SAN FRANCISCO AIRPORT COMMISSION MINUTES. Tuesday, October 2, :00 A.M.

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1 SAN FRANCISCO AIRPORT COMMISSION MINUTES Tuesday, October 2, :00 A.M. Room 400 City Hall #1 Dr. Carlton B. Goodlett Place (400 Van Ness Avenue) City and County of San Francisco LONDON N. BREED, MAYOR COMMISSIONERS LARRY MAZZOLA President LINDA S. CRAYTON Vice President ELEANOR JOHNS RICHARD J. GUGGENHIME PETER A. STERN IVAR C. SATERO Airport Director C. CORINA MONZÓN Commission Secretary SAN FRANCISCO INTERNATIONAL AIRPORT SAN FRANCISCO, CALIFORNIA 94128

2 Minutes of the Airport Commission Meeting of Tuesday, October 2, 2018 CALENDAR SECTION AGENDA ITEM TITLE RESOLUTION NUMBER PAGE A. CALL TO ORDER:...5 B. ROLL CALL:...5 C. ADOPTION OF MINUTES:...5 No Regular meeting of October 2, D. SPECIAL ITEMS:...5 E. ITEMS INITIATED BY COMMISSIONERS: Discussion and vote to confirm the appointment of members nominated to serve on the Special Advisory Committee Concerning the Nomination of Edwin M. Lee for Naming or Dedication at the San Francisco International Airport. ACTION ITEM...5 No F. ACTION ITEMS RELATED TO ADMINISTRATION, OPERATIONS & MAINTENANCE Approval of Modification No. 1 to Contract No B with Hyatt Corporation for Pre Opening Services, to Add Scope and to Increase the Contract Amount by $1,400, No Award of the Terminal 3 Pop Up Retail Concession Program Space 2 Permit to Chalo, LLC...8 No Award of Professional Services Contract No to LeighFisher, Inc., to Provide Bond Feasibility Services, Air Traffic Analysis, and Financial and Capital Plan Management and Analysis, in an Amount Not to Exceed $3,565,000 for a Term of Five Years...9 No Approval of Phase C7 to Contract No Design Build Services for the Demolition of Terminal 2 Air Traffic Control Tower Project Turner Construction Company $6,831, Minutes, October 2, 2018, Page 2

3 No Approval of Phase D of Contract No. 8872A.66, Design Build Services for the Consolidated Administration Campus Phase 1 Project Webcor Construction LP dba Webcor Builders $6,292, No Approval of Phase C4 to Contract No. 8465C.66 for Design Build Services for Superbay Hangar Fire Suppression System Replacement Project The Weitz Company, LLC $36,754, No Approval of Phase C2 to Contract No Design Build Services for the International Terminal Checked Baggage Inspection System Modernization Program and Baggage Handling System Improvements Project Skanska USA Building, Inc. $5,948, No Approve Modification No. 5 to Contract No with Bombardier Transportation (Holdings) USA, Inc. for AirTrain Operations and Maintenance Services, to Extend the Term Four Months to June 30, 2019 and Increasing the Contract Amount by $5,143,268, for a New Total Not to Exceed Contract Amount of $135,442, No G. CONSENT CALENDAR OF ROUTINE ADMINISTATIVE MATTERS Approval of a 2011 Lease and Use Agreement with Icelandair ehf No Exercise of the Second of Two One Year Options to Extend the Term Under JRenee, LLC s Terminal 3 Boarding Area F Food and Beverage Kiosk Lease No No Commencement of the Request for Bids Process for the Domestic Parking Garage Food Truck Lease No Authorization to Issue Request for Qualifications No to Establish Pools of Investment Banks to Provide Investment Banking, Derivatives Counterparty and Related Services No Modification No. 1 to Contract No. 9313, with ThyssenKrupp Elevator Corporation, for Escalator and Electric Walk Maintenance increasing the Contract not to exceed amount by $2,500, Minutes, October 2, 2018, Page 3

4 No Approval of Modification No. 1 to Professional Services Contract No , Project Management Support Services for the International Terminal Building Refresh Project International Terminal Building Refresh Joint Venture (ITBR JV) $850, No Modification No. 2 to Contract No for Hardware Purchase, Software License, Integration, Support and Maintenance for the Physical Security Information Management and Video Management Systems Verint Security Intelligence, Inc. $660, No Award of Professional Services Contract No to DWU Consulting LLC, for Financial and Capital Plan Management and Analysis Services, in an Amount Not to Exceed $1,450,000 for a Term of Five Years...20 No H. NEW BUSINESS:...20 I. CORRESPONDENCE:...21 J. CLOSED SESSION:...21 K. ADJOURNMENT:...21 Minutes, October 2, 2018, Page 4

