Template revised January 10, 2019.
COMMISSION
AGENDA MEMORANDUM
Item No.
10d
ACTION ITEM
Date of Meeting
November 17, 2026
DATE: November 2, 2025
TO: Stephen P. Metruck, Executive Director
FROM: Stephanie Jones Stebbins, Maritime Managing Director: Director, Marine Stormwater
Utility
Sandra Kilroy, Sr. Director Environment and Sustainability
Sarah Ogier, Director, Maritime Environment & Sustainability
Kelly Zupan, Director, Seaport Finance & Budget
Jane Dewell, Sr. Manager Environmental Programs/Marine Stormwater Utility
SUBJECT: Adoption of 2027 Marine Stormwater Utility Rate
Amount of this request:
$0
Total estimated project cost:
$0
ACTION REQUESTED
Request Commission authorization for the Executive Director to set 2027 Marine Stormwater
Utility rates with an 8.0% increase from 2026.
EXECUTIVE SUMMARY
The requested authorization will provide a 2027 rate structure to be adopted by the Marine
Stormwater Utility (Utility), in support of Utility obligations to protect water quality, rehabilitate
Port of Seattle (Port) stormwater assets, and support property managers and tenants in
compliance with stormwater permit conditions. The proposed rate is an 8.0% increase from 2026.
This rate increase will help ensure the Utility is able to fund regulatory requirements, asset
rehabilitation projects including some limited capital improvements over the next five years, and
meet target reserve balance by 2031.
JUSTIFICATION
The Stormwater Utility is a self-funded program responsible for maintaining Port Maritime
property stormwater assets and supporting compliance with relevant local, state, and federal
stormwater regulations. Cost for these services continues to increase with regional inflation and
the increasing complexity in Washington State stormwater regulations. A rate increase at the
proposed level of 8.0% allows the Utility to maintain and improve stormwater conveyance and
water quality to meet the Port’s Century Agenda environmental goals by:
1. Meeting or exceeding stormwater regulatory requirements.
2. Investing in streamlining processes, such as GIS mapping and maintenance and inspection
coordination, to improve efficiency and reduce costs of meeting regulatory obligations.
COMMISSION AGENDA – Action Item No. 10d Page 2 of 9
Meeting Date: November 17, 2026
Template revised June 27, 2019 (Diversity in Contracting).
3. Maintaining significant level of investment to rehabilitate, expand and support the
performance of the stormwater system to protect water quality in the Puget Sound.
DETAILS
The Utility was formed in 2014 to enable the Port to provide services, facilities, systems,
programs for surface water, stormwater management, and pollution control. The Utility collects
stormwater fees from all properties within the Port and reinvests that income into maintaining
and upgrading the stormwater infrastructure. Ratepayers include the Port of Seattle, Northwest
Seaport Alliance (NWSA), and tenants. Prior to creating the Utility, stormwater fees were paid by
the Port and its tenants to the City of Seattle (City) and were primarily used to address City
priorities and not necessarily the priority stormwater needs at Port facilities. With the
establishment of a Port Utility, we have realized an increased investment and attention to Port
property stormwater assets and management, including innovative stormwater treatment
systems and aligning investments with sustainability and equity goals. Benefits of Utility work
include water quality protection in the Puget Sound as well as stormwater infrastructure that
better supports Port tenants’ stormwater investments.
The Utility rates apply to all Port-owned maritime (non-aviation) property, which includes land
managed by the NWSA. Tenants pay stormwater fees based on the area of their leaseholds and
what percent of their area is hardscape (impervious) surface. The stormwater fees for the
remaining unleased land at a facility are paid by the operating business. The operating business
is either the NWSA or the specific Port business (Real Estate Portfolio, Maritime Operations,
Cruise, etc.) that oversees the unleased property. Rates are set to recover the cost of Utility
operation and maintenance and support future limited capital improvements. In addition to
funding current operations, maintenance and capital projects, Port policy recommends that the
Utility maintain a reserve fund equivalent to six months of operating expenses. In recent years
due to budget constraints, the reserve fund has not been fully funded. Consequently, in addition,
to this 2027 rate proposal, the Maritime Finance Department has developed a five-year plan for
rebuilding the reserve fund and ultimately maintaining a positive balance in the fund.
