Item No: 9c_supp
Meeting Date: March 12, 2019

Port of Seattle
2018 Financial Performance Report

Portwide Financial Highlights
•

2018 Actual vs. 2018 Budget:
o
o
o
o
o

•

Operating Revenues $18.9M favorable to budget.
The Non-Airport Revenues $15.8M favorable to budget.
Operating Expenses $25.2M favorable to budget.
Net Operating Income before depreciation $44.2M favorable to budget.
Total capital spending was $617.7M, 70.6% of the budget.

2018 Actual vs. 2017 Actual:
o Operating Revenues $57.4M higher than 2017.
o Operating Expenses $24.7M higher than 2017.
o NOI before depreciation $32.7M higher than 2017.

A record year of operating revenues and net operating income for 2018
2

Portwide Net Operating Income Performance
Other Operating Revenues

Aeronautical Revenues

Total Operating Expenses

NOI

• Operating Revenues are $18.9M
higher than budget due to higher
revenues in:
o Public Parking
o Rental Cars
o ADR
o Ground Transportation
o Fishing & Operations
o Conference & Event Centers

In 000s
800,000
700,000
600,000
500,000
400,000

• Total Operating expenses are
$25.2M below budget due to:
o Staffing vacancies
o DRS Pension True-up credit
o Project delays

300,000
200,000
100,000
0

2014

2015

2016

2017

2018
Actual

2018
Budget

Steady revenue growth since 2014
3

Non-Airport Net Operating Income Performance
Total Operating Revenues

Total Operating Expenses

NOI

In 000s
160,000
140,000
120,000

100,000
80,000
60,000
40,000
20,000

• Non-Airport Operating Revenue
exceeded budget by $15.8M due to:
o Higher tariff rates
o More cruise passengers
o Increased activity in Conference
and Event Centers
o Higher NWSA Distributable
Revenue
• Expenses are $9.2M lower than budget
due to:
o Staffing vacancies
o Project delays
• Expense growth in 2018 compared to
2017 was driven by adding staff and
resources to support Port priorities.

2014

2015

2016

2017

2018 Actual

2018 Budget

2018 NOI exceeded budget and 2017 actuals
4

Aviation Division
2018 Financial Performance Report

Aviation Business Events
• Record number of passengers: 49.8 million, +6.2% over 2017
• Sea-Tac is now 8th busiest U.S. airport

• Welcomed three new international carriers:

• Aer Lingus to Dublin, Ireland
• Air France to Paris, France
• Thomas Cook Airlines to Manchester, England

• Record capital spending of $579 million

• Completed and opened Concourse D Hardstand Terminal

• Record Operating Revenues: $549 million, +10.3%

• Achieved budget targets for Non-Aero NOI and airline cost management
(CPE)

Growth at Sea-Tac Continues
6

Business Highlights: 2018 Goals
• Safety: Below targets:
• 2018 Airfield Composite Safety Score of 12 vs. goal of 29
• 2018 Occupational injury rate of 5.9 vs. goal of 4.6

• 2018 days away severity rate of 90.8 vs. goal of 65.1
• Innovation & Efficiency: Achieved goal of at least 2 in each department. Highlights
include:

• SEA Visitor Pass pilot program implemented in Q4
• Installed dynamic ticket counter signage in Zone 1
• Completed Lean Lift for traffic congestion, resulting in 41% reduction in stop and
go traffic conditions at 0600 on departure drive.
• Asset Management: Completed asset management gap assessment in Q3

Challenges with Safety in 2018
7

Business Highlights: 2018 Goals
• Social Responsibility: Mixed results:
• Achieved Disadvantaged Business Enterprise (DBE) share of total Airport Improvement
Project (AIP) funded construction contracts of 15.43% vs. goal of 8%
• Achieved ACDBE share of ADR gross sales of 19.9% vs. goal of 22%
• Customer Service: Below targets. Airport Service Quality scores below 2017 in all 6
categories as result of rapid growth and construction.
• Environment and Sustainability:
• SAF: Commission approved sustainable aviation fuel strategic plan in Q3
• Sound insulation: 20 homes not insulated, but gained FAA grant to fund work in 2019
• Stormwater: Completed regional stormwater assessment in Q4

Passenger growth and construction made achievement of customer service targets difficult
8

Business Highlights: 2018 Goals
• Financial Performance: Achieved both goals
• 2018 Non-aero NOI of $150 million vs. budget of $127 million
• 2018 CPE of $10.79 vs. adjusted budget of $11.63
• Capital Project, Planning & SAMP: Achieved most milestones:
• Completed SAMP near term projects scoping for Environmental Review in Q3
• IAF: Completed design, sterile corridor Pod A, structural steel, bridge foundations
• NSAT: On track to achieve opening of phase 1A in January 2019

• Baggage Optimization: Phase 1: completed 74% of construction; Phase 2 completed 90% of
design
• SSAT Renovation: On hold
• Concourse D Hardstand Terminal: Facility completed, activated and operational

• Restroom Upgrades: Phase 1 enabling work in construction

Progress on major project milestones
9

Airport Activity
Passengers
Growth rate
60,000

14.0%

37,498

30,000

7.7%

49,308

12.0%
10.0%
8.0%

Int'l

40,000

Int'l

42,341

49,850

Int'l

46,935
Int'l

45,737

Int'l

50,000

Int'l

12.9%

8.0%

6.2%

6.0%
5.1%

20,000

2016

Domestic

2015

Domestic

Domestic

2014

2.6%

Domestic

Domestic

0

Domestic

10,000

4.0%

2017

2018 Actual

2018 Budget

2.0%

Year-to-date Q4:
•
Passengers +6.2%
•
Landed weight +6.8%
•
Cargo metric tons
+6.3%
Airline Passenger Growth:
• Delta +10.5%
• Alaska +4.6%

0.0%

Passenger growth ended with 6.2% growth at year end
10

Airline Cost Management (CPE)
CPE

CPE

Revenue Sharing ($000s)

12.00

42,310

11.63

11.50

37,395

11.48

36,863
35,799

29,436

11.00

2018 CPE Actual:
•

Adjusted for SLOA IV 40%
revenue sharing

•

CPE Actual is below
adjusted budget - primarily
driven by increased nonairline revenues generating
more revenue sharing, and
year-end pension credit
adjustment.

10.79
10.52

10.50
17,034

10.12

10.10

2014

2015

2016

10.00

9.50

9.00

2017

2018 Actual 2018 Budget

CPE below budget driven by increased non-airline revenues generating more revenue sharing
11

Non-Aeronautical Performance
In 000s

Non-Aero NOI ($000s)

Non-Aero Revenue per Enplanement

180,000
160,000

9.66

9.33

140,000

10.11

10.35
149,959

128,727

120,000

100,000

9.70

133,101

9.93
126,861

YTD 2018 vs. 2017:
•
Revenues +8.8%
•
Expenses +3.9%
•
NOI +12.7%
Revenue growth:
•
Rental car CFC
•
Public parking
•
ADR
•
GT

112,618
100,386

80,000
60,000

40,000
20,000
-

2014

2015

2016

2017

2018 Actual

2018 Budget

ADR, parking and TNCs performed better than expected in 2018
12

Total Operating Expense Performance
Total O&M Expense ($000s)

In 000s

O&M Expense per Enplanement

450,000
400,000

2018 Actual to 2018 Budget
12.77

12.81

13.58

12.19
11.28

350,000

11.46

334,856
299,114

300,000

318,849

261,226
250,000

228,172

238,140

200,000
150,000
100,000

Operating Expenses favorable $16M due to:
• Total Airport Expenses higher by ($3.7M)
primarily due to the following Expense
Exceptions:
• Increase in ERL expense ($2.2M)
primarily due to remediation required
for IAF& NSAT mega projects
• Capital to Expense write-offs ($6.9M)
• Partially offset by impact of Pension
Credit to Airport $5.5M.
• Savings from other divisions $19.7M
including schedule delays for planned
expense projects. Note: Impact of Pension

Credit to Corporate and other divisions
was $7.2M

50,000
2014

2015

2016

2017

2018 Actual

2018 Budget

2018 savings/deferrals covering most unplanned expenditures
13

Capital Spending
In 000s
900,000
795,883
800,000
700,000

2018 Year-End Actual:
•
IAF = $224M
•
NSAT = $169M
•
Other = $186M

579,135

600,000
500,000

Major 2018 Variances:
•
IAF = $101M
•
Automated Security
Lane = $15.2M
•
NSAT = ($28.2M)

400,000
294,497
300,000
200,000

155,970

164,931

153,887

2014

2015

2016

100,000
-

2017

2018 Actual

2018 Budget

2018 spending variances primarily due to delayed spending, not project savings
14

Maritime Division
2018 Financial Performance Report

Business Highlights
216 Homeport Cruise sailings.
1,114,888 Cruise passengers served.
1,643 recreational moorage slips.
4,378,796 metric tons of grain exported.
2,829,294 linear feet of berth occupied by working Maritime Vessels.
10,000 people attended Fishermen's Fall Festival.

Dynamic and complex operations
16

Business Highlights
2,300 creosote pilings removed
6,000 pounds of oysters installed
33.3 miles of stormwater lines assessed
6 tide gates installed,
8 college interns,
15 high school interns
9 apprentices at Marine Maintenance.
1 Veterans Fellow
2 CPI certified Lean Specialists,
10 Leaders trained in CPI Idea Generation.

Environmental and Workforce Development are significant efforts
17

Maritime Financial Highlights
Maritime - 2018 NOI is $8,848K favorable to budget and $2,303K or 19% higher than 2017
•

Revenue favorable to budget by $2,522K and $3,391K or 6% greater than 2017 with significant increases
seen in all lines of businesses.

•

Expenses favorable to budget by $6,326K and $1,088K higher than 2017. Y/Y increase driven primarily by
Maintenance, both hourly rates and heavier workload.

•

Including Depreciation 2018 Operating Loss ($3.7M), down from ($5.4M) in 2017 putting the division on
Fav (UnFav)
Incr (Decr)
track for 2024 profitability goal.
2016
2017
2018
2018
Budget Variance
Change from 2017

•

2018 Capital at 54% of budget driven by
restroom and paving projects at Shilshole
Bay moving spending to 2019.

•

Stormwater Utility NOI is $339K favorable
to budget.

