Port of Seattle Regular Commission Regular Meeting April 22, 2025 Page 1 of 373 COMMISSION REGULAR MEETING AGENDA April 22, 2025 To be held virtually via MS Teams and in person at the Seattle-Tacoma International Airport - Conference Center, International Room, located at 17801 International Blvd, Seattle WA, Mezzanine Level. You may view the full meeting live at meetings.portseattle.org. To listen live, call in at +1 (206) 800-4046 or (833) 209-2690 and Conference ID 539 689 093# ORDER OF BUSINESS 10:30 a.m. 1. CALL TO ORDER 2. EXECUTIVE SESSION - if necessary, pursuant to RCW 42.30.110 (executive sessions are not open to the public) ► 12:00 a.m. - PUBLIC SESSION Reconvene or Call to Order and Pledge of Allegiance 3. APPROVAL OF THE AGENDA (at this time, commissioners may reorder, add, or remove items from the agenda) 4. SPECIAL ORDERS OF THE DAY 5. EXECUTIVE DIRECTOR'S REPORT 6. COMMITTEE REPORTS 7. PUBLIC COMMENT - procedures available online at https://www.portseattle.org/page/public-comment-portcommission-meetings During the regular order of business, those wishing to provide public comment (in accordance with the Commission's bylaws) on Commission agenda items or on topics related to the conduct of Port business will have the opportunity to: 1) Deliver public comment via email: All written comments received by email to commission-publicrecords@portseattle.org will be distributed to commissioners and attached to the approved minutes. Written comments are accepted three days prior to the meeting and before 9.a.m. on the day of the meeting. Late written comments received after the meeting, but no later than the day following the meeting, will be included as part of the meeting record. 2) Deliver public comment via phone or Microsoft Teams conference: To take advantage of this option, please email commission-public-records@portseattle.org with your name and agenda item or topic related to the conduct of Port business you wish to speak to by 9:00 a.m. PT on Tuesday, April 22, 2025. (Please be advised that public comment is limited to agenda items and topics related to the conduct of Port business only.) You will then be provided with instructions and a link to join the Teams meeting. 3) Deliver public comment in person by signing up to speak on your arrival to the physical meeting location: To take advantage of this option, please arrive at least 15 minutes prior to the start of any regular meeting to sign-up on the public comment sheet available at the entrance to the meeting room to speak on agenda items and topics related to the conduct of Port business. Founded in 1911 by a vote of the people as a special purpose government, the Port of Seattle's mission is to promote economic opportunities and quality of life in the region by advancing trade, travel, commerce, and job creation in an equitable, accountable, and environmentally responsible manner. Page 2 of 373 PRELIMINARY AGENDA - Port of Seattle Commission Regular Meeting of April 22, 2025 Page 2 of 4 For additional information, please contact commission-public-records@portseattle.org. 8. CONSENT AGENDA (consent agenda items are adopted by one motion without discussion) 8a. Approval of the Regular Meeting Minutes of April 8, 2025. (no enclosure) 8b. Approval of the Claims and Obligations for the Period of September 1, 2024, through September 30, 2024, Including Accounts Payable Manual Check Nos. 100029 through 101558 in the Amount of $11,751,601.57; Accounts Payable Electronic Fund Transfer Nos. 102184 through XL383127 in the Amount of $79,873,385.29; Payroll Check Nos. 216686 through 221664 in the Amount of $16,316,872.52; and Payroll ACH Nos. 1216138 through 1216139 in the Amount of $2,210.93, for Total Payments of $107,944,070.31. Approval of the Claims and Obligations for the Period of October 1, 2024, through October 31, 2024, Including Accounts Payable Check Nos. 955310 through 955310 in the Amount of $533.78; Accounts Payable Manual Checks Nos. 101559 through 102179 in the Amount of $18,255,405.12; Accounts Payable ACH Nos. 069209 through 069209 in the Amount of $6,245.05; Accounts Payable Electronic Fund Transfer Nos. 102373 through SXL383-9 in the Amount of $96,845,804.71; Payroll Check Nos. 221665 through 226614 in the Amount of $16,162,313.30; and Payroll ACH Nos. 1216140 through 1216142 in the Amount of $24,146.96, for Total Payments of $131,294,448.92. Approval of the Claims and Obligations for the Period of November 1, 2024, through November 30, 2024, Including Accounts Payable Check Nos. 955311 through 955645 in the Amount of $11,575,279.52; Accounts Payable Manual Checks Nos. 102180 through 102221 in the Amount of $623,712.88; Accounts Payable ACH Nos. 069210 through 069870 in the Amount of $67,724,687.92; Accounts Payable Electronic Fund Transfer Nos. 069374 through SXL383-410 in the Amount of $35,153,863.39; Payroll Check Nos. 226615 through 227140 in the Amount of $324,543.57; and Payroll ACH Nos. 1216143 through1222704 in the Amount of $17,586,776.48, for Total Payments of $132,988,863.76. Approval of the Claims and Obligations for the Period of December 1, 2024, through December 31, 2024, Including Accounts Payable Check Nos. 955646 through 955971 in the Amount of $7,489,947.23; Accounts Payable Manual Checks Nos. 101041 through 101961 in the Amount of $16,903.50; Accounts Payable ACH Nos. 069871 through 071978 in the Amount of $106,858,516.87; Accounts Payable Electronic Fund Transfer Nos. 102964 through SHR-78 in the Amount of $19,556,762.88; Payroll Check Nos. 227141 through 227555 in the Amount of $160,133.84; and Payroll ACH Nos. 1222705 through 1227494 in the Amount of $17,535,435.54, for a Fund Total of $151,617,699.86. (memo 1, memo 2, memo 3, and memo 4 enclosed) 8c. Authorization for the Executive Director to Execute Termination Agreements; to Payout where Applicable Net Book Value Associated with the Termination Agreements; and to Execute Lease and Concession Agreements and Amendments for Certain Airport Dining and Retail Tenants Impacted by Various Capital Projects and Unforeseen Construction-Related Delays in the Requested Amount of $739,725. (memo and presentation enclosed) Commissioners: Ryan Calkins ■ Sam Cho ■ Fred Felleman ■ Toshiko Hasegawa ■ Hamdi Mohamed Executive Director: Stephen P. Metruck To contact commissioners: 206-787-3034 For meeting records and information: commission-public-records@portseattle.org 206-787-3210 www.portseattle.org Page 3 of 373 PRELIMINARY AGENDA - Port of Seattle Commission Regular Meeting of April 22, 2025 Page 3 of 4 8d. Number Not Used. 8e. Authorization for the Executive Director to Increase the Capital Improvement Project Authorization for the Water Reservoir Rehabilitation in the Amount of $1,600,000, for a Revised Total Estimated Project Cost Notto-Exceed $5,169,000. (CIP #C801172) (memo enclosed) 8f. Authorization for the Executive Director to Expend up to $1,937,248 in Grant Funds and to Execute Related Service Agreements Not-to-Exceed $1,471,600, to Achieve the Results of the EPA Clean Ports Program Climate and Air Quality Planning Grant, for a Total Estimated Project Cost of $2,997,248. (memo, grant award, scope of work, and presentation enclosed) 8g. Commission Adoption of Order No. 2025-06: An Order Appointing Members to the Port of Seattle Commission Board of Ethics. (order enclosed) 10. NEW BUSINESS 10a 1. Industrial Development Corporation Annual Meeting - Approval of Minutes, Designation of Officers, and Annual Report for 2024. (IDC packet and minutes enclosed) 10b.Authorization for the Executive Director to Conduct the Release for a Request for Proposal (RFP 25-1) and to Execute a Lease and Concession Agreement with Selected Proposers at Seattle-Tacoma International Airport for the Twenty Airport Dining and Retail Locations that Will Naturally Expire Between 2025 and 2028. (memo and presentation enclosed) 10c. Authorization for the Executive Director to Execute a Sole Source Purchase Contract with Watts Marine, LLC for Procurement of Long-Lead Shore Power Electrical Equipment for Terminal 91/Pier 66 Cruise Shore Power Extension, in the Requested Amount of $8,000,000, for a Total Authorized Amount of $9,350,000 and Estimated Project Cost of $28,300,000. (CIP C#801983) (memo and presentation enclosed) 10d. Authorization for the Executive Director to Take All Steps Necessary, Including the Execution of All Contracts, Including Public Works, Alternative Public Work Procedures in Accordance with RCW 29.10, Goods and Services Personal Services, Professional Services, Other Consulting Services, and Any Other Types of Contracts or Agreements to Complete the Baggage Optimization Program Phase 3, in the Requested Amount of $477,373,982 and a Total Estimated Project Cost of $1,074,638,982. (CIP C#800612) (memo and presentation enclosed) 11. PRESENTATIONS AND STAFF REPORTS 11a. Fly Quiet Awards. (memo and presentation enclosed) This is a special meeting of the Industrial Development Corporation. The Regular Commission Meeting will recess, and the Commission will enter into the separate IDC meeting as Directors of the IDC. The regular meeting of the Commission will reconvene once the IDC meeting has adjourned. 1 Commissioners: Ryan Calkins ■ Sam Cho ■ Fred Felleman ■ Toshiko Hasegawa ■ Hamdi Mohamed Executive Director: Stephen P. Metruck To contact commissioners: 206-787-3034 For meeting records and information: commission-public-records@portseattle.org 206-787-3210 www.portseattle.org Page 4 of 373 PRELIMINARY AGENDA - Port of Seattle Commission Regular Meeting of April 22, 2025 Page 4 of 4 11b. Seattle Waterfront Clean Energy Strategy Briefing. (memo, strategy, agreement, and presentation enclosed) 11c. 2024 Financial Performance Briefing. (memo, report, and presentation enclosed) 2. QUESTIONS on REFERRAL to COMMITTEE and CLOSING COMMENTS 13. ADJOURNMENT Commissioners: Ryan Calkins ■ Sam Cho ■ Fred Felleman ■ Toshiko Hasegawa ■ Hamdi Mohamed Executive Director: Stephen P. Metruck To contact commissioners: 206-787-3034 For meeting records and information: commission-public-records@portseattle.org 206-787-3210 www.portseattle.org Page 5 of 373 P.O. Box 1209 Seattle, Washington 98111 www.portseattle.org 206.787.3000 APPROVED MINUTES COMMISSION REGULAR MEETING April 8, 2025 The Port of Seattle Commission met in a regular meeting Tuesday, April 8, 2025. The meeting was held at the Port of Seattle Headquarters Building Commission Chambers, located at 2711 Alaska Way, Seattle Washington, and virtually on Microsoft Teams. 1. CALL to ORDER The meeting was convened at 10:30 a.m. by Commission President Toshiko Hasegawa. 2. EXECUTIVE SESSION pursuant to RCW 42.30.110 The public meeting recessed into executive session to discuss two items - one regarding Litigation/Potential Litigation/Legal Risk per RCW 42.30.110(1)(i) and National Security per RCW 42.30.110(1)(a)(i) and the other regarding Litigation/Potential Litigation/Legal Risk per RCW 42.30.110(1)(i) for approximately 60 minutes, with the intention of reconvening the public session at 12:00 p.m. Following the executive session, the public meeting reconvened at 12:16 p.m. Commission President Toshiko Hasegawa led the flag salute. 3. APPROVAL of the AGENDA The agenda was approved, as presented, and without objection. 4. SPECIAL ORDERS OF THE DAY No Special Orders of the Day were presented. 5. EXECUTIVE DIRECTOR'S REPORT Deputy Executive Director Goon previewed items on the day's agenda and made general and meeting-related announcements. Digital recordings of the meeting proceedings and meeting materials are available online - www.portseattle.org. Page 6 of 373 PORT COMMISSION MEETING MINUTES TUESDAY, APRIL 8, 2025 6. Page 2 of 8 COMMITTEE REPORTS Erica Chung, Commission Office Strategic Advisor, presented committee reports as follows: Audit Committee The Audit Committee met on March 18, 2025, with Commissioner Calkins presiding and Commissioner Mohamed and Public Member Sarah Holmstrom in attendance. The Committee received the Accountability Audit Results for 2023 from the Office of the Washington State Auditor. Port operations was audited and complied with applicable state laws, regulations, and its own policies, and provided adequate controls over the safeguarding of public resources. The Committee also received updates from the Internal Audit Director on the Director's annual communications to the committee; the Internal Audit Outreach Program; and on the 2025 Internal Audit Plan. An Information Technology Audit regarding the Satellite Transit System was provided in non-public session. Aviation Committee Commissioners Felleman and Cho convened the Aviation Committee on March 18, 2025. Commissioners heard a report on the current status and projected finances of major projects at SEA. Commissioners identified the need to discuss how these projects are prioritized for funding as an entire Commission (not just in the Aviation Committee.) Commissioners also asked about efforts to improve the accuracy of the airport's Automated Parking Space indicators, and staff indicated that they would reply to the Commissioners with a summary of the work being done to improve the accuracy of these indicators. Commissioner Felleman asked about SEA's projected financial metrics, including future Cost Per Enplanement and Passenger Facility Charge revenues. Staff followed up with this data. Portwide Arts and Culture Board Commissioners Calkins and Felleman attended the Portwide Art and Cultural Board meeting on March 21, 2025. Tommy Gregory, Art Program Manager, gave the committee an overview of this year's major aviation and maritime public art projects and upcoming acquisitions. The committee discussed and approved moving forward with a public art collection monograph; with more details to be shared at the next committee. Discussion also ensued regarding seeking candidates to fill a vacancy of a public member on the board. Sustainability, Environment, and Climate Committee Commissioners Calkins and Cho convened the Sustainability, Environment, and Climate Committee on March 21, 2025, with two topics on the agenda. Commissioners received a pre-season update on the 2025 cruise season and its progress towards sustainability objectives including Carnival availability and shore power capability of ships at Pier 66 and Terminal 91 to reduce carbon emissions. Robust discussion ensued on how the biodiesel pilot can offer insights to the regulatory and operational issues, alternative fuels research happening, and fuels for long-term adoption. Commissioners were then briefed on the design findings for the South Concourse Evolution, Phase I, capital improvement project under the sustainable evaluation framework Including staff recommendations on carbon reduction strategies and HVAC options, including future Cost Per Enplanement and Passenger Facility Charge revenues. Minutes of October 27, 2020, submitted for review on November 5, 2020, and proposed for approval on November 10, 2020. Page 7 of 373 PORT COMMISSION MEETING MINUTES TUESDAY, APRIL 8, 2025 Page 3 of 8 Highline Forum The Highline Forum met on March 26, 2025 with Commissioner Cho presiding. Major topics of the meeting were an update on the SEA Stakeholder Advisory Round Table's (StART) first State Legislative Priorities advocacy efforts in Olympia and sharing the results of the assessment for the Port's Sound Insulation Repair and Replacement Pilot Program. The Port's State Government Relations Manager John Flanagan shared the five priorities that StART collectively agreed to pursue at the State Legislature for the benefit of the neighboring communities. The Port's Noise Program Manager Ryan McMullan reviewed the results from the assessment for the Port's Sound Insulation Repair and Replacement Pilot Program and next steps. He shared that they received over 1000 responses of the approximately 3200 households contacted; conducted field assessment and acoustic testing of 30 homes; and reviewed studies of the expected useful life of windows and doors, key findings. Federal Way Mayor Jim Ferrell, as the meeting host city, provided an update on the many activities happening in Federal Way. Aviation Capital Delivery Director Clare Gallagher reported on the February 26, 2025, StART meeting and shared that the goal of the upcoming April 23 meeting would be to identify which priorities should be added to the running list for consideration at future StART meetings. During the round table sharing, Commissioner Cho announced the departure of Aviation Managing Director Lance Lyttle for the Greater Orlando Airport Authority. Waterfront and Industrial Lands Committee Commissioners Felleman and Calkins convened the Waterfront and Industrial Lands Committee meeting on April 7, 2025. There were three briefing items provided: an update on progress with Forum Mobility; an update on Jack Block Park improvements; and proposed waterfront floodplain updates by the City of Seattle. 7. • • • • • • • • PUBLIC COMMENT The following people spoke in support of Agenda Item 10c, 2025-2026 Economic Development Partnership Program grant authorizations: Jen David Hayes, City of Issaquah; Nicole Suarez, City of Kenmore; Chris Craig, City of Burien; Lara Thomas, City of Duvall; and Nathan Daum, City of Shoreline. The following people spoke in opposition to cruise operations and regarding climate impacts: Jordan VanVoast, Iris Antman, Stacy Oaks, Aimee Phair, and Ric Harlan, of Seattle Cruise Control. The following people spoke regarding the need for a commercial pump out at the Port of Seattle: Peter Schrappen, AWO, and Russell Shrewsbury, Western Towboat Co. The following person spoke in opposition to the Port of Seattle's rule of procedure with respect to what can be discussed during the public comment portion of business meetings: Alex Tsimerman. The following person spoke in favor of protected Port industrial lands: Mark Elverston, President ILWU. The following person spoke in favor of Port cruise operations and in opposition to City of Seattle development of housing in the Port's heavy-haul corridor: Ron Manwell, ILWU. The following people spoke in support of cruise operations and economic benefits to the region: Lars Erickson, Seattle Metro Chamber and Liz Johnson, Visit Seattle. The following person spoke regarding revising travel and cargo projects at the Port: Sandy Hunt, Defenders of Highline Forests (written comment also submitted). Minutes of October 27, 2020, submitted for review on November 5, 2020, and proposed for approval on November 10, 2020. Page 8 of 373 PORT COMMISSION MEETING MINUTES TUESDAY, APRIL 8, 2025 • • • • Page 4 of 8 In lieu of spoken comment, written comment supporting reduction in cruise and climate impacts was submitted by: Linda Carroll; Arun Ganti; Jared Howe; Hoa Pantastico; Camille BaldwinBonney; Shary B; Jim Lieberman; Liana Lang; Scring67@comcast.net; Matt Kolenski; Rosemary Moore; Peggy Printz; Theo McGillivray; Elana Sulakshana; Betty Brooking; Jess Wallach; Gabby Connors; Erica Schweizer; and Delia Ward. In lieu of spoken comment, written comment supporting the economic benefits that cruise brings to the region and re-engaging in conversations to build a third cruise terminal at T46 was submitted by: Bob Donegan, Seattle Historic Waterfront Association. In lieu of spoken comment, written comment supporting Agenda Item 10c, the Port's Economic Development Partnership Grant Program and related 2025-2026 authorization requests was submitted by: Doug McIntyre, City of Maple Valley; Chris Pasinetti, City of Enumclaw; and Julianna LaBrake, City of Federal Way. In lieu of spoken comment, written comment asking the Port to balance its cruise operations with climate sustainability was submitted by: Rick Harlan. [Clerk's Note: All written comments are combined and attached here as Exhibit A.] 8. CONSENT AGENDA [Clerk's Note: Items on the Consent Agenda are not individually discussed. Commissioners may remove items for separate discussion and vote when approving the agenda.] 8a. Approval of the Regular Meeting Minutes of March 11, 2025 and the Special Meeting Minutes of March 25 and March 28, 2025. 8b. Monthly Notification of Prior Executive Director Delegation Actions March 2025. Request document(s) included an agenda memorandum for information only. 8c. Approval of Commission International Travel Requests for the Second Quarter 2025. Request document(s) included an agenda memorandum. 8d. Authorization for the Executive Director to Increase Funding for a Previous Executive Authorization Approved Contract to Perform Regulatory Dry Fire Suppression Standpipe System Upgrades in the Satellite Transit System Tunnels in the Amount of $2,029,000, and an Estimated Project Cost of $4,000,000. (CIP #C801429). Request document(s) included an agenda memorandum and presentation. 8e. Commission Adoption of Order 2025-05: An Order Providing for Performance Rating for Executive Director. Request document(s) included an Order. Minutes of October 27, 2020, submitted for review on November 5, 2020, and proposed for approval on November 10, 2020. Page 9 of 373 PORT COMMISSION MEETING MINUTES TUESDAY, APRIL 8, 2025 Page 5 of 8 Members of the Commission spoke in support of Agenda Item 8e, and the leadership provided by the Executive Director. The motion for approval of consent agenda items 8a, 8b, 8c, 8d, and 8e carried by the following vote: In favor: Calkins, Cho, Felleman, Hasegawa, and Mohamed (5) Opposed: (0) 9. UNFINISHED BUSINESS There was no unfinished business presented. 10. NEW BUSINESS 10a. Authorization for the Executive Director to Take All Steps Necessary to Complete the Tenant Airport Dining and Retail Shell and Core Renovations Project at the SeattleTacoma International Airport, in the Requested Amount of $10,073,000, and an Estimated Project Cost of $10,373,000. Requested document(s) included an agenda memorandum and presentation. Presenter(s): Khalia Moore, Assistant Director, Airport Dining and Retail Randal Anton, Capital Project Manager III, AV Project Management Group Clerk Hart read Item 10a into the record and Deputy Executive Director Goon introduced the item. The presentation addressed: • the request to complete the Tenant ADR Shell and Core Renovations project at SEA; • background details of the project; • the goal of the project - aimed to lower tenant costs and remove barriers to entry by providing future tenants with a cold shell for buildout; • project scope and locations; • lease expirations; • cost breakdown; and • project schedule. Discussion ensued regarding: • creating tenant predictability in the program; • phased project approach with a phased request for proposals process; • the process if someone is ultimately not successful in their bid for space; and • use of spaces remaining the same since the master plan is already complete. The motion, made by Commissioner Cho, carried by the following vote: In favor: Calkins, Cho, Felleman, Hasegawa, and Mohamed (5) Opposed: (0) Minutes of October 27, 2020, submitted for review on November 5, 2020, and proposed for approval on November 10, 2020. Page 10 of 373 PORT COMMISSION MEETING MINUTES TUESDAY, APRIL 8, 2025 Page 6 of 8 10b. Authorization for the Executive Director to Take All Steps Necessary to Complete the Concourse A Shared-Use Lounge Project (Club SEA) at the Seattle-Tacoma International Airport and to Fully Authorize the Project and Execute the Construction Contract, in the Requested Amount of $24,360,000 and a Total Estimated Project Cost of $30,500,000. (CIP #C801207). Requested document(s) included an agenda memorandum and presentation. Presenter(s): Rick Duncan, Director AV Business and Properties, AV Business and Properties Erin Gora, Capital Program Leader, AV Project Management Group Clerk Hart read Item 10b into the record and Deputy Executive Director Goon introduced the item. The presentation addressed: • the request to complete the Concourse A Shared Use Lounge Project at SEA; • current airport lounge inventory at SEA; • project purpose and justification; • project location; • changes to the project; • cost breakdown and certainty; and • project schedule. Discussion ensued regarding: • operator of the lounge; • anticipated revenue over life of the asset and passenger modeling used; • input from airlines into the project; and • revised forecasting based on actions of the federal administration impacting travel. The motion, made by Commissioner Calkins, carried by the following vote: In favor: Calkins, Cho, Felleman, Hasegawa, and Mohamed (5) Opposed: (0) 10c. Authorization for the Executive Director to Execute Contract Agreements and Implement the 2025-2026 Economic Development Partnership Program with King County Cities in an Amount Not to Exceed of $1,900,000 and Authorizing the Executive Director to Execute Contracts Using Unutilized Program Funding to Advance Regional Initiatives to Further Equitable and Innovative Economic Development Initiatives. Requested document(s) included an agenda memorandum and presentation. Minutes of October 27, 2020, submitted for review on November 5, 2020, and proposed for approval on November 10, 2020. Page 11 of 373 PORT COMMISSION MEETING MINUTES TUESDAY, APRIL 8, 2025 Page 7 of 8 Presenter(s): Annie Tran, Economic Development Program Manager, Economic Development Administration A Boungjaktha, Managing Director Economic Development, Economic Development Administration Rhonda Ender, City Manager, City of Carnation Michelle Wilmot, Economic Development Manager, City of Kent Amanda Free, Economic Development Acting Director, City of Renton Clerk Hart read Item 10c into the record and Deputy Executive Director Goon introduced the item. The presentation addressed: • the 2025-2026 authorization request; • background of the grants program; • Port funding programs; • 2024 funding cycle data; • small business assistance impacts; • buy local/placemaking impacts; • tourism impacts; • local impacts to neighboring cities including Carnation, Kent, and Renton; • return on investment; and • 2025-2026 focus areas. Discussion ensued regarding: • established meaningful partnerships; • pushing tourism and economic development out to the broader county through these grants; and • demonstrating WMBE utilization and having that demonstrated through these grant projects. The motion, made by Commissioner Cho, carried by the following vote: In favor: Calkins, Cho, Felleman, Hasegawa, and Mohamed (5) Opposed: (0) 11. PRESENTATIONS AND STAFF REPORTS There were no presentations or staff reports provided. 12. QUESTIONS on REFERRAL to COMMITTEE and CLOSING COMMENTS Commissioner Calkins stated that he would like a follow-up discussion on having a pump out station in Seattle. Commissioner Felleman spoke regarding having a robust community engagement around the recruitment of a new Airport Director and in support of Agenda Item 8e and Executive Director Metruck's continued performance; and reported regarding his participation at the Houston Port of the Future Conference. Minutes of October 27, 2020, submitted for review on November 5, 2020, and proposed for approval on November 10, 2020. Page 12 of 373 PORT COMMISSION MEETING MINUTES TUESDAY, APRIL 8, 2025 Page 8 of 8 Commissioner Cho spoke regarding his testimony in Washington DC at a public hearing before the US Trade Representative's Office on a policy seeking to implement a $1,000,000 fee on all vessels made by a Chinese manufacturer or operated by a Chinese carrier; noted the impacts of tariffs announced by the federal government; and spoke regarding the uncertainty injected into the economy. Commissioner Mohamed asked that the issue of labor unions' access to secured areas at SEA be added to a committee agenda for a briefing. There was no objection to referral of the item to a committee and the matter was referred to the Airport Workforce Conditions Committee. Commission President Hasegawa: • advised that she has made an inquiry with the Executives of the Northwest Seaport Alliance and with Executive Director Metruck to get an understanding of the legality of the tariffs and spoke regarding potential constitutional issues with the Congress delegating tariff-making authority to the President; • reported that the Port of Seattle has filed litigation against the City of Seattle for spot rezoning of the SoDo Industrial Area for housing; and • acknowledged another impact in the firing of employees in Washington State at the Federal Maritime and Conciliation Services by the Trump Administration, making labor partners go from disagreement to strike without an entity to mediate labor disputes, which could cause significant disruptions in the industry. 13. ADJOURNMENT The meeting adjourned at 2:48 p.m. Prepared: Attest: Michelle M. Hart, Commission Clerk Sam Cho, Commission Secretary Minutes approved: April 22, 2025 Minutes of October 27, 2020, submitted for review on November 5, 2020, and proposed for approval on November 10, 2020. Page 13 of 373 COMMISSION AGENDA MEMORANDUM Item No. ACTION ITEM Date of Meeting DATE: April 15, 2025 TO: Steve Metruck, Executive Director FROM: Eloise Olivar, AFR Assistant Director Disbursements SUBJECT: Claim and Obligations - September 2024 8b.1 April 22, 2025 ACTION REQUESTED Request Port Commission approval of the Port Auditor's payment of the salaries and claims of the Port pursuant to RCW 42.24.180 for payments issued during the period September 01 through 30, 2024 as follows: Payment Type Accounts Payable Manual Checks **Accounts Payable Electronic Fund Transfer (EFT) ***Payroll Checks Payroll ACH Total Payments Payment Reference Start Number 100029 102184 Payment Reference End Number 101558 XL383127 216686 1216138 221664 1216139 Amount $11,751,601.57 $79,873,385.29 $16,316,872.52 $2,210.93 $107,944,070.31 ** Due to recovery from system outage, new series of payment reference numbers were generated. ***Due to recovery from system outage, all payroll direct deposits and checks were recorded as check payment type to avoid duplicate payments when Payroll system was restored. Pursuant to RCW 42.24.180, "the Port's legislative body" (the Commission) is required to approve in a public meeting, all payments of claims within one month of issuance. OVERSIGHT All these payments have been previously authorized either through direct Commission action or delegation of authority to the Executive Director and through his or her staff. Detailed information on Port expenditures is provided to the Commission through comprehensive budget presentations as well as the publicly released Budget Document, which provides an even greater level of detail. The Port's operating and capital budget is approved by resolution in December for the coming fiscal year, and the Commission also approves the Salary and Benefit Resolution around the same time to authorize pay and benefit programs. Notwithstanding the Port's budget approval, individual capital projects and contracts exceeding certain dollar thresholds are also subsequently brought before the Commission for specific authorization prior to commencement of the project or contract - if they are below the thresholds the Executive Director is delegated authority to approve them. Expenditures are monitored against budgets monthly by management and reported comprehensively to the Commission quarterly. Page 14 of 373 COMMISSION AGENDA - Action Item No. 8b.1 Page 2 of 3 Meeting Date: April 22, 2025 Effective internal controls over all Port procurement, contracting and disbursements are also in place to ensure proper central oversight, delegation of authority, separation of duties, payment approval and documentation, and signed perjury statement certifications for all payments. Port disbursements are also regularly monitored against spending authorizations. All payment transactions and internal controls are subject to periodic Port internal audits and annual external audits conducted by both the State Auditor's Office and the Port's independent auditors. For the month of September 2024, over $91,624,986.86 in payments were made to nearly 654 vendors, comprised of 2,807 invoices and over 4,798 accounting expense transactions. About 94 percent of the accounts payable payments made in the month fall into the Construction, Contracted Services, Payroll Taxes, Employee Benefits, Janitorial Services, Utility Expenses, Sales Taxes, Software, Environmental Remediation, and Parking Taxes. Net payroll expense for the month of September was $16,319,083.45. Top 10 Payment Category Summary: Category Construction Contracted Services Payroll Taxes Employee Benefits Janitorial Services Utility Expenses Sales Taxes Software Environmental Remediation Parking Taxes Other Categories Total Net Payroll Total Payments Payment Amount 44,364,345.24 10,160,075.13 9,996,745.22 8,883,728.94 5,794,705.76 2,914,156.97 1,661,250.09 1,071,510.51 847,479.33 811,562.01 5,119,427.66 16,319,083.45 $107,944,070.31 Page 15 of 373 COMMISSION AGENDA - Action Item No. 8b.1 Page 3 of 3 Meeting Date: April 22, 2025 Appropriate and effective internal controls are in place to ensure that the above obligations were processed in accordance with Port of Seattle procurement/payment policies and delegation of authority. At a meeting of the Port Commission held on April 22, 2025, it is hereby moved that, pursuant to RCW 42.24.180, the Port Commission approves the Port Auditor's payment of the above salaries and claims of the Port: _________________________________ _________________________________ _________________________________ _________________________________ _________________________________ Port Commission Page 16 of 373 COMMISSION AGENDA MEMORANDUM Item No. ACTION ITEM Date of Meeting DATE: April 15, 2025 TO: Steve Metruck, Executive Director FROM: Eloise Olivar, AFR Assistant Director Disbursements SUBJECT: Claims and Obligations - October 2024 8b.2 April 22, 2025 ACTION REQUESTED Request Port Commission approval of the Port Auditor's payment of the salaries and claims of the Port pursuant to RCW 42.24.180 for payments issued during the period October 01 through 31, 2024 as follows: Payment Type Accounts Payable Checks Accounts Payable Manual Checks Accounts Payable ACH **Accounts Payable Electronic Fund Transfer (EFT) ***Payroll Checks Payroll ACH Total Payments Payment Reference Start Number 955310 101559 069209 102373 Payment Reference End Number 955310 102179 069209 SXL383-9 221665 1216140 226614 1216142 Amount $533.78 $18,255,405.12 $6,245.05 $96,845,804.71 $16,162,313.30 $24,146.96 $131,294,448.92 **This line item includes six wire transfers totaling $282,284.22. Due to recovery from system outage, new series of payment reference numbers were generated. ***Due to recovery from system outage, all payroll direct deposits and checks were recorded as check payment type to avoid duplicate payments when Payroll system was restored. Pursuant to RCW 42.24.180, "the Port's legislative body" (the Commission) is required to approve in a public meeting all payments of claims within one month of issuance . OVERSIGHT All these payments have been previously authorized either through direct Commission action or delegation of authority to the Executive Director and through his or her staff. Detailed information on Port expenditures is provided to the Commission through comprehensive budget presentations as well as the publicly released Budget Document, which provides an even greater level of detail. The Port's operating and capital budget is approved by resolution in December for the coming fiscal year, and the Commission also approves the Salary and Benefit Resolution around the same time to authorize pay and benefit programs. Notwithstanding the Port's budget approval, individual capital projects and contracts exceeding certain dollar thresholds are also Page 17 of 373 subsequently brought before the Commission for specific authorization prior to commencement of the project or contract-if they are below the thresholds the Executive Director is delegated authority to approve them. Expenditures are monitored against budgets monthly by management and reported comprehensively to the Commission quarterly. Page 18 of 373 Page 3 of 3 COMMISSION AGENDA - Action Item No. 8b.2 Meeting Date: April 22, 2025 Effective internal controls over all Port procurement, contracting and disbursements are also in place to ensure proper central oversight, delegation of authority, separation of duties, payment approval and documentation, and signed perjury statement certifications for all payments. Port disbursements are also regularly monitored against spending authorizations. All payment transactions and internal controls are subject to periodic Port internal audits and annual external audits conducted by both the State Auditor's Office and the Port's independent auditors. For the month of October 2024, over $115,107,988.66 in payments were made to nearly 587 vendors, comprised of 1,660 invoices and over 3,859 accounting expense transactions. About 96 percent of the accounts payable payments made in the month fall into Construction, Employee Benefits, Legal, Contracted Services, Utility Expenses, Janitorial Services, Sales Taxes, Software, Environmental Remediation, and Room/Space/Land Rental. Net payroll expense for the month of October was $16,186,460.26. Top 10 Payment Category Summary: Category Construction Employee Benefits Legal Contracted Services Utility Expenses Janitorial Services Sales Taxes Software Environmental Remediation Room/Space/Land Rental Other Categories Total Net Payroll Total Payments Payment Amount 77,039,878.90 8,622,930.57 7,829,740.64 6,972,808.59 2,441,292.67 2,276,675.52 1,661,250.09 1,347,697.84 1,099,460.29 744,139.14 5,072,114.14 16,186,460.26 $131,294,448.92 Page 19 of 373 Page 4 of 3 COMMISSION AGENDA - Action Item No. 8b.2 Meeting Date: April 22, 2025 Appropriate and effective internal controls are in place to ensure that the above obligations were processed in accordance with Port of Seattle procurement/payment policies and delegation of authority. At a meeting of the Port Commission held on April 22, 2025, it is hereby moved that, pursuant to RCW 42.24.180, the Port Commission approves the Port Auditor's payment of the above salaries and claims of the Port: Port Commission Page 20 of 373 COMMISSION AGENDA MEMORANDUM Item No. ACTION ITEM Date of Meeting DATE: April 15, 2025 TO: Steve Metruck, Executive Director FROM: Eloise Olivar, AFR Assistant Director Disbursements SUBJECT: Claims and Obligations - November 2024 8b.3 April 22, 2025 ACTION REQUESTED Request Port Commission approval of the Port Auditor's payment of the salaries and claims of the Port pursuant to RCW 42.24.180 for payments issued during the period November 01 through 30, 2024 as follows: Payment Type Accounts Payable Checks Accounts Payable Manual Checks Accounts Payable ACH **Accounts Payable Electronic Fund Transfer (EFT) Payroll Checks Payroll ACH Total Payments Payment Reference Start Number 955311 102180 069210 069374 Payment Reference End Number 955645 102221 069870 SXL383-410 226615 1216143 227140 1222704 Amount $11,575,279.52 $623,712.88 $67,724,687.92 $35,153,863.39 $324,543.57 $17,586,776.48 $132,988,863.76 **This line item includes four wire transfer totaling $6,068,870.00. Due to recovery from system outage, new series of payment reference numbers were generated. Pursuant to RCW 42.24.180, "the Port's legislative body" (the Commission) is required to approve in a public meeting all payments of claims within one month of issuance. OVERSIGHT All these payments have been previously authorized either through direct Commission action or delegation of authority to the Executive Director and through his or her staff. Detailed information on Port expenditures is provided to the Commission through comprehensive budget presentations as well as the publicly released Budget Document, which provides an even greater level of detail. The Port's operating and capital budget is approved by resolution in December for the coming fiscal year, and the Commission also approves the Salary and Benefit Resolution around the same time to authorize pay and benefit programs. Notwithstanding the Port's budget approval, individual capital projects and contracts exceeding certain dollar thresholds are also subsequently brought before the Commission for specific authorization prior to commencement of the project or contract-if they are below the thresholds the Executive Director is delegated authority to approve them. Expenditures are monitored against budgets monthly by management and reported comprehensively to the Commission quarterly. Page 21 of 373 Page 2 of 3 COMMISSION AGENDA - Action Item No. 8b.3 Meeting Date: April 22, 2025 Effective internal controls over all Port procurement, contracting and disbursements are also in place to ensure proper central oversight, delegation of authority, separation of duties, payment approval and documentation, and signed perjury statement certifications for all payments. Port disbursements are also regularly monitored against spending authorizations. All payment transactions and internal controls are subject to periodic Port internal audits and annual external audits conducted by both the State Auditor's Office and the Port's independent auditors. For the month of November 2024, over $115,077,543.71 in payments were made to nearly 654 vendors, comprised of 2,074 invoices and over 4,299 accounting expense transactions. About 93 percent of the accounts payable payments made in the month fall into Construction, Employee Benefits, Contracted Services, Payroll Taxes, Public Expenses, Utility Expenses, Insurance, Janitorial Services, Sales Taxes, and Software. Net payroll expense for the month of November was $17,911,320.05. Top 10 Payment Category Summary: Category Construction Employee Benefits Contracted Services Payroll Taxes Public Expenses Utility Expenses Insurance Janitorial Services Sales Taxes Software Other Categories Total Net Payroll Total Payments Payment Amount 56,507,549.64 17,723,257.74 10,516,916.92 6,592,489.42 6,265,885.47 2,684,229.73 1,821,702.00 1,708,454.14 1,661,250.09 1,560,542.17 8,035,266.39 17,911,320.05 $132,988,863.76 Page 22 of 373 Page 3 of 3 COMMISSION AGENDA - Action Item No. 8b.3 Meeting Date: April 22, 2025 Appropriate and effective internal controls are in place to ensure that the above obligations were processed in accordance with Port of Seattle procurement/payment policies and delegation of authority. At a meeting of the Port Commission held on April 22, 2025, it is hereby moved that, pursuant to RCW 42.24.180, the Port Commission approves the Port Auditor's payment of the above salaries and claims of the Port: Port Commission Page 23 of 373 COMMISSION AGENDA MEMORANDUM Item No. ACTION ITEM Date of Meeting DATE: April 15, 2025 TO: Steve Metruck, Executive Director FROM: Eloise Olivar, AFR Assistant Director Disbursements SUBJECT: Claim and Obligations - December 2024 __8b.4__________ April 22, 2025 ACTION REQUESTED Request Port Commission approval of the Port Auditor's payment of the salaries and claims of the Port pursuant to RCW 42.24.180 for payments issued during the period December 01 through 31, 2024 as follows: Payment Type Accounts Payable Checks Accounts Payable Manual Checks Accounts Payable ACH **Accounts Payable Electronic Fund Transfer (EFT) Payroll Checks Payroll ACH Total Payments Payment Reference Start Number 955646 101041 069871 102964 Payment Reference End Number 955971 101961 071978 SHR-78 227141 1222705 227555 1227494 Amount $7,489,947.23 $16,903.50 $106,858,516.87 $19,556,762.88 $160,133.84 $17,535,435.54 $151,617,699.86 ** This line item includes ten wire transfers totaling $805,129.57. Due to recovery from system outage, new series of payment reference numbers were generated. Pursuant to RCW 42.24.180, "the Port's legislative body" (the Commission) is required to approve in a public meeting, all payments of claims within one month of issuance. OVERSIGHT All these payments have been previously authorized either through direct Commission action or delegation of authority to the Executive Director and through his or her staff. Detailed information on Port expenditures is provided to the Commission through comprehensive budget presentations as well as the publicly released Budget Document, which provides an even greater level of detail. The Port's operating and capital budget is approved by resolution in December for the coming fiscal year, and the Commission also approves the Salary and Benefit Resolution around the same time to authorize pay and benefit programs. Notwithstanding the Port's budget approval, individual capital projects and contracts exceeding certain dollar thresholds are also subsequently brought before the Commission for specific authorization prior to commencement of the project or contract - if they are below the thresholds the Executive Director is delegated authority to approve them. Expenditures are monitored against budgets monthly by management and reported comprehensively to the Commission quarterly. Page 24 of 373 COMMISSION AGENDA - Action Item No. 8b.4 Page 2 of 3 Meeting Date: April 22, 2025 Effective internal controls over all Port procurement, contracting and disbursements are also in place to ensure proper central oversight, delegation of authority, separation of duties, payment approval and documentation, and signed perjury statement certifications for all payments. Port disbursements are also regularly monitored against spending authorizations. All payment transactions and internal controls are subject to periodic Port internal audits and annual external audits conducted by both the State Auditor's Office and the Port's independent auditors. For the month of December 2024, over $133,922,130.48 in payments were made to nearly 615 vendors, comprised of 3,799 invoices and over 41,190 accounting expense transactions. About 97 percent of the accounts payable payments made in the month fall into the Construction, Employee Benefits, Contracted Services, Environmental Remediation, Payroll Taxes, Janitorial Services, Maintenance Inventory, Utility Expenses, Sales Taxes, and Public Expense. Net payroll expense for the month of December was $17,695,569.38. Top 10 Payment Category Summary: Category Construction Employee Benefits Contracted Services Environmental Remediation Payroll Taxes Janitorial Services Maintenance Inventory Utility Expenses Sales Taxes Public Expense Other Categories Total Net Payroll Total Payments Payment Amount 88,050,151.46 10,472,443.39 8,335,784.17 6,996,529.80 6,598,003.33 2,377,178.31 2,307,622.00 1,961,279.74 1,661,250.09 1,622,664.31 3,539,223.88 17,695,569.38 $151,617,699.86 Page 25 of 373 COMMISSION AGENDA - Action Item No. 8b.4 Page 3 of 3 Meeting Date: April 22, 2025 Appropriate and effective internal controls are in place to ensure that the above obligations were processed in accordance with Port of Seattle procurement/payment policies and delegation of authority. At a meeting of the Port Commission held on April 22, 2025, it is hereby moved that, pursuant to RCW 42.24.180, the Port Commission approves the Port Auditor's payment of the above salaries and claims of the Port: _________________________________ _________________________________ _________________________________ _________________________________ _________________________________ Port Commission Page 26 of 373 COMMISSION AGENDA MEMORANDUM Item No. ACTION ITEM Date of Meeting DATE: March 17, 2025 TO: Stephen P. Metruck, Executive Director FROM: Jeff Wolf, Director, Aviation Commercial Management Khalia Moore, Assistant Director, Airport Dining and Retail Bridget Boldt, Manager, Business Development & Operations 8c April 22, 2025 SUBJECT: Airport Dining and Retail Amendments Amount of this request: $739,725 ACTION REQUESTED Request Commission authorization for the Executive Director to (1) execute Termination Agreements; (2) payout where applicable Net Book Value (NBV) associated with the Termination Agreements; (3) execute Lease and Concession Agreements and Amendments for certain Airport Dining and Retail (ADR) Tenants impacted by various capital projects and unforeseen construction-related delays. EXECUTIVE SUMMARY SEA Gateway/NMTR Project: On June 27, 2023, Commission authorized supplemental funding and work as part of Phase B of the SEA Gateway/North Main Terminal Redevelopment (NMTR) Program. Phase B work enhances the security screening checkpoint on the far north-end of the terminal and renovates the restrooms adjacent to the Hudson, NE-05 location. As a part of this project, the Hudson location will be closed for an elongated period and subsequent access to this location will be permanently blocked by passenger queueing making it a non-viable concessions location requiring a Termination Agreement and NBV buyout of this location. Airline Realignment Project: On June 25, 2024, Commission authorized supplemental funding and the execution of a construction contract amendment for the Post IAF Realignment Project. The scope of work includes the renovation of ticket counters and tenant-leased space in the central main terminal to provide ten ticketing positions, an airline breakroom and leasable space for a future tenant. The impacted area includes the Alki Bakery, SE-03 location, requiring its permanent closure and associated Termination Agreement and NBV buyout. Template revised January 10, 2019. Page 27 of 373 COMMISSION AGENDA - Action Item No. 8c Meeting Date: April 22, 2025 Page 2 of 6 Concourse A Duty-Free Project: As part of the Lease and Concession Agreement dated June 22, 2016, for space CA-06, Africa Lounge, the Port is required to provide a new location should the Port reclaim the space prior to the natural termination of the agreement. On October 24, 2023, Commission authorized the execution of a new Lease and Concession Agreement for the replacement of CA-06, Africa Lounge due to the impact (displacement) due to the Concourse A Duty-Free Project. The initial approved replacement location is a portion, approximately 40%, the size of the existing Africa Lounge footprint. This request is to provide the SeaTac Bar Group tenant with a secondary inline space as an equitable square footage allocation for the term of 12 years. Terminal Seating Project: As part of the Lease and Concession Agreement dated June 22,2016, as amended on April 12, 2018, the Port is required to provide a new location should the Port reclaim a space prior to the natural termination of the agreement. Concourse Concessions was allocated a kiosk space CA-17 (f/k/a CA-16) which was replaced by a terminal seating project. The request is to provide the Concourse Concessions tenant with an equitable kiosk term of eight years applied to the current Hachi-ko location, CC-16. Concourse C Temporary Air Handling Units Project: On August 11, 2020, Commission authorized the design and construction of two (2) temporary air handling units for Concourse C necessary to support the new restrooms and three (3) additional leased ADR locations which were leased and to be constructed. Due to project delays, Host LPI SEA FB could not proceed with the design and construction of the Skillet location, CC-11, and as a result incurred additional increased design and construction costs. The request is to modify the rent structure to offset the costs incurred due to capital project delays. Additionally, the request is also to compensate Host LPI SEA FB the amount of $275,000 for specific construction costs related to unknown site conditions due to capital construction projects. Phased Construction Schedule: Post-pandemic, the Port determined to phase construction for the remaining N Concourse tenant buildouts. This resulted in the delay of the P.F. Chang's location, NSM-26 for a prolonged period resulting in increased design and construction costs. The request is to modify the rent structure to offset the additional costs incurred due to Port's phased construction. Checkpoint 1: On March 22, 2021, Commission authorized the construction relocation of Checkpoint 1 to the Gina Marie Lindsay Hall. The request is to include the new Checkpoint 1 into the premises of the contract and extend the term for Security Point Media to expire in 2032 as the provider of bins to TSA. Template revised June 27, 2019 (Diversity in Contracting). Page 28 of 373 COMMISSION AGENDA - Action Item No. 8c Meeting Date: April 22, 2025 Page 3 of 6 JUSTIFICATION These amendments are necessary to maintain the long-term health and viability of the ADR program at Seattle-Tacoma International Airport (SEA or Airport). As the capital program continues to evolve to meet the ongoing demand of the Airport, these amendments align tenant contracts impacted due to the variability of construction of capital projects. These amendments cover tenants of various sizes, company structure and WMBE status. Diversity in Contracting The ADR program is governed by the Federal Aviation Administration (FAA) and will include Airport Concession Disadvantage Business Enterprise (ACDBE) aspirational goals in line with the Aviation Business Goals and Objectives. Current 2025 goals for ACDBE participation stands at 25%. DETAILS Termination Agreements 1) Termination Agreement associated with the SEA Gateway/North Main Terminal Redevelopment (NMTR) Project effective November 5, 2024:  Seattle Air Ventures JV, location NE-05 (Hudson) 2) Termination Agreement associated with Airline Realignment Project effective June 15, 2025:  Seattle Air Ventures JV, location SE-03 (Alki Bakery) NBV Amounts NBV buyout Amounts for the applicable Lease and Concession Agreements broken out by project impact are as follows: 1) SEA Gateway/NMTR Project Seattle Air Ventures JV: $ 174,725 2) Airline Realignment Seattle Air Ventures JV: $ 290,000 Total Buyout $ 464,725 New Lease and Concession Agreements and Lease and Concession Agreement Amendments: New Lease and Concession Agreements associated with capital projects: 1. Concourse Concessions, LLC, replaces impacted location CA-16. 2. SeaTac Bar Group, LLC, replaces impacted location CA-04. Template revised June 27, 2019 (Diversity in Contracting). Page 29 of 373 COMMISSION AGENDA - Action Item No. 8c Meeting Date: April 22, 2025 Page 4 of 6 Lease and Concession Agreement Amendments associated with capital projects and unforeseen construction-related delays: 1. Host LPI SEA FB, LLC, CC-11 (Skillet) modified rent structure due to the construction delays and compensation of $275,000 for specific construction costs related to unknown site conditions. 2. CI Grove Bay SEA, LLC, NSM-26 (P.F. Chang's) modified rent structure related to Port construction phasing. 3. SecurityPoint Media, LLC (TSA security lanes and bins) modify the Premises to include the new Checkpoint 1 and extend the term for an additional five (5) years. ALTERNATIVES AND IMPLICATIONS CONSIDERED Alternative 1 - Do not payout tenants Net Book Values. Cost Implications: Unknown. Pros: (1) Cons: (1) No immediate dollars required. Required to be paid out per the lease when space is taken back for operational need and failure to do so would potentially open the Port up to litigation. This is not the recommended alternative. Alternative 2 - Not provide replacement space to affected tenants. Cost Implications: Unknown. Pros: (1) Cons: (1) Provide new opportunities for those spaces to new small businesses to the airport. Replacement space is required by lease when space is taken back for operational need and failure to do so would potentially open the Port up to litigation This is not the recommended alternative. Alternative 3 - Not provide the affected tenants with modified rent structures due to Port caused impacts. Cost Implications: Unknown. Pros: (1) Would maintain current rent structures as currently leased. Template revised June 27, 2019 (Diversity in Contracting). Page 30 of 373 COMMISSION AGENDA - Action Item No. 8c Meeting Date: April 22, 2025 Page 5 of 6 Cons: (1) Unduly impacts tenant and joint venture ACDBE and Small Business partners impacted by capital projects and Port construction phasing who have been financially burdened during the design and construction process for grossly elongated periods. This is not the recommended alternative. Alternative 4 - Move forward with all proposed lease buyouts, amendments and new agreements. Cost Implications: $739,725 plus reduced future rent with modified rent structures for certain tenants. Pros: (1) Cons: (1) (2) Equitable approach addresses the negative circumstances faced by each individual concessionaire as described above. Decrease in customer offerings on the Ticketing level. Decrease in estimated revenues to the Port in rent. This is the recommended alternative. FINANCIAL IMPLICATIONS As noted above, two locations- NE-05 Hudson and SE-03 Alki Bakery, include NBV buyouts to the tenants in the total amount of $464,725 for both locations. In addition, this request includes a payment in the amount of $275,000 to CC-11 Skillet. The total of these amounts is $739,725 and will reduce Non-Aeronautical NOI. Two locations, Skillet and P.F. Chang's, include proposed lease rate (percentage fees paid to the Port) reductions, lowering future revenues to the Port. Skillet Given the rent reduction for Skillet, Port revenue would be decreased by an estimated $1.3 million in the first five years based on current sales projections for the location. Since the rent tiers go back up to the original rates in 2030, all relief is realized in the first five years. Template revised June 27, 2019 (Diversity in Contracting). Page 31 of 373 COMMISSION AGENDA - Action Item No. 8c Meeting Date: April 22, 2025 Page 6 of 6 P.F. Chang's Given the rent reduction for P.F. Chang's, Port revenue would be decreased by an estimated $1.8 million in the first eight years based on current sales projections. Since the rent tiers progressively increase, anticipated relief is realized by 2032. PF Chang's Revenue to Port Difference to Rent Structure (Present Value) Original Original (12%) $7,810,000 $Scenario 1: (7%) $4,550,000 ($3,260,000) Scenario 2: (7%, 9%) $5,170,000 ($2,640,000) Proposed for Approval (7%, 9%, 12%) $6,000,000 ($1,810,000) - Analysis period 2025-2036 - For relief scenarios, timing is as follows: Scenario 1: 7% until end of term Scenario 2:Two Phase: 7% 2025-2030, 9% 2031-end of term Proposed for Approval: 7% 2025-2028, 9% 2029-2032, 12% 2033-end of term - Discount rate of 6% per Port risk scoring matrix ATTACHMENTS TO THIS REQUEST (1) Presentation PREVIOUS COMMISSION ACTIONS OR BRIEFINGS June 25, 2024 - The Commission authorized supplemental funding and the execution of a construction contract amendment for the Post IAF Realignment Project October 24, 2023 - The Commission authorized Termination Agreements for tenants impacted by the Concourse A Duty-Free Expansion. June 27, 2023 - The Commission authorized supplemental funding and work as part of Phase B of the SEA Gateway/North Main Terminal Redevelopment (NMTR) Program. March 8, 2022 - The Commission approved the revised recommendations provided by staff in response to Order 2021-15 for the SEA Tenant Build-Out Analysis. August 11, 2020, and subsequently revised on April 12, 2022, Commission authorized the design and construction of two (2) temporary air handling units for Concourse C necessary to support the new restrooms and three (3) additional leased ADR locations which were leased and to be constructed. Template revised June 27, 2019 (Diversity in Contracting). Page 32 of 373 Item No. 8c_supp Meeting Date: April 22, 2025 Airport Dining & Retail Amendments Khalia Moore Assistant Director, Airport Dining & Retail Bridget Boldt Manager, Business Development & Operations Page 33 of 373 Request for Approval • Executive Director execution of Termination Agreements for Airport Dining and Retail (ADR) spaces impacted by SEA Gateway/North Main Terminal Redevelopment (NMTR) and Airline Realignment projects. • Executive Director execution of one (1) new leases for space impacted by Concourse A Duty-Free Expansion and one (1) new lease for space impacted by Terminal Seating Project. • Executive Director execution of three (3) Lease and Concession Amendments for certain ADR Tenants impacted by various capital projects and unforeseen construction-related delays. • Total amount of request: $739,725 2 Page 34 of 373 Terminations - Impacted Spaces & Financial Implications SEA Gateway/NMTR Project • Seattle Air Ventures JV (NE-05): $174,725 Airline Realignment Project • Seattle Air Ventures JV (SE-03): $290,000 Total Buyout $464,725 3 Page 35 of 373 New Lease Agreements Concourse C • CC-16: Concourse Concessions, LLC, replaces impacted location CA-17 (f/k/a CA-16). - 8-year term. - Equitable term for long-term kiosk space replacement. Concourse A • CA-16: SeaTac Bar Group, LLC, replaces impacted location CA-04. - 12-year term. - Equitable square footage allocation for Duty-Free displacement. 4 Page 36 of 373 Lease Amendments Concourse C • Host LPI SEA FB, LLC (CC-11): - modified rent structure due to the construction delays. - compensation of $275,000 for specific construction costs related to unknown site conditions. Concourse N • CI Grove Bay SEA, LLC (NSM-26): - modified rent structure due to Port construction phasing. Airport Security Checkpoints • SecurityPoint Media, LLC: - modify premises to include new Checkpoint 1. - extend term five (5) years. 