PORT OF SEATTLE 
MEMORANDUM 
COMMISSION AGENDA               Item No.       4f 
ACTION ITEM 
Date of Meeting    October 10, 2016 
DATE:    September 21, 2016 
TO:      Ted Fick, Chief Executive Officer 
FROM:   Elizabeth Morrison, Director, Corporate Finance 
SUBJECT:  New Solicitation for Financial Advisory Services 

ACTION REQUESTED 
Request Commission authorization for the Chief Executive Officer to execute a contract for
financial advisory services for seven years (base contract of five years with two one-year
options) for an estimated cost of $3,500,000. 
SYNOPSIS 
The Port of Seattle uses an independent financial advisor (FA) to assist with the issuance and
management of its debt. The FA provides assistance with the day-to-day management of debt
issuance and provides information and advice on general financial management matters. This
request will authorize the CEO to enter into a new contact for financial advisory services not to
exceed $3,500,000. The contract will be procured through a competitive selection process and 
will replace the current contract that expires on April 8, 2017. 
BACKGROUND 
Governmental entities, including the Port, who issue debt in the municipal market, employ the
services of an independent FA. These firms advise the Port on the overall debt and financial
management activity. FAs provide current information on market trends, rates, debt structures
and investor concerns, and provide analytical support and insights into the municipal market.
FAs maintain a fiduciary responsibility to the Port, and the use of an FA is deemed a best
practice by the Government Finance Officers Association.
The Port's debt management needs cover both new bond issuances, needed to fund capital 
projects, as well as management of the Port's existing debt, currently approximately $3.2 billion.
For example, the Port's FA advises the Port on overall debt structure and financial management,
incorporating the perspective of investors and rating agencies; advises on opportunities to refund
existing debt for debt service savings; participates in all aspects of a bond issuance; advises on
and participates in extensions, replacements, and amendments of letters of credit supporting the
Port's variable rate debt; assists with the coordination of the Port's team of investment banks and
the Port's bond and disclosure counsel; evaluates proposals and new financial products; and
provides an independent perspective at Commission briefings on financial matters. The Port's
FA shares its knowledge of other local government issuers and of other airports and seaports

Template revised May 30, 2013.

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
September 21, 2016 
Page 2 of 4 
nationwide. The FA can provide analysis of the financial impact of pending or new legislation.
Finally, the FA provides recommendations for improving the long-term financial position of the
Port. 
The current financial advisory contract is a five-year contract with two one-year extensions (both
exercised) that expires on April 8, 2017. Due to the expected timing of bond issues, it is
important to have the new financial advisory contract signed and the FA fully functioning prior
to this expiration date.
Staff is requesting a contract term of five years with two one-year extensions. Financial and debt
management are on-going functions that benefit from a consistent approach and a long-term
view.  Some Port financing initiatives have been multiyear efforts, such as the development of
the Port's Intermediate Lien, which was tied to the lengthy negotiation of a new airline
agreement, and the rental car facility financing, which took several years to complete due to
challenging business and economic conditions. A five -year contract should also encourage
wider participation among potential respondents, since considerable effort will be required of the
successful firm to become familiar with the Port's businesses, financial structure,  and
management of the Port's debt  including familiarity with voluminous legal documents. A
longer-term contract will encourage firms to submit a response and invest their time. 
As part of the competitive selection process, the Port will ask firms to provide detailed
information on their intended use of small businesses. This will encourage firms to identify
specific portions of the engagement that can be subcontracted to small firms. Many components
of financial advisory work are on an as-needed basis. Some years there could be more demand
than other years for services that can utilize small businesses, so a specific target may not be
feasible. The use of small businesses will be included in the selection process. 
ALTERNATIVES AND IMPLICATIONS 
Alternative 1  Do not use a financial advisor 
Pros: 
(1) Eliminates the explicit costs of up to $3,500,000 
Cons: 
(1) Increases Port risk by not having an independent fiduciary to assist with complex
transactions and market access 
(2) Increases Port risk of paying higher cost of issuance without the monitoring and
advice of the FA 
(3) Port would not be following "best practices" for municipal issuers 
This is not the recommended alternative. 


Revised March 28, 2016 

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
September 21, 2016 
Page 3 of 4 

Alternative 2  Procure a new contract for each bond issue 
Pros: 
(1) Port would have the benefit of an on-going competitive process that would provide
the most up-to-date information regarding FA services and fees 
Cons: 
(2) As a frequent issuer, the Port would need to procure an FA at least annually adding to
the time associated with issuing bonds 
(3) The Port would lose the continuity and efficiencies that come with a longer-term
relationship 
(4) The complexity of the Port and its debt management could discourage some firms
from responding to a one-time transaction 
This is not the recommended alternative. 
Alternative 3  Procure a new long-term FA contract. 
Pros: 
(1) This approach is consistent with debt management "best practices" 
(2) The Port benefits from an independent fiduciary's advice on Port debt and financial
management 
(3) The Port benefits from the consistency and understanding of the Port and its debt
management that a longer-term engagement provides and can terminate the contract
at any time if appropriate 
(4) The longer-term contract provides a greater incentive for firms to respond and to take
a thoughtful approach to utilizing small business 
Cons: 
(1) The Port will pay up to $3,500,000 for FA services 
This is the recommended alternative. 
FINANCIAL IMPLICATIONS 
Budget Status and Source of Funds 
The costs associated with this contract are included in the Port's non-operating budget and
forecasts. The source of funds will vary depending on the specific transactions; bond proceeds
will be used to pay the FA costs specifically associated with a bond transaction. 
Financial Analysis and Summary 
The cost of the contract would be up to $3,500,000 for a period not to exceed seven years.

Revised March 28, 2016 

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
September 21, 2016 
Page 4 of 4 

The FA would be compensated in two ways. For new bond issues, the FA would receive a fee
per bonds issued. In addition, the FA would be paid an annual fee for all work not related to a
specific new bond issue (e.g. letters of credit, debt structure advise, investor and rating agency
updates, etc.). Because the timing and amount of debt depends on the capital needs of the
operating divisions or on the market driven refunding opportunities, the dollar amount is set a
level that is estimated to accommodate five to seven years of multiple transactions, taking into
account the Port's prior experience.
ATTACHMENTS TO THIS REQUEST 
None 
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS 
None 












Revised March 28, 2016