THE AVIATION DEPARTMENT RECOMMENDS APPROVAL OF THE ABOVE MOTION.
This action will amend the Second Addendum to the Signatory Terminal Building Lease Agreement ("Signatory TBLA") to provide funding for additional scope to modernize additional areas for the T2 Modernization Project, extend the contract time to 1825 days, and modify certain terms and conditions of the Addendum.
This item supports the Board's Value for "Ensuring economic opportunities for all people and businesses in Broward County," its Goal to "Increase the economic strength and impact of revenue-generating County enterprises balancing economic, environmental, and community needs" and its Objective to modernize passenger facilities in Terminals 2 and 3 at FLL.
The Office of Economic and Small Business Development (“OESBD”) established a Community Business Enterprise (“CBE”) goal of 15% for this project. Delta Air Lines, Inc. (“Delta”) has committed to 15% CBE participation. Although construction has not begun, Delta has been paid $3,656,067 and has paid its sub-contractors $337,097, for 9.22% CBE participation (Exhibit 3).
On September 27, 2011 (Item No. 62), Motion B: the Board approved the Signatory TBLA between Broward County and Delta, commencing for a period of five years, expiring on September 30, 2016. On April 5, 2016 (Item No. 42), the Board approved the Fourth Amendment to the Signatory TBLA between Broward County and Delta, which extended its term for ten years, expiring on September 30, 2026.
On June 12, 2012 (Item No. 2), Motion B: the Board approved the First Addendum to the Signatory TBLA between Broward County and Delta to provide for the design, construction and installation of an In-Line Baggage System in T2 at FLL. This was a separate project which was completed in 2014.
On April 5, 2016 (Item No. 42), Motion C: the Board approved the Second Addendum to the Signatory TBLA for Delta to administer and oversee the construction of the T2 Modernization Project, in the amount of $110,000,000.
T2 was built in the early 1980s and has undergone minimal improvements throughout the years with the exception of the In-Line Baggage System completed in 2014, which included the renovation and reconfiguration of the ticketing check-in area. Other minor facility renovations included replacement of an escalator, replacement of facility finishes and renovated concession spaces.
The existing scope of the T2 Modernization Project will add an airside mezzanine level Delta Sky Club, replace and renovate all concession and retail spaces, relocate and expand the security checkpoint, relocate and/or add vertical circulation, replace carpet with decorative terrazzo, renovate and expand restroom facilities to include family restrooms, add a pet relief area, replace and upgrade HVAC system and facility lighting, replace gate podiums and replace and upgrade all facility signage. The project will also include the realignment of ramp level airside operation spaces occupied by various tenants, including Airlines, the Broward Sheriff's Office, Transportation Security Administration and Broward County Aviation Department ("BCAD").
As the T2 Modernization Project progressed through the preconstruction phase of the work and the proposed Airport Master Plan, discussions occurred on the connectivity of the concourses throughout the airport campus. BCAD staff determined that terminal connectors were necessary to connect Terminal 1 (“T1”) and T2, and T2 and Terminal 3 (“T3”). In July 2017, the Airline-Airport Affairs Committee voted to approve the terminal connector project.
The addition of post-security terminal connections from T1 through Terminal 4 (“T4”), will allow passengers access to all concourses for inter-terminal connecting flights and provide better utilization of the overall facility. By enhancing connectivity between the terminals, passengers will be able to travel smoothly between concourses A through G for both gate access and concession options. Connectivity of the concourses will increase revenue generated by the concessions, increase square footage, and allow full utilization of each gate across all the terminals, enabling the Airlines to connect with their business partners in adjacent terminals.
The proposed First Amendment to the Second Addendum to the Signatory TBLA (“First Amendment”) is for an increase in the amount of $110,000,000 for Delta to perform additional modernization work in T2. The project consists of approximately $22,989,815 for modernization work and $87,010,185 for the associated terminal bump out (extensions) and two new terminal connectors. The estimated total cost of $110,000,000 is based on projections by Delta and BCAD.
