PORT OF SEATTLE 
MEMORANDUM 
COMMISSION AGENDA               Item No.      4d 
ACTION ITEM 
Date of Meeting     August 4, 2015 
DATE:    July 27, 2015 
TO:      Ted Fick, Chief Executive Officer 
FROM:   Wayne Grotheer, Director, Aviation Project Management Group 
James Schone, Director, Aviation Business Development 
SUBJECT:  Regulated Materials Abatement to Support Airport Tenant Construction Projects
(Expense) 
Amount of This Request:        $1,800,000   Source of Funds:   Airport Development
Fund 
Est. Total Project Cost:          $1,800,000 
Est. State and Local Taxes:        $127,000 
ACTION REQUESTED 
Request Commission single authorization for the Chief Executive Officer to design, advertise for
construction, bid and award a construction contract to abate regulated materials in support of
tenant construction projects in the Main Terminal at Seattle-Tacoma International Airport. The
total estimated cost of this project is $1,800,000. 
SYNOPSIS 
Alaska Airlines (Alaska) and Delta Air Lines (Delta) have requested to add new leased space at
the Airport in four different locations of the Main Terminal. Staff identified three vacant spaces
and one soon to be vacant space that meet their needs. Each of the proposed spaces contains
regulated materials that must be abated or removed before tenant improvement construction can
take place. Consistent with Port policy, the tenants pay for their tenant improvements while the
Port pays for the costs relating to the abatement of regulated materials. Upon completion of these
tenant projects, the Port will realize annual rent from previously vacant space of approximately
$1.6 million beginning in 2017.The cost of the abatement, which was not anticipated in the 2015
budget, will be accounted for as an operating expense and recovered through terminal rents. Staff
estimates that approximately $900,000 will be recognized as an expense in 2015, of which 77 
percent will be recovered through increased terminal rents. 
BACKGROUND 
Both Alaska and Delta have experienced continued growth at the Airport throughout 2015 and
require additional space to accommodate their operations. Airport-wide, passenger enplanements
grew 7.7 percent in 2014 and yearly totals for this year continue to grow at a double digit rate
exceeding 13 percent. Suitable lease space for tenants to expand their operations in the Main

Template revised May 30, 2013.

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
July 27, 2015 
Page 2 of 6 
Terminal is becoming increasingly scarce. Four such locations have been identified that are
shown on the graphics that accompany this memo. None of these locations is suitable for dining
and retail development. 
Alaska proposes to complete the following work: 
Remodel the vacant office space behind their self-check-in/bag drop operation at the far
north end of the ticket lobby 
Remodel vacant space on Concourse D 
Remodel vacant space at the north end of the Main Terminal Mezzanine 
Delta proposes to complete the following work: 
Remodel the current US Airways ticket counter and offices after it is vacated when US
Airways co-locates with American Airlines in Q4 2015 
These locations are shown on the attached graphic. 
Regulated materials, primarily asbestos-containing spray-applied fire-proofing, are present at
each of the locations described above. In order to remove the risk of accidental exposure to these 
hazardous materials, the complete removal of these materials is required before construction or
remodeling work by the tenant can take place. The Port has completed initial surveys of these
materials in order to prepare a project plan to complete the abatement work in each of these
locations. 
The regulated material abatement design will be performed by Port Construction Services (PCS)
and the actual abatement work will be performed via a Project Specific Major Works Open
Order contract. The remodeling work in each location will be performed as tenant improvement
projects by each tenant at its expense. 
PROJECT JUSTIFICATION AND DETAILS 
Suitable alternate lease space that has already been abated is not available in the Main Terminal.
Each of identified locations requires some level of remodel or tenant improvements in order to
best suit the tenants' needs. Thus regulated materials must be abated before the tenants can
complete their planned tenant improvements. 
Project Objectives 
Project objectives include: 
Complete abatement of regulated materials in advance of construction activities by each
tenant. 
Complete abatement of regulated materials inside each of the spaces now so that
continued management of them is no longer required.

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
July 27, 2015 
Page 3 of 6 
As passenger enplanements continue to increase at the Airport, leading to increased demand for
leasable space to support the growth in operations, it is important that we first look to optimize
existing space before undertaking new construction. It is less expensive to abate and remodel
than to build new facilities, which can be difficult to site on the small footprint of the Airport.
This proposed abatement work will allow each tenant to remodel and reconfigure each location
into spaces nearby to the airline operations that will be much better suited to meet their growing
operations. 
Scope of Work 
Prepare a project to complete regulated materials abatement in the identified locations to include: 
Develop abatement scope and design for each proposed project location 
Advertise and execute a Project Specific Major Works Open Order procurement for
regulated materials abatement 
Abate regulated materials identified at each project location 
Provide wall and floor penetrations at each project location as required 
Provide all required oversight and monitoring for this abatement work 
Schedule 
Activity                                           Dates 
Complete Design                           3rd Quarter 2015 
Abatement Contract Executed                    4th Quarter 2015 
Complete Abatement Work                     4th Quarter 2016 
Tenant Construction Work                 1st Quarter 2016  1st Quarter 2017 
FINANCIAL IMPLICATIONS 
Budget/Authorization Summary              Capital     Expense   Total Project 
Current Budget                            $0    $1,800,000    $1,800,000 
Previous Authorizations                       $0          $0          $0 
Current request for authorization                  $0    $1,800,000    $1,800,000 
Total Authorizations, including this request           $0    $1,800,000    $1,800,000 
Remaining budget to be authorized               $0          $0          $0 
Total Estimated Project Cost                    $0    $1,800,000    $1,800,000 
Project Cost Breakdown                         This Request and Total Project 
Design                                                   $94,000 
Construction (Abatement)                                     $1,579,000 
State & Local Taxes (estimated)                                   $127,000 
Total                                                      $1,800,000

