ITEM NO:       6a 
DATE OF MEETING: November 28,2017 
Port of Seattle 
Second Reading of the 2018 Budget 
Commission Meeting 
November 28, 2017 

1

Outline 
Budget Changes from the First Reading 
2018 Budget Overview 
2018 Operating Budget 
2018 Comprehensive Operating & Non-Operating Budget 
2018-2022 Capital Plan 
2018 Staffing Summary 
5 Year Financial Forecast 
2018 Sources and Uses of Funds 
2018 Tax Levy 
Remaining 2018 Budget Schedule 
2

Changes from the First Budget Reading 
Moved CIP C800993  Property Acquisition above the line to be included in
the 5-year capital funding plan. Proposed funding source is the Tax Levy 
Added $200K for Eastside Remote Bag Check-in (and Mass Transit)
feasibility study 
Added 8 additional High School interns to increase the total number from 82
to 90 in 2018 (a budget increase of $44K) 
Added $50K for Eco Tourism and $50K for International Tourism for a total of
$100K additional Tourism funding 
Added $431K operating revenue and $295K operating expense, which
includes 2 new FTEs, to the 2018 budget due to the Property Acquisition
noted above 
Total operating revenues increase by $431K and total operating expenses
increase by $639K from the First Reading 
Budget amendments incorporated into the budget 
3

2018 Budget Highlights 
Operating revenues are budgeted at $670.5M, $50.2M or 8.1% higher
than 2017 budget 
Operating expenses are budgeted at $422.9M, $38.2M or 9.9%
increase from 2017 budget 
Net Operating Income is budgeted at $247.6M, $12.0M or 5.1% above
2017 budget 
The 2018 capital budget is $895.1M and the 5-year capital spending
plan is approximately $3.1 billion 
The proposed tax levy for 2018 is $72.0M 
The 2018 budget reflects the Port's growth and continued investments for the region 
4

2018 Key Initiatives/Budget Drivers 
Support for Business Growth and Customer Service 



Continue to improve       Catch up with strong Sea-   Grow international and       Support the airport
customer service           Tac growth              domestic passenger          capital improvement
Continue to improve       Strengthen the Port's      service                 program 
safety & security            own Centers of Expertise   Increase Air Cargo            Address growing airport
office space needs 
Growth is a key budget driver 
5

2018 Key Initiatives/Budget Drivers 
Implement Commission Priorities & Initiatives 



Energy and Sustainability  Workforce development       Expand tourism           Restore and enhance
Equity Program         opportunities for small &      opportunities            waterside habitat 
Priority Hire             disadvantaged businesses      Advance real estate
WMBE           Continue internship program   development 
Expand public outreach 
Budget resources support Commission priorities 
6

2018 Operating Budget Summary 
2016    2017    2017    2018   Budget Change Budget vs Forecast
($ in '000s)                  Actual   Budget  Forecast   Budget       $ %        $ %
Operating Revenues         598,466  620,245  623,775  670,479  50,234   8.1%   46,704   7.5%
Operating Expenses         325,124  384,660  376,118  422,885  38,225   9.9%   46,767  12.4%
Net Operating Income        273,342  235,585  247,657  247,594  12,009   5.1%     -63   0.0%


