executive director’s report to the port of portland … · for fiscal year 2016/17, public...

EXECUTIVE DIRECTOR’S REPORT TO THE

PORT OF PORTLAND COMMISSION FOR JULY 2017

SAFETY REPORT

Port of Portland June 2017 safety performance resulted in a lower frequency of incidents and lower claims frequency compared to June 2016. There were six reported incidents that occurred in June 2017 and of those incidents, two resulted in claims and OSHA recordable cases. Monthly Report of Injury Incidents

Administrative One non-recordable incident:

• Worker was walking to the terminal and reported health related symptoms. Aviation

Two lost time recordable incidents:

• Worker was hit by a vehicle while in the crosswalk directing traffic. The worker complained of shoulder pain and anxiety due to confrontation from the driver.

• Worker sprained a finger during physical fitness training.

Three non-recordable incidents:

• Worker struck head on garage door track while moving tires on storage mezzanine, resulting in a headache and sore neck.

• Worker felt a pop in low back while moving boxes.

• Worker slipped and fell while climbing stairs, bruising both knees

3

AVIATION REPORT

Month/Month % change FYTD % change

June July-June

Passengers 6.6% 6.9%

Concessions Revenue 9.1% 13.6%

Rental Car Revenue 4.1% 3.5%

Parking Revenue 1.5% 3.2% Passengers

Portland International Airport (PDX) finished Fiscal Year 2016/17 with 18.8 million passengers, an increase of 6.9 percent compared to the previous fiscal year. This is the fourth fiscal year of record passenger growth. The airport added 1.2 million more travelers during the timeframe, or on average, 3,300 more passengers per day. International passenger volumes increased 15.7 percent in response to additional capacity and a favorable exchange rate. Even with continued growth, PDX remains second in on-time departure performance year-to-date through May 2017, at 88.77, behind Salt Lake City at 88.88. Concessions Revenue

Combined terminal concessions operations reported a 9.1 percent, or $132,000, rent increase on the month, against a 6.6 percent passenger increase. Similar to prior months’ performances, the rent increase for June is due primarily to 43.6 percent growth in the quick-serve category of food and beverage operations.

0.5

0.7

0.9

1.1

1.3

1.5

1.7

1.9

Jan

Feb

Mar

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Ap

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Jun

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July

Au

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Oct

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Passengers per Month

2015 2016 2017

2017: up 5.7% or +484K passengers

*Domestic: up 5.4% or +441K

*International: up 14.4%

4

Rental Car Revenue

Rental car operations reflect a 3.5 percent, or $672,000, rent increase year-to-date over last year, against a year-to-date passenger increase of 6.9 percent through June. Parking Revenue by Lot

Public parking revenue increased 1.5 percent over June 2016. For Fiscal Year 2016/17, public parking revenue increased 5.0 percent over the previous fiscal year. The economy and valet products had the highest revenue growth, but all products were positive against Fiscal Year 2015/16. Parking transactions decreased 2.6 percent in June, and 2.78 percent in Fiscal Year 2016/17.

Product Revenue Variance YTD Variance

Short-Term $1,564,044 -0.2% 3.1%

Long-Term $1,700,112 2.6% 4.3%

Economy $1,803,351 0.7% 6.5%

Valet $129,120 26.3% 16.5%

Total $5,196,627 1.5% 5.0%

Ground Transportation

June 2017 was another record month for ground transportation with an increase of 38.5 percent, or $446,582, over June 2016. Total estimated fiscal year-to-date revenue is $4,444,761. Transportation Network Company (TNC) revenue contributed $2,538,654. Lyft’s market share continues to rise, coming in at 37.0 percent for June 2017.

