8h. Memo
2023 Airfield Projects
COMMISSION AGENDA MEMORANDUM Item No. 8h ACTION ITEM Date of Meeting October 25, 2022 DATE: October 18, 2022 TO: Stephen P. Metruck, Executive Director FROM: Eileen Francisco, Director Aviation Project Management Laurel Dunphy, Director Airport Operations Matt Breed, ICT Chief Information Officer SUBJECT: 2023 Airfield Projects (CIP# C800930, C801177, C800844, C801237, C801171) Amount of this request: $67,153,000 Total estimated cost of projects: $255,945,000 ACTION REQUESTED Request Commission authorization for 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; (5) increase the budget for the Perimeter Intrusion Detection System Program by $5,400,000 for a total project budget of $34,045,000; and (6) increase the budget for the Secured Area Vehicle Checkpoint Project by $400,000 for a total project budget of $4,700,000. 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. EXECUTIVE SUMMARY These two construction contracts are comprised of multiple interdependent Capital Improvement Projects (CIP). These projects have overlapping work areas and design functionality, interdependent operational impacts, and share 2023 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. Construction Contract #1 encompasses federally funded pavement and utility infrastructure while Construction Contract #2 consist of all other airfield project work in 2023. Template revised January 10, 2019. COMMISSION AGENDA – Action Item No. 8h Page 2 of 13 Meeting Date: October 25, 2022 The below table details the CIPs and corresponding authorizations requested. The total estimated project cost for each CIP is also included. Total authorizations to date for each of these CIP is included in the Financial Implications section of this memo. CIP Name/# Amount of this Request Total Estimated Project Cost 2021-2025 Airfield Pavement and Supporting $27,700,000 $153,500,000 Infrastructure Replacement Program C800930 Airfield Utility Improvements C801177 $4,600,000 $46,200,000 Perimeter Intrusion Detection System C800844 $23,200,000 $34,045,000 Snow Storage Expansion C801171 $7,553,000 $17,500,000 Secured Area Vehicle Checkpoint Project $4,100,000 $4,700,000 C801237 Total $67,153,000 $255,945,000 JUSTIFICATION The collection of projects being co-delivered via the 2023 Airfield Construction Contracts 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 purpose of each project (CIP) 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. • The Perimeter Intrusion Detection System (PIDS) project will enhance the airport perimeter security to ensure public safety and improve operational efficiencies through use of technology and automation. PIDS will also provide power and communication infrastructure in currently undeveloped areas around the airport security perimeter. The additional budget ask is driven by the following: o Design evolution and additional scope items o Integration of Utility Master Plan elements o Department of Revenue ruling o Construction inflation • The Snow Storage Expansion project increases snow storage capacity which will meet the operational and FAA certification needs, based on historical snow events. Snow storage meltwater will flow to the Industrial Wastewater System (IWS), meeting regulatory requirements. Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8h Page 3 of 13 Meeting Date: October 25, 2022 The Secured Area Vehicle Checkpoints Project (SAVCP) will provide the infrastructure and equipment required to support the overall security posture at the airport. The two vehicle checkpoints will provide the bookends that will secure the terminal area. The additional budget ask is primarily driven by design evolution. Diversity in Contracting The project staff, in coordination with the Diversity in Contracting Department, have set goals for both contracts. Airfield Contract #1 is federally funded work and will include an 8% Disadvantaged Business Enterprises (DBE) goal. Contract #2 is not federally funded and as such will include a 14% Woman and Minority Business Enterprise (WMBE) aspirational goal. These goals are based upon the projects’ scopes of work, and baseline availability of certified DBE and WMBE businesses to perform the work under the two separate contracts. 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 2023 includes taxilane pavement and drainage work at A, D, and S Concourses, extension of a mid-airfield power ductbank, and installation of over height vehicle warning bars to protect the Runway 16R FAA approach lighting system. 