8c. Memo

C Concourse Expansion Project Service Agreement

AGENDA MEMORANDUM                        Item No.          8c 
ACTION ITEM                            Date of Meeting       March 8, 2022 

DATE:     February 25, 2022 
TO:        Stephen P. Metruck, Executive Director 
FROM:    Wayne Grotheer, Director Aviation Project Management 
Jeff Wolf, Interim Director Aviation Commercial Management 
SUBJECT:  C  Concourse  Expansion   Third-Party  Commissioning  Agent  Authorization 
(CIP# C800845) 
Amount of this request:               $1,500,000 
Total estimated project cost:        $340,000,000 
Request  Commission  authorization  to  execute  a  Service  Agreement  for  a third-party
commissioning agent for the C Concourse Expansion Project at Seattle-Tacoma International
Third-party commissioning agent services provide verification that the Port's investment in
high-performance systems is yielding optimum results, both in long-term cost reductions and
operational efficiencies. Third-party commissioning agents represent the Port as subject matter
experts, independent of the project designers and the selected construction contractor.  The
third-party commissioning agents for the C Concourse Expansion project (formerly known as
the C1 building project) will review drawings, develop commissioning plans and procedures,
conduct field investigations, and submit reports that ensure systems and equipment are
designed, installed and function in accordance with Port standards and all code compliance
requirements. The C Concourse Expansion Project is requesting authorization to advertise and
execute a contract at this time, within the previously approved project budget, so that the
third-party commissioning agent can perform the services above, as well as perform early
design reviews. These design reviews will allow the project to start drafting a Commissioning
Plan and is also one of the commissioning requirements for the project to apply for Leadership
in Energy and Environmental Design (LEED) Silver (or higher) certification. 

Template revised January 10, 2019.

COMMISSION AGENDA  Action Item No. 8c                                   Page 2 of 5 
Meeting Date: March 8, 2022 

Commissioning the systems and equipment provided as part of the C Concourse Expansion
project ensures they perform as intended and designed before the project is complete and put
into operation.  The project is also pursuing LEED credits that require use of commissioning
services. Independent third-party commissioning services are also required by building code to
validate the performance of life-safety systems on larger capital projects such as C Concourse
Expansion.  Procurement needs to begin now, during the early design phase,  so that a 
Commissioning Agent can perform LEED required design reviews and start development of prefunctional
checklists and the overall Commissioning Plan prior to the start of major on-site 
Diversity in Contracting 
The project team has worked with the Diversity in Contracting team to conduct outreach and
the setting of a women- and minority-owned business enterprise (WMBE) aspirational goal of
Over the last decade, leasable space post-security at the Airport has become almost nonexistent
due to the continued growth of airlines and tenants' operational and administrative
needs. Staff has identified the C Concourse Expansion Building area as a key location where the
terminal can be expanded without the consumption of additional real estate (building up rather
than out).  There are no other viable options for expanding the terminal without significant
negative impacts to existing capacity or operational areas. 
The C Concourse Expansion Project will grow Airport Dining and Retail (ADR) services with two
floors of new space. This additional square footage will provide a higher level of service to
travelers and generate additional non-aeronautical revenue. The remaining three new floors
will provide space for two new premium lounges and additional office space. The office space
will serve to support existing tenants, airlines, and Transportation Security Administration (TSA)
in addition to creating support space for the new C Concourse Expansion ADR spaces. The Port
of Seattle has received general a positive Majority-In-Interest (MII) vote from the airlines and
letters of interest for the lounge level spaces. 
The C Concourse Expansion Building is an existing three-level structure that was built to house
the C Concourse Expansion in-line baggage screening system (on the baggage claim and bridge
levels) that supports Alaska Airlines. The current C Concourse Expansion Building houses the
TSA in much of the concourse level space, which would be better utilized for publicly accessible
services and amenities. As part of this project, the TSA functions will be relocated to make way
for higher and better uses. 

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

COMMISSION AGENDA  Action Item No. 8c                                   Page 3 of 5 
Meeting Date: March 8, 2022 
Beyond being one of the few locations for the Airport to expand its footprint without further
encroaching on limited real estate, this will be the first project to utilize the Environmental
Sustainability Framework adopted by the Commission, and a great opportunity to embody the
new SEA brand. 