Taxi Trips

TNC Pick-ups

Charter Bus

Reservation-Only Trips

Fixed Route Courtesy Total

June 2016 28,705 33,392 128 9,350 2,387 29,351 103,313 Minus

TNC June 2017 21,603 66,907 169 9,621 2,480 30,127 130,907 64,000

-24.7% 100.4% 32.0% 2.9% 3.9% 2.6% 26.7% -8.5% CAPITAL GRANTS

Portland International Airport

Staff submitted a reimbursement request to the Transportation Security Administration (TSA) for the Law Enforcement Officer (LEO) program in the amount of $12,400, covering the May 2017 work period (Agreement No. HSTS0213HSLR647). Staff submitted a reimbursement request to TriMet for the LEO program in the amount of $14,547.57, covering the May 2017 work period (Agreement No. GS150820LG).

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Staff submitted a reimbursement request to the Federal Bureau of Investigation for the Joint Terrorist Task Force program in the amount of $1,065.05, covering the May 2017 work period (Agreement No. 03-026). Staff submitted a reimbursement request to the Federal Aviation Administration (FAA) for the Airport Improvement Program (AIP) – Install Preconditioned Air Units Voluntary Airport Low Emissions project in the amount of $743,153.18 (Agreement No. 03-41-0048-076). Staff submitted a reimbursement request to the FAA for the AIP – Taxiway B Center and Exits Rehab project in the amount of $257,046.78 (Agreement No. 03-41-0048-077). Marine Staff submitted a reimbursement request to the Oregon Department of Transportation (ODOT) for the ConnectOregon VI – Terminal 6 Auto Staging Facility project in the amount of $1,167,761.09 (Agreement No. 31627). Properties

Staff submitted a reimbursement request to ODOT for the Graham/Swigert Road Jobs and Transportation Act project in the amount of $977,950.27, covering the February 2017 through May 2017 work periods (Agreement No. 28368).

MARINE & INDUSTRIAL DEVELOPMENT REPORT

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

June 2017 Fiscal Year-to-Date

Total Tonnage 48.3% 33.4% Containers (TEU) -- -100.0% Import Full Containers -- -- Export Full Containers -- -100.0% Breakbulk -- -88.0% Autos 44.2% 13.4% Mineral Bulk 77.8% 40.2% Grain 10.9% 32.3%

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PROJECT COMPLETION REPORT

The following construction contract, previously awarded by the Commission, has been completed: East Landside Stormwater Enhancement – PDX

Approved by Port Commission March 9, 2016 Contract Award Amount $689,886.00 Approved Change Order Bid Item Adjustments $(189.00) Authorized Change Order Lines $22,139.04 Contract Overruns $2,797.80 Quantity Underruns $(21,919.00) Final Contract Amount $692,714.84 REAL ESTATE TRANSACTIONS EXECUTED PURSUANT TO DELEGATED AUTHORITY Brookstone Stores, Inc. – Fifth Amendment to Retail Concession Lease Location: PDX

Term: Effective June 28, 2017

Use: Amendment No. 5: This amendment extends the term for one additional year. Bambuza South Waterfront, LLC DBA Bambuza Vietnam Kitchen – Second Amendment to Food and Beverage Concession Lease Location: PDX


Use: Amendment No. 2: This amendment replaces the exhibit describing the premises. Metalsmiths Sterling Oregon, Inc., DBA Metalsmiths Sterling – First Amendment to Retail Concession Lease Location: PDX


Use: Amendment No. 1: Amendment replaces the premises lease plat with the final version. SSP America, Inc., DBA Kenny & Zuke's Delicatessen and Market – Second Amendment to Food & Beverage Concession Lease Location: PDX


Use: Amendment No. 2: This amendment adds storage space and clarifies rent commencement provisions.

PD ACC1 LLC – Third Amendment to Ground Lease Location: PDX

Term: June 16, 2017 to May 31, 2027

Use: Amendment No. 3: This amendment extends the term of the lease for an additional two months.

8

Beaches PDX, Inc. – Vehicle Display Information Form - Permit and Right of Entry Location: PDX

Term: June 17, 2017 to October 28, 2017

Use: As required by a Permit and Right of Entry between Beaches, PDX and the Port, Beaches is submitting for Port signature a vehicle display information form for display of motor vehicles within Beaches Restaurant at the airport.

