Template revised January 10, 2019.

COMMISSION

AGENDA MEMORANDUM

Item No. 8h

ACTION ITEM Date of Meeting October 22, 2024

DATE: October 15, 2024

TO: Stephen P. Metruck, Executive Director

FROM: Eileen Francisco, Director Aviation Project Management

Laurel Dunphy, Director Airport Operations

Keri Stephens, Director Aviation Facility and Capital Program

SUBJECT: 2025 Airfield Projects Contract 1 Construction Authorization (CIP# C800930,

C801177 and C801303)

Amount of this request: $20,850,000

Total estimated project cost:

$197,904,000

ACTION REQUESTED

Request Commission authorization for the Executive Director to (1) advertise and execute a

construction contract for 2025 Airfield Projects - Contract 1; (2) transfer budget/authorization

among the 2025 Airfield Projects; (3) transfer budget/authorization for South Concourse utility

replacement scope from CIP C800930 2021-2025 Airfield Pavement and Supporting

Infrastructure to CIP 801203 South Concourse Evolution; (4) procure long lead items; (5) include

a Project Labor Agreement for the contract; and (6) authorize use of Port crews for abatement

work.

2025 Airfield Projects – Contract 1 encompasses pavement and utility infrastructure. The

amount of this authorization request is $20,850,000.

EXECUTIVE SUMMARY

This construction contract is comprised of three interdependent Capital Improvement Projects

(CIPs). The details of the authorization and total estimated project cost by CIP are shown

below.

CIP Name/#

Amount of this Request

Total Estimated Project Cost

2021-2025 Airfield Pavement and

Supporting Infrastructure

Replacement Program C800930

$3,726,000 $177,874,000

COMMISSION AGENDA – Action Item No. 8h Page 2 of 9

Meeting Date: October 22, 2024

Template revised June 27, 2019 (Diversity in Contracting).

Airfield Utilities Improvement

C801177

$17,124,000 $20,030,000

Taxiway A Circuit Replacement

C801303

$0 $39,500,000

Total Authorization of this

Request

$20,850,000

The above projects have overlapping work areas and design functionality, interdependent

operational impacts, and share 2025 schedule milestones. As such they were planned,

designed, and phased to be delivered concurrently for purposes of Airfield safety, efficiency,

and minimization of operational impacts.

JUSTIFICATION

The projects being co-delivered via the 2025 Airfield Projects - Contract 1 consist of a variety of

physically and functionally interdependent Capital Improvements designed to renew and

replace failing infrastructure, ensure continued operational safety and security, and meet SEA’s

regulatory requirements. The Taxiway A Circuit Replacement project obtained full Commission

authorization in March 2024 for design and construction. The justification of the two projects

(CIPs) under this authorization request is summarized below:

The 2021-2025 Airfield Pavement and Supporting Infrastructure Replacement Program is an

ongoing program of airfield pavement replacement and is required to provide safe and efficient

conditions for aircraft operations and meet Federal Aviation Administration (FAA)

requirements.

Airfield Utility Improvement (AUI) is an ongoing project to replace aging, failing, and over-

capacity utility systems serving the existing terminal and apron areas.

This request includes authorization to transfer scopes consisting of Industrial Wastewater

System (IWS) and power lines from 2021-2025 Airfield Pavement and Supporting Infrastructure

C800930 to South Concourse Evolution C801203. These scopes are within the work area limits

for the South Concourse Evolution project, and not time sensitive. Including them with the

South Concourse Evolution project will be more efficient and avoid impacting the same gates

twice.

Diversity in Contracting

Through the Diversity in Contracting program, a Women and Minority Business Enterprise

(WMBE) aspirational goal of 12% will be included in the procurement of the construction

contract.

COMMISSION AGENDA – Action Item No. 8h Page 3 of 9

Meeting Date: October 22, 2024

Template revised June 27, 2019 (Diversity in Contracting).

DETAILS

These projects will interface with other projects and airline operations. Continual coordination

with Airport Operations, Airlines, and related Tenants will ensure the least possible operational

impact during construction.