The City’s stormwater utility rates, reflected in the City 2025-2030 Strategic Plan Update
(approved September 3, 2024), continue to be on average 15% to 18% higher than the Port’s
stormwater rates.
The Port’s Stormwater Utility rates are approved annually by the Commission. The Utility’s
internal Rate Advisory Committee reviews rate recommendations prior to advancing
recommendations for Commission consideration and approval. An 8.0% increase is
recommended in 2027. This rate will ensure the Utility budget is sufficient to address stormwater
regulatory obligations, some asset improvement projects and contribute towards the Utility’s
reserve fund.
The 2026 Utility rates and proposed 2027 rates with an 8.0% increase are shown in the table
below.
COMMISSION AGENDA – Action Item No. 10d Page 3 of 9
Meeting Date: November 17, 2026
Template revised June 27, 2019 (Diversity in Contracting).
Impact on Rate Payers
The forecasted Utility revenue for 2026 is approximately $9.1 million, and therefore every 1%
rate change is about $91,000. The added revenue generated from an 8.0% increase is
approximately $728,000, providing for an estimated total collection of $9.81 million for
2027. With an 8.0% rate increase, the impact on two hypothetical tenants is provided below:
• A commercial tenant would have a $2.16 monthly increase on a $27.00 bill, for $29.16
per month in 2027.
• An industrial tenant would have a $2,017.60 monthly increase on a $25,220 bill, for
$27,237.60 per month in 2027.
Revenue Collection Distribution
Revenue is collected from all Port properties including leased areas, non-tenant areas used by
Port business units and areas licensed to NWSA. In 2026, approximately 65% of Utility revenue
was from tenant leased properties, both Port and NWSA; 17% from NWSA-licensed non-tenant
properties; and the remaining 18% from Port non-tenant properties.
Utility History
The Utility completed a full system assessment to obtain baseline conditions of the existing
stormwater infrastructure at the end of 2019. As of mid-2026, over 86 urgent repairs of
stormwater infrastructure have been completed since 2016, reducing hazards including flooding
and allowing the conveyance system to function properly, which benefits overall water quality.
Twenty-eight tide gates have been installed, preventing the flow of tidal waters into the
conveyance system and saltwater intrusion that could damage water quality treatment systems;
this is both a safety and an infrastructure improvement.
In 2021, the Utility completed its first five-year strategic plan, which included feedback from Port,
NWSA, and external tenant stakeholders. In early 2026, staff completed an updated strategic
Utility Rate Category
Proposed 2027
(based on % impervious surface)
($ per 1,000 square feet)
Undeveloped (0-15%)
Regular
$59.76
Low Impact
$34.99
Light (16-35%)
Regular
$92.41
Low Impact
$72.69
Medium (36-65%)
Regular
$134.23
Low Impact
$107.97
Heavy (66-85%)
$180.09
Very Heavy (86-100%)
$213.02
COMMISSION AGENDA – Action Item No. 10d Page 4 of 9
Meeting Date: November 17, 2026
Template revised June 27, 2019 (Diversity in Contracting).
plan for 2026 to 2030, with a focus on resilient infrastructure, exceptional value, sustainability,
climate change and resiliency, and equity, diversity and inclusion.
Accomplishments in 2026
Other accomplishments this year include the following:
1) The Utility team, including Marine Maintenance staff, collaborated on the following
accomplishments:
a) Continued to exceed stormwater regulatory requirements, including increased
frequency of sweeping roads and common areas, and installing and maintaining
innovative stormwater treatment to reduce contaminated stormwater reaching state
waterways.
b) Met the 2035 Century Agenda goal of 75% stormwater system rehabilitation in 2025.