MAJ Airport LLC – First Amendment to Ground Lease Location: PDX


Use: Amendment No. 1: This agreement clarifies and corrects Exhibit H-1, Fuel Storage Tank Agreement form.

Columbia River Estuary Study Taskforce – First Amendment to Permit and Right of Entry Location: Government Island

Term: June 20, 2017 to June 15, 2018

Use: Amendment No. 1: This amendment extends the term for one year. Peninsula Airways, Inc. – First Amendment to Permit and Right of Entry Location: PDX


Use: Amendment No. 1: This amendment amends the term to be extended for one additional year.

Troutdale Associates, LLC – Alta Affidavit, Substitute Form 1099-S, Preliminary Statement Regarding Seller's Exempt Status, Certification of Non-Foreign Status and Seller's Statement to Sale Agreement and Receipt for Earnest Money Location: Troutdale Reynolds Industrial Park (TRIP)

Term: Effective May 31, 2017

Use: Alta Affidavit, Substitute Form 1099-S, Preliminary Statement Regarding Seller's Exempt Status, Certification of Non-Foreign Status and Seller's Statement.

Toyota Motor Sales, U.S.A., Inc. – Permit and Right of Entry Location: Portland

Term: June 01, 2017 to July 31, 2017

Use: Permit for temporary storage of new vehicles. PacifiCorp – Underground Right of Way Easement Location: Cascade Station


Use: The Port is granting PacifiCorp a right of way easement for the purpose of the installation, operation, maintenance and repair of underground electric distribution and communication lines and necessary accessories and appurtenances.

9

CRG Acquisition, LLC – Sale Agreement and Receipt for Earnest Money Location: PacifiCorp property adjacent to TRIP


Use: This agreement will become effective as of the date of Port signatures triggering a five-day period for buyer to pay earnest money and initiating Buyer's due diligence period.

Troutdale Associates, LLC – Access Agreement Location: PacifiCorp property adjacent to TRIP


Use: This access agreement grants the Port access to the site to continue work under the Port's 1200-C Construction Stormwater National Pollutant Discharge Elimination System permit until the new owner obtains its own 1200-C permit.

Vigor Industrial, LLC – Permit and Right of Entry and Reimbursement Agreement Location: Swan Island Industrial Park

Term: June 19, 2017 to June 30, 2017

Use: This permit allows permittee to access areas in and around Berth 315 for the purpose of clearing debris and provide for cost sharing in contemplation of a forthcoming berth use agreement.

Troutdale Associates, LLC – Indemnity and Release Agreement Location: TRIP


Use: Closing documents for TRIP Lots 6,7 and 8 – sale of approximately 74 acres at TRIP for Troutdale Associates, LLC to construct a fulfillment center for Amazon to serve the regional market.

Troutdale Associates, LLC – Regionally Significant Industrial Site Cooperation Agreement Location: TRIP


Use: Agreement for the sale of approximately 74 acres at TRIP for Troutdale Associates, LLC to construct a fulfillment center for Amazon to serve the regional market.

Troutdale Associates, LLC – Special Warranty Deed Location: TRIP


Use: Closing documents for TRIP Lots 6, 7 and 8 – sale of approximately 74 acres at TRIP for Troutdale Associates, LLC to construct a fulfillment center for Amazon to serve the regional market.

Troutdale Associates, LLC – Permit and Right of Entry Location: TRIP


Use: Closing documents for TRIP Lots 6, 7 and 8 – sale of approximately 74 acres at TRIP for Troutdale Associates, LLC to construct a fulfillment center for Amazon to serve the regional market.

Contracts Over $50,000 Pursuant to Delegated Authority

Monthly Report for July 2017 (June Activity)

TitleRequestor

DepartmentVendor Name

P.O. Amount

Purchase wire rope and related supplies.

Navigation Woods Logging Supply

$73,100

Purchase parts and supplies for the deicing treatment system.

