executive director’s report to the - port of...

EXECUTIVE DIRECTOR’S REPORT TO THE

PORT OF PORTLAND COMMISSION FOR MAY 2015

SAFETY REPORT

Frequency of incidents in April 2015 doubled from six to twelve when compared to April 2014. A near-miss incident involved six employees. Monthly Report of Injury Incidents

Administration There was one non-recordable incident with no time lost:

1. An employee walking through the first floor lobby of the headquarters building fell when her legs gave out. No site hazard or condition was identified as contributing to this incident. No corrective action was recommended.

Aviation There were six near-miss incidents (all related to the same incident), one non-recordable incident and three recordable incidents; one recordable incident resulted in time lost:

2. Six employees providing medical aid to a patient were exposed to bodily fluids when the patient vomited. The patient was initially reported to be suffering from bacterial meningitis. Further inquiry determined that the patient was not diagnosed with this condition. Aircraft Rescue and Firefighting Facility (ARFF) will work with Multnomah County Health Department to ensure timely notification of communicable disease cases for emergency responders. Conflicting communications regarding the patient’s medical condition existed and clarification to ARFF staff arrived outside of the 72-hour window advised for exposure evaluation/treatment protocols for this condition. Personal protective equipment was worn by all workers during this response.

3. Two employees were attempting to take a combative subject into custody. The subject

resisted arrest, and as a result, one employee received a laceration to the wrist. No corrective action was recommended as this incident resulted from the unpredictable behavior of a subject being taken into custody. The employees used appropriate training tactics to gain physical control of the combative individual.

4. An employee was working on a ladder pulling wire and installing electrical conduit in a

difficult to reach and tight location. When the employee reached for the conduit, he felt pain in his back. During the weekly department safety meeting, the work group discussed taking adequate time to set up work areas and equipment to reduce exposure to overreaching.

2

5. An employee had arrested a subject and reached to retrieve the subject's wallet from his side cargo pants pocket. The employee received a minor cut to the index and middle fingers due to a loose straight edge razor blade within the wallet. The employee was briefed to “expect the unexpected” during a search of subjects and their property. Puncture resistant gloves are available for use and should have been worn.

6. While responding to an emergency call, an employee exited a Port of Portland Fire Department vehicle and stepped back to close the door. The employee was unaware of the difference in the elevation of the asphalt. The employee stepped into a 30-inch culvert causing jarring to the hip, leg, knee and ankle, resulting in time lost. The Fire Department vehicle had parked in a location that put the vehicle’s passenger door flanked by a gap in the curb (storm water drain) that surrounded a culvert yet to be landscaped. This created a significant drop from the asphalt level. ARFF Command staff will brief all personnel on the positioning of apparatus in order to avoid obstacles and to be aware of vehicle surroundings when disembarking.

Marine There was one recordable incident with no lost time:

7. An employee used a break room chair for step-ups (exercise) during a break. The chair tipped out from under the employee, causing the employee to fall and land on the chair. The employee dislocated her shoulder. The employee was coached by management on the use of office furniture only for the intended purpose. During the department’s regular monthly meeting, management reviewed the incident with the entire work group. All employees were advised to contact the Safety or Wellness Committee to request more information on stretching/flexibility activities suitable to an office environment.

4

Recordable and DART Rate Charts The Days Away, Restrictions and Transfers (DART) and Recordable Rate tables are used as bench marking data. The Oregon Occupational Safety and Health Association’s (OR-OSHA) comparative industry group statistics, which track recordable injuries, illnesses, and DART rates, are the best benchmarking data available. Recordable incidents are injuries or illnesses resulting in medical treatment beyond first aid. DART incidents are injuries or illnesses that result in days away from work or restricted work duties and are a subset of Recordable incidents. Please note that OSHA recordable and DART rates are based on number of cases only (normalized at 200,000 hours), and DART rates do not take into account the actual number of lost or modified days that are incurred (normalized at 180 days).

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AVIATION REPORT

Air Service Development

Icelandair began new non-stop service to Reykjavik on May 20. General Aviation

A new parallel runway, measuring 60-feet wide and 3,600-feet long, opened at Hillsboro Airport. The new runway will allow for recreational and flight training activities, while preserving the main runway for business aviation activity.

Passenger volumes increased 2.6 percent compared to April 2014. Seat capacity declined 1.7 percent, with the load factor increasing 3.6 points to 85.5. Portland International Airport has seen six months of negative seat capacity growth as some carriers reduced flying during the winter and early spring season. Demand has remained strong and we are seeing record load factors of 85 percent for the current fiscal year. Heading into the summer months, seat capacity will grow, facilitating passenger expansion.