A record $670M of operating revenues for 2018 
7

2018 Comprehensive Budget 
2016    2017    2017    2018   Budget Change
($ in '000s)                             Actual   Budget  Forecast   Budget       $ %                    Explanations
Revenues
1. Aeronautical Revenue - Net            244,235   274,799   266,637   301,082   26,282    9.6% Cost recovery under SLOA.
2. Portwide Non-Aeronautical Revenue      354,231   345,446   357,138   369,398   23,952    6.9% Mainly due to higher revenues from the Airport, Maritime & EDD.
3. Tax Levy                            71,678    72,000    72,000    72,000 -    0.0% Assume no change from 2017.
4. PFCs                               85,570    89,087    92,087    91,787    2,700    3.0% Higher enplanement forecast for 2018.
5. CFCs                               24,715    26,300    26,300    22,161   (4,139)  -15.7% Paid off CFC-funded commercial paper in 2017.
6. Fuel Hydrant                          6,992     7,024     7,024     7,023       ()    0.0%
7. Non-Capital Grants and Donations           6,284     8,595     5,595     5,504   (3,091)  -36.0% Lower state grant for T117 in 2018.
8. Capital Contributions                    18,108    15,000    10,000    41,379   26,379  175.9% Increase grants reimbursement from FAA and TSA.
9. Interest Income                        8,448    10,822    15,822    15,713    4,891   45.2% Slight increase in rates and higher cash balances.
Total Revenues                    820,261   849,073   852,603   926,047   76,973   9.1%
Expenses
1. O&M Expense                       325,124   384,660   376,118   422,885   38,225    9.9% New budget initiatives and average pay increase.
2. Depreciation                         164,336   166,300   164,300   163,309   (2,991)   -1.8% 2017 YTD actual lower than the budget.
3. Revenue Bond Interest Expense            105,567   122,026   107,026   122,544     518    0.4% Assume $700M new bond issuance in 2018.
4. GO Bond Interest Expense                 9,765    17,714    14,714    13,501   (4,213)  -23.8% Savings from bond refinancing.
5. PFC Bond Interest Expense                5,251     4,985     4,985     4,437     (548)  -11.0% Decreased debt service on PFC bonds through amortization.
6. Non-Op Environmental Expense              280     5,441     4,441     2,250   (3,191)  -58.7% Revise costs estimates for ERL balance and superfund sites.
7. Public Expense                         8,560     2,488     1,488    10,794    8,306  333.8% $6M for Swift & Safe and $2M for Heavy Haul in 2018.
8. Other Non-Op Rev/Expense                7,485     (257)     (257)      473     730 -283.8%
Total Expenses                    626,368   703,357   672,815   740,193   36,835   5.2%
Revenues over Expenses             193,893  145,716  179,788  185,854  40,138  27.5%
9. Special Item                         147,700 - - - -      n/a Second & third payments for Viaduct contribution in 2016.
Change In Net Assets                46,193  145,716  179,788  185,854   40,138  27.5%
A strong financial position for the Port in 2018 
8

Capital Plan Summary 
Capital Plan Summary by Division 
$ in 000's               2017 Fcst  2018    2019    2020    2021    2022   2018-2022
Aviation                 340,056  815,704  724,212  507,919  459,023  311,828   2,818,686 
Maritime                25,076  54,990  33,321  35,521  20,120  14,845    158,797
Economic Development       4,718   9,178  16,979  22,900   8,580   7,180    64,817
Stormwater Utility             1,407   1,700   1,650    2,592   2,150   2,150     10,242
Central Services and Other      7,328  13,556  12,401  10,071  10,873  11,706     58,607
Total                 378,585  895,128  788,563  579,003  500,746  347,709  3,111,149

Capital projects have been prioritized by staff. 
The capital plan does not include $249.9M for our share of the NWSA capital spending between 2018 and 2022. 
The Port continues to invest in the region with a 5-year capital plan of over $3 billion 
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Revenue per FTE Comparison 



Operating revenues outgrew FTEs for the past 5 years 
10

FTE Summary 
Central
Aviation  Maritime  Econ Dev.    Services     Total
2017 Approved FTE's               962.9         162.3          36.0         870.1        2,031.3 
Mid Year Approval               15.3          1.0 -         15.5          31.8 
Eliminated - - -    (1.0)    (1.0) 
Net Transfers -    1.0    (1.0) -    - 
Adjusted 2017 FTE's (note 1)           978.2         164.3          35.0         884.6         2,062.1 
2018 Budget
Eliminated - - -    (1.6)    (1.6) 
Transfer - - - -    - 
New FTE's (notes 2 & 3)            62.2          5.8         1.0         29.0          98.0 
Total 2018 Changes                 62.2          5.8         1.0         27.4          96.4 
Proposed 2018 FTE's            1,040.4         171.0         36.0        912.1        2,159.5 
Notes:
(1) Includes 1.0 FTE for Stormwater Utility in Maritime Division.
(2) Includes 2 new FTEs for WMBE and 1 new FTE for Priority Hire added after the Commission budget briefings.
(3) Includes 2 new FTEs for the Salmon Bay Marina and 8 new High School Interns added after the first budget reading.
FTEs driven by Commission priorities and growth initiatives 
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5 Year Financial Forecast 
($ in 000's)                                                                                       Compound
Budget  Forecast  Budget           Forecast            Growth
OPERATING BUDGET           2017   2017   2018   2019   2020   2021   2022  2018 - 2022
Aeronautical Revenue - Net                274,799   266,637  301,082  358,885  404,903  463,050  485,623     12.7%
Portwide Non-Aeronautical Revenue          298,738   305,849  322,751  321,429  325,896  333,284  344,049      1.6%
NWSA Distributable Revenue              46,708        51,288   46,647   43,122   42,334   45,815   46,498     -0.1%
Total Operating Revenues              620,245   623,775  670,479  724,320  774,724  844,482  878,561     7.0%
Total Operating Expenses              384,660   376,118  422,885  432,335  452,860  474,081  491,827     3.8%

