PORT OF SEATTLE 
MEMORANDUM 

COMMISSION AGENDA    Item No.   6d
Date of Meeting     February 9, 2010
DATE:   January 15, 2010
TO:     Tay Yoshitani, Chief Executive Officer
FROM:   James R. Schone, Director, Aviation Business Development
Jolene Culler, Senior Property Manager, Aviation Properties
SUBJECT: Concession Agreement between the Port of Seattle and the Rental Car Companies
ACTION REQUESTED: 
Request for Port Commission authorization for the Chief Executive Officer to execute
Concession Agreements between the Port of Seattle and the Rental Car Companies. 
SYNOPSIS: 
The Rental Car Companies are expected to begin operations in early 2012 from the Consolidated
Rental Car Facility (CRCF) located at Seattle-Tacoma International Airport (Airport). The
framework for the business deal between the Port and the Rental Car Companies includes both a
Lease Agreement that was presented to and approved by Commission on May 13, 2008, and a
Concession Agreement (Exhibit A) that is being presented today. While the Lease Agreement is
focused on lease terms and operational rules for the facility, and the financial obligations
associated with those terms and rules, the Concession Agreement focuses on the rights granted to
the Rental Car Companies to operate from the facility and the fees that they will pay for these
rights. The Concession Agreement has a term of ten (10) years and at the completion of each 10
year period during the thirty (30) year life of the lease, it will be open for renegotiation.
BACKGROUND: 
For the past eleven (11) years, the Port has pursued the development of a CRCF at the Airport.
This facility is intended to support all Airport-related rental car operations at one location,
thereby providing a more efficient and equal but competitive operating environment for the
rental car companies. The location chosen for this facility is an approximately 23-acre site
bounded by International Boulevard (State Route 99), State Route 518, and South 160th Street.
The long project development period has been due to numerous stops and restarts related to the
economic impacts of the September 11, 2001 terrorist attacks, the completion of legislative
action to secure project funding, and the potential relocation of Southwest Airlines operations to
King County International Airport.

COMMISSION AGENDA 
T. Yoshitani, Chief Executive Officer
January 15, 2010
Page 2 of 5

There are currently thirteen rental car companies operating at the Airport. Five of these
companies (Alamo, Avis, Budget, Hertz, and National) are full-service companies and have
facilities located on the first and second floors in the main garage, as well as customer service
counters on the baggage claim level in the terminal. These five companies represent 80-85
percent of the total Airport rental car market. Four companies (Advantage, Dollar, Enterprise,
and Thrifty) are limited-service companies and only have customer service counters on the
baggage claim level in the terminal. These limited-service companies transport their customers
to their off-site facilities via courtesy vehicles. There are also four smaller companies (Century
Auto Sales, U-Save, Seattle Car Rental, and Fox) who operate as off-site companies and do not
have facilities at the Airport. These off-site companies transport their customers to their off-site
facilities via courtesy vehicles. For fiscal year 2009, the rental car operations generated
approximately $56.5 million in non-aeronautical revenues. Approximately $34.5 million is
operating revenue derived from concession fees, space rent and land rent. The remaining $22
million is non-operating revenue derived from the Customer Facility Charge (CFC) of $5.00 per
transaction day and the associated interest earnings, that was initially authorized by the
Commission on February 1, 2006.
In May 2008, the Lease Agreement was presented to and approved by the Commission with the
understanding that the Concession Agreement would be presented following a competitive bid
process to determine the location of each company in the facility and the Minimum Annual
Guarantees (MAG's).
In July 2009, the Port began the competitive bid process, and on January 4, 2010, all of the full
and limited service companies currently at the Airport submitted their bids in the form of a MAG
to secure their space in the facility. One company new to the Seattle market, E-Z Rent A Car,
submitted a bid for the Small Operator Area. This leaves two Small Operator Areas available for
future new Small Operator entrants.
The bid process required companies with similar market shares to bid for similarly sized blocks
of space within the facility. This ensured that the large companies were only bidding for the
larger blocks and the small companies were only bidding for the smaller blocks. While the
overall sizes of the blocks for each of the market shares was similar, the locations differed with
some locations being more desireable than others. The companies that bid the highest got to pick
their space first, and then the next highest bidder got to pick their space, and so on.
At this time, all companies have been notified of the space they will get if the Commission
approves the Concession Agreement. Once the Concession Agreement is executed, the rental car
companies will begin the design and construction of their tenant improvements for their
exclusive use areas.

