6a supp
ITEM NO. 6a_Supp________ DATE OF MEETING: Nov 5, 2013_____ Port of Seattle 2014 Preliminary Operating First Reading/Public Hearing November 5, 2013 Agenda Budget Process Recap Preliminary Operating Budget Preliminary Comprehensive Op & Non-Op Budget Proposed Capital Budget FTEs Summary Sources and Uses of Funds Tax Levy Proposed Budget Changes Remaining Schedule 2 2014 Budget Process Jul. 23 Budget Retreat/Process Briefing Aug. 20 Budget Assumptions Briefing Aug. 20 Business Plan and Capital Plan Briefing Oct. 1 Capital Budget Briefing Oct. 8 Preliminary Operating Budget Briefing Oct. 22 Tax Levy and Draft Plan of Finance Briefing Oct. 22 Provide Preliminary Budget Document to the Commission Oct. 24 Release Preliminary Budget to the Public Nov. 5 First Reading & Public Hearing of the Preliminary Budget Nov. 19 Second Reading & Final Passage of the Preliminary Budget Dec. 2 Statutory Budget Filed with King County Dec. 13 Release the Final Budget and Draft Plan of Finance 3 2014 Preliminary Budget 2012 2013 2013 2014 Budget Change ($ in '000s) Actual Budget Forecast Budget $ % Operating Revenues Aeronautical 233,000 249,799 254,314 241,938 -7,861 -3.1% SLOA III Incentive Adj. - - - -3,576 -3,576 n/a Non-Aeronautical 153,022 157,826 160,928 164,410 6,584 4.2% Aviation 386,022 407,625 415,242 402,772 -4,853 -1.2% Seaport 103,941 110,283 97,575 102,425 -7,858 -7.1% Real Estate 31,308 32,516 30,353 31,376 -1,140 -3.5% CDD 32 - 23 - - n/a Corporate 403 155 300 155 0.0% Other Operating Revenues 135,684 142,954 128,251 133,956 -8,998 -6.3% Total 521,706 550,579 543,493 536,728 -13,851 -2.5% Operating Expenses Aviation 156,004 176,291 171,329 163,497 -12,794 -7.3% Seaport 19,366 20,498 19,179 22,883 2,385 11.6% Real Estate 35,559 38,536 35,037 39,312 776 2.0% CDD 13,978 14,780 15,449 16,532 1,752 11.9% Corporate 73,263 78,807 75,807 79,997 1,190 1.5% Total 298,169 328,912 316,800 322,221 -6,691 -2.0% Net Operating Income 223,537 221,668 226,693 214,507 -7,161 -3.2% 4 Comprehensive Budget Summary 2012 2013 2014 Budget Change ($ in '000s) Actual Budget Budget $ % Explanations Revenues 1. Aeronautical Revenues 233,000 249,799 238,362 (11,437) -4.6% Cost recovery under SLOA III 2. Other Operating Revenues 288,706 300,780 298,366 (2,414) -0.8% Lower revenues from Seaport and RE 3. Tax Levy 72,678 73,000 73,000 - 0.0% Assume no change from 2013 4. PFCs 62,385 64,844 67,352 2,508 3.9% Increase in enplanements 5. CFC Revenue for Debt Service 20,577 20,553 20,568 15 0.1% 6. Fuel Hydrant 8,123 7,839 6,953 (885) -11.3% Bond refunding 7. Non-Capital Grants and Donations 3,349 1,909 7,968 6,059 317.4% Grants for Clean Air initiative 8. Capital Contributions 30,714 17,068 10,393 (6,676) -39.1% Less LOI for 3rd runway from FAA 9. Interest Income 8,172 7,296 7,615 319 4.4% Higher General and ADF fund balance Total 727,704 743,088 730,576 (12,512) -1.7% Expenses 1. O&M Expense 298,169 328,912 322,221 (6,691) -2.0% No terminal realignment expenses 2. Depreciation 167,279 171,510 164,386 (7,124) -4.2% Some fully depreciated assets at the Airport 3. Revenue Bond Interest Expense 122,170 129,314 128,987 (327) -0.3% 4. GO Bond Interest Expense 14,447 13,291 9,806 (3,485) -26.2% Refunding of bonds 5. PFC Bond Interest Expense 6,778 6,367 5,953 (414) -6.5% 6. Non-Op Environmental Expense 14,358 4,800 9,300 4,500 93.8% Lower Duwamish and T91 cleanups 7. Public Expense 22,876 4,469 8,311 3,842 86.0% Clean Truck Program 8. Other Non-Op Rev/Expense 25,749 3,972 3,738 (234) -5.9% Total 671,826 662,635 652,702 (9,933) -1.5% Change In Net Assets 55,878 80,453 77,874 (2,579) -3.2% 5 FTEs Summary Aviation Seaport Real Estate Capital Dev Corporate Totals 2013 Approved FTE's 846.8 60.0 168.3 265.5 449.2 1,789.8 Mid Year Approval 2.7 - - 10.0 0.8 13.5 Eliminated - - - (1.2) (1.0) (2.2) Transfers - (1.0) - - 1.0 - Adjusted 2013 FTE's 849.5 59.0 168.3 274.3 450.0 1,801.1 2014 Budget Eliminated - - (3.0) - (3.3) (6.3) Transfer - - - (1.0) - (1.0) New FTE's 9.0 - 1.5 11.8 4.7 27.0 Total 2014 Changes 9.0 - (1.5) 