Template revised January 10, 2019.
COMMISSION
AGENDA MEMORANDUM
Item No.
8d
ACTION ITEM
Date of Meeting
December 12, 2023
DATE: December 1, 2023
TO: Stephen P. Metruck, Executive Director
FROM: Laurel Dunphy, Director Airport Operations
Krista Sadler, Director ICT Technology Delivery
SUBJECT: Surface Area Management Project Additional Authorizations (CIP #800650)
Amount of this request:
$2,494,000
Total estimated project cost:
$15,865,000
ACTION REQUESTED
Request Commission authorization for the Executive Director to (1) advertise and execute a
major public works contract to construct portions of the Surface Area Management System
project at Seattle-Tacoma International Airport; (2) amend the contract with SAAB, Inc. to
increase the contract value up to $512,000 for additional services and equipment; (3) increase
the project budget by $2,494,000 for a new total of $15,865,000; and (4) execute a Project Labor
Agreement.
EXECUTIVE SUMMARY
The Surface Area Management (SAM) project, first authorized in June 2019, has implemented a
system to improve airfield situational awareness and provide forensic and analytic information
on airfield operations at Seattle-Tacoma International Airport (SEA). The system provides
information to improve aircraft flow and gate docking efficiencies, reduce aircraft holds, and
support safety initiatives by providing more detailed information on incident causes and
contributing factors. Integrating with several Port and external data feeds, the system provides
a real-time, actionable picture of operations that is invaluable to Airport Operations, emergency
response, security, and our airline partners.
The system is being implemented in multiple phases and portions are now used by Port staff,
Federal Aviation Administration (FAA), and Airlines. The first three phases deployed the core
system, video analytics capabilities, integration with other Port systems, and vehicle and
equipment tracking. In parallel to the delivery of these phases, the project team progressed the
design work for phase four, the installation of sensors and cameras used by the new system to
provide more detailed situational awareness on the airfield. In February 2022, Commission
authorized construction using Job Order Contracting (JOC) to complete construction. While the
installation of critical sensors has proceeded using this contracting method, staff is now
COMMISSION AGENDA – Action Item No. 8d Page 2 of 5
Meeting Date: December 12, 2023
Template revised June 27, 2019 (Diversity in Contracting).
recommending that remaining sensors and cameras be delivered via a major public works
contract.
Schedule delays to the design of the fourth phase of the project and the recommended change
in contracting method have resulted in increased project costs estimated at $2,494,000. Finally,
an amendment to the contract with the project system vendor, SAAB, Inc. will provide additional
contract capacity to provide additional sensors and equipment necessary to complete the
system.
JUSTIFICATION
The SAM system provides a holistic view or understanding of underlying reasons or root causes
for delays, bottlenecks, or deficiencies and improve overall airfield efficiency at the Airport.
Additional funding through this request will allow the system to be constructed as designed
providing the greatest opportunity to provide this holistic view.
Diversity in Contracting
The project team has worked with the Diversity in Contracting Department to establish a 10%
women- and minority-owned business enterprise (WMBE) aspirational goal for this construction
contract.
DETAILS
Since 2022 the project has encountered delays due to extensive site investigations during design
and efforts to value engineer alternative locations, additional compliance measures identified
later in the process and the resulting added design effort. These delays have resulted in additional
staff costs and other soft costs. As design neared completion, it was determined that the JOC
construction method approach initially planned for the entire project was no longer suitable for
that entire scope. The JOC construction method utilizes established fixed period indefinite
quantity indefinite delivery public works contracts to complete work in work orders of limited
size. They often prove most useful for smaller scopes of work or repetitive construction of similar
scopes of work.
While a useful tool under the right circumstances, JOC contracting has limitations that would
have extended the delivery time for this project even further, and subsequently increased costs
due to the longer delivery process. As the project team considered alternative delivery methods
to complete construction, a need for more immediate installation of key sensors to address a
critical shortfall of airfield awareness led the team to proceed with the construction of these
critical sensors using the JOC method, while separating out the balance of the work to be
delivered via a more traditional major works construction bid package. While this reduced the
time taken to provide these critical sensors, it resulted in two construction packages and
additional costs to manage both.
Lessons learned because of the challenges this project has faced include:
COMMISSION AGENDA – Action Item No. 8d Page 3 of 5
Meeting Date: December 12, 2023
Template revised June 27, 2019 (Diversity in Contracting).
(1) Recognition that technology projects often lead to a more iterative and therefore lengthy
design phase for the physical installation. Often technology projects incorporate
emerging technologies that do not have historical practices on which to base a design
schedule and budget.
(2) Early collaboration among departments delivering technology projects to better scope
the physical infrastructure requirements for such shared projects will allow for improved
budgeting and scheduling of these unique projects.
(3) Better understanding of the benefits and limitations of the utilization of JOC contracts at
the Port will allow for a more informed decision when the Project Delivery Method is
selected. The Port is limited in the number of JOC contracts it can utilize, and broad use
of the JOC contract for other projects at the Port limited the contracting capacity available
for this project.