Net Operating Income Before Depreciation     235,585  247,657  247,594  291,986  321,863  370,402  386,735    11.8%

Forecasted revenues and expenses from CIP C800993  Property Acquisition added to forecast
Steady growth in Net Operating Income projected 
12

Sources of Funds 
Rental Car Customer   Fuel Hydrant Receipts 
Passenger Facility Facility Charges           0.4% 
Charges        1.4% 
Other Receipts 
Tax Levy    5.6%                          0.2% 
4.4% 
Grants and Capital                                                          84% of funding
Operating Revenues 
Contributions                                             41.2%              sources come from
2.9%                                                          bond proceeds and
operating income. 
The tax levy makes
up less than 5% of
the funding sources
Proceeds from Bond
Issues                                                       in 2018. 
43.0% 


Interest Receipts 
Total Sources: $1,628.9M                                      1.0% 
The Port has diversified funding sources 
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Uses of Funds 
Operating
Expenses 
24.2% 
Plan to spend more
Capital                                                  than half of our
Bond
Expenditures 
Redemptions                 funds on capital
51.2% 
9.9%                   projects in 2018. 
Interest                           Operating expenses
Payments                        are less than a
9.4%                         quarter of total
expenditures in
2018. 
Other Expenses 
0.3% 
Payment to NWSA   Public Expense 
for Capital          0.6%                 Total Uses: $1,748.0M 
Expenditures 
4.4% 
Capital spending comprises more than half of Port expenditures 
14

2018 Tax Levy 
The maximum allowable levy for 2018 is $101.6 million. 
For 2018 the levy will be $72.0 million.
The estimated millage rate is $0.1358. 
The 2018 levy will be used for:
General Obligation (G.O.) Bonds Debt Service 
Regional Transportation projects 
Environmental Remediation 
Capital projects meeting specified criteria endorsed by the Commission 
Economic development initiatives including workforce development and
economic development partnership programs 
Other environmental initiatives including Airport Community Ecology
funding and energy and sustainability policy directives 
The Port uses tax levy for community investments 
15

2009-2018 Tax Levy & Millage Rate 
$ Millions 
$80  $75.90 $73.50 $73.50 $73.00 $73.00 $73.00 $73.00 
$72.00 $72.00 $72.00  $0.70
$70                                           $0.60
$60
$0.50
$50
$0.40
$40
$0.22   $0.22   $0.23   $0.23   $0.22                          $0.30
$30  $0.20                      $0.19  $0.17  $0.15  $0.14 
$20                                           $0.20
$10                                           $0.10
$0                                           $0.00
2009 2010 2011 2012 2013 2014 2015 2016 2017 2018
Tax Levy (Left Scale)           Millage (Right Scale)
The Port has gradually reduced the tax levy amount since 2009 
16

Actual vs. Maximum Allowable Levy 



The Port has forgone $491M in tax revenue since 1991 
17

Remaining Budget Schedule 

File Statutory Budget with King County      Dec. 1, 2017 
Release the 2018 Final Budget Document     Dec. 15, 2017 


Statutory budget to be filed with the County on December 1 
18

Port of Seattle 
Second Reading of the 2018 Budget 
Commission Meeting 
November 28, 2017 

19