8i. Memo
Sanitary Pipe Replacement
COMMISSION AGENDA MEMORANDUM Item No. 8i ACTION ITEM Date of Meeting March 14, 2023 DATE: March 3, 2023 TO: Stephen P. Metruck, Executive Director FROM: Keri Stephens, Director, Aviation Facilities and Capital Programs Eileen Francisco, Director, Aviation Project Management SUBJECT: Sanitary Pipe Replacement (CIP# C801239) – Design Authorization Amount of this request: $600,000 Total estimated project cost: $3,000,000 ACTION REQUESTED Request Commission authorization for the Executive Director to (1) increase the project budget by $1,000,000 for a revised total budget of $3,000,000; (2) prepare design and construction bid documents for the Sanitary Pipe Replacement project. The amount of this request is $600,000 for an estimated total project cost not to exceed $3,000,000. EXECUTIVE SUMMARY Sanitary waste pipes serving multiple SEA areas are at or near end-of-life (typically 30 years). This project replaces or relines waste pipes. Failures result in unscheduled shutdown of airport restrooms, restaurants, and tenant spaces which will directly impact passenger experience and tenant operations. Leakage and spills from failed pipes may result in health hazards to the public and airport workers as some waste pipes are routed over occupied spaces. Since the preliminary budget was developed (2020) we have seen rising material costs, increased labor rates, increased abatement scope, and escalation, resulting in an additional $1,000,000 needed to complete the work. JUSTIFICATION Failure of sanitary waste piping is often sudden, unexpected, and impossible to predict. Sanitary waste pipe failures result in unscheduled emergency repairs which cause unscheduled shutdowns of airport restrooms, restaurants, and tenant owned spaces. This directly impacts customer experience and tenant operations. This project replaces the sanitary waste piping identified as a risk if not replaced. Template revised January 10, 2019. COMMISSION AGENDA – Action Item No. 8i Page 2 of 4 Meeting Date: March 14, 2023 Diversity in Contracting The design services will be completed using an existing IDIQ contract that was established in 2022 which has a 16% WMBE participation utilization requirement. DETAILS Scope of Work Replace, or reline failing sanitary waste piping on Concourse A, Main Terminal, and Central Terminal (2 locations). (1) A Concourse - Work will result in temporary closures to restrooms and tenant spaces on concourse level. Scope includes approximately 350 linear feet of sewer pipe work. 210 linear feet will replace existing cast iron pipe with new stainless-steel piping and 150 linear feet of buried pipe will be cast-in-place pipe linear. (2) Main Terminal – Pipe located in mechanical room 4 (under baggage claim 15 area). Approximately 250 linear feet pipe will be replaced from cast iron to stainless-steel. (3) Central Terminal South – Approximately 250 linear feet of sanitary pipe serving TSA locker rooms (Men/Women) with some central terminal concourse concessions. 55 linear feet of this will be replacing cast iron piping with stainless-steel, and 200 linear feet of this will be cast-in-place pipe. (4) Central Terminal North – Approximately 230 linear feet of Sanitary pipe serving concourse level restrooms and concessions. 30 linear feet of this will be replacing cast iron piping with stainless-steel, and 200 linear feet of this will be cast-in-place pipe. Schedule Activity Design complete Q2 2024 Commission construction authorization Q2 2024 Construction award Q4 2024 Substantial completion Q2 2026 Cost Breakdown This Request Total Project Design $600,000 $650,000 Construction $0 $2,350,000 Total $600,000 $3,000,000 ALTERNATIVES AND IMPLICATIONS CONSIDERED Alternative 1 – Status Quo. Do not proceed with project. Cost Implications: Expense approximately $35,000 for notebook development costs. Pros: (1) Delays or defers capital investment. Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8i Page 3 of 4 Meeting Date: March 14, 2023 Cons: (1) Sanitary pipe failures could occur at any time resulting in large expense costs for emergency repairs and shutdowns to restrooms, concessions and other tenant owned spaces. (2) Potential for additional increase in costs for materials, labor, and/or inflation. This is not the recommended alternative. Alternative 2 – Replace, or reline failing sanitary waste piping on Concourse A, Main Terminal, and Central Terminal (2 locations). Cost Implications: $2,935,000 in capital costs and $65,000 in expense costs Pros: (1) Provides an additional 15-50 years of sanitary pipe life, resulting in less unexpected shutdowns and emergency repairs. (2) Reduces potential negative risk to passenger experience by limiting shutdowns of concessions and restrooms. (3) Replaces aging infrastructure in a timely manner. Cons: (1) Capital and expense costs. This is the recommended alternative. FINANCIAL IMPLICATIONS Cost Estimate/Authorization Summary Capital Expense Total COST ESTIMATE Original estimate $2,000,000 $0 $2,000,000 Current change $935,000 $65,000 $1,000,000 Revised estimate $2,935,000 $65,000 $3,000,000 AUTHORIZATION Previous authorizations $50,000 $0 $50,000 Current request for authorization $600,000 $0 $600,000 Total authorizations, including this request $650,000 $0 $650,000 Remaining amount to be authorized $2,285,000 $65,000 $2,350,000 Template revised June 27, 2019 (Diversity in Contracting). COMMISSION AGENDA – Action Item No. 8i Page 4 of 4 Meeting Date: March 14, 2023 Annual Budget Status and Source of Funds This project C801239 was included in the 2023-2027 capital budget and plan of finance with a budget of $2,000,000. The capital budget increase of $935,000 was transferred from the Aeronautical Allowance CIP C800753 resulting in no net change to the Airport capital budget. The funding sources will be the Airport Development Fund and future revenue bonds. Financial Analysis and Summary Project cost for analysis $3,000,000 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) N/A CPE Impact $0.01 in 2026 Future Revenues and Expenses (Total cost of ownership) As a result of this project, Aviation Maintenance may see a small increase in preventative maintenance support. ATTACHMENTS TO THIS REQUEST (1) Presentation Slides PREVIOUS COMMISSION ACTIONS OR BRIEFINGS None Template revised June 27, 2019 (Diversity in Contracting).
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