Scope of Work 
The scope of work for the commissioning services provided in this Service Agreement will
include design review followed by  verification  and documentation  that the systems and
equipment delivered as part of the C Concourse Expansion project are fully functioning in
accordance with the contract documents, LEED goals, and applicable building and fire codes.
Commissioning services will also validate that Port personnel are trained to operate, maintain, 
and troubleshoot equipment and systems provided as part of the project. 
Commission design authorization               2020 Quarter 2 
Design start                                       2021 Quarter 1 
Commission construction authorization (MAC)   2022 Quarter 4 
Construction start (enabling work packages)     2021 Quarter 2 
In-use date                                       2027 Quarter 2 
Cost Breakdown                                     This Request           Total Project 
Design                                                  $1,500,000            $51,000,000 
Construction                                                     $0          $289,000,000 
Total                                                         $1,500,000           $340,000,000 

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

COMMISSION AGENDA  Action Item No. 8c                                   Page 4 of 5 
Meeting Date: March 8, 2022 
Alternative 1  Utilize an existing Indefinite Delivery Indefinite Quantity (IDIQ) Contract for
Commissioning Services 
Cost Implications: $1,500,000 
(1)   No procurement required 
(2)   Meets code requirements 
(1)   No current IDIQ's exist with available capacity for this work. 
(2)   C Concourse Expansion commissioning needs would utilize a large percentage of any
available IDIQ, should one exist, limiting use by other projects. 
(3)   Current IDIQs expire prior to the project being complete requiring use of a second
IDIQ, and potentially a different Commissioning Agent, to finish the project. 
This is not the recommended alternative. 
Alternative 2  Procure a project specific Commissioning Agent Service Agreement 
Cost Implications: $1,500,000 
(1)   Meets code requirements 
(2)   Service Agreement duration can match project duration 
(3)   Single agent for the duration of the project 
(1)   Procurement of a new Service Agreement takes longer than other alternatives 
This is the recommended alternative. 
Cost Estimate/Authorization Summary              Capital        Expense           Total 
Original estimate                               $331,776,000      $8,224,000   $340,000,000 
Previous authorizations                         $84,674,000      $7,926,000     $92,600,000 
Current request for authorization                $1,500,000               $0      $1,500,000 
Total authorizations, including this request      $86,174,000      $7,926,000     $94,100,000 
Remaining amount to be authorized          $245,602,000       $298,000   $245,900,000 

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

COMMISSION AGENDA  Action Item No. 8c                                   Page 5 of 5 
Meeting Date: March 8, 2022 
Annual Budget Status and Source of Funds 
This project is included in the 2022-2026 capital budget and plan of finance with a budget of
$340,000,000. The capital budget decrease of $8,224,000 would be transferred to the
Aeronautical Allowance CIP C800753. The expense budget would be included in the Aviation
Division's annual operating expense budget. The funding sources will include the Airport
Development Fund and future revenue bonds. This project was approved by airlines through a
Majority-In-Interest (MII) vote in April 2021. 
Financial Analysis and Summary 
Project cost for analysis              $340,000,000 
Business Unit (BU)                  Terminal Building 
Effect on business performance     NOI after depreciation will increase due to inclusion of
(NOI after depreciation)             capital (and operating) costs in airline rate base. 
IRR/NPV (if relevant)                NPV (40 years) for non-aero $44.5 million 
CPE Impact                       $0.68 in 2028 
Future Revenues and Expenses (Total cost of ownership) 
As presented on April 27, 2021, when completed the project will generate incremental nonairline
revenues of $12 million by 2028 and over $15 million by 2031.  Aeronautical revenues
will also increase as the allocated operating and capital costs (debt service) are included in
airline terminal rate base. 
April   27,   2021      C1   Building   Project   Additional   Design   and   General
Contractor/Construction Manager Early Work Authorization  Special Inspection and
Testing Authorization 
May 26, 2020  C1 Building Project Design and General Contractor/Construction
Manager Authorization 
March 10, 2020  C1 Building Project Briefing and Introduction 
June 26, 2018  C1 Building Project Authorization for Planning Funds 
January 26, 2016  The Commission authorized design of an expansion for the existing
Gate C3 passenger Holdroom at Seattle-Tacoma International Airport. 
July 11, 2017  The Commission authorized (1) advertise and execute a construction
contract for the Gate C3 Holdroom Expansion project at Seattle-Tacoma International
Airport; and (2) use Port crews in executing the project 

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

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