PORT OF SEATTLE

MEMORANDUM

DATE: September 19, 2011

SUBJECT: Airline Realignment: Tenant Improvements and Ticket Counter Design Services

IDIQ for Seattle-Tacoma International Airport

Amount of This Request: $0 Source of Funds: Current and Future Operating Budgets;

Future Individual Project Authorizations

Maximum Value of IDIQ Contract: $10,000,000

ACTION REQUESTED:

SYNOPSIS:

Over the next few years, significant space changes are in store for the Airport, due to the airline

realignment. The total cost of these changes could total approximately $150M. The airlines

have recently requested that the Port of Seattle take over and complete design and construction

of airline tenant improvements as part of the Airline Realignment. Further as a means to avoid

the high cost of terminal building expansion, the Port of Seattle is working with airlines to

develop new ticket lobby arrangements in the south end of the Main Terminal. These

arrangements can include new ticketing and baggage drop locations at the west window wall,

relocated ticket counters “pushed back” to the east for more lobby space, “flow through”

ticketing, and associated airline office relocations. This IDIQ contract would be used for

COMMISSION AGENDA

Tay Yoshitani, Chief Executive Officer

September 19, 2011

Page 2 of 5

amount. Competitively bid IDIQ contracts are a widely used public sector contracting tool,

consistent with the Port’s Resolution No. 3605, as amended, and governed by CPO-1 policy.

BACKGROUND:

procurement process.

The airline realignment is driven by airline mergers and the consolidation needs of Alaska

Airlines which necessitates the repositioning of gates, holdrooms, and ticketing positions

throughout the Airport. The Airline Realignment program consists of capital improvement

projects (CIPs) required to relocate the subject airlines. In addition, Tenant Improvement (TI)

work, i.e., the design and construction of airline ticket counters, offices, and gate areas, is

required for the operational moves. Previously, the airlines considered executing all TI work

themselves with tenant reimbursement agreements. The airlines are now requesting that the Port

complete a substantial portion of the airline TI work. The work consists of design and

areas by reallocating space to fit passenger needs. A recent example elsewhere in the terminal

was Alaska Airlines’ Two-Step ticketing and baggage drop modifications, including flow-

through ticket counters. Aviation Planning, with the assistance of the Terminal Development

Strategy Planning consultant, is examining modifications to the south end ticket counters. Delta

Air Lines, a major tenant in this area, obtained concept approval from the Port to construct a new

flow-through ticketing layout. Delta has now requested that the Port construct this flow-through

ticketing arrangement. Furthermore, the Port is pursuing development of additional ticketing

along the window wall and either flow-through or pushed-back ticketing at other ticket counter

locations.

work identified in particular service directive(s). Service Directives may be issued during the

COMMISSION AGENDA

Tay Yoshitani, Chief Executive Officer

September 19, 2011

Page 3 of 5

Contract Ordering Period. The Port will not issue Service Directives in excess of the

$10,000,000 contract value.

Port staff recommends having only one consultant team for this work in order to avoid different

design teams designing for overlapping locations; to maximize efficiency and minimize costs

provided by the consultant for each project.

This authorization will only authorize the execution of the contract. Service Directive will be

issued following authorization of the project and budget in accordance with Port policies and

procedures.

PROJECT SCOPE OF WORK AND SCHEDULE:

Prepare one contract for Airline Realignment Tenant Improvements & Ticket Counter Design

Service for the Airport. This will include program definition and comprehensive design work for

 Airline Realignment Tenant Improvements: This component is in support of the Airline

Realignment.

 South End Ticket Counter Modifications: This component will gain efficiencies through

The total estimated cost for design services will not exceed $10,000,000. The contract will have

a not-to-exceed dollar threshold. No work is guaranteed to the consultants, and the Port is not

obligated to pay the consultant until a Service Directive is executed. After receiving

Commission authorization for each project in accordance with Resolution 3605, the actual work

will be defined and the Port will issue individual project-specific Service Directives.

ENVIRONMENTAL SUSTAINABILITY/COMMUNITY BENEFITS:

Each project will identify environmental sustainability and community benefits as part of its

COMMISSION AGENDA

Tay Yoshitani, Chief Executive Officer

September 19, 2011

Page 4 of 5

Each project will identify a triple bottom line summary as part of its Resolution No. 3605, as

amended, authorization.

ALTERNATIVES CONSIDERED/RECOMMENDED ACTION:

Alternative 2 - Prepare separate procurements for each project. This alternative would require

many more procurement processes, add more time to projects, and increase administrative costs

in order to hire consultant design teams for each project. Project integration would be more

difficult to achieve. This is not the recommended alternative.

Alternative 3 – Do nothing. –Each airline designs and constructs its own tenant improvements.

This will result in more coordination required, more cost, and will be more difficult to manage

and schedule. The airlines do not support this alternative. This is not the recommended

alternative.

PREVIOUS COMMISSION ACTION:

On September 12, the Port Commission was briefed by staff on the Airline Realignment

program.

On June 14, 2011, the Port Commission authorized 1) design of the Airport Signage – Airline

Realignment project at Seattle-Tacoma International Airport (Airport). This authorization is for

$238,000 of a total project cost of $646,000, and 2) execution of a professional services

Indefinite Delivery Indefinite Quantity contract for signage design services totaling $400,000 for

four (4) years in support of upcoming capital improvement projects, including the Airport

Signage Airline Realignment project at the Airport (CIP #C800474).

On June 14, 2011, the Port Commission authorized Exterior Gate Improvements – Airline

Replacement /TC3 Replacement (C800382) in the amount of $1,731,000.

COMMISSION AGENDA

Tay Yoshitani, Chief Executive Officer

September 19, 2011

Page 5 of 5

On February 22, 2011, the Port Commission authorized design and some construction for the

Passenger Loading Bridge Replacement Project - Airline Realignment (C800467) in the amount

of $6,700,000.

On June 8, 2010, the Port Commission authorized execution of an IDIQ contract for the

Terminal Development Strategy Campus Planning Services IDIQ in the amount of $1,300,000.