Item 9a Supp-1 REVISED

ITEM NO.   9a Supp -1
DATE OF
MEETING October 8, 2009

Port of Seattle
2010 Preliminary Budget
Port-wide Total
October 8, 2009

1

2010 Preliminary Budget
2008    2009    2010  '09 Bud to '10 Bud
($ in thousands)          Actual   Budget   Budget    Var $  Var %
Operating Revenues         488,996       486,367       480,336        (6,031)      -1.2%
Operating Expenses         280,266       277,862       284,650        (6,788)      -2.4%
Net Operating Income bef. Depr.  208,730        208,506        195,686        (12,819)  -6.1%
Depreciation              144,208       157,036       158,575         (1,540)      -1.0%
Net Operating Income aft. Depr.   64,521   51,470   37,111   (14,359) -27.9%


2

2010 Preliminary Budget
(without Environmental Expense)
2008    2009    2010  '09 Bud to '10 Bud
($ in thousands)         Actual   Budget   Budget   Var $  Var %
Operating Revenues       488,996       486,367       480,336        (6,031)      -1.2%
Operating Expenses        280,266       277,862       284,650        (6,788)      -2.4%
Less: Environmental Expense   (8,889)   (5,687)  (24,471)  18,784 -330.3%
Adjusted Operating Expenses  271,378       272,175       260,179        11,995   4.4%
Income before Depreciation   217,618       214,193       220,157        5,964       2.8%
Depreciation             144,208       157,036       158,575        (1,540)       -1.0%
Income after Depreciation     73,410   57,157   61,581   4,424       7.7%

33

Net Operating Income Comparison
Operating Revenues, Operating Expenses and NOI
600

500

400
In Millions of Dollars                                                                                Revenues
300                                                             Expenses
NOI Before Depr.

200

100

0
2000  2001  2002  2003  2004  2005  2006  2007  2008  09 Bud 10 Bud

4

Port-wide FTEs Summary
Aviation Seaport Real Estate Capital Dev Corporate  Totals
2009 Approved FTE's       833.1    61.8    151.1     271.3    472.7  1790
Mid Year Approval       2.0    1.6      1.0      3.7     2.0   10.3
Eliminated           -14.0    -6.0     -3.0      0.0     0.0  -23.0
Transfers            -1.0     0.0      0.0      -2.0     3.0    0.0
Adjusted 2009 FTE's        820.1    57.4     149.1      273    477.7 1777.3
2010 Budget
Eliminated           -76.2     0.0     -2.3      -5.0    -31.0  -114.5
Transfer              0.0     1.0      0.0       0.0     -1.0    0.0
New FTE's           2.5    2.0     8.0      0.0     4.5   17.0
Total 2010 Changes        -73.7    3.0      5.7      -5.0    -27.5  -97.5
Proposed 2010 FTE's       746.4    60.4    154.8     268.0    450.2 1679.8

55

Port of Seattle
2010 Preliminary Budget
for
Corporate Professional & Technical
Services
October 8, 2009

6

2010 Corporate Budget Target
Description                   Amount  Notes
2009 Approved Budget           73,571,678 
Add: Budget Transfers from the Airport    507,365        1.0 FTE, PLA, Airport Jobs, and ORCA
Less: One-time Items in 2009         (289,262)
Add: Approved Budget Adjustments      404,040       Items approved after 2009 budget was finalized.
2009 Baseline Budget            74,193,821 
Less: Budget Reduction           (4,675,080) 6.4% reduction from the 2009 approved budget.
Add: Pay for Performance Increase     2,078,480        $1.18M contractual increase from Police.
2010 Prelim. Corp. Budget Target     71,597,220 
2010 New Budget Additions          1,266,237 
2010 Proposed Corp. Budget Target   72,863,457 

7

Budget Cuts Summary
Department                    Amount   FTEs
Public Affairs/Government Relations          600,000     -3.8
Economic & Trade Dev               1,870,631     -6.2
Human Resources & Development         144,968    -1.0
Information & Comm. Technology           572,060    -14.0
Finance & Budget                    270,622     -1.0
Accounting & Financial Reporting             71,812     -1.0
Internal Audit                             60,000      -1.0
Office of Social Responsibility                86,940      -1.0
Police Department                    998,934     -2.0
TOTAL*                    4,675,967   -31.0
* This equals to a 6.4% reduction from the 2009 approved budget.
8

2010 Budget Major Changes
Major Budget Change from 2009 Budget (bef. New Request Items)   Amt Change  %
1) Estimated Payroll Reduction
Estimated Pay for Performance/Wages Increase for 2010            2,078,480
OPEB Increase                                    98,820
Payroll Budget Reduction (VSP & Layoff)                       (1,339,956)          -2.4%
Net Payroll Reduction                                   (837,344)         -1.5%
2) Non-Payroll Reduction
Supplies & Stock                                       (80,572)       -11.6%
Outside Services                                      (573,637)         -5.2%
Travel & Other Employee Expense                          (157,272)        -7.8%
Promotional Expense                                  (149,612)        -33.9%
Worker's Compensation                                68,721  54.5%
Insurance Expense                                   (154,203)        -7.0%
Advertising                                             (286,913)        -57.7%
Charge to Capital (PLA)                                    260,879   7.8%
Other                                           (125,226)        -4.0%
Total Non-Payroll Expenses                             (1,719,592)         -10.2%
Total Budget Reduction                                 (2,556,936)          -3.5%
9