Maintaining this level of asset condition into the future is a top priority that supports
improved water quality for the region.
c) Used asset condition data from CCTV inspections and GIS mapping to identify,
prioritize, and phase asset repair and replacement projects.
d) Initiated a study to develop a benchmark for the Utility, considering other regional
Ports and municipalities, and to evaluate rate reductions and credit programs that
may be implemented by the Utility.
e) Collaborated with Port and regional climate change and resilience planning and
research to provide expertise on stormwater infrastructure and forecast impacts. 
f) Continued to follow guidance from the Port’s Executive Director for “resource
conscious” budgeting, and plan for financial uncertainty associated with regional
trade impacts, high regional inflation, and global conflict.  
2) Utility funded and completed Capital Projects:
a) Maritime Industrial Center Storm Drainage Improvements – completed 2025.
b) Terminal 91 Berths 6&8 Water Quality Improvements – completed 2025.
c) 100% design for the Terminal 106 S Nevada Street Storm Drainage Improvement
project - slated for construction in Q4 2026.
d) Shilshole Bay Marina Stormwater Vault Retrofits –construction completed in October
2026.
e) Terminal 91 Elliott Bay Trail Storm Drainage Improvements – completed 90% design
in 2026, slated for construction in Q1 2027.
3) Continued strong partnerships with Waterfront Development Office, Port Construction
Services, Environmental Permitting, Engineering and Marine Maintenance to support
comprehensive capital project review and asset rehabilitation, including detailed
construction plan reviews and targeted training on stormwater regulations and assets.
Scope of Work
Stormwater Utility funds can only be used toward the Port’s maritime stormwater infrastructure
and regulatory programs. As an independent utility, it is critical to maintain a six-month reserve
fund balance. For the last three years, the Utility fell short of maintaining the target six-month
COMMISSION AGENDA – Action Item No. 10d Page 5 of 9
Meeting Date: November 17, 2026
Template revised June 27, 2019 (Diversity in Contracting).
reserve fund balance. The Utility cash balance as of September 30, 2026, was $2.158M with a
projected end-of-year fund balance of $1.40M. The 2026 operating expenses exceeded revenue
by $0.386M and the resulting shortfall will be covered by the reserve fund balance. The 2027
estimated budget of $10.334M will be allocated as follows: $5.019M for maintenance and
expense work, $2.369M in SWU administration, $2.011M for other expenses, and $0.935M in
capital. The projected 2027 revenue with the 8.0% rate change is approximately $9.813M. With
this rate, the Utility will need to tap into reserve funds to cover expenses but has developed a
plan for fully meeting the target reserve in 2031.
The 2027 projected expense and capital budget will fund necessary stormwater management
items including:
1) Perform system assessments to monitor known conditions, maintain the 75%
rehabilitation goal system-wide, and be proactive in asset management.
2) Support capital projects including completing green stormwater infrastructure retrofits
at Shilshole Bay Marina, drainage improvements and removal of contaminated soil along
Elliott Bay pedestrian and bike trail, and purchasing a new plumber van to replace one
that is over 25 years old.
3) Repair damaged stormwater pipes and infrastructure, prioritizing high-use industrial
properties.
4) Perform required regulatory stormwater management activities such as catch basin
inspections and sweeping.
5) Perform additional stormwater management activities that enhance water quality
protection, such as dock cleaning and plaza washing.
6) Evaluate and implement green and innovative stormwater treatment systems.
7) Apply scoring matrix including equity, diversity and inclusion considerations to prioritize
infrastructure work.
8) Implement year two of the updated strategic plan.
9) Participate in Port-wide planning and research for in-depth climate change/resilience
study that includes stormwater infrastructure.
10) Complete the current capital program portfolio including pipe rehabilitation and drainage
improvements.
11) Cover operational and administrative expenses including staff costs, utility taxes and Port
allocations.
Rate Criteria: The following criteria were used in considering the proposed 2027 rate:
1) Maintain adequate budget to meet or exceed stormwater regulatory requirements, the
Port’s Environmental Long-Range Plan, and Utility Charter responsibilities including
rehabilitation of stormwater infrastructure.