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May

-13

Jun-

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Jul-1

3

Aug

-13

Sep

-13

Oct

-13

Nov

-13

Dec

-13

Jan-

14

Feb

-14

Mar

-14

Apr

-14

May

-14

Jun-

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Jul-1

4

Aug

-14

Sep

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Oct

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Nov

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Dec

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15

Feb

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Mar

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Apr

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Seats Passengers Load Factor

Passengers per Month

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Cargo volumes increased 3.5 percent compared to April 2014. FedEx volumes increased 2.2 percent to 9,903 tons, and UPS volumes increased 2.0 percent to 5,463 tons.

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24M

ay-1

3

Jun-

13

Jul-1

3

Aug-

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Sep-

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Oct

-13

Nov

-13

Dec

-13

Jan-

14

Feb-

14

Mar

-14

Apr-1

4

May

-14

Jun-

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Jul-1

4

Aug-

14

Sep-

14

Oct

-14

Nov

-14

Dec

-14

Jan-

15

Feb-

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Mar

-15

Apr-1

5

Tons

(Tho

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Cargo Tons per Month Cargo Carried by Air Cargo Carriers

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Public parking revenue was up 4.3 percent over April 2014. This was the first month that compares the new daily maximum rates, month over month, since the rate adjustment in April 2014. Parking transactions were up 2.5 percent.

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May

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Jun-

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13

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Oct

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Nov

-13

Dec

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Jan-

14

Feb-

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Mar

-14

Apr-

14

May

-14

Jun-

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Jul-1

4

Aug-

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Sep-

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Oct

-14

Nov

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Mar

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Apr-

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Rev

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Passengers Garage Valet L.T. Econ. Total

Excludes coupons & employee lots*Includes valet revenue

Parking Revenue by Lot

8

In this fourth month of concessions transition, combined retail and food and beverage operations reported an 8.1 percent, or $75,000, rent increase on the month, against a 2.6 percent passenger increase. Rent performances from new operators of $145,000, offset last year’s rents from previous operators of $141,000 by $4,000, or 2.8 percent. Rent increases totaling 46 percent, or $23,000, from Sandoval’s Tequila Grill and Capers Café, associated with the concessions transition; and 36 percent, or $18,000, from the Made in Oregon stores, associated with sales of PDX Carpet merchandise and Oregon vineyard sampling and promotions, were the major contributors to the overall increase on the month.

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Apr

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14

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Aug

-14

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15

Feb-

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Mar

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Pass

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Passengers Food Retail Total Food/Retail

Concessions Revenue

9

Rental car operations reported a 2.8 percent, or $39,000, rent increase on the month over last year, against a passenger increase of 2.6 percent. All operators reported rents at Minimum Annual Guarantees, with the exception of Alamo and Budget. CAPITAL GRANTS

Hillsboro Airport (HIO) Staff submitted a reimbursement request to the Federal Aviation Administration for the Airport Improvement Program – HIO 23, HIO Parallel 3rd Runway project in the amount of $1,450,000 (Agreement No. 03-41-0025-023). Staff submitted a reimbursement request to the Oregon Department of Transportation (ODOT) for the ConnectOregon III – HIO Runway 12L30R and Taxiway D project in the amount of $34,274 (Agreement No. 26905). Marine

Staff submitted a reimbursement request to ODOT for the ConnectOregon III –Terminal 6 (T-6) Crane Upgrade project in the amount of $30,641 (Agreement No. 26915).

Staff submitted a reimbursement request to ODOT for the ConnectOregon IV – T-6 Wharf Optimization project in the amount of $8,984 (Agreement No. 28695).

Staff submitted a reimbursement request to ODOT for the ConnectOregon V – T-6 Crane Drive Electronics project in the amount of $4,410 (Agreement No. 30128).

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May

-13

Jun-

13

Jul-1

3

Aug-

13

Sep-

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Oct

-13

Nov

-13

Dec

-13

Jan-

14

Feb-

14

Mar

-14

Apr-1

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May

-14

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Passengers Rental Car

Rental Car Revenue

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MARINE & INDUSTRIAL DEVELOPMENT REPORT

The figures in the table below show change relative to the prior year.

