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Los Angeles World Airports TM RESOLUTION NO. 26898 BE IT RESOLVED that, on recommendation of Management, the Board of Airport Commissioners approved the First Amendment to Equipment Acquisition Agreement DA-5158 with Tom Bradley International Terminal Equipment Company for minor administrative updates and update to revised scope components, covering acquisition of upgrades to the baggage handling systems in the Tom Bradley International Terminal and Midfield Satellite Concourse at Los Angeles International Airport, as referenced in the Board-adopted staff report attached hereto and made part hereof; and LAX Van Nuys BE IT FURTHER RESOLVED that said Board authorized the Chief Executive Officer to execute said First Amendment after approval as to form by the City Attorney and approval by the Los Angeles City Council; and City of Los Angeles Eric Garcettl Mayor Board of Airport Commissioners BE IT FURTHER RESOLVED that the issuance of permits, leases, agreements, gate and space assignments, and renewals, amendments or extensions thereof, or other entitlements granting use of existing airport facilities or its operations is categorically exempt from California Environmental Quality Act (CEQA) requirements pursuant to Article III, Class 1 (18)(c) of the Los Angeles City CEQA Guidelines; and Sean O. Burton President Valeria C. Velasco Vice President BE IT FURTHER RESOLVED that this action is subject to the provisions of Los Angeles City Charter Sections 373. Gabriel L. Eshaghian Beatrice C. Hsu Nicholas P. Roxborough Dr. Cynthia A. Telles Karim Webb oOo Deborah Flint Chief Executive Officer I hereby certify that this Resolution No. 26898 is true and correct, as adopted by the Board of Airport Commissioners at its Regular Meeting held on Thursday, November 21, 2019. Grace Miduei - Secretary BOARD OF AIRPORT COMMISSIONERS _d,\\ 41 iV»EJ, Li 1 World Way Los Angeles California 90045-58Q3 Mail P.O-Box 92216 Los Angeles California 900Q9-2216 Telephone 310 646 5252 Internet www.lawa.org

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Page 1: Los Angelesclkrep.lacity.org/onlinedocs/2014/14-0769_reso_11-25-2019.pdf · Los Angeles World Airports TM RESOLUTION NO. 26898 BE IT RESOLVED that, ... covering acquisition of upgrades

Los Angeles World Airports

TM

RESOLUTION NO. 26898

BE IT RESOLVED that, on recommendation of Management, the Board of Airport Commissioners approved the First Amendment to Equipment Acquisition Agreement DA-5158 with Tom Bradley International Terminal Equipment Company for minor administrative updates and update to revised scope components, covering acquisition of upgrades to the baggage handling systems in the Tom Bradley International Terminal and Midfield Satellite Concourse at Los Angeles International Airport, as referenced in the Board-adopted staff report attached hereto and made part hereof; andLAX

Van Nuys

BE IT FURTHER RESOLVED that said Board authorized the Chief Executive Officer to execute said First Amendment after approval as to form by the City Attorney and approval by the Los Angeles City Council; and

City of Los Angeles

Eric Garcettl Mayor

Board of Airport Commissioners

BE IT FURTHER RESOLVED that the issuance of permits, leases, agreements, gate and space assignments, and renewals, amendments or extensions thereof, or other entitlements granting use of existing airport facilities or its operations is categorically exempt from California Environmental Quality Act (CEQA) requirements pursuant to Article III, Class 1 (18)(c) of the Los Angeles City CEQA Guidelines; and

Sean O. Burton President

Valeria C. Velasco Vice President

BE IT FURTHER RESOLVED that this action is subject to the provisions of Los Angeles City Charter Sections 373.

Gabriel L. Eshaghian Beatrice C. Hsu Nicholas P. Roxborough Dr. Cynthia A. Telles Karim Webb

oOoDeborah Flint Chief Executive Officer

I hereby certify that this Resolution No. 26898 is true and correct, as adopted by the Board of Airport Commissioners at its Regular Meeting held on Thursday, November 21, 2019.

