PORT OF SEATTLE 
MEMORANDUM 

COMMISSION AGENDA             Item No.      5b 
Date of Meeting    February 24, 2009 
DATE:    February 6, 2009 
TO:      Tay Yoshitani, Chief Executive Officer 
FROM:    Craig J. Kerr, Treasury Manager 
SUBJECT:  New bid for Banking Services 
ACTION REQUESTED: Authorize the Chief Executive Officer to Bid and Execute a
Contract for Banking Services for Five (5) Years with the
Right to Extend for Two (2) Additional One (1) Year Periods
at an Estimated Cost of $8,800,000. 

BACKGROUND 
In 2002, when the Port became its own Treasurer, staff bid for Banking Services for Five (5) years
with the right to extend for two (2) additional one (1) year periods. The contract with Bank of
America expires on July 31, 2009. Banks have a significant cost to implement a new customer on
the electronic platform and provide better pricing to customers with longer duration contracts. The
Request for Proposal for banking services will provide a competitive selection process for all
qualified banks. The selection will be based on a combination of fees and service capability and
will be made by a selection team comprised of representatives from Accounting Services, all
Finance departments and Information and Communications Technology. 
BREAKDOWN OF BANKING FEES 
The majority of Port banking fees result from accepting credit cards. Airport Parking accounts for
78% of all Port credit card receipts. Credit cards provide four (4) advantages over alternative
payment modes. Those advantages are: immediate receipt of funds, no credit analysis efforts, no
collection effort and a higher degree of security over cash and checks. Set out below is a
breakdown of Port banking fees for 2008: 
Credit Card Fees                   $1,184,825        87% 
All Other Banking Fees*               170,047        13% 
(* Includes Supplies and 1 time Website credit card acceptance fees) 
Total Banking Fees                 $1,354,872

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
February 6, 2009 
Page 2 of 3 

IMPLEMENTATION 
The successful bidder will need to implement and test all aspects of the electronic internet banking
solution to ensure every function of receiving and disbursing Port money is fully operational
before implementation takes place. These changes affect staff in the following Port departments: 
Accounting and Financial Reporting, Finance & Budget, Information and Communications
Technology, all Seaport Marinas, all Airport Parking Operations, Aviation ID Access, Bell Harbor
Conference Center, World Trade Center Restaurant, World Trade Center Tenants and the Port's
Lockbox provider; as a result, many hours of staff time will be required. Some examples of
banking functions that are costly to implement for both the Port and the bank are as follows: 
Receive Electronic Money  The Federal Government, State of Washington and various large
customers pay the Port with electronic money (i.e. wires and ACH Credits). As a result of new
bank account numbers and ABA numbers Port staff must write letters to all electronic payers and
notify them of the new numbers and the effective date of the conversion. In the case of the Federal
Government we must also fill out new forms as well as coordinate receiving money incorrectly
sent to the old bank after the conversion date. 
Direct Deposit of Payroll  Staff must change all of the affected bank numbers in the payroll
system and accounting system plus reformat Payroll files to insure the Direct Deposit of Payroll
can be accepted by the Bank for distribution to all employees selecting direct deposit in the correct
amounts to the right financial institutions. 
Fraud Control (Positive Pay)  For every Accounts Payable and Payroll check written we send an
electronic file to the bank with the checking account number, dollar amount, date of payment and
payee the bank stores in their system. As Port payroll and accounts payable checks are presented
for clearing the bank matches each Port check presented against each Port check issued and
notifies the Port electronically of checks that do not match requiring staff to inform the bank to pay
or not pay the unmatched checks. Port staff must change the bank account numbers and ABA
numbers in the Payroll and Accounts Payable system as well as program the format to fit the
bank's system in order to accomplish this function. 
IRS Tax and Social Security Deposits  Staff must coordinate with the IRS through the appropriate
Federal Reserve Bank, change bank account numbers and ABA numbers so these moneys can be
deducted from the Port's bank account by the IRS on paydays. One complicating factor with this
task is that the IRS only converts on the first payday after being notified of the new bank account
and ABA number instead of converting on an effective date for everything else (e.g. every payday
after the 1st day of a particular month). 
Therefore, we are estimating over a two and one half (2 ) to three (3) month conversion schedule
with the cost of staff time for the conversion between $45,000 and $60,000. In addition, the
implementation costs for a bank are reflected in its fee proposal; the longer contract allows a bank
to recover these costs at a lower fee over a longer period of time.

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
February 6, 2009 
Page 3 of 3 

This conversion cost will apply to any successful bidder including the Port's current provider due
to their conversion to a new electronic format. 
SOURCE OF FUNDS 
All banking services are budgeted annually with basic banking services budgeted in the nonoperations
budget and credit card fees budgeted by the affected operating departments. 
REQUESTED ACTION 
Authorize the Chief Executive Officer to bid and execute a Contract for Banking Services
for Five (5) Years with the Right to Extend for Two (2) Additional One (1) Year Periods at
an Estimated Cost of $8,800,000.