Commission Meeting Portal

Special Meeting on Oct 20, 2009 1:00PM

Minutes for the Port Of Seattle Commission meeting, held on Oct 20, 2009 1:00PM

        Commissioners                                                                      Tay Yoshitani 
                                                                                                                 Chief Executive Officer 
                        Bill Bryant 
                            Chair and President 
                        John Creighton                                   P.O. Box 1209 
                        Patricia Davis                               Seattle, Washington 98111 
                        Lloyd Hara                                    www. portseattle.org 
                        Gael Tarleton                                     206.787.3000 

                   An audio of the meeting proceedings and meeting materials are available on the Port of
                                                            Seattle web site - 
                        http://www.portseattle.org/about/organization/commission/commission.shtml 

                   (The approximate point in the audio recording for the specific item is identified by
                  minutes and seconds; example: 01:30.) 
                                APPROVED MINUTES 
                      COMMISSION SPECIAL MEETING OCTOBER 20, 2009 
                  The Port of Seattle Commission met in a special meeting at 1:00 p.m., Tuesday, October
                 20, 2009 in the Commission Chambers at Pier 69, 2711 Alaskan Way, Seattle, WA.
                  Commissioners Bryant, Creighton, Davis, Hara and Tarleton were present. 
                      1.       CALL TO ORDER 
                   The regular meeting was called to order at 1:04 p.m. by Bill Bryant, Chair and President. 
                      2.       EXECUTIVE SESSION pursuant to RCW 42.30.110 
                 None. 
                 PLEDGE OF ALLEGIANCE 
                      3.       APPROVAL OF MINUTES 
                 None. 
                       4.      SPECIAL ORDER OF BUSINESS 
                 None. 
                       5.      UNANIMOUS CONSENT CALENDAR 
                 None. 

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            PORT COMMISSION MINUTES OF THE SPECIAL MEETING 
              TUESDAY, OCTOBER 20, 2009                                      P. 2 
                       6.   DIVISION, CORPORATE AND COMMISSION ACTION ITEMS 
                 None. 
                       7.   STAFF BRIEFINGS 
                      a.  (00:01:25) Briefing on Emergency Management Planning  Green River Flood
                    Planning 
                  Presentation documents: Commission agenda memorandum dated October 7, 2009 from
                  Ralph Graves, Managing Director, Capital Development Division; Kathleen Gleaves,
                 Emergency Preparedness Manager, Seaport; and Ron Harmon, Emergency Preparedness
                 Manager, Aviation. A computer slide presentation titled, "Green/Duwamish River
                  Potential Flood Event  Impacts to the Port of Seattle and Neighboring Businesses" was
                   also provided. 
                   Presenter: Mr. Graves 
                 Mr. Graves provided background information on conditions of the Howard Hanson Dam
                   and potential effects of flooding along the Green River which could occur this winter. He
                   noted that the Dam was built in 1962 for flood control in the Kent Valley. 
                  It was pointed out that the U.S. Army Corps of Engineers (Corps) discovered significant
                  damage and leakage within the earthen portion of the dam following last winter"s record
                    rainfall and that in order to ensure stability of a planned temporary fix, the Corps will not
                   allow the dam"s reservoir to hold as much water as it has in the past. At the time of this
                   briefing, the Corps estimates the probability of flooding to be as high as one in three.
                   Mr. Graves reviewed potential impacts to the Port if should flooding occur and he also
                   addressed possible needs for evacuation and sheltering. He also spoke about planning
                   and preparation being done by Port staff for a possible flooding event, stating that
                   working groups are being established to address any related issues. 
                   Mr. Graves commented briefly the possibility of a loss of power at the Airport which
                   could result in case of a flood noting that it had led staff to make a related emergency
                   declaration and stated that this was actually the substance of the next item on the
                 Commission agenda. 
                     b.  (00:18:00) Briefing on Emergency Declaration to Provide Back -up Electric
                    Power at Seattle-Tacoma International Airport (Airport) 
                  Presentation documents: Memorandum dated October 15, 2009 from Ralph Graves,
                 Managing Director, Capital Development Division and Ray Rawe, Director, Engineering
                  Services and copy of Declaration of Emergency dated October 16, 2009 and signed by
                 CEO Tay Yoshitani. 

