Template revised January 10, 2019.
COMMISSION
AGENDA MEMORANDUM
Item No.
8i
ACTION ITEM
Date of Meeting
January 9, 2024
DATE: December 28, 2023
TO: Stephen P. Metruck, Executive Director
FROM: Rick Duncan, Director Airline Affairs & Aviation Properties 
Eileen Francisco, Director, Aviation Project Management Group 
SUBJECT: Post IAF Airline Realignment - Additional Construction Authorization (CIP #C801158)
Amount of this request:
$7.5 Million
Total estimated project cost:
$102 – $140 Million
ACTION REQUESTED
Request Commission authorization for the Executive Director to increase the project
authorization by $7,500,000 to advance the project schedule for the Post IAF Airline Realignment
project at Seattle-Tacoma International Airport. The range of the total estimated cost of this
project is $102,000,000 to $140,000,000.
EXECUTIVE SUMMARY
The project is facilitating the relocation of United Airlines’ (UA) domestic only operations space
from Concourse A to Concourse B. In September the Commission tasked the project team with
investigating and bringing forward opportunities to advance the project schedule or mitigate risk
of delay in 2025 project delivery.
This request authorizes funding for temporary facilities and infrastructure that improve the
sequencing of construction activities and allow critical work to begin earlier. These include self-
contained mobile trailers for temporary tenant relocations and temporary mechanical services
to provide supplemental conditioned air to expanded Concourse B office support space ahead of
final mechanical upgrades.
In addition, this authorization provides flexibility to execute purchases for long lead critical
materials that could negatively impact schedule. Currently some projects are experiencing
volatility in the lead times of key infrastructure components such as electrical and mechanical
equipment. Having this authorization will provide the ability to act quickly to purchase these long
lead items once they have been identified.
COMMISSION AGENDA – Action Item No. 8i Page 2 of 7
Meeting Date: January 9, 2024
Template revised June 27, 2019 (Diversity in Contracting).
JUSTIFICATION
The temporary provisions identified by the project team help mitigate delays to project delivery
in 2025 and support the Port’s overall airline realignment criteria and future gate allocation by
advancing the relocation of airlines as planned.  Funds authorized with this action allow the
General Contractor Construction Manager (GCCM) to implement schedule risk mitigation that
improve construction sequencing or facilitate work beginning earlier, providing the project team
opportunity to maintain or improve the construction schedule. In addition, this authorization
allows the project team to act quickly during the design phase to execute procurements early
when system components could impact schedule due to long lead time.
Diversity in Contracting
The project team has worked with the Diversity in Contracting team to establish the following
women- and minority-owned business enterprise (WMBE) goals for the project’s contracts as
outlined in the table below.
Contract
Goal
PM
14%
CM
30%
Design
15%
GCCM (Construction)
13%
DETAILS
In September, the Commission tasked the project team to investigate and identify opportunities
for consideration that allow for improved construction sequencing and provide mitigation to
reduce risks identified within the current construction schedule. The funding authorized by this
action will allow the project team to act on the following scope additions, temporary construction
provisions, early procurements and cost increases identified since the September authorization.
Collectively, these components support or provide opportunities to improve project delivery.
Scope of Work
(1) Self-contained trailers to facilitate intermediate office and ramp operations support
space for tenants that must be relocated from Concourse B to make way for necessary
construction improvements required to facilitate airline relocations and meet the 2025
completion date.
(2) Supplemental conditioned air provided through temporary air handling units to improve
the critical path schedule by allowing the Concourse B ramp office and support spaces
to be occupied ahead of final mechanical upgrades.
(3) Design support to develop design documents and construction funds to facilitate early
procurement for components with long-lead material delivery durations identified in
coordination with the General Contractor/Construction Manager and design team.
COMMISSION AGENDA – Action Item No. 8i Page 3 of 7
Meeting Date: January 9, 2024
Template revised June 27, 2019 (Diversity in Contracting).
(4) Higher cost for the Enabling Work Package 1 scope based on current market conditions
realized when public bids were received on 11.30.23.
Schedule
To facilitate the complex phased delivery of the project, a portion of work was identified, and the
design accelerated to allow the contractor to begin initial work as the base program design
continued development. The base program work will begin in Quarter 1 2024, after the first
phase of enabling work has been completed and makes the space available. The temporary
provisions outlined within provide opportunities to improve the construction sequencing of the
critical path schedule, as well as mitigate risk for schedule delays during construction.
