Digital recordings of the meeting proceedings and meeting materials are available online – www.portseattle.org.
APPROVED MINUTES
COMMISSION SPECIAL MEETING NOVEMBER 13, 2018
The Port of Seattle Commission met in a special meeting Tuesday, November 13, 2018, in the
Central Auditorium at Seattle-Tacoma International Airport, Seattle, Washington. Commissioners
Calkins, Felleman, Gregoire, and Steinbrueck were present. Commissioner Bowman was present
until 4:14 p.m.
1. CALL to ORDER
Pursuant to Article IV, Section 8, of the commission bylaws, the meeting convened at 11:05 a.m. to
conduct an executive session.
2. EXECUTIVE SESSION pursuant to RCW 42.30.110
The notice posted during the executive session included one matter related to litigation and legal
risk. The time for reconvening was posted as 12:00 noon, in accordance with commission bylaws
and the public meeting notice previously published. Following the executive session, which lasted
approximately 20 minutes, the public meeting reconvened at 12:00 p.m. Commissioner Gregoire
led the flag salute.
3. APPROVAL of the AGENDA
Without objection, the preliminary agenda was revised to remove agenda item 6f from the
Unanimous Consent Calendar for separate discussion and to consider it immediately after item 8c.
4. EXECUTIVE DIRECTOR’S REPORT
Executive Director Steve Metruck previewed items on the day’s agenda and made
announcements.
5. PUBLIC COMMENT
Public comment was received from the following individual(s):
Rick Johnson, Des Moines resident, regarding the Federal Aviation Administration’s
NextGen initiative and airport community impacts.
Steve Edmiston, the Briefing Project, regarding airport community impacts. Mr. Edmiston
submitted written materials, which are attached as minutes Exhibit A.
Bernedine Lund, Federal Way resident, regarding flight paths and the noise remedy
boundary.
Dana Hollaway, Federal Way resident, regarding airport community impacts.
Wendy Ghiora, Des Moines resident, regarding airport community health impacts.
P.O. Box 1209
Seattle, Washington 98111
www.portseattle.org
206.787.3000
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Minutes of November 13, 2018, submitted for review on December 5, 2018, and proposed for approval on December 11, 2018.
Debi Wagner, Burien resident, regarding airport community impacts.
Matthew Shelby, Alaska Airlines, regarding the 2019 budget.
Peter Tarabochia, Seattle Marine Business Coalition, regarding 2019 budget.
Susan Chesney, Sales Manager, National Fisherman, regarding the port tax levy.
6. UNANIMOUS CONSENT CALENDAR
[Clerk’s Note: Items on the Unanimous Consent Calendar are not individually discussed.
Commissioners may remove items for separate discussion and vote when approving the agenda.]
6a. Approval of the minutes of the regular meeting of October 9, 2018.
6b. Approval of the Claims and Obligations for the period October 1, 2018-October 31,
2018, including accounts payable check nos. 926226-926744 in the amount of
$4,750,039.20; accounts payable ACH nos. 011734-012575 in the amount of
$76,030,657.87; accounts payable wire transfer nos. 014980-014997 in the amount of
$11,059,071.21, payroll check nos. 191045-191274 in the amount of $232,131.76; and
payroll ACH nos. 879493-883632 in the amount of $10,535,627.37 for a fund total of
$102,607,527.41.
Request document(s) included an agenda memorandum.
6c. Authorization for the Executive Director to execute an interlocal agreement with the
Northwest Seaport Alliance (NWSA) to implement a series of support service
agreements to allow Port staff to provide services to the NWSA for 2019.
Request document(s) included an agenda memorandum and presentation slides.
6d. Authorization for the Executive Director to execute Change Order 1 to Contract MC-
0319157, at Seattle-Tacoma International Airport, to extend the contract duration by 116
calendar days to correct an administrative error in the calculation of the contract
duration. No additional funds are being requested, nor does the requested time
extension represent a delay to the project. (CIP#C800658)
Request document(s) included an agenda memorandum.
6e. Authorization for the Executive Director to: (1) increase the value of the current Unified
Pest Management contract at Seattle-Tacoma International Airport by $550,000 to
continue current services from January 2019 through June 2019; (2) competitively bid
and execute a new five-year follow-on contract (commencing on or about July 1, 2019,
and continuing through June 30, 2024) for a base year and four additional 1-year
options for an estimated amount of $5,000,000.
Request document(s) included an agenda memorandum.
As noted above, agenda item 6f was temporarily postponed.
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TUESDAY, NOVEMBER 13, 2018
Minutes of November 13, 2018, submitted for review on December 5, 2018, and proposed for approval on December 11, 2018.
The motion for approval of consent items 6a, 6b, 6c, 6d, and 6e carried by the following vote:
In favor: Bowman, Calkins, Felleman, Gregoire, Steinbrueck (5)
7. SPECIAL ORDERS of BUSINESS
7a. Proclamation regarding Port of Tacoma Centennial.
