11a. Memo

Baggage Optimization Program Second Quarter 2022 Update

AGENDA MEMORANDUM                        Item No.          11a 
BRIEFING ITEM                             Date of Meeting       April 26, 2022 
DATE:     April 19, 2022 
TO:        Stephen P. Metruck, Executive Director 
FROM:    Jeffrey Brown, Aviation Chief Development Officer 
Wayne Grotheer, Director Aviation Project Management 
SUBJECT:  Baggage Optimization Program Update  Quarter 2, 2022 
Baggage Optimization Program (BOP) is an airport-wide public safety and security program that
improves customer service for both airlines and passengers. This is a long-term, three-phase
program that is anticipated to be completed in 2026. Prior to Baggage Optimization the Airport
baggage system was actually six separate systems. Modifying the separate systems was the
best way to rapidly increase security after September 11. However, to meet long-term growth
needs of the overall Airport, BOP replaces six aging individual baggage screening systems with
one centralized system at Seattle-Tacoma International Airport. The new system will meet
Transportation Security Administration (TSA) safety and security requirements while ensuring
reliability, flexibility and efficiency for airlines and passengers. When complete, BOP enables 
the flexibility for bags to be checked in from any ticket counter and be efficiently conveyed to
any airplane gate. This program allows the airport to meet the demands of growing airlines.
Due to the lack of interconnectivity until the project is complete, continuous 24/7 operation,
and a fixed footprint this project is complex and has various constraints that require detailed
construction sequencing plans.
BOP is being bid and constructed in three separate phases. Phase 1 focused on the central
terminal building,  the core of the centralized screening system,  and installed eight new
screening machines. Phase 1 construction was complete Q2 2020 and was $37M under budget
at $98M total cost. 
Phase 2 is under construction to install four additional screening machines, new tenant storage
and maintenance shop, final baggage handling system sortation matrix, and additional capacity
to South Satellite. Phase 2 was delayed approximately six months due to a negative Majority-In-
Interest (MII) vote when the airlines did not support the budget increase needed due to
unexpected high bids. However, together with the Contractor, the Port team worked to regain
the time by taking advantage of low passenger volume due to COVID-19 to re-sequence the
construction steps and through efficiencies receive credits and gain back six months.

Template revised April 12, 2018.

COMMISSION AGENDA  Briefing Item No. _11a_                               Page 2 of 5 
Meeting Date: April 26, 2022 

In Phase 2, the project team together with the Airline stakeholders have completed over 375
major and complex shutdowns including the baggage system in a 24/7 operating airport. Phase
2 is within budget and is approximately 45% complete. Phase 2 is scheduled for completion in 
Q2 2024. 
Phase 3 is the final phase of the program. It will focus on the tie-in of the south end systems to
centralized screening, tie-in of the International Arrivals Facility (IAF), and finalize the sortation
and ticket counter connections. After conducting lessons learned from previous phases and
discussions with executives and airlines, Phase 3 project delivery method is recommended to
be General Contractor/Construction Manager (GC/CM) to allow for the contractor to be part of
the design and gain earlier insight and control of construction costs.  The following will be
brought to Commission later in 2022: 1) recommendation and request to change the project
delivery method; 2) increase the design consultant's contract amount to complete Phase 3
design; 3) advertise and execute a project specific construction management contract to
provide GC/CM expertise; and 4) advertise and execute a contract for preconstruction services.
As the Phase 3 estimate is better defined, a request for a budget increase will also be brought
to Commission. Development of Phase 3 design will begin in Q3 2022. 
Supply Chain  The impacts of COVID-19 on the supply chain are currently causing
delayed manufacturing and delivery of critical equipment that could impact the project
schedule if delays continue. We are seeing delays of motors, gear boxes, bearings,
power turns, and fiber optic cable, all of which are major required components of the
baggage system. Cost or schedule impacts (or both) are possible. The team is mitigating 
some of the issues with early shipment and storage of delivered material in an offsite
warehouse and continued outreach to suppliers. The team is also prioritizing equipment
and approving alternative products.
Project Coordination -  There  are four other projects that are critical for BOP
coordination in order to mitigate risks of incompatibility in equipment, design, or
construction. The BOP team is involved in coordination, design reviews, and planning to
manage the risks and expectations. 
1.  International  Arrivals  Facility  (IAF)    In  order  for  BOP  Phase  2  to  start
construction of the South Satellite baggage feeds and makeup devices for
loading to baggage carts, the project requires IAF to be fully operational. Delays
of the IAF opening directly impact the construction schedule and delays are
costing about $10,000 per day for the BOP Phase 2 contract. 
2.  C Concourse Expansion  This project will transfer scope and budget to the
Baggage Optimization  Project to manage, design, and construct conveyor 
transfer lines that are impacted by C Concourse Expansion construction pending
Commission action in Q2 2022. The baggage work will be done by the BOP
project  to  minimize  construction  and  operational  risk  and  operational

