Motion 2019-09 – Airport Dining and Retail Program policy direction Page 1 of 4
MOTION 2019-09:
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A MOTION OF THE PORT OF SEATTLE COMMISSION
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amending prior policy statements of the Port Commission
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regarding street pricing principles for the Airport Dining
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and Retail program at Seattle-Tacoma International
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Airport; implementing an amended pricing policy for the
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Airport Dining and Retail program; and authorizing the
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Executive Director to take such necessary actions to
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implement the amended pricing policy.
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PROPOSED
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JUNE 11, 2019
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INTRODUCTION
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The Port of Seattle Commission has previously passed two motions directing policy for the
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Airport Dining and Retail program (the “ADR Program”) at Seattle-Tacoma International Airport,
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including policy direction with respect to prices charged by ADR Program concessionaires for
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products and services provided at the Airport.
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By motion entitled “Motion of the Port of Seattle Commission Regarding Quality Jobs, Service
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and Employment Continuity Assurances for the Airport Dining and Retail Program,” adopted
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November 25, 2014, the Commission articulated various guiding principles for operation of the
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ADR Program, including one principle calling for “continuation of ‘street pricing’ of products
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and services.”
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Subsequently, by motion reflected in Port Commission Meeting Minutes dated November 24,
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2015, Item 6.d, the Commission approved a temporary, conditional policy to authorize “street”
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pricing plus up to ten percent (10%), with subsequent steps down year by year, to return to
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strict street pricing effective January 1, 2020.
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This motion revises the street pricing principle in the motion adopted on November 25, 2014,
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repeals the temporary street pricing policy authorized by the motion adopted November 24,
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2015, and establishes an amended pricing policy allowing ADR Program concessionaires to
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charge street pricing plus a maximum of ten percent.
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Item Number: 8a_motion
Meeting Date: June 11, 2019
Motion 2019-09 – Airport Dining and Retail Program policy direction Page 2 of 4
TEXT OF THE MOTION
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(1) The Commission hereby amends the principles of ADR Program redevelopment within
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the Statement of Policy Direction section of the Commission motion adopted November
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25, 2014, to delete, in its entirety, the following principle:
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5. Continuation of ‘street pricing’ of products and services
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(2) The Commission hereby repeals, effective January 1, 2020, the temporary street pricing
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policy established by the Commission motion adopted November 24, 2015 (Port
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Commission Meeting Minutes dated November 24, 2015, Item 6.d).
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(3) Amended Pricing Policy for ADR Concessionaires.
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(a) The Commission hereby adopts and authorizes the Executive Director to implement
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an amended street pricing policy to allow concessionaires in the ADR Program to set
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prices at not more than ten percent (10%) above “street” prices for all products and
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services sold at the Airport (“Amended ADR Pricing Policy”); provided, that this
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Amended ADR Pricing Policy will only be extended to concessionaires if they offer:
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1. Wages equal to or exceeding the minimum wage standards set forth in Chapter
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7.45 of the City of SeaTac Municipal Code;
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2. Payment of sick and safe time, which shall be accrued at the rate of one hour for
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every 40 hours worked;
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3. Health insurance to full-time employees, consistent with the Affordable Care
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Act; and
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4. Comply with any reasonable request from Port staff for verification of actual
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wages paid to the tenant's employees.
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The above requirements (1.) through (4.) may be waived for employers with a bona
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fide collective bargaining agreement.
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(b) The Executive Director is directed to begin implementation of this Amended ADR
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Pricing Policy, including review and processing of ADR Program concessionaire
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requests for approval of price adjustments based on the Amended ADR Pricing
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Policy.
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1. Beginning on January 1, 2020, eligible ADR Program concessionaires may charge
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approved street pricing plus up to a maximum of ten percent (10%) under this
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Amended ADR Pricing Policy.
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Motion 2019-09 – Airport Dining and Retail Program policy direction Page 3 of 4
2. Until January 1, 2020, concessionaires shall continue to adhere to the current
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street pricing policy established by the Commission motion adopted November
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24, 2015 (Port Commission Meeting Minutes dated November 24, 2015, Item
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6.d). Concessionaires who do not satisfy requirements (1.) through (4.)
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identified in paragraph (a) above, as verified by the Port, shall be limited to
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charging strict street pricing for their products and services commencing January
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1, 2020.
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(c) The Executive Director is further authorized to take all such actions as necessary to
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implement the Amended ADR Pricing Policy described herein, including:
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1. Development of (or adjustment to) procedures for review and confirmation of
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proposed concessionaire pricing;
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2. Revision to operational policies and procedure relating to pricing requirements
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for ADR Program concessionaires;
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3. Preparation and execution of necessary lease amendments, addenda and/or
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other documentation necessary to approve pricing of ADR Program
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concessionaire products and services and adherence to the Amended ADR
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Pricing Policy.
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STATEMENT IN SUPPORT OF THE MOTION
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In taking this action the Commission intends to support the Executive Director’s
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recommendation to establish an amended policy to allow ADR Program concessionaires to
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charge street pricing plus up to 10 percent (10%) for products and services offered at the
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Airport. The Commission and staff have heard from large prime operators as well as small, local
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and minority-owned concessionaires who have expressed concern regarding the increased cost
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of doing business at the Airport and the impact of those higher costs on their ability to operate
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viable businesses.
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These cost pressures are evident in the building out and refurbishing their units, the wages and
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benefits paid to their employees and the services that are necessary to operate their businesses
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at the Airport (for example, security badging, parking, common area maintenance fees, unified
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pest management, trash recycling, and adherence to Commission Resolution No. 3725).
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Higher costs in these areas, together with the scheduled return to required strict street pricing
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in January 2020, has decreased the interest of new firms in bidding for leasing opportunities at
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the Airport and has led several current concessionaires to express concerns about their ability
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to operate profitable businesses.
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The Commission recognizes that circumstances at the Airport will continue to evolve and
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flexibility may be necessary to reach our mutual goals of excellent customer service and
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Motion 2019-09 – Airport Dining and Retail Program policy direction Page 4 of 4
attractive dining options. However, by this motion, and consistent with these goals, allowing
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street plus 10% pricing provides concessionaires with an enhanced ability to recover their
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higher costs, improves the opportunity for concessionaires to procure quality products and staff
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resources, and will likely increase the number and variety of small-business and other
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proposers for future concessions opportunities at the Airport.
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