our group are
led in conjunction with Maintenance and are
reflected in their statistics. When feasible,
utilize qualified small businesses to provide
consulting and real estate services such as
surveys, appraisals, brokerage, and market
studies
STRATEGY: PROMOTE ENVIRONMENTAL STEWARDSHIP
Objective: Integrate Business Friendly Environmental Objectives into our Organization.
Performance Measure
Performance Target
Actions
Support Port
Environmental
Department’s Tenant
Compliance Program
Visit at least four properties
per quarter

Real Estate managers and member(s) of
environmental staff will inspect selected
properties to ensure tenant compliance with
lease environmental requirements
Identify new ―green‖
initiatives
1 new ―green‖ initiative
identified by end of Q3

All staff participates to identify new ―green‖
initiative that can be adopted
STRATEGY: BE A HIGH PERFORMANCE ORGANIZATION
Objective: Provide a Culture of Clear Expectations and Accountability
Performance Measure
Performance Target
Actions
Identify work process
improvements
Identify one new tool to
improve effectiveness

Team will work together to identify new
work or technology tools to improve
effectiveness (e.g. rent rolls, Sharepoint,
etc)
Objective: Maintain an Educated Workforce
% Participation in
diversity activities
100 % of staff

Staff members will attend or participate in
one diversity activity per year
% Attendance in real
estate classes, seminars or
conferences
90% of staff

Staff members will attend at least two real
estate classes, seminars or conferences
% Personal development
plan in PREP
100% of staff

Each employee will include a personal
development plan in PREP
VI-14
Port of Seattle
Real Estate
2013 Budget and Business Plan
TABLE VI-4: PORTFOLIO MANAGEMENT BUSINESS PLAN FORECAST
($ in 000's)
OPERATING BUDGET
Budget
2012
Notes
Operating Revenue
$
Operating & Maintenance Expense
Corporate Administrative Expense
Total Operating Expense
19,923
1
Net Operating Income Before Depreciation
Total Depreciation Expense
Net Operating Income After Depreciation
$
$
Compound
Growth
2012 - 2017
Forecast
Budget
2013
2014
19,965
$
18,503
2,486
20,989
18,745
2,517
21,262
(1,066)
(1,298)
4,193
(5,260) $
4,177
(5,476)
2015
20,330
$
2016
20,590
$
2017
21,102
$
21,627
1.7%
17,528
2,630
20,159
17,784
2,749
20,532
18,226
2,872
21,098
18,579
3,002
21,581
0.1%
3.8%
0.6%
171
58
4
46
153.4%
Total
2013 - 2017
COMMITTED CAPITAL BUDGET
2
$
4,880
$
4,692
$
5,680
$
483
$
433
$
87
$
11,375
edbpfor.xlsx
Notes:
1) Consists of remaining Corporate costs to be allocated to Lines of Business (LOB) after direct charges have been coded to LOB's
and Divisions or other costs allocated to Divisions. Most costs are allocated using a formula based on Expenses and employees.
For some departments specific allocation methodologies, such as employees for Human Resources & Development, are used.
2) See Section X for details of Capital Budget.
TABLE VI-5: EASTSIDE RAIL BUSINESS PLAN FORECAST
($ in 000's)
OPERATING BUDGET
Budget
2012
Notes
Operating Revenue
$
Operating & Maintenance Expense
Corporate Administrative Expense
Total Operating Expense
Net Operating Income Before Depreciation
Total Depreciation Expense
Net Operating Income After Depreciation
$
22
$
Compound
Growth
2012 - 2017
Forecast
Budget
2013
2014
7
$
2015
7
$
2016
7
$
2017
7
$
8
-19.4%
-6.0%
621
0
621
413
0
413
423
0
423
434
0
434
445
0
445
456
0
456
-6.0%
(599)
(406)
(416)
(427)
(437)
(448)
5.6%
0
(599) $
0
(406)
Total
2013 - 2017
COMMITTED CAPITAL BUDGET
$0
$0
VI-15
$0
$0
$0
$0
$0
edbpfor.xlsx
Port of Seattle
Real Estate
2013 Budget and Business Plan
DEVELOPMENT AND PLANNING
MISSION:
The Real Estate Development and Planning team plans and facilitates development of selected real estate
assets currently within the Port’s portfolio. The team also identifies and evaluates acquisition opportunities
outside the Port’s current portfolio and completes ground leases and sales of Port assets.
DESCRIPTION:
The team connects to the Port’s mission of creating regional economic vitality by: (i) advancing the planning
and development of certain assets the Port currently owns and (ii) identifying and analyzing new opportunities
and projects and, where appropriate, completing these transactions.
STRATEGY:
In 2013, the team will continue to work toward completing transactions that will generate new, near-term
revenue. The team will also continue planning on sites that have a longer horizon for new revenue and job
generation. In addition, the team will continue to assist the Aviation Division with its off-airfield land
development program in the cities of Des Moines, Burien and SeaTac and the Seaport Division with key
initiatives as needed.
KEY STRATEGIES AND OBJECTIVES
STRATEGY: INCREASE NET OPERATING INCOME
Objective: Generate New Revenue By Increasing Property Utilization
Performance Measure
Performance Target
Actions
Terminal 91 Uplands
redevelopment; interim
revenue
Advance redevelopment of
the site; increase interim
revenue

Des Moines Creek
Business Park build-out
Advance build-out of the
site





Burien—Northeast
Redevelopment Area
Implement key
recommendations from the
NERA redevelopment
strategy



VI-16
Identify and execute additional short-term
leases
Identify and analyze potential long-term
tenants consistent with the Century Agenda
framework
Continue coordination of permitting and
plan review work with PSE
Monitor construction of PSE’s operations
center consistent with the ground lease
terms
Prepare and implement a marketing and
disposition plan for the remainder of the site
Negotiate and execute a potential ground
lease with a developer for the FAA office
headquarters project
Finalize purchase and sale agreement and
close on the potential sale of the Lora Lake
site
Collaborate with the City of Burien on the
planning and design of a regional
stormwater system
Implement a marketing and disposition plan
for the NERA 3 area to support air cargo
Port of Seattle
Real Estate
2013 Budget and Business Plan


City SeaTac Sites
Advance redevelopment
planning



Other Acquisition, Sales,
and Easements

Complete agreements
development
Collaborate with the City of Burien and
submit an application for FAA pilot project
funds
Acquire an abandoned street (11th Avenue
S.) from the City of Burien to complete
assemblage of the NERA 3 area
L-Shape Site:
o Implement a marketing and
disposition plan to support air cargo
development
Hotel Site:
o Select a developer
o Negotiate and execute potential
ground lease and development
agreements
th
28 Avenue S. Site:
o Prepare marketing and disposition
plan
o Begin relocation of existing tenants
and building demolition
o Negotiate and execute a potential
ground lease with a developer for
the FAA office headquarters project
Sound Transit Link Light Rail Extension Memorandum of Agreement:
o Complete various acquisition, sale
and easement agreements
STRATEGY: BE A HIGH PERFORMANCE ORGANIZATION
Objective: Maintain an Educated Workforce
Performance Measure
Performance Target
Actions
% Participation in
diversity activities
100% of staff

Staff members will attend or participate in
one diversity activity per year
% Attendance in
professional development
class, seminars or
conferences
90% of staff

Staff members will attend at least two
professional development classes, seminars
or conferences
% Personnel
development plan in
PREP
100% of staff

Each staff member will include a personal
development plan in PREP and complete the
proposed elements
VI-17
Port of Seattle
Real Estate
2013 Budget and Business Plan
TABLE VI-6: DEVELOPMENT AND PLANNING BUSINESS PLAN FORECAST
($ in 000's)
OPERATING BUDGET
Notes
Operating Revenue
Operating & Maintenance Expense
Corporate Administrative Expense
Total Operating Expense
Net Operating Income Before Depreciation
Total Depreciation Expense
Net Operating Income After Depreciation
COMMITTED CAPITAL BUDGET
Budget
2012
$
1
812
Forecast
Budget
2013
$
1,439
295
1,733
853
1,506
290
1,796
(922)
(943)
209
$ (1,131) $
2014
$
823
1,409
303
1,712
(889)
2015
$
839
1,444
317
1,761
(922)
2016
$
808
2017
$
Compound
Growth
2012 - 2017
826
0.3%
1,480
331
1,811
1,508
346
1,854
1.0%
3.2%
1.4%
(1,003)
(1,028)
-2.2%
216
(1,159)
$0
$0
$0
$0
$0
$0
Total
2013 - 2017
$0
edbpfor.xlsx
Notes:
1) Consists of remaining Corporate costs to be allocated to Lines of Business after direct charges have been coded to LOB's
and Divisions or other costs allocated to Divisions. Most costs are allocated using a formula based on Expenses and
employees. For some departments specific allocation methodologies, such as employees for Human Resources &
Development, are used.
VI-18
Port of Seattle
Real Estate
2013 Budget and Business Plan
MARINE MAINTENANCE
MISSION:
The mission of the Marine Maintenance Department is to maintain, preserve, upgrade, improve and enhance,
as directed, the assets owned by the Real Estate and Seaport Divisions. We conduct our activities in a manner
that fosters competitive business practices, customer service and benefit to the public and local businesses, as
well as environmental responsibility and conservation.
We serve in support of the Century Agenda and tie our departmental goals to that plan and to the mission and
goals of the Real Estate Division.
DESCRIPTION:
Maintenance disciplines include automotive, carpentry, marine carpentry, electrical, general labor, custodial
labor, landscape labor, painting, plumbing, sprinkler-fitting (fire protection), sheetmetal, welding, truck
driving sign writing, HVAC maintenance and elevator/escalator maintenance. Most maintenance activities
required by Port assets are available through the Marine Maintenance Shop, as are public works including
small capital construction services and environmental and safety compliance support activities.
STRATEGY:
Our business strategy is to fulfill the maintenance needs of our partners and customers while acting as
stewards of the assets in the public trust.
 We conduct Preventive Maintenance and Corrective Maintenance to properly safeguard Port assets.
 We engage in expense and capital improvements to support partner departments’ business strategies.
 We fully support the Port’s business, community and environmental strategies with programs focused
on Economics, Equity - Social Responsibility, Environment, and Employee Engagement.
 We conduct our business activities in support of the Real Esate Division Strategic Goals to:
o Maintain occupancy levels and rental rates at or favorable to the broader market.
o Prevent recurrence of the deferred maintenance backlog.
o Offer and execute long term ground leases for land redevelopment.
o Acquire or dispose of assets, as circumstances warrant.
o Be aggressively defensive in asset management through 2016 to minimize economic damage
related to the reconstruction of the seawall and the construction of the Alaskan Way tunnel
and viaduct demolition.
KEY STRATEGIES AND OBJECTIVES
STRATEGY: INCREASE NET OPERATING INCOME
Objective: Meet 2013 Financial Targets
Performance Measure
Performance Target
Actions
Meet Authorized Budget
+/- 2%

Monthly review and adjustment in spending
to meet target
Reduce Trouble Calls
Urgent Maintenance
15%
15%


Increase Preventative Maintenance
Reduce Trouble Calls
VI-19
Port of Seattle
Real Estate
Eliminate Deferred
Maintenance Backlog
2013 Budget and Business Plan
Small Project List
Completed
Commission Actions
Initiated for All 2012-13
Large Projects

Continue Deferred Maintenance reduction
plan
STRATEGY: FOSTER NEW ECONOMIC OPPORTUNITY
Objective: Foster New Business Opportunities for Local Businesses
Performance Measure
Performance Target
Actions
Utilize small businesses
15% of operating and
capital expenditures

Track purchasing and contracting activities
Increase work force
training, job and business
opportunities for local
communities in trade,
travel and logistics
Five Apprentices and
Twelve Interns per year


Utilize Apprenticeships and Internships
Continue outreach to schools and support
organizations
Work with Aviation to share programs such
as CWEST

STRATEGY: PROMOTE ENVIRONMENTAL STEWARDSHIP
Objective: Integrate Business Friendly Environmental Objectives into our Organization
Performance Measure
Performance Target
Action
Compliance with existing
programs and initiation of
new endeavors related to
the goal to be the
greenest, most energy
efficient port in North
America
Maintain reduced tonnage
of landfill waste and
increased tonnage of
recyclables

Zero increase in landfill waste from shop.
Ensure efficient collection & disposal of
garbage & ensure recycling
Compliance with
environmental
regulations in the conduct
of our activities
100% Compliance

Meet or exceed agency requirements for
storm water leaving Port owned or operated
facilities
Train 100% of available staff and
craftspeople in annual safety training day
Communicate regulatory changes during
monthly safety meetings


Maintain EnviroStar and
Salmon Safe Certification
Certification is renewed at
all facilities


Ensure EnviroStars Compliance
Ensure Salmon Safe Compliance
Track and reduce travel
miles by Marine
Maintenance vehicles
10% reduction in travel
miles

Reduce air pollutants and carbon emissions,
specifically:
o Reduce air pollutant emissions by
50% from 2005 levels
o Reduce carbon emissions from all
VI-20
Port of Seattle
Real Estate
2013 Budget and Business Plan
Port operations by 50% from 2005
levels
Identify new ―green‖
initiatives
1 new ―green‖ initiative
identified by end of Q3
All staff participates to identify new ―green‖
initiative that can be adopted
STRATEGY: BE A HIGH PERFORMANCE ORGANIZATION
Objective: Provide a Culture of Clear Expectations and Accountability
Performance Measure
Performance Target
Action
Identify work process
improvements
Identify one new tool to
improve effectiveness
Identify new work or technology tools to
improve effectiveness (e.g. workflow,Akwire,
etc)
Participate in LEAN programs
Objective: Maintain an Educated Workforce
% Participation in
diversity activities
100 % of staff

Staff members will attend or participate in
one diversity activity per year
% Attendance in classes,
seminars or conferences
30% of staff

Staff members will attend at least one class,
seminar or conference
% Personal development
plan in PREP
100% of staff

Each non-represented employee will include
a personal development plan in PREP

All employees will comply with Workplace
Responsibility initiatives and Code of
Conduct
% Compliance –
Workplace Integrity
initiatives and Code of
Conduct
100% of staff
VI-21
Port of Seattle
Real Estate
2013 Budget and Business Plan
PIER 69 FACILITIES MANAGEMENT
MISSION:
To provide, operate and maintain a safe, secure, comfortable, productive and efficient workplace.
DESCRIPTION:
The department provides facilities management services for Pier 69 site including:
 Space management and planning
 Energy management
 Management and operation of mailroom, shipping/receiving
 Management and operation of conference center, commission chambers, and atrium meeting spaces
 Management and operation of Pier 69 motor pool
 Management of Portside Café lease
 Management and administration of access control, visitor management, and surveillance systems
 Corporate HQ reception services
 Representation of Real Estate Division on the Safety & Security Coordination Council
 Administration of site Commute Trip Reduction (CTR) program
STRATEGY:
 Hire, develop, and retain high performing, service oriented personnel
 Operate and maintain headquarter facilities with emphasis on continuous improvement, outstanding
customer service, optimal staffing levels, environmental stewardship, and proactive maintenance
 Partner effectively with Port maintenance departments
 Partner effectively with outsourced service providers, e.g., HVAC maintenance, elevator maintenance,
janitorial services, and building security services
 Represent the interests of the Real Estate Division on the Safety & Security Coordination Council and
Waterfront Emergency Preparedness Working Group
KEY STRATEGIES AND OBJECTIVES
STRATEGY: INCREASE NET OPERATING INCOME
Objective: Meet 2013 Financial Targets
Performance Measure
Performance Target
Actions
Manage within
authorized budget
Within 5% of approved
budget
Review performance monthly for variance and
make adjustments to spending if necessary
Successful completion of
approved capital
improvement and
expense projects
Approved projects are
completed on schedule and
within budget
Provide influential and decisive leadership for
Marine Maintenance and Seaport Project
Management partners
STRATEGY: FOSTER NEW ECONOMIC OPPORTUNITY
Objective: Foster New Business Opportunities for Local Businesses
Performance Measure
Performance Target
Actions
Success of Portside Café
Revenue from rent is >
minimum guarantee
Provide responsive landlord support for tenant
in accordance with lease agreement
VI-22
Port of Seattle
Real Estate
Utilize small and
disadvantaged businesses
2013 Budget and Business Plan
10% of operating
expenditures
Utilize qualified small and disadvantaged
businesses where feasible
STRATEGY: PROMOTE ENVIRONMENTAL STEWARDSHIP
Objective: Integrate Business Friendly Environmental Objectives into our Organization
Performance Measure
Performance Target
Actions
Maintain or reduce
electrical consumption
Electrical consumption is
within 5% of 2012 (POS
occupied space)
ENERGY STAR rating is
within 2 points of 2012
(Entire site)
Monitor and maintain building systems to
ensure that system components operate as
designed. Continue to look for opportunities to
reduce electrical consumption
STRATEGY: BE A HIGH PERFORMANCE ORGANIZATION
Objective: Provide a Culture of Clear Expectations and Accountability
Performance Measure
Performance Target
Actions
All staff participate in
professional development
100% compliance
Each staff member will identify at least one
development goal in their PREP plan
All staff complete
required training
100% compliance
All training as listed in LMS is either completed
or scheduled
STRATEGY: ENHANCE PUBLIC SAFETY & SECURITY
Objective: Develop a Coordinated Security and Public Safety Program for all Port Assets
Performance Measure
Performance Target
Actions
Maintain and update P69
FM COOP document
Complete plan update
before end of Q3
Periodic updates (contact information, etc.) are
done throughout the year. Plan review/update is
completed before end of Q3
VI-23
Port of Seattle
Real Estate
2013 Budget and Business Plan
D. REAL ESTATE OPERATING BUDGET SUMMARY
TABLE VI-7: REVENUE BY ACCOUNT
($ in 000's)
REVENUE BY ACCOUNT
Operating Revenue
Dckg, Whrfg, Serv/Facility, Passenger Fee
Equipment Rental
Berthage & Moorage
Parking Revenue
Revenue From Sale of Utilities
Property Rental Revenue
Other Revenues
Total Operating Revenue
2011
Actual
Notes
$
1
58
121
9,860
144
1,326
9,875
10,830
32,214
$
2012
Budget
$
$
62
78
10,005
152
1,287
10,139
11,107
32,828
% Change
2013 Bud
2012 Bud
2013
Budget
$
$
2
86
9,936
152
1,253
10,570
10,932
32,930
-96.8%
10.3%
-0.7%
0.0%
-2.6%
4.3%
-1.6%
0.3%
EDbud.xls REdata
Notes:
1) Revenue does not include allocations from other divisions.
FIGURE VI-3: REAL ESTATE DIVISION REVENUE BY ACCOUNT
($ in 000’s)
Dckg, Whrfg, Serv/Facility,
Passenger Fee
0.0%
Other Revenues
33.2%
Equipment Rental
0.3%
Berthage & Moorage
30.2%
Property Rental Revenue
32.1%
Parking
Revenue
0.5%
Revenue From Sale of
Utilities
3.8%
Total Revenue: $32,930
VI-24
Port of Seattle
Real Estate
2013 Budget and Business Plan
TABLE VI-8: OPERATING & MAINTENANCE EXPENSES BY ACCOUNT
% Change
2013 Bud
2012 Bud
($ in 000's)
2011
Actual
Notes
EXPENSE BY ACCOUNT
Salaries, Wages, Benefits & Workers Comp
Equipment Expense
Utilities
Supplies & Stock
Outside Services
Travel & Other Employee Expenses
Promotional Expenses
Other Expenses
Total O&M without Environmental
$
Environmental Expense
Total O&M with Environmental
Charges to Capital/Govt/Envrs Projects
Total Operating Expense
1
$
17,545
1,256
3,481
1,304
2,386
98
25
9,945
36,040
2012
Budget
$
19,594
1,411
3,627
1,336
3,705
197
47
8,543
38,460
2013
Budget
$
20,116
1,172
3,799
1,225
4,295
236
76
8,875
39,794
2.7%
-16.9%
4.7%
-8.3%
15.9%
19.8%
61.7%
3.9%
3.5%
7
36,047
0
38,460
80
39,874
0.0%
3.7%
(2,783)
33,264 $
(2,044)
36,416 $
(1,338)
38,536
-34.5%
5.8%
EDbud.xls REdata
Notes:
1) Tables VI-7, 8 & 9 differ from Table VI-2, in that they only reflect the division expenses and do not
include corporate allocations.
FIGURE VI-4: REAL ESTATE DIVISION EXPENSE BY ACCOUNT
($ in 000’s)
Environmental Expense
0.2%
Travel & Other Employee
Expenses
0.6%
Promotional Expenses
0.2%
Other Expenses
22.3%
Salaries, Wages, Benefits &
Workers Comp
50.4%
Outside Services
10.8%
Utilities
9.5%
Supplies & Stock
3.1%
Equipment Expense
2.9%
Total Before Charges to Capital/Govt/Evnrs Projects: $39,874
Charges to Capital/Govt/Envrs Projects: $1,338
Total Expense: $38,536
VI-25
Port of Seattle
Real Estate
2013 Budget and Business Plan
TABLE VI-9: REAL ESTATE REVENUE AND EXPENSE BY DEPARTMENT
(in 000's)
BY DEPARTMENT
2011
Actual
Notes
REVENUE
Harbor Services
Portfolio Management
Real Estate Development and Planning
Eastside Rail Corridor
Pier 69 Facilities Management
Marine Maintenance
Total Operating Revenue
$
EXPENSES BEFORE CHARGES TO CAP/ GOVT/ENVRS PROJECTS
Business Groups:
Harbor Services
Portfolio Management
2
Real Estate Development and Planning
Eastside Rail Corridor
Total Business Group Expense
Service Groups and Other:
Pier 69 Facilities Management
Marine Maintenance
Real Estate Administration
Contingency
Environmental Remediation Liability Expense
Real Estate Capital to Expense
Total Services Group and Other Expense
Total Expenses Before Charges to Cap/Govt/Envrs Projects
CHARGES TO CAPITAL/GOVT/ENVRS PROJECTS
OPERATING & MAINTENANCE EXPENSE
Business Groups:
Harbor Services
Portfolio Management
Real Estate Development and Planning
Eastside Rail Corridor
Total Business Group Expense
Service Groups and Other:
Pier 69 Facilities Management
Marine Maintenance
Real Estate Administration
Contingency
Environmental Remediation Liability Expense
Real Estate Capital to Expense
Total Services Group and Other Expense
Total Operating Expense
2
11,503
18,887
914
85
4
822
32,214
2012
Budget
$
$
$
11,611
19,877
850
7
% Change
2013 Bud 2012 Bud
585
32,930
-0.2%
0.3%
4.7%
-69.3%
-63.9%
8%
0.3%
4,347
12,131
725
1,585
18,789
4,614
12,441
799
203
18,057
4,854
12,843
854
177
18,728
5.2%
3.2%
6.9%
-12.7%
3.7%
1,382
15,425
404
1,482
18,688
396
500
80
21,146
-2.6%
1.0%
4.6%
7
41
17,259
1,521
18,503
378
20,403
36,047
38,460
39,874
3.7%
(2,783)
(2,044)
(1,338)
-34.5%
4,347
12,131
725
1,585
18,789
4,614
12,441
799
203
18,057
4,854
12,843
854
177
18,728
5.2%
3.2%
6.9%
-12.7%
3.7%
1,382
12,621
404
1,521
16,459
378
18,359
1,482
17,350
396
500
80
19,808
-2.6%
5.4%
4.6%
7
62
14,476
1
11,633
19,820
812
22
1
540
32,828
2013
Budget
33,264
$
36,416
$
38,536
3.6%
7.9%
5.8%
BDREBUD
Notes:
1) Expenses do not include direct charges or allocations from other divisions/groups such as Corporate and CDD
2) Terminal 117 was transferred from Seaport to Real Estate for 2012 Budget.
VI-26
Port of Seattle
Real Estate
2013 Budget and Business Plan
E. STAFFING
The following table outlines the Full-Time equivalents (FTEs) for both regular and other categories in the Real
Estate Division. The division is budgeting 168.3 FTE’s for 2013, 2.5 FTE higher than 2012 budget.
TABLE VI-10: REAL ESTATE DIVISION STAFFING
STAFFING
(Full-Time Equivalent Positions)
BY DEPARTMENT
Real Estate Administration
Harbor Services
P69 Facilities Management
Development and Planning
Portfolio Management
Marine Maintenance
TOTAL REAL ESTATE DIVISION
Notes
1
2
3
2011
Actual
2.0
30.8
8.0
2.0
14.0
108.0
164.8
2012
2012
Budget Est. Act.
2.0
2.0
30.8
30.8
8.0
6.0
3.0
3.0
14.0
14.0
108.0
108.0
165.8
2013
Budget
2.0
31.3
6.0
3.0
14.0
112.0
% Change
2013 Bud 2012 Bud
0.0%
1.5%
-25.0%
0.0%
0.0%
3.7%
168.3
1.5%
163.8
FTE.XLS
Notes:
1) Harbor Services added a .5 FTE for an Administrative Staff.
2) P69 Facilities Management - Closed Print Shop (-3 FTEs) and added a Facility Specialist.
3) Marine Maintenance added 4 Planners.
VI-27
Port of Seattle
Real Estate
2013 Budget and Business Plan
F. REAL ESATE DEVELOPMENT CAPITAL BUDGET
TABLE VI-11: REAL ESTATE DIVISION CAPITAL BUDGET SUMMARY
($ in 000's)
Committed Capital Projects
General Real Estate
Harbor Services
Portfolio Management
Total Committed
Business Plan Prospective Projects
Total CIP
2013
Budget
2013-2017
CIP
$10,675
1,421
4,692
$16,788
$18,325
7,321
11,375
$37,021
$300
$32,080
$17,088
$69,101
% of 2013 Total
63.6%
8.5%
27.9%
100.0%
capsum.xls
FIGURE VI-5: REAL ESTATE DIVISION COMMITTED CAPITAL BUDGET
($ in 000’s)
Committed CIP Total Spending: $16,788
Portfolio Management
27.9%
General Real Estate
63.6%
Harbor Services
8.5%
VI-28
Port of Seattle
Capital Development
2013 Budget and Business Plan
CAPITAL DEVELOPMENT DIVISION
A. 2013 BUDGET SUMMARY
TABLE VII-1: 2013 BUDGET SUMMARY
($ in 000's)
OPERATING RESULTS
Notes
Operating Expense
Total Operating Expense
COMMITTED CAPITAL BUDGET
2011
Actual
1
EMPLOYMENT (TOTAL FTEs)
2012
Budget
2013
Budget
Change % Change
2013 Bud- 2013 Bud2012 Bud 2012 Bud
$ 11,026
$ 11,026
$ 15,516 $ 14,780
$ 15,516 $ 14,780
$
$
(736)
(736)
-4.7%
-4.7%
$
$
$
344
86.4%
9.8
3.8%
480
264.5
398
255.8
$
742
265.5
CAPDEVSUM.XLS
Notes:
1) See Section X for details of Capital Budget.
B. DIVISION MISSION STATEMENT
MISSION:
The Capital Development Division (CDD) delivers projects and provides technical and contracting services
in support of the business plans and infrastructure needs of the Port of Seattle.
VISION:
The CDD is a service provider to the business divisions of the Port, attuned to their needs and priorities. As
Port employees, we are public servants, conscious of our obligations to policy objectives for jobs creation,
environmental protection and social responsibility and committed to openness and accountability for all our
actions. We strive to employ the best available technology and most efficient business practices. Our
employees are critical to short and long-term success of the organization.
STRATEGIES/STRATEGIC GOALS:
 Deliver projects to operating division customers on time, within budget, meeting agreed scope, and with
minimal and mutually-agreed impacts on operations.
 Support divisions beyond projects: including budget plan development; business planning; asset
management and reporting; community outreach; negotiations; and technical support and assistance.
 Provide contracting services.
 Be prepared for emergencies.
 Develop the talent, capabilities, motivation and well-being of CDD employees.
 Keep Port staff and contractor personnel working safely.
VII-1
Port of Seattle
Capital Development
2013 Budget and Business Plan
2013 STRATEGIES AND OBJECTIVES:
Strategy: Provide expertise and suggestions to sustainability initiatives at Airport, Seaport and Real Estate.
Improve procedures for consistently identifying sustainability opportunities in new projects. Lead
publication of the Port’s revised policy EX-15 procedures.
Objective: Support the business divisions in implementing sustainable asset management.
Strategy: Train staff, identify opportunities for improvement and participate in studies to improve efficiency
and reduce waste by mobilizing Port-wide energy for improvement.
Objective: Maximize the benefit of CDD participation in Continuous Process Improvement.
Strategy: Revise contract terms and conditions in cooperation with the Port’s Legal and the Association of
General Contractors. Assign responsibilities and develop a system for continuous update of technical
specifications.
Objective: Update Port standard specifications for construction projects.
Strategy: Enhance consistency, accessibility and staff expertise to improve SharePoint as CDD’s system for
team collaboration, document management, work flow and procedure standardization.
Objective: Optimize SharePoint in CDD.
Strategy: Support Port-wide initiatives flowing from the April 2011 FEMA exercise and strengthen CDD
capabilities such as damage assessment and emergency contracting.
Objective: Improve Emergency Response readiness.
C. KEY FUNCTIONS & STRATEGIES
OVERVIEW:
The three operating divisions of the Port are supported by the CDD based on level of project and contracting
services required to support their operations and capital & expense project needs. The services by the
departments within the division are demand driven.
The major responsibilities and goals for the CDD in 2013 are:
AVIATION PROJECT MANAGEMENT GROUP:

Key Functions & Responsibilities:
o Deliver capital & expense projects for Aviation Division on time, within budget, meeting agreed
scope, and with minimal and mutually-agreed impacts on airport operations.
o Ensure that procurement meets requirements of State law, Port policies & procedures, federal grants,
and other controlling regulations.
o Assist Aviation Division in initial project scoping, cost estimation, and development of project
alternatives.