Template revised September 22, 2016.

COMMISSION AGENDA  Briefing Item No. _11a_                               Page 3 of 5 
Meeting Date: April 26, 2022 
3.  North Main Terminal Redevelopment Project (NMTRP)  The two projects are 
currently coordinating critical ticket counter main line connections, odd size
baggage handling scope, construction sequencing, and schedule to minimize risk
and operational impacts on both the BOP and NMTRP projects. 
4.  North Main Terminal Utilities Upgrade Project (NTUUP)  This project intends to
transfer scope to BOP to construct a utilidor  in the area of BOP Phase 2
construction and be sequenced within the construction schedule with minimal
disruptions to either project. 
Airline Operational Impacts  Constructing a complex project in a 24/7 operating airport
with minimal disruptions to live operations and within the same space as the existing
system will continue to be a challenge.  The baggage team continues to take steps to
communicate with all stakeholders including Airline Technical Representatives (ATR) and
develop detailed plans, run trials, and monitor the work.
Airline Manual Baggage Handling   Constructing the new baggage system while
maintaining the existing system will at times leave long term temporary conditions
within the baggage system. The temporary conditions may result in manual  baggage
handling  of the bags by an Airline employee  due to construction and schedule
complexity. The ba ggage team has tried to identify the most impactful steps in the
construction and coordinates frequently with the Airlines and ATR to minimize the risk
and impact to operations. 
Program Schedule 
Phase 1 was completed in Q2 2020. Phase 2 is currently under construction scheduled to be
completed in Q2 2024; however, the end date is tied to the IAF opening and supply chain
issues.  Phase 3 design is scheduled to start in Q3 2022 and is scheduled to be constructed by
Q3 2026. 

Phase               Design                  Construction 
Phase 1              Q3 2015                    Q2 2020 
Phase 2              Q1 2020               Q3 2020  Q2 2024 
Phase 3         Q2 2023  Q1 2024          Q1 2024  Q3 2026 

Program Budget 
Phase 2 budget and authorization includes $10M executive director reserve. At this time the
project has not utilized any funds from the reserve. Phase 3 has not started construction and in
the process of developing an estimate.  The current range for Phase 3 is between $400M - 
$500M.  Phase 3 authorization of $13M is for design and pre-construction funding.  TSA

Template revised September 22, 2016.

COMMISSION AGENDA  Briefing Item No. _11a_                               Page 4 of 5 
Meeting Date: April 26, 2022 
contributes $94M to the overall project budget. The Port has been reimbursed for more than
$65M to date from TSA (March 2022).

Phase           Current Budget         Forecast at Completion      Current Authorization 
Phase 1            $101,375,000                $97,488,982                $101,375,000 
Phase 2            $425,675,000               $415,675,000               $425,675,000 
$400,000,000 to
Phase 3            $313,000,000                                            $13,000,000 
Total              $840,050,000              To Be Determined              $540,000,000 

