PORT OF SEATTLE 
MEMORANDUM 
COMMISSION AGENDA               Item No.      6c 
ACTION ITEM 
Date of Meeting    September 27, 2016 
DATE:    September 19, 2016 
TO:      Ted Fick, Chief Executive Officer 
FROM:   Stephanie Jones Stebbins, Director Marine Stormwater Utility 
Jane Dewell, Maritime Stormwater Program Manager 
SUBJECT:  Approval of an Interlocal Agreement Between the Port and City of Seattle
Regarding the Port's Marine Stormwater Utility 
Amount of This Request:         No funds  Source of Funds: 
requested 
Est. Total Project Cost:        Approx. $4.7
million/year
expended to
rehabilitate Port
stormwater
system 
Net Proceeds to the Port:       Approx. $4.7
million/year 
ACTION REQUESTED 
Request Commission authorization for the Chief Executive Officer to execute an interlocal
agreement (ILA) creating a legal agreement between the City of Seattle and the Port of Seattle
regarding the coexistence of a Port of Seattle Marine Stormwater Utility and a City of Seattle
stormwater utility. 
The Seattle City Council will be considering the ILA during their council meeting on September
26, 2016. 
SYNOPSIS 
In November 2014, the Port of Seattle Commission created a Port of Seattle Stormwater Utility
and activated the Marine portion of that Utility. Creation of the Utility was part of a larger effort
by the Port to independently manage stormwater from real property it owns and to be relieved of
the obligation to pay surface water management fees to the City of Seattle. Port and City of
Seattle staff worked together diligently to develop the details of an interlocal agreement that
would allow both Utilities to best serve the City and Port customers as well as protect the
environment. 

Template revised May 30, 2013.

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
September 19, 2016, 
Page 2 of 6 

The benefits of establishing a Stormwater Utility operated by the Port for Port properties include
the following: 
Establishment of a source of funds that will be used to assess, repair, and rehabilitate the
Port's aging stormwater infrastructure 
Improved water quality of stormwater runoff entering Puget Sound due to infrastructure
rehabilitation 
Support achievement of Century Agenda goal to "Meet or exceed agency requirements
for stormwater leaving Port-owned or operated facilities" 
A 'Terms for Agreement' outlined how the Port would withdraw from the obligation to pay the
City of Seattle surface water management fees and how the City and Port would work
cooperatively on surface water (stormwater) management issues concerning their properties. The
ILA was negotiated in November 2014. Development of the ILA followed a high-level meeting
between Commissioners Gregoire and Bowman and Mayor Murray that occurred on April 11,
2014. 
The Port of Seattle and City of Seattle agreed to negotiate a detailed ILA that would memorialize
and further detail the 'Terms of Agreement,' including the following: 
The Port would stop paying stormwater fees to the City, 
The City would release any and all legal claims against the Port based on the Port's
authority to create an Utility, 
The Port would indemnify the City concerning any jurisdictional challenges related to the
creation of the Utility, 
The Port will pay the City the equivalent of the fees for 2015 (approximately $4 million), 
The parties would document where the City and Port stormwater systems connect, 
The parties would adopt a process for resolving system ownership disputes, 
The parties would agree to a process for code enforcement, 
The parties would agree to a process to address City stormwater flows to Port properties
that have stringent requirements under industrial stormwater permits, and 
The parties would agree to a dispute resolution process. 
Port of Seattle and City of Seattle staff completed work on details of the ILA and exhibits in July
2016. The City of Seattle Council is scheduled to consider this ILA during a September 2016
Seattle City Council meeting. 
BACKGROUND 
The Port of Seattle Commission approved creation of the Stormwater Utility on November 25,
2014 (Port of Seattle Resolution No. 3696, as amended). The need for a Stormwater Utility,
where funds are collected and used by the Port of Seattle, became a priority due to increased
regulatory requirements, increased stringency in water quality permits, and increased costs to the
Port and tenants to comply with more stringent permit requirements. Without a Stormwater
Utility, the Port and tenants would continue to pay drainage fees to the City of Seattle, with fees