Funding for the additional work to modernize areas of T2 will provide for additional design and security enhancements, gate and temporary concession relocations, structural updates, skylight replacements in the ticket lobby, ramp restroom renovations for Americans with Disabilities Act compliance and a new elevator. Funding for the additional work will also provide for the extension of program management services, preconstruction activities, phasing modifications, building code and engineering updates, revised maintenance standards and product updates. In addition, the funding will allow for an increase in the Owner’s Allowance Account in the amount of $7,500,000 to provide for necessary changes. Funding will also provide for construction cost increases, and project-related costs between Delta and their contractors in accordance with the terms of the Addendum, not included in the construction contract and the program manager contract. The additional work and associated costs to modernize T2 are estimated to be $22,989,815.
In addition to the modernization work outlined above, Delta will complete the terminal bump outs to T1 and T2, and construct two new terminal connectors; one connecting T1 to T2, and one connecting T2 to T3. The terminal bump out work will expand and structurally modify the building footprint on the west side of T1 and east side of T2 to support the new T1-T2 terminal connector. The work will also expand the building footprint on the west side of T2 to support the new T2-T3 terminal connector. The enhanced design includes renovation of the T2 baggage claim area, the addition of two new baggage claim devices and upgrade of three existing baggage claim devices. The work also includes relocation of restrooms and the Airline Tenant Office, relocation and upgrade of a lift station, expansion of the checkpoint queuing area, airside and landside tenant operation spaces, the addition of a new Florida Power and Light vault room and a new chiller. In addition, work includes replacement of the baggage claim ceiling and lighting, upgraded signage throughout the baggage claim area, and new directional signage to assist passengers with terminal connector access. Work also includes new carpet and terrazzo finishes, new stairwells, aircraft parking modifications, expansion of the closed circuit television system and expansion of the Access Control system.
Delta will complete the new terminal connectors between T1 and T2, and T2 and T3; which are new secure airside connections accessible to passengers only after checkpoint screening. The associated construction consists of a new structure and foundation, civil and electrical improvements, potential airside tenant operation spaces, new carpet and terrazzo finishes, and new ceiling and lighting. The cost for the additional work for the bump out areas and terminal connectors is estimated to be $87,010,185.
JetBlue Airways Corporation (JetBlue) will complete the terminal bump out to the east side of T3 to interface with the new terminal connector between T2 and T3, as outlined in the Fourth Amendment to the Addendum to the Signatory TBLA, to be presented to the Board in conjunction with this action. Coordination between Delta and JetBlue will continue to ensure the seamless interface of the bump out and the terminal connector between T2 and T3.
These projects are an operational necessity to allow for continued Airport growth and will upgrade the level of service in T2 to be consistent with the level of service in T1, T3 and T4. The projects were coordinated with the current Terminal Master Plan concepts, and will provide increased space and an enhanced customer experience. The additional work will add 95,917 square feet to the T2 Modernization Project, increasing the estimated square footage from 217,460 square feet to 313,377 square feet. Construction is estimated to begin in summer 2018 and be completed by the end of 2022.
The First Amendment also modifies certain terms and conditions of the Second Addendum, including ratification of the Construction Agreement with Delta and Turner Construction Company (Exhibit 2; Exhibit J), and ratification of the Program Management Services Agreement with Delta and PM Technologies, Inc. (Exhibit 2; Exhibit J-2).
Approval of the First Amendment extends the contract time from 1276 days to 1825 days, effective upon award and execution of the Construction Agreement or determination of the Final Guaranteed Maximum Price, to allow for substantial completion of the work. In addition, the First Amendment increases the Second Addendum amount by $110,000,000 for a revised total Addendum amount of $220,000,000.
In accordance with the terms of the Second Addendum to the Signatory TBLA, Delta will comply with Broward County’s competitive bidding process and contract requirements such as the CBE Program. Also, BCAD staff will continue to provide oversight of the project through weekly project meetings and approval of invoices.
The proposed First Amendment has been reviewed and approved as to form by the Office of the County Attorney and the Risk Management Division.
The amounts referenced in this agenda have been rounded to the nearest whole dollar. Vendor payments will be based on the maximum amount payable under the Addendum. The Agreement Summary Sheet reflects the actual amount of the award.
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