PORT OF SEATTLE 
MEMORANDUM 
COMMISSION AGENDA             Item No.      5a 
Date of Meeting     May 4, 2010 

DATE:    April 5, 2010 
TO:     Tay Yoshitani, Chief Executive Officer 
FROM:    Michael Burke, Director, Seaport Cargo Services 
Michael Kuhlmann, Capital Project Manager 
SUBJECT:  Terminal 5 Crane Cable Reel Replacement 
CIP #C800349 
Amount of this request: $3,420,000       Source of Funds: General Fund. 
Total Project Cost: (Estimate) $3,420,000 
State and Local Taxes to be paid: (Estimate)  $300,000 (est.) 
ACTION REQUESTED:
Request authorization for the Chief Executive Officer execute a contract for materials and
manufacturer technical support to coordinate installation, startup and training to replace
five (5) Crane cable reels at the Seaport's Terminal 5 (T-5) for a total Port capital
investment estimated at $3,500,000.
SYNOPSIS:
The Seaport Division authorized $80,000 for staff to design and prepare documents for
purchase of materials to replace the existing crane cable reels to meet our lease obligation to 
Eagle Marine Services (EMS) to provide functioning cranes at Terminal 5. 
Installation of the new crane cable reels will be completed at the tenant's cost, by EMS
maintenance personnel.
BACKGROUND: 
On September 26, 1985, the Port of Seattle entered into a lease for T-5 with American
President Lines (APL). In that lease , the Port agreed to furnish five "functionally
operational" Paceco "Type E" cranes for the lessee's preferential use. The lease is now
assigned to APL's terminal operator, Eagle Marine Services, Ltd. (a wholly owned
subsidiary of APL, Ltd).

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
April 5, 2010 
Page 2 of 5 
The existing cable handling systems on five of the cranes is now 24 years old and at the
end of their useful lives. Replacement parts are difficult to find and often require custom
fabrication. 
In 2004, the Port relocated to T-5 a sixth Paceco crane. The Cable handling system on
this crane was replaced as part of the relocation. 
Port will purchase the equipment and EMS will do the installation using their own
maintenance personnel; with supervision, startup assistance and training from the cable
reel manufacturer's technical personnel paid by the Port. The new cable reel equipment
will be expected to last for the remaining life of the Paceco cranes, approximately 10
more years. 
PROJECT DESCRIPTION AND JUSTIFICATION: 
Project Statement: 
This is a request to execute a contract for materials and associated technical support to
replace five (5) Crane cable reels at T-5 for a total Port capital investment estimated at
$3,500,000. 
Project Objectives: 
Maintain equipment at acceptable operational standards. 
Complete the project within budget. 
Meet customer schedule needs. 
Maintain community support. 
Comply with all environmental and permitting requirements. 
Analyze potential alternatives to this proposal. 
Meet the Port's financial criteria. 
Meet strategic asset management criteria. 
Scope of Work and Schedule: 
This project would involve the Port issuing a contract to: 
Purchase necessary new mechanical, electrical and hydraulic equipment for
installation of new crane cable reels on 5 Paceco cranes at T-5. 
Procure vendor supplied technical support to supervise installation by EMS
maintenance personnel, provide startup assistance and training. 
Planning and design began in March 2010 Materials for the cranes will be ordered in the
second quarter of 2010. Deliveries and installation will continue through the first quarter