5 Minutes of the Airport Commission Meeting of Tuesday, October 2, 2018 A. CALL TO ORDER: The regular meeting of the Airport Commission was called to order at 9:00 A.M. in Room 400, City Hall, San Francisco, CA. B. ROLL CALL: Present: Absent: Hon. Larry Mazzola, President Hon. Linda S. Crayton, Vice President Hon. Eleanor Johns Hon. Richard J. Guggenhime Hon. Peter A. Stern C. ADOPTION OF MINUTES: The minutes of the regular meeting of September 18, 2018 were adopted unanimously upon a motion by Commissioner Johns and a second by Commissioner Guggenhime. No Regular meeting of September 18, D. SPECIAL ITEMS: There were no special items. E. ITEMS INITIATED BY COMMISSIONERS: There were no items initiated by Commissioners. Item No. 1 was approved unanimously by a motion by Commissioner Guggenhime and a second by Commissioner Johns. 1. Discussion and vote to confirm the appointment of members nominated to serve on the Special Advisory Committee Concerning the Nomination of Edwin M. Lee for Naming or Dedication at the San Francisco International Airport. ACTION ITEM No Resolution approving the Airport Commission President's nominees to the Special Advisory Committee to consider and recommend action on the nomination of Edwin M. Lee for naming or dedication at the San Minutes, October 2, 2018, Page 5

6 Francisco International Airport: (1) Larry Mazzola, President, San Francisco Airport Commission (2) Linda S. Crayton, Vice President, San Francisco Airport Commission (3) Eleanor Johns, Commissioner, San Francisco Airport Commission (4) Peter A. Stern, Commissioner, San Francisco Airport Commission (5) John L. Martin, Former Airport Director, San Francisco International Airport (6) Anni Chung, President and CEO, Self Help for the Elderly, San Francisco (7) Melinda Yee Franklin, Managing Director, Corporate and Government Affairs, Western Region, United Airlines (8) Anthony "Tony" Ribera, Former Chief of Police, City and County of San Francisco, Department Chair/ Assistant Professor, University of San Francisco (9) Candace Sue, Director of Communications and Marketing, San Francisco Municipal Transportation Commissioner Mazzola said alright so today this item is for us to confirm the nominees to serve on this Committee. The Nominees are the same as reported on September 4 th except for one name replacing Mr. Guggenhime who has a conflict of being able to serve because of doing work for the family s estate. Is that correct? Mr. Guggenhime responded that s correct. We we represent the Mayor s family in probate trust and administration. Commissioner Mazzola said so then we replaced Mr. Guggenhime with Ms. Candace Sue and she s currently with MTA. And I will serve as President of the Airport Commission. I will serve as President of this Naming Committee and will be sure that any recommendation going forward to the Board will be consistent with our Airport Commission Policy. So Commission Secretary, would you please read the names of the Nominees. Ms. Corina Monzón, Commission Secretary stated the first four members are members of the San Francisco Airport Commission: Larry Mazzola, President; Linda S. Crayton, Vice President; Eleanor Johns, Commissioner; Peter Stern, Commissioner. The other five nominees are: John Martin, Former Airport Director, San Francisco International Airport; Anni Chung, President and CEO, Self Help for the Elderly, San Francisco; Melinda Yee Franklin, Managing Director, Corporate and Government Affairs, Western Region, United Airlines; Anthony Tony Ribera, Former Chief of Police, City and County of San Francisco, Department Chair / Assistant Professor, University of San Francisco and Candace Sue, Director of Communications and Marketing, San Francisco Municipal Transportation Minutes, October 2, 2018, Page 6

7 Agency. Commissioner Mazzola said okay these committee meetings will take place immediately following a Commission meeting and we will announce it publicly because they are public meetings. So if anyone from the public wants to speak, they can do that. There was no further discussion. F. ACTION ITEMS RELATED TO ADMINISTRATION, OPERATIONS & MAINTENANCE Item No. 2 was approved unanimously by a motion by Commissioner Guggenhime and a second by Commissioner Johns. 2. Approval of Modification No. 1 to Contract No B with Hyatt Corporation for Pre Opening Services, to Add Scope and to Increase the Contract Amount by $1,400,000 No Resolution approving Modification No. 1 to Contract No B with Hyatt Corporation to add scope, to furnish and install information technology supplies and equipment for the Grand Hyatt at SFO and provide related services, and to increase the contract amount by $1,400,000. Good morning Commissioners, my name is Leo Fermin, Chief Business and Finance Officer. The Airport has a Pre Opening Services Agreement with Hyatt Corporation which covers services prior to the opening of the hotel. These include development of a marketing plan, the recruitment, hiring and training of personnel, pre bookings, office expenses, testing of equipment and systems in the building, and other tasks necessary to start up. This item before you approves Mod. No. 1 to this Agreement. This will enable Hyatt to purchase and install information technology and equipment throughout the hotel, such as sales and reservation systems, restaurant and bar point of sales systems, TV systems, guest room technology, accounting and finance systems, payroll systems, phone systems and so on. Originally, we intended to have this handled by our design build team, Webcor, Hornberger, Worstell. But as we completed the multiple partnering sessions, it became clear that Hyatt is much better suited to acquire these systems as Hyatt is more experienced and familiar with them. Hyatt can better identify which equipment and software will be most appropriate for the intended use. Hyatt will also be the party to operate and maintain the systems and address any warranty claims. In the last two years, Hyatt s corporate IT team has installed these types of systems in 12 different new Hyatt hotels around the world. I ll be happy to take any questions. Commissioner Guggenhime said I have a question. So if we re creating this extra $1.4 million, are you taking $1,400,000 off the design build agreement? Minutes, October 2, 2018, Page 7

