Presentation - 2022 Aviation Division Operating and Capital Budgets Briefin
Aviation Division Operating & Capital Budget Commission Briefing Oct 12, 2021 Outline for Aviation presentation Strategy to Budget; Status on CA Objectives; SWOT Strategic priorities Operating budget Capital Budget 2022 2026 Financial forecast 2022 - 2026 Appendix with budget details and business unit reports 2 Century Agenda Drives Division Plans and Budgets CENTURY AGENDA OBJECTIVES Position the Puget Sound Region as a Premier International Logistics Hub Advance this Region as a Leading Tourism Destination and Business Gateway Responsibly Invest in the Economic Growth of the Region and all its Communities Be the Greenest and Most Energy Efficient Port in North America Become a Model for Equity, Diversity and Inclusion Be a Highly Effective Public Agency 3 Strategy To Budget Process Century Agenda g Vision/Goals in 5- 10 Years n SWOT gic Plan Strate Gap Objectives & KPIs 3 5 Years n 2022 Business Plan tatio 2022 Budget n Annual e m 2022 Performance Plans le Im p 4 Progress on Long-Term Goals 5 Progress Towards Long-Term Goals 6 SWOT - Key Implications Path of recovery uncertain SEA well positioned with regional demand and strong hub airlines New facilities and technology offer opportunities to improve customer experience Maintain focus on community concerns SEA facing major capital program: Need to add resources Will put upward pressure on airline rates Use federal relief to achieve SEA financial objectives and moderate airline costs 7 SEA Strategic Focus Remains the Same Aviation Areas of Strategic Focus 1. Health and Safety 2. Security 3. Employee Engagement 4. Community 5. Innovations and Operational Efficiencies 6. Economic Opportunities and Social Responsibility 7. Customer Experience 8. Environment and Sustainability 9. Financial Sustainability 10. Asset Management, Capital Development and Delivery 8 Updated Goals and Objectives Reviewed and updated for each of ten focus areas: Vision and long-term goals 2025 Objectives 2022 Objectives Highest priorities narrowed to: Regulatory/Must Do/Commission Directives Wildly important goals (WIGs) Pretty important goals (PIGs) 9 2022 Budget Priorities: Must Do 1. Safety: Zero Part 139 discrepancies 2. Security: Zero TSA audit findings 3. Environment and Sustainability: NPDES: Noncompliance actions addressed promptly and respective actions implemented. Ecology approval (through permit modification) to utilize TOC instead of BOD as IWS regulatory parameter. Deep infiltration: If 2021 testing successful, infiltration incorporated into roadway realignment PDD; if testing not successful, evaluation of alternative BMPs to offset detention needs IWS: Compliance with King County permit. Implement and track KC approved measures within UMP and capital development program 10 2022 Budget Priorities: Must Do 3. Environment & Sustainability (cont.): Asset Management (Lagoon 3 integrity): continue groundwater monitoring and maintain assets to help ensure regulatory compliance. Collect a minimum of three groundwater samples by (Q4); coordinate regulatory actions to support F&I liner inspections and repairs (Q3) PFAS: Implement actions in 2021 DOE Chemical Action Plan; submit Toxic Inventory Report AFFF releases (7/1); continued investigation of sites with high-level areas of concern; install GW monitoring wells at former training pit sites (if not done in 2021) AFFF: Within 120 days of FAA approval to use fluorine-free foam, purchase new foam, transition trucks to be able to use, and handle old foam as cost-effectively as feasible. Flight Corridor: Phase 1 and 2 compliance obligations met (SEPA). 4. Commission Directives: Biometric Air Exit vendor support Resiliency: annual exercise Ground Transportation Access Plan: passenger mode choice model Human Trafficking training 11 2022 Budget Priorities: WIGs 1. Health & Safety: Achieve 5% reduction in major incident rate (~16.5) 2. Employee Engagement: Achieve score +3% above 2021 baseline for employee engagement survey 3. Community: Complete 10% of 2014 Part 150 noise remedy program 4. Customer Experience: Advance 10 Skytrax service attributes for improvement from a 3 to a 4 ranking in the Skytrax audit 5. Financial Sustainability: Achieve debt service coverage > 1.4x and cash balance = 14 months of O&M costs 12 2022 Budget Priorities: PIGs 1. Health & Safety: Achieve 93% safety evaluation score 2. Community Meet 2022 milestones for StART Noise Working Group and Federal Policy Working Group initiatives Begin procurement for the new Part 150 Study Update by Q4 3. Customer Experience 70% of people experience a TSA line wait under 20 minutes and 90% under 30 minutes Open 11 ADR units at NSAT by Q2 Open Salty's by Q4 4. Asset Management, Capital Development and Delivery SSAT - Commission approval for advancement Q2 and Design Notice of Intent to Award Q4 Complete SAMP Estimate Review by Q1 Resources to deliver capital program budgeted and in place Q3 Complete PDD for MT Program Q4 13 2022 Budget Priorities: PIGs 5. Environment & Sustainability: Land Stewardship: Approved tree replacement and management approach in support of future development Scope 1 and 2 GHG Emissions: achieve 2022 milestones for Sustainable Fleet Plan implementation as appropriate for individual department budgets (AVM lead with AVENV support); complete NREL work to analyze long-term energy alternatives to reduce carbon emissions from the SEA central mechanical plant Scope 3 GHG Emissions, airline emissions: Advocate for SAF opt-in credits in LCFS rulemaking; continue to implement APU project and complete root-cause analysis by Q4; complete MSW-to-liquid fuels study in partnership with King County. Scope 3 GHG Emissions, GT: Progress achieved on environmental strategies as identified in 2022 GT Workplan 14 2022 Budget Priorities: PIGs 5. Environment & Sustainability (cont.): Sustainable Project Framework: Finalize guidance manual based on lessons learned from 2021 pilot project. Develop a workplan to achieve remaining Commission directives such as inclusion of social equity, operational decisions, lease agreements. Solid waste: 2022 milestones on workplan to reduce single-use plastics. [potential new solid waste target pending outcome of Director and Commission briefings this year.] 15 2022 Budget Context and Drivers Planning for passenger level at 95% of 2019 Planning for major capital program Successfully deferred many costs that would have hit 2020/2021 must address in 2022 budget Committed capital projects with major expense elements in 2022 Full costs of IAF and NSAT included in 2022 budget Costs rising in many areas, particularly payroll Remaining federal relief grants will mitigate airline rate increases Used modified zero-based budget: department budget targets based on 2021 budget and 75% of 2020 travel and training budgets. 16 Passenger Forecast Assumptions 2021 Forecast: Grow 91% vs. 2020 Down 26% vs. 2019 2022 Budget: Grow 35% vs. 2021 Down 5% vs. 2019 Overview: Domestic leisure market leading recovery Business and International recovery lagging 17 Preparing for Major Growth of Capital Program 2022 Operating budget adds resources to effectively plan and deliver growing capital program Spending forecast does not include Sustainable Airport Master Plan near term projects 18 Aviation Operating Expense Budget Changes Note: Aviation division Org Basis this chart does not include direct charges or allocations from other divisions. Increase in payroll vacancy factor to 5% Payroll $16.2M PMG Consultants $14.0M Costs tied to revenues $2.8M Contract increases/other: $5.1M 19 Summary of Proposed Budget Additions All amounts in $000 Requests Approved Category Number Amount Expense Items Musts 37 7,501 Number 247 203 WIGs 37 8,887 Amount 48,863 39,112 PIGs 35 6,296 Number of FTEs Exp for Capital Project 5 7,135 Unfreeze 42.6 36.6 New Facilities 6 3,158 New 64.0 45.0 Other 83 6,135 Total 106.6 81.6 Total 203 39,112 WIGs = Wildly important goals (top strategic priorities) PIGs = Pretty important goals (other strategic priorities) 20 Highlights of Proposed Budget Additions Amount Description in $000 Significant portions of Airline Airline Realignment 6,578 Realignment project are accounted New FTEs: 81.6 5,478 for as expense Consolidated Services Contract 4,100 Planning 1,775 Phased starts for new FTEs SAMP Environmental Review 1,500 throughout 2022 ADR PM Consultants 1,220 Air Service Incentives 975 Many continuing initiatives are re- Asset Management Program 800 approved annually to manage scope Utility Master Plan 700 STOC Furniture and Equipment 700 and cost AAAE Conference Sponsorship 650 Air service incentives are Window Cleaning 636 Pest Control Contract 627 contractual obligations Cargo Buildings Roof Coatings 563 SEA hosting AAAE conference Art Conservation 535 Cargo Building Fire Protection 500 Remaining 130 items 11,775 Total 39,112 21 Summary of Budget Requests 2022 Budget Requests (in $000's) # of Budget Request Category Requests Non- FTEs Baseline Total Recurring Health and Safety 28 11.0 1,983 1,897 3,880 Security 8 3.0 371 224 594 Employee Engagement 4 - 23 145 168 Community 8 - 220 790 1,010 Innovation and Efficiencies 14 3.0 528 244 772 Social Responsibility 1 - 0 100 100 Customer Experience 39 17.6 7,457 1,421 8,878 Environment and Sustainability 22 - 717 1,555 2,272 Financial Sustainability 9 3.0 297 1,295 1,592 Asset Management, Capital Projects, and Planning 70 44.0 4,668 15,178 19,846 2022 Budget Requests - Total Proposed 203 81.6 $ 16,264 $ 22,848 $ 39,112 2022 Budget Requests - Initial Requested 247 106.6 $ 22,256 $ 26,607 $ 48,863 22 Major Budget Requests by Strategic Priority Health & Safety Social Responsibility Pest Control contract 627 Human trafficking training 100 Cargo Building fire protection 500 Fire apparatus maint. contract 400 Customer Experience Bird & Mammal hazard contracts 330 Consolidated Cust. Serv. contract 4,100 Replace AEDs 300 Janitorial contract increases 964 3 Firefighters 155 Restore 13.6 Ops. & Maint. FTEs 916 4 Airfield operation specialists 260 Waste receptacles 412 Resiliency exercise 150 Quality Assurance program 270 Community Financial Sustainability AAAE Conference sponsorship 650 New air service incentives 975 Outside prop. garbage & veg. control 200 23 Major Budget Requests by Strategic Priority Environment & Sustainability Asset Mgmt, Capital Projects & Planning Cargo building rooftop coating 563 Expense elements of capital projects 6,894 Building energy