BOARD OF AIRPORT COMMISSIONERS

Transcription

1 I ELy RW BY KV -4.01, 110%,ii ". 1 Los Angeles World Airports REPORT TO THE BOARD OF AIRPORT COMMISSIONERS I. Approved by: GI -g S. Campbell, Chief Airports Engineer II Meeting Date: 10/18/ Completed Reviewed by: Cy. th'a Guidry, eput. Executive Director CAO Review: Pending -----"..-- A.1) N N/A Reviewed for Date Approval Status I Ilaty At ilk Finance 10/5/2018 NY N NA I / CEQA 9/13/2018 1=IY N I JH Deb. -,71:111ak.. - Chief E 4-cutive Officer Procurement 9/14/2018 Guest Experience 10/2/2018 Y ON 0 Cond I NY ON 1 MT Strategic Planning 9/13/2018 NY N NA I SUBJECT: Approve Change Order No. 120 to Contract No. DA-4971 with Turner PCL, a Joint Venture, to incorporate construction modifications within the Passenger Tunnel for the Midfield Satellite Concourse Project. Approve Change Order No. 120 in the not-to-exceed amount $1,556,698 to Contract No. DA with Turner PCL, A Joint Venture, to incorporate construction infrastructure modifications to accommodate twenty-four (24) digital display locations within the Midfield Satellite Concourse Passenger Tunnel. RECOMMENDATIONS: Management RECOMMENDS that the Board of Airport Commissioners: 1. ADOPT the Staff Report. 2. DETERMINE that this action is exempt from the California Environmental Quality Act (CEQA) pursuant to Article II, Section 2.i of the Los Angeles City CEQA Guidelines. 3. APPROVE Change Order No. 120, to incorporate construction infrastructure modifications in the Midfield Satellite Concourse Passenger Tunnel, in the not-to-exceed amount of $1,556, AUTHORIZE the Chief Executive Officer to execute Change Order No. 120 with Turner PCL, a Joint Ventures MSC PAX Wall Change Order Page 1

2 DISCUSSION: 1. Purpose The proposed Change Order authorizes owner betterment modifications to the Midfield Satellite Concourse-North facility (MSC) passenger tunnel. The recommended modifications provide design and modifications to the infrastructure to incorporate twentyfour (24) digital display locations in the passenger tunnel to increase advertising revenue and improve the guest experience for passengers walking between Tom Bradley International Terminal (TBIT) and the MSC. 2. Prior Related Actions December 18, Resolution No (DA-4971) The Board awarded a Two Phase Design-Build Contract to Tuner PCL, a Joint Venture (TPJV), for the MSC Project at LAX, for the cost of $961,270,169; and appropriation of $174,889,794. February 18, Resolution No (DA-4971) The Board approved an Administrative Change Order to Contract DA-4971 with TPJV to reallocate design funds of $27,481,340 covering the MSC Project at LAX; and include certain administrative changes. August 18, Resolution No (DA-4971) The Board approved an additional appropriation of capital funds in the amount of $59,077,469 for CGMP Early Work Package Scope Elements of the MSC Project at LAX. November 17, Resolution No (DA-4971) The Board approved a Guaranteed Maximum Price Change Order No. 6 in the amount of $355,337,070 and the appropriation of capital funds in the total amount of $1,317,235,766 to TPJV for the Design and Construction costs of the MSC Project. July 11, Resolution No (DA-4971) The Board approved Change Order Nos. 97 and 98 to incorporate design and construction modifications to the Electrical Substation No. IS-5474 and to allow for future Group III Aircraft operations at the MSC. 3. Current Action The MSC tunnel provides connectivity for passengers walking between TBIT the MSC. The tunnel is approximately 1,000 feet (0.2 miles) long with no windows. There is currently no planned commercial use of the space in the tunnel. Other than a decorative ceiling, there are no other visual attractions for the tunnel, making it a very generic and dull. As such, the passenger journey through the tunnel will be uneventful and seem much longer to the guest than it is. In order to improve the guest experience, make the journey throughout the tunnel more entertaining and increase revenue, digital monitors are planned to be installed along the length of the tunnel on the secure side. Page 2 MSC PAX Wall Change Order.docx

3 These digital monitors would be installed and operated by JCDecaux North America (JCDecaux), using the same system used for the great hall and clock tower in TBIT. These digital monitors would display entertainment content, airport service messages, visual art, and advertising. LAWA staff reached agreement in principle with current advertising firm, JCDecaux, for them to invest approximately $1,200,000 to purchase and implement the digital monitors. JCDecaux will offset the capital cost of the monitors through the sale of advertising displayed in the tunnel. LAWA will also receive a revenue share of this advertising per the current JCDecaux agreement. As the current JCDecaux agreement terminates in 2020, LAWA agreed in principle that if LAWA's option to extend the agreement for three more years through 2023 is not exercised, LAWA would purchase the unamortized cost of the monitors from JCDecaux. Since this is a new feature, the installation of the digital monitors will require additional data and power feeds to the tunnel walls. This installation will support digital monitors in the secure area and, pending an agreement with Customs and Border Protection (CBP). It will also support digital monitors on the sterile side at some point in the future. TPJV estimated the design and installation of the power and data infrastructure and modifying finishes in the tunnel walls will cost $1,556,698. This request is for approval of a change order to allocate this amount from the contingency for this MSC owner betterment. The business value justification for adding the digital monitors to the MSC tunnel results in a positive net present value with payback in just over 4 years. The approximately $1,000,000 in revenue estimated to be generated each year through advertising in the MSC tunnel would enable payback of the $1,556,698 for the above infrastructure, allow JCDecaux to recover the cost of the monitors, and provide additional revenue to LAWA. Page 3 MSC PAX Wall Change Order docx