Implementing these temporary measures now, with the accelerated enabling work authorized in
September, will support the project team’s continued efforts to improve schedule milestones.
Activity
Enabling Work Construction Start
2024 Quarter 1
Base Program Construction Authorization
2024 Quarter 2
Base Program Construction Start
2024 Quarter 2
United Airlines Lounge Construction Authorization*
2024 Quarter 4
United Airlines Lounge Construction Start*
2024 Quarter 4
In-use date (Concourse B)
2025 Quarter 4
In-use date (Concourse A)
2026 Quarter 1
* This scope is being designed and constructed by United Airlines under a separate
reimbursement agreement and these dates may continue to shift.
Other Key Project Milestone Current Delivery Dates:
United Airlines Gates operating on B Concourse
2025 Quarter 4
United Airlines Lounge opening on B Concourse
2026 Quarter 1
Cost Breakdown
This Request
Total Project
Design
$750,000
$33,750,000
Construction
$6,750,000
$68,250,000 – $106,250,000
Total
$7,500,000
$102,000,000 – $140,000,000
ALTERNATIVES AND IMPLICATIONS CONSIDERED
The temporary measures identified by the project team provide multiple avenues of risk
mitigation to manage schedule impacts that are inevitable while in construction. These include
but are not limited to, material delivery delays, unforeseen existing conditions, labor availability
and significant cost escalation due to market conditions. There is a high probability of schedule
delays in delivering Concourse B Gates to United Airlines if the recommended Alternative 3 is not
implemented.
COMMISSION AGENDA – Action Item No. 8i Page 4 of 7
Meeting Date: January 9, 2024
Template revised June 27, 2019 (Diversity in Contracting).
Alternative 1 – No temporary office and ramp support space for existing tenants
Cost Implications: $500,000 - $1,000,000 (Acceleration Costs and/or Schedule delays)
Pros:
(1) Additional costs to facilitate the design and construction implementation of temporary
provisions would not be incurred.
(2) Existing tenants located on Concourse B ramp will only be relocated once to their
renovated office space, in lieu of an additional temporary relocation.
Cons:
(1) Does not allow the project team to mitigate schedule delays or improve construction
sequencing and phasing.
(2) Potential to delay United Airlines Gate allocation on Concourse B in 2025
(3) Delays the GCCM from beginning work in tenant lease spaces critical to facilitating the
United Airlines Gate allocation.
(4) Costs will continue to escalate.
(5) Significantly reduces the advantages of the GCCM contracting method by delaying the
work the mechanical and electrical subcontractors could negotiate and perform now.
This is not the recommended alternative.
Alternative 2 – Delay delivery of United Airlines gate allocation on Concourse B to align with the
Concourse B mechanical upgrades (No temporary conditioned air).
Cost Implications: $500,000 - $2,000,000 (Acceleration Costs and/or Schedule delays)
Pros:
(1) Additional costs to facilitate the design and construction implementation of temporary
provisions would not be incurred.
(2) The impact and coordination to existing ramp operations would be eliminated as the
temporary infrastructure would not be located at Concourse B ramp.
Cons:
(1) Does not allow the project team to mitigate schedule delays or improve construction
sequencing and phasing.
(2) Potential to delay United Airlines Gate allocation on Concourse B in September 2025
due to dependence on mechanical upgrades to Concourse B.
(3) Significantly reduces the advantages of the GCCM contracting method by delaying the
work the mechanical and electrical subcontractors could negotiate and perform now.
(4) Does not align with the Port’s overall airline realignment criteria and future gate
allocation by advancing the relocation of airlines as planned. 
This is not the recommended alternative.
COMMISSION AGENDA – Action Item No. 8i Page 5 of 7
Meeting Date: January 9, 2024
Template revised June 27, 2019 (Diversity in Contracting).
Alternative 3 – Authorize additional funding to address current market costs realized in the public
procurement of enabling work, as well as to support temporary provisions and early procurement
of long-lead materials to mitigate schedule risk in delivering Concourse B Gates
Cost Implications: $7,500,000
Pros:
(1) Provides intermediate office and ramp operations support space to tenants that must
be relocated from Concourse B to make way for necessary construction improvements
required to facilitate airline relocations.
(2) Promotes our priority of safety by limiting the existing tenants and operations that will
need to be maintained during construction.
(3) Supplemental conditioned air provided through temporary air handling units improves
the critical path schedule by allowing the Concourse B ramp office and support spaces
to be occupied ahead of final mechanical upgrades.
(4) Allows the project team to act quickly during the design phase to execute procurements
early when system components could impact schedule due to long lead time.
