Overview -- NWSA Strategic Business Plan and 2017 Performance Goals & Expectation

Looking back on 2016, the rst full year of The Northwest Seaport Alliance (NWSA), the success is clear. Despite
a troubled industry filled with uncertainty, the NWSA held its ground - and looks to build on that success into
the future. For decades we have heard Washington described as "the most trade -dependent" state - but
we
know it is not just dependency, it is opportunity. Our ability to look beyond our borders allows us to diversify
our
economy, weather economic crisis, enrich our culture with the infusion of international perspective and make a
lasting impact on the world. This ability is inextricably linked to the success of the gateway.

The foundations of the NWSA Ten-Year Strategic Business Plan Goais are anchored in the "Strategies for
Enhancing the Puget Sound Container Trade Gateway" report commissioned by the managing members in 2014.
The NWSA Strategic Business Plan four strategic goals are:

- Enhance the competitive position of The Northwest Seaport Alliance



- Provide reliable and efficient regional and local infrastructure connections



- Improve the NWSA financial position




- Advance environmental stewardship

Many of the attached 2017 Performance Goals involve multiple business plan initiatives and reflect the
interwoven benefit from each specific area of work. At its essence, the NWSA business plan seeks to deliver the
following three outcomes:
i.       Gateway Growth and Optimization: The shipping industry is in a state offlux, with recent
bankruptcies and mergers that is unlikely to end in 2017. Despite this volatility, the move to larger
ships is clear. Those who don't prepare now for these fleets will be late to market with strategic
terminals and miss out. We must continue to focus on key initiatives targeted at
cargo
diversification, developing rail infrastructure and major investments in terminal modernization at
both T6 in the North Harbor and the General Central Peninsula in the South Harbor - with
a focus

on sustainability and environmental stewardship.

II.       Gateway Service Delivery Excellence: We are committed to providing bestin-class service delivery
within the gateway and we will continue to focus on the ease of doing business for
our customers.
8y deploying a proactive customer outreach program and using key performance metrics to tell us
what works and what doesn't, we can make informed decisions about where to invest time and
resources. We invest in comprehensive systems that maximize consistent, efficient cargo flows. Our
initiatives include both innovative technologies and best practices from around the globe.

lll.      Gateway Business Environment: For the alliance to continue to succeed, we must pay attention
outside ofour properties and support the health ofthe entire system. We are dependent
on a well-
functioning transportation system that can move people and goods. In our advocacy role we will
continue to fight for comprehensive transportation investments. A regulatory system focused
on
preserving and protecting what we love about the Puget Sound, while providing predictability and
consistency for those navigating it, is vital to the long term success ofthe gateway. We must build a
culture of exporting and business awareness of how we can leverage
our economic gateway, a vital
ingredient to our state and regional prosperity.

The sum of this work is a busy and audacious agenda for 2017, including other key activities with environmental
stewardship, community engagement and the continued NWSA transition. By executing on the attached 2017
Performance Goals and Expectations, the NWSA will build upon its momentum, maximize organizational clarity
and effectiveness.

We put unrelenting focus on anticipating challenges and providing operational excellence and the best complete
value to our customers worldwide. We know that our customers' success is also ours. Our focus on ease of doing
business is what sets the alliance apart from our competitors.

From our Managing Members to alliance staff, we are ready to meet these challenges and move toward our
2025 Key Metrics of: 6 million TEU cargo growth, 14,600 incremental jobs created and continued financial
sustainability.

2017 NWSA Performance Goals and Expectations

Sustain and Enhance Business Development (Scorecard: Cargo)

(Key Priorities for 2017 and beyond)                Performance Measure
1.  T6 Modernization Project
0  Favorably position multi~year lease
Modernization of T5 dock, berth and power             commitment with customers
infrastructure to meet future container industry           Legal resolution of all permits; Position project
requirements, increase throughput, and position The       for MM decision on construction funding
Northwest Seaport Alliance gateway strategically. /
0  Seek multi-year term lease commitment for T5