Key Strategies & Objectives:
o Participate in formal Continuous Process Improvement (CPI) efforts as opportunities present
themselves. Support staff participation as LEAN specialists if selected. Update list of initiatives for
formal and informal process improvement.
o Establish final program budget, scope, and schedule for NorthSTAR program; continue design
progress; keep Alaska Airlines involved as outlined in April 2012 Letter of Understanding.
o Support Aviation Division development of EX-15 procedure.
o Use NorthSTAR project to help develop new format standard specifications. Contribute other ideas
for master spec updates based on project experiences.
VII-2
Port of Seattle
Capital Development
o
o
o
2013 Budget and Business Plan
Increase utilization of SharePoint on projects; continue to develop expertise; push/support use.
Increase training of staff in emergency preparedness and response/recovery. Participate in CDD
efforts such as damage assessment drills and airport seismic review.
Develop Lessons Learned detailing expectations, roles and responsibilities, and steps in project when
must be done. Use central storage location and consistent format to facilitate searching.
CENTRAL PROCUREMENT OFFICE (CPO):

Key Functions & Responsibilities:
o Manage the procurement process for all construction contracts, professional and personal service
contracts, and goods and service contracts to ensure compliance with legal mandates.
o Review construction change orders to ensure compliance with contract provisions, adequate content
and procedural compliance; execute change orders.
o Review service agreement amendments and service directives to ensure compliance with contract
provisions. Assist in drafting amendments when appropriate.
o Draft amendments for goods and service contracts.
o Close out contracts, ensuring that all closing submittals have been received.
o Provide notification to Commission, with respect to public works contracting, as required to be in
compliance with state law and Resolution 3605.
o Provide outreach and work with Office of Social Responsibility in developing appropriate small
business programs and opportunities.
o Provide advice and assistance for the administration of all Port contracts.

Key Strategies & Objectives:
o Implement improvements to Port negotiation strategy. Provide assistance to RDR (Requesting
Department Representative) during negotiations, including billing rate analysis. Develop and
maintain a billing rate database. Develop and provide training on negotiation strategies.
o Finalize revisions to Service Agreement Terms and Conditions for professional services.
o Revise construction contract general terms (Section 00700) and supplementary terms (Section
00800). Combined effort with the Port’s Engineering and the Association of General Contractors.
Request review from Utility Contractors (UCA) and Mechanical Contractors (MCA).
o Continue a task force to review purchasing procedures and processes and identify areas to improve
efficiency and effectiveness. Develop additional tools and review current tools and policies if
appropriate. Provide outreach/training.
o Identify additional processes for Continuous Process Improvement. Work with Process Improvement
Manager to plan and execute one or more accelerated workshops.
ENGINEERING:

Key Functions & Responsibilities:
o In-house project Design and technical support.
 Civil/Structural and Mechanical/Electrical design, analysis and CAD drafting.
 Seismic risk analysis and condition assessment of facilities.
 Central repository for all project drawings, as-built and soils information.
 Maintain technical master specifications.
 Quality Assurance/Quality Control/Quality review.
o Construction Management for all major construction projects and tenant construction oversight.
 Field observation/inspection and quality compliance checks.
 Change order management, disputes and claims resolution.
 Constructability reviews.
 Development of Division 1 major construction contract provisions.
 Construction coordination with Port operations/tenants.
VII-3
Port of Seattle
Capital Development
o
o
o
o

2013 Budget and Business Plan
 Construction document management through LiveLink system.
Construction safety compliance for all construction projects and provides orientation training.
Surveying and Mapping of all Port properties.
 Topographic and hydrographic surveys.
 Legal descriptions and lease line layouts.
 Utility locates/mapping and aerial mapping
 GIS data gathering.
 BIM survey data.
Administration of Engineering assets/Admin Services.
 Engineering fleet management, equipment and logistics support.
 Budget preparation, monitoring and reporting.
 Purchasing and Procurement, General administrative services for EN staff.
Emergency Response and Declaration of Emergency Support.
Key Strategies & Objectives:
o Continue participation and provide leadership in the Capital Projects Advisory Review Board
(CPARB) legislative committee and sub-committees for government agencies contracting laws and
procedures. Bob Maruska is the Chair for CPARB and Janice Zahn participates with the subcommittee on contracting methods.
o Identify and train key emergency response representatives for CDD and initiate exercises. Continue
expanded training of key CDD staff for better Emergency Response capabilities. This included
training in FEMA courses to better prepare staff to function within the standard operating procedures
of the national emergency response community.
o Update Master specs. Revise General Conditions (Documents 00700 and 00800) in collaboration
with Legal and CPO. Team with other departments and lead the efforts to update the technical master
specifications.
o Update QA/QC review. Work with project management and operating divisions to update the project
review process and documentation.
o Update Construction Management Standard Operating Procedures manual. Update remaining SPOs,
create QA/QC SPO and continue creation of Closeout SPO.
o Leverage technology with the use of iphones, ipads to reduce travel between various work locations,
improve inspector report quality with less dependence on office locations to perform job functions.
Pursue the use of OneNote and video-teleconferencing for team collaboration. Admin SharePoint site
will evolve to add processes and procedures.
o Upgrade our utility and surface feature base maps to be compatible with 2013 AutoCAD Civil 3D.
o Implement FEMA structural risk methodology to assess Aviation facilities and prioritize needs for
retrofit.
o Incorporate construction cost trending as part of PMG rollout of Skire/Unifier adoption.
o Continue to meet with representatives of the Pilots Association, Office of Emergency management
(EOC) and National Oceanic and Atmospheric Administration (NOAA) to discuss issues and
concerns with hydrographic surveys and metrics. Garry Ensley is the point of contact for the Port.
o Continue initiative with Information and Communications Technology (ICT) to select and
implement a replacement for current construction document management system (LiveLink).
PORT CONSTRUCTION SERVICES (PCS):

Key Functions & Responsibilities:
o Provide construction and construction management services to the operating divisions in the most
cost effective manner possible.
o The Regulated Materials Management Program (RMM) supports construction by performing
necessary and required regulated building material surveys prior to construction.
o Provide on-call emergency response.
VII-4
Port of Seattle
Capital Development

2013 Budget and Business Plan
Key Strategies & Objectives:
o Replace AIMS database with SharePoint and GIS. Geographical surveys will be used in conjunction
with SharePoint to track RMM surveys at Aviation, Seaport and Real Estate.
o Work with ICT to continue upgrades to PCS Project Management Information System for improved
performance on purchase orders, estimating and close-out forms.
SEAPORT PROJECT MANAGEMENT GROUP (SPM):

Key Functions & Responsibilities:
o Capital project delivery.
o Expense project delivery.
o Provide support to Seaport and Real Estate Divisions.
o Provide support to the Capital Development Division.
o Emergency response preparedness.

Key Strategies & Objectives:
o Identify processes for Continuous Process Improvement (CPI).
o Support team members who show skills and desire to be Continuous Process Improvement (CPI)
facilitators.
o Conduct training for all team members and place designated projects and all new projects in new
Project Delivery System.
o Support port-wide, Seaport and Real Estate division Emergency Management initiatives and
strengthen CDD and SPM capabilities in support of response and recovery.
o Continue documentation of project management processes. Build upon work completed in 2012;
identify and improve at least one procedure monthly.
KEY PERFORMANCE INDICATORS/MEASURES:









Construction Project Soft Costs: Limit construction soft costs (design, construction management, project
management, environmental documentation, allocated overhead) to no more than 25% of total capital
and major expense project costs.
Cost Growth During Construction: Limit average major construction contract cost growth to 10% of
award amount.
Project Schedule: Limit time growth from initial Commission capital or expense project authorization to
construction contract award to no more than 10% of originally scheduled and then from award to
substantially complete to no more than 10% of originally scheduled.
Small Business Participation: 60% of small works contracts; 20% of major construction contracts; 10%
of service agreements and 20% of purchases, per SBA size standards. Continue to implement Small
Contractor and Supplier program.
Customer Score Card: 100% of projects surveyed. Average 85% of total possible points on project
customer feedback scorecards returned.
Environmental: Incorporate Executive Policy and Procedure 15 (Sustainable Asset Management) and/or
LEED process in every project.
Safety: Score an average of 90 out of a possible 100 points on CDD organizational Safety Program
Evaluations. Limit annual contractor workplace injury rates to 6 recordable accidents and 2 time lost
accidents per 200,000 hours worked.
Performance Evaluation timeliness: Complete and submit 98% of performance reviews by 30 days after
end of rating period.
Procurement Timeliness: Improve average time to award and accomplish contract awards within agreed
timeframes.
VII-5
Port of Seattle
Capital Development
2013 Budget and Business Plan
D. CAPITAL DEVELOPMENT DIVISION BUDGET SUMMARY
The following Tables VII-2 & VII-3 and Figures VII-1 & VII-2 illustrate the expenses for Capital
Development Division by department and by account:
TABLE VII-2: CAPITAL DEVELOPMENT EXPENSE BY DEPARTMENT
($ in 000's)
2011
Actual
BY DEPARTMENT
2012
Budget
Notes
EXPENSES BEFORE CHARGES TO CAP/GOVT/ENVRS PROJECTS
Capital Development Administration
$
351
Central Procurement Office
3,852
Engineering
12,638
Port Construction Services
7,262
Project Management Group - Aviation
6,583
Project Management Group - Seaport
2,404
Total Expenses Before Charges to Cap/Govt/Envrs Projects
33,091
CHARGES TO CAPITAL/GOVT/ENVRS PROJECTS
$
(22,065)
OPERATING & MAINTENANCE EXPENSE
Capital Development Administration
Central Procurement Office
Engineering
Port Construction Services
Project Management Group - Aviation
Project Management Group - Seaport
Total Operating Expenses
351
2,342
3,287
2,416
1,424
1,207
$ 11,026
$
374
4,481
14,217
6,791
7,731
2,987
36,581
2013
Budget
$
% Change
2013 Bud2012 Bud
382
4,532
14,904
6,618
8,710
3,841
38,988
2.1%
1.1%
4.8%
-2.5%
12.7%
28.6%
6.6%
(21,066)
(24,208)
14.9%
374
3,151
4,460
3,479
2,502
1,550
15,516
382
3,001
4,229
2,266
2,532
2,370
14,780
2.1%
-4.8%
-5.2%
-34.9%
1.2%
52.9%
-4.7%
$
capdevbud.xls
FIGURE VII-1: CAPITAL DEVELOPMENT EXPENSE BY DEPARTMENT
($ in 000’s)
Project Management
Group - Seaport, 16.0%
Capital Development
Administration, 2.6%
Central Procurement
Office, 20.3%
Project Management
Group - Aviation
17.1%
Port Construction
Services, 15.3%
Engineering , 28.6%
Total Expense: $14,780
VII-6
Port of Seattle
Capital Development
2013 Budget and Business Plan
TABLE VII-3: REVENUES AND EXPENSES BY ACCOUNT
($ in 000's)
BY ACCOUNT
2011
Actual
Notes
Revenue
Other Revenue
Total Revenue
$
79
79
2012
Budget
$
-
2013
Budget
$
-
Expense
Salaries, Wages, Benefits & Workers Compensation
Equipment Expense
Utilities
Supplies & Stock
Outside Services
Travel & Other Employee Expenses
Promotional Expenses
Other
Total O&M
25,976
295
86
346
5,874
219
0
294
33,091
29,589
680
70
293
5,215
434
2
298
36,581
31,118
505
73
380
6,097
503
0
312
38,988
Charges to Capital/Govt/Envrs Projects
(22,065)
(21,066)
(24,208)
Total Expense
$ 11,026
$ 15,516
$ 14,780
% Change
2013 Bud2012 Bud
0.0%
0.0%
5.2%
-25.7%
4.3%
29.7%
16.9%
15.9%
-100.0%
4.7%
6.6%
14.9%
-4.7%
capdevbud.xls
FIGURE VII-2: CAPITAL DEVELOPMENT EXPENSE BY ACCOUNT
($ in 000’s)
Travel & Other Employee
Expenses
1.3%
Supplies & Stock
1.0%
Utilities
0.2%
Equipment Expense
1.3%
Promotional Expenses
0%
Other
0.8%
Outside Services
15.6%
Salaries, Wages, Benefits
& Workers
Compensation
79.8%
Total Before Charges to Capital/Govt/Envrs Projects: $38,988
Charges to Capital/Govt/Envrs Projects: $24,208
Total Expense: $14,780
VII-7
Port of Seattle
Capital Development
2013 Budget and Business Plan
E. STAFFING
The following TABLE VII-4 depicts the proposed staffing requirements for 2013 by department for the
Capital Development Division: Capital Development is budgeting 265.5 positions, which is 9.7 more than
2012 budget.
TABLE VII-4: CAPITAL DEVELOPMENT DIVISION STAFFING
STAFFING
(Full-Time Equivalent Positions)
BY DEPARTMENT
Capital Development Administration
Central Procurement Office
Engineering
Port Construction Services
Aviation Project Management
Seaport Project Management
TOTAL CAPITAL DIVISION
2011
Actual
2.0
37.0
110.5
54.0
44.0
17.0
264.5
Notes
1
2
3
2012
2012
Budget
Est. Act.
2.0
2.0
37.0
37.0
108.8
108.8
47.0
47.0
44.0
44.0
17.0
17.0
255.8
255.8
2013
Budget
2.0
37.0
111.5
50.0
48.0
17.0
265.5
% Change
2013 Bud 2012 Bud
0.0%
0.0%
2.5%
6.4%
9.1%
0.0%
3.8%
FTE.XLS
Notes:
1) Engineering added 3 Construction positions and eliminated a .25 College Intern.
2) Port Construction Services added 3 temporary Construction positions.
3) Aviation Project Management added 4 Capital Project Managers.
F. CAPITAL BUDGET
Please see Corporate section, VIII – F, for Capital Development Capital Budget information.
G. CAPITAL DEVELOPMENT DIVISION SUMMARY
TABLE VII-5: CAPITAL DEVELOPMENT DIVISION SUMMARY
2012
($ in 000's)
OPERATING BUDGET
Actual
2011
Notes
Operating Revenue
$
Operating Expense
Total Operating Expense
TOTAL FTEs
79
$
11,026
11,026
Income from Operations
CAPITAL SPENDING
Budget
1
Forecast
-
$
15,516
15,516
-
$
15,593
15,593
$
(10,947) $
(15,516) $
(15,593) $
$
480
398
436
$
264.5
255.8
$
Growth
2013 Bud2012 Bud
Budget
2013
255.8
$
-
NA
14,780
14,780
-4.7%
-4.7%
(14,780)
-4.7%
742
265.5
86.4%
3.8%
capdevhist.xls
Notes:
1) See Table VIII-5, Corporate section for total capital growth from 2013-2017.
See Section X for details of Capital Budget.
VII-8
Port of Seattle
Corporate
2013 Budget and Business Plan
CORPORATE
A. 2013 BUDGET SUMMARY
TABLE VIII-1: 2013 BUDGET SUMMARY
($ in 000's)
OPERATING RESULTS
Change
Notes
Other Revenue
$
EMPLOYMENT (TOTAL FTEs)
1,559
$
151
155
1,559
151
71,418
71,418
2013 Bud- 2013 Bud2012 Bud
4
2.6%
76,535
78,807
2,272
3.0%
76,535
78,807
2,272
3.0%
$ (69,859) $ (76,384) $ (78,652) $
(2,268)
3.0%
$
(2,663)
-23.1%
(3.0)
-0.7%
3,920
$ 11,524
449.8
452.2
$
8,861
449.2
$
2012 Bud
155
Total Corporate Expense
1
2013
Budget
2.6%
Corporate
COMMITTED CAPITAL BUDGET
2012
Budget
4
Total Revenue
Excess of Revenue over Expense
2011
Actual
% Change
$
admsum.xls
Notes:
1) See Section X for details of Capital Budget.
B. MISSION:
Corporate will provide high quality and cost-effective professional and technical services to the operating
divisions and support the overall goals of the Port.
C. KEY FUNCTIONS & STRATEGIES
OVERVIEW:
The three operating divisions of the Port are supported by a number of functional departments as well as service
groups. These functional and service groups allocate their expenses according to the level of service they
provide to the divisions.
Many of the Corporate departments are vital to the success of the divisions for providing essential services such
as accounting, legal services, computer support, etc. These services also benefit the public in general and play
an indirect role in the success of the divisions.
The major initiatives and service plans for the Corporate departments in 2013 are:
COMMISSION:
Set and support CEO performance goals and objectives. These include policy goals and objectives related to
achieving the Port’s financial and budgetary annual performance, and aligning budget priorities to the Port’s core
mission, division goals and objectives that demonstrate the CEO is holding his direct report managers
accountable for division-level performance.
VIII-1
Port of Seattle
Corporate