efficiency audit 200 Maintain existing facilities/ 10 FTEs 3,816 NREL Athena pass. mode choice 125 Capital program growth/ 25 FTEs 2,916 TMA consulting contract 75 Maintain new facilities/ 9 FTEs 1,903 Planning studies 1,775 SAMP Environmental Review 1,500 24 Proposed FTEs Restore Total to 2020 Level Same FTE count as 2020, but FTEs address changing needs Proposed Budget strategically adds back FTEs in order to: Meet operational needs Service new facilities Advance key initiatives Address growing capital program Including 2021 mid-year adds: 51/102 Frozen positions restored 51.6 new positions 25 Total Airport Expense Summary Total Airport Expense Summary 2019 2020 2021 2021 2022 Incr (Decr) Proposed Change from 2020 Payroll: ($ in 000's) Actual Budget Budget Fo recast Budget $ % Contract increases Operating Expenses Ave. PFP 6% Payroll 144,051 160,340 153,293 153,183 167,505 7,165 4.5% Payroll vacancy 5% Outside Services 68,162 79,889 65,174 66,406 101,757 21,868 27.4% Utilities 18,180 21,180 20,244 19,619 21,008 (172) -0.8% 81.6 new FTEs Charges to Capital (19,874) (27,043) (22,679) (22,970) (37,815) (10,772) 39.8% Non-payroll Other Expenses 34,595 32,267 24,039 25,029 32,852 585 1.8% Project outside Total Airport Direct Charges 245,114 266,634 240,071 241,267 285,307 18,673 7.0% services Environmental Remediation Liability 15,900 2,648 2,001 2,196 985 (1,663) -62.8% Contractual Capital to Expense 2,089 - - 218 - - Total Exceptions 17,989 2,648 2,001 2,414 985 (1,663) -62.8% increases Total Airport Expenses 263,104 269,282 242,072 243,680 286,292 17,011 6.3% Corporate 65,729 77,460 69,767 70,076 78,922 1,462 1.9% P olice 22,290 26,233 23,964 23,513 27,658 1,425 5.4% 5.4% Growth over Maritime/Economic Development/Other 4,123 4,332 4,105 3,991 4,842 510 11.8% 92,141 108,025 97,836 97,580 111,422 3,397 3.1% 2020 Budget Total Charges from Other Divisions Total Operating Expenses 355,245 377,306 339,908 341,260 397,714 20,408 5.4% Actuals include pension credit. 26 Budget Summary with Grant Impacts Budget Summary 2019 2020 2021 2021 2022 Incr (Decr) Proposed Change from 2020 ($ in 000's) Actual Budget Budget Fo recast Budget $ % Operating Revenue Aeronautical Revenues 357,598 401,342 386,668 300,332 413,527 12,185 3.0% Non-Aeronautical Revenues 269,037 283,167 189,548 184,024 241,146 (42,021) -14.8% Total Operating Revenues 626,636 684,510 576,215 484,356 654,673 (29,837) -4.4% Total Operating Expenses 355,245 377,306 339,908 341,260 397,714 20,408 5.4% Improving Net Operating Income 271,390 307,203 236,308 143,095 256,959 (50,245) -16.4% Federal Relief 37,899 160,666 76,058 76,058 Bottom Line Federal Relief (Concessions) 5,355 21,419 21,419 NOI (After Federal Relief Grants) 271,390 307,203 274,207 309,116 354,435 47,232 15.4% Debt Service Coverage 1.68 1.80 1.36 2.15 1.91 0.11 6.0% Improving ADF Cash Balance - Months of O&M 10 10 12 14 14 4 40.0% Key Measures CPE 12.86 13.92 19.62 14.01 15.35 1.43 10.3% Non-Aero NOI ($ in 000s) 143,917 154,660 82,742 82,517 108,048 (46,611) -30.1% Enplaned passengers (in 000s) 25,874 26,667 18,216 19,190 24,648 (2,018) -7.6% - - - - - - Capital Expenditures (in 000s) 573,598 513,131 491,202 483,342 514,812 1,681 0.3% Actuals include pension credit. Non-Aero revenue shown including concessionaire grant reductions. 27 Non-Aero Revenue Recovery as % of 2019 Actual Comparison of Non-Aero Revenue and Enplanements 110% Parking 99% Enplanements 95% 100% 100% 90% 79% 80% 74% 70% Clubs & Lounges 87% 60% 42% 50% 40% 39% 30% 39% 20% 10% 20% 0% 2019 2020 2021 2022 Actual Actual Forecast Budget Parking Rental Car Ground Transportation Airport Dining & Retail Clubs & Lounges Enplanements 28 Non-Aero NOI Before Concession Relief Grants Non-Aeronautical NOI 2019 2020 2021 2021 2022 Incr (Decr) Proposed Change from 2020 ($ in 000's) Actual Budget Budget Fo recast Budget $ % Non-Aeronautical Revenues Public Parking 82,125 89,485 59,597 64,576 81,169 (8,316) -9.3% Rental Cars 52,567 51,149 26,880 33,612 51,011 (138) -0.3% Ground Transportation 20,765 22,299 13,628 11,482 18,306 (3,993) -17.9% Airport Dining & Retail 61,615 66,145 45,936 40,381 60,267 (5,878) -8.9% Clubs and Lounges 10,274 10,536 6,221 4,001 8,972 (1,564) -14.8% 2022 Budgeted Utilities 7,431 8,831 7,568 6,968 7,808 (1,023) -11.6% Revenues at All Other 34,262 34,722 29,717 28,358 35,032 310 0.9% Total Non-Aeronautical Revenues 269,037 283,167 189,548 189,378 262,565 (20,603) -7.3% 98% of 2019 Total Non-Aeronautical Expenses 118,286 128,508 106,806 106,861 127,510 (998) -0.8% Non-Aeronautical NOI 150,752 154,660 82,742 82,517 135,055 (19,604) -12.7% Less: CFC Surplus (6,834) - - - (5,588) (5,588) Adjusted Non-Aeronautical NOI 143,917 154,660 82,742 82,517 129,467 (25,192) -16.3% Debt Service (49,299) (33,065) (53,025) (15,935) (35,229) (2,164) 6.5% Net Cash Flow 94,619 121,595 29,717 66,583 94,238 (27,356) -22.5% Non-Aero revenue shown before Concessionaire Relief grant reductions. 29 Aeronautical Cost Drivers Impact on Aero Revenues 2020 2021 2021 2022 Change from 2020 Proposed $ in 000's Budget Budget Forecast Budget $ % IAF and NSAT add O&M 242,981 227,420 228,844 262,723 19,742 8.1% operating and Federal Relief Grants O&M - (3,500) (21,100) (8,100) (8,100) capital costs to Net O&M 242,981 223,920 207,744 254,623 11,642 4.8% airline rate base Debt Service Before Offsets 174,455 193,302 190,120 235,151 60,696 34.8% Debt Service PFC Offset (62,998) (47,549) (57,839) (79,803) (16,804) 26.7% Federal Relief Grants Debt Service - (29,399) (86,778) (44,333) (44,333) Net Debt Service 111,457 116,354 45,503 111,015 (441) -0.4% Amortization 32,326 32,681 32,624 33,739 1,413 4.4% PFCs and Grants Space Vacancy (490) (1,141) (1,063) (1,682) (1,193) 243.5% offset $61 million TSA Operating Grant and Other (1,028) (758) (759) (758) 270 -26.3% growth in debt Rate Base Revenues 385,246 371,056 284,048 396,937 11,691 3% Commercial area 16,097 15,612 16,284 16,590 493 3% service Total Aero Revenues 401,343 386,668 300,332 413,527 12,184 3% 30 Aeronautical NOI Aeronautical NOI 2019 2020 2021 2021 2022 Incr (Decr) Proposed Change from 2020 ($ in 000's) Actual Budget Budget Fo recast Budget $ % Grants and PFCs Rate Base Revenues reduce Airfield Movement Area 123,436 132,128 115,037 87,899 121,862 (10,266) -7.8% Airfield Apron Area 22,016 22,011 21,418 15,184 22,182 171 0.8% Revenue Terminal Rents 205,283 212,943 213,147 166,593 229,371 16,428 7.7% growth Federal Inspection Services (FIS) 12,321 18,162 21,454 14,373 23,522 5,359 29.5% Total Rate Base Revenues 363,057 385,245 371,056 284,048 396,937 11,691 3.0% Airfield Commercial Area 11,687 16,097 15,612 16,284 16,590 493 3.1% Subtotal before Revenue Sharing 374,744 401,342 386,668 300,332 413,527 12,185 3.0% Revenue Sharing (17,146) - - - - - Total Aeronautical Revenues 357,598 401,342 386,668 300,332 413,527 12,185 3.0% Total Aeronautical Expenses 236,959 248,799 233,102 234,400 270,205 21,406 8.6% Aeronautical NOI 120,639 152,544 153,566 65,932 143,322 (9,221) -6.0% Debt Service (110,945) (62,607) (125,747) (48,130) (114,432) (51,824) 82.8% Net Cash Flow 9,694 89,936 27,819 17,802 28,891 (61,046) -67.9% 31 2022 Operating Budget Risks Navigating uncertainty over path of recovery: Need to be prepared for activity level near 2019 Need to be ready to cut back if recovery stalls May have opportunity to shift more federal relief grants to 2022 Payroll vacancy rate of 5% included in budget No contingency in budget snow events would result in non- budgeted spending 32 Federal COVID Relief: CARES, CRRSAA & ARPA $250 CARES = $192 Concessions Grants ARPA = $154 Total = $410 $200 $166.1 American Rescue Plan Act (ARPPA) $147.1 $5.4 ($ in millions) $150 Coronavirus Response & Relief Supplemental Appropriation Act $78.3 $97.5 TBD (CRRSAA) $100 $21.4 Coronavirus Aid, Relief & $147.1 Economic Security Act (CARES) $37.4 $50 $76.1 $45.0 $0 2020 2021 2022 33 Growing Cash Balance for Greater Resiliency $800 $700 Minimum balance targets: $600 2021 - 12 months O&M $500 2022 - 14 months O&M $ in millions 2023 - 16 months O&M $400 2024 - 18 months O&M $300 $200 ADF Ending $100 Balance $- Target 2021 2022 2023 2024 2025 2026 34 Federal Relief Grants Used to Surpass Debt Service Coverage Target Variance 2022 BUD vs. 2021 in $000's 2020 Actual 2021 Forecast 2022 Budget FCST Revenues Aero 297,909 300,332 413,527 113,195 Non-aero without relief 116,473 189,379 262,565 73,186 Reflects preliminary grant use plan Concession relief (5,355) (21,419) (16,064) Total Revenues 414,382 484,356 654,673 170,317 Majority of federal relief used to O&M 329,680 341,260 397,714 (56,454) pay debt service NOI 84,702 143,096 256,959 113,863 Costs paid by grants excluded from Federal Relief Grants Non-op 43,257 31,859 9,758 (22,101) Concession Rent Relief Grants - 5,355 21,419 16,064 airline rate base, thus reducing CFC Excess (5,588) (5,588) Aero revenues Other net non-operating 5,604 2,674 2,601 (73) Available for debt service 133,562 182,984 285,149 102,165 Concessions rent relief grant is cash Debt Service flow neutral (lower operating Gross debt service (net of cap i) 249,555 287,283 316,930 (29,647) CFC offset (13,601) (14,168) (18,711) 4,543 revenues, higher grant revenues). PFC offset (36,390) (59,158) (82,258) 23,100 Federal Relief Grants DS offset (103,891) (128,807) (66,300) (62,507) Net Debt Service 95,673 85,150 149,661 64,511 Debt Service Coverage 1.40 2.15 1.91 (0.24) 35 Capital Program Will Grow In 000's Spending forecast does not include Sustainable Airport Master Plan near term projects 36 Updates on Progressing Major Capital Programs 37 In Design C-1 Building Expansion Scope: Add 4 floors to the existing 3 floor C1 Building. Includes: Airport Dining and Retail space, office space, and lounge space. Schedule: Q1 2021 Q4 2027 Design Complete Q1 2023 Early Work Packages Start Q2 2022 Full Construction Starts Q2 2023 Substantial Completion Q4 2027 38 North Main Terminal Proceeding to 30% Design Redevelopment Program Scope: Alaska Airlines is sponsoring and managing a tenant reimbursable to redevelop of their Ticketing and other support areas of the Main Terminal to improve passenger check-in, bag drop and security screening capacity. This program will be seeking full design authorization at the next Commission Meeting (10.26.2021) Schedule: Q1 2021 Q4 2024 Design Start Q3 2021 Phase 1 Construction Q1 2022 (Enabling Work) Phase 2 Construction Q4 2022 39 Concourse A Lounge At 60% Design Expansion Projects Scope: Delta Air Lines is sponsoring and managing