4 JCDecaux and the MSC design team created the conceptual design that will add the following infrastructure and finishes: Installation of twenty-four (24), 20AMP power circuits, (one circuit to support each monitor niche as well as future monitor on sterile side of wall niche) and two (2) single gang duplex power receptacles in an electrical recessed wall enclosure box at each wall niche. Design services, including data provisions from the nearest LAWA Information Technology (IT) room to the twenty-four (24) digital display locations. Construction of the center dividing wall, within the passenger tunnel to support the video wall monitors. The estimated costs for these services are: Design and Construction of Electrical and low voltage services $ 798,760 Architectural Modifications and Finishes $ 424,871 TPJV Insurance, Bonds and Fees $ 333,067 Total $1,556,698 Coordination with LAWA stakeholders is underway, and construction will begin in October 2018 through August Using the Commercial Development Group (CDG) advertisement contract, JCDecaux will procure and install (24) 100" video wall monitors and necessary mounting brackets, and coordinate the installation of IT network and video driver equipment. The final testing and commissioning of the video wall will be coordinated between JCDecaux and the IT Management Group. 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: Develop, maintain and operate first class facilities. Approving this Change Order allows the MSC Team to install the electrical and digital infrastructure to support (24) 100" digital monitors. The digital monitors will provide entertainment content, airport service messages, visual art and advertising, to enhance the guest experience as passengers pass through the tunnel to their gates. Action Requested Staff requests the Board approve Change Order No. 120 to Contract No. DA-4971 with TPJV in the not-to-exceed amount of $1,556,698 for the construction of infrastructure modifications at the MSC passenger tunnel. Page 4 MSC PAX Wall Change Order. docx

5 Fiscal Impact The proposed Change Order will decrease the original owner contingency value previously authorized by the Board. Using the owner contingency is the most cost effective method to complete this work early, and realize revenue opportunities once the MSC opens. MSC Contract Value Summary Current Revised Contract Value $1,157,980,358 Proposed Change Order No ,556,698 Revised Contract Value $1,159,537,056 MSC Project Contingency Summary Approved Project Contingency $75,000,000 Authorized Cumulative Change Orders to Date -6,952,296 Current Project Contingency $68,047,704 Proposed Change Order No ,556,698 Remaining Owner Contingency $66,491, Alternatives Considered Take No Action Taking no action will continue construction of the MSC without the necessary infrastructure in place to accommodate a future video wall in the passenger tunnel. Modified Scope Options Other digital media options were analyzed, but were found to be too difficult and/or too costly to install. The structural columns running down the middle of the tunnel make it difficult to install anything other than individual monitors in a cost effective manner. Working with JCDecaux to develop the proposed solution yielded the best economic option. Make the Modifications at a later date To make the above-mentioned modifications later, after completion of construction, will result in a significant increase to costs and operational coordination. This action would require overnight closures of the passenger tunnel for architectural, electrical and data modifications to the center dividing wall, resulting in significant impacts. APPROPRIATIONS: Staff requests that funding for Change Order No. 120 be withdrawn from the LAWA contract contingency previously approved and appropriated under Change Order No. 6, DA-4971 (Turner/PCL, A Joint Venture) and allocated in the not-to-exceed amount of $1,556,698 to WBS Element A-700 (Midfield Satellite Concourse) as may be required. Page 5 MSC PAX Wall Change Order. docx

6 STANDARD PROVISIONS: 1. Any activity (approval of bids, execution of contracts, allocation of funds, etc.) for which the underlying project has previously been evaluated for environmental significance and processed according to the requirements of the California Environmental Quality Act (CEQA) is exempt from further review pursuant to Article II, Section 2.i of the Los Angeles City CEQA Guidelines. The Midfield Satellite Concourse Environmental Impact Report (EIR) was certified by the Board of Airport Commissioners for this project on July 21, 2014 (Resolution No ). 2. The underlying contract was approved as to form by the City Attorney. 3. Actions taken on this item by the Board of Airport Commissioners will become final pursuant to the provisions of Los Angeles City Charter Section As this is a construction project, Turner I PCL, a Joint Venture will comply with the applicable provisions of the Living Wage Ordinance and the Labor Code of the State of California (Prevailing Wage). 5. Procurement Services Division reviewed this action (File No ) and established a mandatory 15% Small Business Enterprise goal for the Design Phase and a 15% Small Business Enterprise goal for the Construction Phase of the project. Turner PCL, a Joint Venture has committed to 15% SBE participation separately for both phases and has achieved 18.6% to date. 6. Turner I PCL, a Joint Venture is required by contract to comply with the provisions of the Affirmative Action Program. 7. Turner I PCL, a Joint Venture has been assigned Business Tax Registration Certificate Number Turner I PCL, a Joint Venture is required by contract to comply with the provisions of the Child Support Obligations Ordinance. 9. Turner I PCL, a Joint Venture has approved insurance documents, in the terms and amounts required, on file with Los Angeles World Airports. 10. Pursuant to Charter Section 1022, staff determined the work specified on the proposed contract can be performed more feasibly or economically by an Independent Contractor than by City employees. 11. Turner I PCL, a Joint Venture has submitted the Contractor Responsibility Program Pledge of Compliance and will comply with the provisions of the Contractor Responsibility Program. 12. Turner I PCL, a Joint Venture has been determined by Public Works, Office of Contract Compliance to be in compliance with the provisions of the Equal Benefits Ordinance. 13. Turner I PCL, a Joint Venture will be required to comply with the provisions of the First Source Hiring Program for all non -trade Airport jobs. 14. Turner I PCL, a Joint Venture has submitted the Bidder Contributions CEC Form 55 and will comply with its provisions. Page 6 MSC PAX Wall Change Order.docx