9c. Q2 Financial Performance Presentation
Item No. 9c_supp . Meeting Date: August 13, 2019 Port of Seattle Q2 2019 Financial Performance Report Portwide Financial Highlights Q2 YTD Actual: o Operating Revenues $7.9M favorable to budget and $37.7M over 2018. o The Non-Aviation Revenues $5.4M favorable to budget and $3.6M higher than 2018. o Operating Expenses $16.0M below budget and $25.2M over 2018. o Net Operating Income before Depreciation $23.9M favorable to budget and $12.5M over 2018. o Total capital spending was $287.5M for Q2 2019. Year-End Forecast: o Operating Revenues $14.7M higher than budget. o Operating Expenses $6.8M lower than budget. o NOI before depreciation $21.6M higher than budget. Strong Q2 financial results 2 Aviation Division Financial Highlights Business Highlights Figure in $000s Forecast Budget Variance Passenger growth 3.4% YTD Revenues NSAT Phase I complete (July) Aeronautical 364,646 365,604 (958) Meeting Safety goals: Non-aeronautical 270,014 259,537 10,477 Airfield composite safety score 20.5, Total 634,660 625,141 9,519 above goal of 18 O&M expense 363,640 366,105 2,465 Individuals not going home = 19 vs. NOI 271,020 259,036 11,984 2019 goal 52 Key Measures Meeting customer service goals: Non-Aero NOI 149,181 136,534 12,647 ASQ: Exceeding 5-year average for 2 of 6 key measures (goal is 2/6) CPE ($) 13.09 13.39 0.30 Completed sound insulation on 9 Capital Spending 659,813 767,732 107,919 single family homes On track to meet financial targets and business goals 3 Maritime Division Financial Highlights Business Highlights Figure in $000s Forecast Budget Variance Revenues YTD Q2 NOI $516K greater than 2018. Fishing, Commercial, & Revenue Growth 4%, Expense Growth 3% Recreational Marinas 22,642 22,742 (100) Completed RFQ process for new cruise terminal Cruise 22,406 22,406 0 with 3 finalists. RFP issued to each in Q3. Maritime Portfolio Mgmt. 10,328 10,328 0 Successful first arrival of the Norwegian Joy and Grain / Other 4,254 4,254 0 Royal Caribbean's Ovation of the Seas. Total 59,629 59,729 (100) Last season of the 680' Ocean Phoenix at T-91. She will travel to Texas to be recycled in July. O&M Expense Completed solar panel installation at Pier 69. Maritime & EDD 17,802 19,600 (1,798) Project came in under budget with 66% of costs Maintenance 11,980 11,980 0 recovered by the grant. Central Services and Other 18,699 19,242 (543) Installed rain garden adjacent to the bike path at Total 48,481 50,822 (2,341) T-86 and new drainage system in Cruise NOI 11,149 8,908 2,241 passenger area at Pier 91. Capital Spending 15,105 17,638 (2,533) Exceeding budget and completing environmental projects 4 Economic Development Division Financial Highlights Business Highlights Figure in $000s Forecast Budget Variance Authorization to start modernization at BHICC. Revenues 19,725 19,725 0 Leased 98K of yard space at T-91. O&M Expense Strong response for T-106 RFP issued Q2. EDD & Maritime 14,985 15,593 (608) Maintenance 3,571 4,071 (500) Published first Diversity In Contracting Annual Report. Diversity in Contracting 199 199 0 2018 WMBE results (11.8%) and 2019 goals (12.4% excl. construction) Workforce Development 1,600 2,010 (410) Port had 16.1% WMBE utilization after Q1. Tourism 1,521 1,521 0 Ironworker's union program second cohort graduated 14, EDD Grants 900 1,160 (260) Central Services and Other 6,397 6,561 (164) and 13 are now enrolled apprentices. Total 29,172 31,114 (1,942) RFP for Career Advancement Center at airport released. NOI (29,172) (31,114) 1,942 EDD Partnership Program YTD Approximately $796K Capital Spending 4,980 5,713 (733) awarded to 25 cities in 2019. Maximizing Port's real estate potential and driving jobs & economic activity 5 Central Services Financial Highlights Business Highlights Adopted the Duwamish Valley Community Equity Program and Figure in $000s Forecast Budget Variance held the Duwamish Alive community restoration event at T117. Revenues 498 185 313 Hosted Career Awareness events in Mt. Rainier High School, Foster High School, and Highline High School. O&M Expense Completed Phase 2 of Port Website Redesign project. Core Central Support Services 81,157 82,710 1,552 Provided Rapid Response trainings to airport/airline employees Police 29,578 30,778 1,200 by the Port Police department. Capital Development 16,227 18,628 2,401 A new Project Delivery system for smaller and major construction projects is being developed to replace two legacy Environment & Sustainability 12,101 13,224 1,123 project management solutions and streamline key processes. Total 139,064 145,339 6,276 Released the Comprehensive Annual Financial Report (CAFR) and received a clean independent audit opinion on financial Capital Spending 14,844 23,368 8,524 statements. Strong performance results for Central Services 6 Q & A olgiFud T=nd[= 7 V) Portwide Net Operating Income Performance Airport Non-Aero Revenues Aeronautical Revenues Non-Airport Revenues Total Operating Expenses NOI In 000s Operating Revenues are $7.9M higher than budget 900 due to higher revenues in: o ADR 800 o Ground Transportation 700 o Rental Cars o Clubs and Lounges 600 o Conference & Event Centers 500 o NWSA Distributable 400 Revenue 300 Total Operating expenses are $16.0M below budget 200 due to: o Staffing vacancies 100 o Project delays - 2015 2016 2017 2018 2019 Fcst 2019 Bud Steady revenue growth since 2015 8 Non-Airport Net Operating Income Performance Other Operating Revenues NWSA Distributable Revenues Total Operating Expenses NOI In 000s 160 Non-Airport Operating 140 Revenue exceeded budget by $5.4M due to: 120 o Higher revenue from Conference & Event 100 Centers. 80 o Higher NWSA Distributable Revenues 60 Expenses are $4.6M lower than budget due to: 40 o Staffing vacancies 20 o Project delays o Other spending delays. - 2015 2016 2017 2018 2019 Fcst 2019 Bud NOI forecast to exceed budget 9 Aviation Division Q2 2019 Financial Performance Report Aviation Business Events PASSENGERS: o Passengers up 3.4% through June o International passengers up 3.0% o Tracking below adjusted 2019 growth assumption of 4% (budget assumed 3%) NEW INTERNATIONAL SERVICES STARTED YTD: o Cathay to Hong Kong o Japan Airlines to Tokyo-Narita o Delta to Osaka NEW FACILITIES: o Opened Alaska Lounge on NSAT, Phase I complete (July) Growth continues 11 Business Highlights: 2019 Goals SAFETY: Airfield composite safety score of 20.5 exceeds annual target of 18 Major ground incidents YTD = 32 vs. annual goal 67 Individual not going home: Q2 YTD 19 vs. 2019 goal < 52 (on track) Developed policy for standardized personal protective equipment required in Bagwell SECURITY: Phase II Employee Screening authorized in May Implemented new Credentialing Office processes to reduce wait times to receive badge Airfield composite safety score exceeding goal 12 Business Highlights: 2019 Goals EMPLOYEE ENGAGEMENT: Goal is to increase employee engagement in the Aviation Division as evidenced by a 3% increase over the 2018 survey results by Q4 2019. Create department specific survey action plans by end of Q2: in progress INNOVATIONS & EFFICIENCES: Preparation for second Shark Tank innovations forum (held July 30) Implement two efficiencies or innovations in each department in process ASSET MANAGEMENT: Asset condition assessment inventory in process On track 13 Business Highlights: 2019 Goals SOCIAL RESPONSIBILITY: Airport Concessions Disadvantaged Business Enterprise (ACDBE) share of sales = 22.5% vs. goal of 22% Disadvantaged Business Enterprise (DBE) share of FAA grant contract spending of 13.9% vs. goal of 8% Women and Minority Business Enterprise share of spending on personal services contracts = 14.2% vs. goal of 12% CUSTOMER SERVICE: Through Q2 exceeding five-year average for 2 of 6 key measures (goal is 2) Q2 increase for washroom cleanliness and internet access/wi-fi 76% of AV Division staff completed WE ARE customer service training On track 14 Business Highlights: 2019 Goals ENVIRONMENT AND SUSTAINABILITY: Completed A&E/Construction contract for condo sound insulation Reviewing proposals for purchase of renewable natural gas Completed sound insulation for 9 single family homes FINANCIAL PERFORMANCE: Forecasting to achieve both 2019 goals: o Non-aeronautical NOI of $149.2M vs. budget of $136.6M o Airline costs (CPE) of $13.09 vs. budget of $13.39 Commission authorized Concessions Lease Group 5 in June On Track 15 Business Highlights: 2019 Goals CAPITAL PROJECT, PLANNING & SAMP: SAMP: o Submitted revised NEPA scope of work and forecast report o Commission authorized $10 million for project planning and preliminary design for SAMP projects (July) Briefed Commission on main terminal optimization plan (MTOP) in July Completed phase 1 of North Satellite and opening of Alaska Lounge (July) Progress on major project milestones 16 Airport Activity Year-to-date Q2: Passengers +3.4% Landed weight +3.0% Cargo metric tons +1.2% Total passenger growth anticipated to be 4% for year 17 Airline Cost Management (CPE) 2019 Budget: Adjusted for SLOA IV 20% revenue sharing 2019 CPE Forecast: Higher than 2018 due to higher revenue requirements in 2019. Currently below Budget of 13.39 due to increase in forecasted non-airline 15,682 revenues 2019 Revenue Sharing down from 2018 based on change from 40% to 20% sharing 18 Non-Aeronautical Performance 10.22 YTD 2019 vs. 2018: Revenues 4.8% Increase Expenses 8.3% Increase NOI 2.0% Increase Revenue growth: Public parking ADR GT Clubs and Lounges ADR, parking and TNCs driving positive revenue variance in 2019 forecast 19 Total Operating Expense Performance 14.42 363,640 366,105 Q2 YTD: $11.4M favorable, 6.1% 2019 Forecast vs Budget : $2.5M favorable, 0.7% 2019 Forecast under-run driven primarily by: Cost allocations to Aviation from other divisions due to delayed project and program spending Anticipate cost savings due to delayed project and program spending 20 Capital Spending 2019 Forecast: IAF = $339M NSAT = $133M Other = $188M Major 2019 Variances: IAF = $38M NSAT= $8M Service Tunnel Renewal = $4M SSAT Renov. Project = $3.5M ARC Flash Mitigation = $3.4M Fire Station Westside= $3M Automated Security Lane = $1.9M Other - $46M 2019 spending variances primarily due to delayed spending, not project savings 21 FTE Staffing Status June YTD: Average Total FTE Vacancy Rate = 8.82% Existing FTE Vacancy Rate = 6.96% New 2019 FTE Vacancy Rate = 44.82% Approved Budget = 1105.78 FTEs New FTEs = 54.37 (included in the Total) Vacancy Rate for existing FTEs, June YTD = 6.96% 22 Maritime Division Q2 2019 Financial Performance Report Business Highlights Cruise Successful first arrival of the Norwegian Joy and Royal Caribbean's Ovation of the Seas. Eighty percent of business volume now under contracted commitment. Received feedback on RFQ and selected three entities to participate in the RFP process. Elliott Bay Fishing & Commercial Operations The 680' Ocean Phoenix fished her last season of Pollock. She has been a 30+year tenant of the port, employing 225 crew, and bringing 4,200 tons of product annually to Pier 90. The 367' M/V Excellence has been overhauled to help absorb the processing