$ in 000's
Total Revenues

Actual
50,810

Actual
54,183

Actual
57,575

Budget
55,053

$
2,522

%
5%

$
3,391

%

Total Operating Expenses

40,384

42,164

43,252

49,578

6,326

13%

1,088

3%

Net Operating Income

10,426

12,020

14,323

5,475

8,848

162%

2,303

19%

Depreciation

17,351

17,410

18,022

17,868

(154)

-1%

612

4%

Net Income

(6,924)

(5,390)

(3,699)

(12,394)

8,695

70%

1,691

31%

Capital Expenditures

5,746

20,489

25,091

46,449

21,358

46%

4,602

22%

6%

Maintaining Port properties while growing Net Income
18

Maritime Division Financial Trends
In 000s
80,000

Growth from 2017:
•
Revenue $3,391K, 6.3%
•
Expenses $1,088K, 2.6%

70,000
60,000
50,000

Depreciation
Allocation

40,000

Operating Expense
30,000

Revenue

Budget Variance Fav./(Unfav.):
•
Revenue $2,522K, 4.6%
•
Expenses $6,326K, 12.8%
Revenue - Growth strong in every
business except grain terminal.
Expenses - Down Y/Y when
backing out Salmon Bay Marina
and annual pay increases.

20,000
10,000
2014

2015

2016

2017

2018 Actual 2018 Budget

Trending to profitability in 2024
19

Cruise Financial Trends
In 000s

Growth from 2017:
•
Revenue $1,284K, 7.3%
•
Expenses $854K, 9.5%

25,000

20,000

Depreciation

15,000

Allocation
Operating Expense

10,000

Revenue

Budget Variance Fav./(Unfav.):
•
Revenue $730K, 4%
•
Expenses $2,967K, 23.1%
Revenue - Growth from tariff
increases and bigger ships.
Expenses - Growth from Port
Valet Service. Under budget due
to lower Port Valet cost and
deferred marketing spending.

5,000

2016

2017

2018 Actual

2018 Budget

Cruise continues to be profitable
20

Recreational Boating Financial Trends
In 000s

Growth from 2017:
•
Revenue $1,443K, 13%
•
Expenses $486K, 5%

16,000
14,000
12,000
10,000

Depreciation
Allocation

8,000

Operating Expense
6,000

Revenue

Budget Variance Fav./(Unfav.):
•
Revenue $362K, 3%
•
Expenses $1,394K, 12%
Revenue - Growth from tariff
increases and efficiencies improving
vacancy rates.
Expenses - Growth driven by
Maintenance and Police cost.
Recreational boating staff cost lower
Y/Y and against budget due to
deferred hiring.

4,000
2,000
2016

2017

2018 Actual

2018 Budget

Improved efficiency, improved net income
21

Fishing & Operations Trends
In 000s
20,000
18,000

Growth from 2017:
•
Revenue $465K, 5%
•
Expenses $600K, 5.6%

16,000
14,000

12,000

Depreciation

10,000

Allocation
Operating Expense

8,000

Revenue

6,000
4,000

Budget Variance Fav./(Unfav.):
•
Revenue $1,375K, 7.3%
•
Expenses $338K, 9.5%
Revenues - Improved higher backfill
of recreational vessels at
Fishermen's Terminal in the summer
while fishing boats at sea.
Expenses - Growth driven by higher
Maintenance expenses.

2,000
2016

2017

2018 Actual

2018 Budget

Strong financials during Fishermen's Terminal redevelopment
22

Maritime Portfolio Management Trends
In 000s
16,000

Growth from 2017:
•
Revenue $518K, 4.8%
•
Expenses ($413K), -3.9%

14,000
12,000
10,000

Depreciation
Allocation

8,000

Operating Expense

6,000

Revenue

4,000

Budget Variance Fav./(Unfav.):
•
Revenue $136K, 1.2%
•
Expenses $683K, 6.3%
Revenue - Growth from lease
renewals and CPI increases.
Expenses - Lower Maintenance
and Corporate Allocations than
budget and prior year.

2,000
2016

2017

2018 Actual

2018 Budget

Includes uplands of Shilshole Bay Marina, Terminal 91 (Industrial), Fishermen's Terminal, Maritime Industrial Center,
Salmon Bay Marina, T-115, T-108, and T-106

Leasing closer to market and managing costs
23

Grain Terminal Goal: Net Income Maximized
In 000s
6,000

Growth from 2017:
•
Revenue ($260K), -4.8%
•
Expenses $340K, 24.4%

5,000

4,000
3,000

Depreciation
Allocation

2,000

Operating Expense
Revenue

1,000

Budget Variance Fav./(Unfav.):
•
Revenue $4K, 0.1%
•
Expenses $102K, 5.5%
Revenues - Down Y/Y due to
tariffs in the 2nd half of the year
impacting soybean shipments.

2016

2017

2018 Actual

2018 Budget

Exceeding budget while navigating tariffs
24

Economic Development Division
2018 Financial Performance Report

Economic Development Division
Business Highlights

26

Workforce Development
•

Participated in Joint RFP for construction worker training and retention services

•

The first Port-funded Ironworkers pre-apprenticeship cohort graduated.

•

Partnered with the Regional Public Owners group to complete a construction
workforce supply demand study

•

Planned and held a highly successful Project LIFT event to highlight aviation career
opportunities

•

Launched an Airport Career Connected Learning partnership with King County
International Airport to increase awareness of airport-related career pathways in
middle and high schools

Workforce Development initiatives underway
27

Small Business / Diversity in Contracting
•

Established new Diversity in Contracting program by helping divisions establish
2019 WMBE utilization goals and finalizing 2019 internal/external outreach plans

•

Offered six PortGen training sessions - over 300 disadvantaged businesses and
prime contractors attended these events to learn about Port opportunities

•

Staged outreach event at Airport Minority Advisory Council (AMAC) Conference
where over 200 primes and WMBE businesses speed dated and discussed
partnership opportunities

•

Established first ever Disadvantaged Business Enterprise (DBE) race conscious
goal airport runway project and achieved 19% DBE utilization

Development of new Small Business policy and related program changes
28

Tourism
•

Conducted 34 travel/media FAMS tours which resulted in $550K in-kind
contributions and $7.5 million earned media value

•

Approved 34 applicants and awarded $200K to 26 recipients of the 2018
Tourism Marketing Support Program which offers marketing organizations
partnering to promote their Washington State destination to out-of-state
visitors while promoting the use of Port facilities

•

Awarded 72 recipients of the Spotlight Advertising Program which reserves
18 advertising locations at Sea-Tac airport to promote their destinations to
49 million travelers

•

Coordinated a China Sales Mission with Holland America Line to promote
Alaska cruising and pre/post experiences to cruise tour operators and
media

Promoting local destinations and gateway facilities
29

EDD Partnership Program
•

Facilitated 2017-2018 Economic Development Partnership (EDP) Grants and allocated $950K
to 30 cities in King County. $839K of allocated funds* were used by Cities to support their
projects:
•

Approximately $657K was spent in total match funds* by the 30 participating cities in the 2017-2018
EDP program year, which represents 19% more than the funds allocated initially.

•

Half of the participating cities implemented wayfinding projects or projects that support
tourism; 12 cities completed marketing projects; 11 cities implemented business assistance,
recruitment, or retention projects; and 7 cities conducted planning/feasibility studies.

•

The City of Kenmore won the Association of Washington Cities 2018 Municipal Excellence
Award in Economic Development for the Kenmore Business Incubator and Business
Accelerator training.
* "Allocated funds" and "total match funds" are based on city final reports that were submitted by
December 1, 2018. 4 cities still have outstanding invoices that will be submitted to the Port of Seattle for
reimbursement.

Continued Economic Development Partnership Program
30

Real Estate Development
•

Broke ground on the Des Moines Creek North development in SeaTac (460,000 sf
building)

•

Issued RFP for Pier 2 and working with King County water taxi on possible
development

•

Took possession of Salmon Bay Marina

•

Completed study on proposed Maritime Innovation Center

•

Prepped several properties for future development:
•
•

Terminal 106 ground lease
Terminal 91 Uplands infrastructure study

Plan for future development projects
31

Portfolio Management
•

With one third of leases rolling over in EDD and Maritime portfolios in
2018, we maintained 94% occupancy with average 11% increase in rates

•

Successfully concluded the market rate reset negotiations with
Cityice/Lineage Logistics total 9% increase in lease revenue.

•

4.4 million metric tons of grain moved through Terminal 86 in calendar year

•

Completed critical Central Waterfront capital and maintenance projects
(elevators and HVAC)

•

Completed 90% design and submitted permits for Bell Harbor
Modernization

Continued high demand for commercial properties
32

Economic Development Financial Highlights
2018 NOI $3,283K favorable to budget and $659K greater than 2017
• Revenue favorable to budget by $2,182K and $2,914K greater than 2017 driven by favorable volumes at
the Conference and Event Centers.
•

•

Expenses favorable to budget by $1,101K, with underspend in Workforce Development, Police, and
Corporate cost offset by increases in Maintenance and Conference and Event Center volume related
variable costs. Y/Y expenses up $2,255K primarily due to increased Conference and Event Center
volume.
EDD spent 34% of capital budget as $ in 000's
Total Revenues
the P69 solar panels and Bell Harbor Total Operating Expenses
International Conference Center
Net Operating Income
modernization project costs moved Depreciation
into 2019.
Net Income
Capital Expenditures

2016
Actual
15,902

2017
Actual
17,791

2018
Actual
20,705

2018
Budget
18,522

Fav (UnFav)
Budget Variance
$
%
2,182
12%

Incr (Decr)
Change from 2017
$
%
2,914
16%

20,983

25,396

27,651

28,751

1,101

4%

2,255

9%

(5,080)

(7,605)

(6,946)

(10,229)

3,283

32%

659

9%

3,682

3,863

3,992

4,156

164

4%

129

3%

(8,763)

(11,469)

(10,938)

(14,385)

3,447

24%

531

5%

4,757

3,739

2,066

6,099

4,033

66%

(1,673)

-45%

Growth in Conference and Event Center volumes
33

Economic Development Division
Financial Trends

In 000s
35,000

Growth from 2017:
•
Revenue $2,914K, 16.4%
•
Expenses $2,255K, 8.9%

30,000
25,000
Depreciation

20,000

Allocation
*Program Expense

15,000

**Operating Expense

10,000

Revenue

5,000
2014

2015

2016

2017

2018 Actual

2018 Budget

Budget Variance Fav./(Unfav.):
•
Revenue $2,182K, 11.8%
•
Expenses $1,101K, 3.8%
Revenue - Growth and budget
favorability driven by Conference
& Event Center volumes.
Expenses - Underspend in
Program Expense offset by
volume related CEC cost.

