Template revised January 10, 2019.
COMMISSION
AGENDA MEMORANDUM Item No. 8c
ACTION ITEM Date of Meeting November 18, 2025
DATE : September 25, 2025
TO: Stephen P. Metruck, Executive Director
FROM: Mike Tasker, Director AV Maintenance
Erik Knowles, Assistant Director AV Maintenance
SUBJECT: Onsite Daifuku Baggage Controls Technician
Amount of this request: $3,400,000
Total estimated project cost: $3,400,000
ACTION REQUESTED
Request Commission authorization for the Executive Director to execute an agreement to
Daifuku Services America Corporation, in accordance with RCW 39.04.280 competition waiver,
for rapid, technical onsite services for three years with two additional option years, for a not to
exceed amount of $3,400,000, to troubleshoot, make program modifications, provide guidance,
assist AVM, and resolve problems within minutes.
EXECUTIVE SUMMARY
The new Daifuku control system for the new baggage handling system is a very complex system
that requires Daifuku-specific technical knowledge, know-how, and experience to optimize the
baggage handling system uptime. The baggage handling system (BHS) is being replaced and
includes new controls by Daifuku Services America Corporation (formerly known as Jervis B.
Webb). Aviation Maintenance (AVM) renews a technical, 100% remote, support contract (TSP)
annually that provides the Port with priority access to Daifuku's call center; however, the call
center can only guarantee a one-hour response time. The AVM baggage team must respond and
identify a problem within minutes. Waiting up to an hour is a significant risk to the operation and
our customers/airlines/passengers; having a Daifuku technician onsite mitigates that risk and
contributes to the Customer Experience as identified in the 2025 Aviation Business Plan.
Although the Daifuku control system was selected through an open, competitive procurement
process with the Baggage Optimization Phase I and II project, in accordance with RCW 39.04.280,
a competition waiver, #2025-010, was approved for this on-site service due to its propriety
baggage system services.
COMMISSION AGENDA – Action Item No. 8c Page 2 of 4
Meeting Date: November 18, 2025
Template revised June 27, 2019 (Diversity in Contracting).
JUSTIFICATION
1) Quick response times on the order of minutes is required to ensure proper baggage system
operations.
2) This action will reduce baggage system interruption durations that otherwise impact airline
operations or passenger experience.
3) This contract includes an onsite and on-call response requirement, which eliminates the need
for the remote support contract (TSP).
4) This work is included in the 2025 AV Business Plan and will contribute to the upcoming five
business cycles (three business cycles with options to extend two years.)
Diversity in Contracting
Diversity in Contracting has not been contacted due to an active competition waiver for Daifuku.
DETAILS
This work provides a Daifuku technician and uninhibited access to the baggage control system
during peak startup hours on the weekdays resulting in real-time troubleshooting and resolution.
Total costs are estimated to be $3,400,000.
Scope of Work
The onsite technician will be providing instant troubleshooting, program modifications, problem
resolution, and reporting ensuring optimal system operation, configuration, and after-action
reporting.
Activity
Commission authorization 2025 Quarter 4
Procurement complete 2026 Quarter 1
Vendor technician training at headquarters 2026 Quarter 1
Vendor technician onsite 2026 Quarter 2
Cost Breakdown This Request Total Project
First three years $2,046,000 $2,046,000
Year 4 $649,000 $649,000
Year 5 $672,000 $672,000
Total $3,366,000 $3,366,000
COMMISSION AGENDA – Action Item No. 8c Page 3 of 4
Meeting Date: November 18, 2025
Template revised June 27, 2019 (Diversity in Contracting).
ALTERNATIVES AND IMPLICATIONS CONSIDERED
Alternative 1 – Hire and train a baggage controls engineer
Cost Implications: $150,000 - $250,000 a year (burdened)
Pros:
(1) Company staff will have a vested interest in quality and response
Cons:
(1) Market and access to training for proprietary products is not available.
(2) A Port controls engineer will not be available 24/7.
(3) This alternative will require the Port to renew the technical services contract with
Daifuku keeping the one-hour response time and is a risk to the operation.
(4) All additional work requires separate purchase orders and delays improvements.
(5) A full-time employee is not in the staffing model.
This is not the recommended alternative.
Alternative 2 – Use existing baggage controls contractor, Daifuku, to be onsite and support the
Daifuku baggage controls system.
Cost Implications: $3,400,000
Pros:
(1) Instantaneous response when on-site. There are peak passenger times when baggage
can back up to the ticket counters in less than 2 minutes.
(2) Provides the reliability and capacity needed for critical airport and airline baggage
operations.
(3) Eliminating purchase orders improves timeliness of system improvements.
(4) Cost recovery from discontinuing the technical support contract and additional
purchase orders.
Cons:
(1) Using non-Port staff risks institutional knowledge and continuity.
(2) Costly
This is the recommended alternative.
COMMISSION AGENDA – Action Item No. 8c Page 4 of 4
Meeting Date: November 18, 2025
Template revised June 27, 2019 (Diversity in Contracting).
FINANCIAL IMPLICATIONS
Cost Estimate/Authorization Summary Capital Expense Total
COST ESTIMATE
Original estimate 0 $3,400,000 $3,400,000
AUTHORIZATION
Previous authorizations 0 0 0
Current request for authorization 0 $3,400,000 $3,400,000
Total authorizations, including this request 0 $3,400,000 $3,400,000
Remaining amount to be authorized $0 $3,400,000 $3,400,000
Annual Budget Status and Source of Funds
This item is approved for the 2026 budget.
Financial Analysis and Summary
Project cost for analysis $3,400,000
Business Unit (BU) Aviation Maintenance
Effect on business performance
(NOI after depreciation)
No depreciation
IRR/NPV (if relevant) NPV
CPE Impact
Future Revenues and Expenses (Total cost of ownership)
There are no revenues. Expenses are not tied to assets.
ADDITIONAL BACKGROUND
The Baggage Optimization Project is broken into three phases with the first two completed as of
2024. The first two phases included the Daifuku baggage handling system which went live in April
2020. It is an essential operational component of the passenger experience and used throughout
the airport to move passenger’s bags from the ticket counter, through TSA screening, and sorting
to the appropriate airline lease area.
ATTACHMENTS TO THIS REQUEST
(1) Competition Waiver
(2) Daifuku Proposal
(3) PowerPoint
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS
None