April 2015 Fiscal Year-to-Date

Total Tonnage -29.9% -10.1%

Containers (TEU) -97.0% -29.2%

Import Full Containers -100.0% -28.9%

Export Full Containers -89.3% -37.7%

Breakbulk -100.0% -82.6%

Autos -32.6% -8.0%

Mineral Bulk 44.5% 8.7%

Grain -56.1% -4.6%

Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

2015 16,427 20,530 19,639 16,641 73,237

Mo/Mo % Change -22% 22% -8% -33%

CY/CY % Change -22% -2% -4% -13%

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# of UnitsAutomobile - Exports and Imports

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Total Bulks

000's of Short Tons Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

2015 828 754 721 852 3,155

Mo/Mo % Change 8% -19% -24% -4%

CY/CY % Change 8% -7% -13% -11%

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Short TonsBulk Cargoes Mineral Bulks

Grain

Containers Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

2015 4,352 4,642 3,460 225 12,679

Mo/Mo % Change -48% -43% -57% -97%

CY/CY % Change -48% -45% -49% -60%

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# of MovesContainers & TEUs - Terminal 6 Exports (in TEUs)

Imports (in TEUs)

Ttl # of Containers

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Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Total

2015 493 570 164 1,227

Mo/Mo % Change -33% -40% #DIV/0!

CY/CY % Change -33% -37% -27%

0

500

1,000


# of Moves Barge Moves - Terminal 6

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Operations Port and ICTSI staff are working towards a maintenance plan for the Terminal 6 cranes during the absence of vessels calling Terminal 6. Security staffing at the container yard has been reduced. Land Use/Planning & Development Pembina project work is on-going, including outreach to the Portland City Council, tours of the proposed facility and other outreach and coordination. Mayor Hales withdrew his support for the Pembina project on May 14. Industrial/Economic Development Port staff established a trade and logistics team with Business Oregon and the Oregon Department of Transportation to work on the Governor’s strategic reserve fund project supporting interim freight logistics solutions for Oregon shippers. The project includes four elements: 1) trade research; 2) statewide and regional workshops; 3) freight logistic project business cases; and 4) report to the 2016 Legislature with funding recommendations. This project is intended to work in tandem with the Port’s efforts to resolve labor-management issues and secure new service to Terminal 6. A statewide meeting is tentatively scheduled for June 12 with regional meetings to follow in five to six locations over the summer. Port staff testified before the state Joint Ways and Means Subcommittee on Capital Construction in support of the lottery bonding budget (House Bill 5030). This includes Business Oregon funding for site readiness and levees, Regional Solutions funding for regional priorities (including $1.2 million for Troutdale Reynolds Industrial Park (TRIP), Phase 2), and ConnectOregon funding for multi-modal transportation projects. FedEx Ground has provided the executed TRIP Lot 1 purchase and sale agreement and deposited earnest money in escrow. The Port and FedEx Ground are working on the option agreements for Lots 3 and 10, which are contingencies of sale closing. FedEx Ground has deferred its NW Regional Hub expansion until 2016 due to capital constraints, but is proceeding with the TRIP Lot 1 acquisition. REAL ESTATE TRANSACTIONS EXECUTED PURSUANT TO DELEGATED AUTHORITY FedEx Ground Package System, Inc. – Sale Agreement and Receipt for Earnest Money

Location: TRIP

Term: Effective May 1, 2015

Use: Allows FedEx to purchase TRIP Lot 1 to expand the northwest regional distribution hub.

Trammell Crow Portland Development II, Inc. – Permit and Right of Entry

Location: Gresham Vista Business Park

Term: May 18, 2015 to August 31, 2015

Use: Allows entry to Port property for the purpose of due diligence activities.

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Richards Homewares, Inc. – Permit and Right of Entry

Location: Terminal 4

Term: May 19, 2015 to May 30, 2016

Use: Allows entry to Port property for the purpose of parking truck trailers containing inventory.

Peninsula Airways, Inc. – Conditional Letter of Authorization

Location: PDX


Use: Sets the terms for Peninsula Airways to operate at PDX under Ordinance 433-R, including the proof of insurance terms and amount required for its security deposit.

Flair Airlines, Ltd – Conditional Letter of Authorization

Location: PDX


Use: Sets the terms for Flair Airlines to operate at PDX under Ordinance 433-R, including the proof of insurance terms and amount required for their security deposit.

Jessica Teufel – Guaranty

Location: Hillsboro Airport


Use: Jessica Teufel is fully and unconditionally guaranteeing ground lease 2003-224.

Triad International Maintenance Corporation dba Haeco Americas Line Services – Operating Agreement

Location: PDX

Term: Month-to-month, effective May 1, 2015

Use: Sets terms and allows Triad/Haeco to provide aircraft maintenance at PDX.