PDX Maintenance Hach Company $76,500

Purchase testing equipment for airfield lighting.

PDX Maintenance Malms Navaid, Inc.

$155,480

Obtain consulting services to conduct a Terminal 6 business strategy study.

Properties Advisian, Inc. $225,000

Obtain construction services for maintenance dredging at Terminal 4.

Engineering Project Development

Hickey Marine Enterprises, Inc.

$229,768

Obtain construction services for the Airfield Lighting Emergency Generator Replacement Project.


Quality Plus Services, Inc.

$309,669

Purchase replacement self-contained breathing apparatus equipment.

Public Safety & Security

Sea-Western, Inc.

$400,982

Purchase Microsoft software licensing for 2017-2018.

Information Technology

SHI International Corp

$455,427

New Purchases

APPROVAL LIMITS (Administrative Policy 7.2.3)

All expenditures require management approval:

BUDGET Approval by Directors Up to $ 50,000

APPROVAL Approval by Chief Officers Up to $250,000

Approval by Executive Director & Deputy Executive Director Unlimited

Contracting authority is limited to the following:

CONTRACTING Chief Officers Up to $ 10,000

APPROVAL Buyers Up to $ 50,000

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

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

Obtain construction services for the Terminal 4 Berth Rehabilitation and Site Improvements Project.


Stellar J Corporation

$2,645,790

Obtain construction services for the Airport Way and Frontage Road Rehabilitation Project.


K&E Excavating, Inc.

$2,797,065

TitleRequestor


Original Amount

Previous Changes to

Contract

Current Change to Contract

New Contract Total

Amendment #1 for additional Payment Card Industry Data Security Standard compliance services.


Coalfire Systems, Inc.

$300,000 $56,665 $356,665

Administrative action to provide funding for additional programming of emergency services radios.


City of Portland $148,992 $5,064,025 $97,000 $5,310,017

Various change orders to obtain additional construction services for site improvements at the Troutdale Reynolds Industrial Park.


Goodfellow Brothers, Inc.

$17,441,435 $5,031,653 $892,728 $23,365,816

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 #1010 to obtain a carbon neutrality/offset evaluation.

Environmental AECOM, Inc. $54,936 $54,936 $54,936

Task order against contract #1081 to obtain survey services for the Runway 3-21 Stormwater Infrastructure and Pavement Project.

Engineering Design Services

Otak, Inc. $78,699 $78,699 $237,497

Task order against contract #853 to obtain consulting services for the PDX Terminal Roof Rehabilitation Project.


Professional Roof Consultants, Inc.

$93,553 $93,553 $708,947

Change Orders and Amendments to Project-Specific Contracts

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

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

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.

Task order against contract #660 to purchase low-sulfur diesel fuel for the Dredge Oregon .

Navigation Rainier Petroleum Corporation

$101,808 $101,808 $6,457,533

Task order against contract #1107 for inspection services for the Taxiway B Center and Exits Rehab. Project.


Carlson Testing, Inc.

$125,020 $125,020 $375,020

Task order against contract #660 to purchase low-sulfur diesel fuel for the Dredge Oregon .

Navigation Rainier Petroleum Corporation

$126,880 $126,880 $6,457,533

Task order against contract #867 to obtain construction support services for the Airfield Lighting Emergency Generator Replacement Project.


DBC Architecture, Inc.

$127,120 $127,120 $1,057,268

Task order against contract #1076 for construction inspection services.


Mott MacDonald LLC

$145,760 $145,760 $1,204,249

Task order against contract #1076 for construction inspection services.


Mott MacDonald LLC

$146,527 $146,527 $1,204,249

Task order against contract #1076 to obtain construction coordination and inspection services.


Mott MacDonald LLC

$161,927 $161,927 $1,204,249

Task order against contract #1076 to obtain construction inspection and project control services.


Mott MacDonald LLC

$162,465 $162,465 $1,204,249

Task order against contract #1076 to obtain construction project management and inspection services.