8 Mr. Fermin responded originally we budgeted $740,000 in the design build contract valid they are we will not be spending that money. So we're projecting that at completion, what we will come in about $680,000 under the budget of $240 million. Commissioner Johns stated I had a similar question as to whether this was in the scope of our original budget? Mr. Fermin responded it was in the scope of the design build budget that we will not be spending those monies. The $740,000 that we spent. That we budgeted in that design build contract. Commissioner Johns said and when we move forward once it opens, who s responsible for the maintenance and upkeep, and any problems. Mr. Fermin responded Hyatt will be overseeing that. Commissioner Johns asked, who? Mr. Fermin responded the Hyatt. The new equipment systems will have a warranty period and certain items will have maintenance contracts but Hyatt will be responsible for overseeing all of the maintenance work. Commissioner Johns asked and paying for whatever? Or you said something? Mr. Fermin responded yes that s correct. It will be an operating expense of the hotel. Commissioner Johns said thank you. I have no further questions. Item No. 3 was approved unanimously by a motion by Commissioner Johns and a second by Commissioner Guggenhime. 3. Award of the Terminal 3 Pop Up Retail Concession Program Space 2 Permit to Chalo, LLC No Resolution awarding the Terminal 3 Pop Up Retail Concession Program Space 2 Permit to Chalo, LLC. Good morning Commissioners. I m Cheryl Nashir, Director of Revenue Development & Management and I m here this morning to seek your approval to Award a Pop Up Retail Permit for Space 2 to Chalo, LLC. We initially gained your approval to try a pop up retail program for five years and Chalo represents the last company we will award to under this initial five year trial period. In this latest RFP, we received five proposals and Chalo was scored the highest by the Evaluation Committee. They are a Seattle based company that Minutes, October 2, 2018, Page 8

9 will sell fun and whimsical products inspired by the City of San Francisco. Their products are mostly utilitarian, but they re creative and beautiful. They include things like bags, pouches, passport holders. Other storage items: Pillows, socks, mugs, and shirts. And they will be changing their designs out frequently and they all reflect the iconic San Francisco sights and sounds. The term of the lease is one year. Chalo will pay the greater of percentage rent or a minimum annual guarantee. They will also pay a fee that we call the tenant improvement reimbursement fee which represents a reimbursement to the Airport because we built the stores for the pop up program. The tenant moves in. They provide sometimes fixtures, definitely signage. Sometimes they ll do a light paint and patch but this is mostly turnkey operation. Of the 10 companies we have cycled through our pop up program assuming Chalo is the tenth, they will be the only non local company. The other nine that have gone through our program, have all been based in San Francisco. You will recall that we have limitations around these leases in terms of proposers have to have earned a minimum level of sales but also a maximum level of sales. And we also stipulate that operators may not have operated at SFO before. I purchased Chalo merchandise at Sea Tac Airport and I can tell you it s of high quality and it s quite adorable. I d be happy to answer any questions. There were no questions by the Commissioners. Item No. 4 was approved unanimously by a motion by Commissioner Johns and a second by Commissioner Guggenhime. 4. Award of Professional Services Contract No to LeighFisher, Inc., to Provide Bond Feasibility Services, Air Traffic Analysis, and Financial and Capital Plan Management and Analysis, in an Amount Not to Exceed $3,565,000 for a Term of Five Years No Resolution awarding Professional Services Contract No o7 to LeighFisher, Inc., to provide bond feasibility services, air traffic analysis, and financial and capital plan management and analysis, in an amount not to exceed $3,565,000 for a term of five years. Good morning Commissioners, Kevin Kone from Finance. We are seeking your approval this morning to Award Professional Services Contract No to LeighFisher, Inc. in an amount of $3,565,000 for a term of five years. Leigh Fisher will provide unique Airport Management Consulting services in the three following areas: Bond Feasibility where LeighFisher will prepare a Financial Feasibility report of the Airport s bond issues as part of the official statement. This report is typically reviewed by the bond rating agencies as part of the process of developing our Commission s bond rating as well as potential investors who purchased the Airport s bonds. Second area is in the Air Traffic Analysis where LeighFisher will develop Air Traffic forecasts, studies and Minutes, October 2, 2018, Page 9

10 data that may at times be required to support the Airport s financial forecast. Air Traffic forecast are included in the Financial Feasibility report and are critical to the annual Airline Rates & Charges. And lastly, in the area of Financial and Capital Plan Management and Analysis where LeighFisher will assist the Airport in developing and preparing indirect Cost Allocation plans which are required for federally funded projects. They ll also help the Airport prepare responses to draft Governmental Accounting Standard Board requirements and possibly help us with implementing those newly adopted procedures and requirements. Due to the very specialized scope of work for the Bond Feasibility and Air Traffic Analysis, there are no certified Local Business Enterprise firms with this expertise in this area. So the City s Contract Monitoring Division has granted the Airport a waiver for the Local Business Enterprise participation in these two areas. However, an LBE subconsultant goal of 5% has been established by the Contract Monitoring Division for the Financial and Capital Plan Management area services provided under this contract. I would welcome any of your questions. Commissioner Johns stated so I'm familiar with LeighFisher. I know they ve provided us with a lot of information in the past but I didn t realize they did bond work or were consultants for these bond statements. So I think that s one of my questions. And the second question is, are there any other contracts that we have with LeighFisher other than this one that we, is before us today? Mr. Kone responded I believe LeighFisher provided some Planning support to the Planning group other than this Airport financial forecasting work, on the Financial Feasibility report. So the LeighFisher. Well let me back up. These consulting firms have consolidated over the years and the firms that have provided that kind of work for us in the past, were actually acquired by LeighFisher a number of years ago. Commissioner Johns asked by the parent company? I was on their website last night kind of they are an international operation I take it. Mr. Kone responded yes. About 25 years, we use to be with a company called the John F. Brown Co. and they prepared the Airport s Financial Feasibility report for about 25 years. When the owner of that firm wanted to exit the industry, he sold his firm to LeighFisher. And so LeighFisher then took over that Financial Feasibility process. And have been doing that for the Airport for probably close to 10 years now. So they do have a history of doing. They were a competitor to the John F. Brown Co. They have been doing Financial Feasibility reports for just as long and we've been using them for the past 10 years. Commissioner Johns said okay thank you. There were no further questions from the Commissioners. Minutes, October 2, 2018, Page 10