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
July 27, 2015 
Page 4 of 6 
Budget Status and Source of Funds 
The 2015 operating budget included $2,642,000 for Regulated Materials Mitigation expenses.
Funding for this work was not included in the 2015 Environmental Remediation Liability (ERL)
Program. All costs will be accounted for as environmental remediation liabilities and charged as
operating expense in accordance with Port Policy AC-9. Staff anticipates that approximately
$900,000 of the costs will be incurred in 2015 with the remainder in 2016. Staff will strive to
absorb the 2015 costs within the approved budget through savings in other areas. The source of
funds is the Airport Development Fund. 
Financial Analysis and Summary 
Project Type              Environmental Project, Expense 
Risk adjusted discount rate     N/A 
Key risk factors             N/A 
Project cost for analysis        $1,800,000 
Business Unit (BU)          Terminal Building 
Effect on business performance  Approximately 77% of the abatement costs will be
recovered in the airline rate base in 2015 and 2016.
Additionally, upon completion, rent from previously
vacant office space (9,439 square feet) will result in
increased rent of approximately $1.6 million annually
beginning in 2017.
IRR/NPV             N/A 
CPE Impact             Approximately $.04 in 2015 and $.03 in 2016 
Lifecycle Cost and Savings 
This expense project will remove asbestos-containing fireproofing and other regulated materials
throughout the proposed lease locations. Although there is a short-term cost associated with this
work, maximizing the project footprint and removing as much material as possible in a single
Open Order contract minimizes the unit and overall costs for abatement. This would be the most
cost effective way to perform the abatement in support of the identified tenant projects.
The risks associated with leaving the regulated materials in place include inadvertent exposure to
workers, staff and general public during any remodel work. This risk would also be present for
any future construction projects and any maintenance work needing to be completed in these
areas. 
Even if the tenants accepted each space as-is, spot abatement of regulated materials at multiple
locations throughout each of the identified locations would be necessary to support each tenant's
proposed remodeling work. Revisions to the heating, ventilation and air conditioning ductwork
and associated components as well as wall, door and window configurations, lighting and ceiling
systems will likely be required. A regulated materials abatement contractor would first have to
spot abate and prepare each location for work by other trades, which slows up the construction

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
July 27, 2015 
Page 5 of 6 
schedule and over time is more costly than abating the entire space. In an area that has been fully
abated the ongoing costs associated with spot abatement are eliminated. 
STRATEGIES AND OBJECTIVES 
This project aligns with the Port's Century Agenda strategy of advancing the region as a leading
tourism destination and business gateway by providing improved facilities to support our airline
partners as they expand operations at the Airport.
ENVIRONMENTAL SUSTAINABILITY 
This project demonstrates the Port's commitment to environmental stewardship and the Century
Agenda strategic objective to be the greenest and most energy efficient port in North America by
removing regulated materials from the airport.
ALTERNATIVES AND IMPLICATIONS CONSIDERED 
Alternative 1)  Perform no regulated materials abatement in the identified locations. Tenants
make use of these spaces as-is. No remodel or tenant improvements would be allowed. 
Project Cost:  $0 for the Port/Unknown for Tenants 
Pros: 
Each tenant would theoretically be able to occupy the proposed spaces immediately as-is. 
The Port would not incur abatement costs. 
Cons: 
Multiple spot abatement projects would be required during tenant improvement or
maintenance work that impacted regulated materials.
There is a risk of inadvertent regulated materials release and exposure to workers, staff
and the general public during remodeling work. 
Tenants would not be allowed to remodel and/or reconfigure the space. 
This approach is not in alignment with the tenant's interests and would leave them with a
space that might not be maximized for its intended use and the flexibility of use of the
space would be substandard as compared to the earlier abated spaces used by other
airlines in the vicinity.
This could lead to a much less efficient use of the diminishing supply of available tenant
spaces. 
This is not the recommended alternative. 
Alternative 2)  Perform regulated materials abatement in a "spot" fashion only where required
to complete structural attachments for or impacted by tenant improvements. 
Project Cost:  $1,600,000 for the Port/Unknown for Tenants

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
July 27, 2015 
Page 6 of 6 
Pros: 
In theory, the spot regulated materials abatement costs would be less than for a complete
abatement. 
Annual rent from previously vacant space will increase revenues by approximately $1.6
million. 
Cons: 
Coordinating the abatement work with the tenant improvement construction work will
take longer. 
Upon completion of the spot abatement and tenant improvement work, the remaining
regulated materials would continue to require management and cause a risk of future
release and/or exposure. 
This is not the recommended alternative. 
Alternative 3)  Perform regulated materials abatement as necessary in the identified locations
prior to each tenant improvement project that has been identified. 
Project Cost:  $1,800,000 
Pros: 
The regulated materials will be abated from each location and will not impact future
tenant construction work. 
The risk of inadvertent regulated materials release/exposure in these locations is
eliminated. 
Allows the Port to optimize existing leasable space in the Main Terminal. 
The tenants will be able to configure each space to best suit their needs. 
Annual rent from previously vacant space will increase revenues by approximately $1.6
million. 
Cons: 
This is the costliest alternative. 
The regulated materials abatement schedule will determine the tenant improvement
schedules. 
This is the recommended alternative. 
ATTACHMENTS TO THIS REQUEST 
Maps showing project locations 
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS 
None