Scope of Work
The Phase 4 project scope of work includes sensor and camera installation at various locations in
the airfield to improve identification of targets for situational awareness and provide gate turn
monitoring at all gates. The scope also includes the setup of the all the required Power and
Communication Infrastructure for the sensors and cameras.
Schedule
Activity
Construction (Phase 4)
In-use date
Cost Breakdown
This Request
Total Project
Capital
Hardware/Software/Vendor Services
$3,283,000
Port Labor
$649,000
Sensor/Camera Installation
$11,533,000
Total Capital
$15,465,000
Expense
Training
$200,000
Spare Parts
$200,000
Total Expense
$400,000
TOTAL PROJECT
$15,865,000
ALTERNATIVES AND IMPLICATIONS CONSIDERED
An alternative that would have provided three additional sensors adjacent to Runway 16R-34L
was considered which would have increased the project cost by a further estimated $400,000 in
COMMISSION AGENDA – Action Item No. 8d Page 4 of 5
Meeting Date: December 12, 2023
Template revised June 27, 2019 (Diversity in Contracting).
both direct and soft costs; however, it was deemed infeasible and not pursued due to the time
required to seek and reach all required federal and local approvals.
Alternative 1 – Reduce project scope to remain within existing project budget.
Cost Implications: $0 additional cost
Pros:
(1) Project remains within existing project budget.
Cons:
(1) Resulting system is deficient and will not meet project goals and requirements.
(2) Reduction of the system as designed would require additional time to revise the system
and infrastructure design, which will delay system activation and in turn the productive
use of the full capabilities of the system.
This is not the recommended alternative.
Alternative 2 – Increase project funding to meet current scope.
Cost Implications: $2,494,000 additional cost
Pros:
(1) Resulting system meets project goals and requirements.
(2) No delay in construction would be experienced as there would be no need to wait for
the redesign to the reduced scope.
Cons:
(1) Project would cost more than Alternative 1
This is the recommended alternative.
FINANCIAL IMPLICATIONS
Cost Estimate/Authorization Summary
Capital
Expense
Total
COST ESTIMATE
Original estimate
$6,200,000
$400,000
$6,600,000
Previous changes – net
$6,771,000
$0
$6,771,000
Current change
$2,494,000
$0
$2,494,000
Revised estimate
$15,465,000
$400,000
$15,865,000
AUTHORIZATION
Previous authorizations
$12,971,000
$400,000
$13,371,000
Current request for authorization
$2,494,000
$0
$2,494,000
Total authorizations, including this request
$15,465,000
$400,000
$15,865,000
Remaining amount to be authorized
$0
$0
$0
COMMISSION AGENDA – Action Item No. 8d Page 5 of 5
Meeting Date: December 12, 2023
Template revised June 27, 2019 (Diversity in Contracting).
Annual Budget Status and Source of Funds
This project, C800650 was included in the 2023-2027 capital budget and plan of finance for
$13,100,000. The capital budget increase of $2,494,000 will be transferred from the Aeronautical
Allowance C800753 resulting in no net change to the Aviation Division capital budget. The
funding source would be the Airport Development Fund and revenue bonds. This project had
prior airlines Majority in Interest (MII) approval of $5M. The budget increase would utilize the
MII Management Reserve which would not require additional MII approval.
Financial Analysis and Summary
Project cost for analysis
$15,865,000
Business Unit (BU)
Airfield Movement Area
Effect on business performance
(NOI after depreciation)
NOI after depreciation will increase due to inclusion of
capital (and operating) costs in airline rate base
IRR/NPV (if relevant)
N/A
CPE Impact
$0.07 in 2026
Future Revenues and Expenses (Total cost of ownership)
Previously authorized annual recurring maintenance and license costs for this system,
estimated at $1,620,000 are budgeted in the Aviation Operations and Aviation Maintenance
operating budgets.
ADDITIONAL BACKGROUND
Since the deployment of phase 1 of the project, the Port and its partners have realized several
benefits from using the new system.
(1) Alaska Airlines leveraged information from the new system and implemented a change to
its operations that that resulted in reduction of wait time for gates upon arrival.
(2) Ramp Tower and FAA coordination significantly improved coordination during impacts of
the 2021 Airport Improvement Project (AIP) work and International Arrivals Facility (IAF)
construction taxi lane closures
(3) Sixty-seven (67) gates are currently under turn monitoring surveillance providing time
stamps of up to 36 critical milestones throughout the progression of a turn which
establishes a record to gauge vendor performance and predict off-block times.
ATTACHMENTS TO THIS REQUEST
(1) Presentation slides
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS
February 8, 2022 – The Commission authorized construction using JOC, a budget increase and
a contract amendment with the vendor SAAB, Inc.
June 11, 2019 –The Commission authorized proceeding with the project for $4,782,000.