9a 2019 Aviation Budget presentation
Item No. 9a_supp . Meeting Date: June 26, 2018 Aviation Division 2019 Business Plan and Budget Preview June 26, 2018 Outline STRATEGY TO BUDGET PROCESS STRATEGIC PRIORITIES ANTICIPATED 2019 BUDGET NEEDS ANTICIPATED 2019 STAFFING NEEDS 2 Strategy To Budget Process Century Agenda Vision 5- 10 Years Strategic Planning SWOT Gap Strategies and Objectives 3 5 Years (Long Range Plans) Implementation 2019 Business Plan 2019 Budget Annual 2019 Performance Plans 3 Industry/Business Context Strong regional economy Airlines profitable, but rising oil price Ground Transportation mode shifts Alaska and Delta account for over 70% of passengers at SEA Paine Field starting commercial service SWOT 4 Challenges FACILITIES Gate shortage Future gate capacity 10 years away CUSTOMER SERVICE Intensive use of facilities Congestion on drives Security checkpoint times increasing SUSTAINABLE AIRPORT MASTER PLAN (SAMP) Port debt level and airport cost to airlines (CPE) will increase SWOT 5 Projecting Growth in Passengers Passengers (000s) 60,000 5% growth in 2018 3% 5% 50,000 3% growth for 2019 40,000 30,000 SAMP Phased Approach 20,000 10,000 - 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 SWOT 6 Century Agenda Drives Aviation Division Priorities AV Priorities Century Agenda - High Performance Organization Employees HPO 2: Eliminate workplace injuries HPO 3: Act as one Port HPO 4: Foster employee development and leverage talent Customer Service HPO 1: Increase customer satisfaction CA 2 Obj 6: Make Sea-Tac "Gateway of Choice" Facilities/Capacity CA 2 Obj 8: Meet the regions air transportation needs Financial CA 2 Obj 8: Meet the regions air transportation needs Safety HPO 2: Eliminate workplace injuries HPO 3: Public safety and Security Security HPO 3: Public safety and Security Community HPO 1: Customer Service and Public Engagement Diversity CA 3: Promote small business HPO 4: Model for Workplace Equity, Diversity and Inclusion Sustainability CA 4: Be the greenest and most energy efficient Port Partners HPO 1: Improve customer service and public engagement STRATEGY 7 Key Priorities for 2019 CUSTOMER SERVICE FACILITIES/CAPACITY FINANCIAL EMPLOYEES STRATEGY 8 Customer Service OBJECTIVES: IMPROVE OVERALL CUSTOMER SATISFACTION SCORE EACH YEAR Improve Airport Service Quality (ASQ) scores Achieve Skytrax 5 Star Rating DEPARTING PASSENGERS Roadway to through security checkpoints < 45 minutes Aircraft taxi time < 20 minutes ARRIVING INTERNATIONAL PASSENGERS Minimum Connect Time < 75 Minutes STRATEGY 9 Customer Service STRATEGIES Realtime info and engagement with customers Lean techniques to improve movement processes Data driven approach to prioritization Targeted facility investments for capacity, efficiency and appearance Technology:more and better information STRATEGY 10 Facilities/Capacity OBJECTIVES Maintain functionality of existing facilities Add needed capacity to facilitate growth STRATEGIES Interim improvements for SSAT - delay full renovation Address life safety issues for main terminal Complete environmental review and permitting of SAMP Integrate sustainable practices Stakeholder partnership to reduce noise impacts STRATEGY 11 Financial OBJECTIVES Grow non-aeronautical revenues to $299 million by 2023 Maintain competitive airline costs (CPE) Achieve debt service coverage >1.25x STRATEGIES Expand duty free offerings Implement new parking products and innovative concessions program Develop alternatives for vehicles access fees Manage within + or 5% of capital budget STRATEGY 12 Employees OBJECTIVE: Increase employee engagement by 3% Baseline and Improve Net Promoter Score (NPS) Annual Employee turnover rate < 10% STRATEGIES: Develop systematic approach to behavior based safety Talent Management Complete Lean training for all AV leaders in 2019 Implement 20% of Shark Tank innovation ideas STRATEGY 13 Other Priorities SUSTAINABILITY: Achieve Sustainable Aviation Fuel (SAF) targets Evaluate options to convert use of natural gas to lower carbon emssions Continue Airfield emissions reduction initiatives Continue terminal and Landside emissions reduction initiatives Ongoing compliance:federal pollution control permits (NPDES), other Continue and expand Social Responsibilities programs STRATEGY 14 Other Priorities (Cont.) AIRFIELD SAFETY Achieve annual airfield composite safety score >30 Plan and build second fire station to continue to achieve 3 minute response time requirement NEW EMPLOYEE CONSOLIDATED SERVICE CENTER ONGOING SOUND INSULATION, PART 150 PROGRAM ADDRESS ISSUES RELATING TO FIREFIGHTING FOAM STRATEGY 15 2019 Budget Aero revenues driven by new assets Non-aero revenue challenges O&M growth reflects resources needed to support strategies Peak capital spending CPE growing as anticipated BUSINESS PLAN & BUDGET 16 Staffing Resource Needs Airport is continuing to grow Intense utilization of existing facilities New and expanded facilities and equipment Staffing study anticipated the need for 45 additional FTEs in 2019 New requests will be reviewed against strategic priorities Intention is to stay within the planned increase for 2019 BUSINESS PLAN & BUDGET 17
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