Motion 2018-10 – Executive Director Relocation Reimbursement Page 1 of 2
MOTION 2018-10: 1
A MOTION OF THE PORT OF SEATTLE COMMISSION 2
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modifying the executive director employment agreement 4
with Stephen Metruck to increase the amount of 5
relocation reimbursement due to changes in federal tax 6
law to account for taxes withheld from reimbursement 7
payments; providing an effective date. 8
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PROPOSED 10
SEPTEMBER 11, 2018 11
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TEXT OF THE MOTION 13
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The Port Commission hereby modifies the employment agreement approved by the 15
Commission on December 19, 2017, appointing Stephen Metruck as Executive Director of the 16
Port of Seattle, to increase the amount of relocation reimbursements to account for taxes 17
withheld from payments, and to increase the maximum amount of relocation reimbursement 18
from $100,000 to $133,000, in consideration of changes in federal tax law. 19
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This motion shall be applied retroactively to the effective date of the employment agreement. 21
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STATEMENT IN SUPPORT OF THE MOTION 23
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The Port’s employment agreement with Executive Director Stephen Metruck approved 25
December 19, 2017, provides for relocation expense reimbursement to assist him in moving his 26
residence from outside the state of Washington to the Seattle area. The maximum amount of 27
all relocation reimbursement was set at $100,000, subject to the terms of Attachment B of the 28
employment agreement (attached). 29
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Federal tax law in effect at the time the agreement was approved allowed individuals to claim a 31
deduction for moving expenses paid in commencement of work at a new principal place of 32
work. The port anticipated Executive Director Metruck would be able to deduct federal income 33
taxes on the reimbursements. 34
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The federal Tax Cuts and Jobs Act, signed into law on December 22, 2017, made several 36
changes to the taxability and deductibility of relocation reimbursements. Effective December 37
31, 2017, an employee can no longer deduct moving expenses, nor can an employer pay or 38
reimburse an employee’s moving expenses on a tax-free basis. 39
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Item Number: 6e_motion
Meeting Date: September 11, 2018
Motion 2018-10 – Executive Director Relocation Reimbursement Page 2 of 2
Due to these changes in the tax law, Executive Director Metruck would be required to pay taxes 41
on his relocation reimbursements, and thus the relocation benefit would be reduced below the 42
amount authorized by the commission prior to enactment of the tax law. 43
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This action would increase Executive Director Metruck’s relocation reimbursement and would 45
increase the maximum total amount of the relocation reimbursement to reflect anticipated 46
taxes on the approved relocation benefit. The action would be applied retroactively to 47
reimbursements previously approved. He has previously submitted reimbursement receipts for 48
some expenses and it is assumed he will request reimbursement to the maximum originally 49
anticipated amount of $100,000. 50
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Adoption of this revision will honor the intent of the employment agreement. All other terms 52
and conditions of the employment agreement shall remain the same. 53
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ADDITIONAL INFORMATION ATTACHED 55
Employment agreement executed December 19, 2017 56