10.8 1.4 19.7 Proposed 2014 FTE's 858.5 59.0 166.8 285.1 451.4 1,820.8 6 Capital Budget Summary Capital Budget Summary by Division $'s in 000's 2014 2015 2016 2017 2018 2014-18 Aviation 230,519 321,023 401,756 301,866 276,096 1,531,260 Seaport 35,046 42,710 52,775 77,775 56,551 264,857 Real Estate 17,643 10,220 8,516 12,568 6,137 55,084 Corp & CDD 11,981 8,814 8,671 8,379 8,559 46,404 Total 295,189 382,767 471,718 400,588 347,343 1,897,605 7 Capital Budget Summary Capital Budget Summary by Category $'s in 000's 2014 2015 2016 2017 2018 2014-18 Commission Authorized/Underway 224,121 185,723 306,817 236,398 206,907 1,159,966 Pending 2013/2014 Authorization 39,499 127,050 64,539 18,365 3,450 252,903 Pending Future Authorization 18,596 57,440 88,979 135,715 126,870 427,600 Small Capital and Other 12,973 12,554 11,383 10,110 10,116 57,136 Total 295,189 382,767 471,718 400,588 347,343 1,897,605 8 Sources of Funds 9 Uses of Funds K 10 Tax Levy Overview Tax Levy Amount ' Levy amount established by the Commission each year as part of the budget process ' The maximum allowable levy for 2014 is $93.3 million ' For 2014 the levy is proposed to be $73.0 million 2014 Tax Levy Uses ' General Obligation (G.O.) Bonds Debt Service ' Regional Transportation & Freight Mobility Projects ' Seaport and Real Estate Environmental Remediation Liability ' Real Estate Capital Improvements and a portion of operating expenses ' Highline School NOISE Insulation ' Office of Port Jobs ' Addition to the Transportation Infrastructure Fund (TIF) 11 Aviation Budget Changes Enplanement growth assumption: change from 2.2% to 3.0% Non-airline revenue changes: ' Rental cars, employee parking, ground transportation, concessions, in-flight meals, commercial properties, club international lounge ' PFC non-operating revenue increase $526K Non-airline expense changes: 'International lounge operating expenses 'Business & Occupation taxes 12 Non-Airline Business Revised $ in 000's 2014 Budget 2014 Budget Change % Non-airline Revenues Public Parking 52,138 52,138 - n/a Rental Cars 40,786 41,167 381 0.9% Employee Parking 5,552 6,218 666 12.0% Ground Transportation 7,555 7,881 326 4.3% Commercial Prop 7,011 6,383 (627) -8.9% Concessions 42,589 42,964 375 0.9% Tenant Marketing 750 750 - n/a Club International 352 1,200 848 241.0% Other 7,678 7,678 - n/a Total Non-airline Revenues 164,410 166,379 1,969 1.2% Non-airline Expenses 85,159 85,691 532 0.6% Net Operating Income 79,251 80,688 1,437 1.8% PFC Non-operating Revenue 67,352 67,878 526 0.8% 13 Seaport Budget Changes since 10/08/2013 Description 10/8/2013 11/5/2013 Change VOLUME TEU Volume in 000's 1,660 1,600 (60) OPERATING REVENUE $'s in 000's Crane Rent 5,818 5,276 ($542) Intermodal Revenue 921 590 (331) Total Operating Revenue Change ($872) 14 Northwest Ports Clean Air Initiatives and Environmental Remediation Liability Classified as Non-Operating Expense $'s Thousands 2014 Non-Operating Expense Budget Clean Air Program ABC Fuels $400 Cargo Handling Equip - Idle Reduction Project 100 Cargo Handling Equip - CNG Truck Pilot ($300K total) 275 Added Truck Scrapping Incentives ($4,702K total) 3,117 3,117 Timing Adjusted Less: CMAQ(1) Grant Revenue ($3,535 total) (2,357) Less: DOE(2) Grant Revenue ($500K Total) (332) Net cost to Port 428 Envir Remediation Liability -Sea 8,500 Envir Remediation Liability -RE 800 Total $13,192 Notes : (1) Federal Congestion Mitigation and Air Quality Improvement Program (2) Washington State Department of Ecology 15 Potential Budget Additions Economic Impact Study ($200K) Airport Job Office Furniture and Equipment ($70K) Construction Labor Market Study with City of Seattle ($25K) Workforce Development Strategy and Career Pathways ($75K) 16 Remaining Schedule Second Budget Reading Nov. 19, 2013 Statutory Budget Filed with King County Dec. 2, 2013 Release the Final Budget Document Dec. 13, 2013 17 Port of Seattle 2014 Preliminary Operating First Reading/Public Hearing November 5, 2013
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