2013 Budget and Business Plan
Key Strategies & Objectives:
Over the next 25 years we will add 100,000 jobs through economic growth led by the Port of Seattle for a
total of 300,000 port-related jobs in the region, while reducing our environmental footprint. In order to
accomplish this we will:
o Position the Puget Sound region as a premier international logistics hub.
o Grow seaport annual container volume to more than 3.5 million TEUs.
o Structure our relationship with Washington ports to optimize infrastructure investments and financial
returns.
o Triple air cargo volume to 750,000 metric tons.
o Triple the value of our outbound cargo to over $50 billion.
o Double the economic value of the fishing and maritime cluster.
o Advance this region as a leading tourism destination and business gateway.
o Make Sea-Tac Airport the west coast “Gateway of Choice” for international travel.
o Double the number of international flights and destinations.
o Meet the region’s air transportation needs at Sea-Tac Airport for the next 25 years.
o Double the economic value of cruise traffic to Washington state.
o Use our influence as an institution to promote small business growth and workforce development.
o Increase the proportion of funds spent by the Port with qualified small businesses firms on construction,
goods and services to 25% of the eligible dollars spent.
o Increase work force training, job and business opportunities for local communities in trade, travel and
logistics.
o Be the greenest and most energy efficient port in North America.
o Meet all increased energy needs through conservation and renewable sources.
o Meet or exceed agency requirements for storm water leaving Port owned or operated facilities.
o Reduce air pollutants and carbon emissions, specifically:
 Reduce air pollutant emissions by 50% from 2005 levels
 Reduce carbon emissions from all Port operations by 50% from 2005 levels and reduce aircraftrelated carbon emissions at Sea-Tac by 25%
o Anchor the Puget Sound urban-industrial land use to prevent sprawl in less developed areas.
o Restore, create, and enhance 40 additional acres of habitat in the Green/Duwamish watershed and Elliott
Bay.
EXECUTIVE:
Achieve the operating and performance goals and objectives set by the Commission. Oversee the achievement of
all divisions’ major goals and initiatives.
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Key Strategies & Objectives:
o Achieve budgeted net operating income before depreciation.
o Develop an action plan and initiate the roll-out for the first 5 year milestones of the Century Agenda.
o As “game changing” events alter the competitive nature of the seaport industry, develop alternative
strategies and initiate state level dialogue about how to achieve a fair return on public investment.
o As the Environmental Protection Agency and the Department of Ecology determine the final Duwamish
Waterway clean-up alternative, initiate funding allocation process with partners and develop an
appropriate financing plan.
o Draft and complete contractual Memorandum of Understanding with the Washington State Department
of Transportation for the Port’s contributions to the Alaskan Way Viaduct and Seawall replacement
programs.
o Complete resale of portions of Eastside Rail Corridor.
o Build constituency of public, Administration, and Congressional support, and develop/circulate draft
legislation to eliminate the “land border loophole” that enables some shippers to divert U.S.-destined
cargo to Canadian and/or Mexican ports and avoid the Harbor Maintenance Tax.
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Improve Port-wide operational efficiencies by continuing the multiple-year program of establishing
metrics to measure performance, implementing continuous process improvements (LEAN), and
validating best practices.
LEGAL:
Legal department has three major areas of functions: Attorney Services, Record Management, and Workplace
Responsibility.
ATTORNEY SERVICES
Provide legal analysis, advice, expertise, opinions and similar services, including: drafting, review and
interpretation of contracts, agreements, statutes, regulations, judicial opinions and other legal materials and
documents; prosecution and defense of claims and litigation; assistance with settlements and negotiations;
representation in arbitration, mediations and other forms of dispute resolution; representation before hearings
boards and other administrative or legislative bodies. Receive and manage reported violations and monitor
workplace investigations and outcomes.
RECORDS MANAGEMENT
Manage and provide public record administration, including public disclosure. Provide Portwide assistance with
regard to records management issues including retention scheduling, archiving and public disclosure. Manage
Port records in accordance with State retention requirements.
WORKPLACE RESPONSIBILITY
Provide overall leadership and coordination of the Port’s workplace ethics and compliance activities. Coordinate
policy development and implementation. Provide information, guidance, training, and ethics-related legal
analysis, advice and counsel.
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Key Strategies & Objectives:
o Attorney Services: Support the business needs of the operating divisions.
o Records Management: Provide public record administration.
o Workplace Responsibility: Support the Port’s attainment of business objectives in a manner that is
consistent with our values and the highest standards of business ethics and workplace behavior.
Prevention of, preparation for, detection of and response to violations of the Port’s Code of Conduct and
other legal or policy expectations.
RISK MANAGEMENT:
Oversee and manage the cost of risk to the Port (measured in risk costs/$1000 of revenue) while minimizing
exposure to catastrophic loss. Provide services in claims management, contractual risk analysis, risk assessment,
risk financing, insurance purchasing and emergency preparedness in 2013. Areas of focus will be self-funding
for employee benefits, enterprise risk management, risk financing, claims management, fleet management,
contractual reviews, special events risk management, construction safety, and the driver safety program,
including managing the drug testing requirements for commercial driver license holders.
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Key Strategies & Objectives:
o Maintain cost effective property and liability insurance for the Port.
o Collaborate on special projects in which there is a risk trade off with the project benefits and to provide
insight and analysis.
o Proactively manage claims in accordance with the Port’s Resolution and Policy EX-7.
o Manage the driver safety program and ensure the Port’s policies and procedures are sufficient to reduce
liability exposures from the business use of Port vehicles and other fleet equipment.
HEALTH & SAFETY:
Provide health and safety and Workers Comp services and expertise to enable customers to achieve the Port's
zero-based health and safety goals (zero accidents, injuries, lost workdays, Workers Comp claims and regulatory
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citations and fines), and the substantial morale, productivity and financial benefits that accrue from achieving
those goals. Promote employee health improvement through wellness program offerings.
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Key Strategies & Objectives:
o Collaborate on safe work practices and promote a healthy work force through a variety of intervention
programs and services.
o Continuous improvement process - develop organization specific safety action plans based on
deficiencies noted on the respective organization’s annual safety evaluation.
o Provide an aggressive return to work program to minimize worker compensation expense and reduce lost
workdays.
PUBLIC AFFAIRS:
Public Affairs includes a number of key functions/programs: media relations, federal government relations,
state government relations, local government relations, regional transportation, business and corporate
communications, community outreach, and tourism development.
MEDIA RELATIONS
 Produce proactive, thoughtful communication pieces that demonstrate the port’s leadership in areas such as
trade, environmental initiatives, and business competitiveness.
 Develop media strategies and relationships throughout all areas of contemporary media, produce press
releases and statements, media plans and arranges interviews, opinion editorials, etc. with the ultimate goal
of achieving understanding and support for the Port, its operations and policy positions.
 Enhance public understanding through a variety of targeted media outlets (including social media) about the
port’s mission as a job-generator and environmental leader in the three operating divisions.
 Highlights the port’s role as a leader in social responsibility by informing reporters and media outlets
(through one-on-one interviews, press releases, opinion editorials, press tours) about programs that promote
economic opportunities for all citizens of King County.
 Develops, manages and executes media plans for crisis communications for all operating divisions.
 Develops and maintains strong working relationships with reporters, editors, special publication/blog writers
both proactively and reactively (as appropriate), working to ensure accuracy in stories about the port.
 On-call 24/7 to respond to media inquiries for breaking news.
COMMUNITY ENGAGEMENT
 Manage the port’s reputation and “license to operate” through proactive and strategic relationship building
with the Port’s “fence line” communities.
 Work collaboratively with Port businesses (airport, seaport, real estate) to develop and execute community
engagement and communications strategies.
 Proactively identify opportunities for Commissioners and senior port staff to interact (through speeches,
attending meetings, participating in discussions, etc.) with key community stakeholders and fence line
neighbors.
 Develop and maintain productive working relationships with key stakeholder groups, and business and
industry leaders.
 Build understanding of the Port’s goals, business strategies and overall importance to the regional economy
through strategic outreach, collateral materials, website information, tours/information sessions for
international visitors, students, visiting dignitaries, key business partners, customers, and elected officials
and policy staff.
FEDERAL GOVERNMENT RELATIONS
 Communicate the port’s transportation and trade priorities to representatives from U.S. federal cabinet
agencies, the state Congressional Delegation, and associations of which we are a member.
 Strengthen relationships with Congressional and federal agencies by educating key policy makers on Port of
Seattle’s business and operations.
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Continue to advocate for federal legislation to address the inequities of the Harbor Maintenance Tax and
advance a policy that addresses cargo diversion and levels the playing field; continue to raise awareness and
build a coalition to support the effort.
Continue to work to advance a US Army Corps of Engineers study of deepening the East and West
Duwamish Waterways.
Continue to promote US West Coast Collaboration efforts; contribute/lead USWCC government relations
efforts to ensure activity reflect POS priorities.
STATE GOVERNMENT RELATIONS
 Communicate the port’s business, transportation and trade priorities to state elected officials, executive
branch and state government agencies.
 Foster effective relationships between port elected officials and senior port staff with state elected officials
and executives of state agencies to advance the port’s objectives.
 Develop partnerships with stakeholders in business, labor and communities organizations also engaged in
state issues in support of infrastructure investment, trade development and economic growth.
 Coordinate state priorities with the statewide ports association staff and with port commissioners and staff
around the state.
 Continue to advocate for policies and regulations that support, enhance and expand the ability of the port and
related businesses to operate effectively in the state and to move people and commerce efficiently in a
competitive global marketplace.
LOCAL GOVERNMENT RELATIONS
 Communicate the port’s business, transportation and trade priorities to local and regional government
agencies.
 Foster effective relationships between port elected officials and senior port staff with elected officials and
executives of local and regional governments to advance the port’s objectives.
 Develop partnerships with stakeholders in business, labor and community organizations in support of trade
development and environmental programs.
 Coordinate program-level relations with WSDOT on Alaskan Way Viaduct and Seawall Replacement
projects.
 Continue to advocate for policies and regulations that enhance and expand the ability of the port and related
businesses to move people and commerce efficiently in a competitive global marketplace.
REGIONAL TRANSPORTATION
 Focus transportation policy analysis and strategies to support funding and freight mobility at local, regional,
state and federal levels.
 Coordinate/collaborate with local jurisdictions, customers, stakeholders and other interested parties to ensure
continued access to Port facilities
 Advocate/protect access to Port facilities through projects such as the Alaskan Way Viaduct Replacement
Program (AWVRP), Alaskan Way Seawall, Waterfront Seattle, Mercer Corridor, SR509 Completion, Sound
Transit Link Light Rail Airport extension, Seattle Freight Access study and the FAST Corridor.
 Advance partnerships for the Pacific Northwest Gateway Corridor Coalition.
BUSINESS AND CORPORATE COMMUNICATIONS
 Develop messages and content that serves the needs of port leaders, internal communication strategies,
public information programs and issue response.
 Create and maintain strong integrated communication strategies that meet the needs of our customers,
tenants, business partners, employees and community using an appropriate mix of media tools and options.
 Define, manage and communicate the port brand through consistent graphics, messaging, tone and quality,
and developing guidelines and requirements for design and production of port advertising, marketing and
communication products.
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COMMUNITY OUTREACH
 Deliver programs, events and communications that maintain the port’s license to operate and support
business objectives such as: Northwest Ports Clean Air Strategy update; Drayage Trucks RFID; new airport
and seaport customers/service; and the opening of new facilities.
 Strengthen strategic relationships within “fence line” communities such as Duwamish Valley neighborhoods
to support clean air/Superfund projects; and North Harbor neighborhoods to update on cruise, uplands
development and tank farm cleanup.
 Develop targeted outreach opportunities for Commissioners and Executives to engage with area leaders on
Century Agenda.
 Engage new audiences through public education events such as SeaAir “Teach the Teachers” School, Port
101 and Working Waterfront Tours.
TOURISM DEVELOPMENT
 Develop and implement growth strategies and plans in current and emerging markets to increase the
economic impact of tourism and related services.
 Promote international tourism to Seattle, the region and state from markets in China, the United Kingdom,
Japan, France and Germany in partnership with the Seattle’s Convention & Visitors Bureau and with
industry partners across the state.
 Leverage the cruise program with pre and post tour options to increase economic impact through tourism.
 Continue leadership in the Washington Tourism Alliance to develop long term funding for a statewide
tourism presence both domestic and international.
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Key Strategies & Objectives:
MEDIA RELATIONS
o Continue the communication efforts related to the Century Agenda strategic planning process. Continue
the social media efforts to promote the Agenda. Communication/community engagement and outreach
will be closely aligned on key messages.
o Provide regular communications via social and mainstream media for the AWVSRP construction
updates.
o Provide communications and media support to several environmental and business initiatives: airline
realignment, completion of the pre-conditioned air project; rollout of electrified ground support
equipment at Sea-Tac; and ongoing efforts to promote Seattle as the Green Gateway for trade and travel.
FEDERAL GOVERNMENT RELATIONS
o Work collaboratively with Port businesses (airport, seaport, real estate) to develop legislative funding
and policy priorities.
o Leverage memberships in key associations to broaden political support for Port of Seattle federal
priorities.
o Provide opportunities for key policy makers and Congressional delegation staff to learn about Port of
Seattle’s business and operations through tours and briefings.
o Advocate in Congress for reforms to the Harbor Maintenance Tax that address cargo diversion and levels
the playing field, while being WTO and GATT compliant.
o Provide a path for timely approval of the US Army Corps of Engineers study of deepening the East and
West Duwamish Waterways.
o Work regionally to positively influence the new national freight policy and roadmap.
STATE GOVERNMENT RELATIONS
o Work with Commissioners, the CEO and senior staff to develop legislative and policy strategies for state
government.
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Work collaboratively with Port businesses (airport, seaport, real estate) to develop support and advocacy
for policy priorities.
Work with the Legislature, executive branch and agency staff to gain support for port priorities and
securing legislative action on bills and policies affecting the port.
Manage the priorities and agendas of the statewide ports association to broaden political support for Port
of Seattle growth and priorities.
Provide opportunities for key policy makers and legislative staff to learn about Port of Seattle’s business
and operations through tours and briefings.
Advocate for funding for freight-mobility projects to maintain the port’s competitive position.
Engage in legislative policy and regulatory development for transportation and environmental issues that
advance the port’s business objectives and our environmental leadership.
LOCAL GOVERNMENT RELATIONS
o Work with Commissioners, the CEO and senior staff to develop legislative and policy strategies.
o Create opportunities for local elected officials and community leaders to observe port operations to
foster better understanding of our goals and objectives.
o Advocate for funding for local and regional freight-mobility projects to maintain the port’s competitive
position.
o Support regulatory policies for industrial-land protection, shorelines management, stormwater control
and environmental clean-up that advance the port’s business objectives and our environmental
leadership.
o Support design of new Alaskan Way surface street that meets port freight-mobility objectives.
REGIONAL TRANSPORTATION
o Work to help Port businesses achieve their business goals and results by serving as “a catalyst for
transportation solutions.”
o Provide project planning, management and funding, transportation policy advocacy, and synthesis of a
focused, Port-wide transportation strategy.
o Business goals drive transportation access and freight mobility improvements to accommodate maritime,
trade, travel and tourism.
o Other drivers are derived from the CEO’s goals for the Alaskan Way Viaduct and Eastside Rail Corridor.
o Key 2013 programs and projects include Alaskan Way Viaduct Replacement Program, Seawall and
Waterfront Seattle, Pacific NW Gateway Corridor Coalition, Mercer Corridor, SR509 Completion,
Sound Transit Link Light Rail Airport extension, Seattle Freight Access study and the FAST Corridor.
BUSINESS AND CORPORATE COMMUNICATIONS
o Communicate the Century Agenda strategic plan for the port via employee communications and forums
at the port, and via the public website and electronic publications.
o Transition the centennial website to a history site and continuing asset for the port.
o Improve the public website for greater support of issue management.
o Support departmental communications needs with strategic counsel, planning and execution; promote
Public Affairs’ team approach in support of business needs and goals.
o Upgrade and support social media development and integration with port communication products by
engaging and building team participation.
o Support and promote development of values-driven organization by continued brand development,
internal communications and events.
o Strengthen video communications through creative thinking, cross-promotion, employee engagement
and efficient use of resources.
COMMUNITY OUTREACH
o Manage the port’s reputation and “license to operate” through proactive and strategic relationship
building with the Port’s “fence line” communities including north and south harbor neighborhoods.
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Work collaboratively with Port businesses (airport, seaport, real estate) to develop and execute
community engagement and communications strategies around the Northwest Ports Clean Air Strategy
and the implementation of RFID for trucks.
Proactively identify opportunities for Commissioners and senior port staff to interact (through speeches,
attending meetings, participating in discussions, etc.) with key community stakeholders and fence line
neighbors.
Develop and maintain productive working relationships with key stakeholder groups, and business and
industry leaders such as local Chambers, business associations, King County Maritime and the
Manufacturing Industrial Council.
Build understanding of the Port’s goals, business strategies and overall importance to the regional
economy through strategic outreach, collateral materials, website information, tours/information sessions
for visiting elected officials and policy staff.
Develop a new SeaAir educational offering for the teaching community.
Support Commission on Century Agenda outreach events, activities and strategic partner coordination.
Support the formation of a Washington Maritime Partnership that brings together a broad coalition of
interests to support the vitality of the region’s maritime interests.
Collaborate with various regulatory agencies around Lower Duwamish Superfund cleanup community
involvement activities.
TOURISM DEVELOPMENT
o Manage the Port’s interest in the Washington Tourism Alliance with regard to long term funding of
tourism and implementation of a statewide tourism strategy.
o Develop a “Cruise Plus” strategy for select international markets that increases overnight stays in Seattle
as well as short term visits to other parts of the state.
o Participate in the Brand USA “Land of Dreams” promotion developed by the US Travel Organization in
the target markets of the United Kingdom and Japan in order to increase traffic from the top two
international, overseas markets to Washington State.
o Continue to develop tourism products and visibility in overseas markets: UK, France, Germany, Japan
and China.
HUMAN RESOURCES AND DEVELOPMENT:
Human Resources and Development (HRD) engages and equips employees to achieve exceptional results. Key
responsibilities include:
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Employment services including strategic recruitment advice and management of selection and hiring
processes. Manage special programs related to recruitment such as the Veterans Fellowship Program and
High School, College, and Graduate Intern programs. Provide community outreach related to recruitment.
Management of Total Rewards programs consistent with the Total Rewards philosophy as well as port goals
and objectives.
Employee relations, including investigation and resolution of employee complaints; guidance for managers
and non-managers on a range of issues including performance management, reasonable accommodations,
resolution of employee relations issues; managing related record keeping; managing Port responses to
employee complaints filed with external agencies and participation in the Work Place Responsibility intake
process.
Development of Port-wide diversity strategies.
Learning and Leadership planning, programs and oversight for Port; design, implementation of specific
classes and programs related to employee and leader development and administration of Learning
Management System (LMS).
Organizational development services (e.g., strategic planning, facilitation, organizational design, process
redesign, metrics, job design etc.) to wide range of Port departments and enterprise-wide initiatives.
Coaching and consulting for managers and non-managers on a wide range of human resource issues
including employee relations, staffing, career development, legal compliance, Performance Review,
Evaluation, and Planning (PREP) protocols, pay and best practices, etc.
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Act as systems administrators of HCM systems and maintenance of accurate employee records within the
system; analysis of available HR data for purposes of measuring effectiveness of HR strategies and progress
and to provide a basis for workforce planning.
Employee communication regarding a wide range of human resource issues including policy, programs, total
rewards, class offerings, etc.
Development, maintenance and education about HRD policies.
Assuring compliance with a range of local, state and Federal laws related to hiring, employment, and Total
Rewards.
Coordination with Workplace Responsibility Office on a range of issues including policy administration,
education, communication and investigation and resolution of employee complaints.
Data gathering, analysis and costing to support collective bargaining processes.
Key Strategies & Objectives:
o Develop a more agile, cross-functionally knowledgeable HRD staff.
o Advance the use of technology to conduct HRD business.
o Continually improve HRD core processes.
o Establish shared accountability for mutual success between HRD and our customers.
o Further integrate development and diversity principles into Port culture.
o Support the expansion of a data driven CPI culture.
o Develop and attract a qualified pool of candidates to meet changing organizational needs.
o Facilitate excellent individual and team performance throughout the organization.
o Deliver a meaningful Total Rewards package aligned with an articulated Total Rewards Philosophy.
LABOR RELATIONS:
Promote a High Performance Organization among represented employees through continuous education,
employee development and employee recognition programs. Negotiates and administer all the Collective
Bargaining Agreements for the represented employees.
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Key Strategies & Objectives:
o Foster open communication which explores shared interests and values, and enhances the cooperation
and trust between the Port, its represented employees, and organized labor.
o Invite and internally communicate the views of organized labor concerning Port capital improvements,
service changes, and economic development projects and plans.
o Negotiate and administer contracts, which foster these relationships, maintain the Port as an
economically sustainable agency, maintain internal equity of wages and benefits and establish the Port as
an employer of choice.
o Utilize, where appropriate to the nature and scope of the project, Project Labor Agreements in Port
construction programs in order to provide labor harmony, promote best labor practices, provide
apprenticeship opportunities and provide opportunities to small contractors.
o Encourage and assist Port management to identify areas for mutual gain between the Port and organized
labor when engaged in business planning.
o Research, evaluate and, where appropriate, implement best practices in the field of labor relations.
INFORMATION AND COMMUNICATIONS TECHNOLOGY (ICT):
Provide reliable, high-quality, cost-effective enterprise-wide infrastructure, hardware, applications, and
technology services to support the Divisions and the Port’s strategies. Support several core Port-wide service
requirements. Key responsibilities and services focus on effectively administering and managing the Port’s
enterprise Information and Communications Technology systems, services, and resources in the most cost
effective manner.
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Key Strategies & Objectives:
o Maintain systems operations 24/7 in a safe, secure, cost effective, collaborative and sustainable manner:
1. Ensure high reliability and availability of all systems.
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Implement systems redundancy and validate Disaster Recovery plans.
Maintain and refresh technology assets to maximize value and minimize total cost of ownership.
Ensure strong financial management.
Provide outstanding customer service to our business partners.
Ensure compliance with regulatory and legal requirements.
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Evaluate and deliver new technology solutions that fulfill business needs and enhance business
processes, efficiently and effectively:
1. Partner with business leaders to ensure appropriate focus on critical business needs.
2. Deliver projects within budget and schedule expectations using repeatable processes.
3. Develop agile, highly skilled, and diverse work force to operate in dynamic environment with
constantly changing needs.
4. Provide architectural leadership and standards.
5. Virtualize and optimize our infrastructure to ensure sustainability, growth capacity, and agility.
6. Provide innovative solutions to business problems through leadership and focus on emerging
technologies.
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Enable business processes and enterprise communications to promote collaboration and provide access
to information when and where it is needed:
1. Promote mobility solutions.
2. Promote transparent communications and collaboration.
3. Enable employees to telecommute.
4. Enable emergency communications.
5. Ensure system access is appropriately provided.
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Ensure confidentiality and integrity of data and information systems:
1. Create and maintain an Information Systems and Security Policy framework.
2. Educate Port of Seattle staff regarding technology policies and Information Security practices.
3. Improve security of network and applications.
FINANCE AND BUDGET:
The overall goal of the Finance & Budget (F&B) department is to continuously improve the institution’s
management of its assets, resources, budget, and processes.
BUDGET
Manage the Corporate budgeting process and coordinate the port-wide budget preparation and approval process.
Provide training to the Port staff on the budget system and PeopleSoft Financials Management Information
System (MIS). Provide on-going support to corporate departments and the divisions in both the budgeting and
financial performance reporting processes. Prepare and publish the budget document; file statutory budget with
King County. Monitor the operating budget and prepare monthly and quarterly reports to the Port Commission
and Executive Team. Provide on-going operating budget analysis for financial planning and decision makings.
FINANCE & TREASURY
Provide on-going debt management and regulatory compliance. Develop financial tools and policies as needed.
Evaluate opportunities to refund bonds or otherwise reduce borrowing costs. Evaluate need for bond funding of
new capital costs. Execute transactions as appropriate. Manage investment portfolio, cash flow and banking
relationships. Provide capital budget, tax levy and plan of finance information for the budget process and for
long-term funding analysis.
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Key Strategies & Objectives:
o Provide useful, timely, and accurate financial reports and information to the Executive Team and
Commissioners.
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Guide managers and staff and help them fully understand that budget is an important management tool
for business planning, resources allocation, accountabilities, performance, and control.
Improve the key performance metrics in the budget document and the quarterly performance report for
Corporate.
Provide outstanding budget and MIS training to budget support staff throughout the organization.
Manage cash, investment, existing debt, and new debt issuance effectively.
Manage relationships with the finance community.
Provide financial management tools and policies.
Provide capital budgeting and financial planning.
ACCOUNTING AND FINANCIAL REPORTING:
The Accounting & Financial Reporting (AFR) department’s key responsibilities are to administer the Port’s
broad accounting and financial reporting and related business processes, and to provide PeopleSoft Financials
& HCM-Payroll/Time Entry systems Port-wide functional administration.
The department’s operations provide the following Port-wide core services: Port accounting policies and
procedures development/enforcement, annual Port financial statements preparation/issuance, industry
prescribed accounting & financial reporting standards compliance assurance, accounts payable disbursements,
payroll administration, billing and lease management, accounts receivable, credit and collection enforcement,
general ledger administration, capital project costing, cash and debt accounting, fixed assets accounting,
grants billing and reporting, corporate credit card and procurement card administration, employee expense
reimbursements, corporate tax administration, external audits facilitation, and recurring fiscal management
reporting.
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Key Strategies & Objectives:
o Timely and meaningful financial information to facilitate sound decisions by Port leadership and
management.
o Quality and responsive accounting and financial reporting systems and services to meet evolving Portwide and divisional business needs.
o Business process improvements to increase productivity and operational efficiencies.
o Leverage technology to improve Port operations to conduct accounting and fiscal management
efficiently and in a decentralized environment.
o Improve use of the PeopleSoft Financials and HCM-payroll/time entry systems and the value they bring
to the organization.
o Provide essential knowledge on key accounting processes and systems, and compliance with related
legal and industry prescribed standards.
o Timely Port policies and protocols to facilitate proper stewardship of public funds and assets.
o Full compliance with evolving and complex accounting and financial reporting standards.
o Open opportunities for AFR team members to initiate and lead key focuses that result in value-added
changes to operations.
INTERNAL AUDIT:
Provide an objective review and assessment of the strategies, processes, systems and other activities that
management has implemented in order to achieve the organization’s goals and objectives. Conduct audits and
reviews of all Port activities independently and objectively to provide reasonable assurance over accountability,
fiscal integrity, compliance, operations and performance. Conduct risk-based operational/performance audits
throughout the Port in accordance with applicable auditing standards and the best practices of the internal audit
profession. Work with the Port’s financial auditors and the State Auditor's Office on governance and compliance
matters.
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Key Strategies & Objectives:
o Continue compliance with professional standards of the Yellow and Red Book requirements in the
conduct of audits and reviews to ensure that Internal Audit engagements are conducted in accordance
with the best practices of the profession but also in the most effective manner possible.
o Conduct a number of IT audits based on a 3-year audit plan which is a deliverable of the Enterprise
Technology Risk Assessment conducted in 2012.
o Continue to provide Continuing Professional Education (CPE) in order to maintain highly competent
staff.
o Continue to provide audit assurance over management controls across the Port in relation to:
o Commission and Port Leadership goals and objectives.
o Public expectations, performance and/or accountability.
o Compliance (federal, state, and local rules and regulations).
o Continue to proactively conduct departmental and/or Port-wide operational risk assessment.
o Maximize audit efficiency through TeamMate (audit management software).
OFFICE OF SOCIAL RESPONSIBILITY (OSR):
OSR’s key responsibilities and services can be categorized into five functions:
PROGRAMS
External workforce development and apprenticeship initiatives, Disadvantaged Business Enterprise (DBE)
Program, Small Contractor and Suppliers (SCS) Program, National Urban Fellows, Community Giving
Campaign and support the Clean Trucks Program and the Veterans Fellowship and other veteran-related
initiatives.
OUTREACH
Point of contact in the community regarding concerns and general issues with small businesses and other
constituents and stakeholders, extensive participation in community based events, conferences, speaking
engagements resource fairs, “meet and greets”, Regional Contracting Forum, etc. and provide training to small
businesses on “How to do business with the Port”.
CUSTOMER SERVICE
Provide direct services to Port departments relating to assistance with the Procurement Roster Management
System (PRMS) and the Small Contractor and Suppliers (SCS) Program, information and advocacy,
troubleshooting, in-house technical assistance and subject expertise (small business).
PROCUREMENT
Continue to provide and receive input related to Port procurement processes; participate on acquisition planning
for projects; set utilization goals and requirements on projects and other procurement contracts on a case-by-case
base, including Public Works and Category I, II and III procurements.
TRAINING
Provide Port-wide small business training focusing on the Small Contracting Suppliers Program approved under
Resolution 3618.

Key Strategies & Objectives:
o Increase job placements and training opportunities for local communities.
o Increase small business participation in Port procurement opportunities.
o Support the Port’s environmental initiatives including; the clean truck program and Lower Duwamish
cleanup project.
o Increase POS employee payroll deduction contributions and volunteer opportunities with non-profit
organizations.
o Support the National Urban Fellow and the Port’s Veterans’ Fellowships.
VIII-12
Port of Seattle
Corporate
2013 Budget and Business Plan
POLICE:
Provide professional law enforcement services to our unique policing environment; provide routine police
service and criminal investigative follow up to crimes that occur within the Port of Seattle Jurisdiction. Protect
the rights of individuals, preventing crime and building community partnerships in the Port of Seattle
Jurisdiction and in our surrounding communities. Serve as a regional law enforcement asset to assist our Port of
Seattle community by providing specialized services with an emphasis on customer service. Serve as the liaison
with federal, state, county and local law enforcement agencies to assist and support the Port of Seattle’s mission
and serve the Greater Puget Sound Community.

Key Strategies & Objectives:
o Improve the law enforcement services we provided to our various Port customers and stakeholders.
o Achieve and maintain state and national accreditation.
o Support the professional development of every member of the department.
o Enhance employee job satisfaction, effectiveness and resource utilization.
o Enhance the department’s ability to deter and respond to acts of extraordinary violence, disasters, and
unusual occurrences.
VIII-13
Port of Seattle
Corporate
2013 Budget and Business Plan
KEY PERFORMANCE INDICATORS/MEASURES
Key Performance Indicators/Measures
A. Foster a Strong Partnership with Surrounding Communities
1) Communicate messages/strategies to general public and specific
target groups by increasing attendance at Port events
2) Increase tourism offering across all markets
3) Customer Survey for Police Service
B. Continue to be a Strong Advocate of Social Responsibility
1) Tracking new business added to the SCS Program
2) Determining and tracking number of employees completing the
SCS training program
3) Increase Procurement Roster Management System (PRMS)
number
4) Support the Century Agenda Strategy of creating 100,000 new
jobs through Port Jobs or other relevant programs
5) Increase contracts awarded to SCS firms
6) Veteran Fellowship Program (# of veterans hired)
C. Maintain a Strong Culture of Transparency and Accountability
1) Respond to Public Disclosure Requests
2) Amount of money suggested/recovered as a result of lease and
concession audits
3) Complete one central accounting systems audit every year
4) Percentage of time spent auditing vs. administrative
5) Percent of audit annual work plan completed each year
D. Maintain the Port's Strong Financial Position
1) Corporate costs as a % of Total Operating Revenues
2) Clean independent CPA audits involving AFR
3) Timely process disbursement payment requests
4) Keep receivables collections aging 90% within 30 days
5) Investment Portfolio Yield
6) Percent of Commission authorized projects on budget
E. Provide Outstanding Support to Divisions
1) Contract Administration for Labor Relations
2) Labor Contract Negotiations
3) Information and Communication Technology System Availability
4) IT Network Availability
5) Police CALEA/WASPC Accreditation Standards Completion
F. Be a High Performance Workplace
1) MIS and Clarity Training
2) Time to Hire (days)
3) Employee Development Class Attendees/Structured Learning
4) Required Safety Training
5) Police Mandated Training Completion
6) Occupational Injury Rate
7) Total Lost Work Days
VIII-14
2011
Actual
2012
Estimates
N/A
N/A
89.0%
N/A
2013
Estimates
10% increase
Up 27.4% 10% increase
93.5%
85.0%
67
100
150
N/A
250
275
N/A
N/A
750
676
Base year
N/A
Base year
6
6
298
250
250
$260K
$1.6M
$300K
10% increase
from 2012
10% increase
from 2012
6
yes
75.0%
88.0%
yes
75.0%
95.0%
yes goal
75.0%
95.0%
14.8%
yes
4 days
yes
1.67%
95.0%
14.3%
yes goal
4 days
yes goal
1.00%
93.0%
14.3%
yes goal
4 days
yes goal
0.90%
95.0%
103
18
N/A
N/A
100.0%
84
44
99.8%
100.0%
28.0%
94
31
99.0%
99.9%
100.0%
64 users
84
N/A
97.0%
96.0%
6.2
1,164
90 users
85
169
98.0%
62.0%
6.3
800
90 users
85
300
98.0%
100.0%
6.0
650
Port of Seattle
Corporate
2013 Budget and Business Plan
D. CORPORATE BUDGET SUMMARY
The following Tables VIII-2 & VIII-3 and Figures VIII-1 & VIII-2 illustrate the administrative expense for
Corporate by department and by account:
TABLE VIII-2: ADMINISTRATIVE EXPENSE BY DEPARTMENT
($ in 000's)
BY DEPARTMENT
2011
Actual
Notes
2012
Budget
2013
Budget
% Change
2013 Bud2012 Bud
EXPENSES BEFORE CHARGES TO CAP/GOVT/ENVRS PROJECTS
Commission
Executive
Labor Relations
1
Legal
1
Risk Services
Health & Safety Services
Public Affairs
Accounting & Financial Reporting
Internal Audit
Finance & Budget
Information & Communications Technology
1
Human Resources & Development
Office of Social Responsibility
Police
Contingency
Total Expenses Before Charges to Cap/Govt/Envrs Projects
2
CHARGES TO CAPITAL/GOVT/ENVRS PROJECTS
OPERATING & MAINTENANCE EXPENSE
Commission
Executive
Labor Relations
Legal
Risk Services
Health & Safety Services
Public Affairs
Accounting & Financial Reporting
Internal Audit
Finance & Budget
Information & Communications Technology
Human Resources & Development
Office of Social Responsibility
Police
Contingency
Total Operating Expenses
$
738
1,487
1,018
3,028
2,614
1,053
6,494
5,779
1,080
1,435
21,231
4,921
1,349
21,154
105
73,825
$
(2,407)
2
738
1,487
941
2,975
2,614
1,053
6,494
5,776
1,080
1,435
19,132
4,921
1,349
21,154
105
$ 71,418
$
980
1,539
1,267
2,964
2,959
1,060
5,815
6,853
1,496
1,543
23,146
5,484
1,476
22,574
700
79,855
$
1,483
1,552
1,198
3,068
3,186
1,138
5,946
7,055
1,361
1,877
23,257
5,468
1,702
22,574
450
81,315
51.2%
0.8%
-5.4%
3.5%
7.7%
7.4%
2.2%
3.0%
-9.1%
21.7%
0.5%
-0.3%
15.3%
0.0%
-35.7%
1.8%
(3,320)
(2,508)
-24.5%
980
1,539
961
2,901
2,959
1,060
5,815
6,853
1,496
1,543
20,194
5,484
1,476
22,574
700
76,535
1,483
1,552
1,198
3,012
3,186
1,138
5,946
7,055
1,361
1,877
20,805
5,468
1,702
22,574
450
78,807
51.2%
0.8%
24.7%
3.8%
7.7%
7.4%
2.2%
3.0%
-9.1%
21.7%
3.0%
-0.3%
15.3%
0.0%
-35.7%
3.0%
$
adminbud.xls
Notes:
1) Departments with Charges to Capital Projects.
2) Does not include adjustment for charges into Corporate SubClasses from Divisions.
VIII-15
Port of Seattle
Corporate
2013 Budget and Business Plan
FIGURE VIII-1: ADMINISTRATIVE EXPENSE BY DEPARTMENT
Contingency
0.6%
Risk Services
4.0%
Accounting & Financial
Reporting
9.0%
Commission
1.9%
Executive
2.0%
Public Affairs
7.5%
Police
28.6%
Legal
3.8%
Finance & Budget
2.4%
Health & Safety Services
1.4%
Human Resources &
Development
6.9%
Information &
Communications
Technology
26.4%
Internal Audit
1.7%
Office of Social
Responsibility
2.2%
Labor Relations
1.5%
Total Expense: $78,807
VIII-16
Port of Seattle
Corporate
2013 Budget and Business Plan
TABLE VIII-3: REVENUES AND EXPENSES BY ACCOUNT
($ in 000's)
BY ACCOUNT
2011
Actual
Notes
Revenue
Other Revenue
Total Administrative Revenue
2012
Budget
2013
Budget
% Change
2013 Bud2012 Bud
1,559
1,559
151
151
155
155
2.6%
2.6%
Expense
Salaries, Wages, Benefits & Workers Compensation
Equipment Expense
Utilities
Supplies & Stock
Outside Services
Travel & Other Employee Expenses
Promotional Expenses
Other Expenses
55,068
1,409
9
669
10,194
2,232
968
3,276
59,742
1,219
11
648
10,930
2,593
268
4,443
60,579
1,479
8
629
11,344
2,743
400
4,133
1.4%
21.3%
-27.3%
-2.9%
3.8%
5.8%
49.3%
-7.0%
Total Operating Expenses Before Charges to Cap/Govt/Envrs Projects
Charges to Capital/Govt/Envrs Projects
73,825
(2,407)
79,855
(3,320)
81,315
(2,508)
1.8%
0.0%
-24.5%
Total Administrative Expense
1
$ 71,418
$ 76,535
$ 78,807
3.0%
adminbud.xls
Notes:
1) Does not include adjustment for charges into Corporate SubClasses from Divisions.
FIGURE VIII-2: ADMINISTRATIVE EXPENSE BY ACCOUNT
Promotional Expenses
0.5%
Other Expenses
Travel & Other Employee
Expenses
3.4%
Supplies & Stock
0.8%
Outside Services
Utilities
14.0%
0.0%
Equipment Expense
1.8%
5.1%
Salaries, Wages, Benefits &
Workers Compensation
74.5%
Total Before Charges to Capital/Govt/Envrs Projects: $81,315
Charges to Capital/Govt/Envrs Projects: $2,508
Total Administrative Expense $78,807
VIII-17
Port of Seattle
Corporate
2013 Budget and Business Plan
E. STAFFING
The following TABLE VIII-4 depicts the proposed staffing requirements for 2013 by department for Corporate.
Corporate is budgeting 449.2 FTEs, which is 3.0 lower than the 2012 budget. Please see the notes at the bottom
of table below for further explanations.
TABLE VIII-4: CORPORATE STAFFING
STAFFING
(Full-Time Equivalent Positions)
BY DEPARTMENT
Commission
Executive Office
Legal Counsel
Risk Services
Health & Safety
Public Affairs
Accounting & Financial Reporting
Finance & Budget
Internal Audit
Office of Social Responsibility
Information & Communication Technology
Labor Relations
Human Resources & Development
Police
Notes
1
2
3
4
5
6
7
2011
Actual
11.0
5.0
14.6
5.0
8.0
28.5
58.2
10.0
9.2
5.0
121.0
9.0
35.3
130.0
TOTAL CORPORATE PROFESSIONAL &
TECHNICAL SERVICES DIVISION
449.8
2012
2012
Budget
Est. Act.
11.0
11.0
5.0
5.0
15.0
15.0
6.0
6.0
8.0
8.0
28.5
27.0
58.2
58.2
10.0
10.0
9.2
9.2
5.0
5.0
121.0
122.0
9.0
9.0
35.3
34.3
131.0
131.0
452.2
450.7
2013
Budget
13.0
5.0
16.0
6.0
8.0
26.0
55.2
10.0
9.2
5.0
122.0
8.5
34.3
131.0
% Change
2013 Bud 2012 Bud
18.2%
0.0%
6.7%
0.0%
0.0%
-8.8%
-5.2%
0.0%
0.0%
0.0%
0.8%
-5.6%
-2.8%
0.0%
449.2
-0.7%
FTE.XLS PATS
Notes:
(1) Commission added 2, 1 Policy Analyst and received a Century Agenda Specialist from Public Affairs.
(2) Legal added a Sr. Investigator.
(3) Public Affairs transferred the Century Agenda Specialist to Commission and deleted a limited duration and a .5 Intern.
(4) HR&D deleted a Limited Duration position.
(5) ICT received a mid-year approval for a Limited Duration Software Developer.
(6) AFR deleted 2 Limited Duration positions - Bus. Tech Consultant, a Bus. Tech Analyst and Record Specialist.
(7) Labor Relations deleted the PLA Compliance Manager and Added .5 Administrative Staff.
VIII-18
Port of Seattle
Corporate
2013 Budget and Business Plan
F. CAPITAL BUDGET
Corporate has a total 2013 capital budget of $11.1 million, of which $742 thousand pertains to Capital
Development Division. For more detail refer to Capital Budget, Section X.
TABLE VIII-5 provides a summary of the Corporate 2013 capital budget.
TABLE VIII-5: CORPORATE CAPITAL BUDGET
($ in 000's)
2013
Budget
2013-2017 % of 2013 Total
CIP
Committed
Committed Capital Projects
Capital Development Division
Corporate General
ICT Business Services
Total Committed
$742
542
8,319
$9,603
$3,914
2,690
19,819
$26,423
Business Plan Prospective Projects
$1,525
$19,025
$11,128
$45,448
Total CIP
7.7%
5.6%
86.6%
100.0%
capsum.xls
G. CORPORATE SUMMARY
TABLE VIII-6: CORPORATE SUMMARY
2012
($ in 000's)
OPERATING BUDGET
Operating Revenue
Actual
2011
Notes
$
Corporate Expense
Law Enforcement Costs
Total
1,559
Budget
$
151
Budget
2013
Forecast
$
177
$
155
2.6%
4.2%
0.0%
3.0%
50,264
21,154
53,961
22,574
53,384
22,478
56,233
22,574
71,418
76,535
75,862
78,807
Income from Operations
$ (69,859) $ (76,384) $ (75,685) $ (78,652)
CAPITAL SPENDING
$
TOTAL FTEs
3,920
$
449.8
11,524
452.2
$
8,532
450.7
$
Growth
2013 Bud2012 Bud
3.0%
8,861
-23.1%
449.2
-0.7%
admhist.xls
VIII-19
This page was intentionally left blank.
VIII-20
Port of Seattle
Levy
2013 Budget and Business Plan
A. TAX AT A GLANCE

The maximum allowable levy for 2013 is $91.5 million.