11 Item No. 5 was approved unanimously by a motion by Commissioner Guggenhime and a second by Commissioner Johns. 5. Approval of Phase C7 to Contract No Design Build Services for the Demolition of Terminal 2 Air Traffic Control Tower Project Turner Construction Company $6,831,802 No Resolution approving Phase C7 to Contract No , Design Build Services for the Demolition of Terminal 2 Air Traffic Control Tower Project, with Turner Construction Company, to increase the contract capacity by $6,831,802 for a new total contract capacity amount of $76,762,529 and with no change to the contract duration. Good morning Commissioners. I m Judi Mosqueda with Planning, Design, and Construction. This item is for your approval of Phase C7 adding Trade Package Set No. 5 into our contract with Turner Construction for the Demolition of the T2 Air Traffic Control Tower Project. The Phase C7 approval will increase the contract capacity by $6.8 million for a new contract capacity amount of $76.8 million, with a corresponding amount of contingency, and with no change to the contract duration. The Project includes demolition of the existing Air Traffic Control Tower, and design and construction of a new office block on top of T2. The new floors may be used for a new airline lounge, office space, a new employee cafe, and a public observation deck. As you know, demolition of the old tower has been completed. Steel erection for the new floors is just beginning. This approval will provide for Trade Package Set No. 5 to be added into the contract. The Trade Package Set includes Fire Protection; Mechanical; Electrical; Special Systems; Roofing, Pavers and Waterproofing. The forecast for this contract is $82 million which falls within the budget of $84.1 million, and includes appropriate levels of contingency. The Project is on schedule to be substantially complete in August of The LBE goals for this contract are 24% for design services and 20% for construction services and Turner Construction is committed to meeting these goals. We recommend your approval and I ll be happy to answer any questions. There were no questions from the Commissioners. Minutes, October 2, 2018, Page 11

12 Item No. 6 was approved unanimously by a motion by Commissioner Johns and a second by Commissioner Guggenhime. 6. Approval of Phase D of Contract No. 8872A.66, Design Build Services for the Consolidated Administration Campus Phase 1 Project Webcor Construction LP dba Webcor Builders $6,292,568 No Resolution approving Phase D of Contract No. 8872A.66, Design Build Services for the Consolidated Administration Campus Phase 1 Project, with Webcor Construction LP dba Webcor Builders to increase the contract amount by $6,292,568 for a new contract amount of $80,500,000 and to increase the contract duration by 293 calendar days to a total of 1,331 consecutive calendar days, and authorize a decrease to the contingency amount by $4,565,559 for a new contingency amount of $1,000,000. Ms. Mosqueda said this item is for your approval of Phase D establishing the Guaranteed Maximum Price for our contract with Webcor Builders for the Admin Campus Phase 1 Project. The Phase D approval increases the contract capacity by $6.3 million for a new contract capacity amount of $80.5 million, and increases the contract duration for a total of 1,331 consecutive calendar days. It also includes a decrease to the contingency amount by $4.6 million for a new contingency of $1 million. The Project constructed a new multi use office building for consolidation of Planning, Design and Construction, Museums, and our ITT divisions. Two of the three divisions now occupy the building. Remaining work includes abatement and demolition of Building 670 and expanding the parking lot. This approval establishes a Final Guaranteed Maximum Price (GMP) amount sufficient to assume the remaining risk to complete the Project, with cost components as follows: 1) We have unawarded base contract scope; 2) Pending additional scope and trends; 3) Trade Package Allowances for other anticipated scope; and 4) Trade Package Set Reserves, which is the Contractor s contingency to cover any obligation it has under the Final GMP including scope gaps, design errors and omissions, construction coordination costs, cost increases due to market conditions, and non Airport initiated design changes or clarifications. The forecast for this contract is $81.5 million which is within the contract budget of $81.5 million. This budget includes, as I mentioned earlier, $1 million in Airport controlled contingency for unforeseen circumstances related to remaining work to be performed. The Airport extends the Project completion date from July 24, 2018 to May 13, 2019 to complete administrative actions prior to Final Completion. Milestone 1 of the Project, completing the building, was achieved on June 25, Milestone 2 of the Project, being that demolition of building 670 and adding the remaining parking, is on track to achieve substantial completion by January 4, The LBE goals for this contract are 25% for design services and 21% for construction services and Webcor is committed to meeting these goals. We recommend your approval and I d be happy to answer any questions. Minutes, October 2, 2018, Page 12

