1. PORT OF TACOMA

2. Request Authorization for CEO to enter into an Agreement between the Port of Tacoma, Horizon Lines and APM Terminals consistent with the term sheet PORT OF TACOMA, HORIZON LINES, and APM TERMINALS AGREEMENT Presented by Curt Stoner Action Requested of Commission

3. PORT OF TACOMA Background In 2009, Horizon Lines requested proposals for PNW marine terminal services based on Horizon contract with APM Terminals expiring in December, 2010 In December, 2009 the Port made a proposal to Horizon Lines Proposal terms:  Contribution of up to $2 million in facility improvements at any Port marine terminal at which Horizon would operate for a minimum of 5 years

4. PORT OF TACOMA Background— cont’d. On February 24, 2010 Horizon announced that they had chosen to remain at APM Terminals Horizon commitment to APM Terminals is 6 years with one 2-year extension option Both the Horizon Alaska service and Hawaii PEX service are expected to call at APM Terminals during this period Estimated 150 direct terminal-related jobs will remain in Tacoma

5. PORT OF TACOMA Summary of Agreement (Term Sheet) 1.Port will contribute to actual cost of facility improvements in an amount not to exceed $2 million (photos following)

6. PORT OF TACOMA Transload Area

7. PORT OF TACOMA Transload Area

8. PORT OF TACOMA HVAC

9. PORT OF TACOMA Office Remodel

10. PORT OF TACOMA Office Remodel

11. PORT OF TACOMA Dock Plates

12. PORT OF TACOMA Summary of Agreement (Term Sheet) cont’d. 2.Port will undertake best efforts to accomplish as much work as possible within 18 months of signing 3.Port would work with Horizon and APM Terminals to expeditiously accomplish identified improvements upon confirmation that Horizon has agreed to a minimum 5-year agreement with APMT, including the twice weekly AK service and once weekly PEX service

13. PORT OF TACOMA Summary of Agreement (Term Sheet) cont’d. 4.No changes in existing maintenance responsibilities 5.Horizon guarantees intermodal rail volume minimum of 2,750 intermodal lifts per year 6.Horizon will actively participate in Port’s Truck Emissions Improvement Program 7.APM Terminals agreements to support Truck Emissions Reduction Program and also agrees to facility improvements and methodology of improvement management

14. PORT OF TACOMA Financial Impact No less than 75% of the $2 million in facility improvements is expected to be capitalized No expense items are anticipated for 2010 Commission approval will be requested for all significant contract awards

15. PORT OF TACOMA Request Authorization for CEO to enter into an Agreement between the Port of Tacoma, Horizon Lines and APM Terminals consistent with the term sheet PORT OF TACOMA, HORIZON LINES, and APM TERMINALS AGREEMENT Action Requested of Commission

16. PORT OF TACOMA H:\ContainerLOB\Stoner\2010\Presentations\Comm_Hrz_062410.ppt