capacity of the Ocean Phoenix. Recreational Boating Bids closed for Shilshole Bay Marina's customer service facility buildings. Building on 4th year in a row with zero injuries. Seaport Environmental Completed installation of 390 solar panels, each with 300 watts at P69. Project came in under budget with 66% of costs recovered by the grant. Stormwater Utility - Completed installation of a rain garden adjacent to the bike path at Terminal 86 and new drainage system in Cruise passenger area at Pier 91. Managing growth and environmental stewardship 24 Maritime Financial Highlights Maritime 2019 NOI is $3,435K favorable to budget and $516K higher than 2018 YTD 2019 Revenue unfavorable to budget by $550K due to cruise schedule and late berthing agreement. YTD 2019 Revenue $1,110K or 4% higher than 2018 driven by Salmon Bay Marina acquisition, Recreational Boating & Cruise rate increases offset by reduction in Grain volumes and leases from WSDOT. Expenses $3,985K favorable to budget driven by Cruise consulting and marketing, Maintenance timing, and unfilled positions. Expense are up $594K or 3% Y/Y. 11% of Capital budget was Fav (UnFav) Incr (Decr) spent in the 1st half, with 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % annual forecast at 86% of Total Revenues 24,525 26,257 27,368 27,918 (550) -2% 1,110 4% budget. Total Operating Expenses 19,690 21,716 22,310 26,295 3,985 15% 594 3% Net Operating Income 4,835 4,541 5,058 1,623 3,435 212% 516 11% Stormwater Utility is Depreciation 8,442 8,823 8,911 8,804 (107) -1% 88 1% tracking to budget. Net Income (3,606) (4,281) (3,853) (7,181) 3,328 46% 429 10% Revenue growth continues to outpace spending growth 25 Maritime Division Financial Trends In 000s 2019 Forecast Drivers: 80,000 70,000 Revenue 1. Grain Terminal uncertainty. 60,000 2. Cruise occupancy and unplanned visits. 50,000 Depreciation 3. Utilization of Elliott Bay moorage and dockage facilities. 40,000 Allocation 30,000 Operating Expense Expense Revenue 1. Non-capitalizable consulting and 20,000 outside services related to new cruise terminal/berth. 10,000 2. Port Valet service costs. - 3. Tenant improvement costs. 2014 2015 2016 2017 2018 2019 2019 4. Central Services allocation. Forecast Budget 5. Maintenance spend. Operateing profit forecasted over $2M higher than budget 26 Cruise Financial Trends In 000s 2019 Forecast Drivers: 25,000 Revenue 20,000 1. Will occupancy continue to exceed 104% with bigger ships in Q3. 15,000 Depreciation 2. Unplanned port of call visits. Allocation Expense 10,000 Operating Expense 1. Non-capitalizable consulting Revenue and outside services related 5,000 to new cruise terminal/berth. 2. Port Valet service costs. 3. Maintenance spend. - 4. Change of allocation 2016 2017 2018 Actual 2019 Forecast 2019 Budget methodology for shared properties. Individual business lines forecast to budget as of Q2 2019. Agreements and schedule changes driving revenue from Q2 to Q3 27 Recreational Boating Financial Trends In 000s 2019 Forecast Drivers: 16,000 Revenue 14,000 1. Utilization of guest 12,000 moorage. 2. Occupancy rates. 10,000 Depreciation 8,000 Allocation Expense 1. Maintenance costs. 6,000 Operating Expense 2. Open staffing positions. Revenue 4,000 2,000 - 2016 2017 2018 2019 Forecast 2019 Budget Individual business lines forecast to budget as of Q2 2019. Includes Shilshole Bay Marina, Bell Harbor Marina, and Harbor Island Marina. Tracking to budget 28 Ship Canal Fishing & Ops Trends In 000s 2019 Forecast Drivers: 10,000 Revenue 9,000 1. Backfill with recreational 8,000 vessels while Fishermen's Terminal fishing vessels at 7,000 sea. 6,000 Depreciation 2. Events such as the Seattle 5,000 Allocation Boat Show. Operating Expense 4,000 Expense Revenue 3,000 1. Maintenance, both planned and unplanned. 2,000 2. Remediation tied to 1,000 Fishermen's Terminal - redevelopment. 2016 2017 2018 2019 Forecast 2019 Budget 3. Unfilled positions. Individual business lines forecast to budget as of Q2 2019. Includes Fishermen's Terminal, Maritime Industrial Center, and Salmon Bay Marina. Integrating Salmon Bay Marina 29 Elliott Bay Fishing & Commercial Ops Trends In 000s 2019 Forecast Drivers: 12,000 Revenue 1. Long term occupancy by large 10,000 fishing vessels at T91. 2. Event moorage. 8,000 3. Utilization of smaller Depreciation moorage/dockage on the 6,000 Allocation south end and up the Operating Expense Duwamish. 4,000 Revenue Expense 1. Maintenance, both planned 2,000 and unplanned. 2. Security and allocations. - 2016 2017 2018 2019 Forecast 2019 Budget Individual business lines forecast to budget as of Q2 2019. Includes Terminal 91 (waterside non-Cruise), Terminal 46 Docks, Kellogg Island, Terminal 25, Terminal 18 Dolphins, Pier 69 Vessels, Pier 28 Docks, Pier 34 Dolphins, Pier 2 Docks, and Terminal 108 Moorage. Rate increases offset by less utilization than expected 30 Maritime Portfolio Management Trends In 000s 2019 Forecast Drivers: 18,000 Revenue 16,000 1. Ability to backfill leases at T106. 14,000 2. Filling the C3 building at the 12,000 Maritime Industrial Center. Depreciation 10,000 Allocation Expense 8,000 Operating Expense 1. Non-capitalizable tenant 6,000 improvements. Revenue 2. Maintenance spend. 4,000 3. Change of allocation 2,000 methodology for shared properties. - 2016 2017 2018 2019 Forecast 2019 Budget Individual business lines forecast to budget as of Q2 2019. Includes uplands of Shilshole Bay Marina, Terminal 91 (Industrial), Fishermen's Terminal, Maritime Industrial Center, Salmon Bay Marina, T-115, T-108, and T-106. Leasing closer to market and managing costs 31 Grain Terminal Goal: Net Income Maximized In 000s 6,000 2019 Forecast Drivers: 5,000 Revenue 4,000 1. Impact of tariffs. Depreciation 2. Weather. 3,000 Allocation Operating Expense Expense 2,000 1. Maintenance and Revenue allocations. 1,000 - 2016 2017 2018 2019 Forecast 2019 Budget Individual business lines forecast to budget as of Q2 2019. Navigating volatility of tariffs and soybean exports 32 Northwest Seaport Alliance Summary Fav (UnFav) Incr (Decr) NWSA TEU Data 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Budget $ % $ % YTD Volumes up, but Tariffs are the wildcard. As trade Revenue 92,371 98,997 97,497 1,500 2% 6,626 7% shifts from China to SE Asia, there is risk volumes could Operating expense 41,151 51,212 54,620 3,408 6% 10,061 24% shift to East Coast ports due to the shorter transit. Operating Income 51,220 47,785 42,877 4,908 11% (3,435) -7% Interest Income 567 856 700 (156) -22% 289 51% Exports: Market Value Adjustment (179) 330 0 (330) NA 509 -284% YTD May 2018, China was #1 export partner, YTD May Net Interest Income 388 1,186 700 486 69% 798 206% 2019, China is #3 with export TEU volumes down 34%. Non Operating Income (Expense) 31 (322) (1,026) (704) 69% (353) -1139% Biggest declines in hay/forage products, waste paper Grant Income 50 1,246 1,695 449 26% 1,196 2392% and whey/milk products. Net Income 51,689 49,895 44,246 5,649 13% (1,794) -3% India exports are also impacted by trade war, and Cargo TEUs 1,779,706 1,915,249 135,543 8% exports there are also down 34%. Their ranking went Cargo Volume (Metric Tons) 13,963,966 15,129,071 1,165,105 8% from #5 to #6. Biggest declines in apples (5,792 TEUs!) and waste paper. Note: Results may differ slightly from NWSA site due to rounding differences Revenue - Non-container business Expenses Growth from 2018 Imports $3.1M favorable to budget from driven by one-time crane removal Imports from China are down 0.2% YTD, -718 TEUs. higher than expected military and costs at T18 & T46 along with Imports from other countries are up (Japan +12%, auto volumes. volume related costs. Taiwan +27%, Vietnam +27%, Thailand +55% (growth on smaller volumes) Favorable Net Income to budget, but tariffs impacting Y/Y growth 33 Economic Development Division Q2 2019 Financial Performance Report Economic Development Division Business Highlights 35 Real Estate Development Issued RFP to redevelop Terminal 106 and received strong response . Received Commission approval to surplus and sell small property on Harbor Avenue. Received Commission authorization to start design work on Historic Ship Supply building at Fishermen's Terminal. Finalized appraisal of WA Dept. of Transportation property adjacent to the Port's Des Moines Creek West property. This property enhances development potential of our property. Staff is starting negotiations with WSDOT now that we have agreed on site's value. Launching development projects 36 Portfolio Management Received Commission authorization to start construction/modernization of Bell Harbor Conference Center Secured a maritime-related tenant to lease the office building at Salmon Bay Marina, resulting in 100% occupancy on the uplands. Leased an additional 98,400 square feet of yard space at Terminal 91. Brought in Origin Seafoods to Terminal 102. They will sell seafood online, then portion, fulfill, and ship orders at the terminal. Maintaining strong occupancy 37 Diversity in Contracting Published the first Diversity in Contracting Annual Report. It highlighted the Port's 2018 WMBE results (11.8%) and 2019 WMBE utilization goals (12.4%*) Posted first quarterly Diversity in Contracting article and blogs on the Port of Seattle's website and external news/media outlets. Port had 16.1% WMBE utilization after Q1 2019. Staff is now tracking utilization quarterly across all divisions/departments Held a PortGen Maritime event with 70 attendees learning about the upcoming Maritime Projects, the Maritime's 2019 WMBE aspirational goal, and the Port's new Diversity in Contracting Program. Presented the Port's aspirational goals and new affirmative efforts required by those Primes interested in doing business with the Port to the Construction Management Associations of America Implementing the Port's new Diversity in Contracting Program *not including construction 38 Tourism Thirty organizations received 2019 tourism grants from the Port of Seattle. New recipients include: Goldendale Chamber of Commerce promoting the Goldendale Observatory, the Suquamish Museum targeting travelers in Seattle hotels and Methow Trails will improve their website promoting outdoor winter activities. Twenty four recipients were awarded Airport Spotlight advertising grants. Current recipients include Lewis County, Suquamish Tribal Museum, Sequim Lavender Farmers, Long Beach Visitors Bureau and Methow Trails. Selected Core Communications to provide tourism marketing programs on behalf of the Port of Seattle's international tourism efforts. Participated in Aer Lingus Tour America travel show, ITB Berlin, Visit Seattle's Korea Sales Mission and Active America China travel trade show to educate travel trade, tour operators and travel media about cruising from Seattle to Alaska and promote SeaTac International Airport as the gateway for international arriving visitors. Supporting Tourism Marketing programs and promoting gateway facilities 39 Workforce Development 14 aspiring ironworkers graduated from the union's second pre-apprenticeship cohort. 