(5,000)

* Includes Small Business, Tourism, Workforce Development, Real Estate Development, and Economic Development Grants.
** Includes Portfolio Management, Division Management, Facilities, and Other.

Growth in the Conference and Event Center (CEC)
34

Portfolio Management Trends
Growth from 2017:
•
Revenue $2,959K, 16.6%
•
Expenses $2,181K, 9.8%

in 000s
30,000

Budget Variance Fav./(Unfav.):
•
Revenue $2,242K, 12.1%
•
Expenses ($431K), -1.8%

25,000
20,000

Depreciation

Allocation

15,000

Operating Expense
10,000

Revenue

5,000
2016

2017

2018 Actual

2018 Budget

Conference and Event Center - volumes
driving favorable with revenues and
unfavorable expenses. Gross Operating
Margin $920K higher than budget at $2.6M
(23% vs. budget of 18%).
Expenses - Maintenance cost at Pier 66
higher than expected from HVAC updates.

Includes non-alliance & upland real-estate at Tsubota, T-91 (General), T-86, P-69, Bell Street Garage, Smith Cove Conference
Center, Bell Harbor Conference Center, World Trade Center, Foreign Trade Zone, Pier 2, T-34, and T-102

Increasing margins
35

Central Services
2018 Financial Performance Report

Central Services Business Highlights
•

The Port Commission approved funds to address the shortage of local construction workers and to
broaden access to training and jobs for underrepresented populations in the industry.

•

The Port Commission established policy directives on Diversity in Contracting, Priority Hire,
Construction Labor Practices in 2018.

•

Obtained Congressional authorization for Seattle Harbor Deepening Project with the U.S. Army Corps
of Engineers.

•

Hosted event to celebrate 10 year anniversary of the Port's Veteran Fellow Program.

•

Completed another successful summer High School internship program. Began to develop year-round
High School internship program.

•

Issued Intermediate Lien Revenue Bonds of $555,564,000 to finance or refinance capital
improvements to aviation facilities.

•

Received a regional Food Recovery Challenge Award from the U.S. Environmental Protection Agency
for outstanding accomplishments in preventing and diverting wasted food.

Achieved a number of accomplishments in 2018
37

Central Services Financial Summary
In 000s
160,000

Core Central Support Services

Police

Capital Development

•

Expense growth in 2018 compared
to 2017 was driven by:
o Rent and moving costs to
SeaTac Office Center.
o Higher payroll costs due to
merit increase and new
FTEs.
o Other expenses to support
Port goals and initiatives
and division priorities.

•

2018 Expenses are lower than
budget due to:
o Staffing vacancies
o DRS pension true-up credit
o Projects delay and actual
savings

Environment & Sustainability

140,000
120,000
100,000
80,000
60,000
40,000
20,000
0
2014

2015

2016

2017

2018 Actual

2018 Budget

Expenses came in $23.5M favorable to the budget in 2018
38

Appendix
2018 Financial Performance Report

Portwide Financial Summary
$ in 000's
Aeronautical Revenues
Airport Non-Aero Revenues
Other Port Operating Revenues
Total Operating Revenues

Total Operating Expenses
NOI before Depreciation
Depreciation
NOI after Depreciation

2016
Actual
244,235
221,021
133,211
598,467
325,285
273,182
164,336
108,846

2017
Actual
264,114
236,803
131,114
632,031
372,982
259,049
165,021
94,028

2018
Actual
291,268
257,707
140,415
689,390
397,638
291,752
164,362
127,390

2018
Budget
301,082
244,786
124,612
670,479
422,885
247,594
163,309
84,285

Fav (UnFav)
Incr (Decr)
Budget Variance Change from 2017
$
%
$
%
(9,814)
-3.3% 27,154
10.3%
12,921
5.3% 20,904
8.8%
15,803
12.7% 9,301
7.1%
18,910
2.8% 57,359
9.1%
25,247
6.0% 24,656
6.6%
44,158
17.8% 32,703
12.6%
(1,053)
-0.6%
(659)
-0.4%
43,105
51.1% 33,362
35.5%

Strong financial performance for the Port
40

Non-Airport Financial Summary
$ in 000's
NWSA Distributable Revenue
Maritime Revenues
EDD Revenues
SWU & Other
Total Operating Revenues

Total Operating Expenses
NOI before Depreciation
Depreciation
NOI after Depreciation

2016
Actual
61,584
50,810
15,903
4,914
133,211
64,059
69,152
41,837
27,315

2017
Actual
54,925
54,183
17,791
4,214
131,114
73,868
57,246
40,619
16,628

2018
Actual
55,992
57,575
20,705
6,143
140,415
78,789
61,626
40,159
21,467

2018
Budget
46,647
55,053
18,522
4,390
124,612
88,029
36,583
40,480
(3,897)

Fav (UnFav)
Incr (Decr)
Budget Variance Change from 2017
$
%
$
%
9,345
20.0% 1,067
1.9%
2,522
4.6% 3,391
6.3%
2,182
11.8% 2,913
16.4%
1,753
39.9% 1,929
45.8%
15,803
12.7% 9,301
7.1%
9,240
10.5% 4,921
6.7%
25,043
68.5% 4,380
7.7%
320
0.8%
(459)
-1.1%
25,364 -650.9% 4,839
29.1%

Strong financial performance for the Non-Aviation businesses
41

Portwide Operating Revenues Summary
$ in 000's
Aeronautical Revenues
Public Parking
Rental Cars - Operations
Rental Cars - Operating CFC
Rental Cars - Total
ADR & Terminal Leased Space
Ground Transportation
Employee Parking
Airport Commercial Properties
Airport Utilities
Clubs and Lounges
Cruise
Recreational Boating
Fishing & Operations
Grain
Maritime Portfolio Management
Central Harbor Management
Conference & Event Centers
NWSA Distributable Revenue
Other
Total Operating Revenues (w/o Aero)
TOTAL

2016
Actual
244,235
69,540
37,082
12,122
49,203
57,253
12,803
9,329
9,992
7,233
3,028
15,422
10,255
9,108
5,382
10,255
6,920
8,022
61,584
8,902
354,232
598,467

2017
Actual
264,114
75,106
35,051
10,641
45,691
58,980
15,684
9,617
18,042
7,018
5,041
17,596
11,086
9,297
5,427
10,787
8,634
9,133
54,925
5,854
367,917
632,031

2018
Actual
291,268
80,212
37,306
16,263
53,569
64,323
18,772
10,269
15,434
7,206
6,802
18,880
12,529
9,763
5,167
11,305
9,018
11,703
55,992
7,177
398,122
689,390

2018
Budget
301,082
78,572
35,294
15,563
50,857
59,087
16,884
9,457
14,706
7,556
5,630
18,150
12,166
8,388
5,163
11,169
8,951
9,537
46,647
6,477
369,398
670,479

Fav (UnFav)
Incr (Decr)
Budget Variance
Change from 2017
$
%
$
%
(9,814)
-3.3%
27,154
10.3%
1,640
2.1%
5,106
6.8%
2,012
5.7%
2,255
6.4%
700
4.5%
5,622
52.8%
2,713
5.3%
7,878
17.2%
5,236
8.9%
5,343
9.1%
1,888
11.2%
3,088
19.7%
813
8.6%
652
6.8%
727
4.9%
(2,608)
-14.5%
(350)
-4.6%
189
2.7%
1,171
20.8%
1,761
34.9%
730
4.0%
1,284
7.3%
362
3.0%
1,443
13.0%
1,375
16.4%
465
5.0%
4
0.1%
(260)
-4.8%
136
1.2%
518
4.8%
66
0.7%
384
4.4%
2,166
22.7%
2,570
28.1%
9,345
20.0%
1,067
1.9%
700
10.8%
1,324
22.6%
28,724
7.8% 30,205
8.2%
18,910
2.8% 57,359
9.1%

Operating revenues exceeded budget by $18.9M
42

Portwide Operating Expense Summary
$ in 000's
Salaries & Benefits
Wages & Benefits
Payroll to Capital Projects
Equipment Expense
Supplies & Stock
Outside Services
Utilities
Travel & Other Employee Expenses
Promotional Expenses
Other Expenses
Charges to Capital Projects
TOTAL

2016
Actual
102,873
99,917
21,744
7,106
8,792
70,116
21,123
4,200
1,178
25,118
(36,880)
325,285

Fav (UnFav)
Incr (Decr)
2018
2018 Budget Variance Change from 2017
2017
Actual Actual Budget
$
%
$
%
112,837 127,575 135,982
8,407
6.2% 14,738
13.1%
108,041 108,381 122,544 14,163 11.6%
340
0.3%
25,708 28,329 28,964
635
2.2%
2,621
10.2%
11,118 10,622
8,212 (2,411) -29.4%
(495)
-4.5%
10,238 10,781
8,800 (1,981) -22.5%
542
5.3%
83,603 99,885 112,292 12,407 11.0% 16,282
19.5%
23,529 25,552 24,219 (1,334) -5.5%
2,024
8.6%
4,767
4,848
6,398
1,550 24.2%
81
1.7%
1,408
1,956
2,341
385 16.4%
548
38.9%
36,483 31,911 28,045 (3,867) -13.8% (4,572) -12.5%
(44,750) (52,203) (54,910) (2,707)
4.9% (7,453) 16.7%
372,982 397,638 422,885 25,247
6.0% 24,656
6.6%

• Payroll expenses were
$22.5M below budget due to
staffing vacancies and a
$15.6M DRS Pension Trueup credit.
• Outside Services were
$12.4M favorable to budget
due to timing of spending,
project delays, and some
actual savings.
• Equipment Expense was
$2.4M over budget due to
more equipment rental and
office move.
• Utilities Expense was $1.3M
over budget mainly due to
higher Surface Water Utility
cost.