5 Page 37 of 373 QUESTIONS 6 Page 38 of 373 COMMISSION AGENDA MEMORANDUM Item No. ACTION ITEM Date of Meeting DATE: April 11, 2025 TO: Stephen P. Metruck, Executive Director FROM: Eileen Francisco, Director, Aviation Project Management Keri Stephens, Director, Aviation Facilities and Capital Programs 8e April 22, 2025 SUBJECT: Water Reservoir Rehabilitation CIP #C801172 Additional Authorization Request Amount of this request: Total estimated project cost: $1,600,000 $5,169,000 ACTION REQUESTED Request Commission authorization for the Executive Director to increase the Capital Improvement project authorization for the Water Reservoir Rehabilitation project by $1,600,000. The amount of this request is for $1,600,000 for a revised total estimated project cost not to exceed $5,169,000. SUMMARY The 2-million-gallon water reservoir at Seattle-Tacoma International Airport is an above ground steel tank that provides water storage for domestic use and fire suppression to the entire airport. This project will rehabilitate the structure to extend its useful life. The scope of this project was based off a September 2021 inspection report which indicated that severe corrosion has appeared in many areas on the reservoir and, if not addressed, could result in deformation of the structure. The presence of rust also puts the water quality into jeopardy. Roof repairs in addition to the coating replacement were not included in the report but became apparent once the contractor entered the tank and evaluated the current tank conditions. The project was advertised for bids on July 9th, 2024, and was awarded to T-Bailey on August 29, 2024. The contractor mobilized and entered the tank to examine existing conditions on January 21, 2025, when they observed severe corrosion of the roof. A full roof replacement was recommended since it would be significantly more costly to repair the existing roof structure. On January 28th, 2025, the project structural engineer arrived on site to visually inspect the roof and concurred that, due to the amount of corrosion, the roof requires replacement. A change order will be developed to execute this work. There are no attachments to this memo. Template revised April 12, 2018. Page 39 of 373 COMMISSION AGENDA MEMORANDUM Item No. ACTION ITEM Date of Meeting DATE : March 17, 2025 TO: Stephen P. Metruck, Executive Director FROM: Sarah Ogier, Director-Maritime Environment & Sustainability Alex Adams, Sr. Manager Environmental Programs David Fujimoto, Sr. Environmental Program Manager 8f April 22, 2025 SUBJECT: Authorization of Clean Ports Planning Grant Use of Funds Prior request: Amount of this request: Total estimated project cost: $ 1,060,000 $ 1,937,248 $ 2,997,248 ACTION REQUESTED Request Commission authorization for the Executive Director to: 1) expend up to $1,937,248 in grant funds; and 2) to execute related service agreements, not to exceed $1,471,600, to achieve the results of the EPA Clean Ports Program Climate and Air Quality Planning Grant. EXECUTIVE SUMMARY The Port of Seattle applied for approximately $3 million in funding through the U.S. Environmental Protection Agency (EPA) Clean Ports Program (CPP) Climate and Air Quality Planning Competition to accelerate efforts to transition to low and zero emissions harbor craft and advanced clean maritime fuels for ocean-going vessels. The Port was awarded $2,997,248 for its proposal titled, "Powering the Maritime Transition in the Pacific Northwest." In May 2024, the Commission authorized a competition waiver and execution of service agreements with three non-profit partners as sub-recipients in the amount of $1,060,000. This request seeks authorization to expend the balance of grant funds for project management and service agreements for technical analysis, community engagement, strategy planning, and workforce development to meet the objectives of the grant award. The Port will institute project management, contractual, and financial management measures to reduce exposure to financial risk. Below is a summary of the authorization requests: Template revised January 10, 2019. Page 40 of 373 COMMISSION AGENDA - Action Item No. 8f Meeting Date: April 22, 2025 Date May 21, 2024 Amount $1,060,000 Additional Grant Authorization (this request) $1,937,248 Total $2,997,248 Page 2 of 5 Description Competition waiver, authorization to name designated sub-recipients and enter into agreements with Washington Maritime Blue, American Bureau of Shipping (ABS), and RMI subject to grant award Budget authorization for the balance of funds and authorization to execute related service agreements JUSTIFICATION The Port's Clean Ports project addresses two key maritime sectors serving the Port and is designed to accelerate pathways to reduce emissions and meet the goals of the Port's Century Agenda, the Northwest Port's Clean Air Strategy, and the Maritime Climate and Air Action Plan. The project provides funding for a variety of activities including: a vessel activity and fuel inventory; harbor vessel modernization feasibility study; fuel demand and infrastructure analysis; a fuel supply acquisition strategy; methanol bunkering desktop exercise; a fuel strategy roadmap; community engagement to help ensure neighboring communities and interested parties are informed and educated about future fuels (vital to long-term success as new fuels are deployed in the region); and an assessment of workforce impacts to inform the Port's Workforce Development strategies. In addition, the grant provides for project management to ensure successful execution of all grant conditions. As a one-time funding opportunity, the EPA Clean Ports Program award is a unique opportunity for the Port to leverage federal funds and significantly expand existing resources. This award enables the Port to work with nationally recognized partners and develop strategies to increase the region's competitiveness. Given the ongoing uncertainty of federal grant funds, staff have conferred with project partners and has confirmed their interest in continuing to move forward with the project. The Port expects to establish measures to manage funding risk including increased frequency of grant reimbursement, contractual conditions specifying grant-contingent funding, increased monitoring and reporting frequencies, and contractor risk evaluations. Diversity in Contracting The Maritime Environment and Sustainability Department will evaluate opportunities for women and minority-owned business enterprise (WMBE) services for consultant contracts directly managed by the Port under this grant pursuant to Port policies and grant requirements. Template revised June 27, 2019 (Diversity in Contracting). Page 41 of 373 COMMISSION AGENDA - Action Item No. 8f Meeting Date: April 22, 2025 Page 3 of 5 DETAILS This project will help catalyze the transition to next generation vessels and prepare the region, maritime industry, communities, ports, and workforce for the transition to advanced clean fuels. Please see Attachment 3 for a description of the Scope of Work and Schedule. Cost Breakdown Prior Request Personnel Contracts Subawards Other Costs (participant support: translation, meals, etc.) Total This Request Total Project $1,060,000 - $455,523 $721,600 $750,000 $10,125 $455,523 $721,600 $1,810,000 $10,125 $1,060,000 $1,937,248 $2,997,248 ALTERNATIVES AND IMPLICATIONS CONSIDERED Alternative 1 - Do not authorize the expenditure of funds Cost Implications: ($1,937,248 - $2,997,248) - loss of funds Pros: (1) Cons: (1) (2) (3) (4) Reduces staff time for project delivery support, potentially freeing time for other efforts. The Port would need to identify alternative sources of funding and/or phase project elements over several years to complete a similar body of work. If previously authorized elements were to proceed, a failure to authorize significant remaining portions of the grant project would require renegotiation of the grant scope, which would likely jeopardize overall project funding. If previously authorized elements were to proceed, a failure to authorize significant remaining portions would mean there would be no project management support for sub-recipient projects previously approved. Port does not gain the benefit of these analyses. Without additional understanding of these issues, the Port is not prepared for this transition to future fuels. This is not the recommended alternative. Alternative 2 - Delay authorization of funds. Cost Implications: unknown Pros: (1) Delaying authorization of funds may provide for additional clarity regarding the availability of funds with program changes at the federal level. Template revised June 27, 2019 (Diversity in Contracting). Page 42 of 373 COMMISSION AGENDA - Action Item No. 8f Meeting Date: April 22, 2025 Cons: (1) (2) (3) Page 4 of 5 Delaying implementation of the project could impact the Port's ability to deliver the project within the timeframe of the grant award and may require renegotiation of the schedule with EPA. Delays in authorization of this request would negatively impact the previously authorized portions of work. Project management support for sub-recipient projects and grant administration to meet all necessary conditions would be limited. The Port already expects to implement measures to manage funding risk, including but not limited to contractual conditions specifying contingent funding, increased monitoring and reporting frequencies, and contractor risk evaluations. This is not the recommended alternative. Alternative 3 - Authorize the use of funds, including contingency funds, and execution of service agreements needed for implementation of the grant award. Cost Implications: $1,937,248 Pros: (1) (2) (3) (4) (5) Cons: (1) (2) Allows the Port to leverage federal funding to advance Port goals. Allows the Port to follow through on current commitments to EPA. All project subrecipients have confirmed their interest and ability to proceed with the project within the uncertain funding environment. A combination of Port instituted contract provisions, increased frequency of project reimbursement, and contingency funds will reduce financial exposure and risk. Through successful grant project implementation, the Port intends to gain critical market, community and technical insights to guide the agency in the fuels of the future transition. The Port will need to closely monitor funding availability and subrecipient expenditures considering uncertainties in the current federal funding environment. Availability of funding through the term of the grant award is uncertain at this time and conditions are highly unpredictable. This is the recommended alternative. FINANCIAL IMPLICATIONS Cost Estimate/Authorization Summary Capital Expense Total COST ESTIMATE Original estimate $0 $0 $0 AUTHORIZATION Previous authorizations 0 $1,060,000 $1,060,000 Template revised June 27, 2019 (Diversity in Contracting). Page 43 of 373 COMMISSION AGENDA - Action Item No. 8f Meeting Date: April 22, 2025 Current request for authorization Total authorizations, including this request Remaining amount to be authorized Page 5 of 5 0 0 $0 $1,937,248 $2,997,248 $0 $1,937,248 $2,997,248 $0 Annual Budget Status and Source of Funds This work is fully funded by the EPA Climate and Air Quality Planning Grant and the grant does not require matching funds. This request is to authorize the expenditure of those funds. Financial Analysis and Summary Project cost for analysis Business Unit (BU) Effect on business performance (NOI after depreciation) IRR/NPV (if relevant) CPE Impact $2,997,248 Environmental and Sustainability Programs Up to $2,997,248 in expenditures will be offset by grant revenues. n/a n/a Future Revenues and Expenses (Total cost of ownership) n/a ATTACHMENTS TO THIS REQUEST (1) (2) (3) Grant award Scope of Work Summary Presentation slides PREVIOUS COMMISSION ACTIONS OR BRIEFINGS May 21, 2024 - The Commission determined a competitive process was not appropriate, authorized the Port to specify three named non-profit partners as sub-awardees in this grant application, and authorized the Port to execute resulting service agreements pending funding award. Template revised June 27, 2019 (Diversity in Contracting). Page 44 of 373 Item No. 8f attach-1 Meeting Date: April 22, 2025 5Y - 02J92401 - 0 U.S. ENVIRONMENTAL PROTECTION AGENCY Grant Agreement GRANT NUMBER (FAIN): MODIFICATION NUMBER: PROGRAM CODE: TYPE OF ACTION New PAYMENT METHOD: ASAP RECIPIENT TYPE: Municipal RECIPIENT: Send Payment Request to: rtpfc-grants@epa.gov PAYEE: Port of Seattle 2711 Alaskan Way Seattle, WA 98121-1107 EIN: 91-6001025 Port of Seattle 2711 Alaskan Way Seattle, WA 98121-1107 PROJECT MANAGER David Fujimoto 2711 Alaskan Way Seattle, WA 98121-1107 Email: fujimoto.d2@portseattle.org Phone: 206-787-3517 EPA PROJECT OFFICER Elizabeth Carper 1200 Sixth Ave, Suite 155 Seattle, WA 98101-3144 Email: Carper.Beth@epa.gov Phone: 206-553-1906 02J92401 0 5Y Page 1 DATE OF AWARD 12/09/2024 MAILING DATE 12/12/2024 ACH# X0308 EPA GRANT SPECIALIST Charles Devoe 1200 Sixth Ave, Suite 155 Seattle, WA 98101-3144 Email: devoe.charles@epa.gov Phone: 206-553-6291 PROJECT TITLE AND DESCRIPTION Powering the Maritime Transition in the Pacific Northwest See Attachment 1 for project description. BUDGET PERIOD 01/01/2025 - 12/31/2027 PROJECT PERIOD 01/01/2025 - 12/31/2027 TOTAL BUDGET PERIOD COST $ 2,997,248.00 TOTAL PROJECT PERIOD COST $ 2,997,248.00 NOTICE OF AWARD Based on your Application dated 05/28/2024 including all modifications and amendments, the United States acting by and through the US Environmental Protection Agency (EPA) hereby awards $ 2,997,248.00. EPA agrees to cost-share 100.00% of all approved budget period costs incurred, up to and not exceeding total federal funding of $ 2,997,248.00. Recipient's signature is not required on this agreement. The recipient demonstrates its commitment to carry out this award by either: 1) drawing down funds within 21 days after the EPA award or amendment mailing date; or 2) not filing a notice of disagreement with the award terms and conditions within 21 days after the EPA award or amendment mailing date. If the recipient disagrees with the terms and conditions specified in this award, the authorized representative of the recipient must furnish a notice of disagreement to the EPA Award Official within 21 days after the EPA award or amendment mailing date. In case of disagreement, and until the disagreement is resolved, the recipient should not draw down on the funds provided by this award/amendment, and any costs incurred by the recipient are at its own risk. This agreement is subject to applicable EPA regulatory and statutory provisions, all terms and conditions of this agreement and any attachments. ISSUING OFFICE (GRANTS MANAGEMENT OFFICE) ORGANIZATION / ADDRESS AWARD APPROVAL OFFICE ORGANIZATION / ADDRESS U.S. EPA, Region 10, EPA Region 10 Mail Code: 17-C04, 1200 Sixth Avenue, Suite 155 Seattle, WA 98101 U.S. EPA, Region 10, EPA Region 10 R10 - Region 10 1200 Sixth Ave, Suite 155 Seattle, WA 98101-3144 THE UNITED STATES OF AMERICA BY THE U.S. ENVIRONMENTAL PROTECTION AGENCY Digital signature applied by EPA Award Official Andrea Manion - Grants Management Officer DATE 12/09/2024 Page 45 of 373 5Y - 02J92401 - 0 Page 2 EPA Funding Information FUNDS FORMER AWARD THIS ACTION AMENDED TOTAL EPA Amount This Action $0 $ 2,997,248 $ 2,997,248 EPA In-Kind Amount $0 $0 $0 Unexpended Prior Year Balance $0 $0 $0 Other Federal Funds $0 $0 $0 Recipient Contribution $0 $0 $0 State Contribution $0 $0 $0 Local Contribution $0 $0 $0 Other Contribution $0 $0 $0 Allowable Project Cost $0 $ 2,997,248 $ 2,997,248 Assistance Program (CFDA) Statutory Authority Regulatory Authority 66.051 - Clean Ports Program Inflation Reduction Act: Sec. 60102 2 CFR 200, 2 CFR 1500 and 40 CFR 33 Clean Air Act: Sec. 133 Fiscal Site Name - Req No FY Approp. Code 2510IRG014 2227 E4SF6 Budget Organization 10B4 PRC Object Class Site/Project Cost Organization 000AVFXY3 4166 - - Obligation / Deobligation $ 2,997,248 $ 2,997,248 Page 46 of 373 5Y - 02J92401 - 0 Page 3 Budget Summary Page Table A - Object Class Category (Non-Construction) 1. Personnel 2. Fringe Benefits 3. Travel 4. Equipment 5. Supplies 6. Contractual 7. Construction 8. Other 9. Total Direct Charges 10. Indirect Costs: 0.00 % Base 0.00 % Federal ______ 100.00 %) 11. Total (Share: Recipient ______ 12. Total Approved Assistance Amount 13. Program Income 14. Total EPA Amount Awarded This Action 15. Total EPA Amount Awarded To Date Total Approved Allowable Budget Period Cost $ 350,402 $ 105,121 $0 $0 $0 $ 721,600 $0 $ 1,820,125 $ 2,997,248 $0 $ 2,997,248 $ 2,997,248 $0 $ 2,997,248 $ 2,997,248 Page 47 of 373 5Y - 02J92401 - 0 Page 4 Attachment 1 - Project Description The purpose of this award is to provide funding under the Inflation Reduction Act to the Port of Seattle. Specifically, the recipient will conduct emissions inventory and accounting exercises, analyze emissions reduction strategies, engage with port stakeholders, plan for reducing future port emissions, and conduct a workforce planning analysis. The activities include establishing and executing a project management plan; quantification and characterization of oceangoing vessels, harbor vessels, and fueling activity for vessels calling SeattleTacoma; assessing the availability of technology for electric vessels; identifying site requirements to support charging and hydrogen fueling infrastructure; analyzing zero-emission harbor vessel deployment strategies, energy requirements, and costs; analyzing zero-emission fuel demand; conducting a workforce impact analyses; and researching and analyzing the impacts of vessel decarbonization technologies. The anticipated deliverables include a project management plan, vessel activity and maritime fuel inventory, zero-emission technology assessment report, identification of priority sites for the initial deployment of zero-emission infrastructure in Seattle-Tacoma, a strategy analysis report for zeroemission harbor vessels and charging infrastructure deployment, a fuel infrastructure investment report, a zero-emission fuel supply acquisition strategy, stakeholder and community engagement events, a sustainable maritime fuels transition landscape assessment, a maritime fuels transition industry engagement plan, and a zero-emissions transition workforce impact analysis report and recommendations. The expected outcomes include a comprehensive understanding of vessel travel, fueling characteristics, and associated lifecycle emissions; improved understanding of available electric and hybrid propulsion systems, infrastructure, and fuel needs for enabling zero-emission charging and fueling; a better understanding of infrastructure site requirements and attributes to support zero-emission transition, and increased community and port readiness for zero-emission technology implementation. The intended beneficiaries include the Port of Seattle (grantee), Northwest Seaport Alliance and Port of Tacoma (partners), the National Renewable Energy Lab (subaward), RMI (subaward), Maritime Blue (subaward), American Bureau of Shipping (subaward), Washington State Department of Commerce (partner), Consortium for Hydrogen and Renewable E-Fuels (partner), Aspen Institute/ ZEMBA (partner), and Mærsk Mc-Kinney Møller Center for Zero Carbon Shipping (partner). The anticipated sub-award activities include a vessel activity and maritime fuel inventory, zero-emission technology assessment report, identification of priority sites for the initial deployment of zero-emission infrastructure in Seattle-Tacoma, a strategy analysis report for zero-emission harbor vessels and charging infrastructure deployment, a fuel infrastructure investment report, a zero-emission fuel supply acquisition strategy, a sustainable maritime fuels transition landscape assessment, and a maritime fuels transition industry engagement plan. Page 48 of 373 5Y - 02J92401 - 0 Page 5 Administrative Conditions GENERAL TERMS AND CONDITIONS The recipient agrees to comply with the current EPA general terms and conditions available at: https: //www.epa.gov/system/files/documents/202410/fy_2025_epa_general_terms_and_conditions_effective_october_1_2024_or_later.pdf These terms and conditions are in addition to the assurances and certifications made as a part of the award and the terms, conditions, or restrictions cited throughout the award. The EPA repository for the general terms and conditions by year can be found at: https://www.epa. gov/grants/grant-terms-and-conditions. A. CORRESPONDENCE Federal Financial Reports (SF-425): rtpfc-grants@epa.gov MBE/WBE reports (EPA Form 5700-52A): R10grants@epa.gov All other forms/certifications/assurances, Indirect Cost Rate Agreements, updates to recipient information (including email addresses, changes in contact information or changes in authorized representatives) and other notifications: R10grants@epa.gov Requests for Extensions of the Budget and Project Period, Quality Assurance documents, workplan revisions, equipment lists, programmatic reports and deliverables, Amendment Requests, Requests for other Prior Approvals: carper.beth@epa.gov Administrative questions and issues: devoe.charles@epa.gov B. PRE-AWARD COSTS In accordance with 2 CFR 1500.9, the recipient may charge otherwise allowable pre-award costs (both Federal and non-Federal matching shares) incurred from 01/01/2025 to the actual award date provided that such costs were contained in the approved application and all costs are incurred within the approved budget period. Page 49 of 373 5Y - 02J92401 - 0 Page 6 Programmatic Conditions Grant Programmatic Terms and Conditions A. Final Approved Workplan and Modifications 1. Recipient agrees to carry out the project in accordance with the final approved workplan. 2. Recipients are required to report deviations from budget or project scope or objective, and must request prior written approval from EPA: a. for any change in the scope or objective of the project or program (even if there is no associated budget revision requiring prior written approval); b. any change in key personnel (including employees and contractors) that are identified by name or position in the Federal award specified in the application or workplan; c. the disengagement from the project for more than three months, or a 25% reduction in time and effort devoted to the Federal award over the course of the period of performance, by the approved project director or project manager; d. the inclusion of costs that require prior approval in accordance with 2 CFR Part 200 Subpart E-Cost Principles or 48 CFR part 31, "Contract Cost Principles and Procedures," as applicable; e. the transfer of funds budgeted for participant support costs to other budget categories as defined in 2 CFR Section 200.1 Definitions to other categories of expense; f. unless described in the final approved workplan and budget, the subawarding, transferring or contracting out of any work under the award; g. for changes in the total approved cost-sharing by the recipient; or h. the need arises for additional Federal funds to complete the project. Requests for modifications to the approved workplan or budget, including additions, deletions, or changes in the schedule, must be submitted in a timely manner to the EPA Project Officer for approval, to minimize project delays. Depending on the type or scope of changes, a formal amendment to the award may be necessary. Major project modifications which include changes to the approved types and number of partners and equipment, or to the approved project partners and location(s) may not be allowed. B. Performance Reporting and Final Performance Report B1. Performance Reports - Content In accordance with 2 CFR 200.329, the recipient agrees to complete and submit electronic performance reports using reporting template(s), including the approved Clean Ports Project Reporting Template (EPA Form Number: 5900-690 or future revisions, as applicable), which will be provided by the project officer. The purpose of semi-annual performance reports is to provide updates on implementation of each Page 50 of 373 5Y - 02J92401 - 0 Page 7 project, including brief information on each of the following areas: 1. A comparison of accomplishments to the outputs/outcomes established in the assistance agreement work plan for the reporting period; 2. The reasons why any established outputs/outcomes were not met; 3. Additional information, analysis and explanation of cost overruns or higher-than-expected unit costs. Additionally, the recipient agrees to notify the EPA when a significant development occurs that could impact the award. Significant developments include events that enable meeting milestones and objectives sooner or at less cost than anticipated or that produce different beneficial results than originally planned. Significant developments also include problems, delays, or adverse conditions which will impact the ability to meet the milestones or objectives of the award, including outputs/outcomes specified in the assistance agreement work plan. If the significant developments negatively impact the award, the recipient must include information on their plan for corrective action and any assistance needed to resolve the situation. The final project report will include all categories of information required for semi-annual reporting, including a final description of all climate and air quality planning activities completed for each port, and how the documents were shared publicly. The final project report will also include a narrative summary of the project, the successes and lessons learned for the entire project. B2. Performance Reports - Frequency Throughout the 3-year performance period of the grant, the recipient agrees to submit semi-annual performance reports electronically to the EPA Project Officer by the due date following the conclusion of each semi-annual reporting period. The reporting periods are: January 1 - June 30: Report due date July 30. July 1 - December 31: Report due date January 30. The recipient must submit the final performance report no later than 120 calendar days after the end date of the period of performance. Per the reporting form guidance, additional reporting may be required if the grant is extended or at the discretion of the EPA Project Officer. B3. Subaward Performance Reporting The recipient must report on its subaward monitoring activities under 2 CFR 200.332(e). Examples of items that must be reported are: 1. Summaries of results of reviews of financial and programmatic reports. 2. Summaries of findings from site visits and/or desk reviews to ensure effective subrecipient performance. 3. Environmental results the subrecipient achieved. Page 51 of 373 5Y - 02J92401 - 0 Page 8 4. Summaries of audit findings and related pass-through entity management decisions. 5. Actions the pass-through entity has taken to correct deficiencies such as those specified at 2 CFR 200.332(f), 2 CFR 200.208 and the 2 CFR Part 200.339 Remedies for Noncompliance. If the recipient is unable to obtain this information, the recipient must report to EPA why the information is not available. C. Cybersecurity Condition Cybersecurity Grant Condition for Other Recipients, Including Intertribal Consortia 1. The recipient agrees that when collecting and managing environmental data under this assistance agreement, it will protect the data by following all applicable State or Tribal law cybersecurity requirements. 2.a. The EPA must ensure that any connections between the recipient's network or information system and EPA networks used by the recipient to transfer data under this agreement, are secure. For purposes of this Section, a connection is defined as a dedicated persistent interface between an Agency IT system and an external IT system for the purpose of transferring information. Transitory, user-controlled connections such as website browsing are excluded from this definition. If the recipient's connections as defined above do not go through the Environmental Information Exchange Network or the EPA's Central Data Exchange, the recipient agrees to contact the EPA Project Officer (PO) no later than 90 days after the date of this award and work with the designated Regional/Headquarters Information Security Officer to ensure that the connections meet the EPA security requirements, including entering into Interconnection Service Agreements as appropriate. This condition does not apply to manual entry of data by the recipient into systems operated and used by the EPA's regulatory programs for the submission of reporting and/or compliance data. b. The recipient agrees that any subawards it makes under this agreement will require the subrecipient to comply with the requirements in 2.a if the subrecipient's network or information system is connected to EPA networks to transfer data to the Agency using systems other than the Environmental Information Exchange Network or the EPA's Central Data Exchange. The recipient will be in compliance with this condition: by including this requirement in subaward agreements; and during subrecipient monitoring deemed necessary by the recipient under 2 CFR 200.332(e), by inquiring whether the subrecipient has contacted the EPA Project Officer. Nothing in this condition requires the recipient to contact the EPA Project Officer on behalf of a subrecipient or to be involved in the negotiation of an Interconnection Service Agreement between the subrecipient and the EPA. D. Procurement Procedures As provided in 2 CFR 200.317, with limited exceptions, states and Indian Tribes must follow the same policies and procedures they follow for procurements financed with non-Federal funds. If such policies and procedures do not exist, States and Indian Tribes must follow the procurement standards in §§ 200.318 through 200.327. In addition to its own policies and procedures, a State or Indian Tribe must also comply with the following procurement standards: §§ 200.321, 200.322, 200.323, and 200.327. All other recipients and subrecipients, including subrecipients of a State or Indian Tribe, must follow the procurement standards in §§ 200.318 through 200.327. Page 52 of 373 5Y - 02J92401 - 0 Page 9 The recipient must follow applicable procurement procedures. The EPA will not be a party to these transactions. If EPA funds will be used to purchase goods or services, recipient agrees to compete the contracts for those goods and services and conduct cost and price analyses to the extent required by the fair and open competition for procurement provisions of 2 CFR 200.318 through 2 CFR 200.327. Approval of a funding application does not relieve recipients of their obligations to compete service contracts and conduct cost and price analyses. E. Project Transparency The recipient agrees to engage with near-port communities about the project during the performance period and provide documentation that a detailed written summary of the results of the project (e.g., emissions inventory, emissions reduction targets or other planning activities) have been made available to the public, such as via a webpage, for all activities included in the final workplan. Examples of appropriate community engagement during the project period are outlined on pg. 34 of the Notice of Funding Opportunity. Community engagement activities conducted as part of the final approved workplan should be reported in performance reporting described in Programmatic Term and Condition B (Performance Reporting and Final Performance Report). F. Program Audit In addition to audit requirements listed in the EPA General Terms and Conditions which relate to audits and access to records, the recipient agrees to comply with random EPA reviews of the recipient to protect against waste, fraud, and abuse. As part of this process, the EPA, or its authorized representatives, may request copies of grant documents from prior recipients who have received grants, or may request documentation from current recipients and subrecipients, to verify statements made on the application and reporting documents. Recipients may be selected for advanced monitoring, including a potential site visit to confirm project details. Recipients are expected to comply with site visit requests and recordkeeping requirements and must supply the EPA with any requested documents for as long as the records are retained, or risk cancellation of an active grant application or other enforcement action. G. Record Retention As required by 2 CFR 200.334-338, the recipient must keep all financial records, supporting documents, accounting books and other evidence of Grant Program activities for three years from the date of submission of the final financial report. If any litigation, claim, or audit is started before the expiration of the three-year period, the recipient must maintain all appropriate records until these actions are completed and all issues resolved. H. Public or Media Events The recipient agrees to notify the EPA Project Officer listed in this award document of public or media events publicizing the accomplishment of significant events related to construction projects as a result of this agreement and provide the opportunity for attendance and participation by federal representatives with at least ten (10) working days' notice. I. Emissions Inventories Emissions inventories must follow the EPA's Port Emissions Inventory Guidance. This guidance may be found at: https://www.epa.gov/ports-initiative/port-and-goods-movement-emission-inventories. Page 53 of 373 5Y - 02J92401 - 0 Page 10 J. Quality Assurance Authority: Quality Assurance applies to all assistance agreements involving environmentally related data operations, including environmental data collection, production, or use as defined in 2 CFR. 1500.12 Quality Assurance. The recipient shall ensure that subawards involving environmental information that are issued under this agreement include appropriate quality requirements for the work. The recipient shall ensure sub-award recipients develop and implement a Quality Assurance (QA) planning document[s] in accordance with this term and condition; and/or ensure sub-award recipients implement all applicable approved QA planning documents. 1. Quality Management Plan (QMP) a. Prior to beginning environmental information operations, the recipient must: i. Develop a QMP. This requirement can also be satisfied by integrating QMP elements into the QAPP developed under subsection 2. ii. Prepare the QMP in accordance with the current version of EPA's Quality Management Plan (QMP) Standard. Submit the document for EPA review, and iii. Obtain EPA Quality Assurance Manager or designee (hereafter referred to as QAM) approval. b. The recipient must submit the QMP 30 days before beginning environmental information operations and no more than 180 days after grant award. c. The recipient must review their approved QMP at least annually. These documented reviews shall be made available to the sponsoring EPA organization if requested. When necessary, the recipient shall revise its QMP to incorporate minor changes and notify the EPA PO and QAM of the changes. If significant changes have been made to the Quality Program that affect the performance of environmental information operations, it may be necessary to re-submit the entire QMP for re-approval. In general, a copy of any QMP revision(s) made during the year should be submitted to the EPA PO and QAM in writing when such changes occur. Conditions requiring the revision and resubmittal of an approved QMP can be found in section 6 of EPA's Quality Management Plan (QMP) Standard. 2. Quality Assurance Project Plan (QAPP) a. Prior to beginning environmental information operations, the recipient must: i. Develop a QAPP, ii. Prepare QAPP in accordance with the current version of EPA's Quality Assurance Project Plan (QAPP) Standard, iii. Submit the document for EPA review, and iv. Obtain EPA Quality Assurance Manager or designee (hereafter referred to as QAM) approval. Page 54 of 373 5Y - 02J92401 - 0 Page 11 b. The recipient must submit the QAPP 30 days before beginning environmental information operations and no more than 180 days after grant award. c. The recipient shall notify the PO and QAM when substantive changes are needed to the QAPP. EPA may require the QAPP be updated and re-submitted for approval. d. The recipient must review their approved QAPP at least annually. The results of the QAPP review and any revisions must be submitted to the PO and the QAM at least annually and may also be submitted when changes occur. For Reference: • Quality Management Plan (QMP) Standard and EPA's Quality Assurance Project Plan (QAPP) Standard; contain quality specifications for the EPA and non-EPA organizations and definitions applicable to these terms and conditions. • EPA QA/G-5: Guidance for Quality Assurance Project Plans: https://www.epa. gov/sites/default/files/2015-06/documents/g5-final.pdf • The EPA's Quality Program website has a list of QA managers, and specifications for EPA and NonEPA Organizations. • The Office of Grants and Debarment Implementation of Quality Assurance Requirements for Organizations Receiving EPA Financial Assistance. K. Use of Logos If the EPA logo is appearing along with logos from other participating entities on websites, outreach materials, or reports, the EPA logo must not be prominently displayed in a way that may imply that any of the recipient or subrecipient's activities are being conducted by the EPA. Instead, the EPA logo should be accompanied with a statement indicating that the Port of Seattle received financial support from the EPA under an Assistance Agreement. More information is available at: https://www.epa. gov/stylebook/using-epa-seal-and-logo#policy L. Automated Standard Application Payments (ASAP) and Proper Payment Draw Down The recipient is subject to the Automated Standard Application Payments (ASAP) and Proper Payment Draw Down General Term and Condition. See the "Financial Information" section of the General Terms and Conditions. The recipient is required to notify the EPA Project Officer of draws from ASAP in excess of 50% of the award within a 24-hour period. The recipient is required to provide such notification within 3 business days of the draw amount being surpassed. The recipient is subject to the Management Fees General Term and Condition, which includes the following requirements that prohibit profit on the part of the grantee: 1. Management fees or similar charges in excess of the direct costs and approved indirect rates are not allowable. Page 55 of 373 5Y - 02J92401 - 0 Page 12 2. Management fees or similar charges may not be used to improve or expand the project funded under this agreement, except to the extent authorized as a direct cost of carrying out the scope of work. See the "Selected Items of Cost" section of the General Terms and Conditions. M. Ineligible Project Costs The recipient must not include the following activities or costs in the project: 1. Activities that are not focused on one or more ports. For purposes of this assistance program, a port is either a water port or a dry port, as defined below: a. Water port: places on land alongside navigable water (e.g., oceans, rivers, or lakes) with one or more facilities in close proximity for the loading and unloading of passengers or cargo from ships, ferries, and other commercial vessels. This includes facilities that support non-commercial Tribal fishing operations. b. Dry port: an intermodal truck-rail facility that is included in the 2024 Federal Highway Administration's (FHWA) Intermodal Connector Database based on meeting the criteria set in 23 CFR 470. These criteria include having more than 50,000 TEUs (20-foot equivalent units) per year or other units measured that would convert to more than 100 trucks per day, or comprising more than 20 percent of freight volumes handled by any mode within a State. 2. Planning exercises related to emissions or emissions reductions where vehicles, vessels, and other mobile source port equipment are not included. 3. Development of an EJ mapping tool (applicants should instead rely on existing tools) Revised April 10, 2024 4. Vulnerability assessments not related to impacts from extreme weather and other climate-related events and conditions 5. Resiliency measure implementation (construction, equipment, purchase, information systems, etc.) 6. Emissions reduction strategy implementation (e.g., the purchase of ZE mobile source equipment, which is eligible for funding under Funding Opportunity Number EPA-R-OAR-CPP-24-04). 7. As proscribed in Section 825 of the National Defense Authorization Act, the EPA may not award funds to an entity that uses in part or in whole: the national transportation logistics public information platform (commonly referred to as 'LOGINK'); any national transportation logistics information platform provided by or sponsored by the People's Republic of China, or a controlled commercial entity; or a similar system provided by Chinese state-affiliated entities. N. Program Income In accordance with 2 CFR Part 200.307 and 2 CFR 1500.8(b), the recipient is hereby authorized to retain program income earned during the project period. The program income shall be used in one of the following ways: Page 56 of 373 5Y - 02J92401 - 0 Page 13 Option 1. Added to funds committed to the project by the EPA and used for the purposes and under the conditions of the assistance agreement. O. Competency Policy Competency of Organizations Generating Environmental Measurement Data In accordance with Agency Policy Directive Number FEM-2012-02, Policy to Assure the Competency of Organizations Generating Environmental Measurement Data under Agency-Funded Assistance Agreements, Recipient agrees, by entering into this agreement, that it has demonstrated competency prior to award, or alternatively, where a pre-award demonstration of competency is not practicable, Recipient agrees to demonstrate competency prior to carrying out any activities under the award involving the generation or use of environmental data. Recipient shall maintain competency for the duration of the project period of this agreement and this will be documented during the annual reporting process. A copy of this policy is available online at https://www.epa.gov/sites/production/files/2015-03/documents/competency-policyaaia-new.pdf or a copy may also be requested by contacting the EPA Project Officer for this award. P. Geospatial Data Standards All geospatial data created must be consistent with Federal Geographic Data Committee (FGDC) endorsed standards. Information on these standards may be found at https://www.fgdc.gov/. Q. Subawards to For-Profit Entities 1. In addition to the EPA General Term and Condition "Establishing and Managing Subawards", the recipient (i.e. "pass-through entity") agrees to require that for-profit subrecipients comply with Subparts A through F of the Uniform Grant Guidance (2 CFR Part 200) and the Federal cost principles applicable to for-profit entities located at 48 CFR Part 31, with the exception of the method of payment to for-profit subrecipients must be "reimbursement" rather than "advance". Pass-through entities must obtain documentation that the for-profit subrecipient has incurred eligible and allowable costs prior to releasing EPA funds to the subrecipient. 2. The recipient is authorized to provide subawards to for-profit entities as included in the EPA-approved Workplan. The recipient agrees to require that for-profit entities that receive such subawards: a. Can only recover their eligible and allowable direct and indirect costs from EPA-funded activities, including recovering the portion of their overhead costs attributable to the activities by applying either a Federally approved indirect cost rate, as authorized by 2 CFR 200.414(f), or the de-minimis rate if the subrecipient does not have a Federally approved rate; b. Comply with the Management Fees General Term and Condition, which is incorporated by reference into the Establishing and Managing Subawards General Term and Condition; c. Account for and use program income under the rules for program income pursuant to 2 C.F.R. § 300.307 and 2 CFR § 1500.8(b) and the terms and conditions of the award agreement; d. Be subject to the same requirements as non-profit subrecipients under 2 CFR Part 200 Subparts A Page 57 of 373 5Y - 02J92401 - 0 Page 14 through E; and e. Select an independent auditor consistent with the criteria set forth in 2 CFR 200.509 and obtain an independent audit substantially similar in scope and quality to that of the Single Audit (see 2 CFR 200.500 et. seq.); the subrecipient must submit the audit to the recipient within 9 months of the end of the recipient's fiscal year or 30 days after receiving the report from an independent auditor, whichever is earlier; as provided in 2 CFR 200.337(a) the recipient must provide EPA, the EPA Office of Inspector General, and the Comptroller General with access to the subrecipient's independent auditor reports. R. Participant Support Costs/Rebates Participant support costs include rebates, subsidies, stipends, or other payments to program beneficiaries. Program beneficiaries cannot be a contractor, subrecipient, or employee of recipient. Participant support costs are not subawards as defined by 2 CFR §200.1 and should not be treated as such. Participant support costs must be reasonable, incurred within the project period and otherwise allocable to the EPA assistance agreement. - Recipient must abide by EPA Participant Support Cost regulation(s) and guidelines including but not limited to Interim EPA Guidance on Participant Support Costs: https://www.epa.gov/grants/rain-2018g05-r1 - Recipient must maintain source documentation regarding program support funds to ensure proper accounting of EPA funds. - Recipient must enter into a written agreement with the program beneficiary that receives participant support costs. Such agreement should not be structured as a subaward agreement, and the administrative grant regulations under 2 CFR Part 200 and 2 CFR Part 1500, as well as EPA's general terms and conditions do not flow down to program beneficiaries receiving participant support costs. Such written agreement is also required if a subrecipient or contractor intends to issue participant support costs to a program beneficiary. The written agreement must: Describe the activities that will be supported by rebates, stipends, subsidies or other payments; specify the amount of the rebate, subsidy, stipend, or other payment; identify which party will have title to equipment (if any) purchased with a rebate or subsidy or other payment; and specify any reporting required by the program beneficiary and the length of time for such reporting. - Recipient must obtain the prior written approval from EPA's Award Official if it wants to provide participant support costs that were not described in the approved workplan and budget. If the recipient's request would result in undermining the integrity of the competition this grant or cooperative agreement was awarded under, EPA will not approve the request. - Recipient must obtain prior written approval from EPA's Award Official if recipient wants to modify the amount approved (upwards or downwards) for participant support costs. If the recipient's request would result in undermining the integrity of the competition this grant or cooperative agreement was awarded under, EPA will not approve the request. END OF DOCUMENT Page 58 of 373 Item No. 8f Attach-2 Meeting Date: April 22, 2025 Port of Seattle Clean Ports Planning Grant: Powering the Maritime Transition in the Pacific Northwest Scope of Work The Port of Seattle (POS), Northwest Seaport Alliance (NWSA), and Port of Tacoma (POT), collectively the Ports, have committed to phase out emissions from seaport-related activities by 2050. Oceangoing vessels (OGV) and harbor vessels (HVs) are the two largest sources of maritime-related air pollution and greenhouse gas (GHG) emissions in the Puget Sound region. These sectors are also the hardest to decarbonize and will require new technologies and fuels. This project will help catalyze the transition to sustainably powered and modernized vessels and prepare the region, maritime industry, communities, ports, and workforce for the transition to zero emissions (ZE). Through the completion of a Vessel Activity and Maritime Fuel Inventory, Harbor Vessel Modernization Feasibility Study, a Sustainable Maritime Fuels Transition Analysis, and extensive engagement with industry and near-port communities, this proposal aims to accelerate the transition to a ZE maritime industry, reduce impacts to communities, and provide replicable models for vessel modernization that can be used across the nation. The projects tasks include: • • • • Part 1: Project Management Plan and Governance Part 2: Vessel Activity and Maritime Fuel Inventory o Characterize Harbor Vessels and Ocean-Going Vessels calling SeattleTacoma ports o Analyze Harbor Vessels tra ic to develop a heat map of Harbor Vessels activity o Analyze maritime fueling, location, and supply chain data for Ocean-Going Vessels o Characterize fueling activity and well-to-wake GHG emissions of OceanGoing Vessels fuel consumption Part 3: Harbor Vessel Modernization Feasibility Study o Task 3.1: Technology Assessment o Task 3.2: Electrification Site Prioritization o Task 3.3: Strategy Development and Tradeo Analysis Part 4: Sustainable Maritime Fuels Transition Analysis o Task 4.1: Fuel Infrastructure Investment and Supply Acquisition Strategy  Fuel Demand Analysis  Fuel Storage and Bunkering Infrastructure Investment Analysis  Fuel Supply Acquisition Strategy o Task 4.2: Methanol Bunkering Feasibility Study & Desktop Exercise o Task 4.3: Maritime Fuels Transition Roadmap Assessment Page 59 of 373 • Part 5: Stakeholder Collaboration and Communication o Task 5.1: Community Engagement o Task 5.2: Industry Engagement o Task 5.3: Workforce Development Impacts Study Preliminary Schedule The project is expected to take approximately three years to complete, with funds expended per EPA grant requirements by 12/31/2027. Activity Q1 2025 Q2 Q3 Q4 Q1 2026 Q2 Q3 Q4 Q1 2027 Q2 Q3 Q4 Project Kick-off Project Management-Governance Vessel Activity and Fuel Inventory Harbor Vessel Feasibility Study Fuel Infrastructure Analysis Supply Acquisition Strategy Methanol Bunkering Exercise Fuels Transition Roadmap Community Engagement Industry Engagement Workforce Impacts Study Project Complete Page 60 of 373 Item No. 8f supp Meeting Date: April 22, 2025 EPA Clean Ports Program Planning Grant Use of Funds Sarah Ogier, Director-Maritime Environment & Sustainability David Fujimoto, Sr. Environmental Program ManagerMaritime Environment & Sustainability Page 61 of 373 Request The Maritime Environment and Sustainability Department is requesting authorization for use of the balance of funds awarded to the Port under the Environmental Protection Agency's (EPA) Clean Ports Program - Planning Grants. Request Commission authorization for the Executive Director to: 1. Expend up to $1,937,248 in grant funds 2. Execute related service agreements to achieve the results of the EPA Clean Ports Program Climate and Air Quality Planning Grant 2 Page 62 of 373 EPA Clean Ports Grant • Climate and Air Quality Planning Competition • Port was awarded full funding request • $2,997,248 over 3-year period, no match required • Project will help prepare for future fuels and technologies • Collaboration of the Port of Seattle (lead agency) with NWSA and Port of Tacoma • Port commitment to project with EPA award in December 2024 3 Page 63 of 373 Grant: Powering the Maritime Transition in the PNW Planning Activities & Study Partners 1. Vessel Activity & Maritime Fuel Inventory 2. Harbor Vessel Modernization Feasibility Study 3. Sustainable Maritime Fuels Transition • Demand Forecast • Infrastructure Investment Analysis • Supply Acquisition Strategy • Methanol Bunkering Desktop Exercise 4. Industry & Community Engagement 5. Workforce Development Analysis 4 Page 64 of 373 Climate and Air Planning Grant Authorization History Item Amount Description Application $1,060,000 Competition waiver, authorization to name designated subrecipients and enter into agreements with Washington Maritime Blue, American Bureau of Shipping (ABS), and RMI subject to grant award Additional Grant Authorization $1,937,248 Budget authorization for the balance of funds and authorization to execute related service agreements Total $2,997,248 Total 3-year grant award: $2,997,248 (May 21, 2024) (this request) 5 Page 65 of 373 Managing Risk in Uncertain Environment • All project subrecipients have confirmed interest in moving forward in current funding environment • Continue with grant commitments to EPA as written under the grant award • Close monitoring of funding availability and increased grant reimbursement cadence • Clear, ongoing communication with grant subrecipients • Contractual conditions specifying contingent funding, increased monitoring and reporting frequencies, and contractor risk evaluations 6 Page 66 of 373 Request Request Commission authorization for the Executive Director to: 1. Expend up to $1,937,248 in grant funds 2. Execute related service agreements to achieve the results of the EPA Clean Ports Program Climate and Air Quality Planning Grant 7 Page 67 of 373 1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 44 45 Agenda Item: 8g_Order Meeting Date: April 22, 2025 ORDER NO. 2025-06 AN ORDER OF THE PORT OF SEATTLE COMMISSION ... Appointing Members to the Port of Seattle Commission Board of Ethics. PROPOSED APRIL 22, 2025 INTRODUCTION The Port Commission, in May 2022, went through an extensive public recruitment process to interview prospective candidates for the Board of Ethics. At that time, William Barrett and Josh Friedmann were appointed to the Board. Both Members have extensive background and experience in law and ethics and have proven to be invaluable assets to the Board and to the Commission during their first terms. Both Members have expressed their desire to serve an additional term. TEXT OF THE ORDER The Port Commission, in accordance with Resolution No. 3833, the Port of Seattle Code of Ethics for Port Commissioners, hereby re-appoints William Barrett and Josh Friedmann to serve threeyear terms as members on the Commission Board of Ethics effective May 1, 2025, and ending April 30, 2028. STATEMENT IN SUPPORT OF THE ORDER The Port of Seattle has established a strong and comprehensive ethics program for Port Commissioners to foster high ethical standards, strengthen public trust and confidence in the Port of Seattle, and promote good governance. To further these goals, the Port of Seattle Commission adopted Resolution No. 3833, a revised Code of Ethics for Port Commissioners, in January 2025, incorporating provisions to further strengthen ethics requirements for the Commission. The Code of Ethics for Port Commissioners provides for the appointment of an Ethics Board composed of three members by majority vote of the Commission "to ensure proper and consistent implementation" of the Code. The Board serves as the formal mechanism to consider all complaints against Port Commissioners and acts as an advisory body to provide guidance on ethical matters to the Port Commission or individual Commissioners upon request. Both Mr. Barrett and Mr. Friedmann possess strong understanding, skills, and experience in the subjects of governance and professional administrative ethics and will serve the Commission well in its adherence to and guidance of the Code of Ethics. Order 2025-06 - Appointment to the Board of Ethics Page 1 of 1 Page 68 of 373 ITEM NO. 10a attach 1 DATE OF MEETING April 22, 2025 THE INDUSTRIAL DEVELOPMENT CORPORATION OF THE PORT OF SEATTLE NOTICE OF A SPECIAL MEETING A Special Meeting of the Industrial Development Corporation of the Port of Seattle will be held on Tuesday, April 22, 2025, in the Conference Center at Seattle-Tacoma International Airport, during a recess of the Port of Seattle Commission Regular Meeting, which convenes at 12:00 p.m. The Agenda includes: 1. Approval of the proposed minutes of the Industrial Development Corporation of the Port of Seattle Special Meeting of March 26, 2024. 2. Approval of the Industrial Development Corporation of the Port of Seattle Board of Directors and Officers for 2025. 3. Review, as needed, of the Annual Report for the Industrial Development Corporation for year ending December 31, 2024. 4. Attachment for reference: Overview of the Industrial Development Corporation and Frequently Asked Questions (FAQs). Adjournment of the Annual Meeting of the Industrial Development Corporation of the Port of Seattle. Page 1 of 17 Page 69 of 373 INDUSTRIAL DEVELOPMENT CORPORATION AGENDA Item No. Date of Meeting 1 April 22, 2025 DATE: April 4, 2025 TO: Stephen P. Metruck, Executive Director FROM: Ian Burke, Senior Financial Analyst - Corporate Finance & Budget Scott Bertram, Manager - Corporate Finance & Budget SUBJECT: Approval of the Proposed Minutes of the Industrial Development Corporation of the Port of Seattle Meeting of March 26, 2024 ACTION REQUESTED: Request Board approval of the proposed minutes of the Industrial Development Corporation of the Port of Seattle meeting of March 26, 2024. Draft minutes have been circulated to the Board of Directors and approved minutes will be posted to the Port's website. Page 2 of 17 Page 70 of 373 INDUSTRIAL DEVELOPMENT CORPORATION AGENDA Item No. Date of Meeting 2 April 22, 2025 DATE: April 4, 2025 TO: Stephen P. Metruck, Executive Director FROM: Ian Burke, Senior Financial Analyst - Corporate Finance & Budget Scott Bertram, Manager - Corporate Finance & Budget SUBJECT: Election of Officers REQUESTED ACTION: Request Board approval of the Industrial Development Corporation of the Port of Seattle Board of Directors and Officers for 2025. BACKGROUND: In accordance with the Bylaws for the Industrial Development Corporation of the Port of Seattle, the following is a list of the Board of Directors and Officers for the Corporation: Toshiko Grace Hasegawa, President Ryan Calkins, Vice President Sam Cho, Secretary Hamdi Mohamed, Director Fred Felleman, Director IDC Bylaws - Article 5, Section A. Number and Qualifications. "The officers of the Corporation shall be the same as the officers of the Port Commission and such other officers as may be determined by the Board of Directors from time to time to perform such duties as may be designated by the Board of Directors." Page 3 of 17 Page 71 of 373 INDUSTRIAL DEVELOPMENT CORPORATION AGENDA Item No. Date of Meeting 3 April 22, 2025 DATE: April 4, 2025 TO: Stephen P. Metruck, Executive Director FROM: Ian Burke, Senior Financial Analyst - Corporate Finance & Budget Scott Bertram, Manager - Corporate Finance & Budget SUBJECT: Industrial Development Corporation Annual Report for 2024 SYNOPSIS: The Industrial Development Corporation (the "IDC") of the Port of Seattle was established in 1982 pursuant to Revised Code of Washington (Chap. 39.84). The IDC is a special purpose government with limited powers and was established for the purpose of facilitating industrial expansion through tax-exempt financing by providing companies with access to the tax-exempt credit market through the facilities of the IDC. See Appendix A for a link to the complete IDC Revenue Bond RCW. Any company with a project that qualifies for tax-exempt financing and qualifies under both RCW 39.84 and IDC policy may apply for IDC financing. Appendix B details IDC policy as outlined by Resolution No. 2. The Port is not the lender and cannot lend credit or give money to the IDC. Debt issued by a company through the IDC is the sole responsibility of the company and is always non-recourse to the Port and to the IDC. Bond proceeds go directly to the company borrowing through the IDC. The companies pay their debt service (principal and interest) to a trustee. Any city, county or port in Washington State may establish an IDC, and a number of other jurisdictions have done so, including King and Pierce Counties; the cities of Seattle, Everett, Bellingham and Kent; and several other ports including the Ports of Bellingham and Anacortes. Appendix C. of Item No. 4, FAQs provides a more comprehensive list. The majority of projects financed through the Port's IDC occurred between 1982 and 1986. Activity has since declined, primarily due to the Tax Reform Act of 1986 (the "Act"), which made a number of changes to the tax-exempt financing code that ultimately limited the benefits of an IDC financing for both issuers and investors. For issuers, the Act reduced the number of qualifying projects by narrowing the definition of types of projects and eliminated certain depreciation tax advantages. The tax code change also reduced the pool of investors (e.g., banks, who were the majority investor) in this market segment by making their effective rate for holding tax-exempt private activity bonds closer to a taxable rate. Item No. 4, FAQs provides more details. The IDC is governed by a board of directors comprised of the members of the Port Commission; accordingly, both the IDC Board and the Port Commission must approve any IDC bond issue. The IDC Board meets at a minimum once a year during a Commission meeting to elect new officers and review the IDC's annual financial results. Page 4 of 17 Page 72 of 373 ANNUAL REPORT SUMMARY: Attached are the financial statements of the IDC. The IDC had assets totaling $324,748 at year-end 2024, which consists primarily of existing cash & cash equivalents. The IDC had total revenues of $12,399, generated from interest earnings. STATUS OF IDC BONDS: As of December 31, 2024, there was one company with outstanding IDC debt totaling $66,025,000, as shown in the table below. Company Delta Air Lines, Inc. (1) TOTAL Outstanding Debt 66,025,000 $ 66,025,000 Maturity 2030 (1) Previously Northwest Airlines Corp. (NWA). NWA merged with Delta Air Lines, Inc. (Delta) in 2008. NWA bonds refunded with Delta bonds, October 2012. MANAGEMENT DISCUSSION: The IDC has collected customer fees based on a percentage of annual debt service. The fees can be paid annually or via a one-time lump-sum payment at the time the company issues bonds. Delta made a one-time lump-sum payment (calculated using the present value of debt service over the life of the bonds) in 2012 when they refunded the Northwest Airlines bonds. As such, the IDC will no longer collect customer fees going forward unless there is a new issuance. IDC funds are invested in the Port's investment pool and the allocated interest income to the IDC in 2024 was $12,399. The investment income for 2025 is projected to be approximately $11,400. The IDC incurred expenses of $221 in 2024 which consisted of Port's staff administrative time. The IDC's charter permits its funds to be transferred only to the Port. Under an amendment to RCW 39.84.130, IDC funds that are not otherwise encumbered for the payment of revenue bonds and are not anticipated to be necessary for administrative expenses of the IDC may be transferred to the Port to be used for growth management, planning or other economic development purposes. In order to transfer funds, the Board of Directors of the IDC needs to adopt a resolution authorizing the transfer. Any transfer of funds would reduce the assets of the IDC and the interest earnings on these assets. No such transfer was requested nor made in 2024. All IDC funds will be transferred to the Port on dissolution, which can occur upon final redemption of all outstanding IDC bonds, currently scheduled in 2030. MINIMUM FUND BALANCE RECOMMENDATION: Staff recommends that the IDC maintain the current balance of $324,748 to ensure adequate investment earnings to fund annual operating and future audit expenses since there are no additional sources of funds. Higher interest rates have allowed for higher investment income earnings for the last couple of years. This has resulted in a slightly higher fund balance than is likely necessary to cover costs over the life of the IDC (assuming dissolution in the near future) but Staff does not recommend risking a shortfall later for the sake of Page 5 of 17 Page 73 of 373 a small amount of likely excess cash now. Continued high interest rates could result in Staff being able to recommend a lower fund balance in future years. INDUSTRIAL DEVELOPMENT CORPORATION OF THE PORT OF SEATTLE BALANCE SHEET For The Years Ended December 31 2024, 2023 & 2022 December 31, 2024 December 31, 2023 December 31, 2022 ASSETS Cash and Cash Equivalents $ 324,748 $ 312,571 $ 306,259 TOTAL ASSETS $ 324,748 $ 312,571 $ 306,259 LIABILITIES AND EQUITY Equity $ 324,748 $ 312,571 $ 306,259 TOTAL LIABILITIES & EQUITY $ 324,748 $ 312,571 $ 306,259 Page 6 of 17 Page 74 of 373 INDUSTRIAL DEVELOPMENT CORPORATION OF THE PORT OF SEATTLE INCOME STATEMENT AND CHANGES IN EQUITY For The Years Ended December 31 2024, 2023 & 2022 December 31, 2024 INCOME Investment Income December 31, 2023 December 31, 2022 $ 12,399 $ 10,519 $ 5,071 EXPENSE Administrative Expense Other Expense - State Audit $ 221 $ - 3,221 $ 986 2,272 - NET INCOME $ 12,177 6,312 $ 2,799 BEG. EQUITY ENDING EQUITY $ $ 312,571 $ 324,748 $ 306,259 $ 312,571 $ 303,460 306,259 $ Page 7 of 17 Page 75 of 373 INDUSTRIAL DEVELOPMENT CORPORATION OF THE PORT OF SEATTLE STATEMENT OF CASH FLOWS For The Years Ended December 31 2024, 2023 & 2022 December 31, 2024 CASH FLOWS FROM OPERATING ACTIVITIES: Cash received from bond issuers Cash paid for expenses Net cash provided by operating activities December 31, 2023 December 31, 2022 $ - $ (221) - $ (4,207) 17,417 (2,272) $ (221) $ (4,207) $ 15,145 $ 12,399 $ 10,519 $ 5,071 $ 12,399 $ 10,519 $ 5,071 NET INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS $ 12,177 $ 6,312 $ 20,216 CASH AND CASH EQUIVALENTS Beginning of year $ 312,571 $ 324,748 $ CASH FLOWS FROM INVESTING ACTIVITIES: Interest on investments Net cash provided by investing activities End of year $ 306,259 $ 286,043 312,571 $ 306,259 Page 8 of 17 Page 76 of 373 INDUSTRIAL DEVELOPMENT CORPORATION AGENDA Item No. Date of Meeting 4 April 22, 2025 DATE: April 4, 2025 TO: Stephen P. Metruck, Executive Director FROM: Ian Burke, Senior Financial Analyst - Corporate Finance & Budget Scott Bertram, Manager - Corporate Finance & Budget SUBJECT: Overview of the Industrial Development Corporation Frequently Asked Questions (FAQs). What is the purpose of an IDC?  