COMMISSION 
AGENDA MEMORANDUM                Item No.       4h 
ACTION ITEM                   Date of Meeting    December 13, 2016 
DATE:    November 15, 2016 
TO:     Ted Fick, Chief Executive Officer 
FROM:   Stuart Mathews, Director, Aviation Maintenance 
SUBJECT:  Siemens DDC Service Contract 
Amount of this request:          $3,600,000 

ACTION REQUESTED 
Request Commission authorization for the Chief Executive Officer to execute a service
agreement between Siemens Building Technologies USA and Seattle-Tacoma International
Airport for the Airport's Direct Digital Control System for the next three years with options for
two, 1-year extensions. Total dollar value for the 5-year term is estimated at $3.6 million. 
EXECUTIVE SUMMARY 
This procurement will allow the Port staff to continue to appropriately operate and maintain
the Airport's Direct Digital Control (DDC) System. This service contract will aid Port staff in
maintaining the airport's mechanical systems and provide appropriate operating conditions
throughout the facility. The system controls and monitors most airport terminal mechanical
systems such as heating and cooling, air flow and vibration set-points, and is considered critical
to monitoring the airport infrastructure. 
The Siemens DDC system is a proprietary system with proprietary software updates, tools and
training provided only to Siemens technicians. As such, a CPO-5 Policy Waiver has been
generated and routed to allow the Port to enter into a contract with Siemens without
competing the service contract. Through the Central Procurement Office, contract negotiations
will take place with Siemens to develop the detailed contract pricing and scope. 
JUSTIFICATION 
The objective of this request is to allow the Aviation Maintenance Department to continue to
maintain the Siemens Direct Digital Control System in an effective manner, ensuring the Airport
continues to operate effectively. 


Template revised September 22, 2016.

COMMISSION AGENDA  Action Item No. _4h___                    Page 2 of 5 
Meeting Date: December 13, 2016 
DETAILS 
The system monitors multiple functions throughout the airport via a variety of existing
infrastructure and components such as fans, pumps, temperature sensors in the
terminal and air flow monitors. 
Examples of important systems monitored, controlled and maintained utilizing the DDC
system include the Central Mechanical Plant, which provides nearly all heating and
cooling for the facility, the Pre-conditioned Air Plant, providing heating and cooling to
aircraft, smoke control systems as part of our fire suppression system, and the domestic
and fire suppression water system for the Airport. 
The recommended option places us at a price point comparable with other Siemens
supported airports on a cost per monitoring point basis. 
Current Service Agreement ends on 12-31-16. 
Two new major installations with DDC systems, which greatly increase the size, will be
coming on-line; IAF and NorthStar. 
Scope of Work 
There are multiple elements that collectively make up the scope of work of this service
agreement. Those elements are summarized in the bullet points below: 
This agreement will provide services to optimize the system control software,ensuring 
that the Heating, Ventilation and Cooling (HVAC) Control System is operating properly.
The service will minimize any software problems that would negatively impact system
performance. This service will also ensure reliable and optimized communication
throughout the Port's HVAC Control System's Building Level Network (BLN) of field
panels. 
Automation controls can drift out of calibration with changes in mechanical component
performance characteristics, building use, and climatic conditions. This service will
extend equipment life, reduce energy consumption, and reduce the risk of costly and 
disruptive breakdowns through appropriate system component calibration. 
This service agreement will provide the Port with new features and enhancements that
will improve building operations and take advantage of the latest software version
updates, while extending the life of the system investment. This service will provide the
Port with software and documentation updates to the existing system as they become
available (approximately annually) throughout the life of the contract. 
The Port will receive protection for the HVAC Control System's databases of business
information from unforeseen catastrophic events (lightning strike, electrical power
surge, hard drive or controller failure, flood, physical damage, etc.). This service will
provide quarterly database back-ups. 

Template revised September 22, 2016.

COMMISSION AGENDA  Action Item No. _4h___                    Page 3 of 5 
Meeting Date: December 13, 2016 
As a portion of this service, the contractor will provide unlimited system and software
troubleshooting and diagnostics via remote and direct phone support. The contractor
will provide on-site service during normal business hours. 
Schedule 
New service contract can be implemented once approved. The current agreement ends
December 31, 2016. 
ALTERNATIVES AND IMPLICATIONS CONSIDERED 
Three different variations of the new service contract are proposed below. 
Alternative 1  Renew the service contract at its current level of service for 1-year with a price
escalation due to inflation. Service levels for 2017 to be the same as 2016, except with current
rates. 
Cost Implications: Estimated $427,000 for 2017-Expense Cost. ($4.27 cost per point x 100,000
points incorporating 3% escalation) 
Pros: 
This is will allow us to have some service support in 2017, while providing a 12 month
timeframe to negotiate a service contract for future years with improved pricing. 
This option does not commit the Port to a long-term contract.
Cons: 
A one year contract will require the immediate start of another procurement process in
2017 for future years, consuming staff time. 
This alternative does not allow us to adjust the service level for the increased system
size and complexity that has developed over the past five years. 
There is no opportunity to leverage the value of a multiple year contract with the
vendor to improve the level of service. 
This is not the recommended alternative. 
Alternative 2  Procure a service contract for a duration of three years. 
Cost Implications:  Estimated $1.95 Million Expense Cost for the 3-year service contract
duration. 
Pros: 
This alternative allows us to adjust our service level to the level recommended by the
manufacturer for a system of this size and complexity. 
Increasing system service support will reduce the risk of a system failure that could
negatively impact operations of the airport. 