13 are now enrolled apprentices. The group has earned $140, 937 ($24+/hour) so far. ANEW also hosted a graduation event for their second cohort of construction pre- apprentices. They had 14 people complete their construction program. Starting wages for graduates from this program range from $22-27/hour Released RFP to operate Career Advancement Center at Seatac International Airport. Bids are due in July and we expect to award contracts and start services in Q4 2019. Organized and held awareness event focused on recreational boating and maritime careers with youth from Upward Bound. Along with learning about maritime careers, over 50 diverse youth experienced sailing on the Adventuress Continued efforts on Workforce Development Initiatives 40 EDD Partnership Program YTD - Approximately $795,900 has been awarded to 25 cities in 2019 King County cities have committed to $584,000 in matching funds and in-kind resources Hosting 4 economic development partnership meetings with cities on topics like: Roundtable discussion on small business development resources Greater Seattle Partners update and discussion about strategic plan Presentation by Seattle Metro. Chamber on new Business Retention/Expansion program Continued Economic Development Partnership Program 41 Economic Development Financial Highlights 2019 Q2 NOI $3,132K favorable to budget and $668K greater than 2018 Revenue favorable to budget by $367K and $619K greater than 2018 driven by favorable volumes at the Conference and Event Centers. Annual revenue forecast at budget and 5% below 2018 from anticipated closures related to Conference and Event Center modernization project. Expenses favorable to budget by $2,716K driven by timing of Economic Development grant matching funds, timing initiative programs, favorable P66 allocation methodology change, and underspend in central services. Expenses are flat on a Y/Y basis. Annual expenses forecasted to 6% under budget and 6% higher than 2018 due to primarily to higher spending in initiative programs. 25 % of Capital budget Fav (UnFav) Incr (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 was spent in the 1st half, $ in 000's Actual Actual Actual Budget $ % $ % with annual forecast at Total Revenues 7,727 9,765 10,384 10,017 367 4% 619 6% 87% of budget. Total Operating Expenses 12,067 12,880 12,972 15,688 2,716 17% 92 1% Net Operating Income (4,340) (3,115) (2,588) (5,670) 3,082 54% 527 17% Depreciation 1,860 1,999 1,859 1,908 50 3% (141) -7% Net Income (6,201) (5,114) (4,447) (7,579) 3,132 41% 668 13% YTD Revenue exceeding plan, expenses below budget 42 Economic Development Division Financial Trends In 000s 2019 Forecast Drivers: 40,000 Revenue 35,000 1. Impact of Conference and 30,000 Event Center Modernization. Depreciation 2. Lessee turnover and ability to 25,000 expand unplanned space Allocation 20,000 rental. *Program Expense 15,000 **Operating Expense Expense 10,000 1. Program spend / execution. Revenue 2. Tenant Improvements. 5,000 3. Maintenance spend. - 4. RE development costs. 2014 2015 2016 2017 2018 2019 2019 (5,000) Forecast Budget * Includes Small Business, Tourism, Workforce Development, Real Estate Development, and Economic Development Grants. ** Includes Portfolio Management, Division Management, Facilities, and Other. Forecasting $1,147K favorable to budget 43 Portfolio Management Trends in 000s 2019 Forecast Drivers: 35,000 Revenue 1. Impact of Conference and 30,000 Event Center 25,000 Modernization. 2. Lessee turnover and ability Depreciation 20,000 to expand unplanned space Allocation rental. 15,000 Operating Expense Expense Revenue 10,000 1. Tenant improvements. 2. Maintenance spend. 5,000 3. Costs associated with transitioning the NWSA - leasing software. 2016 2017 2018 2019 Forecast 2019 Budget Individual business lines forecast to budget as of Q2 2019. Includes non-alliance & upland real-estate at Tsubota, T-91 (General), T-86, P-69, Bell Street Garage, Smith Cove Conference Center, Bell Harbor Conference Center, World Trade Center, Foreign Trade Zone, Pier 2, T-34, and T-102. Increasing margins 44 Central Services Q2 2019 Financial Performance Report Central Services Business Highlights The Port adopted the Duwamish Valley Community Equity Program and held the Duwamish Alive community restoration event at T117. The Port of Seattle released the Comprehensive Annual Financial Report (CAFR) and received a clean independent Certified Public Accountant (CPA) audit opinion on financial statements. Completed Phase 2 of Port Website Redesign project which included adding the Maritime Moorage Application and filtered lists for Commission items. Replaced the Aviation Stormwater GIS which will allow for upstream or downstream stormwater contamination tracking along a properly constructed pipe network. A new Project Delivery system for smaller and major construction projects is being developed to replace two legacy project management solutions and streamline key processes. Port of Seattle Police department instructors provided Rapid Response trainings to airport/airline employees. Hosted Career Awareness events: ICT with Mt. Rainier High School, Construction & Design with Foster High School, Young Entrepreneurs with Highline High School. Achieved a number of accomplishments in Q2. 46 Central Services Financial Highlights Q2 YTD Actual: o Operating expenses are $7.0M favorable to budget mainly due to staff vacancies and project delays. o Operating expenses are $3.7M higher than 2018 mainly due to higher Payroll costs and more Outside Services. Year-End Forecast: o Operating expenses forecast are $6.3M favorable to budget due to savings in Payroll and Outside Services. o Operating expenses forecast are $17.3M higher than 2018 due to higher payroll and more project-related expenses. Forecasting a $6.3M favorable budget variance for the year. 47 Central Services Financial Trends In 000s Core Central Support Services Police Capital Development Environment & Sustainability 160 o Operating expenses forecast are $17.3M higher than 2018 140 due to higher payroll and more 120 project-related expenses. o Major changes from 2018 are 100 as follows : o Core Central Support 80 Services: $7.6M o Police: $5.7M 60 o Environment & Sustainability: $3.3M 40 o Capital Development: $726K 20 - 2015 2016 2017 2018 2019 Fcst 2019 Bud Expenses are $7.0M favorable to the budget YTD 48 Appendix Q2 2019 Financial Performance Report Portwide Financial Summary Fav (UnFav) Incr (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % Aeronautical Revenues 127,780 147,570 175,927 177,039 (1,112) -0.6% 28,357 19.2% Airport Non-Aero Revenues 112,761 118,864 124,604 121,045 3,560 2.9% 5,740 4.8% Non-Airport Revenues 61,548 64,054 67,632 62,229 5,403 8.7% 3,578 5.6% Total Operating Revenues 302,088 330,489 368,164 360,313 7,851 2.2% 37,676 11.4% Total Operating Expenses 174,104 191,577 216,758 232,756 15,999 6.9% 25,181 13.1% NOI before Depreciation 127,984 138,912 151,407 127,557 23,850 18.7% 12,495 9.0% Depreciation 81,860 81,949 82,481 81,933 (548) -0.7% 532 0.6% NOI after Depreciation 46,124 56,963 68,926 45,624 23,302 51.1% 11,963 21.0% Strong YTD financial performance 50 Non-Airport Financial Summary Fav (UnFav) Incr (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % NWSA Distributable Revenue 27,283 25,844 24,941 21,955 2,986 13.6% (903) -3.5% Maritime Revenues 24,525 26,257 27,368 27,918 (550) -2.0% 1,110 4.2% EDD Revenues 7,727 9,765 10,384 10,017 367 3.7% 619 6.3% SWU & Other 2,012 2,187 4,939 2,338 2,601 111.2% 2,752 125.8% Total Operating Revenues 61,548 64,054 67,632 62,229 5,403 8.7% 3,578 5.6% Total Operating Expenses 33,783 38,141 40,522 45,171 4,649 10.3% 2,381 6.2% NOI before Depreciation 27,765 25,913 27,110 17,058 10,051 58.9% 1,197 4.6% Depreciation 20,272 19,988 19,623 18,909 (715) -3.8% (365) -1.8% NOI after Depreciation 7,493 5,925 7,487 (1,850) 9,337 -504.7% 1,562 26.4% Non-Airport NOI outperformed budget by $10.1M in Q2 51 Portwide Operating Revenues Summary Fav (UnFav) Incr (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % Aeronautical Revenues 127,780 147,570 - 175,927 - 177,039 (1,112) - -0.6% 28,357 19.2% Public Parking 36,958 39,402 40,401 40,969 (568) -1.4% 999 2.5% Rental Cars - Operations 14,514 14,922 15,560 15,123 437 2.9% 637 4.3% Rental Cars - Operating CFC 3,284 5,497 4,505 4,657 (153) -3.3% (993) -18.1% ADR & Terminal Leased Space 28,420 30,179 32,689 30,754 1,936 6.3% 2,510 8.3% Ground Transportation 7,633 8,885 9,979 9,413 567 6.0% 1,094 12.3% Employee Parking 4,674 5,191 5,193 4,876 317 6.5% 2 0.0% Airport Commercial Properties 10,708 7,593 7,072 6,703 369 5.5% (521) -6.9% Airport Utilities 3,423 3,438 3,665 3,932 (267) -6.8% 227 6.6% Clubs and Lounges 2,173 2,773 4,456 3,626 830 22.9% 1,683 60.7% Cruise 6,325 6,806 8,473 9,114 (641) -7.0% 1,668 24.5% Recreational Boating 5,438 6,125 6,228 6,358 (131) -2.1% 102 1.7% Fishing & Operations 4,440 4,565 5,071 4,972 99 2.0% 506 11.1% Grain 3,042 3,123 2,567 2,423 144 5.9% (556) -17.8% Maritime Portfolio Management 5,267 5,628 5,019 5,052 (33) -0.6% (609) -10.8% Central Harbor Management 4,161 4,557 4,406 4,399 7 0.2% (151) -3.3% Conference & Event Centers 3,545 5,188 5,963 5,604 360 6.4% 775 14.9% NWSA Distributable Revenue 27,283 25,844 24,941 21,955 2,986 13.6% (903) -3.5% Other 3,021 3,201 6,049 3,346 2,703 80.8% 2,848 89.0% Total Operating Revenues (w/o Aero) 174,309 182,918 192,237 183,274 8,963 4.9% 9,318 5.1% TOTAL 302,088 330,489 368,164 360,313 7,851 2.2% 37,676 11.4% Operating revenues exceeded budget by $7.9M 52 Portwide Operating Expense Summary Fav (UnFav) Incr (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % Salaries & Benefits 56,338 62,772 66,334 69,636 3,302 4.7% 3,562 5.7% Payroll expenses were $3.3M Wages & Benefits 52,948 60,075 64,035 63,866 (169) -0.3% 3,960 6.6% below budget due to staff Payroll to Capital Projects 12,873 13,602 13,523 16,640 3,117 18.7% (79) -0.6% vacancies. Equipment Expense 4,311 3,866 4,484 4,136 (347) -8.4% 618 16.0% Outside Services were $11.4M Supplies & Stock 4,616 4,633 5,290 4,452 (838) -18.8% 657 14.2% favorable to budget due to timing of spending, project Outside Services 32,969 38,460 43,951 55,365 11,415 20.6% 5,491 14.3% delays, and some actual Utilities 11,911 13,453 13,103 14,963 1,860 12.4% (350) -2.6% savings. Travel & Other Employee Expenses 2,338 2,303 2,487 3,909 1,422 36.4% 184 8.0% Supplies & Stock were $838K Promotional Expenses 460 964 890 1,360 470 34.6% (74) -7.7% over budget mainly due to Other Expenses 16,865 15,550 27,560 27,939 379 1.4% 12,010 77.2% more De-icing Materials for Charges to Capital Projects/Overhead Alloc (21,524) (24,100) (24,898) (29,511) (4,613) 15.6% (798) 3.3% snow removal. TOTAL 174,104 191,577 216,758 232,756 15,999 6.9% 25,181 13.1% Operating expenses were $16.0M below budget 53 Portwide Financial Summary YE Forecast Fav (UnFav) Incr (Decr) 2017 2018 2019 2019 Budget Variance Change from 2018 $ in 000's Actual Actual Forecast Budget $ % $ % Aeronautical Revenues 264,114 291,268 364,646 365,604 (958) -0.3% 73,378 25.2% Airport Non-Aero Revenues 236,803 257,707 270,014 259,537 10,477 4.0% 12,307 4.8% Non-Airport Revenues 131,114 140,415 