6b supp
Item No. 6b_supp_1 Date: November 25, 2014 Port of Seattle 2015 Preliminary Budget Second Reading November 25, 2014 Agenda Changes since the First Budget Reading on 11/11/14 2015 Operating Budget 2015 Comprehensive Op & Non-Op Budget 2015 Capital Budget FTEs Summary Sources and Uses of Funds Tax Levy Remaining Schedule 2 Changes Since the First Reading Added $297K to OSR to pay for Airport Jobs' space rental at the Airport. ' Increases Corporate expense budget by $297K ' Increases both aeronautical and non-aeronautical revenue at the Airport Added $500K to Portwide Contingency for expected contracted services for Seaport Alliance. 3 Budget Changes from the First Reading Prelim Bud Proposed Change from 11/11/14 ($ in '000s) on 11/11/14 Budget $ % Note Operating Revenues Aeronautical 242,283 242,352 69 0.0% Cost recovery SLOA III Incentive Adj. -3,576 -3,576 0.0% Non-Aeronautical 188,169 188,465 297 0.2% Space rental revenue from Airport Jobs Aviation 426,876 427,242 366 0.1% Seaport 91,635 91,635 0.0% Real Estate 32,550 32,550 0.0% CDD - - n/a Corporate 340 340 0.0% Other Operating Revenues 124,524 124,524 n/a Total 551,400 551,766 366 0.1% Operating Expenses Aviation 170,014 170,014 0.0% Seaport 22,248 22,248 0.0% Real Estate 40,308 40,308 0.0% CDD 18,194 18,194 0.0% Corporate 81,352 82,149 797 1.0% $297K for Port Jobs and $500K in Contingency Total 332,117 332,914 797 0.2% Net Operating Income 219,283 218,852 -431 -0.2% 4 2015 Preliminary Budget 2013 2014 2014 2015 Chg from '14 Bud Chg from '14 Fcst ($ in '000s) Actual Budget Forecast Budget $ % $ % Operating Revenues Aeronautical 238,633 241,443 235,481 242,352 909 0.4% 6,871 2.9% SLOA III Incentive Adj. 14,304 -3,576 -3,576 -3,576 n/a 0.0% Non-Aeronautical 161,074 166,453 176,615 188,465 22,013 13.2% 11,850 6.7% Aviation 414,011 404,320 408,521 427,242 22,922 5.7% 18,721 4.6% Seaport 99,628 101,553 95,025 91,635 -9,918 -9.8% -3,390 -3.6% Real Estate 30,862 31,376 31,556 32,550 1,174 3.7% 994 3.1% CDD 26 - n/a Corporate 450 155 302 340 185 119.1% 38 12.5% Other Operating Revenues 130,966 133,084 126,883 124,524 -8,560 -6.4% -2,359 -1.9% Total 544,978 537,403 535,403 551,766 14,362 2.7% 16,363 3.1% Operating Expenses Aviation 162,419 164,028 164,839 170,014 5,986 3.6% 5,175 3.1% Seaport 19,091 22,883 19,454 22,248 -635 -2.8% 2,794 14.4% Real Estate 35,200 39,312 38,602 40,308 996 2.5% 1,706 4.4% CDD 14,554 17,000 15,474 18,194 1,194 7.0% 2,720 17.6% Corporate 75,725 80,168 79,654 82,149 1,981 2.5% 2,495 3.1% Total 306,989 323,391 318,023 332,914 9,523 2.9% 14,891 4.7% Net Operating Income 237,989 214,012 217,380 218,852 4,840 2.3% 1,472 0.7% 5 Comprehensive Budget Summary 2013 2014 2015 Budget Change ($ in '000s) Actual Budget Budget $ % Explanations Revenues 1. Aeronautical Revenues 238,633 241,443 242,352 909 0.4% Cost recovery under SLOA III. 2. SLOA III Incentive 14,304 (3,576) (3,576) - 3. Other Operating Revenues 292,041 299,536 312,989 13,453 4.5% Mainly due to higher revenues from the Airport. 4. Tax Levy 72,738 73,000 73,000 - 0.0% Assume no change from 2014. 5. PFCs 64,661 67,879 73,752 5,873 8.7% Higher enplanements in 2015. 6. CFC Non-Op Revenue for Debt Service 20,389 20,568 23,614 3,046 14.8% Due to commerical paper pay down in 2015. 7. Fuel Hydrant 7,417 6,953 7,202 249 3.6% 8. Non-Capital Grants and Donations 3,771 6,688 6,263 (425) -6.4% 9. Capital Contributions 21,381 10,393 40,949 30,556 294.0% $30 million increase in FAA Grant Revenue. 