To facilitate industrial expansion through use of tax-exempt financing made available to companies for qualified projects. What does the term "tax-exempt financing" mean?  It means bondholders (investors) who purchase the bonds do not pay federal income tax on the interest received on such bonds, as they normally would do on interest-bearing bonds. How does tax-exempt financing help the institution that is funding capital projects?  Because investors pay no income taxes on interest income, they are generally willing to accept a lower interest rate than if the bonds were issued on a taxable basis. Thus, tax-exempt bonds provide the ability to finance many public infrastructure capital projects at a reduced cost. What changed in the tax law to make tax exempt financing through the IDC less attractive now than it was when these projects were financed? There are several factors that have adversely affected the use of tax exempt financing over the years.  When our state initially authorized the use of nonrecourse tax-exempt financing, federal tax rules permitted the financing of a very broad spectrum of projects, including wholesale and retail facilities as well as warehouse facilities (of which there were many in Washington State due to the large agricultural base). There was almost no limit on the types of facilities that could be financed. As a result, taxexempt financing was an option for many capital expansion projects. At that time, interest rates were also very high (substantially higher than the current interest rate environment), which made tax-exempt financing especially attractive. The Tax Reform Act of 1986 made a number of changes in the tax-exempt financing code sections that adversely affected the use of tax-exempt bonds for business expansion. The tax rules imposed substantial limitations on the types of facilities that may be financed with tax-exempt bonds. These limitations eliminated at least 50-60% of the facilities that had been financed pre-1986. The 1986 Tax Reform Act also removed the deductibility of interest earned on tax-exempt securities purchased by commercial banks subsequent to August 7, 1986. This effectively created a tax-on-tax-exempt Page 9 of 17 Page 77 of 373 interest for such banks, which prior to 1986 were the largest investors in tax-exempt bonds. The net result was the demand by commercial banks for tax-exempt securities was almost entirely eliminated.  Users of tax-exempt bond financing were also restricted in their depreciation methodology for taxexempt bond financed property. Interest on private activity bonds also is subject to alternative minimum taxes. The US Treasury proposed the enactment of these rules in order to minimize the availability of this financing tool. Who can establish an IDC?  Any city, county or port in the State of Washington can establish an IDC. When and how was the Port's IDC formed?  The Port's IDC was established on February 9, 1982, pursuant to RCW 39.84. What is the boundary of the Port's IDC?  King County - as defined, it is the "Corporate boundaries of the Port". The IDC may finance projects within King County. What is the Port's IDC's structure?  It is a special purpose government with limited powers.  It is governed by a board of directors who are the same as the members of the Port Commission.  The Port cannot lend credit or give money to IDC.  Debt is always non-recourse to the Port and to the IDC. What law(s) and policies govern the IDC and what projects might be eligible for Port IDC funding?  Washington State law RCW 39.84, which is the statute that covers all IDC-related issues.  Federal law (IRS tax code), which covers tax-exempt financing eligibility.  A project must qualify under both Washington State and Federal law to be eligible for Port IDC financing. o In the current legal environment, the biggest limitation surrounding Port IDC stems from the 1986 Tax Reform Act, which as mentioned above significantly narrowed the type of projects that can be financed with tax-exempt bonds and the type of borrowers who can avail themselves of tax-exempt bonds. o Based on the current legal environment, legal counsel & staff have determined that only certain types of projects that may qualify for Port IDC financing:   Airport facilities and over water shipping/receiving facilities, including related facilities  Solid waste and/or sewage treatment and disposal  Processing and manufacturing (with a maximum bond size of $10,000,000) Additionally, IDC uses are limited by Resolutions on policy adopted by the IDC board. The policy is subject to change with approval from the IDC board. Page 10 of 17 Page 78 of 373 What does that resolution stipulate for eligibility of projects?  The Commission has adopted a policy for judging eligibility of projects:  The IDC will consider only projects or proposals which will further the purposes and objectives of the Port of Seattle within the confines of state and federal law.  Tax exempt private activity bonds will be issued only for the financing of projects which broaden and strengthen the economic base of the Port District by enhancing trade and the movement of passengers and cargo by air or sea, including: o the development or improvement of marine terminals and airport facilities or components thereof; o the development and improvement of commercial and industrial land, manufacturing facilities, warehouses, terminal and transfer facilities, and related improvements which enhance trade via Port-owned or operated airport and marine facilities; o the development and improvement of facilities which will enhance or promote the Port's Comprehensive Scheme; and o the development and improvement of facilities which directly support and assist the movement of passengers and cargo by air or waterborne transportation, including, but not limited to, aircraft and ship construction and repair facilities, facilities necessary for the inspection, weighing, storage, and packaging of cargo; and connecting surface transportation facilities. Who assists the Port in deciding which projects to finance?  When bonds are issued, outside bond counsel is engaged to review and confirm legal compliance and eligibility of the project for tax-exempt financing. The bond counsel certifies that the issuer has the legal authority to issue the bonds and that the securities qualify for federal income exemption. Staff reviews projects based on Port policy. Ultimately, the IDC Board and Port Commission have to approve the use of the IDC for financing. Who may apply for financing through the IDC?  Any company with a project that qualifies for tax exempt financing and qualifies under RCW 39.84 (the RCW that covers all IDC issuances) and the IDC policy listed above may apply for IDC financing. How much can be spent on financing the project?  The amount of the bond issuance depends on the borrower's ability to repay as determined by investors; as non-recourse bonds, this is determined solely by the borrower's credit. Generally, all proceeds from the bond issuance are used for project spending with some exceptions. Under section 147(g) of the Federal Tax Code, any amount of bond proceeds that may be applied to finance the costs associated with the issuance of qualified private activity bonds (both before and after the issue date) is limited to 2% of the proceeds of the bond issue. As a general rule, qualified private activity bonds must satisfy a use test whereby 95% or more of the net proceeds of the bond issue must be used to finance the qualified purpose for which the bonds were issued. How does the IDC get compensated?  The IDC is compensated for administrative expenses related to the bonds by the borrower. The compensation is based on a percentage of the debt service. Payment is generally a lump-sum paid when bonds are issued; older bonds had the option of payments made annually through the life of the bond. How does the bond counsel get compensated? Page 11 of 17 Page 79 of 373  Bond counsel is paid a fee that is negotiated with the borrower. The fee may be fixed or hourly. A flat fee is generally based on the type and size of the bond issue. Fees are paid at the time of issuance, generally out of bond proceeds. Who are the current outstanding borrowers of IDC funds?  Delta Air: In 2001, the IDC issued bonds on behalf of Northwest Airlines for the construction of a twobay maintenance hangar and a cargo handling facility at SeaTac Airport. In September of 2012, the Commission gave approval for the bonds to be refinanced by Delta Airlines, which has acquired Northwest Airlines, so Delta Airlines is now the borrower. The facility is still in operation. This project is completed, but the bonds are still outstanding. Page 12 of 17 Page 80 of 373 IDC Frequently Asked Questions Appendix A Chapter 39.84 RCW INDUSTRIAL DEVELOPMENT REVENUE BONDS Chapter 39.84 RCW Industrial Development Revenue Bonds can be found in the Washington State Legislature web site, via the following hyperlink: http://apps.leg.wa.gov/rcw/default.aspx?cite=39.84. Page 13 of 17 Page 81 of 373 Appendix B RESOLUTION NO. 2 A RESOLUTION of the Industrial Development Corporation of the Port of Seattle adopting a master policy for the purpose of determining the eligibility of projects or proposals for financing. WHEREAS, the Industrial Development Corporation of the Port of Seattle (the "Corporation") is a public corporation created pursuant to Chapter 300, Laws of Washington 1981 (Reg. Sess.) codified as Chapter 39.84 of the Revised Code of Washington and Resolution No. 2845 adopted by the Port of Seattle Commission on February 9, 1982; and WHEREAS, the Corporation is now desirous of adopting a master policy to determine the eligibility of projects or proposals coming before the Corporation; and WHEREAS, the Corporation wishes to establish and empower a Chief Staff Officer for the Corporation with the authority to amend, update and revise, when necessary, the initial procedures to carry out the adopted policies herein; and WHEREAS, the initial procedures have been submitted to the Board of Directors of the Corporation and by adoption of this Resolution represents Board concurrence in the general context and form. NOW, THEREFORE, BE IT RESOLVED BY THE INDUSTRIAL DEVELOPMENT CORPORATION OF THE PORT OF SEATTLE, WASHINGTON, as follows: Section 1. It is the basic policy of the Corporation to comply with the applicable Federal and State of Washington laws and amendments thereto in determining the eligibility of any project or proposal coming before the Corporation for consideration and/or approval for financing. Section 2. The Corporation hereby adopts the following additional policy to determine the eligibility of projects or proposals for financing by the Corporation: A. The Corporation will consider only projects or proposals which will further the purposes and objectives of the Port of Seattle as adopted by the Port Commission December 9, 1980 or as further amended from time to time. B. Tax exempt industrial revenue bonds will be issued only for the financing of projects which broaden and strengthen the economic base of the Port District by enhancing trade and the movement of passengers and cargo by air or sea, including: (1) the development or improvement of marine terminals and airport facilities or components thereof; (2) the development and improvement of commercial and industrial land, manufacturing facilities, warehouses, terminal and transfer facilities, and related improvements which enhance trade via Portowned or operated airport and marine facilities; (3) the development and improvement of facilities which will enhance or promote the Port's Comprehensive Scheme; and (4) the development and improvement of facilities which directly support and assist the movement of passengers and cargo by air or waterborne transportation, including, but not limited to, aircraft and ship construction and repair facilities, facilities necessary for the inspection, weighing, storage, and packaging of cargo; and connecting surface transportation facilities. A. The Corporation will not consider projects or proposals that: (1) unnecessarily or unjustifiably subsidize users, i.e., proponents must demonstrate reasonable need for this form of financing; Page 14 of 17 Page 82 of 373 (2) create unfair competition or dislocate the balance of competition within the Port District; (3) duplicate existing facilities which already adequately meet current needs; (4) are proposed by others than the directly interested party, or by any proponent unable to demonstrate a sound operating and financial history; and (5) are not otherwise authorized by the 1981 Local Economic Development Act or other applicable laws. Section 3. The Chief Staff Officer of the Corporation shall be the Executive Director of the Port of Seattle. The chief staff officer is hereby authorized to carry out the purposes of the policies hereby and henceforth adopted by the Corporation and may amend, update and revise the procedures of this Resolution as it is from time to time necessary due to changes in law and/or operations of the Port without prior Commission approval, except as to fees and assessments to be charged. The initial procedures have been submitted to the Board of Directors of the Corporation and by this Resolution they concur in the general context and form. ADOPTED by the Board of Directors of the Industrial Development Corporation of the Port of Seattle, Washington this 27th day of April 1982. JACK BLOCK PRESIDENT ATTEST: HENRY L KOTKINS SECRETARY (SEAL) Page 15 of 17 Page 83 of 373 IDC Frequently Asked Questions Appendix C Examples of IDC/EDC's located in Washington State* Counties Adams County Chelan County King County Kitsap County Okanogan County Pierce County Spokane County Snohomish County Kittitas County Klickitat County Clark County Yakima County Cities Algona Anacortes Bellingham Enumclaw Everett Kent Seattle Snoqualmie Sunnyside Union Gap Vancouver Port Districts Port of Anacortes Port of Bellingham Port of Benton Port of Camas-Washougal Port of Centralia Port of Chehalis Port of Douglas County Port of Edmonds Port of Ephrata Port of Everett Port of Kalama Port of Longview Port of Moses Lake Port of Olympia Port of Pasco Port of Port Angeles Page 16 of 17 Page 84 of 373 Port of Port Townsend Port of Quincy Port of Seattle Port of Skagit Port of Skamania Port of Sunnyside Port of Walla Walla Port of Warden * This list may not represent all issuers; some have been inactive for many years. Page 17 of 17 Page 85 of 373 ITEM NO. DATE OF MEETING 10a April 22, 2025 P.O. Box 1209 Seattle, Washington 98111 www.portseattle.org 206.787.3000 MINUTES OF THE ANNUAL MEETING OF THE BOARD OF DIRECTORS OF THE INDUSTRIAL DEVELOPMENT CORPORATION OF THE PORT OF SEATTLE May 26, 2024 The annual meeting of the Board of Directors of the Industrial Development Corporation (IDC) of the Port of Seattle, Washington, was held on May 26, 2024, during a recess of the Port Commission regular meeting on the same date, which convened at 12:00 p.m. and was conducted at the Seattle-Tacoma International Airport Conference Center, located at 17801 International Blvd, Seattle WA, Mezzanine Level, and virtually on Microsoft Teams. The annual meeting of the Board of Directors of the IDC convened at 12:46 p.m., with Director Mohamed presiding. Directors present included Ryan Calkins, Sam Cho, Fred Felleman, Toshiko Hasegawa, and Hamdi Mohamed. 1. Approval of Minutes Minutes of the IDC meeting of March 28, 2023. Motion for approval of the IDC meeting minutes of March 28, 2023, carried by the following vote: In Favor: Calkins, Cho, Felleman, Hasegawa, and Mohamed (5) Opposed: (0) 2. Election of Board of Directors Officers ACTION REQUESTED: Request Board approval of the Industrial Development Corporation of the Port of Seattle Board of Directors and Officers for 2024. Request documents: IDC agenda memorandum. IDC Minutes of Month D, YYYY, submitted for review on Month D, YYYY, and proposed for approval on Month D, YYYY. Page 86 of 373 Port of Seattle Industrial Development Corporation Minutes of March 26, 2024 Page 2 of 3 Pursuant to the IDC Bylaws, Article 5, Section A, the following is a list of proposed Board of Directors and Officers for 2024: Hamdi Mohamed, President Toshiko Hasegawa, Vice-President Ryan Calkins, Secretary Sam Cho, Director Fred Felleman, Director Motion for approval of proposed slate of Directors/Officers carried by the following vote: In Favor: Calkins, Cho, Felleman, Hasegawa, and Mohamed (5) Opposed: (0) 3. Industrial Development Corporation Annual Report for 2023 Presentation documents: IDC agenda memorandum. Presenter(s): Ian Burke, Senior Financial Analyst Corporate, Finance and Budget. Mr. Burke presented the 2023 Annual Report, noting the following relevant information in the annual meeting packet:       The IDC was established in 1982 under Chapter 39.84 RCW as an incentive to industrial development in King County via access to tax-exempt financing. The Port's IDC is not the lender, but acts as a conduit. Debt issued through the IDC is the sole responsibility of the company issuing the debt and is non-recourse to the Port and the IDC. Narrow criteria to qualify for IDC financing means that only two projects have been funded through the IDC since 1982. Financial reports attached. Status of IDC bonds - as of December 31, 2023, one company, Delta Air Lines, Inc, had an outstanding IDC debt totaling $66,025,000. Delta made a one-time lump-sum payment (calculated using the present value of debt service over the life of the bonds) in 2012 when they refunded the Northwest Airlines bonds. As such, the IDC will no longer collect customer fees going forward unless there is a new issuance. Minimum fund balance recommendation - $312,000 to ensure adequate investment earnings to fund annual operating and future audit expenses. Minutes of April 1, 2014, IDC meeting proposed for approval on April 14, 2015. Page 87 of 373 Port of Seattle Industrial Development Corporation Minutes of March 26, 2024 4. Page 3 of 3 Adjournment There being no further business, the annual meeting of the Board of Directors of the Industrial Development Corporation of the Port of Seattle was adjourned at 12:53 p.m. Prepared: Attest: Michelle M. Hart, MMC, Commission Clerk Ryan Calkins, Industrial Corporation Secretary Development Minutes approved ____________, 2025. Minutes of April 1, 2014, IDC meeting proposed for approval on April 14, 2015. Page 88 of 373 COMMISSION AGENDA MEMORANDUM ACTION ITEM Item No. Date of Meeting 10b April 22, 2025 DATE: March 20, 2025 TO: Stephen P. Metruck, Executive Director FROM: Jeff Wolf, Director, Aviation Commercial Management Khalia Moore, Assistant Director, Aviation Commercial Management Scott Van Horn, Manager, Business Development & Assistant ACDBE Liaison SUBJECT: Lease and Concession Request for Proposal for Six Various Food and Beverage Locations and Fourteen Various Retail Locations (Specialty and Convenience) that will naturally expire between 2025 and 2028 at Seattle-Tacoma International Airport (SEA or Airport) ACTION REQUESTED Request Commission authorization for the Executive Director to (1) conduct the release of a Request for Proposal (RFP 25-1) and (2) execute a Lease and Concession Agreement with selected proposers for the twenty (20) Airport Dining and Retail (ADR) locations that will naturally expire between 2025 and 2028. EXECUTIVE SUMMARY This request is for existing ADR locations that were part of the original Lease Group 1, awarded in 2016, and will naturally expire between 2025 through 2028. Staff will utilize the same RFP process that reflect Commission's guidance used in past ADR program redevelopment Lease Groups. The continued redevelopment of the ADR program offers an excellent opportunity to advance the Port's Century Agenda goals by enhancing the Airport's profile as the preferred gateway to the Pacific Northwest by promoting job growth, creating new opportunities for small, local, and disadvantage businesses, and by meeting the expectations of the traveling public for quality food service, retail products, and personal services. The ADR program is an important element of the Port's ongoing efforts to provide outstanding customer service and improve the traveling experience. In addition, the businesses generate significant revenue that is reinvested to support airport operations and capital improvements at the Airport. Template revised January 10, 2019. Page 89 of 373 COMMISSION AGENDA - Action Item No. 10b Meeting Date: April 22, 2025 Page 2 of 4 JUSTIFICATION With the completion and build-out of the ADR Master Plan, these twenty (20) locations will naturally expire between calendar years 2025 and 2028, as outlined below: 2025 Expiring Space Numbers 2026 Expiring Space Numbers 2027 Expiring Space Numbers 2028 Expiring Space Numbers Vacant CA-02, CA- 11, CA-12, CB-08, CT-08, CT-11 CA-01, CA-08, CB-07, CC-14, CC-15, CT-17, CT-19 CC-12, CD-04, CT-04, CT-05, CT-16 BC-03 NE-01 The RFP bidding opportunities will be comprised of both single unit and multi-unit packages. For the multi-unit opportunities, there will be one food and beverage package and one retail package, and both will consist of two separate locations. There will be at least one (1) location specifically identified for small business proposals only in both the retail and food & beverage categories. To the extent possible, staff will attempt to remove/reduce barriers to entry by continuing with the competitive process improvements implemented in past RFPs. These improvements include 1) removal of capital investment scoring, 2) elimination of the bid bond requirement, 3) conducting RFP training, and 4) the establishment of Commission- approved Small Business exemptions for labor peace. The approval of these proposed RFP and subsequent contracting opportunities continues to support the Port's Century Agenda to create 100,000 new jobs and provide opportunities for small, local, and disadvantaged businesses. Diversity in Contracting The ADR program is governed by the Federal Aviation Administration (FAA) and will include Airport Concession Disadvantage Business Enterprise (ACDBE) aspirational goals in line with the Aviation Business Goals and Objectives. Current 2025 goals for ACDBE participation stands at 23.5%. DETAILS The following locations that will be released as part of this RFP include: Template revised June 27, 2019 (Diversity in Contracting). Page 90 of 373 COMMISSION AGENDA - Action Item No. 10b Meeting Date: April 22, 2025 Page 3 of 4 Schedule Preliminary schedule for the RFP and Agreement process: Commission authorization to release RFP 25-1 Release RFP 25-1 Documents Written Proposals Due for RFP 25-1 Award and Lease Agreement Execution April 2025 Q1 2026 Q1/Q2 2026 Q3/Q4 2026 Business Terms Food and Beverage Lease and Concession Agreements will be for a period of twelve (12) years. Retail Lease and Concession Agreements will be for a period of ten (10) years. These terms are standard within the ADR program an in-line with recent RFP awards/contracts including Concourse C Expansion (CCE), which was awarded in 2024. Concession fees paid by selected tenants will be determined as part of the RFP process. ALTERNATIVES AND IMPLICATIONS CONSIDERED Alternative 1 - Directly negotiate some or all twenty (20) opportunities individually with new tenants. Pros: (1) Cons: (1) (2) Doesn't require the Port to undergo the RFP process. Inhibits the process of fair competition through direct negotiation. Port will not get the benefits of a competitive process and innovations available with each of these RFPs. This is not the recommended alternative. Alternative 2 - Directly negotiate extensions/new agreement with some or all twenty (20) opportunities individually with current tenants in these locations. Pros: (1) Doesn't require the Port to undergo the RFP process. Cons: (1) Inhibits the process of fair competition. (2) Port will not get the benefits of a competitive process and innovations available with each of these RFPs. (3) No new business opportunities for an extended period. Template revised June 27, 2019 (Diversity in Contracting). Page 91 of 373 COMMISSION AGENDA - Action Item No. 10b Meeting Date: April 22, 2025 Page 4 of 4 This is not the recommended alternative. Alternative 3 - Issue competitive RFPs for the twenty (20) opportunities. Pros: (1) (2) Cons: (1) Allows for fair competition. Creates additional opportunities for new small, WMBE and ACDBE businesses and the introduction of new innovations in technology as identified in the RFP proposals. Due to the current economic environment, the Port may receive limited responses to the RFP. This is the recommended alternative. FINANCIAL IMPLICATIONS The twenty (20) spaces represent a significant portion of overall ADR program revenue. Approval of this request for the RFP process and agreement(s) execution will allow staff to ensure continuity of future non-aeronautical revenue generation of the spaces. ATTACHMENTS TO THIS REQUEST (1) Presentation PREVIOUS COMMISSION ACTIONS OR BRIEFINGS April 9, 2025 -The Commission authorized to take all steps necessary to complete the Tenant Airport Dining and Retail (ADR) Shell & Core Renovations (TASCR) project at the Seattle-Tacoma International Airport (SEA or Airport), for a total project authorization of $10,373,000. December 12, 2023 - The Commission approved the CCE RFP release of 10 spaces within Concourse C Expansion and 3 locations in areas adjacent to the Concourse C Expansion. November 12, 2023 - The Commission was briefed on ADR Master Plan and approved recommendations for the CCE RFP process. Template revised June 27, 2019 (Diversity in Contracting). Page 92 of 373 Item No. 10b_supp Meeting Date: April 22,2025 RFP Release of Expiring Leases Jeff Wolf Director, Aviation Commercial Management Khalia Moore Assistant Director, Airport Dining and Retail Scott Van Horn Manager, Business Development & Assistant ACDBE Liaison Page 93 of 373 Request Request Commission authorization for the Executive Director to (1) conduct the release of a Request for Proposal (RFP 25-1) and (2) execute a Lease and Concession Agreement with selected proposers for the twenty (20) locations that will naturally expire between 2025 and 2028. 2 Page 94 of 373 Agenda • ADR Competitive Process Improvements • Highlights of the Concourse C Expansion (CCE) RFP • Upcoming ADR RFP Opportunities (RFP 25-1) 3 Page 95 of 373 ADR Competitive Process Improvements • Removal of Capital Investment Scoring. • Removal of Bid Bond Requirement. • Conducted First Time Bidder's Training. • Creating Small Business Set-Aside within the RFP process. • Established new Commission-approved Labor Harmony/Labor Peace Requirements. 4 Page 96 of 373 ADR Competitive Process Improvements First Time Bidders Training • Prior to the release of the CCE RFP, ADR staff conducted a series of "First Time Bidders: Demystifying the RFP at SEA" Training Sessions. - Interested companies could either attend: • A four (4) week morning or afternoon session or • An all-day Saturday session - Over 200 companies attended the training. - The training provided insight into the RFP process and provided examples of how to answer the questions that are asked. 5 Page 97 of 373 Concourse C Expansion (CCE) RFP Proposals Received • CCE RFP had 11 total packages for 13 locations. - 7 food and beverage (8 locations total) - 4 retail (5 locations total) • Thirty (30) companies submitted forty (40) proposals. • Six (6) proposals did not meet the minimum qualifications and were not scored. • Two (2) proposals asked to be withdrawn for consideration. 6 Page 98 of 373 Concourse C Expansion (CCE) RFP Proposals Received Cont'd • For those Proposals that met the minimum qualifications: - Sixteen (16) companies were classified as "Small Business". - Eight (8) companies were classified as "Large Business". - Twelve (12) companies were first time bidders at SEA. - Fifteen (15) companies attended the First Time Bidders Training. • These awardees will create approximately 400 new jobs through the concessions program. 7 Page 99 of 373 Concourse Level Layout 8 Page 100 of 373 Mezzanine Level Layout 9 Page 101 of 373 Withdrawn Proposal • Local/Regional Music Centric Specialty Retail (SR-2) • The one proposal received for this package asked to be withdrawn for consideration. This location is in the current request before Commission today. 10 Page 102 of 373 SR4: Open Concept Specialty Retail Lady Yum Operated by: Lady Yum, LLC Small Business, WMBE Developed through Small Business Incubator Program Attended First Time Bidders Class 11 Page 103 of 373 FB3: Market with Specialty Food Retail Connections Gourmet Market Operated by: Bambuza South Waterfront, LLC ACDBE Operator 12 Page 104 of 373 Upcoming ADR RFP Opportunities (RFP 25-1) • Twenty (20) locations that were part of the Lease Group 1 awarded in 2016 will be released as a part of this RFP. • The space availability is broken down as follows: - Six (6) locations for Food and Beverage opportunities - Seven (7) locations for Specialty Retail opportunities - Seven (7) location for Convenience Retail opportunities • All locations will naturally expire between 2025 through 2028. 13 Page 105 of 373 ADR RFP Available Locations (RFP 25-1) 14 Page 106 of 373 CLOSING & QUESTIONS 15 Page 107 of 373 APPENDICES 16 Page 108 of 373 CCE RFP 24-1 AWARDED PACKAGES 17 Page 109 of 373 FB1: Sit Down Restaurant Nanny's: A Northwest BBQ Joint Operated by: BF Foods LLC/Heigh Connects LLC ACDBE Operator, JV with two existing ACDBE tenants Attended First Time Bidders Class 18 Page 110 of 373 FB1: Coffee with optional bar Neighborhood Cafe Operated by: BF Foods LLC/Heigh Connects LLC ACDBE Operator, JV with two existing ACDBE tenants Attended First Time Bidders Class 19 Page 111 of 373 FB2: Coffee with Experience Stumptown Coffee Roasters & Lucky Lounge Operated by: Latrelles' Next Gen, LLC 20 Page 112 of 373 SR1: Convenience Retail Bell St. Landing by Hudson Operated by: HG Sea C-1 Retail Concessions, LLC Joint Venture with 25% ACDBE and 2% Small WMBE Participation 21 Page 113 of 373 SR1: Open Concept Specialty Retail Cobb's Popcorn Operated by: HG Sea C-1 Retail Concessions, LLC Joint Venture with 25% ACDBE and 2% Small WMBE Participation 22 Page 114 of 373 SR3SB: Open Concept Specialty Retail (Small Business Only) Bite Society Operated by: The City Catering Company, Inc. DBA Bite Society New Airport Small Business, WMBE Attended First Time Bidders Class 23 Page 115 of 373 FB4: National Sit-Down Restaurant Chili's Operated by: SSP America SEA, LLC Joint Venture with 38% ACDBE Participation 24 Page 116 of 373 FB5: National Chicken Buffalo Wild Wings Operated by: Latrelle's Concourse Foods, LP 25 Page 117 of 373 FB6SB: National Sandwich(Small Business Only) Port of Subs Operated by: Global Concessions, LLC Joint Venture with two existing small business operators with 51% ACDBE participation Attended First Time Bidders Class 26 Page 118 of 373 FB7: Open Concept QSR Great State Burger Operated by: Great State Burger, LLC New Airport Small Business Attended First Time Bidders Class 27 Page 119 of 373 UPCOMING ADR RFP OPPORTUNITIES (RFP 25-1) 28 Page 120 of 373 29 Page 121 of 373 30 Page 122 of 373 31 Page 123 of 373 COMMISSION AGENDA MEMORANDUM Item No. ACTION ITEM Date of Meeting 10c April 22, 2025 DATE: March 10, 2025 TO: Stephen P. Metruck, Executive Director FROM: Linda Springmann, Director, Cruise Operations & Maritime Marketing Kelly Purnell, Capital Project Manager, Waterfront Project Management SUBJECT: Terminal 91/Pier 66 Cruise Shore Power Extension - Contract with Watts Marine, LLC for Cruise Shore Power Electrical Equipment Design and Procurement (CIP # C801983) Amount of this request: Total estimated project cost: $8,000,000 $28,300,000 ACTION REQUESTED Request Commission authorization for the Executive Director to execute a sole source purchase contract with Watts Marine, LLC (Watts) for procurement of long-lead shore power electrical equipment for Terminal 91/Pier 66 Cruise Shore Power Extension in the amount of $8,000,000. Total request for this action will be $8,000,000 for a total authorized amount of $9,350,000 out of a total estimated project cost of $28,300,000. EXECUTIVE SUMMARY In July 2024, the Port passed Commission Order No. 2024-08 mandating all homeport cruise ships to connect to shore power by 2027, three years earlier than the 2030 goal set in the Port's adopted Maritime Climate and Air Action Plan. The existing shore power systems at Pier 91 and Pier 66 need to be extended at both locations to maximize flexibility to enable shore power connections for all homeport cruise ships by the end of 2027. Due to the proprietary nature of the electrical shore power equipment and the anticipated long lead time, the project is requesting funding to execute a sole source purchasing contract with Watts Marine to ensure that design and procurement of the equipment is completed and ready for installation in Q4 of 2026. In parallel, the project will proceed with the selection of a design-builder utilizing the Progressive Design Build alternative for project delivery to design and construct the necessary berth improvements and install the shore-power equipment. The provision of shore power for cruise ships is the Port's greatest opportunity to reduce greenhouse gas (GHG) emissions and improve local air quality. Currently, the Port's Smith Cove Cruise Terminal at Pier 91 (P91) which opened in 2009 provides shore power at its two cruise Template revised January 10, 2019. Page 124 of 373 COMMISSION AGENDA - Action Item No. 10c Meeting Date: April 22, 2025 Page 2 of 8 berths. The single berth at the Bell Street Pier Cruise Terminal at Pier 66 (P66) which opened in 1999 has a new shore power system completed in September 2024. While all three of the Port's cruise berths are now electrified, additional flexibility is needed to accommodate all vessel and berthing configurations to meet Commission Order No. 2024-08. JUSTIFICATION The Port of Seattle is an industry and regional leader in economic development and sustainability. The Port's investment in cruise terminals at Pier 66 and Pier 91 result in a significant contribution to the region's economy, generating more than 5,500 jobs and nearly $900 million in total local business revenue each cruise season. The Port also recognizes its responsibility and the importance of concerted efforts to balance economic growth with sustainability. The Seattle Waterfront Clean Energy Strategic Plan and the adopted Maritime Climate and Air Action Plan provide a Port investment strategy to protect the environment and improve community health. As a global leader in sustainability, the Port is committed to addressing global climate change and improving local air quality. In 2017 the Port's Commission adopted GHG reduction targets in alignment with the Paris Climate Agreement, then updated goals in October 2021 in recognition of the climate crisis. In November 2021, the Port Commission adopted the Maritime Climate and Air Action Plan which identifies strategies and actions the Port can take through 2030 to achieve the Port's Century Agenda GHG target to reduce GHG emissions 50% by 2030 and to position the Port to phase out seaport-related emissions entirely by 2050. The plan includes a specific commitment to install shore power at all cruise berths and maximize connections by 2030. In May 2022 the Port launched a collaborative effort to explore the feasibility of a maritime green corridor aimed at accelerating the deployment of low and zero GHG emission cruise ships and operations between Alaska, British Columbia, and Washington. Most recently, the Port passed Commission Order No. 2024-08 mandating that all home ported cruise ships must connect to shore power by 2027, three (3) years earlier than the Maritime Climate and Air Action Plan 2030 goal. Shore power can significantly reduce GHG and air pollution emissions with each connection. Staff estimate shore power can avoid approximately 268 thousand metric tons of carbon (CO2e) cumulatively through 2050. Assuming a 25-year infrastructure life and $44 million cost, that represents a cost per ton of carbon reduced over the full lifespan to range from $164 to $406 per metric ton CO2e. This range is based on the 2025 cruise schedule with the current ability to connect cruise ships to shore power at Pier 91 and Pier 66 (86% of homeport calls). If 100% of homeport ships plug in consistent with the Commission Order No. 2024-08 in 2027 shore power use would result in an additional 45 thousand metric tons of cumulative carbon emissions avoided over a 25-year infrastructure life. Diversity in Contracting Watts Marine, LLC is a WMBE firm. The sole-source contract with Watts for design and procurement of the shore power equipment is 100% WMBE. Template revised June 27, 2019 (Diversity in Contracting). Page 125 of 373 COMMISSION AGENDA - Action Item No. 10c Meeting Date: April 22, 2025 Page 3 of 8 The project team in coordination with the Diversity in Contracting Department has also included a 6% WMBE aspirational goal in the Progressive Design Build major work contract for this work to design and construct the pathway for the shore power system and other structural elements of the project, and to install the Watts designed and procured shore power equipment. DETAILS The cruise shore power systems at Pier 91 and Pier 66 are both Watts Marine proprietary designs. Watts Marine is also contracted to provide operations and maintenance of the shore power systems at both locations. The first phase of the cruise shore power extension project requires the execution of a sole source purchasing contract with Watts Marine to design and procure proprietary shore power electrical equipment for Pier and Pier 66. At P91, this will include new equipment to extend the existing system and some replacement equipment for components nearing the end of its useable life. The new equipment will integrate with the existing Wattsdesigned and operated shore power system at both terminals including the mobile cable positioning devices (CPD) procured in 2024. A sole source waiver has been executed to purchase the shore power equipment from Watts Marine (Competition Waiver No. 2024-009). In conjunction with the Watts Marine purchasing agreement, the project will execute a Progressive Design Build project delivery to accelerate the design and construction of the cruise shore-power projects at both terminals and plug-in all homeported cruise ships by 2027. Scope of Work The major components of the Watts Marine purchasing contract scope for P91 and P66 cruise shore power project include the following: (1) Pier 91: West Berth:  Primary Switchgear o Replace existing transformer  Secondary Switchgear o Breakers o Remote ground switches  New saw-tooth boxes (shore power connection points)  Design, testing and commissioning East Berth:  Secondary Switchgear o Breakers o Remote ground switches  New saw-tooth boxes (shore power connection points)  Capacitor bank in east berth substation  Design, testing and commissioning Template revised June 27, 2019 (Diversity in Contracting). Page 126 of 373 COMMISSION AGENDA - Action Item No. 10c Meeting Date: April 22, 2025 Page 4 of 8 (2) Pier 66:  Secondary Switchgear o New ground switch components in blank ground switch cubical #3  One (1) new saw-tooth box (shore power connection point)  Design, testing and commissioning The scope for the Progressive Design Build contract includes the following components for both Pier 91 and Pier 66: (1) Design and Construction  Berthing study of all current and known future cruise ships to determine optimal shore power connection point locations (saw-tooth boxes) and mooring bollard locations to maximize flexibility to connect cruise ships with different shore power configurations.  Civil and structural design and construction for all materials and equipment for shore power equipment foundations, electrical conduit duct banks, vaults, saw-tooth box locations, potential limited deck panel replacement and new mooring bollards* at Pier 91 west.  Installation of Watts - procured shore power equipment. *New bollards will allow for proper mooring of ships with different shore power configurations. Currently, only ships with starboard, aft shore power connections can plug-in. Additional bollards are needed for the alternative mooring arrangements related to other shore power connection locations on the ships. Schedule The schedule to meet Commission Order No. 2024-08 is aggressive. Project constraints including other concurrent or overlapping critical projects at P91, permitting delay potential, supply chain uncertainty, and highly constrained construction work windows due to cruise operations, commercial fishing operations, and tribal agreements create the risk of schedule slippage. Schedule assumptions account for best case permitting scenarios, including avoidance of inwater work. However, until a Progressive Design Build contract is executed in which schedule assumptions can be solidified with the contractor, the ability to meet the target in-service date by cruise season of 2027 is at risk. A Progressive Design Build project delivery with a sole source contract to Watts Marine for shore power equipment design and procurement was selected to mitigate schedule risk to the extent possible. Progressive Design Build allows for some acceleration of the design process and minimizes potential for unknown construction risks that cause delays. Contracting with Watts Marine minimizes compatibility risks that could occur if introducing a different shore power technology and streamlines the design and procurement process as it is an extension of the existing system, not a replacement. Template revised June 27, 2019 (Diversity in Contracting). Page 127 of 373 COMMISSION AGENDA - Action Item No. 10c Meeting Date: April 22, 2025 Page 5 of 8 Activity Commission Authorization - T91 Mobile Cable Positioning Devices (CPDs) and T91 Cruise Shore Power Extension North initial design funding DORA - Progressive Design Build Procurement and Preliminary Design Progressive Design Build Procurement Commission Authorization - Watts Marine, LLC Purchasing Contract Executed Progressive Design Build Contract - Validation PDB Target Scope and Budget - Design Authorization PDB Design and Progressive Design Build Guaranteed Maximum Price Funding and Construction Funding Authorization Construction Start In-use date Cost Breakdown Design Pier 91 Pier 66 Material Pre-Procurements (Watts) Pier 91 Pier 66 Construction Pier 91 Pier 66 Total August 8, 2023 October 16, 2024 Q4 2024 - Q3 2025 April 22, 2025 Q3 2025 Q4 2025 Q1 2026 Q4 2026 - 2027 2027 This Request $0 $0 $0 $8,000,0000 $7,000,000 $1,000,000 $0 $0 $0 Total Project $2,100,000 $1,400,000 $700,000 $8,000,0000 $7,000,000 $1,000,000 $18,200,000 $10,600,000 $7,600,000 $0 $28,300,000 ALTERNATIVES AND IMPLICATIONS CONSIDERED Alternative 1 - Defer extension of cruise shore power systems at Pier91 and Pier 66. Continue to enable limited shore power connections for ships that are compatible with the existing shore power infrastructure. Cost Implications: While the full cost has not been estimated, per the mandate of Commission Order No. 2024-08, cruise ships that cannot connect to shore power by 2027 may not be able to dock at Port cruise berths impacting the cruise revenue for each ship turned away. Pros: (1) Cons: (1) Provides time for Port to apply for grants to fund extension of shore power system. Does not meet the mandate of Commission Order No. 2024-08 to connect all homeported cruise ships to shore power by 2027. Template revised June 27, 2019 (Diversity in Contracting). Page 128 of 373 COMMISSION AGENDA - Action Item No. 10c Meeting Date: April 22, 2025 (2) (3) Page 6 of 8 Impacts cruise revenues. Maintains status quo on GHG emissions. This is not the recommended alternative. Alternative 2 - Do not sole-source design and procurement of shore power equipment to Watts Marine and allow for proposals for any shore power system vendor. Cost Implications: Full cost analysis for this alternative has not been estimated. However, an entirely new system would exceed the cost of extending an existing system in which most of the major electrical components can remain in place. Pros: (1) Cons: (1) (2) (3) Potential for innovative kinds of shore power systems. Opening the shore power system procurement to vendors other than Watts Marine will require a complete rebuild of the shore power infrastructure at both Pier91 and Pier 66 Will cause a disruption in the operations and maintenance of the system as it is currently operated by Watts. Will require additional time for design and procurement, risking the already tight schedule. This is not the recommended alternative. Alternative 3 -Sole-source contract to Watts Marine for design and procurement of the shore power equipment in collaboration with a Progressive Design Build contract. Cost Implications: $8,000,000 Pros: (1) (2) Cons: (1) Minimizes risk of shore power system incompatibility by extending the existing Wattsdesigned and operated proprietary shore power system at both Pier 91 and Pier 66. Executing a sole-source purchasing contract with Watts Marine allows for long-lead shore power equipment to be designed and ordered early. Limits potential for innovation in system design. This is the recommended alternative. FINANCIAL IMPLICATIONS Cost Estimate/Authorization Summary COST ESTIMATE Original estimate Previous changes - net* Revised estimate Capital Expense Total $4,000,000 $24,300,000 $28,300,000 $0 0 0 $4,000,000 $24,300,000 $28,300,000 Template revised June 27, 2019 (Diversity in Contracting). Page 129 of 373 COMMISSION AGENDA - Action Item No. 10c Meeting Date: April 22, 2025 AUTHORIZATION Previous authorizations Current request for authorization Total authorizations, including this request Remaining amount to be authorized Page 7 of 8 1,350,000 8,000,000 $9,350,000 $18,950,000 0 0 0 $0 1,350,000 8,000,000 $9,350,000 $18,950,000 * The original estimate for this project assumed a single new shore power connection point on the west berth of Pier 91. In July 2024, Commission Order No. 2024-008 was passed requiring all home ported cruise ships to connect to shore power by 2027. To meet the mandate, scope was expanded to include multiple additional connection points on both the east and west berths of Pier 91, as well as adding a third connection point to the existing shore power system at Pier 66. The shore power equipment at Pier 91 is also nearing the end of its useable life and is no longer serviceable, necessitating the replacement of breakers and the west berth transformer to accommodate extension of the shore power system to meet the project objectives. This increased the overall budget needs for the larger scope. Annual Budget Status and Source of Funds This project is a combination of two previous projects included in the 2025 Capital Plan C801983 P66 Shore Power Extension ($7.5M) and C801293 T91 Cruise Shore Power Extension ($15.8M) with a total project cost of $23,300,000. The updated project costs, including the addition of bollards, will be covered by Maritime Reserve C800001. Future spending will be funded by the General Fund. Financial Analysis and Summary Project cost for analysis Business Unit (BU) Effect on business performance (NOI after depreciation) IRR/NPV (if relevant) CPE Impact $28,300,000 Cruise Operations •No incremental operating revenue or cost-savings is directly associated with this project. • Annual maintenance and repair contract costs for P66 shore power equipment are included in the 2025 budget at $90,000. • Annual depreciation expense is expected to increase by approximately $1.1M. N/A N/A Future Revenues and Expenses (Total cost of ownership) The electricity utility expenses at Pier 66 will be recovered through utilities sales revenue, so there is no net cost to the Port. The annual contract maintenance and repair expenses at Pier 66 are included in the 2025 approved budget at $90,000. The electricity utility expenses at Pier 91 are paid directly by the cruise line to Seattle City Light. The existing shore power equipment is Template revised June 27, 2019 (Diversity in Contracting). Page 130 of 373 COMMISSION AGENDA - Action Item No. 10c Meeting Date: April 22, 2025 Page 8 of 8 currently owned and maintained by the cruise line. If the Port takes ownership of the existing equipment, the Port will enter into an agreement with Seattle City Light and invoice the cruise lines for electricity use to recover the costs. ADDITIONAL BACKGROUND Originally, Pier 91 and Pier 66 cruise shore power projects were envisioned as two separate projects under two CIP #s. Initial funding for the Pier 91 Cruise Shore Power Extension North was authorized by Commission on August 8, 2023, inclusive of the purchase of two (2) mobile cable positioning devices (CPD) under CIP # C801293. Pier 66 Cruise Shore Power Extension was under CIP # C801983. As part of a DORA executed on October 16, 2024 for a Progressive Design Build procurement and early design for both projects, Pier 91 Cruise Shore Power Extension, except for the costs associated with the purchase of the CPDs which remained under C801293, was transferred to CIP # C801983 with P66 to consolidate the projects under a single CIP and to help expedite both projects to meet the mandate of Commission Order No. 2024-008 to connect all home ported cruise ships to shore power by 2027. ATTACHMENTS TO THIS REQUEST (1) Presentation PREVIOUS COMMISSION ACTIONS OR BRIEFINGS August 8, 2023 - The Commission authorized funding for Pier91 Cruise Shore Power Extension and CPDs in the amount of $2,500,000 for the purchase of the CPDs and early design funding of the extension. Template revised June 27, 2019 (Diversity in Contracting). Page 131 of 373 Item No.: 10c_Supp Meeting Date: April 22, 2025 Pier 91/ Pier 66 Cruise Shore Power Extension Project Watts Marine Contract Funding Page 132 of 373 Action Requested Request Commission authorization for the Executive Director to execute a sole source purchase contract with Watts Marine, LLC (Watts) for procurement of long-lead shore power electrical equipment for the Terminal 91/Pier 66 Cruise Shore Power Project (C801983) in the amount of $8,000,000, for a total estimated project cost of $28,300,000. 2 Page 133 of 373 Project Purpose • • • In July 2024, Commission Order No. 2024-08 was passed mandating that all homeport cruise ships connect to shore power by 2027. To meet the mandate, the existing shore power systems need to be extended at Pier 91 and Pier 66. - Currently, the shore power cables cannot reach from the berth connection point to plug-in locations on all shore power capable ships. This project will provide maximum flexibility in how ships with different shore power configurations berth at the pier so they can connect to shore power. 3 Page 134 of 373 Existing Shore Power Systems • Pier 66 Bell Street Pier - Commissioned in 1999 - Single berth facility and home port to Norwegian and Oceania vessels - Upgraded to accommodate newest NCL vessels in 2018 - Watts Marine designed shore power system; operational in 2024 • Pier 91 - Smith Cove Cruise Terminal - Designed and operated by Watts Marine. In 2009 the system was moved from Terminal 30 to Pier 91. - Two berth facility and home port to Carnival, Princess, Holland America, Royal Caribbean and Celebrity cruise lines - Multi-industry berths: turns over to commercial fishing fleet after cruise season • Pier 66 and Pier 91 together contribute to significant jobs and economic benefits to the region: 5,500 jobs and nearly $900M in total business revenue each typical cruise season 4 Page 135 of 373 Shore Power is a Key Environmental Strategy Maritime Climate and Air Action Plan: • Reduce GHG emissions 50% by 2030; phase out seaport-related emissions by 2050 • Implement the Seattle Waterfront Clean Energy Strategy • Install shore power at all cruise terminals and maximize connections by 2030  accelerated by Commission Order No. 2024-08 to make 100% of homeport calls shore power-capable and plug in by 2027 • Incorporate sustainability best practices into leases and agreements Each cruise shore power connection avoids 30 MTCO2e equivalent to driving from Seattle to NYC and back 13 times ~4,000 MTCO2 avoided by shore power in 2024 All homeport ships plugging in can reduce cruise emissions 12% across the airshed 5 Page 136 of 373 Project Details • • Contract Type: - Sole-Source purchasing contract for Watts Marine, LLC for design and procurement of shore power equipment (Comp. Waiver 2024-009) - Progressive Design Build contract for major work - Budget: $28.3M WMBE Goal: - PDB contract - 6% - Watts Marine is a women-owned business 6 Page 137 of 373 Project Areas - Pier 91/Pier 66 New shore power connections Area Existing Shore power system New shore power connections Area Pier 91 Pier 66 Pier 66 NewBollard shoreUpgrade power connections Potential Mooring Existing shore power system Pier 91 7 Page 138 of 373 Project Scope • Design and construct all necessary infrastructure upgrades to (2) Pier 91 cruise berths and Pier 66 cruise berth to meet project goals, including : - Conduct a berthing and mooring study for all known current and future ships to determine optimal connection locations, distribution pathways, and required mooring bollard upgrades. - Extend the existing shore-power system to allow all known current and future ships of different configurations to connect to shore-power - Ensure compatibility of the extended cruise shore power system with existing equipment and facilities, including the mobile cable positioning devices (CPD). - Procure all permits - Replacement of existing shore power equipment that has reached end of service life at Pier 91. - New mooring bollards at Pier 91 - Potential limited deck panel replacements at Pier 91 8 Page 139 of 373 General Considerations and Risks • Active terminal with multiple stakeholders and competing needs. • Other Projects with potentially overlapping schedules are areas of impact. • Constrained entrances shared with existing tenants. • Seasonal use by cruise and commercial fishing that will require ongoing coordination and accommodation. • Active security plan • Neighborhood sensitivity to adjacent circulation patterns and noise 9 Page 140 of 373 Permitting Considerations • SEPA Threshold Determination - DNS • Substantial Shoreline Development Permit (MUP) • Construction permit • Potential In-water Work • NPDES Construction Stormwater General permit • Other 10 Page 141 of 373 Project Schedule Phases Anticipated Dates Watts Marine Sole-Source Purchasing Contract Authorization Q2 2025 PDB Team Selected / Contract Executed Q3 2025 Validation Period Q3 2025 Early Design Development Authorization (target GMP, schedule, scope) Q4 2025 Final Design & Construction Authorization (final GMP, schedule, scope) Q2 2026 Construction Q3 2026 In-Use 2027 11 Page 142 of 373 Project Funding Cost Estimate/Authorization Summary Capital Expense Total COST ESTIMATE Original estimate $4,000,0000 $0 $4,000,0000 Previous changes - Net* $24,300,000 $0 $24,300,000 Revised estimate $28,300,000 $0 $28,300,000 Previous authorizations • Preliminary Design/Procurement • Terminal 91 • Pier 66 $1,350,000 $0 $1,350,000 Current request for authorization • Material Pre-Procurements (Watts) • Terminal 91 • Pier 66 $8,000,0000 Remaining amount to be authorized $18,950,000 AUTHORIZATION $850,000 $500,000 $850,000 $500,000 $0 $7,000,000 $1,000,000 $8,000,0000 $7,000,000 $1,000,000 $0 * The original estimate for this project assumed a single new shore power connection point on the west berth of Pier 91. In July 2024, Commission Order No. 2024-008 was passed requiring all homeport cruise ships to connect to shore power by 2027. To meet the mandate of this order, scope for this project was expanded to include multiple additional connection points on both the east and west berths of Pier 91, as well as adding a third connection point to the existing shore power system at Pier 66. $18,950,000 12 Page 143 of 373 Opportunities OPPORTUNITY DESCRIPTION Sole-Source contract with Watts Marine Contract with Watts Marine for design and procurement of shore power equipment allows for early procurement of long-lead shore power materials and mitigates the risk of compatibility issues that would be introduced with by trying to integrate a new shore power technology to the existing shore power configuration. This will help to accelerate the project schedule and minimize potential for delays due to supply chain uncertainty, to meet the mandate of Commission Order No. 2024-08. Progressive Design Build project delivery Utilizing PDB project delivery allows for acceleration of the project schedule to meet the mandate of Commission Order No. 2024-08 13 Page 144 of 373 RISKS DESCRIPTION Constrained Schedule Delivery required by 2027. Minimal work windows due to cruise season, commercial fishing season, tribal agreements, and fish window if in-water work is needed have high potential to delay in-service date past cruise season start in 2027. Two contracts to manage Two contracts to manage: Progressive Design Build (PDB) and Watts Marine sole-source. Scope was separated into (2) contracts to get equipment design and procurement started early to minimize long lead materials issues and due to proprietary shore power technology. Potential for conflicts between contracts causing delays Supply chain uncertainty Supply chain logistics could delay project delivery. Tariffs could impact ability to procure long-lead electrical equipment by 2027, and create uncertainty in pricing. Ownership of the existing cruise shore power system at T91 Ownership is still held by Carnival Cruise. Logistics of ownership transfer could drive up project costs. Coordination with other projects at Terminal 91 Permitting PROBABILITY IMPACT MITIGATION High High Utilize Progressive Design Build project delivery to accelerate timeline. Pre-purchase of long-lead items. Med Clearly defined scope delineation between PDB and Watts in procurement documents. Requirement of NDAs for Watts information to be signed for any interested contractors. Port will facilitate design integration for Watts shore power equipment. High High Adding cost contingencies to account for tariff price impacts. Early execution of Watts contract to begin procurement of long-lead shore power equipment in advance. Med Low Project Risks There are many other projects scheduled on Pier 91 with similar timelines to the cruise shore power project: gangways, water line replacement, dock rehabilitation, west berth dredging. Permitting assumptions are aggressive and assume no inwater work. This could change depending on how the contractor must construct the project. In-water work, or any other permitting delays will delay the project. High Cruise Operations is in negotiation to transfer ownership to the Port. High Med Identification of all on-going and upcoming construction work at Terminal 91. Requirement of logistics plan by PDB to account for constraints of other projects. High High Progressive Design Build project delivery will allow for early collaboration on design and permitting to the extent feasible. 