a tenant reimbursable project to build new structure at the end of concourse A to support an expanded Club @ SEA and new Delta Sky Club. Schedule: Q2 2021 Q3 2023 40 South Satellite Renovation In PDD Development Program Scope: This project will seismically and structurally strengthen the SSAT, complete the effort of bringing all its' building systems up to date, completely replace the lower-level FIS facility, and remodel and expand the retail, dining and club space on the upper floors of the facility. Schedule: Q4 2021 2030 Design Begin Q1 2023 Construction NTP Q1 2025 Substantial Completion Q4 2029 41 In PDD Development Concourse A Duty Free Scope: Design and construct a walk-through Duty Free on the A concourse, adjacent to the new IAF exit for connecting passengers. This project will provide 11,000 sq. ft. of new Duty Free space. This project will be seeking funding to complete the Project Definition Document at the next Commission Meeting (10.26.2021) Schedule: Q2 2022 Q3 2026 PDD Completion Q2 2022 Design Begins Q3 2022 Construction Q3 2023 Completion Q3 2026 42 New/Updated Major Capital Programs 43 Main Terminal Starting PDD 2022 Improvements Program Current CIP Funding in Capital Plan: $396M Scope Includes: Smoke control and sprinkler installation, ceiling, lighting, mezzanine security improvements, restroom renovations, ceiling signage, sewer & domestic water improvements. Program Additional Funding Estimate: $404M Scope Includes: Baggage level optimization plan implementation, bag claim devices renewal and replacement, elevator renewal and replacement, new signage, updated standards/requirements, aesthetic visioning implementation, sustainability and innovation program allowances. Program Schedule Duration to 2033 Total Program Budget: $800M 44 In Planning Starting PDD 2022 Concourse Modernization: Starting PDD 2022 CHIRRP (Concourses B, C & D) Concourse HVAC Infrastructure Renewal Replacement Program Current CIP Funding in Capital Plan: $85M Scope Includes: HVAC refurbishment triggering structural improvements. Interior ceiling renewal and replacement, address outstanding code issues. Program Additional Funding Estimate: $170M Scope Includes: Lighting renewal replacement, smoke control, replacement of all ceiling mounted fixtures and signage. Scheduled program over 8 years to 2029. Planned to phase one concourse at a time. Total CHIRRP Budget: $255M 45 In Planning Utility Master Plan* Providing capital scope for utility trunklines feeding existing facilities that are exterior to our terminal complex. Anticipated CIP Funding Required Existing System Renewal and Replacement: $ 250M SAMP Near Term Projects Projected Costs: TBD SAMP Long Term Vision Projected Costs: TBD Resiliency Projects Projected Cost: TBD *Important to note that the UMP likely won't be its own program but will instead inform other programs on what utilities are needed to support. Utility Masterplan provides for trunk and mainline replacement as well as major CMP replacements 46 Begin Project Development 2022 Utility Meter Networking Regulatory Requirement Scope: Renewal and replacement of 700 end of life electric meters. Implement a software solution for energy management. Schedule: Q1 2022 Q3 2027 Budget: $35.6M Capital 47 Begin Project Development 2022 IWTP Program Regulatory Requirement Scope: Install a Pretreatment System, segregate Lagoon 3 to high and low BOD storages. Integrate the Pretreatment system to the existing Industrial Waste System. Required program to meet permit levels. Budget: $100M 48 Capital Budget 2022 - 2026 Cash Flows (Figures in $000s) 2021 2022 - 26 FCST 2022 2023 2024 2025 2026 TOTAL Mega Projects Baggage Optimization 105,610 104,000 112,000 111,800 113,000 115,000 555,800 North MT Redevelopment 6,612 38,575 93,123 122,403 89,120 167 343,388 SSAT Renovation/Renewal 1,534 1,571 26,045 34,154 140,625 121,667 324,062 C1 Building Floor Expansion 9,100 50,155 31,983 42,698 88,512 62,957 276,305 NSAT 84,602 27,347 - - - - 27,347 International Arrivals Facility 68,439 20,509 - - - - 20,509 Subtotal - Mega Projects 275,897 242,157 263,151 311,055 431,257 299,791 1,547,411 Other Capital Projects 202,890 326,204 360,407 355,766 226,757 74,666 1,343,800 SAMP Preliminary Planning / Design 2,692 8,471 31,059 54,095 60,000 49,000 202,625 Proposed New Projects 1,863 33,790 79,203 134,326 202,930 325,598 775,847 CIPs Reserves - - 12,000 23,000 33,000 43,000 111,000 Subtotal 483,342 610,622 745,820 878,242 953,944 792,055 3,980,683 CIP Cashflow Adj Reserve - (95,810) 57,486 38,324 - - - Total Proposed CIP 483,342 514,812 803,306 916,566 953,944 792,055 3,980,683 Proposing 24 projects totaling $776M spending through 2026 CIP Reserve CIPs represent around 3% of five-year capital budget Implementing CIP cash flow adjustment reserve to adjust 2022 cash flows 49 Major Projects Estimated 2022-2026 Major Projects Cost 2022 2023 2024 2025 2026 Total SSAT Renovation/Renewal 1,000,000 1,571 26,045 34,154 140,625 121,667 324,062 IAF 948,789 20,509 - - - - 20,509 Checked Bag Recap/Optimization 839,584 104,000 112,000 111,800 113,000 115,000 555,800 Main Terminal Improvement Prog 800,000 4,593 14,159 21,202 28,850 101,189 169,993 NSAT 691,916 27,347 - - - - 27,347 North MT Redevelopment 350,000 38,575 93,123 122,403 89,120 167 343,388 C1 Building Floor Expansion 340,000 50,155 31,983 42,698 88,512 62,957 276,305 Noise projects 311,316 13,771 28,885 50,135 53,487 38,105 184,383 SAMP Planning 300,000 8,471 31,059 54,095 60,000 49,000 202,625 CIPs Reserves - 12,000 23,000 33,000 43,000 111,000 Other Capital Projects 245,820 454,052 457,079 347,350 260,970 1,765,271 Total 5,581,605 514,812 803,306 916,566 953,944 792,055 3,980,683 50 Summary of Proposed New Projects Cash Flows (Figures in $000s) 2022 - 26 Justification CIP Description Cost Estimate 2021 2022 2023 2024 2025 2026 TOTAL Asset Stewardship C801266 Main Terminal Improvement Prog 800,000 536 4,593 14,159 21,202 28,850 101,189 169,993 Asset Stewardship C801265 Conc HVAC renewal & replace 255,000 20 2,537 5,680 17,434 36,258 54,229 116,138 Reserves C801267 Utility Master Plan Allowance 238,392 - - 19,000 30,000 61,000 97,000 207,000 Asset Stewardship C801234 IWTP Program 100,000 - 6,765 6,883 24,192 31,788 29,740 99,368 Asset Stewardship C801240 Utility Meter Networking 35,525 - 1,137 3,274 3,300 12,795 12,972 33,478 Safety/Security C801226 AFLD Lighting/Auto FOD Detecti 35,500 - - 593 1,251 5,690 19,211 26,745 Asset Stewardship C801280 Concourse Low Voltage Upgrades 28,350 327 2,224 10,477 13,345 1,976 - 28,022 Asset Stewardship C801256 2022 Eastside Firestation 20,000 - 5,000 5,000 5,000 5,000 - 20,000 Asset Stewardship C801225 400HZ Replacement Conc C & D 16,500 - - 838 2,298 5,301 6,875 15,312 Asset Stewardship C801231 Building 161 D Retrofit 11,313 - 717 1,881 3,713 4,394 608 11,313 Asset Stewardship C801223 DA and Condensate Sys Upgrades 9,805 - - 787 1,588 4,381 3,049 9,805 Safety/Security C801227 Airfield Snow Equipment 8,620 - 4,310 4,310 - - - 8,620 Asset Stewardship C801236 M.Terminal Exterior wall rehab 7,585 - 560 1,360 2,777 2,790 97 7,584 Safety/Security C801238 Public Access DAS Upgrade 5,600 - 510 1,717 2,962 411 - 5,600 Asset Stewardship C801230 Boiler Room Upgrades 3,410 - 461 835 1,502 612 - 3,410 Safety/Security C801235 Learning center Re-roof 3,010 - 319 678 1,525 488 - 3,010 Asset Stewardship C801224 1947 Water Main - DBB 2,263 - 764 992 506 1 - 2,263 Asset Stewardship C801239 Sanitary Pipe Replacement 2,000 - 84 133 201 621 621 1,660 Safety/Security C801237 Mid Field Checkpoints 1,800 - 247 153 852 540 7 1,799 Asset Stewardship C801233 Inform RMS Upgrade 1,300 - 975 325 - - - 1,300 Customer experience C801272 SEA Virtual Queue 1,200 480 720 720 Asset Stewardship C801271 JOC Water Tank Replace 1,100 500 600 600 Community & Environment C801232 EV Chargers for AV Fleet 932 - 92 128 678 34 - 932 Asset Stewardship C801228 AV Maintenance Lift Truck 800 - 800 - - - - 800 Asset Stewardship C801229 AVI Readers Refresh 375 - 375 - - - - 375 Total 1,590,380 1,863 33,790 79,203 134,326 202,930 325,598 775,847 51 Capital Projects- Summary Cash Flows (Figures in $000s) 2021 2022 - 26 Capital Projects CIP FCST 2022 2023 2024 2025 2026 TOTAL Construction Authorized (Status 5-6) 27% authorized Checked Bag Recap/Optimization C800612 105,610 104,000 112,000 111,800 113,000 115,000 555,800 2021-25 AFLD Pvmnt&Spprt Infr C800930 27,543 41,814 26,107 32,224 20,007 3,067 123,219 for construction Upgrades STS Train Control C801043 1,262 15,117 27,660 23,260 8,462 - 74,499 Restroom Upgrades Conc B, C, D C800697 11,482 14,545 9,793 5,621 2,193 - 32,152 31% have some NS NSAT Renov NSTS Lobbies C800556 84,602 27,347 - - - - 27,347 International Arrivals Fac-IAF C800583 68,439 20,509 - - - - 20,509 design Subtotal 298,938 223,332 175,560 172,905 143,662 118,067 833,526 Other Construction Authorized Capital Projects Multiple 127,873 110,535 56,797 37,759 17,217 7,255 229,563 authorized Total - Construction Authorized 426,811 333,867 232,357 210,664 160,879 125,322 1,063,089 Design Authorized (Status 4) North MT Redevelopment C801204 6,612 38,575 93,123 122,403 89,120 167 343,388 42% have not C1 Building Floor Expansion C800845 9,100 50,155 31,983 42,698 88,512 62,957 276,305 Apartment Sound Insulation C200096 17 4,656 16,473 32,976 41,746 30,307 126,158 been authorized MT Low Voltage Sys Upgrade C800061 3,703 21,300 18,700 17,700 16,200 5,283 79,183 Art Pool C102066 506 3,551 5,454 6,161 6,522 4,769 26,457 Planning to Other Design Authorized Capital Projects Multiple 25,839 80,852 132,287 106,653 43,636 2,356 365,784 Total - Design Authorized 45,777 199,089 298,020 328,591 285,736 105,839 1,217,275 spend an Pending Authorization (Status 2-3) SSAT Renovation/Renewal C801203 1,534 1,571 26,045 34,154 140,625 121,667 324,062 average $791 Utility Master Plan Allowance C801267 - - 19,000 30,000 61,000 97,000 207,000 Main Terminal Improvement Prog C801266 536 4,593 14,159 21,202 28,850 101,189 169,993 million per year Conc HVAC renewal & replace C801265 20 2,537 5,680 17,434 36,258 54,229 116,138 Other Pending Capital Projects Multiple 8,664 68,965 150,559 236,197 240,596 186,809 883,126 Total - Pending Authorization 10,754 77,666 215,443 338,987 507,329 560,894 1,700,319 Subtotal 483,342 610,622 745,820 878,242 953,944 792,055 3,980,683 CIP Cashflow Adj Reserve C801141 - (95,810) 57,486 38,324 - - - Grand Total 483,342 514,812 803,306 916,566 953,944 792,055 3,980,683 52 Capital Funding Plan 2022-2026 1,000,000 