For 2013 the levy will be $73.0 million.

The millage rate is estimated to be $0.2326.

The 2013 levy will be used for:
o
General Obligation (G.O.) Bonds Debt Service
o
Public Asset Expense: Freight Mobility
o
Seaport and Real Estate Environmental Remediation Liability
o
A portion of Real Estate operating expenses
o
Real Estate Capital Improvements
o
Seaport Argo Road Element capital project (partial funding)
o
Aviation School, and Highline and other Schools NOISE Insulation
o
Office of Port Jobs
o
Additions to the Transportation Infrastructure Fund (TIF)
B. TAX LEVY SOURCES
TYPES AND LIMITS OF LEVIES:
Regular Tax Levy
The County Treasurer acts as an agent to collect property taxes levied in the County for all taxing authorities.
Taxes are levied annually on January 1 on property value listed as of the prior year. Assessed values are
established by the County Assessor at 100% of fair market value. A re-evaluation of all property is required
annually.
Taxes are due in two equal installments on April 30 and October 31. Collections are distributed to the Port by
the County Treasurer.
The Port is permitted to levy up to $0.45 per $1,000 of Assessed Valuation for general Port purposes under
Washington State law in Revised Code of Washington (“RCW”) Chapter 53.36. The levy may go beyond the
$0.45 limit to provide for G.O. Bonds debt service. However, the rate may be reduced below the $0.45 limit
for the following reason: RCW Chapter 84.55 limits the annual growth of regular property taxes to the lesser
of 1% or the inflation rate, where inflation is measured by the percentage change in the implicit price deflator
for personal consumption expenditures for the United States, after adjustments for new construction. This 1%
limit factor was instituted by Initiative 747 that Washington State voters approved in November 2001. Prior to
the passage of the Initiative, the growth limit was the lesser of 6% or the inflation rate (for levy limit
calculation see Section XII Statutory Budget).
IX-1
Port of Seattle
Levy
2013 Budget and Business Plan
FIGURE IX-1 shows the maximum levy permitted by law versus the actual levy levied by the Port from 1991
(the last year the Port levied the maximum) to 2013. In 1989, the law was changed whereby a port could have
a levy at less than the maximum while preserving the ability to tax up to the maximum in the future if the need
was justified. This allows a port to tax at the lower level in the years when the maximum levy is not required,
but return to the maximum level in years of need. Since 1991, on a cumulative basis, the Port has levied a
total of $368 million less than it could have if it had levied the maximum allowable levy each year.
FIGURE IX-1: ACTUAL TAX LEVY VS. MAXIMUM ALLOWABLE LEVY: 1991-2013
$ Millions
$100
Maximum
Allowable Levy
$90
$80
$70
$60
$50
Cumulative foregone taxes
= $368 million
$40
Actual Tax Levy
$30
$20
$10
$0
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
FIGURE IX-2 shows the historical millage rate from 2004 to 2013. The Port kept the tax levy at $73.5
million for 2010 and 2011, and reduced it to $73.0 million in 2012. The levy amount is $73.0 million for
2013.
FIGURE IX-2: TAX LEVY VS. MILLAGE RATE 2004-2013
$ Millions
$80
$75.90
$0.70
$75.90
$73.50
$73.00
$73.00
$68.81
$70
$0.60
$62.78
$60
$73.50
$62.79
$59.66
$0.50
$50
$0.40
$40
$0.25
$0.30
$0.25
$0.23
$30
$0.23
$0.22
$0.22
$0.22
$0.23
$0.23
$0.20
$0.20
$20
$0.10
$10
$0
$0.00
2004
2005
2006
2007
Tax Levy (Left Scale)
2008
2009
2010
2011
2012
Millage (Right Scale)
IX-2
2013
Port of Seattle
Levy
2013 Budget and Business Plan
Special Tax Levies
Special levies approved by the voters are not subject to the same limitations as the regular levy.
The Port can levy property taxes for dredging, canal construction, leveling or filling upon approval of the
majority of voters within the Port District, not to exceed $0.45 per $1,000 of Assessed Value of taxable
property within the Port District.
Industrial Development District Tax Levies
The Port may also levy property taxes for Industrial Development Districts (under a comprehensive scheme of
harbor improvements), for twelve years only, not to exceed $0.45 per $1,000 of Assessed Value of taxable
property within the Port District. The Port of Seattle levied the tax for a six-year period between 1963 and
1968 for property acquisition and development of the lower Duwamish River. If the Port intends to levy this
tax for a second six years (or the seventh through twelfth year period), the Port must publish notice of intent to
impose such a levy and if signatures of at least eight percent (8%) of the voters protest the levy, a special
election must be held with majority approval required. The Industrial Development Levy could be imposed at
up to $0.45 per $1,000 in the first year and the lesser of $0.45 per $1,000 or the 1% limit factor described
above in subsequent years. The Port has not levied the seventh through twelfth year period but if the Port were
to Levy under this law, Port may levy up to an estimated $869 million over the six year period.
C. TAX LEVY USES
During the annual budget process, the Commission reviews and approves the use of the tax levy. The levy, by
Washington State statute, may be used broadly for general Port purposes. The Port’s policy has been to
prioritize the use of the levy to first pay debt service on General Obligation (G.O.) bonds issued to fund
portions of critical capital infrastructure investments in the Seaport, Real Estate and Corporate divisions.
Thereafter, the levy is used to cash fund investments that provide economic growth and community benefits.
These include environmental mitigation in the Seattle Harbor, regional freight mobility initiatives such as
FAST Corridor, the purchase of the Eastside Rail Corridor, and PortJobs, a non-profit organization that helps
develop Port and Airport-related career opportunities. Recently, the Port began using the tax levy to pay for a
portion of Real Estate operating expenses.
Beginning in 2010 the Port began to set aside resources in a Transportation & Infrastructure Reserve Fund
(TIF) for the Port’s contributions toward certain regional transportation and special item projects: the SR99
tunnel and the South Park Bridge public expense projects. To date, the TIF has been funded with $36 million
of tax levy, and $6 million will be added in 2013. The Port anticipates using $5 million from the TIF toward
the South Park Bridge public expense project, by contributing two payments of $2.5 million in 2012 and 2013.
Expenditures from the TIF are not included in Table IX-1.
The levy has not traditionally been used for projects at Sea-Tac International Airport, however, the
Commission approved the use of the levy for specific projects not eligible for Airport funding such as noise
mitigation improvements at certain Highline School District schools near to Sea-Tac Airport, and the district’s
Aviation High School.
For 2013, the Port plans to use the levy for the debt service on G.O. Bonds, Real Estate and Corporate capital
improvements, FAST Corridor, Seaport and Real Estate environmental costs, the Aviation High School
project, and Port Jobs. The Seaport’s Argo Yard Roadway Element capital projects which are part of a publicprivate freight mobility effort will be partially funded with the levy, as will a portion of the Real Estate
division’s operating expenses. TABLE IX-1 shows how the Port plans to spend the levy in 2013. Additional
details are provided in Tables IX-2 and IX-3.
IX-3
Port of Seattle
Levy
2013 Budget and Business Plan
TABLE IX-1: SOURCES AND USES OF TAX LEVY
TABLE IX-1 shows how the Port plans to spend the levy in 2013.
2013
Notes
($ in 000's)
SOURCES
Prior Year Levy Fund Balance
Projected Tax Levy Collection
Total Projected Sources
48,451
73,000
121,451
USES
G.O. Bonds Debt Service - Seaport
G.O. Bonds Debt Service - Real Estate
Total Projected G.O. Debt Service
37,227
3,129
40,357
Committed Capital Expenditures - Real Estate
Committed Capital Expenditures - Seaport
16,073
1,611
Expenses:
Public Expense: Seaport Freight Mobility
Transportation & Infrastructure Reserve Fund
Environmental Remediation Liability (Seaport & Real Estate)
Portion of Real Estate Operating
Port Jobs & related programs
Aviation School, and Highline & other Schools NOISE Insulation
Total Expenses
1
1,151
6,000
12,787
6,406
198
7,160
33,702
2, 3
Capital Expenditures: BP Prospective - Real Estate
300
Total Projected Uses
92,043
Projected Ending Balance
Notes:
$
29,408
1) Net of grant receipts.
2) Includes project cashflows for environmental projects already or expected to be expensed and liabilities booked.
3) Includes Seaport non-operating Environmental Remediation Liability (ERL) and Real Estate non-perating and
operating ERL .
IX-4
Port of Seattle
Levy
2013 Budget and Business Plan
TABLE IX-2 provides the estimated 2013 project spending that the Port expects to fund with the tax levy. In
addition, any Real Estate Business Plan Prospective projects that are advanced in 2013 may be eligible for levy
funding.
TABLE IX-2: LEVY FUNDED COMMITTED PROJECTS
TABLE IX-2 provides the committed projects that the Port expects to fund with a portion of the tax levy
proceeds.
2013
($ in 000's)
Real Estate
Pier 69 Renewal Projects
Fishermen's Terminal
Technology, Small and Other Projects
Tenant Improvements
Fleet Replacement
MIC Roof Replacement
SBM Improvements
Total Real Estate Projects
$
$
8,124
4,469
2,075
259
476
570
100
16,073
$
1,611
$
17,684
Seaport
North Argo Road Element
Total Committed Projects
IX-5
Port of Seattle
Levy
2013 Budget and Business Plan
TABLE IX-3: EXISTING G.O. BONDS DEBT SERVICE BY PROJECTS AND GROUP
TABLE IX-3 provides the allocation of existing G.O. bonds debt service to the projects that were funded by
G.O. bonds issued in 1994, 2000, 2004, 2006 and 2011.
2013
($ in 000's)
Containers
Stage II Dredge- Phase I
T-5 Expansion & Upgrades
T-46 Expansion Redevelopment
T-18 Expansion & Upgrade
Total Containers
$
Docks and Commercial Properties
T-91 Apron & Infrastructure Improvements
Pier 17 Dock Replacement
T-86 Terminal Upgrades
Total Docks and Commercial Properties
922
21,156
4,457
8,358
34,893
2,119
122
120
2,361
Commercial Properties
World Trade Center Garage
640
Fishing
Fishermen's Terminal Docks & Seawall Renewal
1,656
Special Item
Eastside Trail
805
Total G.O. Bond Debt Service
$
IX-6
40,357
Port of Seattle
Levy
2013 Budget and Business Plan
D. GENERAL OBLIGATION CAPACITY
Non-Voted and Voted General Obligation Debt Limitations
Under Washington State law the Port may incur indebtedness payable from ad valorem taxes in an amount not
exceeding one-fourth of one percent of the value of the taxable property in the District without a vote of the
people. With the assent of three-fifths of the voters voting thereon, the District may incur additional G.O.
indebtedness provided the total indebtedness of the Port at any time shall not exceed three-fourths of one
percent of the value of the taxable property in the District. For the Port, the following estimates the 2013 debt
limit:
Value of Taxable Property
(1)
$
313,838,474,995
Debt Limit, Non-Voted General Obligation Bonds (.25% of Value of Taxable Property)
Less: Outstanding Non-Voted General Obligation Bonds as of 12/31/2012
Less: Capital leases and other general obligations as of 9/30/2012
Remaining Capacity of Non-Voted General Obligation Debt
$
$
784,596,187
312,005,000
472,591,187
Debt Limit, Total General Obligation Debt (.75% of Value of Taxable Property)
Less: Total Outstanding General Obligation as of 12/31/2012
Less: Capital leases and other general obligations as of 9/30/2012
Remaining Capacity of Total General Obligation Debt
$
$
(1)
Preliminary assessed valuation as of 11/5/2012
$
$
2,353,788,562
312,005,000
2,041,783,562
LE VY.XLS
The Port may levy property taxes sufficient for the payment of principal of and interest on voted G.O.
indebtedness. The existing limitation provides that unless a higher rate is approved by a majority of the voters
at an election, the increase in regular total property taxes payable in the following year shall not exceed the
lesser of inflation or one percent of the amount of regular property taxes lawfully levied for such district in the
highest of the three most recent years in which such taxes were levied for such district, plus an additional
dollar amount calculated by multiplying the increase in assessed value in that district resulting from new
construction and improvements to property by the regular property tax levy rate of that district for the
preceding year. With a super majority vote, the Port Commission can increase the levy by 1% if inflation is
less than 1%.
Interaction between General Purpose Levy and General Obligation Debt Capacity
Since the 101% levy limitation applies to the total levy for G.O. debt service and for general Port purposes, an
increase in the tax levy for G.O. bonds may result in a decrease in the amount which could be levied for
general Port purposes, unless a higher aggregate tax levy was approved by the voters.
Beginning with the 2001 Budget, the Port established a target to use no more than 75% of the levy for debt
service and retain at least 25% for general purposes.
IX-7
Port of Seattle
Levy
2013 Budget and Business Plan
E. TAXPAYER EFFECT
FIGURE IX-3 shows the assessed valuation as compared to the millage rate from 2004 to 2013. The graph
shows that the assessed value has increased from $236 billion in 2004 to an estimated $313 billion in 2013,
while millage (the rate paid per $1,000 Assessed Value) has decreased from $0.2540 in 2004, to the 2013 rate
of $0.2326. Assessed value for 2012 is estimated to be $313,838,474,995. (The 2012 assessed valuation is
used for 2013 tax collection).
FIGURE IX-3: KING COUNTY ASSESSED VALUATION VS. PORT MILLAGE RATE 2004-2013
Rate/$1,000
$Billions
420
$1.00
400
380
$0.90
360
340
$0.80
320
300
$0.70
280
$0.60
240
220
$0.50
200
180
$0.40
160
140
$0.30
120
100
$0.20
80
60
$0.10
40
20
0
$0.00
04
05
06
07
08
09
10
Assessed Value (Left Scale)
11
12
13
Millage (Right Scale)
F. COUNTY PROPERTY TAX COMPARISON
For 2012, the Port accounted for 2.0% of the total property taxes collected by the County.
FIGURE IX-4: 2012 PERCENTAGE OF TAX LEVIES BY TAXING DISTRICT
Port
2%
All Other
14%
County
12%
State Schools
21%
Local Schools
32%
Municipal
19%
IX-8
Millage
Assessed Value
260
Port of Seattle
Capital Budget
2013 Budget and Business Plan
CAPITAL BUDGET
The following pages provide detail of the projects included in the 2013-2017 capital budget. Additional
information can be found in each of the divisions’ business plans and operating budgets, as well as the Draft
Plan of Finance section of this document.
Projects in this year’s plan are divided into several categories. Committed Projects are ongoing projects or
projects that are ready to move forward and for which a funding commitment will be secured. Business Plan
Prospective Projects are less certain in timing or scope, but are considered critical for achieving business plan
goals, and the business unit or division has approved them. Other Prospective Projects are preliminary in
nature and are not ready for full funding commitment. Prospective projects are included in the capital budget
section for informational purposes only.
TABLE X-1: CAPITAL BUDGET
($ in 000's)
Est. Act. (1)
2012
2013
2014
2015
2016
$19,574
1,379
30,911
42,135
17,547
16
1,121
4,414
9,056
126,153
$25,187
2,725
9,306
64,557
23,434
0
2,833
12,896
10,255
151,193
$53,070
1,547
7,391
87,678
17,033
1,000
0
12,003
5,290
185,012
$30,530
500
0
103,096
15,279
1,000
0
15,700
2,069
168,174
$0
500
0
51,700
16,119
262
0
8,540
188
77,309
Lease & Asset Management
4,692
5,529
23,469
13,850
Cruise & Maritime Operations
Environmental Services
7,271
20
4,303
815
983
0
200
0
1,291
13,274
900
11,547
1,433
25,885
Real Estate Division
General Real Estate
Harbor Services
Portfolio Management
Real Estate Division
2,949
57
1,175
4,181
10,675
1,421
4,692
16,788
Professional & Tech. Services
Capital Development Division
Corporate General
ICT Business Services
P&TS
436
557
7,975
8,968
Total
2013-2017
2017
Committed Projects
Aviation Division
Airfield
Business Development
Landside
Air Terminal
Infrastructure
Stormwater
Airfield Security
Aviation NOISE
Aviation F&B (Division-wide)
Aviation Division
$0
500
0
11,044
3,639
0
0
0
0
15,183
$108,787
5,772
16,697
318,075
75,504
2,262
2,833
49,139
17,802
596,871
350
0
43,198
200
0
200
0
5,886
815
1,025
15,075
1,250
1,800
1,000
1,200
5,608
55,507
2,294
1,000
5,680
8,974
1,609
2,450
483
4,542
1,800
2,450
433
4,683
1,947
0
87
2,034
18,325
7,321
11,375
37,021
742
542
8,319
9,603
996
545
3,250
4,791
717
496
2,750
3,963
823
585
2,750
4,158
636
522
2,750
3,908
3,914
2,690
19,819
26,423
$152,576
$189,131
$224,662
$191,754
$87,950
$22,325
$715,822
$10,863
0
0
200
$11,063
$33,047
1,500
300
1,525
$36,372
$85,932
36,200
7,110
4,000
$133,242
$144,671
90,980
13,520
4,500
$253,671
$377,460
43,700
3,350
4,500
$429,010
$216,172
67,850
7,800
4,500
$296,322
$857,282
240,230
32,080
19,025
$1,148,617
$163,639
$225,503
$357,904
$445,425
$516,960
$318,647
Seaport Division
General Seaport
Seaport Division
Total Committed
Business Plan Prospective Projects
Aviation Division
Seaport Division
Real Estate
Corp General (ICT Business Services)
Total Business Plan Prospective
Total Port of Seattle
$1,864,439
capsum.xls
[1]
Estimated/Actual 2012 represents six months of actual spending and six months of projected spending.
X-1
Port of Seattle
Capital Budget
2013 Budget and Business Plan
AVIATION DIVISION CAPITAL IMPROVEMENT PROGRAM
General: The Committed capital budget is focused on meeting capacity and customer needs, and maintaining
existing assets through ongoing renewal and replacement. In 2012, in collaboration with Alaska Air Group
(AAG), the Port launched the NorthSTAR program. This is a combination of projects aimed at upgrading the
North Satellite, Concourse C, portions of the Main Terminal and the baggage system connecting to the North
Satellite. This program will provide much needed renovations to old terminal facilities as well as
accommodate the consolidation of AAG at the North Satellite and Concourse C.
Major Committed Capital Projects:
Noise Remedy Program: The Port’s Noise Remedy Program began in 1971 and is designed to mitigate
aircraft noise in neighborhood communities. The program involved the buy-out or insulation of single-family
houses, mobile home parks, multi-family buildings, and institutional buildings. The current program involves
insulation of single-family homes and classrooms at the Highline Community College. This program also
includes future project spending for Highline School District noise mitigation. The cost for the overall noise
remedy program for 2013 – 2017 totals approximately $49 million.
Terminal Escalators Modernization: This project will replace 42 aging escalators and add 2 new escalators
over a seven-year period. The total budget is $55 million. The project will be completed in 2013.
Central Plant Pre-conditioned Air: This project will provide pre-conditioned air for heating and cooling of
aircraft while parked at gates. While at a gate, an aircraft’s heating and air conditioning is provided by either
the aircraft’s onboard auxiliary power unit (APU) or a ground based supply system. Utilization of the
aircraft’s APU is expensive and it generates significant carbon dioxide and other air emissions. The total
budget for the project is $45.5 million. The project will be completed in 2013.
Aircraft Remain Overnight (RON) Parking, U.S. Postal Service (USPS) Site: This project involves buying
out the lease of the USPS Airmail Center, demolition of the building, and the construction of aircraft parking
hardstands. Demolition of the building was accomplished in 2012. Hardstand aircraft parking construction
will commence in 2013. The overnight aircraft parking positions are necessary to facilitate the early morning
departures of passenger flights. The total budget is $45.9 million.
Electrical Ground Service Equipment (EGSE) Electrification: This project will install infrastructure and
charging stations that will permit airlines to charge electrical ground service equipment. The equipment will
be owned and operated by airlines. The project is under construction. The total budget is $30.2 million.
NSAT Renovation: In collaboration with Alaska Airlines, the Port will renovate the North Satellite to address
seismic concerns, upgrade HAVAC and lighting, upgrade fixtures and reconfigure space to add three gates.
The total budget is $194 million. The project is in design.
SSAT Renovation: This project will renovate or replace the HVAC, lighting and ceilings at the South
Satellite. The total budget is $34.0 million. The project is in design.
Business Plan Prospective CIP:
The Aviation Business Plan Prospective CIP is composed of project spending for Airfield, Landside,
Terminal, Infrastructure, and other Aviation needs. Fourteen projects have moved to business plan
prospective status for 2013 (see Section IV for a list of these projects). Included in this list is a new Federal
Inspection Services (FIS) facility, with an estimated total cost of $494 million, to be built in two phases over
approximately ten years. The commission will be briefed on this project in Q1 2013. Prospective projects
are, by definition, not yet well scoped, so there is greater uncertainty with regards to timing and costs than
with committed projects. As scoping, design and bidding occurs, each project moves forward in steps to the
Commission to request authorization. See Section IV for a description of major existing and new projects.
X-2
Port of Seattle
Capital Budget
2013 Budget and Business Plan
SEAPORT DIVISION CAPITAL IMPROVEMENT PROGRAM
General: The Seaport’s current five-year capital improvement program continues the Port’s emphasis on
supporting investments in facilities and infrastructure for the movement of container and non-container cargo.
Committed Capital Projects:
Lease and Asset Management: Lease and Asset Management encompasses the container terminals, the
Terminal 86 grain facility and leased Seaport industrial properties. The most significant container related
project is the rehabilitation of docks at Terminal 46. Other container related projects include creation of a
dedicated truck roadway from Harbor Island to the Union Pacific Argo Yard and various street vacation
related projects resulting from previous terminal expansions at Terminals 5, 18 and 30. Other industrial
property projects are primarily renewal and replacement efforts. These include a roof replacement for a
tenant occupied cold storage building on Pier 90, drainage and paving upgrades related to a lease extension at
Terminals 106 and 108, and an electrical substation upgrade at Terminal 91.
Cruise and Maritime Operations: The most significant cruise related projects are the completion of the
upgrade of the Pier 91 fender system, the Pier 66 Apron Pile-Wrap project and the upgrade of security
cameras at Pier 66 from analog to digital. Included for Security are funds for capital projects to be largely
reimbursed through TSA Seaport Security Grants Rounds 9 and 10.
Environmental: The Seaport Green Initiative is a project to improve energy efficiency at Terminal 91 by
upgrading existing lighting with high efficiency LED or LEP technology fixtures and by installing lighting
controls.
General Seaport: Additional committed projects include small projects and technology related investments.
Business Plan Prospective CIP:
The Seaport Business Plan Prospective CIP is a combination of revenue/capacity growth,
renewal/enhancement, and environmental projects. Revenue capacity growth projects includes funds for the
purchase of land for future expansion of offsite container support yards for handling up to 3.5M TEU’s, funds
for dredging and additional gangways at Terminal 91 to support larger cruise ships, and a project to install
new dolphins and catwalks for use by barges at Pier 34. Renewal/enhancement projects include funds to
redevelop berths 6 and 8 on Pier 90, rehabilitate the docks at Terminal 18, and for future improvements at
Terminal 46. Also included is a general renewal and replacement project to allow for projects that cannot be
determined with certainty as to location, timing and cost. A key environmental project in Business Plan
Prospective status is the plan to bring shore power for cruise ships to Pier 66.
REAL ESTATE DIVISION CAPITAL IMPROVEMENT PROGRAM
General: Projects in the Real Estate Division’s current five-year capital improvement program are primarily
projects associated with the renewal and replacement of infrastructure, building components and systems that
are at or beyond the end of their useful lives. Also included is a significant investment in tenant
improvements related to the releasing of space expected to become vacant as existing leases expire.
Committed Capital Projects:
Harbor Services Projects: Committed projects include replacement of the central seawall, restrooms and
paving at Shilshole Bay Marina, and a net shed roof replacement at Fishermen’s Terminal.
Portfolio Management: Key projects at Fishermen’s Terminal include HVAC improvements and subsidence
improvements for the Fishermen’s Center Building, a new roof and HVAC improvements for the Norby
Building, and paving and drainage improvements for the overall site. Another project is a roof replacement
for the A1 Building at the Maritime Industrial Center. Other projects are for tenant improvements and for
X-3
Port of Seattle
Capital Budget
2013 Budget and Business Plan
renewal and replacement of building components and systems that are at or beyond the end of their useful
lives.
Real Estate Development and Planning: There are no committed projects under Real Estate Development and
Planning.
General Real Estate: Committed projects include fleet replacement, technology related investments, and small
projects. Another project is installation of a corrosion protection system for the existing steel pilings under
the north apron of Pier 69 and replacement of the built-up roof on the Pier 69 Port headquarters’ building.
Business Plan Prospective CIP:
The Real Estate Business Plan Prospective CIP is primarily renewal and replacement projects. Renewal and
replacement projects include various projects at Fishermen’s Terminal and Shilshole Bay Marina. Also
included is a general renewal and replacement project to allow for projects that cannot be determined with
certainty as to location, timing, and cost.
CAPITAL DEVELOPMENT DIVISION CAPITAL IMPROVEMENT PROGRAM
The Capital Development Division (CDD) delivers projects and provides technical and contracting services in
support of the business plans and infrastructure needs of the Port’s operating divisions. CDD includes the
following departments: Aviation Project Management Group, Seaport Project Management Group, Central
Procurement Office, Engineering, and Port Construction Services. The Capital Development Division’s
current five-year capital improvement program is primarily for the replacement of equipment and vehicles
that are at or beyond the end of their useful lives. For example, the largest fleet project is to replace a 1993
Komatsu Excavator for Port Construction Services. The lesser portion of the CIP is for engineering
equipment purchases (survey equipment, plotter, copiers, and a large-format printer).
CORPORATE CAPITAL IMPROVEMENT PROGRAM
The Corporate’s current five-year capital improvement program is predominantly technology improvements
and upgrades. Approximately 16% of 2013 technology capital improvement projects are refresh of critical
infrastructure and network security enhancements required to maintain compliance with established industry