PDXCurrent Year-to-Date Annual Year-to-Date Actual Amounts

AdoptedBudget

ActualAmounts

%Variance

AdoptedBudget

CurrentYear

PriorYear

%Variance

Total Passengers (in millions) 13.1 13.2 0.9% 15.9 13.2 12.7 3.6%Landed Weight (Sig & Non Sig lbs. in millions) 8.2 8.0 -1.9% 9.9 8.0 8.1 -0.9%Operations N/A 160,251 N/A N/A 160,251 159,189 0.7%

Parking Transactions: Valet N/A 10,382 N/A N/A 10,382 8,427 23.2%Parking Transactions: Long-term (P2) Garage N/A 277,283 N/A N/A 277,283 259,404 6.9%Parking Transactions: Garage N/A 1,042,089 N/A N/A 1,042,089 1,019,432 2.2%Parking Transactions: Economy Lot N/A 340,219 N/A N/A 340,219 313,450 8.5%Parking Transactions: Total N/A 1,669,973 N/A N/A 1,669,973 1,600,713 4.3%

Cost per Enplaned Passenger (Rent & Landing Fees) 9.94$

AIRLINE COST CENTER (ACC) (in millions)Airline Rent, Landing Fees & Other $82.7 $82.9 0.2% $99.6 $82.9 $82.2 0.9%Retail, Food & Beverage 10.5 10.5 0.0% 13.1 10.5 10.6 -0.9%Other Non-Airline 4.0 4.4 10.0% 4.7 4.4 3.3 33.3%TOTAL REVENUE $97.2 $97.8 0.6% $117.4 $97.8 $96.1 1.8%

Personnel Services $27.6 $27.0 -2.2% $33.1 $27.0 $26.2 3.1%Materials, Services & Other 35.4 34.7 -2.0% 42.9 34.7 33.8 2.7%TOTAL EXPENSES $63.0 $61.7 -2.1% $76.0 $61.7 $60.0 2.8%

Debt Service & Coverage $34.6 $34.5 -0.3% $41.5 $34.5 $34.6 -0.3%less: Interest Income 0.0 0.0 0.0 0.0 0.0 0.0%TOTAL NON-OPERATING $34.6 $34.5 -0.3% $41.5 $34.5 $34.6 -0.3%

SURPLUS/(DEFICIT) ($0.4) $1.6 -500.0% ($0.1) $1.6 $1.5 6.7%

PORT COST CENTER (PCC) (in millions)Parking $46.5 $48.3 3.9% $56.3 $48.3 $43.6 10.8%Rental Cars 16.5 16.6 0.6% 18.7 16.6 16.1 3.1%Other 16.3 16.9 3.7% 19.5 16.9 15.9 6.3%TOTAL REVENUE $79.3 $81.8 3.2% $94.5 $81.8 $75.6 8.2%

Personnel Services $11.5 $11.2 -2.6% $13.8 $11.2 $10.8 3.7%Materials, Services & Other 20.5 19.3 -5.9% 24.8 19.3 18.5 4.3%TOTAL EXPENSES $32.0 $30.5 -4.7% $38.6 $30.5 $29.3 4.1%

Debt Service & Coverage $14.9 $14.9 0.0% $17.9 $14.9 $14.8 0.7%less: Interest Income (0.4) (0.6) 50.0% (0.5) (0.6) (0.7) -14.3%TOTAL NON-OPERATING $14.5 $14.3 -1.4% $17.4 $14.3 $14.1 1.4%

LESS: REVENUE SHARING $8.4 $8.4 0.0% $10.1 $8.4 $8.0 5.0%

INCOME $24.4 $28.6 17.2% $28.4 $28.6 $24.2 18.2%

General AviationCurrent Year-to-Date Annual Year-to-Date Actual Amounts

AdoptedBudget

ActualAmounts

%Variance

AdoptedBudget

Current Year Prior Year

%Variance

TOTAL REVENUE 3,042,834 2,941,952 -3.3% 3,589,291 $2,941,952 $2,620,426 12.3%

TOTAL EXPENSE 3,051,855 3,530,698 15.7% 3,612,940 3,530,698 2,642,810 33.6%

OPERATING INCOME (EXCL. DEPR) ($9,021) ($588,746) 6426.5% ($23,649) ($588,746) ($22,384) 2530.2%

AVIATION DIVISIONFINANCIAL REPORT

April 2015

COMMENTS (Aviation Financial Report)

BUDGET - This report compares actual amounts against the adopted budget.

ACTIVITY

Passenger traffic exceeded the prior year by 3.6%. Parking transactions exceeded the prior year by 4.3%. Landed weight is down 0.9%.

AIRLINE COST CENTERS

Airline rents and landing fees are approximately $200K higher than budget, primarily due to higher than expected common use rentals (up ~$400K),

higher terminal rents (up ~$300K); offset by lower landing fees (down ~$500K).

Retail and food and beverage revenues are in line with budget; retail concessions are up ~$400K but are offset by lower food and beverage

revenues, primarily due to timing of store openings for new concessions (down ~$400K).