A project labor agreement will be used for these projects based on the importance of labor

continuity and the need to minimize any risk of impact to operations during construction.

Scope of Work

The 2021-2025 Airfield Pavement and Supporting Infrastructure Replacement Program replaces

distressed airfield pavements, joint sealant, and supporting infrastructure at the Airport.

Airfield work under this program in 2025 includes pavement replacement along the South

Concourse Taxilane, around the Q gates and Spot 55, and along Taxiway A; joint sealant

replacement at Taxiway E, G, C, and D; guidance signage replacement; Channel Drain

replacement outside gate A4, and oil water separator installation at the batch plant area.

Project staff will procure long lead items including miscellaneous frames and covers for airfield

utilities.

The AUI project is a three-year project to replace aging, failing, and over-capacity utility systems

serving the existing terminal and apron areas. The 2024 AUI scope is located on the north side

of the South Concourse and Concourse C, including sanitary sewer, domestic power,

communications, and the IWS.

Schedule

Activity

Construction start 2025 Quarter 2

In-use date 2026 Quarter 2

Cost Breakdown This Request Total Project

2021-2025 Airfield Pavement and Supporting Infrastructure Replacement Prog. (C800930)

Design $0 $16,000,000

Construction $3,726,000 $161,874,000

Total $3,726,000 $177,874,000

Airfield Utility Improvements (C801177)

Design $0 $2,905,200

Construction $17,124,000 $17,124,800

Total $17,124,000 $20,030,000

COMMISSION AGENDA – Action Item No. 8h Page 4 of 9

Meeting Date: October 22, 2024

Template revised June 27, 2019 (Diversity in Contracting).

ALTERNATIVES AND IMPLICATIONS CONSIDERED

Alternative 1 – Proceed only with Airfield Pavement and Supporting Infrastructure

Replacement Program scope. Do not proceed with the project scope in the Airfield Utility

Improvements which includes sanitary sewer main pipe, power, communication, and the

Industrial Wastewater System (IWS)

Cost Implications: $3,726,000 in Capital Cost for 2025 Airfield Pavement and Supporting

infrastructure Replacement Project.

Pros:

1. Reduced capital spending in 2025.

2. Less construction impacts to airport/airline operations in 2025.

Cons:

1. Risk of a failed sanitary sewer and impacts to Main Terminal and South Concourse

operations.

2. Sewer capacity will not meet current or future needs of the Main Terminal, Concourse

C, and South Concourse.

3. Will cause future operational impacts to repair, replace, or install other utilities in the

same areas.

This is not the recommended alternative.

Alternative 2 – Construct each individual project with separate construction contracts.

Cost Implications: $23,000,000 in Capital Cost to deliver the projects via two major construction

contracts, $2,150,000 more than delivering via one major construction contract as proposed by

the recommended alternative.

Pros:

1. Less complexity for budget tracking during construction.

Cons:

1. Reduced efficiencies due to rework.

2. Additional labor costs for contractor on-boarding and mobilizations, double-project

ramp up and close out.

3. Increased coordination required between overlapping projects.

4. Increased construction safety risk due to overlapping work areas.

5. Additional and recurring impacts to airfield operations until all efforts are completed.

This is not the recommended alternative.

COMMISSION AGENDA – Action Item No. 8h Page 5 of 9

Meeting Date: October 22, 2024

Template revised June 27, 2019 (Diversity in Contracting).

Alternative 3 – Move forward to construct the projects as a single coordinated effort.

Cost Implications: $20,850,000

Pros:

1. Reduces safety risks, minimizes operational impacts and increases efficiencies as

coordination and construction is managed as a single effort.

2. Minimizes time to completion, limiting exposure to future cost increases, while

delivering benefits expeditiously.

3. Programmatic replacement of aged and distressed pavements and related

infrastructures.

Cons:

1. Earlier capital spending in 2025.

This is the recommended alternative.

