Template revised September 22, 2016. COMMISSION AGENDA MEMORANDUM Item No. CTION ITEM May 9, 2017 Amount of this request: 500,000 Total estimated project cost: 500,000 ACTION REQUESTED EXECUTIVE SUMMARY JUSTIFICATION DETAILS Port Construction Services (PCS) will manage this project and the procurement of the new wall panel materials . The product previously used at the South Terminal Expansion project is still on the market , allowing us to procure the exact product to ensure a consistent and uniform ��COMMISSION AGENDA Action Item No. Page of Template revised September 22, 2016; format updates October 19, 2016. aesthetic in baggage claim. Work will be co mpleted around airline schedules and coordinated with Airport Security for work around doors and in high demand locations. Scope of Work This project will replace all remaining old green wall panels with the new standard silver laminate panels, trim, and new cove base. Schedule This project will procure wall panel materials in the second quarter of 2017 and complete replacement of all panels by the end of 2017. Activity Commission uthorization 2017 Q2 Construction tart 2017 Q2 se ate 2017 Q4 Cost Breakdown This Request Total Project Design Construction (Material Purchase and Installation) $500,00 $500,000 Total 500,000 500,000 ALTERNATIVES AND IMPLICATIONS CONSIDERED Alternative 1 Include panel replacement only when projects impact baggage claim walls Cost Im plications No cost outside of project costs Pros (1) We wouldn’t need to pay for replacement of panels unless it was Port project Cons (1) Very lengthy and might never touch all wall panels (2) May require different materials if product becomes obsolete (3) Will not give Baggage Claim a cohesive look (4) Will not prepare Baggage C laim for the continued growth we are seeing (5) Baggage Claim will continue to be dark and perceived as dirty This is not the recommended alternative. Alternative Use of PCS annual budget to replace each year Cost Implications $50,000 per year Pros (1) Low cost worked into annual budget ��COMMISSION AGENDA Action Item No. Page of Template revised September 22, 2016; format updates October 19, 2016. Cons (1) Very lengthy and will take 8 10 years to complete (2) May require different materials if product becomes obsolete (3) Will not giv e Baggage Claim a cohesive look (4) Will not prepare Baggage Claim for the continued growth we are seeing (5) Baggage Claim will continue to be dark and perceived as dirty This is not the recommended alternative. Alternative 3 Proceed with project to replace all panels Cost Implications $500,000 Pros (1) Baggage Claim appearance will begin to improve Summer 2017 (2) Budget is an approved line item in PCS 2017 budget (3) All wall panels will be the same, bright, and contemporary (4) Cost of wall panels will escalate over ensuing years (5) Purchasing and installing this year ensures the laminate décor is not discontinued prior to completion (6) This supports our efforts to meet the region’s air transportation needs by improving the aesthetics of our baggage claim Cons (1) To complete work by the end of 2017, work may hamper day and night operations near baggage carousels and belts, access through oversized baggage windows and bagwell doors, and use of escalators from north and south STS train stations , specifically along the west wall This is the recommended alternative. FINANCIAL IMPLICATIONS Cost Estimate /Authorization Summary Capital Expense Total COST ESTIMATE Original estimate 500,000 500,000 AUTHORIZATION Previous authorizations Current request for authorization $500,000 $500,000 Total authorizations, including this request $500,000 $500,000 Remaining amount to be authorized Annual Budget Status and Source of Funds This project is included in the PCS 2017 operating budget for $500,000. The funding source will be the Airport Development Fund. ��COMMISSION AGENDA Action Item No. Page of Template revised September 22, 2016; format updates October 19, 2016. Financial Analysis and Summary Project cost for analysis $500,000 Business Unit (BU) Terminal Building Effect on business performance (NOI after depreciation) NOI after depreciation will decrease as only 77% of cost will be recovered in airline rate base. IRR/NPV (if relevant) CPE Impact .01 in 2017 ATTACHMENTS TO THIS REQUEST (1) Presentation slides PREVIOUS COMMISSION ACTIONS OR BRIEFINGS None