Other non-airline revenues are approximately $400K higher than budget, primarily due to higher than expected advertising revenues (up ~$140K).

Other positive variances include: non-airline terminal rent revenues and maintenance reimbursements (up ~$60K), unbudgeted SmartCarte and

Clear Wireless revenues (up ~$50K), an unbudgeted reimbursement from the ORANG for their share of FY14 deicing costs (up ~$40K), and higher

Ordinance-389 airline landings (up ~$40K).

PORT COST CENTERS

Parking revenues are approximately $1.8M higher than budget due to higher than anticipated activity in the economy lot and long- term garage.

Other Port Cost Center revenues are approximately $600K higher than budget, primarily due to higher than budgeted Air Trans Center rent (up

~$200K), hotel revenues (up ~$150K), and PIC rent revenues (up ~$120K).

AIRLINE (ACC) & PORT COST CENTERS (PCC)

Personnel Services are approximately $900K lower than budget (~$600K in ACC and ~$300K in PCC), due to lower Police and Administration costs,

primarily attributed to vacancies.

Materials and Services expenses are approximately $1.9M lower than budget. ACC is ~$700K lower due to a reduction in allocated support services

made in April due to shared services department expenses running below budget (down ~$230K). Additionally, the Port has received credits

totaling $275K, related to insurance policy recovery payments for the McBride Slough remedial investigation andjJet fuel contamination expenses.

PCC is ~$1.2M lower than budget. The largest items making up this variance are parking management fees (down ~$200K), the timing of budgeted

environmental expenses (down ~$280K), and a reduction in allocated support services (down ~$410K).

GENERAL AVIATION

Revenues are approximately $100K lower than budget. An FAA tree removal grant was budgeted for July (at $100K) and has not been received.

Expenses are approximately $480K over budget, primarily due to higher than budgeted outside legal fees associated withthe appeal of HIO

supplemental environmental assessment (up ~$100K), utilities (up ~$80K), equipment repair (up ~$80K) ,inter-departmental charges from PDX and

Engineering (up ~$50K), Materials/Supplies (up ~$40K), Outside Services (up ~$35K), and overtime wages (up ~$30K).

MARINE Annual

Adopted Budget

Actual Amounts

Variance Adopted Budget

CurrentYear

PriorYear

Variance

VOLUMESAutos (Units) 212,126 224,756 6.0% 256,500 224,756 237,435 (5.3%)

Breakbulk (Short Tons) 91,381 123,329 35.0% 110,231 123,329 140,668 (12.3%)Containers (TEUs) 160,738 101,951 (36.6%) 192,500 101,951 144,065 (29.2%)Grain Bulk (Short Tons) 3,302,525 3,252,918 (1.5%) 3,858,090 3,252,918 3,409,678 (4.6%)Mineral Bulk (Short Tons) 4,272,479 4,654,777 8.9% 5,198,500 4,654,777 4,315,952 7.9%

All dollars in millions; OIBD = Operating Income Before Depreciation

TOTAL MARINEOperating Revenues $26.3 $27.5 $1.2 $31.6 $27.5 $26.8 $0.7Operating Expenses 26.0 22.7 (3.3) 30.9 22.7 23.3 (0.6)

OIBD $0.3 $4.8 $4.5 $0.7 $4.8 $3.5 $1.3Depreciation 9.0 8.7 (0.3) 10.7 8.7 8.7 0.0OPERATING INCOME/(LOSS) ($8.7) ($3.9) $4.8 ($10.0) ($3.9) ($5.2) $1.3

AUTOSOperating Revenues $5.9 $6.3 $0.4 $7.0 $6.3 $6.0 $0.3Operating Expenses 1.1 1.0 (0.1) 1.2 1.0 1.1 (0.1)

OIBD $4.8 $5.3 $0.5 $5.8 $5.3 $4.9 $0.4

BREAKBULKOperating Revenues $1.0 $1.3 $0.3 $1.3 $1.3 $1.7 ($0.4)Operating Expenses 0.9 1.2 0.3 1.1 1.2 1.0 0.2

OIBD $0.1 $0.1 $0.0 $0.2 $0.1 $0.7 ($0.6)

CONTAINERSOperating Revenues $9.2 $9.0 ($0.2) $11.0 $9.0 $8.6 $0.4Operating Expenses 11.1 9.7 (1.4) 12.7 9.7 8.9 0.8

OIBD ($1.9) ($0.7) $1.2 ($1.7) ($0.7) ($0.3) ($0.4)

GRAIN BULKOperating Revenues $2.6 $2.3 ($0.3) $3.0 $2.3 $2.6 ($0.3)Operating Expenses 0.3 0.0 (0.3) 0.4 0.0 0.0 0.0

