Port of Pasco approves contract for airport work

Port of Pasco commissioners took the plunge Thursday, committing to start a $43.7 million remodel of the Tri-Cities Airport terminal this summer.

And a $6 million grant from the Federal Aviation Administration appears likely, meaning commissioners might include parts of the project that were taken out earlier to lower the cost.

The port still might consider upping the daily parking fees by a dollar per day to provide a cushion, just in case.

Commissioners unanimously approved a contract with Bouten Construction Co. for the full remodel project, which will almost double the terminal's size.

Construction is expected to start by Aug. 1, said Randy Hayden, the port's executive director.

The terminal's staircase and restrooms will be moved to the front of the building to open up the area near the security checkpoint. Security, ticketing and baggage areas also would be expanded. A new concourse beyond the security area will feature a view of the airfield, with gates to the right and left.

Overall construction costs are limited to $31.7 million by the approved contract. Bouten Construction is responsible for any cost overruns. Contractor's fees, architect and engineering fees, furniture and fixtures and contingencies will account for the other $12 million of the project's cost.

The construction contract is contingent on the federal funding coming through and bonds being issued, Hayden said.

The port should hear back on the $6 million discretionary grant sometime next month, said Ron Foraker, airport director.

Bouten Construction will put subcontracts out to bid for the project, with those contracts likely to be awarded in June, Hayden said. The company has to use the same formal bidding process the port would use, but the contracts do not necessarily need commissioner approval.

Commissioners did not decide Thursday if other features axed because of cost would be added back into the project. Hayden said they can be added back in once the subcontractor bids are received. Port officials have already added back an inbound baggage carousel, included as part of the $43.7 million.

The remaining features would cost about $1.5 million extra. That includes expanding Gate 5, renovating the corridor and bathroom on the second floor and replacing the pavement in the short-term parking lot.

Port Commissioner Jean Ryckman said those features won't cost any less if they are put off until later. Finishing it all now should be considered as long as it won't harm the port's ability to go after other economic development opportunities, she added.

Doing it all would mean issuing $27.4 million in bonds, Hayden said. The annual debt payment would be about $2.2 million.

Port officials plan to pay the annual bond debt using $1.1 million from the passenger facility charges on airline tickets and other airport revenue, said Linda O'Brien, the port's director of finance and administration.

The overall cost does not include improvements in the planned restaurant and concessions space. That's something port officials will ask the future concessionaire to pay for, at an estimated cost of about $2.2 million. The concession contract expires in February 2017, but officials want the future concessionaire to get involved in the project soon.

Tailwind, a concessionaire at 10 U.S. airports, and current concessionaire Florentyna's submitted proposals, Foraker said. He hopes to bring a recommendation to the commission in May.

The decision on increasing parking fees also will wait. Raising the parking lot fees could give the port greater confidence in including all of the additional features, Hayden said. But staff wants to do more analysis before making a firm recommendation. It's not uncommon for airports to use parking fees to help fund major renovations.

O'Brien said increasing long-term parking by $1 -- to $10 a day -- would add about $200,000 in revenue each year that could be earmarked for the terminal project.

That's taking into account the airport would see some decreased usage with higher fees, she said. When the port added $2 a day to the parking lot fees, cars dropped by 2 percent, but overall revenue climbed by $500,000 a year.

Republic Parking System, the parking lot operator, feels the increased rate would still be acceptable, Hayden said. While it looks like the port could pay for it all without the additional fees, the added dollars could be set aside as a reserve for future bond payments.

Ryckman suggested waiting on an increase and using that as a fallback. But O'Brien said it only works as a fallback if it has time to build up some savings.

Short-term parking, at $12 per day, would also need to be increased to maintain the price gap, Foraker said. But the port does not expect additional revenue from that lot.

The FAA also will build a new home for the FAA-owned VOR, or Very High Frequency Omnidirectional Range radio beacon, which is used for navigation. It is in the way of the new concourse.

The old VOR likely still will be there when the terminal construction begins, Foraker said. The port will be able to start construction on the apron before the relocation process is finished.

-- Kristi Pihl: 582-1512; kpihl@tricityherald.com