Request document(s) included a draft proclamation. The adopted proclamation is attached.
The commission presented a proclamation acknowledging the Port of Tacoma’s importance to the
region on its Centennial Anniversary.
The motion for approval of agenda item 7a carried by the following vote:
In favor: Bowman, Calkins, Felleman, Gregoire, Steinbrueck (5)
7b. 2019 Maritime and Economic Development Capital Budgets Briefing.
Presentation document(s) included an agenda memorandum and presentation slides.
Presenter(s): Dave McFadden, Managing Director, Economic Development, and Stephanie Jones
Stebbins, Managing Director, Maritime.
An overview of Maritime and Economic Development Division projects for 2019-2023 was given.
These projects were discussed in detail at a study session on November 7, 2018.
Commissioners asked for further exploration of the funding model and cost-sharing options for
cruise terminal electrification. They also discussed the amount and uses of the contingency fund
and pointed out that the budget is a blueprint for future projects, but each one will need individual
authorization before proceeding.
7c. Briefing on the Tax Levy and Draft Plan of Finance for 2019-2023.
Presentation document(s) included an agenda memorandum and presentation slides.
Presenter(s): Elizabeth Morrison, Director Corporate Finance.
Airport and non-airport projects have different funding models. Federal Aviation Administration
regulations restrict the use of airport revenue. Tax levy dollars do not go to the airport, but they do
go to projects to support surrounding communities. Tax levy funds are used for the Maritime and
Economic Development Divisions, and the Port of Seattle’s participation in the Northwest Seaport
Alliance.
Two forms of debt are leveraged to increase funding: revenue bonds, which are paid for by
revenues generated by business opportunities; and general obligation bonds, which are supported
by the tax levy. Debt funding is best used for long-term assets that will generate revenue for many
years.
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Minutes of November 13, 2018, submitted for review on December 5, 2018, and proposed for approval on December 11, 2018.
Commissioners pointed out that tax levy funds have been used to fund projects with broad
benefits, like the State Route 99 tunnel and Safe and Swift Corridor. Maritime facilities, which are
supported by tax levy funds, are considered public assets.
The level of the tax levy is $72 million and has not increased for 10 years. Of the $6,000 paid for a
King County home at the median value, $69 goes to the Port of Seattle. An increase to the tax levy
of three percent would add $1.39 to the median homeowner’s tax bill in 2019. Increasing the tax
levy amount by three percent over the next five years, and buying bonds to maximize funds, would
result in an additional $127 million in capital funds.
8. AUTHORIZATIONS and FINAL ACTIONS
8a. Introduction and public hearing of Resolution No. 3751: A resolution of the Port
Commission of the Port of Seattle adopting the final budget of the Port of Seattle for
the year 2019; making, determining, and deciding the amount of taxes to be levied
upon the current assessment roll; providing payment of bond redemptions and
interest, cost of future capital improvements and acquisitions, and for such general
purposes allowed by law which the Port deems necessary; and directing the King
County Council as to the specific sums to be levied on all of the assessed property of
the Port of Seattle District in the Year 2019.
Request document(s) included an agenda memorandum, presentation slides, and draft resolution.
A copy of the final draft of Resolution No. 3751 will be made available upon adoption.
Previously, a presentation on Resolution No. 3751 was made on October 23, 2018.
Presenter(s): Dan Thomas, Chief Financial Officer, and Michael Tong, Assistant Finance Director –
Budget.
The budget process, highlights, and key initiatives were summarized. The framework for the
budget is support of the Port’s economic development and community priorities. Changes that
occurred after the publication of the preliminary budget were summarized and are detailed on
slides 8 and 9 of the presentation that accompanies this agenda item. 2019 financial performance
is expected to continue to be strong.
When asked about the increase to Central Services expenses, staff responded that the general
Central Services expense budget is a relatively small category of miscellaneous expenses; the bulk
of expense funding is allocated to operating divisions.
A summary of full-time equivalent positions (FTEs) was provided. Staff noted that total FTE
numbers were increased significantly by the employee screening and internship programs.
Commissioners requested more information about Central Services FTEs, especially those
associated with construction projects at the airport.
Funding sources for the port budget were reviewed.
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TUESDAY, NOVEMBER 13, 2018
Minutes of November 13, 2018, submitted for review on December 5, 2018, and proposed for approval on December 11, 2018.
PUBLIC HEARING on Resolution No. 3751
Upon a motion and second for introduction of Resolution No. 3751, Commissioner Gregoire
declared the public hearing for the resolution open. Comment was received from the following
individual(s):
J.C. Harris, Des Moines resident.
Dana Hollaway, Federal Way resident.
Following conclusion of public comment, the public hearing on Resolution No. 3751 was closed.
The meeting was recessed at 2:46 p.m. and reconvened at 2:56 p.m., chaired by Commissioner
Gregoire.