14 Page 145 of 373 Cone of Certainty We are here 15 Page 146 of 373 Next Steps • • • Progressive Design Build contract execution Q3 2025 - Validation Period Q3 Commission Authorization for Design/early work Q4 2025 - Target scope/schedule/cost with PDB Commission Authorization Final design/Construction Q2 2026 - Final GMP, scope, schedule 16 Page 147 of 373 Questions? 17 Page 148 of 373 COMMISSION AGENDA MEMORANDUM Item No. ACTION ITEM Date of Meeting DATE: April 14, 2025 TO: Stephen P. Metruck, Executive Director FROM: Eileen Francisco, Director Aviation Project Management Group Wendy Reiter, Director Airport Security 10d April 22, 2025 SUBJECT: Baggage Optimization Program Phase 3 Amount of this request: Total estimated project cost: $477,373,982 $1,074,638,982 ACTION REQUESTED Request Commission authorization for the Executive Director to take all steps necessary, including the execution of all contracts, including Public Works, Alternative Public Work procedures in accordance with RCW 29.10, Goods and Services Personal Services, Professional Services, other consulting services, and any other types of contracts or agreements to complete the Baggage Optimization Program Phase 3 for a total program budget authorization of $1,074,638,982. EXECUTIVE SUMMARY Baggage Optimization is an airport-wide public safety and security program that improves customer service for both airlines and passengers. This is a long-term, three-phase program that is anticipated to be completed in 2029. The program allows the flexibility for bags to be checked in from any ticket counter and be conveyed to serve any gate. The project is being constructed in three separate phases. Phase 1 and Phase 2 have been completed, and development of Phase 3 began in Q3 2022. Due to the lack of interconnectivity until the project is complete, near continuous operation, and a fixed footprint, this project has various constraints requiring detailed construction sequencing plans. A General Construction/Construction Manager (GC/CM) was selected for Phase 3 to leverage cost certainty early on during the design phase. This request is for full authorization to complete the last phase of the Baggage Optimization Program. To leverage cost certainty early on during the design phase, the project team worked with the Contractor to develop the Phase 3 estimate. During design, the project team negotiated pricing associated with scope and construction schedule and was able to negotiate the cost down; however, Phase 3 requires a budget increase to complete the overall program. Budget increases are attributed to lack of competition for the specialized baggage handling system installation and electrical work. Since 2022 there has also been a continued escalation in cost in electrical labor and equipment. The project budget was also impacted by the specialized baggage handling contractor and electrical contractors' fees. Construction duration also increased by a year due Template revised January 10, 2019. Page 149 of 373 COMMISSION AGENDA - Action Item No. 10d Meeting Date: April 22, 2025 Page 2 of 7 to operational risk mitigation to keep the baggage systems functional during construction and minimizing downtime to Airlines operations. This duration has also impacted the overall project costs. The team analyzed alternatives to reduce scope and budget however the alternatives did not meet the overall project objective and Airlines expectations. JUSTIFICATION The highly utilized and aging Baggage Handling System (BHS) is one of the most complex systems in the airport. Originally the Airport's baggage system was not a single system, but rather six separate outbound systems. Phase 1 and Phase 2 have completed two thirds of the system; Phase 3 completes the program for an optimized system. After the events of September 11, modifying the separate systems was the best way to rapidly increase security. At the time, each separate system was designed to include a nominal amount of passenger growth. Over the ensuing years as specific airline needs emerged or as airlines were relocated, the separate systems have been updated to meet the carriers' specific operating needs. Although various baggage projects have been implemented to address operating needs over the years, the systems continue to have limited capacity to meet both near- and long-term growth needs of the Airport. The airport baggage system is faced with three problems: 1. The existing systems have major subsystems, such as controls, that are aging and must be replaced. 2. There is limited ability for the current systems to be expanded in their current configuration to adequately meet growing passenger demands; and 3. These separate systems lack interconnectivity between ticket counters and all their aircraft gates. Passenger growth has increased in unprecedented amounts and is expected to continue. This is a major and near-term challenge for the Airport due to both the complexity of keeping operations ongoing during construction and major space constraints on expanding the systems' capacity to meet future growth. Diversity in Contracting Baggage Optimization Phase 3 construction contracts have a 4% Women and Minority Business Enterprises (WMBE) goal. DETAILS Scope of Work Baggage Optimization Phase 3 will conclude the Baggage Optimization Program allowing for complete baggage flexibility to check in any bag into any ticket counter and be delivered to any airplane. It also accommodates passenger volume growth and meets Transportation Security Administration (TSA) safety mandates. This phase will tie-in all the south end systems into the centralized screening, including the International Arrivals Facility (IAF), and finalize the sortation and ticket counter connections. Template revised June 27, 2019 (Diversity in Contracting). Page 150 of 373 COMMISSION AGENDA - Action Item No. 10d Meeting Date: April 22, 2025 Page 3 of 7 Schedule Phase 1 was completed in 2020. Phase 2 was completed in Q3 2024. Phase 3 is under way with GC/CM preconstruction activities and construction is scheduled to complete in Q4 2029. Phase Phase 1 Phase 2 Phase 3 Design Q3 2015 - Q1 2016 Q1 2020 - Q3 2020 Q1 2023 - Q1 2025 Construction Q1 2016 - Q2 2020 Q3 2020 - Q3 2024 Q2 2025 - Q4 2029 Activity Commission design authorization - All Phases Phase 3 Design start Phase 3 Commission construction authorization 2013 Q1 2022 Q2 2025 Q1 Phase 3 Construction start Phase 3 In-use date 2025 Q4 2029 Q4 Cost Breakdown This Request Total Project Design Construction Total $0 $477,373,982 $477,373,982 $80,731,152 $993,907,830 $1,074,638,982 ALTERNATIVES AND IMPLICATIONS CONSIDERED Alternative 1 - Non-integration of IAF would delete scope to fully integrate IAF into the optimized system keeping it as a separate airline and screening operation. Cost Implications: There would be an estimated $40,000,000 reduction in cost. Pros: (1) (2) (3) Cons: (1) (2) (3) (4) (5) (6) Operations for Airlines and TSA would not change from current condition. Decreases the overall construction cost and reduces the budget by an estimated $40,000,000. Provides limited screening redundancy for by about 15%. Not supported by Airlines and Port stakeholders. A split Airline operation for alarmed bags results in an increased labor cost. Safety concerns with higher tug congestion/traffic with a split operation. Increases connection times for international recheck baggage. Increased cost for TSA staff operating in two screening areas. Reduced flexibility for any bag to go anywhere. This is not the recommended alternative. Template revised June 27, 2019 (Diversity in Contracting). Page 151 of 373 COMMISSION AGENDA - Action Item No. 10d Meeting Date: April 22, 2025 Page 4 of 7 Alternative 2 - Integration of IAF - This option does not change the original scope to integrate IAF into the optimized system to provide complete flexibility. Cost Implications: This alternative has a budget of $40,000,000 that is included in the budget increase request. Pros: (1) (2) (3) (4) (5) (6) (7) Cons: (1) (2) Supported by the Airlines and internal Port stakeholders. Reduces the complexity of the control environment running the system and fixes issues with IAF controls. Provides a single operation for the Airlines and reduces staffing. Adds baggage makeup capacity and flexibility to IAF. Reduces TSA staffing to one screening area. Less tug traffic and congestion in the bagwell for safer conditions. Cost to complete the full integration of all baggage systems may be cheaper now that waiting for a later project. This is the more expensive option. Lose the limited screening redundancy. This is the recommended alternative. FINANCIAL IMPLICATIONS Estimated Project Cost Current Authorization Phase 1 $97,638,982 $101,375,000 Phase 2 $376,000,000 $415,675,000 Phase 3 $585,500,000 $54,715,000 Executive Management Reserve $0 $10,000,000 CCE Transfer $15,500,000 $15,500,000 Notes  Complete  Substantial completion reached Q4 2024  Design Complete  Authorized during Phase 2  Commission approval April 2022 TOTAL $1,074,638,982 $597,265,000 Cost Estimate/Authorization Summary COST ESTIMATE Original 2013 estimate Capital $317,000,000 Expense $150,000 Total $317,150,000 Template revised June 27, 2019 (Diversity in Contracting). Page 152 of 373 COMMISSION AGENDA - Action Item No. 10d Meeting Date: April 22, 2025 Previous changes - net Current change Revised estimate AUTHORIZATION Previous authorizations Current request for authorization Total authorizations, including this request Remaining amount to be authorized Page 5 of 7 $637,134,000 $119,638,982 $1,073,772,982 $716,000 $637,850,000 $0 $119,638,982 $866,000 $1,074,638,982 $596,799,000 $476,973,982 $1,073,772,982 $466,000 $597,265,000 $400,000 $477,373,982 $866,000 $1,074,638,982 $0 $0 $0 Annual Budget Status and Source of Funds Project C800612 was included in the 2025-2029 Capital Budget and Plan of Finance with an allocated budget of $954,134,000. A budget increase of $119,638,982 will be transferred from the Aeronautical Allowance CIP C800753, with no net change to the Airport's capital budget. Budget increases are due to limited competition for specialized baggage handling and electrical work, rising electrical labor and equipment costs since 2022, and contractor fees. Phases 1 and 2 received prior Majority-in-Interest (MII) airline approval, and per SLOA V, Phase 3 no longer requires a ballot. The project funding sources include airport development and revenue bonds. Financial Analysis and Summary Project cost for analysis Business Unit (BU) Effect on business performance (NOI after depreciation) IRR/NPV (if relevant) CPE Impact $1,074,638,982 Baggage System NOI after depreciation will increase due to inclusion of capital (and operating) costs in airline rate base. N/A $0.34 in 2020, $0.96 in 2024 and $2.79 in 2029 ATTACHMENTS TO THIS REQUEST (1) Presentation slides PREVIOUS COMMISSION ACTIONS OR BRIEFINGS   March 26, 2024 - Request Commission authorization for the Executive Director to (1) authorize an early work construction contract for Baggage Optimization Phase 3 including construction of D1 and C94 transfer lines, (2) procure long lead items, and (3) increase the project authorization by $7,500,000. January 24, 2023 - Request Commission authorization for the Executive Director to: 1) execute an OTA with TSA for a 24-month time extension for the period of performance on the Baggage Optimization Program, 2) execute future Change Orders on the Baggage Optimization Project Phase 2 and Phase 3 construction contracts (C800612) up to the executed Commission authorization amount that exceed $300,000 and/or exceed 60 calendar days' time extensions, and 3) include a Project Labor Agreement (PLA) for Phase 3. Template revised June 27, 2019 (Diversity in Contracting). Page 153 of 373 COMMISSION AGENDA - Action Item No. 10d Meeting Date: April 22, 2025                  Page 6 of 7 July 26, 2022 - Request Commission authorization for the Executive Director to: (1) execute an agreement with the Transportation Security Administrative (TSA) to provide clear access to screening equipment for Phase 2, (2) authorize $34,215,000 for Phase 3 to complete pre-construction services, (3) utilize, advertise, and execute a General Contractor/Construction Manager (GC/CM) for Phase 3, (4) advertise and execute a project specific Construction Management (CM) and Airline Technical Representative (ATR) contract for Phase 3, (5) amend Service Agreement (SA) P-00317641 to add $18,340,000 for a total contract value of $49,500,000 to complete design services and provide construction support for Phase 3, and (6) utilize Port crews for Phase 3 activities, for Baggage Optimization Project at Seattle-Tacoma International Airport. The total amount of this request is $34,215,000. April 19, 2022 - Baggage Optimization Program Update - Quarter 2, 2022. January 28, 2020 - Commission Authorization to: (1) execute a construction contract with the low responsive and responsible bidder for the Baggage Optimization Phase 2 Project at Seattle-Tacoma International Airport, notwithstanding the low bid exceeding the estimate at time of bid by more than 10 percent, and (2) authorize an additional $190,737,800 for Phase 2 construction and Phase 3 design for a total program authorization of $540,050,000. April 23, 2019 - Commission Authorization to: (1) advertise, award, and execute a construction contract for the Baggage Optimization Phase 2 project at Seattle-Tacoma International Airport; (2) employ a project labor agreement (PLA); and (3) utilize Port crews and small works contracts to perform construction work. February 26, 2019 - Baggage Optimization Quarter 4 Project Briefing. October 23, 2018 - Baggage Optimization Quarter 3 Project Briefing. June 12, 2018 - Baggage Optimization Quarter 2 Project Briefing. January 9, 2018 - Baggage Optimization Quarter 4 Project Briefing. September 26, 2017 - Baggage Optimization Quarter 3 Project Briefing. June 27, 2017 - Commission authorization to (1) authorize additional design and project management funds to expand the capacity to 60 million annual passengers (MAP); (2) use Port crews and small works contracts to perform additional construction work; and (3) amend Service Agreement P-00317641 to add $10,160,000. October 25, 2016 - Baggage Optimization Quarter 4 Project Briefing. July 12, 2016 - Commission authorization to advertise and execute a contract for Construction Phase 1. June 28, 2016- Baggage Program Briefing. May 17, 2016 - Checked Baggage Optimization Project Briefing. March 8, 2016 - Commission authorization for the Chief Executive Officer to amend the Baggage Optimization Design Services contract. June 23, 2015 - Checked Baggage Optimization Project Briefing. September 10, 2013 - The Commission authorized the execution of an Other Transaction Agreement (OTA) with TSA for reimbursable costs for design and construction, to authorize $15 million to continue from 30% to 100% design and execute a consultant service agreement for program management support services. Template revised June 27, 2019 (Diversity in Contracting). Page 154 of 373 COMMISSION AGENDA - Action Item No. 10d Meeting Date: April 22, 2025         Page 7 of 7 August 20, 2013 - Response to questions from Commissioners asked during the August 6, 2013 Commission Meeting. August 6, 2013 - The Commission was briefed on the near-term and long-term challenges related to handling checked baggage at the Airport. January 22, 2013 - The Commission authorized $5 million for staff to begin design through 30%, and to enter into an agreement to allow reimbursement from the federal government to the Port for eligible elements of the 30% design effort. January 8, 2013 - Baggage Systems Briefing. August 14, 2012 - Baggage system recapitalization/optimization was noted in the 2013 business plan and capital briefing as a significant capital project not included in 2013-17 capital program. August 7, 2012 - Baggage system recapitalization/optimization was referenced as one of the drivers for the need to develop an Airport Sustainability Master Plan. June 26, 2012 - The Airport's baggage systems were discussed during a briefing on terminal development challenges. May 10, 2012 - TSA's interest in a national recapitalization/optimization plan for all baggage-screening operations was referenced in a design authorization request for the C60-C61 Baggage Handling System Modifications Project. Template revised June 27, 2019 (Diversity in Contracting). Page 155 of 373 Item No. 10d_supp Date of Meeting April 22, 2025 Baggage Optimization Program Phase 3 April 22, 2025 Page 156 of 373 Baggage Optimization Purpose and Scope • Purpose: • Airport wide public safety and security program that improves customer service for both airlines and passengers by providing flexibility, reliability, and efficiency. • Scope: • The Baggage Optimization project replaces six individual baggage screening systems with a centralized system that optimizes the operation and functionality of the checked baggage system. 2 Page 157 of 373 Phase 1 • • • • • • • Contract Method: Design/Bid/Build Construction completed 2020 Installed 8 new baggage screening machines Constructed new building extension to Central Terminal Constructed new Checked Baggage Resolution Area for TSA Constructed new Maintenance breakrooms & locker rooms Constructed new TSA breakrooms Phase 2 • • • • • • Contract Method: Design/Bid/Build Construction Completed in 2024 Installed 4 baggage screening machines Constructed new tenant storage & maintenance shop Baggage handling system sortation matrix was constructed Added additional baggage capacity to South Satellite 3 Page 158 of 373 Phase 3 • • • • • Contract Method: General Contractor/Construction Manager (GC/CM) Demolish and connect the two final baggage systems, C60 and C61 Modify the International Arrivals Facility (IAF) Baggage Handling System to facilitate both IAF and final sortation destination makeup devices Update upper-level controls for entire system Make all ticket counter and sortation final connections for a fully optimized system 4 Page 159 of 373 Phase 3 Schedule Commission Current Schedule GC/CM Pre-Construction Contract Execution Q3 2023 Q3 2023 Design Finish Q4 2024 Q1 2025 Permit has not been issued MACC Negotiation Complete Q4 2024 Q1 2025 Extended negotiations to reduce estimate by $97M GC/CM Contract Execution Q4 2024 Q2 2025 GC/CM NTP Q4 2024 Q3 2025 Substantial Completion Q2 2027 Q4 2029 Milestone (March 2024) Notes Contractor increased Construction duration 5 Page 160 of 373 Program Budget Project Name Budget Current Estimate Over/Under Budget Baggage Optimization Phase 1 $101,375,000 $97,638,982 $(3,736,018) Baggage Optimization Phase 2 $395,675,000 $376,000,000 $(19,675,000) Baggage Optimization Phase 3 $432,450,000 $585,500,000 $153,050,000 CCE Transfer Line $15,500,000 $15,500,000 $0 Baggage Optimization Executive Management Reserve $10,000,000 $0 $(10,000,000) $955,000,000 $1,074,638,982 $119,638,982 (13%) Total 6 Page 161 of 373 Request • Request Commission authorization for the Executive Director to take all steps necessary, including the execution of all contracts, including Public Works, Alternative Public Work procedures in accordance with RCW 29.10, Goods and Services Personal Services, Professional Services, other consulting services, and any other types of contracts or agreements to complete the Baggage Optimization Program Phase 3 for a total Program budget of $1,074,638,982. 7 Page 162 of 373 COMMISSION AGENDA MEMORANDUM BRIEFING ITEM Item No. Date of Meeting DATE: March 12, 2025 TO: Stephen P. Metruck, Executive Director FROM: Tom Fagerstrom, Senior Environmental Program Manager Paris Edwards, Senior Environmental Management Specialist 11a April 22, 2025 SUBJECT: 2025 Fly Quiet Awards EXECUTIVE SUMMARY Each year, the Port of Seattle evaluates airlines operating at Seattle-Tacoma International Airport (SEA) to assess their noise reduction efforts that help to limit the impact of aircraft noise on local communities. Airlines excelling in this endeavor receive Fly Quiet Award recognition. Today's presentation will include an overview of the annual Fly Quiet Award Program and 2025 Award recipients. FLY QUIET AWARDS Port staff developed the annual Fly Quiet awards in 2002, with input from a citizen advisory committee, to increase airline and pilot awareness of aircraft noise impacts on local communities. Fly Quiet was included as a continuing noise program measure in the most recent Part 150 Noise Study update completed in 2014. Fly Quiet recognizes airlines based on the following criteria: 1) the sound levels of their operations using four of the Port's noise monitors, 2) success at flying within SEA's noise abatement flight procedures, 3) adhering to SEA's ground maintenance engine run-up regulations, and 4) limiting noise levels during late-night hours at SEA. Using these scoring criteria, two airlines are recognized as the highest achieving carriers, and a third airline is recognized as having made a significant improvement over the previous year. Air Canada  Top scoring Fly Quiet airline for operations in 2024.  Remarkably low takeoff noise utilizing a modern fleet of quiet Airbus A220 and Boeing 737MAX aircraft.  Fly the established Noise Abatement flight procedures at SEA very accurately.  Third consecutive year with a Fly Quiet Award. Template revised April 12, 2018. Page 163 of 373 COMMISSION AGENDA - Briefing Item No. 11a Meeting Date: April 22, 2025 Page 2 of 2 Frontier Airlines  High scoring airline with consistently lower noise levels than other domestic carriers.  Operate the quiet Airbus A320neo aircraft at SEA.  Consistently strong performer in Fly Quiet each year.  Sixth Fly Quiet Award overall Air France  Recognized for undertaking significant improvements to their aircraft fleet in 2024.  Operate the quiet Airbus A350 aircraft at SEA  Significant commitment to updating fleet and limiting noise to local communities. ATTACHMENTS TO THIS BRIEFING (1) Presentation slides PREVIOUS COMMISSION ACTIONS OR BRIEFINGS May 14, 2024 - Announced 2024 winners of Sustainable Century and Fly Quiet Awards: Air Canada, Frontier Airlines, Delta Air Lines Template revised September 22, 2016. Page 164 of 373 Item No. 11a_supp Meeting Date: April 22, 2025 2025 Fly Quiet Awards Paris Edwards Sr Environmental Management Specialist Management Specialist r Environmental Management Specialist Page 165 of 373 Fly Quiet Award Program • The Fly Quiet Program was implemented in 2002 as a component of the Part 150 Study update. • The Fly Quiet award was developed to increase airline awareness of the impact of aircraft noise on local communities. • Fly Quiet evaluates flight procedures and noise levels of aircraft operating at SEA recognizing the two airlines with best record of achievement. • A third award is given to an airline that showed significant improvement or lessened their noise impact over the course of the year at SEA. 2 Page 166 of 373 2025 Fly Quiet Award Scoring A total of three airlines are recognized annually for their noise reduction accomplishments Two airlines are awarded for best overall scores achieved in these categories: • Low noise levels of takeoffs and landings • High level of compliance with noise abatement flight procedures • Compliance with SEA ground maintenance engine run-up rules • Low levels of noise exceedances during late night hours Winning airlines: Air Canada and Frontier Airlines 3 Page 167 of 373 2025 Fly Quiet Awards Air Canada • Achieved high scores in all four categories • Operate the very modern and quiet Airbus A220 and Boeing 737-MAX8 aircraft • This is Air Canada's 3rd consecutive Fly Quiet Award 4 Page 168 of 373 2025 Fly Quiet Awards Frontier Airlines • Achieved very high scores in all four categories • Operate the very modern and quiet Airbus A320 and A321 family of aircraft including the quiet Airbus A320NEO. • This is Frontier's 6th Fly Quiet Award 5 Page 169 of 373 2025 Fly Quiet Awards Air France • Remarkably low takeoff and arrival noise utilizing a modern fleet of Airbus A350-900 and Boeing 787-9 aircraft. • The utilization of the Airbus A350 and Boeing 787 aircraft significantly improved Air France's overall Fly Quiet score from 2023 6 Page 170 of 373 Fly Quiet Next Steps • Port press release announcing winning airlines • Fly Quiet banners displayed in SEA main terminal • Website updates - including entire list of Fly Quiet scores • Magazine advertisement 7 Page 171 of 373 QUESTIONS? 8 Page 172 of 373 COMMISSION AGENDA MEMORANDUM BRIEFING ITEM Item No. Date of Meeting DATE: March 7, 2025 TO: Stephen P. Metruck, Executive Director FROM: Sandra Kilroy, Senior Director, Environment & Sustainability Sarah Ogier, Director, Maritime Environment & Sustainability David Fujimoto, Sr. Environmental Program Manager 11b April 22, 2025 SUBJECT: Seattle Waterfront Clean Energy Strategy Briefing EXECUTIVE SUMMARY The Seattle Waterfront Clean Energy Strategy (SWCES) is a first-of-its-kind collaboration between the Port of Seattle (Port), Northwest Seaport Alliance (NWSA), and Seattle City Light (SCL) to assess the power infrastructure investments and strategies needed to support the electrification of buildings, vehicles, vessels, and equipment on Port-owned properties. Electrification is a primary strategy for achieving the Port's climate and clean air goals as outlined in the Maritime Climate and Clean Air Action Plan (MCAAP), Northwest Ports Clean Air Strategy (NWPCAS), and Century Agenda. The SWCES delivers technical, policy, and planning recommendations for how the Port and its partners should plan and implement the infrastructure needed to support a zero-emission maritime transition in Seattle by 2050. In 2021, the Port, NWSA and SCL entered a 10-year partnering agreement to support the joint planning and implementation of clean energy infrastructure, including development of the SWCES. This briefing provides an overview of the recently completed SWCES, recommendations, and next steps. BACKGROUND AND CONTEXT In the Pacific Northwest (PNW), access to affordable, low-carbon electricity is a key advantage to the electrification of buildings, vehicles, vessels and equipment. Electrification using the PNW's clean power can also significantly reduce air pollutant and greenhouse gas (GHG) emissions. Through the NWPCAS, the Ports of Seattle and Tacoma and NWSA adopted a shared vision to phase out seaport-related emissions by 2050. In 2021 and 2023 respectively, the Port of Seattle and NWSA accelerated goals for their own port-controlled operations, aiming to reach net zero greenhouse gas emissions by 2040. The City of Seattle similarly established targets essential to meeting global climate commitments, aiming to achieve carbon neutrality city-wide by 2050. Through the NWPCAS, infrastructure needed to support zero emissions equipment is identified as a central objective on the path to adoption of zero-emission operations across Northwest Template revised April 12, 2018. Page 173 of 373 COMMISSION AGENDA - Briefing Item No. 11b Meeting Date: April 22, 2025 Page 2 of 7 ports. Across the Seattle harbor, several thousand vehicles (including heavy-duty trucks, motorcoaches, ground transportation, and fleet vehicles), hundreds of pieces of equipment (including cargo handling and construction equipment), hundreds of vessel calls (including oceangoing and harbor vessels) and dozens of buildings demand a mix of energy sources, predominantly petroleum-based liquid fuels and natural gas. Together, these fossil fuels comprise approximately 78% of total onsite energy use. However, Seattle and the region are preparing for a significant transition to lower emission fuel sources. As the ports and their tenants transition to electrified options, the Port's infrastructure will need to be prepared to handle the additional electrical loads. The SWCES is specifically designed to address this need by bringing together industry and utility interests, analyzing current and projected power requirements, and providing a roadmap for the development of energy infrastructure. PARTNERING AGREEMENT WITH SCL AND NWSA Authorized in October of 2021, the Port, NWSA and SCL entered into a 10-year agreement to support the participation in and achievement of common goals around the SWCES. These include: • Planning jointly for the provision of clean energy, including the inventory, forecast, analysis, and identification of coordinated actions. • Working together through a designated representative from each organization to manage the Strategy and establish a collaborative and communicative platform for identifying and assessing alternatives, developing solutions, reaching decisions, and resolving disputes. • Developing measures so that the Strategy development, capital planning, and delivery processes run smoothly and without surprises to any other Party. • Coordinating related studies, plans, and projects, and sharing information, inputs, and outputs to facilitate the integration of the SWCES within broader objectives of each of the Parties. • Employing a holistic, integrated planning approach that addresses multiple sites, near term as well as planned demands, co-optimized infrastructure and end use investments, traditional infrastructure and non-wires solutions, and multi-party benefits and considerations (such as the utility, port, tenant, community, and industry). • Evaluating and pursuing innovative solutions for clean energy deployment including infrastructure planning, delivery, operational procedures, policies, financing, and business models. • Establishing a framework for and supporting ongoing coordination and implementation across the Parties. • Coordinating communications and stakeholder engagement activities. • Developing shared funding strategies to support and leverage clean energy investments. Template revised September 22, 2016. Page 174 of 373 COMMISSION AGENDA - Briefing Item No. 11b Meeting Date: April 22, 2025 Page 3 of 7 PLANNING PROCESS The SWCES was developed through an analytical process that considered Port-owned maritime properties along Seattle's Elliott Bay, the Duwamish River, the Lake Washington Ship Canal, and Shilshole Bay. This analysis included sites managed by the Maritime Division and NWSA and operated by the Port and private terminal operators. Large loads from adjacent properties were also considered. Interviews were conducted with the ports' lines of business and maritime industry tenants to provide insights into energy uses and operational requirements. A summary of the SWCES development process is outlined below: The SWCES analysis began with a site-by-site baseline analysis of 24 locations, at which, site operations, equipment, emissions, and fuel and energy uses were evaluated. This baseline provided a foundation for further investigation of a subset of 11 priority sites with high load growth potential, four locations expected to have significant, unique "spot loads," three potential truck charging locations, and four near-port sites selected by the utility. Forecasts of power demand were then developed to project peak power requirements through 2050. This forecast built upon the baseline inventories and considered operational projections, regulatory requirements, adopted port plans, and technology readiness, among other factors. The forecast was then used to assess constraints in Port's on-terminal power equipment and SCL's power distribution system. Traditional "poles and wires" utility investments as well as alternative, "non-wires" solutions (such as battery energy storage and onsite power generation) were evaluated as potential solutions to address infrastructure constraints. Finally, port and utility capital investment upgrades were identified, and strategic recommendations were developed to help manage risk, increase adoption of clean energy technologies, and provide a holistic approach to investment in port power infrastructure. KEY FINDINGS The SWCES provides insights into current and future energy use across Port-owned properties, as well as the on-terminal and utility-owned power infrastructure serving port facilities. Key findings from the analysis include:  Port power needs (peak electricity demand) are expected to increase four-fold by 2050. As fossil-fueled operations transition to electrification, power demand will increase Template revised September 22, 2016. Page 175 of 373 COMMISSION AGENDA - Briefing Item No. 11b Meeting Date: April 22, 2025 Page 4 of 7 substantially. Estimates of peak power use at key maritime facilities are modeled to more than quadruple from 53 megawatts in 2019 to over 225 megawatts by 2050.  Shore power continues to be the key driver of near-term power demand. Of the expected electrified end uses, shore power use by oceangoing vessels (OGVs) is by far the most significant driver of near-term demand. Charging of vehicles, vessels and equipment are expected to be drivers from 2035 and beyond.  Port-adjacent sites are significant contributors to SCL's load growth. Redevelopment at "near-port" sites (facilities sharing power distribution feeders with port locations), notably the United States Coast Guard (USCG) facility at Pier 36 and Washington State Ferry (WSF) terminal at Pier 52, are expected to contribute significantly to SCL distribution system constraints in the southern portion of the harbor.  Both SCL and Port electrical infrastructure will face constraints in the future. Of the 16 SCL distribution system feeders serving key maritime facilities, 10 are expected to exceed electrical capacity planning limits by 2040. In addition, multiple on-terminal Port substations will face capacity constraints, with eight sites expected to exceed total site capacity.  Traditional infrastructure solutions are currently most cost-effective. Traditional solutions such as improvements to substations, feeders and distribution lines are currently the more cost-effective than distributed, "non-wires" technologies such as battery energy storage systems in addressing the most significant power distribution bottlenecks. Technologies should continue to be reviewed over time and considered for deployment with cargo handling equipment, truck charging, resiliency needs, and other similar projects to mitigate intermittent loads and demand charges.  Long-term planning and resiliency gaps exist. Long-term plans and resiliency requirements for port operations and tenants are not currently well defined, which may limit more holistic investment strategies for individual sites. RECOMMENDATIONS - STRATEGIES FOR EXECUTION The SWCES identifies a series of Capital Investments to address capacity constraints along with a set of eight supportive Strategic Implementation Actions and a Strategy Implementation Framework. (1) Capital Investments Utility distribution system and site-level upgrades are needed to support electrification of port facilities and equipment. Approximately $208 to $457 million (2024 dollars) in port and utility investments have been identified through 2050, including an estimated $69 to $168 million in utility distribution system infrastructure costs and an estimated $139 to $288 million in port onsite transformer, switchgear, and substation equipment costs (More detail can be found in the strategy document in Table 5, page 21). Template revised September 22, 2016. Page 176 of 373 COMMISSION AGENDA - Briefing Item No. 11b Meeting Date: April 22, 2025 Page 5 of 7 Related support for planning and pre-design activities including infrastructure evaluation, site planning, tenant and contractor engagement, market assessment, securing tenant zeroemissions deployment commitments, and feasibility analyses will be important to prepare for initiation of future projects, particularly those involving higher levels of complexity and long leadtimes. Final investment decisions will need to be made after these deeper analyses are complete. Financing options and sequencing should be developed and evaluated with key partners and considered alongside other port funding priorities. (2) Strategic Implementation Actions Eight Strategic Actions (SA) to complement capital investments are recommended in the SWCES. These include:  SA1. Design for Future Electrification Capacity: Increase emphasis on prospective, "planned-capacity" improvements as a part of a shift from an incremental, project-byproject approach. Such a shift requires weighing potential risks of stranded assets and may not be practical in all cases. Monitoring and regular assessment of distribution system and on-terminal conditions, engagement with end-use stakeholders, modular designs, technology assessment, and complementary strategies to incent or require phased-in adoption of electrification technologies can help to mitigate risks.  SA2. Asset Condition Assessment: Assess port electrical asset conditions (e.g. age, equipment functionality, remaining useful life) and vulnerabilities (e.g. flooding and sea level rise, groundwater intrusion, seismic hazards) to further inform capital recommendations and prevent system failures. When combined with an evaluation of critical facilities for power resiliency (below), a more holistic view of electrical infrastructure needs and opportunities will be available to inform capital investments while enhancing project outcomes.  SA3. Identification of Critical Facilities for Resiliency: Assess port facility power resiliency requirements, including clear identification of critical facilities, utility hazard exposure and risk, minimum functional operational standards, and tenant requirements. A clear understanding of facility power resiliency requirements will help to refine site power distribution options, add value to distributed production and storage options, and assist with further prioritization of electrification infrastructure investments.  SA4. Integration with Site Master Planning: SWCES findings can help inform port master site development plans or specific site decarbonization plans that move study recommendations forward to pre-design and advanced project planning. Master site plans are needed to ensure compatibility between overlapping planning priorities at Port sites, including decarbonization, economic development, line of business needs, resiliency, and others. Such plans should use SWCES data to align strategic goals with site conditions to guide short and long-term development. Ideally, infrastructure, including Template revised September 22, 2016. Page 177 of 373 COMMISSION AGENDA - Briefing Item No. 11b Meeting Date: April 22, 2025 Page 6 of 7 power infrastructure, should provide for the achievement of overall site objectives and follow an integrated planning effort.  SA5. Infrastructure Management and Development: Consider options for enhancing management and development of shared infrastructure on port properties to enhance delivery of infrastructure improvements, manage asset conditions, and help ensure integrated designs meet overall site-wide plans and business goals.  SA6. Increase Grant Project Readiness: The Port, NWSA, SCL, and industry partners should use the SWCES results to assess and develop a suite of funding-ready capacity improvements and decarbonization projects. This may include utility distribution system assets (e.g. feeders, substations, transformers, switchgear, smart meters, utility-side storage, etc.), port on-terminal assets (e.g. port substations, solar panels, communications, duct banks, etc.), and electrification deployment projects (e.g. shore power, vessel charging, fleets and equipment, building electrification, etc.). Establishing funding-readiness will allow project partners to more effectively consider external funding opportunities to help offset the significant costs of upgrades. Careful attention should be made to grant requirements to avoid additional costs, time delays and overall risk.  SA7. Clean Technology Development: Apply an innovation-focused maritime decarbonization lens that encourages assessment and trial of new concepts and technologies to improve services and help spur electrification technology deployment. The Port can leverage its concentration of heavy-duty transportation end-uses, diverse array of properties, high visibility, non-governmental organization (NGO) partnerships, ambitious emissions reduction targets, and economic development mission to support pilot projects, new business models, and industry partnerships.  SA8. Innovative Business Models and Financial Strategies: Evaluate as-a-service, elective pay, innovative rate models, and port Special Purpose District authorities to reduce financial barriers, recover costs, and support or accelerate adoption of clean energy technologies and end uses. (3) Strategy Implementation Framework The SWCES recommends a Joint Port-Utility Implementation Framework to help drive ongoing implementation. In accordance with the 2021 Partnering Agreement between the Port, SCL, and NWSA, the parties agreed to develop an implementation framework to guide ongoing implementation of the SWCES. This framework lays out capital and end-use deployment workstreams for ongoing planning and coordination. It will allow the parties to plan for and coordinate timely delivery of capital projects, assess the pace of technology deployment, support deployment of electrified equipment, and make necessary adjustments. Included should be longlead project planning items such as new utility substations or major transmission line extensions and significant changes in on-terminal energy needs. Template revised September 22, 2016. Page 178 of 373 COMMISSION AGENDA - Briefing Item No. 11b Meeting Date: April 22, 2025 Page 7 of 7 NEXT STEPS With the completion of the Seattle Waterfront Clean Energy Strategy, staff from the Port, NWSA and Seattle City Light expect to proceed with implementation activities. Initially, these activities are expected to include: (1) (2) (3) (4) Public engagement on the SWCES and related projects. Briefing the NWSA Managing Members Environmental Working Group Review of near-term projects for inclusion in Port, NWSA, and SCL Capital Improvement Plans (CIPs). Site power master planning starting at selected sites. ATTACHMENTS TO THIS BRIEFING (1) (2) (3) Seattle Waterfront Clean Energy Strategy Partnering Agreement Presentation slides PREVIOUS COMMISSION ACTIONS OR BRIEFINGS Sustainability, Energy, and Climate Committee (SEAC) updates: February 2025, June 2024, May 2023, December 2022, May 2022 Template revised September 22, 2016. Page 179 of 373 Item No. 11b attach-1 Meeting Date: April 22, 2025 SEATTLE WATERFRONT CLEAN ENERGY STRATEGY A roadmap for power infrastructure to support electrification of buildings, vehicles, vessels and equipment on Port-owned properties in the Seattle Harbor Page 180 of 373 DETAIL FROM THE SALISH WELCOME FIGURES AT SMITH COVE CRUISE TERMINAL, COMMISSIONED AND CREATED BY NORTHWEST CARVER AND ARTIST ANDREA WILBUR-SIGO (SQUAXIN ISLAND AND SKOKOMISH) The Port of Seattle exists on Indigenous land. We acknowledge the ancestral homelands of those who walked here before us and those who still walk here, keeping in mind the integrity of this territory where Native peoples identify as the Duwamish, Suquamish, Snoqualmie, and Puyallup, as well as the tribes of the Muckleshoot, Tulalip, other Coast Salish peoples, and their descendants. We are grateful to respectfully live and work as guests on these lands with the Coast Salish and Native people who call this home. This land acknowledgment is one small act in the ongoing process of working to be in good relationship with the land and the people of the land. Publication Date Version 1.0, February 2025 Page 181 of 373 GLOSSARY Decarbonization: The process of reducing or eliminating carbon dioxide (CO₂) and other greenhouse gas emissions associated with energy production, consumption, and industrial activities. Distribution system: The utility infrastructure designed to deliver power from the high-voltage utility transmission system to Port facilities. Includes utility substations, feeders, switchgear, and transformers. End use: Vehicles, vessels, buildings, and equipment that are expected to ultimately consume electricity within the Port's ecosystem and rely on Port and utility electrical infrastructure. These include, but are not limited to electric vehicles, electric cargo handling equipment, charging and shore power for vessels, building heating and ventilation systems, and other electrified uses. Feeder: A high-capacity power line or cable (conductor) that transmits electricity from a substation or distribution point to a specific area, network, or set of loads. In the context of this study, feeders are Seattle City Light-owned assets that serve one or more Port facilities and may also serve non-Port loads. Ground transport: Refers to transportation to, from and between Port properties. This category primarily includes buses (shuttle buses and motor coaches) used to transport cruise passengers to and from cruise terminals. Non-wires technology: Innovative solutions that reduce the need for traditional infrastructure such as new power lines or substations by leveraging distributed energy resources. These include energy storage systems, distributed generation (e.g. solar panels), demand response, energy efficiency, and microgrids. Ocean-going vessels (OGVs): Large vessels that transit long distances, often engaging in intercontinental or international trade or transport. Includes cargo vessels (container ships, bulk carriers, and tankers), cruise ships, roll-on roll-off (RoRo) vessels, and other vessel types. OpEx: Refers to operating expenditures, the ongoing expenses associated with the maintenance and operation of assets that are in place. Peak demand: The highest level of electrical power consumption recorded over a specific period, typically during times of maximum usage, such as certain seasons or hours of the day. Managing peak demand is critical for ensuring grid reliability, minimizing costs, and optimizing infrastructure. Peak shaving: The practice of reducing power consumption during periods of peak demand on the electrical distribution system. May be achieved using strategies such as energy storage systems, shifting energy-intensive activities to off-peak times, curtailing uses, or on-site generation. Peak shaving helps to reduce energy costs, minimize strain on electrical infrastructure, and improve grid reliability. Page 182 of 373 Port substation: Specialized port-owned electrical equipment located at a Port facility that manages the distribution of electricity to support port operations including cranes, cargo handling equipment, refrigeration units, shore power, buildings, lighting, equipment and other electrical needs. Utility substation: A utility-owned facility within the electrical power distribution system that steps down and distributes high-voltage electricity from the high-voltage transmission system to local distribution networks and end users. ACRONYMS BESS Battery Electric Storage System MW Megawatt CHE Cargo-handling Equipment NWSA Northwest Seaport Alliance CIP Capital Improvement Program OGVs Ocean-going Vessels CO2e Carbon Dioxide Equivalent SCL Seattle City Light EV Electric Vehicle SWCES GHG Greenhouse Gas Seattle Waterfront Clean Energy Strategy kW Kilowatt TRU Transport Refrigeration Unit USCG United States Coast Guard NCL Bliss departs Seattle | October 2024 Page 183 of 373 EXECUTIVE SUMMARY Page 184 of 373 EXECUTIVE SUMMARY In the Pacific Northwest, access to clean (low carbon), reliable electricity is a key advantage that enables electrification of transportation and buildings and supports reductions in both greenhouse gas and air pollutant emissions. Electrification is a keystone strategy to address climate change and alleviate environmental burdens for neighborhoods and sensitive populations that live near industrial areas and concentrations of transportation activity. For the Port of Seattle and The Northwest Seaport Alliance (NWSA), electrification is also a core strategy to achieve the shared vision of phasing out seaport-related emissions by 2050. However, the electrification of maritime industry operations will require significant, concerted, and proactive investment in the energy infrastructure serving port-owned facilities. The Port of Seattle (the Port) and its partners are well-positioned to simultaneously advance key carbon- and air pollution-reduction technologies while enhancing services to customers. The Port owns and operates maritime properties in the Seattle harbor including two home port cruise terminals with three cruise vessel berths. The NWSA is a vital operating partner managing the Port's largest properties and the seventh largest cargo gateway in the United States. Seattle City Light (SCL) is the public electric utility serving the greater Seattle area and is a recognized leader in clean energy and the nation's first carbon neutral electric utility. The Port, NWSA, and SCL came together to initiate a first-of-its-kind joint infrastructure planning process: the Seattle Waterfront Clean Energy Strategy (SWCES). Given the significant challenges presented by decarbonization of port operations - including long lead times for construction, high costs of electrical infrastructure projects, and rapidly evolving maritime and clean energy technologies - the SWCES recognizes the need to work collaboratively with government and industry partners to address infrastructure constraints to achieve shared decarbonization goals. The purpose of the Seattle Waterfront Clean Energy Strategy is to proactively develop the enabling clean energy infrastructure required to electrify vehicles, vessels, rail, equipment, buildings and other end uses at Port and NWSA facilities. The SWCES takes a holistic approach to forecast future electrification demand from major maritime uses along the Seattle waterfront, assess power infrastructure constraints, identify capital investments, recommend strategic actions, and establish a framework for ongoing implementation between the Port and SCL. The SWCES is a roadmap for the decarbonization of a significant segment of port-related maritime operations and identifies 33 capital projects and eight strategic actions for implementation. It is important to note, however, that there remains significant uncertainty in key aspects underlying this strategy and the broader energy transition in which this work is situated, including: • • • The timing and sequencing of electrification loads The pace of technology development, cost-competitiveness, and commercial availability of both electrified end-use applications and non-wires solutions, such as battery storage The pace and magnitude of adjacent non-port electrification load growth and Executive Summary | 1 Page 185 of 373 • Realities of financing capacity, availability of grants and incentives, regulatory requirements, and overall risk tolerance of maritime business partners Accordingly, the SWCES uses a blended approach that combines specific plans for capital investment with a set of strategic implementation actions intended to increase implementation effectiveness and reduce uncertainty. Development of the SWCES included creation of an electrical load forecast across key port and adjacent properties and an analysis of the ability of existing infrastructure to accommodate those future loads. Key findings of the analysis include: • Port power needs (peak electricity demand) is expected to increase four-fold by 2050. As of 2019, 74% of total port-wide energy use was in the form of fossil-based liquid fuels. As fossil-fueled operations transition to electrification, power demand will increase substantially. Estimates of peak power use at key maritime facilities in the Seattle harbor are modeled to more than quadruple from 53 megawatts in 2019 to over 225 megawatts by 2050. • Shore power continues to be the key driver of near-term power demand. Of the expected electrified end uses, shore power use by oceangoing vessels (OGVs) is by far the most significant driver of near-term demand. Charging of vehicles, vessels and equipment are expected to be drivers from 2035 and beyond while also introducing more short duration peak loads. • Port-adjacent sites are significant contributors to SCL's load growth. Redevelopment at "near-port" sites (facilities sharing power distribution feeders with port locations), notably the United States Coast Guard (USCG) facility at Pier 36 and Washington State Ferry (WSF) terminal at Pier 52, are expected to contribute significantly to SCL distribution system constraints, particularly in the southern portion of the harbor. • Both SCL and Port electrical infrastructure will face constraints in the future. Of the 16 SCL distribution system feeders serving key maritime facilities, 10 are expected to exceed their electrical capacity planning limits by 2040. In addition, multiple onterminal Port substations will face capacity constraints, with eight sites expected to exceed total site capacity through the forecasted timeframe. • Traditional infrastructure solutions are currently most cost-effective. Traditional solutions such as improvements to substations, feeders and distribution lines are currently more cost-effective than distributed, "non-wires" technologies such as battery energy storage systems in addressing the most significant power distribution bottlenecks. The high costs of non-wires technologies to address significant, longer duration loads are presently prohibitive. Technologies should continue to be reviewed over time and considered for smaller scale deployment at cargo handling equipment, truck charging, and other similar projects to mitigate intermittent loads and demand charges. • Long-term planning and resiliency gaps exist. Long-term plans and resiliency requirements for port operations and tenants are not currently well defined, which may limit more holistic investment strategies for individual sites. Based on these findings, the following implementation actions are recommended: Executive Summary | 2 Page 186 of 373 • Incorporate high priority capacity improvements into port and SCL capital improvement plans (CIPs). Approximately $208 to $457 million (2024 dollars) in port and utility investments have been identified through 2050, including $139 to $288 million in port investments and $69 to $168 million in utility investments. Related support for planning and pre-design activities including infrastructure evaluation, site planning, tenant and contractor engagement, market assessment, securing tenant zero-emissions deployment commitments, and feasibility analyses will be important to prepare for initiation of future projects, particularly those involving higher levels of complexity and long lead-times. Final investment decisions will need to be made after these deeper analyses are complete. Financing options and sequencing should be developed and evaluated with key partners and considered alongside other port funding priorities. • Increase emphasis on prospective, "planned-capacity" improvements as a part of a shift from an incremental, project-by-project approach. Such a shift requires weighing potential risks of stranded assets and may not be practical in all cases. Monitoring and regular assessment of distribution system and on-terminal conditions, intentional engagement with end-use stakeholders, modular design, technology assessment, and complementary strategies to incent or require phased-in adoption of electrification technologies can help to mitigate risks. • Establish a Joint Port-Utility Implementation Framework to drive ongoing implementation. In accordance with the 2021 Partnering Agreement between the Port, SCL, and NWSA, the parties agreed to develop an implementation framework to guide ongoing implementation of the SWCES. This framework lays out implementation workstreams and a schedule for ongoing planning, coordination and adjustment. It will allow the parties to plan for timely delivery of capital projects, assess the pace of technology deployment, support deployment of electrified equipment, and make necessary adjustments. Included should be long-lead project planning items such as new utility substations or major transmission line extensions. • Develop funding-ready projects. The Port, NWSA, SCL, and industry partners should use the SWCES results to assess and develop a suite of funding-ready capacity improvements and decarbonization projects. This may include utility distribution system assets (e.g. feeders, substations, transformers, switchgear, smart meters, utility-side storage, etc.), port on-terminal assets (e.g. port substations, solar panels, communications, duct banks, etc.), and electrification deployment projects (e.g. shore power, vessel charging, fleets and equipment, building electrification, etc.). Establishing funding-readiness will allow project partners to more effectively consider external funding opportunities to help offset the significant costs of upgrades. Careful attention should be made to grant requirements to avoid additional costs, time delays and overall risk. • Use the SWCES findings to inform port master site development plans or specific site decarbonization plans that move study recommendations forward to pre-design and advanced project planning. Master site plans are needed to ensure compatibility between the overlapping planning priorities at Port sites, including decarbonization, economic development, line of business needs, resiliency, and others. Such plans should use SWCES data to align strategic goals with site conditions to guide short and long-term development. Ideally, infrastructure, including power infrastructure, should provide for the achievement of overall site objectives and follow an integrated planning effort. Executive Summary | 3 Page 187 of 373 • Assess port facility power resiliency requirements, including clear identification of critical facilities, utility hazard exposure and risk, minimum functional operational standards, and tenant requirements. A clear understanding of facility power resiliency requirements will help to refine site power distribution options, add value to distributed production and storage options, and assist with further prioritization of electrification infrastructure investments. • Apply an innovation-focused maritime decarbonization lens that encourages assessment and trial of new concepts and technologies to improve services and help spur electrification technology deployment. The Port can leverage its concentration of heavy-duty transportation end-uses, diverse array of properties, high visibility, nongovernmental organization (NGO) partnerships, ambitious emissions reduction targets, and economic development mission to support pilot projects, new business models, and industry partnerships. • Assess port electrical asset conditions (e.g. age, equipment functionality) and vulnerabilities (e.g. flooding and sea level rise, groundwater intrusion, seismic hazards) to further inform capital improvement recommendations and prevent system failures. When combined with an evaluation of critical facilities for power resiliency, a more holistic view of electrical infrastructure needs and opportunities will be available to inform capital investments and project schedules, while enhancing project outcomes. • Consider options for enhancing management and development of shared infrastructure on port properties. Providing for ownership responsibility for shared infrastructure can help to enhance delivery of infrastructure improvements, manage asset conditions, and help ensure integrated designs which meet overall site-wide plans and business goals. With the completion of the Seattle Waterfront Clean Energy Strategy, the Port, NWSA, and SCL are poised for action to advance a triple-bottom line mission and drive decarbonization of the region's maritime industry while prioritizing environmental justice and increasing economic opportunity in the region. Successful implementation will require significant levels of effort and valuable capital resources. Effective, dedicated leadership, ongoing coordination, innovation, and implementation of strategic actions will be vital to reduce risks, increase competitiveness for external funding, prioritize capital investments, and provide a holistic view of infrastructure investment benefits. NCL Bliss Plugging into Shore Power at Bell Harbor Cruise Terminal | October 2024 Executive Summary | 4 Page 188 of 373 TABLE OF CONTENTS Introduction and Context ........................................................................................................ 