Pullquotes:

“Even before 9/11, we were facing capacity issues, which became more and more obvious as we ramped up to our record year (2007), when we had 350,000 passengers.”

Tom Werner, executive director, Duluth Airport Authority

 “Using natural thermal resources frees up money we can use to improve the customer experience.”

Tom Werner, executive director, Duluth Airport Authority

“I thought this would be a real win, if we could pull this off without additional local taxpayer dollars. Ultimately, we were able to do that.”

Tom Werner, executive director of Duluth Airport Authority (DLH), starts the conversation triumphantly, and with some noticeable relief: “We have finally built and opened our new terminal building.”

The new facility, more than a decade in the making, was definitely worth the wait.

The $78 million state-of-the-art terminal both impresses and awes with a curved roof and mezzanine symbolizing the waves of Lake Superior, rippled decorative glass representing the lake’s water, haphazard lines in the terrazzo floors inspired by the body of water’s cracked ice in the winter, and red paneled walls on the outside echoing the color of the iron ore boats that sail its waters.  

In addition, the new terminal meets post 9/11 federal safety and security requirements; includes sustainability features such as geothermal heating, natural lighting and an efficient water system; corrects passenger flow deficiencies in the old terminal; and positions the airport for future growth, an important fact as Werner points to signs that the air travel economy is recovering.

“2012 was our second best year ever, with 322,000 passengers passing through,” he says.  “With our ability to attract new customers, our numbers will continue to grow. The new terminal will accommodate the four jet bridges that are not used at capacity; and our concourse, with seating for more than 400, which is rarely filled.”

Out With the Old

The old terminal is scheduled to be razed this spring; a fact that wasn’t a given at the project’s onset.

 Originally, the airport considered remodeling the existing space for approximately $39 million instead of building anew. But the basic design of the old terminal worked against the modern security demands of a post 9/11 era. “In 2003, [when they began planning for the project], we were still trying to adjust to the TSA’s new norm,” Werner says. “After 9/11, it was not easy. There were a lot of unfunded mandates and, of course, the pre-9/11 passenger flow requirements were radically different.”

In addition, remodeling the existing facility would not have solved the airport’s FAA Part 77 issue (tails penetrating restricted airspace), according to Brian Ryks, the former executive director at DLH (and now executive director at Gerald R. Ford (GRR) International Airport in Grand Rapids, Mich.).

“When we decided how to site the new building, we considered Part 77 clearance requirements; to get aircraft far enough away from each other,” Werner explains. “And we found the old building simply would not work. It wasn’t just Part 77, however. When we considered passenger comfort and utility issues, the old [1970s-era] building had to go.”

As airlines phase out many of its 50-seat jets in favor or larger aircraft, compliance with Part 77 will become even more significant, according to Werner. “… we’ll be ready for it,” he says. “If we need to expand, we can add to either end of the facility, without major interruptions.”

Ryks says he and the board also considered the long-range effects of predicted changes in commercial aviation, when determining whether to renovate or move forward with a new construction. They determined the existing terminal’s floor plan was impossible. “There were two separate security checkpoints for about 120 passengers each, and no restrooms!” Ryks says.

The original terminal had been built for far fewer passengers than the airport sees today. While airline tenants remain stable with Delta (to MSP, DET), United/SkyWest (ORD) and Allegiant Air (to LAS; seasonsal service to SFB Orlando/Sanford; and IWA to Phoenix/Mesa twice-weekly service, passenger growth continues.

 “Over the last 30 to 40 years, traffic has grown tremendously,” says Werner. “Even before 9/11, we were facing capacity issues, which became more and more obvious as we ramped up to our record year (2007), when we had 350,000 passengers.”

Werner adds, “This was a 10-year process, design plus construction – a big project.” Given the airport’s small staff of 21, they decided it best to hire a consulting firm with experience in erecting commercial buildings to manage the project. They ultimately decided upon Kraus-Anderson Construction, a Minn.-based firm with more than a century of experience managing commercial construction.  “Kraus-Anderson’s Mike Dosan, the senior project manager, was with us day to day, handling the construction plus the administrative hoops,” Werner says.

 “One of the best things we did was hire Kraus-Anderson (in nearby Bemidji),” says Ryks. “I didn’t have the staff for a project – we had an airport that we had to keep running. [Kraus-Anderson] ensured that we got good bid prices.”

 Also key to the project’s success was keeping the FAA involved and informed, from the start. “In Minneapolis, Chicago, and D.C., they were up to date. They understood our frustrations; and they were very helpful in keeping this program rolling along,” Ryks says.

Beyond Borders

All of DLH’s international flights are unscheduled; the airport’s “international” segment is on-demand. And, the old terminal’s international space was unworkable.

The airport’s new international space utilizes flexible floor planning to meet fluctuating international demand, an idea that came from Minneapolis International Airport (MSP). Ryks was connecting through MSP and noticed “they had walls that dropped from the ceiling, for those times when there were [international] flights. That’s when I got the idea [of flexible space].”

The entire terminal now handles domestic passengers and reserves a gate on the end, to serve as a part-time international/customs facility. With the remodel, this section can be partitioned with a metal curtain for international arrivals. “This positions us well to airlines’ international requirements,” Werner says.

John E. Hippchen, project engineer at architect Reynolds, Smith and Hills Inc., a national facilities, infrastructure, and aviation consulting firm, says, “The new terminal is roughly the same square footage as the old, but much more efficient. The federal inspection station was separate; now, it’s behind movable partition walls, so that when there is no international flight, we can use the space for normal operations. The international baggage carousel is also thus available.”