AMENDMENT
An amendment was offered to set the amount of the contingency fund at eight percent of the total
dollar value of the projects identified in the 2019-2022 Maritime and EDD CIPs, which would be
$24,640,000. The funds set aside for contingency would be used primarily for asset preservation
and maintenance of port facilities and properties.
Commissioners engaged in a discussion about the contingency fund, including past use of the
fund. It was suggested that the amendment be divided into two questions: the amount of the
contingency fund and the acceptable uses of the contingency fund.
The amendment was laid on the table without objection.
[Clerk’s Note: This amendment was not taken up for further consideration prior to budget adoption
on November 27.]
Commissioners reiterated a desire for more information about proposed new FTEs, especially
regarding aviation projects.
The possibility of using additional tax levy funds for projects benefitting airport communities was
discussed, and commissioners requested exploration of this concept.
Increasing the quality and scope of the internship program, the fair work center pilot project, and
the Youth Maritime Co-op were also discussed, and commissioners requested more exploration of
these initiatives.
Commissioner Steinbrueck stated his intention to abstain and commented on his need for more
information regarding the funding of a fair work center pilot project and partnership opportunities
with organized labor.
The motion for introduction of Resolution No. 3751 carried by the following vote:
In favor: Bowman, Calkins, Felleman, Gregoire (4)
Abstaining: Steinbrueck
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Minutes of November 13, 2018, submitted for review on December 5, 2018, and proposed for approval on December 11, 2018.
8b. Introduction of Salary and Benefits Resolution No. 3752: A resolution of the Port of
Seattle Commission amending the policy directive for salaries and benefits for
employees not covered by a collective bargaining agreement established by Resolution
No. 3739 and providing an effective date for all amendments of January 1, 2019.
Request document(s) included an agenda memorandum, presentation slides, exhibit, draft
resolution, redline version, and summary of changes. A copy of the final draft of Resolution No.
3752 will be made available upon adoption.
Previously, a presentation on Resolution No. 3752 was made on October 23, 2018.
Presenter(s): Ann McClellan, Total Rewards Manager and Jeniann Kaelin, Total Rewards
Consultant.
Staff provided an overview of 2019 Salary and benefits. Major changes this year include
elimination of retiree medical plans and the addition of a personal day. There is also a clarification
to the reporting structure for the Internal Audit Director.
The motion for approval of introduction of Resolution No. 3752 carried by the following vote:
In favor: Bowman, Calkins, Felleman, Gregoire, Steinbrueck (5)
Commissioner Bowman was present until 4:14 p.m.
8c. Authorization for the Executive Director to execute a contract amendment with VIP
Hospitality (Contract Number S-00318180) for support services in the International
Arrivals Facility at Seattle-Tacoma International Airport for an estimated amount of
$3,220,000.
Request document(s) included an agenda memorandum and presentation slides.
Presenter(s): Michael Ehl, Director Airport Operations and Sabin Mudaliar, Airport Duty Manager.
International passenger growth is steadily increasing. Measures such as the addition of passport
control kiosks, queue revision, and the addition of gates have been implemented to manage
passenger congestion. Authorization of this contract amendment will provide for the additional staff
that are needed to help customers make their way through the facility.
The motion for approval of agenda item 8c carried by the following vote:
In favor: Calkins, Felleman, Gregoire and Steinbrueck (4)
Absent for the vote: Bowman
As noted on the agenda, the Commission advanced to consideration of the following agenda item –
6f. Authorization for (1) the Executive Director to spend environmental remediation funds
for 2019 in the amount of $17,025,000 and (2) approving a five-year spending plan for
$116,026,000 for the environmental remediation liability (ERL) program for 2019-2023,
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Minutes of November 13, 2018, submitted for review on December 5, 2018, and proposed for approval on December 11, 2018.
of which an amount estimated not to exceed $30,000,000 will be obligated during 2019
to be spent in future years.
Request document(s) included an agenda memorandum and attachments one, two, and three.
Presenter(s): Kathy Bahnick, Senior Manager, Environmental Programs and Don Robbins, Senior
Environmental Program Manager.
This authorization will fund actions at 19 port properties. Approximately $17 million is authorized to
be spent, but reimbursement will be sought from polluters. Reimbursement has historically
contributed about 86 percent to covered environmental actions.
The motion for approval of agenda item 6f carried by the following vote:
In favor: Calkins, Felleman, Gregoire and Steinbrueck (4)
Absent for the vote: Bowman
9. PRESENTATIONS, REPORTS, and STAFF BRIEFINGS
Without objection, agenda item 9a was temporarily postponed until November 27, 2018.
10. QUESTIONS on REFERRAL to COMMITTEE – None.
11. ADJOURNMENT
There was no further business, and the meeting adjourned at 4:44 p.m.
Prepared: Attest:
Amy Dressler, Deputy Commission Clerk Ryan Calkins, Commission Secretary
Minutes approved: December 11, 2018.
