PORT OF SEATTLE 
MEMORANDUM 
COMMISSION AGENDA               Item No.      6d 
ACTION ITEM 
Date of Meeting     March 24, 2015 
DATE:    March 17, 2015 
TO:      Ted Fick, Chief Executive Officer 
FROM:   Dave Soike, Director, Aviation Facilities and Capital Program 
Wayne Grotheer, Director, Aviation Project Management Group 
SUBJECT:  North Satellite Renovation & North Satellite Transit Station Lobbies Project (CIP
#C800556) Seattle-Tacoma International Airport 
Amount of This         $1,954,000   Source of Funds:   Airport Development Fund 
Request:                                          Revenue Bonds and
Est. Total Project Cost:    $421,682,944                  Passenger Facility Charges 
Est. State and Local       $28,951,600 
Taxes: 
ACTION REQUESTED 
Request Commission authorization for the Chief Executive Officer to take the following actions related
to the North Satellite (NSAT) Renovation & North Satellite Transit Station (STS) Lobbies Project at the
Seattle-Tacoma International Airport: (1) increase the project scope to expand the baggage handling
system (BHS) to facilitate the previously approved building expansion, increasing the estimated total
project cost by $14,400,000 for a revised total of $421,682,944; and (2) complete the BHS design for
$1,954,000, included within the $14,400,000 above and execute amendments to existing design,
planning, and program management consulting contracts accordingly. 
SYNOPSIS 
A key factor in renovating and expanding the North Satellite is meeting the Port's and Alaska Air
Group's (AAG) vision, project objectives, and specific requirements. The Port and AAG share goals for
the North Satellite including: compliance with applicable codes to ensure life safety, improved
passenger experience, increased level of service, and passenger comfort. 
It is also important to minimize, to the greatest extent possible, negative impacts to operations during
construction, including continuity of baggage sorting. In order to meet the customer experience level -
of-service goals and to minimize construction impacts to operations for the NSAT project, the baggage
system must be expanded concurrent with the expansion of the building. This would ensure sufficient
baggage system capacity during the renovation of the existing building. Renovation requires shutdown
of the existing pier sort baggage system. 
Future construction of the Baggage Recapitalization program will affect baggage capacity throughout
the Airport's system. Completing the North Satellite baggage expansion early provides capacity to

Template revised May 30, 2013.

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
March 17, 2014 
Page 2 of 7 
support baggage operations affected by this future construction. At completion of the NSAT project, the
entire baggage system would provide AAG and the Port sufficient capacity and transport rates to 
accommodate the current rate of growth for the future. 
The timing of constructing this baggage expansion impacts the phased construction of the larger North
Satellite renovation and expansion project. To minimize any potential impacts and to ensure efficiencies, 
Port staff determined and AAG agreed that the baggage expansion should be implemented as part of the
North Satellite renovation and expansion project by the General Contractor/Construction Manager 
(GC/CM). If done separately, both projects would require extensive modifications to the base building 
infrastructure that would severely hamper AAG operations and create a higher potential for conflict
between construction projects. By timing the work to coincide with the larger North Satellite renovation
project, the Port can better coordinate the installation of all infrastructure required by the project. 
BACKGROUND 
Original passenger forecasts for the NorthSTAR program indicated that the original baggage
refurbishment project (currently under construction) would provide sufficient capacity for the expected
traffic levels for the duration of the NorthSTAR program. The analysis leading to the decision to
expand the satellite revealed the refurbished North Satellite (C88) baggage system will be near or at
capacity at the opening of the expanded 20-gate facility in 2020. 
The Port Commission approved the expansion of the NSAT in August 2014 supported by approvals
from  the airlines by a majority-in-interest  vote, support of AAG Executive Leadership and the
recommendation of Port staff. NorthSTAR quarterly program updates to the Commission have included
the allowance that the baggage system requirements would be evaluated to determine if the existing
system needed to be expanded. Staff is now recommending the baggage system be expanded and is 
requesting it be added to the scope of the NSAT project. This requires that the NSAT budget be
increased by $14,400,000 for a total budget of $421,682,944. It is requested that  $1,954,000 be
authorized for design to expand the baggage system. 
PROJECT JUSTIFICATION AND DETAILS 
The Port, collaborating with AAG, completed a thorough analysis of the baggage expansion and
compiled recommendations to maximize the existing C88 baggage system by creating a cohesive and
efficient baggage handling system to support the NSAT project and Alaska's future growth. The report
concluded that a total of 18 piers will be required to provide adequate baggage capacity through
completion of the 20-gate North Satellite project. The existing NSAT system has 11 piers resulting in
the need to add 7 piers.  In addition, other planned Airport projects require Airport-wide baggage
capacity to be reduced during construction. The forecast of baggage capacity after completion of the
NSAT expansion indicates that there may be 3-4 piers of spare capacity for future growth. A major
secondary benefit of expanding the NSAT baggage system is that the additional capacity created can be
immediately utilized by airlines temporarily displaced during construction phasing of other Airport
capital projects. This project aids in the development of an overall capital phasing program for the
Airport baggage system.