Template revised September 22, 2016.

COMMISSION AGENDA  Action Item No. _4h___                    Page 4 of 5 
Meeting Date: December 13, 2016 
This option places us within 8% of comparable airports based on cost on a per point
basis. 
Cons: 
This alternative commits the Port to an average annual expense of $651,000 for the next
3 years, which is higher than our current level of service. This will require an increase in
our expense budget from the current level. 
The contract will be expiring just before major new facilities will be coming on line,
requiring the negotiations of a new contract while the facilities are still being built. The
exact impact of the new facilities on the overall system may not be fully developed. This
may make negotiating a new contract service level difficult. 
This is not the recommended alternative. 
Alternative 3    Procure an initial 3-Year Service Contract with options for two, 1-year
extensions. 
Cost Implications: $3.6 Million Expense Cost for the 5-year service contract duration. 
Pros: 
This alternative provides a higher level of service from our current level, to better
support the larger and more complex system.
Increasing system service support will reduce the risk of a system failure that could
negatively impact operations of the airport. 
The renewal year options provide flexibility for both the vendor and the Port at a point
in the contract when new facilities will be brought on line. This alternative will provide
an avenue to address system changes as a result of those facilities.
This method will allow staff and CPO to negotiate scope and costs in outlying years, as
the facility and business conditions may change. Annual costs would be approved as
part of the regular expense budgeting process. 
The goal of the preferred alternative will be to operate at a level closer to current
contract in the first year of the 3-5 year contract, while we negotiate the price and level
of service in time to budget appropriately in 2018 and 2019. 
Cons: 
This alternative will result in a higher annual expense than other alternatives
considered. 
This is the recommended alternative. 
FINANCIAL IMPLICATIONS 
The costs of this service agreement are accounted for as operating expenses. 

Template revised September 22, 2016.

COMMISSION AGENDA  Action Item No. _4h___                    Page 5 of 5 
Meeting Date: December 13, 2016 
Annual Budget Status and Source of Funds 
Contract payments are included as a specific line item in the Aviation Maintenance expense
budget. The funding source is the Airport Development Fund. Funding for future years will be
included in future Aviation Maintenance annual expense budgets as a specific line item. The
annual impact on passenger airline cost per enplanement is approximately $0.01 - $0.02. 
ADDITIONAL BACKGROUND 
The Siemens Direct Digital Controls (DDC) system was originally procured through a competitive
bidding process dating back to the 1980's. At that time, Siemens was the low bidder on the
original Concourse A expansion. Siemens was also the low bidder on the 1991 Concourse B, C,
and D Upgrade project. Both of these projects were "open" bids with no competition waiver
requirements. 
In 2008, Siemens was the low bidder on the Rental Car Facility Project, designed as a standalone
DDC system that was "open" bid with no competition waiver requirements. Also in 2010,
Siemens was the successful low bidder for the PC Air system that was "open" bid with no
competition waiver requirements. Between and after these major projects, the DDC system has
been expanded in a "Sole Source" capacity. 
During the current contract period, the number of points being monitored has grown over 25%
and the number of field panels has grown over 60%, while costs have remained constant. 
For reference, a point is defined as any item in the system that can be monitored or controlled
by the system. Examples of points include thermostat temperatures in a localized space or a
damper position on a terminal box in an office ceiling. Field panels contain the control units
that operate the control devices in the field, and communicate with the main control system.
As such, these points and field panels must be properly maintained to ensure the efficient
operation of the system. As the system has grown in size, complexity, and criticality, so has
staff's need for support due to the growth in volume of our passengers. 
This execution of a new 5-year contract will incorporate an option to cancel the contract at the
completion of any year of the contract with 60 days written notice. 
ATTACHMENTS TO THIS REQUEST 
None 
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS 
December 6, 2011 - The Commission authorized a five year service agreement with Siemens
Building Technologies USA for system maintenance. 


Template revised September 22, 2016.