13 Commissioner Mazzola said thank you for your report. There were no questions from the Commissioners. Item No. 7 was approved unanimously by a motion by Commissioner Johns and a second by Commissioner Guggenhime. 7. Approval of Phase C4 to Contract No. 8465C.66 for Design Build Services for Superbay Hangar Fire Suppression System Replacement Project The Weitz Company, LLC $36,754,993 No Resolution approving Phase C4 to Contract No. 8465C.66, Design Build Services for the Superbay Hangar Fire Suppression System Replacement Project, with The Weitz Company, LLC, to increase the contract capacity by $36,754,993 for a new contract capacity amount of $73,894,358, and authorize a corresponding contingency amount, with no change to the contract duration. Good Morning Commissioners. I am Geoff Neumayr, Chief Development Officer for the Airport. This request is for your approval of Phase C4, with no scope revisions or changes to the Weitz Company s Design Build contract for the Superbay Hangar Fire Suppression System Project. Commissioner Guggenhime announced can you speak in the microphone? Thank you. Mr. Neumayr responded I will do that. Sorry Commissioner. To increase the contract amount by $36.8 million and to establish a new contract capacity amount of$73.9 million and with a corresponding amount of contingency authorization. This contract provides for the Design Build Services for the design and construction of the Superbay Hangar Fire Suppression System Project which includes the design and construction for the replacement of the existing non compliant fire suppression system. This Phase C4 approval provides for adding of Trade Package Set No. 3 to the contract. Trade Package Set No. 3 includes the remediation, Civil Work, Electrical, Foundations, Structures, & Fire Alarm & Control work. This trade package remains within the overall budget and has been negotiated. This previously approved contract budget for this contract is $76.4 million. The forecasted budget needs for this contract have increased as a result of changes in the flood plain map and unforeseen conditions related to hazardous material. This contract budget increase was funded by contingencies and does remain within the overall capital program budget. The current contract forecast is $76.4 million. The projected forecast is within the revised contract budget and appropriate levels of contingency remain. The project is funded from the Airport s approved five year Capital Program. Staff will return to the Commission for approval of all remaining Trade Packages. Minutes, October 2, 2018, Page 13

14 The City s Contract Monitoring Division has approved a 23% LBE sub contracting goal for design services and a 20% LBE subcontracting goal for construction services. The Weitz Company is committed to meeting these contract goals. We recommend your approval and I would be happy to answer any questions you might have. There were no questions from the Commissioners. Item No. 8. was approved unanimously by a motion by Commissioner Guggenhime and a second by Commissioner Johns. 8. Approval of Phase C2 to Contract No Design Build Services for the International Terminal Checked Baggage Inspection System Modernization Program and Baggage Handling System Improvements Project Skanska USA Building, Inc. $5,948,308 No Resolution approving Phase C2 to Contract No , Design Build Services for the International Terminal Checked Baggage Inspection System Modernization Program and Baggage Handling System Improvements Project, with Skanska USA Building, Inc., to increase the contract capacity by $5,948,308 for a new contract capacity amount of $35,070,179, and to authorize a corresponding contingency amount, with no change to the total contract duration. Ms. Mosqueda said good morning Commissioners. This item is for your approval of Phase C2 adding Trade Package Set No. 3 into our contract with Skanska for the International Terminal CBIS Modernization Program. The Phase C2 approval will increase the contract capacity by $5.9 million for a new contract capacity amount of $35.1 million, with a corresponding amount of contingency, and with no change to the contract duration. The Project will replace equipment and systems that are beyond their useful life and impact the reliability of the Baggage Handling System within the International Terminal and its associated Boarding Areas. The Project will also address the Airport s passenger growth with improved reliability, redundancy, and capacity for the Baggage System. This approval will provide for Trade Package Set No. 3 to be added into the contract. The package includes Electrical, Low Voltage and Baggage Handling Controls subcontractors to facilitate enabling work. The forecast for this contract is $80.4 million which falls within the contract budget of $83.1 million. The project remains on schedule to be substantially complete in July, While there are no specifics small business participation, there is no specific goal for this contract because its federally funded. The Airport has set an Airportwide goal of 40% small business participation and Skanska is committed to meeting this goal. We recommend your approval and I would be happy to answer any questions. Minutes, October 2, 2018, Page 14