0  Advance T-S modernization project to
construction (Wharf, power, berth dredging)


General Central Peninsula Modernization Project         Substantial completion of the initial 700 feet
Modernization of T4 dock, berth, CY and gate             of the pier in 102017 in time for delivery and
complex to meet container customer requirements,        commissioning of (4) cranes in 102018
increase throughput, and position the Northwest          Develop design and permitting documents for
Seaport Alliance gateway strategically.                  GCP Gate and backlancls 40.2017.
- Seek term Lease w/tenant for OCT
Secure Yang Ming business post the OCT lease
0  Complete construction of GCP Phase ll                expiration June 2017
Secure customer commitment for the OCT
footprint
Increase Cargo Diversication for the gateway           Increase customer base and non-container
0  Expand breakbulk, auto and industrial maritime          cargo volumes
activity at properties in North and South Harbor.        Seek term leasels) at strategic properties in N
& S Harbor, in coordination with container
business strategy.
Enhance Gateway Productivity, Efciency and           Enhance service delivery KPIs and establish
Operational Performance                       performance dashboards for internal and
0  Implement the Dray Q system in order to provide        external use
accurate and real-time tracking of drayage turn         Increase Crane Productivity towards a
times                                   strategic target of 30+ moves per hour
0  Implement a year-round financially sustainable          Reduce Drayage Turn Times towards a
extended gate service program                  strategic target of 60 minutes or less
0  Launch a pilot program in order to improve the          Reduce lntermodal Transit towards a strategic
efficiency of the local drayage segment of the          target of 144 hour average or less
supply chain
0  Implement the initial phase ofa Port Community
System that provides a single platform for the
supply chain to exchange operational data
0  Coordinate with terminal operators and labor to
seek implementation of continuous vessel
operations, where applicable

Sustain and Enhance Business Development (Scorecard: Cargo) -Contlnued

(Key Priorities for 2017 and beyond)                Performance Measure
7
5.  lntermodal Rall Product Enhancements -  Year-over-year increase in intermodal rail
Develop and implement a comprehensive rail         cargo volume
strategy which may include an incentive program     0  Increase NWSA market share of transpacific
with contributions from NWSA and other key         discretionary cargo
stakeholders.
Develop an inland port and short-haul rail
product for NW exporters between Central WA
and the NWSA in partnership with other key
stakeholders
6.  Harbor Maintenance Tax Reform                      0   Seek to obtain agreement within AAPA for
Build support among the regional/national port        comprehensive HMT reform
community for revisions to the HMT that address -  Seek to obtain full-use of the trust fund for its
donor port equity and international                intended purpose
competitiveness                         0  Seek to obtain 2106 funding becoming
permanent and part of the trust fund
0  Pursue agreement on annual funding levels for
donor ports
0  Seek to obtain the use of rebate funds are
aligned with NWSA interests

Deliver Superior Financial Performance (Scorecard: Financial Returns)

(Key Priorities for 2017 and beyond)                Performance Measure
1.  Effectively manage the 2017 operating activities to       0   Meet or exceed the budgeted 2017 net
deliver expected financial results                     operating income and distributed cash

Quality Jobs Creation (Scorecard: Job Creation)

(Key Priorities for 2017 and beyond)                Performance Measure
1.  Complete 2017 transition activities -   Complete Total Rewards assessment and
implementation of action items planned for
2017
0  Expand and implement comprehensive
Diversity & inclusion Program
0  Provide NWSA Headquarter location
recommendation
2.  Community/industry Outreach Program                  0   Our local communities better understand the
Execute a proactive engagement strategy with         value proposition of trade and ports to the
stakeholders and the community to advance the       State and support NWSA priorities;
brand, value and support of the NWSA (Le. city         benchmark and establish baseline metric of
governments, chambers of commerce, rotary,         NWSA-community understanding
community groups, etc.)                    0  Annual report on business and economic
Build a more robust external business intelligence       trends in the marketplace that assist in the
capability                                   development of new business
Enhance Washington distribution center
capabilities and shipper recruitment

Demonstrate Environmental Stewardship (Scorecard: Environmental Stewardship}

(Key Priorities for 2017 and beyond)                Performance Measure
1.  Identify and develop maritime industrial                  Maintain permit compliance for Alliance
stormwater treatment best management practices        stormwater permits
Establish a NWSA Stormwater Work Group           Facilitate quarterly meetings in Harbor South
includes tenants, agencies and external              and North to promote compliance of tenant
stakeholders.                              stormwater permits
Improve source control on a minimum of 50
acres by 40. 2017
Evaluate the utility of 3 Northwest Ports Water
Quality Plan, with POS, POT and Port of
Vancouver, BC by 40._2017
2.  Continue to implement the Northwest Ports Clean          Complete the 2016 Northwest Ports Emissions
Air Strategy                                   Inventory by Q4 2017
Reduce DPM emissions per metric ton of cargo by       Scrap a minimum of 40, 2006 or older drayage
80% by 2020, relative to the 2005 baseline            trucks by Q4 2017 for a total of 315 since 2009
Reduce GHG emissions per metric ton of cargo by       Establish a NWSA Steering Committee to assist
15% by 2020, relative to the 2005 baseline            with Clean Truck Program Unification and
provide quarterly briefings to the Managing
Members regarding status of Clean Truck
Program
Evaluate the 2011 Green Gateway carbon
footprint study by Q4 2017
Pilot truck wait time reduction technologies
and best practices by C11 2017
Increase number of container terminals with
fuel efficiency plans by 25% by Q4 2017
Complete Green Marine self-assessment by
C12 2017
Develop a NWSA terminal shore-power
strategy

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