Mott MacDonald LLC

$194,588 $194,588 $1,204,249

Task order against contract #1076 to obtain construction project management and inspection services.


Mott MacDonald LLC

$204,817 $204,817 $1,204,249

Task order against contract #1107 to obtain construction inspection and materials testing services.


Carlson Testing, Inc.

$250,000 $250,000 $375,019

Task order against contract #992 for engineering design services for the Airtrans Way Reconstruction Project.


Century West Engineering Corporation

$283,934 $283,934 $573,663

Port of Portland Operating & Financial Results

FY 2016-17 through June 30, 2017

Preliminary (First Close)

General Fund

Marine

Marine Volumes* Annual

Adopted

Budget

Actual

AmountsVariance

Adopted

Budget

Autos (Units) 309,000 316,818 2.5% 309,000Breakbulk 132,277 7,964 (94.0%) 132,277Containers (TEUs)Grain Bulk 3,527,396 4,600,110 30.4% 3,527,396Mineral Bulk 5,141,179 6,057,290 17.8% 5,141,179

* Volumes in short tons unless otherwise noted.

Industrial Development

Navigation

Current Year to Date

The General Fund includes Marine, Industrial Development, Navigation, General Aviation, Environmental, Financial &

Administrative Services, Executive, Public Affairs, Human Resources, Legal, and Project & Technical Services (IT,

Engineering, and the Project Portfolio Office).

Operating revenues are $29.8M higher than the Revised Budget; the net effect of the timing of land sales and the

ICTSI lease termination settlement. Excluding land sales, operating revenue is $21.0M over budget primarily due to

the terms of ICTSI's termination agreement ($11.5M one time buy out and $8.6M in acquired equipment and

inventory).

YTD operating expenses excluding depreciation are $3.8M lower than the Revised Budget also due to the timing of

land sales. Excluding land sales, operating expenses are $11.6M below budget.

The key variances are listed below:

• Contracts, professional & consulting services expenses ($11.0M < budget).

• Personnel services ($282K < budget).

• Cost of property sold ($7.8M < budget).

• Equipment rental, repair and fuel expenses ($1.2M < budget).

• Travel and management expenses ($856K < budget).

$79

$70

$9

$19

$(9)

$109

$66

$43

$18$24

$(20)

$0

$20

$40

$60

$80

$100

$120

Op Revenue Op Exp Excl

Deprec

OIBD Deprec Op Inc / (Loss)

Millions

General Fund

Curr Mo Budget Curr Mo Actual YTD Budget YTD Actual

$26$22

$4

$9

$(5)

$47

$18

$29

$10

$19

$(10)

$0

$10

$20

$30

$40

$50


Deprec


Millions

Marine


Marine Volumes:

Autos – Auto volumes are 2.5% higher than forecast YTD with volumes YTD being 11.7% higher than last year due to

continued growth in both Hyundai and Honda imports, as well as Ford exports.

Breakbulk – YTD tonnage is 94.0% lower than forecast and 93.6% below last year as there were no ship calls at T 2

until October, with no other activity for the Fiscal Year.

Containers – Until container service resumes, there will be no TEU variances to report.

Grain Bulk – YTD grain volumes are 30.4% higher than forecast and 32.3% higher than last year primarily because

production is up nationally (no drought or disease hurting crops). Also, Columbia River locks closed in December for

maintenance spanning three months, so upriver wheat growers moved their cargo earlier in the year so that it would

not be tied up in their silos for several months.

Mineral Bulk – Tonnage is 17.8% higher than forecast and 38.6% higher than last year. Portland Bulk was offline for

the first two months of last fiscal year during the installation of the new potash shiploader.

YTD operating revenues are $10.5M higher than the Revised Budget due to the timing and portfolio of land sales. The

budget assumed $5.7M in proceeds for the sale TRIP Lots 11 & 12 to BPA in August, as well as $4.9M for the sale of

Daimler parcel 8 in November. Both of those properties are still held for sale. The unbudgeted sale of TRIP Lots 6, 7

& 8 closed in June for $20.1M. $1.2M of Rent Revenues For Tenex and Georgia Pacific have been transferred from

Marine to Industrial Development.