15 Commissioner Johns asked so is this simply replacing all of the equipment but what about the software or the computerized parts of handling baggage? Ms. Mosqueda said I believe it handles controls as well as the hardware component of this project. This project is focused on the checked bag inspection system equipment as well as making changes to the conveyor system and it includes the controls associated with it. Commissioner Johns said so the fact that we re upgrading all of this. I think we were sent an article recently about the future is that you can take your phone and track your bag all along the process and you know where it is or perhaps even where its lost. And I m just curious about that aspect not the construction part but the other part. Ms. Mosqueda said we ve been talking a lot about that at the Airport. This project does not include that technology. The technology that we re installing in Terminal 1 allows for that better tracking real time tracking of bags. Commissioner Johns asked why would we not do that in this project or is there the opportunity to do that after the fact? Ms. Mosqueda said I believe there is the opportunity to add that to the system in at future points and time. Thus the contract started a couple of years ago and it just isn t part of the scope of work for this work. Commissioner Johns said well I mean I would just like to understand are we spending all of this money and then we re still able to upgrade this or is there not some way to deal with that issue now rather than a year from now? Ms. Mosqueda said well let me ask Geoff what he knows about this as well? Mr. Neumayr said so the primary purpose for this contract is from the TSA. They are replacing the screening equipment. They re moving up from a series of 9,000 to 9,800 which are different systems, a much faster system. But that requires different programming its rotation up fronted those machines and the primary focus of this contract that is funded by TSA which they, is to increase that rotation sufficiency to meet those needs. This will give us higher processing of bags and also a higher degree of reliability. The reason in the future there will be tracking of the bags, the system that s in place right now still uses the bag tags and scanning. And it s not completely 100% reliable in that tracking system. That s why there s a lot of checks and balances in this. Such as Terminal 1 we re moving towards a container system where they ll actually have actual labels and have an idea attached to things. So they ll be able to track more and as we see more of that going on in that implementation going on throughout the industry, there will be an adaptation of the Airport systems. But we re not quite ready yet as an industry to take that but it is absolutely coming where we ll be able to track that much in a very reliable way to keep track of that. But this contract does not focus on that technology but that is always Minutes, October 2, 2018, Page 15

16 open and once everything catches up. Commissioner Johns asked so what we re doing now doesn t hinder us in anyway? There s nothing that we have to do infrastructure wise to make this new technology in a year from now able to be adapted to this current system? Mr. Neumayr said it doesn t impact in anyway. This is strictly optimization of the system for reliability for TSA to keep track of the bags and increase this sortation to meet the equipment that they provide to us. And that s the primary focus of this contract. Commissioner Johns said okay I ll keep that in mind. Thank you. Item No. 9 was approved unanimously by a motion by Commissioner Crayton and a second by Commissioner Johns. 9. Approve Modification No. 5 to Contract No with Bombardier Transportation (Holdings) USA, Inc. for AirTrain Operations and Maintenance Services, to Extend the Term Four Months to June 30, 2019 and Increasing the Contract Amount by $5,143,268, for a New Total Not to Exceed Contract Amount of $135,442,464 No Resolution authorizing Modification No. 5 to Contract No. 8838, AirTrain Operations and Maintenance, with Bombardier Transportation (Holdings) USA, Inc., extending the term of four months to June 30, 2019 and increasing the contract amount by $5,143,268 for a new total contract amount not to exceed $135,442,464. Good morning Commissioners. I m Eva Cheong, the Director of Airport Services. This morning we are seeking your approval to extend Contract 8838 with Bombardier Transportation Holdings USA, Inc. for the operation and maintenance of the AirTrain system for four months, through June 30, Bombardier installed the current AirTrain system and has been providing all services to operate and maintain the system since its opening in March of 2003 and under this contract since It is a proprietary system that is operated with Bombardier equipment. As you are aware, we are in the midst of extending the track to the new long term parking garage, adding 2 new stations on the route and upgrading the train controls. We will also be purchasing 3 additional train cars to adequately accommodate the additional stations and passengers. This requested contract extension will provide for operations and maintenance of the base system, including replacement parts, materials, tools and equipment associated with operating the AirTrain through June 30, The extension will allow us to align future contracts with the City s fiscal year and also allow additional time for Staff to adequately assess the cost and staff increases needed to meet the new AirTrain functions. Airport Staff will engage a third party to validate costs of any new pricing proposals against similar Airport transit systems prior to finalizing a recommendation. We plan to return to this Commission in the first quarter of Minutes, October 2, 2018, Page 16

17 next year to present a new long term contract for approval. Upon Commission approval of this 4 month extension in an amount of $5,143,268 and a new not to exceed contract amount of $135,442,268 million, we will take the necessary steps to receive Board of Supervisor s Approval. With that I d be happy to answer any questions. There were no questions from the Commissioners. G. CONSENT CALENDAR OF ROUTINE ADMINISTATIVE MATTERS The Consent Calendar, Item Nos. 10 through 17, was approved unanimously upon a motion by Commissioner Guggenhime and a second by Commissioner Crayton. 10. Approval of a 2011 Lease and Use Agreement with Icelandair ehf No Resolution approving a 2011 Lease and Use Agreement with Icelandair ehf at San Francisco International Airport, and directing the Commission Secretary to forward the Lease to the Board of Supervisors for approval. 11. Exercise of the Second of Two One Year Options to Extend the Term Under JRenee, LLC s Terminal 3 Boarding Area F Food and Beverage Kiosk Lease No No Resolution exercising the second of two one year options to extend the term under JRenee, LLC s Terminal 3 Boarding Area F Food and Beverage Kiosk Lease No Commencement of the Request for Bids Process for the Domestic Parking Garage Food Truck Lease No Resolution approving the proposed minimum qualification requirements and lease specifications, and authorizing Staff to issue a Request for Bids and conduct an informational conference for the Domestic Parking Garage Food Truck Lease. 13. Authorization to Issue Request for Qualifications No to Establish Pools of Investment Banks to Provide Investment Banking, Derivatives Counterparty and Related Services No Resolution authorizing the issuance of Request for Qualifications No to establish pools of investment banks to provide investment Minutes, October 2, 2018, Page 17