OIBD $2.3 $2.3 $0.0 $2.6 $2.3 $2.6 ($0.3)

MINERAL BULKOperating Revenues $5.2 $5.6 $0.4 $6.2 $5.6 $5.2 $0.4Operating Expenses 1.2 1.1 (0.1) 1.5 1.1 1.9 (0.8)

OIBD $4.0 $4.5 $0.5 $4.7 $4.5 $3.3 $1.2

MARINE SUPPORTOperating Revenues $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0Operating Expenses 9.0 7.9 (1.1) 10.7 7.9 8.9 (1.0)

OIBD ($9.0) ($7.9) $1.1 ($10.7) ($7.9) ($8.9) $1.0

MARINE PROPERTY MGMTOperating Revenues $2.5 $2.9 $0.4 $3.0 $2.9 $2.7 $0.2Operating Expenses 2.3 1.8 (0.5) 2.7 1.8 1.5 0.3OIBD $0.2 $1.1 $0.9 $0.3 $1.1 $1.2 ($0.1)

MARINE ENVIRONMENTAL (T4)Operating Revenues $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $0.0Operating Expenses 0.0 0.0 0.0 0.5 0.0 0.0 0.0

OIBD $0.0 $0.0 $0.0 ($0.5) $0.0 $0.0 $0.0Note: Totals may not add due to rounding

Current Year-to-Date Year-to-Date Actual Amounts

GENERAL FUNDFINANCIAL REPORT

April 2015

COMMENTS (Marine Financial Report)

Operating revenues are $1.2M higher than the Adopted Budget due to higher than anticipated auto dockage, YTD activity at T-2 and at T-5 for potash, T-4 lay dockage, and Vigor's use of Berth 315. Operating expenses are $3.3M under budget, with the largest variances listed below.

Contracts, Professional & Consulting Services are $1.8M under budget. Container LOB (T-6) contracts and outside services are under budget ~ $757K YTD primarily due to favorable T-6 berth dredging project results. The Port didn't have to dredge as much material as expected and was able to dispose in water. In addition, the Port recovered $213K in legal expenses related to ILWU claims for costs exceeding the self-insured retention threshold. The annual hydrographic survey showed neither Columbia Grain nor Portland Bulk's berths required dredging as assumed in the budget ($200K YTD). With Hanjin and Hapag-Lloyd no longer calling, there will be no transload program expenses this fiscal year ($300K YTD). Labor issues at T-5 have been resolved, which means there are no security expenses as the budget assumed ($178K YTD). [This also means invoicing Columbia Grain the respective permit access fees ended in September (~ $25K per month).]

Longshore labor expenses are $654K under budget due to reefer work transitioning to Port IBEW electricians in November.

Personnel services are $883K under budget due to vacancies and a reduction in electricians and security officers after the departure of carriers at T-6.

Materials & supplies expenses are $645K over budget primarily due to materials for T-6 crane repairs and the transition to Harbor Industrial as the new crane services provider ($701K). ICTSI reimburses the Port for a portion of these expenses.

Travel and management expenses are $305K under budget.

Allocated support was adjusted in April since support services departments are under budget on expenses. Marine's share of overhead is now $228K under budget.

Other expenses are $47K over budget due to YTD carrier incentive payments slightly exceeding the budgeted $2M.

Business Line Summaries

Autos – YTD autos are 6% more than forecast but 5% less than last year. The prior year variance is primarily because Honda Fit production moved to Mexico. It was previously imported from Japan through T-6. YTD autos exceed this year's forecast due to Ford export volumes.

Breakbulk – YTD tonnage is 12% greater than what was forecast for the entire year.

Containers – TEUs are down 37% from the forecast and 30% from last year due to the departure of Hanjin, Hapag-Lloyd and Westwood amid labor issues at T-6. Only 1 Westwood vessel called T-6 in April. Volumes will decrease sharply in the coming months.

Grain Bulk – YTD grain volumes are almost in line with the forecast and 5% lower than last year. Revenues and expenses are both slightly under budget because budgeted fees and security expenses associated with the labor dispute were not realized after the dispute was resolved in August.

Mineral Bulk – Overall, volumes are about 9% higher than forecasted and 8% better than last year. Potash is the driver for the positive variance at 24% higher than forecasted and 26% better than last year. YTD soda ash volumes lag behind the forecast and last year (4% and 6% respectively).

