PORT OF SEATTLE 
MEMORANDUM 
COMMISSION AGENDA               Item No.       7a 
STAFF BRIEFING             Date of Meeting  November 27, 2012 

DATE:    November 15, 2012 
TO:     Tay Yoshitani, Chief Executive Officer 
FROM:    Beth Osborne, Manager, Federal Government Relations 
Clare Gallagher, Manager, State Government Relations 
SUBJECT:  Federal and State Legislative Briefing 
SYNOPSIS: 
With the start of the new 113th Congress and state legislative sessions in January, Port
staff will provide an overview of the dynamics at the federal and state level, ongoing
policy areas and new priorities likely to appear in 2013. 
FEDERAL GOVERNMENT RELATIONS 
LOOK AHEAD FOR 2013 
2013 Brings Change to Washington's Congressional Delegation 
With President Obama's reelection and the Senate and House maintaining their split
majorities, we can expect to see similar themes in federal politics. The start of 2013,
however, brings significant change to Washington's congressional delegation. With the
retirement of U.S. Representative Norm Dicks, Washington State loses a senior House
Member serving on the powerful Appropriations Committee. After 36 years in office,
Dicks was the "Dean" of Washington's delegation, always working behind the scenes to
advance priorities in the Puget Sound region. 
Washington's U.S. Senators will remain unchanged. For the first time in years, three
freshmen Members from Washington State will be sworn in to the U.S. House of
Representatives. Denny Heck will serve in the newly created Olympia-based 10th District,
Derek Kilmer will serve in the seat vacated by Rep. Norm Dicks, and Rep. Suzan
DelBene will serve in the seat left open by Rep. Jay Inslee. This transition means that
new Members and staff will need to become educated on the Port's priorities. 
Due to redistricting, Puget Sound Members will represent new constituencies. Rep. Dave
Reichert's district extends to new rural areas East of the Cascades, Rep. Rick Larsen's
district moved west to represent the I-5 corridor north of Seattle, Rep. Jim McDermott's
district shifted north to include Edmonds, and Rep. Adam Smith's district shifted north to

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
November 15, 2012 
Page 2 of 9 
represent the first majority-minority congressional district in the state and includes
Seattle, Bellevue and parts of Tacoma. 
2012 Lame Duck and 2013 Overview 
Congressional gridlock was a consistent theme for the 112th Congress resulting in few
legislative accomplishments outside of the highway bill and Federal Aviation
Administration (FAA) reauthorization, setting the stage for significant battles during the
lame duck session and 2013.
Looking beyond core Port priorities, spending, fiscal austerity and tax reform promise to
dominate the agenda. Due to lack of action from the "Super Committee," Congress
approaches the "fiscal cliff" at the end of the year, which includes $100 billion of annual 
government-wide spending cuts as agreed to in a previous debt agreement and the
expiration of the Bush tax cuts and could cause the nation to fall back into a recession.
The U.S. Department of Treasury has recently announced that Congress must also deal
with the controversial debt limit either by mid-January or face default. 
Many federal Port priorities will be carried forward into 2013 and beyond. Despite
obvious challenges, some Senators have been pushing to advance the Water Resources
Development Act (WRDA) during this year's lame duck session, which could include
some Harbor Maintenance Tax reforms, but action in the House is extremely unlikely
until at least 2013. 
Fiscal Year 2013 Appropriations Overview 
In mid-September, Congress passed and the President signed House Joint Resolution 117,
a 6-month continuing resolution to fund the federal government through March 27, 2013.
The temporary funding measure does not include "earmarks" and continues funding at
the current rate of operations for federal agencies, programs and services. While
appropriators would like to pass an omnibus appropriations bill during the lame duck 
session to complete fiscal year 2013 spending, it is more likely for appropriations bills to
be dealt with by a newly elected Congress. Some legislators advocate for the revival of
congressionally-directed spending known as "earmarks," they are likely to remain banned
in 2013. The earmark ban extends to projects in all legislation, including WRDA, which
funds water-related infrastructure projects and is due for reauthorization. 
ONGOING FEDERAL PORT PRIORITIES FOR 2013 
Water Resources Development Act 
Congress continued efforts to reauthorize WRDA this year but was again unsuccessful;
however, Senator Boxer scheduled Senate Committee action during the lame-duck
session. Sources say that the House would not act until next year, if at all, but the Port is