18 banking, derivatives counterparty and related services. Commissioner Johns said I just have a question on a term used in Item 13, authorization to issue request for qualifications to establish pools of investment banks. Its investment banks. I, is, I know what we're doing. We re getting consultants to help us with these investments, but the term banks there, I needed some explanation, I don t understand it. Mr. Kone responded the banks are the major Wall Street firms that the Morgan Stanleys, the JP Morgans, they are the ones that are helping us sell the bonds to the investors and in an event that we re, they are unable to find investors, they step in and underwrite the bonds and buy the bonds for us. Commissioner Johns said and so these, they are, that these banks they re actually acting as consultants for us? Mr. Kone responded they are acting as intermediaries between the Airport and the investor. So they are finding the investor for the Airport. They obtained the monies from the investors and then transfer those funds for the capital program back to the Airport. Commissioner Johns said I was confused as I read it. I didn t realize they were actually banking institutions that gave us this information. Thank you. That was my only. Commissioner Guggenhime said so what they do. You pick a Goldman Sachs or a Merrill Lynch and they go out and do, do what we need to have done. They will pick the credit providers, find the best rates. Commissioner Johns said Goldman Sachs isn t a bank. That s what I m saying. Commissioner Guggenhime said investment bank. Mr. Kone said so they re not a commercial bank in a sense that where people go and withdraw money. They provide banking services from the investment point of view, so they have investors looking to invest money and they pair us up with those investors who wants to loan us the money. Commissioner Johns said I guess I just had never heard of institutions like this referred to as a bank. Mr. Kone said sometimes they re referred to underwriters because again, if the bonds cannot be sold, they will underwrite the bonds with their money and then they'll go out and find investors thereafter. Commissioner Crayton said I think about a year ago maybe two years ago you brought in maybe not you. It could have been Leo Fermin. I m not sure who it was. It was either the Minutes, October 2, 2018, Page 18

19 Director. Someone who came in and talked to us about our ethical responsibility in terms of approving this and how, what goes in the relationship that Commissioner has just talked about. And so I m wondering if it s time again for us to have that sort of talk again to make certain. Peter was on the Commission at that time when we had the last person to come in. But for myself I think it might be good to do a refresher again in terms of what our responsibilities are and how all that all interrelates. Mr. Kone said so who we brought in was our disclosure counsel and disclosure counsel briefed the Commissioners on their responsibilities of the offering document. The offering document is the document by which then the investment banks take that document and show to the investors and so that's, that's the connection there. And in terms of the training, we are scheduled to do that biannually as part of the Airport's a debt policy and disclosure plan for the Airport. Commissioner Crayton said thank you. Commissioner Johns asked biannually for the Commission? Mr. Kone responded yes. Commissioner Johns asked so when is our next? Mr. Kone responded I will check on that date and get back to you. Commissioner Johns said thank you. There were no further questions. 14. Modification No. 1 to Contract No. 9313, with ThyssenKrupp Elevator Corporation, for Escalator and Electric Walk Maintenance increasing the Contract not to exceed amount by $2,500,000 No Approve Modification No. 1 to Contract No with ThyssenKrupp Elevator Corporation for escalator and electric walk maintenance, increasing the contract not to exceed amount by $2,500,000 for a new not to exceed contract amount of $19,500,000, and extending the contract duration by six months for a new contract end date of June 30, Minutes, October 2, 2018, Page 19

20 15. Approval of Modification No. 1 to Professional Services Contract No , Project Management Support Services for the International Terminal Building Refresh Project International Terminal Building Refresh Joint Venture (ITBR JV) $850,000 No Resolution approving Modification No. 1 (Annual Renewal) to Professional Services Contract No , Project Management Support Services for the International Terminal Building Refresh Project, to International Terminal Building Refresh Joint Venture (ITBR JV), in an amount not to exceed $850,000 for a new contract amount not to exceed $4,650,000 and a new contract duration through November 1, Modification No. 2 to Contract No for Hardware Purchase, Software License, Integration, Support and Maintenance for the Physical Security Information Management and Video Management Systems Verint Security Intelligence, Inc. $660,000 No Approve Modification No. 2 to Contract No , for hardware purchase, software license, integration, support and maintenance of the physical security information management and video management systems with Verint Security Intelligence, Inc., to extend the contract through October 24, 2020 and increase compensation by $660,000 for a new total not to exceed amount of $1,300, Award of Professional Services Contract No to DWU Consulting LLC, for Financial and Capital Plan Management and Analysis Services, in an Amount Not to Exceed $1,450,000 for a Term of Five Years No Resolution awarding Professional Services Contract No to DWU Consulting LLC, to provide financial and capital plan management and analysis services, in an amount not to exceed $1,450,000 for a term of five years. H. NEW BUSINESS: Discussion only. This is the "Public Comment" section of the calendar. Individuals may address the Commission on any topic within the jurisdiction of the Airport Commission for a period of up to two (2) minutes. Please fill out a "Request to Speak" form located on the table next to the speaker's microphone and submit it to the Commission Secretary. Minutes, October 2, 2018, Page 20