900,000 800,000 700,000 600,000 500,000 400,000 300,000 200,000 100,000 - $ in 000's 2022 2023 2024 2025 2026 Future ADF AIP Prior Bond PFC TSA CFC 53 Passenger Recovery Forecast Annual Change Vs. 2019 2020 -61.2% -61.2% 2021 90.5% -26.1% 2022 28.7% -4.9% 2023 4.1% -1.0% 2024 2.3% 1.3% 2025 2.5% 3.8% 2026 2.6% 6.5% Surpass 2019 passenger level by 2024 54 Financial Forecast 2022 - 2026 In $000's Actual Fore cas t Budge t Fore cas t Fore cas t Fore cas t Fore cas t 2020 2021 2022 2023 2024 2025 2026 Airline Revenue $ 297,909 $ 300,304 $ 413,527 $ 478,463 $ 532,669 $ 571,841 $ 639,553 Non-Airline Revenue (a) 116,473 184,024 241,146 279,861 295,757 311,326 335,162 Total Revenue $ 414,382 $ 484,328 $ 654,673 $ 758,324 $ 828,425 $ 883,167 $ 974,715 Operating Expense 329,680 341,260 397,714 421,003 439,423 454,391 466,340 Net Operating Income $ 84,702 $ 143,068 $ 256,958 $ 337,321 $ 389,003 $ 428,775 $ 508,375 Federal grants Non-Op Revenue 43,257 31,859 9,758 - - - - CRRSAA and ARPA concession relief - 5,354 21,419 - - - - Net Non-Operating Income/Expense 5,604 2,674 2,601 9,160 10,855 11,437 11,760 CFC Excess(b) - - (5,695) (9,582) (11,380) (13,243) (15,258) Available for Debt Service $ 133,563 $ 182,955 $ 285,042 $ 336,898 $ 388,478 $ 426,969 $ 504,876 Gross Debt Service (net of cap i) $ 249,555 $ 287,283 $ 316,930 $ 322,261 $ 362,133 $ 407,563 $ 480,529 CFC Offset (13,601) (14,168) (18,711) (24,659) (24,905) (25,134) (25,389) PFC Offset (36,390) (59,158) (82,255) (103,945) (89,085) (98,586) (101,128) Federal grants DS offset (103,891) (128,807) (66,300) - - - - Net Debt Service $ 95,673 $ 85,150 $ 149,665 $ 193,656 $ 248,144 $ 283,843 $ 354,013 Net Cash Flow $ 37,890 $ 97,805 $ 135,377 $ 143,242 $ 140,334 $ 143,127 $ 150,864 (a) $5.3M Federal grants for Concessionarie relief have been applied to reduce the 2021 revenues, and $21.4M for 2022 budget. (b) CFC collection in excess of CFC debt service/O&M is restricted and cannot be used for other revenue bond debt service 55 Financial Forecast 2022 2026 Metrics Actual Fore cas t Budge t Fore cas t Fore cas t Fore cas t Fore cas t 2020 2021 2022 2023 2024 2025 2026 Key Measures Debt Service Coverage 1.40 2.15 1.90 1.74 1.57 1.50 1.43 ADF Balance - Months of O&M 10 14 14 16 18 18 18 CPE $ 27.43 $ 14.01 $ 15.35 $ 17.34 $ 18.92 $ 19.86 $ 21.78 O&M per Enplaned Passenger $ 32.82 $ 17.78 $ 16.14 $ 16.43 $ 16.73 $ 16.88 $ 16.90 Debt per Originating Passenger $ 538 $ 244 $ 218 $ 243 $ 279 $ 313 $ 333 Activity Enplaned Passengers(000's) 10,044 19,190 24,648 25,626 26,266 26,923 27,596 Growth Rate -61% 91% 28% 4% 2% 3% 2% 56 APPENDIX AVIATION DIVISION 57 Aviation Appendix Table of Contents 1. SWOT 2. Operating Budget Explanation of Baseline Budget Changes ERL summary 2021 Budget Request detail listing FTE Reconciliation and itemized requests Non-aeronautical revenue budgets by business unit Federal relief grants use plan cost center allocations 58 STRENGTHS, WEAKNESSES, OPPORTUNITIES AND THREATS 59 2021 SWOT: SEA STRENGTHS Seattle is well positioned as an International Gateway Two high performing hub airlines with strong global alliances New Facilities: Opening IAF and NSAT will improve customer experience Employees' ability to adapt and innovate during operational disruptions, and employee engagement opportunities SEA brand , FlyHealthy@SEA, and tenant engagement strategies Federal relief replenish fund balances and augment debt service coverage 60 2021 SWOT: SEA WEAKNESSES Finances have been impacted by COVID 19 Constrained land and aging facilities resulting in suboptimal level of service for tenants and passengers Project construction activities impact operations, customer service and non- aeronautical revenues Capital Program - affordability and resources to deliver the program to meet the expected LOS Staffing challenges (employee engagement, filling key positions, safety concerns returning to the office, diversity of internal staff) Competing, changing or unplanned priorities 61 2021 SWOT: Industry/Business Context OPPORTUNITIES Regional economy remains strong, with a pent-up demand for travel Emerging Technologies to enhance customer experience , revenue and operational efficiencies : biometrics, app-based, pre-booking, and virtual queuing, etc. Future federal funding support for airports Leverage hub airline partner investments (e.g., Alaska NMTR Delta Air lounge) IAF Facility will be an attraction for other international airlines Explore prospects for new non-aeronautical revenues Expect growth through AAG alliance with oneworld 62 2021 SWOT: Industry/Business Context THREATS Pandemic uncertainties (variants, return of business travel, telework, lack of guidance on digital health passports, restrictions etc.) Airlines are in recovery mode and focus remains on cost cutting Volatile Construction Market Risk of meeting DBE, WMBE & SBE objectives Regulatory Changes and lack of agency resources Climate change and impact on airport resiliency Cyber attacks concerns (e.g., network security, ransomware, insider threats) Community Concerns (e.g., opposition to airport expansion, SAF, permit changes, biometrics) 63 BUDGET MANAGEMENT: BASELINE BUDGET CHANGES 64 Payroll Budget Up $14M over 2021 Baseline Budget includes: 6% average pay increases for Non-Represented employees Contractual pay increases for Represented employees 5% Vacancy factor (reduces expected payroll costs) 21 positions (new or unfrozen FTEs) approved during 2021 FTE Budget Requests include: 81.6 new FTEs (new or unfrozen) 65 Non-Payroll Budget Up $30M over 2021 Non - Payroll Baseline Budget ($4M) decrease: Increased AVPMG consulting costs to support Aviation capital program Contractual increases for existing contracts, some additional costs for new facilities and other expenses related to returning passenger volumes Partially offset by: $15M higher Charges to Capital (reduces Non - Payroll expense) $1M lower ERL expense Non - Payroll New Budget Requests $34M increase: Includes costs for new facilities, airline realignment and other expenses related to a growing capital program Net Non-Payroll budget increase of $30M and 34% 66 Summary of Changes in Aviation Direct Expenses 2022 Budget - Aviation Direct Expenses: $000's Payroll Increases Payroll Increase related to existing FTEs (baseline) 9,050 Proposed new FTEs (budget requests) 5,247 Total Payroll Increases 14,297 Non-Payroll Increases AVPMG consulting services (100% charged to capital) 13,970 Lower ERL expense (1,016) Higher estimated Charges to Capital (decrease to OpExp) (15,136) All other Non-Payroll changes in baseline budget 58 Net impact of Non-Payroll changes (baseline budget) (2,124) Proposed additional Non-Payroll expense (new budget requests) 33,864 Total Non-Payroll Increases 29,978 Total 2022 Budget - Aviation Direct Expense Cost Increases 44,275 67 Change in Charges to Capital 2022 Charges to Capital compared to 2021 Approved Budget: $000's Higher estimated Charges to Capital (decrease to OpExp) AVPMG incremental consulting & OH charged to Capital 12,173 AVPMG increased payroll costs charged to Capital 2,074 All other increased Aviation payroll costs charged to Capita 699 Increase in all other AV non-payroll Charges to Capital 190 Total increase in Charges to Capital 15,136 68 Cost Reductions 2022 Baseline Cost Reductions/Savings: $000's Payroll Savings (before new FTE requests) Increase in Payroll Vacancy (5.0% assumption) in 2022 Budget 6,650 Removal of eliminated FTEs (or expired Limited Duration positions) 554 Total Payroll cost reductions 7,204 Total Non-Payroll cost reductions 23 Total 2022 Baseline Cost Reductions 7,228 69 Baseline Cost Increases 2022 Baseline Cost Increases compared to 2021 Revised Budget: $000's 2022 Baseline Cost Increases continued: $000's Payroll Increases (before new FTE requests) Non-Payroll Cost Increases due to revenue growth Non-Represented Annual Increases (Pay & Benefits) 3,597 Clubs & Lounges - higher usage/increased volume 967 Represented Annual Increases (Pay & Benefits) 6,010 Credit Card usage fee increases 906 Annualized new FTEs approved in 2021 Budget 1,393 B&O tax increase 897 Add New FTEs approved in 2021 (mid-year approvals) 3,197 Total Non-Payroll Cost Increases due to revenue growth 2,770 Grade/Equity Changes 1,701 All other payroll increase/adjustments 355 Other Non-Payroll Cost Increases Total Baseline Payroll Increases 16,254 AVM contract increases 3,046 Utilities increase (rate & usage) 767 Non-Payroll Cost Increases due to growing Capital Program Restore travel to 75% of 2020 Approved Budget 1,180 AVPMG Outside Services consulting costs (100% charged to Capital) 13,970 All other Non-Payroll increases to Baseline 137 Other Non-Payroll Increases (zero based budgeting) 5,129 Baseline Cost Increases continued: Total 2022 Baseline Cost Increases 38,122 70 Environmental Remediation Liability Expense Budget Change ERL Expense 2019 2020 2021 2021 2022 2022 B v 2021 B Org Basis (in 000's) Actual Actuals Budge t Forecast Budge t $ % North Satellite Asbestos 10,744 (86) (435) - n/a Contaminated Soils 3,585 (741) 483 - n/a NSAT - ERL Expense 14,329 (827) - 47 - - n/a South Satellite SSAT - HVAC Infrastructure Upgrade 4,323 - - n/a SSAT - ERL Expense 4,323 - - - - - n/a International Arrivals Facility Asbestos (767) (61) 7 - n/a Contaminated Soils (1,092) 139 7 - n/a IAF - ERL Expense (1,860) 78 - 14 - - n/a Airport Employee Services Ctr 1,067 1,047 (1,067) -100% Baggage Optimization Phase 2 316 316 (316) -100% Phase 2 eGSE charging stations 502 202 (502) -100% Lora Lake (lake parcel) (1,066) (1,846) 55 - n/a All other RMM expense 174 234 116 759 985 869 749% Total ERL Expense 15,900 (2,361) 2,001 2,440 985 (1,016) -51% 71 BUDGET REQUESTS 72 Summary of Budget Requests 2022 Budget Requests # of Budget Request Category Requests Non- FTEs Baseline Total Recurring Health and Safety 28 11.0 1,983,180 1,896,995 3,880,175 Security 8 3.0 370,856 223,500 594,356 Employee Engagement 4 - 23,010 144,500 167,510 Community 8 - 220,000 790,250 1,010,250 Innovation and Efficiencies 14 3.0 528,493 243,929 772,422 Social Responsibility 1 - - 100,000 100,000 Customer Experience 39 17.6 7,456,892 1,420,792 8,877,684 Environment and Sustainability 22 - 717,000 1,554,695 2,271,695 Financial Sustainability 9 3.0 296,677 1,295,000 1,591,677 Asset Management, Capital Projects, and Planning 70 44.0 4,667,764 15,178,168 19,845,932 2022 Budget Requests - Total Proposed 203 81.6 $ 16,263,872 $ 22,847,829 $ 39,111,701 2022 Budget Requests - Initial Requested 247 106.6 $ 22,255,809 $ 26,606,920 $ 48,862,729 73 Budget Requests: Health and Safety Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring UPM Pest Control Contract (Western) - 627,000 - 627,000 Fire Protection and Fire Prevention - - 500,000 500,000 Fire Apparatus Maintenance Contract (additional) - - 400,000 400,000 Airfield Operations Specialists 4.0 260,489 - 260,489 Travel and Training Supplemental Funding - - 157,000 157,000 Firefighters 3.0 154,911 - 154,911 UPM Coordinator 1.0 109,345 - 109,345 Health and Maintain and Improve Safety Airport Duty Manager 1.0 83,424 - 83,424 Safety of Airport Operations Area Bunker Gear - - 98,210 98,210 Safety Compliance Specialist 1.0 68,349 - 68,349 ADA Seating STS and Respite - - 86,542 86,542 Alarm Technician 1.0 74,297 - 74,297 Airfield/Gate Striping Design Support - - 75,000 75,000 LiftNet Technical Support - 75,000 - 75,000 Overheight Warning System Installation - - 67,200 67,200 Continued on next slide 74 Budget Requests: Health and Safety, ctd. Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring Mammal Hazard Mitigation Contractor - 50,000 - 50,000 UPM Coordinator Services Contract (Avisure) - - 50,000 50,000 Enhanced Driver Training Material Development - - 48,500 48,500 Maintain and Improve Safety AOB: Hot Desk/Office Equip - - 40,058 40,058 of Airport Operations Area, Bagwell Signage - - 30,000 30,000 ctd. Stanchions Renew and Replacement - 28,565 - 28,565 Slide in Snow Sanders - - 25,500 25,500 Fire Hose - 20,000 - 20,000 Health and Privacy Screen Renewal and Replacement - - 18,985 18,985 Safety, ctd. Facility Life-Safety Public Access AED Replacement - - 300,000 300,000 Enhancements Bird Trapping Contractor - 199,300 - 199,300 Reduce Wildlife Strikes Raptor Strike Avoidance Program (RSAP) Contract - 82,500 - 82,500 Prepare for Emergencies Multi-Year Preparedness/Resiliency Exercise Support - 150,000 - 150,000 Health and Safety Total 11.0 $ 1,983,180 $ 1,896,995 $ 3,880,175 75 Budget Requests: Security Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring Electronic Technician 1.0 130,741 - 130,741 Aviation Security Compliance Coordinator 1.0 108,009 - 108,009 See Say Airport App - Annual Service / Use fee - - 127,500 127,500 Maintain and Enhance Credential Center Background Specialist 1.0 88,105 - 88,105 Security Overall Security at the Airport Cell phones for AV Sec SAC/FES/CSS teams - - 86,000 86,000 Regulatory "No Fly" monitoring contract - 24,000 - 24,000 IAF Security Lock Core Support Contract - 20,000 - 20,000 SEA Safety Act Certification Application Maintenance - - 10,000 10,000 Security Total 3.0 $ 370,856 $ 223,500 $ 594,356 76 Budget Requests: Employee Engagement 2022 Budget Requests Problem / Need / AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring 2022 Av Sec Ops Uniform - - 105,000 105,000 Employee Foster Employee Development Right Sizing accounts - 23,010 - 23,010 Engagement and Leverage Talent AVBP Team Relocation within AOB - - 23,000 23,000 Misc. Small Requests - - 16,500 16,500 Employee Engagement Total - $ 23,010 $ 144,500 $ 167,510 77 Budget Requests: Community 2022 Budget Requests Problem / Need / AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring 2022 AAAE Annual Conference Sponsorship - - 650,000 650,000 OTF Vegetation Control - 120,000 - 120,000 Promotional Hosting, OTF Dumping Control - Prevention - 80,000 - 80,000 Sponsorships and Other AMAC Sponsorship - 10,000 - 10,000 Community Promotional Hosting for Airline Executives - Promo - 10,000 - 10,000 Hosting and Employee Food Noise Sound Insulation Homeowner Handbooks - - 79,000 79,000 Airport Noise Mitigation Ground Noise Study - - 36,250 36,250 Part 150 Noise and Land Use Study Update - - 25,000 25,000 Community Total - $ 220,000 $ 790,250 $ 1,010,250 78 Budget Requests: Innovations and Efficiencies Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring Manager Airport Operations 1.0 121,428 - 121,428 Sr Operations Controller 1.0 71,422 - 71,422 Admin Assistant to COO 1.0 49,643 - 49,643 Airport Integrated Control Center planning effort - - 50,000 50,000 Keep Up with Growth of the AOB: Surface Hubs - - 37,372 37,372 Airport AV Ops Consultant Services - - 30,000 30,000 Innovation AAAE Art in the Airports - - 25,000 25,000 and AAAE supplemental contribution - - 25,000 25,000 Efficiencies Common Use Bag Sizers - - 22,805 22,805 AOB: Mobile Power Units - - 13,752 13,752 Virtual Queueing Software - 236,000 - 236,000 Passenger Processing and General Signage Procurement - 50,000 - 50,000 Safety Facial Recognition Consultant Procurement - - 15,000 15,000 Leverage Employee Innovation to Solve Business Crowdsourced Innovation Challenge Software - - 25,000 25,000 Challenges Innovation and Efficiencies Total 3.0 $ 528,493 $ 243,929 $ 772,422 79 Budget Requests: Social Responsibility 2022 Budget Requests Problem / Need / AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring Social Combat Human Trafficking Human Trafficking training - - 100,000 100,000 Responsibility Social Responsibility Total - $ - $ 100,000 $ 100,000 80 Budget Requests: Customer Experience Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring ACCS Contract - VIP Hospitality - 4,100,000 - 4,100,000 Cruise Transportation Coordinators 2.8 256,447 - 256,447 Language Line (Interpretive Services) - Budget Increas - - 140,000 140,000 Pathfinders (Airport Customer Svc Rep) 2.0 105,008 - 105,008 Realign SSAT and A glass Walls Post IAF - - 131,873 131,873 Airport Duty Manager - Terminal 1.0 86,964 - 86,964 Sr. Sign Grphcs Dsgn Spec 1.0 73,870 - 73,870 Landside Supervisor 1.0 70,902 - 70,902 Customer Ground Transportation Controller 1.0 48,435 - 48,435 Processing Passengers Experience Parking Cashiers 1.0 46,460 - 46,460 Laborer Parking/Fueler Cleaner 1.0 49,255 - 49,255 Prospect - Wheelchair Assistance - 55,000 - 55,000 Seasonal Bus Drivers 1.8 54,582 - 54,582 Regulatory and Informational Signage Consultant - - 50,000 50,000 Accessibility Customer Service Elevation - 40,000 - 40,000 Additional stanchions for Rental Car queueing - - 30,000 30,000 Flight Information Display Design - - 25,000 25,000 Transoft Solutions Maintenance Fees - 3,000 - 3,000 Continued on next slide 81 Budget Requests: Customer Experience, ctd. Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring Airport wide window cleaning budget reinstatement - 636,000 - 636,000 Standard waste receptacle purchase - - 412,300 412,300 Zone 1 Contract price increase - 499,000 - 499,000 Zone 3 contract price increase - 465,000 - 465,000 Smart Restroom technology subscription - - 140,000 140,000 Customer Facilities Cleanliness and Experience, Aviation Field Technician 1.0 100,364 - 100,364 Appearance ctd. Painter 1.0 99,067 - 99,067 SEA Restroom Digital Signage - - 100,000 100,000 AV F&I Intermediate Engineer 1.0 65,993 - 65,993 DC Inventory Specialist 1.0 36,591 - 36,591 NW CASCADE - Honey Buckets restrooms cell phone - 13,000 - 13,000 lot Continued on next slide 82 Budget Requests: Customer Experience, ctd. Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring QA Program - New Budget Request - 270,000 - 270,000 Replace Food Court Seating - - 242,656 242,656 Customer Communications Manager 1.0 98,549 - 98,549 Seating Replacement - - 83,963 83,963 Strategic Customer Virtual Concierge Pilot Program - - 65,000 65,000 Customer Experience Improvements Experience, Live Music Program - ADR - 60,000 - 60,000 ctd. Temporary Art Exhibition - 50,000 - 50,000 Baseline Restoration, Terminal Education - 35,000 - 35,000 Rightsizing Employee Expenses - Upgrades - 8,406 - 8,406 Host Targeted Training to Deliver Exceptional Customer Service Training - 30,000 - 30,000 Customer Service Customer Experience Total 17.6 $ 7,456,892 $ 1,420,792 $ 8,877,684 83 Budget Requests: Environment & Sustainability 2022 Budget Requests Problem / Need / AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring Building Energy Efficiency Audit - - 200,000 200,000 NREL Athena Passenger Mode Choice Model - - 125,000 125,000 100% Renewable Diesel - 80,000 - 80,000 Baseline Restoration, Land Stewardship Program - 75,000 - 75,000 Transportation Mgmt Assoc Consulting Contract - - 75,000 75,000 PFAS, Ongoing Investigations & Planning - - 60,000 60,000 Environment Be the Greenest and Most Land Stewardship Goals and Development Standards - - 45,000 45,000 and Energy-Efficient Port in North IWTP O&M manual - - 30,000 30,000 Sustainability America Sustainable Project Framework Support - - 25,000 25,000 Baker Tank Deicer Rental Storage - 24,000 - 24,000 Baseline Restoration, Green Building Support - 20,000 - 20,000 Baseline Restoration, Recycling Program Support - 20,000 - 20,000 Digital Transit Ticket Pilot Program - - 20,000 20,000 Zonar installation - - 19,695 19,695 Zonar app - 8,000 - 8,000 Continued on next slide 84 Budget Requests: Environment & Sustainability, ctd. Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring Cargo Rooftop Coatings to Prevent Release of Zinc in - - 563,000 563,000 Stormwater International Waste Handling and Disposal - 290,000 - 290,000 Environment Baseline: Compliance & Support: SEPA/NEPA - 200,000 - 200,000 and Consultant Support to non-SAMP projects Environmental Compliance Sustainability, SAMP Critical Areas Permitting & Mitigation - - 165,000 165,000 ctd. Final Mitigation Performance Monitoring for - - 150,000 150,000 Portions of the 1997 Master Plan Update Flight Corridor Safety Program Restoration - - 60,000 60,000 Salmon Safe Recertification - - 17,000 17,000 Environment and Sustainability Total - $ 717,000 $ 1,554,695 $ 2,271,695 85 Budget Requests: Financial Sustainability Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring Air Service Development 2022 New Air Service Incentives - - 975,000 975,000 Financial Consulting - SLOA_WJ Advisors - - 100,000 100,000 GT Consultant for On-Demand Pilot Program - - 100,000 100,000 Keep Airline Costs Lease Administration Supervisor 1.0 91,047 - 91,047 Financial Competitive Through RCF Small Operator Improvements - - 70,000 70,000 Sustainability Increased Non-Aeronautical Revenues and Improved Rightsizing of budget for AV F&B - 9,017 - 9,017 Business Processes Senior Financial Analyst AV 1.0 95,357 - 95,357 TNC trip tracking module upgrade to Gatekeeper - - 50,000 50,000 Yield Management Analyst 1.0 101,256 - 101,256 Financial Sustainability Total 3.0 $ 296,677 $ 1,295,000 $ 1,591,677 86 Budget Requests: Asset Management, Capital Projects, and Planning Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring Airline Realignment - - 6,578,019 6,578,019 On-Call Planning - - 1,775,000 1,775,000 ADR Onsite Consultant - - 1,220,000 1,220,000 Asset Management Program Development - - 800,000 800,000 STOC Building Furniture and Equipment Acquisition - - 700,000 700,000 Utility Master Plan - - 700,000 700,000 Operating Engineers 4.0 414,410 - 414,410 Asset A12A Jet Bridge TRA - - 315,849 315,849 Management, Meet the Maintenance Wiremen 3.0 312,877 - 312,877 Capital Needs and Standards of the Siemens DDC Contract Increase - 270,000 - 270,000 Projects, and Existing Facilities Small Works Construction Services - 250,000 - 250,000 Planning Webb Baggage support contract - 200,000 - 200,000 Park Assist Agreement - 190,000 - 190,000 IAF Elevator Escalator and Moving walkway - 160,000 - 160,000 Chiller Repair & Maintenance Contract Increase - 150,000 - 150,000 Planning funds for Emergency Radio System In- - - 150,000 150,000 Building Coverage Program Operating Engineers 2.0 138,137 - 138,137 Carpenters 2.0 137,466 - 137,466 Continued on next slide 87 Budget Requests: Asset Management, Capital Projects, and Planning, ctd. Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring Bldg 196B Demolition - - 135,000 135,000 2022 Airfield Pavement Management Program (APMP) - - 134,400 134,400 Senior Manager, AV Planning 1.0 125,450 - 125,450 SafeDock Maintenance Service Agreement - 121,540 - 121,540 Baggage Operation Systems Supervisor 1.0 118,127 - 118,127 ADR Consultant - 113,000 - 113,000 Asset IAF Biohazard Containers in Restrooms - - 110,300 110,300 Management, Meet the Maintenance Shared Tenant Telecom Services - - 110,000 110,000 Capital Needs and Standards of the Biometric Air Exit Vendor Support - 107,500 - 107,500 Projects, and Existing Facilities, ctd. Chiller 6 Repair - - 100,000 100,000 Automated Control Specialist 1.0 99,780 - 99,780 Planning, ctd. Wiremen 2.0 89,672 - 89,672 Utility Worker Electrical 1.0 88,454 - 88,454 Baggage Handling System Asst. Manager 1.0 85,181 - 85,181 Capital Project Manager III 5.0 85,031 - 85,031 AVM CIP Exp Proj Liaison 1.0 74,411 - 74,411 Maintenance Plan/Coor AV 1.0 74,134 - 74,134 AV F&I Architect 1.0 71,992 - 71,992 Continued on next slide 88 Budget Requests: Asset Management, Capital Projects, and Planning, ctd. Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring AV F&I Engineer - Communications 1.0 71,992 - 71,992 Utility Critical Spares and Repairs - 70,000 - 70,000 Restore Budget for utility vehicle replacements - 63,000 - 63,000 Replace CUSE Equipment - 61,000 - 61,000 ATR Consultant - SD#2 Bus & Op Coordination - - 50,000 50,000 Internal Audit Recommended Software - 50,000 - 50,000 Asset STS Materials One-Time Purchase - - 50,000 50,000 Management, Support EGSE Equipment - 50,000 - 50,000 Meet the Maintenance International Arrivals Facility Landscape Maintenance Capital Needs and Standards of the - 50,000 - 50,000 & External Service Areas Projects, and Existing Facilities, ctd. System Training - - 50,000 50,000 Planning, ctd. Sr Administrative Assistant 1.0 39,657 - 39,657 Runway Closure Lights (X lights) 3 each - - 39,600 39,600 VMS Signs, 3 each - - 39,000 39,000 Jr Controller 2.0 35,439 - 35,439 Baggage Handling Control System Technical Support - 34,500 - 34,500 Project Controls Technician 1.0 33,054 - 33,054 Dam Safety Sheet Piling Inspection - - 30,000 30,000 Continued on next slide 89 Budget Requests: Asset Management, Capital Projects, and Planning, ctd. Problem / Need / 2022 Budget Requests AV Priority Solution Opportunity Non- FTEs Baseline Total Recurring Bldg 196 Complex Maintenance - 30,000 - 30,000 Estimator 1.0 25,135 - 25,135 Program Controls Support Supervisor 1.0 22,716 - 22,716 OTF Title Reports - 20,000 - 20,000 Meet the Maintenance Capital Project Manager I 2.0 16,401 - 16,401 Needs and Standards of the Assistant Project Manager 2.0 16,050 - 16,050 Asset Existing Facilities, ctd. Capital Project Manager IV 1.0 14,110 - 14,110 Sr. Project Controller 1.0 13,127 - 13,127 Management, Doc Controls Coordinator 1.0 10,338 - 10,338 Capital AAAC & SLOA V Catering - - 6,000 6,000 Projects, and Consultant Support for PM and Controls Services - - (0) (0) Planning, ctd. Complete the Sustainable SAMP NTP Environmental Review - - 1,500,000 1,500,000 Airport Master Plan (SAMP) 2022 Art Conservation - - 535,000 535,000 Maintain Airport Art Art Technician 1.0 97,275 - 97,275 One-time Art Consultant in lieu of Art Manager position - - 50,000 50,000 Implement Operational ORAT Mgr 2.0 248,324 - 248,324 Readiness and Airport ORAT Specialist 1.0 118,483 - 118,483 Asset Management, Capital Projects, and Planning Total 44.0 $ 4,667,764 $ 15,178,168 $ 19,845,932 90 Planning Studies Detail On-Call Planning Amount Description STS Long-Term Planning $750,000 Additional expense funded planning required to complete the STS Long-Term Planning Study that will be initiated in Q4 2021. CRDC/Load Dock Study $300,000 Detailed evaluation of the existing load dock area activity, capacity and space requirements; and the location and operation of a potential Centralized Receiving and Distribution Center. GTAP Eastside $75,000 Placeholder for potential study to improve airport access for eastside air passengers (TBD through additional stakeholder outreach in 2021 and early 2022). GIS Assessment & Imp Plan $150,000 Identifies potential improvements in data organization and data flows to increase planning, design, and operational efficiency. TOTAL $1,275,000 CAPITAL Programs Signage and Wayfinding $150,000 The Signage and Wayfinding Master Plan (SWMP) has been completed and now requires an Implementation Plan implementation plan to provide the most efficient and cost-effective way to deliver it. This implementation plan will provide for GIS mapping for existing signage inventory and new signage relationship mapping. The plan will result in a coherent and scheduled program that aligns signage work with existing and future capital projects, bundling work as necessary or developing stand-alone installations. This plan will also provide estimates for the packages. Connectivity to North $350,000 Advanced planning conducted in 2021 to refine the SAMP North Gates concept included a preliminary Gates assessment of a bridge and a tunnel pedestrian connection between the North Satellite and the North Gates. The objective of this work was to understand, at a very high level, the vertical circulation and space requirement impacts to the North Gates under each option in order to develop blocking and stacking diagrams for concourse alternatives. Prior to launching into a capital funded preliminary design of the North Gates in Q3 2022, additional study is needed to fully develop and evaluate the bridge and tunnel options across a broader range of criteria in order to determine a recommended alternative. TOTAL $500,000 91 FTE SUMMARY AND DETAILED REQUESTS 92 2022 FTE Reconciliation 2022 Proposed Budget FTEs F TEs % 2021 Approved Budget - funded FTEs 1,144.40 2021 Changes in FTEs during the year 2021 mid-year FTE additions - new FTEs 6.00 2021 mid-year FTE additions - unfreeze FTEs 15.00 2021 Mid-year Changes in FTEs 21.00 1.8% FTEs in 2022 Baseline Budget BEFORE Budget Requests 1,165.40 Proposed New FTEs in 2022 Budget: Unfreeze existing vacant FTEs for hiring 36.60 New FTEs - strategic functions 45.00 Proposed Increase in 2022 Budget FTEs 81.60 7.1% FTEs in Proposed Aviation 2022 Budget 1,247.00 9.0% Note: above incremental 2022 FTE percent changes compared to 2021 Approved Budget 2022 Proposed FTEs compared to 2020 Approved Budget FTEs 1,246.74 0.0% 93 New FTE Requests Itemization AV Priority Purpose / Outcome FTEs Health and 11 New Positions: 4 Airfield Operations Specialists; 3 Firefighters; 1 Airport Duty Manager; 11.0 Safety 1 Alarm Tech; 1 Safety Compliance Specialist; 1 Unified Pest Management Coord Unfreezing of 2 positions: 1 Electronic Tech; 1 Credential Center Background Specialist Security 3.0 1 New Position: 1 Aviation Security Compliance Coordinator Innovation and Unfreezing of 2 positions: 1 Sr Operations Controller; 1 Admin Assistant to the COO 3.0 Efficiencies 1 New Position: 1 Manager Airport Operations Unfreezing of 15.6 FTEs: 2.8 Cruise Transportation Coords; 2 Pathfinders; 1.8 Seasonal Bus Drivers; 1 Landside Spvr; 1 Parking Cashier; 1 Ground Transp Controller; 1 Airport Duty Customer Manager; 1 F&I Intermediate Engineer; 1 Sr. Sign Graphics Design Specialist; 1 Painter; 1 17.6 Experience Aviation Field Tech; 1 Laborer Parking/Fueler Cleaner 2 New Positions: 1 Customer Communications Mgr; 1 DC Inventory Specialist Financial Unfreezing of 1 position: 1 Yield Management Analyst 3.0 Sustainability 2 New Positions: 1 Lease Administration Supervisor; 1 Senior Financial Analyst Unfreezing of 16 position: 4 Operating Engineers; 3 Wiremen; 2 Carpenters; 1 Sr Mgr, AV Planning; 1 AV F&I Engineer - Communications; 1 AV F&I Architect; 1 Maint Plan/Coord; 1 Asset AVM CIP Exp Project Liaison; 1 Utility Worker Electrical; 1 Baggage Operation System Spvr Management, 28 New Positions: 5 Capital Project Mgr III; 2 ORAT Mgrs; 2 Assistant Project Mgrs; 2 Capital 44.0 Capital Project Mgrs; 2 Jr Controllers; 2 Wiremen; 2 Operating Engineers; 1 ORAT Specialist; Projects, and 1 Art Technician; 1 Capital Project Mgr IV; 1 Doc Controls Coordinator; 1 Estimator; 1 Planning Program Controls Support Spvr; 1 Project Controls Tech; 1 Sr Admin Assistant; 1 Sr Project Controller; 1 Baggage Handling System Asst. Mgr.; 1 Automated Control Specialist Total 81.6 94 Status of FTEs Frozen in 2021 Budget 2022 Budget Status: Positions Frozen in the 2021 Budget Unfreeze FTEs approved 2021 mid-year 15.0 Unfreeze FTEs requested in 2022 Budget 36.6 Frozen FTEs remaining frozen & unfunded in 2022 Budget 19.2 Frozen FTEs permanently eliminated 31.5 Total Positions that were Frozen in the 2021 Budget: 102.3 95 AERONAUTICAL BUSINESS 96 Aeronautical Business Revenues defined by cost recovery formulas in Signatory Lease and Operating Agreement (SLOA IV) O&M and capital costs included in airline rate bases As travel continues to recover this year and next, improvement in passenger levels and other airport activity will help manage costs and rates to the airlines Application of Federal Relief Grants and PFCs will help manage the revenue requirement, and therefore airline rates CPE increasing in 2022 moderately compared to 2021 Forecast 97 Aeronautical NOI Aeronautical NOI 2019 2020 2021 2021 2022 Incr (Decr) Proposed Change from 2020 ($ in 000's) Actual Budget Budget