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            PORT COMMISSION MINUTES OF THE SPECIAL MEETING 
              TUESDAY, OCTOBER 20, 2009                                      P. 3 
                   Presenter: Mr. Graves 
                  It was noted that once the information was received regarding the damage to the Howard
                   Hanson Dam and potential resulting flooding, staff has been evaluating options for
                  providing 100% back-up power for the Airport. As the Airport receives electric power
                  from Puget Sound Energy substations in the Green River Valley, transmission of power
                    could be interrupted for long periods of time if there is flooding. This analysis led to a
                  decision by the CEO to sign an emergency declaration on October 16 to allow staff to
                   lease generators for back-up power generation at the Airport. 
                   Mr. Graves noted that the potential flooding situation being discussed was very different
                   than a situation such as 9-11 when all airports were closed. He stated that if there is a
                    flooding event, it will be critical for the Airport to remain open as it will be one of the
                  main routes of assistance, both in terms of people and supplies which would come into
                   the region.
                  Mr. Graves responded to Commissioner Tarleton"s questions about working groups in
                   various agencies that would communicate information to the public, stating that various
                  agencies (the Port, the County, the Corps) would each be responsible for communicating
                    specific levels of information. 
                   Mark Reis, Managing Director, Aviation Division, reiterated that the Airlines are in
                   strong support of this approach to the problem, and stated that the best approach is to
                   have back-up support available in advance on site in case it is needed.
                      8.   NEW BUSINESS 
                 None. 
                       9.   POLICY ROUNDTABLE  BUDGET WORKSHOP 
                      a.  (00:43:30) Discussion of Seaport and Real Estate Funding Plans 
                  Presentation documents: Commission agenda memorandum dated October 7, 2009 from
                  Dan Thomas, Chief Financial Officer and Elizabeth Morrison, Senior Manager,
                  Corporate Finance. Computer slide presentations on funding plans for Seaport and Real
                   Estate Divisions were also provided as well as presentations regarding the 2010 Capital
                   Budget for both the Seaport and Real Estate Divisions. 
                   Presenters: Mr. Thomas; Ms. Morrison; Boni Buringrud, Manager, Seaport Finance and
                  Budget; Joe McWilliams, Managing Director, Real Estate Division 
                  Mr. Thomas noted that today"s presentation incorporated information that the
                   Commission had requested earlier in terms of looking at how the tax levy is used. 


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            PORT COMMISSION MINUTES OF THE SPECIAL MEETING 
              TUESDAY, OCTOBER 20, 2009                                      P. 4 
                  Ms. Morrison provided a brief review of the preliminary tax levy briefing which was
                 provided to the Commission on September 17. She stated that other topics to be
                  addressed would include: 
                     Preliminary levy scenario 
                    Updated scenario 
                     Preliminary Assessor Information 
                    Draft Levy Policy 
                     Seaport Self-Sufficiency 
                  Ms. Morrison noted that the levy scenario being presented includes the known uses of the
                   levy, but does not include any estimate of the Port"s contribution to a bored tunnel on
                   SR99, nor does it include some of the future environmental expenses that are not
                  completely known at this time. It was assumed that the levy would continue at the same
                   amount it has been for the last two years.
                  The changes mentioned since the September 17 presentation included the areas of
                   environmental expenses a well as updated information on the use of the tax levy for the
                   Real Estate Division for both operating and capital needs. 
                   Commissioner Bryant stressed that at this time, the discussion is about having a budget
                    that does not have the Seaport Division relying on the tax levy, and that if there is
                   discussion about reducing the tax levy, it is not discussion about cutting back on capital
                   programs for the Seaport. 
                   Discussion followed about the importance of preserving options for taxing capacity, not
                   necessarily exercising those options. It was stated that much of the public believes that
                  the Port taxes to the maximum amount allowed, and that people need to understand that is
                    not the case. 
                  The financial impact of the tax levy on home owners was reviewed for different rates and
                  it was noted that the amount of Port tax for homeowners depends on the dollar amount of
                    the Port"s levy. 
                  Ms. Morrison stated that based on Century Agenda guidelines, staff was drafting a levy
                   policy, currently a work in progress, which put levy uses into the two broad categories: of
                 Public Good and Business Support. She noted that discussions would continue into next
                    year before finalizing the policy. 
                   Ms. Morrison noted that the current analysis assumes that the Seaport Division will be
                    self sustaining with no additional tax levy needed for future projects in the next five years 
                   and that the Real Estate Division will receive interim levy support as the Port develops a
                   long-term financial strategy. 
                    It was noted that staff will return for first reading of the budget and will take direction
                  from the Commission and incorporate it into future documents and presentations with