133,328 128,115 5,213 4.1% (7,087) -5.0% Total Operating Revenues 632,031 689,390 767,988 753,255 14,733 2.0% 78,598 11.4% Total Operating Expenses 372,982 397,638 448,162 454,986 6,824 1.5% 50,524 12.7% NOI before Depreciation 259,049 291,752 319,826 298,269 21,557 7.2% 28,074 9.6% Depreciation 165,021 164,362 168,676 168,676 - 0.0% 4,314 2.6% NOI after Depreciation 94,028 127,390 151,150 129,593 21,557 16.6% 23,760 18.7% Expect strong financial performance results for 2019 54 Capital Spending by Division 2019 YTD 2019 2019 Budget Variance $ in 000's Actual Forecast Budget $ % Aviation 280,124 659,813 767,732 107,919 14.1% Maritime 1,879 15,105 17,638 2,533 14.4% Economic Development 1,444 5,040 5,713 673 11.8% Central Services & Other (note 1) 4,007 16,581 25,203 8,622 34.2% TOTAL 287,454 696,539 816,286 119,747 14.7% Note: (1) "Other" includes Street Vacation projects and Storm Water Utility Small Capital projects. Capital spending was $287.5M for Q2 2019 55 Aviation Division Appendix Passengers (Growth Comparison) Passenger updated growth forecast is 4% vs. initial 3% 57 Airport Activity % Change Passenger Activity YTD 2017 YTD 2018 YTD 2019 from 2018 Change 2019 Market Total Passengers (000's) Airline 2018 v. 2019 Share Domestic 19,666 20,897 21,616 3.4% Alaska 3.6% 48.5% International 2,484 2,611 2,689 3.0% Delta 11.5% 24.2% United -9.0% 5.5% Total 22,150 23,508 24,304 3.4% Southwest -8.3% 5.5% Operations 199,610 210,722 214,749 1.9% American 3.2% 5.1% Landed Weight (In Millions of lbs.) Cargo 1,025 1,147 1,165 1.5% Q2 2019: All other 12,416 13,328 13,738 3.1% Passengers Total 13,441 14,476 14,903 3.0% YTD passenger growth of Cargo - Metric Tons 3.4% tracking ahead of Domestic freight 110,915 114,627 118,401 3.3% 2019 budget based on International freight 57,633 64,749 63,388 -2.1% 3.0% growth, but just Mail 28,882 28,326 28,314 0.0% short of updated forecast Total 197,430 207,702 210,103 1.2% based on 4% growth. 2019 YTD total passenger growth of 3.4% 58 Aviation Financial Summary Fav (UnFav) Incr (Decr) 2017 2018 2019 2019 Budget Variance Change from 2018 $ in 000's Actual Actual Forecast Budget $ % $ % Operating Revenues: Aeronautical Revenues 264,114 291,268 364,646 365,604 (957) -0.3% 73,378 25.2% Non-Aeronautical Revenues 236,803 257,707 270,014 259,537 10,477 4.0% 12,307 4.8% Total Operating Revenues 500,916 548,975 634,660 625,140 9,520 1.5% 85,685 15.6% Total Operating Expense 299,114 318,849 363,640 366,105 2,465 0.7% 44,791 14.0% Net Operating Income 201,802 230,126 271,020 259,036 11,985 4.6% 40,894 17.8% Capital Expenditures 293,785 579,135 659,813 767,732 107,919 14.1% 80,678 13.9% (1) Annual non-cash amortization of $17.9M lease incentive related to the 5 year SLOA III agreement which ended in 2017. 2019 Forecasted NOI $12M favorable to budget 59 Key Performance Measures Fav (UnFav) Incr (Decr) CPE 2019 Forecast vs 2018 2017 2018 2019 2019 Budget Vairance Change from 2018 Actuals: Actual Actual Forecast Budget $ % $ % CPE increase Impacted by Key Performance Metrics SLOA IV reduction in Revenue Cost per Enplanement (CPE) 10.52 10.79 13.09 13.39 0.29 2.2% 2.31 21.4% Sharing to 20% in 2019 from Non-Aeronautical NOI (in 000's) 133,101 149,959 149,181 136,534 12,648 9.3% (778) -0.5% 40% in 2018 Other Performance Metrics Non- Aero NOI 2019 Forecast vs O&M Cost per Enplanement 12.77 12.81 14.05 14.42 0.37 2.6% 1.24 9.7% 2019 Budget: Non-Aero Revenue per Enplanement 10.11 10.35 10.43 10.22 0.21 2.0% 0.08 0.7% Non- Aero NOI growth due to Debt per Enplanement (in $) 114 133 121 123 2 1.6% (12) -8.9% higher forecasted Non -Aero Debt Service Coverage 1.57 1.66 1.67 1.65 0.03 1.6% 0.02 1.0% Revenue Days cash on hand (10 months = 304 days) 379 235 298 278 20 7.1% 63 26.6% Other Performance Metrics: Aeronautical Revenue Sharing ($ in 000's) (42,311) (36,863) (17,192) (15,682) (1,510) -9.6% 19,672 53.4% Aero Revenue Sharing Forecast reflects 20% Revenue Activity (in 000's) Sharing per SLOA IV. Enplanements 23,416 24,894 25,890 25,394 496 2.0% 996 4.0% Positive: Non-aero NOI above budget. CPE below budget. 60 Aviation Expense YTD Summary Fav (UnFav) Incr (Decr) 2019 YTD Actuals to YTD 2019 Budget 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % Expenses - $11.4M Favorable, driven by: Operating Expenses: Payroll 55,798 63,139 68,388 68,833 445 0.6% 5,249 8.3% Delayed Spending in Airport Expenses- Outside Services 17,203 21,015 24,456 29,412 4,956 16.9% 3,441 16.4% $5.7M Favorable: Utilities 8,389 9,589 9,288 10,683 1,395 13.1% (300) -3.1% Primarily driven by savings from Other Airport Expenses 13,680 9,788 14,240 11,605 (2,636) -22.7% 4,452 45.5% Outside Services due to delayed Total Airport Direct Charges 95,070 103,530 116,372 120,533 4,161 3.5% 12,842 12.4% spending in Aviation Planning, Capital Environmental Remediation Liability 2,714 4,484 12,543 14,204 1,661 11.7% 8,060 179.8% Development and Program Capital to Expense 24 8 83 - (83) N/A 75 937.6% Management, and Facilities and Total Exceptions 2,738 4,492 12,627 14,204 1,578 11.1% 8,135 181.1% Infrastructure, offset by snow related costs early in the year Total Airport Expenses 19.4% 97,808 108,021 128,998 134,737 5,739 4.3% 20,977 Delayed Spending in Other Divisions- Police Costs 9,146 10,659 11,117 12,589 1,472 11.7% 458 4.3% $5.6M Favorable: Capital Development 6,486 6,072 6,860 8,265 1,405 17.0% 788 13.0% Cost savings in allocations from other Other Central Services 25,000 26,714 27,221 29,416 2,195 7.5% 507 1.9% divisions due to planning project and Maritime/Economic Development 1,879 1,970 2,039 2,578 540 20.9% 69 3.5% program delays Total Charges from Other Divisions 42,512 45,414 47,237 52,848 5,612 10.6% 1,823 4.0% Total Operating Expense 140,320 153,436 176,235 187,585 11,350 6.1% 22,799 14.9% YTD Cost Savings due to delayed spending on projects 61 Aviation Expense YE Summary Fav (UnFav) Incr (Decr) 2019 Forecast to 2019 2017 2018 2019 2019 Budget Variance Change from 2018 Budget $ in 000's Actual Actual Forecast Budget $ % $ % Operating Expenses: Expenses - $2.5M Favorable Payroll 114,463 125,341 141,341 141,316 (25) 0.0% 15,999 12.8% driven primarily by: Outside Services 41,055 47,638 61,428 60,950 (479) -0.8% 13,791 28.9% Utilities 16,374 18,237 18,949 20,235 1,285 6.4% 712 3.9% Other Airport Expenses 28,292 25,125 25,710 22,692 (3,018) -13.3% 586 2.3% $2.5M estimated over- run Total Airport Direct Charges 200,184 216,341 247,429 245,192 (2,237) -0.9% 31,088 14.4% in Snow Removal related expenses (affecting Environmental Remediation Liability 8,812 6,233 14,865 14,259 (605) -4.2% 8,632 138.5% Payroll, Outside Services, Capital to Expense 2,856 6,891 - - - 0.0% (6,891) -100.0% and other Airport Total Exceptions 11,668 13,124 14,865 14,259 (605) -4.2% 1,741 13.3% Expenses), absorbed Total Airport Expenses 211,852 229,465 262,294 259,451 (2,842) -1.1% 32,829 14.3% largely by forecasted cost savings in allocations from 30.7% Police Costs 17,652 19,231 25,137 25,137 - 0.0% 5,906 other divisions due to Capital Development 14,701 12,607 13,196 16,242 3,047 18.8% 588 4.7% spending delays in Capital Other Central Services 51,004 53,121 57,869 60,129 2,260 3.8% 4,748 8.9% Development (AV PMG) Maritime/Economic Development 3,904 4,425 5,145 5,145 1 0.0% 720 16.3% Total Charges from Other Divisions 87,262 89,384 101,346 106,654 5,307 5.0% 11,962 13.4% Total Operating Expense 299,114 318,849 363,640 366,105 2,465 0.7% 44,791 14.0% Projected cost savings due to delayed project and program spending 62 Aeronautical Business YTD Fav (UnFav) Incr (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 2019 YTD Actuals to YTD 2019 $ in 000's Actual Actual Actual Budget $ % $ % Budget Revenues: Movement Area 50,849 59,656 61,289 61,987 (697) -1.1% 1,634 2.7% Aero Revenue $1.1M lower, and within 1% of Budget Apron Area 7,636 8,209 9,883 9,456 427 4.5% 1,674 20.4% Terminal Rents 78,051 83,956 100,229 100,032 197 0.2% 16,272 19.4% Aero Expenses $6.4M Federal Inspection Services (FIS) 6,708 6,641 7,271 7,086 185 2.6% 630 9.5% favorable mostly driven by lower Total Rate Base Revenues 143,243 158,462 178,672 178,561 111 0.1% 20,210 12.8% allocations from other divisions due to delays in project work Commercial Area 4,959 5,072 5,569 6,319 (750) -11.9% 497 9.8% Subtotal before Revenue Sharing 148,202 163,534 184,241 184,880 (639) -0.3% 20,707 12.7% Revenue Sharing (18,635) (15,964) (8,314) (7,841) (473) -6.0% 7,650 47.9% Total Aeronautical Revenues 129,567 147,570 175,927 177,039 (1,112) -0.6% 28,357 19.2% Total Aeronautical Expenses 91,209 100,511 118,919 125,356 6,437 5.1% 18,408 18.3% Net Operating Income 38,358 47,059 57,008 51,683 5,326 10.3% 9,949 21.1% Aeronautical NOI higher due to YTD project delays 63 Aeronautical Business YE Fav (UnFav) Incr (Decr) 2019 Forecast to Budget 2017 2018 2019 2019 Budget Variance Change from 2018 $ in 000's Actual Actual Forecast Budget $ % $ % Revenue - $1M unfavorable Revenues: Movement Area 108,638 116,703 128,896 130,873 (1,976) -1.5% 12,194 10.4% Rate based revenue $1M lower Apron Area 16,771 15,627 19,513 19,714 (202) -1.0% 3,886 24.9% driven primary by higher year-end Terminal Rents 155,431 169,318 205,142 203,319 1,824 0.9% 35,824 21.2% forecasted non-aeronautical revenue which drives revenue Federal Inspection Services (FIS) 18,612 16,226 15,171 14,521 650 4.5% (1,055) -6.5% sharing to airlines to be higher, Total Rate Base Revenues 299,452 317,874 368,722 368,426 296 0.1% 50,848 16.0% resulting in lower aeronautical revenues Commercial Area 10,574 10,257 13,116 12,859 256 2.0% 2,858 27.9% Subtotal before Revenue Sharing 310,026 328,131 381,838 381,286 552 0.1% 53,707 16.4% Revenue sharing $1.5M - higher Revenue Sharing (42,311) (36,863) (17,192) (15,682) (1,510) -9.6% 19,672 53.4% due to higher non-aero NOI forecast partially offset by Other Prior Year Revenues (26) - - - - 0.0% - reduction of revenue sharing Total Aeronautical Revenues 267,690 291,268 364,646 365,604 (957) -0.3% 73,378 25.2% percentage from 40% to 20%, based on SLOA IV provisions Total Aeronautical Expenses 195,414 211,101 242,808 243,102 294 0.1% 31,706 15.0% Net Operating Income 72,276 80,167 121,839 122,502 (663) -0.5% 41,672 52.0% Debt Service (1) (86,564) (91,673) (111,673) (109,343) (2,330) -2.1% (20,000) -21.8% Net Cash Flow (14,288) (11,506) 10,166 13,159 (2,993) 22.7% 21,672 188.4% Lower Aeronautical Revenues primarily driven by higher forecasted revenue sharing 64 Aero Cost Drivers 2019 Forecast to 2019 Budget O&M ($1.2M) lower primarily Fav (UnFav) Incr (Decr) driven by impact of snow 2017 2018 2019 2019 Budget Variance Change from 2018 events in Q1, offset by larger Corporate and AV $ in 000's Actual Actual Forecast Budget $ % $ % Planning/F&I savings O&M 192,188 206,076 236,175 237,387 (1,212) -0.5% 30,099 14.6% Debt Service - $1.2M increase Debt Service Gross 113,832 115,419 137,696 136,513 1,183 0.9% 22,277 19.3% due to increase in Rate Base of NS NSAT Renov Phase 1 in- Debt Service PFC Offset (33,057) (32,987) (33,060) (33,045) (15) 0.0% (73) 0.2% service ($3.5M), offset by Amortization 29,654 32,371 30,583 30,121 463 1.5% (1,787) -5.5% 2015A bond principal