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
March 17, 2014 
Page 3 of 7 
Project Objectives 
Replace and/or modify the baggage infrastructure to support the building expansion, improve
efficiency, and to reduce operating and maintenance costs. 
Scope of Work 
Add 7 new sort piers built within the newly created bag well as part of the 9 bay expansion to the
satellite. 
Speed up North Satellite tunnel conveyors to increase capacity to accommodate NorthSTAR
traffic levels 
Replace Master Control Panels (MCPs) located in the main terminal 
Provide adequate transfer bag input belts to better accommodate final North Satellite AAG
baggage operations. 
Schedule 
Q2 2015  Begin design 
Q3 2015  Complete 60% design 
Q1 2016  Complete 90% design 
Q1 2016  Commission Authorization for Construction 
Q3 2016  Begin Construction 
Q3 2017  Utilize BHS system 
Q2 2018  Substantial Completion for BHS 
FINANCIAL IMPLICATIONS 
Budget/Authorization Summary              Capital     Expense   Total Project 
Original Budget                     $194,300,000    $5,000,000   $199,300,000 
Previous budget increase               $207,182,944     $800,000   $207,982,944 
Proposed budget increase                $14,400,000          $0   $14,400,000 
Revised budget                     $415,882,944    $5,800,000   $421,682,944 
Previous Authorizations                $55,464,800     $200,000   $55,664,800 
Current request for authorization            $1,954,000          $0    $1,954,000 
Total Authorizations, including this request    $57,418,800      $200,000    $57,618,800 
Remaining budget to be authorized        $358,464,144    $5,600,000   $364,064,144 
Total Estimated Project Cost            $415,882,944    $5,800,000   $421,682,944 

Project Cost Breakdown                        This Request      Total Project
Budget 
Construction Phase                                        $334,344,600 
Design Phase                               $1,954,000      $58,386,744 
State & Local Taxes (estimated)                                 $28,951,600 
Total                                                    $421,682,944

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
March 17, 2014 
Page 4 of 7 