Diversity in Contracting 
Baggage Optimization Phase 2 has a WMBE goal of 2% due to the nature of the scope of work
primarily being baggage conveyors and limited building work. The project is approximately 45%
complete and WMBE utilization is at 1.21% of the total contract; the project is on track for
meeting the 2% goal. 
The Baggage Optimization project was scoped in 2012 to accommodate 45 million annual
passengers (MAP) with an expandable design to accommodate future growth. At the time,
growth forecasts were flat and predicted that 45 MAP would be adequate through 2027. The
decision was made to proceed in building an expandable 45 MAP system with the expectation
that an expansion would occur in the future in time to accommodate growth up to the 60 MAP
level. Due to unprecedented growth at the airport, the 45 MAP threshold was met in 2016, over
ten years earlier than anticipated. In June 2017, the Commission authorized the project to
incorporate a capacity expansion of the Baggage Optimization project in order for the new
outbound baggage system to accommodate 60 MAP. 
(1)   Presentation slides 
January 28, 2020  Commission Authorization to (1) execute a construction contract
with the low responsive and responsible bidder for the Baggage Optimization Phase 2
Project  at  Seattle-Tacoma  International  Airport,  notwithstanding  the  low  bid
exceeding the estimate at time of bid by more than 10 percent, and (2) authorize an
additional  $190,737,800 for Phase  2  construction  and  Phase  3  design  for a  total
program authorization of $540,050,000 

Template revised September 22, 2016.

COMMISSION AGENDA  Briefing Item No. _11a_                               Page 5 of 5 
Meeting Date: April 26, 2022 
April 23, 2019  Commission Authorization to (1) advertise, award, and execute a
construction contract for the Baggage Optimization Phase 2 project at Seattle-Tacoma
International Airport; (2) employ a project labor agreement (PLA); and (3) utilize Port
crews and small works contracts to perform construction work 
February 26, 2019  Baggage Optimization Quarter 4 Project Briefing 
October 23, 2018  Baggage Optimization Quarter 3 Project Briefing 
June 12, 2018  Baggage Optimization Quarter 2 Project Briefing 
January 9, 2018  Baggage Optimization Quarter 4 Project Briefing 
September 26, 2017  Baggage Optimization Quarter 3 Project Briefing 
June 27, 2017  Commission authorization to (1) authorize additional design and project
management funds to expand the capacity to 60 million annual passengers (MAP); (2)
use Port crews and small works contracts to perform additional construction work; and
(3) amend Service Agreement P-00317641 to add $10,160,000 
October 25, 2016  Baggage Optimization Quarter 4 Project Briefing 
July 12, 2016  Commission authorization to advertise and execute a contract for
construction Phase 1 
June 28, 2016 Baggage Program Briefing 
May 17, 2016  Checked Baggage Optimization Project Briefing 
March 8, 2016  Commission authorization for the Chief Executive Officer to amend the
Baggage Optimization Design Services contract 
June 23, 2015  Checked Baggage Optimization Project Briefing 
September   10,   2013      The   Commission   authorized   the   execution   of   an
Other Transaction Agreement (OTA) with TSA for reimbursable costs for design;
construction, and to authorize $15 million to continue from 30% to 100% design; and
execute a consultant service agreement for program management support services 
August 20, 2013  Response to questions from Commissioners asked during August 6,
2013 Commission Meeting 
August 6, 2013  The Commission was briefed on the near-term and long-term
challenges related to handling checked baggage at the Airport 
January 22, 2013  The Commission authorized $5 million for staff to begin design
through 30%, and to enter into an agreement to allow reimbursement from the federal
government to the Port for eligible elements of the 30% design effort 
January 8, 2013  Baggage Systems Briefing 
August 14, 2012  Baggage system recapitalization/optimization was noted in the 2013
business plan and capital briefing as a significant capital project not included in 2013-17
capital program 
August 7, 2012  Baggage system recapitalization/optimization was referenced as one of
the drivers for the need to develop an Airport Sustainability Master Plan 
June 26, 2012  The Airport's baggage systems were discussed during a briefing on
terminal development challenges 
May 10, 2012  TSA's interest in a national recapitalization/optimization plan for all
baggage-screening operations was referenced in a design authorization request for the
C60-C61 Baggage Handling System Modifications Project 

Template revised September 22, 2016.

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