1 The Port of Seattle and Northwest Seaport Alliance ............................................................. 1 Seattle City Light ................................................................................................................ 1 Joint Planning for Clean Energy .......................................................................................... 2 Environmental Justice......................................................................................................... 4 Strategy Development ............................................................................................................ 5 Key Findings and Insights ...................................................................................................... 8 Baseline Analysis ............................................................................................................... 8 Load Forecast .................................................................................................................... 9 Forecast Results by End Use......................................................................................... 10 Forecast Results by Site................................................................................................ 11 Infrastructure Constraints Analysis .................................................................................... 13 Constraints on Seattle City Light's Infrastructure............................................................. 13 Constraints on Port of Seattle and NWSA Infrastructure.................................................. 14 Alternatives Analysis ("Non-Wires" Solutions) .................................................................... 17 "Non-Wires" Technology Alternatives: Areas for Ongoing Study ...................................... 18 Strategies for Execution ....................................................................................................... 19 Capital Investments at the Port, NWSA, and SCL .............................................................. 20 Strategic Implementation Actions ...................................................................................... 26 Design for Future Electrification Capacity ....................................................................... 26 Asset Condition Assessment ......................................................................................... 26 Identification of Critical Facilities for Resiliency ............................................................... 26 Integration with Site Master Planning ............................................................................. 27 Infrastructure Management and Development ................................................................ 28 Increase Grant Project Readiness.................................................................................. 28 Clean Technology Development .................................................................................... 28 Innovative Business Models and Financial Strategies..................................................... 30 Preparing for Deployment: Joint Strategy Implementation Framework ................................ 32 Conclusions and Next Steps................................................................................................. 35 Appendices.......................................................................................................................... 36 Appendix A - Policies and Targets Informing the Seattle Waterfront Clean Energy Strategy 37 Appendix B: Expected Barriers to End-Use Electrification................................................... 41 Page 189 of 373 INTRODUCTION AND CONTEXT Through the Northwest Ports Clean Air Strategy1 the Ports of Seattle and Tacoma and The Northwest Seaport Alliance (NWSA) adopted a shared vision to phase out seaport-related emissions by 2050. In 2021 and 2023, the ports accelerated goals for their own port-controlled operations, aiming to reach net zero greenhouse gas emissions by 2040. The City of Seattle similarly established targets essential to meeting global climate commitments, aiming to achieve carbon neutrality city-wide by 2050. The Port of Seattle and Northwest Seaport Alliance The Port of Seattle (referred to herein as "the Port") is a highly diversified seaport, encompassing several maritime lines of business with varying operational and energy use profiles. The Port is a key gateway to the Alaskan market, with the largest cruise port on the U.S. West Coast and home to the North Pacific fishing fleet. The Port's maritime lines of business also include a grain terminal, recreational marinas, and commercial and industrial real estate properties. The NWSA provides a vital joint cargo operating partnership between the Ports of Seattle and Tacoma, comprising the seventh largest container gateway in North America. As the licensed operator of Port cargo terminals in the Seattle Harbor, the NWSA is a key partner in the Port's electrification efforts. Importantly, more than 94% of the ports' maritime emissions are outside of their direct operational control. These emissions sources include oceangoing and harbor vessels, locomotives, trucks, ground transportation, and cargo handling equipment that are privately owned, but operate on and around Port properties. The remaining emissions that fall under the ports' direct control stem largely from the Port's maritime and economic development operations, which includes Port-owned buildings, fleet vehicles and equipment, and activities such as employee commuting, waste management, and staff business travel. The Port and NWSA (collectively referred to as "ports") work closely with their tenants and customers in joint planning, coordination of operations, and deploying capital improvement projects on their properties. Moving forward, the SWCES will be a key tool to provide the Port, NWSA, and SCL with information that can be used to plan and deploy clean energy improvements to support tenant and customer needs. Seattle City Light Seattle City Light (SCL) is a municipal power utility serving nearly 700,000 residents including the City of Seattle and several adjoining jurisdictions. To serve these customers, SCL owns, maintains, and operates a multi-billion-dollar generation, transmission, and distribution system. This includes: • • 14 major substations and more than 2,500 miles of overhead and underground utility wiring Seven hydroelectric plants on the Skagit, Cedar, Tolt, and Pend Oreille Rivers with a combined capacity of almost 2,000 megawatts 1 The Northwest Ports Clean Air Strategy is a collaboration between the Ports of Seattle and Tacoma, Vancouver- Fraser Port Authority in British Columbia, and Northwest Seaport Alliance to voluntarily reduce seaport-related emissions that contribute to air pollution in the shared Puget Sound-Georgia Basin and global climate change. Seattle Waterfront Clean Energy Strategy |1 Page 190 of 373 • • • 650 miles of high-voltage transmission lines A state-of-the-art System Control Center Billing and metering equipment for more than 375,000 accounts. Figure 1: SCL 2022 Power Generation Sources SCL's power generation mix is shown in Figure 1.2 Over 80% of the power that SCL delivers is generated from carbon-free hydroelectricity. The remaining power is generated from a mix of power sources purchased from the Bonneville Power Administration (BPA) and other renewable sources. In total, approximately 95% of SCL's overall energy mix comes from non-emitting sources as of 2022. The balance of emissions is offset, creating a carbon-neutral utility - the first of its kind in the United States. In the Pacific Northwest, electricity from established hydropower facilities is inexpensive relative to other regions and supports SCL's ability to provide lower cost energy to end users Joint Planning for Clean Energy Port operations currently run primarily on liquid fossil fuels (primarily gasoline, diesel, and bunker fuel). To achieve their collective decarbonization goals, the ports must transition operations to non-fossil forms of energy. This will require electrification of vessels, vehicles, and equipment where feasible, as well as maximizing the use of shore power for oceangoing vessels. Transitioning these operations will create unprecedented demands for power, creating the need for a joint planning framework to support electrification. The SWCES charts a long-term course of action to establish the enabling clean energy infrastructure necessary for the decarbonization and phase-out of emissions from the maritime industry operating at Port-owned properties. The Port and collaborating partners SCL and NWSA, have developed the SWCES as a strategic initiative to further advance the region's interrelated climate, equity, and economic development goals. Seattle Waterfront This groundbreaking collaboration Clean Energy Strategy recognizes the unique roles of the ports and Partners Vision: the City and seeks to leverage expertise, A lasting partnership deploying clean energy establish a new joint implementation infrastructure and driving equitable economic strategy, and together prepare for the development for a zero-emissions working significant load growth expected with waterfront by 2050. electrification. This once-in-a-generation transition from fossil liquid fuels to 2 Footnotes to Figure 1: 1 This fuel represents a portion of the power purchased from BPA. 2 SCL does not have coal or natural gas resources in its power supply portfolio. It does make market purchases to balance or match its loads and resources. These purchases, along with market purchases made by BPA, may incidentally include coal or natural gas resources, which are assigned to the utility. Any emissions associated with unspecified market purchases are offset through our GHG neutrality policy. Seattle Waterfront Clean Energy Strategy |2 Page 191 of 373 electrification and other low carbon technologies involves significant uncertainty in the timing, magnitude and characteristics of new loads and represents an important opportunity to strategically guide investments. The SWCES considers elements of existing plans deployed by the ports and SCL, and serves as an important holistic, cross-sector strategy to ensure sufficient power is available to enable the transition to zero emissions operations along Seattle's waterfront. Figure 2: Plans Supported by the SWCES Northwest Ports Clean Air Strategy Vision to be zeroemission by 2050 with objectives shared by Northwest Ports Overarching policy frameworks Seattle City Light Strategic Plan : Sets Seattle City Light's strategic priorities Implementation & investment plans Waterfront Clean Energy Strategic Plan Port of Seattle and NWSA Implementation Plans Seattle City Light Transportation Electrification SIP: Prioritizes investments in transportation electrification Projects and programs to support zero emission transition To facilitate the successful development and implementation of the SWCES, the project partners entered into a Partnering Agreement in October 2021 to memorialize the shared ambition for a clean energy future. In a joint Vision Statement, the partners established specific guiding principles for joint planning, innovation, cooperation, and implementation: • • • • Achieve carbon neutrality and zero emissions by 2050 Lead with equity Foster economic growth Support and drive workforce development Collectively, these ambitions serve as high-level goals to drive the execution of projects, initiatives, and follow-on studies. Seattle Waterfront Clean Energy Strategy |3 Page 192 of 373 Environmental Justice In addition to identifying the infrastructure pathways to support maritime decarbonization, the SWCES also addresses persistent environmental justice concerns for those living adjacent to industrial areas. Communities located in the vicinity of the ports are disproportionately exposed to air pollution and other environmental factors, with criteria air pollutant emissions - such as those resulting from diesel combustion - a particular concern. The region meets federal air quality standards, but even as vehicle engines become cleaner and more efficient, diesel exhaust from transportation activity (including ships, trains, and trucks) remains a source of air pollution in the Puget Sound. People living in several of the communities surrounding industrial South Seattle experience economic and health disparities. In communities in the Duwamish Valley for instance (specifically South Park and Georgetown) residents have been shown to have a 13-year difference in life expectancy and a more than two-fold higher incidence of heart disease as compared to other, wealthier areas of Seattle. 3 More effective and deliberate actions and investments are needed to address both the health and economic inequities and to counteract environmental injustices impacting these residents. Figure 3. 3:Ranking Rankingofofdiesel diesel pollution Figure pollution impact impact on tracts census tracts surrounding on census surrounding port facilities. Source: Washington Tracking NetworkTracking Health port facilities. Source: Washington In 2019, the Port established a Duwamish Valley Port Disparities - Diesel Pollution- & Disproportionate Network Health Disparities Diesel Pollution & Community Action Team (PCAT) and adopted a Duwamish Impact Index Disproportionate Impact Index Valley Community Benefits Commitment to build capacity for ongoing collaboration, advancement of environmental and community health, and fostering economic prosperity in-place. Similarly, the City of Seattle adopted a Green New Deal Resolution in 2019, and the Port established a Workforce Development policy in 2020, both designed to advance equitable workforce development with an emphasis on expanding opportunities to disproportionately impacted communities. The SWCES builds upon these policies and other efforts to increase investment and reduce environmental health disparities. The SWCES will facilitate the deployment of low and zero emissions equipment and contribute to the reduction of pollution exposure in neighboring communities. 3 See: Gould L, Cummings BJ. Duwamish Valley Cumulative Health Impacts Analysis. Seattle, WA: Just Health Action and Duwamish River Cleanup Coalition/Technical Advisory Group. March 2013. https://www.drcc.org/s/CHIA_low_res-report.pdf Seattle Waterfront Clean Energy Strategy |4 Page 193 of 373 Strategy Development The Port owns 24 properties along Seattle's Elliott Bay, the Duwamish River, the Lake Washington Ship Canal, and Shilshole Bay (see map in Figure 3). These sites are managed by a combination of the Port's Maritime Division and the NWSA, and are operated by the Port as well as a variety of private sector entities through lease arrangements. The uses and operational profiles of these properties varies widely and includes maritime, industrial, commercial and recreational uses. The SWCES took a site-by-site approach to evaluate the different operations at each location. The overall strategy development process included six steps: Baseline Analysis, Forecast, Constraints Analysis, Alternatives Analysis, Capital Upgrades, and Implementation Plan. Each of these steps in summarized in the following sections. Figure 4: SWCES Development Process Baseline Analysis A detailed inventory of end uses was evaluated on a site-by-site basis. This inventory considered aspects such as equipment quantities, end-use equipment types and age, building and site information, fuel use, operational characteristics, and gas and power data. This approach was intended to capture the site-specific energy uses across the ports' varied facilities and was used as a foundation for analysis. The baseline analysis focused on 2019 energy usage4 and emissions and quantified current energy end-uses and emissions production. Sites were then prioritized for further analysis based on total emissions contributions, known electrical infrastructure capacity (or in limited cases, condition) issues, expected development plans, and load growth potential. Of the initial 24 sites considered under the SWCES, a subset was identified for further levels of analysis, organized in four categories: • • 11 Priority sites: Eleven sites were prioritized for detailed analysis 4 Spot-load sites: Four locations were identified where underlying site conditions were expected to remain relatively stable but where significant increases from specific, intermittent electrified end use "spot loads" were expected. These spot load end uses included switcher locomotives, tugboats, and passenger ferries 4 The 2019 baseline year was selected to minimize data irregularities associated with non-typical port operations during Covid, the timing of the technical analysis, and the availability of data from multiple sources including power, natural gas, fueling, and fleet equipment inventories. Known projects in planning stages, such as Pier 66 shore power, were taken into consideration in the forecast analysis. Seattle Waterfront Clean Energy Strategy |5 Page 194 of 373 • • 3 Truck charging sites: Three sites were considered for heavy-duty truck charging loads under a truck charging depot scenario 4 Near-port sites: Four industrial and transportation sites close to port properties were identified based on potential impact on load forecasts and constraints analyses in subsequent steps. These sites included Vigor Shipyards, the United States Coast Guard Base (USCG), Pier 50, and Colman Dock Figure 5: Map of Priority and Spot Load sites Forecast Analysis Forecasts of power demand were developed using a bottom-up approach based on electrification of end uses, planned development, fleet turnover, business operational activity projections, regulations, and policy targets. Modeling was developed for tug, passenger ferry, and rail spot load deployments as well as three heavy duty drayage truck charging locations. Policy targets included state and local mandates such as laws for electric vehicle sales and building performance, as well as port targets in strategy documents such as shore power development and fleet electrification (for a list of regulations and policy targets considered, see Appendix A). Interviews were conducted with operators at port and near-port sites to help identify aspects such as operational patterns, anticipated load increases and timing, potential charging schedules, and additional equipment information. Four future load scenarios were developed to show a range of potential future outcomes: business-as-usual (BAU), low, medium, and high. The BAU scenario forecasted power demand assuming current operational conditions and plans, and adherence to existing energy use and emissions-related regulations. The low, medium and high scenarios included assumptions Seattle Waterfront Clean Energy Strategy |6 Page 195 of 373 within a variety of categories including operational activity levels, electric equipment adoption, energy demand, cargo throughput, and shore power availability. Constraints Analysis The forecasts were then compared against SCL's distribution system and load planning models, transformer capacity at the specific sites, and the Port's on-terminal substation infrastructure. This analysis identified constraints at the distribution system level, for each site as a whole, and for specific on-terminal equipment. Figure 6: Power Distribution System Alternatives Analysis Four of the sites with the most significant distribution system constraints were selected for further exploration of "non-wires" alternative solutions-including energy storage, distributed generation, and hydrogen technologies-to address constraints instead of traditional upgrades to the capacity of existing infrastructure. For each of the four sites, the analysis made recommendations related to the feasibility and cost-effectiveness of alternative solutions and strategies for future study. Seattle Waterfront Clean Energy Strategy |7 Page 196 of 373 Capital Projects The results of the analysis allowed the partners to identify the capital upgrades necessary on both port facilities and within the utility's power distribution system. These include initial recommendations for the timing of infrastructure upgrades.5 Implementation Strategy The final step in the process was the development of implementation recommendations including infrastructure improvements, supporting actions, areas for further evaluation, and an implementation framework. KEY FINDINGS AND INSIGHTS Baseline Analysis The Baseline Analysis determined that 74% of port-wide onsite6 energy use was in the form of liquid fuels including diesel, gasoline, and fuel oil in 2019 (the baseline year). Combined, these fuels produce over 93% of port GHG emissions. Electricity represents just 22% of onsite energy use and 3% of GHG emissions7, with natural gas representing approximately 4% of energy use and 4% of GHG emissions. Figure 7: 2019 Port-wide Onsite Energy Use by Fuel Type (MMBtu) Electricity 22% Figure 8: 2019 Port-wide Onsite CO2e Emissions by Fuel Type (tonnes) Electricity 3% Natural Gas 4% Natural Gas 4% Liquid Fuels 74% Liquid Fuels 93% From an energy end-use perspective, vessels at berth and cargo handling equipment account for more than 86% of liquid fuel energy use and 85% of CO2 emissions, followed by on-terminal 5 The SWCES is intended to provide for the implementation of two overarching plans, the NW Ports Clean Air Strategy and Maritime Climate and Air Action Plan, both of which underwent environmental review with the Port of Seattle (2021-02 and 2021-07, respectively). Similarly, any capital projects identified herein are expected to go through appropriate environmental review and permitting as projects are further vetted and approved. 6 The SWCES focuses on site-based energy use. Accordingly, the baseline and forecast do not include transportation activity off terminal (such as cruise passenger travel, truck travel to warehouse or other facilities, tenant commuting, and offsite ground transportation) or fuel use by vessels when not at berth. 7 SCL uses carbon offsets to address the carbon emitting portions of its electricity generation fuel mix. However, the ports' carbon accounting protocols for purchases of electricity do not consider carbon offsets, which results in a small portion of electricity-associated emissions. Seattle Waterfront Clean Energy Strategy |8 Page 197 of 373 trucking, fleet vehicles, and other end-uses. Key electricity uses include building heating and cooling, lighting, ship-to-shore cranes, shore power, refrigeration plugs, and cold storage. The predominant use of natural gas is for space and water heating. At a site level, electrical energy use varies dramatically, both in magnitude and pattern of energy usage. Sites such as Fishermen's Terminal show electrical energy consumption within a relatively narrow range on a year-round basis, reflecting stable operations dominated by building energy use, with additional seasonal loads from fishing vessels at berth, while sites such as Terminal 91 show a consistent baseload marked by large, intermittent peaks, reflecting cruise shore power energy use (see Figure 10). Figure 9: Liquid Fuel CO2e Emissions by End-Use Type 60% 56% 50% 40% 30% 30% 20% 13% 10% 0% 1% Vessels Fleet Cargo Trucking Vehicles Handling (onterminal) 0.3% Other Figure 10: Annual Energy Use Profile at Fishermen's Terminal and Terminal 91 Load Forecast The SWCES load forecast provides valuable insight into future power demand conditions for the ports and SCL. The forecast estimates an increase in peak demand at port sites from a base of 53 megawatts (MW) in 2019 to more than 224 MW in 2050, representing more than 4x increase in load growth. When including the near-port sites considered in the forecast, this figure rises to 296 MW in 2050. A range of 262 to 324 MW is seen across the low to high scenarios, respectively (Figure 11). Overall, the forecasted load scenarios show little variation in the near term because planned shore power additions and building redevelopment and upgrades are anticipated across the board in all scenarios. Only limited electrification of cargo handling equipment, trucks, or other equipment is expected in the initial years of the forecast. However, from 2035 onward, the gap between low and high load scenarios begins to grow, driven by increased cargo handling Seattle Waterfront Clean Energy Strategy |9 Page 198 of 373 equipment and fleet vehicle electrification over time, as well as modeled differences in public charging infrastructure, cargo activity growth, and treatment of spot loads at specific sites. Notably, underlying Business as Usual (BAU) load growth is significant, reflecting the expected impacts of state mandates driving electrification of fleet vehicles, heavy duty trucks, and buildings. Figure 11: Forecasted Peak Demand to 2050, All Scenarios 350,000 Peak Demand (kW) 300,000 250,000 High 200,000 Medium 150,000 Low BAU 100,000 50,000 0 2025 2030 2035 2040 2050 The medium load scenario is used for planning purposes, reflecting implementation of statelevel policies, port strategy targets, stable but growing operational activity, and rapid deployment of electrification technologies. The scenario assumes deployment of shore power across all cruise, international container, and commercial fishing terminals as well as electrification of vehicles at a rate higher than state mandates for zero-emissions vehicle sales. Key differences in the medium and high forecast include: the number, size, and type of truck charging locations deployed; the pace of electrified CHE deployment; quantities of public EV charging; the forecasted rate of growth of cargo throughput; numbers of electrified vessels and locomotives at spot load sites; and the level of assumed alternative fuel technology deployment (such as renewable fuels and hydrogen fuel cell technologies). Forecast Results by End Use The load forecast analysis shows how end-use load contributions may change over time in response to variables like increased business and operational activity, electrification of multiple end-uses, and the addition of large prospective spot loads such as passenger ferry, tug, or heavy-duty truck charging (Figure 12). The load forecast also considered daytime and nighttime operations and potential timing of peak loads. Shore power provides the largest overall contribution to peak demand, with cruise terminals driving most near-term peak loads. Shore power additions at cargo sites (Terminals 5, 18, 25/30, and 46) and, importantly, redevelopment at near-port sites such as the USCG facility at Pier 36, are expected to significantly increase loads on SCL feeders serving port locations in the medium- and long-term. Seattle Waterfront Clean Energy Strategy |10 Page 199 of 373 Figure 12: Forecasted Loads by End-use Electrification of cargo handling equipment8 (CHE) and the deployment of electric vehicle (EV) charging for fleet vehicles, public vehicles, and ground transportation increase significantly through the forecast period. Ferry and tug charging, modeled at spot load sites (Shilshole Bay Marina, Pier 16-17, and Terminal 46 North), and Near-port sites (Pier 50 and Colman Dock) are expected to contribute significantly to peak loads over time, with Washington State Ferry charging at Colman Dock starting as soon as 2028. While building loads are not expected to increase significantly over time - results show an estimated increase of 6-9 MW by 2050 - building electrification and site redevelopment remain a significant component of overall loads. The pace by which the Port electrifies its buildings and facilities also impacts when and where these loads occur. Similarly, loads from ship-to-shore (STS) cranes and electric transport refrigeration units (eTRU) are expected to increase moderately over time with increased cargo activity, but the magnitude of the overall load contribution from these uses is substantial. Forecast Results by Site Forecasted load among individual sites varies widely due to the type and quantity of specific electrified end-uses at each site. Table 1, below, shows the primary types of electrification load drivers expected at priority sites and Figure 13 shows forecasted peak demand in 2040. Peak load increases at each site above the 2019 baseline are important considerations because those increases help to determine if power distribution overload conditions may occur. 8 Cargo handling equipment includes forklifts, yard trucks, top-picks, side-handlers, and rubber-tired gantry cranes (RTGs) Seattle Waterfront Clean Energy Strategy |11 Page 200 of 373 Table 1: Expected Electrification Loads at Priority Sites SITE Shilshole Bay Marina Fishermen's Terminal Terminal 91 Terminal 86 Pier 66 (including uplands) Terminal 46 North Terminal 46 Terminal 25 and 30 Marine Maintenance Shop Terminal 18 Pier 16 and 17 Terminal 10 Terminal 5 Terminal 115 Terminal 106 and 108 EXPECTED ELECTRIFICATION END-USE LOADS Passenger ferry spot load, public EV charging Building electrification, building redevelopment, CHE, fleet vehicles, public EV charging, commercial fishing shore power Building electrification, building additions/demolitions, shore power, commercial fishing shore power, TRUs, CHE, fleet vehicles, public EV charging, ground transport (motorcoaches) Switcher locomotive spot load Shore power, building electrification, transport refrigeration units (TRUs), fleet vehicles, public EV charging 9 Tug and passenger ferry charging spot load Cranes, buildings, shore power, CHE, fleet vehicles, TRUs, commercial fishing shore power (Terminal 46 North) Cranes, buildings, shore power, CHE, fleet vehicles, TRUs, truck charging (Terminal 25 South) Building electrification, fleet vehicles Cranes, buildings, shore power, CHE, fleet vehicles, TRUs, truck charging Tug charging Redevelopment to transload facility (railcar pullers, locomotives, CHE) Cranes, buildings, shore power, CHE, fleet vehicles, TRUs Buildings, CHE, fleet vehicles, TRUs, truck charging Warehouse redevelopment, CHE Figure 13: Forecasted Peak Demand at Individual Sites in 2040 40000 Peak Demand (kW) 35000 30000 25000 20000 15000 10000 5000 0 Baseline Load Additions 9Options for EV charging for taxis and transportation network company (TNC) vehicles at the Pier 66 Uplands Garage are additionally being explored. At the time of the analysis, options for taxi/TNC charging on port sites were not in consideration and are not included in forecasts. Seattle Waterfront Clean Energy Strategy |12 Page 201 of 373 Overall, cargo (T-5, T-18, T-46, T-25-30) and cruise (T-91, P-66) sites show the most peak power demand due to significant shore power loads. Completion of site redevelopment and shore power additions at Terminal 5 are expected to increase peak demand above Terminal 18 over time. The significant load addition at T-5 is due to the incomplete state of redevelopment at the time of the baseline in 2019. At Terminal 91, development of the uplands and EV charging are key contributors to peak demand increases through 2040, while uplands public EV charging at Pier 66 (which includes both cruise operations as well as the uplands areas) adds a more modest two MW of additional peak demand. Other priority sites do not contribute significantly to port-wide peak demand. Load growth at near-port sites is also important for the ports and SCL to consider, with significant new loads anticipated at the USCG (Pier 36) and Washington State Ferries (Pier 52) sites, contributing upwards of 49 MW to the SCL distribution system through 2040. INFRASTRUCTURE CONSTRAINTS ANALYSIS The infrastructure constraints analysis used results of the demand forecast to identify where and when constraints would arise for both the SCL distribution system and on-terminal Port electrical infrastructure. Constraints on Seattle City Light's Infrastructure Constraints on SCL's power distribution system were identified by comparing forecasted loads with the existing capacity of power distribution feeders and equipment serving Port facilities. Based on available data, most SCL feeders are currently within their system design and thermal capacity limits. Two SCL feeders recently exceeded design parameters because of load growth, but mitigating solutions were already being actively explored. The forecast constraints analysis merged the ports' forecasted loads into the SCL's distribution system forecast model, LoadSEER. This allowed for consideration of the impacts of both port and non-port loads on feeders serving port sites. The results of the analysis showed that of the 16 feeders serving port facilities, 10 feeders are anticipated to exceed design or thermal conductor limits by 2040, with seven of those feeders exceeding limits as early as 2035. Out of the 10 feeders forecasted to exceed their design limits, eight are directly the result of forecasted port demand. SCL then conducted an analysis of solutions to mitigate identified feeder overload conditions and generated rough order of magnitude (ROM) cost estimates for those improvements. The analysis focused on traditional solutions such as substation improvements, switching, and feeders and distribution lines. SCL identified mitigating solutions at a total estimated cost of $69 to $168 million (2024 dollars). Table 2: Distribution System Mitigating Solutions Feeder FA01 FA02 FA03 FA04 FA05 Sites Served T-91 T-91, T-86 T-106-108 T-5 T-10, Harbor Island Truck Charging Identified Upgrades Upgrade switches, feeder, load reconfiguration Upgrade switches Upgrade switches, feeder improvements Upgrade switches, feeder improvements Upgrade switches Seattle Waterfront Clean Energy Strategy |13 Page 202 of 373 Feeder FA06 FA07 FA08 FB01 FB02 FB03 FB04 Sites Served T-18, T-25-30, MMS, P-16-17, T25S POS loads transferred T-46, T-46N T-115 T-5 West Marginal Way - T-115 Pier 2, CEM Property Identified Upgrades Load transfer, upgrade conductors, new feeder Upgrade conductor and switches Upgrade switches, new feeders Upgrade switches, feeder improvements Upgrade switches Feeder improvements Feeder improvements Constraints on Port of Seattle and NWSA Infrastructure Onsite infrastructure was assessed similarly to the utility distribution system analysis by disaggregating and mapping onsite loads to equipment and comparing forecasted loads to equipment ratings over the forecast timeframe. Constraints were evaluated for SCL transformers, at port site service entrances, and at on-terminal port substations. The analysis identified eight locations with constraints for the site as a whole and multiple port substation limitations. Table 3 summarizes individual site results and identifies recommendations to address the constraints. Table 3: Port and NWSA Infrastructure Capacity Constraints by Site Capacity Capacity Constraints Constraints Site On-terminal port SCL Substations Transformers Shilshole Bay No None Marina (spot load) Entire Site Capacity Exceeded Site loading limited by onsite SCL substation Mitigation Recommendations • • Fishermen's Terminal Yes One substation constraint (2040) None Terminal 91 Yes Yes Multiple substation exceedances with current configuration Two main substation exceedances with current configuration No • • Forecasted peak demand exceeds site capacity in 2035 with current infrastructure • • • • Monitor peak demand for vessel shore power and EV charging loads Infrastructure planning to address needs by 2035-2040 to accommodate charging loads Port substation upgrades by 2040 Assess asset conditions for equipment overdue for replacement Review site resiliency requirements and load configuration Removal of some electrification loads may alleviate constraints Uplands redevelopment plans & designs could alleviate constraints Upgrade transformers (Port and SCL) aligned with redevelopment plans Seattle Waterfront Clean Energy Strategy |14 Page 203 of 373 Site Terminal 86 (spot load) Pier 66 Capacity Capacity Constraints Constraints On-terminal port SCL Substations Transformers None SCL upgrades at Terminal 91 will alleviate constraints at Terminal 86 Yes Yes Main campus exceedance by Main campus 2040 due to and uplands building electrification. Uplands area exceedance by 2030 due to EV charging demand Yes Yes Entire Site Capacity Exceeded None • Managed charging for switcher locomotive to alleviate potential peak demand coincidence No • Upgrade main campus supply to accommodate building electrification from 2040-2050 Upgrade uplands building service transformers to accommodate EV charging dependent on garage deployment timeline (public/TNC) • Terminal 46 Total site and Terminal exceedance in 46N Tug charging will Three service 2050. Shifts to require a new entrances could 2040 with nearsubstation. exceed limits port load growth Future cargo operations will require South Substation upgrade Terminals 25 Yes None Total site and 30 capacity may be (Includes TOne substation Truck charging exceeded 25S truck exceedance in may exceed depending upon charging) 2040 limits depending truck charging on configuration configuration Marine Maintenance Shop Yes None North and South service entrances (2035-2045) Mitigation Recommendations • • • • • Total site capacity • exceeded by 2040 • Expected substation upgrade for vessel charging at T-46N Expected substation upgrade to accommodate CHE electrification Assess tug charging market conditions and timeframes Central substation replaced with planned capacity for future shore power The configuration of truck charging equipment type may trigger additional improvements. Upgrade North service entrance to accommodate building electrification from 2040-2050 Upgrade South service entrance to accommodate EV charger growth from 20352050 Seattle Waterfront Clean Energy Strategy |15 Page 204 of 373 Site Terminal 18 Capacity Capacity Constraints Constraints On-terminal port SCL Substations Transformers Yes Sufficient capacity in near One term with two exceedance in planned 2040-2050. substations Insufficient capacity to meet CHE charging may exceed CHE limits if peak electrification loads align with (2040) other end-uses (2035-2040) Entire Site Capacity Exceeded Sufficient capacity in near term with two planned substations Mitigation Recommendations • • CHE charging may exceed limits if peak loads align with other end-uses (20352040) • • Pier 16-17 (spot load) Terminal 5 Yes None Site exceedance in 2035 with tug charging • Site exceedance with CHE and eTRU load growth (20302035) Upgrades already required due to recent overload conditions Site exceedance with truck charging (20252030) • • No None Terminal 10, No Harbor Island Truck Charging Pier 2 and No CEM Property None Terminal 115 Yes (Includes W. Marginal Way truck charging) Terminal 106- No 108 None Site capacity exceeded in 2035 with truck charging • None Site exceedance with building, CHE and eTRU loads (20302050) • None Shore power is currently in design Further site upgrades (in addition to Table 5) expected to be required for CHE charging, including consideration of overall on-site power distribution and asset conditions. Includes SCL transformers and additional on-site substations Shift CHE charging windows where possible to limit peak contributions on coincident days Assess condition of site substations and address potential constraints in midterm with any improvements Upgrade service entrance by 2035 Continue to assess site upgrades and reconfiguration requirements according to tug charging market conditions and timeframes Feeder upgrades (2030-2035) • Upgrade switches to address current infrastructure constraints • Expected feeder upgrade to accommodate truck charging Continue to assess timing of truck charging deployment Upgrade onsite service transformers to accommodate load growth and truck charging • Feeder upgrade to accommodate expected warehouse redevelopment (Terminal 106) and CHE and eTRU loads (Terminal 108) Seattle Waterfront Clean Energy Strategy |16 Page 205 of 373 Alternatives Analysis ("Non-Wires" Solutions) An analysis was conducted to explore the feasibility of non-wires technologies to mitigate capacity constraints at the four most power-constrained port sites (Terminal 91, Terminal 18, Terminals 25-30, and Terminal 46 / 46 North) as an alternative to traditional upgrades at the site level. Non-wires solutions can be used to deliver clean energy, address forecasted energy needs, and provide for power resiliency. Combinations of non-wires solutions were identified for evaluation at each of the sites. The technologies that were chosen for further consideration included solar photovoltaic (PV), battery energy storage systems (BESS), thermal energy storage, load controls, hydrogen-powered CHE, onsite fuel cell power generation, and energy efficiency. The results of this analysis showed that traditional infrastructure improvements are currently the most cost-effective means of meeting projected load additions through 2040 for each of the sites analyzed. Alternative technologies had capital expenditure (CapEx) costs that were considerably higher than traditional infrastructure, ranging from 3x to over 10x higher at certain sites. One alternative was estimated to have high enough annual operating expenditures (OpEx) over the life of the project that those costs alone would negate the up-front cost savings from avoiding the traditional upgrade. While not found to be cost-effective at addressing overall site capacity constraints, deployment of alternatives can occur over time or along with end-use (e.g. CHE, truck, vessel, etc.) charging installations to help offset peak loads and associated peak electrical demand charges. Solar PV, load controls, and efficiency measures may be cost-effective and practical on a stand-alone basis. Table 4 summarizes site-specific findings and recommendations for the four sites analyzed. Table 4: Alternatives Analysis Recommendations by Site Site Recommendation Terminal 91  SCL feeder upgrade is the least costly option relative to the technology alternatives  Splitting the site load configuration among existing substations is the most cost-effective means of meeting anticipated load growth and could defer needed SCL upgrades through the 2040 time horizon. Recommended for further study  Install PV on new buildings and evaluate, rank, and implement PV on existing buildings  Evaluate opportunities for implementation of operational controls improvements for industrial refrigeration and other heavy loads  Monitor costs for battery energy storage (peak load mitigation and increased resiliency) Terminals 46  The CapEx for the alternatives proposed is lower than the 2050 SCL upgrade, but the and 46 North annual OpEx is high  Pursue technology solutions as they mature, including hydrogen-powered CHE, BESS, and on-site fuel-cell power generation  is Continue to monitor development of waterfront battery energy storage plans associated with adjacent sites (Pier 50, 52) Terminals  SCL upgrades are significantly lower in cost than the estimated CapEx and OpEx for 25-30 alternatives that can be deployed on site Terminal 18  Near-term SCL feeder load transfer will increase feeder capacity  Monitor and reassess hydrogen-powered CHE, battery energy storage systems, and onsite fuel-cell power generation as they mature between now and 2040 Seattle Waterfront Clean Energy Strategy |17 Page 206 of 373 "Non-Wires" Technology Alternatives: Areas for Ongoing Study Although alternative solutions were determined to not be cost-competitive at present, the ports and SCL should continue to monitor their feasibility as technology advance and costs fall 10. In particular, battery storage provides a promising means of deferring or avoiding infrastructure capacity upgrades, mitigating demand charges (utility fees for peak loading), and enhancing power resiliency. Hydrogen-powered equipment and battery energy storage systems (BESS) should continually be assessed in the near-term as opportunities to mitigate load additions, especially as part of scoping and exploring new end-use electrification projects. At sites where necessary SCL feeder upgrades are several years away, there is time for technologies to mature and potentially become cost-effective prior to making investment decisions. The cost of utility-side upgrades may also evolve. A current SCL-sponsored study for a waterfront BESS supporting loads at Pier 50 and 52 could present energy storage options in the vicinity of Terminal 46 and T46 North. The Ports should continue to monitor plans for those sites and the adjacent USCG facility. Energy efficiency may be deployed effectively to reduce overall energy requirements while maintaining or improving performance as with buildings and lighting. PVs are expected to be cost-effective on new buildings, and sites with available roof areas should be assessed and ranked for selective implementation. Crowley tug assisting container ship to Terminal 18 | November 2018 Studies in 2023 by NREL on utility scale battery costs projections identified a reduction in 4-hour lithium-ion battery system costs of 16-47% by 2030 as compared to 2022, and 21-67% by 2050. See: Cost Projections for Utility-Scale Battery Storage: 2023 Update, National Renewable Energy Laboratory, https://www.nrel.gov/docs/fy23osti/85332.pdf 10 Seattle Waterfront Clean Energy Strategy |18 Page 207 of 373 STRATEGIES FOR EXECUTION Page 208 of 373 STRATEGIES FOR EXECUTION Successful implementation of the SWCES requires ongoing and coordinated implementation by the ports, SCL, industry, and other interested parties. The SWCES includes two categories of recommendations: Capital Investments and Strategic Implementation Actions. It is expected that the implementation strategy will be discussed and reviewed by and among partners' operations and leadership to review viability and confirm best approaches. Capital Investments at the Port, NWSA, and SCL The SWCES analysis identified a series of distribution system and site-level upgrades needed to support electrification of port facilities and equipment. These include an estimated $69 to $168 million in distribution system infrastructure costs and an estimated $106 to $187 million in on-site transformer, switchgear, and substation equipment costs over the planning horizon (through 2050). These figures are preliminary, rough order of magnitude estimates and do not include the costs for vehicles, vessels, and cargo handling equipment or the associated charging station equipment and related site improvements. Port electrical equipment and utility infrastructure upgrades by site are outlined in Table 5. The table identifies project locations, the asset owner, load triggers expected to drive the need for upgrades, anticipated timing for upgrades, and costs. It should be noted that "asset owner" refers to the owner of the equipment for each project, but does not indicate fiscal responsibility, which would need to be determined on a case-by-case basis. For assets on NWSA-licensed properties, NWSA is listed as the asset owner. In-service years labeled as "current" were assumed to be under evaluation by SCL as of the time of the study. The project cost estimates for on-site equipment are "Class 10" estimates and should be considered as preliminary estimates for early-stage, programmatic planning. Class 10 estimates have a high degree of uncertainty and a wide range of accuracy. For the on-site equipment estimates below, the range of uncertainty is -30% to +95%. This uncertainty stems from unknown future inflation rates, electrical equipment supply chain limitations and other factors. Cost estimates for SCL infrastructure projects were provided separately by SCL. For projects identified in 2030 and beyond, SCL is also using a "Class 10" estimate. Drayage truck driver inspects connections at Terminal 5 | October 2022 Seattle Waterfront Clean Energy Strategy |20 Page 209 of 373 Target in-service years refer to the year that the anticipated upgrade is expected to be needed, based on the forecast conducted as part of this study. This in-service year is contingent upon the identified load trigger(s) being met. As the timing for project development and approval is not known at this time, project cost estimates are expressed in present-day (2024) dollars rather than escalated for future project delivery years. Projects are expected to undergo a detailed capital project scoping and development step before moving forward Projects may ultimately include additional electrical infrastructure repair or replacement due to age or condition of equipment. A minimum five-year lead time requirement is expected for planning, design, and construction of most projects. More extensive solutions such as feeder additions will require longer lead times in the range of 10 or more years. Although the certainty of the timing and magnitude of individual loads decreases over the planning horizon, planning should nevertheless begin early on long lead-time projects to ensure the ability to meet future load conditions. A set of initial, near-term capital investments are recommended for detailed evaluation and incorporation into Capital Investment Plans and are identified in blue in Table 5. All of the capital projects recommended in the Strategy will go through required environmental review, permitting, and approvals prior to construction and implementation at the relevant time. Harbor Island and surrounding area | May 2021 Seattle Waterfront Clean Energy Strategy |21 Page 210 of 373 Table 5: Port and Utility Capacity Improvements Project Summary Project Site Asset Owner Fishermen's Terminal Upgrade existing POS Substation No. 5 Port of Seattle Terminal 91 Upgrade switches SCL Load balance substations Upgrade feeder backbone Port of Seattle SCL Upgrade switches SCL Upgrade Main Substations (MSS-1, MSS-2) SCL transformers Port of Seattle, SCL Substation 13 (SS-13) Upgrade Port of Seattle Port of Seattle Substation 5 (SS-5) Upgrade Terminal 86 See Terminal 91 - upgrade switches with Terminal 91 in 2030. Target Rough Order of In-Service Magnitude (ROM) Year Cost Public EV charging (~68% 2040 $5,700,000 by 2040, ~66% by 2050); $15,800,000 C-15 building electrification (~23% by 2040, ~25% by 2050) Shore power, building Current $100,000 electrification Following review of site n/a n/a resiliency requirements Shore power, building 2030 $6,600,000 electrification, EV charging Shore power, building 2030 $220,000 electrification, EV charging Overall site demand 2030$270,000 - $800,000 additions (shore power, 2040 uplands redevelopment, building and fleet electrification, etc.) Uplands redevelopment 2040 Project currently in design Forklift Charging 2030 $14,300,000 Load Trigger(s)11 11 Where expressed as percentages, load triggers represent the percentage contribution to site peak demand additions in the specified year. Seattle Waterfront Clean Energy Strategy |22 Page 211 of 373 Project Site Pier 66 Terminal 46 & 46N Multiple Sites - Seattle Harbor South (MMS, T25/30, T18, P16/17, T5) Marine Maintenance Shop (MMS) Asset Owner Load Trigger(s)11 Target Rough Order of In-Service Magnitude (ROM) Year Cost 2040-2050 $7,800,000 $21,600,000 Main campus service upgrade Port of Seattle Building electrification at Bell Harbor International Conference Center and/or Anthony's Restaurant; project location and scope dependent on upgrade sequencing and building code determinations Upgrade uplands service Port of Seattle Project scope will be dependent on future EVSE deployment plans New Harbor Vessel Charging Substation (T46N) Substation upgrades (T46) Port of Seattle, SCL Port of Seattle, NWSA, SCL Public EV charging and/or n/a TNC charging; project is not currently forecasted to be needed, but should be re-evaluated depending on EVSE siting and timing Harbor vessel charging 2035 spot load 2035 $33,800,000 $94,300,000 Two new feeders to cover load (T46) SCL 2050 Load transfer, upgrade conductors SCL Current $35,000,000 $97,500,000 $2,000,000 Feeder upgrades SCL CHE charging (~94% of new peak demand by 2030); Fleet vehicle electrification (~12% of new peak demand by 2035) Load growth at P66, T46, T46N and non-Port sites Future load growth at multiple sites Port loads transferred Current $3,300,000 New Feeder SCL Future load growth at multiple sites 2050 $19,250,000 $53,625,000 Upgrade North Service Entrance Port of Seattle Building electrification (~71% by 2035, ~63% by 2040) 2035 Project currently in planning $16,000,000 $44,600,000 Seattle Waterfront Clean Energy Strategy |23 Page 212 of 373 Site Project Marine Maintenance Shop (MMS) Terminals 25 and 30 Terminal 18 South Service Entrance, Substation Transformer Upgrade Asset Owner Terminal 25, South Substation Port of Seattle, SCL NWSA Substation Upgrade NWSA Pier 16 and 17 Upgrade Service Entrance Terminal 5 Load Trigger(s)11 Fleet EV charging (~28% by 2030, ~35% by 2035) Target Rough Order of In-Service Magnitude (ROM) Year Cost 2045 $4,000,000 $11,200,000 2030 $7,600,000 2030 $10,500,000 NWSA Truck Charging (20402050) CHE electrification (20302050) Tug Charging spot load 2035 Upgrade switches A SCL CHE electrification 2030 $7,500,000 $21,000,000 $100,000 Upgrade switches B SCL CHE electrification 2030 $500,000 Feeder improvements SCL CHE electrification 2035 Terminal 10, Harbor Island Truck Charging Pier 2 & CEM Property Upgrade switches SCL Recent overload conditions; CHE and nonPort loads Current $385,000 $1,072,500 $100,000 Feeder upgrade SCL Truck Charging (20252030) Current Terminal 115, West Marginal Way Truck Charging Upgrade South Substation NWSA Upgrade SCL Transformer SCL Upgrade switches SCL Upgrade East Substation NWSA C-4 building electrification 2030 and forecasted load growth (2025-2030) CHE & fleet vehicle charging (2030-2050) C-4 building electrification 2030 and forecasted load growth (2025-2030) CHE & fleet vehicle charging (2030-2050) EV fleet vehicle and CHE 2030 electrification Forecasted reefer plug 2035 additions by 2035 (400 to 600) Project currently in planning $12,000,000 $11,800,000 $110,000 $8,300,000 $23,200,000 Seattle Waterfront Clean Energy Strategy |24 Page 213 of 373 Project Site Terminal 115, West Marginal Way Truck Charging Terminal 106108 Asset Owner Feeder upgrade SCL Feeder upgrade SCL Feeder upgrade SCL Load Trigger(s)11 EV fleet vehicle and CHE electrification Truck charging Buildings, CHE and fleet vehicle charging (20302050) Target Rough Order of In-Service Magnitude (ROM) Year Cost 2035 $231,000 - $643,500 2035 2040 $508,200 $1,415,700 $385,000 $1,072,500 Seattle Waterfront Clean Energy Strategy |25 Page 214 of 373 Strategic Implementation Actions Strategic actions will be critical to help ensure achievement of decarbonization goals, provide a holistic approach to capital planning and investment, and reduce project risk. Eight strategic actions plus a Joint Implementation Framework have been identified for implementation in concert with capital project improvements. SA1. Design for Future Electrification Capacity The ports and SCL should continue to emphasize "planned capacity" improvements as a part of preparations for electrification and a shift from an incremental, project-by-project investment approach. This means making proactive improvements in anticipation of load growth rather than improving capacity to the requirements of immediate projects. The Port has begun implementing modular (expandable) substation designs in anticipation of future electrification load increases and should continue to anticipate and budget for future load increases proactively as a part of all infrastructure projects. By designing infrastructure for increased load capacity to support end use electrification demands, the ports will be preparing for the future and may avoid the need for costly and time-consuming additional upgrades as loads increase. This shift will increase the risk of stranded assets if increased loads from end use electrification fail to materialize - as through delayed electrification equipment investment and changes in alternative technology development. However, efforts can be taken to help mitigate these risks. For example, continued and enhanced power monitoring can help to refine estimates of future power need which can be factored into planning and design work, and ongoing engagement with tenants and customers will enhance understanding of electrification plans, timing and need for support. Support for a planned capacity approach to infrastructure planning may be implemented through the Port's Sustainable Evaluation Framework (SEF) and regularly evaluated as a part of engineering design alternatives. Implementation of the planned capacity approach and SEF would also be reinforced by site master planning (also recommended below), which would refine a site's long-term capacity target and conceptual space utilization parameters based on planned uses. SA2. Asset Condition Assessment To inform implementation of the SWCES, the ports should continue to work with tenants to assess and document the current condition of on-terminal infrastructure, expand assessments to all sites, and use the resulting data to make necessary adjustments to the infrastructure investment and project schedule recommendations. Some condition assessments and power safety assessments have been pursued at the ports. However, detailed information on the condition of port-owned on-terminal electrical infrastructure was not available for most assets during the baseline assessment portion of this project. Therefore, recommendations for capital projects are based on forecasted electrical load capacity constraints and did not consider equipment age or condition. SA3. Identification of Critical Facilities for Resiliency Energy resiliency is the ability of the electrical grid, and the buildings, communities, and other critical services that are served by that grid, to withstand and rapidly recover from power outages or other disruptions. In the case of seaports, resilience is largely defined by the ability Seattle Waterfront Clean Energy Strategy |26 Page 215 of 373 to remain operational and continue to offer services to ships, cargo carriers, and other customers during disruptions. Resilient ports, as characterized by the United Nations, are those that "can cope with shocks, absorb disruptions, quickly recover and restore operations to a level similar to - or even above - a baseline, as well as adapt to changing conditions, as it continues to develop and transform."12 In development of the SWCES, resiliency was considered a co-benefit. To leverage investments in port infrastructure and increase operational reliability, the Port should work with tenants to assess power resiliency requirements, identify critical facilities, identify utility hazard exposure, risk, and vulnerabilities (e.g. flooding and sea level rise, groundwater intrusion, seismic hazards), and assess the status of backup generation resources at Port facilities. This assessment should also identify facility-specific resiliency improvement opportunities. Technological alternatives such as onsite battery energy storage systems (BESS) or more extensive microgrids could provide resiliency benefits to Port facilities, enabling continuity of critical port or tenant operations in the event of grid outages. With an increased focus on electrification of end uses and load growth in the Pacific Northwest, the availability of power is increasingly important. Furthermore, regional sea level rise studies have identified groundwater intrusion as a significant concern on waterfront facilities, potentially affecting the reliability of duct banks, vaults, and other electrical infrastructure and the potential need for relocation of equipment. Finally, strategies to optimize power distribution to port facilities will benefit greatly from a clear understanding of power redundancy and resiliency requirements for Port and tenant operations at different sites. SA4. Integration with Site Master Planning Port properties do not currently have site master plans to guide future development. This makes preparations for future infrastructure investment challenging given that infrastructure capacity, location, and timing are inextricably linked to the future uses at a site. In addition, port property is a highly valued commodity (estimated at over $150,000 per acre per year for cargo sites) and allocating space for switchgear, transformers, battery storage, charging equipment, and other above and below ground power infrastructure will need to be planned carefully. Master site development plans should use SWCES data to align strategic goals with site conditions, resiliency strategies, and business and other organizational priorities to guide short and longterm development. Ideally, infrastructure, including power infrastructure, should provide for the overall site objectives and follow an integrated planning effort. Recent redevelopment plans and strategic evaluations identified the need for shared infrastructure development and reconsideration of site uses. Additionally, to meet decarbonization goals, cargo facilities are expected to require significant investment in electrified CHE and on-terminal infrastructure which may impact current terminal operations and layout. As a next step in the implementation process, preparation of site-level electrification master plans would begin the process of detailed on-terminal design. Ideally, electrification master 12 https://resilientmaritimelogistics.unctad.org/guidebook/21-defining-port-resilience Seattle Waterfront Clean Energy Strategy |27 Page 216 of 373 plans would follow and complement overall site master plans that also account for expansion, reconfiguration, changes in land use, and circulation among other aspects. Findings from the SWCES analysis point to the near-term need to complete electrification master planning efforts for Terminal 91 and Pier 66. Additional priority locations for electrification-decarbonization master