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
November 15, 2012 
Page 3 of 9 
highly engaged in the issue in case it is attached to a larger budget and tax package to
address the fiscal cliff.
In general, WRDA authorizes flood control, navigation, and environmental projects and
studies by the Army Corps of Engineers. Funding for each project is done through the
annual appropriations process. The Port of Seattle seeks to advance four previously
identified WRDA priorities: 
1.  Authorizaing a reconnaissance-level study of deepening the federally-managed
navigation channel in Elliott Bay serving Port of Seattle cargo terminals. The
study will determine the federal interest in pursuing deepening the navigation
channel to accommodate next-generation containerships with capacities in excess
of 10,000 TEUs.
2.  Continuing to support the efforts of the Pacific Northwest Waterways Association
(PNWA) to ensure that all HMTF funds are spent annually, as well as advancing
other HMT reforms. 
3.  Supporting a City of Seattle request related to the completion of the study focused
on the replacement of the Elliott Bay Seawall. 
4.  Permanently extending Section 214 of WRDA 2000, which allows the Secretary
of the Army to accept and expend funds contributed by non-Federal public
entities to expedite the processing of environmental permits. The Section 214
provision has allowed local governments to move forward efficiently with vital
infrastructure and ecosystem restoration projects while still ensuring appropriate
permit reviews are completed first. 
The bill released by Senator Boxer on November 7, 2012, gives the Army Corps full
authority to determine which projects and studies to advance nationwide, which would
likely have a positive impact to advance Port of Seattle's deepening study and possibly
the Elliott Bay Seawall project. The bill does not address the issue of U.S.-bound
maritime cargo entering the U.S. through land borders, but that issue is outside of the
jurisdiction of Senator Boxer's committee. The bill allows for very limited expanded
uses of HMT dollars for ports in HMT "donor" states. 
Harbor Maintenance Tax 
The Port continues work with Congress and the Administration to educate on needed 
reforms to the Harbor Maintenance Tax (HMT), which creates a competitive
disadvantage to Pacific Northwest ports due to our proximity to the Canadian border. We
believe that this is an increasingly national economic competitiveness issue as Mexico
and Canada increasingly ramp up port and freight infrastructure strategies and spending.
As mentioned above, this issue heats up with the Senate considering WRDA. 
Over the last year, at the CEO's request, the American Association of Port Authorities
(AAPA) created a HMT Task Force that developed policy recommendations to the

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
November 15, 2012 
Page 4 of 9 
Legislative Policy Council (LPC), including the principle that United States tax policy
should not disadvantage U.S. ports. The HMT Task Force was established in June by the
LPC and consisted of two port representatives from each of the six port regions. At
AAPA's annual convention in October, the LPC approved this principle and AAPA staff
will advocate this position to Congress. 
Similarly, the Port worked with the United States West Coast Collaboration (USWCC)
and Pacific Northwest Waterways Association, to build support for a unified position on
HMT that focuses on full expenditure of the Harbor Maintenance Trust Fund (HMTF)
and a fair tax structure for all U.S.-bound international maritime cargo.
Additionally, coordinating closely with the Port of Tacoma, the Port of Seattle has been
aggressively seeking a legislative solution to ensure a level playing field for all U.S.
bound international cargo. We are working with members of the Washington delegation
and the committees of jurisdiction in Congress. The Port has made significant progress
this year in educating members about the trade distorting aspects of the underlying law
and working with them to address the problem. In 2013, work must continue to educate
other ports and stakeholders on these issues. Politically, it will be important that any
solution be consensus-driven and widely supported by ports that have historically relied
on HMTF for dredging, especially our partners in the Pacific Northwest. 
To lay groundwork for this effort, the Port worked with the Washington delegation on a
bipartisan basis to request a Federal Maritime Commission (FMC) study on the factors
that contribute to cargo diversion of U.S.-bound cargo to Canadian and Mexican seaports.
The FMC report was released in July 2012 and substantiated the concerns held by the
Port and others that cost is a factor and that U.S. policy could be improved to prevent
diversion. Using this independent study as a basis, the Port will continue throughout 2013
to educate key Members of Congress and Congressional committees of the study's
findings and need for action. 
Federal Aviation Administration Reauthorization 
After 5 years and 23 extensions, Congress passed the "FAA Modernization and Reform
Act of 2012" (H.R. 658), to reauthorize FAA programs through 2015. While
reauthorization work will not begin on the bill for several years, Port of Seattle will stay
engaged on implementation issues.
The FAA legislation included a $5 million competitive pilot program supported by the
Port to allow for joint planning and land-use redevelopment of Airport property. The
Port of Seattle has entered into a joint-planning agreement with the neighboring City of
Burien and intends to compete for funding to support development of almost 165 acres of
under-utilized property adjacent to the Airport.