standards. The remaining technology capital improvement projects are mostly for system upgrades,
replacements or consolidation of existing systems that require refresh. These technology projects are all
driven by business unit demand, with system upgrades being required to maintain system operations and
ongoing vendor support. The largest corporate capital improvement project is an upgrade to the Port’s
financial system. This upgrade is required to maintain system support from Oracle and was recommended in
the Moss Adams audit. Police fleet replacement and a small portion for small capital are also included in the
Corporate CIP.
X-4
Port of Seattle
Capital Budget
2013 Budget and Business Plan
In addition to the Committed, Business Plan Prospective and Other Prospective project categories described
above, the Port may also invest in Public Expense projects (projects that meet the criteria of Committed or
Business Plan Prospective projects but the expenditures are expensed instead of capitalized). This can occur
when projects’ improvements are created on non-Port properties; they are generally a required component of
other Committed projects or they are the Port’s contribution to regional transportation needs. In addition to
the Public Expense projects, the Port anticipates expenditures for a Special Item for its contribution toward
the replacement of the Alaskan Way Viaduct (SR99) of up to $300 million.
TABLE X-2: PUBLIC EXPENSE AND SPECIAL ITEM PROJECTS
($ in 000's)
Division
CIP Description
Aviation
Aviation High School
SR 518 Corridor Improvements
Decided
include for 2010 as per Dan Thomas.
Subtotalnot
fortoAviation
5 Year Total
2013
$
2014
2015
650
1,318
1,968
-
2,500
-
2016
(2013 - 2017)
2017
$
-
-
-
650
1,318
1,968
-
-
2,500
Corporate
South Park Bridge
Seaport
Fast Corridor II (1)
East Marginal Way Phase 2
North Argo Express Access
Puget Sound Clean Air Agency
Subtotal for Seaport
386
650
115
1,050
2,201
675
1,200
1,050
2,925
1,050
1,050
1,050
1,050
730
730
1,791
1,850
115
4,200
7,956
Total - Public Expense
6,669
2,925
1,050
1,050
730
12,424
-
-
-
281,000
281,000
-
281,000
281,000
$ 6,669
$ 2,925
$ 1,050
Special Item
SR99 Tunnel Replacement (2)
Total - Special Item
Grand Total - Public Expense and Special Item Projects
$
282,050
$
730
$
293,424
_5YrCapBud&ProspectiveProj.xlsx
Notes:
1)
Net of grant receipts.
2)
Payment toward the Port’s contribution of up to $300 million per the Memorandum of Agreement No. GCA 4444, dated 02/09/2010.
X-5
Port of Seattle
Capital Budget
2013 Budget and Business Plan
TABLE X-3: NON-RECURRING CAPITAL BUDGET IMPACT ON THE OPERATING BUDGET
Criteria:
1. Spending is included in the Port's Committed CIP
2. Capital spending on projects that add significant new capacity
3. Facility is not yet in use
4. Does not include improvements or upgrades to existing facilities unless the project provides additional capacity
($ in 000's)
Aviation Division:
Escalators Modernization
Capital Spending
Change in Operating Revenues
Change in Operating Expenses
Aircraft RON Parking
Capital Spending
Change in Operating Revenues
Change in Operating Expenses
Ticket Zone 3 Flow-Thru
Capital Spending
Change in Operating Revenues
Change in Operating Expenses
North Satellite Renovation
Capital Spending
Change in Operating Revenues
Change in Operating Expenses
Capital Spending
Change in Operating Revenues
Change in Operating Expenses
Notes
Capital Budget
Impact
Recurring (R) or NonRecurring (NR)
Yes
NR
2013
$
1
Yes
No
Real Estate Division:
No
Professional & Tech. Services:
No
$
651
-
$
2017
651
-
$ 3,639
651
-
Total
2013-2017
$
12,639
2,605
-
6,000
-
20,000
540
-
13,214
2,339
-
3,528
-
3,528
-
39,214
9,934
-
8,000
-
4,495
625
-
951
-
951
-
951
-
12,495
3,477
-
15,000
38,000
-
47,500
1,160
71,995
2,976
-
77,500
4,597
90,714
8,538
-
46,500
10,205
46,500
15,335
-
6,775
13,570
72
10,414
18,700
72
193,275
29,532
72
257,623
45,548
72
NR
1
Seaport Division:
651
-
2016
NR
1
Yes
$
2015
NR
2
Yes
9,000
-
2014
-
Port-wide Total
38,000
71,995
90,714
46,500
10,414
257,623
2,976
8,538
15,335
18,700
45,548
$
- $
- $
- $
- $
72
72
$0
$0
$0
$0
$0 $
$0
Capital Spending
Change in Operating Revenues
Change in Operating Expenses
Table X-3.xls
Notes:
1) The estimated debt service for this project will be incorporated into the terminal rental cost recovery formula and thus increase revenues.
2) The estimated debt service for this project will be incorporated into the landing fee cost recovery formula and thus increase revenues.
X-6
Port of Seattle
Plan of Finance
2013 Budget and Business Plan
2013-2017 Draft Plan of Finance
The Port is not including a Draft Plan of Finance in the 2013 Budget and Business Plan. The Draft Plan of
Finance is based on the five-year operating forecast and five-year Capital Budget, both of which are in the
process of being revised and are expected to differ from the information presented in this document.
filename: _11 PlanFin
updated:2/22/2013
XI-1
This page was intentionally left blank.
filename: _11 PlanFin
updated:2/22/2013
XI-1
Port of Seattle
Statutory Budget
2013 Budget and Business Plan
PORT OF SEATTLE
2013 STATUTORY BUDGET
A. INTRODUCTION
The "statutory" budget as defined in RCW 53.35.010 is to portray "the estimated expenditures and the
anticipated available funds from which all expenditures are to be paid." As a cash budget, the Statutory
Budget establishes the need for the tax levy and sets upper limits on expenditures, and is not used as an
operating budget. The function of controlling and managing the operations of the Port is accomplished with
the Operating Budget, which is provided in Sections IV through VIII.
The Preliminary 2013 Statutory Budget is provided to the Port Commissioners and made available to the
general public as required by law (RCW 53.35.010 and RCW 53.35.045). Notice of the Public Hearing, with
an announcement that copies of the preliminary budget are available for distribution to any interested persons,
will be published on October 29th, 2012, in the DAILY JOURNAL OF COMMERCE, as required by law
(RCW 53.35.020 and RCW 53.35.045). The final statutory budget will be filed with the King County Council
on November 29th, 2012, as allowed by RCW 53.35.045.
B. STATUTORY BUDGET HIGHLIGHTS
1. Tax Levy
For 2013, the tax levy amount is assumed to be $73,000,000. The following is a comparison of the tax levy
detail between 2012 and 2013:
For General Obligation Bonds
For General Purposes
Total levy
Budget 2012
Levy
Levy
Rate
Amount
$ 0.1279 $ 40,352,885
Budget 2013
Levy
Levy
Rate
Amount
$ 0.1286 $ 40,356,510
0.1034
32,647,115
0.1040
32,643,490
$ 0.2313
$ 73,000,000
$ 0.2326
$ 73,000,000
LEVY.XLSX
2. Tax Levy Rate
The tax levy rate is a product of dividing the tax levy dollars by the assessed valuation of personal and real
properties within the Port District. Therefore, if assessed valuation increases at a greater amount than the
dollars the Port would be allowed under the 101% lid law, the tax millage rate would go down even though
the Port's levy dollars may have increased. The exact levy rate is determined by the County Assessor after all
taxing agencies have requested their levy dollars, and the assessed valuation dollars are certified. The 2012
preliminary assessed valuation is $313,838,474,995 after omitted assessments, which are not included in the
Port’s levy calculation. (The 2012 assessed valuation is used for 2013 tax collection.) This is a decrease from
the 2011 assessed valuation, which was $315,588,352,233 after omitted assessment - See Section IX, Tax
Levy.
Filename: Stat_bud.doc
Updated: 2/20/2013
XII - 1
Port of Seattle
Statutory Budget
2013 Budget and Business Plan
C. RESOLUTIONS
RESOLUTION NO. 3670
A RESOLUTION
of the Port Commission of the Port of Seattle adopting the final
budget of the Port of Seattle for the year 2013; making,
determining, and deciding the amount of taxes to be levied upon the
current assessment roll; providing payment of bond redemptions
and interest, cost of future capital improvements and acquisitions,
and for such general purposes allowed by law which the Port deems
necessary; and directing the King County Council as to the specific
sums to be levied on all of the assessed property of the Port of
Seattle District in the Year 2013.
WHEREAS, the Port of Seattle Commission, on the 25th day of October, 2012, prepared the
preliminary budget of the Port of Seattle for the year 2013 and provided for the publication of Notice of
Budget Hearing on the adoption of said budget, to be heard on the 13th day of November, 2012, when
taxpayers might appear and present objections to said preliminary budget; and
WHEREAS, a public hearing on said preliminary budget was held in the office of the Port
Commission, pursuant to notice duly given, in the City of Seattle, County of King, State of Washington, on the
13th of November 2012, at 1 p.m.; and
WHEREAS, all parties present were afforded a full opportunity to present objections to the
preliminary budget, and the Port Commission being duly advised in the premises; and
WHEREAS, the King County Assessor has notified the Commissioners of the Port of Seattle on
November 5, 2012 that the regular levy assessed value of the property lying within the boundaries of said
district for the year 2012 is $313,838,474,995 (after omitted assessments).
NOW, THEREFORE, BE IT RESOLVED, by the Port Commission of the Port of Seattle that the
preliminary budget of the Port of Seattle for the year 2013, as presented at the aforementioned hearing, is
hereby adopted as the final budget of the Port of Seattle for the Year 2013; and
BE IT FURTHER RESOLVED, that the amount of taxes to be levied by the Port of Seattle on the
current assessment rolls to provide for payment of bond redemption and interest on the Port of Seattle General
Filename: Stat_bud.doc
Updated: 2/20/2013
XII - 2
Port of Seattle
Statutory Budget
2013 Budget and Business Plan
Obligation Bonds, for future expenditures for acquisitions and capital improvements and for such general
purposes allowed by law which the Port deems necessary be set and deposited is $73,000,000; and
BE IT FURTHER RESOLVED, that the King County Council, State of Washington, be notified that
the specific sum herein mentioned being a total of $73,000,000 is necessary to be raised by taxation to meet
the payment of bond redemption and interest on Port of Seattle General Obligation Bonds, of future
expenditures for acquisitions and capital improvements, and of costs for such general purposes allowed by law
which the Port deems necessary, as set forth for the period January 1, 2013 and thereafter; that said King
County Council be respectfully requested to make a levy in said amount for the aforesaid purposes; and
BE IT FURTHER RESOLVED, that the above is a true and complete listing of levies for said
District for collection in the year 2013 and they are within the maximums established by law.
ADOPTED by the Port Commission of the Port of Seattle at a regular meeting held this ____ day of
________________________, 2012, and duly authenticated in open session by the signatures of the
Commissioners voting in favor thereof and the seal of the Commission.
Port Commission
Filename: Stat_bud.doc
Updated: 2/20/2013
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Port of Seattle
Statutory Budget
2013 Budget and Business Plan
D. TAX LEVY CALCULATION SHEET
TABLE XII-1: TAX LEVY CALCULATION SHEET
.
TAXING DISTRICT:
Port of Seattle
The following determination of your regular levy limit for 2013 property taxes is provided by the King County Assessor
pursuant to RCW 84.55.100.
(Note 1)
Using Limit Factor
For District
89,832,947
1.0100
90,731,276
2,032,036,062
0
2,032,036,062
0.22982
467,003
91,198,279
0
91,198,279
313,838,474,995
0.29059
0
0
0
91,198,279
91,198,279
266,117
91,464,396
91,464,397
0.29144
73,000,000
17,731,276
24.29%
Calculation of Limit Factor Levy
Levy basis for calculation: (2012 Limit Factor) (Note 2)
x Limit Factor
= Levy
Local new construction
+ Increase in utility value (Note 3)
= Total new construction
x Last year’s regular levy rate
= New construction levy
Total Limit Factor Levy
Annexation Levy
Omitted assessment levy (Note 4)
Total Limit Factor Levy + new lid lifts
 Regular levy assessed value less annexations
= Annexation rate (cannot exceed statutory maximum rate)
x Annexation assessed value
= Annexation Levy
Using Implicit
Price Deflator
89,832,947
1.0295
92,483,019
2,032,036,062
0
2,032,036,062
0.22982
467,003
92,950,022
0
92,950,022
313,838,474,995
0.29617
0
0
Lid lifts, Refunds and Total
+ First year lid lifts
+ Limit Factor Levy
= Total RCW 84.55 levy
+ Relevy for prior year refunds (Note 5)
= Total RCW 84.55 levy + refunds
Levy Correction: Year of Error ______ (+or-)
ALLOWABLE LEVY (Note 6)
Increase Information (Note 7)
Levy rate based on allowable levy
Last year’s ACTUAL regular levy
Dollar increase over last year other than N/C – Annex
Percent increase over last year other than N/C – Annex
Calculation of statutory levy
Regular levy assessed value (Note 8)
x Maximum statutory rate
= Maximum statutory levy
+Omitted assessments levy
=Maximum statutory levy
Limit factor needed for statutory levy
0
92,950,022
92,950,022
266,117
93,216,139
93,216,139
0.29702
73,000,000
19,483,019
26.69%
313,838,474,995
0.45000
141,227,314
0
141,227,314
Not usable
ALL YEARS SHOWN ON THIS FORM ARE THE YEARS IN WHICH THE TAX IS PAYABLE.
Please read carefully the notes on the reverse side.
Filename: Stat_bud.doc
Updated: 2/20/2013
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Port of Seattle
Statutory Budget
2013 Budget and Business Plan
Notes:
1) Rates for fire districts and the library district are estimated at the time this worksheet is produced.
Fire district and library district rates affect the maximum allowable rate for cities annexed to
them. These rates will change, mainly in response to the actual levy requests from the fire and
library districts. Hence, affected cities may have a higher or lower allowable levy rate than is
shown here when final levy rates are calculated.
2) This figure shows the maximum allowable levy, which may differ from any actual prior levy if a
district has levied less than its maximum in prior years. The maximum allowable levy excludes
any allowable refund levy if the maximum was based on a limit factor. The maximum allowable
levy excludes omitted assessments if the maximum was determined by your district’s statutory
rate limit. If your district passed a limit factor ordinance in the year indicated, that limit factor
would help determine the highest allowable levy. However, if the statutory rate limit was more
restrictive than your stated limit factor, the statutory rate limit is controlling.
3) Any increase in value in state-assessed property is considered to be new construction value for
purposes of calculating the respective limits. State-assessed property is property belonging to
inter-county utility and transportation companies (telephone, railroad, airline companies and the
like).
4) An omitted assessment is property value that should have been included on a prior year’s roll but
will be included on the tax roll for which this worksheet has been prepared. Omits are assessed
and taxed at the rate in effect for the year omitted (RCW 84.40.080-085). Omitted assessments
tax is deducted from the levy maximum before calculating the levy rate for current assessments
and added back in as a current year’s receivable.
5) Administrative refunds under RCW 84.69.020 were removed from the levy lid by the 1981
legislature.
6) A district is entitled to the lesser of the maximum levies determined by application of the limit
under RCW 84.55 and the statutory rate limit. Levies may be subject to further proration if
aggregate rate limits set in Article VII of the state constitution and in RCW 84.52.043 are
exceeded.
7) This section is provided for your information, and to assist in preparing any Increase Ordinance
that may be required by RCW 84.55.120. The increase information compares the allowable levy
for the next tax year with your ACTUAL levy being collected this year. The actual levy excludes
any refund levy and expired temporary lid lifts, if applicable. New construction, annexation and
refund levies, as well as temporary lid lifts in their initial year, are subtracted from this year’s
allowable levy before the comparison is made.
Assessed valuations shown are subject to change from error corrections and appeal board
decisions recorded between the date of this worksheet and final levy rate determination.
Filename: Stat_bud.doc
Updated: 2/20/2013
XII - 5
Port of Seattle
Statutory Budget
2013 Budget and Business Plan
E. FORECASTED CASH FLOW SUMMARY
TABLE XII-2: FORECASTED CASH FLOW SUMMARY
($ in 000's)
2013
Beginning balance of cash & investments
$ 774,038
SOURCES OF CASH
Operating Revenues
Interest Receipts
Proceeds from Bond Issues
Grants and Capital Contributions
Tax Levy
Passenger Facility Charges
Rental Car Customer Facility Charges
Fuel Hydrant Receipts
Other Receipts
Total
550,579
7,296
0
18,977
73,000
64,844
20,553
7,839
713
743,800
Anticipated available funds
USES OF CASH
Expenses from Operations:
Operating & Maintenance Expense
Corporate Administrative Expense
Law Enforcement Costs
Environmental Expenditures
Total Operating Expenses
Debt Service:
Interest Payments
Bond Redemptions
Total Debt Service
Percent
of Total
74.0%
1.0%
0.0%
2.6%
9.8%
8.7%
2.8%
1.1%
0.1%
100%
1,517,840
240,510
59,970
22,568
5,865
328,912
28.1%
7.0%
2.6%
0.7%
38.4%
288,291
17.4%
16.2%
33.7%
9,485
4,469
225,503
856,661
1.1%
0.5%
26.3%
100%
149,346
138,945
Other Expenses
Public Expense
Capital Expenditures
Total
Ending balance of cash & investments
$ 661,178
Increase (decrease) of cash during year
$ (112,860)
cashflow.xlsx
Filename: Stat_bud.doc
Updated: 2/20/2013
XII - 6
Port of Seattle
Statutory Budget
2013 Budget and Business Plan
FIGURE XII-1: SOURCES OF CASH
($ in 000’s)
FIGURE XII-2: USES OF CASH
($ in 000’s)
Filename: Stat_bud.doc
Updated: 2/20/2013
XII - 7
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Filename: Stat_bud.doc
Updated: 2/20/2013
XII - 8
Port of Seattle
Appendices
2013 Budget and Business Plan
APPENDIX A: BUDGET POLICY, PROCESS AND CALENDAR
1. OPERATING BUDGET
a. Budget Policy:
The Port established a budget policy to provide systematic planning as part of the management performance
and control. The purpose of this policy is to allow the capability to forecast realizable financial results over
definite periods of time. This is accomplished through planning and coordination of the various complex
operations and functions of the Port, through systematic communication and the use of the Port’s financial
control and management information system.
The Operating Performance Budget is viewed as year one of the business plans and as such, it is an essential
component of the management planning and control process. It quantifies business groups and departmental
plans for future periods in strategic, operational and monetary terms. This facilitates coordination of plans
between divisions/departments and provides a basis for control once the plan is in effect.
Various inputs to the budget planning process are required for it to be meaningful, including forecast of
economic trends and business activity levels. Above all, goals, objectives, programs, action plans and
performance measures are defined and reviewed annually for consistency and support of the Port’s overall
mission.
The budget plan is based on assumptions about the success of marketing efforts, demand for services, and the
cost, availability and need for people and materials. The budget process provides continual feedback which
compares not only actual performance to the plan but also the validity of the assumptions on which the plan
was based.
The Operating Performance Budget is a management tool for controlling and analyzing each area of
responsibility. Budgeting as well as the recording of actual costs is done on an Org basis. An Org is a
distinct functional and physical unit. Its performance responsibility can be assigned to one person. There are
over 200 Orgs at the Port. Each Org has a budget. The person assigned to each of these Org budget is
responsible for the operating costs of that Org. Budgeting is done on a line-item basis for Revenues and
Operating & Maintenance Expenses.
Allocated and/or indirect expenses are not budgeted for by the recipient Org. These are costs that are
allocated to business groups/unit from service providers based on the Port’s standard allocation formula or
using an alternative allocation methodology. Allocated costs are general support costs that cannot be directly
attributed to a business unit, but instead support the entire Port. Costs can come from within the division
(intra-division allocation) or from outside the division (inter-department allocation).
Department Directors are responsible for preparing the operating budget for their areas of responsibility,
subject to review and approval by several levels within the organization. Orgs can be combined to analyze
and report on budgets by functional or business units. Port management needs current, timely and accurate
information to make informed decisions in a timely manner. The objective of the budget process is to
provide responsibility performance, financial and statistical information, to enhance effective management.
In addition to providing the business plan for the organization, this process results in a method of comparing
actual financial results with the approved budget plan. The appropriateness of the pricing structure or the
effects of changes in costs or activity can be observed. This approach gives management the flexibility to
evaluate the performance of a particular activity. The Budget Report (compares the proposed budget to the
current year’s budget and last year’s actual) and the Responsibility Report (compares actual results to budget)
can advise a manager if things are not going as expected, whether strategies are being accomplished, and also
give him/her clues as to what might be wrong. The function of controlling and managing the operations of
the Port is accomplished with the Operating Performance Budget.
Filename: _13 Appendices
Updated: 12/28/2009
XIII-1
Port of Seattle
Appendices
2013 Budget and Business Plan
The 2013 budget process included several Commission briefings with the operating divisions and corporate
departments during the year to update the Commission on key issues facing the business groups and to solicit
input into overall strategies and objectives. The divisions updated the Commission on each business unit
with background information, discussing capital and operating plans and dialogue on major policy issues.
Divisions fine-tuned their business plans based on Commission input and put together budgets based on
revised business plans.
Key events included budget planning meetings by the Executive Management team, the issuance of the
budget guidelines/instructions and budget calendar to divisions, training of budget users on usage of the
budget system, actual preparation of the budget by divisions and departments, internal budget reviews, which
includes in-depth discussion of revenue and expense assumptions, new programs, initiatives, or other
proposed increases in revenue, expenses as well as operational needs, review and agreement by the
Commissioners and Executive Management, and release of the updated proposed budget to the Port
Commission and public stakeholders.
Budget staff responded to inquiries of commission and interested stakeholders during commission budget
workshops, first and second reading and adoption of the budget following public hearings.
In addition to the Operating Performance Budget as stated above, the budget staff prepares the Statutory
Budget as defined in RCW 53.35.010 to show ―estimated expenditures and the anticipated available funds
from which all expenditures are paid.‖ Being a cash budget, the Statutory Budget establishes the level of the
Port’s property tax levy and sets upper limits of expenditures, and is not used as an Operating Performance
Budget.
b. Budget Adoption:
The budget is provided to the Port Commission and must be made available to the general public as required
by law - RCW 53.35.010 and RCW 53.35.045. A Public Hearing in the First Budget Reading is held before
the Second Reading and Final Passage of Budget, at which time the Port Commission will make final
recommendations and adopt the budget at a regular commission meeting and duly authenticated in open
session with an announcement of the public hearing be made in the DAILY JOURNAL OF COMMERCE
newspaper and copies of the preliminary budget be made available for distribution to any interested persons
by a specified date as required by law - RCW 53.35.020 and RCW 53.35.045.
Subsequent to the public hearing and Commission adoption of a final plan, the statutory budget and
resolution is then filed with the King County Council and King County Assessor as required by law, by a
specified date as allowed by RCW 53.35.045.
c. Monitoring of Budget:
Once an annual budget is in place, the Responsibility Report (comparing actual results to budget) is
generated monthly and variances from budget are analyzed and reported on a monthly basis, and more
extensively each quarter, to determine if corrective action is needed. Divisions and departments prepare a
quarterly year-end forecast, which is incorporated into the quarterly Performance/Variance Report. The
Performance/Variance Report is a report in narrative form explaining the reason or causes of variances
between actual revenues and expenses versus budgeted amounts on a quarterly basis. A good and accurate
monthly and quarterly performance/variance report is a very important tool for management. This report
provides explanation of variances from the approved plan and presented quarterly to Executive Management
and the Commission in public meetings. This allows Executive Management and the Commission to make
timely and well-informed decisions.
Filename: _13 Appendices
Updated: 12/28/2009
XIII-2
Port of Seattle
Appendices
2013 Budget and Business Plan
d. Amending the Operating and Capital Budgets:
The Chief Executive Officer of the Port of Seattle is authorized ―Within Budget Limits‖ to transfer budgeted
amounts between departments; however, any revisions that alter the total expenses Port-wide that are not
within the Chief Executive Officer Authorized Budget Limits require authorization from the Port
Commission.
As per Resolution 3605 as amended, whereas the Port Commission has adopted policy directives delegating
administrative authority to the Chief Executive Officer for the purpose of day-to-day management and
administration of the Port and as stated in sections 20.2.1 and 20.2.2 of said resolution:
20.2.1 ―Within Authorized Budget Limits‖ means with respect to capital projects, improvements or
acquisitions, the term ―Within Authorized Budget Limits‖ means that the project, improvement or
acquisition:
(i) Is included in the Port’s Annually Approved Capital Budget, or
(ii) Is included in the Port’s Annually Reviewed Capital Improvement Plan
(iii) Will not cause the Port to exceed the total approved dollar limit of the current Annually Approved
Capital Budget.
20.2.2 ―Within Authorized Budget Limits‖ means with respect to non-capital expenditures, that the
expenditure:
(i) Is included in the total approved dollar limit of the Port’s current Annual Operating Budget.
(ii) Will not cause the Port to exceed the total approved dollar limit of the Port’s current Annual
Operating Budget.
e. Operating Performance Budget Process:
The steps in the 2013 operating budget process are as follows:

Budget planning meetings of Executive Management to set 2013 operating targets.

Commission strategic and business planning briefing.

Training of budget users from the various divisions on the use of the budget system.

Commission briefing on budget process and key assumptions.

Issuance of budget guidelines/instructions and budget calendar on the Port’s intranet.

For the operating divisions, targets are developed based on the divisions’ business plan forecast.

For Capital Development Division and Corporate, initial targets are based on a bottom-up assessment of
needed resources to accomplish strategy/actions plans.

Several Commission briefings with the operating divisions and corporate departments are held during the
year to update the Commission on key issues facing the business groups/departments and to solicit input
into any changes in strategy.

Budget system available for input.

Actual preparation of the budget by divisions/departments.

Costs of service departments are allocated to operating divisions according to policy.

Corporate Finance and Budget generates budget comparison report, which compares the proposed budget
to the current year’s budget and last year’s actual, and also produces the current year’s Forecast Report.

Divisions/departments complete their detailed budgets and are reviewed internally by their senior
managers and finance and budget staff, which include in-depth discussion of revenue and expense
assumptions, new programs, initiatives, or other proposed increases in revenue, expenses as well as
operational needs.

Divisions/departments budgets are submitted to Corporate Finance and Budget and then reviewed against
targets by Executive Team.

Executive Team makes recommendations and changes, which are incorporated into divisions and
departments budgets.
Filename: _13 Appendices
Updated: 12/28/2009
XIII-3
Port of Seattle
Appendices









2013 Budget and Business Plan
Several Commission budget briefings are held on divisions/departments capital budget, operating budget,
and Draft Plan of Finance.
All budget issues are resolved and changes are entered and made into the budget system.
Corporate Finance and Budget staff generates various reports in a timely manner and ascertains that all
approved changes are incorporated into the budget and reports are accurate.
Corporate Finance and Budget prepares preliminary budget document and releases proposed budget to
the Port Commission and the public on October 25, 2012.
The First Reading and Public Hearing of the budget on November 13, 2012.
The Second Reading, Final Passage and Adoption of the 2013 budget on November 27, 2012 at which
time the Port Commission makes final recommendations and adopts the budget.
Filing the Statutory Budget with King County Council and King County Assessor as required by law on
November 29, 2012.
Corporate Finance and Budget staff prepares and releases the final budget document to reflect
Commission recommendations.
Corporate Finance and Budget staff set commitment control for Corporate and Capital Development
Division departments and operating divisions.
Filename: _13 Appendices
Updated: 12/28/2009
XIII-4
Port of Seattle
Appendices
2013 Budget and Business Plan
FIGURE A-1: OPERATING BUDGET PROCESS FLOW CHART
OPERATING BUDGET PROCESS FLOW
CHART
Strategic Planning
Meetings of Executive
Management to set
Targets
Divisions/Departments
Submit Budgets
Executive Management
Reviews
Divisions/Departments
Budget and Makes
Recommendations and
Changes
Commission Strategic
Planning Briefing on
Budget Process
Issuance of Budget
Guidelines/Instructions
and Calendar on the
Port’s Intranet
Divisions/Departments
Internal Budget Reviews
Proposed Budget Made
Available for First &
Second Readings
Budget Comparison
Reports are made
Available
Commission
Reviews Budget
Training of Budget Staff
and Preparation of
Budget by
Divisions/Departments
Several Commission
Briefings with
Divisions/Departments
are held to update
Commission on Key
Issues
Commission Adopts
Budget
Budget Filed with King
County Council and
King County Assessor
Filename: _13 Appendices
Updated: 9/21/2010
XIII-5
Port of Seattle
Appendices
f.
2013 Budget and Business Plan
Operating Performance Budget Planning Calendar:
Date
7/20/12
7/30/12
7/30 - 10/16/12
7/31 – 8/08/12
8/03/12
8/03/12
8/14/12
8/14/12
8/14/12
8/15 - 8/30/12
9/05/12
9/10/12
9/04 -9/21/12
9/18/12
9/18/12
9/20/12
9/21/12
10/02/12
10/09/12
10/08-10/19/12
10/11/12
10/15–10/19/12
10/16/12
10/23/12
10/23/12
10/25/12
11/13/12
11/27/12
11/29/12
12/14/12
Activity
Executive Management Budget Planning meeting
Budget System Available for Input
Preparation of budget by divisions/departments
Budget User Training
Budget Guidelines/Instructions and calendar available on the Port’s Intranet
Allocation templates available for review
Commission Briefing on 2013 Budget Process, Key Assumptions & Targets
Seaport & Real Estate Strategy/Business Plan Commission Presentation
Aviation Strategy/Business Plan Commission Presentation
Budget Staff conducts Budget Workshops to assist budgeteers with budget
Corporate Departments and Capital Development Division final budget entry
Corporate Departments and Capital Development Budget Support Documentation and
Non-Operating Budgets due to Corporate Finance and Budget
Aviation, Seaport and Real Estate Internal Budget Reviews
Executive Management reviews of Corporate and Capital Development Budgets (both
Operating & Capital Budgets)
All Corporate Budget Issues resolved
Executive Management reviews of Seaport & Real Estate Budgets (both Operating &
Capital Budgets)
Executive Management reviews of Aviation’s Budget (both Operating and Capital
Budgets)
Commission Meeting to review Divisions and Corporate Capital Budgets
Commission Meeting to review Divisions and Corporate Operating Budgets
Capacity Funding Analysis
All Outstanding Budgets Issues resolved
Corporate Finance and Budget Staff prepares 2013 preliminary budget document
All Divisions Budgets and documents due to Corporate Finance & Budget
Draft Plan of Finance Commission Briefings
Preliminary Budget Document available to Commission
2013 Preliminary Budget & Business Plan document is released and available to
Commission and Public
First Reading and Public Hearing of 2013 Preliminary Budget & Business Plan
Second Reading, Final Passage and Adoption of the 2013 Budget & Business Plan
Filing of Budget with King County Council & King County Assessor as required by law
Final 2013 Budget and Business Plan and Draft Plan of Finance document is published
Filename: _13 Appendices
Updated: 9/21/2010
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Port of Seattle
Appendices
2013 Budget and Business Plan
2. CAPITAL BUDGET
a. Capital Budget Policy:
As part of the Strategic Budgeting process, Corporate Finance and Budget (F&B) produces the
Capital Budget and the Draft Plan of Finance. The Capital Budget consists of capital plans or
Capital Improvement Programs (CIP), over a five-year period, for all divisions: Aviation,
Seaport, Real Estate, Capital Development, and Corporate. The Draft Plan of Finance is a
funding plan of the CIP that the Port publishes on an annual basis.
The divisions review and revise their CIP in conjunction with the review of their existing
business plans and strategies. The CIP is comprised of at least Committed projects from the 2012
CIP, less any that have been deleted, plus any Prospective projects that may meet the criteria to
move forward to Committed status. The CIP may include Business Plan Prospective projects if
coverage targets are met. Divisions are encouraged to review CIP cash flows with respect to
timing and reasonableness to ensure effective use of capital capacity.
b. Capital Budget Process:




A preliminary capacity/funding analysis will be performed once the 2nd quarter update is
completed, but no later than by the end of August.
At the end of September, divisions will submit to Corporate Finance & Budget (F&B) the
CIP based on their updated business plans and 2012 forecasted actual (which includes actual
through second quarter). The funding implications of these capital plans will be reviewed
with the divisions and business units.
Following F&B funding analysis and Executive review of preliminary plans, business units
and divisions will finalize their business plans including their CIP for 2013 -2017.
This information will then be reviewed with Executive, presented to the Commission,
included in the 2013 Budget and Business Plan document.
After the close of the 2012 fourth quarter in January 2013, and based on the 2012 fourth quarter
CIP update the divisions should have more refined capital spending estimates for 2013. Each
division may choose to adjust the spending for the original list of projects in the Annually
Approved Capital Budget, to establish the 2013 approved funding amount for each project and for
divisions as a whole. The adjusted Annually Approved Capital Budget will become the
―Approved 2013 Capital Budget‖ and will be the standard versus the Annually Approved Capital
Budget for quarterly variance reporting during the year.
Note: Even though the Commission reviews the Capital Budget in November, each individual
CIP project, with total costs in excess of $300,000, is presented and approved by the Commission
in public meeting for spending authority.
Filename: _13 Appendices
Updated: 9/21/2010
XIII-7
Port of Seattle
Appendices
2013 Budget and Business Plan
FIGURE A-2: CAPITAL BUDGET PROCESS FLOW CHART
CAPITAL BUDGET PROCESS FLOW CHART
Preliminary
Capacity/Funding Analysis
Performed
Proposed Capital Budget
Made Available
Simultaneously with the
Operating Budget for 1st &
2nd Readings
Commission
Reviews Capital
Budget & Draft
Plan of Finance
Filename:_13 Appendices
Updated: 12/28/2009
Divisions Submit to F&B CIP
based on updated Business
Plans & 2012 Forecasted
Actual
All Final Documents due to
F&B
Commission Adopts Budget
XIII-8
Funding Implications are
reviewed with Divisions &
Business Units
Business Units and Divisions
Finalize Business Plans
including CIP for 2013-2017
Commission Briefings are
Held
Information is reviewed with
Executive Management and
Makes Recommendations
Port of Seattle
Appendices
2013 Budget and Business Plan
c. Capital Budget Planning Calendar:
Following is the proposed 2013 capital budget planning calendar:
Date
Activity
7/27/12
CIP 2nd Quarter Update completed (including funding)
8/14/12
Commission Briefing - Business and Capital Plans
8/24/12
Preliminary Non-Aviation (Seaport, Real Estate, Corporate, CDD) Forecast Models due
to F&B
8/27-9/7/12
9/14/12
Preliminary Non-Aviation capital capacity analysis by F&B
Preliminary Aviation Forecast Model due to F&B
9/18-9/21/12
Executive Review of Capital Budgets for all divisions
9/25/12
F&B creates ―CAPBUD‖ database from Projects
10/2/12
Commission Briefing - Aviation, Seaport, Real Estate, Corp. & CDD Capital Budgets
10/8/12
Aviation, Seaport, Real Estate, Corporate and CDD Forecast Model due to F&B
(CIP must match PSFS)
10/8-10/12/12
Capacity/Funding Analysis (Port-wide preliminary) by F&B
10/15-10/19/12
Finalize Capacity/Funding Analysis – F&B
10/16/12
All divisions budget final documents due to F&B
10/23/12
10/23/12
Preliminary Budget Document available to Commission
Commission Briefing - Draft Plan of Finance
10/25/12
11/13/12
Release of 2013-2017 Capital Budget as part of the Preliminary 2013 Budget and
Business Plan document
First Reading and public hearing of the 2013 Budget
11/27/12
Second Reading and Final Passage and Adoption of the 2013 Budget
12/14/12
Release of 2013 Final Budget, Business Plan and Draft Plan of Finance document
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APPENDIX B: FINANCIAL MANAGEMENT POLICIES
The primary purpose of the Port is to broaden and strengthen the economic base of the port district. The Port
uses key criteria in various combinations as it pursues its capital and operating programs and projects. Clearly,
national and international economic strengths or weaknesses have a direct bearing upon the Port’s financial
viability and role as an economic engine for the region.
1.
KEY FINANCIAL TOOLS
The Port uses several tools to monitor its financial performance and these are described below
a. Long-term Target: The Port’s long-term targets provide high-level policy guidance. These targets
provide guidance to the business plans created by each division.
b. Business Plans: The business plans set the strategic direction and priorities for each division. The
business plans are a planning tool, which link operations, capital investments, and the interests of the
Port’s customers and the community.
c. Operating Performance Budget: The Operating Budget is a one-year slice of the business plans. It is an
essential component of the Port’s management planning and control process. It quantifies line of business
and departmental plans for the next year in both operational and monetary terms. Throughout the year, the
Responsibility Reports (which compare actual results to budget) are generated monthly and variances from
budget are analyzed on a monthly basis, and more extensively each quarter, to determine if corrective
action is needed. Divisions and departments prepare a quarterly forecast, which is incorporated into the
quarterly Performance Report, which provides explanation of variances from the approved plan and is
presented quarterly to Executive Management and Commission in public meetings, as necessary.
d. Balanced Budget: The Port prepares an annual budget and supports, encourages and commits to a
balanced budget in which revenues exceed expenses. In so doing, the practice is to pay for all current
operating expenses with current revenues and not postpone current year operating expenses to future years
or accrue future year’s revenues to the current year. The Port’s policy further requires that budgeted
operating expenses do not exceed budgeted revenues, and on-going expenses do not exceed on-going
revenues.
e. Operating Forecasts: Included in the budget document are five-year forecasts or projections of the
division’s operating revenues and expenses. The first year of this forecast is the Operating Performance
Budget.
f.
Capital Budget: A detailed plan of proposed outlays or capital expenditures arising from the acquisition
or improvement of the Port’s fixed assets and the means of financing them through bond proceeds, grants
and operating revenues. This document serves as an operational and planning tool and it is directly tied to
the business plans. The document identifies proposed capital projects at the airport and on the waterfront
and prioritizes those projects.
g. Capital Expenditures: Expenditures that arise from the acquisition or improvement of the Port’s fixed
assets. Port assets are given a useful life of more than three years when they become active. The
expenditures reflected in the capital budget cover projects anticipated to provide modernized Airport,
Seaport, and Real Estate facilities for sustained growth of the Port.
h. Capital Budget Impact on the Operating Budget: Its impact on the Operating Budget is through
Capitalized Labor or Charges to Capital Projects, which include the salaries and benefits costs associated
with capital projects. These costs are subtracted out of the operating budget and then budgeted in the
capital budget as part of the cost of the project(s). It is also impacted in the form of increased operating,
maintenance and depreciation expenses because of the new assets. Depreciation is a non-cash item that
represents the use of long-term assets. Port assets are given a useful life of more than three years when
they become active and each year some of that useful life is used up, worn or depreciated.
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The capitalized labor or charges to capital projects is displayed in table III-3 and the depreciation is
displayed in table III-2. The capitalized labor is also displayed in similar tables in section IV thru VIII.
i.
Plan of Finance: The Five-year Capital Budget is the basis of the Plan of Finance. This document
provides a funding plan of the capital program developed within the financial targets and forecasts
described within the Draft Plan of Finance section. The Draft Plan of Finance is prepared and presented to
the Port Commission concurrently with the Operating Budget. See further discussion in the Draft Plan of
Finance, section XI.
j.
Capital Investment Matrix: The matrix provides an analytical framework for capital projects. The
results of the analysis provide financial and non-financial information for the Port Commission as a guide
for capital investment decisions.
k. Financial and Operational Indicators Report: The Port uses financial and operating indicators to
monitor its financial performance and budget. The reports are produced and distributed monthly to the
Port Commission and Executive Management.
l.
Treasury Management: Using its internal Treasury since July 2002, the Port has experienced increased
investment earnings, faster mobilization of funds, on-line banking capabilities, reconciliation and full
control of its cash and investments.
m. General Coverage Ratios and Cash Flow Margins: As part of its financial modeling, the Port targets
that Airport cash flow equals 1.25 times of all Airport related revenue debt and that Seaport cash flow
equals 1.5 times of all Seaport related revenue debt. In addition, the Port targets general obligation bond
debt service not to exceed any more than seventy-five percent of the annual tax levy.
n. Bond Coverage Ratios: The Port, through financial modeling, runs projections for its revenue bond debt
service coverage ratio. Although the Port has an obligation under First Lien Revenue Bond covenants to
maintain a ratio of 1.35, as a matter of practice a ratio of at least 1.8 is maintained. Debt service coverage
may fall below this target level during periods of construction borrowing prior to the time that revenue
producing assets come on-line.
o. Fund Balances: Working capital fund balances are maintained in the General Fund and the Airport
Development Fund at a targeted level of approximately nine months of operating and maintenance
expenses. The Port maintains $5 million in the Renewal and Replacement Fund as required by bond
documents.
p. Performance/Variance Report: A report in narrative format explaining the reason or causes of variances
between actual revenues and expenses versus budgeted amounts on a quarterly basis. A good and accurate
monthly and quarterly performance/variance report is a very important tool for management. Divisions
and departments prepare a quarterly year-end forecast, which is incorporated into this report and it is
presented quarterly to Executive Management and the Commission in public meetings.
q. Commitment Control: The Port has in place a commitment control ledger that monitors department
budgets which prevents departments from exceeding their total budget without approval.
2. FINANCIAL POLICIES AND DESCRIPTION OF MAJOR FUNDS
This section, pages XIII-11 through 17 presents a summary of the Port’s major financial policies and
description of its major funds.
a. Organization: The Port of Seattle (the "Port") is a municipal corporation of the State of Washington,
organized on September 5, 1911, through enabling legislation by consent of the voters within the Port
district. In 1942, the local governments in King County selected the Port to operate the Seattle-Tacoma
International Airport (the "Airport"). The Port is considered a special purpose government with a
separately elected commission of five members and is legally separate and fiscally independent of other
State or local governments. The Port has no stockholders or equity holders. All revenues or other receipts
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must be disbursed in accordance with provisions of various statutes, applicable grants, and agreements
with the holders of its bonds.
b. Reporting Entity: The Port reports the following fund: the Enterprise Fund accounts for all activities and
operations of the Port.
The Enterprise fund is used to account for operations and activities that are financed at least in part by fees
or charges to external users of Airport Facilities, Seaport and Real Estate properties. Therefore, the Port of
Seattle summarizes all of its fund activities in the Enterprise Fund. This includes the Port's major business
activities, which are comprised of three operating divisions - Aviation, Seaport, Real Estate; a new Capital
Development division and a Corporate division. The Aviation Division ("Aviation") serves the
predominant air travel needs of a five-county area. The Airport has 19 U.S.-flag passenger air carriers
(including regional and commuter air carriers) and ten foreign-flag passenger air carriers providing daily
nonstop service from the Airport to 97 cities, including 19 foreign cities.
The Seaport Division’s ("Seaport") primary focus is on facilities that serve large vessels including
containerized and non-containerized cargo ships and cruise ships. The Seaport is a landlord port with
major tenants including shipping companies, terminal operators and other maritime related businesses.
The Seaport’s container business involves the leasing of property and equipment used primarily for the
transfer of international containerized cargo arriving by ship to various modes of land transportation
destined for the Pacific Northwest and for other regions of the country and the reverse transfer of domestic
goods and empty containers arriving by rail or truck to outbound ships for distribution to other countries
around the world.
The Real Estate Division incorporates projects, functions and resources from the Seaport, and the Airport.
The Real Estate Division manages the Port’s holdings in commercial real estate, recreational marinas,
industrial fishing terminals and developable property.
The divisions have labor workforces subject to various collective bargaining agreements. These
workforces support the operations and maintenance of the divisions.
The new Capital Development Division was established during 2008 and became fully operational during
2009. It houses existing engineering, project management and construction functions and the Port’s new
Central Procurement Office, which consolidates contracting and procurement functions.
The Corporate division provides various support services to the operating divisions. Capital Development
Division and Corporate expenses are allocated and charged to the operating divisions.
Within the Enterprise Fund, the Port segregates non-operating expenses made to public entities which are
funded by the ad valorem tax levy. This includes expenses for district schools and infrastructure
improvements to the state and region in conjunction with other agencies. These projects are controlled by
other governmental entities and are not reflected in the Port's financial statements.
c. Basis of Accounting and Budgeting: The Port does not distinguish between the Basis of Accounting and
the Basis of Budgeting since the principles set forth as the Basis of Accounting are observed in the
budgeting process. The Port is accounted for on a flow of economic resources measurement focus. The
financial statements and the budget are prepared in accordance with accounting principles generally
accepted in the United States of America as applied to governmental units using the accrual basis of
accounting under which revenue transactions are recognized when earned and expenses are recognized
when incurred, regardless of the time the cash is received or disbursed. The Government Accounting
Standard Board ("GASB") is the accepted standard-setting body for establishing governmental accounting
and financial reporting principles. GASB Statement No. 20, Accounting and Financial Reporting for
Proprietary Funds and Other Governmental Entities that Use Proprietary Fund Accounting, requires that
governments' proprietary activities apply all GASB pronouncements as well as the pronouncements of the
Financial Accounting Standards Board ("FASB") and its predecessors issued on or before November 30,
1989, unless those pronouncements conflict with or contradict GASB pronouncements. As allowed by
GASB Statement No. 20, the Port has elected to implement FASB Statements and Interpretations issued
after November 30, 1989.
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d. Use of Estimates: The preparation of the Port’s budget in conformity with accounting principles generally
accepted in the United States of America requires management to make estimates and assumptions in
reporting of revenues and expenses in certain instances. Thus actual amounts could differ from those
estimates.
e. Operating Revenues: Fees for services, rents and charges for the use of Port Facilities such as:
Dockage, Wharfage, Berthage and Moorage, Airport Transportation Fees, Airport Landing Fees,
Equipment, Property Rentals and other revenues generated from the Port’s operations are reported as
operating revenue.
f.
Non-Operating Revenues: Revenues that do not result from the normal operation of the Port’s business
such as: Ad Valorem Tax Levy, Interest Income, Non-operating Grants, Passenger Facilities Charges and
Customer Facilities Charges and other revenues generated from non-operating sources are classified as
non-operating.
g. Operating & Maintenance Expenses: Cost or charges that arise from the normal operation of the Port’s
business. These are costs or services required for a department/division to function. These include Salaries
and Benefits, Equipment expense, Supplies and Stock, Travel and Other Employee expenses and all Direct
Charges, even those from Corporate and from other Divisions.
h. Non-Operating Expenses: Cost or charges that do not arise from the normal operation of the Port’s
business. An example is interest expense.
i.
Capital Policy: The Port’s policy is to capitalize all asset additions - Tangible Assets [Property, Plant
and Equipment] and Intangible Assets, if they exceed $20,000, whether it is a single payment or an
accumulation of related costs and with an estimated useful life of more than three years. Any asset costing
less than $20,000 will be expensed. Land, facilities and equipment are stated at cost, less accumulated
depreciation. Depreciation is computed on a straight-line basis. Buildings and improvements are assigned
lives of 30 to 50 years, equipment 3 to 20 years, and furniture and fixtures 5 to 10 years.
j.
Debt Policy: The Port’s debt policy is designed to ensure appropriate use and management of debt
including compliance with various laws, regulations and agreements and effective management of risk.
The policy requires use of an independent financial advisor and describes the roles of Commission and
staff. The policy describes the type and structure of debt and sets forth limitations on new debt. Key
limitations include minimum debt service coverage requirements for revenue bond debt of 1.25x for the
Airport and 1.50x for the Seaport and for Real Estate and that General Obligation bond debt service cannot
exceed 75% of the annual tax levy. The policy establishes savings targets for refunding ranging from 3%
for a current refunding with a short-term maturity/call date to 9% for a LIBOR based swap refunding with
a long-term maturity/call date. The policy also provides guidelines for the sale of bonds.
k. Description of Major Funds: There are dozens of funds that are summarized into the Enterprise Fund.
The Enterprise Fund accounts for all activities and operations of the Port. The Enterprise fund is connected
to the functional units in that it is used to account for operations and activities that are financed at least in
part by fees or charges to external users of Airport Facilities, Seaport and Real Estate properties.
Therefore, the Port of Seattle summarizes all of its fund activities in the Enterprise Fund. This includes the
Port's major business activities, which are comprised of three operating divisions - Aviation, Seaport, Real
Estate; a Capital Development division and a Corporate division. Descriptions of some of the major funds
are:
Types of Funds
Fund Name
1. Operating Airport
Development
Fund (ADF)
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Fund #
03040
Fund Description
This is the operating fund for the Seattle-Tacoma International
Airport (Aviation division). The fund receives operating
revenues derived from all airport sources, and it funds operating
and maintenance expenses related to the Airport. The fund also
receives Airport Improvement Program grants reimbursement
receipts. Transfers made from this fund include funding for
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Types of Funds
Fund Name
Fund #
Fund Description
Aviation related revenue bond fund debt service. Capital
acquisition expenditures which are not otherwise funded are also
made from this fund. Other expenditures include: operating and
administrative expenses and non-operating expenditures
associated with AVPMG, Corporate and CDD operating
expenses and capital expenditures that are allocated to Aviation.
General Fund
00010
The general fund is the operating and capital fund for all Portowned properties with the exception of the Seattle-Tacoma
International Airport (Aviation). Operating revenues derived
from all sources other than the Aviation division or the
Industrial Development Corporation are deposited to this fund.
The fund also receives non-operating revenues that are
associated with the Seaport/Real Estate divisions or are
corporate in nature. Expenditures from this fund include:
• Seaport division operating and administrative expenses;
capital equipment purchases and construction projects,
excluding projects funded with other funding sources;
• Real Estate division revenues & expenses flow through the
general fund, however, as directed by Port Commission, certain
Real Estate division expenses and capital projects may be
funded from the tax levy fund;
• Operating expenses for Corporate and CDD divisions allocated
to the operating divisions; anything directly allocated to an
operating division is paid from the appropriate operating fund,
General Fund for Seaport/Real Estate and the Airport
Development Fund for Aviation;
• Corporate and CDD divisions capital equipment purchases
and capital projects that are ultimately allocated to the operating
divisions through allocated depreciation and appropriate
portions of capital that is split between the two operating
divisions;
• Non-operating expenditures that are directly associated with
the Seaport, CDD or Corporate in nature.
• Port payrolls, purchases of materials, supplies and services,
and non-Aviation capital acquisition expenditures which are not
otherwise funded are made from this fund. Periodic reports are
generated indicating what general fund monies have been
expended for payrolls or accounts payable that properly should
have been paid out of the other funds. These amounts will then
be transferred from such other funds to the general funds as
reimbursements.
General Fund
Reserve (GFR)
00011
Established in 2007, the GFR is a sub-fund of the General Fund.
It can be used for any lawful purpose just the same as the
General Fund. Finance & Budget staff will evaluate this fund
annually to review its balance relative to General Fund and/or
other general purpose funds the Port may have, the annual
contribution amount, and to assess the need to have this fund.
Tax Levy
00020
The Tax Levy fund was established in 2002 and is used to
receive the ad valorem taxes levied on real properties within the
Port's District (King County). Prior to 2002, the tax levy
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Types of Funds
2. Special
Facility
Fund Name
Fund #
Fund Description
proceeds were deposited into the General Fund. Other items
deposited to this fund include Receipts in lieu of taxes, Tax sales
and refunds, Investment income and expense, Tax adjustments,
Tax supplements and cancellations. Proceeds are used for
General Obligation (G.O.) bonds debt service, and to fund
capital, expense and special item projects that meet criteria
established by the Port, or as directed by Port Commission.
Transportation
& Infrastructure
Reserve (TIF)
00021
Established in 2010, as per the 2010 Commission approved
budget the TIF can be used for any lawful purpose just the same
as Tax Levy Fund. The TIF initial funding source is from the
Tax Levy fund, and the fund balance is reviewed at least
annually with Port staff and Commission.
Signatory Lease
and Operating
Agreement
(SLOA) Deposit
Surety
03042
Established in 2006, the SLOA fund is the ―Security Fund‖ as
defined in the Aviation’s 2006 Signatory Lease and Operating
Agreement, (SLOA II) section 19.2, Security Fund. Cash
transferred to this fund by the Port is held to ensure the Airlines
performance under the SLOA Agreement.
Lease Security
SSAT/T-18 Fund
03090
Customer
Deposits
06010
Passenger
Facilities
Charges (PFC) :
 Revenue
 Capital
06054
03060
Customer
Facility Charge
(CFC)
CFC01
Fuel Hydrant
Fund
 Revenue
 Debt Service
Held in
Trust
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Established December 2011, this fund represents the Lessee’s
(SSAT and SSA) Security for Rent Payment in the form of a
―Cash Security‖, to satisfy the lease’s Security Requirement.
This fund has been established as a depository of lease deposits
and other monies held by the Port as surety, but belonging to
Port of Seattle customers.
PFC Revenues are derived from passenger facility charges
levied on embarking passengers at Seattle-Tacoma International
Airport. The collected revenues are used to pay debt service on
PFC Revenue Bonds, debt service on other revenue bonds
related to FAA PFC approved projects, and for specificallydesignated airport facility improvements projects. All PFC’s
revenues are deposited to the Revenue fund (06054). From the
Revenue fund, there is a required monthly transfer of monies to
the Debt Service fund equal to 1/6th of semi-annual debt service
payment by the 25th of each month. The remaining balance of
the Revenue fund, which includes interest earnings, is then
transferred to Capital fund (03060).
Established in 2006, the CFC Fund holds revenue derived from
charges imposed upon customers of rental car companies
accessing the Airport, and taxable revenue bond proceeds issued
to fund the Consolidated Rental Car Facility (CRCF). Funds are
to be used to pay debt service on those bonds, construction costs
for the CRCF project, any future capital maintenance projects,
and specified CRCF operating expenses.
The funds accruing to the Fuel Hydrant Revenue Fund are
derived from Pledged Lease Revenue and Other Revenue as
defined in Resolution No. 3504, as amended. Funds are to be
used to pay Fuel Hydrant bonds debt service.
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Types of Funds
Fund #
Fund Description
All Fuel Hydrant revenues are deposited to the Revenue
account. From the Revenue account, there is a required monthly
transfer to the Debt Service account equal to 1/6th of the semiannual interest and 1/12th of the annual principal amounts.
Established at the time of bond issuance, the Reserve fund is
intended to be used for debt service in the event the Port cannot
repay.
Bond Funds
Various
The Port of Seattle issues bonds pursuant to bond resolutions to
fund its Capital Improvement Program. Proceeds from bond
issues are used to fund construction, capitalized interest and
reserves, see below.
Capitalized
Interest Fund
(Cap-I)
Various
Construction
Fund (CF)
Various
Debt Service
Reserve Fund
(DSRF)
Various
Debt Service
Fund (DSF)
Various
Established at the time of bond issuance, Cap-I funds are
additional bond proceeds to be used to pay interest expense
before the capital asset goes into use and is able to generate
revenue to repay principal.
Proceeds from bond issues are used for the Port’s facilities
expansions and improvements, land acquisition, and/or pay
interest. Separate funds are set up for each bond issue to allow
for the tracking and reconciliation of bond proceeds
expenditures.
Established at the time of bond issuance for the purposes of
securing the payment of principal and interest on related
outstanding bonds. Terms set forth in the bond covenants
dictate how much the Port is required to maintain in the Reserve
fund. Not all bond issues have a cash funded Reserve fund; the
Port may instead choose to maintain qualified surety and/or a
qualified letter of credit.
The DSF serves as a pass-through fund. Transfers are made
periodically to the DSF, typically on the debt service date, for an
amount sufficient to meet the debt service requirements. The
source of the funds transfer depends on the related debt and may
be made, legally, from any operating fund, but it is the Port’s
intent to make all such transfers from the General or Airport
Development Funds.


3. Debt
Related
4. Other
Operating
Fund Name
Project
Reserve
Repair and
Renewal Fund
03150
Established pursuant to Master Resolution 3577, Section 4. (b),
the proceeds of the fund may be used by the Port to pay
extraordinary operating and maintenance expenses, make capital
replacements, additions, expansions, repairs and renewals of the
facilities of the Port.
Environmental
Settlement
ENVIR
Established 2008, the fund is used for environmental settlement
money received for cleanup work the Port is engaged to do.
Consequently, there are restrictions on how proceeds are used.
Industrial
Development
Corporation
(IDC)
IDC01
The IDC of the Port of Seattle is a special purpose government
with limited powers. It was established in 1982 pursuant to
Revised Code of Washington (Chap. 39.84) for the purpose of
facilitating industrial expansion through tax-exempt financing.
The IDC fund balance is comprised of compensation of
companies that borrow through the IDC, and investment
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Types of Funds
2013 Budget and Business Plan
Fund Name
Fund #
Fund Description
earnings. IDC ―surplus‖ funds may be used for any allowable
purposes as provided by state law: allowable under the Port’s
authorized powers to engage in economic development
programs, and for growth management, planning or other
economic development purposes.
3. REVENUE AND EXPENSE ASSUMPTIONS
Operating revenues are developed based on the terms of various lease agreements and on forecasted activity
levels. Operating expenses are developed based on historical experience, forecasted activity levels and
inflation.
Aeronautical revenues are based on cost recovery. Non-airline revenues at the Airport are projected to
increase by $10.6 million or 7.1% from the 2012 budget. Seaport revenues are projected to grow by 11.9%
and Real Estate revenues are anticipated to increase by 0.4% over the 2012 budget. The key business activities
forecast for the Airport, Seaport and Real Estate divisions are as follows:






Enplaned passengers: 2.2% increased from 2012 budget
TEU’s volume: 17% decrease from 2012 budget
Cruise passengers: 3% decrease from 2012 budget
Grain volume: 38% decrease from 2012 budget (due to Midwest drought)
Marina occupancy rate: 92% compared to 94% in 2012 budget
Commercial Properties occupancy rate: 95% compared to 90% in 2012 budget
Port wide salaries for exempt and non-exempt employees are budgeted to increase by an average of 3.0% for
2013 and benefit costs are budgeted in two parts for employees in non-union jobs:

The first part represents the costs that are not salary based. This includes medical and dental benefits,
401(a) contributions, and Flexible Spending Account fees. This amount totals $1,268.60 per benefit
eligible employee per month.