planning include Terminal 18, Terminal 25/30 and Terminal 46 (including T46 North). These sites should be prioritized because they include a combination of potentially significant load growth from cargo handling equipment, shore power, truck charging, and harbor vessel charging and have significant distribution system constraints under current feeder arrangements. The timing of these electrification master planning studies should be determined based on engagement with the tenants at these facilities, timing of any planned redevelopment projects, and scope/timing of key adjacent projects that may impact these facilities and local system capacity, such as the potential USCG base expansion project. SA5. Infrastructure Management and Development Port lines of business currently share responsibility for development, regulatory compliance, and management of onsite infrastructure including power as well as water, sewer, stormwater, communications, and transportation. This arrangement reflects the multiple users benefiting from these common assets but requires high levels of continuous coordination. Individual project needs for a line of business can also trigger much more significant site infrastructure improvement requirements, potentially overwhelming an individual project's feasibility. Differentiating site-wide infrastructure responsibilities from those of individual lines of business and tenants can help to improve the Port's ability to effectively meet the myriad, interrelated demands on these assets. These include parameters such as capacity, reliability, safety, and resiliency - all of which will be critical to meeting decarbonization, sea-level rise, asset replacement, site redevelopment, long-term operations, and other objectives. SA6. Increase Grant Project Readiness The ports and industry partners should use the SWCES results to assess, scope, and regularly update a suite of grant-ready projects to be well positioned for funding opportunities to increase the likelihood of funding to offset port, utility and tenant investment costs. The assessments and updates should include utility distribution system assets (e.g. feeders, substations, transformers, switchgear, smart meters, utility-side storage, etc.), port on-terminal assets (e.g. port substations, distributed generation and storage, energy monitoring, duct banks, etc.), and public and private decarbonization deployment projects (e.g. shore power, vessel charging, fleet and equipment charging, building electrification, etc.). Outside funding will be essential to reduce barriers to deployment, but careful attention should be made to the complexities of grant obligations and multi-party commitments to minimize any added costs, delays and overall deployment risk. SA7. Clean Technology Development The Port should consider an innovation-focused maritime decarbonization lens as a useful framework for the Port to advance the deployment of electrification and clean energy technologies on Port-owned properties. This framework seeks to align and integrate clean energy and economic development objectives to advance the development, demonstration, Seattle Waterfront Clean Energy Strategy |28 Page 217 of 373 and/or deployment of zero emissions technologies at the Port as a part of a holistic decarbonization and economic development strategy. The commercial availability of electrification technologies is a key factor which will drive load growth timing and the ability to achieve long-term targets. However, electrified end-uses designed for the operational demands of the maritime environment present varied challenges including technological readiness, the cost gap between electric equipment and conventional fossil-fueled equipment, operational limitations of electric equipment, special requirements for maritime equipment, and space constraints on Port properties for charging infrastructure (a summary of expected barriers for different end use categories is included in Appendix B). The ports' primary role as landlords means that electrification and decarbonization of end uses will need to largely occur through private sector investments. Accordingly, it is critical for the ports and utility to continue to monitor technologies and actively engage with maritime industry operators to understand overall site investment plans, build awareness of alternatives, and identify additional barriers and opportunities to help ensure effective planning for power infrastructure. The Pacific Northwest is a leader in clean technology business investment and home to an emerging hydrogen ecosystem. The Port should leverage these clean technology conditions and its concentration of heavy duty transportation end uses, diverse array of properties, high visibility, NGO partnerships, ambitious emissions reduction targets, and economic development mission to encourage maritime innovation at the Port. Working together, the ports and SCL could explore opportunities to pilot new technologies, develop market transformation supportive initiatives, or leverage planned investments to support neighboring industries. Efforts such as the U.S. Department of Transportation Maritime Administration's National Center for Maritime Innovation are intended to facilitate increased study, development, assessment, and deployment of emerging maritime technologies related to environmental challenges specifically including vessel and port emissions. Emerging hydrogen technologies are expected to play a role in decarbonization of site operations, potentially addressing limitations of battery technologies for heavy lift or extended range applications while reducing requirements for peak power delivery. A diversified power resiliency strategy could include hydrogen fuel cell-based backup power as equipment costs decline and clean hydrogen supply develops in the region. Hydrogen technologies should continue to be evaluated as a part of planned end-use technology assessments and considered for support through technology advancement and joint innovation projects in collaboration with NGO and port business partners. While the focus of the SWCES is on electrification, given its efficiency and emissions reduction potential, low carbon fuels are expected to play an important role in decarbonization of the maritime sector. The overall investment in electrified zero emissions equipment is likely to be in the billions of dollars for the end-uses covered by this strategy and is forecasted to occur in phases throughout the 25-year planning horizon. In the interim, renewable diesel is a drop-in fuel that can produce GHG emissions reductions of up to 50% or more in existing vehicles, vessels, and equipment. The ports can simultaneously leverage grants, phased-in requirements, zero emissions clean technology pilot project support, and other strategies to accelerate turnover. The ports should continue to advance parallel efforts as a part of its Seattle Waterfront Clean Energy Strategy |29 Page 218 of 373 Sustainable Maritime Fuels program and increase the availability and uptake of low and zero carbon liquid fuels. As the ports support advancement in new technologies, there should be attention to potential impacts to the maritime workforce and ways to ensure they are ready for this transition. Reskilling, technical education, career-connected learning, and other workforce development strategies should be considered as important complementary efforts to the transition to new technologies and fuels. SA8. Innovative Business Models and Financial Strategies The Port should consider leveraging alternative business models and financial strategies to facilitate the deployment of clean energy infrastructure and end uses. Such approaches could include innovative models of financing, ownership, electricity rate design, or lease and agreement terms that ultimately encourage or enable the adoption or use of zero-emissions technology. Innovative business models and financial strategies may help address today's barriers to adoption through lower up-front capital costs and cost recovery, by creating an incentive for electrification, by harnessing operational efficiencies, and creating other potential benefits. The Port considered a range of potential business models and financial strategies and identified the four summarized in this section as the most promising to support deployment based on Port circumstances and current end-use technologies. It should be noted that this is not intended to be an exhaustive list, and the Port should continually evaluate opportunities, particularly as new partnership opportunities arise with customers, tenants or third-party providers and as state, federal or international policies change. These funding and financing strategies will need to be weighed against and in context of the ports' and utility's other financial strategies and demands. The business models and financial strategies identified are: • • • • Inflation Reduction Act (IRA) Elective Pay Funding As-a-Service Models Innovative Rate Design Special Purpose District Authorities Inflation Reduction Act (IRA) Elective Pay Funding: Elective Pay, also called Direct Pay, is a ground-breaking tax mechanism introduced under the IRA that involves leveraging expanded tax credits to support clean energy sector manufacturing, installation, and production through 2032. The Elective Pay system enables tax-exempt and governmental entities to receive payments equivalent to the full value of tax credits for building certain clean energy projects. Tax credits can be roughly divided into production tax credits (for the production of electricity or fuels) and investment tax credits (for capital investments in clean energy technology). Elective Pay has the potential to be used for clean electricity (production or investment), carbon dioxide sequestration, advanced energy investments (including clean energy manufacturing and industrial decarbonization projects), commercial clean vehicles, alternative fuel vehicle refuelling, clean hydrogen production, and other projects. The program is potentially beneficial to the Port in that it enables the Port to participate as a viable stand-in for private sector tax equity financing. Importantly, Elective Pay credits can be used to supplement funding from other federal or state grant programs without penalty. Seattle Waterfront Clean Energy Strategy |30 Page 219 of 373 As a next step, the Port should conduct a more detailed study on the applicability of Elective Pay to prospective Port projects. For example, Elective Pay includes specific requirements for project siting and technology utilization that should be considered in detail alongside current operational profiles at Port properties. This type of study would be a necessary first step towards determining Elective Pay's feasibility as a financing mechanism for deployments of new electrification technology or supporting infrastructure at the Port. Potential applications: energy storage, clean hydrogen production, EV purchase, EV or hydrogen fuelling infrastructure, solar, clean energy demonstration projects, microgrid technology. "As-a-Service" Models: As-a-service models are financial arrangements where a third-party provider owns, operates, and maintains an energy system or equipment and charges the customer for the service or output, rather than any one entity paying the upfront capital cost to own the system or equipment. As-a-service models can be applied to various systems, including charging as a service, storage as a service, trucking as a service, and various other applications. As-a-service models support the deployment of energy systems or assets by reducing up-front capital costs as well as operational and maintenance risks and are well-suited to deploying assets with high up-front costs where a revenue stream can be generated during operations to offset as-a-service fees. A typical arrangement would involve a private third party as the service provider, however, the Port could also act as a service provider. For Port-owned projects, As-a-service models typically wouldn't provide as clear a benefit given the Port's low cost of capital and relative access to capital funds. As a next step, the Port should continue to consider As-a-service models to support deployments where opportunities for such deployments arise at Port properties. In particular, electric heavy-duty trucking is a current area where the Port is engaging with As-a-service providers as a potential means of deploying infrastructure. Potential applications: Solar, energy storage, microgrid systems, EV or hydrogen fueling infrastructure deployment, electric heavy duty trucks. Innovative Rate Design: Innovative rate design refers to methods for pricing electricity to achieve specific goals with regards to tenant or customer energy usage. Targeted electricity rates could be used to lower barriers to the adoption and use of desired technologies, particularly where high operating costs associated with energy usage contribute significantly to overall project costs. This could allow for a more rapid return on investment for technologies that are in a demonstration phase and/or have very high up-front adoption costs as compared with incumbent fossil-fueled technology, such as electric harbor vessels, CHE, or zero-emissions trucking. This model could also help to incentivize more widespread usage of shore power for a variety of commercial vessel types at various Port facilities. At present, any new rate structures used at the Port would need to be carried out in cooperation with SCL. SCL typically assesses the feasibility of new rate structures through pilot rates, which may be utilized for an extended period of time to determine impacts. As a next step, the Port and SCL should leverage the SWCES findings to study the need for and feasibility of rate design measures, such as pilot rates, to achieve shared goals with regards to specific technologies. Potential applications: Shore power, electric harbor vessel deployment, CHE charging, truck charging, electric locomotive deployment. Seattle Waterfront Clean Energy Strategy |31 Page 220 of 373 Special Purpose District Authorities: The Port currently operates under state statutory authority as a Port District (RCW Title 53) providing for the acquisition, construction, maintenance, operation, development and regulation of harbor, rail, transfer, storage and related activities. This includes the ability to establish industrial development districts (including the direct provision of power, as is the case for the airport) and pollution control facilities (including air and water pollution). These authorities should be reviewed for opportunities to align the ports' emissions reduction and clean air goals with the ports' ability to invest in policies, programs and activities which incent private party deployment of pollution reducing technologies and clean fuels. The ability to provide incentives across maritime activities is a significant limiting factor in the ports' programs and would add an important tool which is already available to competing ports in other states as well as British Columbia. Similarly, such an evaluation should also consider the authorities of ports to invest in new clean fuel technologies, such as green electrolytic hydrogen production and its derivatives such as methanol, and the associated production, distribution, and sale of clean fuels to end users. Recommended next steps include an evaluation of the needs, opportunities, gaps, and expected benefits of one or more approaches including consideration of the legal, legislative, and financial mechanisms that may be required. Potential applications: low and zero emissions technologies, clean maritime fuels. Preparing for Deployment: Joint Strategy Implementation Framework A joint Port, NWSA, and SCL execution strategy will be critical to effectively implement the SWCES. Design, permitting, construction, and sequencing of utility distribution system investments, on-terminal port electrical equipment, and demand-generating electrified end uses across multiple port locations will need to be coordinated. Work with industry stakeholders will be vital to inform technology deployment options and timelines, and large, long lead-time capital investments will benefit from a clear, collaborative, and coordinated approach. Implementation of the SWCES involves two major workstreams - one focused on infrastructure deployment and another focused on end-use electrification (e.g., installing shore power connections, charging infrastructure, electric vehicles and equipment, etc.). See Figure 14 below. The Site and Distribution Infrastructure Deployment workstream will be vital for timely permitting, design and construction of infrastructure as well as managing available capacity. Ongoing monitoring, project planning, and design of load serving strategies would drive investments to be evaluated for incorporation into Capital Improvement Plans on an annual basis. A Joint Capital Planning and Implementation Team involving key staff from the Port, NWSA, and SCL should be established to provide for effective coordination and implementation on an ongoing basis. Seattle Waterfront Clean Energy Strategy |32 Page 221 of 373 Figure 14: Strategy Implementation Framework SWCES Strategy Site and Distribution Infrastructure Deployment Waterfront Electrification Capital Improvement Plans (CIP) Project-level planning, permitting, design & construction End Use Electrification Deployment Industry engagement, technology assessment & project partnership development End use electrification projects, supportive policy & grant funding Joint Implementation Framework The End Use Electrification Deployment workstream will be vital to increase the electrification of vehicles, vessels, and equipment, and drive adoption in line with emissions reduction goals. This effort should tie in with interim liquid fuel strategy options noted above. Ongoing monitoring will be important to inform capital project investment, and effective implementation strategies for industry engagement, technology assessment, grant funding, and partner development will be necessary for successful implementation. Figure 14 outlines the major workstreams anticipated with the implementation of the SWCES and Table 6 identifies key implementation aspects. Cruise ship plugging into shore power at Smith Cove Cruise Terminal | May 2022 Seattle Waterfront Clean Energy Strategy |33 Page 222 of 373 Table 6: Key Implementation Aspects Implementation Aspect Parties Overarching strategy monitoring, partnering agreement oversight, establish joint implementation framework, strategy review and update Port, NWSA and SCL leadership Site and Distribution Infrastructure Deployment Planning and engineering groups from the Port, NWSA and SCL • • • • • • • • Capital Investment Plan (CIP) Port, NWSA and • SCL finance teams Project-level planning, permitting, design and construction Port, NWSA and SCL project delivery and permitting • • Industry engagement, technology Port and NWSA assessment and project partnership Sustainability development teams and SCL Electrification and Strategic Technologies • • • • • End use electrification projects Port and NWSA Sustainability teams and SCL Electrification and Strategic Technologies • • • • • Roles Periodic review of implementation progress, lessons learned, status of loads, available capacity, and emerging issues and conditions Direct strategy review and update in 3-5 years as needed Port leads site master planning Utility leads system planning Convene Joint Capital Planning and Implementation Team Coordination and review of long-lead projects including major infrastructure Monitoring of available capacity and project status. Minimum of annual recommendations for capital investment. Annual updates to Port, SCL and NWSA CIPs, incorporating new projects and adjusting timing on a rolling 5-year basis Coordinated project delivery Quarterly advance planning meetings to review and coordinate upcoming projects, periodic meetings as needed for ongoing coordination Port and NWSA lead industry engagement Identification and update of barriers / opportunities Assess pace of technology adoption, identify new projects and opportunities to pilot technologies Vetting of potential projects and identification of potential power system impacts Periodic review of end use and non-wires technologies and costs Project development support for vetted projects Clarify project requirements, identify system planning or capital investment needs Identification of supportive policies, incentives, business models, and partnerships to advance projects Develop grant ready projects, pursue as appropriate Inform infrastructure planning and deployment aspects above, including certainty, location, timing, and size of electrification deployment projects Seattle Waterfront Clean Energy Strategy |34 Page 223 of 373 A periodic review and update of the SWCES in the three to five year timeframe is recommended to guide iteration of investments and ensure that the recommendations remain timely and actionable. Key elements of the strategy to review in the next cycle include: • • • • • • Revisiting the SWCES load and electrification forecast relative to actuals to calibrate the model and identify site-wide and feeder-level trends in Port and Near-port load conditions Review of relevant policy developments that could affect forecast conditions (e.g., new/amended decarbonization mandates or incentives) Review of tenant needs and highest priority electrification projects that will drive load growth Technology readiness (e.g., commercial availability) of vehicle, vessels, and equipment Review of energy storage costs Updated capital project recommendations Conclusions and Next Steps Building on the Partnering Agreement The project partners entered into a Partnering Agreement in October 2021 to facilitate the successful development and implementation of the SWCES. The Partnering Agreement memorialized a shared vision for a clean energy future and established commitments for holistic joint planning, innovation, cooperation, and SWCES project management. The Partnering Agreement13 was forward looking and established an initial ten-year term of collaborative work, anticipating a transition from planning to implementation. With the completion of the SWCES, the parties have established not only a strong working relationship, but also a solid foundation of data and insights to guide future investments and implementation of recommendations. The SWCES is intended to be a core element of the ports' implementation plans for the Northwest Ports Clean Air Strategy, creating the enabling infrastructure necessary for achievement of port and community goals. As growth in electrification of non-port sectors advances, due in part to state level policy drivers and regional ambitions, a regular assessment of progress and review of available capacity will be vital to ensure findings continue to be current and actionable. Accordingly, ongoing coordination and effective execution of the SWCES recommendations by the ports and SCL in line with the Partnering Agreement will be critical to ensure the achievement of ambitious emissions, resiliency, and equity targets and meet the new realities of electrified maritime operations, new electrical system configurations, and rapid technology adoption. 13 The Partnering Agreement covers a 10 year initial term and includes commitments for: joint planning; establishing designated representatives and processes to manage the SWCES strategy development, capital planning and delivery processes; coordinating studies, plans and projects to facilitate integration of the SWCES within broader objectives of the parties; providing for strategic innovative solutions; establishing a framework for ongoing coordination and implementation of capital projects; coordinating communication and engagement with stakeholders; and developing shared funding strategies to support clean energy investments. Seattle Waterfront Clean Energy Strategy |35 Page 224 of 373 APPENDICES A. Policies and Targets Informing the Seattle Waterfront Clean Energy Strategy B. Expected Barriers to End-Use Electrification Page 225 of 373 APPENDIX A: POLICIES AND TARGETS INFORMING THE SEATTLE WATERFRONT CLEAN ENERGY STRATEGY Washington State • Washington State Zero Emissions Vehicle (ZEV) Standards: Identifies required EV sales schedule for passenger vehicles and class 2b-8 MD/HD vehicles through 2035. • Washington State Clean Buildings Performance Standard: Mandated energy performance standards for commercial buildings larger than 50,000 square ft, establishing energy use intensity targets (EUI). City of Seattle • Seattle Building Emissions Performance Standards: Draft standards (2022) were included in the forecast, aimed at reducing emissions in large commercial buildings through GHG intensity targets for specific building types aligned with the SWCES forecasting periods. • City of Seattle Energy Code: Standards applicable to non-residential commercial buildings are integrated in the building energy modeling of the forecast and assume new technology and energy efficiency improvements are incorporated into applicable buildings over the forecast timeframe. Northwest Ports Clean Air Strategy, NWSA Implementation Plan and Port of Seattle Maritime Climate and Air Action Plan (2021) Emissions • • Phase-out all emissions (GHG and criteria air pollutants) by 2050 Zero absolute emissions from building and lighting energy use (Port and tenant facilities) by 2050 Shore Power • • • • Shore power infrastructure installed at all major cruise and container ship berths by 2030 Complete design of T18 shore power by 2025 Within 2 years of shore power infrastructure availability, 50% of shore power capable vessel calls plug-in (80% within 3 years) 100% of home port cruise ship calls connect to shore power by 202714 Cargo Handling Equipment • • By 2030, sufficient infrastructure is in place to enable transition to zero-emissions cargo handling equipment 100% zero emissions cargo handling equipment by 2050 14 The Port's target for cruise shore power connections was advanced from 2030 to 2027 with adoption of a Shore Power Order in 2024. Page 226 of 373 Harbor Vessels • • By 2030, sufficient infrastructure is in place to enable transition to zero emissions harbor vessels 100% zero emissions harbor vessels by 2050 Trucks • • 100% zero emissions trucks by 2050 Infrastructure for zero emissions trucks by 2050 Rail • • Infrastructure for zero emissions on-terminal rail by 2030 100% zero emissions switcher engines adopted by 2050 Fleets • • • 100% of Port‐owned light duty vehicles are electric or use renewable fuels by 2030 100% of Port equipment (HD vehicles, equipment and vessels) are zero emissions by 2030 100% of Port equipment (HD vehicles, equipment and vessels) are zero emissions by 2050 Buildings • No fossil natural gas use in Port‐owned buildings (eliminate fossil gas use and no new connections) by 2030 Fishing trawlers plugging into shore power at Terminal 91 | May 2022 Page 227 of 373 Port of Seattle Century Agenda Goal 1 - Position the Puget Sound region as a premier international logistics hub • • Objective 1 - Meet the Puget Sound region's int'l trade and cargo needs in an efficient and sustainable manner Objective 2 - Support the continued success and competitiveness of the NWSA Goal 2 - Advance this region as a leading tourism destination and business gateway • • Objective 3 - Continuously improve the operational efficiency and customer experience at SEA Objective 4 -Strengthen the competitiveness of SEA in the regional and global marketplace Goal 3 - Responsibly Invest in the Economic Growth of the Region and all its communities • • • Objective 6 - Increase career and business opportunities for local communities in all port-related industries Objective 7 - Advance maritime industries through innovation, strategic investment and capable management of Port facilities Objective 8 - Expand the economic, cultural and community benefits of Cruise operations while preserving industrial lands Goal 4 - Be the greenest and most energy-efficient port in North America • • Objective 9 - Meet all increased energy needs through conservation and renewable sources Objective 11 - Reduce air pollutants and carbon emissions Goal 5 - Become a Model for Equity, Diversity and Inclusion • Objective 14 - Ensure that all internal and external programs, structures and practices provide equitable opportunities for all Goal 6 - Be a Highly Effective Public Agency • • • Objective 16 - Advance the Port's dedication to employee engagement, safety, innovation, and financial stewardship Objective 18 - Partner and engage with external stakeholders to build healthy, safe and equitable communities Objective 19 - Set the standard for high-quality, cost-effective, and timely delivery of capital programs Solar panels on Pier 69 | April 2019 Page 228 of 373 SCL Strategic Plan - Business Strategies15 • • • • • Improve the customer experience. Seattle City Light prioritizes our customers and strives to tailor our services to meet their needs and exceed expectations. We are investing in improvements that will make our services more accessible and provide more options. Whether we're enhancing our programs or introducing new ones, our goal is to better serve our customers. Create our energy future. The future of energy is arriving ahead of schedule and is dramatically impacting the energy landscape. Disruptive forces have accelerated, and we must be prepared to address climate change, a shift from using fossil fuels to clean electricity, and an increase in electricity demand from electric vehicles and building standards. These changes impact our infrastructure from generation to how we connect to your home or business. We are improving our systems and infrastructure to meet our capacity needs now and in the future. Develop workforce and organizational agility. As our industry and customers rapidly change, we must invest in our people and processes to enable them to respond, adapt, and thrive. We are creating a flexible and responsive organization by focusing on change management, training, and new technology. Our efforts aim to attract, train, and keep talented staff. We want to see higher employee engagement, more career opportunities, and staffing that supports our organizational priorities. Ensure financial health and affordability. Financial stability is crucial to our future. It allows us to create innovative energy solutions, invest in critical infrastructure, and keep our rates affordable. We are committed to setting rates in a way that is sustainable and predictable over time. We Power. "We Power" refers to our core mission as a utility - to provide affordable, reliable, and environmentally responsible energy services to our customers. This drives everything we do, and our values guide us in achieving this goal. Our commitment to our core business operations and delivering value to our customers includes: providing the energy services our customers need by taking care of our key assets and infrastructure; prioritizing diversity, equity, and inclusion; and managing and mitigating the challenges, risks, and uncertainties of a changing world. SCL Mission and Values (multiple documents) • • • Environmental Stewardship: We care about the environment, and we are dedicated to enhancing, protecting and preserving it for future generations Equitable Community Connections: We are visible and actively involved in the communities we serve. We are rooted in our commitment to racial diversity, social justice and the equitable provision of services to all. Operational and Financial Excellence: We prioritize our investments and operating choices to build upon our strong financial foundation and solid, reliable infrastructure. 15 Strategic Plan and Review Panel - City Light | seattle.gov Page 229 of 373 APPENDIX B: EXPECTED BARRIERS TO END-USE ELECTRIFICATION The following table provides a high-level summary of expected barriers to electrification specific to current port conditions. This looks at each category of end-use equipment, summarizing technology barriers (including technology readiness, and operational limitations) and electrical infrastructure constraints identified in the SWCES. Recommendations to support deployment are provided. End-Use Technology Barriers Electrical Infrastructure Constraints Low; building electrification technologies Low; most natural gas use is concentrated at • are mature and implementation has already Pier 66, Terminal 18, Terminal 115, begun and is being planned at Port Fishermen's Terminal, and Terminal 91. properties. Building energy use at most Port Conversion from natural gas to electricity will properties is mostly electric. increase peak demands, which will be more significant on building-dominated sites such as Pier 66, requiring on-terminal electrical upgrades. Shore Power Low; shore power technology is mature and High; increased use of shore power and • has already been installed at several port additions at cargo and near port locations properties. (USCG), are the largest drivers of load • increases in the near-term, and contribute to overload conditions in the southern portion of Elliott Bay in particular. Cargo Handling High; although certain types of electric CHE High; electrification of CHE is expected to • Equipment (CHE) such as yard trucks are widely available, result in significant load growth, surpassing many types are still being evaluated. shore power as the largest demand at cargo terminals. • Deployment of hydrogen fuel cell CHE at scale will require hydrogen supply and CHE will contribute to overload conditions at fueling infrastructure, which is anticipated, multiple sites. but 3-5 years away. EV Charging (fleet, Low; EV technology is mature for most Medium; while EV charging demands are • public, and ground types of passenger fleet vehicles and currently small relative to other use categories, transport) options are emerging for medium- and the rapid growth in this category over time will heavy-duty weight classes. Port fleet assets result in overload conditions. Locating fleet are being replaced with EVs at retirement. and public EV infrastructure is also expected EV charging equipment may present siting to be challenging. and space challenges. Harbor Vessels High; full electrification is currently only High; charging for harbor vessels represents • suitable for a subset of harbor vessels, and the second-largest contributor to peak all-electric or hybrid electric tugs have not demand after shore power. Harbor vessel been deployed in Puget Sound. electrification at Port and Near-port sites will Technological fit and readiness, high capital drive the need for significant electrical • costs, and regulatory uncertainty are key infrastructure upgrades (Terminal 46 North, challenges. Pier 16-17). Buildings Recommendation Buildings are not a major contributor to overall port load growth. Continue to evaluate opportunities to increase efficiency and reduce overall site loads. Solar PV should be assessed, prioritized, and implemented. Where costeffective, efficiency is a no-regrets measure that will help reduce overall loads. Monitor shore power data at Terminal 5 to refine forecasts and design for T18, T30, and T46. Continue to monitor developments for the USCG site and adjust load forecasts as appropriate. Work with marine terminal operators to sponsor grant applications to reduce costs of CHE deployment. Coordinate early planning for siting of charging infrastructure on terminal to identify barriers and reduce deployment delays. Consider managed charging, off-peak charging, and batteries to reduce coincidence of EV charging and other loads (e.g., CHE charging, shore power). Consider support for early deployments of electric and hybrid electric harbor vessels to demonstrate feasibility in Puget Sound operating conditions. Shared-use charging infrastructure on Portowned properties may facilitate deployment multiple vessels. Page 230 of 373 • Refrigeration plugs Low; reefer plugs are technologically (eTRUs) mature and available at Port terminals. Truck and Motorcoach Charging High; zero-emission trucks and motorcoaches are currently at a significant cost premium relative to conventional vehicles, and operational characteristics such as range, duty cycles and a lack of available space for charging on terminals may further impede deployment. Low; reefer plug loads are expected to • increase over time in alignment with growth in cargo activity. Increases are anticipated to be limited relative to CHE electrification. High; the spot load sites that have been • identified as prospective truck charging locations (Harbor Island Right-of-way, West Marginal Way, and Terminal 25) are expected • to experience overload conditions or are in need of upgrades. Capital costs for necessary upgrades will depend on the design of the • facilities and extent of opportunity versus extended charging. • Ship-to-Shore Cranes (STS) Rail Low; electric STS crane technology is Low; Port terminals are already equipped with • already widely available. All STS cranes STS cranes and additional deployments are operating at the Port are electric. expected to occur gradually. Medium; zero-emission switcher Low; no on-terminal capacity constraints were • locomotives are not widely used but have identified for Terminal 86. Constraints on the recently become commercially available SCL feeder are primarily driven by Terminal with deployments in WA. Significant cost 91 load growth but can be alleviated by feeder premium vs diesel-fueled locomotives. Long upgrades in the near-term. • asset life means opportunities for adoption of new technologies are limited / infrequent. • Work with harbor vessel operators to sponsor grant applications to reduce risk of deployment. As heat pump technology improves, applications in TRUs should continue to be tracked and loads monitored. Importantly, TRUs are also a driver of cargo shore power loads. Continue to leverage private sector interest and investment in truck deployment models and charging infrastructure. Evaluate Port-owned properties as opportunities to reduce barriers to entry and initiate market transformation activities. Consider innovative business models such as trucking as a service and charging as a service with any deployment of charging infrastructure on Port-owned properties. Evaluate motorcoaches charging needs for maritime and aviation sites, consider charging site design capability at HD truck locations. Consider demonstration and deployment of capacitors, flywheels and other technologies to alleviate peak loads. The switcher locomotive at T86 is planned to be replaced with a Tier 4 locomotive, which will reduce GHG emissions by over 70% and criteria air pollutants by over 90%. Encourage use of renewable diesel to further reduce lifecycle GHG emissions. In the long-term, work with tenant to replace with all-electric once technology has been widely deployed. Table Legend Low barriers to deployment: Full implementation is planned and/or expected to be achievable in the nearterm with current technology, and current or planned infrastructure upgrades are sufficient to support electrification. Medium barriers to deployment: Full implementation will require minor to moderate levels of technological advancement and/or moderate levels of Port or utility infrastructure investment. High barriers to deployment: Full implementation will require high levels of technological advancement and/or high levels of infrastructure investment. Other barriers exist (siting, regulatory uncertainty, lack of business models, etc.) Page 231 of 373 Page 232 of 373 Page 233 of 373 Page 234 of 373 Page 235 of 373 Page 236 of 373 Page 237 of 373 Page 238 of 373 Page 239 of 373 Page 240 of 373 Page 241 of 373 Page 242 of 373 Page 243 of 373 Electrifying our Future Item No. 11b supp Meeting Date: April 22, 2025 Seattle Waterfront Clean Energy Strategy Briefing to Port of Seattle Commission April 22, 2025 1 Page 244 of 373 ZERO EMISSION PORT BY 2050 Premier global gateway driving sustainable commerce and travel North American hub for zero emission maritime and aviation transportation Future-ready for sustainable, resilient operations and infrastructure Health and prosperity for near-port communities 2 Page 245 of 373 Our Roadmap for Power: The Seattle Waterfront Clean Energy Strategy A roadmap for power infrastructure to support electrification of buildings, vehicles, vessels and equipment on Port-owned properties in the Seattle Harbor Partnership of Port of Seattle, Seattle City Light and NW Seaport Alliance Facilitate Port and Maritime Industry clean energy transition; focus on electrification Optimize City power grid resources Recommended strategies, business models & policies to support implementation Identify industry and port tenant interests and investment priorities. Develop industry partnerships and identify leading innovation projects  Reduce impacts to near-Port communities      3 Page 246 of 373 Seattle Waterfront Clean Energy Partnering Agreement • 10-year agreement, signed in 2021 • Port of Seattle, NWSA and Seattle City Light • Holistic planning approach • Innovative solutions for deployment • Framework for ongoing coordination and implementation 4 Page 247 of 373 Seattle Waterfront Clean Energy Strategy Vision and Alignment with Existing Plans A lasting partnership deploying clean energy infrastructure and driving equitable economic development for a zero-emissions working waterfront by 2050 Projects & Programs to Support Zero Emissions Transition Seattle Waterfront Clean Energy Strategy Port of Seattle & NWSA Implementation Plans: Port specific action plans Northwest Ports Clean Air Strategy: Vision and shared objectives for NW Ports Implementation & Investment Plans Foundational Policy Frameworks SCL Transportation Electrification Strategic Investment Plan: Priority program offerings in transportation electrification SCL Strategic Plan: Seattle City Light's Strategic Priorities 5 Page 248 of 373 Power Distribution System 6 Page 249 of 373 Core Elements of Waterfront Clean Energy Strategy Development Situational Assessment, Vision & Goals Baseline Inventory & Site Prioritization Demand Forecast Constraints Analysis Solutions Development Implementation Framework & Strategy Complete 7 Page 250 of 373 Site Analysis 8 Page 251 of 373 Forecasted Load Growth Power Demand by End-use, 2025-2050 (MW) 9 Page 252 of 373 Key Findings and Insights • Port power needs (peak electrical demand) expected to increase 4x by 2050 • Shore power is a key driver of near-term power demand • Port-adjacent sites are significant contributors to SCL's load growth • Both SCL and Port electrical infrastructure will face future constraints • Traditional infrastructure solutions are currently most cost-effective • Gaps: long-term planning, asset condition, and resiliency 10 Page 253 of 373 Recommendations 1. Power Infrastructure Investments 2. Strategic Implementation Actions 3. Joint Strategy Implementation Framework 11 Page 254 of 373 Recommendations | Power Infrastructure Investments • Plan for future capital: up to $457 million in port and utility investments through 2050 • On-terminal: $139 to $288m • Distribution System: $69 to $168m • Site planning, infrastructure assessments, financial planning to inform decision making and investment priorities. Consider in context of other POS priorities • Review near-term projects for inclusion in Port, NWSA and SCL CIPs • Coordinate timing of capital investments with NWSA and SCL 12 Page 255 of 373 Recommendations | Strategic Implementation Actions • Design for Future Electrification Capacity • Asset Condition Assessment • Identification of Critical Facilities for Resiliency • Integrate Power Needs with Site Master Planning • Infrastructure Management and Development • Increase Grant Project Readiness • Clean Technology Development • Innovative Business Models & Financial Strategies 13 Page 256 of 373 Recommendations | Joint Implementation Framework Seattle Waterfront Clean Energy Strategy Joint Implementation Framework Two Workstreams Site & Distribution Infrastructure Deployment Capital Improvement Plans (CIPs), long-lead planning, system capacity monitoring Project-level planning, permitting, design & construction End Use Electrification Deployment Industry engagement, technology assessment, project partnership development End use projects, clean tech pilot projects, supportive policy, grant funding 14 Page 257 of 373 Next Steps Consider near-term projects for CIP (Port, NWSA, SCL); coordination on long-lead projects Initiate site power master planning Evaluate incentives & business models for clean energy technologies Coordinate investments and grant planning with partners and industry Public engagement on SWCES and related projects 15 Page 258 of 373 Thank You 16 Page 259 of 373 COMMISSION AGENDA MEMORANDUM BRIEFING ITEM Item No. Date of Meeting DATE: April 4, 2025 TO: Stephen P. Metruck, Executive Director FROM: Dan Thomas, Chief Financial Officer Michael Tong, Director, Corporate Budget 11c April 22, 2025 SUBJECT: 2024 Financial Performance Briefing EXECUTIVE SUMMARY The purpose of this presentation is to provide a status report of the 2024 financial performance results. BACKGROUND The Port's overall operating revenues for 2024 were $1,040.1 million, which is $17.1 million above the budget and $70.9 million higher than 2023. Excluding Aeronautical revenues, which are based on cost recovery and revenue sharing formulas, other Airport Non-Aero revenues were $348.2 million, $15.5 million or 4.7% above the budget and $21.6 million or 6.6% higher than 2023 mainly due to higher revenues from Public Parking, Rental Cars, Airport Dining & Retails, and Clubs & Lounges. Non-Airport revenues were $174.2 million, $4.5million or 2.6% above the budget and $11.3 million or 6.9% higher than 2023 mainly due to higher revenues from Cruise, Grain, and NWSA Distributable Income. Total operating expenses for 2024 were $646.9 million, which is $29.5 million or 4.8% over budget and $96.0 million or 17.4% higher than 2023. The unfavorable budget variance was largely due to higher expenses in Payroll, Utilities, Supplies & Stock, Unanticipated Legal Expenses, and less Charges to Capital; partially offset by a $22.8 million DRS Pension True-up Credit. Net operating income before depreciation was $340.8 million, which is $16.7 million or 4.7% below budget and $19.8 million or 5.5% lower than 2023. Each division will present its results to the Commission. The presentation outline is as follows: 1. Aviation Division Operating Results 2. Maritime Division Operating Results Template revised April 12, 2018. Page 260 of 373 COMMISSION AGENDA - Briefing Item No. ____ Meeting Date: April 22, 2025 Page 2 of 2 3. Economic Development Division Operating Results 4. Central Services Operating Results 5. Portwide Operating Results ATTACHMENTS TO THIS BRIEFING (1) (2) 2024 Financial and Performance Report Presentation slides PREVIOUS COMMISSION ACTIONS OR BRIEFINGS August 13, 2024 - Q2 2024 Financial Performance Briefing Template revised September 22, 2016. Page 261 of 373 Item Number: Meeting Date: 11c attach_1_ April 22, 2025 PORT OF SEATTLE Q4 2024 FINANCIAL PERFORMANCE REPORT AS OF DECEMBER 31, 2024 Page 262 of 373 Q4 2024 FINANCIAL & PERFORMANCE REPORT 012/31/24 TABLE OF CONTENTS PAGE I. Portwide Performance Report 3-8 II. Aviation Division Report 9-15 III. Maritime Division Report 16-19 IV. Economic Development Division Report 20-22 V. Central Services Division Report 23-27 2 Page 263 of 373 I. PORTWIDE FINANCIAL & PERFORMANCE REPORT 12/31/24 I. PORTWIDE EXECUTIVE SUMMARY Passenger volume at SEA was 3.4% higher compared 2023 and 1.6% above the 2019 pre-pandemic volumes. The 2024 cruise season, representing the 25th year of cruises between Seattle and Alaska, ended on October 28 with 1.8 million revenue passengers. The Port's operating revenues for 2024 were $1,040.1 million, which is $17.1 million above the budget and $70.9 million higher than 2023. Public Parking, Rental Cars, Airport Dining & Retails, and Clubs & Lounges, Cruise, Fishing & Operations, Grain, and NWSA Distributable Revenue all exceeded revenue targets while Conference and Event Center, Employee Parking, and Ground Transportation were under budget. Operating expenses (with the non-cash expense credit related to the Port's public pension plans) were $646.9M, $29.5M or 4.8% higher than budget due to higher Payroll, Legal Expenses, Highline Water Settlement, Maintenance Materials, less Charges to Capital, $2.5M advanced payment to Seattle Aquarium, and $2.0M payment to Friends of the Waterfront. PORTWIDE FINANCIAL SUMMARY Actual Budget Actual 479,697 517,683 520,600 326,592 348,212 332,713 162,991 174,245 169,758 969,281 1,040,141 1,023,071 Actual vs. Budget Variance $ % (2,917) -0.6% 15,499 4.7% 4,487 2.6% 17,070 1.7% Change from 2023 Incr (Decr) $ % 37,986 7.9% 21,620 6.6% 11,254 6.9% 70,860 7.3% 490,431 (15,638) 474,793 579,607 (28,709) 550,899 669,661 (22,790) 646,871 617,406 617,406 (52,255) 22,790 (29,465) -8.5% 0.0% -4.8% 90,054 5,919 95,972 15.5% -20.6% 17.4% Depreciation NOI After Depreciation w/o Pension True-up 233,869 85,830 256,740 132,933 272,750 97,730 250,025 155,640 (22,725) (57,910) -9.1% -37.2% 16,009 (35,203) 6.2% -26.5% NOI After Depreciation with Pension True-up 101,467 161,642 120,520 155,640 (35,120) -22.6% (41,122) -25.4% 2022 2023 Actual 402,540 256,613 150,977 810,130 DRS Pension True-up Exp Total O&M Expenses with Pension True-up $ in 000's Aeronautical Revenues Airport Non-Aero Revenues Seaport Revenues Total Operating Revenues Total O&M Expenses w/o Pension True-up 2024 2024 2024 Actuals vs. 2024 Budget:  Airport Non-Aero Revenues were up $15.5M compared to budget mainly due to higher revenues from Public Parking, Rental Cars, Clubs and Lounges, and Airport Dining & Retail (ADR) & Terminal Leased Space.  Seaport Revenues were $4.5M above budget mainly due to higher NWSA Distributable Revenue, Cruise, Fishing & Operations, partially offset by lower revenues from Conference & Event Centers.  Total Operating Expenses (without the non-cash expense credit related to the Port's public pension plans) were $52.3M higher than budget due to higher Payroll, Legal Expenses, and less Charges to Capital. 2024 Actuals vs. 2023 Actuals:  Total Operating Revenues were up $71.0M compared to 2023 mainly due to higher revenues in most NonAeronautical lines of businesses (with the exception of Employee Parking and Ground Transportation), Grain, Maritime Portfolio Management, Conference & Event Center, and NWSA Distributable Revenue.  Total Operating Expenses (without the non-cash expense credit related to the Port's public pension plans) were $90.1M higher compared to 2023 due to higher Payroll, Outside Services, $2.5M payment to Seattle Aquarium, $2.0M payment to Friends of the Waterfront, and higher Legal Expenses. 3 Page 264 of 373 I. PORTWIDE FINANCIAL & PERFORMANCE REPORT 12/31/24 SEAPORT FINANCIAL SUMMARY $ in 000's NWSA Distributable Revenue Maritime Revenues EDD Revenues SWU & Other Total Operating Revenues Total O&M Expenses w/o Pension True-up DRS Pension True-up Exp 2022 2023 2024 2024 Actual 55,353 71,534 17,799 6,291 150,977 95,481 Actual 57,685 82,410 17,215 5,681 162,991 110,345 Actual 62,399 89,163 17,506 5,177 174,245 126,034 Budget 57,154 86,132 21,542 4,929 169,758 121,682 Actual vs. Budget Variance $ % 5,244 9.2% 3,031 3.5% (4,036) -18.7% 248 5.0% 4,487 2.6% (4,352) -3.6% Change from 2023 Incr (Decr) $ % 4,714 8.2% 6,753 8.2% 291 1.7% (504) -8.9% 11,254 6.9% 15,689 14.2% (3,351) (5,137) (4,212) - Total O&M Expenses with Pension True-up Depreciation 92,129 39,524 105,208 42,141 121,821 39,625 121,682 37,020 4,212 (140) (2,605) 0.0% -0.1% -7.0% 925 16,614 (2,516) -18.0% 15.8% -6.0% NOI After Depreciation w/o Pension True-up 15,973 10,506 8,586 11,056 (2,470) -22.3% (1,920) -18.3% NOI After Depreciation with Pension True-up 19,324 15,643 12,798 11,056 1,742 15.8% (2,844) -18.2% 2024 Actuals vs. 2024 Budget  Seaport Operating Revenues were up $4.5M compared to budget mainly due to higher NWSA Distributable revenue, Cruise, Fishing & Operations, partially offset by lower revenues from Conference & Event Centers.  Seaport Operating Expenses (without the non-cash expense credit related to the Port's public pension plans) were $4.4M higher than budget because of higher Payroll, Highline Water Settlement, Maintenance Materials, Legal Expenses, and less Charges to Capital. 2024 Actuals vs. 2023 Actuals  Seaport Operating Revenues were $11.3M higher compared to 2023 because of higher revenues from Grain, NWSA Distributable Revenue, Recreational Boating, and Maritime Portfolio Management.  Seaport Operating Expenses (without the non-cash expense credit related to the Port's public pension plans) were $15.7M higher than 2023 due to higher Payroll, Outside Services, $2.5M payment to Seattle Aquarium, $2.0M payment to Friends of the Waterfront, and higher Legal Expenses. 4 Page 265 of 373 I. PORTWIDE FINANCIAL & PERFORMANCE REPORT 12/31/24 MAJOR OPERATING REVENUES SUMMARY Budget 520,600 Actual vs. Budget Variance $ % (2,917) -0.6% Change from 2023 Incr (Decr) $ % 37,986 7.9% 116,626 45,399 20,872 81,612 23,946 10,462 21,744 9,578 16,709 43,145 16,555 11,771 5,920 11,762 9,993 7,490 62,399 6,474 522,457 111,036 42,201 19,399 78,088 25,333 11,656 20,496 10,089 12,024 41,057 16,468 10,715 5,191 12,697 10,363 11,156 57,154 7,348 502,471 5,590 3,198 1,473 3,524 (1,387) (1,195) 1,249 (511) 4,686 2,088 87 1,056 729 (935) (370) (3,666) 5,244 (874) 19,986 5.0% 7.6% 7.6% 4.5% -5.5% -10.3% 6.1% -5.1% 39.0% 5.1% 0.5% 9.9% 14.0% -7.4% -3.6% -32.9% 9.2% -11.9% 4.0% 5,637 (1,107) 3,917 7,366 (932) (112) 1,375 912 5,000 1,419 1,050 131 2,564 1,499 (472) 752 4,714 (837) 32,874 5.1% -2.4% 23.1% 9.9% -3.7% -1.1% 6.7% 10.5% 42.7% 3.4% 6.8% 1.1% 76.4% 14.6% -4.5% 11.2% 8.2% -11.4% 6.7% 1,040,141 1,023,071 17,070 1.7% 70,860 7.3% 2022 2023 2024 2024 $ in 000's Aeronautical Revenues Actual 402,540 Actual 479,697 Actual 517,683 Public Parking Rental Cars - Operations Rental Cars - Operating CFC 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) 88,899 44,302 12,171 43,126 20,804 10,645 16,747 7,943 8,688 30,469 13,978 10,566 5,792 10,550 8,791 8,914 55,353 9,851 407,590 110,990 46,506 16,954 74,246 24,878 10,574 20,370 8,666 11,710 41,726 15,505 11,640 3,356 10,263 10,465 6,738 57,685 7,311 489,584 TOTAL 810,130 969,281 MAJOR OPERATING EXPENSES SUMMARY Actual vs. Budget Variance $ % (6,092) -2.9% (19,984) -11.6% 12,754 27.8% 26,942 14.4% (1,182) -3.6% (152) -1.3% (3,693) -39.8% 2,026 25.0% 1,611 11.1% (516) -7.7% (38,924) -198.6% (25,045) 24.4% (52,255) -8.5% Change from 2023 Incr (Decr) $ % 31,117 16.6% 23,808 14.2% 599 1.8% 21,408 15.4% 2,560 8.2% (834) -6.6% 27 0.2% 557 10.1% 2,030 18.6% 785 12.2% 18,703 47.0% (10,707) 16.0% 90,054 15.5% 2022 2023 2024 2024 $ in 000's Salaries & Benefits Wages & Benefits Payroll to Capital Projects Outside Services Utilities Equipment Expense Supplies & Stock Travel & Other Employee Expenses Third Party Mgmt Op Exp B&O Taxes Other Expenses Charges to Capital Projects/Overhead Alloc TOTAL w/o DRS Pension True-up Actual 159,305 146,887 27,020 116,405 31,202 12,039 11,549 4,400 8,985 5,406 21,353 (54,120) 490,431 Actual 187,197 167,928 32,448 139,389 31,226 12,624 12,956 5,511 10,930 6,431 39,824 (66,857) 579,607 Actual 218,314 191,736 33,047 160,797 33,786 11,790 12,983 6,068 12,960 7,216 58,527 (77,564) 669,661 Budget 212,222 171,752 45,801 187,740 32,604 11,637 9,290 8,095 14,570 6,700 19,603 (102,609) 617,406 DRS Pension True-up Credit (15,638) (28,709) (22,790) - 22,790 0.0% 5,919 -20.6% TOTAL w/ DRS Pension True-up 474,793 550,899 646,871 617,406 (29,465) -4.8% 95,972 17.4% 5 Page 266 of 373 I. PORTWIDE FINANCIAL & PERFORMANCE REPORT 12/31/24 PORTWIDE 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 Actual Actual Actual Budget Actual vs. Budget Variance $ % 810,130 80,785 88,284 24,461 7,451 153,764 38,116 (50,735) 1,152,256 969,281 82,313 95,681 24,657 6,681 19,192 36,309 94,541 1,328,655 1,040,141 85,885 99,364 24,896 6,389 3,491 94,282 81,374 1,435,822 1,023,071 86,665 99,886 24,899 6,996 3,193 63,421 64,541 1,372,672 17,070 (780) (522) (2) (607) 297 30,861 16,834 63,150 Expenses 1. O&M Expense 2. DRS Pension True-up Credit 3. Depreciation 4. Revenue Bond Interest Expense 5. GO Bond Interest Expense 6. Public Expense 7. Non-Op Environmental Expense 8. Other Non-Op Rev/Expense Total Special Item Change In Net Assets 490,431 (15,638) 233,869 140,838 11,877 8,282 1,296 58,630 929,585 222,671 579,607 (28,709) 256,740 146,686 10,162 20,869 10,056 944 996,356 332,299 669,661 (22,790) 272,750 150,418 14,365 11,150 2,747 13,273 1,111,573 91,107 233,142 617,406 250,025 162,463 15,819 27,020 14,800 1,745 1,089,278 283,394 (52,255) 22,790 (22,725) 12,045 1,455 15,870 12,053 (11,528) (22,296) (91,107) (50,252) 2022 2023 2024 2024 Explanation 1.7% -0.9% In line with budget -0.5% In line with budget 0.0% In line with budget -8.7% In line with budget 9.3% In line with budget 48.7% Maily due to more Non-Capital Incentives than budgeted 26.1% Maily due to more Investment Interest Income than budgeted 4.6% -8.5% Mainly due to higher Env Remediation Exp. 0.0% Unbudgeted DRS pension credit -9.1% More new assets came into service 7.4% Less issue new bonds 9.2% In line with budget 58.7% Mainly due to less Non-Constructions 81.4% Less Non-op Environmental than budgeted -660.8% Mainly due to unbudgeted Gain/Loss Sale Of Assets -2.0% 0.0% Unbudgeted Special Item -17.7% KEY PERFORMANCE METRICS 2023 Total Passengers (in 000's) Landed Weight (lbs. in millions) Passenger CPE (in $) Grain Volume (metric tons in 000's) Cruise Passenger (in 000's) Shilshole Bay Marina Occupancy 2024 Fav (UnFav) Incr (Decr) Act vs. Budget Change from 2023 Variance Budget Chg. % Chg. % 52,914 274 0.5% 1,755 3.4% 32,726 (80) -0.2% 741 2.3% 18.31 0.17 0.9% 0.62 3.5% 3,730 (690) -18.5% 1,740 64.9% 1,661 (91) -5.4% (26) -1.5% 96.4% -1.7% -1.7% 0.0% 0.0% 2024 Actual Actual 50,885 52,641 32,064 32,806 17.52 18.14 2,680 4,420 1,778 1,752 98.1% 98.1% 6 Page 267 of 373 I. PORTWIDE FINANCIAL & PERFORMANCE REPORT 12/31/24 KEY BUSINESS EVENTS The Port renewed the Memorandum of Understanding (MOU) with Washington Maritime Blue. This long-standing collaboration will continue to advance the maritime businesses in a global marketplace, create living wage jobs, and support an innovative hub to reinforce Washington's position as a leader in maritime innovation and sustainability. The Port and Washington Maritime Blue will work on the launch of the Maritime Innovation Center (MInC) at the Port's Fishermen's Terminal, which will serve as a hub for emerging maritime companies. Another initiative under this collaboration is the Quiet Sound which includes the installation of hydrophones, which will monitor underwater noise levels and support efforts to protect the endangered Southern Resident killer whales. Commission authorized $14 million for the second iteration of the South King County Community Impact Fund (SKCCIF) program over the next five years. This fund will continue to advance projects in the historically underresourced, ethnically and culturally diverse communities that surround Seattle-Tacoma International Airport (SEA). The program will be expanded to include areas of King County that the Port of Seattle's Equity Index identifies as having the greatest disparities. Shore power installation project was completed at the Bell Street Cruise Terminal at Pier 66. The Port invested $44 million to equip all three cruise berths with shore power making Seattle one of the first cruise ports to offer shore power for simultaneous use at all its multiple berths. This technology allows ships to plug into the Seattle City Light grid and turn off their fuel-based engines, resulting in a significant reduction in air emissions and improving air quality. Additionally, the Port led the way to become the first port in the nation to require shore power usage by homeported cruise vessels, starting in the 2027 cruise season. Commission directed staff to develop a plan to help address the commuting needs of the more than 20,000 SeattleTacoma International Airport (SEA) workers. This order comes after the adoption of a Ground Transportation Access Plan (GTAP) in 2019 which directed the Port to form SEA MOVES and committed SEA to transportationrelated goals such as decreasing commuter trips in single-occupancy vehicles. The order approved five new programs for 2025 which includes a pilot program to evaluate the benefits of providing ORCA transit passes to a representative group of eligible airport workers, as well as a study of a potential employee bus shuttle. Similarly, the Port will explore the possibility of implementing health care requirements for the more than 20,000 SEA workers in a two-phase approach. The latest commission order seeks to understand how enhancing worker benefits can improve overall airport operations, including safety and customer service which ultimately advance the airport's goal of achieving a five-star Skytrax rating and higher competitiveness. SEA is currently a four-star Skytrax airport. The study will conclude in mid-2025 which will determine whether a policy directive will be considered next year and will be part of phase 2. The Port announced 13 new dining and retail concepts with 10 concessionaires selected for SEA's C Concourse Expansion set to open in 2026. The concessionaires were selected after a thorough, and fair evaluation process with six rating criteria: background/experience and financial capability, concept development and customer experience, unit design and materials, financial offer, management/staffing and operations, and job quality/workforce development. The selection process included external independent facilitation and observation. Commission authorized an order establishing the goal of permanently designating North SeaTac Park (NSTP) for recreational use. The Port has worked with U.S. Senator Maria Cantwell, U.S. Representative Adam Smith, and the rest of the Washington congressional delegation to include language amending the 2024 Federal Aviation Administration Reauthorization Act. The Port, in partnership with Federal Aviation Administration (FAA), published the National Environmental Policy Act Environmental Assessment of the airport's Sustainable Master Plan, a set of 31 near-term projects that will improve efficiency, safety, access to the airport, and support facilities for airlines and the airport. 