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            PORT COMMISSION MINUTES OF THE SPECIAL MEETING 
              TUESDAY, OCTOBER 20, 2009                                      P. 5 
                   respect to the levy assumptions. Staff will return with a Resolution that will specifically
                   increase the maximum levy as discussed earlier, and clarified that this will be a separate
                   resolution from the budget resolution that sets the levy amount.
                  Boni Buringrud addressed the 2010 Seaport Division Capital Budget and the impacts of
                   self-sufficient funding. She noted that under the parameters for the tax levy use
                   presented earlier, $150 million of 2010-2014 projects would need to be deferred.
                   Projects to be deferred were listed on the computer slide presentation and discussed by
                 the Commission and staff. Commissioner Bryant commented on the importance of the
                   fact that not only is Seaport moving toward self-sufficiency, but is doing so while still
                   assuming a lot of the environmental costs. 
                  Ms. Buringrud and Mr. McWilliams then presented information on the 2010 Real Estate
                  Division Capital Budget and the impacts of a $67 million flat levy amount for 2010-2014.
                  Upcoming Real Estate projects were reviewed and discussed by Commissioners and staff
                   and are listed individually in the slide presentation which was given.
                  Following discussion, CEO Yoshitani commented that staff would like to have some
                   guidance as to where they would like to see the levy amount end up in the budget for next
                   year.
                   Commissioner Davis stated that she would like to see the levy proceed with a flat
                   amount, and that if there is any money left over from that, that it be banked or kept as a
                   reserve for the future needs related to transportation and environmental issues.
                  Commissioner Tarleton stated that she would like to understand the consequences for the
                   subsequent years 2-5 on the Capital Plan of Finance should a $67 million dollar tax levy
                  be adopted. Mr. Thomas clarified that the same number of projects would be funded in
                    that scenario. 
                  Commissioner Bryant shared that he thought it would be prudent to have reserves for the
                   areas of transportation and environmental obligations. He said it would be good to look
                   at the staffing levels of both Seaport and Real Estate.
                   Commission Creighton noted that he was also inclined to stay with the flat dollar amount 
                   and then clarified that he was referring to an amount of $67 million. 
                  Commissioner Hara commented on the need to look at potential methods of saving to
                    operating expenses and also greater utilization of the Port"s assets.
                  In summary of discussion points, Commissioner Bryant mentioned the following: 
                      There was apparent support for 1% on the levy ceiling. He re-emphasized that
                          that amount would not be collected nor spent. 

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            PORT COMMISSION MINUTES OF THE SPECIAL MEETING 
              TUESDAY, OCTOBER 20, 2009                                      P. 6 
                       Providing a scenario holding the level at $67 million and look for another $8
                           million in cuts to help absorb some of the costs that are currently in the capital
                         budget 
                      Have a level of $75 million and bank or reserve $8 million 
                       Hold the level at $67 million for 2010 and raise it to $79 million beginning in
                       2011 
                  Public comment regarding Item 9a was received from the following individuals: 
                     Paul Marvy, Citizens for Port Reform. Mr. Marvy stated that voters of King
                         County have supported tax increases when they relate to community values, such
                            as support for libraries, parks and jobs. He also stated his belief that the Port
                          would likely run into public skepticism if taxes were raised according to one of
                           the scenarios presented today. 
                      Fred Felleman, Friends of the Earth. Mr. Felleman stated his appreciation of the
                           decision to set the Seaport Division free from the tax levy. He stated his concerns
                          about the changes made since September which reflect an increase to the
                         environmental budget.
                      Mr. Felleman also commented on an issue not on the agenda, which was the
                          cruise ship discharge policy recently released by the International Maritime
                        Organization (IMO). A copy of the circular released by the IMO was provided by
                          Mr. Felleman, is by reference, made a part of these minutes; is marked Exhibit
                             "A" and is on file in Port offices. 
            10. ADJOURNMENT 
                   There being no further business, the meeting was adjourned at 4:01 p.m. 
                   (A digital recording of the meeting is available on the Port"s website) 

                   Bill Bryant 
                   President 






                       Oct 20 SM Min