YTD operating expenses excluding depreciation are $7.7M higher than the Revised Budget, with the largest variances

listed below:

• Cost of property sold is $7.8M > budget (Lots 6, 7 & 8 are > $13.4M, Daimler parcel 8 is $884K < budget, TRIP is

$4.4M < budget, Gresham Vista is $303K < budget)

• Contracts, professional & consulting services are $538K < budget due to a credit for a Tidewater barge sublease

($151K; offsets a payment for the Port's lease with DSL that has not yet posted). Remainder primarily from timing

of design review and appraisal, mitigation, and Hayden Island and general environmental expenses.

$32

$24

$9

$1

$8

$43

$31

$12

$1

$11

$(5)

$0

$5

$10

$15

$20

$25

$30

$35

$40

$45

$50


Deprec


Millions

Industrial Development


YTD operating expenses excluding depreciation are $1.3M lower than the Revised Budget due to 28 fewer dredging

days than budgeted (safety stand down delayed the start of the dredging season to late July). Lower operating

expenses translate into lower operating revenues, which are $1.8M < budget.$17

$14

$3$3

$0

$15

$13

$2 $2

$(0)$(2)

$0

$2

$4

$6

$8

$10

$12

$14

$16

$18


Deprec


Millions

Navigation


Marine Operating Results:

YTD operating revenues are $21.0M higher than the Revised Budget mostly due to the terms of ICTSI's lease

termination which included $11.5M one time buy out and $8.6M in acquired equipment and inventory. Marine is

also seeing higher than anticipated grain bulk revenues ($343K > budget) and South Rivergate rail access fees ($807K

> budget; the rail access fees were expected to move to the balance sheet at beginning of FY 16 17). Auto volumes

have increased revenues ($877K > budget). These increases are offset by $1.2M of Lease Revenues budgeted to T 5

(Tenex and Georgia Pacific) which have been transferred from Marine to Industrial Development. YTD operating

expenses excluding depreciation are $4.1M less than budget, with the largest variances listed below:

• Contracts, professional & consulting services are $2.6M < budget due to timing of T 4 and other Marine

environmental expenses ($2.0M) and outside services expenses for waterway/navigation improvements ($252K <

budget; includes contribution for additional stern buoys in the Columbia River and LOADMAX fees). Additional

adjustments to the T 4 environmental expenses will be made later in the annual close process (Retro or Post Audit)

as further analysis of the ROD should reveal appropriate accrual amounts.

• Travel and management expenses are $224K < budget.

• Materials and Supplies expenses are $86K < budget, primarily in the Electrical Maintenance, Crane Shop and

Security business units.

• Insurance expenses are $258K < budget.

• Equipment rental, repair and fuel expenses are $105K < budget.

• Longshore labor is $545K < budget.

Dredging VolumesAnnual

Revised

Budget

Actual

Amounts Variance

Adopted

Budget

Dredging Days 132 104 (21.2%) 132

Cubic Yards Dredged 2,253,891

Current Year-to-Date

Port of Portland Operating & Financial Results

FY 2016-17 through June 30, 2017

Preliminary (First Close)

General Aviation

Support Services

Portland International Airport

Total Passengers

PDX Airline Cost Center (ACC)

PDX Port Cost Center (PCC)

YTD operating revenues are above budget by $199K. The primary driver of this variance is a $300K early termination

fee that the Port received from BHG Hillsboro. Other key drivers include: increased HIO airside rentals (up $213K)

offset by a Hillsboro Master Plan grant that has not been realized (down $405K).

YTD operating expenses before depreciation are over budget by $508K, primarily due to emergency HIO runway

repair excavating costs (up $385K) as well as higher materials and utilities costs. These are offset by lower HIO airfield

consulting and environmental costs.