Operating expenses were $25.2M below budget
43

Comprehensive Financial Summary
($ in 000's)
Revenues
1. Operating Revenues
2. Tax Levy
3. PFCs
4. CFCs
5. Fuel Hydrant
6. Non-Capital Grants & Donations
7. Capital Contributions
8. Interest Income
Total
Expenses
1. O&M Expense
2. Depreciation
3. Revenue Bond Interest Expense
4. GO Bond Interest Expense
5. PFC Bond Interest Expense
6. Public Expense
7. Non-Op Environmental Expense
8. Other Non-Op Rev/Expense
Total
Special Item
Retro Adjustment to Net Position
Increase In Net Position

2016
Actual

2017
Actual

2018
Actual

2018
Budget

Fav (UnFav)
Budget Variance
$
%

598,467
71,678
85,570
24,715
6,992
6,284
18,108
8,448
820,262

632,031
71,702
88,389
25,790
7,000
6,705
30,112
12,174
873,902

689,390
71,771
94,070
21,802
6,942
1,573
43,650
26,287
955,484

670,479
72,000
91,787
22,161
7,023
5,504
41,379
15,713
926,047

18,910
(229)
2,283
(359)
(82)
(3,931)
2,271
10,573
29,438

2.8% See details in the previous slides
-0.3% In line with budget
2.5% Higher enplanements and PFC eligible enplanements
-1.6% In line with budget
-1.2% In line with budget
-71.4% Less DOE grants than budgeted
5.5% Tiger grant construction spending was lower than anticipated
67.3% Budget did not include interest earnings on new bond proceeds
3.2%

325,285
164,336
105,567
9,765
5,251
8,560
280
12,087
631,131
147,700
41,431

372,982
165,021
97,748
13,891
4,931
4,588
4,464
10,441
674,066
199,836

397,638
164,362
100,432
13,414
4,368
5,269
10,600
3,217
699,299
34,923
2,736
218,526

422,885
163,309
122,544
13,501
4,437
10,794
2,250
473
740,193
185,854

25,247
(1,053)
22,111
88
69
5,525
(8,350)
(2,744)
40,893
(34,923)
(2,736)
32,673

6.0% See details in the previous slides
-0.6% More new assets came into services
18.0% Savings from new bonds and lower cost of issuance than budgeted
0.6% In line with budget
1.5% In line with budget
51.2% Safe & Swift and Heavy Haul did not take place as budgeted
-371.1% ERL increase primarily from T91 and Lower Duwamish Superfund
-580.5% Mainly due to loss sale of assets
5.5%
0.0% T25 NRD restoration project
0.0% GASB 75 Retro Adj to OPEB Life
17.6%

Explanation

Strong financial performance for the Port
44

Capital Spending by Division
$ in 000's

2017
Actual

2018
Actual

2018
Budget

Aviation

294,497

579,135

795,883

Budget Variance
$
%
216,748 27.2%

Maritime

20,489

25,091

46,449

21,358

46.0%

Economic Development

3,739

2,066

6,099

4,033

66.1%

Central Services & Other (note 1)

5,798

11,456

26,779

15,323

57.2%

324,523

617,748

875,210

257,462

29.4%

TOTAL

Note:
(1) "Other" includes $1.7M Stormwater Utility capital projects.

2018 capital spending was $617.7M
45

Aviation Division
Appendix

Airport Activity
2016

2017

2018

% Change
from 2017

Total Passengers (000's)
Domestic
International
Total

40,871
4,866
45,737

41,804
5,130
46,935

44,422
5,428
49,850

6.3%
5.8%
6.2%

Operations

412,170

416,124

438,391

5.4%

Landed Weight (In Millions of lbs.)
Cargo
All other
Total
Cargo - Metric Tons
Domestic freight
International freight
Mail
Total

1,888
25,387
27,276

2,323
26,107
28,431

2,471
27,879
30,350

6.4%
6.8%
6.8%

194,754
114,350
57,326
366,430

242,271
123,934
59,651
425,856

241,397
133,274
57,644
432,315

-0.4%
7.5%
-3.4%
1.5%

Passenger Activity
Airline
Alaska
Delta
United
Southwest
American

Change
2017 v. 2018
4.6%
10.5%
6.0%
2.3%
1.7%

2018 Market
Share
48.9%
23.1%
6.4%
6.4%
5.6%

Q4 2018:
Passengers
• YTD passenger growth of
6.2% tracking well ahead
of 2018 budget based on
5.0% growth.
• Top five carriers all
growing vs. 2017

2018 total passenger growth of 6.2%
47

Aviation Financial Summary
Fav (UnFav)
Budget Variance
$
%

Incr (Decr)
Change from 2017
$
%

2016
Actual

2017
Actual

2018
Actual

2018
Budget

247,811

267,690

291,268

301,082

(9,814)

-3.3%

23,578

8.8%

(3,576)

(3,576)

-

-

-

0.0%

3,576

-100.0%

Aeronautical Revenues

244,235

264,114

291,268

301,082

(9,814)

-3.3%

27,154

10.3%

Non-Aeronautical Revenues

221,021

236,803

257,707

244,786

12,921

5.3%

20,904

8.8%

Total Operating Revenues

465,256

500,916

548,975

545,867

3,107

0.6%

48,058

9.6%

Total Operating Expense

261,226

299,114

318,849

334,856

16,007

4.8%

19,735

6.6%

Net Operating Income

204,030

201,802

230,126

211,011

19,114

9.1%

28,324

14.0%

Capital Expenditures

153,887

293,785

579,135

796,200

217,065

27.3%

285,350

97.1%

$ in 000's
Operating Revenues:
Gross Aeronautical Revenues
SLOA III Incentive Straight Line Adj

(1)

(1) Annual non-cash amortization of $17.9M lease incentive related to the 5 year SLOA III agreement which ended in 2017.

2018 Actual NOI $19.1M favorable to budget
48

Key Performance Measures
2018 Actual vs. 2018 Budget
Key Performance Metrics

Fav (UnFav)

Incr (Decr)

Budget Vairance

Change from 2017

2016

2017

2018

2018

Actual

Actual

Actual

Budget

$

Key Performance Metrics
Cost per Enplanement (CPE)
Non-Aeronautical NOI (in 000's)

10.10
128,727

10.52
133,101

10.79
149,959

11.63
126,607

Other Performance Metrics
O&M Cost per Enplanement
Non-Aero Revenue per Enplanement
Debt per Enplanement (in $)
Debt Service Coverage
Days cash on hand (10 months = 304 days)
Aeronautical Revenue Sharing ($ in 000's)

11.46
9.70
104
1.53
416
(37,395)

12.77
10.11
114
1.57
379
(42,311)

12.81
10.35
133
1.66
235
(36,863)

Activity (in 000's)
Enplanements

22,796

23,416

24,894

%

$

%

0.84
23,352

7.2%
18.4%

0.26
16,858

2.5%
12.7%

13.58
9.93
116
1.51
304
(35,799)

0.77
0.42
(17)
0.15
-69
(1,065)

5.7%
4.3%
-14.8%
9.7%
-22.6%
-3.0%

0.03
0.24
19
0.08
(144)
5,447

0.3%
2.4%
16.3%
5.3%
-37.9%
12.9%

24,654

240

1.0%

1,479

6.3%

CPE:
• CPE - Impacted by SLOA IV
reduction in Revenue Sharing to
40% from 50%
• 2018 Actual CPE of 10.79 is
favorable to Adjusted Budget
CPE of $11.63 (Original budget
$11.35, adjusted consistent with
revenue sharing from SLOA IV)
driven by increased non-airline
revenues generating more
revenue sharing
Non-Aero NOI:
• Non-Aero NOI growth due to
both higher Non-Aero Revenue
and lower Operating Expenses
primarily due to schedule delays

Positive: Non-aero NOI above budget. CPE below adjusted budget.
49

Aviation Expense YE Summary
2016
Actual

2017
Actual

2018
Actual

2018
Budget

Fav (UnFav)
Budget Variance
$
%

101,879
37,863
14,690
20,655
175,087

114,463
41,055
16,374
28,292
200,184

125,341
47,638
18,237
25,125
216,341

132,156
52,532
17,320
19,776
221,784

6,815
4,895
(918)
(5,349)
5,443

Environmental Remediation Liability
Capital to Expense
Total Exceptions

4,463
129
4,592

8,812
2,856
11,668

6,233
6,891
13,124

4,030
4,030

Total Airport Expenses
Police Costs
Capital Development
Other Central Services
Maritime/Economic Development
Total Charges from Other Divisions

179,679
18,183
9,319
50,099
3,946
81,547

211,852
17,652
14,701
51,004
3,904
87,262

229,465
19,231
12,607
53,121
4,425
89,384

225,814
22,174
23,092
58,265
5,511
109,042

(3,651)
2,944
10,485
5,144
1,086
19,658

-1.6%
13.3%
45.4%
8.8%
19.7%
18.0%

17,613
1,579
(2,094)
2,117
520
2,122

8.9%
-14.2%
4.1%
13.3%
2.4%

Total Operating Expense
Net Operating Income

261,226
204,030

299,114
201,802

318,849
230,126

334,856
211,011

16,007
19,114

4.8%
9.1%

19,735
28,324

6.6%
14.0%

$ in 000's
Operating Expenses:
Payroll
Outside Services
Utilities
Other Airport Expenses
Total Airport Direct Charges

Incr (Decr)
Change from 2017
$
%

5.2%
9.3%
-5.3%
-27.0%
2.5%

10,878
6,583
1,864
(3,168)
16,157

9.5%
16.0%
11.4%
-11.2%
8.1%

(2,203)
-54.7%
(6,891)
0.0%
(9,094) -225.7%

(2,579)

-29.3%

4,035
1,456

141.3%
12.5%
8.3%

2018 Actual to 2018 Budget
Operating Expenses favorable
$16M due to:
• Total Airport Expenses higher by
($3.7M) primarily due to the
following Expense Exceptions:
• Increase in ERL expense
($2.2M) primarily due to
remediation required for
IAF& NSAT mega projects
• Capital to Expense writeoffs ($6.9M)
• Partially offset by impact of
Pension Credit to Airport
$5.5M.
• Savings from other divisions
$19.7M including schedule
delays for planned expense
projects. Note: Impact of

Pension Credit to Corporate and
other divisions was $7.2M

Unplanned expenses mostly absorbed by cost savings
50

Impact of 2018 Special Items
The following items impacted the CPE and
Non-Aero NOI:
• Year-End Credit Pension Adjustment for
$12.7M which impacted the CPE lower by
approximately $0.40
• Capital to Expense Write-offs for $5.2M
which impacted the CPE higher by
approximately $0.24
• IAF RMM (Soil & Asbestos) for $3.8M
which impacted the CPE higher by
approximately $0.13
In other words, without the impact of these
Special Items the CPE is estimated to be at
10.81 vs 10.79