21 I. CORRESPONDENCE: There was no discussion by the Commission. J. CLOSED SESSION: There are no planned agenda items for a Closed Session for the current meeting. In the event of any urgent matter requiring immediate action which has come to the attention of the Airport Commission after the agenda was issued and which is an item appropriately addressed in Closed Session, the Airport Commission may discuss and vote whether to conduct a Closed Session under Brown Act (California Government Code Sections (b)(2) and ) and Sunshine Ordinance (San Francisco Administrative Code Section 67.11). If the Airport Commission enters Closed Session under such circumstances, the Airport Commission will discuss and vote whether to disclose action taken or discussions held in Closed Session under the Brown Act (California Government Code Section ) and Sunshine Ordinance (San Francisco Administrative Code Section 67.12). K. ADJOURNMENT: There being no further calendared business before the Commission, the meeting adjourned at 9:34 A.M. (Original signed by: Corina Monzón) C. Corina Monzón Airport Commission Secretary Minutes, October 2, 2018, Page 21

22 Airport Commission Special Advisory Committee Members Larry Mazzola, Airport Commission President and Committee Chair Larry Mazzola, Sr. served as an Officer and Leader of U.A. Local 38, United Association of Journeyman and Apprentices of the Plumbing and Pipe Fitting Industry of the United States and Canada for nearly 50 years. His positions included Assistant Training Director; Organizer; Business Agent; and 24 years as Business Manager and Financial Secretary-Treasurer before his retirement in A native of San Francisco, Mr. Mazzola has spent the last 35 years playing a major role in the leadership of the Bay Area s labor movement. Linda Crayton, Airport Commission Vice President Linda S. Crayton was appointed to the Airport Commission in October, Ms. Crayton worked for AT&T for 23 years before joining Comcast Cable Communications as their Senior Regional Director, Government Relations. Ms. Crayton was the recipient of the Board of Supervisors Award of Recognition for Leadership and has been recognized by the San Francisco Alliance of Black School Educators. Eleanor Johns, Airport Commissioner Eleanor Johns is Executive Director of the Willie L. Brown, Jr. Institute on Politics and Public Service. She is also a member of the Board of Directors of JVS and the San Francisco Conservation Corps. She was Chief of Staff for Mayor Willie L. Brown, Jr., from July 1996 through January In prior years she was a litigation paralegal and from 1961 to 1968 taught in various California schools. Peter Stern, Airport Commissioner Peter A. Stern, a fifth generation Californian, was formerly Vice President of Enterprise Corporate Sales at salesforce.com. He is currently Chief Revenue Officer at Skedulo. He began working in the technology industry in 1997 while attending the University of California, Berkeley. Mr. Stern also held various management and sales executive roles at OpSource, Oracle and Macromedia (now Adobe). John L. Martin, Former Airport Director John L. Martin was appointed the Director of the San Francisco International Airport in 1995 after serving as the Airport's deputy airport director for business and finance. In all, he spent 35 years at SFO until his retirement in 2016, becoming the longest continuously serving airport director in the country. He is currently a Buddhist Insight Meditation Teacher and leads a weekly sitting group in his neighborhood, as well as a LGBTQueer sitting group in Redwood City, and teaches on retreats at meditation centers.

23 Anni Chung, President and CEO, Self Help for the Elderly Anni Chung oversees and manages Self Help for the Elderly, a community-based organization that provides a comprehensive range of health, educational, social, and recreational services to over 40,000 seniors a year, regardless of ability or income levels. She has served as Self-Help s CEO since She also currently serves as Co-Chair of the API Council and the Advisory Board of American s Diabetes Association s Asian Action Council. Melinda Yee Franklin, United Airlines, Managing Director, Corporate and Government Affairs Melinda Yee Franklin currently serves as the Managing Director, Corporate and Government Affairs in the Western Region for United Airlines. Based in San Francisco, she is responsible for legislative, policy, and corporate affairs issues related to California, Hawaii, Alaska, Oregon, Washington State, and Arizona. She sits on the boards of the Los Angeles Area Chamber of Commerce, Los Angeles County Economic Development Corporation, San Francisco Chamber of Commerce, San Francisco Shanghai Sister City Committee, San Francisco Travel, and Fueling California. Anthony Tony Ribera, Department Chair, University of San Francisco A retired Police Chief of San Francisco, Professor Anthony Ribera currently teaches the Law Enforcement Leadership program and has since 1997 when he wrote the original curriculum. In 2001, the University of San Francisco formed the International Institute of Criminal Justice Leadership and appointed Professor Ribera as its director. The Institute's annual symposium has emerged as a groundbreaking forum for progressive law enforcement training and leadership. Candace Sue, Director of Communications and Marketing, Municipal Transportation Authority Candace Sue is Director of the Communications and Marketing Division at the San Francisco Municipal Transportation Agency (SFMTA), which manages the ground transportation network of city streets and public transit. Her responsibilities include all aspects of internal and external communications including strategic communications, community outreach, public relations, social media, marketing, digital and creative services. Before joining SFMTA, she worked at Fortune 100 companies where she gained experience in three industry sectors and earned positions of increasing responsibility.