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
November 15, 2012 
Page 5 of 9 
Notably, the FAA bill maintained the current $4.50 federal cap on Passenger Facility
Charges (PFCs), which are passenger user-fees set by local airports and used for targeted
infrastructure investments that benefit passengers such as airport capacity, safety,
security, and improving the environment. While the decision to levy a fee is local,
Congress has set a cap on PFCs, which has been level since 2000. Today, the maximum
PFC is worth roughly half of its value from 12 years ago. In 2001, under the PFC
framework, the Port Commission voted to collect the maximum amount of the PFC,
which has helped build Concourse A, noise mitigation projects and reconstruct the
satellite transit system at Sea-Tac. As FAA Reauthorization discussions begin over the
next several years, we can expect ongoing policy discussions in the aviation industry and
at airports about whether PFC policy should be adjusted to provide long-term
infrastructure funding. 
Finally, the bill also included language championed by Senator Cantwell to create an 
FAA Center of Excellence for Aviation Biofuels. In 2013, the Port of Seattle will
continue to support partners in the Puget Sound Region who plan to apply through a
competitive process to host this facility. T he Port will continue to work with the FAA to
compete for funding opportunities provided under the bill, and monitor implementation
activities. 
Trade 
The pro-trade agenda continued to advance in 2012. Congress passed legislation to
reauthorize the Export-Import Bank of the United States, and the Obama Administration
engaged in negotiations for the Trans-Pacific Partnership (TPP), a multilateral trade deal
involving eleven Pacific Rim nations. The TPP will be a key trade policy focus for the
administration in 2013. In coming months, we are also likely to see federal action to
establish permanent normal trade relations (PNTR) with Russia. Despite that Russia
joined World Trade Organization in August, because Congress has not passed legislation
to establish PNTR, U.S. businesses will not enjoy the same reduced tariffs as their
competitors until legislation is passed. 
In addition to advocating on these policy issues, the Port has sought to increase
understanding among policy makers that freight issues should be considered part of the
trade agenda, and that better federal freight planning and funding will help increase
exports and U.S. global economic competitiveness. 
Environmental Issues 
As a Member of the Lower Duwamish Working Group (LDWG), the Port of Seattle will
continue to engage at the federal level on the Lower Duwamish Waterway clean-up. At
the time of this briefing, Environmental Protection Agency (EPA) Region 10 has
provided EPA leadership, the tribes and Washington State Department of Ecology a draft
Proposed Plan for review. They have also provided a detailed overview to the

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
November 15, 2012 
Page 6 of 9 
stakeholders and LDWG, during which they indicated they will be making changes
before the Proposed Plan goes out for public comment in January. We understand the
plan, as presented, to be consistent with a scenario that will reduce human health risks,
optimize clean-up technologies, adaptively manage remaining risks, and provide certainty
in the design phase of the project, and there are some important aspects of this plan that
are very much "in-play". EPA aims to post a proposed plan for public comment early
next year, and the Port will stay engaged in the public process. Both before and after that
time, the Port, along with our LDWG partners, City of Seattle, King County and Boeing,
will continue to provide technical and other support to the EPA. 
Federal Surface Transportation Programs 
After multiple attempts to reauthorize the federal transportation bill, the "Moving Ahead
for Progress in the 21st Century" (MAP-21) was signed into law. The bill authorizes
transportation programs and funding through fiscal year 14 (only 27 months). Several
policies supported by the Port were passed in the bill, including the creation of a national
freight policy, development of a national freight strategic plan, and requirement for
performance reports on the performance of the national freight network. 
In the implementation phase of MAP-21, the Port of Seattle continues to work with
partners and stakeholders on the execution of freight policy. Notably, Senator Maria
Cantwell and U.S. Secretary of Transportation (USDOT) Ray LaHood asked the Port to
assist with a press event to announce the creation of a Freight Policy Council to help with
the legislation's freight provisions. Senator Cantwell and Secretary LaHood were joined
by Commissioner Rob Holland at PCC Logistics to make this announcement. The Port
also attended the first Freight Roundtable in Washington, D.C., and provided formal
comments to USDOT. Port staff continues to collaborate with regional stakeholders to
make sure implementation benefits ports and freight infrastructure. 
Additionally, it is worth highlighting that the MAP-21 bill did not extend the
Transportation Investment Generating Economic Recovery Discretionary Grant (TIGER) 
program, which was created in the American Recovery and Reinvestment Act to provide
significant federal assistance to highway, transit, rail, or port projects. However, funding
for TIGER grants has been extended through the continuing appropriations legislation
through March 2013. 
STATE GOVERNMENT RELATIONS: 
STATE LEGISLATIVE SESSION 
The state legislative session will convene on Monday, January 14, 2013. There will be 
105 official days in the session, which is scheduled to end on April 28. The Legislature
must pass a balanced budget for the 2013-15 biennium, including capital and operating