Space Vacancy (2,264) (2,132) (1,614) (1,521) (93) 6.1% 518 -24.3% paydown ($1.86M), projects delay on Hardstand TSA Operating Grant and Other (901) (873) (1,058) (1,028) (30) 2.9% (185) 21.2% Equipment Purchase ($300K) Rate Base Revenues 299,452 317,874 368,722 368,426 296 0.1% 50,848 16.0% & GBAS Upgrade ($145K). Commercial area 10,574 10,257 13,116 12,859 256 2.0% 2,858 27.9% Amortization - $463K increase Total Aero Revenues 310,026 328,131 381,838 381,286 553 0.1% 53,707 16.4% due to Public Expense Projects -Flight Corridor Safety ($102K); IAF FAA Fiber Optic Cable Replacement ($169K) & Vanderlande Screening Lanes ($136K) Aero rate base revenues based on cost recovery formulas 65 Aero Revenue Sharing Fav (UnFav) Incr (Decr) 2017 2018 2019 2019 Budget Variance Change from 2018 $ in 000's Actual Actual Forecast Budget $ % $ % Aero Revenues (incl' commercial) 310,026 328,131 381,838 381,286 553 0.1% 53,707 16.4% Non-Aeronautical Revenues 236,803 257,707 270,014 259,537 10,477 4.0% 12,307 4.8% Total O&M Expenses (299,114) (318,849) (363,640) (366,119) 2,479 -0.7% (44,791) 14.0% Net Operating Income 247,714 266,989 288,212 274,703 13,509 4.9% 21,223 7.9% ADF Interest Income 4,242 3,752 6,352 6,352 - 0.0% 2,600 69.3% Security Checkpoint TSA Grant 1,039 1,001 1,028 1,028 - 0.0% 27 2.7% Misc. Non-Operating Expenses (1,799) (1,586) (1,311) (1,311) - 0.0% 275 -17.4% CFC Excess (2,750) (7,724) (4,683) (3,993) (689) 17.3% 3,041 -39.4% Available for Debt Service [a] 248,446 262,433 289,599 276,780 12,819 4.6% 27,166 10.4% Debt Service 131,060 136,218 162,912 158,696 4,217 2.7% 26,694 19.6% Debt Service x 1.25 [b] 163,825 170,273 203,640 198,369 5,271 2.7% 33,367 19.6% Available for revenue sharing [c]=[a]-[b] 84,621 92,159 85,959 78,410 7,549 9.6% (6,201) -6.7% Revenue Sharing [d]=[c]*0.5 42,310 (1) 36,864 17,192 15,682 1,510 9.6% (19,672) -53.4% Higher revenue sharing percentage due to higher forecasted non-aero NOI 66 Non-Aeronautical Business YTD Fav (UnFav) Incr (Decr) 2019 YTD Actuals to YTD Prior Year 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 Non-Aero Revenue - $ in 000's Actual Actual Actual Budget $ % $ % Rental Car relatively flat to PY, Non-Aero Revenues primarily due to change in Rental Cars - Operations 14,514 14,922 15,560 15,123 437 2.9% 637 4.3% customer preference most Rental Cars - Operating CFC 3,284 5,497 4,505 4,657 (153) -3.3% (993) -18.1% noticeable in decline in 1-day Public Parking 36,958 39,402 40,401 40,969 (568) -1.4% 999 2.5% rentals Ground Transportation 7,633 8,885 9,979 9,413 567 6.0% 1,094 12.3% GT TNC revenue growth Airport Dining & Retail 26,349 27,694 29,581 28,199 1,383 4.9% 1,887 6.8% exceeds 27% YOY, partially Non-Airline Terminal Leased Space 2,071 2,485 3,108 2,555 553 21.6% 623 25.1% offset by decline in demand for Commercial Properties 10,708 7,593 7,072 6,703 369 5.5% (521) -6.9% taxis. Utilities 3,423 3,438 3,665 3,932 (267) -6.8% 227 6.6% Clubs demand driven growth Employee Parking 4,674 5,191 5,193 4,876 317 6.5% 2 0.0% ADR Reopening of Terminal Clubs and Lounges 2,173 2,773 4,456 3,626 830 22.9% 1,683 60.7% and NSAT concessions driving Other 973 983 1,085 993 92 9.3% 102 10.4% strong growth Total Non-Aero Revenues 112,761 118,864 124,604 121,045 3,560 2.9% 5,740 4.8% Non-Aero Expenses YOY growth reflects planned initiatives in the Total Non-Aero Expenses 49,111 52,925 57,316 62,229 4,913 7.9% 4,391 8.3% 2019 Budget Net Operating Income 63,649 65,940 67,288 58,816 8,472 14.4% 1,349 2.0% Revenue growth driven by ADR, Lounges, GT, and Parking 67 Non-Aeronautical Business YE Fav (UnFav) Incr (Decr) 2019 Forecast to 2018 Actuals 2017 2018 2019 2019 Budget Variance Change from 2018 Revenue $ in 000's Actual Actual Forecast Budget $ % $ % Rental Car fewer transactions offset by Non-Aero Revenues higher average ticket price results in nearly Rental Cars - Operations 35,051 37,306 36,913 36,455 459 1.3% (393) -1.1% flat Concession Revenue. Slight decline in Rental Cars - Operating CFC 10,641 16,263 14,374 13,624 749 5.5% (1,889) -11.6% Transaction Days and higher debt service in Public Parking 75,106 80,212 86,070 82,350 3,720 4.5% 5,859 7.3% 2019 drive lower CFC Operating Revenue Ground Transportation 15,684 18,772 20,706 19,734 972 4.9% 1,934 10.3% compared to PY. Airport Dining & Retail 54,611 59,021 59,962 59,484 478 0.8% 941 1.6% Parking demand driven growth Non-Airline Terminal Leased Space 4,369 5,302 5,879 4,909 970 19.8% 577 10.9% GT driven by TNC revenue growth, partially offset by decline in demand for taxis Commercial Properties 18,042 15,434 15,471 14,219 1,251 8.8% 37 0.2% Airport Dining & Retail strong performance Utilities 7,018 7,206 8,026 8,058 (32) -0.4% 820 11.4% continues during lease transitions, and Employee Parking 9,617 10,269 10,134 10,134 - 0.0% (135) -1.3% increased Concession revenue from AlClear Clubs and Lounges 5,041 6,802 10,329 8,520 1,809 21.2% 3,527 51.9% memberships Other 1,624 1,119 2,150 2,049 101 4.9% 1,030 92.1% Clubs demand driven growth by Priority Total Non-Aero Revenues 236,803 257,707 270,014 259,537 10,477 4.0% 12,307 4.8% Pass sales and turn-aways from Alaska lounge. Total Non-Aero Expenses 103,702 107,748 120,832 123,003 2,171 1.8% 13,085 12.1% All other Non-Aero revenue showing steady Net Operating Income 133,101 149,959 149,181 136,534 12,648 9.3% (778) -0.5% growth Less: CFC (Surplus) / Deficit (1) (2,750) (6,157) (4,683) (3,993) (689) -17.3% 1,474 23.9% Expenses - Adjusted Non-Aero NOI 130,351 143,802 144,499 132,540 11,958 9.0% 696 0.5% Planned spending in line with 2019 Budget Debt Service (1) (44,495) (44,545) (49,459) (49,352) (107) -0.2% (4,914) -11.0% initiatives Net Cash Flow 85,856 99,257 95,040 83,188 11,852 14.2% (4,217) -4.2% NOI favorable to Budget, but lower compared to 2018 68 Public Parking Performance YTD Public Parking - Revenue Detail Fav (UnFav) Incr (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 Key message: $ in 000's Actual Actual Actual Budget $ % $ % Parking revenue growth Parking Garage Revenue to Port Gross Sales - Parking Garage 39,974 42,623 43,153 44,442 (1,289) -2.9% 530 1.2% YOY driven by higher less - WA Sales Tax (3,350) (3,565) (3,620) (3,705) 85 -2.3% (55) 1.6% enplanements and tariff less - SeaTac Parking Tax (3,123) (3,411) (3,333) (3,691) 358 -9.7% 79 -2.3% General Parking/Terminal Direct 33,502 35,647 36,200 34,196 2,004 5.9% 553 1.6% increase for parking Prebooking - - - 2,850 (2,850) -100.0% - N/A programs (Premier Revenue to Port - General Parking 33,502 35,647 36,200 37,046 (846) -2.3% 553 1.6% Other Garage Revenue Corporate and Passport Premier Corporate Parking 468 593 697 616 80 13.1% 103 17.4% Parking) implemented Passport Parking Program 1,459 1,532 1,751 1,645 106 6.4% 219 14.3% mid-2018, partially offset Total Parking Garage Revenue 35,428 37,772 38,648 39,307 (660) -1.7% 875 2.3% by lack of a coupon Other Parking Revenue Concession Rent - Doug Fox off-site parking 1,518 1,613 1,723 1,652 71 4.3% 109 6.8% program resulting in less All Other Parking Revenue 12 16 31 9 21 226.2% 15 89.2% transactions. Total Parking Revenue 36,958 39,402 40,401 40,969 (568) -1.4% 999 2.5% Parking Transactions by duration Fav / (UnFav) Incr / (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 in 000's Actual Actual Actual Budget # % # % Total Enplanements 11,008 11,688 12,079 11,930 149 1.2% 391 3.3% O&D % 70.4% 71.2% 71.2% 70.3% 0.9% 1.3% 0.0% 0.0% O&D Enplanements 7,750 8,322 8,600 8,387 214 2.5% 279 3.3% Revenue per O&D Enplanement Metrics Public Parking $ 4.32 $ 4.28 $ 4.21 $ 4.42 $ (0.21) -4.7% $ (0.07) -1.7% Premier Corporate Parking $ 0.06 $ 0.07 $ 0.08 $ 0.07 $ 0.01 10.3% $ 0.01 13.6% Passport Parking Program $ 0.19 $ 0.18 $ 0.20 $ 0.20 $ 0.01 3.8% $ 0.02 10.6% Total Garage Revenue per O&D Enplanement $ 4.57 $ 4.54 $ 4.49 $ 4.69 $ (0.19) -4.1% $ (0.05) -1.0% Concession Rent - Doug Fox off-site parking $ 0.20 $ 0.19 $ 0.20 $ 0.20 $ 0.00 1.7% $ 0.01 3.3% All Other Parking Revenue $ 0.00 $ 0.00 $ 0.00 $ 0.00 $ 0.00 218.1% $ 0.00 83.1% Total Parking per O&D Enplanement $ 4.77 $ 4.73 $ 4.70 $ 4.88 $ (0.19) -3.8% $ (0.04) -0.8% YOY growth in reflects tariff increases and customer demand for close-in parking 69 Public Parking Performance YE Public Parking - Revenue Detail Fav / (UnFav) Incr / (Decr) Key message: 2017 2018 2019 2019 Budget Variance Change from 2018 Parking revenue growth primarily $ in 000's Actual Actual Forecast Budget $ % $ % driven by higher enplanements Parking Garage Revenue to Port forecast and a price increase to Gross Sales - Parking Garage 81,404 86,971 93,644 89,838 3,806 4.2% 6,673 7.7% General Parking beginning in July. less - WA Sales Tax (6,818) (7,247) (7,801) (7,455) (346) 4.6% (554) 7.6% less - SeaTac Parking Tax (6,563) (7,251) (7,829) (7,829) - 0.0% (578) 8.0% General Parking/Terminal Direct 68,981 72,473 78,014 69,054 8,960 13.0% 5,541 7.6% 2019 Forecast vs. 2018 Actuals Prebooking - - - 5,500 (5,500) -100.0% - 100% Revenue - Forecasted increase in Revenue to Port - Public Parking 68,024 72,473 78,014 74,554 3,460 4.6% 5,541 7.6% Public Parking compared to prior Other Garage Revenue Programs year, primarily due to higher Premier Corporate Parking 958 1,225 1,324 1,247 77 6.2% 99 8.1% enplanements and due to 2nd tariff Passport Parking Program 2,977 3,219 3,477 3,330 147 4.4% 258 8.0% rate increase for General Parking Revenue to Port - Parking Programs 3,934 4,444 4,801 4,578 224 4.9% 357 8.0% effective 7/1/2019. Total Parking Garage Revenue 71,958 76,917 82,815 79,132 3,684 4.7% 5,898 7.7% There was also a tariff increase in Other Parking Revenue 2018, which was effective on Concession Rent - Doug Fox off-site parking 3,109 3,238 3,200 3,200 - 0.0% (38) -1.2% 7/1/2018 and impacted both Space Rent and Other Parking Revenue 25 56 55 19 36 190.1% (1) -1.8% General Parking and parking programs within the garage Total Parking Revenue 75,093 80,212 86,070 82,350 3,720 4.5% 5,859 7.3% (Premier Corporate and Passport Total Enplanements 23,416 24,894 25,890 25,394 496 2.0% 996 4.0% Parking). O&D % 70.4% 71.2% 71.2% 70.3% 0.9% 1.3% 0.0% 0.0% O&D Enplanements 16,461 17,725 18,434 17,852 582 3.3% 709 4.0% Revenue per O&D Enplanement Metrics Public Parking $ 4.13 $ 4.09 $ 4.23 $ 4.18 $ 0.06 1.3% $ 0.14 3.5% Premier Corporate Parking $ 0.06 $ 0.07 $ 0.07 $ 0.07 $ 0.00 2.8% $ 0.00 3.9% Passport Parking Program $ 0.18 $ 0.18 $ 0.19 $ 0.19 $ 0.00 1.1% $ 0.01 3.9% Total Garage Revenue per O&D Enplanement $ 4.37 $ 4.34 $ 4.49 $ 4.43 $ 0.06 1.4% $ 0.15 3.5% Strong enplanements growth and tariff rate increases driving parking revenue growth 70 Rental Car Performance YTD Rental Car - Revenue Detail Fav / (UnFav) Incr / (Decr) Key message: 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % Rental Car revenue continues to Total Enplanements 11,008 11,688 12,079 11,930 149 1.2% 391 3.3% be impacted by availability of O&D % 70.4% 71.2% 71.2% 70.3% 0.9% 1.3% 0.0% 0.0% other transportation alternatives O&D Enplanements 7,750 8,322 8,600 8,387 214 2.5% 279 3.3% (light rail, TNCs, car-sharing, Gross Sales by Operators 127,258 134,434 134,334 132,299 2,035 1.5% (100) -0.1% etc.). Transactions per