Grace Miduei - SecretaryBOARD OF AIRPORT COMMISSIONERS

_d,\\41iV»E J,Li

1 World Way Los Angeles California 90045-58Q3 Mail P.O-Box 92216 Los Angeles California 900Q9-2216 Telephone 310 646 5252 Internet www.lawa.org

Page 2: Los Angelesclkrep.lacity.org/onlinedocs/2014/14-0769_reso_11-25-2019.pdf · Los Angeles World Airports TM RESOLUTION NO. 26898 BE IT RESOLVED that, ... covering acquisition of upgrades

Los Angeles World Airports

REPORT TO THEBOARD OF AIRPORT COMMISSIONERS

Meeting Date.

Approved by: Dave Jones, Director Airline Property and iQfls-Sepyjces

t 11/21/2019Co\

□ Completed

El Pending

*

Revhwml by: Jeffrey Utterback, Deputy Executive Director CAP Review:

□ N/A/

Reviewed for Date Approval Status

BY □ N □ NA

ByX-tty Atti ley Finance 11/13/2019

10/31/201911/4/2019

RWCEQA

ProcurementE3Y □ N PI

E3Y DN □ Cond MJ"ab Flint - Chief Executive Officer 11/6/2019 iGuest Experience E3Y DN BY

10/31/2019) BY □ N □ NAStrategic Planning KV

SUBJECT: Approval of First Amendment to Equipment Acquisition Agreement DA-5158 with the Tom Bradley International Terminal Equipment Company

Approve the First Amendment to Equipment Acquisition Agreement DA-5158 with the Tom Bradley International Terminal Equipment Company to make minor administrative updates and update revised scope components.

RECOMMENDA TIONS:

Management RECOMMENDS that the Board of Airport Commissioners:

1. ADOPT the Staff Report.

DETERMINE that this action is categorically exempt from the California Environmental Quality Act (CEQA) pursuant to Article III, Class 1 (18)(c) of the Los Angeles City CEQA Guidelines.

2.

APPROVE the First Amendment to Equipment Acquisition Agreement DA-5158 with Tom Bradley International Terminal Equipment Company.

3.

AUTHORIZE the Chief Executive Officer to execute the First Amendment to the Equipment Acquisition Agreement DA-5158 with Tom Bradley International Terminal Equipment Company upon approval as to form by the City Attorney and upon approval by the Los Angeles City Council.

4.

Page 1TBITEC DA-5158 First Amendment 10-26-19

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DISCUSSION:

1. Purpose

To make minor administrative changes to the Equipment Acquisition Agreement and update revised scope components.

2. Prior Related Actions

• November 17, 2016, Resolution 26115 (DA-5158 and DA-5159)The Board of Airport Commissioners (Board) approved two (2) Equipment Acquisition Agreements with Tom Bradley International Terminal Equipment Company (TBITEC) to acquire upgrades to the baggage handling systems (BHS) in the Tom Bradley International Terminal (TBIT) and the Midfield Satellite Concourse (MSC).

3. Current Action

TBITEC is a nonprofit airline consortium formed to design, finance, install, operate and maintain passenger and aeronautical support equipment at Los Angeles International Airport (LAX). TBITEC licenses, operates, and maintains aeronautical equipment, including the Baggage Handling System (BHS) in TBIT, pursuant to Lease and License Agreement LAA- 8600 (Lease). Section 8.03(b) of the Lease allows Los Angeles World Airports (LAWA), subject to Board approval, to acquire equipment that TBITEC procures and installs if the useful life extends beyond the term of the Lease and the capital costs of the equipment are included as terminal rental rate in accordance with the Los Angeles International Airport Rates and Charges Methodology.

The term of the Lease is September 15, 2025, with an option to extend to December 31, 2030. Therefore, in November 2016, the Board approved two Equipment Acquisition Agreements in accordance with the methodology contemplated in the Lease for TBITEC to manage BHS upgrades in TBIT and the MSC, since the useful life of this equipment will exceed the term of the Lease. The scope of the BHS projects is to expand screening and processing capacity and seamlessly install new equipment required to meet airline operational needs at the MSC. TBITEC agreed to manage the design and construction of the BHS equipment upgrade in order to mitigate the risk posed by operating the existing BHS while installing new baggage equipment that will connect into the existing system.