7 Page 268 of 373 I. PORTWIDE FINANCIAL & PERFORMANCE REPORT 12/31/24 CAPITAL SPENDING SUMMARY $ in 000's 2024 2024 2024 Actual Budget Plan of Finance Budget Variance $ % Aviation 683,833 682,384 717,598 1,449 0.2% Maritime 81,062 72,976 84,825 8,086 11.1% Economic Development 3,780 5,137 20,501 (1,357) -26.4% Central Services & Other (note 1) 10,511 20,716 19,742 (10,205) -49.3% TOTAL 779,186 781,213 842,666 (2,027) -0.3% Note: (1) "Other" includes 100% Port legacy projects in the North Harbor and Storm Water Utility Small Capital projects. PORTWIDE INVESTMENT PORTFOLIO During the fourth quarter of 2024, the investment portfolio earned 3.82% versus the benchmark's (the Bank of America Merrill Lynch 1-3 Year US Treasury & Agency Index) of 4.26%. Over the last twelve months, the portfolio and the benchmark have earned 3.80% and 4.37%, respectively. Since the Port became its own Treasurer in 2002, the life-to-date earnings of the Port's portfolio and the benchmark are 2.42% and 2.00%, respectively. 8 Page 269 of 373 II. AVIATION DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 II. AVIATION DIVISION FINANCIAL SUMMARY Actual vs. Budget Variance Incr/(Decr) Change from 2023 2022 2023 2024 2024 Actual Actual Actual Budget Aeronautical Revenues Non-Aeronautical Revenues Total Ope rating Revenues 402,540 256,613 659,153 479,697 326,592 806,289 517,683 348,212 865,896 520,600 332,713 853,313 (2,917) 15,499 12,582 -0.6% 4.7% 1.5% 37,986 21,620 59,606 7.9% 6.6% 7.4% Total Ope rating Expenses w/o Pension True-Up 394,990 (12,286) 382,704 276,449 469,263 (23,572) 445,691 360,598 543,627 (18,577) 525,050 340,846 495,724 495,724 357,589 (47,903) 18,577 (29,325) (16,743) -9.7% DRS Pension True-Up Expense Total Ope rating Expenses w/ Pension True-Up Net Operating Income 74,365 4,994 79,359 (19,753) 15.8% -21.2% 17.8% -5.5% CPE Non-Ae ro NOI ($ in 000s) Enplaned passengers (in 000s) 16.09 135,483 22,966 17.52 189,063 25,371 18.14 187,548 26,265 18.31 179,075 26,457 (0.17) 8,473 (192) -0.9% 4.7% -0.7% 0.62 (1,516) 893 - 3.5% -0.8% 3.5% Capital Expenditures (in 000s) 311,631 444,072 683,833 682,384 (1,449) -0.2% 239,761 54.0% Financial Summary ($ in 000's) $ % $ % Operating Revenue -5.9% -4.7% 2024 Actuals vs. 2024 Budget Net Operating Income (NOI) including Pension True-up impact, was ($16.7M) or (4.7%) lower than 2024 budget. This shortfall was driven by higher operating expenses. Key Drivers:  Aeronautical Revenues were ($2.9M) or (0.6%) below budget, primarily due to: o Significant O&M overruns, particularly in legal expenses and internal cost allocations. o These increased costs were partially offset by grants, settlements, and a pension credit, bringing the total cost recovery lower than expected for the year.  Non-Aeronautical Revenues came in $15M or 4.7% higher than budget. Growth continued across several business lines: o Parking and Rental Car revenues outperformed expectations, reflecting sustained demand and higher utilization rates. o Port-owned Clubs & Lounges and Airport Dining & Retail also exceeded budget, benefiting from strong passenger volumes and continued recovery in travel spending.  Total Operating Expenses exceeded budget by ($29M) or (5.9%), driven by: o Increased contract rates and retroactive pay for contract negotiations completed during 2024. o Higher-than-anticipated costs in Environmental Remediation Liabilities. o Increased legal service charges and policing costs, particularly related to airport operations and support services. 2024 Actuals vs. 2023 Actuals Net Operating Income for 2024 was ($19.8M) or (5.5%) lower than the prior year, including the impact of the year-end Pension True-up.  Higher Operating Revenue of $59.6M or 7.4% compared to the prior year was driven by increased revenue from both Aeronautical and Non-Aeronautical sources.  Higher Operating Expenses, including the Pension True-up impact, of $79.4M or 17.8% compared to the prior year. This increase was primarily driven by higher Payroll, Outside Services, and Charges from Other Divisions. The impact of DRS Pension True-Up was lower in 2024 by ($5M) compared to 2023. 9 Page 270 of 373 II. AVIATION DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 A. BUSINESS EVENTS  Passenger levels exceeded pre-pandemic volume for the first time since 2019 by 1.6%, from 51.8M to 52.6M.  New international airlines services at SEA: o Delta Air Line's service to Taipei, Taiwan o Lufthansa's service to Munich, Germany o Hainan Airlines' service to Chongqing, China and Taipei, Taiwan o Alaska Airlines' service to Toronto, Canada and Liberia, Costa Rica o Philippine Airlines' service to Manila, Philippines  Reserved Parking launched at SEA B. KEY PERFORMANCE METRICS 2022 2023 2024 % Change from 2023 Total Passengers (000's) Domestic International Total 41,582 4,382 45,964 45,090 5,796 50,885 46,052 6,589 52,641 2.1% 13.7% 3.4% Operations 401,351 422,497 434,321 2.8% Landed Weight (In Millions of lbs.) Cargo All other Total 2,745 26,333 29,079 2,748 29,317 32,064 2,774 30,032 32,806 1.0% 2.4% 2.3% Cargo - Metric Tons Domestic freight International & Mail freight Total 335,514 120,777 456,291 305,141 111,986 417,127 345,181 114,882 460,063 13.1% 2.6% 10.3% 10 Page 271 of 373 II. AVIATION DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 Key Performance Measures 2022 2023 2024 2024 Actual Actual Actual Budget Actual vs. Budget Variance Incr/(Decr) Change from 2023 $ % $ % (0.17) 8,473 -0.9% 4.7% 0.62 (1,516) 3.5% -0.8% Key Performance Metrics Cost per Enplanement (CPE) Non-Aeronautical NOI (in 000's) 16.09 135,483 17.52 189,063 18.14 18.31 187,548 179,075 17.20 11.17 193 2.64 457 18.60 12.87 166 2.02 507 20.70 13.26 157 1.90 517 18.74 12.58 136 1.88 517 (1.96) 0.68 (22) 0.02 0 -10.5% 5.4% -16.1% 1.1% 0.0% 2.10 0.39 (9) (0.12) 10 11.3% 3.0% -5.3% -5.9% 2.0% 22,966 45,964 25,371 50,885 26,265 52,641 26,457 52,914 (192) (274) -0.7% -0.5% 893 1,755 3.5% 3.4% Other Performance Metrics O&M Cost per Enplanement Non-Aero Revenue per Enplanement Debt per Enplanement (in $) Debt Service Coverage Days cash on hand (17 months = 517 days) Activity (in 000's) Enplanements Total Passengers Key Performance Metrics 2024 Actuals vs. 2024 Budget  Cost per Enplanement (CPE) was $18.14 or 0.9% lower than budgeted CPE of $18.31.  Non-Aeronautical NOI was $8.5M or 4.7% higher than budget due to strong performance in Parking and Rental Car, as well as significant growth in Port-owned Clubs.  Total enplanements and passengers were both lower than budgeted by (192) and (274), respectively. 2024 Actuals vs. 2023 Actuals  In 2024, SEA experienced an increase in both enplanements and total passengers compared to 2023. Cost per Enplanement (CPE) and O&M Cost per Enplanement also rose by $0.62 and $2.1 respectively.  Non-Aeronautical NOI saw a decrease of ($1.5M) or (0.8%) while non-Aeronautical revenue per enplanement increased by $0.39 or 3%.  Debt per enplanements decreased by ($9) or (5.3%) and slightly improve days cash on hand to 517 days for 2024 from 507 days for 2023.  Total enplanements and passengers were both higher for 2024 by 893 and 1,755 respectively. 11 Page 272 of 373 II. AVIATION DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 C. OPERATING RESULTS Division Summary - YTD Actuals 2022 2023 2024 2024 Actual vs. Budget Variance Actual Actual Actual Budget $ 168,389 75,700 22,880 15,141 282,110 193,130 87,364 23,285 17,655 321,434 220,728 103,263 25,543 21,440 370,975 210,530 (10,198) 126,888 23,625 23,938 (1,606) (9,402) (30,842) 351,954 (19,021) Total Exceptions (1,274) 2,356 1,081 13,017 480 13,497 2,600 553 3,153 Total Airport Expenses 283,191 334,931 374,128 352,111 (22,017) -6.3% 39,197 11.7% Maritime/Economic Development/Other 80,452 27,660 3,687 95,740 33,750 4,840 124,120 39,388 5,992 103,294 (20,826) 34,019 (5,369) 6,301 309 -20.2% 28,379 -15.8% 5,637 4.9% 1,151 29.6% 16.7% 23.8% Total Charges from Other Divisions 111,799 134,331 169,499 143,614 (25,886) -18.0% 35,168 26.2% Total Operating Expenses w/o Pension True-Up 394,990 469,263 543,627 495,724 (47,903) (12,286) (23,572) (18,577) - 18,577 382,704 445,691 525,050 495,724 (29,325) -9.7% 74,365 4,994 -5.9% 79,359 15.8% -21.2% 17.8% Total Airport Expense Summary ($ in 000's) % Incr/(Decr) Change from 2023 $ % Operating Expenses Payroll Outside Services Utilities Other Expenses Total Airport Direct Charges Environmental Remediation Liability Capital to Expense Corporate Police DRS Pension True-up Exp Total Operating Expenses w/ Pension True-Up 157 157 -4.8% 27,598 18.6% 15,899 -6.7% 2,258 328.0% 3,785 -5.4% 49,540 14.3% 18.2% 9.7% 21.4% 15.4% (2,443) -1556.1% (11,059) -85.0% (553) (172) -35.8% (2,996) -1908.5% (11,231) -83.2% Operating Expenses - 2024 Actuals vs. 2024 Budget Full year 2024 Total Operating expenses was $525M (including the $18.6M pension true-up), exceeding the budgeted amount of $496M by $29M or 5.9%. Before considering the pension true-up, the Total Operating expenses were $544M, $48M or 9.7% higher than the budget. The variance was driven by the following key areas:  Payroll: Actual payroll costs totaled $221M, exceeding the budget by $10M (4.8%). This variance is primarily due to higher wages and benefit costs, largely driven by new represented agreements that resulted in higherthan-expected retroactive increases. Additional contributing factors include increased non-exempt salaries and benefits, as well as higher wages and benefits in the Maintenance and Fire departments.  Non-Payroll: Non-payroll costs exceeded the budget by $12M, primarily due to an unbudgeted legal settlement and increased Environmental Remediation liability costs in support of capital projects. Operating Expenses - 2024 Actuals vs. 2023 Actuals The Operating expenses increased by $74M or 15.8% compared to 2023 primarily driven by higher Payroll, Outside Services, and Charges from Central Services. 12 Page 273 of 373 II. AVIATION DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 Aeronautical Business Unit Summary 2022 2023 2024 2024 Actual vs. Budget Variance Incr/(Decr) Change from 2023 Actual Actual Actual Budget $ $ Total Rate Base Revenues 118,240 17,211 220,399 29,347 385,197 142,797 26,118 251,892 41,214 462,020 169,606 32,086 278,228 14,841 494,761 153,782 31,816 274,654 41,326 501,578 15,824 270 3,573 (26,485) (6,817) 10.3% 0.8% 1.3% -64.1% -1.4% 26,810 5,968 26,336 (26,373) 32,741 18.8% 22.8% 10.5% -64.0% 7.1% Airfield Commercial Area Subtotal before Revenue Sharing 17,343 402,541 17,677 479,697 22,922 517,683 19,022 520,600 3,900 (2,917) 20.5% -0.6% 5,245 37,986 29.7% 7.9% Total Aeronautical Revenues 402,541 479,697 517,683 520,600 (2,917) -0.6% 37,986 7.9% Total Aeronautical Expenses 261,574 308,162 364,385 342,086 (22,299) -6.5% 56,223 18.2% Aeronautical NOI 140,967 171,535 153,298 178,514 (25,216) -14.1% (18,237) -10.6% Debt Service (80,554) 60,413 (144,395) 27,140 (157,518) (4,220) (154,613) 23,902 (2,905) (28,121) 1.9% -117.7% (13,122) (31,360) 9.1% -115.5% Aeronautical NOI ($ in 000's) % % Rate Base Revenues Airfield Movement Area Airfield Apron Area Terminal Rents Federal Inspection Services (FIS) Net Cash Flow Aeronautical - 2024 Actuals vs. 2024 Budget  Net Operating Income was $25.2M (14.1%) lower than budget driven by higher operating expenses from legal issues and higher cost allocations. Aeronautical - 2024 Actuals vs. 2023 Actuals  Net Operating Income was $18.2M (10.6%) lower than 2023, primarily because expenses increased at a higher rate than revenue. Revenue growth was lower in 2024 due to large offsetting grants/settlements, which impacted the reported figures despite underlying trends being typically comparable with Aero Cost Recovery. Slower passenger activity in 2024 also contributed to the reduced net operating income. Airline Rate Base Cost Drivers Impact on Aero Revenues Budget vs Actual $ % 2024 Actual 2024 Budget O&M Debt Service Before Offsets Debt Service PFC Offset Net Debt Service Amortization Space Vacancy TSA Operating Grant and Other Rate Base Revenues Commercial area 353,595 226,565 (91,643) 134,922 36,935 (2,041) (28,676) 494,734 22,922 331,860 225,815 (91,493) 134,322 36,873 (719) (758) 501,578 19,022 21,735 750 (150) 600 62 (1,322) (27,918) (6,844) 3,900 6.5% 0.3% 0.2% 0.4% 0.2% 183.9% 3681.8% -1% 21% Total Aero Revenues 517,657 520,600 (2,943) -1% $ in 000's (1) (1) O&M, Debt Service Gross, and Amortization do not include commercial area costs or the international incentive expenses 13 Page 274 of 373 II. AVIATION DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 2024 Actuals vs. 2024 Budget  Rate Based Revenue is $6.8M lower than budget based on overall cost increases offset by grants and other settlement reimbursements: o O&M - $21.7M higher primarily due to higher Legal Costs. Significant unbudgeted items included TSA Exit Lane Staffing and increases in Represented Payroll with retroactive contract negotiations. Additional cost increases were driven higher allocations of costs across the board including law enforcement support. These increases were partially offset by Aero share of year-end Pension Credit. o Net Debt Service - $0.6M higher due to very minimal changes. o TSA Operating Grant and Other - $27.9M higher reflecting additional grants and $28M IAF Settlement Reimbursement. Non-Aero Business Unit Summary Non-Aeronautical NOI Actual vs. Budget Variance Incr/(Decr) Change from 2023 2022 2023 2024 2024 Actual Actual Actual Budget Total Non-Aeronautical Revenues 88,899 56,473 20,804 36,581 8,688 45,168 256,613 110,990 63,460 24,878 65,952 11,710 49,602 326,592 116,626 66,271 23,946 73,703 16,709 50,957 348,212 111,036 61,599 25,333 71,332 12,024 51,389 332,713 5,590 5.0% 4,672 7.6% (1,387) -5.5% 2,372 3.3% 4,686 39.0% (432) -0.8% 15,499 4.7% 5,637 2,810 (932) 7,751 5,000 1,355 21,620 5.1% 4.4% -3.7% 11.8% 42.7% 2.7% 6.6% Total Non-Aeronautical Expenses 121,130 137,529 160,665 153,639 7,026 4.6% 23,136 16.8% 135,483 (4,338) 131,145 (33,065) 98,079 189,063 (7,686) 181,377 (27,096) 154,281 187,548 (10,174) 177,373 (43,887) 133,486 179,075 (7,385) 171,689 (44,482) 127,207 8,473 4.7% (2,789) 37.8% 5,684 3.3% 595 -1.3% 6,279 4.9% (1,516) (2,488) (4,004) (16,791) (20,795) -0.8% 32.4% -2.2% 62.0% -13.5% ($ in 000's) $ % $ % Non-Aeronautical Revenues Public Parking Rental Cars Ground Transportation Airport Dining & Retail Clubs and Lounges Other 1 Non-Aeronautical NOI Less: CFC Surplus Adjusted Non-Aeronautical NOI Debt Service Net Cash Flow (1) Includes Federal Relief for Concessions Non-Aeronautical Revenue - 2024 Actuals vs. 2024 Budget Full year 2024 Non-Aero Revenue was $15.5M (4.7%) favorable to budget:  Public Parking - $5.6M (5.0%) favorable to budget due to continued strong demand, including robust utilization of the parking reservation program.  Rental Car - $4.7M (7.6%) favorable to budget resulting from higher percentage of O&D passengers renting cars, continued higher than historical average rental costs, and slightly longer rental durations. These factors had favorable impact on both Rental Car concession revenue and CFC revenue.  Airport Dining & Retail - $2.4M (3.3%) favorable to budget due to steady growth across ADR ($2.0M), as well as strong growth in advertising revenue, partially offset by the delayed implementation of expanded Janitorial services revenue ($1.0M, note this item has a NOI neutral impact).  Clubs & Lounges revenue grew significantly in 2024 due to expanded hours in the common use lounges to service new international air service routes and accommodate more flying passengers.  Ground Transportation ended the year $1.4M below the budget primarily due to reduced trip fees for TNC operators ($1.0M) due to carbon reduction targets achieved. TNC operators earned deeper discounts on Dropoff Fees for increasing the ratio of electric vehicles in their fleet. Taxi revenue was also lower than budget ($0.3M) due to challenges tracking all taxi trip activity during the cyberattack recovery period in late-2024. 14 Page 275 of 373 II. AVIATION DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 Non-Aeronautical Revenue - 2024 Actuals vs. 2023 Actuals  Non-Aeronautical Revenue grew by $21.6M (6.6%) compared to prior year primarily due to the same factors explained above in the 2024 favorable performance compared to budget. D. CAPITAL RESULTS Capital Variance 2024 2024 2024 Actual 172,720 Budget 136,612 POF 106,366 $ 36,108 Checked Bag Recap/Optimization (2) 50,631 69,654 111,869 (19,023) -27.3% Widen Arrivals Roadway (3) 34,171 17,233 15,539 16,938 98.3% International Arrivals Fac-IAF (4) 18,052 7,281 4,809 10,771 147.9% MT Low Voltage Sys Upgrade (5) 36,379 25,860 26,000 10,519 40.7% C concourse Expansion (6) 75,135 85,192 109,662 (10,057) -11.8% 28,736 20,899 12,894 ASL Replacement (8) 4,770 11,397 - (6,627) -58.1% Parking Garage Elevators Moder (9) 1,793 6,596 4,775 (4,803) -72.8% Concourse A Lounge Expansion (10) All Other 39,386 43,500 47,748 (4,114) 222,060 258,160 419,857 (36,100) -14.0% Subtotal CIP Cashflow Mgmt Reserve 683,833 - 682,384 - 859,518 (141,920) 1,449 - 0.2% Total Spending 683,833 682,384 717,598 1,449 0.2% $ in 000's SEA Gateway (1) Airline Realignment (7) Budget vs. Actual 7,837 % 26.4% 37.5% -9.5% 1. Work was completed on schedule with minor scope additions. The Program was able to tighten up the typical 60 to 90 days lag between completion of work and the reimbursement submittal to allow approval of one more reimbursement request than originally forecast before the end of 2024. 2. Phase 2 Savings to Construction Contract Contingency wasn't assumed in the 2024 baseline; Phase 3 delays in Construction Start. 3. Contractor's updated schedule resulted in higher 2024 costs than forecasted. 4. Unplanned $14M for Claims Settlement & Legal costs. It was slightly offset by $3.3M for Delayed Const work & Soft Cost Underruns. 5. Contractor re-sequenced work and increased crew sizes accelerating the 2024 cashflow basis to $2.8M/Mo. 6. 2024 actual costs were lower than budget because Structural Demolition and Utility Relocation work production was slower than planned. Structural Steel erection re-sequencing is expected to mitigate some of the delay. 7. Delayed spending in previous months was realized in Q4 when the GCCM production and associated invoicing increased. 8. Due to uncertainties at the start of this hot status project, high margin was included in the ROM estimate. 9. Project progressed slower than expected, working to accelerate and rearrange the work. 10. Const. TRA reimbursement submittals required additional review time. Due to the substantial backlog of outstanding change orders, the processing time to review the change order documentation and standard request for reimbursements has created a processing and reimbursement delay. 15 Page 276 of 373 III. MARITIME DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 III. MARITIME DIVISION FINANCIAL SUMMARY (Excludes Pension Adjustments) 2022 Actual 2023 Actual 2024 Actual 2024 Budget Total Operating Revenues 71,534 82,410 89,163 86,132 3,031 4% 6,753 8% Total Operating Expenses 59,556 70,286 76,394 72,589 3,805 5% 6,108 8% Net Operating Income 11,978 12,124 12,769 13,543 (774) -6% 645 5% DRS Pension True-up Exp (2,396) (3,649) (2,985) 14,374 15,773 15,754 13,543 2,211 16% (19) 0% $ in 000's Total Operating Income w/o Pension True-up Actual vs. Budget Variance Change from 2023 Incr (Decr) 2024 Actuals vs. 2024 Budget  Operating Revenues $3M higher than budget primarily from higher cruise occupancy and grain volumes.  Operating Expenses $3M higher than budget from higher payroll expenses and unplanned legal expenses.  Net Operating Income $775K below budget.  Capital Spending of $81M or 111% of $73M budget. 2024 Actuals vs. 2023 Actuals  Operating Revenues $6.8M higher than 2023 with from higher cruise occupancy, grain volumes, commercial moorage, and first full year impact of T106 ground lease.  Operating Expenses $6.1M higher than 2023 driven primarily by increases in payroll expenses for represented and non-represented staff, higher equipment expenses, and for unplanned legal expenses.  Net Operating Income $645K higher than 2023 actual. Net Operating Income before Depreciation by Business $ in 000's Ship Canal Fishing & Operations Elliott Bay Fishing & Commercial Operations Recreational Boating Cruise Grain Maritime Portfolio Habitat All Other Total Maritime 2023 2024 2024 Actual (3,771) (2,827) (507) 25,601 1,235 (5,408) (1,057) (1,143) 12,124 Actual (3,768) (915) (521) 20,657 3,090 (3,623) (1,221) (932) 12,769 Budget (4,321) (1,692) 628 19,190 3,149 (2,810) (1,313) 712 13,543 Actual vs. Budget Change from 2023 Variance $ % $ % 554 13% 4 0% 777 46% 1,913 68% (1,149) -183% (15) -3% 1,467 8% (4,944) -19% (59) -2% 1,855 150% (813) -29% 1,785 33% 92 7% (164) -16% (1,643) -231% 212 19% (774) -6% 645 5% 16 Page 277 of 373 III. MARITIME DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 A. KEY PERFORMANCE METRICS Cruise Passengers in 000's 500 400 2023 Actual 300 2024 Budget 200 2024 Actual 100 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Grain Volumes in 000's 700 600 2023 Actual 500 2024 Budget 400 300 2024 Actual 200 100 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec 17 Page 278 of 373 III. MARITIME DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 B. OPERATING RESULTS $ in 000's Ship Canal Fishing & Operations Elliott Bay Fishing & Commercial Operations Recreational Boating Cruise Grain Maritime Portfolio Management Other Total Revenue Expenses Maritime (Excl. Maint) Economic Development Total Direct Maintenance Expenses Envir Services & Planning Seaport Finance and Cost Recovery Seaport Project Management Total Support Services IT Police Expenses External Relations Other Central Services Aviation Division / Other Total Central Services / Other Total Expense before Pension Adjustment Pension Adjustment Total Expense NOI excluding Pension Adjustment NOI Before Depreciation Depreciation NOI After Depreciation Excluding Pension Adjustment 2022 Actual 2023 Actual 4,592 5,975 13,978 30,469 5,792 10,550 179 71,534 5,076 6,564 15,505 41,726 3,356 10,263 (80) 82,410 19,984 5,603 25,586 12,829 750 912 882 15,373 2,961 3,854 1,483 9,931 366 18,597 59,556 (2,396) 57,160 11,978 14,375 17,980 (6,002) 24,423 4,855 29,278 15,424 1,289 1,072 1,654 19,439 3,375 4,803 1,663 7,751 329 17,920 70,286 (3,649) 66,637 12,124 15,773 18,300 (6,176) 2024 Actual 2024 Budget 5,169 6,602 16,555 43,145 5,920 11,762 10 89,163 Actual vs. Budget Variance $ % 4,984 185 4% 5,731 871 15% 16,468 87 1% 41,057 2,088 5% 5,191 729 14% 12,697 (935) -7% 4 6 165% 86,132 3,031 4% Change from 2023 $ % 93 2% 39 1% 1,050 6% 1,419 3% 2,564 43% 1,499 13% 90 941% 6,753 8% 23,678 5,206 28,884 16,756 1,756 1,514 2,328 22,353 3,787 5,258 2,009 10,817 302 22,172 76,394 (2,985) 73,409 12,769 15,754 19,465 (6,696) 24,640 963 6,326 1,120 30,966 2,082 14,983 (1,772) 1,718 (37) 1,653 139 3,117 788 21,471 (882) 4,128 341 4,929 (328) 2,158 149 8,633 (2,184) 304 2 20,152 (2,020) 72,589 (3,805) 0 72,589 (820) 13,543 (774) 13,543 (2,212) 17,531 (1,934) (3,988) (2,707) 4% 18% 7% -12% -2% 8% 25% -4% 8% -7% 7% -25% 1% -10% -5% (746) 352 (394) 1,332 467 442 674 2,915 412 455 346 3,066 (28) 4,251 6,108 -3% 7% -1% 8% 27% 29% 29% 13% 11% 9% 17% 28% -9% 19% 8% -1% -6% -16% -11% -68% 6,772 645 (19) 1,165 (520) 9% 5% 0% 6% -8% 2024 Actuals vs. 2024 Budget  Operating Revenues were $3,031K higher than budget driven by: o Ship Canal over $185K from higher monthly moorage occupancy and utility sales. o Elliott Bay Fishing over $871K due to new license agreements and longer than expected moorage of fishing vessels. o Recreational Boating over $87K from stronger than expected demand for moorage. o Cruise $2,088K over from higher than expected occupancies and early season billing at pre-agreement tariff rates. o Grain $729K over from higher volumes of soybean exports. o Maritime Portfolio Management $935K lower due to environmental remediation credit related to T106 ground lease.  Operating Expenses were $3,805K lower than budget: o Direct Expenses were $2,082K lower than the budget  Elliot Bay Fishing and Commercial $325K lower from bad debt recovery and utilities.  Recreational Boating $26K lower from lower salaries & benefits expenses due to fewer employee turnover, but partially offset by utilities over the budget  Cruise $163K over due to higher outside services for P66 construction traffic mitigation expenses.  Maritime Security $250K over budget, as T-46 and FT requested additional security services.  Maritime Marketing $283K below budget due to lower advertising, promotional, and outside services. 18 Page 279 of 373 III. MARITIME DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24  Maritime Portfolio Management $122K below budget from lower utilities and unspent outside services (TI/Broker Fees).  Division Administration is under budget by $239K from open positions and unspent budget for event and promotional expenses.  Capital to expense for cancelled projects resulted in unbudgeted expenses of $264K. o Total Support Services/Maintenance were $1.6M over budget primarily due to compensation project/retro pay and under allocation of staff costs to Maritime. Higher than expected material prices. o Total Central Services / Other were $2,020K over budget.  Net Operating Income (excluding depreciation and DRS Pension Adjustment) was $774K lower than budget. 2024 Actuals vs. 2023 Actuals  Operating Revenues were $6.8M higher than 2023 due to increase in grain volumes, the first full-year impact of T106 ground lease, and moorage rate increase.  Operating Expenses (before DRS Pension Adjustment) were $6,108K higher than 2023 actual driven primarily by payroll increases and unplanned legal expenses  Net Operating Income (before depreciation and DRS Pension Adjustment) was $645K higher than 2023 actual. C. CAPITAL RESULTS 2024 Actual $ in 000's P66 Shore Power T91 Berth 6 & 8 Redev FT Maritime Innovation Center P66 Fender Replacement MIC Electrical Replacements T91 New Cruise Gangway Sustainable Eval Framework Res HIM Dock-E Improvements MD Small Projects MD Fleet All Other Projects Subtotal CIP Cashflow Mgt - MD Total Maritime % of Capital Budget 2024 2024 POF Budget vs Forecast Budget $ % 23,874 25,085 27,752 (1,211) -5% 22,682 21,931 19,223 751 3% 9,227 7,384 14,789 1,843 25% 3,730 2,800 2,382 930 33% 1,931 2,203 411 (272) -12% 2,342 2,090 3,040 252 12% 0 2,000 2,000 (2,000) -100% 3,050 1,920 2,350 1,130 59% 1,358 2,340 2,234 (982) -42% 3,399 4,038 4,503 (639) -16% 9,469 15,449 30,341 (5,980) -39% 81,062 87,240 109,025 (6,178) -7% 0 (14,264) (24,200) 14,264 -100.0% 81,062 72,976 84,825 8,086 11% 111% 100% Note: POF (Plan of Finance) is the total estimated during the budget process. Comments on Key Projects with Significant Variances  FT Innovation Center - Additional workflow analysis through Forma resulted in the preorder of equipment that was originally planned to be purchased later.  HIM Dock-E Improvements - The contractor performing the dock fabrication finished sooner than originally projected.  All other projects - MD Video Camera Project ($1.3M) delayed due to cyber incident. 19 Page 280 of 373 IV. ECONOMIC DEVELOPMENT DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 IV. ECONOMIC DEVELOPMENT DIVISION FINANCIAL SUMMARY 2022 Actual 2023 Actual 2024 Actual 2024 Budget Total Operating Revenues 17,999 17,215 17,506 21,542 (4,036) -19% 291 2% Total Operating Expenses 23,571 25,494 26,777 30,669 (3,892) -13% 1,283 5% Net Operating Income (5,572) (8,279) (9,271) (9,127) (144) -2% (992) -11% (9,127) 837 -9% (1,178) -14% $ in 000's DRS Pension True-up Exp Total Operating Income w/o Pension True-up (629) (1,168) (981) (4,942) (7,111) (8,290) Actual vs. Budget Variance Change from 2023 Incr (Decr) 2024 Actual vs. 2024 Budget  Operating Revenues $4M unfavorable to budget due to lower volumes at the Conference & Event Center.  Operating Expenses $3.9M below budget due to variable cost impact of lower Conference Center volumes and unspent Outside Services expenses.  Net Operating Income $144K below budget.  Capital Spending 74% of $5.1M budget. 2024 Actual vs. 2023 Actuals  Operating Revenues $291K higher than 2023 with increases in Conference & Event Center.  Operating Expenses $1.3M higher than 2023 due to payroll increases and Conference & Event Center volumes and change in the EDD Grants from 1yr to 2yr cycle.  Net Operating Income $1.18M lower than 2023 actual. Net Operating Income before Depreciation by Business $ in 000's Portfolio Management Conference & Event Centers Tourism Small Business EDD Grants Env Grants/Remed Liab Total Econ Dev 2023 2024 2024 Actual (2,069) (3,706) (1,026) 0 (1,491) (333) (8,625) Actual (3,566) (3,589) (1,082) 0 (964) (424) (9,626) Budget (3,613) (2,430) (1,606) (50) (1,505) 78 (9,127) Actual vs. Budget Change from 2023 Variance $ % $ % 46 1% (1,498) -72% (1,159) -48% 117 3% 524 33% (56) -5% 50 0 541 36% 527 35% (501) 645% (91) -27% (499) -5% (1,001) -12% 20 Page 281 of 373 IV. ECONOMIC DEVELOPMENT DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 A. OPERATING RESULTS 2022 2023 2024 2024 $ 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 Diversity in Contracting Tourism EDD Grants Total EDD Initiatives Environmental & Sustainability Police Expenses Other Central Services Aviation Division Total Central Services & Aviation Actual 8,886 8,914 17,799 Actual 10,477 6,738 17,215 Actual 10,016 7,490 17,506 Budget 10,386 11,156 21,542 Actual vs. Budget Variance $ % (370) -4% (3,666) -33% (4,036) -19% 3,653 6,563 230 299 1,058 3,836 1,223 16,863 186 1,737 105 2,028 30 240 4,893 146 5,309 3,713 6,632 254 340 1,734 3,498 1,501 17,672 268 1,540 1,491 3,300 53 288 5,207 141 5,689 3,954 7,150 237 235 1,488 3,532 1,571 18,168 253 1,738 964 2,955 72 333 6,099 130 6,635 3,917 9,602 225 249 1,058 4,024 1,894 20,971 250 1,875 1,505 3,630 108 289 5,539 132 6,068 (37) 2,452 (12) 14 (430) 492 323 2,803 (3) 137 541 675 36 (44) (560) 2 (567) Total Expense before Pension Adjustment Pension Adjustment Total Expense with Pension Adjustment NOI Before Depreciation Depreciation 24,200 (629) 23,571 (5,772) 3,954 26,661 (1,168) 25,494 (8,279) 4,132 27,758 (981) 26,777 (9,271) 4,373 30,669 0 30,669 (9,127) 4,028 NOI After Depreciation (9,725) (12,411) (13,644) (13,154) Change from 2023 $ (461) 752 291 % -1% 26% -5% 6% -41% 12% 17% 13% -1% 7% 36% 19% 33% -15% -10% 1% -9% 242 518 (17) (105) (247) 34 70 496 (15) 197 (527) (345) 19 45 892 (11) 945 7% 8% -7% -31% -14% 1% 5% 3% -6% 13% -35% -10% 36% 16% 17% -8% 17% 2,911 981 3,892 (144) (346) 9% NA 13% -2% -9% 1,096 187 1,283 (992) 241 4% 16% 5% -12% 6% (490) -4% (1,233) -10% -4% 11% 2% 2024 Actuals vs. 2024 Budget  Operating Revenues were $4M unfavorable to budget primarily due to lower volumes than budgeted at Conference & Event Center.  Operating Expenses before Pension Adjustment were $3M below budget: o Portfolio Management $37K lower from lower Salary and Benefits due to unfilled position. o Conference and Event Center $2.4M lower from lower activity. o Economic Dev. Other over budget $430K from budgeted Levy grants (Community Business Connector) miscoded, should have been charged to Tax Levy cost center. o Marine Maintenance $492K lower primarily due to Maintenance Materials and Labor charges due to lower activity. o Maritime Expenses (Excl Maintenance) $373K lower due to timing of project spend primarily Small Works Construction Services and Contract Watchmen/Dispatchers. o EDD Initiatives $807K below budget due to decrease in Tourism and Marketing support contracts caused by adjustments in grant cycle from two year to one year to align with partner's budget cycles. Small Business underspent budget in outside services and budget for Community Development Fund Training. o All other expenses net to $2K under budget.  Net Operating Income was $490K under to budget. 2024 Actuals vs. 2023 Actuals  Operating Revenues were $291K higher than 2023 actual from fewer Conference & Event Centers event cancellations, and leases.  Operating Expenses before Pension Adjustment were $1.1M higher than 2023 actual: 21 Page 282 of 373 IV. ECONOMIC DEVELOPMENT DIVISION FINANCIAL & PERFORMANCE REPORT 12/31/24 Portfolio management $242K higher due to higher Outside Services and bad debt recovery in 2023. Conference and Event Centers $518K higher than 2023 due to variable costs associated with higher Conference and Event Center volumes. o Econ Division other $247K lower due to adjustments in grant cycles. o Central services up $1,000K from increased payroll  Net Operating Income was $1.23M lower than 2023 actual. o o B. CAPITAL RESULTS 2024 Actual $ in 000's T91 Uplands Dev Phase I P69 Underdock Utility Rplc P69 Public Video Wall WTCW Roof Replacement P69 Computer Room CRAC Repl T91 Ped Path and Bike Bridge EDD Tenant Improvements EDD Technology Projects CW Bridge Elev Modernizations P69 3rd Floor Terrace Repair All Other Projects Subtotal CIP Cashflow Mgmt Reserve Total Economic Development % of Capital Budget 2024 Budget 1,357 854 105 229 81 180 0 0 117 0 857 3,780 0 3,780 74% 2024 POF Budget vs Forecast 2,650 1,050 575 461 386 346 300 250 220 130 579 6,947 (1,810) 5,137 100% 18,409 600 725 83 529 1,350 300 250 0 775 6,204 29,225 (8,724) 20,501 $ (1,293) (196) (470) (232) (305) (166) (300) (250) (103) (130) 278 (3,167) 1,810 (1,357) % -49% -19% -82% -50% -79% -48% -100% -100% -47% -100% 48% -46% -100% -26% Note: POF (Plan of Finance) is the total estimated during the budget process. Comments on Key Projects  T91 Uplands - Procurement delay due to change in delivery methodology. Moved from design-build to Progressive design-build which protracts the design process  P69 Public Video Wall - Cost reduction using Port Engineering and PCS for construction vs. using outside contractor  P69 Computer Room CRAC - Procurement delay due to cyber disruption. 22 Page 283 of 373 V. CENTRAL SERVICES FINANCIAL & PERFORMANCE REPORT 12/31/24 V. CENTRAL SERVICES FINANCIAL SUMMARY Budget 163 120,940 40,538 19,488 180,967 - Actual vs. Budget Variance $ % 240 146.8% (31,078) -25.7% (6,153) -15.2% 2,154 11.1% (35,077) -19.4% 11,743 0.0% Change from 2023 Incr (Decr) $ % 619 -286.6% 40,650 36.5% 5,668 13.8% 3,093 21.7% 49,412 29.7% 2,736 -18.9% 180,967 (23,334) 52,148 2022 2023 2024 2024 $ in 000's Total Operating Revenues Core Central Support Services Police Engineering/PCS Total O&M Expenses w/o Pension True-up DRS Pension True-up Exp Actual 2,538 96,695 33,487 10,593 140,775 (6,666) Actual (216) 111,368 41,023 14,241 166,632 (14,479) Actual 403 152,018 46,691 17,334 216,044 (11,743) Total O&M Expenses with Pension True-up 134,110 152,153 204,300 -12.9% 34.3% 2024 Actuals vs. 2024 Budget  Operating Revenues favorable by $240K due primarily to reimbursable revenues from Police.  Operating Expenses (without the non-cash expense credit related to the Port's public pension plans) were $35.1M unfavorable to budget mainly due to higher Payroll, Equipment Expense, Supplies & Stock, Insurance Expense, Promotional Expenses ($2.5M payment to Seattle Aquarium and $2.0M payment to Friends of the Waterfront), and Legal Expenses; partially offset by lower Outside Services and Travel. 2024 Actuals vs. 2023 Actuals  Operating Revenues $619K above 2023 mainly due to higher reimbursable revenues from Police.  Operating Expenses (without the non-cash expense credit related to the Port's public pension plans) were $49.4M higher than 2023 mainly due to higher Payroll, Equipment Expense, Promotional Expenses, Outside Services, Property Rentals, and General Expenses in 2024; partially offset by lower Supplies & Stock. A. BUSINESS EVENTS  Executive Director presented on decarbonization during the Ports Authority Roundtable.  Received authorization for $14M the second iteration of the South King County Community Impact Fund (SKCCIF) program over the next five years.  Received the American Association of Port Authorities Lighthouse Award of Excellence in Economic Development Practices for the South King County Community Impact Fund.  Hosted a hybrid format town hall with more than 500 online participants and approximately 70 in-person attendees.  Commission presented the Port's activities and future plan at the State of the Port hosted by West Seattle Chamber State.  Celebrated the Muckleshoot Tribe's Tomanamus Community Day at the Muckleshoot Job Fair & Community Gathering.  Conducted the Data and Equity Workshop Series in partnership with We All Count with the goal to advance equity into data collection and analysis.  Participated in over 83 outreach events focused on local Port communities to promote jobs at the Port. The Port hired 58 high school interns and 54 post-secondary interns in 2024.  Conducted a total of 13 strategic planning and continuous process improvement classes.  Restored and strengthened systems impacted by cyber incident  Hosted SAMP Draft NEPA EA and Part 150 study public events  Received $3M Clean Ports EPA funding for planning  Finalized the Memorandum of Understanding to extend the 2025 Airport Parking tax offset to some bargaining units; incorporated Gender Neutral/Inclusive Title changes for Marine and Aviation Maintenance Contracts. 23 Page 284 of 373 V. CENTRAL SERVICES FINANCIAL & PERFORMANCE REPORT 12/31/24 B. KEY PERFORMANCE METRICS Century Agenda Strategic Objectives 2022 2023 2024 Responsibly Invest in the Economic Growth of the Region and all its Communities A. Job seekers placed in jobs at SEA Airport through the Employment Center 1,479 1,594 1,202 B. Number of SEA Airport tenants supported in finding employees 94 93 111 C. Employment Center training completions 573 1,012 867 D. K-12 Career Connected Learning: WFD engagement with teachers/faculty E. Community members entering employment in construction, maritime and 0 12 21 environmental sustainability F. Number of Job Openings Posted 53 70 96 355 336 285 G. Job applications received 13,990 18,830 17,753 H. Number of job interviews conducted 2,461 2,333 1,893 I. Number of new employees hired 557 495 405 J. Number of interns 104 133 123 K. Number of Veteran Fellows 6 5 3 L. Number of employees participating in Tuition Reimbursement 25 15 22 2,229 2,907 3,368 Merrill Lynch 1-3 Year US Treasury & Agency Index) C. Comply with Public Disclosure Act and respond in a timely manner 27.7% 2.62%/ 4.50% 803 27.0% 3.70%/ 4.34% 1,204 30.9% 3.82%/ 4.26% 1,339 D. Employee Development Class Attendees/Structured Learning 2,868 3,289 2,286 E. Total Recordable Incident Rate (previous Occupational Injury Rate) 3.72 4.16 3.11 F. Lost Work Day Rate (previously Days Away Severity Rate) 79.47 72.41 57.45 Become a Model for Equity, Diversity and Inclusion A. Employee participation in OEDI programming (Caucuses, Book Clubs, Town Halls, etc.) Be a Highly Effective Public Agency A. Central Services costs as a % of Total Operating Expenses B. Investment portfolio earnings versus the benchmark (the Bank of America 24 Page 285 of 373 V. CENTRAL SERVICES FINANCIAL & PERFORMANCE REPORT 12/31/24 C. OPERATING RESULTS Financial Summary Budget 163 Actual vs. Budget Variance $ % 240 146.8% Change from 2023 Incr (Decr) $ % 619 -286.6% 6,133 3,170 10,524 14,813 6,565 16,859 1,639 2,046 10,575 31,891 2,739 3,258 1,969 7,352 1,200 7,711 21,534 149,978 3,632 3,485 6,018 12,839 7,142 17,303 1,621 2,224 11,646 32,024 2,886 3,336 2,178 6,877 1,508 9,019 (4,990) 118,749 (2,502) 316 (4,506) (1,974) 577 443 (18) 178 1,071 133 147 78 210 (475) 308 1,308 (26,524) (31,230) -68.9% 9.1% -74.9% -15.4% 8.1% 2.6% -1.1% 8.0% 9.2% 0.4% 5.1% 2.3% 9.6% -6.9% 20.4% 14.5% 531.5% -26.3% 2,826 547 (150) 4,032 925 2,280 222 (74) 729 3,800 546 390 228 1,507 (195) 404 21,784 39,800 85.5% 20.8% -1.4% 37.4% 16.4% 15.6% 15.6% -3.5% 7.4% 13.5% 24.9% 13.6% 13.1% 25.8% -14.0% 5.5% -8680.8% 36.1% 41,023 46,691 40,538 (6,153) -15.2% 5,668 13.8% 129,332 151,201 196,670 159,287 (37,383) -23.5% 45,468 30.1% 6,654 3,939 10,593 8,254 5,987 14,241 10,062 7,272 17,334 11,739 7,749 19,488 1,677 477 2,154 14.3% 6.2% 11.1% 1,808 1,285 3,093 21.9% 21.5% 21.7% 795 795 1,189 1,189 1,535 1,535 2,192 2,192 656 721 29.9% 32.9% 347 347 29.2% 29.2% 56 140,775 1 166,632 499 216,044 180,967 (499) (35,077) 0.0% 0.0% -19.4% (1) 499 49,412 -100.0% 0.0% 29.7% 2022 2023 2024 2024 Actual 2,538 Actual (216) Actual 403 Executive Commission Legal External Relations Equity Diversity and Inclusion Human Resources Labor Relations Internal Audit Accounting & Financial Reporting Services Information & Communication Technology Information Security Finance & Budget Business Intelligence Risk Services Office of Strategic Initiatives Central Procurement Office Contingency Core Central Support Services 2,218 2,360 8,540 9,215 4,406 11,921 1,177 2,565 8,672 27,150 1,703 2,499 1,496 5,144 974 6,072 (268) 95,845 3,307 2,623 10,674 10,781 5,641 14,580 1,417 2,120 9,846 28,091 2,193 2,868 1,740 5,845 1,396 7,306 (251) 110,178 Police 33,487 Total Before Cap Dev & Environment $ in 000's Total Revenues Capital Development Engineering Port Construction Services Sub-Total Environment & Sustainability Environment & Sustainability Sub-Total Industrial Development Corporation Capital to Expense TOTAL w/o DRS Pension True-up DRS Pension True-up Credit TOTAL w/ DRS Pension True-up (6,666) (14,479) (11,743) - 11,743 0.0% 2,736 -18.9% 134,110 152,153 204,300 180,967 (23,334) -12.9% 52,148 34.3% 25 Page 286 of 373 V. CENTRAL SERVICES FINANCIAL & PERFORMANCE REPORT 12/31/24 2024 Actuals vs. 2024 Budget Excluding the non-cash expense credit related to the Port's public pension plans, Operating Expenses for 2024 were $35.1M above Budget due primarily to:  Executive - unfavorable variance of ($2.5M) primarily due to higher Promotional Expenses ($2.5M).  Commission - favorable variance of $316K primarily due to lower Payroll of $292K and Outside Services of $48K  Legal - unfavorable variance of ($4.5M) due to higher Outside Services ($3.8M) and Payroll of ($417K).  External Relations - unfavorable variance of ($2.0M) primarily due to higher Promotional Expenses of ($2.1M), offset by lower Outside Services of $137K.  Equity, Diversity, and Inclusion - favorable variance of $577K primarily due to lower Outside Services of $479K, Equipment Expense of $23K, and General Expenses of $18K.  Human Resources - favorable variance of $443K primarily due to lower Payroll of $1.1M, Outside Services of $503K, and Travel & Other Employee Expenses of $220K, offset by higher General Expenses of ($1.4M).  Labor Relations - unfavorable variance of ($18K) primarily due to higher Payroll ($42K); offset by lower Travel & Other Employee Expenses of $12K.  Internal Audit - favorable variance of $178K primarily due to lower Payroll of $154K and Outside Services $20K.  Accounting and Financial Reporting Services - favorable variance of $1.1M primarily due to lower Payroll of $824K, Outside Services $285K, and Travel & Other Employee Expenses of $40K, offset by higher General Expenses of ($107K).  Information & Communication Technology -favorable variance of $133K due to lower Outside Services of $3.1M and Travel & Other Employee Expenses of $91K, offset by higher Equipment Expense ($664K), higher Payroll ($2.4M) and less charges to Capital of $2.2M.  Information Security - favorable variance of $147K primarily due to lower Outside Services of $297K, offset by higher Payroll ($141K).  Corporate Finance & Budget -favorable variance of $78K primarily due to lower Outside Services of $257K, offset by higher Payroll of ($188K).  Business Intelligence - favorable variance of $210K primarily due to lower Outside Services of $176K and Travel & Other Employee Expenses of $80K, offset by higher Payroll ($51K).  Risk Services - unfavorable variance of ($475K) due to Insurance Expense of ($513K), offset by lower Outside Services $96K.  Office of Strategic Initiative - favorable variance of $308K primarily due to lower Payroll of $205K, Travel & Other Employee Expenses of $61K, and Outside Services of $31K.  Central Procurement Office - favorable variance of $1.3M primarily due to lower Payroll of $320K, Equipment Expense $535K, and Travel & Other Employee Expenses of $91K, offset by Outside services of ($83K).  Police - unfavorable variance of ($6.2M) primarily due to higher Payroll ($3.8M), General Expenses ($2.5M), Workers Compensation of ($126K); partially offset by lower Outside Services $322K and Travel $195K.  Engineering - favorable variance of $1.7M primarily due to lower Outside Services of $860K Equipment Expense of $222K, General Expenses of $152K, and Travel & Other Employee Expenses of $129K; offset by higher Property Rentals of $177K and Payroll of (1.8M) and less charges to Capital of $2.4M.  PCS - favorable variance of $477K primarily due to lower Payroll of $1.0M, offset by higher Outside Services ($856K) and General Expenses ($76K).  Environment & Sustainability Admin - favorable variance of $656K primarily due to lower Outside Services of $543K and Payroll of $113K.  Contingency - unfavorable variance of ($26.5M) primarily due to General Expenses. 26 Page 287 of 373 V. CENTRAL SERVICES FINANCIAL & PERFORMANCE REPORT 12/31/24 2024 Actuals vs. 2023 Actuals 2024 Operating Expenses (without the non-cash expense credit related to the Port's public pension plans) were $49.4M higher than 2023 actuals mainly due to:  Core Central Support Services - $40.6M higher than 2023 primarily due to: higher payroll for current employees and new positions; contractual increases; addition of new initiatives to support growing needs of the organization.  Police - $5.7M above 2023 due to: increase in wages and benefits, new positions, vacant positions in 2024, and addition of new initiatives to enhance the safety and security of the public.  Capital Development - $3.1M higher than 2023 primarily due to the addition of new positions as well as contractual increases to support the capital program. D. CAPITAL RESULTS 2024 $ in 000's Engineering Fleet Replacement Corporate Fleet Replacement Services Tech - Small Cap Infrastructure - Small Cap Enterprise Network Refresh ID Badge System Upgrade Radio Microwave Redundancy Loop Public Safety Dispatch & Police RMS Enterprise Firewall Refresh Physical Access Control System Refresh Office Wi-Fi Refresh Other (note 1) Subtotal CIP Cashflow Adjustment TOTAL 2024 Actual 643 269 1,155 799 1,741 1,068 305 567 483 10 643 1,771 9,454 9,454 2024 Plan of Budget Finance 3,716 1,890 1,189 920 1,623 1,500 1,500 1,500 2,600 2,600 2,551 2,550 2,272 1,973 950 1,720 1,550 1,460 1,250 1,100 1,565 1,000 5,052 5,916 25,818 24,129 (6,800) (6,200) 19,018 17,929 Budget Variance $ % (3,073) -82.7% (920) -77.4% (468) -28.8% (701) -46.7% (859) -33.0% (1,483) -58.1% (1,967) -86.6% (383) -40.3% (1,067) -68.8% (1,240) -99.2% (922) -58.9% (3,281) -64.9% (16,364) -63.4% 6,800 -100.0% (9,564) -50.3% Note: (1) "Other" includes remaining ICT projects and small capital projects/acquisitions. 27 Page 288 of 373 Item No. __11c_supp__ Date of Meeting: April 22, 2025 Port of Seattle Q4 2024 Financial Performance Report 1 Page 289 of 373 Key Highlights • SEA passenger volume was 3.4% higher compared 2023 and 1.6% above the 2019 pre-pandemic volumes • 2024 cruise season marked the 25th year of cruises between Seattle and Alaska ended with 1.8 million revenue passengers • Operating revenues were $17.1M or 1.7% above budget • Operating expenses were $29.5M or 4.8% over budget (with the $22.8M DRS pension credit) • Total capital spending was $779.2M, 0.3% below budget 2 Page 290 of 373 Aviation Division 2024 Q4 Financial Performance Report Page 291 of 373 Passenger Growth Rebounded 1.6% Growth compared to 2019 3.4% Growth compared to 2023 -0.5% Lower compared to Budget 4 Page 292 of 373 Financial Summary Business/Financial Highlights • Aero Revenues - $3M under budget, net impact of large operating expenses from legal matters and other allocations, offset by grants and the Int'l Arrivals Facility settlement the airport received. • Non-Aero Revenues - $15M over budget, continued strong performance overall, significant growth in Parking, Rental Car, Airport Dining & Retail, and Port-owned Club at SEA lounges. • Operating Expenses - $29M over budget due to increases in legal expenses, labor contracts, Police services at SEA, and environmental remediation liabilities. These over budget operating expenses were partially offset by the year-end pension credit. 5 Page 293 of 373 Key Drivers of Operating Expense Variance • Represented Payroll ($11.8M) - composed of higher contract rates and includes $7.4M in retro-pay for contract negotiations completed during 2024. • Highline Water District Settlement ($6.8M) • Environmental Remediation Liability (ERL) Expense ($2.4M) - higher ERL expenses primarily due to North Main Terminal Redevelopment/SEA Gateway ($1.3M) and Widened Arrivals ($1.1M) projects. • Legal Expenses ($18.4M) - airport share of legal expenses. • Increase in police services at SEA ($5.4) • WA State Dept. of Retirement Services Pension Credit $18.6M - airport share of overall $22.8M pension credit for year-end 2024. 6 Page 294 of 373 Operating Expenses Summary $29M or 5.9% over budget Components of Higher Operating Expenses:  Higher Airport Direct Expenses: ($22M) - due to higher payroll costs, Highline Water Settlement, and environmental remediation liabilities  Higher Charges from Other Divisions: ($26M) - due to legal costs and increased demand for Police services at SEA  Year-end Pension Credit: $19M - airport share of pension credit that partially offset higher operating expenses 7 Page 295 of 373 Aeronautical Revenues Actual $518M -$2.9M -0.6 % Budget $521M • Airfield Movement Area & Terminal impacted the most by increased legal expenses. • FIS has a large reduction in expenses due to the Int'l Arrivals Facility settlement paid to the airport. 8 Page 296 of 373 Non-Aeronautical Revenues Actual $348.2M $15.5M 4.7% Budget $332.7M • Strong performance in Parking and Rental Car, significant growth in Port-owned Club at SEA lounges, continued growth in Airport Dining & Retail 9 Page 297 of 373 Debt Service Ratio: Above 1.40x target in $000's 2023 Actual 2024 Actual 2024 Budget Variance Revenues Aero Non-aero Total Revenues 479,697 326,592 806,289 517,683 348,212 865,896 520,600 332,713 853,313 (2,917) 15,499 12,582 O&M (445,691) (525,050) (495,724) (29,325) Net Operating Income Federal Relief Grants Non-op Concession Rent Relief Grants CFC Excess Other net non-operating 360,598 1,855 1,918 (7,560) 15,920 340,846 (10,174) 52,270 357,589 (7,385) 23,623 (16,743) (2,789) 28,647 Available for debt service 372,731 382,941 373,827 9,114 Debt Service Gross debt service (net of cap i) CFC offset PFC offset Federal Relief Grants DS offset 308,981 (24,657) (91,427) (9,993) 326,295 (24,890) (100,000) - 323,985 (24,890) (100,000) - 2,310 - Net Debt Service 182,904 201,405 199,095 2,310 2.02 1.90 1.88 0.02 Debt Service Coverage Funds Available for Debt Service exceeded budget due to: • $15.5M increase in Non-aero revenues • $2.8M increase in Customer Facility Charge excess • $28M Int'l Arrivals Facility settlement the airport received Net Debt Service was $2.3M over budget due to lower-than-expected offsets from capitalized interest, reserve fund interest, and interest costs. Note: DS Coverage is airport only debt service coverage, calculated in accordance with airline agreement. 10 Page 298 of 373 $ in 000's Airport Development Fund Balance $760,000 Ending Balance, $743,355 $740,000 $41M higher than target $720,000 Target, $702,300 $700,000 $680,000 $660,000 $640,000 $620,000 $600,000 Beginning Balance, $655,058 Drivers of $41M higher ending fund balance include:  $27.6M higher 2023 non-aero revenues ending balance.  $13.4M higher net sources and uses of cash than target. • Contributions to Fund Balance o + $33M higher non-aero revenues (includes pre-paid reserve parking for future periods) o + $10M ARPA federal grant o + $47M lower cash spending for capital projects • Uses of Fund Balance o ($62.6M) higher operating expenses o ($20M) higher 2023 SLOA surplus credited to airlines SLOA = Signatory Lease Operating Agreement ARPA = American Rescue Plan Act 11 Page 299 of 373 2024 Capital Spending: 100.2% of Budget $684M $682M $600 SEA Gateway, $173 SEA Gateway, $137 $500 Checked Bag, $51 $ in Millions $700 Checked Bag, $70 C concourse, $75 C concourse, $85 A Conc, $39 A Conc, $44 $300 Business Need, $124 $200 Others, $17 SCE, 24 Regulatory, $27 Business Need, $109 Others, $19 SCE, 22 Regulatory, $39 R&R, $150 R&R, $152 $400 $100 Noise Prog, $4 $0 2024 Actual R&R: Renewal & Replacement 2024 Budget • SEA Gateway spent more than the budget. Work was completed on schedule with minor scope additions. Review of TRA invoices were completed quicker than anticipated. • Checked Baggage underspent due to savings in Phase 2 construction contract contingency and schedule delays on Phase 3. • C Concourse Expansion underspent because Structural Demolition and Utility Relocation work production was slower than planned. Structural Steel erection re-sequencing is expected to mitigate some of the Noise Prog, $5 delay. • No significant change in spending forecast for other projects 12 Page 300 of 373 AV Capital -2025 Spend Forecast $ in 000's Category Mega Total Business Need Total Renewal & Replacement Total Reserve/Cash Flow Adjustment Total Regulatory Total SAMP Design Total Noise Total Grand Total 2024 Actual 341,025 161,528 150,418 26,561 22 4,279 683,833 Project Categories: Mega: Projects with over $300M budget NSAT and IAF projects have been completed Business Need: Based on identified business need or opportunity Regulatory: Projects needed to meet regulatory requirements Renewal & Replacement: Projects to replace assets that are at the end of useful lives Noise: sound insulation projects SAMP Design: SAMP preliminary planning/design projects POF 2025 Budget 2025 as of Q2 2024 as of Q4 2024 500,328 371,327 198,372 287,372 250,583 177,489 (35,955) (70,879) 93,993 41,367 6,717 22,952 9,654 1,036,989 816,331 5Y Total 2,180,910 554,401 648,887 370,524 280,556 240,000 53,674 4,328,951 POF: Plan of Finance - a funding plan for the Port's five-year Capital Improvement Program (CIP). Budget 2025: Baseline for 2025 spending 13 Page 301 of 373 Seaport 2024 Q4 Financial Performance Report Page 302 of 373 Seaport Key Metrics - 2024 Cruise Calls and Passengers 3,500 35,000 3,000 30,000 2,500 25,000 2,000 20,000 1,500 15,000 1,000 10,000 500 5,000 - 2019 2020 2021 2022 Containerized Volume (TEUs) 2023 2024 2000 300 1500 250 200 1000 150 100 500 50 - 0 2019 2020 Cargo Volume (Metric Tons) 2023 2021 2022 Cruise Sailings 2023 2024 Cruise Passengers in 000s Grain Volumes in Metric Tons (000s) Occupancy at Shilshole Bay Marina 2022 Passengers in ooos 40,000 Calls 4,000 350 Cargo Metric Tons in 000s Container TEUs in 000s NWSA Container and Cargo Volumes 2024 Budget 5,000 2024 100% 99% 98% 97% 96% 95% 94% 93% 92% 4,000 3,000 2,000 1,000 Dec Nov Oct Sep Aug Jul Jun May Apr Mar Feb Jan 2019 2020 2021 Soybeans Yellow Corn 2022 2023 2024 Sorghum 15 Page 303 of 373 Seaport Performance Summary - 2024 Revenue • • • • 2022 2023 2024 2024 $ in 000's Maritime Economic Development Division Joint Venture Total Operating Revenues Actual 71,534 17,799 55,381 144,715 Actual 82,410 17,215 57,636 157,261 Actual 89,163 17,506 61,406 168,075 Budget 86,132 21,542 55,881 163,555 Actual vs. Budget Variance $ % 3,031 4% (4,036) -19% 5,525 10% 4,520 3% Maritime Economic Development Division Joint Venture Total O&M Expenses w/o Pension True-up 59,557 20,745 2,539 82,840 66,637 24,343 3,466 94,447 73,409 27,758 2,204 103,371 72,589 30,669 2,270 105,528 (820) 2,911 65 2,157 DRS Pension True-up Exp (3,303) (5,100) (4,207) 0 4,207 Total O&M Expenses with Pension True-up 79,537 89,346 99,164 105,528 6,364 NOI before Depreciation w/o Pension True-up 61,875 62,815 64,705 58,028 NOI before Depreciation with Pension True-up 65,178 67,915 68,912 Depreciation 36,678 37,008 NOI After Depreciation w/o Pension True-up 25,196 NOI After Depreciation with Pension True-up 28,500 Note: Totals exclude GASB 87 impact. Higher than budgeted cruise occupancy. Grain volumes up 65%. EDD: Conference Center - lower revenue to budget. Joint Venture - distributable income and T46 autos. Change from 2023 $ 6,753 291 3,770 10,814 % 6,772 3,414 (1,262) 8,924 10% 14% -36% 9% 893 18% 6% 9,818 11% 6,677 12% 1,890 3% 58,028 10,884 19% 997 1% 38,013 35,794 2,219 6% 1,004 3% 25,806 26,692 22,233 4,458 20% 886 3% 30,906 30,899 22,233 8,665 39% (8) 0% -1% 9% 3% 2% 8% 2% 7% 7% Expenses • • • • Unbudgeted legal expenses. Conference Center - lower expense to budget. Unbudgeted pension credit. Compensation Plan impacts. 16 Page 304 of 373 Maritime Division 2024 Q4 Financial Performance Report Page 305 of 373 Maritime Division Business Highlights Financial Summary Figure in $000s Revenues Fishing, Commercial, & Recreational Marinas Cruise Maritime Portfolio Mgmt. Grain / Other Total Actual Budget Variance 28,326 43,145 11,762 5,930 89,163 27,183 41,057 12,697 5,195 86,132 1,143 2,088 (935) 735 3,031 O&M Expense Direct Support Services Central Services and Other Total 28,884 22,353 22,172 73,409 30,966 21,471 20,152 72,589 Net Operating Income 15,754 Capital Spending 81,062 • • • Grain Volumes - 10th highest year ever. Cruise and Waterside Occupancy higher than planned. Maritime Portfolio Management - Revenue increases offset by unbudgeted environmental credit of $1.5M. 2,082 (882) (2,020) (820) • 13,543 2,211 72,976 (8,086) • • FT Maritime Innovation Center - Construction underway with first major milestone complete with building move. P66 Shorepower - Cable Positioning Device delivered. Entered into a purchase & sale agreement to sell 500 habitat credits. 18 Page 306 of 373 Stormwater Utility SWU Expenses - Unfavorable due to pay equity and outside services Marine Maintenance - Favorable $659K due charges diverted to industrial permit work 19 Page 307 of 373 Northwest Seaport Alliance Summary NWSA Operating Income Before GASB 87 Adjustment $ in 000's Operating Revenue Operating Expense Operating Income* Depreciation Net Operating Income 2023 Actual 238,438 106,637 131,801 21,288 110,513 Year-End 2024 Actual Budget 271,738 252,824 126,252 124,151 145,486 128,673 24,652 29,402 120,834 99,271 Cargo TEUs Cargo Volume (Metric Tons) 2,974,416 28,989,291 3,340,733 34,606,861 Fav (UnFav) Budget Variance $ % 18,914 7% (2,101) -2% 16,813 13% 4,750 16% 21,563 22% Incr (Decr) Change from 2023 $ % 33,300 14% 19,615 18% 13,685 10% 3,364 16% 10,321 9% 366,317 5,617,570 12.3% 19.4% *Excludes Depreciation Revenue Year to Date • Budget Variance - Non-Container lines of business above $7.8M, Container & Intermodal above $10.5M. • Y/Y Variance - Increased volumes and T5 Phase II expansion. Operating Expense Year to Date • Budget Variance - Under due to Maintenance project timing, specifically Pile Cap Repair at East Sitcum, partially offset by higher labor and other operating expenses. • Y/Y Variance - Higher from longshore and general inflation across the board. 20 Page 308 of 373 Joint Venture Q4 2024 Financials Fav (UnFav) Actual vs. Budget Variance $ % Incr (Decr) Change from 2024 $ % 57,154 (2,071) 55,084 5,244 165 5,409 9% -8% 10% 4,714 (41) 4,673 8% 2% 8% 527 386 632 165 (105) 221 -17% N/A (226) (677) -30% -64% 57,636 61,406 55,881 5,525 10% 3,770 6.5% 678 1,362 202 566 246 44 370 3,466 (283) 3,183 54,453 14,683 39,770 581 (547) 211 1,065 198 43 654 2,204 (241) 1,964 59,443 14,462 44,980 493 92 217 825 289 145 209 2,270 (88) 639 6 (240) 91 103 (444) 65 -18% 698% 3% -29% 32% 71% -212% 3% (96) (1,909) 9 499 (48) (1) 284 (1,262) -14% -140% 4% 88% -19% -3% 77% -36% 2,270 53,611 14,236 39,376 306 5,831 (227) 5,605 13% 11% -2% 14% (1,219) 4,989 (221) 5,210 -38% 9% -2% 13% 2023 2024 2024 Actual Actual Budget 57,685 (1,865) 55,820 62,399 (1,906) 60,493 Other Service Revenue Tenant Reimbursements Port Revenue from NWSA Facilities 753 1,063 Total Revenues Expenses Maintenance Expenses JV Direct Security Environmental & Sustainability Seaport Finance & Cost Recovery Waterfront PMG Central Services / Other $ in 000's Revenue NWSA Distributable Revenue Contra Joint Venture Revenue Subtotal Distributable Revenue from NWSA Total Expenses Pension Adjustment Total Expense w/out Pension Adjustment NOI Before Depreciation Legacy Depreciation for NWSA Facilities NOI After Depreciation Home Port Activities Revenues: • NWSA distributable revenue higher than budget due project spending less than budget in 2024 • Port Revenue from NWSA Facilities higher from unbudgeted autos at T46 Expenses • Expenses less than budget: • $746K environmental remediation liability credit at T5 for the deepening project. • $427K in legal expenses • $217K in bad debt expense 21 Page 309 of 373 Economic Development Division 2024 Q4 Financial Performance Report Page 310 of 373 Economic Development Division Financial Summary Business Highlights Figure in $000s Actual Budget Variance Revenues 17,506 21,542 (4,036) O&M Expense EDD & Maritime Maintenance Diversity in Contracting Tourism EDD Grants Central Services and Other Total 14,362 3,521 158 1,701 964 6,071 26,777 16,946 4,024 250 1,875 1,505 6,068 30,669 2,585 503 92 174 541 (2) 3,892 NOI (9,271) (9,127) (144) Capital Spending 3,780 5,137 1,357 • Portfolio Management maintained 90% occupancy. • Fewer event cancelations, increasing Conf. Event Center Revenues. • T91 Upland Redevelopment entering validation phase of progressive design build. • FT Maritime Innovation Center started construction in Q2 2024 • T106 Trammell Crow - 750K sf light industrial, 2-story distribution center delivered. • After completing due diligence for the STOC office portfolio, closed one of the largest real estate acquisitions in Port of Seattle history. 