Breakdown of the impact of 2018 Special Items
51

Aeronautical Business YE
Fav (UnFav)
Budget Variance

2016

2017

2018

2018

$ in 000's
Revenues:
Movement Area
Apron Area
Terminal Rents
Federal Inspection Services (FIS)
Total Rate Base Revenues

Actual

Actual

Actual

Budget

$

%

94,725
14,028
155,852
11,227
275,832

108,638
16,771
155,431
18,612
299,452

116,703
15,627
169,318
16,226
317,874

125,422
15,979
171,854
13,413
326,668

(8,720)
(352)
(2,536)
2,813
(8,794)

Commercial Area
Subtotal before Revenue Sharing

9,379
285,211

10,574
310,026

10,257
328,131

10,212
336,880

Revenue Sharing

(37,395)

(42,311)

(36,863)

Other Prior Year Revenues
Total Aeronautical Revenues

(5)
247,811

(26)
267,690

Total Aeronautical Expenses

168,932

195,414

Net Operating Income
(1)

Debt Service
Net Cash Flow

Incr (Decr)
Change from 2017
$

%

-7.0%
-2.2%
-1.5%
21.0%
-2.7%

8,064
(1,144)
13,888
(2,386)
18,422

7.4%
-6.8%
8.9%
-12.8%
6.2%

45
(8,749)

0.4%
-2.6%

(317)
18,106

-3.0%

(35,799)

(1,065)

-3.0%

5,447

12.9%

291,268

301,082

(9,814)

0.0%
-3.3%

26
23,578

100.0%

211,101

216,931

5,830

2.7%

15,688

8.0%

5.8%

8.8%

78,879

72,276

80,167

84,151

(3,984)

-4.7%

7,891

10.9%

(89,130)
(10,251)

(86,564)
(14,288)

(91,673)
(11,506)

(90,323)
(6,173)

(1,350)
(5,333)

-1.5%
-86.4%

(5,109)
2,782

19.5%

-5.9%

2018 Actual to Budget
Revenue - $8.8M unfavorable
• Rate based revenue $8.8 M
lower-driven primary by
decreases in Debt Service
flowing through Rates in the
Movement and Terminal Rents
areas.
• Revenue sharing $1M - higher
primarily driven by lower
revenue requirement as a
result of pension credit
Expenses - $5.8M favorable
• Driven primarily by the $12.7 M
Pension Year End credit
adjustment, which absorbed
increased costs in Capital to
Expenses.

(1) 2018 Budget debt service amount inadvertently understated by the $2.1M debt service exclusion adjustment which impacts Aero Rate Based Revenues only.
Total 2018 Aeronautical debt service obligation is reflected in the 2018 Forecast column.

Higher Aeronautical revenues due to lower revenue sharing percentage
52

Aero Cost Drivers
2018 Actual to 2018
Budget

$ in 000's

2016
Actual

2017
Actual

O&M
Debt Service Gross
Debt Service PFC Offset
Amortization
Space Vacancy
TSA Operating Grant and Other
Rate Base Revenues
Commercial area
Total Aero Revenues

165,427
192,188
118,641
113,832
(32,831) (33,057)
28,215
29,654
(2,638)
(2,264)
(982)
(901)
275,832 299,452
9,379
10,574
285,211 310,026

2018
Actual

2018
Budget

206,076
115,419
(32,987)
32,371
(2,132)
(873)
317,874
10,257
328,131

210,433
120,555
(33,015)
32,373
(2,650)
(1,028)
326,668
10,212
336,880

Fav (UnFav)
Budget Variance
$

%

(4,357) -2.1%
(5,135) -4.3%
28 -0.1%
(2) 0.0%
518 -19.5%
155 -15.1%
(8,794) -2.7%
45 0.4%
(8,749) -2.6%

(1) O&M , Debt Service Gross, and Amortization do not include commercial area costs or the international incentive expenses

Incr (Decr)
Change from 2017
$

%

13,888
1,588
70
2,717
132
28
18,422
(317)
18,106

7.2%
1.4%
-0.2%
9.2%
-5.8%
-3.1%
6.2%
-3.0%
5.8%

•

•

O&M cost driver of overage
is due to Environmental
Remediation Liability
($3.1M)
Debt Service - $5.1M lower
due to increased debt
service exclusions from
rate base due to project
delays - NS NSAT Renov
($1.1M), Concourse D
Hardstand Holdroom
($940K), Holdroom
Seatings for Con. B & C
($312K), Terminal Security
Enhancements ($201K)
and increased interest on
reserve fund ($574K) and
savings from commercial
paper interest ($687K)

Aero rate base revenues based on cost recovery formulas
53

Aero Revenue Sharing
2016
2017
2018
2018
$ in 000's
Actual
Actual
Actual
Budget
Aero Revenues (incl' commercial) 285,211
310,026
328,131
336,880
Non-Aeronautical Revenues
221,021
236,803
257,707
244,786
Total O&M Expenses
(261,226) (299,114)
(318,849)
(334,612)
Net Operating Income
245,006 247,714 266,989
247,054
ADF Interest Income
3,725
4,242
3,752
4,127
Security Checkpoint TSA Grant
916
1,039
1,001
1,028
Misc. Non-Operating Expenses
(2,481)
(1,799)
(1,586)
(750)
CFC Excess
(4,899)
(2,750)
(7,724)
(7,142)
Available for Debt Service
[a]242,267 248,446 262,433
244,318
Debt Service
Debt Service x 1.25

Fav (UnFav)
Budget Variance

Incr (Decr)
Change from 2017

$
%
(8,749) -2.6%
12,921 5.3%
15,763 -4.7%
19,935 8.1%
(375) -9.1%
(27) -2.6%
(837) 111.7%
(582) 8.1%
18,114 7.4%

$
18,106
20,904
(19,735)
19,275
(490)
(38)
213
(4,974)
13,987

%
5.8%
8.8%
6.6%
7.8%
-11.5%
-3.6%
-11.8%
180.9%
5.6%

133,982
[b]1 67,477

131,060
163,825

136,218
170,273

138,177
172,721

(1,958) -1.4%
(2,448) -1.4%

5,159
6,448

3.9%
3.9%

Available for revenue sharing [c]=[a]-[b]
74,790

84,621

92,159

71,597

20,562

28.7%

7,539

8.9%

(1)
[d]=[c]*0.5
37,395
42,310

36,864

35,799

1,065

3.0%

(5,447)

-12.9%

Revenue Sharing

Lower revenue sharing percentage due to SLOA IV (40%)
54

Non-Aeronautical Business YE
Fav (UnFav)
Budget Variance
$
%

Incr (Decr)
Change from 2017
$
%

2016
Actual

2017
Actual

2018
Actual

2018
Budget

35,051
10,641
75,106
15,684
58,980
18,042
7,018
9,617
5,041
1,624
236,803
103,702

37,306
16,263
80,212
18,772
64,323
15,434
7,206
10,269
6,802
1,119
257,707
107,748

35,294
15,563
78,572
16,884
59,087
14,706
7,556
9,457
5,630
2,036
244,786
117,925

2,012
700
1,640
1,888
5,236
727
(350)
813
1,171
(917)
12,921

Total Non-Aero Expenses

37,082
12,122
69,540
12,803
57,253
9,992
7,233
9,329
3,028
2,639
221,021
92,294

10,177

8.6%

4,046

3.9%

Net Operating Income

128,727

133,101

149,959

126,861

Less: CFC (Surplus) / Deficit (1)
Adjusted Non-Aero NOI
(1)
Debt Service
Net Cash Flow

(4,899)
123,828
(43,984)
79,844

(2,750)
130,351
(44,495)
85,856

(7,724)
142,235
(44,545)
97,690

(7,142)
119,719
(45,752)
73,967

23,098
(582)
22,516
1,207
23,723

18.2%
-8.1%
18.8%
2.6%
32.1%

16,858
(4,974)
11,884
(50)
11,834

12.7%
-180.9%
9.1%
-0.1%
13.8%

$ in 000's
Non-Aero Revenues
Rental Cars - Operations
Rental Cars - Operating CFC
Public Parking
Ground Transportation
Airport Dining & Retail & Leased Space
Commercial Properties
Utilities
Employee Parking
Clubs and Lounges
Other
Total Non-Aero Revenues

(1) CFC excess and Debit service are forecasted/budgeted on an annual basis only. Thus, quarterly data is not available.

5.7%
4.5%
2.1%
11.2%
8.9%
4.9%
-4.6%
8.6%
20.8%
-45.0%
5.3%

2,255
5,622
5,106
3,088
5,343
(2,608)
189
652
1,761
(505)
20,904

6.4%
52.8%
6.8%
19.7%
9.1%
-14.5%
2.7%
6.8%
34.9%
-31.1%
8.8%

2018 Actual to 2018 Budget
Revenue - favorable $12.9M
• Airport Dining & Retail - strong
performance despite unit closures for
lease transition.
• Ground Transportation -continued
strong growth in TNC activity
• Public Parking - strong growth in 1+
day transactions
Expenses - favorable $11.5M
• Savings from other Divisions - Delays
for ADR tenant buildouts and other
Terminal projects
• Payroll savings - due to Non-Aero
share of pension credit, in addition to
savings from staffing vacancies.
• Unplanned expenses absorbed by
above savings include peak contract
staffing support, SP Plus taxi curbside
service Landside honey bucket cost,
and lower payroll charges to capital.