$4 $4

$(0)

$4

$(4)

$4$4

$(0)

$4

$(4)$(5.0)

$(4.0)

$(3.0)

$(2.0)

$(1.0)

$0.0

$1.0

$2.0

$3.0

$4.0

$5.0


Deprec


Millions

General Aviation


Support Services is comprised of Financial & Administrative Services, Executive, Public Affairs, Human Resources,

Legal, and Project & Technical Services. Costs for these areas are allocated to the operating areas.

YTD operating expenses excluding depreciation are $3.5M under budget, with the largest variances listed below:

• Contracts, professional & consulting services are $2.0M < budget, mostly due to timing of ProMIS

contract/consulting expenses ($1.3M budgeted in Project Portfolio Office business unit; $782K expenses YTD).

Contracts and outside services in HR, IT, Public Affairs, Financial & Administrative Services, and Environmental

Affairs are $1.4M < budget due to timing of expenditures.

• Interdepartmental charges are $434K > budget due to Engineering capitalized labor.

• Travel and management expenses are $538K < budget primarily due to timing of PROPS recognition

program/Achievers contract expenses ($210K budgeted in August but no expenses YTD).

• Personnel Services are $329K < budget.

• Equip Rents & Repair is $166K < budget.

• Other expenses are $430K < budget ($133K < budget in IT software expenses).

YTD ACC revenues are $3.6M higher than budget. Airline revenues are $1.2M higher than budget due to higher than

expected terminal rents (over $650K) and landing activity (over $530K). Retail, food and beverage revenues are

$1.7M higher than budget as a result of higher passenger volume and higher than expected spending per passenger.

YTD ACC expenses are $483K below budget. Personnel Services are $268K under budget due lower than budgeted

fire, police, and administrative costs driven by vacancies. Materials, services, and transfers are $215K under budget,

primarily due to: direct operating materials and supplies (down $108K), direct environmental costs (down $222K),

and maintenance costs (down $368K). These are offset by deicing materials for multiple winter storms (up $1.8M).

Indirect costs included in this variance include: Air Service Development marketing (down $138K), CUP expenses

including heating fuel and consulting services (down $318K), travel expenses/conferences (down $125K), equipment

repair (down $114K), and long range planning consulting (down $75K). Allocated support and interdepartmental

transfers are $904K under budget.

YTD PCC revenues are $4.3M > budget. YTD rental car revenues are $2.6M > budget due to year end MAG

adjustments not yet booked (~$1.6M credit, due to rental car companies, will be booked in 'Retro' close) and

due to June 2016 forecasted accruals being $615K less than actuals invoiced; this amount carried into July.

Passenger volume related activity for July through June account for the remaining $400K increase in rental car

revenues. Other PCC revenues are $2.7M > budget as a result of higher than expected volumes for

transportation network companies (e.g. Uber, Lyft; over $1.7M), additional revenues for SW Development, PDX

GA, and PDX Cargo rent revenues (over $349K), In Flight Meals (over $353K), and overflow ramp parking to the

cargo area (over $262K). This is offset by parking revenues, which are $936K below budget due to multiple flight

cancellations throughout the winter and lower than expected volumes in both the long term and economy

parking lots during the second half of the fiscal year.

PCC expenses are $1.8M < budget. Personnel services expense is $97K under budget. Materials, services, and

transfers are $722K < budget, primarily due to lower direct equipment rentals and repairs ($294K lower) and

direct custodial services ($148K lower). Indirect costs related to this variance include: Air Service Development

marketing (down $115K) and long range planning consulting (down $50K). This is offset by deicing costs for the

roadways (up $168K). Allocated support and interdepartmental transfer expenses are $1.0M under budget.