Budget Status and Source of Funds 
This project is included in the 2015  2019 capital budget and plan of finance with a budget of $401.5
million. The proposed budget increase will be transferred from the Aeronautical Allowance CIP
(C800404) resulting in no net change to the Aviation Division capital program.  The Airport
Development Fund (augmented as needed with the issuance of commercial paper) continues to be the
initial source of funds for this project but funding for the entire project will include Passenger Facility
Charge revenues (PFCs) and future revenue bond issues. The Port anticipates issuing revenue bonds in
2015. 
The terms under which AAG will participate in the Port's NorthSTAR Program costs have been
established via an April 5, 2012, Letter of Agreement between the Port and AAG. The airlines were
briefed on December 18, 2013, with regard to the decision to expand the NSAT and the resultant
increase in budget.  The formal majority-in-interest (MII) project approval process outlined in the 
Signatory Lease and Operating Agreement (SLOA) will be followed, with the Port submitting a ballot to
the airlines seeking approval to construct the expanded baggage system. 
Financial Analysis and Summary 
CIP Category             Renewal and Replacement 
Project Type              Terminal Infrastructure 
Risk adjusted discount rate     N/A 
Key risk factors             N/A 
Project cost for analysis        $422M 
Business Unit (BU)          Terminal 
Effect on business performance  NOI after depreciation will increase 
IRR/NPV             N/A 
CPE Impact             $1.32 by 2021. The actual CPE impact for this project
could be lower depending on the amount of PFCs applied
to construction costs and on revenue bond debt service. 
Lifecycle Cost and Savings 
An adequate estimate of staff hours and materials expense to operate the expanded system is not
available due to the early stage of project design. However, staff will provide an accurate estimate as
design progresses. It is already understood that the expansion of the existing system will employ
variable frequency drives, high efficiency motors, and a new control system, all intended to improve
system energy efficiency. These features are consistent with the operation of the existing system. 
STRATEGIES AND OBJECTIVES 
The anticipated growth in domestic and international enplanements will require additional capacity in
baggage processing for all airlines throughout the Airport. This project supports the Port's Century
Agenda objective of meeting the region's air transportation needs at Sea-Tac Airport for the next 25

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
March 17, 2014 
Page 5 of 7 
years. This project also supports the Aviation Division's strategy of anticipating and meeting the needs
of our tenants, passengers, and the region's economy. 
This is one of a number of projects that are directly tied to the One-Time Reallocation (Airline
Realignment) program and that are in alignment with AAG's plan to consolidate its gate operations onto
the NSAT and Concourses C and D. The NSAT expansion is also in alignment with Airport master plan
development objectives that identify the NSAT as the most logical location for near-term expansion of
Airport capacity. 
TRIPLE BOTTOM LINE 
Economic Development 
This project will increase the long-term ability of the Airport to serve AAG's future growth. This project
cost effectively meets AAG's needs by upgrading existing systems rather than building entirely new
systems. 
Environmental Responsibility 
This project demonstrates environmental sustainability by improving existing Port assets to extend their
life, installing variable frequency drives and higher efficiency components when replacing equipment,
and better utilizing existing resources. 
Community Benefits 
Long-term vitality of the Airport benefits the regional economy, the local environment and nearby
communities. The Office of Social Responsibility (OSR) has established requirements that will apply to
this project.  The design and construction procurement acquisition plan recommends the use of an
existing contract for BHS design, which includes participation of two qualifying sub-consulting small
business firms. The GC/CM construction contract as presented to Commission on January 6, 2015, has
not been completed. 
Small Business Participation 
Project managers are coordinating with the Office of Social Responsibility to maximize small business
participation opportunities including, but not limited to,  Small Contractors and Suppliers (SCS)
participation in accordance with Small Business Resolution No. 3618. 
ALTERNATIVES AND IMPLICATIONS CONSIDERED 
Alternative 1)  Retain the Status Quo. No expansion of the existing NSAT baggage system will be
done. This is not a recommended alternative. 
PROS: 
No additional cost to the project