O&D Total Transactions 648 657 647 652 (5) -0.7% (10) -1.5% enplaned passenger declining Average Ticket $196.27 $204.48 $207.53 $202.91 $4.62 2.3% $3.06 1.5% faster than overall enplanement Average Length of Stay 4.13 4.16 4.27 4.19 0.07 1.8% 0.11 0.03 growth. Transactions/O&D Enplanements 8.37% 7.90% 7.53% 7.77% -0.25% -3.2% -0.37% -4.7% CFC Revenue Summary Total Transaction Days 2,677 2,734 2,761 2,733 28 1.0% 27 1.0% CFC Rate per Transaction Day $6.00 $6.00 $6.00 $6.00 $0.00 0.0% $0.00 0.0% CFC Revenue Earned 16,062 16,406 16,567 16,398 169 1.0% 161 1.0% Other CFC Collections 372 93 (373) - (373) N/A (466) -502.1% Total CFC Revenue 16,434 16,499 16,194 16,398 (204) -1.2% (305) -1.8% Debt Service Reserve Requirement (13,150) (11,001) (11,689) (11,741) 52 -0.4% (688) 6.3% Residual - CFC Operating Revenue 3,284 5,497 4,505 4,657 (153) -3.3% (993) -18.1% Rental Car - Revenue Summary Fav / (UnFav) Incr / (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % RCF Concession Revenue to Port 12,673 13,025 13,632 13,229 403 3.0% 608 4.7% Residual - CFC Operating Revenue: 3,284 5,497 4,505 4,657 (153) -3.3% (993) -18.1% Land Rent/Space Rent/Other 1,841 1,898 1,927 1,894 33 1.7% 30 1.6% Total Rental Cars Operating Revenue 17,798 20,420 20,064 19,780 284 1.4% (355) -1.7% Reduced transactions per O&D enplaned passenger 71 Rental Car Performance YE Rental Car - Revenue Detail Fav / (UnFav) Incr / (Decr) Key message: 2016 2017 2018 2019 2019 Budget Variance Change from 2018 Rental Car revenue continues to be impacted by # and $ in 000's Actual Actual Actual Forecast Budget $ % $ % availability of other transportation alternatives (light rail, RCF Concession Revenue to Port 33,465 31,352 33,474 33,125 32,666 459 1.4% (348) -1.0% TNCs, car-sharing, etc.) Total Enplanements 22,796 23,416 24,894 25,890 25,394 496 2.0% 996 4.0% O&D % 69.5% 70.4% 71.2% 71.2% 70.3% 0.9% 1.3% 0.0% 0.0% 2019 Forecast vs. 2018 Actuals O&D Enplanements 15,843 16,485 17,725 18,434 17,852 582 3.3% 709 4.0% Rental Car Concession revenue - Forecast relatively flat Gross Sales by Operators 310,987 313,654 334,355 331,254 326,665 4,589 1.4% (3,101) -0.9% to prior year. Concession Revenue is impacted by (3) key Total Transactions 1,411 1,388 1,416 1,386 1,396 (10) -0.7% (30) -2.1% indicators: Average Ticket $220.42 $226.03 $ 236.08 $239.00 $234.00 5.00 2.1% $2.92 1.2% Average Length of Stay 4.34 4.37 4.44 4.54 4.43 0.11 2.5% 0.10 2.3% Expected continuation of decline in Transactions per Transactions/O&D Enplanements 8.91% 8.42% 7.99% 7.52% 7.82% -0.30% -3.8% -0.47% -5.9% O&D Enplanement reflects trend in passenger preference shifting to other transportation options, CFC Revenue Summary most notable in short-term (1-day) rentals Total Transaction Days 6,129 6,070 6,286 6,292 6,184 108 1.7% 6 0.1% CFC Rate per Transaction Day $6.00 $6.00 $6.00 $6.00 $6.00 $0.00 0.0% $0.00 0.0% Average length of stay is increasing as 1-day rentals CFC Revenue Earned 36,771 36,421 37,716 37,752 37,106 646 1.7% 36 0.1% have declined significantly, due to shift in customer Other CFC Collections 66 (160) 584 - - - N/A (584) -100.0% preference to other transportation alternatives. Total CFC Revenue Earned 36,837 36,261 38,300 37,752 37,106 646 1.7% (548) -1.4% Average ticket price is a function of rental car pricing Reserve for debt service and CP interest: (21,715) (22,621) (21,802) (23,482) (23,482) - 0.0% (1,680) 7.7% and customer demand, and can vary significantly. The Reserve for CP principal payment: (3,000) (3,000) - - - - NA - NA 2019 Budget and the 2019 Forecast assumes an Debt Service Reserve Requirement (24,715) (25,621) (21,802) (23,378) (23,482) 103 -0.4% (1,577) 7.2% average ticket price higher than 2018 actuals due to Residual - CFC Operating Revenue: 12,122 10,641 16,499 14,374 13,624 749 5.5% (2,125) -12.9% the continued erosion of short -term rentals to other transportation modes. This metric will be monitored Rental Car - Revenue Summary Fav / (UnFav) Incr / (Decr) and adjusted in future forecast updates, as needed 2017 2017 2018 2019 2019 Budget Variance Change from 2018 # and $ in 000's Actual Actual Actual Forecast Budget $ % $ % CFC Operating Revenue - Forecasted to decline YOY due to combined impact of decline in Transaction Days and RCF Concession Revenue to Port 33,465 31,352 33,474 33,125 32,666 459 1.4% (348) -1.0% Residual - CFC Operating Revenue: 12,122 10,641 16,499 14,374 13,624 749 5.5% (2,125) -12.9% increase in debt service compared to prior year Land Rent/Space Rent/Other 3,617 3,699 3,597 3,788 3,788 - 0.0% 191 5.3% Total Rental Cars Oper Revenue 49,203 45,691 53,569 51,287 50,079 1,208 2.4% (2,282) -4.3% Reduced transactions per O&D enplaned passenger 72 Ground Transportation YTD Revenue to Port Fav (UnFav) Incr (Decr) Key message: 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 Significant changes in customer $ in 000's Actual Actual Actual Budget $ % $ % preferred ground transportation Ground Transportation Revenues alternatives are reflected in both Transportation Network Companies 3,181 4,749 5,997 5,304 693 13.1% 1,248 26.3% revenue and trip activity between On Demand Taxis 2,631 2,160 1,856 2,088 (232) -11.1% (303) -14.0% GT operator categories. On Demand Limos 405 403 403 401 2 0.5% 0 0.1% Belled In Taxis (Annual Permit) 43 33 27 31 (4) -14.0% (6) -18.7% Growth in TNC activity continues to Pre-Arranged Limos (Annual Permit) 360 361 350 343 6 1.8% (11) -3.1% outpace the offsetting decline in Courtesy Cars (cost recovery) 687 798 986 955 31 3.2% 187 23.5% all other GT operator categories All other Operators (cost recovery) 203 172 208 183 25 13.6% 36 21.0% combined, which results in an Other Misc Revenues 123 210 153 107 46 43.4% (57) -27.0% overall increase in trip activity of Total GT Revenue 7,633 8,885 9,979 9,413 567 6.0% 1,094 12.3% 10.0% YTD Trip Activity Fav / (UnFav) Incr / (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 in 000's Actual Actual Actual Budget # % # % Ground Transportation Trips Transportation Network Companies 573 784 999 964 35 3.7% 216 27.5% On Demand Taxis 375 363 309 348 (39) -11.1% (53) -14.7% On Demand Limos 36 35 34 34 0 0.6% (1) -2.3% Belled In Taxis (Annual Permit) 37 9 8 12 (4) -35.7% (2) -18.4% Pre-Arranged Limos (Annual Permit) 165 168 165 168 (3) -1.8% (3) -1.8% Courtesy Cars (cost recovery) 587 580 594 579 15 2.7% 14 2.4% All other Operators (cost recovery) 40 30 55 28 26 92.9% 25 84.6% Total GT Trip Activity 1,813 1,969 2,165 2,133 32 1.5% 196 10.0% TNC growth expected to continue to outpace enplanement growth 73 Ground Transportation YE Revenue to Port Fav / (UnFav) Incr / (Decr) Key message: 2015 2016 2017 2018 2019 2019 Budget Variance Change from 2018 Significant changes in customer preferred ground $ in 000's Actual Actual Actual Actual Forecast Budget $ % $ % transportation alternatives are reflected in both revenue and trip activity between GT operator categories. Ground Transportation Revenues Transportation Network Companies - 3,222 6,940 10,349 12,864 11,574 1,290 11.1% 2,515 24.3% 2019 Forecast vs. 2018 Actuals On Demand Taxis 4,517 5,045 5,199 4,475 3,690 4,176 (486) -11.6% (785) -17.5% GT Revenue forecast compared to prior year: On Demand Limos 869 869 858 853 842 842 - 0.0% (11) -1.2% TNC revenue forecast in 2019 reflects continued shift Belled In Taxis (Annual Permit) 132 159 45 35 29 33 (4) -12.1% (6) -17.1% in customer preference, and is expected to grow ~24% Pre-Arranged Limos (Annual Permit) 363 496 626 635 588 588 - 0.0% (47) -7.4% YOY Courtesy Cars (cost recovery) 2,195 2,039 1,319 1,660 2,020 1,919 101 5.3% 360 21.7% Taxi revenue forecasted to decline ~18% YOY All other Operators (cost recovery) 511 696 394 340 459 388 71 18.3% 119 34.9% Minor differences between YOY revenue growth % and YOY trip volume growth % are due to incidental billing Other Misc Revenues 223 278 303 424 214 214 - 0.0% (210) -49.6% adjustments. Total GT Revenue 12,803 12,803 15,684 18,772 20,706 19,734 972 4.9% 1,934 10.3% Trip Activity Fav / (UnFav) Incr / (Decr) GT Trip Activity forecast compared to prior year: 2015 2016 2017 2018 2019 2019 Budget Variance Change from 2018 TNC trip volume expected to continue to grow significantly faster than the growth in enplaned in 000's Actual Actual Actual Actual Forecast Budget # % # % passengers. 2019 Forecast expects a 25% YOY Ground Transportation Trips increase in TNC trip volume. Transportation Network Companies - 602 1,277 1,715 2,144 1,929 215 11.1% 429 25.0% Taxi trips activity continues to continue to decline. On Demand Taxis 924 827 750 723 615 696 (81) -11.6% (108) -15.0% 2019 Forecast expects a 15% YOY reduction in taxi trip On Demand Limos 82 74 72 69 67 67 - 0.0% (2) -2.8% volume Belled In Taxis (Annual Permit) 142 195 56 18 14 18 (4) -22.5% (5) -24.9% Small growth in other operators driven by enplanements and offset by lower transactions per Pre-Arranged Limos (Annual Permit) 334 369 337 347 344 344 - 0.0% (3) -1.0% O&D enplanements. Shared-Ride Van growth driven by Courtesy Cars (cost recovery) 1,230 1,218 1,198 1,209 1,224 1,160 64 5.6% 16 1.3% better AVI tracking. All other Operators (cost recovery) 103 95 79 63 76 57 19 33.7% 13 21.0% Total GT Trip Activity 2,816 3,381 3,769 4,145 4,484 4,271 214 5.0% 339 8.2% TNC growth expected to continue to outpace enplanement growth 74 Airport Dining & Retail YTD Fav / (Unfav) Budget Incr / (Decr) from 2019 Forecast vs. 2018 Actuals Airport Dining & Retail 2017 YTD 2018YTD 2019 Year-to-Date Variance 2018 Org Basis (in 000's) Actual Actual Actual Budget $ % $ % Food & Beverage Strong sales in all new units in Central ADR Revenue Terminal and North Satellite. Food & Beverage 10,453 10,626 12,266 11,460 806 7.0% 1,640 15.4% Continuing operations near Central Terminal still beating Retail 6,213 7,819 7,717 7,125 592 8.3% (102) -1.3% sales expectations even after re- Duty Free 3,518 3,742 3,263 3,472 (210) -6.0% (479) -12.8% opening of Central Terminal Concourse Personal Services 1,869 1,830 1,982 1,818 163 9.0% 152 8.3% Retail SalesConvenience Retail Advertising 3,412 2,920 3,502 3,290 212 6.4% 582 19.9% strong YTD sales with help from Space Rental - Terminal 664 681 660 693 (34) -4.8% (21) -3.1% hardstands and temporary operations All other revenue 219 77 193 340 (147) -43.2% 116 151.6% Total ADR Revenue 26,349 27,694 29,581 28,199 1,383 4.9% 1,887 6.8% Personal Services Machine vending revenues (Sodexo) favorable as more machine vending options having been Sales per Enplanement made available across all SPE - Food & Beverage $7.36 $7.17 $7.61 $7.30 $ 0.31 4.3% $ 0.44 6.2% terminals SPE - Retail Sales $3.99 $4.34 $4.04 $3.88 $ 0.16 4.0% $ (0.30) -6.9% SPE - Duty Free $0.92 $0.89 $0.77 $0.90 $ (0.13) -14.3% $ (0.12) -13.6% Duty Free- Sales lagging due to increased Chinese enforcement SPE - Personal Services $0.99 $0.95 $0.85 $0.89 $ (0.03) -3.9% $ (0.10) -10.2% of existing tariffs SPE - Airport Dining & Retail $13.25 $13.35 $13.27 $12.97 $0.30 2.3% ($0.07) -0.6% Strong First half driven by Central Terminal and North Satellite Concessions 75 Airport Dining & Retail YE Fav / (Unfav) Budget Incr / (Decr) 2019 Forecast vs. 2018 Actuals