Fo recast Budget $ % Rate Base Revenues Airfield Movement Area 123,436 132,128 115,037 87,899 121,862 (10,266) -7.8% Airfield Apron Area 22,016 22,011 21,418 15,184 22,182 171 0.8% Terminal Rents 205,283 212,943 213,147 166,593 229,371 16,428 7.7% Federal Inspection Services (FIS) 12,321 18,162 21,454 14,373 23,522 5,359 29.5% Total Rate Base Revenues 363,057 385,245 371,056 284,048 396,937 11,691 3.0% Airfield Commercial Area 11,687 16,097 15,612 16,284 16,590 493 3.1% Subtotal before Revenue Sharing 374,744 401,342 386,668 300,332 413,527 12,185 3.0% Revenue Sharing (17,146) - - - - - Total Aeronautical Revenues 357,598 401,342 386,668 300,332 413,527 12,185 3.0% Total Aeronautical Expenses 236,959 248,799 233,102 234,400 270,205 21,406 8.6% Aeronautical NOI 120,639 152,544 153,566 65,932 143,322 (9,221) -6.0% Debt Service (110,945) (62,607) (125,747) (48,130) (114,432) (51,824) 82.8% Net Cash Flow 9,694 89,936 27,819 17,802 28,891 (61,046) -67.9% 98 NON-AERONAUTICAL BUSINESS 99 Non-Aero Revenue Airport Dining & Retail activity expected to stabilize in 2022, when passenger volumes are forecasted to return to near 2019 levels. Slower ADR revenue recovery in 2021 reflects continued labor shortages which has impacted concessionaire ability to serve growing passenger volumes. Parking revenue - demand for close in parking continues to outpace the recovery of passenger volumes, indicating a continued customer preference toward driving to and parking at the airport, rather than other ride-share transportation options. Rental Car revenue has remained high in 2021 despite lower activity levels due to high car rental rates due to diminished fleet sizes across the industry. Rental car revenue is expected to stabilize and fleet constraints largely resolved in 2022. Ground Transportation GT trips have been impacted in 2020 & 2021 by both the decline in passengers and a shift in customer preference away from share-ride transportation options. Demand for TNCs and on-demand taxi operations are expected to recover at a slower rate than enplanements in 2022. Commercial properties In-flight Kitchen revenue impacted in proportion with decline in passengers. Other space rent not impacted by decline in passenger volume. Airport clubs & lounges both port-owned lounges are open and operating, as of mid-2021. Resumed operations include continued COVID safety protocols. Slower recovery in lounge revenue reflects the slower recovery of international passenger volumes, partially offset by higher demand for lounge access from domestic travelers. 100 Non-Aero NOI Before Concessionaire Relief Grants Non-Aeronautical NOI 2019 2020 2021 2021 2022 Incr (Decr) Proposed Change from 2020 ($ in 000's) Actual Budget Budget Fo recast Budget $ % Non-Aeronautical Revenues Public Parking 82,125 89,485 59,597 64,576 81,169 (8,316) -9.3% Rental Cars 52,567 51,149 26,880 33,612 51,011 (138) -0.3% Ground Transportation 20,765 22,299 13,628 11,482 18,306 (3,993) -17.9% Airport Dining & Retail 61,615 66,145 45,936 40,381 60,267 (5,878) -8.9% Clubs and Lounges 10,274 10,536 6,221 4,001 8,972 (1,564) -14.8% Utilities 7,431 8,831 7,568 6,968 7,808 (1,023) -11.6% Employee Parking 10,438 10,137 9,688 9,136 10,472 335 3.3% Tenant Marketing 1,273 1,375 969 870 1,358 (17) -1.2% Commercial Properties 15,773 16,660 13,713 12,370 15,540 (1,120) -6.7% Non-Airline Terminal Leased Space 6,398 5,700 5,248 5,882 7,329 1,629 28.6% AOB Conference Center 462 360 - - 80 (280) -77.8% Other (82) 489 100 100 253 (236) -48.3% All Other 34,262 34,722 29,717 28,358 35,032 310 0.9% Total Non-Aeronautical Revenues 269,037 283,167 189,548 189,378 262,565 (20,603) -7.3% Total Non-Aeronautical Expenses 118,286 128,508 106,806 106,861 127,510 (998) -0.8% Non-Aeronautical NOI 150,752 154,660 82,742 82,517 135,055 (19,604) -12.7% Less: CFC Surplus (6,834) - - - (5,588) (5,588) Adjusted Non-Aeronautical NOI 143,917 154,660 82,742 82,517 129,467 (25,192) -16.3% Debt Service (49,299) (33,065) (53,025) (15,935) (35,229) (2,164) 6.5% Net Cash Flow 94,619 121,595 29,717 66,583 94,238 (27,356) -22.5% Non-Aero revenue shown before Concessionaire Relief grant reductions. 101 Non-Aero Revenue Recovery as % of 2019 Actual Comparison of Non-Aero Revenue and Enplanements 110% Parking 99% Enplanements 95% 100% 100% 90% 79% 80% 74% 70% Clubs & Lounges 87% 60% 42% 50% 40% 39% 30% 39% 20% 10% 20% 0% 2019 2020 2021 2022 Actual Actual Forecast Budget Parking Rental Car Ground Transportation Airport Dining & Retail Clubs & Lounges Enplanements 102 Parking Revenue & O&D Enplanements as % of 2019 Actuals 110.0% Parking Revenue, 99.7% Parking Overview: 100.0% 100.0% 90.0% 79.3% Public Parking revenue 80.0% O&D Enplanements, 95 .0% recovery performing 70.0% better than change in 74.0% 60.0% passenger volumes 40.4% 50.0% Doug Fox (offsite lot) recovering inline with 40.0% O&D enplanements. 30.0% 35.4% 20.0% 10.0% 0.0% 2019 Actual 2020 Actual 2021 Forecast 2022 Budget O&D Enplanements Parking Revenue 103 Public Parking Public Parking - Revenue Detail 2019 2020 2021 2021 2022 Incr (Decr) Proposed Change from 2019 $ in 000's Actual Actual Budget Forecast Budget $ % Parking Garage Revenue to Port General Parking/Terminal Direct 73,562 27,157 48,332 47,761 61,885 (11,677) -15.9% Prebooking 217 2,935 5,570 11,968 13,200 12,983 5990.2% Premier Corporate Parking 1,415 449 850 - - (1,415) -100.0% Revenue to Port - General Parking 75,194 30,540 54,752 59,729 75,085 (109) -0.1% Other Garage Revenue Passport Parking Program 3,582 2,738 2,790 2,497 2,910 (672) -18.8% Total Parking Garage Revenue 78,776 33,278 57,542 62,226 77,995 (781) -1.0% Other Parking Revenue Concession Rent - Doug Fox off-site parking 3,292 1,186 2,037 2,518 3,156 (136) -4.1% All Other Parking Revenue 56 37 18 24 18 (38) -68.1% Total Parking Revenue 82,125 34,501 59,597 64,767 81,169 (956) -1.2% O&D Enplanements 18,163 6,428 12,387 13,433 17,254 (910) -5.0% 104 Public Parking Metrics Public Parking Revenue Metrics 2019 2020 2021 2021 2022 Incr (Decr) Proposed Change from 2019 in 000's Actual Actual Budget Fo recast Budget $ % Total Enplanements 25,874 10,044 18,216 19,190 24,648 (1,225) -4.7% O&D % 70.2% 64.0% 68.0% 70.0% 70.0% -0.2% -0.3% O&D Enplanements 18,163 6,428 12,387 13,433 17,254 (910) -5.0% Revenue per O&D Enplanement Metrics General Parking/Pre-Book/Premier Corporate 4.14 4.75 4.42 4.45 4.35 0.21 5.1% Passport Parking Program 0.20 0.43 0.23 0.19 0.17 (0.03) -14.5% Total Garage Revenue per O&D Enplanement 4.34 5.18 4.65 4.63 4.52 0.18 4.2% Concession Rent - Doug Fox off-site parking 0.18 0.18 0.16 0.19 0.18 0.00 0.9% All Other Parking Revenue 0.00 0.01 0.00 0.00 0.00 (0.00) -66.4% Total Parking per O&D Enplanement $ 4.52 $ 5.37 $ 4.81 $ 4.82 $ 4.70 $ 0.18 4.0% 105 Rental Car Key Metrics as % compared to 2019 Actuals 142% 98% 100% 84% 140% 108% Average Ti cket Price 120% 102% 80% 95% 100% 60% 74% 38% 80% T otal 40% 60% Transa ctions 92% 59% 20% 35% 40% 20% 37% 0% 2019 Actual 2020 Actual 2021 Forecast 2022 Budget 0% 2019 Actual 2020 Actual 2021 Forecast 2022 Budget O&D Enplanements Concession Revenue Total Transactions Average Ticket Average Length of Stay Transactions/O&D Enplanements Rental Car concession fee revenue similarly following enplanement recovery pattern Volatility in key metrics that impact Rental Car revenue Average Ticket Price driven higher by shortages in rental vehicles and Transactions conversely impacted. 106 Rental Cars Rental Car - Revenue Detail 2019 2020 2021 2021 2022 Incr (Decr) Proposed Change from 2019 $ in 000's Actual Actual Budget Forecast Budget $ % Total Enplanements 25,874 10,044 18,216 19,190 24,648 (1,225) -4.7% O&D % 70.2% 64.0% 68.0% 70.0% 70.0% -0.2% -0.3% O&D Enplanements 18,163 6,428 12,387 13,433 17,254 (910) -5.0% Gross Sales by Operators 328,156 122,372 205,160 275,625 323,500 (4,656) -1.4% Total Transactions 1,414 519 892 838 1,294 (120) -8.5% Average Ticket $232.06 $235.57 $ 230.00 $ 328.86 $ 250.00 $17.94 7.7% Average Length of Stay 4.49 4.93 4.60 4.86 4.65 0.16 3.5% Transactions/O&D Enplanements 7.69% 8.08% 7.20% 6.24% 7.50% -0.19% -2.4% CFC Revenue Summary Total Transaction Days 6,356 2,560 4,103 4,078 6,017 (339) -5.3% CFC Rate per Transaction Day $6.00 $6.00 $6.50 $6.50 $6.50 $0.50 8.3% Total CFC Revenue 38,128 15,362 26,670 26,504 39,111 982 2.6% Debt Service Reserve Requirement (23,655) (24,019) (24,153) (24,273) (24,516) (861) 3.6% Residual - CFC Operating Revenue 15,773 - 2,501 2,231 14,595 (1,179) -7.5% 2019 2020 2021 2021 2022 Incr (Decr) Rental Car - Revenue Summary Proposed Change from 2019 $ in 000's Actual Actual Budget Forecast Budget $ % RCF Concession Revenue to Port 32,870 12,531 20,516 27,562 32,354 (516) -1.6% Residual - CFC Operating Revenue: 15,773 - 2,501 2,231 14,593 (1,180) -7.5% Land Rent/Space Rent/Other 3,924 4,106 3,863 4,055 4,064 140 3.6% Total Rental Cars Operating Revenue 52,567 16,637 26,880 33,848 51,011 (1,556) -3.0% 107 Ground Transportation GT Trips & O&D Enplanements as % of 2019 Actuals GT Trip Totals 120% 5,000 O&D Enplanements, 95% 4,808 4,500 100% All Other GT Operators, 4,000 74% 83% 80% 3,500 TNC Total, 3,066 65% TNC To tal, 64% 3,000 60% 46% 41% 2,500 1,975 35% 1,427 40% On Demand Taxis, 56% 30% In 000's of trips 2,000 42% 1,453 All Other GT Operators, 1,208 1,500 20% 940 24% 1,000 616 674 On Demand Taxis, 0% 500 258 2019 Actual 2020 Actual 2021 Forecast 2022 Budget 150 - TNC Total On Demand Taxis 2019 Actual 2020 Actual 2021 Forecast 2022 Budget All Other GT Operators O&D Enplanements TNC Total On Demand Taxis All Other GT Operators Trips for all Ground Transportation operator types have not recovered as fast as enplanements as a shift to Public Parking is still holding. Passenger preference appears to be shifted away from shared ride alternatives. Trip volume will be closely monitored to determine if demand increases as passenger volume recovers. TNC remains highest trip activity within GT operator types. 