10. Interest Income (1,107) 7,615 7,094 (521) -6.8% Total 734,227 730,500 783,639 53,140 7.3% Expenses 1. O&M Expense 306,989 323,391 332,914 9,523 2.9% New FTEs, pay increase and higher utilities cost. 2. Depreciation 171,374 164,386 162,082 (2,304) -1.4% Some fully depreciated assets at the Airport. 3. Revenue Bond Interest Expense 115,340 128,987 133,468 4,481 3.5% New Aviation bond issuance assumed in 2015. 4. GO Bond Interest Expense 11,479 9,806 14,706 4,900 50.0% New GO bond issuance (Viaduct contribution) assumed in 2015. 5. PFC Bond Interest Expense 6,212 5,953 5,633 (319) -5.4% 6. Non-Op Environmental Expense 4,765 9,300 5,600 (3,700) -39.8% Recognition event for T117 assumed to occur in 2014. 7. Public Expense 6,226 7,121 9,572 2,451 34.4% Clean Truck Scrapping Incentives (largely offset by grants). 8. Other Non-Op Rev/Expense 411 3,738 3,657 (81) -2.2% Total 622,796 652,682 667,632 14,950 2.3% Change In Net Assets 111,431 77,817 116,007 38,190 49.1% 6 Capital Budget Summary Capital Budget Summary by Division $'s in 000's 2015 2016 2017 2018 2019 2015-19 Aviation 328,782 443,389 376,570 269,175 301,462 1,719,378 Seaport 22,570 61,252 145,305 100,553 35,458 365,138 Real Estate 12,736 21,587 14,553 6,866 10,471 66,213 Corp & CDD 9,728 8,676 8,642 8,490 8,192 43,728 Total 373,816 534,903 545,070 385,084 355,583 2,194,456 7 Capital Budget Summary Capital Budget Summary by Category $'s in 000's 2015 2016 2017 2018 2019 2015-19 Commission Authorized/Underway 296,678 398,278 433,257 269,686 173,643 1,571,542 Pending 2014/2015 Authorization 32,805 43,115 12,852 3,809 1,298 93,879 Pending Future Authorization 9,725 33,201 42,123 55,750 52,474 193,273 Small Capital Projects 15,413 14,111 12,133 11,039 11,168 63,864 Total 354,621 488,705 500,365 340,284 238,583 1,922,558 Allowance CIPs and Other* 19,195 46,199 44,705 44,800 117,000 271,899 Total 373,816 534,903 545,070 385,084 355,583 2,194,456 * Allowance CIPs represent undesignated future spending for future new projects and potential budget increases for existing projects in Aviation division. 8 FTEs Summary Aviation Seaport Real Estate Capital Dev Corporate Totals 2014 Approved FTE's 858.5 59.0 166.8 285.1 453.4 1,822.8 Mid Year Approval 4.0 1.0 - 4.0 4.1 13.1 Eliminated (1.0) - - (4.6) (5.6) Transfers 1.0 - - (1.0) - Adjusted 2014 FTE's 862.5 60.0 166.8 289.1 451.9 1,830.3 2015 Budget Eliminated (13.9) (0.3) (0.8) (2.5) (3.0) (20.5) Transfer - - - 3.5 (3.5) - New FTE's 28.4 - 10.0 5.2 43.6 Total 2015 Changes 14.5 (0.3) (0.8) 11.0 (1.3) 23.1 Proposed 2015 FTE's 877.0 59.7 166.0 300.1 450.6 1,853.4 9 Tax Levy Overview Tax Levy Amount ' Levy amount established by the Commission each year as part of the budget process ' The maximum allowable levy for 2015 is estimated to be $95.1 million ' The levy for 2015 is proposed to be $73.0 million ' Projected rate change (from $0.2151 to $0.1896) 2015 Tax Levy Uses ' General Obligation (G.O.) Bonds Debt Service ' Regional Transportation & Freight Mobility Projects ' Seaport and Real Estate Environmental Remediation Liability ' A portion of Real Estate operating expenses and capital improvements ' Highline School NOISE Insulation ' Workforce Development/Portion of Port Jobs ' Addition to the Transportation Infrastructure Fund (TIF) 10 Sources of Funds 11 Uses of Funds K 12 Remaining Schedule Statutory Budget Filed with King County Dec. 4, 2014 Release the Final Budget Document Dec. 12, 2014 13 Port of Seattle 2015 Preliminary Budget Second Reading November 25, 2014
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