Airport Dining & Retail 2017 2018 2019 2019 Variance Change from 2018 Org Basis (in 000's) Actual Actual Forecast Budget $ % $ % Food & Beverage YOY growth tracking with enplanements and ADR Revenue strong performance by new Food & Beverage 21,579 23,132 23,917 23,780 137 0.6% 785 3.4% Central Terminal and NSAT concessions, despite upcoming Retail 13,989 17,005 17,268 15,445 1,823 11.8% 263 1.5% closures and delayed openings for Capitol Hill Food Hall and Duty Free 6,912 7,026 6,290 7,497 (1,207) -16.1% (736) -10.5% Village Pub Personal Services 3,728 3,951 3,744 3,785 (41) -1.1% (207) -5.3% Retail Sales YOY growth moderate due to prior year sales Advertising 6,662 6,432 6,896 6,896 - 0.0% 464 7.2% peak from supplemental sales in "grab'n'go" food during Space Rental - Terminal 1,292 1,351 1,320 1,385 (64) -4.6% (31) -2.3% restaurant closures. Steady All other revenue 449 125 432 697 (266) -38.1% 307 246.3% growth is expected to continue. Total Airport Dining & Retail Revenue 54,611 59,022 59,866 59,484 382 0.6% 845 1.4% Duty Free continued decline in DF sales attributed to Sales per Enplanement Chinese enforcement of tariffs and SEA inability to offer SPE - Food & Beverage $7.18 $7.34 $7.32 $7.30 $0.03 0.3% ($0.02) -0.2% premium goods due to existing SPE - Retail Sales $4.07 $4.38 $4.01 $3.88 $0.13 3.4% ($0.37) -8.4% space and placement limitations. SPE - Duty Free $0.91 $0.83 $0.75 $0.90 ($0.14) -16.1% ($0.08) -9.6% SPE - Personal Services $0.95 $0.94 $0.88 $0.89 ($0.01) -0.9% ($0.07) -6.9% SPE - Airport Dining & Retail $13.12 $13.50 $12.97 $12.97 $0.00 0.0% ($0.53) -3.9% Strong year over year performance despite lagging Duty Free program 76 Commercial Properties YTD Fav / (Unfav) Incr / (Decr) Key messages: 2019 Budget from Non-Aero Commercial Properties 2017 YTD 2018 YTD 2019 Year to Date Variance 2018 Actuals In-Flight Meal Revenue Subclass Basis (in 000's) Actual Actual Actuals Budget $ % $ % growth continues to outpace the growth in Revenue Source enplanements. NEW DEVELOPMENT PARCELS Non-Aero commercial DMCBP Land Rents - all (3) phases 314 772 789 787 2 0.3% 17 2.2% real estate portfolio now stable, as DMCBP In Lieu - 7yr repayment schedule (Phase I & III) 147 218 256 256 - 0.0% 38 17.4% construction is DMCBP In Lieu - lump sum payment (Phase II) 5,434 - - - - - complete on most new Subtotal DMCBP: 5,895 990 1,045 1,042 2 0.2% 55 5.5% development properties and NERA 2 Land Rent - 47 134 134 0 0.0% 88 187.7% occupancy is stable on NERA 3 Land Rent - 127 367 367 0 0.0% 240 189.1% existing properties. Des Moines Creek North Land Rent - - 169 169 0 0.0% 169 100% NERA grant program Subtotal New Development revenue: 5,895 1,164 1,715 1,713 2 0.1% 551 47.4% ended in mid-2018 In-Flight Kitchen Revenue 3,596 3,933 4,408 4,028 380 9.4% 475 12.1% Burien NERA 3 FAA Pilot Program grant 162 1,276 - - - (1,276) -100.0% All Other Commercial Properties Revenue 1,055 1,220 949 962 (13) -1.3% (271) -22.2% Non-Aero Commercial Properties Revenue: 10,708 7,593 7,072 6,703 369 5.5% (521) -6.9% Strong in flight meal revenues driving positive performance 77 Commercial Properties YE Fav / (Unfav) Incr / (Decr) from Key message: Non-Aero Commercial Properties 2017 2018 2019 2019 2019 Budget 2018 Actuals In-Flight Meal Revenue Subclass Basis (in 000's) Actual Actual Forecast Budget $ % $ % growth continues to Revenue Source outpace the growth in NEW DEVELOPMENT PARCELS enplanements. DMCBP Land Rents - all (3) phases 1,079 1,556 1,573 1,573 0 0.0% 17 1.1% Occupancy stable in all DMCBP In Lieu - 7yr repayment schedule (Phase I & III) 445 482 522 522 - 0.0% 40 8.2% other Non-Aero Commercial DMCBP In Lieu - lump sum payment (Phase II) 5,434 - - - - - Properties locations. Subtotal DMCBP: 6,958 2,038 2,095 2,095 0 0.0% 57 2.8% Favorable variance due to NERA 2 Land Rent 15 248 268 268 - 0.0% 20 8.3% one expected mid-year NERA 3 Land Rent 42 687 734 734 - 0.0% 47 6.8% vacancy now delayed until Des Moines Creek North Land Rent - 90 593 593 - 0.0% 503 560.2% later in the year. Subtotal New Development revenue: 7,015 3,063 3,690 3,690 0 0.0% 627 20.5% NERA grant program ended In-Flight Kitchen Revenue 7,827 8,705 9,709 8,634 1,075 12.5% 1,004 11.5% mid-2018 Burien NERA 3 FAA Pilot Program grant 1,402 1,807 - - - (1,807) -100.0% All Other Commercial Properties Revenue 1,798 1,859 2,072 1,896 177 9.3% 213 11.5% Non-Aero Commercial Properties Revenue: 18,042 15,433 15,471 14,219 1,251 8.8% 37 0.2% In-flight meal revenue growth continues to outpace enplanement growth 78 2019 Capital Expenditures $ in 000's 2019 2019 2019 Budget Variance Description YTD Actual Forecast Budget $ % (1) The Design Builder construction in place has lagged behind projections, primarily because of steel fabrication delays and International Arrivals Facility (1) 153,500 338,500 376,548 38,048 10.1% overall manpower shortages. (2) One month lag on construction invoicing is contributing to NS NSAT Renov NSTS Lobbies (2) 64,866 133,086 141,054 7,968 5.6% positive variance. (3) Original estimate assumed traffic management change order Service Tunnel Renewal/Replace (3) 5,083 11,083 15,000 3,917 26.1% was to be implemented which has not yet occurred. Estimate did not account for decrease in spending as work in the main garage SSAT Renovation Project (4) (3,426) (3,426) 100 3,526 3525.9% is completed. (4) Project cancelled. Arc Flash Mitigation (5) 29 189 3,636 3,448 94.8% (5) Design delays have deferred construction start to 2020. Fire Station - Westside (6) 358 958 4,000 3,042 76.0% (6) A change in delivery method from two major works contracts to one contract has resulted in delaying the construction to start in Highline School Insulation (7) 3 6,043 3,300 (2,743) -83.1% Q1 2020. (7) FAA issued a grant, issuance of grant accelerated projected cash Electric Utility SCADA (8) 6 406 2,800 2,394 85.5% flows for the two schools. (8) Project delayed to address design deficiencies and additional Parking Garage Elevators Modernization (9) 157 1,317 3,590 2,273 63.3% scope. (9) Elevator shafts and vestibules are being delayed until 2020 ASL Conversion at Checkpoints (10) 536 1,536 3,400 1,864 54.8% construction season due to design delays and weather windows. (10) Work delays are due to the lack of electrical contracting and PLB Renew & Replace Phase 2 (11) 1,606 4,168 5,834 1,666 28.6% sprinkler damage delays with CP2/CP3. (11) Two bridges are pushed out from 2019 to 2020 due to gate S12 Perimeter Intrusion Detect Sys (12) 26 123 1,775 1,652 93.1% PLB failure. Payments to suppliers are later than forecasted. (12) RFP Took longer than originally anticipated to get off the RCF Pavement Remediation (13) 173 3,573 5,200 1,627 31.3% ground. (13) Original estimate prepared prior to scope revision for fencing All Other 57,206 162,257 201,494 39,237 19.5% that delayed construction two months. Total Spending 280,124 659,813 767,732 107,919 14.1% YTD spending variances primarily due to delayed Capex spending 79 SAMP Overview YTD Summary Fav (Unfav) Inc (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date 2019 Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % SAMP Completion & Transition to Env Review 100 161 99 120 21 17.5% (62) -38.5% Adv Planning IDIQ - Master Plan 0 1,296 1,895 2,325 430 18.5% 599 46.2% Environmental Review - Master Plan 47 0 127 800 672 84.1% 127 N/A SAMP Utilities Master Plan 0 0 540 800 260 32.5% 540 N/A Total SAMP-Related Spending 147 1,457 2,661 4,045 1,383 34.2% 1,204 82.7% Annual Forecast Year-End Projection Fav (Unfav) Inc (Decr) 2017 2018 2019 2019 2019 Budget Variance Change from 2018 $ in 000's Actual Actual Forecast Budget $ % $ % SAMP Completion & Transition to Env Review 1,335 462 300 300 0 0.0% (162) -35.1% Adv Planning IDIQ - Master Plan 1,141 3,905 4,650 4,650 0 0.0% 745 19.1% Environmental Review - Master Plan 169 521 1,250 1,600 350 21.9% 729 139.9% SAMP Utilities Master Plan 276 459 2,000 2,000 0 0.0% 1,541 335.7% Total SAMP-Related Spending 2,921 5,347 8,200 8,550 350 4.1% 2,853 53.4% YTD timing delay in Environmental Review and Advanced Planning 80 Maritime Division Appendix Maritime 2019 Financial Summary Fav (UnFav) Incr (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % Ship Canal Fishing & Operations 1,456 1,610 2,004 2,010 (6) 0% 394 24% Elliott Bay Fishing & Commercial Operations 2,984 3,012 3,067 2,961 105 4% 55 2% Recreational Boating 5,438 6,068 6,228 6,358 (131) -2% 160 3% Cruise 6,325 6,806 8,473 9,114 (641) -7% 1,668 25% Bulk 3,042 3,123 2,567 2,423 144 6% (556) -18% Maritime Portfolio Management 5,267 5,628 5,019 5,052 (33) -1% (609) -11% Other 14 11 10 0 10 NA (1) -8% Total Revenue 24,525 26,257 27,368 27,918 (550) -2% 1,110 4% Expenses Ship Canal Fishing & Operations 1,021 1,183 1,227 1,493 266 18% 44 4% Elliott Bay Fishing & Commercial Operations 1,289 1,315 1,202 1,407 205 15% (113) -9% Rec Boating 1,857 1,952 2,027 2,312 285 12% 75 4% Cruise 427 1,136 998 2,307 1,309 57% (138) -12% Other Maritime 221 365 280 270 (11) -4% (85) -23% Maintenance Expenses 4,658 5,576 5,521 6,227 706 11% (55) -1% Portfolio Management 1,770 2,031 2,136 2,402 266 11% 105 5% Other ED Expenses 353 320 232 356 123 35% (87) -27% Total Maritime & EDD expenses 11,595 13,878 13,624 16,773 3,149 19% (254) -2% Enviromental & Sustainability 598 519 1,082 1,294 212 16% 563 108% CDD Expenses 419 437 415 420 5 1% (22) -5% Police Expenses 1,889 2,169 1,988 2,240 252 11% (181) -8% Other Central Services 4,725 4,707 5,055 5,461 406 7% 349 7% Aviation Division 93 105 135 107 (28) -26% 30 28% Total Central Services & Aviation 7,724 7,937 8,675 9,522 847 9% 738 9% Envir Remed Liability 371 (99) 11 0 (11) NA 110 -111% Total Expense 19,690 21,716 22,310 26,295 3,985 15% 594 3% NOI Before Depreciation 4,835 4,541 5,058 1,623 3,435 212% 516 11% Depreciation 8,442 8,823 8,911 8,804 (107) -1% 88 1% NOI After Depreciation (3,606) (4,281) (3,853) (7,181) 3,328 46% 429 10% YTD NOI 11% higher than 2018 82 Maritime 2019 Business Line Financials Page 1 YTD YTD YTD YTD Fav(UnFav) Bud Var Incr/(Decr) Chg fr Prior Year Total Year $ in 000's Actual Actual Actual Budget $ % $ % Budget 2017 2018 2019 2019 2019 Cruise Revenue 6,325 6,806 8,473 9,114 (641) -7.03% 1,667 24.49% 22,406 Expense 3,495 4,712 5,257 6,194 937 15.13% 545 11.57% 12,017 NOI Before Depreciation 2,830 2,094 3,216 2,920 296 10.14% 1,122 53.58% 10,389 Depreciation Expense 2,627 3,201 3,211 2,994 (217) -7.25% 10 0.31% 5,986 NOI After Depreciation 203 (1,107) 5 (74) 79 106.76% 1,112 100.45% 4,403 Rec Boating Revenue 5,438 6,068 6,228 6,358 (130) -2.04% 160 2.64% 12,794 Expense 4,647 5,085 5,183 6,095 912 14.96% 98 1.93% 11,750 NOI Before Depreciation 791 983 1,045 263 782 297.34% 62 6.31% 1,044 Depreciation Expense 1,592 1,459 1,378 1,363 (15) -1.10% (81) -5.55% 2,727 NOI After Depreciation (801) (476) (333) (1,100) 767 69.73% 143 30.04% (1,683) Maritime Portfolio Revenue 5,267 5,628 5,019 5,052 (33) -0.65% (609) -10.82% 10,328 Expense 5,155 5,237 5,454 6,277 823 13.11% 217 4.14% 11,982 NOI Before Depreciation 112 391 (435) (1,225) 790 64.49% (826) -211.25% (1,654) Depreciation Expense 1,335 1,361 1,279 1,249 (30) -2.40% (82) -6.02% 2,502 