2) Continue adequate funding to maintain and improve a high-functioning stormwater
system at 75% level to benefit Puget Sound water quality.
3) Fund the six-month reserve for operating expenses, consistent with financial prudence
based on Port policy and best practices.
COMMISSION AGENDA – Action Item No. 10d Page 6 of 9
Meeting Date: November 17, 2026
Template revised June 27, 2019 (Diversity in Contracting).
4) Maintain a consistent rate increase over the five-year projection, striving for a smooth
rate profile to avoid future steep rate hikes and maintain stable funding for the program.
5) Maintain stormwater utility rates below the City of Seattle stormwater rates.
Although continued economic pressures and uncertainties have forced a Utility rate increase for
2027, the preferred alternative at 8.0% is lower than the 2026 increase of 10.0%. The Utility fund
balance has dropped below the six-month fund reserve for the past three years due to economic
pressures and past depressed rate increases. The low fund balance conflicts with rate criteria the
Utility has followed since 2016. These pressures, listed below, were accounted for when
developing the rate proposal alternatives:
1) During the COVID-19 pandemic (2021-2023), the Utility adopted lower rates of 3.0% and
4.6% to reduce the financial burden to tenants, NWSA, and Port business units, which
resulted in reduced revenue and rates below inflation.
2) As of August 2026, the consumer price index (CPI) for the Seattle area was an overall
increase of 4.4% (12-month period). The Mortenson Construction index, a measure that
tracks non-residential construction costs in Seattle, increased by 3.5% between Q3 2025
and Q3 2026.
3) City of Seattle Use Tax is 12% per the Utility interlocal agreement with the City, signed in
November 2016. The Port of Seattle’s Utility is the only utility to pay this tax.
4) The City of Seattle Business & Occupation tax increased from 1.8% to 2.1% in 2025 and a
0.5% surcharge when revenue is over $250 million. The Utility pays this tax to the City of
Seattle.
5) Rising labor costs and adjustments for Port employees in 2025 and 2026 averaged 3.9%
increase in cost-of-living and pay-for-performance for non-exempt staff. As part of the
Port’s Work History Compensation project, salaries for non-represented positions
increased for approximately 50% of staff with an average increase of 9.6% to payroll
expenses in 2024.
6) Federal Administration tariffs on imports initiated in 2025 continue to increase costs for
construction materials, including petroleum fuels.
Reductions to Marine Maintenance budget in 2026 and continued for 2027, and Capital Program
plan adjustments to delay or phase improvement projects, were made to meet Port Central
Services Budget Guidelines and reflect other internal and external pressures on the Utility.
Schedule
The Utility Rate Advisory Committee reviewed and validated the rate recommendation in
October 2026. If approved by the Commission, the 2027 rates will be adopted by the Utility
effective January 1, 2027. The Utility notifies tenants in December of the upcoming rate change
following adoption. Tenants can dispute billing fees by contacting Utility staff, and a decision will
be made within 60 days of receipt of the dispute.
COMMISSION AGENDA – Action Item No. 10d Page 7 of 9
Meeting Date: November 17, 2026
Template revised June 27, 2019 (Diversity in Contracting).
ALTERNATIVES AND IMPLICATIONS CONSIDERED
Alternative 1 – Increase rates by 8.0% during the 2027 to 2031 plan period
Cost Implications: Projected revenue in 2027 will be $9.813M
Pros:
1) Lower financial impact on tenants, NWSA and Port business units than the other
alternatives.
Cons:
1) Funds fall below the six-month reserve balance beyond 2031.
2) To rectify low fund balance, a higher rate increase in future may be necessary to fund
critical capital investments to meet Century Agenda goals and exceed regulatory
requirements.
3) There is potential need to constrain essential maintenance functions and urgent repairs.
This is not the recommended alternative.