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 2023 AUI scope is located on the airside of the S and A Concourses and includes sanitary sewer, domestic water, power, and the Industrial Wastewater System (IWS). Staff will procure long lead items including ductile iron and PVC pipes for sewer, water system and IWS. The PIDS project will install power and communication infrastructure and deploy technology to monitor, track, and rapidly respond to security threats along the identified airfield perimeter. The infrastructure components of this project are collocated and interdependent with the work elements within the other 2023 Airfield projects. The Snow Storage Expansion project expands the laydown area available for stockpiling and managing snow on the airfield during winter storm events. Airfield work under this program in 2023 includes expansion and infrastructure improvements of the existing north and south snow Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8h Page 4 of 13 Meeting Date: October 25, 2022 storage areas, as well as widening of the perimeter roadway for safe transit of snow removal equipment. The SAVCP will add vehicle gate arms and security screening equipment at the north and south ends of the terminal secured area to ensure that only approved vehicles have access to that area of the airfield. Schedule Activity Construction Contract # Contract #1 Contract #2 Commission construction authorization 2022 Quarter 4 2022 Quarter 4 Construction starts 2023 Quarter 2 2023 Quarter 1 In-use date 2023 Quarter 4 2023 Quarter 4 Cost Breakdown This Request Total Project 2021-2025 Airfield Pavement and Supporting Infrastructure Replacement Prog. (C800930) Design $0 $16,000,000 Construction $27,700,000 $137,500,000 Total $27,700,000 $153,500,000 Airfield Utility Improvements (C801177) Design $0 $6,595,200 Construction $4,600,000 $39,604,800 Total $4,600,000 $46,200,000 Perimeter Intrusion Detection System (C800844) Design $400,000 $3,025,000 Construction $22,175,000 $22,875,000 Technology $625,000 $8,145,000 Total $23,200,000 $34,045,000 Snow Storage Expansion (C801171) Design $0 $2,794,000 Construction $7,553,000 $14,706,000 Total $7,553,000 $17,500,000 Secured Area Vehicle Checkpoint (C801237) Design $0 $600,000 Construction $4,100,000 $4,100,000 Total $4,100,000 $4,700,000 ALTERNATIVES AND IMPLICATIONS CONSIDERED Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8h Page 5 of 13 Meeting Date: October 25, 2022 Alternative 1 – Proceed only with federally funded 2023 Contract #1 Airfield work including: the Airfield Pavement and Supporting Infrastructure Replacement Program and the Airfield Utility Improvements. Do not proceed with the project scope in 2023 Contract #2 including extension of a mid-airfield power ductbank, installation of over height vehicle damage protection bars, installation of secured area vehicle checkpoints, expansion of snow storage area, and installation of PIDS infrastructure and technology. Cost Implications: $28,369,000 in Capital Cost for 2023 Contract #1 plus $5,381,000 in unanticipated expense cost for the uncompleted 2023 Contract #2 projects. Pros: (1) Reduced capital spending in 2023. (2) Less construction impacts to airport/airline operations in 2023. (3) Grant funded renewal and replacement work still proceeds. Cons: (1) Risk of damaging Runway 16R FAA approach lighting system by over height vehicles, future repairs will likely include replacing sections of the bridge, causing significant impacts to airfield operations. (2) No ability to provide continuous 24/7/365 monitoring, real-time alerting, identification and coordinated response to intrusion(s). Higher operating cost for additional FTE and increased vehicle maintenance due to increased patrols. (3) Unable to achieve the Aviation Master Security Plan goals and objectives. (4) Continuing concern for the Airport’s National Pollutant Discharge Elimination Systems (NPDES) permit noncompliance when snow is stored outside of the IWS basin. (5) Regulatory compliant snow storage within IWS basins will need to displace aircraft positions. This is not the recommended alternative. Alternative 2 – Construct each individual project with separate construction contracts. Cost Implications: The Estimated amount of additional capital costs for delivering the projects by individual construction contracts is $4,500,000 more than delivering via two major construction contracts as propped by the recommended alternative. Pros: (1) Less complexity for budget tracking during construction. Cons: (1) Reduced efficiencies due to rework and multiple, separate jurisdictional coordination such as the FAA. (2) Additional labor costs for contracting on-boarding and mobilizations, multi-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. Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8h Page 6 of 13 Meeting Date: October 25, 2022 This is not the recommended alternative. Alternative 3 – Move forward to construct all 7 projects as a single coordinated effort. Cost Implications: $67,153,000 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. Ensures regulatory compliance and adaption of full employee screening of the terminal area, in addition to meeting AV Security goals and objectives. (4) Snow storage capacity increases, and meltwater will flow to the IWS, meeting regulatory requirements, while reducing annual operating costs. (5) Mitigate the risk of the FAA’s approach lighting system being struck by over height vehicles. Cons: (1) Earlier capital spending in 2023. (2) Additional accounting complexity during construction. This is the recommended alternative. FINANCIAL IMPLICATIONS 2021-2025 Airfield Pavement and Supporting Infrastructure Replacement Program (C800930) - Cost Estimate/Authorization Summary COST ESTIMATE Capital Expense Total Original estimate $155,740,000 $560,000 $156,300,000 Previous changes – net ($2,800,000) $0 ($2,800,000) Revised estimate $152,940,000 $560,000 $153,500,000 AUTHORIZATION Previous authorizations $78,935,000 $260,000 $79,195,000 Current request for authorization $27,600,000 $100,000 $27,700,000 Total authorizations, including this request $106,535,000 $360,000 $106,895,000 Remaining amount to be authorized $46,405,000 $200,000 $46,605,000 Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8h Page 7 of 13 Meeting Date: October 25, 2022 Airfield Utility Improvements (C801177) - Capital Expense Total Cost Estimate/Authorization Summary COST ESTIMATE Original estimate $34,592,000 $0 $34,592,000 Current change $11,608,000 $0 $11,608,000 Revised estimate $46,200,000 $0 $46,200,000 AUTHORIZATION Previous authorizations $6,595,200 $0 $6,595,200 Current request for authorization $4,600,000 $0 $4,600,000 Total authorizations, including this request $11,195,200 $0 $11,195,200 Remaining amount to be authorized $35,004,800 $0 $35,004,800 Perimeter Intrusion Detection System Capital Expense Total (C800844) - Cost Estimate/Authorization Summary COST ESTIMATE Original estimate $10,000,000 $10,000,000 Previous changes – net $18,500,000 $145,000 $18,645,000 Current change $5,300,000 $100,000 $5,400,000 Revised estimate $33,800,000 $245,000 $34,045,000 AUTHORIZATION Previous authorizations $10,000,000 $145,000 $10,145,000 Current request for authorization $23,100,000 $100,000 $23,200,000 Total authorizations, including this request $33,100,000 $245,000 $33,345,000 Remaining amount to be authorized $700,000 $0 $700,000 Snow Storage Expansion (C801171) - Cost Capital Expense Total Estimate/Authorization Summary COST ESTIMATE Original estimate $17,500,000 $0 $17,500,000 Previous changes – net $0 $0 $0 Current changes - net -$50,000 $50,000 $0 Revised estimate $17,450,000 $50,000 $17,500,000 AUTHORIZATION Previous authorizations $2,794,000 $0 $2,794,000 Current request for authorization $7,553,000 $50,000 $7,603,000 Total authorizations, including this request $10,347,000 $50,000 $10,397,000 Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8h Page 8 of 13 Meeting Date: October 25, 2022 Remaining amount to be authorized $7,103,000 $0 $7,103,000 Secured Area Vehicle Checkpoint Project Capital Expense Total (C801237) - Cost Estimate/Authorization Summary COST ESTIMATE Original estimate $1,800,000 $0 $1,800,000 Previous changes – net $2,500,000 $0 $2,500,000 Current change $350,000 $50,000 $400,000 Revised estimate $4,650,000 $50,000 $4,700,000 AUTHORIZATION Previous authorizations $600,000 $0 $600,000 Current request for authorization $4,050,000 $50,000 $4,100,000 Total authorizations, including this request $4,650,000 $50,000 $4,700,000 Remaining amount to be authorized $0 $0 $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 2022-2026 capital budget and plan of finance with a budget of $152,940,000. 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. Airfield Utilities Improvements (AUI) - (CIP C801177) This project was included in the 2022-2026 capital budget and plan of finance with a budget of $46,200,000. This project has a Majority-In-Interest approval from the airlines in September 2021. The funding sources would be Airport Development Fund and Airport Revenue Bonds. Perimeter Intrusion Detection System (PIDS) – (CIP 800844) This project was included in the 2022-2026 capital budget and Plan of Finance for $28,500,000. The capital budget increase of $5,300,000 was transferred from the Aeronautical Allowance #C800753 ($3,650,000) and the Utility Master Plan Allowance #C801267 ($1,650,000) resulting in zero net change to the Aviation capital budget. The funding sources would be Airport Development Fund and Airport Revenue Bonds The additional $245,000 expense budget for training will be budgeted in 2023 - 2024. This project has a Majority-In-Interest (MII) approval from the airlines on March 28, 2019 in the Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8h Page 9 of 13 Meeting Date: October 25, 2022 amount of $10 million. Per Signatory Lease Operating Agreement, Port Management has the discretion to utilize the MII Management Reserve for the budget increase. Snow Storage Expansion - (CIP C801171) This project was included in the 2022-2026 capital budget and plan of finance with a budget of $17,500,000. The funding sources would be Airport Development Fund and revenue bonds. This project has a Majority-In-Interest (MII) approval from the airlines on October 20, 2021. Secured Area Vehicle Checkpoints (SAVCP) - (CIP C801237) Included in the 2022-2026 capital budget and plan of finance with a budget of $1,800,000. A budget increase of $2,500,000 was transferred from the Aeronautical Reserve CIP C800753 resulting in zero net change to the Aviation capital budget. The funding sources would be Airport Development Fund and revenue bonds. Financial Analysis and Summary C800930 2021-2025 Airfield Pavement and Supporting Infrastructure Replacement Program Project cost for analysis $153,500,000 Business Unit (BU) Airfield movement and Airfield apron 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) N/A CPE Impact Total project cost CPE of 0.30 in 2026; annual CPE of .05 C801177 Airfield Utility Improvements Project