Item 9b Supp

ITEM NO.   9b-Supp
DATE OF
MEETING  May 19, 2009

Port of Seattle
2010 Budget Planning Briefing
May 19, 2009

Overview
2010 Budget Challenges
Proposed 2010 Budget Target
Zero Based Budgeting/Modified ZBB Process
2010 Budget Calendar


2

2010 Budget Challenges
Operating Revenues: May be lower than 2009
Overall economy and the airline/marine industry remain challenging
Airport & Seaport traffic yet to improve
2009 Budget reductions ($16 million) not sustainable
Payroll Cost Increase
Some of the deferred/vacant positions will be filled in 2009
Estimated medical cost increase ($1.9 million or 13%) in 2010
Non-Payroll Cost Increase
Deferred maintenance
New facilities costs (new cruise terminal, new runway, etc.)
New security cost for cruise ships ($600K)

3

2010 Budget Target
Option 1 - Keep NOI flat: Challenging at the
beginning of the budget planning process due to
the timing of traffic & revenue forecasts.
Option 2  Reduce operating expenses:
Try to absorb/reduce all payroll cost increases
Develop options to keep medical costs flat
Propose a 5% reduction on O&M costs from the 2009
approved budget for 2010 based on targeted functional
reviews
4

Modified Zero Based Budgeting
Process
Identify major functions and associated
costs/benefits by department
Conduct analysis & review of major functions
Identify areas for potential savings through reduced
service levels, alternative delivery or elimination
Prepare analysis for further review
Final review & decision process
Develop budgets
5

2010 Budget Calendar
May
Develop & communicate modified ZBB methodology
Brief the Commission on 2010 budget planning process
Prepare preliminary ZBB analysis/decision package
June
Review preliminary ZBB analysis/decision package
Identify areas of savings from programs & services
July
Quantify the budget savings and compare them to targets
Commission briefing on business environment, key
budget assumptions and targets
6

2010 Budget Calendar  Con't
August
Budget guidelines released
Commission briefing on Q2 financial performance
Commission workshops on division business plans
September
Preparation of preliminary operating and capital budgets
Internal division budget reviews
Commission tax levy workshops

7

2010 Budget Calendar  Con't
October
Executive preliminary budget reviews
Commission budget workshops
Operating and capital budgets
Draft Plan of Finance & Tax Levy
November
Release preliminary budget document
First and second reading of budget resolution
December
File statutory budget in the first week of December
8

Limitations of Translatable Documents

PDF files are created with text and images are placed at an exact position on a page of a fixed size.
Web pages are fluid in nature, and the exact positioning of PDF text creates presentation problems.
PDFs that are full page graphics, or scanned pages are generally unable to be made accessible, In these cases, viewing whatever plain text could be extracted is the only alternative.