Going Green

The new terminal, designed by Reynolds, Smith & Hills, is Leadership in Energy and Environmental Design (LEED) certified because of the green features incorporated into its design.

“We embraced ‘green’ construction,” says Werner. “We’re LEED Silver certified. We looked at a lot of long-lasting innovations.”

The goal, however, wasn’t necessarily to be “green,” though that certainly is a nice benefit. The goal was to make as much use of everything available naturally. During construction, they used regionally made products and recycled materials as much as possible and 75 percent of the construction waste was diverted from the landfill.

To create a geothermal heating and cooling system, crews drilled 80 wells, 500 feet deep and 10 inches in diameter into a geothermal water table, where water is 54 degrees Fahrenheit and thus can be used for both heating and cooling. The $5.2 million geothermal system is predicted to save the airport $30,000 in annual utility costs. But it is unknown at this point what the actual savings will be since the system has only been in use since January.

 “Using natural thermal resources frees up money we can use to improve the customer experience,” says Werner. “The geothermal system will handle the entire cooling load in the summer, and ‘a significant portion’ of winter’s heat load.”

A 40-foot window façade in front allows natural light to flood the area, which reduces the airport’s power requirements for artificial lighting. Heated walkways also save money by lessening the need for snow removal and reducing the potential for slips and fall accidents, says Ryks.  

Parking Headaches

According to Hippchen, the new build was “challenging because of the location of the terminal – we needed the new parking before we could start building the terminal; and we had to maintain full access during construction. Phasing the construction and maintaining convenience for passengers was a bit of a logistical challenge.”

The new parking garage holds approximately 400 cars. There are also long- and short-term grade-level spots, a cell phone lot, employee and rental slots, for a total of 1,283 spots. “The loss of about 150 spots to the garage of 400 was a good trade-off,” he says.

The traffic flow throughout the parking areas and near the terminal building is improved. The old facility had single drop-off lane, for everyone. “At times it could get very congested, and potentially it was not too safe,” says Werner. “Now we have two parallel lanes; one is exclusively commercial – taxi, livery, hotel shuttles.”

DLH also overhauled revenue-source management as it pertains to parking, and will be phasing in an e-tag system to track commercial vehicle use, for tracking and cost recovery on a per-use model, rather than a blanket yearly fee. Further, Werner says, “We’ve gone through all our airplane agreements, tenants’ agreements, to look for ways to make them more-consistent and better for all.” 

Baggage Up

After 9/11, baggage systems everywhere needed revamping. Here, DLH experienced some growing pains as it struggled to comply. A new baggage system was needed that worked with current and anticipated security requirements, and was convenient for customers too, says Werner.

 “We now have two fully automated lanes that are designed to run one at a time, with full redundancy,” he says. “For added assurance, we also have a third lane that’s manual; and there is a fourth lane for oversized baggage.

“We commissioned and tested all these systems before opening,” he continues. “TSA’s third-party contractor brought in all sorts of baggage to see where we would find any troubles. The installation company also tested this -- for weeks. We tested for nearly two months, and it was one of the things that went smoothest on opening day (officially January 14, 2013).

Paying for the Project

Ryks says his biggest headache was getting, keeping, and perfecting financing. Many sources – FAA, Minnesota, and ultimately Duluth and others – were employed; each with its own headaches. But his efforts paid off – the entire tab for the project was paid for with federal grants and state bonds.

“We didn’t want to go outside our ‘self-sustaining’ status at the airport. We didn’t want to put additional demands on the taxpayers. I thought this would be a real win, if we could pull this off without additional local taxpayer dollars. Ultimately, we were able to do that.”

He credits the help of others and working hard to sell the project to others as the reason for their financing success. “Northwest helped us with the state legislature to secure approximately $16.6 million in state bonding. It’s not a loan; you find a match,” says Ryks. “We used federal discretionary money. That was challenging – the state was looking at budget so we really had to sell this. We would have lost substantial FAA dollars, if we couldn’t get approval.”

The other big challenge, since Congress balked on long-term FAA financing, was paying contractors. “With Congress’s inactivity, we lived on continuing resolutions. We’d get our bids in, and then we’d wait to see what the FAA would get as ‘discretionary’ money. It was frustrating … Contractors don’t like to work that way, either. We’d continue to extend our Notices to Proceed, from 60 to 90 days; then we’d push it out to maybe 120 days. In Duluth, we don’t have a long construction season. The timing … was a big challenge.”

The FAA money goes through the state’s aviation department, which also slows the process down. “We issue pay requests to the state, they sent them to the FAA; the FAA then reimburses the state, and the state pays us. And, during this project, the state government shut down.” Ryks arranged a $4 million line of credit with Duluth. “Then, right after the state shut down, the FAA shut down. This was an $80 million project. It probably could have been done in two or 2 ½ years; but because of the lack of an Aviation Bill, the shutdowns and the uncertainty, it took more like four years. “

But Werner explains that he’s happy to finally be open for business and only 0.5 percent over budget to boot.

“It’s taken partnerships locally and at different government levels, including MDOT, FAA, TSA – so many people had to come together between here and Washington, D.C. to get this done,” he says. “It really speaks to the dedication of those who were involved.”

BIO: Tim Kern, CAM, MBA, is a freelance writer based in Anderson, Ind., who specializes in aviation issues.