$24.4M NOI growth due to both higher revenues and deferred expenses
55

Public Parking Performance YE
Public Parking - Revenue Detail

Fav / (UnFav)

Incr / (Decr)

2017
Actual

2018
Actual

2018
Budget

Budget Variance

Change from 2017

$

%

$

%

81,404
(6,818)
(6,563)
68,024

86,974
(7,248)
(7,251)
72,476

87,112
(7,102)
(7,196)
71,022

(139)
(145)
(55)
1,454

-0.2%
2.0%
0.8%
2.0%

5,569
(430)
(688)
4,452

6.8%
6.3%
10.5%
6.5%

958
2,990
3,947
71,971

1,225
3,219
4,444
76,920

976
3,356
4,331
75,353

250 25.6%
(137) -4.1%
113 2.6%
1,567 2.1%

268
229
497
4,949

28.0%
7.7%
12.6%
6.9%

3,109
25

3,238
53

3,200
19

38
1.2%
35 182.1%

69,540

75,106

80,212

78,572

1,640

Fav / (UnFav)

Incr / (Decr)

2016
Actual
1,646
677
2,323

2017
Actual
1,623
684
2,307

2018
Actual
1,612
734
2,346

2018
Budget
1,639
690
2,329

Budget Variance

Change from 2017

2016
Actual

$ in 000's
Parking Garage Revenue to Port
Gross Sales - Parking Garage
73,707
less - WA Sales Tax
(6,081)
less - SeaTac Parking Tax
(4,212)
Revenue to Port - General Parking
63,414
Other Garage Revenue Programs
Corporate Premier Parking Program
594
Passport Parking Program
2,749
Revenue to Port - Parking Programs
3,344
Total Parking Garage Revenue
66,758
Other Parking Revenue
Concession Rent - Doug Fox off-site parking 2,751
Space Rent and Other Parking Revenue
32
Total Parking Revenue
Parking Transactions by duration

2.1%

5,106

6.8%

$
(11)
51
40

%
-0.7%
7.4%
1.7%

Total Enplanements
22,796
23,416
24,894
24,654
240 1.0%
1,479
O&D %
69.4%
70.3%
70.3%
69.2%
1.1% 1.6%
O&D Enplanements
15,821
16,461
17,501
17,061
440 2.6%
1,040
Garage Revenue per O&D Enplanement$ 4.22 $ 4.37 $ 4.40 $ 4.42 $ (0.02) -0.5% $ 0.02

6.3%
0.0%
6.3%
0.5%

in 000's
Parking < 1 day
Parking 1+ days
Total Parking Transactions

$
%
(26) -1.6%
44 6.4%
18 0.8%

129
4.2%
28 111.2%

Key message:
•Parking revenue growth
primarily driven by rate increase.
Overall growth in parking
transactions is slower than
growth in O&D enplanements.
2018 Actuals vs. 2017 Actuals
• Revenue - Increase compared
to prior year, primarily due to
tariff rate increase in effect
full year 2018 (rate increase
effective April 2017).
• Transactions - Increase in
total parking transactions
reflects slower growth rate
than the growth in O&D
enplanements, and reflects
impact of increasing number
of transportation alternatives
available to passengers.

Slower growth in parking transactions reflects increasing transportation alternatives
56

Rental Car Performance YE
Rental Car - Revenue Detail

Fav / (UnFav)

Incr / (Decr)

2015
Actual

2016
Actual

2017
Actual

2018
Actual

2018
Budget

Budget Variance

Change from 2017

# and $ in 000's

2014
Actual

$

%

$

RCF Concession Revenue to Port

28,955

30,662

33,465

31,352

33,474

31,508

1,965

6.2%

2,122

6.8%

Total Enplanements
O&D %
O&D Enplanements

18,717
73.8%
13,813

21,109
69.8%
14,734

22,796
69.4%
15,821

23,416
70.3%
16,461

24,894
70.3%
17,501

24,654
69.2%
17,061

240
1.1%
440

1.0%
1.6%
2.6%

1,479
1,040

6.3%
0.0%
6.3%

Gross Sales by Operators
Total Transactions
Average Ticket
Average Length of Stay
Transactions/O&D Enplanements

281,884 302,372 310,987 313,654 334,355 315,083
1,218
1,289
1,390
1,411
1,416
1,437
$231.34 $234.53 $223.70 $222.32 $ 236.08 $219.22
4.23
4.10
4.00
4.28
4.44
4.37
7.70%
8.75%
8.79%
8.57%
8.09%
8.42%

19,271
(21)
16.86
0.06
-0.33%

6.1%
-1.5%
7.7%
1.5%
-3.9%

20,700
5
$13.76
0.16
-0.48%

6.6%
0.4%
6.2%
3.7%
-5.6%

CFC Revenue Summary
Total Transaction Days
CFC Rate per Transaction Day
Total CFC Revenue Earned
Reserve for debt service and CP interest:
Reserve for CP principal payment:
Debt Service Reserve Requirement
Residual - CFC Operating Revenue:

5,150
$6.00
33,554
(19,946)
(19,946)
13,608

5,292
5,554
$6.00
$6.00
36,206
36,830
(20,543) (21,708)
(3,000) (3,000)
(23,543) (24,708)
12,663
12,122

6,039
$6.00
36,261
(22,621)
(3,000)
(25,621)
10,641

6,286
$6.00
37,716
(21,802)
(21,802)
16,263

6,287
$6.00
37,723
(22,161)
(22,161)
15,563

(1)
$0.00
(7)
359
359
700

0.0%
0.0%
0.0%
-1.6%
NA
-1.6%
4.5%

247
$0.00
1,455
819
3,000
3,819
5,622

4.1%
0.0%
4.0%
-3.6%
-100.0%
-14.9%
52.8%

Fav / (UnFav)

Incr / (Decr)

2016
Actual
30,662
12,663
3,189

2016
Actual
33,465
12,122
3,617

2017
Actual
31,352
10,641
3,699

2018
Actual
33,474
16,263
3,833

2018
Budget
31,508
15,563
3,786

Budget Variance

Change from 2017

# and $ in 000's
RCF Concession Revenue to Port
Residual - CFC Operating Revenue:
Land Rent/Space Rent/Other

2016
Actual
28,955
13,608
3,541

$
1,965
700
47

%
6.2%
4.5%
1.2%

$
2,122
5,622
133

%
6.8%
52.8%
3.6%

Total Rental Cars Oper Revenue

46,104

46,515

49,203

45,691

53,569

50,857

2,713

5.3%

7,878

17.2%

Rental Car - Revenue Summary

%

Key message:
•Rental Car revenue reflects strong growth in
average ticket price during 2018, which offsets
continued decline in 1 day car rentals impacted by
availability of other transportation alternatives
(TNCs, car-sharing, light rail, etc.)
2018 Actuals vs. 2017 Actuals

Rental Car Concession revenue - . Concession
Revenue is impacted by (3) key indicators:
• Decline in Transactions per O&D Enplanement
reflects trend in passenger preference shifting
to other transportation options
• Total Transactions almost flat, which reflects
net impact of decline in 1 day rentals offset by
some growth in longer term rentals.
• Average ticket price is a function of rental car
pricing and customer demand, and can vary
significantly. Higher average ticket price in
2018 reflects both decline in 1 day rentals and
strong pricing in current market .
• CFC Operating Revenue - Increase due to
increase in Transaction Days for 2018 and lower
debt service in 2018, primarily driven by final
payment on outstanding Commercial Paper
balance ($3.0M) paid last year.

Rental Car revenue strong despite increasing transportation alternatives
57

Ground Transportation YE
Revenue to Port
$ in 000's
Ground Transportation Revenues
Transportation Network Companies
On Demand Taxis
On Demand Limos
Belled In Taxis (Annual Permit)
Pre-Arranged Limos (Annual Permit)
Courtesy Cars (cost recovery)
All other Operators (cost recovery)
Other Misc Revenues
Total GT Revenue

Incr / (Decr)
Change from 2017

2017

2018

2018

Actual

Actual

Actual

Budget

$

8,122
4,591
855
108
603
1,909
433
264
16,884

2,228
27.4%
(115)
-2.5%
(2)
-0.2%
(73) -67.6%
32
5.3%
(249) -13.0%
(133) -30.7%
201
76.0%
1,888
11.2%
Fav / (UnFav)

Incr / (Decr)

2018
Budget

Budget Variance

Change from 2017

3,222
5,045
869
159
496
2,039
669
305
12,803

6,940
5,199
858
45
626
1,319
360
337
15,684

10,349
4,475
853
35
635
1,660
300
465
18,772

Trip Activity
in 000's
Ground Transportation Trips
Transportation Network Companies
On Demand Taxis
On Demand Limos
Belled In Taxis (Annual Permit)
Pre-Arranged Limos (Annual Permit)
Courtesy Cars (cost recovery)
All other Operators (cost recovery)
Total GT Trip Activity

Fav / (UnFav)
Budget Variance

2016

2016
Actual
602
827
74
195
369
1,221
95
3,383

2017
Actual
1,277
750
72
56
337
1,200
79
3,771

2018
Actual
1,715
723
69
18
347
1,209
63
4,145

1,354
765
71
52
325
1,211
78
3,856

%

#

%

362
(42)
(1)
(34)
22
(2)
(16)
290

26.7%
-5.4%
-2.0%
-64.8%
6.9%
-0.2%
-20.0%
7.5%

$

%

3,410
49.1%
(724) -13.9%
(5)
-0.6%
(10) -22.3%
9
1.4%
341
25.9%
(60) -16.7%
127
37.8%
3,088
19.7%

#

%
438
(27)
(2)
(38)
10
9
(16)
374

34.3%
-3.6%
-3.0%
-67.2%
3.0%
0.7%
-20.5%
9.9%

Key message:
•Strong growth in demand for TNCs continues in
2018. Significant changes in customer preferred
ground transportation alternatives are reflected in
both revenue and trip activity between GT operator
categories.
2018 Actuals vs. 2017 Actuals
GT Revenue compared to prior year:
• TNC revenue in 2018 reflects continued shift in
customer preference and the impact of the rate
increase (to $6/trip) effective for the full year
• Taxi revenue decline partially due to rate
decrease (to $6/trip) effective all year in 2018,
compared to $7/trip in effect for the first 9
months of 2017
• Courtesy car revenue increase reflects rate
correction in 2018 Budget
GT Trip Activity forecast compared to prior year:
• TNC trip volume continued to grow at a rate
faster than the growth in enplaned passengers,
driven by shift in customer preference
• Taxi trip decline slowed in 2018. Future
demand still uncertain.
• Declines in other operator categories reflects
the changing GT operating environment

TNC growth expected to continue to outpace enplanement growth
58

Airport Dining & Retail/Terminal Leased Space YE
Airport Dining & Retail and Terminal
Leased Space
Org Basis (in 000's)
ADR Revenue
Food & Beverage 1

2016
Actual

2017
Actual

2018
Actual

2018
Budget

Fav / (Unfav) Budget
Variance

$

Incr / (Decr)
Change from 2017

%

$

%

21,314

21,579

23,132

21,700

1,433

6.6%

1,553

7.2%

Retail 1

13,496

13,989

17,005

14,344

2,661

18.6%

3,016

21.6%

Duty Free 1

6,265

6,912

7,026

7,251

(225)