(5) Aligns with the current scheduling coordination with adjacent Airport projects.
(6) Supports the Port’s overall airline realignment criteria and future gate allocation by
advancing the relocation of airlines as planned. 
Cons:
(1) Temporary facilities and infrastructure services add design and construction costs that
were not anticipated at the time of project definition.
(2) Existing ramp operations may be impacted with additional temporary facilities placed
within very constrained ramp operational areas.
(3) Existing tenants located on Concourse B ramp will be relocated in a temporary condition
prior to final relocation to their renovated office space and ramp support spaces.
This is the recommended alternative.
FINANCIAL IMPLICATIONS
Cost Estimate/Authorization Summary
Capital
Expense
Total
COST ESTIMATE
Original estimate
$35,000,000
$35,000,000
$70,000,000
Previous changes – net
$34,000,000
($2,000,000)
$32,000,000
Current change – transfer of estimated
budget from expense to capital
$32,145,000
($32,145,000)
$0
Revised estimate
$101,145,000
$855,000
$102,000,000
AUTHORIZATION
Previous authorizations
$24,900,000
$22,700,000
$47,600,000
Transfer of authorization from expense to
capital
$22,002,000
($22,002,000)
$0
COMMISSION AGENDA – Action Item No. 8i Page 6 of 7
Meeting Date: January 9, 2024
Template revised June 27, 2019 (Diversity in Contracting).
Current request for authorization
$7,500,000
$0
$7,500,000
Total authorizations, including this request
$54,402,000
$698,000
$55,100,000
Remaining amount to be authorized
$46,743,000
$157,000
$46,900,000
Annual Budget Status and Source of Funds
This project, CIP C801158, was included in the 2024-2028 capital budget and plan of finance with
a capital budget of $69 million and an expense budget of $33 million for a total cost of $102
million. The expense components of the project in amount of $32,145,000 are now deemed as
capital. The capital budget of $32,145,000 was transferred from the Aeronautical Allowance CIP
C800753 resulting in no net change to the Airport capital budget. The funding sources will be
Airport Development Fund and revenue bonds.
Financial Analysis and Summary
Project cost for analysis
$102,000,000
Business Unit (BU)
Gates
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
CPE $0.35 starting in 2027
Future Revenues and Expenses (Total cost of ownership)
These improvements will replace aging and deficient infrastructure and building systems and
improve overall operation and maintenance of Concourse B Ramp. The project team will continue
to coordinate with Aviation Maintenance as the extents of operating and maintenance costs can
be more accurately evaluated with further design development. Complete upgrade and
replacement of the HVAC system serving the project footprint increases code compliant leasable
space, giving the Port flexibility and potential for increased revenues.
ADDITIONAL BACKGROUND
The project team is meeting with adjacent projects to coordinate project schedules, scope
overlap and other necessary items to limit construction impacts to normal airport and tenant
operations.
(1) Baggage Optimization Program
(2) Main Terminal Low Voltage Upgrades
(3) North Main Terminal Redevelopment
(4) Concourse HVAC Infrastructure Renewal and Replacement Program (CHIRRP)
(5) 2024 Airfield Improvement Project
(6) 2026 Airfield Improvement Project
ATTACHMENTS TO THIS REQUEST
(1) Presentation slides
COMMISSION AGENDA – Action Item No. 8i Page 7 of 7
Meeting Date: January 9, 2024
Template revised June 27, 2019 (Diversity in Contracting).
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS
September 26, 2023 – Commission authorized $14,400,000 to facilitate the following
actions: (1) authorize enabling construction work for the Post IAF Airline Realignment
project at Seattle-Tacoma International Airport, (2) procure long lead items, (3) increase
the project authorization by $14,400,000, and (4) execute a project labor agreement.
September 12, 2023 – The commission was briefed on the program status and schedule for
future authorization requests.
February 14, 2023 – The commission authorized $7,000,000 to facilitate the following actions:
(1) amend a project-specific design contract, and (2) execute a Change Order to the
General Contractor/Construction Manager Pre-Construction Services contract.
March 23, 2021 – The Commission authorized $26,000,000 to facilitate the following actions:
(1) execute project specific Service Agreements for project management, construction
management, design services, and testing and special inspections; (2) to utilize a General
Contractor/Construction Manager (GCCM) and execute a GCCM construction contract for
pre-construction services; (3) to use port crews; and (4) to execute a Memorandum of
Agreement (MOA) between the Port of Seattle (Port) and United Airlines.