PORT OF SEATTLE 
MEMORANDUM 
COMMISSION AGENDA               Item No.       7a 
STAFF BRIEFING             Date of Meeting  September 11, 2014 

DATE:    August 22, 2014 
TO:     Tay Yoshitani, Chief Executive Officer 
FROM:    Dan Thomas, Chief Financial & Administrative Officer 
Michael Tong, Corporate Budget Manager 
SUBJECT:  2015 Payroll Budget Assumptions Briefing 

SYNOPSIS: 
The purpose of this briefing is to discuss with the Commission key payroll assumptions to
be used in preparing the 2015 budget. 
BACKGROUND 
The Port is preparing the 2015 budget. The budget process includes setting up and testing
new budget modules in the budget system, budget user training, department and division
strategic and business planning, publishing budget guidelines, establishing budget targets,
entering budget data into the system, running budget allocations and budget reports,
conducting department and division reviews, Executive reviews, and Commission reviews,
publishing the preliminary budget for public comments, adopting the final budget, filing
the statutory budget with the King County Council and Assessor's Office, and the
preparation and release of the final budget document. 
PAYROLL BUDGET ASSUMPTIONS 
The 2015 payroll budget assumptions are outlined as follows: 
1)  Pay for Performance 
As a reminder, our Total Rewards Philosophy as approved by the Commission calls for
pay and pay increases to be market competitive. Similar to the past several years, we are
projecting an average 3.0% Pay for Performance increase for non-represented employees
in 2015 based on preliminary market survey data. With inflation and the economy
continuing to show relatively slow growth it is unlikely that this assumption will
significantly change. However, as more data becomes available later in the budget
process it may be revisited.

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
August 22, 2014 
Page 2 of 3 

2)  Salary Ranges Increase 
We currently anticipate needing to increase non-represented salary ranges by up to 2.0%
to maintain market competitive pay ranges for 2015, which is also consistent with the
past several years. This increase will affect only a small number of employees and the
financial impact will be negligible. 
3)  Intern Pay Rates 
With the recent City of Seattle Minimum Wage Ordinance, we have updated the
methodology for calculating intern rates to ensure compliance with this new
requirement. Intern rates were previously based on the Washington State minimum wage
but effective 1/1/15 they will be based on the City of Seattle minimum wage. In 2015 the
high school intern rate will be $11.00/hour and college and graduate intern rates will be
scaled using that as a base. 
4)  Port-Sponsored Medical/Dental Benefits (covers all non-represented and some
represented employees) 
The budgeted net cost for our self-funded medical/dental and fully-insured Group Health
benefits plan is projected to increase by 1.6% compared to 2014. This reflects continued
progress in managing medical costs through our healthcare strategy. 
5)  PERS Retirement Contributions 
We have no firm information regarding potential changes to employer contributions to
PERS next year, which must be adopted by the Legislature. Based on information from
the Office of the State Actuary, we are projecting that next year's full year blended rate
will increase to 9.86% compared to 9.21% this year. 
6)  Benefits for Interns 
The requirement of the Affordable Care Act to provide medical coverage to employees
working more than 30 hours per week also applies to interns who currently do not receive
benefits beyond holiday pay. Intern hours are already limited to ensure proper
application of DRS regulations for PERS eligibility. Beginning in 2015, intern hours
worked will also be limited to no more than 1,300 per calendar year. 
7)  Represented Employees 
Pay increases for represented employees are governed by individual contracts  most are
based on CPI (0-6%), while some include negotiated increases and/or STEP
increases. Health & Welfare and pension contributions for employees not covered by

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
August 22, 2014 
Page 3 of 3 
Port-sponsored plans are also governed by contract. We have been successful in
incorporating employee healthcare cost sharing in all of our union contract renewals. 
OTHER DOCUMENTS ASSOCIATED WITH THIS BRIEFING 
None 
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS 
August 19, 2015  Tourism and OSR Strategies/Programs Discussion. 
August 5, 2014  2015 Seaport and Real Estate Business Plans Discussion. 
July 29, 2014  2015 Aviation Business Plan Discussion. 
June 10, 2014  Briefing on 2015 Business Plan and Budget Process.