PORT OF SEATTLE 
MEMORANDUM 
COMMISSION AGENDA                   Item No.         6c 
Date of Meeting       July 13, 2010 
DATE:      June 14, 2010 
TO:       Tay Yoshitani, Chief Executive Officer 
FROM:     Michael Burke, Senior Manager, Container Leasing and Operations 
Catherine Chu, Capital Construction Project Manager 
SUBJECT:   Terminal 5 Maintenance Dredging Phase I 
Project #103835 
Amount of This Request:  $1,300,000 
Source of Funds: Primarily General Fund, with $175,000 from Tax Levy for qualified
environmental reserve work 
State and Local Taxes Paid: $80,000       Est. Workers Employed: 9 
Total Expected T-5 Phase I Dredging Project Cost: $1,980,000 
Total Expected T-5 Phase II Dredging Project Cost: $6,100,000 
Total Expected T-5 Dredging Project Cost (Phase I and II): $8,080,000 
ACTION REQUESTED: 
Request authorization for the Chief Executive Officer to execute consultant services contracts
amendments and service directives; to provide construction support and permit compliance
services; advertise for bids; and award major construction contracts for the Terminal 5 (T-5)
Maintenance Dredging Phase I project, for a total of up to $1,300,000, bringing the total
authorization amount for T-5 Maintenance Dredging project to $1,980,000. 
SYNOPSIS:
This request is one of a series of authorizations needed to complete maintenance dredging at T-5
and T-18. Dredging ensures adequate depth for navigation and also results in a cleaner waterway
by removing and capping contaminated sediments. T-18 Maintenance Dredging was completed
in 2009.  The proposed T-5 Maintenance Dredging Phase I will provide one deep draft berth at -
50' MLLW and two berths at -45' MLLW by 2011.

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
June 14, 2010 
Page 2 of 6 
ADDITIONAL BACKGROUND: 
On February 26, 2008, Port Commission authorized $400,000 for staff to conduct environmental
and technical assessments, prepare project scope of work and design, conduct environmental
review and apply for permit authorizations for navigational access dredging at T-5 and T-18.
On September 9, 2008, Port Commission authorized total of $2,257,000 for T-18 Maintenance
Dredging including construction, and authorized total of $680,000 for design and permitting
funding for T-5 Maintenance Dredging. T-18 construction was completed in February 2009 as
planned.
Early in 2009, the Port faced serious budget constraints due to economic conditions. As a result,
the Seaport decided to delay T-5 maintenance dredging to 2010-11. The Port Commission was
informed of the decision through 2009 1st Quarter project updates. An additional briefing to the
Commission was presented on November 30, 2009, regarding a comprehensive and long-term
approach to maintenance dredging at T-5, including phasing, strategies, such as advance
maintenance dredging to reduce future frequencies of maintenance dredging events, adequate
allowable over-dredging to ensure permit compliance, and a long-term programmatic permit
which allows a phased approach to maintenance dredging at T-5. 
T-5 is located adjacent but not within two Superfund sites. These sites include the Lockheed
West and West Waterway Superfund sites. 
Funding for Phase I maintenance dredging will come out of the 2010 and 2011 operating budget
and the environmental reserve fund.
The planned Phase II project will first study Berth 3 (the northern berth) for the need and
feasibility to construct an under-water wall in order to ensure that the -50' depth is sustainable.
This study is already in the previous Commission approvals, and is expected to complete by
early 2011. If the wall is necessary and feasible, the total cost for Phase II including the wall is
estimated at about $6,100,000, and would be a capital project except for the environmental
reserve component. The design and construction of the wall would be subject to further reviews
and Commission approval. Approving Phase I does not obligate the Commission to approve
Phase II.
PROJECT JUSTIFICATION:
Although the T-5 lease commitment does not obligate the Port to maintain specific berth depth
requirements, maintaining adequate depths at the container terminals is critical to ensure
navigational access by current and future deep draft container vessels, and therefore contributes
to the Port's goal to maintain and grow Seattle's market share for container business. Dredging
also results in a cleaner waterway by removing and capping contaminated sediments.