Revised March 28, 2016  pjw

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
September 19, 2016, 
Page 3 of 6 
escalating at approximately 10 percent a year ($4 million in 2015). With the creation of a
Stormwater Utility, the drainage fees are collected and used by the Port to invest in assessing and
rehabilitating our  stormwater infrastructure and in supporting other stormwater permit
requirements. 
Between November 2014 and July 2016, technical, legal, and management staff at the Port of
Seattle and City of Seattle Public Utilities conducted research and drafted the documents that
became the ILA and exhibits. These documents define legal and financial responsibilities,
stormwater system connections, and issues to be resolved in the coming years, such as system
easements and improvements. 
During 2015, following the November 2014 adoption of the Stormwater Utility and 'Terms for
Agreement' with City of Seattle, the Port collected stormwater drainage fees and held funds in an
account rather than paying them to the City of Seattle. The drainage fees collected and held in
2015, which are approximately $4 million, will be paid to the City of Seattle once the ILA has
been approved by both agencies. 
Beginning in January 2016, the drainage fees collected from Port properties were used to support
the Utility's work to assess, repair, and develop priorities for rehabilitating the Maritime
properties' stormwater infrastructure. Initial work focused efforts on storm systems at the
container terminals and other highly industrial properties in the Lower Duwamish Watershed.
Conversations were initiated with tenants, business units, and other Port and Northwest Seaport
Alliance staff that benefit from or contribute to the Utility to educate and gather support for this
new organization and the stormwater improvements that will be initiated. 
PROJECT JUSTIFICATION AND DETAILS 
Project Objectives 
The Marine Stormwater Utility will allow the Port to collect drainage fees and invest funds in
rehabilitating stormwater infrastructure. Specific objectives include: 
Assess condition of stormwater lines and related structures 
Identify urgent repairs, and prioritize and complete those repairs 
Identify and characterize longer term capital improvements that could contribute to
system rehabilitation and improved stormwater quality from Port properties 
Scope of Work 
The ILA will formalize the agreement with the City of Seattle regarding the Marine Stormwater
Utility, stormwater system connections, and financial and legal obligations. 
Schedule 
In 2015 and 2016, policies were developed to define and guide Utility work. In 2016, equipment
was purchased to support stormwater system assessment, improvements to some properties were

Revised March 28, 2016  pjw

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
September 19, 2016, 
Page 4 of 6 
initiated that included line repairs and installation of tide gates, and scheduling of system
assessments and some urgent repairs was begun. 
The following goals were developed for Utility stormwater system assessment and rehabilitation: 
Assessment  Rehabilitation
Year      (%)        (%)             Notes 
2016    15        6           Baseline 
2017    30        12 
2019    100       24          Complete assessment 
2020             30 
2025             45 
2030             60 
2035             75          Milestone for Century
Agenda Goal 
FINANCIAL IMPLICATIONS 
Budget Status and Source of Funds 
In 2014, the Port and its tenants paid an estimated $4.1 million to the City of Seattle in
stormwater fees. In 2015, the Port collected approximately $4 million dollars in stormwater fees,
and upon signing the ILA, these fees with be paid to the City of Seattle as part of the agreement.
In 2016, the Port expects to collect $4.7 million dollars in stormwater fees from tenants, business
divisions, and the Northwest Seaport Alliance. In 2017, stormwater utility funds are estimated at
$4.9 million. Under the rules of the Stormwater Utility, and agreement outlined in the ILA, these
funds will be  expended to support assessment and improvements to the Port's maritime
stormwater infrastructure. 
STRATEGIES AND OBJECTIVES 
Environmental benefits of the Marine Stormwater Utility include improving stormwater quality
from Port lands through cleaning, repairing, rehabilitating, and improving the stormwater
infrastructure on Port Maritime properties. 
Implementing the Stormwater Utility supports the following Century Agenda Goals and Green
Port Principles: 
Be the greenest and most energy efficient Port in North America (Century Agenda
Strategy) 
Meet or exceed agency requirements for stormwater leaving Port-owned or operated
facilities (Century Agenda Goal) 
Serve as a model of sustainable growth while enhancing water quality at the Port
(Century Agenda Green Port Principle #1) 

