A Sense of Place: Sea-Tac's role in the aviation system, and in its region, is about to be realized

Runway challenges
The most challenging aspect of the CIP has been, by far, the construction of a third runway. If the airport had been allowed to go ahead with the construction in 1997 as planned, it would have cost some $587 million. Today, after several legal battles with local opposition, an extensive buyout program of the homes that were displaced because of the runway, and extensive mitigation, the investment is expected to top $1 billion.

In terms of mitigation, as Parker explains, the airport purchased some 500 acres to make room for the additional runway. While much of this land was residential, the airport is nonetheless being required to mitigate at least 20 acres of land for the displacement of the wetlands, which includes establishing a habitat for birds in nearby Auburn, WA.

"We're not talking pristine wetland," Lindsey says. "These are urban ditches that will be in much better shape when we are finished with the runway project than they have been in the last 20 years. The interesting thing is it's not really environmental groups, it's the NIMBYs (not in my backyard) [who are heavily against the third runway]. They're just using the environmental process as the mechanism by which to slow things down."

Airport officials are quick to point out that the runway, unlike at other airports, is not intended to increase SEA traffic. "Our two runways are only 800 feet apart," Parker explains. "We only need two runways, but we need two runways in all weather. Forty-four percent of the time clouds are low enough that the tower can only bring in one stream of aircraft. So, even with reduced traffic since 9/11, 20 percent of flights are off from their published times." These delays cost the airlines an estimated $120 million annually ($180 million per year, pre-9/11). Parker adds that with these statistics it will take less than ten years to offset the cost of the runway.

"We'll get this done," Lindsey says, "although at a very high cost." Barring any further delays, the airport is anticipating the runway will be completed by November 2008.

Retail With A View
The retail redevelopment at the airport is seen as a focal point for the administration team. As Lindsey explains, the airport model has changed over the years to allow for more capitalization of the terminal space. The redesign maximizes this as Sea-Tac's 40-year contract with master concessionaire HMS Host comes to an end.

According to Kottayam Natarajan, Jr., aviation business development GM, the airport started the renovation by changing its retail model. Instead of a single master concessionaire, the airport will have several prime concessionaires, offering more choices to travelers. Among the retailers, Hudson Group will operate 22 news and gift stands, the Seattle Restaurant Associa-tion will have eleven operations, HMS Host will continue to manage 30 venues, Concessions International will manage nine locations, and there will be another eleven independent retailers. The new Central Terminal layout will offer the airport 50 percent more square footage of retail space.

Under the revised lease structure, retailers will be required to build out their own operating space, under the supervision of the airport. Rent is based on a percentage of gross sales, with a minimum annual guarantee, says Natarajan. Another key feature of the program will require that all vendors offer street pricing. "Services at airports aren't just gates and parking," he says. "We're providing an entire experience and passengers are now happy to have some time to kill and the prices are right."

As ACI-NA Prepares To Meet, Chair Lindsey Targets Changing Airport Business Practices

The 12th Annual Airports Council International-North America Conference and Exhibition will be held in Tampa, FL, September 14-17. Gina Marie Lindsey, ACI-NA chair and aviation director at Seattle-Tacoma International Airport, expects much of the discussion to focus on industry regulation, AIP reauthorization, relationships, and security.

"Airports have a strong interest in having a much less regulated environment," Lindsay says. "I think we're totally in favor of all the necessary regulations for safety, nondiscrimination, security, etc., but there's economic regulation of both airports and airlines that I'm not clear is necessarily productive. The major airports were set up to be a quasi-business enterprise. We all have a government responsibility, we have a public responsibility, but we also have the responsibility to live with our own bottom line.

"Somehow over the years there's been something of an adversarial relationship, mistrust, and a sense of suspicion that has developed between the major factions of the industry. That's not productive... The Federal government clearly can't run the businesses - the airports or the airlines - but it does have a significant and justifiable role in determining and regulating what is necessary to provide a national system of aviation. Sometimes inefficient relationships can be perpetuated and sustained if there's lots of money; there's not a lot of money anymore... Our practices that let us operate under that old model are going to have to change if we're going to survive. I think we're at a crisis time in the industry. And it's not just crisis time because the airlines are having a difficult time making payroll.

It's crisis time because our way of conducting our business needs to fundamentally change.

"The Airport Improvement Program was up this year for reauthorization. There was a hope at one point that we [ACI-NA] might be able, through that reauthorization, address some fundamental issues: What role should the airports have? What role should the airlines have? What role should the government have? Now we're pretty far along on the AIP bill through conference, so I don't think that's going to be a revolutionary mechanism we hoped it might be, but that's okay. We're still going to need to make these industry changes, and if we can't do it through the AIP reauthorization bill, then we'll have to do it through other mechanisms.

"Security is going to be a continuing discussion. Partially because we all have to respond to today's alligator that's grabbing our leg. I can have all sorts of strategic things on my calendar when I walk in in the morning, but when I see a double stacked line at B Checkpoint, that's what becomes my focus."