Alternative 2 – Increase rates by 9.0% during the 2027 to 2031 plan period
Cost Implications: Projected revenue in 2027 will be $9.903M
Pros:
1) Builds a greater fund balance to support unexpected repairs and future planned capital
projects in next five years as compared to the recommended alternative.
2) Funds critical capital investments to meet Century Agenda goals and exceed regulatory
requirements.
3) Achieves 111% of the six-month fund balance in 2031.
Cons:
1) Higher financial impact on tenants, NWSA and Port business units than alternative 1 and
the preferred alternative.
This is not the recommended alternative.
Alternative 3 – Increase rates by 10.0% during the 2027 to 2031 plan period
Cost Implications: Projected revenue in 2027 will be $9.994M
Pros:
1) Builds a greater fund balance to support unexpected repairs and future planned capital
projects in next five years as compared to the recommended alternative.
2) Funds critical capital investments to meet Century Agenda goals and exceed regulatory
requirements.
3) Achieves 144% of the six-month reserve balance in 2031.
COMMISSION AGENDA – Action Item No. 10d Page 8 of 9
Meeting Date: November 17, 2026
Template revised June 27, 2019 (Diversity in Contracting).
Cons:
1) Higher financial impact on tenants, NWSA and Port business units than all other
alternatives.
This is not the recommended alternative.
Alternative 4 – Increase rates by 8.0% in 2027 and 9.0% between 2028 to 2031
Cost Implications: Projected revenue in 2027 will be $9.813M
Pros:
1) Builds a greater fund balance to support unexpected repairs and future planned capital
projects in next five years as compared to alternative 1.
2) Funds critical capital investments to meet Century Agenda goals and exceed regulatory
requirements.
3) Lower financial impact on tenants, NWSA and Port business units than the other
alternatives except alternative 1.
4) Achieves 101% of the six-month reserve balance in 2031.
Cons:
1) Higher financial impact on tenants, NWSA and Port business units than alternative 1.
2) Raises less revenue for future capital program than alternatives 2 and 3.
This is the recommended alternative.
FINANCIAL IMPLICATIONS
All revenue collected by the Utility is separate from the Port’s general funds and must be spent
on or for the benefit of the Port stormwater program. The proposed rate increase has several
positive implications including:
1) Maintain funding for critical stormwater infrastructure improvements,
2) Support a six-month fund reserve by 2031, following sound fiscal policy consistent with
standard Port procedure, and
3) Reduce operating costs funded by Port business units and tenants by funding stormwater-
related maintenance activities.
ADDITIONAL BACKGROUND
The Utility maintains a separate accounting fund, known as the stormwater utility fund, to
conduct all business. This fund is separate from the Port general funds and cannot be used for
any purpose other than administering, operating, maintaining, and improving the Port’s
stormwater system. The Utility may borrow money from Port funds as needed, provided that
such funds are paid back in full to the originating funds.
COMMISSION AGENDA – Action Item No. 10d Page 9 of 9
Meeting Date: November 17, 2026
Template revised June 27, 2019 (Diversity in Contracting).
ATTACHMENTS TO THIS REQUEST
(1) Presentation slides
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS
November 11, 2025 – The Commission approved Marine Stormwater Utility Rates for 2026
November 12, 2024 – The Commission approved Marine Stormwater Utility Rates for 2025
November 14, 2023 – The Commission approved Marine Stormwater Utility Rates for 2024
October 25, 2022 – The Commission approved Marine Stormwater Utility Rates for 2023
September 14, 2021 – The Commission approved Marine Stormwater Utility Rates for 2022
October 27, 2020 – The Commission approved Marine Stormwater Utility Rates for 2021
October 8, 2019 – The Commission approved Marine Stormwater Utility Rates for 2020
October 9, 2018 – The Commission approved Marine Stormwater Utility Rates for 2019
November 14, 2017 – The Commission approved Marine Stormwater Utility Rates for 2018
November 18, 2014 – Commission approved Resolution No. 3696, as amended, Authorizing
Stormwater Utility Formation, included utility rates for 2015 through 2017