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
March 17, 2014 
Page 6 of 7 
CONS: 
Does not support the Port's and AAG's vision and NorthSTAR objective to be able to support all
flights originating from the NSAT with a baggage system located at the NSAT. 
The baggage system will not support the anticipated increase in demand and capacity of the
NorthSTAR program either during construction or into the future. 
The existing NSAT BHS system has insufficient capacity to augment airport-wide baggage
system capacity and demand during construction of other airport capital projects. 
Alternative 2)  Extend the current North Satellite Baggage system (C88) mainline and recirculation
baggage belt sort system, install four new sort piers, add two new transfer input belts, speed up the
current sort and tunnel systems, and install all necessary power and controls infrastructure through the
GC/CM contract for NorthSTAR. This is not the recommended alternative. 
PROS: 
Supports the Port's and AAG vision and NorthSTAR objectives at the opening of the NSAT
expansion. 
The recommended GC/CM path allows the project to be completed while minimizing impacts to
the baggage system operation. 
CONS: 
This alternative adds an estimated $12 million to the NorthSTAR NSAT Renovation & STS
Lobbies Project. 
The existing NSAT BHS system has insufficient capacity to augment the airport-wide baggage
system capacity and demand during construction of other Airport capital projects. 
The baggage system at NSAT will not support the anticipated increase in demand and capacity
of the NorthSTAR program beyond the opening of the NSAT after the expansion. 
Alternative 3)  Extend the current North Satellite Baggage system (C88) mainline and recirculation
baggage belt sort system, install seven new sort piers, add two new transfer input belts, speed up the
current sort and tunnel systems, and install all necessary power and controls infrastructure through the
GC/CM contract for NorthSTAR.  This is the recommended alternative. 
PROS: 
This option will support the Port's and AAG vision and NorthSTAR objectives. 
The baggage system at NSAT will support the anticipated increase in demand and capacity of the
NorthSTAR program during construction and beyond. 
The recommended GC/CM path allows the project to be completed while minimizing impacts to
the baggage system operation. 
CONS: 
This alternative adds $14.4 million to the NSAT Project.

COMMISSION AGENDA 
Ted Fick, Chief Executive Officer 
March 17, 2014 
Page 7 of 7 
ATTACHMENTS TO THIS REQUEST 
NorthSTAR BHS phased diagram. 
PREVIOUS COMMISSION ACTIONS OR BRIEFINGS 
January 27, 2015  NorthSTAR Program Status Update 
January 6, 2015  The Commission authorized (1) $5,000,000 preconstruction services; (2)
execution of a General Contractor/Construction Manager (GC/CM) contract for preconstruction
services; and (3) transfer of scope, $1,750,000 budget and authorization for STS station roof
replacement to the North Satellite Renovation and Expansion project. 
October 28, 2014  NorthSTAR Program Status Update 
August 5, 2014  Commission authorized an estimated $191,323,143 to expand the NSAT by 8
additional gates, an additional $15,717,800 for design completion, and use of the GC/CM
alternative public works contracting procedure for NSAT expansion construction procurement. 
July 22, 2014 - NSAT Expansion Briefing. 
April 16, 2014  Seattle-Tacoma International Airport Capital Program  Briefing. 
January 14, 2014  NorthSTAR Program status update and initial NSAT Expansion briefing. 
September 24, 2013  NorthSTAR Program status update. 
September 24, 2013  The Commission authorized staff to: (1) advertise, award, and execute a
major public works contract for the construction of the NSAT Refurbish Baggage System
Project; and (2) authorize the use of Port crews. 
June 25, 2013 NorthSTAR Program status update. 
May 28, 2013, Commission authorized the execution of separate service agreements for
Construction Management Services and Commissioning Services, of approximate values of $10
million and $1.5 million. 
April 9, 2013  The Commission authorized the Chief Executive Officer to enter into a project
labor agreement covering the NorthSTAR program's five major construction projects. 
March 26, 2013 NorthSTAR Program status update. 
December 11, 2012  The Commission was briefed on the Vertical Conveyance Modernization
Project Aero Phases 1 and 2 and the possibility of adding the specified elevators and escalators to
the NorthSTAR program. 
July 24, 2012 - Commission authorized $32,000,000 for the design of the NorthSTAR NSAT 
Renovation and NSTS Lobbies project. 
June 26, 2012 - The Port Commission was briefed on the NorthSTAR program by Wayne
Grotheer, Director Aviation Project Management Group. 
April 10, 2012 - The Commission authorized the execution of consultant contracts for design and
construction support services; program management services; and the completion of site surveys
for regulated materials management, in the amount of $1,200,000.