COMMISSION AGENDA 
T. Yoshitani, Chief Executive Officer
January 15, 2010
Page 3 of 5

SCOPE OF AGREEMENT: 
Term/Effective
Date:          Lease Agreement is effective upon signing by both parties.
Commencement date is currently anticipated to be approximately April,
2011, through the last day of the thirtieth (30th) year unless the financing
requires a longer term.
Concession Agreement term is ten (10) years from the first day of the first
full month following the opening date of the facility (currently anticipated
to be first quarter 2012).
Grant of Concession/
Premises:       Right to operate a Rental Car Concession at the CRCF at the Airport
subject to all the terms and conditions of the Lease Agreement.
Concession Fees:   The combined MAG for all companies for the first year of the Concession
Agreement is $21,546,420. For the second and subsequent years, the
MAG shall be an amount equal to eighty five percent (85%) of the total
amount paid or payable by concessionaire to the Port for the previous
Agreement Year or the MAG for the first Agreement Year, whichever is
greater.
The Concessionaire will pay to the Port the higher amount of a percentage
fee equal to ten percent (10%) of Gross Revenues or their MAG.
Security/Insurance: Subject to all the terms and c onditions of the Lease Agreement.
STRATEGIC OBJECTIVES: 
This Concession Agreement supports the Port's strategy to "Ensure Airport and Seaport Vitality"
by increasing available public parking and providing improved facilities for all rental car
companies.
FINANCIAL IMPLICATIONS: 
In 2009/2010, the combined MAG for all companies is $20,487,384. Based on the bids received,
the combined MAG for all companies will be $21,546,420 when the operation of the CRCF
commences in 2012. The Concessionaire will pay to the Port the higher amount of a percentage
fee equal to ten percent (10%) of Gross Revenues or their MAG. For the second and subsequent
years, the MAG will be an amount equal to eighty five percent (85%) of the total amount

COMMISSION AGENDA 
T. Yoshitani, Chief Executive Officer
January 15, 2010
Page 4 of 5

(whether by MAG or percentage fees) paid the previous year or the MAG for the first agreement
year, whichever is greater.
ECONOMIC IMPACTS: 
This project continues to support the long term positive economic impacts of the Airport by
increasing available public parking and supporting growth in rental car operations.
In support of the Port's Small Business Initiative, the Port is providing the small rental car
companies (companies with less than two percent (2%) market share) a distinct small operator
area in the customer service building lobby and the floor from which they will operate.
ENVIRONMENTAL SUSTAINABILITY/COMMUNITY BENEFITS: 
The CRCF was designed and built as a green building following LEED guidance. The
consolidated clean busing system will reduce roadway congestion and emissions. Port staff will
be working with the rental car companies to explore ways to further green the operation of the
facility.
TRIPLE BOTTOM LINE SUMMARY: 
The development of the CRCF provides a long-term solution for rental car operations at the
Airport. The region will continue to receive the economic benefit of the Airport rental car
market. In addition, with the completion of the environmental review efforts, no adverse
environmental or community impacts were identified.
PROJECT SCHEDULE: 
The project is scheduled to be completed in first quarter 2012. At that time, all rental car
companies operating at the Airport will operate from the new CRCF.
ALTERNATIVES CONSIDERED/RECOMMENDED ACTION: 
Proceed with the approval of the Concession Agreement as structured. The Port and the
rental car companies followed the agreed upon bid process and the resulting bids and space
allocations are reflective of this fair and competitive process. This is the recommended
alternative. 
Reject the Concession Agreement bids and re-do the bid process. If this alternative is
selected, the CRCF will not be able to open in the first quarter of 2012 as the rental car
companies would be unable to complete their tenant improvements in time for the opening of
the CRCF. This alternative is not recommended.

COMMISSION AGENDA 
T. Yoshitani, Chief Executive Officer
January 15, 2010
Page 5 of 5

PREVIOUS COMMISSION ACTION: 
The following list of previous Commission actions include only those related to the business
aspects for the project.
May 24, 2005, the Commission heard the first reading of Resolution No. 3542 which
imposed a Customer Facility Charge (CFC) on customers of rental car companies accessing
the Airport for the purposes of financing, designing, constructing, operating, and maintaining
a consolidated Rental Car Facility.
June 14, 2005, the Commission passed Resolution No. 3542 which imposed a CFC on
customers of rental car companies accessing the Airport for the purposes of financing,
designing, constructing, operating, and maintaining a consolidated Rental Car Facility.
April 30, 2007, the Commission authorized $1,800,000 for a five-year Cost Advancement
Agreement for technical consulting services to support the Rental Car Companies (RACs) in
their deliberations with the Airport.
May 13, 2008, the Commission authorized execution of the Lease Agreement between the
Port of Seattle and the Rental Car Companies will operate from the Rental Car Facility.
June 10, 2008, the Commission heard the first reading of Resolution No. 3599 to amend and
restate Resolution No. 3542 and authorizing Port staff to the raise the CFC to a level
sufficient to pay the Port's obligations under the Lease Agreement and satisfy the bond
obligations.
June 24, 2008, the Commission passed Resolution No. 3599.
October 14, 2008, the Commission approved the use of Airport funds to provide temporary
funding of the CRCF to allow for continuation of the project construction.
December 15, 2008, the Commission suspended construction of the CRCF.
May 12, 2009, the Commission was briefed on the CRCF Financing Plan.
June 30, 2009, the Commission lifted the suspension on the construction of the CRCF.
July 28, 2009, the Commission approved the establishment of a 7.4% interest rate on a Port
Investment to partially fund the costs with the design and construction of the CRCF.
October 13, 2009, the Commission authorized the execution of an amendment to the current
Rental Car Lease and Concession Agreement to extend the lease term for the Rental Car
Companies operating at the Airport until the opening of the CRCF and to modify the MAG.
ATTACHMENTS: 
Exhibit A - Rental Car Concession Agreement