NOI After Depreciation (1,223) (970) (1,714) (2,474) 760 30.72% (744) -76.70% (4,156) Ship Canal Fishing & Operations Revenue 1,456 1,610 2,004 2,010 (6) -0.30% 394 24.49% 4,021 Expense 2,614 2,758 2,805 3,225 420 14.98% 46 1.68% 6,319 NOI Before Depreciation (1,159) (1,148) (800) (1,215) 414 51.74% 348 30.30% (2,298) Depreciation Expense 830 821 1,089 1,184 96 8.80% 268 32.65% 2,370 NOI After Depreciation (1,989) (1,969) (1,889) (2,399) 510 26.99% 80 4.06% (4,668) 83 Maritime 2019 Business Line Financials Page 2 YTD YTD YTD YTD Fav(UnFav) Bud Var Incr/(Decr) Chg fr Prior Year Total Year $ in 000's Actual Actual Actual Budget $ % $ % Budget 2017 2018 2019 2019 2018 Elliott Bay Fishing & Commercial Operations Revenue 2,984 3,012 3,067 2,961 105 3.44% 55 1.81% 5,927 Expense 2,735 2,999 2,552 3,244 691 27.09% (447) -14.90% 6,195 NOI Before Depreciation 249 13 515 (282) 797 NA 501 3799.04% (269) Depreciation Expense 1,775 1,676 1,671 1,735 64 3.80% (5) -0.27% 3,471 NOI After Depreciation (1,527) (1,663) (1,157) (2,017) 860 74.37% 506 -30.43% (3,739) Bulk/Grain Terminal Revenue 3,042 3,123 2,567 2,423 144 5.94% (556) -17.80% 4,254 Expense 653 874 830 889 59 6.64% (44) -5.03% 1,810 NOI Before Depreciation 2,389 2,249 1,737 1,534 203 13.23% (512) -22.77% 2,444 Depreciation Expense 279 298 275 272 (3) -1.10% (23) -7.72% 543 NOI After Depreciation 2,110 1,951 1,462 1,262 200 15.85% (489) -25.06% 1,901 Other Revenue 14 11 10 0 10 NA (1) -9.09% 0 Expense 391 50 229 372 143 38.44% 179 358.00% 748 NOI Before Depreciation (377) (39) (219) (372) 153 41.13% (180) -461.54% (748) Depreciation Expense 3 7 7 7 0 0.00% 0 NA 14 NOI After Depreciation (380) (46) (226) (379) 153 40.37% (180) -391.30% (762) Total Maritime Revenue 24,525 26,257 27,368 27,918 (550) -1.97% 1,111 4.23% 59,729 Expense 19,690 21,716 22,310 26,295 3,985 15.15% 594 2.74% 50,822 NOI Before Depreciation 4,835 4,541 5,058 1,623 3,435 211.65% 517 11.39% 8,907 Depreciation Expense 8,442 8,823 8,911 8,804 (107) -1.22% 88 1.00% 17,613 NOI After Depreciation (3,607) (4,282) (3,853) (7,181) 3,328 46.34% 429 10.02% (8,706) 84 Maritime Capital 2019 2019 YTD 2019 2019 Budget Variance Small Projects Numerous projects within CIP are $ in 000's Actual Forecast Budget $ % under feasibility discussions to either cancel or defer Small Projects 748 2,717 3,954 1,237 31% spending into 2020. SBM Restrms/Service Bldgs Rep 62 2,721 2,920 199 7% Contingency Renewal & Replace. 0 2,000 2,000 0 0% T117 Restoration Schedule delayed due to delay in MD Fleet 2019 0 1,429 1,818 389 21% Trustee negotiation. Cruise Terminal Tenant Improv 13 1,370 1,370 0 0% T117 Restoration 99 579 1,040 461 44% New Cruise Terminal - A site for the new cruise FT Docs 3,4,5 Fixed Pier 173 637 600 (37) -6% New Cruise Terminal 160 1,060 600 (460) -77% terminal became available sooner than expected. SBM Paving 27 725 596 (129) -22% Design development proceeding earlier than Maritime Technology Projects 26 176 450 274 61% anticipated. Marina Mgt Sys Replacement 63 163 426 263 62% All Other Projects 508 1,528 1,864 336 18% SBM Paving Construction delayed due to re- Total Maritime 1,879 15,105 17,638 2,533 14% evaluation of project scope after bids received 33% over Engineer's estimate. Contract award expected in Q3 2019. Marina Management System Project on hold as Vendor unable to meet security requirements. Schedule delays driving underspend vs. to budget 85 Stormwater Utility Fav (UnFav) Incr (Decr) Total Year 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 Budget $ in 000's Actual Actual Actual Budget $ % $ % Revenue NWSA 1,919 2,097 2,227 2,282 (55) -2% 130 6% 3,995 Tenants Revenue 496 561 617 562 55 10% 57 10% 507 Non-tenants Revenue 56 49 53 53 (0) 0% 4 8% 1,293 Total Revenues 2,471 2,707 2,897 2,897 0 0% 191 7% 5,795 Expenses SWU Direct 263 394 336 510 (174) -34% (58) -15% 1,052 Maintenance Expenses 1,125 1,669 1,525 1,461 63 4% (144) -9% 2,933 EDD Expenses 10 4 17 25 (8) -34% 13 314% 50 Environmental & Sustainability 260 103 180 129 51 40% 77 74% 268 Capital Development Expenses 24 7 14 26 (12) -47% 7 90% 70 Other Central Service Expenses 39 76 90 72 18 26% 14 19% - Total Expenses 1,720 2,253 2,161 2,223 (62) -3% (92) -4% 4,373 NOI Before Depreciation 751 241 500 357 143 40% 259 107% Depreciation 498 548 599 551 49 9% 51 9% 1,108 NOI After Depreciation 253 (307) (99) (194) 94 -49% 208 -68% (1,108) Crews have assessed 80% of the system, rehabilitated 17.4%, completed 19 repairs, and installed 5 tide gates so far in 2019. SWU tracking to budget 86 Economic Development Division Appendix EDD 2019 YTD Financial Detail Fav (UnFav) Incr (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % Revenue 4,182 4,577 4,421 4,414 7 0% (156) -3% Conf & Event Centers 3,545 5,188 5,963 5,604 360 6% 775 15% Total Revenue 7,727 9,765 10,384 10,017 367 4% 619 6% Expenses Portfolio Management 2,050 1,952 1,922 2,156 234 11% (30) -2% Conf & Event Centers 3,660 4,306 4,833 4,687 (146) -3% 526 12% P69 Facilities Expenses 96 114 92 115 23 20% (22) -20% RE Dev & Planning 120 74 48 98 49 51% (26) -35% EconDev Expenses Other 396 473 352 644 292 45% (121) -26% Maintenance Expenses 1,492 1,996 1,563 2,160 597 28% (433) -22% Maritime Expenses (Excl Maint) 24 77 72 196 124 63% (5) -6% Total EDD & Maritime Expenses 7,838 8,992 8,882 10,055 1,174 12% (111) -1% Diversity in Contracting 26 37 99 106 7 7% 62 169% Workforce Development 228 228 474 959 485 51% 246 108% Tourism 514 620 526 761 235 31% (94) -15% EDD Grants 427 28 (4) 580 584 101% (32) -112% Total EDD Initiatives 1,195 912 1,095 2,406 1,311 54% 183 20% Environmental & Sustainability 130 121 173 193 20 10% 52 43% CDD Expenses 200 139 148 120 (28) -23% 9 6% Police Expenses 85 81 101 114 13 12% 20 24% Other Central Services 2,551 2,555 2,520 2,719 199 7% (35) -1% Aviation Division 69 79 54 80 27 33% (26) -32% Total Central Services & Aviation 3,034 2,976 2,995 3,226 231 7% 20 1% Envir Remed Liability 0 0 0 0 0 NA 0 NA Total Expense 12,067 12,880 12,972 15,688 2,716 17% 92 1% NOI Before Depreciation (4,340) (3,115) (2,588) (5,670) 3,082 54% 527 17% Depreciation 1,860 1,999 1,859 1,908 50 3% (141) -7% NOI After Depreciation (6,201) (5,114) (4,447) (7,579) 3,132 41% 668 13% Flat spending YTD over 2018 88 EDD Capital 2019 Tenant Improvements - Capital Leases Budget Variance 2019 YTD 2019 2019 forecasted to expire will be renewed Actual Forecast Budget $ % $ in 000's and require additional capital Tenant Improvements -Capital 0 1,023 1,012 (11) -1% investment. RE: Contingency Renew.&Replace 0 1,000 1,000 0 0% Small Projects 74 499 750 251 33% BHICC Interior Modernization 523 750 750 0 0% Small Projects Upland Garage EV P66 HVAC Systems Upgrade 266 666 690 24 3% Charging Station project was cancelled T91 Upland PreDevelopment 53 203 625 422 68% by project sponsor for 2019. Project P69 Commission Chamber Refresh 258 258 301 43 14% P69 Solar Panel System 266 266 300 34 11% feasibility for 2020 under discussion. EDD Technology Projects 0 170 250 80 32% Fleet Replacement 0 30 30 0 0% T-91 Upland Industrial Spending less Other Projects 4 115 5 (110)0 -2200%NA in 2019 with more spending to occur in Total Economic Development 1,444 4,980 5,713 733 13% 2020 and 2021. Prioritization and project delays 89 Central Services Appendix Central Services Financial Summary Fav (UnFav) Incr (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % Total Operating Revenues 82 81 331 56 275 488.2% 250 308.5% Core Central Support Services 34,692 36,661 37,576 40,544 2,968 7.3% 915 2.5% Police 11,378 13,188 13,997 15,416 1,419 9.2% 809 6.1% Capital Development 7,763 7,733 8,155 9,489 1,334 14.1% 422 5.5% Environment & Sustainability 3,347 2,954 4,551 5,857 1,306 22.3% 1,597 54.1% Total Operating Expenses 57,181 60,536 64,279 71,305 7,026 9.9% 3,743 6.2% Operating expenses were $7.0M favorable to budget in Q2 2019 91 Central Services Expense by Category Fav (UnFav) Incr (Decr) 2017 YTD 2018 YTD 2019 Year-to-Date Budget Variance Change from 2018 $ in 000's Actual Actual Actual Budget $ % $ % Salaries & Benefits 34,654 38,558 40,329 41,669 1,341 3.2% 1,770 4.6% Payroll savings due to Wages & Benefits 10,679 12,360 13,323 14,156 833 5.9% 963 7.8% staff vacancies. Payroll to Capital Projects 11,207 10,897 11,176 13,656 2,480 18.2% 279 2.6% Outside Services Equipment Expense 1,230 1,193 1,005 1,172 168 14.3% (188) -15.8% favorable budget variance are largely Supplies & Stock 493 589 487 617 130 21.1% (102) -17.3% due to lower spending Outside Services 13,311 14,340 15,374 20,586 5,211 25.3% 1,034 7.2% and project delays. Travel & Other Employee Exps 1,188 1,199 1,203 1,969 766 38.9% 4 0.3% Charge to Capital was Insurance Expense 1,167 1,079 1,117 1,150 33 2.9% 38 3.5% lower than budget due Litigated Injuries & Damages 838 (82) - - - 0.0% 82 -100.0% to delay of some Other 1,102 1,036 1,837 1,712 (125) -7.3% 801 77.3% capital projects. Charge to Capital/Overhead Alloc (18,688) (20,633) (21,572) (25,383) (3,811) 15.0% 939 4.6% Total 57,181 60,536 64,279 71,305 7,026 9.9% 3,743 6.2% Most of the budget savings came from payroll and outside services 92 Central Service YE Financial Forecast Fav (UnFav) Incr (Decr) 2017 2018 2019 2019 Budget Variance Change from 2018 $ in 000's Actual Actual Forecast Budget $ % $ % Total Operating Revenues 68 (500) 498 185 313 169.2% 998 -199.5% Core Central Support Services 71,071 73,576 81,157 82,710 1,552 1.9% 7,581 10.3% Police 22,095 23,908 29,578 30,778 1,200 3.9% 5,670 23.7% Capital Development 17,370 15,501 16,227 18,628 2,401 12.9% 726 4.7% Environment & Sustainability 6,975 8,770 12,101 13,224 1,123 8.5% 3,331 38.0% Total Operating Expenses 117,511 121,755 139,064 145,339 6,276 4.3% 17,308 14.2% Expect a $6.3M favorable budget variance for 2019 93 Central Services Capital Spending 2019 YTD 2019 2019 Budget Variance $ in 000's Actual Forecast Budget $ % Infrastructure - Small Cap 433 1,500 1,500 0 0.0% Services Tech - Small Cap 176 600 1,000 400 40.0% PeopleSoft Financials Upgrade 809 1,575 1,575 0 0.0% Radio System Upgrade 1,511 5,311 9,140 3,829 41.9% Police Records Mgmt System 0 300 800 500 62.5% New Budget System 0 500 600 100 16.7% Office Wi-Fi Refresh 0 250 500 250 50.0% Maximo Upgrade 0 30 500 470 94.0% STIA Network Redundancy 0 750 900 150 16.7% Fiber Channel 0 350 600 250 41.7% Phone System Upgrade 0 300 1,400 1,100 78.6% Customer Relationship Mgmt 0 400 0 (400) n/a CDD Fleet Replacement 125 1,149 1,439 290 20.2% Corporate Fleet Replacement 212 212 1,328 1,116 84.0% Other (note 1) 462 1,617 2,086 469 22.5% TOTAL 3,728 14,844 23,368 8,524 36.5% Note: (1) "Other" includes remaining ICT projects and small capital projects/acquisitions. YTD spending variances primarily due to delayed spending 94
Limitations of Translatable Documents
PDF files are created with text and images are placed at an exact position on a page of a fixed size.
Web pages are fluid in nature, and the exact positioning of PDF text creates presentation problems.
PDFs that are full page graphics, or scanned pages are generally unable to be made accessible, In these cases, viewing whatever plain text could be extracted is the only alternative.