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
November 15, 2012 
Page 7 of 9 
budgets, and transportation appropriations. There were incumbent losses in the
November general election, but no shift in majority/minority party representation. 
State Budget 
Based on the September revenue forecast, the state expects to face a $1 billion gap
between revenues and budget, as well as $1.1 billion to address the McCleary decision by
the state Supreme Court regarding funding for K-12 education. The outgoing
administration will propose a budget as it leaves office, including a proposed increase in
revenue. The incoming administration will revise the proposed budget upon taking
office, which will provide a better indication about new revenue and policy direction
closer to the start of session. 
The governor-elect has signaled minimal/no support for new revenue, as well as the need
to implement reforms in state government as part of budgetary concerns. Because of the
passage of I-1185, tax increase measures will still require a two-thirds vote of the
Legislature, unless or until this measure is litigated. A vote to put a tax increase measure
on the ballot only requires a simple majority, so that option is still available to leadership,
but has not been proposed by the incoming administration.
Revenue proposals affecting core Port businesses, such as changes in tax rates for
stevedoring services or freight movement, as well as proposals that raise costs overall,
will be monitored so that the potential impact is clear, but at this time no specific
proposals are available. 
Transportation Funding and Stimulus Spending 
Ongoing activity in this area includes both near-term spending and long-range planning
for a new transportation funding package in the state. Regardless of federal stimulus
monies received in the past few years, the funding stream for the state's adopted project
list of transportation projects is largely spent by 2015 and completed by 2017. No n ew
revenue exists to fund a new round of projects, since 100 percent of the current stream
from the nickel tax and Transportation Partnership Program (TPA) was bonded to pay for
the project lists developed through those packages. Future funds are declining, both with
the overall revenue stagnation in the state, and purchasing power in major revenues
sources (gasoline and diesel tax and licenses, permits and fees). Over the entire 16-year
forecast horizon, transportation revenues remain down, so the work in long-range
planning is very important to identify ways to stabilize the funding sources for
transportation. 
The last Office of Financial Management (OFM) forecast shows gas taxes as 50% of all
transportation revenue in the 2011-13 biennium. Including diesel fuel taxes, motor
vehicle fuel taxes comprise 62% of all transportation revenues. Licenses, permits and fee
revenues comprise the second largest share at 21% of all transportation revenues. The

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
November 15, 2012 
Page 8 of 9 
largest three revenue sources (gasoline and diesel fuel taxes and licenses, permits and
fees) are projected to provide 83% of state transportation revenues through the current
biennium. The remaining 17% includes ferry fares, toll revenue, driver-related revenue
and other transportation-related revenue. 
Legislators likely will contemplate a range of policy options to update and increase
transportation infrastructure funding, but it is unclear what kind of legislative action will
occur in the 2013 session, even to put a funding package on the ballot in 2013. State
lawmakers are monitoring the state's implementation of the federal MAP-21
transportation funding bill, and the move toward performance-based program investment. 
Consistent with the Connecting Washington task force recommendations regarding future
funding options and principles for investment, the Transportation Commission is
reviewing alternatives or supplements to gas tax revenue, specifically a road user fee.
The Port is serving on the committee that will prepare recommendations to the
Legislative in early January. In any transportation budget or statewide package, the Port
continues to advocate for funding of the I-5/SR-509 Completion Project, securing
permanent funding for maintenance and preservation of roadways, and, following the
focus on SoDo and the industrial area, the necessary transportation investments needed to
support current and future maritime and industrial activity around the seaport.
Other Legislative Activity for Ports 
In addition to the budget challenge and development of a platform for transportation
infrastructure funding, there are other areas of great interest we will be managing during
the session. We are collaborating with other ports and the Ports Association to keep
funding for the Model Toxics Control Act (MTCA) account before the members, since
this funding directly affects our environmental clean-up projects. The fund is used by
local governments, including ports, for toxic cleanup efforts, and a recent survey done by
the state confirms that many areas across the state are relying on MTCA funds for
ongoing or planned projects, including millions of dollars for many Port of Seattle
cleanup sites. If MTCA funding is not continued, the Port will lose a significant source
of funds for future clean-ups, despite having entered into Agreed Orders with Ecology to
assure eligibility for the grant funds. Funds from the local MTCA account are available
for 50% grant matches to clean up contaminated sites.
The Legislature may also see bills related to marine tourism, liability and handling of
derelict vessels and perhaps a proposal for tourism funding. Labor relations issues, along
with use of in-state work force on public projects and at public facilities, continue to be
brought forward for discussion and consideration.
More specifics on all these topics will become available as the state legislative session
begins.

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
November 15, 2012 
Page 9 of 9 
OTHER DOCUMENTS ASSOCIATED WITH THIS BRIEFING: 
None.