2010 Budget Additions
2010 Budget Additions                  Amount
Port Centennial Planning                    250,000 
Workplace Responsibility Program            210,000 
2 FTEs in HR&D for HCM Support            164,625 
PCI Compliance Mandatory Audit             300,000 
Self Funding Benefits Broker                 150,000 
Deferred Compensation Third Party Admininstrator   80,000 
Other New Requests                   111,612 
Total                                1,266,237

10

2010 Corporate Budget
2008     2009     2010    '09 Bud to '10 Bud
In $ Thousands                      Actual    Budget    Budget      $ %
TOTAL REVENUES              1,727       1,470       1,527         57     3.9%
EXPENSES
Executive                         1,599         1,540         1,550            9     0.6%
Commission                     899        867        894         28     3.2%
Legal                            3,012         2,703         2,753           49      1.8%
Risk Services                       2,768         2,861         3,026          164       5.7%
Health & Safety                        996          985        1,122           137      13.9%
Public Affairs                           4,356          4,270          4,143           (127)   -3.0%
Government Relations                 1,097         1,347         1,422           75      5.6%
Economic & Trade Development          1,645         2,099 -      (2,099) -100.0%
Human Resources & Development         3,973        4,165        5,122         957     23.0%
Labor Relations                        677         731         804          73     10.0%
ICT                          14,577        19,658        19,392          (266)   -1.4%
Finance & Budget                    1,667         1,719         1,556          (163)   -9.5%
Accounting & Financial Reporting            5,863          6,541          6,876           335       5.1%
Internal Audit                             734         1,211           1,136            (76)   -6.2%
Office of Social Responsibility               1,246          1,647          1,478           (169)  -10.2%
Regional Transportation                   402         498         508          10      2.0%
Police                            19,484          19,979          20,334            355       1.8%
Contingency                      4,200          750         750 -      0.0%
Total Corporate Costs                 69,196         73,572         72,865           (707)   -1.0%
Adjust for Airport Jobs                      199          176 -          176        n/a
Total Corporate Cost (adj. for Airport Job)    69,395          73,748          72,865            (883)   -1.2%

11

2010 Corporate FTE Summary
FTEs
2009 Approved Budget                 472.7
2009 Transfers from Aviation Division            3.0
Health & Safety                      1.0
Labor Relations (PLA)                 2.0
2009 Mid-Year Approval (PLA)                2.0
Adjusted 2009 Total                     477.7
Eliminated FTEs                       -31.0
Transfer one FTE to Seaport                 -1.0
2010 Proposed New FTEs                 4.5
HR&D Technology Manager            1.0
HRMS Compensation & Benefits Specialist    1.0
Workplace Responsibility Program Manager   1.0
Admin Assistant                     0.5
Admin Staff Assistant                  1.0
Proposed FTEs for 2010                 450.2

12

Risks
Economic conditions remain uncertain
SAO Performance Audit
Insurance premiums on renewal
Unexpected litigation or claims
Unanticipated event & TSA mandates

13

Corporate 5 Year Capital Budget
(In Thousands)               Est. Act.                                  2010-2014
2009   2010   2011   2012   2013   2014  5 Yr Total
Information & Communication Tech.
ICT Infrastructure & Telephony       5,786    5,880        2,500        2,500 -             10,880
Applications                   8,603    8,665    5,725    3,725    - 18,115 
IT Future Renewal Replacement - -     4,500      4,500     10,500      10,650       30,150
Sub-total                     14,389   14,545        12,725        10,725        10,500        10,650         59,145 
Small Capital Acquisition             982     100     100     100     100     100     500 
TOTAL CORPORATE CIP        15,371  14,645  12,825  10,825  10,600  10,750   59,645



14

Corporate Capital Projects
2010
Project Name (In Thousands)              Spending
INFRASTRUCTURE - Small Cap          2,500
SERVICES TECH - Small Cap           2,000
ID Badge Software Upgrade              2,000
Business Continuity                    1,780
Network Switch Replacements            1,000
Net RMS Replacement                1,000
Maximo                       690
PeopleSoft Financials Upgrade              500
Port Contractor Roster                    450
Enterprise Project Delivery System            400
Windows 7 OS Upgrade                400
P2000 Access Control Upgrade             350
Propworks Upgrade                   325
Network Firewalls                       300
Records and Document Mgmt             300
Cyber Security Info & Event Manager          300
Enterprise GIS-Small Cap                 250
Small Capital Acquistions                  100
TOTAL                  14,645
15

Remaining Schedule
October
Draft Plan of Finance & Tax Levy (10/13)
Preliminary Budget Document to the Commission (10/20)
Release of Preliminary Budget & Draft Plan of Finance
(10/29)
November
First reading of budget resolution (11/10)
Second reading of budget resolution (11/24)
December
Statutory budget filed (12/1)
16

Port of Seattle
2010 Budget Workshop

October 8, 2009

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