Template revised September 22, 2016.
COMMISSION
AGENDA MEMORANDUM
Item No.
6c
ACTION ITEM
Date of Meeting
January 9, 2018
DATE: December 31, 2017
TO: Dave Soike, Interim Executive Director
FROM: Michael Ehl, Director Airport Operations
Wayne Grotheer, Director Aviation Project Management Group
SUBJECT: Zone 3 Common Use Ticket Counter Conversion Project (CIP #C800925)
Amount of this request:
$1,650,000
Total estimated project cost:
$1,700,000
ACTION REQUESTED
Request a single Commission authorization for the Executive Director to: (1) proceed with
design and construction of the Zone 3 Common Use Ticket Counter project at Seattle-Tacoma
International Airport; (2) execute a contract to purchase common use equipment; and (3) use
Port crews to complete the project. This single authorization is for a total cost of $1,700,000.
EXECUTIVE SUMMARY
This project responds to the continued growth in Airport traffic and airline operations. It
improves the efficiency and flexibility of the ticket lobby, and thus improves the passenger
experience at the Airport. This project is necessary to provide additional common use ticket
counters for new airline entrants that have announced the start of service to Seattle beginning
the summer of 2018. There is currently not enough capacity at the current common use ticket
counters to accommodate these new airlines as these counters are fully subscribed at peak
times.
The project adds common use ticketing capacity in the Zone 3 Ticket Lobby between Delta Air
Lines and Southwest Airlines creating 10 new common use ticket counter positions. It also adds
8 Common Use Self Service (CUSS) kiosks in the lobby area. Zone 3 is located adjacent to the
passenger security checkpoint that provides the most direct access to international departure
gates. Virgin America, Inc., through the merger with Alaska Airlines, will be vacating the space
in April 2018.
This single authorization request will allow the project team to proceed quickly as this project
has been deemed a “hot project.” Airline operations are impacted by the current lack of ticket
counter capacity that this project will address.
COMMISSION AGENDA – Action Item No. _6c___ Page 2 of 4
Meeting Date: January 9, 2018
Template revised September 22, 2016; format updates October 19, 2016.
JUSTIFICATION
This project supports the Century Agenda Goal to advance this region as a leading tourism
destination and business gateway: make Sea-Tac Airport the West Coast “Gateway of Choice”
for international travel and double the number of international flights and destinations.
DETAILS
This project will add common use ticketing capacity in the Zone 3 Ticket Lobby between Delta
Air Lines and Southwest Airlines creating 10 new common use ticket counter positions. It also
adds up to 8 Common Use Self Service (CUSS) kiosks in the lobby area. Total project costs are
estimated to be $1,700,000. Recurring hardware license and maintenance costs will be
budgeted within the Aviation Maintenance department’s operating budget.
Scope of Work
This project adds ticketing capacity in Zone 3 by creating 10 new common use ticket counter
positions and adding 8 CUSS kiosks.
(1) Repurpose 6 existing Virgin America ticket counter positions for common use
(2) Add 4 ticket counter positions in Zone 3
(3) Add 6 new bag scales to replace previous proprietary scales
(4) Purchase and install Common Use (CUSE) ticket counter equipment, including bag scales
and overhead display monitors required for 10 positions
(5) Purchase and install 8 Common Use Self Service (CUSS) kiosks
Schedule
Activity
Design start
2018 Quarter 1
Construction start
2018 Quarter 1
In-use date
2018 Quarter 3
This Request
Total Project
Design
$276,000
$276,000
Procurement
$722,000
$722,000
Construction
$701,000
$701,000
Total
$1,700,000
$1,700,000
ALTERNATIVES AND IMPLICATIONS CONSIDERED
Alternative 1 – Lease the vacated Virgin America ticket counters to another airline
Cost Implications: $0
Pros:
(1) This is the least expensive option.
COMMISSION AGENDA – Action Item No. _6c___ Page 3 of 4
Meeting Date: January 9, 2018
Template revised September 22, 2016; format updates October 19, 2016.
Cons:
(1) This option does not provide the common use capacity needed to support new
entrant carriers.
This is not the recommended alternative.
Alternative 2 – Replicate the adjacent Delta Air Lines flow-through ticket counter “islands” by
building out a third check-in island as a Port sponsored capital project using the vacated Virgin
America ticket counters along with the next door vacant former airline ticket office space to
create 17 flow-through passenger check-in positions (8 common use positions, 9 common use
kiosks).
Cost Implications: $4,300,000
Pros:
(1) Additional common use check-in counters for new entrants would be established.
(2) Passenger queueing and circulation in Zone 3 would see improvement.
Cons:
(1) This alternative will not meet the timeline required for new entrants in summer of
2018.
(2) This alternative would cost more than Alternative 3.
This is not the recommended alternative.
Alternative 3 –Convert Virgin America’s existing check-in counters to 10 common use positions.
Purchase and install 8 CUSS kiosks.
Cost Implications: $1,700,000
Pros:
(1) Allows flexibility with 10 common use positions which can be configured to meet
airline needs on-demand.
(2) Can be constructed to meet summer deadline for new entrant carriers.
Cons:
(1) Location of construction area will have some impact on Delta operations; will require
coordination with Delta to mitigate impacts.
This is the recommended alternative.
FINANCIAL IMPLICATIONS
Cost Estimate/Authorization Summary
Capital
Expense
Total
COST ESTIMATE
Original estimate
$1,700,000
$0
$1,700,000
AUTHORIZATION
COMMISSION AGENDA – Action Item No. _6c___ Page 4 of 4
Meeting Date: January 9, 2018
Template revised September 22, 2016; format updates October 19, 2016.
Previous authorizations
$50,000
$0
$50,000
Current request for authorization
$1,650,000
$0
$1,650,000
Total authorizations, including this request
$1,700,000
$0
$1,700,000
Remaining amount to be authorized
$0
$0
$0
Annual Budget Status and Source of Funds
The Zone 3 Common Use Ticket Counter Conversion (CIP# C800925) was not included in the
2018-2022 capital budget and plan of Finance. The budget was transferred from the
Aeronautical Allowance (CIP #C800753), resulting in no net change to the capital budget. The
funding source for this project will be future revenue bonds.
Financial Analysis and Summary
Project cost for analysis
$1,700,000
Business Unit (BU)
Terminal Building
Effect on business performance
(NOI after depreciation)
NOI after depreciation will increase
IRR/NPV (if relevant)
N/A
CPE Impact
Less than $0.01 in 2018
Future Revenues and Expenses (Total cost of ownership)
The space will continue to be used as ticket counter space. The capital cost of this project will
be incorporated into the airline rate base and recovered through terminal rents and common
use fees.
ATTACHMENTS TO THIS REQUEST
Presentation slides
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS
None