cost for analysis $46,200,000 Business Unit (BU) Airfield movement and airfield apron 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) N/A CPE Impact $0.11 in 2026 C800844 Perimeter Intrusion Detection System Project cost for analysis $34,045,000 Business Unit (BU) Airfield Movement Area 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) N/A CPE Impact $0.11 in 2025 Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8h Page 10 of 13 Meeting Date: October 25, 2022 C801171 Snow Storage Expansion Project cost for analysis $17,500,000 Business Unit (BU) Airfield Movement Area 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) N/A CPE Impact $0.06 in 2025 C801237 Secured Airfield Vehicle Checkpoint Project cost for analysis $4,700,000 Business Unit (BU) Airfield Movement Area 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) N/A CPE Impact $0.01 in 2025 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. Perimeter Intrusion Detection System (PIDS) – (CIP 800844) Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8h Page 11 of 13 Meeting Date: October 25, 2022 Annual recurring maintenance and license costs estimated at $140,000, will be budgeted in the Aviation Maintenance operating budget. Port support and spare parts are estimated at $230,000 annually and will be budgeted in the Aviation Maintenance operating budget. Snow Storage Expansion (CIP C801171) Aviation Maintenance will see a slight increase in O&M cost for additional pavement surface. However, mechanical and electronic systems will have a renewed asset life with fewer outages and repairs. Secured Area Vehicle Checkpoints (SAVCP) - (CIP C801237) Aviation Maintenance will see a slight increase in O&M cost for Electrical and Electronic systems, to maintain cameras and access controls and lighting. Mechanical systems maintenance will be required for HVAC for the spaces. Labor hours and materials required will be determined when presented with a clearer scope during the design phase of the project. ATTACHMENTS TO THIS REQUEST (1) Presentation slides PREVIOUS COMMISSION ACTIONS OR BRIEFINGS 2021-2025 Airfield Pavement and Supporting Infrastructure Replacement Program (CIP C800930) 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 agreement for the replacement of distressed pavements and supporting infrastructure for the 2021 portion of Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8h Page 12 of 13 Meeting Date: October 25, 2022 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. Airfield Utilities Infrastructure (AUI) - (CIP C801177) August 10, 2021 – The Commission authorized the Executive Director to (1) complete design and prepare construction documents for the Airfield Utilities Infrastructure (AUI) project at Seattle-Tacoma International Airport (SEA) and (2) enter into reimbursable agreements with the Federal Aviation Administration. This design authorization is for an amount of $6,300,000 out of a total estimated project cost of $46,200,000. Perimeter Intrusion Detection System (PIDS) – (CIP 800844) May 24, 2022 – The Commission authorized the Executive Director to increase the Perimeter Intrusion Detection System (PIDS) with Siemens, contract #S-00319688 by $374,000 to procure hardware, professional and installation services to ensure PIDS redundancy. December 15, 2020 – The Commission authorized the Executive Director to (1) increase the Perimeter Intrusion Detection System (PIDS) project at Seattle-Tacoma International Airport (SEA) funding by $18,645,000 for a total estimated project cost of $28,645,000; (2) expand the PIDS coverage area; (3) execute contracts for required hardware, software, and technical vendor services, license(s) and maintenance; (4) complete design (5) enter into reimbursable agreements with the Federal Aviation Administration (FAA); and (6) execute contract(s) for up to ten years for licenses, service, and maintenance fees estimated not-to-exceed $4,500,000, which will be paid from the Aviation annual operating budget. The amount requested under this authorization is $6,625,000 with an estimated total program cost of $28,645,000. January 22, 2019 – The Commission authorized $3,500,000 of a $10,000,000 CIP to procure and implement a Perimeter Intrusion Detection system with limited coverage scope. Snow Storage Expansion (CIP C801171) October 26, 2021 – The commission authorized the Executive Director to design and prepare construction documents for the Snow Storage Expansion project at Seattle-Tacoma International Airport (SEA) for a Total Request Amount of $2,500,000 and a Total Project Authorization of $2,794,000, and the Estimated Overall Project Cost of $17,500,000. Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8h Page 13 of 13 Meeting Date: October 25, 2022 Secured Area Vehicle Checkpoints (SAVCP) - (CIP C801237) February 8, 2022 – The Commission authorized the Executive Director to design and prepare construction documents for the Secured Area Vehicle Checkpoints (SAVCP) project at Seattle- Tacoma International Airport (SEA) for $550,000 out of an estimated total project cost of $4,300,000. Template revised June 27, 2019 (Diversity in Contracting).
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