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
June 14, 2010 
Page 3 of 6 
PROJECT STATEMENT AND OBJECTIVES: 
Project Statement: 
Perform T-5 Phase I maintenance dredging and comply with permit conditions, to provide one
deep draft berth at -50' MLLW, and maintaining the two remaining berths at -45' MLLW. 
Project Objectives: 
The objective of the proposed project is to maintain navigational access for deep draft cargo
vessels serving T-5, and comply with all permit conditions. 
PROJECT SCOPE OF WORK AND SCHEDULE: 
Scope of Work: 
Execute consultant services contracts and amendments, advertise for bid, award major
construction contracts, perform T-5 Phase I maintenance dredging and comply with permit
conditions, to provide one deep draft berth at -50' MLLW, and maintain the two remaining
berths at -45' MLLW. Phase I dredging area includes area between Station 4+00 to 9+00 (Berth
1, 500') to -45' MLLW, area between Station 9+00 to 19+00 (Berth 2, 1000') to -50' MLLW,
and area between Station 19+00 to 29+00 (Berth 3, 1000') to -45' MLLW. Also included is any
permit allowed and/or required advance maintenance dredging (up to 1'), allowable overdredging
(up to 4'), and backfill with clean sand (for both slope stability and environmental
protection ). Costs include outside services and in house staff time, construction contract
payments, contingency, sales tax, permit fees, and other administrative and overhead costs. 
Schedule: 
Phase I maintenance dredging is expected to be completed by February 2011. The Port is
expecting the Army Corps of Engineers approval of the Joint Aquatic Resources Permit before
scheduled contract award in September. Delays in permitting, while not anticipated, could pose
a risk to project completion within the permit required construction window between December
1, 2010 and February 15, 2011. 
FINANCIAL IMPLICATIONS: 
Budget/Authorization Summary 
Previous Authorizations                                                          $680,000 
Current request for authorization                                          $1,300,000 
Total Authorizations, including this request                                       $1,980,000 
Remaining budget to be authorized (pending phase II capital project request)   $6,100,000 
Total Estimated Project Cost                                                    $8,080,000

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
June 14, 2010 
Page 4 of 6 
Project Cost Breakdown
Construction                                                                 $800,000 
State & Local Taxes                                                          $80,000 
Construction Management                                                $156,000 
Design                                                                   $595,000 
Project Management                                                      $136,000
Permitting                                                                       $213,000 
Total Authorization:                                                   $1,980,000 
Source of Funds 
The 2010 operating budget included $450,000 for Terminal 5 maintenance dredging. Actual
spending in 2010 is expected to be approximately $600,000, and accordingly will create an
unfavorable operating expense variance of $150,000 in 2010. Seaport Division will seek ways to
offset this increase in operating expenses with savings in other areas. The remaining $1,000,000
of the project authorization will be included in the 2011 Operating Expense Budget. 
With the exception of the environmental reserve work described below, the cost of this project
will be funded from the general fund. 
It is expected that approximately $175,000 of the Phase I project construction costs (including
upland disposal of contaminated sediment and some of the surface cover for exposed sediment)
will be GASB 49 environmental work. The GASB 49 portion of this project will be paid out of
operating Environmental Reserves. The source of funds for the GASB 49 environmental portion
of the project will be the tax levy.
Financial Analysis Summary
CIP Category     NA 
Project Type      Expense  Renewal/Replacement 
Risk adjusted     NA 
Discount rate 
Key risk factors    Key risk factors include potential cost overruns due to project time
constraints or expansion of project scope due to higher than anticipated
levels of sediment contamination 
Permit requires narrow construction window from 1/1/2010 to 2/15/2011,
which could result in a lack of bids and/or higher bids 
Permit delays could result in delaying the project by an entire year due to
narrow construction window 
Agencies could impose additional permit conditions beyond current
project scope