23 Page 311 of 373 Central Services 2024 Q4 Financial Performance Report Page 312 of 373 Central Services Business Highlights Financial Summary  $ in 000's Revenues Actual 403 Budget 163 Variance 240 Core Central Support Services Police Engineering/PCS Total O&M Expenses w/o Pension True-up 152,018 46,691 17,334 216,044 120,940 40,538 19,488 180,967 (31,078) (6,153) 2,154 (35,077) DRS Pension True-up Credit (11,743) - 11,743 Total O&M Expenses with Pension True-up 204,300 180,967 (23,334) Capital Spending 10,511 20,716 10,205    Commission presented the Port's activities and future plan at the State of the Port Received the American Association of Port Authorities Lighthouse Award of Excellence in Economic Development Practices for the South King County Community Impact Fund Celebrated the Muckleshoot Tribe's Tomanamus Community Day at the Muckleshoot Job Fair & Community Gathering Participated in over 83 outreach events focused on local Port communities to promote jobs at the Port. The Port hired 58 high school interns and 54 postsecondary interns in 2024 25 Page 313 of 373 Central Services Financial Highlights • 2024 Total Operating Expenses were $35.1M above budget due to higher Payroll, Promotional Expenses, and Legal Expenses; partially offset by lower Outside Services and Travel. • 2024 Total Operating Expenses were $49.4M higher than 2023 mainly due to higher Payroll, Equipment, Promotional Expenses, Outside Services, Property Rentals, and Legal Expenses in 2024. 26 Page 314 of 373 Port Wide 2024 Q4 Financial Performance Report Page 315 of 373 Port Wide Financial Summary • Total Operating Revenues: $17.1M over budget • Total Operating Expenses: $52.3M over budget • NOI after Depreciation: $57.9M below budget 28 Page 316 of 373 Port Wide Financial Summary Actual Budget Actual 479,697 517,683 520,600 326,592 348,212 332,713 162,991 174,245 169,758 969,281 1,040,141 1,023,071 Actual vs. Budget Variance $ % (2,917) -0.6% 15,499 4.7% 4,487 2.6% 17,070 1.7% Change from 2023 Incr (Decr) $ % 37,986 7.9% 21,620 6.6% 11,254 6.9% 70,860 7.3% DRS Pension True-up Exp Total O&M Expenses with Pension True-up 490,431 (15,638) 474,793 579,607 (28,709) 550,899 669,661 (22,790) 646,871 617,406 617,406 (52,255) 22,790 (29,465) -8.5% 0.0% -4.8% 90,054 5,919 95,972 15.5% -20.6% 17.4% Depreciation NOI After Depreciation w/o Pension True-up 233,869 85,830 256,740 132,933 272,750 97,730 250,025 155,640 (22,725) (57,910) -9.1% -37.2% 16,009 (35,203) 6.2% -26.5% NOI After Depreciation with Pension True-up 101,467 161,642 120,520 155,640 (35,120) -22.6% (41,122) -25.4% $ in 000's Aeronautical Revenues Airport Non-Aero Revenues Seaport Revenues Total Operating Revenues Total O&M Expenses w/o Pension True-up • • • 2022 2023 Actual 402,540 256,613 150,977 810,130 2024 2024 Total Operating Revenues were $17.1M over budget due to higher Airport Non-Aero Revenues, NWSA Distributable Revenue, and Cruise; partially offset by lower Conference & Event Centers. Total Operating expenses were $52.3M (excluding $22.8M pension credit) over budget mainly due to higher Payroll, Legal Expenses, and Promotional Expenses. Net Operating Income after Depreciation w/o Pension True-Up was $57.9M below budget. 29 Page 317 of 373 Port Wide Capital Spending Total capital spending was $779.2M, 0.3% below budget 30 Page 318 of 373 Aviation Division Appendix 2024 Q4 Financial Performance Report Page 319 of 373 Airport Activity 2022 2023 2024 % Change from 2023 Total Passengers (000's) Domestic International Total 41,582 4,382 45,964 45,090 5,796 50,885 46,052 6,589 52,641 2.1% 13.7% 3.4% Operations 401,351 422,497 434,321 2.8% Landed Weight (In Millions of lbs.) Cargo All other Total 2,745 26,333 29,079 2,748 29,317 32,064 2,774 30,032 32,806 1.0% 2.4% 2.3% Cargo - Metric Tons Domestic freight International & Mail freight Total 335,514 120,777 456,291 305,141 111,986 417,127 345,181 114,882 460,063 13.1% 2.6% 10.3% 2024 Passenger volume: • 2024 passenger volume increased by 3.4% compared to 2023. • Total passenger volume grew steadily, surpassing the 2019 pre-pandemic level by volume by 1.6%. 32 Page 320 of 373 Aviation Financial Summary Actual vs. Budget Variance Incr/(Decr) Change from 2023 2022 2023 2024 2024 Actual Actual Actual Budget Aeronautical Revenues Non-Aeronautical Revenues Total Operating Revenues 402,540 256,613 659,153 479,697 326,592 806,289 517,683 348,212 865,896 520,600 332,713 853,313 (2,917) 15,499 12,582 -0.6% 4.7% 1.5% 37,986 21,620 59,606 7.9% 6.6% 7.4% Total Operating Expenses w/o Pension True-Up 469,263 (23,572) 445,691 360,598 543,627 (18,577) 525,050 340,846 495,724 495,724 357,589 (47,903) 18,577 (29,325) (16,743) -9.7% DRS Pension True-Up Expense Total Operating Expenses w/ Pension True-Up Net Operating Income 394,990 (12,286) 382,704 276,449 -5.9% -4.7% 74,365 4,994 79,359 (19,753) 15.8% -21.2% 17.8% -5.5% CPE Non-Aero NOI ($ in 000s) Enplaned passengers (in 000s) 16.09 135,483 22,966 17.52 189,063 25,371 18.14 187,548 26,265 18.31 179,075 26,457 (0.17) 8,473 (192) -0.9% 4.7% -0.7% 0.62 (1,516) 893- 3.5% -0.8% 3.5% Capital Expenditures (in 000s) 311,631 444,072 683,833 682,384 (1,449) -0.2% 239,761 54.0% Financial Summary ($ in 000's) $ % $ % Operating Revenue 33 Page 321 of 373 Key Performance Measures 2022 2023 2024 2024 Actual Actual Actual Budget Actual vs. Budget Variance Incr/(Decr) Change from 2023 $ % $ % (0.17) 8,473 -0.9% 4.7% 0.62 (1,516) 3.5% -0.8% Key Performance Metrics Cost per Enplanement (CPE) Non-Aeronautical NOI (in 000's) 16.09 135,483 17.52 189,063 18.14 18.31 187,548 179,075 17.20 11.17 193 2.64 457 18.60 12.87 166 2.02 507 20.70 13.26 157 1.90 517 18.74 12.58 136 1.88 517 (1.96) 0.68 (22) 0.02 0 -10.5% 5.4% -16.1% 1.1% 0.0% 2.10 0.39 (9) (0.12) 10 11.3% 3.0% -5.3% -5.9% 2.0% 22,966 45,964 25,371 50,885 26,265 52,641 26,457 52,914 (192) (274) -0.7% -0.5% 893 1,755 3.5% 3.4% Other Performance Metrics O&M Cost per Enplanement Non-Aero Revenue per Enplanement Debt per Enplanement (in $) Debt Service Coverage Days cash on hand (17 months = 517 days) Activity (in 000's) Enplanements Total Passengers 34 Page 322 of 373 Aviation Expense Year End Summary 2022 2023 2024 2024 Actual vs. Budget Variance Actual Actual Actual Budget $ 168,389 75,700 22,880 15,141 282,110 193,130 87,364 23,285 17,655 321,434 220,728 103,263 25,543 21,440 370,975 210,530 (10,198) 126,888 23,625 23,938 (1,606) (9,402) (30,842) 351,954 (19,021) Total Exceptions (1,274) 2,356 1,081 13,017 480 13,497 2,600 553 3,153 Total Airport Expenses 283,191 334,931 374,128 352,111 (22,017) -6.3% 39,197 11.7% Maritime/Economic Development/Other 80,452 27,660 3,687 95,740 33,750 4,840 124,120 39,388 5,992 103,294 (20,826) 34,019 (5,369) 6,301 309 -20.2% 28,379 -15.8% 5,637 4.9% 1,151 29.6% 16.7% 23.8% Total Charges from Other Divisions 111,799 134,331 169,499 143,614 (25,886) -18.0% 35,168 26.2% Total Operating Expenses w/o Pension True-Up 394,990 469,263 543,627 495,724 (47,903) (12,286) (23,572) (18,577) - 18,577 382,704 445,691 525,050 495,724 (29,325) -9.7% 74,365 4,994 -5.9% 79,359 15.8% -21.2% 17.8% Total Airport Expense Summary ($ in 000's) % Incr/(Decr) Change from 2023 $ % Operating Expenses Payroll Outside Services Utilities Other Expenses Total Airport Direct Charges Environmental Remediation Liability Capital to Expense Corporate Police DRS Pension True-up Exp Total Operating Expenses w/ Pension True-Up 157 157 -4.8% 27,598 18.6% 15,899 -6.7% 2,258 328.0% 3,785 -5.4% 49,540 14.3% 18.2% 9.7% 21.4% 15.4% (2,443) -1556.1% (11,059) -85.0% (553) (172) -35.8% (2,996) -1908.5% (11,231) -83.2% 35 Page 323 of 373 Aeronautical Business 2022 2023 2024 2024 Actual vs. Budget Variance Incr/(Decr) Change from 2023 Actual Actual Actual Budget $ $ Total Rate Base Revenues 118,240 17,211 220,399 29,347 385,197 142,797 26,118 251,892 41,214 462,020 169,606 32,086 278,228 14,841 494,761 153,782 31,816 274,654 41,326 501,578 15,824 270 3,573 (26,485) (6,817) 10.3% 0.8% 1.3% -64.1% -1.4% 26,810 5,968 26,336 (26,373) 32,741 18.8% 22.8% 10.5% -64.0% 7.1% Airfield Commercial Area Subtotal before Revenue Sharing 17,343 402,541 17,677 479,697 22,922 517,683 19,022 520,600 3,900 (2,917) 20.5% -0.6% 5,245 37,986 29.7% 7.9% Total Aeronautical Revenues 402,541 479,697 517,683 520,600 (2,917) -0.6% 37,986 7.9% Total Aeronautical Expenses 261,574 308,162 364,385 342,086 (22,299) -6.5% 56,223 18.2% Aeronautical NOI 140,967 171,535 153,298 178,514 (25,216) -14.1% (18,237) -10.6% Debt Service (80,554) 60,413 (144,395) 27,140 (157,518) (4,220) (154,613) 23,902 (2,905) (28,121) 1.9% -117.7% (13,122) (31,360) 9.1% -115.5% Aeronautical NOI ($ in 000's) % % Rate Base Revenues Airfield Movement Area Airfield Apron Area Terminal Rents Federal Inspection Services (FIS) Net Cash Flow 2024 actual Net Cash Flow ($4.2M) mainly due to the lower of Federal Inspection Services (FIS) revenue requirement because of $28M construction legal claim reimbursement. 36 Page 324 of 373 Aero Cost Drivers Impact on Aero Revenues Budget vs Actual $ % 2024 Actual 2024 Budget O&M Debt Service Before Offsets Debt Service PFC Offset Net Debt Service Amortization Space Vacancy TSA Operating Grant and Other Rate Base Revenues Commercial area 353,595 226,565 (91,643) 134,922 36,935 (2,041) (28,676) 494,734 22,922 331,860 225,815 (91,493) 134,322 36,873 (719) (758) 501,578 19,022 21,735 750 (150) 600 62 (1,322) (27,918) (6,844) 3,900 6.5% 0.3% 0.2% 0.4% 0.2% 183.9% 3681.8% -1% 21% Total Aero Revenues 517,657 520,600 (2,943) -1% $ in 000's (1) (1) O&M, Debt Service Gross, and Amortization do not include commercial area costs or the international incentive expenses 2024 Actuals to 2024 Budget Rate Based Revenue $6.8M lower than budget: O&M - $21.7M higher primarily due to higher Legal Costs. Significant unbudgeted items included TSA Exit Lane Staffing and increases in Represented Payroll with retroactive contract negotiations. Additional cost increases were driven higher allocations of costs across the board including law enforcement support. These increases were partially offset by Aero share of year-end Pension Credit. Net Debt Service - $0.6M higher than budget due to very minimal changes. TSA Operating Grant and Other - $27.9M higher reflecting additional grants and $28M IAF Settlement Reimbursement. Aero rate base revenues based on cost recovery formulas 37 Page 325 of 373 Non-Aeronautical Business Year End Non-Aeronautical NOI Actual vs. Budget Variance Incr/(Decr) Change from 2023 2022 2023 2024 2024 Actual Actual Actual Budget Total Non-Aeronautical Revenues 88,899 56,473 20,804 36,581 53,856 256,613 110,990 63,460 24,878 65,952 61,312 326,592 116,626 66,271 23,946 73,703 67,666 348,212 111,036 61,599 25,333 71,332 63,413 332,713 5,590 4,672 (1,387) 2,372 4,253 15,499 5.0% 7.6% -5.5% 3.3% 6.7% 4.7% 5,637 2,810 (932) 7,751 6,354 21,620 5.1% 4.4% -3.7% 11.8% 10.4% 6.6% Total Non-Aeronautical Expenses 121,130 137,529 160,665 153,639 7,026 4.6% 23,136 16.8% 135,483 189,063 187,548 179,075 (4,338) (7,686) (10,174) (7,385) 131,145 181,377 177,373 171,689 (33,065) (27,096) (43,887) (44,482) 98,079 154,281 133,486 127,207 8,473 (2,789) 5,684 595 6,279 4.7% 37.8% 3.3% -1.3% 4.9% (1,516) (2,488) (4,004) (16,791) (20,795) -0.8% 32.4% -2.2% 62.0% -13.5% ($ in 000's) $ % $ % Non-Aeronautical Revenues Public Parking Rental Cars Ground Transportation Airport Dining & Retail Other Non-Aeronautical NOI 1 Less: CFC Surplus Adjusted Non-Aeronautical NOI Debt Service Net Cash Flow Operating Revenue was REDUCED by Federal Concessionaire Relief grants in 2022 & 2023 38 Page 326 of 373 Non-Aeronautical Revenues ($ in 000's) 2022 Actual 2023 Actual 2024 Actual 2024 Budget Incr/(Decr) 2024 Actual v. 2024 Budget $ % Non-Aeronautical Revenues Public Parking Rental Cars Ground Transportation Airport Dining & Retail Commercial Properties Non-Airline Terminal Leased Space Clubs and Lounges Utilities Other Non-Aero Revenue Total Non-Aeronautical Revenues BEFORE grants 88,899 56,473 20,804 55,719 16,747 6,954 8,688 7,943 13,932 276,159 110,990 63,460 24,878 67,870 20,370 8,294 11,710 8,666 12,272 328,511 116,626 66,271 23,946 73,703 21,744 7,909 16,709 9,578 11,725 348,212 111,036 61,599 25,333 71,332 20,496 6,756 12,024 10,089 14,048 332,713 5,590 4,672 (1,387) 2,372 1,249 1,153 4,686 (511) (2,323) 15,499- less Concession Relief grants Non-Aeronautical Operating Revenue (19,546) 256,613 (1,918) 326,592 348,212 332,713 15,499 4.7% 1,918 21,620 Total Enplanements International Enplanements O&D Enplanements 22,966 2,185 15,709 25,371 2,869 17,608 26,265 3,276 18,333 26,457 2,927 18,467 (192) 348 (134) -0.7% 11.9% -0.7% 893 406 725 Non-Aeronautical Revenue Recovery Trend by Year Incr/(Decr) 2024 Actual v. 2023 Actual $ % 5.0% 7.6% -5.5% 3.3% 6.1% 17.1% 39.0% -5.1% -16.5% 4.7% 5,637 2,810 (932) 5,833 1,375 (385) 5,000 912 (547) 19,702- 5.1% 4.4% -3.7% 8.6% 6.7% -4.6% 42.7% 10.5% -4.5% 6.0% -100.0% 6.6% 3.5% 14.2% 4.1% 39 Page 327 of 373 Non-Aero Revenue Recovery with Concessions Grant Impact 400M $348M 350M 300M $276M $269M $298M Concessionaire Relief Grants 250M Non-Aero Operating Revenue $189M 200M $138M Total 150M Non-Aero revenue per enplanement of $13.26 in 2024, has strongly exceeded the pre-pandemic peak of $10.40 in 2019 100M 50M M 2019 2020 2021 2022 2023 2024 Note: Concessionaire Relief grants applied in years 2021-2023 40 Page 328 of 373 Non-Aero Detail: Landside Revenue Trends Each individual Landside revenue segment surpassed 2019 levels in 2022, and each segment is forecasted to show continued growth in 2024. Parking continues to reflect the strongest growth. 41 Page 329 of 373 Non-Aero Detail: Public Parking Transactions *Pre-Booked launched late-2019, then transitioned to the Reserved Parking Program (Floor 4 only) in March 2024 Public Parking transaction trend driven by customer preference for close-in self-parking during pandemic recovery period. 2024 Total Parking transactions grew 2.6% above 2023 but fell -6.2% below Budget. 42 Page 330 of 373 Non-Aero Detail: ADR Revenue Trends Combined Airport Dining & Retail revenues surpassed 2019 levels in 2023, with uneven recovery patterns throughout the pandemic. In 2024, ADR in total grew 8% above 2023, despite disruptions to some individual segments from ongoing capital project work. Full recoveries from Food & Beverage, Advertising, and Retail lines of business offset slower recoveries in Duty Free and Services. 43 Page 331 of 373 Non-Aero Detail: AVBP Revenue Trends Combined Airport Business & Properties revenues surpassed 2019 levels in 2023, though with uneven recovery patterns throughout the pandemic across different segments. 2024 grew 15% above prior year with Clubs & Lounges growing 43%. Revenues from CLEAR concessions and other airport leases remained more stable throughout COVID-19, while revenues from Flight Kitchens and SEA Clubs & Lounges (Concourse A & SSAT) were more impacted and had a longer recovery arc. 44 Page 332 of 373 2024 Capital Expenditures $ in 000's SEA Gateway (1) Checked Bag Recap/Optimization (2) Budget vs. Actual 2024 2024 Actual 172,720 Budget 136,612 POF 106,366 $ 36,108 50,631 69,654 111,869 (19,023) -27.3% (2) Phase 2 Savings to Construction Contract Contingency wasn't assumed in the 2024 baseline; Phase 3 delays in Construction Start. (3) Contractor's updated schedule resulted in higher 2024 costs than forecasted. % 26.4% 34,171 17,233 15,539 16,938 98.3% (4) 18,052 7,281 4,809 10,771 147.9% MT Low Voltage Sys Upgrade (5) 36,379 25,860 26,000 10,519 40.7% C concourse Expansion (6) 75,135 85,192 109,662 (10,057) -11.8% 28,736 20,899 12,894 4,770 11,397 - (6,627) -58.1% Widen Arrivals Roadway (3) International Arrivals Fac-IAF Airline Realignment (7) ASL Replacement (8) (1) Work was completed on schedule with minor scope additions. The Program was able to tighten up the typical 60-90 day lag between completion of work and the reimbursement submittal to allow approval of one more reimbursement request than originally forecast before the end of 2024. 2024 7,837 (4) Unplanned $14M for Claims Settlement & Legal costs. It was slightly offset by $3.3M for Delayed Const work & Soft Cost Underruns. (5) Contractor resequenced work and increased crew sizes accelerating the 2024 cashflow basis to $2.8M/Mo. 37.5% (6) 2024 actual costs were lower than budget because Structural Demolition and Utility Relocation work production was slower than planned. Structural Steel erection re-sequencing is expected to mitigate some of the delay. (9) 1,793 6,596 4,775 (4,803) -72.8% Concourse A Lounge Expansion (10) All Other 39,386 43,500 47,748 (4,114) 222,060 258,160 419,857 (36,100) -14.0% Subtotal CIP Cashflow Mgmt Reserve 683,833 - 682,384 - 859,518 (141,920) 1,449 - 0.2% (8) Due to uncertainties at the start of this hot status project, high margin was included in the ROM estimate. Total Spending 683,833 682,384 717,598 1,449 0.2% (9) Project progressed slower than expected, working to accelerate and rearrange the work. Parking Garage Elevators Moder -9.5% (7) Delayed spending in previous months was realized in Q4 when the GCCM production and associated invoicing increased. (10) Const. TRA reimbursement submittals required additional review time. Due to the substantial backlog of outstanding change orders, the processing time to review the change order documentation and standard request for reimbursements has created a processing and reimbursement delay. 45 Page 333 of 373 Maritime Division Appendix 2024 Q4 Financial Performance Report Page 334 of 373 Maritime Preliminary Year-End 2024 Financials Net Operating Income is $1M unfavorable to budget and $537K higher than 2023 • Revenue is $3M better than budget and $6.8M or 8% above 2023 driven by increased grain volumes, tariff rates, and higher than expected occupancy for Cruise and Commercial Vessels. These were offset by an unbudgeted environmental credit for our T106 ground lease. • Expenses $4M or 6% over budget driven by Marine Maintenance, Police, Legal, and Capital to Expense. Expenses up $6.3M or 9% Y/Y primarily due to Payroll and Legal. • Capital spending came in at $81M or 111% of $73M budget. This was driven by spending on P66 Shorepower, T91 Berth 6&8, and Maritime Innovation Center. 2022 2023 2024 2024 Actual vs. Budget Change from 2023 Variance $ % $ % 3,0310 4% 6,753 8% $ in 000's Total Revenues Actual 71,534 Actual 82,410 Actual 89,163 Budget 86,132 Total Operating Expenses 59,557 66,637 73,409 72,589 (820) -1% 6,772 Net Operating Income 11,978 15,773 15,754 13,543 2,211 16% (19) 0% Depreciation 17,980 18,193 19,177 17,531 (1,646) -9% 984 5% Net Income (6,002) (2,420) (3,423) (3,988) Note: Totals exclude impact of pension adjustment and GASB 87 565 14% (1,003) -41% 10% 47 Page 335 of 373 Maritime 2024 Financial Summary $ in 000's Ship Canal Fishing & Operations Elliott Bay Fishing & Commercial Operations Recreational Boating Cruise Grain Maritime Portfolio Management Other Total Revenue Expenses Maritime (Excl. Maint) Economic Development Total Direct Maintenance Expenses Envir Services & Planning Seaport Finance and Cost Recovery Seaport Project Management Total Support Services IT Police Expenses External Relations Other Central Services Aviation Division / Other Total Central Services / Other Total Expense w/o Pension Adjustment Pension Adjustment Total Expense w/ Pension Adjustment NOI excluding Pension Adjustment NOI Before Depreciation Depreciation NOI After Depr. w/o Pension Adjustment 2023 Actual 2024 Actual 2024 Budget 5,076 6,564 15,505 41,726 3,356 10,263 (80) 82,410 5,169 6,602 16,555 43,145 5,920 11,762 10 89,163 4,984 5,731 16,468 41,057 5,191 12,697 4 86,132 24,423 4,855 29,278 15,424 1,289 1,072 1,654 19,439 3,375 4,803 1,663 7,751 329 17,920 70,286 (3,649) 66,637 12,124 15,773 18,300 (6,176) 23,678 5,206 28,884 16,756 1,756 1,514 2,328 22,353 3,787 5,258 2,009 10,817 302 22,172 76,394 (2,985) 73,409 12,769 15,754 19,465 (6,696) 24,640 6,326 30,966 14,983 1,718 1,653 3,117 21,471 4,128 4,929 2,158 8,633 304 20,152 72,589 0 72,589 13,543 13,543 17,531 (3,988) Actual vs. Budget Variance Change from 2023 $ % $ % 185 4% 93 2% 871 15% 39 1% 87 1% 1,050 6% 2,088 5% 1,419 3% 729 14% 2,564 43% (935) -7% 1,499 13% 6 165% 90 941% 3,031 4% 6,753 8% 963 1,120 2,082 (1,772) (37) 139 788 (882) 341 (328) 149 (2,184) 2 (2,020) (3,805) 4% 18% 7% -12% -2% 8% 25% -4% 8% -7% 7% -25% 1% -10% -5% (746) 352 (394) 1,332 467 442 674 2,915 412 455 346 3,066 (28) 4,251 6,108 -3% 7% -1% 8% 27% 29% 29% 13% 11% 9% 17% 28% -9% 19% 8% (820) (774) (2,212) (1,934) (2,707) -1% -6% -16% -11% -68% 6,772 645 (19) 1,165 (520) 9% 5% 0% 6% -8% Variance from Budget • Revenue $3M over: • Cruise - Higher Occupancy. • Grain - Higher Volumes. • Elliott Bay Fishing & Operations - unbudgeted moorage. • Maritime Portfolio Management - Environmental credit ($1.5M) related to T106 ground lease. • Operating Exp. $2M over: • Direct $898K lower - Unspent Broker Fees and Tenant Improvement at FT and SBM. • Support Services $1.4M higher - Higher wages and equipment & supplies cost than planned. • Central Services $3.6M higher - Legal expenses. 48 Page 336 of 373 Cruise 2024 Financials Variance from Budget Revenues • Higher than budget due to average occupancies exceeding 100% budget assumption (~105%) & Carnival at tariff rate through 7/1 Expenses • More than budget: • Outside Services - $298K • City of Seattle payment for P66 construction traffic mitigation • Utilities - P66 electricity $153K • Police - $313K Variance from 2023 Revenues • 2024 revenue higher due to rate escalations, even though total passengers lower than 2023 Expenses • Outside services higher in 2024 due to T91 operations evaluation consultant & P66 construction traffic mitigation payment to City 49 Page 337 of 373 $ in 000's Revenue by Facility: T-91 Fishing Related T-91 Vessel Operations Kellogg Island - Moorage Terminal 25 Docks Terminal 18 North - Dolphins Pier 34 Dolphins Other (P2, P28, P69, T46,T108) Utility Sales Revenue Total Revenue Dept Expenses: Staff Outside Services General Expenses Equipment & Supplies Utilities Support Services: Maintenance Project Management Environmental & Planning Economic Development Police/Security Other/Central Services Total Expense NOI Before Depreciation Depreciation NOI After Depreciation Elliott Bay Fishing & Commercial 2023 2024 2024 Bud Var Actual Actual Budget $ % 3,494 647 428 403 211 237 356 787 6,564 3,193 595 449 415 344 261 448 825 6,531 2,758 569 448 415 236 239 264 801 5,731 435 27 1 0 108 22 183 24 800 16% 5% 0% 0% 46% 9% 69% 3% 14% 718 14 225 18 1,238 794 20 (69) 12 1,388 806 23 113 21 1,503 12 3 182 10 114 2% 12% 161% 45% 8% 1,542 116 2,301 19 843 2,357 9,391 (2,827) 3,352 (6,180) 1,577 203 742 19 747 2,270 7,703 (1,172) 3,046 (4,218) 1,471 132 356 19 692 2,287 7,423 (1,692) 3,267 (4,959) (107) -7% (70) -53% (386) -108% 0 0% (56) -8% 17 1% (280) -4% 520 31% 221 7% 741 15% Variance from Budget Total Revenue $800K over, mostly due to: • A new license agreement with Alaska Marine Lines (AML) at T-28 and T-18 North.; • Due to current Fishing Industry pressures, some vessels stayed in port longer than expected - ASC, Arctic, for example • Total Expenses ($280K) over: • The higher expenses from Environmental ($386K) related to the ERL cleaning reserve for the Berth 6&8 project • ($107K) variance from Maintenance primarily related to P46 North Shorepower project • Bad Debt expenses (General Expenses) were $215K below the budget, primarily because more 2023 bad debt expenses were recovered in 2024, as well as the impact of the Q4 cyberattack. • Variance from 2023 Revenue: ($32K), primarily driven by: 3% - 5% rate increase in 2024 A new license agreement with AML Offset by T-91 Berth 6 & 8 project disruption; Absence of extended vessel stays for upgrades and repairs in 2024; Fewer spot moorage used in 2024 • Expenses: a ($1.7M) decrease in 2024 is primarily related to: • ($1.6M) decrease in Environmental which related to the ERL cleaning reserve for the Berth 6&8 project in 2023; • ($316K) decrease in Bad Debt expenses (General Expenses), primarily because more 2023 bad debt expenses were recovered in 2024, as well as the impact of the Q4 cyberattack; • Offset by $151K increase in Utilities • • • • • • 50 Page 338 of 373 Recreational Boating $ in 000's Revenue by Facility: Shilshole Bay Marina Harbor Island Marina Bell Harbor Marina Utility Sales Revenue Total Revenue Dept Expenses: Staff Outside Services General Expenses Equipment & Supplies Utilities Support Services: Maintenance Project Management Environmental & Planning Economic Development Police/Security Other/Central Services Total Expense NOI Before Depreciation Depreciation NOI After Depreciation 2024 Bud Var 2023 2024 Actual Actual Budget $ 13,906 547 485 566 15,505 15,049 530 460 517 16,555 14,827 516 526 599 16,468 222 1% 14 3% (66) -13% (83) -14% 87 1% 2,612 39 218 99 1,334 2,567 190 146 84 1,348 2,852 108 112 161 1,123 285 10% (82) -76% (34) -31% 78 48% (224) -20% 4,053 3,941 3,490 283 590 367 625 787 704 39 43 43 1,640 1,577 1,416 5,071 5,291 5,464 16,012 16,564 15,840 (507) (9) 628 3,313 3,170 3,181 (3,820) (3,179) (2,553) (451) (223) (83) 0 (162) 172 (724) (637) 11 (626) % -13% -61% -12% 0% -11% 3% -5% 101% 0% -25% Variance from Budget • Total Revenue $87K over: • Moorage revenue exceeded budget by $172K due to higher demand; • Offset by Utility sales below budget ($83K), primarily due to electricity. • Total Expenses ($724K) over: • ($451K) variance in Maintenance primarily at SBM • ($223K) variance in Project Management, primarily related to the assessment of Comporter Pier and repairs to the Tribal Hoist at SBM • ($224K) variance in Utility expenses • ($75K) legal reserve for SBM • Offsetting is $285K for salaries & benefits and travel expenses Variance from 2023 Actual • Total Revenue increased by approximately $1M, or 7% • Moorage rates increased 5% to 12% • Offsetting is ($53K) guest moorage primarily at BHM • Total Expenses increased by $552K, or 3% • $308K increase in Project Management, primarily related to the assessment of Comporter Pier and repairs to the Tribal Hoist at SBM • $162K in Environmental-related services, primarily through divisional allocation • $151K increase in outside service primarily related to the assessment of Comporter Pier and repairs to the Tribal Hoist at SBM • Offsetting is ($112K) in Marine Maintenance 51 Page 339 of 373 Ship Canal Fishing & Operations $ in 000's Revenue by Facility: FT Commercial FT RecBoating Salmon Bay Marina Maritime Industrial Center Utility Sales Revenue Total Revenue Dept Expenses: Staff Outside Services General Expenses Equipment & Supplies Utilities Support Services: Maintenance Project Management Environmental & Planning Economic Development Police/Security Other/Central Services Total Expense NOI Before Depreciation Depreciation NOI After Depreciation 2024 Bud Var 2023 2024 Actual Actual Budget $ % 2,900 772 1,046 160 198 5,076 2,904 852 1,080 123 209 5,169 2,807 787 1,071 143 176 4,984 97 66 10 (20) 33 185 3% 8% 1% -14% 19% 4% 1,315 48 194 54 985 1,619 34 (52) 73 940 1,678 20 30 90 1,014 59 4% (15) -75% 81 274% 16 18% 74 7% 2,302 2,384 2,312 456 536 775 634 582 387 17 18 18 709 635 574 2,134 2,059 2,407 8,847 8,831 9,305 (3,771) (3,662) (4,321) 2,380 2,189 2,319 (6,152) (5,851) (6,641) (72) 239 (195) 0 (62) 348 474 659 130 789 -3% 31% -50% 0% -11% 14% 5% 15% 6% 12% Variance from Budget • Total Revenue $185K or 4% over, attributed to: • $70K increase in moorage revenue from monthly moorage; • $64K increase in locker revenue due to the use of Net sheds 7&8; • Total Expenses are $ 474K under, primarily due to: • $ 239K under budget in Project Management. • Bad Debt expenses are $236K below budget, primarily because more 2023 bad debt expenses were recovered or written off in 2024, as well as the impact of the Q4 cyberattack. Variance from 2023 • Total revenue increased $93K from 2023, mainly due to: • $172K or 5% increase in Moorage revenue, attributed to rate increases from 2023 • $91K increase in locker revenue due to the use of Net sheds 7 & 8; • Offset by reimbursement revenue of ($184K) from the Derelict Vessel program in 2023. • Total expenses decreased by ($16K), primarily due to: • Bad Debt expenses ($361K) decreased primarily because more 2023 bad debt expenses were recovered and written off in 2024, as well as the impact of the Q4 cyberattack. • Offset by a $304K increase in staff-related expenses, partially due to a vacant position in 2023. 52 Page 340 of 373 All Portfolio Management Occupancy Total Available SF Building CEC Central Harbor Marina Office & Retail Maritime Industrial T91 Upland Total 901,982 Total Available SF 3,505,093 Land Central Harbor Marina Office & Retail Maritime Industrial T91 Upland Total SF Occupied SF Vacant % Occupied 69,915 100% 214,381 78,782 78% 164,951 38,090 81% 271,370 100% 64,493 100% 785,110 116,872 SF Occupied SF Vacant % Occupied 1,399,633 95,353 94% 152,001 204,297 43% 1,244,194 100% 389,615 20,000 95% 3,185,443 319,650 53 Page 341 of 373 Maritime Portfolio Management $ in 000s Revenue by Facility: 2023 2024 2024 Actual Actual Budget Terminal 91 Terminal 106 FT Office & Retail MIC Uplands Salmon Bay Marina Uplands SBM Office & Retail Other (T108, T115) 3,701 360 2,083 785 75 581 189 4,301 1,288 2,087 787 83 571 200 3,990 2,515 1,925 804 84 576 134 311 (1,227) 162 (16) (1) (4) 66 8% -49% 8% -2% -1% -1% 50% Utilities Total Revenue 2,488 10,263 2,445 11,762 2,669 12,697 (225) (935) -8% -7% Dept Expenses: Staff Outside Services General Expenses Equipment & Supplies Utilities 614 94 (123) 0 2,669 678 19 208 2 2,677 592 514 142 3 3,085 (86) 496 (66) 1 408 -15% 96% -46% 46% 13% Support Services: Maintenance Environmental Project Management Group Planning Police/Security 3,743 1,389 561 283 1,379 4,316 519 551 316 1,329 3,880 559 936 428 1,122 (436) 40 384 112 (207) -11% 7% 41% 26% -18% Variance from 2023 Other/Central Services Total Expense 5,061 15,671 4,771 15,385 4,246 15,507 (524) 122 -12% 1% NOI Before Depreciation Depreciation NOI After Depreciation (5,408) 2,540 (7,948) (3,623) 2,708 (6,331) (2,810) 2,409 (5,218) (813) (299) (1,112) -29% -12% -21% Expenses $286K decrease • Environmental exp ($870K) lower due to 2023 $964K ERL for FT MInC • Partially offset: - MM exp $573K higher mainly due to higher Wages & Benefits at FT, T91 & T106. - General Expenses, $331K higher mainly due to 2023 resolved bad debt and miscoded PMG project costs Bud Var $ % Overall Occupancy • Marina Office & Retail: Buildings 81%, Land 43% • Maritime Industrial: Buildings 100% and Land 95% Variance from Budget Revenues $935K Lower • Unbudgeted environmental cost credit to Trammell Crow at T106 ($1.5M in 2024). • Offset by higher revenue from Lineage Logistics (market rates reset) and from unexpectedly renewed expiring leases in 2024. Expenses $122K Lower • Outside Services $496K lower: unspent TI and broker's fees mainly at FT and SBM. • Project Management $384K lower: unspent Outside Services at FT, SBM and T91. • Partially offset: - MM expenses ($436K) higher in Wages & Benefits and Supplies & Stock (mainly at FT). - MD Other ($203K) higher due to unbudgeted SaBM's Operations employees charged to FT Office & Retail. Revenue $1.5M Increase • Trammell Crow's full-rate revenue started in April 2024. • Lineage Logistic market rates reset. 54 Page 342 of 373 Marine Maintenance $ in 000's Reimburseable Revenue EDD MD JV Total Revenue Labor Staff Equipment & Supplies Outside Services Utilities General Expenses Other Expenses SWU Facilities BOST Fleet Admin Total Expense NOI Before Depreciation Depreciation NOI after Depreciation 2023 Actual 2024 Actual 2024 Budget 235 170 678 1,083 189 204 527 921 175 157 632 965 15,068 4,060 815 478 57 322 2,551 1,978 1,829 2,184 363 29,705 (28,622) 1,315 (29,937) 16,765 2,747 443 338 (133) (74) 2,824 2,358 2,115 2,952 362 30,696 (29,775) 1,372 (31,148) 15,925 2,339 512 225 9 (9) 2,936 1,891 2,172 3,592 1,196 30,789 (29,825) 1,194 (31,019) Bud Var $ % (14) (47) 105 44 8% 30% -17% -5% (839) 5% (407) 17% 69 -14% (113) 50% 142 -1652% 65 751% 113 -4% (467) 25% 57 -3% 641 -18% 834 -70% 93 0% (49) 0% (178) 15% 129 0% Variance from Budget: Total Reimbursable Revenue under budget by $44K, mostly due to: • T18 (Joint Venture) under budget $109K. Offset by overages in Maritime and EDD facilities budgeted for an anticipated slow down which did not occur in 2024. Total Expenses on Target • Labor Staffing was ($706K) overbudget due to Comp Project/Retro Pay. This was offset by savings in Materials, Fuel due to state pricing and savings from software implementation. • Equipment and Supplies was ($407K) overbudget in 2024. This is underbudget compared to 2023 spend. Variance from 2023: Revenue: • Anticipated more of a decrease in 2024. Expenses: • Cyber Outage impacted services performed and contracted services needed. 55 Page 343 of 373 Maritime Management Admin Major Variances: Operating Expense: $239K under • Salaries & Benefits: $187K under due to Unfilled Chief Development Officer position. • Outside Services: ($16K) over Architectural & Engineering Services provided by OTAK Project Controls Consultant to support business unit expenses were to be charged to Org 6260, WPMG. • Promotional Expenses: $23K unspent budget for Customer Holiday party, lunch and dinners. 56 Page 344 of 373 Maritime Planning Major Variances: Operating expense $414K under spent • Outside Services: $533K Underspent in Personal services due to capacity and time to build-out Strategic Planning/Policy program, 700K. • Salaries & Benefits: ($168K) Over budget due to Planner Emergency Hire • Travel & Other Employee Expenses: $13K Underspent budget for (4) American Institute of Certified Planner memberships, 3K. Lodging, Airfare & Registration for American Planning Association and WPPA conferences, 10K. 57 Page 345 of 373 Business Highlights for 2024 Maritime Environment & Sustainability • Secured $3M EPA Clean Ports Planning Grant to support decarbonization planning efforts through 2027 • Completed the Seattle Waterfront Clean Energy Strategy, a roadmap for power infrastructure to support electrification on Port properties in the Seattle harbor • Completed the Scope 3 Puget Sound Air Emissions Inventory for the year 2021 and supplemental cruise inventory for 2022 • Worked closely with CM and WPM to substantially complete Terminal 5 Berth Modernization and Pier 66 Shorepower projects • Completed $48m sale of mitigation credits to Lockheed Martin Company • AdaptSea charter signed along with various agencies to commit to working together on waterfront resiliency • Duwamish Sea Level Rise MOU signed by the Port, City, and King County • NOAA/US Fish & Wildlife Service approval of new port-specific mitigation calculator for endangered species • Completed third year of Urban Kelp Study with Seattle Aquarium • Trustee approval of T25 habitat restoration design and scope of work • Completed Centennial Park shoreline erosion study which identifies future restoration opportunities • Procured, customized, and rolled-out new Permit Compliance Tracking System 58 Page 346 of 373 Maritime Environment & Sustainability Salaries & Benefits: (454K) unfavorable for due to filling vacant positions higher than budgeted and more charges to Overhead than budgeted. Wages & Benefits: 359K favorable due to DRS Pension True-up. Payroll to Cap/Govt/Envrs: (57K) unfavorable charging more to Cap/ERL 7% higher than budgeted. Charges to Cap/ERL: 235K favorable to due to increased direct charge Outside Services: 33K 2% favorable. Lower Staff costs to Capital and ERL than planned and delays in payments of invoices for Outside Services 59 Page 347 of 373 Business Highlights Marine SWU for 2024 Marine Stormwater Utility (SWU) • Completed SWU rate review and commission approval for an 8% rate increase. Communicated increase to tenants and Northwest Seaport Alliance in December and updated external website. Rates remain lower than Seattle Public Utilities stormwater rates. • In process of updating the SWU Strategic Plan (2026-2030). This will replace the 2021-2025 Strategic Plan and includes input from stakeholders including the Northwest Seaport Alliance, Port departments, and tenants to assist with future goals and strategics. • Completed stormwater asset repair and rehabilitation projects at Terminals 18 and 46, Maritime Industrial Center, Shilshole Bay Marina, and Fishermen's Terminal. • Met with and submitted comments to Washington Department of Ecology on the new industrial stormwater general permit. Changes in the final permit were beneficial to some Port facilities and operations. • Renewed the Park's Salmon-Safe certification for another 5 years following an August 2024 site visit by Salmon-Safe technical team. The program will be managed by Marine Maintenance for the next cycle in collaboration with ME&S habitat, stormwater, and permitting teams. 60 Page 348 of 373 Maritime Capital 2024 Actual $ in 000's P66 Shore Power T91 Berth 6 & 8 Redev FT Maritime Innovation Center P66 Fender Replacement MIC Electrical Replacements T91 New Cruise Gangway Sustainable Eval Framework Res HIM Dock-E Improvements MD Small Projects MD Fleet All Other Projects Subtotal CIP Cashflow Mgt - MD Total Maritime % of Capital Budget 2024 2024 POF Budget vs Forecast Budget $ % 23,874 25,085 27,752 (1,211) -5% 22,682 21,931 19,223 751 3% 9,227 7,384 14,789 1,843 25% 3,730 2,800 2,382 930 33% 1,931 2,203 411 (272) -12% 2,342 2,090 3,040 252 12% 0 2,000 2,000 (2,000) -100% 3,050 1,920 2,350 1,130 59% 1,358 2,340 2,234 (982) -42% 3,399 4,038 4,503 (639) -16% 9,469 15,449 30,341 (5,980) -39% 81,062 87,240 109,025 (6,178) -7% 0 (14,264) (24,200) 14,264 -100.0% 81,062 72,976 84,825 8,086 11% 111% 100% Projects with Significant Variances FT Innovation Center - Additional workflow analysis through Forma resulted in the preorder of equipment that was originally planned to be purchased later. HIM Dock-E Improvements - The contractor performing the dock fabrication finished sooner than originally projected. All Other Projects - MD Video Camera Project ($1.3M) delayed due to cyber incident. 61 Page 349 of 373 Economic Development Division Appendix 2024 Q4 Financial Performance Report Page 350 of 373 EDD 2024 Financials 2022 2023 2024 2024 $ 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 Diversity in Contracting Tourism EDD Grants Total EDD Initiatives Environmental & Sustainability Police Expenses Other Central Services Aviation Division Total Central Services & Aviation Actual 8,886 8,914 17,799 Actual 10,477 6,738 17,215 Actual 10,016 7,490 17,506 Budget 10,386 11,156 21,542 Actual vs. Budget Variance $ % (370) -4% (3,666) -33% (4,036) -19% 3,653 6,563 230 299 1,058 3,836 1,223 16,863 186 1,737 105 2,028 30 240 4,893 146 5,309 3,713 6,632 254 340 1,734 3,498 1,501 17,672 268 1,540 1,491 3,300 53 288 5,207 141 5,689 3,954 7,150 237 235 1,488 3,532 1,571 18,168 253 1,738 964 2,955 72 333 6,099 130 6,635 3,917 9,602 225 249 1,058 4,024 1,894 20,971 250 1,875 1,505 3,630 108 289 5,539 132 6,068 (37) 2,452 (12) 14 (430) 492 323 2,803 (3) 137 541 675 36 (44) (560) 2 (567) Total Expense before Pension Adjustment Pension Adjustment Total Expense with Pension Adjustment NOI Before Depreciation Depreciation 24,200 (629) 23,571 (5,772) 3,954 26,661 (1,168) 25,494 (8,279) 4,132 27,758 (981) 26,777 (9,271) 4,373 30,669 0 30,669 (9,127) 4,028 NOI After Depreciation (9,725) (12,411) (13,644) (13,154) Change from 2023 $ (461) 752 291 % -4% 11% 2% -1% 26% -5% 6% -41% 12% 17% 13% -1% 7% 36% 19% 33% -15% -10% 1% -9% 242 518 (17) (105) (247) 34 70 496 (15) 197 (527) (345) 19 45 892 (11) 945 7% 8% -7% -31% -14% 1% 5% 3% -6% 13% -35% -10% 36% 16% 17% -8% 17% 2,911 981 3,892 (144) (346) 9% NA 13% -2% -9% 1,096 187 1,283 (992) 241 4% 16% 5% -12% 6% (490) -4% (1,233) -10% Variance from Budget Revenue $4M unfavorable to budget • Conf. & Event Center activity less than budgeted • Lower event activity led to lower garage utilization • WTC West business lost to competitors that provide finished, ready-to-use office space Expenses $2.9M below budget • Conf. and Event Centers volumes drove reduced variable expenses • Unspent Outside Services expenses • EDD Grants lower from shift to 1-yr Cycle and some miscoded expense were to be charged to the Tax Levy cost center • Pier 69 Facilities underspent in Equipment expenses and Salaries & Benefits • Small Business underspent in Outside Services • Tourism underspent on Outside Services 63 Page 351 of 373 Small Business Development - Diversity in Contracting Major Variances: Operating Expense: 482K underspent • Outside Services: 174K underspent budget in Non-Architectural & Engineering services for Tabor100 Resource center, Mentor Protégé (ACE & AGC) paused, Community Development Fund Training. • Salaries & Benefits: 101K variance due to unfilled DIC Coordinator position. • Promotional Expenses: 73K variance due to decrease in Trade Business and Community expenses. Government and Community partnership events did not occur. • Travel & Other Employee Expenses: 20K underspent in Travel related Lodging, Meals and Memberships due to Director foregoing planned travel/training to allow staff development opportunities. 64 Page 352 of 373 Tourism Major Variances: Operating Expense: 174K underspent CA Goal Advance this Region as a Leading Tourism Destination and Business Gateway EDD Tourism Department • Outside Services: 121K variance due to decrease in Tourism contracts and Marketing support contracts caused by adjustments in grant cycle from two year to one year to align with partner's budget cycles. • Travel & Other Employee Expenses: 21K variance due to decrease in Registration, Travel related meals, transportation and lodging. • Equipment Expenses: 12K budget for new Simpleview software was expensed in Outside services. • General Expenses: (18K) variance due to increase in Advertising expenses. Tourism Marketing Initiatives Promote Air Travel and Cruise/Stay Tourism grant programs Key Metrics Passenger enplanement increases $ value of promotions, etc. 65 Page 353 of 373 P69 Facilities Major Variances: Operating Expense: 239K underspent • Salaries & Benefits: 72K variance due to vacant Corporate Facility Manager and Facility Supervisor positions. • Outside Services: 22K Budget allowance for architectural & engineering services 10K and Office Space Facility Management Software 11K unspent. • Equipment Expenses: 93K Allowance for miscellaneous furniture and equipment as needed, unspent. • Supplies and Stock: 13K variance due to Cyber Attack, network unavailable which caused a decrease in employees utilizing the facility. This resulted in a decrease of consumables used and replaced. 66 Page 354 of 373 EDD Admin Major Variances: Operating Expense: 576K underspent • Salaries & Benefits: 291K variance due to vacant Managing Director and Innovation Program Manager positions. • General Expenses: 150K unspent budget for EDD Opportunity Fund. • Travel & Other Employee Expenses: 58K unspent budget was for previous Director's Travel and Memberships. 67 Page 355 of 373 Real Estate Development $ in 000's 2023 2024 2024 Actual Actual Budget Bud Var $ % Salaries & Benefits Equipment Expense Supplies and Stock Outside Services Travel & Other Employee Exp Promotional Expenses General Expenses All Other Expenses 515 3 0 397 1 0 0 (48) 574 2 0 475 1 0 1 (38) 714 2 1 364 14 0 0 5 140 20% 0 11% 1 1 (111) -30% 13 92% 0 NA (0) -198% 43 890% Total Operating Expense 869 1015 1100 85 8% Pension Adjustment (51) (42) Total Expense w/out Pension Adjustment 920 1057 1100 43 4% Variance from Budget Expenses $43K lower • Salary & Benefits $140K lower due to unfilled FTE Real Estate Planning Specialist position • Unspent travel funds, $13K • Partially offset by Outside Services ($111K) higher due to higher AV Non-Aero expenses for feasibility, design and due diligence efforts for various properties. 68 Page 356 of 373 EDD Portfolio Management $ in 000s 2023 2024 2024 Revenue by Facility: Conference Centers WTC - Seattle WTC West - Building P66 Retail Bell Street Garage T102 Uplands T91 Uplands Other (P2, P69, T34, Tsubota, T5SE, FTZ) Utilities Total Revenue Actual 5,537 1,104 1,731 379 1,910 2,499 1,789 1,931 360 17,238 Actual 6,478 932 1,436 387 1,894 2,354 1,833 1,829 356 17,498 Budget 9,674 1,375 1,705 436 2,457 2,139 1,468 1,910 375 21,539 Bud Var $ (3,196) (444) (269) (49) (564) 215 365 (81) (19) (4,042) % -33% -32% -16% -11% -23% 10% 25% -4% -5% -19% Dept Expenses: Staff Outside Services General Expenses Equipment & Supplies Utilities 1,190 393 7,668 18 1,714 1,430 681 8,108 39 1,618 1,590 435 10,407 332 1,735 160 (246) 2,299 293 117 10% -57% 22% 88% 7% Support Services: Maintenance Environmental PMG Planning Police and Security Other/Central Services 3,478 214 489 0 617 7,469 3,509 282 437 7 651 8,049 4,018 282 592 0 758 7,434 0 509 (1) 156 (7) 107 (615) NA 13% 0% 26% NA 14% -8% Total Expense 23,250 24,811 27,582 2,771 10% NOI Before Depreciation (6,012) (7,313) (6,043) (1,270) -21% Depreciation NOI After Depreciation 4,121 4,343 4,017 (10,133) (11,656) (10,060) (326) (1,596) -8% -16% Overall Occupancy • Central Harbor: Building 78%, Land 94% • T91 Uplands: Building 100%, Land 95% Variance from Budget Revenues $4M Lower • Conf. & Event Centers & WTCS - overly optimistic budgeting & competition. • WTCW - lost business-competitors providing finished, ready-to-use office space. • Bell St. Garage - lower garage utilization, P66 total cruise calls set too high. • Partially offset by revenue from tenants renewing leases in 2024 at T102 & T91 Uplands. Expenses $2.8M Lower • Conf. and Event Centers volumes drove reduced variable expenses. • Lower MM exp mainly due to lower in Salary, Wages & Benefits and in Supplies & Stock. • Project Management: unspent Outside Services at mainly T102 and P66. • Partially offset by higher Outside Services from unbudgeted TI, additional janitorial services, and some expenses were budgeted under different GL#. • Partially offset by higher Central Services allocation in legal fees. Variance from 2023 Revenue $260K Increase • Conf. and Event Centers - fewer event cancellations. • Partially offset by discontinued leases at T102, WTCW and reduced tenant sf at P2. Expense $1.7M Increase • General expense - higher due to Conf. & Event Centers volumes increased variable expenses. • Outside Services - higher broker fees at T34, WTCW, T102 & additional janitorial services. • Central Services allocation - higher in legal fees. 69 Page 357 of 373 Maritime Portfolio Occupancy Marina Office and Retail Maritime Industrial Overall Occupancy Overall Occupancy Building 81% Land 43% Building 100% Land 100% Land Occupancy 70 Page 358 of 373 All Portfolio Management Market Statistics * Information source: Costar-Office & Industrial Market Averages (does not capture land only leases) 71 Page 359 of 373 EDD Capital 2024 Actual $ in 000's T91 Uplands Dev Phase I P69 Underdock Utility Rplc P69 Public Video Wall WTCW Roof Replacement P69 Computer Room CRAC Repl T91 Ped Path and Bike Bridge EDD Tenant Improvements EDD Technology Projects CW Bridge Elev Modernizations P69 3rd Floor Terrace Repair All Other Projects Subtotal CIP Cashflow Mgmt Reserve Total Economic Development % of Capital Budget 1,357 854 105 229 81 180 0 0 117 0 857 3,780 0 3,780 74% 2024 Budget 2,650 1,050 575 461 386 346 300 250 220 130 579 6,947 (1,810) 5,137 100% 2024 POF Budget vs Forecast 18,409 600 725 83 529 1,350 300 250 0 775 6,204 29,225 (8,724) 20,501 $ (1,293) (196) (470) (232) (305) (166) (300) (250) (103) (130) 278 (3,167) 1,810 (1,357) % -49% -19% -82% -50% -79% -48% -100% -100% -47% -100% 48% -46% -100% -26% T91 Uplands - Procurement delay due to change in methodology. Moved from Design-Build to Progressive Design Build (protracts the design process). P69 Public Video Wall - Cost reduction using Port Engineering and PCS for construction vs. using outside contractor. P69 Computer Room CRAC - Procurement delay due to cyber disruption. 72 Page 360 of 373 Central Services Appendix 2024 Q4 Financial Performance Report Page 361 of 373 Central Services Business Events  Commission presented the Port's activities and future plan at the State of the Port hosted by West Seattle Chamber State  Executive Director presented on decarbonization during the Ports Authority Roundtable  Commission authorized $14M the second iteration of the South King County Community Impact Fund (SKCCIF) program over the next five years  Received the American Association of Port Authorities Lighthouse Award of Excellence in Economic Development Practices for the South King County Community Impact Fund  Hosted a hybrid format town hall with more than 500 online participants and approximately 70 inperson attendees  Celebrated the Muckleshoot Tribe's Tomanamus Community Day at the Muckleshoot Job Fair & Community Gathering  Participated in over 83 outreach events focused on local Port communities to promote jobs at the Port. The Port hired 58 high school interns and 54 post-secondary interns in 2024  Conducted the Data and Equity Workshop Series in partnership with We All Count with the goal to advance equity into data collection and analysis 74 Page 362 of 373 2024 Operating Expenses Summary      Payroll Expenses $9.7M above budget Promotional Expenses $4.6M above budget Outside Services $2.4M below budget Travel & Other Employee Expenses $925K below budget Charges to Capital Projects $2.2M below budget 75 Page 363 of 373 Central Services Financial Highlights Budget 163 120,940 40,538 19,488 180,967 - Actual vs. Budget Variance $ % 240 146.8% (31,078) -25.7% (6,153) -15.2% 2,154 11.1% (35,077) -19.4% 11,743 0.0% Change from 2023 Incr (Decr) $ % 619 -286.6% 40,650 36.5% 5,668 13.8% 3,093 21.7% 49,412 29.7% 2,736 -18.9% 180,967 (23,334) 52,148 2022 2023 2024 2024 $ in 000's Total Operating Revenues Core Central Support Services Police Engineering/PCS Total O&M Expenses w/o Pension True-up DRS Pension True-up Exp Actual 2,538 96,695 33,487 10,593 140,775 (6,666) Actual (216) 111,368 41,023 14,241 166,632 (14,479) Actual 403 152,018 46,691 17,334 216,044 (11,743) Total O&M Expenses with Pension True-up 134,110 152,153 204,300   -12.9% 34.3% 2024 Total Operating Revenues were 240K above budget due to forfeitures and Reimbursable Revenue from Police. 2024 Total Operating Expenses (without the non-cash expense credit related to the Port's public pension plans) were $35.1M unfavorable to budget mainly due to higher Payroll, Equipment Expense, Supplies & Stock, Insurance Expense, Promotional Expenses ($2.5M payment to Seattle Aquarium and $2.0M payment to Friends of the Waterfront), and Legal Expenses; partially offset by lower Outside Services and Travel. 76 Page 364 of 373 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 Expenses Insurance Expense Litigated Injuries & Damages Other Expenses Charges to Capital Projects/Overhead Alloc TOTAL w/o DRS Pension True-up DRS Pension True-up Credit TOTAL w/ DRS Pension True-up • • • Actual vs. Budget Variance $ % (5,009) -4.9% (4,702) -12.8% 4,906 19.4% (337) -12.5% (111) -11.1% 2,401 5.2% 925 25.1% (513) -9.3% (25,882) 0.0% (4,524) -100.7% (2,232) 4.8% (35,077) -19.4% Change from 2023 Incr (Decr) $ % 14,994 16.2% 5,463 15.2% 555 2.8% 625 26.1% (443) -28.6% 4,001 10.2% 176 6.8% 1,326 28.1% 22,976 790.5% 4,917 119.9% (5,178) 13.2% 49,412 29.7% 2022 2023 2024 2024 Actual 78,779 29,719 16,628 2,561 992 30,694 1,950 4,115 3,354 2,777 (30,793) 140,775 Actual 92,338 35,832 19,886 2,400 1,551 39,407 2,589 4,715 2,907 4,102 (39,094) 166,632 Actual 107,333 41,294 20,441 3,025 1,107 43,408 2,766 6,041 25,882 9,019 (44,272) 216,044 Budget 102,324 36,592 25,348 2,688 997 45,810 3,691 5,527 4,494 (46,504) 180,967 (6,666) (14,479) (11,743) - 11,743 0.0% 2,736 -18.9% 134,110 152,153 204,300 180,967 (23,334) -12.9% 52,148 34.3% Payroll above budget to mainly due to Compensation Project Outside Services below budget due to spending delays Other Expenses above budget mainly due to the $2.5M earlier payment to Seattle Aquarium than budgeted and unbudgeted $2.0M payment to Friends of the Waterfront 77 Page 365 of 373 Central Services Capital Spending 2024 $ in 000's Engineering Fleet Replacement Corporate Fleet Replacement Services Tech - Small Cap Infrastructure - Small Cap Enterprise Network Refresh ID Badge System Upgrade Radio Microwave Redundancy Loop Public Safety Dispatch & Police RMS Enterprise Firewall Refresh Physical Access Control System Refresh Office Wi-Fi Refresh Other (note 1) Subtotal CIP Cashflow Adjustment TOTAL Actual 643 269 1,155 799 1,741 1,068 305 567 483 10 643 1,771 9,454 9,454 2024 2024 Plan of Budget Finance 3,716 1,890 1,189 920 1,623 1,500 1,500 1,500 2,600 2,600 2,551 2,550 2,272 1,973 950 1,720 1,550 1,460 1,250 1,100 1,565 1,000 5,052 5,916 25,818 24,129 (6,800) (6,200) 19,018 17,929 Budget Variance $ % (3,073) -82.7% (920) -77.4% (468) -28.8% (701) -46.7% (859) -33.0% (1,483) -58.1% (1,967) -86.6% (383) -40.3% (1,067) -68.8% (1,240) -99.2% (922) -58.9% (3,281) -64.9% (16,364) -63.4% 6,800 -100.0% (9,564) -50.3% Note: (1) "Other" includes remaining ICT projects and small capital projects/acquisitions. 78 Page 366 of 373 Portwide Appendix 2024 Q4 Financial Performance Report Page 367 of 373 Seaport Financial Summary • Change from 2023 Incr (Decr) $ % 4,714 8.2% 6,753 8.2% 291 1.7% (504) -8.9% 11,254 6.9% 2023 2024 2024 Actual 55,353 71,534 17,799 6,291 150,977 Actual 57,685 82,410 17,215 5,681 162,991 Actual 62,399 89,163 17,506 5,177 174,245 Budget 57,154 86,132 21,542 4,929 169,758 DRS Pension True-up Exp Total O&M Expenses with Pe nsion True-up 95,481 (3,351) 92,129 110,345 (5,137) 105,208 126,034 (4,212) 121,821 121,682 121,682 (4,352) 4,212 (140) -3.6% 0.0% -0.1% 15,689 925 16,614 14.2% -18.0% 15.8% Depreciation NOI After Depreciation w/o Pension True-up 39,524 15,973 42,141 10,506 39,625 8,586 37,020 11,056 (2,605) (2,470) -7.0% -22.3% (2,516) (1,920) -6.0% -18.3% NOI After Depreciation with Pension True-up 19,324 15,643 12,798 11,056 1,742 15.8% (2,844) -18.2% $ in 000's NWSA Distributable Revenue Maritime Revenues EDD Revenues SWU & Other Total Operating Revenues Total O&M Expenses w/o Pension True-up • Actual vs. Budget Variance $ % 5,244 9.2% 3,031 3.5% (4,036) -18.7% 248 5.0% 4,487 2.6% 2022 Non-Airport Operating Revenue: $4.5M over budget due to higher revenues from NWSA Distributable Revenues, Cruise, and Fishing & Operations; offset by lower revenues from Maritime Portfolio Management and Conference & Event Center. Operating Expenses: $4.4M over budget due to Payroll, Supplies & Stock, Utilities, and less charges to Capital. 80 Page 368 of 373 Port Wide Operating Revenues Summary Budget 520,600 Actual vs. Budget Variance $ % (2,917) -0.6% Change from 2023 Incr (Decr) $ % 37,986 7.9% 116,626 45,399 20,872 81,612 23,946 10,462 21,744 9,578 16,709 43,145 16,555 11,771 5,920 11,762 9,993 7,490 62,399 6,474 522,457 111,036 42,201 19,399 78,088 25,333 11,656 20,496 10,089 12,024 41,057 16,468 10,715 5,191 12,697 10,363 11,156 57,154 7,348 502,471 5,590 3,198 1,473 3,524 (1,387) (1,195) 1,249 (511) 4,686 2,088 87 1,056 729 (935) (370) (3,666) 5,244 (874) 19,986 5.0% 7.6% 7.6% 4.5% -5.5% -10.3% 6.1% -5.1% 39.0% 5.1% 0.5% 9.9% 14.0% -7.4% -3.6% -32.9% 9.2% -11.9% 4.0% 5,637 (1,107) 3,917 7,366 (932) (112) 1,375 912 5,000 1,419 1,050 131 2,564 1,499 (472) 752 4,714 (837) 32,874 5.1% -2.4% 23.1% 9.9% -3.7% -1.1% 6.7% 10.5% 42.7% 3.4% 6.8% 1.1% 76.4% 14.6% -4.5% 11.2% 8.2% -11.4% 6.7% 1,040,141 1,023,071 17,070 1.7% 70,860 7.3% 2022 2023 2024 2024 $ in 000's Aeronautical Revenues Actual 402,540 Actual 479,697 Actual 517,683 Public Parking Rental Cars - Operations Rental Cars - Operating CFC 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) 88,899 44,302 12,171 43,126 20,804 10,645 16,747 7,943 8,688 30,469 13,978 10,566 5,792 10,550 8,791 8,914 55,353 9,851 407,590 110,990 46,506 16,954 74,246 24,878 10,574 20,370 8,666 11,710 41,726 15,505 11,640 3,356 10,263 10,465 6,738 57,685 7,311 489,584 TOTAL 810,130 969,281 81 Page 369 of 373 Port Wide Operating Expense Summary • • • • • Actual vs. Budget Variance $ % (6,092) -2.9% (19,984) -11.6% 12,754 27.8% 26,942 14.4% (1,182) -3.6% (152) -1.3% (3,693) -39.8% 2,026 25.0% 1,611 11.1% (516) -7.7% (38,924) -198.6% (25,045) 24.4% (52,255) -8.5% Change from 2023 Incr (Decr) $ % 31,117 16.6% 23,808 14.2% 599 1.8% 21,408 15.4% 2,560 8.2% (834) -6.6% 27 0.2% 557 10.1% 2,030 18.6% 785 12.2% 18,703 47.0% (10,707) 16.0% 90,054 15.5% 2022 2023 2024 2024 $ in 000's Salaries & Benefits Wages & Benefits Payroll to Capital Projects Outside Services Utilities Equipment Expense Supplies & Stock Travel & Other Employee Expenses Third Party Mgmt Op Exp B&O Taxes Other Expenses Charges to Capital Projects/Overhead Alloc TOTAL w/o DRS Pension True-up Actual 159,305 146,887 27,020 116,405 31,202 12,039 11,549 4,400 8,985 5,406 21,353 (54,120) 490,431 Actual 187,197 167,928 32,448 139,389 31,226 12,624 12,956 5,511 10,930 6,431 39,824 (66,857) 579,607 Actual 218,314 191,736 33,047 160,797 33,786 11,790 12,983 6,068 12,960 7,216 58,527 (77,564) 669,661 Budget 212,222 171,752 45,801 187,740 32,604 11,637 9,290 8,095 14,570 6,700 19,603 (102,609) 617,406 DRS Pension True-up Credit (15,638) (28,709) (22,790) - 22,790 0.0% 5,919 -20.6% TOTAL w/ DRS Pension True-up 474,793 550,899 646,871 617,406 (29,465) -4.8% 95,972 17.4% Payroll was $26.1M over budget due to Compensation Project, retro pay for represented groups, and less charges to Capital. Outside Services were $26.9M below budget due to project delays, cyber-attack disruption, and implementation of SBITA. Supplies & Stock were $3.7M over budget due to maintenance supplies. Travel & Other Employee Expenses were $2.0M below budget due to delays in training and travel from cyber-attack disruption. Charges to Capital Projects were $25.0M below budget due to delays in Capital Projects. 82 Page 370 of 373 Port Wide Capital Spending Summary $ in 000's 2024 2024 2024 Actual Budget Plan of Finance Budget Variance $ % Aviation 683,833 682,384 717,598 1,449 0.2% Maritime 81,062 72,976 84,825 8,086 11.1% Economic Development 3,780 5,137 20,501 (1,357) -26.4% Central Services & Other (note 1) 10,511 20,716 19,742 (10,205) -49.3% TOTAL 779,186 781,213 842,666 (2,027) -0.3% Note: (1) "Other" includes 100% Port legacy projects in the North Harbor and Storm Water Utility Small Capital projects. 83 Page 371 of 373 Community Programs 84 Page 372 of 373 Community Programs Fav (UnFav) Incr (Decr) Actual vs. Budget Change from 2023 Variance $ % $ % Program ($ in $000) 2022 Actual 2023 Actual 2024 Actual 2024 Budget 1) Energy & Sustainability Fund 2) Airport Community Ecology (ACE) Fund 1 3) South King County Community Impact Fund (SKCCIF) 4) Duwamish Valley Community Equity Program (DVCEP) 5) EDD Partnership Grants 35 89 1,111 545 102 34 27 1,758 492 1,283 72 8 2,331 424 860 40 2,214 471 950 1,743 1,540 1,738 1,875 137 7.3% 197 12.8% 322 362 252 466 215 46.1% (110) -30.5% 1,400 145 1,400 120 1,400 120 1,400 175 55 0.0% 31.4% - 0.0% 0.0% 3,122 3 1,148 317 4,242 689 1,678 277 4,572 670 1,534 424 5,077 900 1,517 486 505 230 (16) 62 9.9% 25.6% -1.1% 12.8% 330 (19) (144) 147 7.8% -2.8% -8.6% 53.1% 1,382 1,906 1,916 2,304 387 16.8% 11 0.6% 188 - 212 - 237 - 250 50 13 50 5.2% 100.0% 25 - 11.9% 0.0% 13) Equity, Diversity & Inclusion 14) Sustainable Aviation Fuels & Air Emissions Program 15) Low Carbon Fuel Standard Support 16) Community Biz Connector (Regional Small Biz Partnerships) 17) Public Market Study 18) Seattle Aquarium Partnership 1,284 116 29 - 1,319 103 40 25 175 1,100 1,993 - 2,065 150 380 1,000 72 150 (245) (16) (2,500) 3.5% 0.0% 100.0% -64.5% 0.0% -250.0% 675 (103) (40) 600 (159) 2,400 51.2% -100.0% -100.0% 2400.0% -90.9% 218.2% TOTAL w/o DRS PensionTrue-up Credit DRS Pension Credit True Up TOTAL w/ DRS PensionTrue-up Credit 11,554 (218) 11,336 15,991 (331) 15,660 20,014 (277) 19,737 18,803 (1,211) 277 (934) -6.4% 0% -5.0% 4,023 54 4,077 25.2% -16.3% 26.0% 6) Tourism Marketing Support Program 7) Airport Spotlight Ad Program 2 3&4 8) City of SeaTac Community Relief 3 9) Maritime Blue (formerly Maritime Innovation Center) 2 &6 10) Workforce Development a. Youth Career Launch Program (formerly OYI) b. Airport Employment Center 11) High School Internship Program 12) Diversity in Contracting 2 a. Small Bus. Accelarator (DIC) 5 b. DBE/ACDBE/WMBE Training Consultants & Outreach 2 625 16 3,500 Notes: 1) Budget/Actuals show grants only, exclude payroll. 2) DRS Pension credit excluded from dept totals. 3) Budgeted as Non-ops Expenses. 4) Free advertising space provided at the Airport. FAA requires that lost revenue be reimbursed to the Airport. 5) A portion of the SKCCIF budget is in Diversity in Contracting; adjusted to avoid double counting. 6) A portion of the DVCEP for Green Jobs is budgeted under WFD. . 18,803 (72) 32 (117) 46 90 0.0% 79.4% -5.3% 9.9% 9.5% 39 (19) 573 (68) (423) • 114.8% -69.9% 32.6% -13.8% -33.0% • • • Lower than anticipated spending in several programs: Airport Community Ecology, EDD Partnership Grants, Maritime Blue, Youth Maritime Career Launch program, and Low Carbon Fuel Standard support offset by payments to Seattle Aquarium (requested earlier than budget schedule). A portion of the 2023 payment for the Community Business Connector were applied in 2024. Less spending in Outside Services and Payroll savings for Tourism, Diversity in Contracting, Equity, Diversity, & Inclusion, and Workforce Development. Reduction of one available signage for the Airport Spotlight Ad Program due to SEA construction. 85 Page 373 of 373