The first phase, contemplated by Equipment Acquisition Agreement DA-5158, allows TBITEC to install new BHS equipment in the tunnels, North Baggage Handling Facility, basement, and ramp areas constructed by LAWA as part of the MSC project. In the second phase, contemplated by Equipment Acquisition Agreement DA-5159, TBITEC will increase checked baggage screening and processing capacity for the entire TBIT/MSC complex. Installation of the first phase is approximately 75% complete with major sortation equipment already installed and currently in the commissioning phase. Design of the second phase is 30% complete.

During construction of the first phase, TBITEC and LAWA staff proposed changes to the original scope to eliminate unnecessary work and add improvements to domestic/pre­cleared baggage claim equipment. The table below entitled “Exhibit A - Original Scope of Work” lists the four components initially contemplated in Equipment Acquisition Agreement DA-5158. Total cost for these components shall not exceed $185M and the proposed changes to the scope will not change the total not-to-exceed cost of the Agreement.

Page 2TBITEC DA-5158 First Amendment 10-26-19

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LAWA only pays for verified, actual costs incurred by TBITEC to design, procure and install the equipment contemplated in Exhibit A of the Equipment Acquisition Agreement.

Exhibit A - Original Scope of Work

Scope Component DescriptionTemporary Sortation & Make-Up Facility

Design and installation of a temporary sortation and make­up facility to support existing TBIT operations before the MSC or North Baggage Handling Facility are operational.

1.

Temporary Checked Baggage Inspection System

Design and installation of a temporary Checked Baggage Inspection System to augment the existing outbound nine (9) CTX-9400 CBIS and eight (8) CTX-5500 stand-alone screening system to support the new gates at the MSC.

2.

Individual Carrier System, MSC Early Bag Storage, Baggage Sortation & Make-Up

Design and installation of an Individual Carrier System (ICS) for outbound bag delivery and empty carrier returns between TBIT and MSC via new underground transition facility, East and West tunnels. Design and installation of Early Baggage Storage, sortation and make-up systems at the MSC that connect to the new Individual Carrier System (ICS) from the West Tunnel.

3.

4. Individual Carrier System, North Early Bag Storage, Baggage Sortation & Make-Up

Design and installation of an Individual Carrier System (ICS) for outbound bag delivery and empty carrier returns between TBIT and NBHS via new underground transition facility, East, West, and North tunnels. Design and installation of Early Baggage Storage, sortation and make­up systems at the NBHS that connect to the new Individual Carrier System (ICS) from the North Tunnel.____________

TBITEC and LAWA staff determined that the second component (Temporary Checked Baggage Inspection System) is no longer necessary, and that scope to increase capacity of the domestic bag claim device to serve the growing demand for domestic and pre-clear arrival operations in TBIT should be included instead. Swapping these scope items will change the timing of acquisitions to align with completion of the new domestic bag claim. In addition, staff propose splitting the third and fourth components into two packages to allow more timely acquisition of components, which will reduce accrual of finance charges. To implement these recommended changes, staff propose amending the components to replace the Temporary Checked Baggage Inspection System with a Domestic Baggage Carousel Device and split components 3 and 4 into subcomponents, as shown in the table entitled “Exhibit A - Revised Scope of Work” below.

Page 3TBITEC DA-5158 First Amendment 10-26-19

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Exhibit A - Revised Scope of Work

Scope Component DescriptionTemporary Sortation & Make-Up Facility Design and installation of a temporary sortation

and make-up facility to support existing TBIT operations before the Midfield Satellite Concourse or North Baggage Handling Facility are operational.__________________________

1.

Domestic Baggage Carousel Device Design and construct a new domestic baggage claim carousel in the TBIT Arrivals Hall to include the following: Provide and preserve a functional airside induction belt to the new Bag Claim Carousel throughout all stages of the TBITEC Baggage Optimization Program Phases 1 and 2; and provide all necessary infrastructure for the new carousel

2.

MSC Early Bag Storage, Baggage Sortation & Make-Up

Design and installation of Early Baggage Storage, sortation and make-up systems at the MSC that connect to the new Individual Carrier System (ICS) from the West Tunnel.

3-A

Individual Carrier System from TBIT to MSC

Design and installation of an Individual Carrier System (ICS) for outbound baggage delivery and empty carrier returns between TBIT and MSC via new underground transition facility, East and West tunnels.