The second part represents costs that are salary based. This includes FICA, PERS, life and disability
insurance as well as PTO and EI amounts. These items total 16.96% of pay.
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APPENDIX C: BUSINESS ASSESSMENT
a. Local Economy and Outlook
U.S. economic data continues to provide mixed signals. Nonfarm payroll employment increased by only
114,000 jobs in September 2012 but the unemployment rate dropped to 7.8%. Consumers were more
optimistic about business and labor market conditions both currently and over the next six months and sales of
both light vehicles and existing home increased. However, the real GDP growth rate was an anemic 1.3% in
the second quarter of 2012, real disposable personal income decreased for the first time since November 2011,
and industrial production has weakened.
According to the Washington State Economic and Revenue Forecast Council, the Washington State economy
added 12,700 jobs for an annualized growth rate of 1.8% in the last three months. Construction employment
growth remains weak with only 500 net new jobs and government employment continues to decline, shedding
600 jobs. The state’s unemployment rate has been increasing in recent months. After declining from a high of
10.2% in December 2009 to 8.2% in April 2012, the unemployment rate increased to 8.6% in August.
Washington housing construction, as measured by building permits, continues to strengthen. The upturn in the
construction sector has been led by multi-family housing. So far this year (through August) multi-family
permits are averaging 11,500 (SAAR) which is nearly three times higher than the 4,000 for all of 2009, the low
point in housing construction. In contrast, single-family permits have improved much less, to an average rate
of 16,200 so far this year which is a 26% increase from the 13,000 units in 2009. Overall housing units are
averaging 27,700 so far this year which is 74% higher than the 2009 average. While this sounds like a huge
increase, it should be remembered that it is off a very low base. Total housing units this year are still running
48% below the 53,000 units permitted in 2005. While the recent growth in housing construction has been
concentrated in the multi-family sector, we expect the mix to move more to single-family construction.
Local area inflation has moved well ahead of the national average. Seattle headline inflation over the twelve
months ending in August 2012 was 2.8% compared to just 1.7% for the U.S. city average. Core inflation in
Seattle was 3.0% compared to 1.9% for the nation. A major reason for the higher inflation in Seattle is faster
growth in shelter costs which are driven primarily by rents. Seattle shelter costs have risen 3.6% over the last
year compared to 2.1% for the U.S. city average. This explains more than half of the 1.1 percentage point
differential in core inflation.
We continue to expect the state of Washington to outperform the U.S. economy; however, the recovery will
continue to be slow by historical standards and unemployment will decline only gradually.
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TABLE C-1: SUMMARY FORECAST
SUMMARY FORECAST
(Annual Percent Change)
2010
2011
2012
2013
2014
-3.9
10.0
-2.5
0.3
-2.3
6724.5
0.8
0.6
9.6
3.0
1.2
8.9
6767.9
0.6
1.6
8.6
2.2
3.1
16.0
6816.6
0.7
1.9
8.4
2.6
2.6
12.9
6875.9
0.9
2.1
8.1
3.6
2.2
7.0
6944.7
1.0
Age 17 and Under
% of Total
1581.4
23.5
1574.7
23.3
1573.4
23.1
1577.8
22.9
1587.4
22.9
Age 6 - 18
% of Total
1149.6
17.1
1142.4
16.9
1136.9
16.7
1138.9
16.6
1145.1
16.5
Age 18 and Over
% of Total
5143.2
76.5
5193.2
76.7
5243.2
76.9
5298.1
77.1
5357.3
77.1
Age 21 and Over
% of Total
4860.6
72.3
4910.7
72.6
4963.6
72.8
5022.9
73.1
5086.9
73.2
Age 20 - 34
% of Total
1395.3
20.7
1403.2
20.7
1412.1
20.7
1422.8
20.7
1434.2
20.7
Age 18 - 64
% of Total
4315.5
64.2
4341.2
64.1
4348.9
63.8
4360.4
63.4
4379.1
63.1
827.7
12.3
852.0
12.6
894.4
13.1
937.6
13.6
978.2
14.1
Washington State Economic Forecast
Employment
Unemployment Rate
Real Personal Income
Consumer Price Index
Housing Permits
Total Population (in 000's)
% Change
Age 65 and Over
% of Total
Source: Washington State Economic and Revenue Forecast Council, September 2012
www.erfc.wa.gov
Filename: _appendix.doc
Updated: 2/20/2013
XIII-19
Port of Seattle
Appendices
2013 Budget and Business Plan
TABLE C-2: STATE EMPLOYMENT BY INDUSTRY
Washington State 2011 Average Employment Classified by Industry
Industry Description
Agriculture, Forestry, Fishing, and Hunting
Mining
Ultilities
Construction
Manufacturing
Wholesale Trade
Retaill Trade
Transportation & Warehousing
Information
Finance and Insurance
Real Estate, Rental and Leasing
Professional, Scientific, and Technical Services
Management of Companies and Enterprises
Administrative, Support, Waste Management and Remediation Services
Educational Services
Health Care and Social Assistance
Arts, Entertainment, and Recreation
Accommodation and Food Services
Other Services (Except Public Administration)
Government
Total *
Average
Average
Average
Firms
Employment
Annual Wage
7,081
164
233
20,061
6,766
12,937
13,950
3,944
2,468
5,399
6,054
18,376
619
9,407
2,495
14,372
2,401
12,790
64,005
2,098
205,618
89,618
2,143
4,827
126,970
265,654
119,872
307,632
80,686
103,561
87,141
43,145
162,833
33,129
136,000
35,125
327,383
45,151
222,171
132,101
519,241
2,844,384
$25,094
$58,884
$82,054
$52,311
$68,072
$65,811
$30,922
$49,635
$119,967
$73,159
$39,823
$77,337
$102,028
$42,953
$35,569
$45,857
$24,946
$18,066
$24,545
$52,173
$50,264
Source: Washington State Employment Security Department, Employment and Economic Information
Quarterly Census of Employment and Wages,Annual Averages 2011 QCEW Preliminary Data
*: Total and average of statewide rollup data
Filename: _appendix.doc
Updated: 2/20/2013
XIII-20
Port of Seattle
Appendices
2013 Budget and Business Plan
TABLE C-3: TOP 10 PUBLIC COMPANIES IN WASHINGTON
Washington State top 10 Companies
(ranked by 2011 total Sales)
# of
Employees
2011 Operating
Income
2011 Sales
(in thousands)
(in millions)
Company
Industry
Website
Costco Wholesale
Retail
164,000
$2,448,000
Microsoft
Computer Products
90,000
$27,161,000
Amazon.com
Retail
56,200
$862,000
Paccar
Transportation
23,400
$1,479,400
$16,355 www.paccar.com
Starbucks
Retail
149,000
$1,524,600
$11,700 www.starbucks.com
Nordstrom
Retail
56,500
$1,249,000
$10,877 www.nordstrom.com
Weyerhaeuser
Forest products
12,800
$677,000
$6,216 www.weyerhaeuser.com
Expeditors International
Transportation
13,590
$648,330
$6,151 www.expd.com
Alaska Air Group
Transportation
12,806
$448,900
$4,318 www.alaskaair.com
Expedia
Transportation
9,480
$500,460
$3,449 www.expediainc.com
$88,915 www.costco.com
$69,943 www.microsoft.com
$48,077 www.amazon.com
Source: Data extracted from the Seattle Times "Top Northwest Companies' 2011 Financial Data" database
http://seattletimes.com/flatpages/businesstechnology/northwest-companies-2011-tableau-financial-data.html
TABLE C-4: NORTH AMERICAN WEST COAST PORTS’ TOTAL CONTAINER VOLUMES
COMPARISON
North American West Coast Ports' Total Container Volumes
2001 - 2011
Total container volume measured in TEUs (= domestic + international full and empty T EUs)
'01 - '11
avg.
annual '11 vs. '10
2002
2003
2004
2005
2006
2007
2009
2010
2011
% +/-
% +/-
Long Beach
PO RT
4,462,967
4,526,365
4,658,124
5,779,852
6,709,818
7,290,365
7,312,465
6,487,816
5,067,597
6,263,499
6,061,085
3.1%
-3.2%
Los Angeles
5,183,520
6,105,863
7,178,940
7,321,440
7,484,624
8,469,853
8,355,039
7,849,985
6,748,995
7,831,902
7,940,511
4.4%
1.4%
Oakland
1,643,585
1,707,827
1,923,104
2,047,504
2,273,990
2,391,745
2,387,911
2,233,533
2,045,211
2,330,457
2,342,504
3.6%
0.5%
Portland
278,491
255,745
339,571
274,609
160,479
214,484
262,246
245,459
174,203
181,100
197,446
-3.4%
9.0%
16,686
182,242
265,223
343,366
410,469
-
19.5%
-100.0%
4.5%
-5.0%
1.2%
8.1%
2.3%
-0.3%
4.1%
-0.3%
Prince Rupert
San Francisco
2001
-
-
-
-
-
-
34,618
23,682
20,633
32,045
Seattle
1,315,109
1,438,872
1,486,382
1,775,858
2,087,929
1,987,360
1,973,504
1,704,492
1,584,596
2,139,577
2,033,535
T acoma
1,320,274
1,470,834
1,738,068
1,797,560
2,066,447
2,067,186
1,924,934
1,861,352
1,545,855
1,455,467
1,488,795
Vancouver
1,146,577
1,465,292
1,547,371
1,664,906
1,767,379
2,207,748
2,307,291
2,492,107
2,152,462
2,514,309
2,507,032
Total:
-
-
-
2008
15,385,141 16,994,480 18,892,193 20,693,774 22,550,666 24,628,741 24,540,076
2008 Vancouver volumes first year of VFPA
Data source: Port Authorities
Filename: _appendix.doc
Updated: 2/20/2013
XIII-21
-
-
-
-
23,056,986 19,584,141 23,059,677 22,981,377
Port of Seattle
Appendices
2013 Budget and Business Plan
b. Economic Impact
The Port of Seattle retained Martin Associates to evaluate the economic impacts generated by the Seattle
seaport, Seattle-Tacoma International Airport and the Port’s non-maritime and non-aviation tenants, based on
business activity data collected in 2007-2008. The firm has conducted similar studies at more than 250
seaports and most major airports in North America.
For the seaport, the study measures the impacts of five distinct types of waterborne activity:





Marine cargo activity
Fishing activity at marine terminals (and related services)
Waterborne passenger activity (cruise and shore-side operations)
Marina activity (recreational and transient boating)
Non-marine cargo and non-aviation Port of Seattle real estate tenants (restaurant, retail, and industryrelated services.
For the airport, the study measures the impacts of five business sectors:





Airline/airport service sector
Freight transportation sector
Passenger ground transportation sector
Contract construction/consulting services sector
Visitors’ industry sector
The study includes interviews with 929 firms doing business with the Port, plus surveys with 950 aviation
passengers and 600 cruise passengers and ship crew. The analysis of real estate tenants is based on a survey of
291 tenants not included in other seaport operations.
The results provide a snapshot of the economic impact of Port of Seattle in 2007-2008, and impact models for
each business unit operated by the Port of Seattle. The study provides models to assess the economic impacts
of specific Port of Seattle capital development projects.
By air, land and sea, the Port of Seattle connects passengers and cargo to destinations around the globe. From
tourism and international trade to fishing, boating and imported products, the Port affects nearly every person
in the Northwest region—generating nearly 194,000 jobs—and affects many others throughout the world.
Successful trade and travel generate substantial—and dependable—revenue, including $17 billion in business
revenue in 2007. The Port of Seattle’s airport, seaport and real estate activities contribute to the local and
regional economy on multiple levels through the reinvestment and re-spending of Port-generated revenue and
income.
Results demonstrate the Port is a strong driving force for sustainable economic vitality. When combined with
its tenants, the Port of Seattle is responsible for the direct employment of 111,317 individuals, ranking among
the top job-producers in the region including Microsoft (35,510 in Seattle and Washington state), Boeing
(74,517), and the University of Washington (28,188)¹.
Port of Seattle facilities, generate the following economic impacts for the local and regional economy in 2007:

111,317 direct jobs are generated by Port-owned transportation facilities.
Filename: _appendix.doc
Updated: 2/20/2013
XIII-22
Port of Seattle
Appendices
2013 Budget and Business Plan

As the result of local and regional purchases by those individuals, an additional 62,128 induced jobs are
supported in the region.

20,540 indirect jobs were supported by $1.4 billion of local purchases by businesses supplying services at
the Port-owned facilities.

$3.8 billion of direct wages and salaries were received by those 111,317 directly employed by the Port’s
transportation infrastructure. As the result of re-spending this income, an additional $5.1 billion of income
and consumption expenditures were created in the Seattle region, primarily King County.

Businesses providing services at Port-owned marine terminals and Sea-Tac Airport, as well as real estate
tenants, received $17.6 billion of revenue, excluding the value of cargo shipped through the airport and
marine facilities, and the landed value of the seafood caught by the fleet using Fishermen’s Terminal,
Terminal 91 and the Maritime Industrial Center.

$867.0 million of state and local taxes were generated by activity at the Port of Seattle marine terminals,
real estate tenants, and Sea-Tac International Airport. Of the $867.0 million of state and local taxes, the
State of Washington receives about $561.1 million, and the balance, $305.9 million, was received by local
and county governments within the State. In addition, $439.4 million of federal aviation-specific taxes
were generated by activity at Sea-Tac International Airport.
Filename: _appendix.doc
Updated: 2/20/2013
XIII-23
Port of Seattle
Appendices
2013 Budget and Business Plan
APPENDIX D:
BOND AMORTIZATION SCHEDULES
TABLE D-1: BOND AMORTIZATION SCHEDULE FOR 2012
Bond Type
Series
Original Issue
Amount
Issue
Date
Outstanding
Jan. 1, 2012
2012 Principal Payments
Due Date
Amount
Outstanding
Dec. 31, 2012
Interest Payments [1]
Due Date
Amount
GENERAL OBLIGATION BONDS
Limited Tax G.O., Series 2004A
Limited Tax G.O., Series 2004B
Limited Tax G.O., Series 2004C Ref.
Limited Tax G.O., Series 2006 Ref.
Limited Tax G.O., Series 2011 Ref
Limited Tax G.O., Series 2011 Taxable
TOTAL GENERAL OBLIGATION BONDS
$32,510,000
$134,970,000
$131,330,000 [3]
$61,630,000 [4]
$74,000,000 [5]
$30,215,000
01/27/04
01/27/04
01/27/04
01/05/06
02/23/11
02/23/11
32,510,000
85,475,000
55,965,000
61,280,000
70,675,000
30,215,000
336,120,000
First Lien Bonds
2000B Refunding
Series 2000D
Series 2001A
Series 2001B
Series 2001C Refunding
Series 2001D Refunding
Series 2003A
Series 2003B
Series 2004 Refunding
Series 2007A
Series 2007B
Series 2009A
Series 2009B-1
Series 2009B-2
Series 2011A Refunding
Series 2011B Refunding
Total First Lien Bonds
$221,590,000
$28,085,000
$176,105,000
$251,380,000
$12,205,000
$68,580,000
$190,470,000
$164,900,000
$24,710,000
$27,880,000
$200,115,000
$20,705,000
$274,255,000
$22,000,326
$11,380,000
$97,190,000
07/27/00
10/05/01
10/05/01
10/05/01
08/07/02
07/30/03
07/30/03
06/15/04
03/20/07
03/20/07
07/16/09
07/16/09
07/16/09
11/30/11
11/30/11
38,655,000176,105,000
198,000,000
12,205,000
35,980,000
173,085,000
146,900,000
12,740,000
27,880,000
182,160,000
20,705,000
274,255,000
26,307,315
11,380,000
97,190,000
1,433,547,315
02/01/12
03/14/12
Various
03/14/12
Various
Various
Intermediate Lien Bonds
Series 2005A New $
Series 2005A - Ref. 1996A
Series 2005A - Ref. 1997A
Series 2005C - Ref. 1996B
Series 2006A - Ref. 2000A
Series 2010A Ref. 1998A
Series 2010B New Money
Series 2010B - Ref. 2005D
Series 2010C - Ref. 2000B
Series 2012A Refunding
Series 2012B Refunding
Series 2012C Refunding
Total Intermediate Lien Bonds
$252,190,000
$31,475,000
$108,900,000
$40,120,000
$124,625,000
$25,200,000
$157,880,000
$63,435,000
$128,140,000
342,555,000
189,315,000
80,270,000
250,345,000
31,035,000
88,060,000
27,425,000
124,625,000
23,030,000
157,880,000
63,435,000
127,820,000
893,655,000
03/01/12
[18]
[6]
[7]
[8]
[9]
07/20/05
07/20/05
07/20/05
06/06/06
06/08/06
07/15/10
07/15/10
07/15/10
07/15/10
03/14/12
03/14/12
03/14/12
$108,830,000
$127,140,000 [7]
$116,815,000 [9]
$200,715,000 [19]
03/26/97
11/14/02
11/14/02
06/11/08
11/01/12
11/01/12
06/01/12
12/01/12
7,375,000
12,735,000
365,000
3,640,000
24,115,000
32,510,000
78,100,000
43,230,000
60,915,000
67,035,000
30,215,000
312,005,000
05/01,
05/01,
05/01,
06/01,
06/01,
06/01,
11/01
11/01
11/01
12/01
12/01
12/01
1,562,400
4,237,713
2,902,888
3,045,300
3,684,200
805,385
16,237,885
29,840,00002/01, 08/01
04/01
04/01
03/14
05/01, 11/01
36,600,000
01/01, 07/01
146,900,000
01/01, 07/01
9,630,000
06/01, 12/01
27,880,000
04/01, 10/01
176,265,000
04/01, 10/01
20,705,000
05/01, 11/01
274,255,000
05/01, 11/01
28,290,097 [11]
9,700,000
03/01, 09/01
94,490,000
03/01, 09/01
854,555,097
2,054,850
3,986,822
4,806,693
195,046
951,955
6,930,738
7,563,354
612,030
1,383,975
9,099,590
1,087,013
18,960,907
303,616
3,378,295
61,314,882
REVENUE BONDS
Subordinate Lien Bonds
Series 1997
Series 1999A
Series 1999B
Series 2008
Total Subordinate Lien Bonds
TOTAL REVENUE BONDS
Filename: _appendix.doc
Updated: 2/20/2013
[6]
[7]
[8]
[8]
[9]
[7]
[10]
[11]
[12]
[12]
[13]
[14]
[15]
[16]
[17]
[15]
XIII-24
108,830,000
121,840,000
49,215,000
200,715,000
480,600,000
2,807,802,315
06/01/12
10/01/12
09/01/12
09/01/12
03/01/12
09/01/12
06/01/12
02/01/12
08/01/12
11/01/12
09/01/12
Various
8,815,000
176,105,000
198,000,000
12,205,000
35,980,000
136,485,000
3,110,000
5,895,000
1,680,000
2,700,000
580,975,000
5,445,000
6,155,000
4,470,000
6,380,000
275,000
4,550,000
1,555,000
28,830,000
- [2]
65,585,000
49,215,000
114,800,000
724,605,000
244,900,000
31,035,000
81,905,000
22,955,000
124,625,000
16,650,000
157,880,000
63,435,000
127,545,000
342,555,000
184,765,000
78,715,000
1,476,965,000
03/01, 09/01
03/01, 09/01
03/01, 09/01
03/01, 09/01
02/01, 08/01
6/01,12/01
6/01,12/01
6/01,12/01
02/01,08/01
08/01
08/01
11/01
108,830,000
56,255,000
200,715,000
365,800,000
2,697,320,097
Various
[2]
03/01, 09/01
03/01, 09/01
Various
[2]
12,396,200
1,551,750
4,266,150
1,371,250
6,172,675
820,500
7,786,363
3,151,563
6,372,525
6,371,718
2,947,955
687,737
53,896,384
1,142,715
4,880,394
1,690,224
2,107,508
9,820,841
125,032,107
Port of Seattle
Appendices
2013 Budget and Business Plan
SPECIAL REVENUE BONDS
PFC Rev. Bonds Series 1998A
PFC Ref. Bonds Series 2010A
PFC Ref. Bonds Series 2010B
TOTAL SPECIAL REVENUE BONDS
$118,490,000 [20]
$79,770,000 [20]
$66,695,000 [20]
07/16/98
12/01/10
12/01/10
31,020,000
79,770,000
56,605,000
167,395,000
Fuel Facilities Series 2003
$121,140,000 [21]
TOTAL SPECIAL FACILITY REVENUE BONDS
05/01/03
102,885,000
102,885,000
12/01/12
10,245,000
10,245,000
31,020,000
79,770,000
46,360,000
157,150,000
06/01, 12/01
06/01, 12/01
06/01, 12/01
1,706,100
3,988,500
2,830,250
8,524,850
2,710,000
2,710,000
100,175,000
$100,175,000
06/01, 12/01
5,215,625
5,215,625
SPECIAL FACILITY REVENUE BONDS
06/01/12
Notes:
[1] - Interest Payments shown in this schedule are gross amounts before use of any Capitalized Interest.
[2] - Estimated annual total. Interest paid monthly. Principal paid annual or at maturity.
[3] - Series 2004C G. O. Ref. bonds refunded a portion of the Port's 1994B Revenue bonds, and refunded a portion of the 1994 G. O. bonds.
[4] - Series 2006 G. O. Ref. Bonds refunded a portion of the Port's 1999A Special Facility bonds, and refunded a portion of the 2000A G. O. bonds.
[5] - Series 2011 G.O. Ref Bonds refunded the outstanding 2000B G.O. Bonds.
[6] - Series 2010C Ref. 2000 B Intermediate lien refunded a portion of the Port's 2000B First Lien Bonds.
[7] - Series 2012A Intermediate lien bonds fully refunded the Series 2001A First Lien Revenue bonds and partially refunded the Series 1999A Sub Lien bonds and 2003A First Lien bonds.
[8] - Series 2012B Intermediate lien bonds refunded a portion of the Series 2001B First Lien bonds and fully refunded the Series 2001C First Lien bonds. The Series 2001B bonds matured 4/1/2012. The
Series 2001C bonds had previously refunded a portion of the Port's 1990B bonds.
[9] - Series 2012C Intermediate Lien partially refunded the Series 1999B Sub Lien bonds and Series 2001D First Lien bonds. The Series 1999B Sub Lien bonds matured 9/1/2012. The Series 2001D bonds
had previously refunded a portion of the Port's 1992B bonds and matured 11/1/2012.
[10] - Series 2004 First Lien bonds refunded a portion of the Port's First Lien series 1992A, 1994A, 1996B and 1998 revenue bonds.
[11] - Series 2009B-2 First Lien Capital Appreciation Bonds were issued at $22,000,326 par. The outstanding principal balance at 12/31/2012 includes $6,290,125 of accumulated accreted interest.
[12] - Series 2011A and Series 2011B First Lien bonds fully refunded the 1999B and 1999C Special Facility bonds and the 1998 Subordinate Lien series bonds.
[13] - Series 2005A-Ref. 1996A Intermediate Lien bonds refunded a portion of the Port's 1996A First Lien bonds.
[14] - Series 2005A-Ref. 1997 Inremeduate Lien bonds refunded a portion of the Port's 1997A First Lien bonds.
[15] - Series 2005C Intermediate Lien bonds refunded a portion of the Port's 1996B First Lien bonds. It had a delayed delivery date of 6/6/2006.
[16] - Series 2006A Intermediate Lien refunded the outstanding 2000A First Lien series bonds.
[17] - Series 2010A Ref. 1998 A Intermediate Lien refunded the outstanding 1998A First Lien series bonds.
[18] - Series 2010B Ref. 2005D Intermediate Lien refunded the 2005D Subordinate Lien Series Bonds.
[19] - Series 2008 Subordinate Lien bonds refunded the 2003C Subordinate Lien bonds.
[20] - Series 2010 PFCA Ref. bonds refunded a portion of the 1998A PFC series bonds. Series 2010B PFC Ref. bonds fully refunded the outstanding 1998B PFC bonds. Debt services for PFC Ref. bonds
will be paid directly out of receipts from PFCs, not out of operating cash flow.
[21]-Debt service for Fuel Facilities is paid directly from Fuel Hydrant Facility income, not out of general operating cash flow.
The Port has authority to issue up to $250 million in Commercial Paper, as of 9/30/2012 the Port had $42.655 million outstanding.
Filename: _appendix.doc
Updated: 2/20/2013
XIII-25
bondam.xls
Port of Seattle
Appendices
2013 Budget and Business Plan
TABLE D-2: BOND AMORTIZATION SCHEDULE FOR 2013
Bond Type
Series
Original Issue
Amount
Issue
Date
Outstanding
Jan. 1, 2013
2013 Principal Payments
Due Date
Amount
Outstanding
Dec. 31, 2013
Interest Payments [1]
Due Date
Amount
GENERAL OBLIGATION BONDS
Limited Tax G.O., Series 2004A
Limited Tax G.O., Series 2004B
Limited Tax G.O., Series 2004C Ref.
Limited Tax G.O., Series 2006 Ref.
Limited Tax G.O., Series 2011 Ref
Limited Tax G.O., Series 2011 Taxable
TOTAL GENERAL OBLIGATION BONDS
$32,510,000
$134,970,000
$131,330,000 [3]
$61,630,000 [4]
$74,000,000 [5]
$30,215,000
01/27/04
01/27/04
01/27/04
01/05/06
02/23/11
02/23/11
32,510,000
78,100,000
43,230,000
60,915,000
67,035,000
30,215,000
312,005,000
First Lien Bonds
Series 2000B
Series 2003A
Series 2003B
Series 2004 Refunding
Series 2007A
Series 2007B
Series 2009A
Series 2009B-1
Series 2009B-2
Series 2011A Refunding
Series 2011B Refunding
Total First Lien Bonds
$221,590,000
$190,470,000
$164,900,000
$24,710,000
$27,880,000
$200,115,000
$20,705,000
$274,255,000
$22,000,326
$11,380,000
$97,190,000
07/27/00
07/30/03
07/30/03
06/15/04
03/20/07
03/20/07
07/16/09
07/16/09
07/16/09
11/30/11
11/30/11
29,840,000
36,600,000
146,900,000
9,630,000
27,880,000
176,265,000
20,705,000
274,255,000
28,290,097
9,700,000
94,490,000
854,555,097
02/01/13
Intermediate Lien Bonds
Series 2005A New $
Series 2005A - Ref. 1996A
Series 2005A - Ref. 1997A
Series 2005C - Ref. 1996B
Series 2006A - Ref. 2000A
Series 2010A Ref. 1998A
Series 2010B New Money
Series 2010B - Ref. 2005D
Series 2010C - Ref. 2000B
Series 2012A Refunding
Series 2012B Refunding
Series 2012C Refunding
Total Intermediate Lien Bonds
$252,190,000
$31,475,000
$108,900,000
$40,120,000
$124,625,000
$25,200,000
$157,880,000
$63,435,000
$128,140,000
342,555,000
189,315,000
80,270,000
244,900,000
31,035,000
81,905,000
22,955,000
124,625,000
16,650,000
157,880,000
63,435,000
127,545,000
342,555,000
184,765,000
78,715,000
1,476,965,000
03/01/13
5,725,000
03/01/13
09/01/13
[18]
[6]
[7]
[8]
[9]
07/20/05
07/20/05
07/20/05
06/06/06
06/08/06
07/15/10
07/15/10
07/15/10
07/15/10
03/14/12
03/14/12
03/14/12
6,470,000
4,690,000
6,580,000
285,000
16,555,000
18,385,000
58,690,000
$108,830,000
$127,140,000
$200,715,000 [19]
03/26/97
11/14/02
06/11/08
108,830,000
56,255,000
200,715,000
365,800,000
2,697,320,097
09/01/13
11/01/13
11/01/13
06/01/13
12/01/13
7,760,000
13,405,000
385,000
3,785,000
25,335,000
32,510,000
70,340,000
29,825,000
60,530,000
63,250,000
30,215,000
286,670,000
05/01,
05/01,
05/01,
06/01,
06/01,
06/01,
11/01
11/01
11/01
12/01
12/01
12/01
1,562,400
3,850,525
2,234,300
3,030,300
3,538,600
805,385
15,021,510
20,485,000
02/01, 08/01
36,600,000
01/01, 07/01
138,320,000
01/01, 07/01
6,365,000
06/01, 12/01
27,880,000
04/01, 10/01
170,075,000
04/01, 10/01
20,705,000
05/01, 11/01
274,255,000
05/01, 11/01
30,422,320 [11]
7,900,000
03/01, 09/01
93,070,000
03/01, 09/01
826,077,320
1,509,750
1,921,500
7,563,354
442,276
1,383,975
8,804,840
1,087,013
18,960,907
REVENUE BONDS
Subordinate Lien Bonds
Series 1997
Series 1999A
Series 2008
Total Subordinate Lien Bonds
TOTAL REVENUE BONDS
Filename: _appendix.doc
Updated: 2/20/2013
[6]
[7]
[10]
[11]
[12]
[12]
[13]
[14]
[15]
[16]
[17]
[15]
XIII-26
07/01/13
06/01/13
10/01/13
09/01/12
09/01/12
06/01/13
02/01/13
08/01/13
11/01/13
9,355,000
8,580,000
3,265,000
6,190,000
1,800,000
1,420,000
30,610,000
10,710,000 [2]
10,710,000
100,010,000
239,175,000
31,035,000
75,435,000
18,265,000
124,625,000
10,070,000
157,880,000
63,435,000
127,260,000
342,555,000
168,210,000
60,330,000
1,418,275,000
03/01, 09/01
03/01, 09/01
03/01, 09/01
03/01, 09/01
02/01, 08/01
6/01,12/01
6/01,12/01
6/01,12/01
02/01,08/01
02/01,08/01
02/01,08/01
05/01, 11/01
98,120,000
56,255,000
200,715,000
355,090,000
2,599,442,320
Various [2]
03/01, 09/01
Various [2]
390,050
4,659,900
46,723,564
12,116,950
1,551,750
3,950,525
1,147,750
6,172,675
593,200
7,786,363
3,151,563
6,362,700
16,743,200
7,678,200
1,084,464
68,339,339
816,225
3,094,025
1,505,363
5,415,613
120,478,516
Port of Seattle
Appendices
2013 Budget and Business Plan
SPECIAL REVENUE BONDS
PFC Rev. Bonds Series 1998A
PFC Ref. Bonds Series 2010A
PFC Ref. Bonds Series 2010B
TOTAL SPECIAL REVENUE BONDS
$118,490,000 [20]
$79,770,000 [20]
$66,695,000 [20]
07/16/98
12/01/10
12/01/10
31,020,000
79,770,000
46,360,000
157,150,000
Fuel Facilities Series 2003
$121,140,000 [21]
TOTAL SPECIAL FACILITY REVENUE BONDS
05/01/03
100,175,000
100,175,000
12/01/13
10,755,000
10,755,000
31,020,000
79,770,000
35,605,000
146,395,000
06/01, 12/01
06/01, 12/01
06/01, 12/01
1,706,100
3,988,500
2,318,000
8,012,600
06/01, 12/01
5,083,863
5,083,863
SPECIAL FACILITY REVENUE BONDS
06/01/13
2,845,000
2,845,000
97,330,000
$97,330,000
Notes:
[1] - Interest Payments shown in this schedule are gross amounts before use of any Capitalized Interest.
[2] - Estimated annual total. Interest paid monthly. Principal paid annual or at maturity.
[3] - Series 2004C G. O. Ref. bonds refunded a portion of the Port's 1994B Revenue bonds, and refunded a portion of the 1994 G. O. bonds.
[4] - Series 2006 G. O. Ref. Bonds refunded a portion of the Port's 1999A Special Facility bonds, and refunded a portion of the 2000A G. O. bonds.
[5] - Series 2011 G.O. Ref Bonds refunded the outstanding 2000B G.O. Bonds.
[6] - Series 2010C Ref. 2000 B Intermediate lien refunded a portion of the Port's 2000B First Lien Bonds.
[7] - Series 2012A Intermediate lien bonds fully refunded the Series 2001A First Lien Revenue bonds and partially refunded the Series 1999A Sub Lien bonds and 2003A First Lien bonds.
[8] - Series 2012B Intermediate lien bonds refunded a portion of the Series 2001B First Lien bonds and fully refunded the Series 2001C First Lien bonds. The Series 2001B bonds matured 4/1/2012. The
Series 2001C bonds had previously refunded a portion of the Port's 1990B bonds.
[9] - Series 2012C Intermediate Lien partially refunded the Series 1999B Sub Lien bonds and Series 2001D First Lien bonds. The Series 1999B Sub Lien bonds matured 9/1/2012. The Series 2001D bonds
had previously refunded a portion of the Port's 1992B bonds and matured 11/1/2012.
[10] - Series 2004 First Lien bonds refunded a portion of the Port's First Lien series 1992A, 1994A, 1996B and 1998 revenue bonds.
[11] - Series 2009B-2 First Lien Capital Appreciation Bonds were issued at $22,000,326 par. The outstanding principal balance at 12/31/2012 includes $6,290,125 of accumulated accreted interest.
[12] - Series 2011A and Series 2011B First Lien bonds fully refunded the 1999B and 1999C Special Facility bonds and the 1998 Subordinate Lien series bonds.
[13] - Series 2005A-Ref. 1996A Intermediate Lien bonds refunded a portion of the Port's 1996A First Lien bonds.
[14] - Series 2005A-Ref. 1997 Inremeduate Lien bonds refunded a portion of the Port's 1997A First Lien bonds.
[15] - Series 2005C Intermediate Lien bonds refunded a portion of the Port's 1996B First Lien bonds. It had a delayed delivery date of 6/6/2006.
[16] - Series 2006A Intermediate Lien refunded the outstanding 2000A First Lien series bonds.
[17] - Series 2010A Ref. 1998 A Intermediate Lien refunded the outstanding 1998A First Lien series bonds.
[18] - Series 2010B Ref. 2005D Intermediate Lien refunded the 2005D Subordinate Lien Series Bonds.
[19] - Series 2008 Subordinate Lien bonds refunded the 2003C Subordinate Lien bonds.
[20] - Series 2010 PFCA Ref. bonds refunded a portion of the 1998A PFC series bonds. Series 2010B PFC Ref. bonds fully refunded the outstanding 1998B PFC bonds. Debt services for PFC Ref. bonds
will be paid directly out of receipts from PFCs, not out of operating cash flow.
[21]-Debt service for Fuel Facilities is paid directly from Fuel Hydrant Facility income, not out of general operating cash flow.
The Port has authority to issue up to $250 million in Commercial Paper, as of 9/30/2012 the Port had $42.655 million outstanding.
Filename: _appendix.doc
Updated: 2/20/2013
XIII-27
bondam.xls
Port of Seattle
Appendices
2013 Budget and Business Plan
APPENDIX E: AVIATION LANDING FEE REVENUES
The landing fee rate and resulting landing fee revenue are based on the contractual agreement between the
Port's Aviation Division and the airlines. This contractual agreement permits the airlines to land and operate at
Sea-Tac International Airport.
The landing fee rate is established during the budget period for the following calendar year. The rate is subject
to revision during the calendar year and the landing fee dollars are adjusted to the actual airport costs at the
end of the calendar year in accordance with a formula outlined in the Basic Airline Lease. The airlines are
then billed or reimbursed accordingly for any differences.
The landing fee calculation provides that the airlines pay for the operating cost of the airport. The landing fee
formula is as follows:
To the total Airport Operating and Maintenance Costs
Add
Add
+
+
Add
Subtract
+
-
Add
Equals
+
=
Operating and Maintenance Expenses
Capital Costs
(debt services, interim financing costs, etc.)
Allocable Terminal Costs
Other Airfield Revenues
(airfield properties, ID badging, gate parking, fuel flowage)
Change in Security Deposit
Landing Fees required to support the airport
The landing fee rate is determined at the beginning of the year by dividing the landing fee revenues required,
based on the budgeted costs, by the estimated landed weights as provided by the airlines and reviewed for
reasonableness by Airport management.
TABLE E-1: LANDING FEE REVENUE CALCULATION
Seattle-Tacoma International Airport
Landing Fee Revenue Calculation
2013
Budget
Landing Fee Cost $ in '000
Total Operating Costs
Capital Costs
Allocable Terminal Costs
Offset Other Airfield Revenues
Change in Security Deposit
Landing Fee Revenues
Filename: _appendix.doc
Updated: 2/20/2013
$56,974
26,802
1,226
(15,560)
0
$69,442
XIII-28
Port of Seattle
Appendices
2013 Budget and Business Plan
APPENDIX F: OTHER DETAILED EXPENDITURES
A. Promotional Hosting
Promotional hosting consists of expenses incurred by officials and employees of the Port in connection with
hosting others for the purpose of promoting the increased use of Port facilities and services.
TABLE F-1: PROMOTIONAL HOSTING BY DIVISION
($ in 000's)
DIVISION
Aviation
Seaport
Real Estate
Capital Development
Corporate
Total
2011
Actual
Notes
$
$
162,127 $
33,952
9,968
0
570,081
776,128 $
2011
Budget
229,138 $
81,785
21,000
700
656,230
988,853 $
2012
Budget
227,020 $
71,455
20,213
1,700
89,670
410,057 $
2013
Budget
270,421
88,090
20,655
0
184,997
564,163
P R OM O.XLS
B. Memberships
The 2013 Budget for the Port of Seattle includes monies sufficient for memberships amounting to a total of
$1,138,339.
In addition, the Chief Executive Officer may approve additional memberships and dues increases for 2013,
which may arise and which could not be foreseen at this time, provided these increases do not exceed 10% of
the total membership’s budget.
Memberships are for associations for the purpose of participating on a cooperative basis with other port
districts, airports and with operators of terminal and transportation facilities, associations providing specialized
information and services, associations to better qualify certain employees in the performance of specified
duties which are assigned to such employees, and associations which are considered to be of particular and
special value in connection with the carrying out of the Port's promotion and advertising activities.
Membership is an effective way to leverage scarce resources to accomplish objectives that might otherwise be
omitted.
Filename: _appendix.doc
Updated: 2/20/2013
XIII-29
Port of Seattle
Appendices
2013 Budget and Business Plan
APPENDIX G: GLOSSARY OF TERMS USED
Account: Recording of an activity as revenue or expense, such as fees for services, rents, or as salaries,
equipment, supplies, travel, etc.
Accrual: Represents an outstanding obligation for goods and services received or performed but for which
payment has not been made.
Accrual Basis of Accounting: It is the basis of accounting under which revenue transactions are recognized
when earned and expenses are recognized when incurred, regardless of the time the cash is received or
disbursed.
Actual: Earned revenue or incurred expense during the stated fiscal year.
Allocated Expense: These are costs allocated to business groups from service providers. Allocated costs are
general support costs that cannot be directly attributed to a business unit, but instead support the entire Port
and all its Business Groups. Costs can come from within the division (intra-division) or from outside the
division (inter-division.)
Amortization: The gradual reduction in the book value of Fixed or Intangible Assets having a limited life by
allocating the original cost over the life of the asset. (See Depreciation.)
Assessed Valuation: Is an official government valuation set upon real estate and personal property by the
King County Assessor, as a basis for levying property taxes.
Balanced Budget: The Port prepares an annual budget and supports, encourages and commits to a balanced
budget in which revenues exceed expenses. In so doing, the practice is to pay for all current operating
expenses with current revenues and not postpone current year operating expenses to future years or accrue
future year’s revenues to the current year. The Port policy further requires that budgeted operating expenses
do not exceed budgeted revenues, and on-going expenses do not exceed on-going revenues.
Budget: A financial plan, forecast or projection of the Port’s revenues and expenses expected during the
stated budget year.
Budget Calendar: A schedule of key dates that the Port follows in the preparation, review and adoption of its
annual budget.
Budget Document: The Port’s official written approved budget in document format, prepared by the Port’s
Finance and Budget teams.
Budget Message: A general discussion of the proposed budget presented in written format by the Chief
Executive Officer of the Port to the Port Commission and Public.
Capital Budget and Draft Plan of Finance: A detailed five year plan of proposed capital expenditures
arising from the acquisition or improvement of the Port’s fixed assets and the means of financing them through
bond proceeds, grants and operating revenues. This document serves as an operational and planning tool and
it is directly tied to the business plans. The document identifies proposed capital projects at the airport and on
the waterfront and prioritizes those projects.
Capital Capacity: An estimated calculation of the maximum amount available to spend on capital projects,
given assumptions about future revenues and expenses and the ability to cover future interest payments per
bond covenants and Port policies. See further discussion in the Draft Plan of Finance, section XI.
Filename: _appendix.doc
Updated: 2/20/2013
XIII-30
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Appendices
2013 Budget and Business Plan
Capital Expenditures: Expenditures that arise from the acquisition or improvement of the Port’s fixed assets.
Port assets are given a useful life of more than three years when they become active. The expenditures
reflected in the capital budget cover projects anticipated to provide modernized Seaport, Airport and Real
Estate facilities for sustained growth of the Port.
Capitalized Labor or Charges to Capital Projects: Includes the salaries and benefits costs associated with
capital projects. These costs are subtracted out of the operating expense and then input into the capital budget
as part of the cost of the project(s).
Cash Disbursements: Is the disbursement or payment of cash for cost incurred in the operation of the Port’s
business.
Cash Receipts: The collection of cash from services and from Port facilities and equipment leased or
operated.
Continuous Process Improvement Program (CPI): CPI is the port’s official program to establish a
continuous and enduring culture of improvement by utilizing a disciplined and time-tested improvement
methodology called ―LEAN.‖ A culture of CPI will expand and improve the Port’s capabilities, making the
Port a stronger, more competitive organization. The CPI program focuses on four key elements:




Organizational strategies, objectives, and metrics
Employee empowerment and engagement
Efficiency
Innovation
Cost Per Enplanement (CPE): Airline cost per enplanement reflects the overall cost to the airlines for each
passenger enplaned. The CPE measures the total costs borne by the passenger airlines operating at the airport
divided by the number of enplaned passengers (roughly half of the total passengers). CPE is a key indicator
used by the airlines to measure the relative costs of airports.
Customer Facility Charges (CFC): As determined by applicable State legislation, customer facility charges
generate revenue to be expended by the Port for eligible capital projects and the payment of principal and
interest on specific revenue bonds. CFC revenues received from the rental car companies are recorded as nonoperating income in the statements of revenues, expenses, and changes in net assets.
Department/Org: An organizational unit within the Port which is part of a division.
Depreciation: This is a non-cash item that represents the use of long-term assets. Port assets are given a
useful life of more than three years when they become active and each year some of that useful life is used up,
worn or depreciated. (See Amortization.)
Direct Charge: The ability to direct charged for services instead of allocating them, which is charging
against another division’s/department’s subclass to represent where resources were used and dollars spent for
the work that was actually done.
Draft Plan of Finance: A funding plan for the Capital Budget that identifies the types and amounts of funding
sources that are expected to be available in the five year planning period.
Enterprise Fund: There are dozens of funds that are summarized into the Enterprise Fund. The Enterprise
Fund accounts for all activities and operations of the Port. The Enterprise fund is connected to the functional
units in that it is used to account for operations and activities that are financed at least in part by fees or
charges to external users of Airport Facilities, Seaport and Real Estate properties. Therefore, the Port of
Seattle summarizes all of its fund activities in the Enterprise Fund. This includes the Port's major business
Filename: _appendix.doc
Updated: 2/20/2013
XIII-31
Port of Seattle
Appendices
2013 Budget and Business Plan
activities, which are comprised of three operating divisions - Aviation, Seaport, Real Estate; a Capital
Development division and a Corporate Professional and Technical Services division.
Environmental Remediation Liability: The Port’s policy requires accrual of pollution remediation
obligation amounts when (a) one of the following specific obligating events is met and (b) the amount can be
reasonably estimated. Obligating events include: imminent endangerment to the public; permit violation;
named as party responsible for sharing costs; named in a lawsuit to compel participation in pollution
remediation; or commenced or legally obligated to commence pollution remediation. Potential cost recoveries
such as insurance proceeds, if any, are evaluated separately from the Port’s pollution remediation obligation.
Costs incurred for pollution remediation obligation are recorded as environmental expenses unless the
expenditures meet specific criteria that allow them to be capitalized. Capitalization criteria include: preparation
of property in anticipation of a sale; preparation of property for use if the property was acquired with known or
suspected pollution that was expected to be remediated; performance of pollution remediation that restores a
pollution-caused decline in service utility that was recognized as an asset impairment; or acquisition of
property, plant, and equipment that have a future alternative use not associated with pollution remediation
efforts.
Equity: The excess of assets over liabilities.
Estimates: Prediction of revenues and expenditures.
Fiscal Year: The Port’s annual accounting period for recording financial transactions begins January 1 and
ends December 31, which is the same as the calendar year. It is also called budget year.
Forecast: An estimate, projection or prediction of revenues and expenses.
Full Time Equivalent: Full Time Equivalent (FTE) employee, where ―full-time‖ equals 100% of a full-time
schedule. A full-time employee is represented as a ―1.0 FTE‖ where 1.0 = 100% of a full-time schedule.
FTEs represented by less than 1.0, such as 0.8, represent less than a full-time schedule. For example, ―0.8
FTE‖ represents 80% of a full-time schedule.
Fund: The establishment of a fund is to account for money set aside for some specific purpose.
Generally Accepted Accounting Principles (GAAP): Standards and guidelines by which Accounting and
Financial Reporting are governed.
General Obligation (G.O.) Bonds and Interest: The Port can borrow money which is intended to be paid
back through its taxing authority. The tax levy (See Section IX) funds the repayment of the principal and
interest of these bonds. Port financial policies dictate that G.O. bonds be used for projects that have a long lag
between project costs and revenues or are insufficient to support revenue bond financing, the project generates
significant economic benefits for taxpayers, and the project is critical to the Port’s core business.
Goals: Written statements that declare what the port/division/department plan to achieve to fulfill its mission.
Governmental Accounting Standards Board (GASB): It is the accepted standard-setting body for
establishing governmental accounting and financial reporting principles.
Government Finance Officers Association (of USA and Canada) (GFOA): The purpose of the
Government Finance Officers Association is to enhance and promote the professional management of
governments for the public benefit by identifying and developing financial policies and practices and
promoting them through education, training and leadership.
Filename: _appendix.doc
Updated: 2/20/2013
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Port of Seattle
Appendices
2013 Budget and Business Plan
Inter-Division Allocation (Charges): Allocation or Charges from one division to another.
Intra-Division Allocation (Charges): Allocation or Charges from within the division.
Landing Fee: The landing fee rate and resulting landing fee revenues are based on the contractual agreement
between the Port's Aviation Division and the airlines. This contractual agreement permits the airlines to land
and operate at Sea-Tac International Airport. See the discussion of landing fees in Appendix E.
LEAN: Is a management philosophy, a process improvement approach, and set of methods that seek to
identify, eliminate, and reduce non-value added activities or waste within a process. Lean is time tested and is
used by several companies, industries, and agencies around the world. Key principles of LEAN are:




Guiding team members through the steps in process improvement with a trained facilitator
Measuring the current state of a process
Analyzing problem areas within a process
Brainstorming improvement ideas, implementing improvements, and putting in place controls to
sustain improvements
Majority in Interest (MII): Under the terms of the current agreement between the airlines and the airport, the
airlines are entitled to vote their approval for particular capital projects that affect the airline rate base.
Millage: A tax rate on property, expressed in mills per dollar of value of the property.
Mission: A brief statement that describes the purpose of an organization’s existence.
Net Assets: As required by GASB Statement No. 34, Basic Financial Statements – and Management’s
Discussion and Analysis for State and Local Governments, net assets (equity) have been classified on the
statement of net assets into the following categories:

Invested in capital assets – net of related debt: Capital assets, net of accumulated depreciation and
outstanding principal balances of debt attributable to the acquisition, construction, or improvement of
those assets.
 Restricted: Net Assets subject to externally imposed stipulations on their use.
 Unrestricted: All remaining net assets that do not meet the definition of ―invested in capital assets – net of
related debt‖ or ―restricted.‖
When both restricted and unrestricted resources are available for the same purpose, restricted assets are
considered to be used first over unrestricted assets.
Net Operating Income before Depreciation (NOI): Income from operations after all direct expenses and
allocated expenses, but before depreciation, non-operating revenues and expenses have been included.
Non-Airline Revenues: Include concession, parking and other fees not charged directly to the airlines. These
revenues help offset the residual landing fee requirement.
Non-Operating Expenses: Cost or charges that do not arise from the normal operation of the Port’s business.
An example is interest expense.
Non-Operating Revenues: Revenues that do not result from the normal operation of the Port’s business such
as: Ad Valorem Tax Levy, Interest Income, Non-operating Grants, Passenger Facilities Charges, Customer
Facilities Charges and other revenues generated from non-operating sources are classified as non-operating.
Objectives: Are statements of specific outcomes that are related to achieving the desired goals.
Filename: _appendix.doc
Updated: 2/20/2013
XIII-33
Port of Seattle
Appendices
2013 Budget and Business Plan
Operating Income before Allocations & Depreciation: Direct operating revenues minus direct operating
expenses. This does not include any allocated expenses.
Operating & Maintenance Expenses: Cost or charges that arise from the normal operation of Port’s
business. These are cost or services required for a department/division to function. These include Salaries and
Benefits, Equipment expense, Supplies and Stock, Travel and Other Employee expenses and all Direct and
allocated charges, from Corporate and from other Divisions.
Operating Revenues: Fees for services, rents, and charges for the use of Port facilities such as: Dockage,
Wharfage, Berthage and Moorage, Airport Transportation Fees, Airport Landing Fees, Equipment, Property
Rentals and other revenues generated from port’s operations are reported as operating revenue.
Other Post Employment Benefits (OPEB): According to the Governmental Accounting Standard Board
(GASB) statement 45, government agencies are required to record post employment benefit costs other than
pensions as a liability based on actuarial costs.
Passenger Facilities Charges (PFCs): As determined by applicable federal legislation, passenger facility
charges generate revenue to be expended by the Port for eligible capital projects and the payment of principal
and interest on specific revenue bonds. PFC revenues received from the airlines are recorded as non-operating
income in the statements of revenues, expenses, and changes in net assets upon passenger enplanement.
Passenger Facilities Charges (PFCs) Bonds: Bonds backed by Passenger Facility Charges.
Passenger Traffic: Enplanements, deplanements and connecting passenger activity.
Performance Indicators or Measures: Metrics used by Port management to determine whether a program is
achieving or accomplishing its mission efficiently and effectively.
Performance or Operating Budget: A financial plan that incorporates an estimate of proposed revenues and
expenses for a given period. A department's budget includes only those revenues and expenditures for which it
has control.
Plan of Finance: The Five-year Capital Budget is the basis of the Plan of Finance. This document provides a
funding plan of the capital program developed within the financial targets and forecasts described within the
Draft Plan of Finance section. The Draft Plan of Finance is prepared and presented to the Port Commission
concurrently with the Operating Budget. See further discussion in the Draft Plan of Finance section.
Port Commission: It is the governing body of the Port of Seattle, which is comprised of five commissioners
elected by the voters of King County to serve four-year term and to establish Port policy.
Repairs and Maintenance: Expenditures for routine maintenance and repairs to structure and minor
improvements to property, which do not increase the value of the capital assets.
Resolution: A formal expression of opinion or determination adopted by the Port Commission.
Revenue Bonds: A type of borrowing that is repaid through the dedication of revenues intended to be
generated by the investment being funded by the bonds.
Revenue over Expense: The excess or deficit of revenues (operating and non-operating) over expenses
(operating and non-operating). The excess of revenues over expenses increases equity, whereas the deficit,
expenses over revenues, decrease equity.
Filename: _appendix.doc
Updated: 2/20/2013
XIII-34
Port of Seattle
Appendices
2013 Budget and Business Plan
Strategies: The broad, overall priorities adopted by the organization in recognition of its operating
environment and in pursuit of its mission and vision.
Statutory Budget: A plan that depicts the cash flows of the Port. It shows the beginning balance, cash
receipts and cash disbursements and the balance at the end of the year. This budget must be filed with the
King County Council and the King County Assessor as required by law by a specific date. See Section XII.
Tax Levy: The amount of money to be raised by imposing of property taxes. See Section IX.
Twenty-foot Equivalent Unit (TEU): The international standard of measurement for the container volume
that moves through the Port. One forty-foot container is equivalent to two TEUs.
Values: Principles, standards, characteristics or qualities held in high positive regard by an individual or
group. They are often used to guide day-to-day actions.
Variances: The difference between ―actual‖ and ―budget‖ amounts for revenues and for expenses, which
could be either favorable or unfavorable.
Favorable Variance: This is a positive variance and it exists when, in a given period:


Revenues: Actual revenues are higher than budgeted revenues
Expenses: Actual expenses are lower than budgeted expenses
Unfavorable Variance: This is a negative variance and it exists when, in a given period:


Revenues: Actual revenues are lower than budgeted revenues
Expenses: Actual expenses are higher than budgeted expenses
Vision: A word picture or brief statement of what the organization intends to become or how it sees itself at
some point in the future.
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Appendices
2013 Budget and Business Plan
APPENDIX H: ACRONYMS and ABBREVIATIONS
AAPA
AAAE
ACI
AEC
AIR 21
AODB
APM
ARFF
ATC
B&OT
BALA
BHICC
BHM
BHS
BLS
BY
CAFR
CDD
CDP
CEO
CERT
CFC
CFO
CIP
CMMS
CPE
CPI
CPO
CPR
CTDP
CTE
CY
DHS
DNR
DOT
EIS
EPA
ESGR
American Association of Port Authorities
American Association of Airport Executives
Airports Council International
Airport Employment Center
Aviation Investment & Reform Act for the 21st Century
Airport Operations Database
Automated People Mover
Aviation Regional Fire Fighting
Air Traffic Control
Business and Occupation Tax
Basic Airline Lease Agreement
Bell Harbor International Conference Center
Bell Harbor Marina
Baggage Handling System
Bureau of Labor Statistics
Budget Year
Comprehensive Annual Financial Report
Capital Development Division, a Port Division
Comprehensive Development Plan
Chief Executive Officer
Community Emergency Response Team
Customer Facility Charge
Chief Financial Officer
Capital Improvement Program
Computerized Maintenance Management System
Cost per Enplanement
Consumer Price Index
Continuous Process Improvement
Central Procurement Office, a Port department
Cardio Pulmonary Resuscitation
Container Terminal Development Plan
Central Terminal Expansion
Calendar Year
Container Yard
Department of Homeland Security
Department of Natural Resources
Department of Transportation
Environmental Impact Statement
Environmental Protection Agency
Employer Support of the Guard Reserve
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Port of Seattle
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FAA
FAR
FASB
FAST
FEMA
FIS
FMC
FTE
FTPP
FY
GAAP
GASB
GFOA
GIS
G.O.
GT
HCM
HDS
IDC
IFO
ILA
IMC
ICT
KPI
LOI
LRT
MAP
MBE/WBE
MIC
MIS
MOBI
MOU
MPT
MT
NAMF
NAC
NEPA
NEST
NMA
NOI
NTSB
NWMTA
2013 Budget and Business Plan
Federal Aviation Administration
Federal Aviation Regulations
Financial Accounting Standard Board
Freight Action Strategy Corridor
Federal Emergency Management Agency
Federal Inspection Area
Federal Maritime Commission
Full-time Equivalent Employee
Fishermen's Terminal Piers and Properties
Fiscal Year
Generally Accepted Accounting Principles
Governmental Accounting Standards Board
Government Finance Officers Association (of USA and Canada)
Geographical Information System
General Obligation (Bond)
Ground Transportation
Human Capital Management
Harbor Development Strategy
Industrial Development Corporation
Income From Operations
Interlocal Agreement
Intermodal Center
Information and Communications Technology, a Port department
Key Performance Indicators
Letter of Intent
Light Rail Transit
Million Annual Passengers
Minority & Women Owned Business Enterprise
Marine Industrial Center
Management Information System
Marina Operation Boating Inventory System
Memorandum of Understanding
Main Passenger Terminal
Main Terminal
North Area Maintenance Facility
Neighborhood Advisory Committee
National Environmental Policy Act
New Economic Strategy Triangle
National Management Association
Net Operating Income
National Transportation Safety Board
Northwest Marine Terminal Association
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O&D
O&M
OPEB
P&TS
PCC
PCS
PFC
PLA
PM
PMA
PMG
PNWA
POS
PPE
PPM
PREP
PSA
PSCAA
PSRC
RCF
RCW
RE
RFP
RMM
SBM
SDS
SSA
STEP
STIA
STITA
STS
USCG
USDA
TEU
TSA
WSDOT
WPPA
2013 Budget and Business Plan
Origin and Destination
Operating and Maintenance Expense
Other Post-Employment Benefits
Professional and Technical Services
Pacific Coast Congress
Port Construction Services, a Port department
Passenger Facility Charges
Project Labor Agreement
Project Manager
Pacific Maritime Association
Project Management Group
Pacific North West Waterways Association
Port of Seattle
Personal Protective Equipment
Post Panamax
Performance Review, Evaluation & Planning
Professional Service Agreement
Puget Sound Clean Air Agency
Puget Sound Regional Council
Rental Car Facility
Revised Code of Washington
Real Estate, a Port Division
Request For Proposal
Regulated Materials Management
Shilshole Bay Marina
Storm water Drainage System
Stevedoring Services of America
South Terminal Expansion Project
Seattle-Tacoma International Airport
Seattle-Tacoma International Taxi Association
Satellite Transit System
United States Coast Guard
United States Department of Agriculture
Twenty-foot Equivalent Unit
Transportation Security Administration
Washington State Department of Transportation
Washington Public Ports Association
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