Revised March 28, 2016  pjw

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
September 19, 2016, 
Page 5 of 6 
Allocate funds to those efforts that will yield the greatest environmental and water quality
benefits (Century Agenda Green Port Principle #2) 
Implement stormwater-related policies and programs that enhance the Port's economic
competitiveness (Century Agenda Green Port Principle #4) 
The Marine Stormwater Utility also supports Green Marine objectives pertaining to proper
stormwater management in the categories of Spill Prevention, Dry Bulk Handling and Storage,
and Community Impacts. 
ALTERNATIVES AND IMPLICATIONS CONSIDERED 
Alternative 1  Do not move forward with the Utility and do not sign the ILA 
Cost Implications: No new income to invest in Port stormwater infrastructure, and return funds
to City of Seattle collected by the Utility since 2015. 
Pros: 
(1)  No new work added to the organization regarding assessment and rehabilitation of
stormwater system 
(2)  City of Seattle would be pleased to continue receiving $4-5 million/year in
stormwater fees from the Port Maritime properties 
Cons: 
(1)  The Commission would be backing out of the 2014 agreement with the City of
Seattle 
(2)  No funds to invest in Port stormwater infrastructure 
(3)  Reduce likelihood of meeting Century Agenda goal to 'Meet or exceed agency
requirements for stormwater leaving Port-owned or operated facilities' 
This is not the recommended alternative. 
Alternative 2  Move forward with the Utility but do not sign the ILA 
Cost Implications: Collect Utility income of approximately $4.7 million (2016) and $4.9 million
(2017), and retain funds collected by the Utility in 2015 (do not pay to City). 
Pros: 
(1) Receive Utility funds that can be invested in assessing and rehabilitating Port
stormwater infrastructure 
(2) Improve likelihood of meeting Century Agenda goal to 'Meet or exceed agency
requirements for stormwater leaving Port-owned or operated facilities' 
Cons: 
(1) The Commission would be backing out of the 2014 agreement with the City of Seattle 
(2) New work added to the organization to assess and address stormwater system
improvements 
This is not the recommended alternative. 

Revised March 28, 2016  pjw

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
September 19, 2016, 
Page 6 of 6 

Alternative 3  Continue to implement the Utility and sign the ILA with City of Seattle 
Cost Implications: Collect Utility income of approximately $4.7 million (2016) and $4.9 million
(2017), and pay City of Seattle $4 million collected in 2015. 
Pros: 
(1)  Complete the process of formalizing a Stormwater Utility that began in 2014 
(2)  Receive Utility funds that can be invested in assessing and rehabilitating Port
stormwater infrastructure 
(3)  Improve likelihood of meeting Century Agenda goal to 'Meet or exceed agency
requirements for stormwater leaving Port-owned or operated facilities' 
(4)  Resolve any legal ambiguities concerning the Port's future obligations to pay
surface water management fees to the City 
Cons: 
(1)  New work added to the organization to assess and address stormwater system
improvements 
This is the recommended alternative. 
ATTACHMENTS TO THIS REQUEST 
Computer slide presentation 
Port of Seattle-City of Seattle Interlocal Agreement Regarding Stormwater Utility
Operations, Seattle Public Utilities Agreement Number 15-083A 
Exhibit A: List of Port Parcels Removed from SPU Drainage Billing 
Exhibit B: City-Port of Seattle Drainage System Connection Table 
Exhibit C: Stormwater Infrastructure Ownership Resolution and SPU Easements
Needed from the Port of Seattle 
Exhibit D: Example Connection Agreement 
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS 
June 3, 2014  Stormwater Overview & Issues Briefing, Staff Briefing Item No. 7a 
September 11, 2014  First Reading of Resolution No. 3696, Authorizing Stormwater
Utility Formation, Action Item No. 6f 
November 25, 2014   Second Reading of Resolution No. 3696, as amended,
Authorizing Stormwater Utility Formation, Action Item No. 6d 



Revised March 28, 2016  pjw