3-B

North Baggage Handling System Building (NBHS) Early Bag Storage, Baggage Sortation & Make-Up

Design and installation of Early baggage Storage, sortation and make-up systems at the NBHS that connect to the new Individual Carrier System (ICS) from the North Tunnel.

4-A

Individual Carrier System from TBIT to NBHS

Design and installation of an Individual Carrier System (ICS) for outbound bag delivery and empty carrier returns between TBIT and NBHS via new underground transition facility, East, West, and North tunnels.__________________

4-B

The proposed Amendment also makes minor administrative changes to clarify certain definitions and construction reporting requirements. The term of Equipment Acquisition Agreement DA-5158 and the maximum acquisition cost of $185,000,000 remain unchanged.

How this action advances a specific strategic plan goal and objective

This action advances this strategic goal and objective: Deliver Facilities & Guest Experiences that are Exceptional: Upgrade every element of the quest experience. Amending the Agreement will allow installation of an expanded domestic bag claim device in TBIT. Replacement of the existing flat-plate baggage claim device with a new larger device appropriately sized to support the range of aircraft operating at TBIT and TBIT West gates will increase capacity and serve the growing demand for domestic and pre-clear operations in TBIT West.

Page 4TBITEC DA-5158 First Amendment 10-26-19

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Action Requested

Staff requests the Board approve the First Amendment to Equipment Acquisition Agreement DA-5158 and authorize the Chief Executive Officer to execute the First Amendment upon approval as to form by the City Attorney and upon approval by the Los Angeles City Council.

Fiscal Impact

The Midfield Satellite Concourse-TBIT Baggage Enhancements Project is an approved capital project at LAX that includes the cost of this Equipment Acquisition Agreement. Funds in an amount not to exceed $185,000,000 were appropriated and allocated from LAX Revenue fund to WBS Element 1.17.15A -700 for the installation of the baggage handling system equipment for the Midfield Satellite Concourse by the Board on November 17, 2016, pursuant to Board Resolution No. 26115. Approval of the First Amendment will not increase the maximum acquisition cost of the Agreement. Capital costs incurred on this project are recovered through terminal rates and charges.

4. Alternatives Considered

• Take No ActionNot changing the scope of the components would not allow LAWA to improve the domestic baggage claim device in a timely manner to meet the needs of increased domestic baggage operations anticipated at TBIT after the opening and movement of new airlines into the MSC.

• Not splitting Components 3 and 4Not splitting components 3 and 4 into sub-components will delay acquisition of these parts, and result in increased accrued interest charges.

APPROPRIATIONS:

Staff does not request a new appropriation of funds for this item.

STANDARD PROVISIONS:

The issuance of permits, leases, agreements, gate and space assignments, and renewals, amendments or extensions thereof, or other entitlements granting use of existing airport facilities or its operations is categorically exempt from California Environmental Quality Act (CEQA) requirements pursuant to Article III, Class 1 (18)(c) of the Los Angeles City CEQA Guidelines.

1.

This proposed document(s) is/are subject to approval as to form by the City Attorney.2.

Actions taken on this item by the Board of Airport Commissioners will become final pursuant to the provisions of Los Angeles City Charter Section 373.

3.

This action is not subject to the provisions of the Service Contractor Worker Retention and Living Wage Ordinances.

4.

This action is not subject to the provisions of the SBE Program.5.

This action is not subject to the provisions of the Affirmative Action Program.6.

Page 5TBITEC DA-5158 First Amendment 10-26-19

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7. This action does not require a Business Tax Registration Certificate.

8. This action is not subject to the provisions of the Child Support Obligations Ordinance.

9. This action is not subject to the insurance requirements of the Los Angeles World Airports.

10. This action is not subject to the provisions of City Charter Section 1022 (Use of Independent Contractors.

11. This action is not subject to the provisions of the Contractor Responsibility Program.

12. This action is not subject to the provisions of the Equal Benefits Ordinance.

13. This action is not subject to the provisions of the First Source Hiring Program.

14. This action is not subject to the provisions of Bidder Contributions CEC Form 55.

15. This action is not subject to the provisions of the Iran Contracting Act.

Page 6TBITEC DA-5158 First Amendment 10-26-19