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
June 14, 2010 
Page 5 of 6 

Project cost for    $1,980,000 
analysis 
Business Unit     Container Operations 
(BU) 
Effect on          Project costs incurred to date have had the following effect on NOI for years
business          2008/2009. The estimated total project costs will have the following effect
performance      on NOI in future years. Depreciation expense will not be impacted by this
project, as this dredging project is an operating expense. 
NOI (in $000's)                    2008      2009      2010      2011    TOTAL
Incremental Revenue - - - - - 
Incremental OpExp              (209)     (170)     (601)    (1,000)          (1,980) 
NOI                       ($209)    ($170)    ($601)  ($1,000)  ($1,980)
Depreciation                        $0        $0        $0        $0        $0
NOI After Depreciation        ($209)    ($170)    ($601)   ($1,000)   ($1,980)
IRR/NPV        NA 
ECONOMIC IMPACTS AND BUSINESS PLAN OBJECTIVES: 
The impacts of not doing this work are severe. Container vessel operations will be disrupted and
possibly diverted to other ports if water depths are not sufficient to accommodate deep draft
vessels. 
STRATEGIC OBJECTIVES: 
This project supports the Port's strategies to "Ensure Airport and Seaport Vitality" and "Exhibit
Environmental Stewardship through our Actions", by: 
Maintaining required navigation depth for deep draft container vessels; 
Improving water quality by removing and capping contaminated sediments from the marine
environment; 
The project will acquire all necessary and required permits from appropriate agencies prior to
start of construction; and 
will comply with all conditions stipulated by permit authorizations; 
The permit process requires notification of neighboring communities, agencies of interest,
tribes and appropriate environmental groups. Comments are expected and welcome; 
The waters near Harbor Island are treaty-reserved "usual and accustomed" fishing areas. The
Muckleshoot and Suquamish Tribes will be consulted during the permitting process, with the
objective of avoiding potential disruption of Treaty fishing access. 
ENVIRONMENTAL SUSTAINABILITY AND COMMUNITY BENEFITS: 
The design of the T-5 maintenance dredging program reflects lessons learned from recent
projects at T-30, T-91, and T-18, as well as changes necessary to be consistent with new

COMMISSION AGENDA 
Tay Yoshitani, Chief Executive Officer 
June 14, 2010 
Page 6 of 6 
technical guidance developed by the Army Corps of Engineers. The approach is different in four
primary ways: 
An additional one-foot (1') of "advance maintenance dredging" is included beyond the
project depth. Advance maintenance dredging is permitted in critical and fast-shoaling areas
as a means to extend the interval between dredging events. This reduces
mobilization/demobilization costs and results in lower air emissions over time. The
geometry of the dredge prism is characterized in a manner that more accurately portrays the
amount of over-depth excavation that is anticipated based on past experience. Over-depth
dredging occurs due to the inherent margin of error that results from equipment tolerances,
survey inaccuracies, wave and wind conditions, water depth and human factors.
Characterization of the dredge prism in the most rigorous way possible allows regulatory and
contracting compliance to be more predictable. 
The permit strategy will allow dredging to be phased over a ten year period to defer costs
across multiple budget year and to allow differentiation between dredging that will use open-
water disposal from upland disposal. This type of "programmatic permit" also allows
differentiation between near-term and long-term dredging. Programmatic approaches allow
costs and environmental impacts to be better managed and anticipated.
Best management practices will be employed to avoid and limit environmental impacts of
dredging. At least 6" of clean sand will be placed across the dredge area for either structural
or anti-degradation purposes. 
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS: 
On February 26, 2008, the Port Commission authorized $400,000 for staff to conduct
environmental and technical assessments, prepare project scope of work and design, conduct
environmental review and apply for permit authorizations for navigational access dredging at
T-5 and T-18.
On September 9, 2008, the Port Commission authorized total of $2,257,000 for T-18
Maintenance Dredging including construction, and authorized a total of $680,000 for design
and permitting funding for T-5 Maintenance Dredging.
On November 30, 2009, staff briefed the Commission regarding status of T-5 Maintenance
Dredging project and permit strategies for a comprehensive and long-term approach to
maintenance dredging at T-5.