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
April 5, 2010 
Page 3 of 5 
of 2011 as EMS maintenance crews are available for this project. Project is scheduled to
be completed by March 2011. 
STRATEGIC OBJECTIVES: 
This project supports the Ports strategy of "Ensuring Airport and Seaport Vitality". 
BUSINESS PLAN OBJECTIVES: 
Maintains lease agreements with the Terminal tenant, will preserve revenue and will reduce
disruption to the tenant for cable reel repairs. 
FINANCIAL ANALYSIS: 
Budget/Authorization Summary 
Original Budget                                               $0 
Previous Authorizations                                       $80,000 
Current request for authorization                                 $3,420,000 
Total Authorizations, including this request (estimated construction costs)        $3,500,000 
Remaining budget to be authorized (pending permit requirements)                  $0 
Project Cost Breakdown 
Construction                                                  $0 
Construction Management                                     $0 
Material Purchase                                        $3,085,000 
Design                                                 $75,000 
Project Management                                      $40,000
Permitting                                                    $0 
State & Local Taxes (estimated)                                 $300,000 
Total                                                   $3,500,000 
Source of Funds 
The $3,500,000 being requested for this project would be drawn from CIP# C800349,
T-5 Crane Cable Reel Replacement. This project was included in the 2010 Plan of
Finance as a committed project in the amount of $4,000,000.
The funding source for this project will be the General Fund.

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
April 5, 2010 
Page 4 of 5 
Financial Analysis Summary 
CIP Category           Renewal/Enhancement 
Project Type            Renewal & Replacement 
Risk adjusted Discount rate   7.5% 
Key risk factors           This project involves installing new components in existing
cranes, which carries some risk of equipment incompatibility.
The risk of incompatibility is deemed minimal, as similar retrofits
have been successfully performed on other Port cranes. 
There are a limited number of suppliers in this business, mostly
foreign companies. The optimal project timeline for equipment
purchase could be delayed if the Port encounters difficulty in
securing a qualifying bid and obtaining agreement on terms and
conditions. This issue was encountered on a similar project
(crane spreader beam replacement) and ultimately resolved, but
project timing was impacted. 
Project cost for analysis      $3,500,000 (current cost estimate) 
Business Unit (BU)        Container Operations 
Effect on business         This asset replacement project will not generate any incremental
performance           revenue. However it complies with the Port's obligation to
provide "functionally operational" Paceco cranes at Terminal 5
and will preserve existing crane rent revenue for the remaining
useful life of these cranes. 
Incremental depreciation expense from this project is estimated at
$350,000/year, based on a 10 year asset life. NOI after
Depreciation will decrease by the associated depreciation from
this project. 
NOI (in $000's)       Year 1  Year 2  Year 3  Year 4  Year 5
NOI             $0    $0    $0    $0    $0
Depreciation        ($350)  ($350)  ($350)  ($350)  ($350)
NOI After Depreciation   ($350)  ($350)  ($350)  ($350)  ($350)
IRR/NPV             NPV
(in $000's)
($3,500)
ENVIRONMENTAL SUSTAINABILITY/COMMUNITY BENEFITS; 
Environmental 
This work is exempt from review under the State Environmental Policy Act (SEPA) and
the City's Shoreline permitting requirements because it consists of equipment
replacement.

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
April 5, 2010 
Page 5 of 5 
ALTERNATIVES CONSIDERED AND THEIR IMPLICATIONS: 
Alternative 1 - An option of doing nothing would leave the T-5 cranes with antiquated
cable reel systems, will result in increased crane downtime, higher maintenance costs
adversely affecting container handling productivity and potential future increases in
volume. This alternative would mean that the Port would not be meeting its obligations
under the lease. 
Alternative 2 - A high cost solution would be the replacement of the existing cranes with
state-of-the-art Super Post Panamax Cranes, similar to those at Terminal 46. However,
the existing dock, crane power and overall terminal power would need to be upgraded at
significant cost, with no guarantee of additional revenue to the port to offset that cost.
Alternative 3 - - A least cost method of improvement is to provide acceptable crane
performance by simply replacing the existing Cable Reel systems with modern systems.
This will keep the Paceco cranes functional for the remainder of their useful life. 
Alternative 3 is the recommended alternative.
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS: 
Below is a chronology of events and staff actions, including funding authorizations via
re-delegated authority: 
On January 10, 2005 Commission authorized funding for procurement of new crane
drives for the six T-5 cranes. This project was completed in 2007. Total Port cost for
this project was $2,150,000. Commission was informed at that time that these cranes
will need new cable reels in the next couple of years.