108 Ground Transportation Ground Transportation - Revenue Detail 2019 2020 2021 2021 2022 Incr (Decr) Proposed Change from 2019 $ in 000's Actual Actual Budget Fo recast Budget $ % Ground Transportation Revenues TNC Drop-offs - - - 2,095 5,057 5,057 N/A TNC Pick-ups 12,982 4,032 8,700 5,433 8,283 (4,699) -36.2% TNC Total 12,982 4,032 8,700 7,528 13,340 358 2.8% On Demand Taxis 3,578 857 1,851 1,550 2,070 (1,507) -42.1% On Demand Limos 837 371 - - - (837) -100.0% Belled In Taxis (Annual Permit) 27 12 19 10 15 (12) -45.1% Pre-Arranged Limos (Annual Permit) 611 209 516 401 337 (274) -44.8% Courtesy Cars (cost recovery) 2,019 877 2,160 1,821 2,121 103 5.1% Airporters 57 22 65 53 62 6 10.0% Charter 229 27 54 31 438 209 91.1% Parcel Carriers 33 29 50 59 50 17 51.3% Shared Ride vehicles 99 8 19 1 20 (79) -79.8% All other Operators (cost recovery) 418 86 188 86 570 152 36.4% Other Misc Revenues 293 113 194 63 103 (190) -64.8% Total GT Revenue 20,765 6,557 13,628 11,516 18,558 (2,207) -10.6% O&D Enplanements 18,163 6,428 12,387 13,433 17,254 (910) -5.0% 109 Ground Transportation Activity & Metrics GT Trip Activity & Metrics 2019 2020 2021 2021 2022 Incr (Decr) Proposed Change from 2019 in 000's Actual Actual Budget Fo recast Budget $ % Ground Transportation Trips TNC Drop-offs 2,704 787 - 1,070 1,685 (1,019) -37.7% TNC Pick-ups 2,103 640 1,450 905 1,380 (723) -34.4% TNC Total 4,808 1,427 1,450 1,975 3,066 (1,742) -36.2% On Demand Taxis 616 150 309 258 345 (271) -44.0% On Demand Limos 65 12 - - - (65) -100.0% Belled In Taxis (Annual Permit) 13 2 5 3 4 (9) -69.5% Pre-Arranged Limos (Annual Permit) 65 87 192 149 125 60 92.0% Courtesy Cars (cost recovery) 1,236 557 900 771 1,050 (186) -15.0% All other Operators (cost recovery) 74 16 27 17 29 (44) -60.1% Total GT Trip Activity 6,876 2,251 2,882 3,173 4,619 (2,257) -32.8% Total Enplanements 25,874 10,044 18,216 19,190 24,648 (1,225) -4.7% O&D % 70.2% 64.0% 68.0% 70.0% 70.0% -0.2% -0.3% O&D Enplanements 18,163 6,428 12,387 13,433 17,254 (910) -5.0% Trips per O&D Enplanement TNC Drop-offs 14.9% 12.2% 0.0% 8.0% 9.8% -5.1% -34.4% TNC Pick-ups 11.6% 10.0% 11.7% 6.7% 8.0% -3.6% -30.9% TNC Total 26.5% 22.2% 11.7% 14.7% 17.8% -8.7% -32.9% T axi 3.4% 2.3% 2.5% 1.9% 2.0% -1.4% -41.0% All other 8.0% 10.5% 9.1% 7.0% 7.0% -1.0% -12.4% Total Trips per O&D Enplanement 37.9% 35.0% 23.3% 23.6% 26.8% -11.1% -29.3% 110 On-Demand Taxi Income On-Demand Taxi Income 2019 2020 2021 2021 2022 Incr (Decr) Proposed Change from 2019 On-Demand Taxi Overview: $ in 000's Actual Actual Budget Forecast Budget $ % Income Revenue 3,578 857 1,851 1,550 2,070 (1,507) -42.1% Comparison 2022 Budget to 2019 Actuals Operating Expense (3,110) (3,112) (3,242) (3,033) (3,228) (119) 3.8% NOI 363 (2,255) (1,391) (1,484) (1,158) (1,522) -418.7% Revenue decreased -42.1% Asset Ammortization (104) (194) (283) (266) (270) (165) 158.5% Total Expenses increased 8.8% EBIT 259 (2,449) (1,673) (1,750) (1,428) (1,687) -651.1% Net loss of ($1.4M) anticipated in 2022 Activity Detail O&D Enplanements 18,163 6,428 12,387 13,392 17,254 (910) -5.0% On-Demand Taxi Trips 616 150 309 258 345 (271) -44.0% Primary contributing factors Expense Detail Payroll 708 727 740 720 771 62 8.8% COVID related decline in passengers Curbside Assistance (ABM) 1,700 1,752 1,800 1,800 1,800 100 5.9% Customer preference shift away from Consultants - 101 50 50 100 100 N/A Credit Card Fees - - 74 35 52 52 N/A shared-ride transportation options, Other Direct O&M 160 58 24 56 55 (104) -65.2% especially taxis Subtotal Direct O&M 2,568 2,638 2,688 2,661 2,778 210 8.2% Taxi curbside assistance contract is a Divisional Allocations 395 295 306 206 266 (129) -32.7% Corporate Allocations 148 180 248 167 185 38 25.5% fixed monthly amount, not scaled to Subtotal Operating Expenses 3,110 3,112 3,242 3,033 3,228 119 3.8% increase or decrease in passengers or Asset Ammortization 104 194 283 266 270 165 158.5% taxi trips Total Expenses 3,214 3,307 3,524 3,300 3,498 284 8.8% 2021 Forecast Divisional and Corporate allocations not re-estimated. Taxi pro-rata share of O&M expenses declined in 2021 forecast primarily due to inclusion of TNC Drop-Off trip counts in the cost-recovery model. 2021 Budget did not include TNC Drop-Off trips due to the agreement that included the new fee was not signed until after the budget was approved. 111 ADR Revenue before Concessionaire Relief Grants Inc/(Dec) from 2021 Inc/(Dec) from 2019 2019 2020 2021 2021 2022 Revenue Summary (in 000's) Budge t Budge t Org(s): 3650-Airport Dining and Retail, Proposed Class: Top Level Actual Actual Budge t Fore cas t Budge t $ Change % Change $ Change % Change Operating Revenue Advertising Revenue 7,326 4,285 5,153 3,310 7,278 2,124 41.2% (49) -0.7% Duty Free Revenue 6,189 1,842 3,599 1,021 2,689 (911) -25.3% (3,500) -56.6% Food and Beverage Revenue 26,314 9,709 18,456 20,206 29,250 10,794 58.5% 2,937 11.2% Retail Revenue 16,313 6,328 13,360 13,082 17,491 4,130 30.9% 1,178 7.2% Concession Services Revenue 3,847 1,728 3,900 1,591 2,152 (1,748) -44.8% (1,695) -44.1% Space Rental & All Other Revenue 1,625 1,527 1,466 1,170 1,413 (53) -3.6% (212) -13.1% Operating Revenues before 61,614 25,418 45,936 40,381 60,272 14,336 31.2% (1,342) -2.2% Concessionaire Relief Federal Grant Concessionaire Relief 0 0 0 (3,114) (21,419) Operating Revenue after 61,614 25,418 45,936 37,267 38,853 (7,083) -15.4% (22,761) -36.9% Concessionaire Relief Enplane me nts 25,874 10,044 18,216 19,132 24,648 6,433 35.3% (1,225) -4.7% Duty-Free is the slowest for overall ADR recovery as international passenger traffic continues to be restricted throughout the world and our agreement is being renegotiated Food & Beverage and Retail are recovering most quickly now as passengers return to the airport, but is still experiencing substantial challenges related to construction, government restrictions, and labor shortages. 112 Airport Dining & Retail - Key Metrics 2019 2020 2021 2021 2022 Revenue Summary (in 000's) Inc/(Dec) from 2019 Budget Org(s): 3650-Airport Dining and Retail, Proposed Class: Top Level Actual Actual Budget Fo recast Budget $ Change % Change Sales per Enplanement Duty Free $ 0.77 $ 0.47 $ 0.65 $ 0.33 $ 0.61 $ (0.17) -21.5% Food & Beverage $ 7.56 $ 7.83 $ 8.18 $ 8.52 $ 8.92 $ 1.36 18.0% Retail $ 3.99 $ 4.14 $ 4.79 $ 4.58 $ 4.72 $ 0.73 18.2% Services $ 0.80 $ 0.49 $ 0.56 $ 0.25 $ 0.44 $ (0.35) -44.4% SPE - Airport Dining & Retail $ 13.12 $ 12.94 $ 14.18 $ 13.68 $ 14.69 $ 1.57 11.9% Revenue per Enplanement Duty Free $ 0.24 $ 0.18 $ 0.20 $ 0.05 $ 0.11 $ (0.13) -54.4% Food & Beverage $ 1.02 $ 0.97 $ 1.01 $ 1.06 $ 1.19 $ 0.17 16.7% Retail $ 0.63 $ 0.63 $ 0.73 $ 0.68 $ 0.71 $ 0.08 12.5% Services $ 0.15 $ 0.17 $ 0.21 $ 0.08 $ 0.09 $ (0.06) -41.3% RPE - Airport Dining & Retail $ 2.38 $ 2.53 $ 2.52 $ 2.11 $ 2.45 $ 0.06 2.7% 113 Non-Aero Commercial Properties Revenue Inc/(Dec) from 2019 2019 2020 2021 2021 2022 Revenue Summary (in 000's) Actuals Org(s): 3630-Non-Aero Commercial Proposed Properties, Class: Top Level Actual Actual Budge t Fore cas t Budge t $ Change % Change Operating Revenue Land Rental 4,658 5,267 5,222 5,323 5,457 799 17.1% Space Rental 464 942 800 759 757 294 63.3% In-Flight Kitchen Revenue 10,053 3,990 7,078 5,761 8,873 (1,180) -11.7% Other Service Revenues 548 566 613 613 452 (96) -17.5% Operating Grant Revenues 49 0 0 0 0 (49) -100.0% Total Operating Revenues 15,773 10,765 13,713 12,456 15,540 (233) -1.5% Enplane me nts Total Enplanements 25,874 10,044 18,216 19,132 24,648 (1,225) -4.7% International Enplanements 2,858 670 1,643 971 2,218 (640) -22.4% In-Flight Kitchen RPE Rev per Total Enplanements $ 0.39 $ 0.40 $ 0.39 $ 0.30 $ 0.36 $ (0.03) -7.3% Rev per International Enplanements $ 3.52 $ 5.95 $ 4.31 $ 5.93 $ 4.00 $ 0.48 13.7% In-Flight Kitchen revenue is more closely tied to international enplanements than previously realized. As international flying returns, we expect In-Flight Kitchen revenue will as well Land and Space Rents are impervious to the drop in enplanements and grow as planned in 2022. 114 Non-Airline Terminal Leased Space Revenue Inc/(Dec) from 2019 2019 2020 2021 2021 2022 Revenue Summary (in 000's) Actuals Org(s): 3645-Non-AirlineTerminal Leased Proposed % Spc, Class: Top Level Actual Actual Budge t Fore cas t Budge t $ Change Change Operating Revenue Maintenance Service Fees 238 10 28 8 26 (213) -89.3% Space Rental 6,159 5,806 5,220 5,834 7,312 1,153 18.7% Other Service Revenues 1 0 0 0 0 (1) -100.0% Total Operating Revenues 6,398 5,816 5,248 5,842 7,338 940 14.7% Total Enplanements 25,874 10,044 18,216 19,132 24,648 (1,225) -4.7% AlClear Sales per Enplanements (SPE) $0.58 $1.29 $0.61 $0.83 $0.58 $0.00 -0.3% TSA Maintenance Service Fees removed under new lease agreement Space Rental AlClear (~23% of Space Rent Revenue) continues to perform well in the current environment, generally moving in line with enplanements Remaining Lease Terms are generally not tied to enplanements and therefore remain fairly consistent between 2019 and 2022, though we did lose some of our smaller tenants due to COVID-19 business impacts in 2020. 115 Port-owned Clubs & Lounges Revenue & Expense Inc/(Dec) from 2019 Clubs & Lounges (in 000's) 2019 2020 2021 2021 2022 Budge t Org(s): 3690-Club International Lounge, Proposed Class: Top Level Actual Actual Budge t Fore cas t Budge t $ Change % Change Clubs & Lounges Revenue 10,274 2,043 6,221 4,001 8,972 (1,301) -12.7% Clubs & Lounges Expenses Base Mgmt Fee 183 243 406 363 421 239 130.8% Incentive Mgmt Fee 243 331 41 0 182 (61) -24.9% Total Mgmt Fee 425 574 448 363 603 178 41.9% 3rd Party Direct Operating Expenses 3,331 1,025 2,534 1,998 3,345 13 0.4% B&O Taxes 153 29 109 86 157 4 2.8% Other Expenses 55 0 0 0 0 (55) -100.0% Clubs & Lounges Expenses 3,964 1,627 3,090 2,447 4,105 141 3.5% Income from Operations 6,309 416 3,131 1,554 4,867 (1,442) -22.9% Clubs & Lounges revenue is recovering better than international enplanements now that both lounges have reopened and are fully operational. Incremental Base Management Fee (compared to 2019 Actuals) reflects new contract effective April 2020. 116 FEDERAL RELIEF GRANT USE PLAN ALLOCATION BY COST CENTER 117 Federal Relief Grants by Cost Center SEA Grant Summary Grants Received: $383.9 CARES $192.1 CRRSA $37.4 ARPA $154.4 *excludes concessions grants Grants Applied 2020 2021 2022 Total Airline Benefit Airfield Movement Area $32.3 $37.5 $11.8 $81.6 Airfield Apron Area $7.7 $9.3 $5.6 $22.6 Terminal Building ** $28.7 $20.6 $12.6 $62.0 Federal Inspection Services ** $12.9 $29.4 $16.6 $58.8 Baggage System $10.4 $7.4 $3.5 $21.2 Gate Utilities $4.2 $4.4 $2.8 $11.4 Others $4.3 $3.2 $1.7 $9.2 Total Airline Benefit $100.5 $111.7 $54.6 $266.8 Non-Airline Benefit ** $46.6 $49.0 $21.5 $117.1 Total Federal Funding Applied $147.1 $160.7 $76.1 $383.9 Cumulative Remaining $45.0 $76.1 $0.0 $0.0 Airline Benefit 68% 70% 72% 69% Non-Airline Benefit ** 32% 30% 28% 31% Grant Usage Debt Service $103.9 $128.8 $66.3 $299.0 O&M $43.3 $31.9 $9.8 $84.9 ** Grants are shown after allocations 118
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