FINANCIAL IMPLICATIONS

2021-2025 Airfield Pavement and Supporting Infrastructure Replacement Program

(C800930) -

Cost Estimate/Authorization Summary Capital Expense

Total

COST ESTIMATE

Original estimate $155,740,000

$560,000

$156,300,000

Previous changes – net $23,970,000

$23,970,000

Current Change ($2,396,000)

($2,396,000)

Revised estimate $177,314,000

$560,000

$177,874,000

AUTHORIZATION

Previous authorizations $153,546,000

$360,000

$153,906,000

Authorization transferred from C801177 $20,242,000

$20,242,000

Current request for authorization $3,526,000

$200,000

$3,726,000

Total authorizations, including this request $177,314,000

$560,000

$177,874,000

Remaining amount to be authorized $0

COMMISSION AGENDA – Action Item No. 8h Page 6 of 9

Meeting Date: October 22, 2024

Template revised June 27, 2019 (Diversity in Contracting).

Airfield Utility Improvements (C801177) –

Cost Estimate/Authorization Summary Capital

Expense

Total

COST ESTIMATE

Original estimate $34,592,000

$34,592,000

Previous changes – net ($14,562,000)

($14,562,000)

Revised estimate $20,030,000

$20,030,000

AUTHORIZATION

Previous authorizations $23,148,000

$23,148,000

Authorization transferred to C800930 ($20,242,000)

($20,242,000)

Current request for authorization $17,124,000

$17,124,000

Total authorizations, including this request $20,030,000

$20,030,000

Remaining amount to be authorized $0

Annual Budget Status and Source of Funds

2021-2025 Airfield Pavement and Supporting Infrastructure Replacement Program

(CIP C800930)

This project was included in the 2024-2028 capital budget and plan of finance with a

budget of $159,467,559. The capital increase of $17,846,441 was transferred from the

Aeronautical Allowance

CIP C800753 resulting in no net change to the Airport capital

budget. This project has a Majority-In-Interest approval from the airlines in January

2020. The funding sources will be the Airport Development Fund, AIP grants, and

revenue bonds. The capital project C800930 receives federal grant funding for eligible

items meeting FAA standards with no anticipated FAA grant reimbursement for the year

2025 and a total of $50,000,000 expected for the life of the program.

AF Utility Improvements (CIP C801177)

This project was included in the 2024-2028 capital budget and plan of finance with a

budget of $40,272,441. The capital decrease of $20,242,441 was transferred to the

Aeronautical Allowance CIP C800753 resulting in no net change to the Airport capital

budget. The funding sources would be the Airport Development Fund and existing

Airport Revenue Bonds.

The Aeronautical Allowance is included in the Capital Improvement Plan to ensure funding capacity for

unspecified projects, cost increases for existing projects, new initiatives, and unforeseen needs. This ensures funding

capacity for unanticipated spending within the dollar amount of the Allowance CIP.

COMMISSION AGENDA – Action Item No. 8h Page 7 of 9

Meeting Date: October 22, 2024

Template revised June 27, 2019 (Diversity in Contracting).

Financial Analysis and Summary

C800930 2021-2025 Airfield Pavement and Supporting Infrastructure Replacement Program

Project cost for analysis $177,874,000

Business Unit (BU) Airfield movement and Airfield apron

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 Total project cost CPE of $0.40 in 2027; annual CPE of

$0.01 in 2027.

C801177 AF Utility Improvements

Project cost for analysis $20,030,000

Business Unit (BU) Airfield movement and airfield apron

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 $0.06 in 2027

Future Revenues and Expenses (Total cost of ownership)

2021-2025 Airfield Pavement and Supporting Infrastructure Replacement Program (CIP

C800930)

The AIP project will not have an impact on annual Aviation Maintenance Operating and

Maintenance (O&M) costs for the pavement assets. This project may lead to a reduction in the

amount of time currently spent by the Port Maintenance team on joint seal and pavement spall

repairs. After implementing the project, the improved portions of the pavement will have a

renewed 40-year asset life and a greatly reduced risk of the pavement producing loose gravel

and rock Foreign Object Debris (“FOD”) that could be picked up by vehicle tires or blown by jet

engine exhaust and spread across the apron, taxiways and runways.