INDUSTRIAL DEVELOPMENT Annual(Includes Land Use Planning) Adopted

Budget Actual

Amounts Variance

Adopted Budget

CurrentYear

PriorYear

Variance

Operating Revenues $3.1 $3.0 ($0.1) $3.5 $3.0 $2.9 $0.1Land Sales 0.0 0.0 0.0 6.2 0.0 1.4 (1.4)Operating Expenses 6.5 5.0 (1.5) 7.9 5.0 5.4 (0.4)Cost of Property Sold 0.0 0.0 0.0 3.8 0.0 0.6 (0.6)OIBD (Op Income Before Depreciation) ($3.4) ($2.0) $1.4 ($2.0) ($2.0) ($1.7) ($0.3)Depreciation 0.7 0.6 (0.1) 0.8 0.6 0.6 0.0OPERATING INCOME/(LOSS) ($4.1) ($2.6) $1.5 ($2.8) ($2.6) ($2.3) ($0.3)

NAVIGATION Annual

VOLUMES Adopted Budget

Actual Amounts

Variance Adopted Budget

CurrentYear

PriorYear

Variance

Dredging Days 116 132 13.8% 132 132 78 69.2%Cubic Yards Dredged 3,029,477 3,029,477 1,987,724 52.4%

Operating Revenues $11.9 $15.4 $3.5 $14.4 $15.4 $9.5 $5.9Operating Expenses 10.1 13.2 3.1 12.3 13.2 8.7 4.5

OIBD (Op Income Before Depreciation) $1.8 $2.2 $0.4 $2.1 $2.2 $0.8 $1.4

Depreciation 2.5 1.6 (0.9) 2.9 1.6 1.4 0.2

OPERATING INCOME/(LOSS) ($0.7) $0.6 $1.3 ($0.8) $0.6 ($0.6) $1.2

Note: Totals may not add due to rounding.

COMMENTS

GENERAL FUNDFINANCIAL REPORT

April 2015

Year-to-Date Actual Amounts

Current Year-to-Date Year-to-Date Actual Amounts

Current Year-to-Date

Industrial Development – Operating revenues are in line with the Adopted Budget. Operating expenses are $1.5M under budget, with the largest variances listed below.

Timing of consulting and outside services for future phases of TRIP development, industrial land readiness studies, and invasive species monitoring and other environmental expenses. (~$485K).

Personnel services are $308K under budget due to position vacancies.

Allocated support was adjusted in April since the support services departments are under budget on expenses. Industrial Development's share of overhead is now $219K under budget.

Travel and management expenses (primarily for conferences) are $49K under budget.

Other expenses are approximately $50K under budget primarily due to the timing of the Port's share of matching funds for the Columbia / MLK intersection project.

Interdepartmental charges are $302K under budget primarily due to lower than anticipated services received from Engineering.

Navigation – February 26 was the last dredging day until the 2015 season begins, resulting in 16 more dredging days YTD than budgeted. Total operating expenses before depreciation are almost $3.1M over budget, with the largest variances listed below.

Personnel services are $1.9M over budget due to site prep in March, the longer than anticipated dredging season, and significant down time required for pump and engine repairs. To make up for the down time, the department had to rely on overtime, which makes up 33% of the personnel variance.

Materials & supplies are $615K over budget due to the longer dredging season and materials needed for repairs.

Navigation's share of allocated support is $153K over budget due to the higher expenses as a result of the longer dredging season.

Equipment rental, repairs & fuel are $88K over budget. Fuel costs are almost $200K under budget due to improved fuel efficiency after the repower, but other costs YTD offset these savings. Repairs and renewal expenses are $129K over budget due to problems with the engine and pump. Equipment rental expenses are $155K over budget due to the longer season and site prep work in March.

Depreciation is ~ $803K less than budgeted due to a delay in capitalization (start of depreciation) for the dry dock and related assets and a longer depreciable life for these assets than originally estimated.

Contracts Over $50,000 Pursuant to Delegated Authority

Monthly Report for May 2015 (April Activity)

TitleRequestor

DepartmentVendor Name

P.O. Amount

Purchase software as a service for storage and management of contacts.

Information Technology

Dell Marketing LP

$53,689

Purchase subscription services to airport information portal.

Airport Operations Passur Aerospace, Inc.

$61,800

Obtain design services for the PDX Central Utility Plant Chilled Water Capacity Project.

Engineering Project Development

Affiliated Engineers NW, Inc.

$69,673

Obtain outside legal services for 2015 bonds refunding matter.

Legal Orrick Herrington & Sutcliffe LLP

$70,000

Obtain outside legal services for 2015 bonds disclosure counsel matter.

Legal Orrick Herrington & Sutcliffe LLP

$75,000

Obtain absence management services.