-3.1%

114

1.6%

Personal Services 1

3,657

3,728

3,951

3,809

142

3.7%

223

6.0%

Advertising

6,725

6,662

6,432

6,021

410

6.8%

(231)

-3.5%

Space Rental - Terminal

5,190

5,641

6,415

5,664

751

13.3%

774

13.7%

605
57,252

469
58,980

363
64,323

300
59,087

63
5,236

21.0%
(106)
8.9% 5,343

-22.6%
9.1%

2,241
55,010

1,962
57,018

2,778
61,545

2,423
56,664

(355)
4,881

-14.6%
816
8.6% 4,527

41.6%
7.9%

Sales per Enplanement
SPE - Food & Beverage
SPE - Retail Sales
SPE - Duty Free
SPE - Personal Services
SPE - Airport Dining & Retail

$7.23
$3.86
$0.89
$1.00
$12.98

$7.18
$4.07
$0.91
$0.95
$13.12

$7.34
$4.37
$0.83
$0.94
$13.49

$6.93
$4.03
$0.90
$0.95
$12.82

$0.41
$0.34
($0.06)
($0.01)
$0.68

5.9% $0.16
8.4% $0.30
-7.2% ($0.07)
-0.8% ($0.01)
5.3% $0.37

2.2%
7.3%
-8.1%
-1.1%
2.8%

Concession Revenue 1
per Enplanement

$1.96

$1.97

$2.05

$1.91

$0.14

7.5% $0.08

4.0%

All other revenue
Total ADR & Terminal Lease Revenue
Expenses
ADR & Terminal Leased Space
Income from Operations

•2018 Actuals vs. 2018 Budget
•Strong ADR sales despite planned
unit closures
•Revenue - favorable $3.3M
• Food & Beverage - Sales lost from
closure of Central Terminal were
captured by temporary
concessions as well as permanent
tenants.
• Retail - strong performance due to
Convenience Retail offering
increased "grab'n'go" food
options, and Specialty Retail
located away from Central
Terminal experiencing increased
traffic during peak times due to
crowding in holding areas
• Duty Free - flat sales most of the
year primarily due to China
increased enforcement of duty free
limitations. Strong dollar to Yaun
in second half of year also
contributed to restrained sales

(1) Concession Revenue is composed of revenue from concession agreements for the sales of Food & Beverage, Retail, Duty Free, and Personal Services only.

Strong ADR sales in 2018, despite unit closures for planned lease transition
59

Commercial Properties YE
Non-Aero Commercial Properties
Org Basis (in 000's)
New Development Revenue
Option Area Rent
Phase I - Base Rent
Phase I - In-lieu Fees
Phase II - Base Rent
Phase II - In-lieu Fees
Phase III - Base Rent
Phase III - In-lieu Fees
208th St. Rent Credit (Phase I)
DMCBP Owner's Liaison Reimb
NERA 2 Land Rent
NERA 3 Land Rent
Subtotal - New Development Revenue

2016
Actual

2017
Actual

2018
Actual

2018
Budget

593
259
377

593
259
29

29
372
221
17
30
69
(450)
288

27
674
239
29
5,434
349
206
15
42
7,015

248
687
2,973

582
223
248
678
2,611

In-flight Kitchen Revenue
NERA 3 Grant Revenue

7,025
908
-

7,827
1,402
-

8,705
1,807

8,054
2,070
-

All other Non-Aero Commercial Properties revenue
Non-Aero Commercial Properties Revenue

1,771
9,992

1,798
18,042

1,949
15,433

1,972
14,706

179

179

179

179

179
3,578
167
3,924

167
346

987

1,598

2,105

434
1,692
8,300

406
5,928
12,114

209
2,661
12,773

DMCBP Expenses
Phase I prepaid frontage fee amort.
Phase II prepaid frontage fee amort.
Phase III prepaid frontage fee amort.
Subtotal - New Development Expenses
NERA 3 Grant expenses
All other Commercial Properties expenses
Non-Aero Commercial Properties Expenses
Income from Operations

586
223

Fav / (Unfav) Budget Incr / (Decr) from
Variance
2017
$
%
$
%
0
(0)
348
4
0
(0)
9
364

0.0%
0.0%
0.0%
1172.8%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
0.0%
13.9%

(27)
n/a
(81) -12.0%
20
8.3%
348 1199.4%
(5,434)
n/a
237
67.8%
17
8.5%
n/a
n/a
233 1525.8%
646 1547.4%
(4,042) -57.6%

651
(263)
(23)
663

6.2%
-11.2%

878
405
-

11.2%
28.8%
n/a

0.0%
4.5%

151
(2,609)

8.4%
-14.5%

167
346

-

0.0%
0.0%
0.0%
7.2%

(3,578)
(3,578)

0.0%
n/a
0.0%
-91.2%

2,300
614
3,260
11,446

195
405
600
1,327

-11.2%

507
(197)
(3,267)
658

31.7%
n/a
-48.4%
-55.1%
5.4%

-20.2%
-11.0%
8.9%

Key message:
• 2018 Actuals vs. 2017 Actuals
Growth in revenue from new real estate
development and In-flight Kitchen revenue,
more than offset by one-time lump sum
payment for DMCBP Phase II frontage fees
received in prior year
2018 Budget vs. 2018 Actuals
Revenue - $0.7M Favorable
• DMCBP Phase II construction completed
earlier than expected.
• In-flight Kitchen revenue growth
continued in 2018
• NERA grant completed in 2018, partially
offset by higher than anticipated work
completed in prior year.
Expenses - $0.6M Favorable
• NERA grant expenses lower than
expected due to increased work
completed in prior year.
• Airport appraisals completed at lower
cost
• Savings in landscaping costs and other
small expenses

Revenue growth from new development & In-flight Kitchen, offset by $5.4M lump sum for DMCBP II frontage fees in received 2017

60

2018 Capital Expenditures
$ in 000's
Description
International Arrivals Facility (1)
ASL Conversion at Checkpoints (2)
NS NSAT Renov NSTS Lobbies (3)
N. Terminals Utilities Upgrade (4)
Add'l Baggage Makeup Space IAF (5)
Additional STS Cars (6)
2018 Taxiway Improvement Project (7)
SSAT Infrastructure HVAC
Concourse D Hardstand Holdroom
Holdroom Seatings for Conc B&C
Terminal Security Enhancements
All Other
Total Spending

2018
Actual
223,714
1,593
169,018
417
1,187
3
30,495
819
25,757
1,115
1,888
123,128
579,135

2018
Budget Variance
Budget
$
%
324,221 100,507 31.0%
16,800
15,207 90.5%
140,738
(28,280) -20.1%
8,200
7,783 94.9%
15,998
14,811 92.6%
6,525
6,522 100.0%
36,250
5,755 15.9%
4,910
4,091 83.3%
27,986
2,229 8.0%
6,950
5,835 84.0%
5,925
4,037 68.1%
201,380
78,252 38.9%
795,883 216,748 27.2%

(1) Foundations and structural steel delayed and then
proceeded at a slower pace than expected.
(2) $8.7M of capital budget deemed to be public
expense as the equipment will be transferred to
TSA. 1 of 3 lanes have been installed; remaining
lanes pushed out to Q4 2019.
(3) 2018 Budget included a reclass of $8.7M to nonoperating public expense for the non-Port owned
equipment to be turned over to the TSA. When
Baseline was set in early 2018, Construction was
lagging. Construction level of effort is now
matching and exceeding initial expectations as
schedule end dates have not slipped.
(4) Early works construction cancelled and combined
with main construction phase due to better
coordination with adjacent projects.
(5) Foundations and structural steel delayed and then
proceeded at a slower pace than expected.
Additionally, a major payment (~$9M) scheduled
for Dec-18 was delayed one month by GMP
negotiation and settlement and will apply in Jan19.
(6) Project has been delayed until 2020.
(7) Favorable bids on the project.

Actual spending was 72.8% of budget
61

SAMP Overview
$ in 000's
SAMP Completion & Transition to Env Review
Adv Planning IDIQ - Master Plan
Environmental Review - Master Plan
SAMP Utilities Master Plan
Total SAMP-Related Spending

2016
Actual
1,591
0
208
0
1,799

2017
Actual
1,335
1,141
169
276
2,921

2018
Actual
462
3,905
521
459
5,347

2018
Budget
500
2,500
1,700
500
5,200

Fav (Unfav)
2018 Budget Variance
$
%
38
7.6%
(1,405)
-56.2%
1,179
69.4%
41
8.3%
(147)
-2.8%

Inc (Decr)
Change from 2017
$
%
(873) -54.9%
2,764
N/A
352 169.2%
183
N/A
2,426 134.8%

Accelerated pace in advance planning offsets timing delay in Environmental Review
62

Maritime Division
Appendix

Maritime 2018 Financial Summary
$ in 000's
Fishing & Operations
Recreational Boating
Cruise
Bulk
Maritime Portfolio Management
Other
Total Revenue
Expenses
Fishing & Operations
Rec Boating
Cruise
Other Maritime
Maintenance Expenses
Portfolio Management
Other ED Expenses
Total Maritime & EDD expenses
Enviromental & Sustainability
CDD Expenses
Police Expenses
Other Central Services
Aviation Division
Total Central Services & Aviation
Envir Remed Liability
Total Expense
NOI Before Depreciation
Depreciation
NOI After Depreciation

2016
Actual
9,108
10,255
15,422
5,382
10,255
388
50,810

2017
Actual
9,297
11,086
17,596
5,427
10,787
(9)
54,183

2018
Actual
9,763
12,529
18,880
5,167
11,305
(69)
57,575

2018
Budget
8,388
12,166
18,150
5,163
11,169
17
55,053

Fav (UnFav)
Budget Variance
$
%
1,375
16%
362
3%
730
4%
4
0%
136
1%
(86)
-502%
2,522
5%

4,308
3,164
2,600
781
9,900
3,367
420
24,540
1,358
1,010
3,921
9,300
139
15,728
115
40,384
10,426
17,351
(6,924)

4,599
3,813
2,674
462
10,420
3,507
665
26,140
1,125
748
3,756
9,869
138
15,635
389
42,164
12,020
17,410
(5,390)

4,702
3,688
2,677
259
11,416
3,726
621
27,089
1,588
823
4,041
9,564
148
16,163
0
43,252
14,323
18,022
(3,699)

4,641
4,595
4,748
1,399
11,261
3,750
833
31,226
2,168
1,212
4,209
10,641
123
18,352
0
49,578
5,475
17,868
(12,394)