$132

$84

$47

$1

$136

$84

$48

$5

$0

$20

$40

$60

$80

$100

$120

$140

$160

Revenues Expenses (excl

Deprec)

Debt Service &

Coverage

Surplus / (Deficit)

Millions

PDX ACC

YTD Budget YTD Actuals

$66

$41 $42

$17

$10

$39

$65

$46

$40

$17

$10

$45

$0

$10

$20

$30

$40

$50

$60

$70

Parking

Revenues

Rental Cars

& Other Rev

Expenses

(excl Deprec)

Debt Service

& Coverage

Revenue

Sharing

Income

Millions

PDX PCC

YTD Budget YTD Actual

Passengers traveling through PDX are a key driver of revenues and expenses for the Airport. YTD, over 18.8 million

total passengers have utilized PDX, exceeding the prior year by 6.9%. The higher passenger levels are a result of the

continued growing economy and new flights by air carriers serving PDX. As a result of strong demand for air travel,

PDX passenger levels are increasing as carriers increase seat capacity and add flights.1.01.21.41.61.82.0

Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May JunMillions

FY 15/16 Actual FY 16/17 Actual FY 16/17 Budget

$0

$33

$(33)

$2

$(35)

$0

$30

$(30)

$2

$(31)

$(40)

$(30)

$(20)

$(10)

$0

$10

$20

$30

$40


Deprec


Millions

Support Services


PORT OF PORTLAND

Investment Report

Quarter Ending June 2017

Fiscal 12 Month Moving Average

Yield Comparisons June 2017 Year-to-Date 6/30/17 6/30/16

Port unrestricted portfolio 1.43% 1.20% 1.20% 1.00%

Series 22 construction funds 0.97% 0.77% 0.77% 0.46%

Series 24 construction funds 1.03% 0.97% n/a n/a

Local Gov’t Inv. Pool (LGIP) 1.31% 1.10% 1.10% 0.65%

90 day LIBOR* 1.30% 1.02% 1.02% 0.52%

Investment Portfolio Composition

Unrestricted investments $520,577,000

Unrestricted LGIP 20,318,324

PDX construction bond investments 198,545,000

PDX construction bond LGIP 6,567,366

Total Portfolio $746,007,690

Maturity Schedule Actual Portfolio Policy Minimum

1 year or less $260,571,690 35% none

2 years and under $453,407,690 61% 55%

3 years and under $610,814,690 82% 75%

5 years and under $746,007,690 100% 100%

Unrestricted Series 22 Series 24 Total

Interest Earnings Portfolio Construction Construction Earnings

April 2017 $580,523 $12,957 $168,349 $761,829

May 2017 600,043 12,708 169,405 782,156

June 2017 628,227 11,850 166,565 806,642

Quarter Total $1,808,793 $37,515 $504,319 $2,350,627

Comments

After its meeting on June 14, the Federal Open Market Committee raised the federal funds target rate

25 basis points, marking the second rate increase for 2017. This increase to a range of 1.00% to 1.25%

is on track with the target of two to three rate increases this year. The FOMC meeting also had debate

amongst Committee members when the appropriate time is to start shrinking its balance sheet,

returning its holdings to treasuries only.

The Port’s portfolio yield continues to exceed its benchmarks. The total interest earnings for the

unrestricted portion of the portfolio for Fiscal 16/17 was $5.8 million.

Note: Investment portfolio detail available upon request.

*LIBOR – London Inter Bank Offer Rate (The interest rate that banks charge each other for loans.)

Investments Policy Limits: U.S. Treasuries 100%; U.S. Agencies 100%; Corp. Indebtedness 35%; LGIP $47,390,998 maximum

*Port yield shown excludes amounts on deposit in LGIP and restricted cash balances.

PORT OF PORTLAND

Allocation of non-specific cash and investments available*

As of June 30, 2017, the Port had $239 million in funds available for the General Fund and $320 million available for Portland International Airport. Non-specific balances reflect neither restricted monies such as construction bond proceeds, nor do they reflect debt service funds held by the trustees.

*Allocation is an estimate generated based on preliminary accounting balances at June 30, 2017 and includes investments, LGIP and cash accounts.

executive director’s report to the port of portland … · for fiscal year 2016/17, public...

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