Human Resources Standard Insurance Company

$92,900

New Purchases

APPROVAL LIMITS (Administrative Policy 7.2.3)

All expenditures require management approval:

BUDGET Approval by managers in an amount delegated by Directors $ 0 - $ 25,000

APPROVAL Approval by Directors $ 25,001 - $250,000

Approval by Executive Director $ 250,001 +

Contracting authority is limited to the following:

CONTRACTING Directors Up to $ 10,000

APPROVAL Buyers Up to $ 50,000

Manager of Contracts & Procurement Up to $ 250,000*

Executive Director Up to $ 500,000*And any amount approved by Commission

Obtain software license upgrades for network security applications.

Information Technology

Dell Marketing LP

$105,800

Purchase 30-inch discharge hoses for dredging operations.

Engineering Design Services

Salem-Republic Rubber

$127,094

Obtain energy efficiency upgrades at Marine Terminal 2.


Johnson Controls, Inc.

$204,305

Obtain design services for the PDX Concourse D West HVAC Replacement Project.


Burns & McDonnell

$1,607,274

Obtain construction services for the PDX Grease Separation Project.


Payne Construction, Inc.

$3,753,251

Obtain construction services for the PDX Taxiway E North Rehabilitation Project.


K&E Excavating, Inc.

$11,682,488

TitleRequestor


Original Amount

Previous Changes to

Contract

Current Change to Contract

New Contract Total

Amendments Nos. 6 and 7 to purchase additional industrial supplies for dredging operations.

Navigation Grainger $45,000 $238,000 $55,000 $338,000

Amendment No. 16 to obtain construction support services for the Troutdale Reynolds Industrial Park Phase 2 work.


Cardno, Inc. $249,967 $729,683 $583,243 $1,562,893

Change order No. 8 to obtain additional construction services related to the Replace Access Control System Project.


Hoffman Construction Company of Oregon

$1,993,816 $38,958,948 $675,051 $41,627,815

Administrative action to add funds to obtain financial advisory services for three additional years of the five-year agreement.

Controller Public Financial Management, Inc.

$250,000 $250,000 $750,000 $1,250,000

Contracts in this category are initially awarded with a specific work scope and an identified not-to-exceed project total.

Change Orders and Amendments to Project-Specific Contracts

TitleRequestor


Original Task Order Amount

Previous Changes to Task

Order

Current Change to Task Order

New Task Order Total

Total Contract Activity -

All Task Orders

Task order against contract No. 892 to obtain consulting services for strategic plan system.

Research & Strategic Analysis

Coraggio Group, Inc.

$51,000 $51,000 $51,000

Task order against contract No. 767 to obtain study of remote overnight parking for aircraft.

Airport Operations HNTB Corporation

$63,386 $63,386 $914,848

Task order against contract No. 828 to obtain surveying support for the Economy Lot Bus Route Rehabilitation Project.


OBEC Consulting Engineers, Inc.

$67,689 $67,689 $141,133

Task order against contract No. 867 for updated tenant design standards for post-security concessions redevelopment.


DBC Architecture, Inc.

$107,501 $107,501 $503,766

Task order against contract No. 827 to obtain surveying support for the Taxiway E North Rehabilitation Project.


Otak, Inc. $111,330 $111,330 $308,858

Task order against contract No. 742 to obtain construction inspection support services.


Hatch Mott Macdonald Holdings, Inc.

$115,085 $115,085 $1,629,835

Task order against contract No. 744 to obtain construction management services.


URS Corporation $137,725 $137,725 $1,196,070

Task order against contract No. 752 to obtain engineering support for the North Rivergate Boulevard Overcrossing Project.


HDR Engineering, Inc.

$149,993 $149,993 $233,252

Items in this category are issued against contracts that were initially awarded with no specific work scope or product quantity identified (e.g., "requirements" or "on-call" contracts). These contracts establish pricing or rates for products or work that may be needed over a stated term. Estimated quantities may be identified, but no guarantee of actual contract compensation or work is made. Contract durations may be short-term or for multiple years with optional renewal/extension terms.

New Task Orders and Changes to Task Orders Against Non-Project Specific Contracts

Task Order against contract No. 742 to obtain construction inspection support services.



$153,298 $153,298 $1,629,835

Task order against contract No. 744 to obtain construction management services.


URS Corporation $191,546 $191,546 $1,196,070




$192,205 $192,205 $1,629,835




$193,235 $193,235 $1,629,835

Task order against contract No. 768 to obtain design services for a new stormwater pipe from McBride Slough to the Columbia Slough.


CH2M HILL Engineers, Inc.

$249,854 $249,854 $397,512

Amendment No. 9 to task order against contract No. 300 for Janitorial Services for PDX Food Court areas for 2015 contract term.

Airport Properties Portland Habilitation Center, Inc.

$524,218 $3,420,647 $642,000 $4,586,865 $6,213,814

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