(61)
907
2,071
1,140
(156)
23
212
4,137
580
389
168
1,077
(24)
2,189
0
6,326
8,848
(154)
8,695

-1%
20%
44%
81%
-1%
1%
25%
13%
27%
32%
4%
10%
-20%
12%
NA
13%
162%
-1%
70%

Incr (Decr)
Change from 2017
$
%
465
5%
1,443
13%
1,284
7%
(260)
-5%
518
5%
(60)
-692%
3,391
6%
104
(126)
3
(203)
996
219
(44)
949
463
75
285
(305)
10
528
(389)
1,088
2,303
612
1,691

2%
-3%
0%
-44%
10%
6%
-7%
4%
41%
10%
8%
-3%
7%
3%
-100%
3%
19%
4%
31%

Successful revenue growth and expense management so far
64

Maritime Capital 2018
$ in 000's
Salmon Bay Marina ACQ
SBM Restrms/Service Bldgs Rep
FT Gateway Building
P91 South End Fender
Maritime Fleet Replacement
Contingency Renewal & Replace.
SBM Paving
Cruise Terminal Tenant Improv
Salmon Bay Marina Uplands
FT Docs 3,4,5 Fixed Pie
Restoration
All Other Projects
Total Maritime

2018
Actual
15,724
221
868
2,056
1,422
0
136
343
46
174
109
3,992
25,091

2018
Budget
15,804
7,162
2,700
2,202
2,158
2,000
1,673
1,531
1,505
1,424
1,140
7,150
46,449

Budget Variance
$
%
80
1%
6,941
97%
1,832
68%
146
7%
736
34%
2,000
100%
1,537
92%
1,188
78%
1,459
97%
1,250
88%
1,031
90%
3,158
44%
21,358
46%

• Shilshole Bay Marina restroom and
paving projects moved to 2019
following scope change.
• Cruise Tenant Improvements pushed
to 2019 due to lease conditions.
• Contingency was used for $850 Port
wide Radio System upgrade and
$250K for Shilshole Bay Marina
Charging station.

SBM restrooms and paving delayed due to bidding and permit schedule
65

Stormwater Utility
Fav (UnFav)

Incr (Decr)

Budget Variance

Change from 2017

2017

2018

2018

Actual

Actual

Budget

$

3,698
399
1,187

3,692
453
1,189

6

0%

306

9%

(53)

-12%

(4)

-1%

Non-tenants Revenue

3,392
404
1,189

(2)

0%

(2)

0%

Total Revenues

4,985

5,285

5,333

(49)

-1%

300

6%

SWU Direct

905

841

1,159

317

27%

(64)

-7%

Maintenance Expenses

2,380

3,317

3,413

97

3%

937

39%

EDD Expenses

20

7

18

10

58%

(12)

-62%

Environmental & Sustainability

375

326

237

(89)

-38%

(49)

-13%

Capital Development Expenses

41

28

51

24

46%

(13)

-32%

$ in 000's

%

$

%

StormWater Utility
NWSA
Tenants Revenue

Other Central Service Expenses
Total Expenses

389

690

723

33

5%

301

78%

4,109

5,210

5,601

392

7%

1,100

27%

NOI Before Depreciation

875

75

(268)

343

128%

(800)

-91%

Depreciation

1,008

1,117

1,221

104

8%

109

11%

NOI After Depreciation

(133)

(1,042)

(1,489)

447

30%

(909)

-683%

SWU tracking to budget
66

Economic Development Division
Appendix

EDD 2018 Financial Detail
$ in 000's
Revenue
Conf & Event Centers
Total Revenue
Expenses
Portfolio Management
Conf & Event Centers
P69 Facilities Expenses
RE Dev & Planning
EconDev Expenses Other
Maintenance Expenses
Maritime Expenses (Excl Maint)
Total EDD & Maritime Expenses
Small Business
Workforce Development
Tourism
EDD Grants
Total EDD Initiatives
Environmental & Sustainability
CDD Expenses
Police Expenses
Other Central Services
Aviation Division
Total Central Services & Aviation
Envir Remed Liability
Total Expense
NOI Before Depreciation
Depreciation
NOI After Depreciation

2016
Actual
7,880
8,022
15,902

2017
Actual
8,658
9,133
17,791

2018
Actual
9,002
11,703
20,705

2018
Budget
8,985
9,537
18,522

Fav (UnFav)
Budget Variance
$
%
17
0%
2,166
23%
2,182
12%

Incr (Decr)
Change from 2017
$
%
344
4%
2,570
28%
2,914
16%

3,425
6,932
180
595
620
2,783
31
14,566
21
522
1,093
20
1,656
62
212
157
4,222
107
4,761
0
20,983
(5,080)
3,682

3,875
7,639
206
214
776
3,666
52
16,427
64
850
1,234
751
2,900
260
387
51
5,257
113
6,068
0
25,396
(7,605)
3,863

3,571
9,889
235
149
785
3,915
166
18,711
132
702
1,408
838
3,080
281
283
(76)
5,259
113
5,860
0
27,651
(6,946)
3,992

3,778
8,465
289
211
1,227
3,055
344
17,370
140
1,992
1,460
960
4,552
398
329
158
5,816
127
6,829
0
28,751
(10,229)
4,156

207
(1,424)
54
62
442
(860)
178
(1,341)
8
1,290
51
122
1,472
117
46
234
557
14
969
0
1,101
3,283
164

5%
-17%
19%
29%
36%
-28%
52%
-8%
6%
65%
4%
13%
32%
29%
14%
148%
10%
11%
14%
NA
4%
32%
4%

(304)
2,251
30
(65)
9
249
114
2,283
68
(148)
174
87
180
21
(104)
(127)
1
1
(209)
0
2,255
659
129

-8%
29%
14%
-30%
1%
7%
217%
14%
105%
-17%
14%
12%
6%
8%
-27%
-248%
0%
1%
-3%
NA
9%
9%
3%

(8,763)

(11,469)

(10,938)

(14,385)

3,447

24%

531

5%

Better than expected conference and event center volumes
68

EDD Capital 2018
$ in 000's
P66 Elevator 2,3,4 Upgrades
RE: Contingency Renew.&Replace
BHICC Interior Modernization
Small Projects
Tenant Improvements -Capital
P69 Solar Panel System
T-102 Outdoor Lighting
T91 Upland PreDevelopment
CW Elevator Modernization
All Other projects
Total Economic Development

2018
Actual

2018
Budget

Budget Variance
$

%

1,043
0
283
195
23
202
30
15
0
275

1,175
1,000
710
516
532
502
437
425
325
477

132
1,000
427
321
509
300
407
410
325
202
0

11%
100%
60%
62%
96%
60%
93%
96%
100%
42%
NA

2,066

6,099

4,033

66%

Project costs moved to 2019 and
Contingency applied to Port wide
radio system.

Prioritization and project delays
69

Central Services
Appendix

Central Services Financial Summary
Total Operating Revenues

2016
Actual
1,330

2017
Actual
68

2018
Actual
(500)

2018
Budget
182

Fav (UnFav)
Incr (Decr)
Budget Variance Change from 2017
$
%
$
%
(682) -375.4%
(569) -832.8%

Core Central Support Services
Police
Capital Development
Environment & Sustainability
Total Operating Expenses

69,196
23,045
12,218
8,824
113,284

71,071
22,095
17,370
6,975
117,511

73,576
23,908
15,501
8,770
121,755

80,367
27,065
26,289
11,504
145,225

6,791
3,157
10,788
2,735
23,470

$ in 000's

8.4% 2,505
11.7% 1,813
41.0% (1,869)
23.8% 1,795
16.2% 4,244

3.5%
8.2%
-10.8%
25.7%
3.6%

Operating expenses were $23.5M favorable to budget in 2018
71

Central Services Expense by Category
$ in 000's
Salaries & Benefits
Wages & Benefits
Payroll to Capital Projects
Equipment Expense
Supplies & Stock
Outside Services
Travel & Other Employee Exps
Insurance Expense
Litigated Injuries & Damages
Other
Charge to Capital
Total

2016
Actual
64,835
21,943
19,060
1,920
1,280
30,262
2,510
2,349
279
2,554
(33,708)
113,284

Fav (UnFav)
Incr (Decr)
2017
2018
2018
Budget Variance Change from 2017
Actual
Actual
Budget
$
%
$
%
69,448
78,529
82,549
4,020
4.9%
9,081
13.1%
20,517
15,858
26,793
10,935
40.8% (4,659) -22.7%
21,859
22,781
23,159
378
1.6%
923
4.2%
3,109
4,107
3,077
(1,030) -33.5%
998
32.1%
1,446
1,399
1,454
55
3.8%
(48)
-3.3%
34,053
39,009
46,975
7,966
17.0%
4,956
14.6%
2,568
2,574
3,722
1,148
30.8%
6
0.2%
2,223
2,145
2,320
175
7.5%
(78)
-3.5%
435
(82)
82
0.0%
(517) -118.9%
2,152
2,798
3,494
695
19.9%
647
30.1%
(40,299) (47,363) (48,317)
(955)
2.0%
7,063
17.5%
117,511 121,755 145,225
23,470
16.2%
4,244
3.6%

•
•

•

Payroll savings due to
staff vacancies.
Outside Services
favorable budget
variance mainly came
from lower spending
and project delays.
Charge to Capital was
lower than budget due
to delay of some
capital projects.

Most of the budget savings came from payroll and outside services
72

Central Services Capital Spending
$ in 000's
Infrastructure - Small Cap
Services Tech - Small Cap
Project Cost Mgmt System
Supplier Database System
Corporate Firewall
PeopleSoft Financials Upgrade
Radio System Upgrade
Police Records Mgmt System
CDD Fleet Replacement
Corporate Fleet Replacement
Other (note 1)
TOTAL

2018
Actual
786
225
430
349
66
2,025
3,866
0
768
726
466
9,707

2018
Budget
1,500
1,150
600
450
922
3,100
12,000
700
1,210
1,180
1,526
24,338

Budget Variance
$
%
714
47.6%
925
80.4%
170
28.3%
101
22.4%
856
92.8%
1,075
34.7%
8,134
67.8%
700
100.0%
442
36.5%
454
38.5%
1,060
69.5%
14,631
60.1%

Note:
(1) "Other" includes remaining ICT projects and small capital projects/acquisitions.

2018 capital spending was $9.7M for Central Services
73