Airfield Utilities Infrastructure (AUI) (CIP C801177)

The AUI project will not have an impact on annual Aviation Maintenance O&M costs for

mechanical or electrical systems and may lead to a reduction in the amount of time currently

spent by the field crew on pipe inspections due to the current condition of the water and sewer

systems. After implementing the project, the improved portions of the water and sewer

systems will have a renewed 50-year asset life and a greatly reduced risk of failures, emergency

repair and maintenance work, and impacts to operations.

COMMISSION AGENDA – Action Item No. 8h Page 8 of 9

Meeting Date: October 22, 2024

Template revised June 27, 2019 (Diversity in Contracting).

ATTACHMENTS TO THIS REQUEST

(1) Presentation slides

PREVIOUS COMMISSION ACTIONS OR BRIEFINGS

2021-2025 Airfield Pavement and Supporting Infrastructure Replacement Program (CIP

C800930).

March 12, 2024 – The Commission authorized for the Executive Director to (1) advertise and

execute a construction contract for 2024 Airfield Projects–Contract 2; (2) transfer

budget/authorization, as necessary, between the 2024 Airfield Projects; (3) procure long

lead items; (4) include a Project Labor Agreement for the contract; and (5) authorize use

of Port crews for abatement work.

October 24, 2023 – The Commission authorized for the Executive Director to (1) advertise

and execute a construction contract for 2024 Airfield Projects - Contract 1; (2) transfer

budget/authorization, as necessary, between the 2024 Airfield Projects; (3) transfer

budget/authorization for Gate B11 Passenger Loading Bridge (PLB) civil foundation from

CIP C801180 PLB Phase 3 Project to CIP C800930 2021-2025 Airfield Pavement and

Supporting Infrastructure Replacement Program; (4) procure long lead items; (5) include

a Project Labor Agreement for the contract; and (6) authorize use of Port crews for

abatement work. 2024 Airfield Projects – Contract 1 encompasses federally funded

pavement and utility infrastructure. The amount of this authorization request is

$50,500,000.

October 25, 2022 – The Commission authorized the Executive Director to (1) advertise,

execute two separate construction contracts, and transfer budget/authorization, as

necessary, among the 2023 Airfield Projects; (2) procure long lead items; (3) include a

Project Labor Agreement for both contracts; (4) authorize use of Port crews for

abatement work. The amount of this authorization request is $67,153,000. The total

estimated cost for all projects included in this authorization is $255,945,000.

November 16, 2021 - The Commission authorized the Executive Director to (1) advertise

and execute a major works construction contract and (2) include a Project Labor

Agreement for the 2022 Airfield Pavement and Supporting Infrastructure Replacement

Project, at the Seattle-Tacoma International Airport. This authorization is for

$24,000,000 with a total authorized to date of $79,195,000 and a previously approved

total 2021-2025 program budget of $153,500,000.

August 10, 2021 – The Commission authorized the Executive Director to advertise and

award a major public works contract to replace the North Runway Protection Zone

Culvert (NRPZ Culvert), a year 2022 component of the 2021 to 2025 Airfield Pavement

and Supporting Infrastructure Replacement Program. This construction authorization is

for $3,800,000 for a total program authorization to date of $55,195,000. The total 2021-

2025 program cost is $153,500,000.

November 10, 2020 – The Commission authorized the Executive Director to (1) advertise

and execute a major works construction contract and (2) include a project labor

COMMISSION AGENDA – Action Item No. 8h Page 9 of 9

Meeting Date: October 22, 2024

Template revised June 27, 2019 (Diversity in Contracting).

agreement for the replacement of distressed pavements and supporting infrastructure

for the 2021 portion of the 2021-2025 Airfield Pavement and Supporting Infrastructure

Replacement Program at the Seattle-Tacoma International Airport. This construction

authorization is for $37,900,000 for a total authorization to date of $51,395,000. The

total 2021-2025 program cost is $153,500,000.

October 22, 2019 – The Commission authorized the Executive Director to authorize design

and preparation of construction documents for the 2021-2025 Airfield Pavement and

Supporting Infrastructure Replacement Projects at the Seattle-Tacoma International

Airport in the amount of $16,000,000 and approve the use of a project labor agreement

(PLA) for each year’s construction contract.